[Senate Hearing 109-769]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 109-769
 
               THE PRESIDENT'S BUDGET FOR FOREIGN AFFAIRS

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

                                HEARING



                               BEFORE THE



                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE



                       ONE HUNDRED NINTH CONGRESS



                             SECOND SESSION



                               __________

                           FEBRUARY 15, 2006

                               __________



       Printed for the use of the Committee on Foreign Relations


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                     COMMITTEE ON FOREIGN RELATIONS

                  RICHARD G. LUGAR, Indiana, Chairman

CHUCK HAGEL, Nebraska                JOSEPH R. BIDEN, Jr., Delaware
LINCOLN CHAFEE, Rhode Island         PAUL S. SARBANES, Maryland
GEORGE ALLEN, Virginia               CHRISTOPHER J. DODD, Connecticut
NORM COLEMAN, Minnesota              JOHN F. KERRY, Massachusetts
GEORGE V. VOINOVICH, Ohio            RUSSELL D. FEINGOLD, Wisconsin
LAMAR ALEXANDER, Tennessee           BARBARA BOXER, California
JOHN E. SUNUNU, New Hampshire        BILL NELSON, Florida
LISA MURKOWSKI, Alaska               BARACK OBAMA, Illinois
MEL MARTINEZ, Florida
                 Kenneth A. Myers, Jr., Staff Director
              Antony J. Blinken, Democratic Staff Director

                                  (ii)



                            C O N T E N T S

                              ----------                              
                                                                   Page

Biden, Hon. Joseph R., Jr., U.S. Senator from Delaware, opening 
  statement......................................................     4
    Prepared statement...........................................     5
Lugar, Hon. Richard G., U.S. Senator from Indiana, opening 
  statement......................................................     1
    Prepared statement...........................................     1
Rice, Hon. Condoleezza, Secretary of State, Department of State, 
  Washington, DC.................................................     7
    Prepared statement...........................................     9

              Additional Material Submitted for the Record

Dodd, Hon. Christopher J., U.S. Senator from Connecticut, 
  prepared statement.............................................    55
Responses of Secretary Rice to questions submitted by the 
  following Senators:
    George Allen.................................................    73
    Joseph Biden.................................................    56
    Barbara Boxer................................................    74
    Lincoln Chafee...............................................    90
    Russell Feingold.............................................    75
    Chuck Hagel..................................................    95
    Richard Lugar................................................   101
    Mel Martinez.................................................    82
    Paul Sarbanes................................................    86
    John Sununu..................................................   124
    George Voinovich.............................................   129
ABC News Poll: Life in Afghanistan, December 7, 2005.............   133

                                 (iii)

  


               THE PRESIDENT'S BUDGET FOR FOREIGN AFFAIRS

                              ----------                              


                      WEDNESDAY, FEBRUARY 15, 2006

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:45 a.m., in 
room SH-216, Hart Senate Office Building, Hon. Richard G. Lugar 
(chairman of the committee) presiding.
    Present: Senators Lugar, Hagel, Chafee, Allen, Coleman, 
Alexander, Murkowski, Martinez, Biden, Sarbanes, Dodd, Kerry, 
Boxer, Nelson, and Obama.

 OPENING STATEMENT OF HON. RICHARD G. LUGAR, U.S. SENATOR FROM 
                            INDIANA

    The Chairman. This hearing of the Foreign Relations 
Committee is called to order.
    Secretary Rice will be with us in a few moments. She is en 
route presently. Because we have a very restricted time period 
today, from 9:45 to 11:45, we're going to try to utilize each 
minute so that we will have maximum fairness to each one of our 
members who may have questions and dialog with the Secretary.
    Let me mention that, at a point in which a quorum of the 
committee is present--that is, 10 members--at a convenient 
point, and with the cooperation of the distinguished ranking 
member, Senator Biden, we will pause for a short business 
meeting of the committee. We have a substantial list of Foreign 
Service officers. We have a number of ambassadors who have been 
heard in subcommittee or full committee meetings, as well as 
State Department persons. We will try to gain confirmation of 
those, at least in the committee, and send those to the floor.
    In the interest of attempting to expedite the hearing, I 
have a substantial opening statement, which greets the 
Secretary, points out the difficulties that both the Secretary 
and Congress have had in getting the support that we need for 
our State Department for foreign assistance, and for our other 
foreign policy objectives. It is important that we formulate 
strategies to work effectively together in those endeavors. I 
will submit that statement for the record and may refer to it 
in my time of questioning.
    [The prepared statement of Senator Lugar follows:]

   Prepared Statement of Richard G. Lugar, U.S. Senator From Indiana

    Today the Foreign Relations Committee welcomes Secretary of State 
Condoleezza Rice. We greet her as the President's spokesperson on world 
affairs and the chief architect of U.S. foreign policy. We have many 
questions for her pertaining to a wide variety of foreign policy 
issues, including the Bush administration's plans for making further 
progress in Iraq and Afghanistan; the status of negotiations pertaining 
to Iran, North Korea, and the Arab-Israeli peace process; and her 
assessment of the State Department's budget.
    This is the first international affairs budget that has been 
developed under Secretary Rice's guiding hand. This budget should be 
seen as the civilian counterpart to our military budget. The missions 
and objectives funded by the international affairs budget must be 
strengthened if we are to secure America's future. Secretary Rice's 
call for ``transformational diplomacy'' is evidence that she agrees. 
This budget includes a welcome increase, but recent history suggests 
that the full request may not survive the congressional budget process 
without vigorous and ongoing dialog between the executive and 
congressional branches.
    Last year, Congress slashed the President's international affairs 
request by $2.1 billion--or about 6 percent. The year before that, 
Congress cut the request by a comparable amount. Thus, for two 
consecutive years, Congress has refused to give the President what he 
says he needs to address global challenges through nonmilitary means. 
Much criticism of administration policy in the war on terrorism is 
leveled on the Senate floor and in various congressional committees, 
but the Congress itself is limiting the number of people and programs 
that could be activated to address terrorism, weapons proliferation, 
energy dependence, avian flu, religious extremism, and innumerable 
other threats. None of these national security challenges can be 
overcome purely through unilateral policy choices or through military 
action. We are dependent on other nations to help us respond to these 
threats so that individual Americans can enjoy the security they need 
to get an education, build a career, raise families, save a nest egg, 
and live fulfilling lives. We cannot fully succeed in this fundamental 
mission, unless the programs and people funded by this budget succeed.
    The Bush administration deserves praise for its international 
affairs budget submissions. President Bush and Secretary Powell 
reversed the downward spiral in U.S. foreign policy capabilities that 
was imposed during the 1990s. In that decade, both Congress and the 
executive branch rushed to cash in on the peace dividend. The defense 
budget was cut substantially, but in percentage terms, the much smaller 
foreign affairs budget suffered even more. During the 6-year period 
from 1992 to 1998, the 150 Account was cut every single year. As a 
percentage of GDP, this 6-year slide represented a 38-percent decrease 
in foreign affairs programs.
    In the post-cold-war days, cutting the 150 Account seemed logical 
to many. But by the time we confronted the tragedy of September 11, 
2001, many of our foreign policy capabilities were in disrepair. In 
2001 the share of the U.S. budget devoted to the international affairs 
account was barely above its post-World War II low and only about half 
of its share in the mid-1980s. Embassy security upgrades were behind 
schedule, we lacked adequate numbers of diplomats with key language 
skills, many important overseas posts were filled by junior Foreign 
Service officers, we possessed little civilian post-conflict 
stabilization and reconstruction capacity, and our public diplomacy was 
dismal. Our diplomatic capabilities have made progress under President 
Bush, but much work is left to be done.
    Given Congress's actions during the last 2 years, one might begin 
this hearing by asking an obvious question: Namely, what $2 billion in 
this budget submission does the administration prefer to be cut? But I 
believe that Secretary Rice genuinely wants to devote every dollar of 
the request to aggressively safeguarding America's future. So instead, 
I would like Secretary Rice to explain in her remarks what the 
President and his administration will do to guarantee that Congress 
preserves this request and approves the supplemental funding for the 
150 Account that we hear will be requested soon.
    What will the Commander in Chief do--in an era that members of his 
administration are describing as the ``long war''--to ensure that he 
has the civilian tools to fight that war? What will he do to ensure 
that we have sufficient funding to build secure embassies for American 
workers and travelers, to deny terrorists any hope of official 
documentation to enter this country, to work with foreign partners to 
track down terrorists overseas, and to secure dangerous weapons 
wherever they are found?
    I would cite one episode to illustrate the difficult atmosphere in 
Congress with respect to the international affairs budget. During last 
year's budget resolution, an amendment was offered in the early stages 
of consideration to shift $410 million from the 150 Account to another 
priority. The amendment passed virtually without dissent, 96 to 4. The 
four Senators who voted against the cut to the 150 Account were members 
of this committee.
    This lopsided defeat occurred despite the fact that 44 Senators had 
signed a letter to President Bush shortly before strongly urging ``a 
robust increase'' in the international affairs budget. Even the 
Senators who had organized the letter voted against the 150 Account in 
this first challenge to it. I do not question the judgment of the 96 
Senators who voted for the amendment. The account to which the money 
was transferred was a compelling priority. But we must recognize that 
the budget is full of compelling priorities, and historically, foreign 
affairs spending has been a prime target for offsetting increases 
elsewhere.
    Even today, when we are in the midst of a global struggle of 
information and ideas, when anti-Western riots can be set off by the 
publication of a cartoon; when we are in the midst of a crisis in Iran 
that will decide whether the nonproliferation regime of the last half 
century will be abandoned; when we are soon to enter our fourth year of 
attempting to stabilize Iraq; and when years of effort to move the 
Arab-Israeli peace process are at risk--even then, the reservoir of 
support for international spending in Congress is shallow. Members of 
Congress may recognize the value of the work done by the State 
Department and some selected programs may be popular, but the 150 
Account seldom will be defended against competing priorities.
    Again, this year, 45 Senators have signed a letter to the President 
asking for increases in the 150 Account. But Congress, left to its own 
devices, is unlikely to give the President what he has requested. The 
only way to achieve full funding of the request is for the President, 
the Secretary of State, and other top officials to emphasize 
unequivocally and repeatedly over the course of months that this is the 
amount that we need to keep the country safe and to meet our 
obligations. They must draw indisputable connections between this 
funding and American national security.
    To make a comparison, I recently interacted with the Department of 
Defense on a program that they wanted to initiate. I received notes, 
telephone calls, and visits from members of the Joint Chiefs, a 
combatant commander and top civilian leadership at the Pentagon. With 
this kind of legislative mobilization and willingness to explain their 
requests, the Defense Department tends to succeed in debates on 
spending and programmatic changes. We need a State Department with 
similar determination, backed up by Presidential support.
    This committee will soon hold a hearing to examine policy options 
with respect to Iran. That nation's intransigence in the face of 
growing international opposition points to a diplomatic showdown. We 
should not underestimate the impact of an Iranian Government possessing 
nuclear weapons. Beyond our concerns about what a hostile government 
might do with such weapons, the development of an Iranian nuclear 
capability could destabilize the Middle East and undercut the efficacy 
of the Nuclear Non-Proliferation Treaty. The administration has sought 
a diplomatic solution to the problem working through allies and the 
United Nations Security Council.
    At the U.N. Security Council last week, I told that body: ``If Iran 
does not comply with U.N. resolutions and arms agreements, the Security 
Council must apply strict and enforceable sanctions. Failure to do so 
will severely damage the credibility of a painstaking diplomatic 
approach and call into question the world's commitment to controlling 
the spread of nuclear weapons.'' I am particularly interested in 
hearing from the Secretary if the administration has a set of sanctions 
in mind that it believes would alter Iranian behavior. I believe that 
we must think two or three steps beyond the question of whether we can 
obtain an original positive vote in the Security Council.
    Similarly, we are interested in your views on Iraq. Last week, this 
committee held a hearing on the efforts to stabilize and reconstruct 
Iraq, which revealed some progress, but also some troubling 
deficiencies. The State Department is now the lead executive branch 
agency in charge of stabilization and reconstruction in Iraq. As the 
administration asks for additional funding for Iraq reconstruction, we 
must continue to make certain that funds are being spent efficiently 
and according to a clear set of priorities.
    We are also eager to listen to your views on the Arab-Israeli peace 
process in the wake of the election of Hamas. We applaud the personal 
efforts you have made to preserve and advance the peace process.
    I want to commend your work to develop a more efficient and 
coordinated U.S. Government foreign assistance strategy. Your decision 
to name Randy Tobias as the USAID Administrator and your advisor on 
developing a new, comprehensive approach to foreign assistance is 
welcome, and we are looking forward to his confirmation hearing.
    Another area where your leadership is particularly appreciated is 
your support for the State Department's Office of Reconstruction and 
Stabilization and your decision to dedicate 15 of the 100 newly 
requested State Department positions to that Office. As you know, 
Senator Biden and I initiated conversations back in 2003 about this gap 
in the Department's capability. It was clear to us that the State 
Department and USAID needed to develop an ability to mobilize quickly 
in post-conflict situations. I hope that you will create the Active-
Duty component of the response corps that we envisioned in our 
legislation. We should work together to make certain that both the $75 
million conflict response fund and a robust operations budget is funded 
for this purpose.
    Madame Secretary, it is a pleasure to have you with us today. We 
look forward to your insights on these matters and to the chance to 
engage you in a dialog on the administration's global strategic vision.

    The Chairman. I will then, turn now to the distinguished 
ranking member, Senator Biden, for his opening statement, 
following which we're hopeful that the Secretary will be able 
to give her statement, and then we will proceed with a question 
period, starting with a round of 5 minutes for each member, 
moving around the table from one side of the aisle to the 
other. Hopefully we will have an excellent opportunity to 
explore all of our major issues.
    It's a privilege, as always, to have the Secretary of 
State. We look forward to this hearing. We thank her for 
accommodating the schedule to Congress, which made it necessary 
to postpone the hearing yesterday due to rollcall votes on the 
floor.
    I turn now to my distinguished friend, Senator Biden.

 OPENING STATEMENT OF HON. JOSEPH R. BIDEN, JR., U.S. SENATOR 
                         FROM DELAWARE

    Senator Biden. Thank you very much, Mr. Chairman.
    I have a longer statement that I'll submit for the record, 
and I will repeat some of this in my questioning to the 
Secretary.
    But one of the things that I'd like to speak to the 
Secretary about today is the overall rationale for this 
administration's foreign policy. Four years ago, they announced 
that the ``axis of evil'' had to be dealt with, they talked 
about Korea, Iran, and Iraq. Korea now has the capacity to have 
at least four times as many nuclear weapons as they had before. 
We say that they cannot be a nuclear state, when, in fact, they 
are. They are a nuclear state, and we seem to be living with 
it. What are we going to do about it?
    With regard to Iran, there was, I think, a paralysis for 
about 4 years on Iranian policy, but now I want to talk to the 
Secretary. I think the administration has gotten the policy on 
track here, in terms of working with the rest of the world to 
attempt to isolate and thwart the aspirations of the present 
Iranian Government toward acquiring nuclear capability, or 
nuclear weapons capability.
    And in Iraq the question is, Are we going to leave behind a 
nation more stable than we found it when we went in? We had a 
very damaging, I thought, report by the inspector general about 
the status of our reconstruction efforts in Iraq in every 
measurable indicia of progress--oil, potable water, sewage, et 
cetera. We are way behind. And we're actually at prewar levels 
for the Iraqi people. And it's clear to me that we're going to 
substantially draw down the American forces. It's clear to me 
we're going to be below a hundred thousand, by the end of this 
year; and at the end of 2007, significantly lower. And as you 
and I have talked, and many of us have talked about it, there's 
a need to galvanize international pressure on Iraqi leaders to 
actually come up with a consensus government. I'm not hopeful, 
based upon the deal made, apparently, with Jaafari and Sadr. 
I'm not hopeful. And so, I'd like to talk about that a little 
bit, because the policy seems not to be succeeding.
    And I'd also want to talk about the policy of elections. I 
think this administration is enamored with elections, and 
confuses them with democracy. Elections a democracy doesn't 
make. Democracies cannot come to fruition without elections, 
but you need the infrastructure for democracy. And we've not 
done all that well in the elections that have been held.
    And in Lebanon, Hezbollah gains a democratic, ``foothold.'' 
We all know what happened in Israel with Hamas, a difficult 
problem to deal with. In Egypt, the Muslim Brotherhood. In Iraq 
the elections clearly went toward a clerical pro-Iranian tilt. 
Where does that go? So, I want to talk about that.
    I also want to mention the 9/11 Commission. The 9/11 
Commission has given pretty bad grades here.
    And I see the Secretary is here now. Madam Secretary, we 
weren't being disrespectful; we're trying to save your time by 
us doing our opening statements----
    Secretary Rice. I apologize.
    Senator Biden [continuing]. In your absence. And we'll 
repeat some of this in questioning.
    And I also want to talk, Mr. Chairman, a little bit about 
Darfur. It is good news the United Nations has taken the step 
it has, but, quite frankly, in the interim an awful lot of 
people are going to die. And I firmly believe the United States 
should lead the way in NATO to provide a small NATO protection 
force and a NATO-enforced no-fly zone to bridge the U.S. 
mission.
    And, last, I want to commend the Secretary for thinking 
creatively with her proposal on the Foreign Service and 
coordination of foreign assistance programs. And I'd like to 
speak about that a little bit.
    But my entire statement I'd like to be placed in the 
record, if I may, Mr. Chairman.
    The Chairman. It will be placed in the record in full.
    Senator Biden. And I thank you for holding this hearing. I 
thank the Secretary for accommodating our schedule from 
yesterday.
    Thank you.
    [The prepared statement of Senator Biden follows:]

 Prepared Statement of Senator Joseph R. Biden, Jr., U.S. Senator From 
                                Delaware

    Madam Secretary, welcome back to the committee.
    Four years ago, the President warned that we confronted a dangerous 
axis of evil in Iraq, Iran, and North Korea, and that by seeking 
weapons of mass destruction, these regimes presented a ``grave and 
growing danger.''
    Today, two members of the axis of evil--Iran and North Korea--pose 
an even greater threat to our security than they did 4 years ago, and 
in the third, Iraq, we risk trading a dictator for chaos.
    We continue to have a great debate about Iraq. But we can all agree 
that an unstable Iraq is not in our interests.
    The drawdown of American troops is already underway--I believe we 
will be down to 100,000 Americans by the end of this year, and half 
that number by the end of 2007.
    The critical question now is whether we will leave Iraq with our 
security interests intact. The answer will depend on our success in 
three areas:
    First, we must galvanize international pressure on Iraq's political 
leaders to form an inclusive government and agree to a consensus 
constitution.
    Second, we must provide Iraqi security forces with the leadership, 
training, equipment, and logistical capabilities to operate on their 
own. We have made progress, but there is still a long way to go.
    Third, we must develop Iraq's governing capacity and ability to 
deliver basic services.
    Last week, we heard a dismal report on the current state of Iraq's 
infrastructure. By just about every critical measure--electricity, 
drinkable water, sewage treatment, and oil production--Iraq is worse 
off today than before the war. Unless these shortfalls are addressed, 
they will continue to fuel the insurgency.
    Perhaps the gravest danger to our security lies in Iran. If the 
world does not dissuade Iran from producing fissile material, or 
developing the capacity to produce that material, then an extremist 
government that actively supports international terrorism will gain a 
nuclear weapons capability.
    Four years of policy paralysis in Washington during the first term 
did nothing to stop Iran's program. I commend you for the last year of 
determined diplomacy, which has led to a broad coalition of support for 
reporting Iran to the U.N. Security Council.
    But that was the easy part. Now the world must take more tangible 
action to show Iran how isolated it will be unless it reduces its 
nuclear ambitions.
    The world must also convince the Iranian people that a nuclear 
weapons capability is not in Iran's national security interest. I urge 
the executive branch to conduct careful studies of possible sanctions--
and their impact--that could be implemented against Iran. It is equally 
vital for the administration to prepare the American people for some 
level of sacrifice in order to maintain economic pressure on Iran.
    The administration has stated that ``The United States is not 
prepared to tolerate a nuclear-armed North Korea.'' I don't know what 
that means, as most experts believe North Korea already has nuclear 
weapons, and that it probably increased its arsenal from one to two 
weapons to as many as 10 over the past 5 years.
    I do know this: Big nations should not bluff. And by any measure we 
are currently tolerating a nuclear North Korea.
    The United States is not to blame for North Korea's intransigence. 
But the lack of urgency and attention given to this problem is 
troubling.
    In December, the 9/11 Commissioners issued their latest report card 
on the Government's efforts to implement its recommendations. On the 
areas where the State Department has responsibility, Madam Secretary, 
it did not make the Dean's List.
    The Commissioners gave out several ``Ds''--including on the issue 
of making a maximum effort to prevent terrorists from acquiring weapons 
of mass destruction, our policy on Saudi Arabia, and certain public 
diplomacy efforts.
    I am not surprised by this dismal rating--for years, this 
administration has underfunded critical nonproliferation programs and 
failed to cut through redtape with Russia.
    The recent victory of Hamas in the Palestinian elections is further 
evidence that elections do not a democracy make. Indeed, the recent 
string of strong showings by Islamists in the Middle East--Hamas, the 
Muslim Brotherhood in Egypt, religious parties in Iraq, and Hezbollah 
in Lebanon--remind us that elections can produce distorted outcomes 
when there is not equal emphasis on developing the institutions of 
democracy, such as political parties, a civil society, a free press, 
and the rule of law.
    Hamas's victory casts a pall on the future of the peace process. 
Israel cannot be expected to negotiate with a party that calls for its 
destruction, engages in terrorism, and maintains an armed militia.
    Unless Hamas changes it stripes, we must build international 
support to isolate it.
    I remain concerned by the inadequate response to the tragedy in 
Darfur. The initiative to establish a U.N. force for Darfur is welcome. 
But it will take up to a year to deploy such a force. In the meantime, 
thousands more will suffer from genocidal acts. The United States 
should lead the way in NATO to provide for a small NATO protection 
force--and a NATO-enforced no-fly zone--as a bridge to the U.N. 
mission.
    Finally, let me commend you for thinking creatively with your 
proposals on the Foreign Service and coordination of foreign assistance 
programs. We still don't know all the details of these proposals, but 
we look forward to working with you to develop them in the months 
ahead.

    The Chairman. Indeed. And we greet you, Secretary Rice. We 
thank you very much for making it possible for us to conduct 
this hearing today, because your presence is the essential 
element.
    I've submitted my opening statement for the record. Senator 
Biden has summarized his, and it's a part of the record. As I 
have mentioned earlier, I'm hopeful that staff members will 
inform Senators as they are coming in, that we have a very 
important promotion list, as well as nominees to the State 
Department, and ambassadorships. At a time that we get a 
quorum, we will have a short business meeting, and hopefully do 
business which will be helpful to you and to American diplomacy 
in the process.
    But we're delighted that you're here, and honored. I have 
informed all of us that our hearing must end at 11:45; 
therefore, we'll adopt a 5-minute question period so that 
members, hopefully, on both sides of the aisle, can be 
accommodated.
    It's a privilege to recognize you, Secretary Rice.

    STATEMENT OF HON. CONDOLEEZZA RICE, SECRETARY OF STATE, 
              DEPARTMENT OF STATE, WASHINGTON, DC

    Secretary Rice. Thank you very much, Mr. Chairman, Senator 
Biden, Senator Hagel, other Senators. Thank you very much for 
giving me the opportunity to address you.
    I have a longer written statement, which I would like to 
enter into the record, but I will not go through that 
statement, so that we can maximize time for questions.
    Mr. Chairman, it's been a little over a year since I was 
confirmed by this committee as Secretary of State, and 
obviously a lot has happened in that year.
    The President's budget this year is in support of a foreign 
policy that is devoted to the creation of a more hospitable 
environment for the forward march of freedom and democracy. 
Democratic processes must be supported around the world. These 
are transitional periods in some part of the world--some parts 
of the world, like the Middle East. And the democratic 
transitions are, indeed, difficult. But people have to have 
their voice, and the United States must stand for a principle 
that democratic processes, no matter how difficult, are always 
preferable to the false stability of a dictatorship.
    You will notice that this year the President is requesting 
funding for Iraq and Afghanistan, where young democracies are 
trying to make their way toward stability. I will talk later, 
perhaps in questions, about developments in the Middle East; in 
particular, the Palestinian elections. And let me just say that 
the United States does want to congratulate the Palestinian 
people on having held an election that was largely free of 
violence and largely believed to be free and fair. The 
Palestinian people voted for change. We believe that they voted 
for change against long-term corrupt practices that have made 
their lives difficult and their progress difficult. What has 
not changed is the Palestinian people's desire to have a freer 
and a better life. And, in that regard, Hamas, which won that 
election, now has both an obligation and a choice to fulfill 
the Palestinian people's desire for a better life. That better 
life can only be achieved in a peaceful environment, which can 
only be achieved with a two-state solution. And so, Hamas is 
being confronted with a choice by the international community. 
I think the Quartet statement speaks to that choice, that Hamas 
must recognize the right of Israel to exist; disarm as a 
militia; and renounce violence. Because only under those 
circumstances can there be true international support for the 
next Palestinian Government.
    We recognize, also, that other major challenges have arisen 
this year. In particular, I would like to speak briefly to the 
Iranian problem, the Iranian regime, with its destabilizing 
policies throughout the region, policies that support terrorism 
and violent extremism. The Iranian regime uses those tools to 
further ideological ambitions and policies that are, frankly, a 
challenge to the kind of Middle East that I think we would all 
like to see, one of tolerance, one of democracy. The United 
States will actively confront the aggressive policies of this 
Iranian regime. And, at the same time, we are going to work to 
support the aspirations of the Iranian people for freedom in 
their own country.
    The Iranian regime is now deepening its own international 
isolation through toxic statements and confrontational 
behavior, most especially in its pursuit of nuclear weapons and 
pursuit of policies that are now being roundly condemned by the 
international community.
    Mr. Chairman, I think it's fair to note that no one wants 
to deny the Iranian people or the Iranian nation civil nuclear 
power. Many different options have been put before Iran. They 
have chosen to isolate themselves instead. In a year of 
peaceful and patient efforts, the United States has broadened 
the diplomatic consensus on the threat posed by Iran's nuclear 
program. We have successfully convinced Russia and China and 
India and Brazil and Egypt and many others to send the issue to 
the U.N. Security Council. The community of nations is, as I 
said, not debating whether Iran should have civil nuclear 
power, but how to safely do so without a proliferation risk.
    We must now expand the international consensus on the 
Iranian regime's nuclear ambitions to address the full scope of 
its threatening policies. In conjunction with our multilateral 
diplomacy, the United States will develop sensible measures, 
security measures, including looking further at our 
Proliferation Security Initiative and those who cooperate with 
us to try and deny, to regimes like Iran, North Korea, and 
others, the materials for covert programs that threaten the 
international system.
    At the same time, we are going to begin a new effort to 
support the aspirations of the Iranian people. I want to thank 
the Congress for giving us $10 million to support the cause of 
freedom and human rights in Iran this year. We will use this 
money to develop support networks for Iranian reformers, 
political dissidents, and human rights activists.
    We also plan to request $75 million in supplemental funding 
for the fiscal year 2006 to support democracy in Iran. That 
money would enable us to increase our support for democracy and 
improve our radio broadcasting, begin satellite television 
broadcasts, increase the contacts between our peoples through 
expanded fellowships and scholarships for Iranian students, and 
to bolster our public diplomacy efforts.
    In addition, I will be notifying that we plan to reprogram 
funds in 2007 to support the democratic aspirations of the 
Iranian people.
    Now, I'm sure that the members of the committee know that 
going forward with this effort requires that we remove 
obstacles that hinder our ability to support those courageous 
Iranians working for their country's freedom, so we are working 
with the Treasury Department to overcome U.S. regulatory 
restrictions to allow the U.S. Government to make grants to 
nongovernmental organizations for democracy promotion 
activities in Iran.
    We want to expand our educational exchanges with the young 
people of Iran who have never experienced democracy. In the 
1970s, 200,000 Iranians studied in the United States. That 
figure is 2,000 today. We must change this. And we will. And 
we're beginning a new effort to dramatically increase the 
number of Iranians who can come to study in America, the number 
of Iranian professionals who wish to visit. I've said, on a 
number of occasions, that I've read that it is forbidden in 
some quarters to play Beethoven and Mozart in Tehran. We hope 
that Iranians can play it in New York or in Los Angeles.
    Finally, let me just say, Mr. Chairman, that Senator Biden 
kindly mentioned the efforts that we're making in the 
Department to transform our workforce, to transform the men and 
women--the skills and tools of the men and women--of the State 
Department who must lead our transformational diplomacy. We 
have repositioned 100 Foreign Service and other positions--
there will be more--because we feel that the presence needs to 
match the global challenges.
    We have also undertaken, within the limits of my authority, 
a reform of foreign assistance so that we can get better 
alignment between USAID and State, so that we can be better 
stewards of the American people's money.
    I want to be very clear that America will always care for, 
and will always try to serve, the most vulnerable populations 
with humanitarian assistance and with help for child welfare 
and with assistance to disaster relief, when necessary. It is 
also our goal to make our foreign assistance something that is 
not permanent for countries as they transition to well-managed 
countries that fight corruption, that govern wisely, that make 
investments in their people. And so, one of our goals is to 
make certain that we are serving, also, the objective of the 
creation of well-governed democratic states that, on their own, 
can attract foreign investment, attract trade, and begin to 
move away from foreign assistance.
    Thank you very much, Mr. Chairman, and I'm now happy to 
take questions.
    [The prepared statement of Secretary Rice follows:]

Prepared Statement of Condoleezza Rice, Secretary of State, Department 
                        of State, Washington, DC

    Thank you, Mr. Chairman, members of the committee. I appreciate 
this opportunity to address the committee and to talk about America's 
role in meeting the unprecedented challenges of our world today. I look 
forward to working closely with Congress to ensure that America's 
diplomacy has the necessary resources to secure our interests, advance 
our ideals, and improve people's lives around the world. In all of 
these mutual efforts, of course, we must remain committed to our 
responsibility to be good stewards of the American taxpayers' hard-
earned dollars.
    The President's FY 2007 International Affairs Budget for the 
Department of State, USAID, and other foreign affairs agencies totals 
$35.1 billion. President Bush also plans to request supplemental 
funding to support emergency, one-time programs that are essential to 
the success of some of our highest foreign policy priorities.
    This money will do more than support our diplomacy; it will 
strengthen our national security. America today is a nation at war. We 
are engaged in a long conflict against terrorists and violent 
extremists. Across the world, the members of our Foreign Service, Civil 
Service, and our Foreign Service Nationals are advancing America's 
diplomatic mission, often working in dangerous places far away from 
their friends and loved ones. Our Nation's men and women in uniform are 
also shouldering great risks and responsibilities. They are performing 
with courage and heroism, and many have made the ultimate sacrifice to 
secure our way of life. Today, I want to recognize these courageous 
public servants and their families, who endure long periods of service 
abroad and painful separation with fortitude.
    America's enemies remain eager to strike us again, but our actions 
in the past 4 years have weakened their capability. Our diplomacy plays 
a vital role in defeating this threat. We are building partnerships 
with traditional allies and with new partners that share our perception 
of the threat. Most importantly, we are working directly with foreign 
citizens who wish to build thriving free societies that replace hatred 
with hope.
    Mr. Chairman, I would now like to offer an overview of the current 
mission of the men and women of the State Department--a mission that we 
have called transformational diplomacy.

                A NEW DIPLOMACY FOR A TRANSFORMED WORLD

    In his second inaugural address, President Bush laid out the vision 
that leads America into the world: ``It is the policy of the United 
States to seek and support the growth of democratic movements and 
institutions in every nation and culture, with the ultimate goal of 
ending tyranny in our world.''
    The President's vision stems from the recognition that we are 
living in an extraordinary time, one in which centuries of 
international precedent are being overturned. The prospect of violent 
conflict among great powers is more remote than ever. States are 
increasingly competing and cooperating in peace, not preparing for war. 
Peoples in China, India, South Africa, Indonesia, and Brazil are 
lifting their countries and regions to new prominence. Democratic 
reform has begun in the Middle East. And the United States is working 
with our democratic partners in every region of the world, especially 
our hemispheric neighbors and our historic treaty allies in Europe and 
Asia, to build a true form of global stability: A balance of power that 
favors freedom.
    At the same time, other challenges have assumed new urgency. The 
greatest threats today emerge more within states than between them, and 
the fundamental character of regimes matters more than the 
international distribution of power. It is impossible to draw neat, 
clear lines between our security interests, our development goals, and 
our democratic ideals in today's world. Our diplomacy must integrate 
and advance all of these goals together.
    So I would define the objective of transformational diplomacy this 
way: To work with our many partners around the world to build and 
sustain democratic, well-governed states that will respond to the needs 
of their people and conduct themselves responsibly in the international 
system. This is a strategy rooted in partnership, not paternalism--in 
doing things with other people, not for them. We will use America's 
diplomatic power and our foreign assistance to help foreign citizens 
better their own lives, build their own nations, transform their own 
futures, and work with us to combat threats to our common security, 
including the spread of weapons of mass destruction.

                 PRACTICING TRANSFORMATIONAL DIPLOMACY

    Faced with such extraordinary challenges, we must transform old 
diplomatic institutions to serve new diplomatic purposes, and we must 
empower our people to practice transformational diplomacy. With the 
generous support of the Congress, my good friend and predecessor, Colin 
Powell, brought American diplomacy into the 21st century. Now, my 
leadership team and I are building on this strong foundation and 
beginning the generational work of transforming the State Department. 
This will not only strengthen national security, it will improve our 
fiscal stewardship. We are committed to using American taxpayers' 
dollars in the most effective and responsible way possible to 
strengthen America's mission abroad.
    In the past year, we have begun making changes to our organization 
and our operations that will enable us to advance transformational 
diplomacy. We are forward-deploying our people to the cities, 
countries, and regions where they are needed most. We are starting to 
move hundreds of diplomats from Europe and Washington to strategic 
countries like China, India, South Africa, and Indonesia. We are giving 
more of our people new training and language skills to engage more 
effectively with foreign peoples. We are enabling our diplomats to work 
more jointly with America's service men and women. And I have announced 
that I am creating a new position of Director of Foreign Assistance. 
This reform will transform our capability to use foreign assistance 
more efficiently and more effectively to further our foreign policy 
goals, to bolster our national security, to reduce poverty, and to 
improve people's lives around the world.
    We are making the initial changes using our existing authority, and 
the additional funding we are requesting in the FY 2007 budget will 
help us continue implementing our vision to transform the State 
Department to meet the challenges of the 21st century. For this 
purpose, we are requesting $9.3 billion for State Department 
operations.
    Transformational diplomacy begins with our people--ensuring that 
they are in the right places, with the necessary tools and training to 
carry out their mission. We are requesting $23 million for 100 new 
positions on the new frontlines of our diplomacy: Key transitional 
countries and emerging regional leaders in Africa, Latin America, the 
Middle East, and Asia. These new positions will complement the 100 that 
we are already repositioning as part of our ongoing effort to change 
our global diplomatic posture. This repositioning effort will require a 
renewed commitment to secure and modernize our many posts overseas, and 
we are seeking $1.5 billion for security-related construction and 
rehabilitation of our diplomatic facilities.
    In addition to requesting new positions, we will continue to invest 
in our people, our greatest resource. More and more, we are calling 
upon our diplomats to leave their families and serve at unaccompanied 
``hardship posts'' that now make up 20 percent of our yearly overseas 
assignments. With your help, as part of our effort to modernize the 
Foreign Service, we will institute a new pay-for-performance system 
that fairly compensates our men and women working abroad. We will also 
further our efforts to train America's diplomats to speak critical 
languages like Chinese, Urdu, and Arabic, which they will increasingly 
need, in addition to more traditional languages, as they progress in 
their careers. New training will also make full use of dynamic new 
technologies, and we are asking for $276 million to integrate our 
workforce with the latest information technology and to support 
professional training needed for success.
    These new tools and training will better enable our Nation's 
diplomats to tell America's story to the people of the world, and in 
turn, to listen to the stories they have to tell. We have heard the 
legitimate criticisms that have been made of our public diplomacy, and 
we are rethinking how we do business. I have stressed that public 
diplomacy is the responsibility of every single member of our 
diplomatic corps, not just our public diplomacy specialists. One idea 
we are beginning to implement is the creation of forward-deployed, 
regional public diplomacy centers. These centers, or media hubs, will 
be small, lean operations that work out of our embassies or other 
existing facilities, enabling us to respond quickly to negative 
propaganda, to correct misinformation, and to explain America's 
policies and our principles. The $351 million that we seek will be 
essential for us to continue revitalizing our public diplomacy.
    To complement our public diplomacy, we must ensure that America 
remains a welcoming place for all tourists, students, and 
businesspeople, while at the same time protecting our homeland from 
terrorists and criminals who would exploit our open society to do us 
harm. The State Department, in partnership with the Department of 
Homeland Security, has taken new steps in the past year to realize the 
President's vision of secure borders and open doors through information 
technology. Our request of $1.1 billion will fund the Border Security 
Program and enable us to hire 135 new consular officers and passport 
staff to meet the growing demand of foreign citizens seeking to travel 
to America, while maintaining our fundamental commitment to serve each 
and every American citizen when they go abroad. At the same time, we 
are seeking $474 million to support our educational and cultural 
exchanges, which increase mutual understanding between our citizens and 
the peoples of the world.
    Finally, we must continue to enable our Nation's diplomats to work 
effectively with their partners in the United Nations and other 
international organizations. We seek $1.6 billion to fund U.S. assessed 
and voluntary contributions to international organizations. The United 
States takes our international obligations seriously, and we remain 
committed to strengthening the financial stability, efficiency, and 
effectiveness of international organizations.

                 DEFEATING TERROR AND ADVANCING LIBERTY

    The President's FY 2007 budget will help prepare the men and women 
of the State Department to meet the goals of transformational 
diplomacy. Our principal objectives are to stem the tide of terrorism 
and to help advance freedom and democratic rights.
    We are requesting $6.2 billion to strengthen the coalition partners 
who are standing shoulder to shoulder with us on the front lines in the 
fight against terrorism. Our assistance empowers our partners to 
practice more effective law enforcement, police their borders, gather 
and share essential intelligence, and wage more successful 
counterterrorism operations. In many states, our assistance will also 
help to bolster thriving democratic and economic institutions reducing 
the societal schisms that terrorists exploit for their own ideological 
purposes. Our FY 2007 request includes, among others, $739 million for 
Pakistan, $560 million for Colombia, $154 million for Indonesia, $457 
million for Jordan, and $335 million for Kenya.
    Essential to winning the war on terrorism is denying our enemies 
the weapons of mass destruction that they seek. Our diplomacy cannot 
focus on nonproliferation alone; we must also develop new tools and new 
policies of counterproliferation: Actively confronting and rolling up 
the global networks involving rogue states, outlaw scientists, and 
black-market middlemen who make proliferation possible. We are building 
on the achievements of the Proliferation Security Initiative, the G-8 
Global Partnership, and U.N. Security Council Resolution 1540. We are 
working to stop Iran and North Korea from succeeding in their quest for 
weapons of mass destruction, and we continue to do everything in our 
power to deny terrorists access to the world's most dangerous weapons, 
including threatening conventional weapons like MANPADS. The FY 2007 
budget proposes to increase funding for our State Department's efforts 
to help countries fight the proliferation of dangerous weapons and 
materials.
    These requirements are essential and immediate, but our vision must 
look beyond present horizons. To defeat the threat of terrorism, we 
must work to build a future of freedom and hope. As President Bush has 
said, in the long run, liberty and democracy are the only ideas 
powerful enough to defeat the ideology of hatred and violence. Freedom 
is on the march today all around the world, and the United States must 
continue to open a path for its expansion, especially in Iraq and 
Afghanistan.
    In December, over 12 million Iraqi people voted in free elections 
for a democratic government based on a constitution that Iraqis 
themselves wrote and adopted. Through their actions, the overwhelming 
majority of Iraqis are demonstrating that they support freedom and 
oppose terrorism. The democratic government that is taking shape in 
Baghdad today should support human rights, foster new opportunities for 
prosperity, and give all Iraqis a stake in a free and peaceful future. 
It should separate stalwart Iraqis from the purveyors of terror and 
chaos. Iraq is on a track of transformation from brutal tyranny to a 
self-reliant emerging democracy that is working to better the lives of 
its people and defeat violent extremists.
    Although Iraqis are undertaking this work themselves, international 
assistance remains essential to Iraq's success. United States 
assistance is helping Iraqis to build their security capabilities, 
empowering civil society and democratic institutions, increasing and 
improving the production and availability of electricity, distributing 
millions of new textbooks, providing access to clean water for millions 
of Iraqis, and helping protect millions of Iraqi children from disease.
    The President's request of $771 million, along with the forthcoming 
supplemental request, is an essential part of our National Strategy for 
Victory in Iraq. The funding for the Department's operations and 
programs is a critical counterpart to the efforts of our troops in the 
field as we pursue our integrated security, economic, and political 
tracks to success in Iraq. The supplemental request will fund programs 
that are integral to our counterinsurgency campaign and to the 
operating and security costs of our diplomatic mission, while the FY 
2007 request supports capacity development essential for Iraq's 
transition to self-reliance. The money requested by State will allow us 
to work effectively with our Iraqi partners to advance our strategy of 
``Clear, Hold, Build''--clearing areas of insurgent control, holding 
newly gained territory under the legitimate authority of the Iraqi 
Government, and building economic infrastructure and capable national 
democratic institutions that are essential to Iraq's success.
    Our work also continues in Afghanistan. After the United States, 
along with our allies and friends, removed the Taliban regime, the 
Afghan people set out to liberate themselves. They did so with the 
international community by their side. And today, the Afghan people 
have achieved the ambitious vision that we all set together 4 years ago 
in Bonn, Germany: A fully functioning, sovereign Afghan Government. 
This government was established through successful Presidential and 
parliamentary elections, in which millions of men and women voted 
freely for the first time. Today, Afghanistan has a democratic 
constitution; an emerging free economy; and a growing, multiethnic army 
that is the pride of the Afghan people.
    Despite this dramatic progress, there is still much hard work to be 
done. President Bush's request of $1.1 billion for Afghan 
reconstruction, along with supplemental funding to be requested, will 
allow us to continue helping the people of Afghanistan meet the 
remaining political, economic, and security challenges they face. With 
your continued support, along with help from NATO, the United Nations, 
and all other contributors from the international community, we can 
help the Afghan people complete their long journey toward a future of 
hope and freedom.
    The people of Iraq and Afghanistan are helping to lead the 
transformation of the Broader Middle East from despotism to democracy. 
This is a generational challenge, in which elections are an important 
and necessary beginning. The freedom to choose invests citizens in the 
future of their countries. But as President Bush has said, one election 
does not establish a country as a democracy. Successful democracies are 
characterized by transparent, accountable institutions of governance; a 
thriving civil society that respects and protects minority rights; a 
free media; opportunities for health and education for all citizens; 
and the official renunciation of terrorism and ideologies of hatred. On 
this last point especially, we will continue to insist that the leaders 
of Hamas must recognize Israel, disarm, reject terrorism, and work for 
lasting peace. Helping the nations of the Broader Middle East to make 
progress in building the foundations of democratic societies is the 
mission of the Middle East Partnership Initiative, for which we are 
seeking $120 million. We are also requesting $80 million for the 
National Endowment for Democracy to continue its good work in promoting 
lasting democratic change all around the world.
    The progress of the Broader Middle East is hopeful, but it still 
faces determined enemies, especially the radical regime in Tehran. Iran 
is a strategic challenge to the United States, and we have a 
comprehensive view of the threat that Iran poses. The regime is seeking 
to develop nuclear weapons. It is a leading state sponsor of terrorism. 
It is working to destabilize its region and to advance its ideological 
ambitions. And the Iranian Government oppresses its own people, denying 
them basic liberties and human rights. Through its aggressive and 
confrontational behavior, Iran is increasingly isolating itself from 
the international community.
    In recent months, U.S. diplomacy has broadened the international 
coalition to address Iran's nuclear ambitions, and Iran's case will 
soon be heard in the U.N. Security Council. Our goal now is to broaden 
this coalition even further, to intensify the international spotlight 
and encourage our many international partners to respond to the full 
spectrum of threats that the Iranian regime poses.
    For our part, the United States wishes to reach out to the Iranian 
people and support their desire to realize their own freedom and to 
secure their own democratic and human rights. The Iranian people should 
know that the United States fully supports their aspirations for a 
freer, better future. Over the past 2 years, the Department of State 
has invested over $4 million in projects that empower Iranian citizens 
in their call for political and economic liberty, freedom of speech, 
and respect for human rights. We are funding programs that train labor 
activists and help protect them from government persecution. We are 
working with international NGOs to develop a support network for 
Iranian reformers, political dissidents, and human rights activists. We 
will devote at least $10 million to support these and other programs 
during this year (FY 2006), and we are eager to work more closely with 
Congress to help Iranian reformers build nationwide networks to support 
democratic change in their country.

                       MEETING GLOBAL CHALLENGES

    Like terrorism and nuclear proliferation, many of the greatest 
challenges in today's world are global and transnational in nature. 
These threats breach even the most well-defended borders and affect all 
nations. Today's global threats require global partnerships, and 
America's diplomats are helping us transform our relationships with 
countries that have the capacity and the will to work on a global basis 
to achieve common purposes--countries like India, Japan, South Korea, 
Australia, El Salvador, and our allies in Europe.
    One major global threat comes from disease, especially the scourge 
of HIV/AIDS. This pandemic affects key productive members of societies: 
The individuals who drive economies, raise children, and pass on the 
customs and traditions of their countries. The United States is 
committed to treating people worldwide who suffer from AIDS because 
conscience demands it, and also because a healthier world is a safer 
world. The hallmark of our approach is the President's Emergency Plan 
for AIDS Relief. This program is the largest international initiative 
ever by one nation to combat a single disease. The Emergency Plan 
combines our strong bilateral programs with complementary multilateral 
efforts to fight AIDS and other debilitating infectious diseases 
through contributions to the Global Fund to Fight AIDS, Tuberculosis, 
and Malaria, of which America is by far the largest contributor since 
the program's inception.
    The Emergency Plan is rooted in partnership. Our approach is to 
empower each nation to take ownership of its own fight against HIV/AIDS 
through prevention, treatment, and care. The results to date have been 
remarkable. In the past 2 years, the Emergency Plan has expanded life-
extending antiretroviral treatment to 471,000 people worldwide, 400,000 
of whom are located in sub-Saharan Africa. And as of last year, the 
Emergency Plan has extended compassion and care to more than 1.2 
million orphans and vulnerable children. The President's 2007 budget 
requests $4 billion, $740 million more than this year, to continue 
America's leadership in the global fight against HIV/AIDS.
    The 2007 budget also includes $225 million to fight malaria, which 
is a major killer of children in sub-Saharan Africa. This request is 
part of the President's pledge to increase U.S. funding of malaria 
prevention and treatment by more than $1.2 billion over 5 years. The 
United States is committed to working with the international community 
to increase preventive and curative programs in 15 African countries 
with particularly high rates of infection by 2010. We seek to reduce 
malaria deaths by 50 percent in these countries after 3 years of full 
implementation.
    The United States is also playing a key global role in preparing 
for the threat of a possible avian influenza pandemic--providing 
political leadership, technical expertise, and significant resources to 
this effort. In September 2005, President Bush announced the 
International Partnership on Avian and Pandemic Influenza. The 
partnership, which includes 89 countries and 9 international 
organizations, generates political momentum and coordinating action 
among all partners. At the January 2006 International Pledging 
Conference on Avian and Pandemic Influenza held in Beijing, the United 
States pledged $334 million in current budget authority to protect 
health in the United States and around the world. The most effective 
way to protect the American population from an influenza outbreak is to 
contain it beyond our borders. The 2007 budget provides resources to 
continue these activities in countries already experiencing outbreaks 
of influenza and in other countries on the cusp of infection.
    Another key global challenge is to curtail the illicit drug trade 
and to dissolve the relationships between narco-traffickers, 
terrorists, and international criminal organizations. The 2007 budget 
requests $722 million for the Andean Counterdrug Initiative, which 
advances the President's goal of strengthening democracy, regional 
stability, and economic development throughout the hemisphere. The 
initiative provides funding for law enforcement, security programs, and 
alternative livelihood assistance for those at risk from the trade of 
illicit narcotics.
    Finally, as we transform our diplomacy to meet the increasingly 
global challenges of the 21st century, the United States remains 
committed to putting the power of our compassion into action wherever 
and whenever it is needed. In 2005, the United States led the world 
with our generous emergency responses to people suffering from 
unprecedented natural disasters--from the Indian Ocean tsunami, to the 
earthquake in Pakistan, to the mudslides in Central America. Our swift 
action has helped to provide relief, to prevent the spread of disease, 
and to begin restoring livelihoods and rebuilding these devastated 
regions. The United States remains the world's most generous provider 
of food and other emergency humanitarian assistance. Throughout the 
world, we are also helping refugees to return to their countries of 
origin. When that is not a viable option, the United States leads the 
international community in resettling refugees here in our Nation. The 
FY 2007 request of $1.2 billion for humanitarian relief, plus $1.3 
billion in food aid, will ensure that we are prepared to extend the 
reach of American compassion anywhere in the world.

                 THREE GOALS OF U.S. FOREIGN ASSISTANCE

    The United States will continue to build strong partnerships to 
meet the global challenges that increasingly define international 
security in the 21st century. But we recognize that many states cannot 
meet the basic responsibilities of sovereignty, including just and 
effective control over their own territory. In response, the United 
States must assist the world's most vulnerable populations through our 
transformational diplomacy--using our foreign assistance and working 
with our partners to build state capacity where little exists, help 
weak and poorly governed states to develop and reform, and empower 
those states that are embracing political and economic freedom. These 
are three main goals of our country assistance programs, with the 
ultimate purpose being ``graduation'' from foreign economic and 
governance assistance altogether. Vibrant private sectors in free, 
well-governed states are the surest form of sustainable development.

Building state capacity
    We must do all we can to anticipate and prevent the emergence of 
failed states that lead to humanitarian crises, serious regional 
instability, and havens for terror and oppression that threaten our 
security. On September 11, we were attacked by terrorists who had 
plotted and trained in a failed state: Afghanistan. Since then, we have 
spent billions of dollars and sacrificed precious lives to eliminate 
the threat and liberate the brutally repressed people of Afghanistan. 
We must use all the tools and resources available not only to prevent 
future failed states, but to help nations emerging from conflict and 
war to become responsible, democratic states.
    The Office of the Coordinator for Reconstruction and Stabilization 
was established to address complex and challenging situations around 
the globe. Partnering with the international community, we will help 
countries in crisis achieve a path to lasting peace, good governance, 
and economic development. Working in conjunction with our lead regional 
bureaus, our Reconstruction and Stabilization Office is already 
beginning to advance this mission in the field. It deployed a team to 
Sudan to assess the effectiveness of our assistance programs in 
implementing the Comprehensive Peace Agreement, in negotiating a 
political settlement in Darfur, in delivering humanitarian assistance, 
and in establishing security. As a result of these assessments and 
planning efforts, U.S. resources have been allocated more effectively 
to help people in need in Sudan. Our office has also helped the Haitian 
people take a decisive step toward a better future, pinpointing 
problems with voter registration and the electoral council in time for 
them to be remedied before last week's historic elections.
    The 2007 budget proposes to strengthen this Office's ability to 
lead U.S. planning efforts for countries and regions of most concern, 
and to coordinate the deployment of U.S. resources when needed. The 
budget proposes $75 million, including a Conflict Response Fund to 
build our civilian response capabilities, to prevent failing states, 
and to respond quickly and effectively to states emerging from conflict 
around the world. With an early and effective civilian response, we can 
reduce the need for a more robust and costly military commitment by 
more quickly shifting responsibility for key functions to civilian 
actors.
    Our efforts to build state capacity continue in Sudan. The need for 
security is of the utmost importance to this effort, and the 
Comprehensive Peace Accord (CPA) points the way forward. The CPA, which 
ended 22 years of North-South civil war in Sudan, is the framework for 
resolution of conflict throughout Sudan. The CPA created a Government 
of National Unity that shares power and wealth, and establishes 
elections at every level by 2009.
    Implementing the CPA is essential to ending the genocide in Darfur. 
The United States is appalled by the ongoing atrocities that have 
persisted in Darfur, and we continue to lead the ongoing international 
effort to aid the region's displaced people, assisting over 1.8 million 
internally displaced persons and over 200,000 Sudanese refugees in 
Chad. I ask for your full support of the President's upcoming 
supplemental request, which will include support for the African Union 
and for transition to a U.N. peacekeeping mission to bring peace to 
this war-torn area. We are requesting $1.1 billion in the FY 2007 
budget to transition to peace in Sudan, meet humanitarian needs, lay 
the foundations for economic development, and strengthen sustainable 
democratic institutions.
    We are also continuing to partner with the people of Haiti to 
advance the cause of freedom and build lasting foundations of a 
democratic state. Just last week, the people of Haiti held fair and 
free elections. We now look forward to working with the citizens of 
Haiti, their newly elected government, and the international community 
to help Haiti chart a positive path of freedom and prosperity by 
strengthening good governance, improving security and the rule of law, 
fostering economic recovery, and addressing critical humanitarian 
needs.
    As is evident by the hard work and sacrifice of the U.N. 
peacekeepers in Haiti, international peacekeeping missions carried out 
by the United Nations and partner organizations are essential to 
creating the secure conditions conducive for democratic elections and 
basic state capacity. The $1.3 billion request for these efforts 
worldwide is also crucial to facilitating the delivery of humanitarian 
relief and providing a stable political and economic environment that 
fosters democratic institutions and development. To continue to provide 
well-trained, effective peacekeepers that understand and respect human 
rights, I am requesting over $100 million for the third year of the 
Global Peace Operations Initiative to train and equip 75,000 troops by 
2010. Current missions and capacity-building efforts increase our 
security at home and provide relief to the heroic troops in our own 
Armed Forces.

Helping developing states and the most vulnerable populations
    Where the basic foundations of security, governance, and economic 
institutions exist, the United States is advancing bold development 
goals. Under President Bush, the United States has embarked on the most 
ambitious development agenda since the Marshall Plan, including a new 
debt relief initiative, the doubling of Official Development Assistance 
since taking office, and funding for the international financial 
institutions that is linked to performance. Development is an integral 
pillar of our foreign policy. In 2002, for the first time, the 
President's National Security Strategy elevated development to the 
level of diplomacy and defense, citing it as the third key component of 
our national security. States that govern justly, invest in their 
people, and create the conditions for individual and collective 
prosperity are less likely to produce or harbor terrorists. American 
diplomacy must advance these development principles.
    U.S. development assistance focuses on building the tools for 
democratic participation, promoting economic growth, providing for 
health and education, and addressing security concerns in developing 
nations, while at the same time responding to humanitarian disasters. 
Such investments are crucial to improving the lives of people around 
the world and enhancing our own national security. At the same time, we 
must invest in reform in countries so that these efforts will not go to 
waste, but provide both the necessary tools and the right incentives 
for host governments to secure the conditions necessary for their 
citizens to achieve their full potential.
    Relieving the burden of heavily indebted countries is essential to 
ending a destabilizing lend-and-forgive approach to development 
assistance for poorer countries and allowing these countries to 
progress on the road to prosperity. At the Gleneagles summit last July, 
the G-8 agreed on a landmark initiative to provide 100 percent 
cancellation of qualifying Heavily Indebted Poor Countries' debt 
obligations to the World Bank, the African Development Bank, and the 
International Monetary Fund. U.S. leadership was instrumental in 
securing this agreement. We estimate that a total of 42 countries will 
receive up to $60 billion in debt relief as a result of this 
initiative. The budget that I present to you today fully supports the 
U.S. share of the multilateral debt forgiveness provided by the G-8 
proposal.
    The United States and our G-8 partners went much further than 
relieving debt. I ask you to go much further as well and support our 
Government's commitment for the most ambitious package for Africa ever 
supported by the G-8. This package will fight malaria, HIV/AIDS, and 
corruption and help create an environment where democracy and economic 
opportunity can flourish. Specifically, the 2007 budget supports the 
President's commitment to double our assistance to Africa between 2004 
and 2010. In addition, the request supports the U.S. Government's 
commitment to help African countries to build trade capacity; to 
educate their citizens through the 4-year, $400 million Africa 
Education Initiative; and to combat sexual violence and abuse against 
women through a new Women's Justice and Empowerment Initiative.
    Although Africa is a focus of our efforts to reduce poverty and 
invest in people and reform, it is by no means the only continent on 
which our resources are directed. We seek a total of $2.7 billion for 
Development Assistance and Child Survival and Health funds. By 
investing in the citizens of developing countries, we are investing in 
the future of the American people.

Empowering transformational states
    The final goal of our country assistance programs is to empower 
those states that are governing justly and to help them address key 
constraints to their economic growth and poverty reduction. The 
flagship of our efforts is the Millennium Challenge Account, which is 
helping states that are making measurable progress to achieve 
sustainable development and integration into the global economy.
    In 2002, in Monterrey, Mexico, the nations of the world adopted a 
new consensus on how to reduce international poverty. Developed nations 
agreed to dramatically increase their amount of assistance to 
developing countries, and developing countries committed to making 
progress toward good governance, economic freedom, and an investment in 
the health and education of their people. In response to this Monterrey 
Consensus, our administration and the Congress created the 
revolutionary Millennium Challenge Account, which targets billions of 
dollars in new development assistance to countries that meet benchmarks 
of political, economic, and social development. This innovative 
approach partners with and invests in low and lower middle income 
countries that take ownership for their own sustainable development and 
poverty reduction.
    In the past year, we have accelerated our efforts to negotiate and 
sign development compacts between transformational countries and the 
Millennium Challenge Corporation. To date, the MCC has identified 23 
countries eligible for development compacts, and we have approved 
compacts worth a total of $1.5 billion with eight countries: Armenia, 
Benin, Cape Verde, Georgia, Honduras, Madagascar, Nicaragua, and 
Vanuatu. Nine eligible countries have prepared proposals totaling $3.1 
billion, and another six will soon submit proposals of their own. We 
are seeking $3 billion of new funding in the FY 2007 budget, with the 
goal of approving up to 10 new compacts.
    As important as our foreign assistance is, free trade is ultimately 
the key to every country's sustained development and economic growth. 
As the President stressed in the State of the Union, promotion of free 
trade is essential to enhancing the prosperity of the American people 
and to supporting developing countries in their effort to participate 
fully in the global economy. The Bush administration has signed or 
negotiated free trade agreements with Chile, Singapore, Jordan, 
Bahrain, Oman, Morocco, Australia, five Central American countries plus 
the Dominican Republic, and most recently, Peru. Fostering free trade 
is a vital part of our development policy. In the past 5 years, the 
United States has more than doubled our investment in helping 
developing countries to trade freely and competitively in the global 
economy. We pledged at the recent WTO ministerial in Hong Kong to 
increase this assistance to $2.7 billion by 2010, and our FY 2007 
request for trade-related development assistance will be an important 
step toward that ambitious and hopeful goal.
    Mr. Chairman, America's purpose in this young century is to marry 
our democratic principles with our dramatic power to build a more 
hopeful world. Our purposes are idealistic, that is true; but our 
policies are realistic, and we are succeeding. President Bush and I 
have called upon the men and women of the State Department to practice 
transformational diplomacy, and they are rising to this challenge with 
enthusiasm and courage. They are helping our many partners around the 
world to build a future of freedom, democracy, and hope for themselves 
and their families.
    Realizing the goals of transformational diplomacy will require a 
sustained effort over the course of a generation. Most importantly, it 
will require a strong partnership with the Congress. We at the 
Department of State will do our part to use our existing authority to 
make our foreign assistance more effective and to enhance our ability 
to serve as responsible stewards of the American taxpayers' money. Our 
goal in establishing the new position of Director of Foreign Assistance 
is a first step. We welcome a dialog with Congress about how we can 
work together to improve America's foreign assistance further, enabling 
us to respond more quickly and more effectively to the world's 
development challenges. By making America's foreign assistance more 
efficient and more effective, we will help people around the world to 
improve their lives, we will strengthen the hope that comes with 
freedom, and we will advance our national security.

    The Chairman. Thank you very much, Secretary Rice.
    I'll begin the questioning period. And, as I mentioned, 
we'll have a 5-minute period. And I'll offer at least one 
pattern that people might want to employ. I'm going to ask 
three questions, and stop, and let you respond in that period 
of time.
    The first deals with Iran and the possibilities that the 
Iranians will not be cooperative. There has to be at least some 
credibility that we and the international community could 
effect sanctions or some action beyond the diplomacy in which 
we are now involved. So, I want to ask you, Is there currently 
vigorous discussion with potential partners in this situation--
namely, China and Russia and India, whose cooperation would be 
essential--at various levels of sanctions, particular types of 
sanctions that might be effective, that are least injurious to 
the world as a whole, but perhaps effective with regard to 
leadership of Iran?
    Second, we had hearings last week on reconstruction in 
Iraq. It was apparent to all Senators that income for Iraq, as 
well as technical assistance, will be needed for several years. 
And it is not clear how that is to be paid for. So, I would 
like for you to give some idea as to an intermediate program of 
financing for reconstruction and maybe a request for some 
estimate as to what other countries in the world might be 
willing to contribute--a quarter, a half--or how, in the 
postwar situation, with reconstruction and the building of a 
viable democracy, others may participate.
    Finally, in my opening statement I went into a long history 
of unfortunate cuts year by year throughout the 1990s in 
foreign assistance and support for the State Department and for 
diplomacy. The Bush administration has asked for more money. 
Last year, the Congress responded by cutting $2 billion. That 
was about the same as the response of the year before. So, I'm 
asking, I suppose, for how we can effect a strategy to try to 
bring about a better result, because the requests that you are 
now making are important. The public needs to know that, very 
frequently, at the end of the day, after several weeks and 
months of conferences, they do not occur. And we must be more 
successful.
    Could you respond to these issues?
    Secretary Rice. Thank you very much, Chairman Lugar.
    First of all, on Iran, I do think we've made a lot of 
progress in getting an international consensus. And it was a 
major breakthrough to have Russia and China agree that this 
belonged in the Security Council. And now that it is in the 
Security Council, and we have the weight of the Security 
Council, including the possibility of chapter 7 action, which 
could then give greater confidence and greater strength to IAEA 
efforts. I think we have a menu now of options that were not 
there when we were just in the IAEA Board of Governors.
    We are, indeed, in constant discussion with our colleagues 
about the course ahead. It will not surprise you that there are 
differences about when and where and how to employ sanctions, 
should they be needed. The first course, I think, will be to 
try to get to the Security Council and remind the Iranians that 
they are completely isolated. Their activities that were 
announced today--there are news stories today about enrichment 
and reprocessing having begun--they have now crossed a point 
where they are in open defiance of the international community. 
Under Secretary Burns will be in Europe next week for a meeting 
of the G-8. He will have discussions with his counterparts. 
Under Secretary Joseph has had discussions with his. And I, 
also, with mine.
    I think we want to keep our options a bit open on what 
specific measures we have to take, but let me be very clear, 
the international community is going to have to act, and act 
decisively, if Iran is to know that there is a consequence for 
their open defiance of the international community. And so, we 
are working on precisely that.
    In the first instance, we want to look at the effect on the 
international community, as a whole, of any actions that we 
take--economies and the like. But we also want to try and not 
hurt the Iranian people. And so, I think you will see us trying 
to walk a fine line in what actions we take.
    As to reconstruction, I think we've made progress on 
reconstruction, although I will say that the job was much 
bigger than any of us imagined, with the deteriorated state of 
the Iraqi infrastructure. I think none of us knew, for 
instance, that when we saw Baghdad lit up as a city, that, in 
fact, the country probably only had 50 percent of the 
generating power that it needed, but it was being mostly given 
to Baghdad; the rest of the country was in darkness, so to 
speak. We've evened that out. That has given greater demand--
there is greater demand from consumers for this.
    But, in specific answer to your question, we have made a 
lot of investments in the infrastructure. We think that many of 
them have taken hold, but we've been downscaling the kinds of 
infrastructure projects that we have. Reconstruction with a 
small ``r,'' rather than with a large ``R,'' is the way that 
I've been describing it. More in the provinces.
    And one way that we intend to support the new Iraqi 
Government is to have these provincial teams that can marry 
political and military and reconstruction expertise on a more 
local level. On a more national level, we have an extensive 
Ministry Assistance Team Program. We have requested funding--
some in base funding and some will come in supplemental 
funding--for what we would hope would be about a 2-year program 
to really help stabilize these important functions.
    But I am very actively, now, working to get support from 
Iraq's neighbors and also from other countries. I might note 
that Germany made its first contribution to the Iraqi 
Reconstruction Fund. It was a small contribution, but it was a 
breakthrough for Germany, and I hope we will get more support.
    Finally, on foreign assistance. Senator, I think we're just 
going to have to get out there and make the argument. America 
wants to be compassionate, I think. And part of this is 
compassion--what we do in HIV/AIDS, what we do in malaria 
prevention. But we also have to make the case to the American 
people that this is also about our own security and our own 
safety. We know what happened when Iraq--or when Afghanistan 
became a failed state, and we paid for that, and paid for that 
dearly, with terrorist attack after terrorist attack, 
culminating in the fall of the Twin Towers and the Pentagon on 
September 11. And so, I now have begun to talk about this as 
national security spending, because unless states are capable 
of governing themselves, governing their borders, fighting 
terrorism, dealing with the challenges of proliferation and 
terror, we will not be safer. And so, I've begun to talk about 
it in that way, and perhaps that will resonate with the 
American people.
    The Chairman. Thank you very much, Secretary Rice.
    Senator Biden.
    Senator Biden. Mr. Chairman, I would ask permission that I 
be able to submit some questions to the Secretary----
    The Chairman. Yes.
    Senator Biden [continuing]. Because the time is short.
    The Chairman. That will be true for each Senator, and we'll 
send those questions over for the record.
    Senator Biden. I thank you.
    Senator Biden. I am confused a little bit by the 
administration's policy on elections. And they think they have 
turned out well. I think it's been a near disaster. I have a 
series of questions relating to that.
    I'd like to start with Iran. Iran has watched North Korea 
cross the same boundaries. You and the President and others 
have said, ``We cannot accept another partial solution that 
does not deal with the entirety of the problem in Korea.'' And 
yet, we were told, last year, by the Director of Defense 
Intelligence Agency that North Korea can now arm a missile with 
a nuclear warhead. And so, when you talk about Iran, my 
question is this. Has there been--and you would not be able to 
discuss it, I suspect, openly--but has there been an analysis 
done as to what impact an oil embargo would have on Iran? Not 
just what impact it would have on us and other nations, but 
Iran is a net importer of refined oil products, and, according 
to what I have read, it would have a dramatic, dramatic 
negative impact. And, already, Ahmadinejad is preparing his 
people for the need for sacrifice. So, my question is, Has such 
analysis been done?
    Secretary Rice. Yes. We have been looking at analyses of 
the full range of potential sanctions.
    Senator Biden. The President said, ``We're sanctioned out 
with regard to Iran.'' I think that was his quote. Are there 
any sanctions of consequence on the table other than energy and 
the oil sector?
    Secretary Rice. Well, Senator, we are--we have heavily 
sanctioned Iran, obviously, after 1979, but the--there are 
still some measures that we might even be able to take on our 
own, and we're looking at those. Obviously, anything that we 
can do multilaterally will be much more effective. And I think, 
now, with the Security Council resolution--or Security Council 
venue for Iran, we will be able to begin those discussions.
    As I said to Senator Lugar, it is not easy. There is not--
there is not common view on when or how sanctions ought to be 
taken. But the Iranian regime is giving the world a very good 
set of reasons to take serious measures. And the more that they 
do, and the more that they isolate themselves, I think, the 
more you will see a willingness on the international community.
    If I could just say, on North Korea, I think there's one 
very important difference. For a variety of reasons, North 
Korea is an extremely isolated state that seems to revel in its 
isolation. And the Iranians have not been. They've been 
isolated from us, for a variety of reasons, but this is a state 
that trades with the world, that has the diplomatic relations 
with the world, that has a population that is sophisticated, 
that travels. I don't believe that the Iranians want to endure 
the kind of isolation that has been attendant to the North 
Korea policy.
    Senator Biden. In your absence, I complimented you and the 
President on your bringing the world together with regard to 
Iran.
    Now, you indicated that you want to work through some of 
the bureaucratic hurdles of the executive order that existed 
before you came to power, and since you've been in power, with 
regard to helping democratic movements inside Iran. You and I 
talked at some length about that a few years ago, when there 
was a democratic movement that was alive, and when Khatami was 
talking about wanting to have exchanges, everything from 
students on. Assuming there was such a metamorphosis again, is 
that something we would find in our interest to do?
    Secretary Rice. Well, I think we find it in our interest 
now to try and remove these bureaucratic hurdles and to see if 
we can't engage the Iranian population. And, in some ways, you 
could argue that they need it even more now, because they are 
being isolated by their own regime. The regime risks--the 
regime's policies risk the total isolation of Iran, and the 
Iranian people shouldn't have to suffer for that. And so, when 
I speak of these differences, you know, we learned, a little 
while ago, that we were unable, for instance, to publish the 
works of Iranian human rights activists in the United States 
because of some of our licensing requirements. And so, we want 
to look at some of those issues.
    Senator Biden. If there is any help you need from this 
committee on doing away with some of the, in my view, 
ridiculous impediments for trying to start, at least, the 
exchange of ideas--I would hope you would ask us.
    My last question relates to Darfur. I've been meeting with 
NATO officials, including the Supreme Allied Commander of NATO 
and his counterparts. There is a feeling within NATO, at least 
expressed to me, that if a country took a lead--i.e., the 
United States--in moving to insert a small NATO force within 
existing forces--we're training them now--that we could have a 
profound impact. Is there any intention on the part of the 
administration to try to have a bridge to the United Nations 
taking over this process that would involve NATO being more 
engaged, with actually having some small number of boots on the 
ground inserted within existing African Union forces now?
    Secretary Rice. Well, Senator, the United States was the 
country that first raised this in NATO. I remember raising it 
in NATO and asking for NATO participation in Darfur. We now 
have lent a planning element, as well as some lift, to the 
African Union forces that are there.
    We want to continue to do this within the context of the 
African Union. It is extremely important, for a variety of 
reasons, to have their support and to have the African Union 
have the lead ownership--I'm sure you understand why--in this 
mission.
    We are prepared to talk with our NATO counterparts about 
what more we can do to support the AMIS force. It's our view, 
at this point, that shoring up the AMIS forces until we can get 
the U.N. forces is a better option than trying to build three 
different forces--the AMIS forces, a bridge force, and then the 
U.N. force. You probably know we are president of the Security 
Council this month in the United Nations, and we are trying to 
use that presidency to get the resolution to really get going 
on the peacekeeping forces.
    Senator Biden. I'm not suggesting we build a third force. 
In meeting with AU officials, I have been told that they would 
welcome the placement of NATO forces within AU forces, not 
unlike we're doing with Iraqi forces. And that's what I'm 
talking about. I will lay out some questions in writing for 
you.
    Secretary Rice. Absolutely. And let me just say, we will 
work with NATO to try to enhance the capability of the AMIS 
force until a U.N. force can get on the ground.
    Senator Biden. I think we have to lead that.
    Secretary Rice. Yes.
    The Chairman. Thank you very much, Senator Biden.
    Senator Hagel.
    Senator Hagel. Mr. Chairman, thank you. Welcome, Secretary 
Rice.
    First, Mr. Chairman, I will like--and would submit 
additional questions, because of our time restrictions. I would 
appreciate having the opportunity to do that.
    Secretary Rice, I want to compliment you, your team. I 
think during your first year at State Department you have done 
what you had told a number of us when you were here before this 
committee a year ago, and that is to reach out to the 
international community, use the State Department career 
foreign policy diplomatic experts in a way that enhances our 
country and our foreign policy. I think you've done the kinds 
of things--at least in this Senator's opinion, it is critically 
important if we, in fact, are to deal with these great 
challenges that face the world--not just the United States; 
these are international challenges that will require 
international responses--and to build back those relationships, 
and to build back those institutions and strengthen the United 
Nations and strengthen the IAEA and other organizations that we 
are very much part of, I think, is absolutely critical.
    With that, I want to go to two general areas, back to the--
to Iran and to Hamas, and the Palestinian issue. You and I have 
had conversations in the past, as well as other members of this 
committee, and--about the regionalization of this issue of Iran 
or Iraq. We now find a new development in the Palestinian 
territories with a new government being formed. Iran is in the 
middle of all of this, as we know; and that further complicates 
your efforts. And it, I think, gives us, also, some 
opportunities, as well, because it gives us opportunities to 
reach out and--your specific points here about the budget 
request that will include focusing on young Iranians, next 
generation, in the Middle East, which is absolutely, probably, 
is critical to our future security, as any one thing.
    There was a story in the front page of the Wall Street 
Journal yesterday which you may have seen, a big, blaring 
headline, ``Iran Plays Growing Role in Iraq, Complicating 
Bush's Strategy.'' And if you didn't read it, let me just take 
one piece of this and then get to a question.
    Talks about, ``Iran's influence is most apparent in Iraqi 
politics where a Shi'ite-dominated coalition has just nominated 
a Prime Minister with very close ties to Iran, but it also 
emerges in many areas of Iraq--Iraqi life that get less notice. 
Iranian businessmen, for example, are some of the largest 
investors in restoring Iraq's shattered infrastructure; 
nonprofit groups from Iran providing basic health services that 
crumbled in the chaos following the U.S.-led invasion; Iraq's 
Shi'ite media are getting training from experts across the 
border in Iran.'' And it goes into considerably more detail.
    My question is this. As you reach out, and as you formulate 
policy and present that policy in the form of a budget and 
other explanations, I'd like to have you try to capsulate all 
of this, because Iran is the most powerful country in the 
Middle East. It is the most difficult. It, from their 
perspective, is sitting there with the United States military 
forces on both its east and west border. Israel has nuclear 
capability. Pakistan and India have nuclear capability. And as 
this is all thread together in the fabric of what we're trying 
to do to sort this out, if you could talk a little bit about 
how we're dealing with all of this--I hope we are now past the 
Chalabi days of relying on that crowd, or that kind of policy 
or direction. I note a significant difference, too, in the 
IAEA, versus where we were going into Iraq, when we essentially 
dismissed the IAEA and their inspectors, that they didn't know, 
when they were an apologist group for the Iraqis. I hope those 
days are over. It appears they are; that we're working closely 
with IAEA.
    And then I'm going to top it off with this question. This 
is an open hearing. I recognize that. And we'll probably have 
to take this up in a closed hearing, or at least in closed 
conversation, about any efforts to try and deal with the 
Iranians in an off-channel way. I am aware that an initiative 
was made in 2003 to the Iranians by this Government. And tell 
us what you can about that; not necessarily the 2003, but any 
initiative for the United States to be engaging the Iranians in 
some way--not negotiating, not diplomatic recognition. But I 
don't see, Madam Secretary, how things are getting better. I 
think things are getting worse. I think they're getting worse 
in Iraq. I think they're getting worse in Iran. I hope the 
Hamas development will start to develop in a different 
direction. But we are now at a point where sanctions, for 
example--Senator Biden asked the question--consequences. Have 
we thought through consequences of sanctions? What are we doing 
about sanctions? Have we thought through why that would even be 
a feasible option?
    Now, I've thrown a lot at you, but you like it that way, 
because you can pick and choose and not answer some of the 
things. [Laughter.]
    But I would appreciate getting a broader sense of this, 
because I do think it's all connected.
    Secretary Rice. Thank you, Senator.
    I do think your analysis that this is all connected is 
exactly right. Iran is, through its policies in the Middle 
East, probably our biggest strategic challenge as a single 
country, because Iran is pursuing policies in the Middle East 
that are 180 degrees counter to the kind of Middle East that we 
would build. You have to look only at their support for 
Hezbollah in Syria and Lebanon, their, sort of, sidekick with 
Syria with that relationship, even though Syria is under deep 
suspicion in the international community. That relationship has 
grown. Certainly, we have wanted the Iranians to have good 
relations with the Iraqis, their neighbors, but in a 
transparent way. And I think their relationships are not always 
transparent, because of Iranian activities, particularly in the 
south.
    So, you are right, there are major challenges there, but I 
think that we have to look at this in several bites. The first 
is, when we talk about Iraq and Iranian influence in Iraq, we 
need to recognize that, while there is Iranian influence in 
Iraq, there are also influences that are counter to that 
Iranian influence. And with the selection of Mr. Jaafari by the 
United Iraqi Alliance, the Shi'a group, they still have to go 
now through a process of government formation, and, indeed, 
even confirmation of the Prime Minister, with a block--or with 
people that are Sunni and Kurd and other movements, like the 
Allawi movement that won, also, large parts of the vote. And 
so, there is going to have to be, now, old-fashioned politics 
to come to some conclusion. So, I would not overstate Iranian 
influence by recognizing that it is diluted by a number of 
other forces and factors that are deeply suspicious of Iranian 
influence and of Iranian power.
    I would also note that in the region, if you look around 
the region, in the gulf countries and in other places, there is 
also suspicion of Iranian activities and Iranian behavior. And 
part of our goal has to be to have, with others who are 
concerned about Iranian behavior, a kind of common dialog and 
discussion about how to counter that Iranian behavior. And I'm 
going to go out to the gulf next week. I expect to have some of 
those conversations. Because no one wants to see a Middle East 
that is dominated by an Iranian hegemon, particularly one that 
has acquired nuclear weapons technology. And, in fact, the face 
of Iran now, President Ahmadinejad, has crystalized the concern 
of the international community about Iran, because he speaks in 
blunter ways about Iranian ambitions than did prior Iranian 
Governments.
    So, I think we have a number of levers. Leaving aside 
whatever we might do in the Security Council, in terms of 
consequences for Iran's behavior, we need to think of this as a 
strategic approach to many who are concerned about Iranian 
influence and growing Iranian influence.
    Finally, let me just note that, in the long term, I think 
that the Iranian geostrategic position doesn't look all that 
good. If you look at, now, a democratic Afghanistan that is, 
indeed, a good friend of the United States, a democratizing 
Iraq that is--I think will be a good friend of the United 
States, Iran finds itself in a different geostrategic situation 
than it found itself just several years ago. It will try to 
influence those events, it will try to influence those 
governments. But it's going to have, I think, a hard time, in 
democratic processes, being a dominant force.
    As to your question about contacts, the only contacts that 
have been authorized with the Iranians for this government are 
for our Ambassador in Afghanistan to have contacts with his 
counterpart. We think it's useful on counternarcotics. We think 
it's useful on issues of terrorism in Afghanistan. And so, Ron 
Newman is empowered to do that. Similarly, Zal--by the way Zal 
Khalilzad did that when he was in Afghanistan. We do it with 
the United Nations. Zal has similar guidance in Iraq. He can, 
as he sees fit--with guidance from here, he can encounter and 
talk to his counterpart. So, that is the way that we're dealing 
with those near-term places where we bump up against one 
another. I think any broader talks, I don't really see the 
point, because Iran's policies are so belligerent and so 
counter to our own that it's difficult to see what that 
conversation would be about. But in terms of Iraq and 
Afghanistan, we do have channels that we can use.
    Senator Hagel. Thank you very much.
    The Chairman. Thank you very much, Senator Hagel.
    Senator Boxer.
    Senator Boxer. Thank you, Mr. Chairman.
    Madam Secretary, the President said, during his State of 
the Union Address, that we are winning in Iraq and he is 
confident in his plan for victory. Unfortunately, the American 
people don't share this confidence. A recent NBC/Wall Street 
Journal poll conducted January 26 through 29, 2006, shows that 
a majority of Americans--52 percent--believe the President has 
failed to give good reasons why the United States must keep 
troops in Iraq. Similarly, 53 percent of Americans are less 
confident that Iraq will come to a successful conclusion. They 
don't share his confidence, because they see what is happening 
on the ground. They see brave men, like ABC's Bob Woodruff and 
his cameraman, seriously injured while trying to report on, 
``the good news coming out of Iraq.'' They see Jill Carroll, of 
the Christian Science Monitor, a young woman who went to Iraq 
to tell the story of the Iraqi people, kidnaped and begging for 
her life, and we pray for her safe return. And, of course, the 
death and the injuries keep climbing, up to 19,000 Americans 
either dead or wounded.
    This administration's rosy scenarios, like the VP's 
statement that the insurgency was in the last throes, your 
statement in 2005 that the insurgency has been dealt several 
blows, just don't match realities on the ground.
    The number of attacks against coalition troops, Iraqi 
security forces, and civilians increased by 29 percent last 
year. Let me give you specifics. Insurgents launched 34,000-
plus attacks in 2005, an increase of 8,000 from 2004. Last 
year, the number of car bombs more than doubled, from 420 to 
873. The number of suicide car bombs went from 133 to 411. 
Sixty-seven attackers wore suicide vests last year, up from 
seven in 2004. Roadside bombs increased from 5,000-plus to 
10,000-plus.
    Last week, a chart appeared in the New York Times depicting 
the extent of casualties just in one month. And I just want you 
to see this, because sometimes we don't recognize what's going 
on there. More than 800 people were killed as a result of the 
insurgency.
    And what do the Iraqi people think of all this? Sixty-four 
percent of Iraqis believe that crime and violent attacks will 
decrease when the United States redeploys out of Iraq. Perhaps 
more important, 73 percent of Iraqis believe there will be 
greater cooperation among Iraq's political factions when the 
United States redeploys.
    So, I say to you, if we're in Iraq to help the Iraqi 
people, then we ought to start listening to the Iraqi people 
and start a redeployment.
    Now, success in Iraq also depends greatly on the ability of 
our forces to better secure Iraq's oil infrastructure. Paul 
Wolfowitz told Congress, in 2003, ``We're dealing with a 
country that can finance its own reconstruction with oil, and 
relatively soon.'' That was another rosy scenario. The reality 
is, Iraq's oil production has dropped from prewar levels. And I 
want to show you a headline from the New York Times a little 
more than a week ago, ``Oil Graft Fuels the Insurgency.'' The 
Iraqi Finance Minister has estimated that insurgents receive 40 
to 50 percent of all oil smuggling profits in the country. So, 
not only is the oil not financing the reconstruction, it is 
financing the insurgency that is killing American troops.
    Our main reason for going to Iraq was to get rid of the 
WMD, or, as you said, ``not to wait for the smoking gun to 
become the mushroom cloud.'' That was a farce. And the truth is 
coming out. The CIA intelligence officer in charge of the 
Middle East intelligence from 2000 to 2005 wrote, 
``Intelligence was misused publicly to justify decisions 
already made.''
    Our standing in the world is low. According to the Pew 
Research Center--and the American people know it--two-thirds of 
Americans say there's less international respect for the United 
States than in the past. And when asked why, a strong majority, 
7 in 10 Americans, cite, ``the war in Iraq.'' The war in Iraq 
is bringing our standing down in the world. The American people 
are smart.
    Now, you have cited elections in the Middle East as a sign 
that, ``the neighborhood is changing.'' But is the neighborhood 
changing for the better? It doesn't appear so. You've admitted 
to being blindsided by the Hamas victory, saying, ``I've asked 
why nobody saw it coming. It does say something about us not 
having a good pulse.'' And I do appreciate your candor there. 
But this has become a pattern. This administration was shocked 
by Hamas, shocked by the election of the Iranian leader, 
shocked that Iraqis voted for conservative religious parties 
with ties to Iran instead of secular candidates like Ahmed 
Chalabi, whose party got not one single vote in the Iraqi 
Parliament. I remember when he sat behind the First Lady in 
2004 at the State of the Union Address. This administration 
seems to have a tin ear when it comes to the Middle East, and 
that tin ear is making us less safe.
    Secretary Rice, do you really believe that elections in the 
Middle East, where these kind of terrorists and extremists 
groups are being chosen--and I know Senator Biden went into who 
they are--do you think that's working to the benefit of the 
United States? And, in a broader sense, not just in the Middle 
East, but also in places like Bolivia and Venezuela, do you 
agree that nations throughout the world are electing more 
negative candidates who run against America?
    Secretary Rice. Well, Senator, if the option is not to hold 
elections, I think that would be a terrible----
    Senator Boxer. That wasn't my question.
    Secretary Rice. Well, no, you asked, so let me answer. I 
think if the option is not to hold elections and not to give 
people their say, then that's an untenable position for the 
United States.
    Senator Boxer. That wasn't my question.
    Secretary Rice. Senator, I would like to answer your 
question.
    Senator Boxer. Good.
    Secretary Rice. Now, the Middle East. The question assumes 
that there was somehow stability in the Middle East that we 
have somehow disturbed, that the false stability of dictators 
like Saddam Hussein, who put 300,000 people in mass graves, who 
twice attacked his neighbors, who used weapons of mass 
destruction, both against his neighbors and against his own 
population, that that false stability was preferable to the 
admittedly difficult course that the Iraqi people are now set 
on to try to learn to deal with their differences by compromise 
and politics rather than by repression. It assumes that it was 
preferable for the Palestinian people to live under the regime 
of Yasser Arafat, which was a regime of extraordinary 
corruption, and, indeed, incapable of governing the Palestinian 
territories in a way that spoke to the aspirations of the 
Palestinian people. It assumes that it was better for Syrian 
occupation of Lebanon to continue for more than 30 years, 
Syrian occupation that was----
    Senator Boxer. Madam Secretary, could I----
    Secretary Rice [continuing]. May I complete my answer?
    Senator Boxer [continuing]. Just interrupt----
    Secretary Rice. May I just complete my answer?
    Senator Boxer [continuing]. In a very positive way for you?
    Secretary Rice. May I just complete my answer?
    Senator Boxer. Well, no, because you are not answering the 
question.
    Secretary Rice. No, Senator. You asked me if I thought that 
the world was better now, and I'm telling you that I think it 
is.
    Senator Boxer. Well, I asked you exactly this. Are these 
elections that have been held, and the people that have been 
elected, including the leader of Iran--what is happening in 
Israel in the Palestinian side--I am asking you--Venezuela, 
Bolivia--they seem----
    Secretary Rice. And, Senator----
    Senator Boxer [continuing]. To elect----
    Secretary Rice [continuing]. I'm answering the question.
    Senator Boxer [continuing]. Anti-American candidates, is 
that working to the benefit of America?
    Secretary Rice. Senator----
    Senator Boxer. I'm not asking you the----
    Secretary Rice [continuing]. Senator----
    Senator Boxer [continuing]. Benefit of anybody else.
    Secretary Rice. Senator, I have to answer in the following 
way. Your question assumes that, had we not had elections, for 
instance, in Lebanon, where, indeed, Hezbollah won some seats, 
that the Lebanese people would be----
    Senator Boxer. That wasn't----
    Secretary Rice [continuing]. Better off.
    Senator Boxer [continuing]. My question.
    Secretary Rice. Or multicandidate elections in Egypt. Yes, 
I think that the elections have made the world, in a 
transitional state, a better place. And the United States is 
standing for its principles, which is that the people of the 
Middle East, the people of Latin America, ought to be able to 
choose their leaders.
    Now, there are times when elections turn out in ways that 
we would prefer that they did not. Clearly, the election of 
Hamas is a difficult moment in the prospects for peace between 
the Palestinians and the Israelis. But the Palestinian people 
got a chance to go to the polls and express their desire for 
change. They have done so. And now the international community 
will hold Hamas responsible for the policies that it 
undertakes. And I believe, as the Quartet does, that Hamas will 
have one choice, which is to make a choice to recognize the 
right of Israel to exist, to renounce violence, and to engage 
in a process that will lead to a two-state solution.
    In sum, Senator, when you have dealt with a Middle East 
that for 60 years had a freedom deficit, for 60 years where the 
United States turned a blind eye to the authoritarianism that 
was there, it is not surprising that perhaps the best-organized 
parties were extremist parties. But that isn't a reason to 
despair that elections have happened in the Middle East. It's 
not a reason to despair that the people of the Middle East have 
had an opportunity to express themselves. It is a call to work 
harder for the development of civil society, to work harder for 
the development of political parties that can occupy the 
middle. But I would not change a policy that affirms America's 
belief that people ought to have a right to choose.
    Senator Boxer. Mr. Chairman, I just must say one--wrap this 
up this way.
    I asked you, Do you agree that nations throughout the world 
are electing more negative candidates who run against America? 
OK, your answer is, ``Elections are great, and anyone who 
thinks that the world isn't better somehow doesn't want 
elections.'' I just want to say, because you attributed, in an 
oblique way to me, the fact that I thought the status quo was 
wonderful, is incorrect. You never answered this. And as we sit 
here today, American businesses are being burned down. Burned 
down. The Pew has just done a poll indicating that our standing 
in the world has never been lower. If you think this is good 
for America, that is fine. But I would say we need to do 
better. We need to get our message across. We need to have the 
people in these countries feeling good toward America and 
electing candidates that feel good about America, not 
candidates that stand up and say, ``Death to America,'' and 
``America is the Satan.'' And then we say, ``Oh, this is 
better''?
    So, I think there is a disconnect here, Mr. Chairman. And I 
hope that we will, in fact, change some of our policies so that 
we don't see that these elections keep electing people whose--
who run on these anti-American platforms. It doesn't make us 
safer. And I'm concerned about our people.
    Secretary Rice. Well, Senator, it assumes that the Middle 
East was safer when ideologies of hatred produced people that 
flew airplanes into our buildings on 9/11. The fact is that 
what we are reaping now is policies--the implications and 
outcomes of policies that for 60 years denied freedom in the 
Middle East. And we're just now on a path beginning to 
acknowledge and affirm the right of the people of the Middle 
East to have freedom.
    Yes, there are going to be some outcomes that are not 
perfect, from the American point of view. But I don't think 
that our policy can be, ``You can only have elections if you 
plan to elect American--or candidates that are friendly to 
America.''
    Senator Boxer. No one's suggested that, either.
    The Chairman. Thank you very much, Senator Boxer.
    With the cooperation of the committee, I would note that a 
quorum is present, and the committee will take a short recess 
to hold a business meeting.
    [Recess.]
    The Chairman. I thank the Secretary for this recess. We 
will now resume the hearing, and I will call upon Senator 
Chafee.
    Senator Chafee. Thank you, Chairman Lugar. And welcome, 
Secretary Rice.
    Following up on some of the conversations just taking 
place, if--one of the ramifications of these elections and 
democracies is that we don't talk to the winners; and that, I 
see as a problem, if we are not happy with the result. So, now 
we have--we're not talking to the Iranians, we're not going to 
talk to Hamas, we're not talking with the Venezuelans, we won't 
talk with the Bolivians. So, my question is, Do we support the 
delay of elections in Egypt? And if the Muslim Brotherhood were 
successful--if we do support those elections, and the Muslim 
Brotherhood are successful, will we not talk with Egypt?
    Secretary Rice. Thank you, Senator.
    Just let me note that we, of course, have a mission in 
Venezuela, and an Ambassador there who engages the Venezuelan 
Government very often and at many different levels. In terms of 
Bolivia, the Assistant Secretary for Western Hemisphere Affairs 
went to the inauguration of Mr. Evo Morales. And so I would 
just note that we do talk to these people.
    Where it comes to Iran, I would not put the Iranian 
election in the same category with elections that have been 
held in other places, because, of course, the Guardian Council 
decided who could run in that election, and then they held 
elections. I think calling that an election stretches the term 
in the way that we think about it.
    As to Egypt, no, we are disappointed that the elections 
have been postponed in Egypt. The Egyptians have said that this 
is because the municipalities were not ready to carry out 
elections, that the lists were not prepared, and so forth. But 
we are going to continue to press for the forward march of 
democratic values and democracy in Egypt. The multicandidate 
Presidential elections and parliamentary elections that were 
carried out, while not perfect, did change the composition of 
the Egyptian Government, the parliamentary elections, in a 
substantial way. It has been our policy--because the Muslim 
Brotherhood, as a party, is not legal in Egypt--to respect the 
laws of Egypt. I do think that, as elections go forward in 
these countries, that we are reaching out, within legal 
constraints, to the broadest possible range of candidates.
    Now, Hamas is in a different category. And I know you 
didn't ask about Hamas, specifically, but let me just mention, 
Hamas is a terrorist group. We have listed it as a terrorist 
group. We don't have discussions with terrorists. It is our 
hope that Hamas will take the signals from the international 
community that it is not acceptable to say that you want a 
peaceful life and then refuse to recognize the partner; and 
that is Israel. But we will not have contacts with Hamas, 
because we list it as a terrorist group. But there are any 
number of countries where we find the government with policies 
with which we do not particularly agree, with which we have 
contact, and intend to continue to.
    Senator Chafee. OK. We can argue about our level of our 
contact with these countries, whether it's Venezuela or 
Bolivians, but there's no doubt we're not talking to the 
Iranians, no doubt we're not talking with Hamas. And now my 
next question is, Considering our deep involvement in the Arab 
world, where does peace between the Israelis and Palestinians 
rank in our--in your national foreign policy priorities? And 
just recently, regarding the elections of Hamas, Dennis Ross, 
who was our lead negotiator for 12 years in the Middle East, 
under both Republican and Democratic administrations, said, 
``We had so many opportunities to stop this.'' And former 
President Bush, George H.W. Bush, envoy John Wolf concurred in 
this sentiment. So, why didn't we take advantage of these 
opportunities?
    Secretary Rice. Well, I don't know anybody who worked 
harder to try and work with the Palestinian Authority to help 
it reform----
    Senator Chafee. First of all, where does it rank in our 
priorities?
    Secretary Rice. It ranks extremely high, and certainly in 
the top very few things. I probably spend more time on this 
issue than almost any other. You know that I have been to the 
region several times. You know that I, personally, engaged to 
negotiate the Rafah movement and access agreement. And so----
    Senator Chafee. But you'll argue--you won't argue that 
whatever has happened has been disastrous. We have a terrorist 
organization winning elections.
    Secretary Rice [continuing]. I agree that this is a 
difficult moment for the peace process, but if Hamas will take 
the signals being given it by the international community as to 
what it will take to govern, it could, in fact, be a more 
positive development.
    I would also note, Senator, that, in this same period of 
time, the Israelis are now completely out of Gaza, out of four 
settlements in the West Bank, and have begun to dismantle 
outposts. So, these are----
    Senator Chafee. All very well and good, but Hamas has just 
won these elections. And Dennis Ross and John Wolf had said we 
missed opportunities. Do you disagree with that?
    Secretary Rice. Actually, Senator, I don't think that the 
United States of America is responsible for the election of 
Hamas. No; I don't. I think the--what has happened in the 
Palestinian territories----
    Senator Chafee. Dennis Ross and John Wolf are wrong.
    Secretary Rice. Well, I don't know precisely what they 
said. I'm going to see Dennis tomorrow, so I can ask him 
precisely what he said. But my----
    Senator Chafee. He'll probably say the summer of 2003, 
after the fall of Saddam--let me finish----
    Secretary Rice. Yes.
    Senator Chafee [continuing]. When Abu Mazen was elevated to 
Prime Minister, and there was a hudna, a cease-fire, for that 
whole summer, nothing was done. John Wolf was the envoy, and he 
said nothing was done to back up our commitments. And then, 
again, another opportunity, death of Yasser Arafat. Again, Abu 
Mazen elevated to Prime Minister--President.
    Secretary Rice. Senator, I just----
    Senator Chafee. And----
    Secretary Rice [continuing]. I just----
    Senator Chafee [continuing]. That's the whole summer--that 
whole year----
    Secretary Rice [continuing]. Senator, I just----
    Senator Chafee [continuing]. Of 2005----
    Secretary Rice [continuing]. I just beg to disagree.
    Senator Chafee. Nothing was done.
    Secretary Rice. I just----
    Senator Chafee. Nothing was done.
    Secretary Rice [continuing]. I'm sorry----
    Senator Chafee. Opportunities missed.
    Secretary Rice. I'm sorry, Senator----
    Senator Chafee. And now we have----
    Secretary Rice [continuing]. I just disagree.
    Senator Chafee [continuing]. A very, very disastrous 
situation of a terrorist organization winning elections.
    Secretary Rice. Senator, I just----
    Senator Chafee. That's what----
    Secretary Rice [continuing]. Beg to differ.
    Senator Chafee [continuing]. That's what Dennis Ross will 
say tomorrow----
    Secretary Rice. Well----
    Senator Chafee [continuing]. When you meet with him.
    Secretary Rice. I will ask him. But I have to say that 
people have been trying to make peace in the Middle East for a 
long time, including Dennis--and, of course, couldn't do it. 
And one reason that it wasn't possible when----
    Senator Chafee. It was never this bad.
    Secretary Rice. Well, we did have the 4 years of the 
intifada, which was pretty bad. A lot of Israelis died, a lot 
of Palestinians died. And so, we do have, now, a period in 
which Israelis have withdrawn from the Gaza, and the 
Palestinians have the ability to govern the Gaza, if they can. 
We have a situation in which they're withdrawing from parts of 
the West Bank. We have an agreement on movement and access for 
the Palestinian people, so that they can access the 
international border that is Rafah. There has been some 
progress.
    But as to the ability to deliver a two-state solution, 
Senator, people have been trying for a long time. And the one 
thing that has changed--and, I think, changed for the better--
is that the Yasser Arafat regime, which was corrupt and which 
was self-serving and which did not have the aspirations of the 
Palestinian people at its core--is now gone. What we witnessed 
in the victory of Hamas is a backlash against its residual, 
Fatah, which was also corrupt.
    And let me just say, Abu Mazen tried to do some good 
things. They reformed the Finance Ministry under Salam Fayyad. 
They did try to do some good things. The relations with Israel 
improved. They were able to deliver some goods for the people. 
But, ultimately, the Palestinian people voted for change, 
because the Fatah did not change quickly enough. That's the 
reason for Hamas's victory. And now, it is our hope that Hamas, 
having to govern, will understand what the international 
community has said to them.
    Senator Chafee. And we should get ready for the Muslim 
Brotherhood in Egypt, also.
    Secretary Rice. Well, Senator, again, I think that the 
option of not giving people a choice in who will govern them is 
just one that the United States of America can't stand for. 
We're dealing with 60 years of policies in the Middle East, not 
5. We're dealing with policies in the Middle East that created 
a freedom deficit. We're dealing with policies in the Middle 
East that supported authoritarian governments that then closed 
off legitimate political space for political parties to 
develop. And it is, perhaps, too much to expect that you are 
going to have, after a change in that policy, those political 
parties develop overnight. I, nonetheless, would rather go 
through a transition in places like Lebanon and even the 
Palestinian territories, certainly Iraq, Afghanistan, and other 
places, than to rest my hope for security in the false 
stability of authoritarian governments and dictatorships that 
cut off any opportunity for the people of the Middle East to 
legitimately express their views and their choices.
    Senator Chafee. Well, I agree with you, and I would wish 
that these elections would go toward more peaceful----
    Secretary Rice. Yes.
    Senator Chafee [continuing]. Advocating candidates. And 
that's our difference.
    The Chairman. Thank you very much, Senator Chafee.
    Senator Kerry.
    Senator Kerry. Thank you very much, Mr. Chairman.
    I really didn't expect to say anything on this subject at 
all, but I just wanted to pick up very quickly on what Senator 
Chafee said.
    Holding elections themselves, Madam Secretary, doesn't mean 
you have a democracy. An election does not mean democracy. And 
there was great intense desire on the part of Israel, as well 
as President Abbas, not to have that election at that period of 
time. And it was our insistence that the Palestinians proceed 
forward.
    I happen to agree with the position that you can't deal 
with Hamas. I mean, I think that's absolutely correct. You 
can't sit down with people, negotiate water rights and moving 
across the borders and all the other things, and people are 
blowing you up at the same time. So, I agree with that. But 
there really is a serious question here about the overall 
approach.
    I met with President Abbas the day he was elected--January, 
a year ago--and he looked at me, and he said, ``Senator, I know 
what the expectations are, but I don't have the capacity, I 
don't have police cars, I don't have radios, I don't have 
trained people, I don't have the ability to do what they expect 
of me, and I need help.'' And I've talked to Jim Wolfenson, as 
have others, and a lot of other people. And the bottom line is, 
I regret to say, the West--not just us--the West didn't come 
through. And Hamas had a greater ability to deliver in the 
streets a year and half ago than Fatah. Now, Fatah had its 
corruptions. We all understand that. But I believe that there 
is a measure of responsibility for the West's lack of adequate 
response with respect to trying to help. We're not responsible 
for the outcome, but we certainly are responsible for our 
actions in between.
    What I want to ask you--a number of questions, one about 
Iraq and--a couple about Iraq. But, before I do, we learned, 
last week, that Lewis ``Scooter'' Libby authorized--was 
authorized by his superiors--reportedly, Vice President Cheney; 
we don't know the answer--to leak classified information from 
the prewar national intelligence estimate on Iraq to the press 
in the summer of 2003. And my question is, Are you aware of any 
authorized leaks of classified information, or anyone 
instructing someone to leak classified information, to members 
of the press?
    Secretary Rice. Senator, this question has arisen in the 
context of a legal issue and an investigation, and I'm just not 
going to comment on anything related to the case of Scooter 
Libby.
    Senator Kerry. Well, can you tell us whether or not you 
have personally ever authorized the leak of classified 
information to any members of the press?
    Secretary Rice. Senator, this question, again, arises in 
the context of the Scooter Libby case----
    Senator Kerry. No, that arises in the context of your 
responsibilities within the White House at any time, or now. 
Have you ever authorized the leak of classified information to 
the press?
    Secretary Rice. I'm not going to talk about something that 
arises in the context of an investigation in a case. I have 
always acted lawfully within my duties as National Security 
Advisor and now as Secretary of State.
    Senator Kerry. Let me ask you this question. Do you support 
the practice of authorizing individuals to leak classified 
information to the press?
    Secretary Rice. Senator, I believe that the protection of 
classified information is one of our highest duties. I have 
always endeavored to protect classified information and to make 
certain that, if classified information is going to be used in 
any way, that procedures were followed, including procedures 
for making certain that the intelligence agencies were 
comfortable, or had agreed, that such information could be 
declassified. So----
    Senator Kerry. So, you do not support it?
    Secretary Rice. I've always followed the rules.
    Senator Kerry. You do not support the leaking.
    Secretary Rice. I believe that the protection of classified 
information is our highest--one of our highest duties.
    Senator Kerry. Thank you, Madam Secretary.
    The other day, General Kimmett, Mark Kimmett, gave a speech 
in London to the Institute of Strategic Studies wherein he 
reportedly said, ``The United States will not maintain any 
long-term bases in Iraq. Our position is, when we leave, we 
won't leave any bases there.'' I wrote to General Pace to 
follow up on this, and General Pace wrote me back and said, 
``At present, the Department of Defense has no plans for the 
permanent basing of U.S. forces in Iraq.''
    This has long been an issue of contention. So, you know, 
General Casey has said, ``The sense of American occupation is 
part of what feeds the insurgency.'' The administration, 
however, has never formally said, ``We're not going to have 
permanent bases.''
    So, I would ask you today, Is it, in fact, the policy of 
this administration not to have permanent basing in Iraq?
    Secretary Rice. I think General Pace has spoken to that, 
Senator, and he speaks for the administration.
    Senator Kerry. So----
    Secretary Rice. Senator, our job now is to use our forces 
to help the Iraqis gain control of their own security 
environment, to train their forces, to protect our people who 
need to go out in the field to be a presence outside of 
Baghdad. That is the purpose of our forces. As the President 
said, we don't want to be there one day longer than we need to 
be.
    Senator Kerry. I understand that. No, and we all want that 
transition. I'm just trying to figure out what the long term 
is, because I don't think the administration has actually said 
that before with clarity. So, if you are affirming, today, what 
the generals have said as the policy, that's a step forward.
    Secretary Rice. Well, Senator, I think General Pace has 
spoken to this. I don't want to, in this forum, try and 
prejudge everything that might happen all the way into the 
future. The policy of this administration is to, as quickly as 
possible, turn over responsibility for security to the Iraqis. 
And, as the President said, we will be very pleased the day 
when American forces can come home.
    Senator Kerry. So, the conclusion from what you've just 
said is that the civilian leadership, which is how we lead the 
military in the United States, has a different position from 
the uniformed leadership, which is, you're reserving the right 
to make that decision in the future.
    Secretary Rice. Senator, I said I am not going to try to 
speak to something that is that far into the future.
    Senator Kerry. I heard what you said. I understand.
    Secretary Rice. We are----
    Senator Kerry. No, I----
    Secretary Rice [continuing]. For instance----
    Senator Kerry [continuing]. Understand.
    Secretary Rice. Yes, sorry.
    Senator Kerry. I got your answer.
    Finally, last area, because I know the light's going on 
here. When I was in Iraq a few weeks ago, I had a good 
meeting--I thought it was a good meeting--with Abdul Aziz al 
Hakim. And he made it pretty clear to me in that meeting that 
the SCIRI party had no intention of changing the constitution, 
that they might accept some so-called technical ministerial 
people in a couple of the key Ministries--Interior, Defense, 
Finance. But nobody, not even the Ambassador, who is very 
skilled and who we all have great respect for, was able to 
identify who those people might be. Now, given al-Jaafari's 
ratification as the new Prime Minister again, in a very, very 
divided vote, and one that sends shivers through the Sunni, can 
you tell us what is happening with respect to the efforts to 
leverage a real political reconciliation that, in fact, 
delivers to the Sunnis sufficient guarantees that will 
undermine support for the insurgency? Because every military 
leader has made it clear that this insurgency does not get 
resolved at the barrel of a gun; it will be resolved only 
through the political settlement. And the prospects of that 
settlement, given what has happened already in this choice, and 
the problems with Mr. Allawi's party and their being left out, 
et cetera, leaves major, major questions on the table. Could 
you walk us through that a bit, please?
    Secretary Rice. Well, Senator, I wouldn't draw any 
conclusions just yet as to the work that still remains for Mr. 
Jaafari and others in bringing others onboard so that, in fact, 
they can govern. I would remind that the Shi'a alliance does 
not have a majority. It, therefore, has to form a broad 
national unity government, bringing other parties in, even if 
the Shi'a alliance holds together. So, I think they have a ways 
to go yet.
    Senator Kerry. But you'd agree with me that the key to that 
national unity government, which we all understand is key----
    Secretary Rice. Oh, of course.
    Senator Kerry [continuing]. And we accept that----
    Secretary Rice. It's absolutely key----
    Senator Kerry [continuing]. Is to get those ministries 
filled with the proper people and to change the constitution.
    Secretary Rice. It is, and it's also very important that 
the Sunnis have wanted some changes to the constitution. That 
is certainly something that will need to happen. But I would 
let the Iraqi political process play out for a while here. 
There is a lot of politics still to be done to bring together a 
coalition. We keep talking as if Mr. Jaafari is the only issue 
here. He's not.
    Senator Kerry. No, I understand that.
    Secretary Rice. He cannot govern without bringing others 
onboard. And so, I'm quite sure that there will be many demands 
from others as to what happens now, going forward. That, 
indeed, is the nature of politics.
    Senator Kerry. But the fundamental division of federalism, 
which is a SCIRI party goal, major goal, with major political 
ambitions attached to it, versus a national, ``unity,'' is a 
real--that's a big tension.
    Secretary Rice. Of course it's a tension, Senator. There 
are tensions in any political system. You know, our own 
political life began by being, unfortunately, unable, for a 
number of years, to resolve the issue of slavery. We, 
nonetheless, managed to create ourselves as a union. I don't 
think the Iraqis have anything quite that bad yet on their 
plate. And so, I would say let's let this maturing political 
system now deal with the various tensions within it concerning 
what will happen about federalism, what will happen to changes 
in the constitution. These are precisely the discussions that 
are going to have to go on for Mr. Jaafari or whoever becomes 
Prime Minister to form a national unity government. Yes; we do 
know some of the people that are being considered for key 
posts. I think, obviously, we want to reserve those discussions 
for the Iraqis rather than publicly talking about their own 
process of government formation. But we're very involved in 
helping them to work through this extremely difficult period.
    But this is the core of their politics right now. So far, 
they have demonstrated a capacity to get through every single 
phase together rather than split apart. They did get through 
the writing of a constitution together rather than splitting 
apart. And I think they will continue to, because that's what 
the political context is.
    Senator, if I may just very briefly, though, on the 
elections, because I agree with you, elections don't mean 
democracy. I've never yet, however, seen a democracy begin 
without an election. And so, we shouldn't underestimate the 
importance of elections. What it means is that in our policies 
we have to work harder to help develop civil society and 
moderate political forces into political parties. That can't 
happen in an authoritarian environment. The notion that you can 
somehow have the practices of democracy underneath an 
authoritarian regime so that then when you have an election you 
have all of these well-developed parties that can compete, I 
think, is just not logical. So, yes; I think you have to take, 
if you will, the opportunity for an election to stimulate the 
political system, then to begin the process of building a full-
fledged democracy.
    As I said, elections don't mean democracy, but I've never 
seen one begin without an election.
    Senator Kerry. Well, Mr. Chairman, I appreciate the 
comment. Actually, the American democracy began with a 
revolution, not an election. And----
    Secretary Rice. Yes, they held an election.
    Senator Kerry [continuing]. The fact is----
    Secretary Rice. Fairly soon afterward, I believe----
    Senator Kerry [continuing]. I understand. But it began----
    Secretary Rice [continuing]. Senator, and that's when 
democracy really began.
    Senator Kerry [continuing]. With a revolution. Ultimately, 
we had a civil war to resolve the issue of slavery, and there 
are many people who argue that Iraq is already in a low-
intensity civil war. And if you don't resolve the differences 
in this constitution, it will get worse.
    So, my point, Mr. Chairman, is simply that there are a lot 
of players over there, and a lot of others, who do not see the 
pieces of the political pie--can we get there? I believe we 
can. I think Senator Biden--there's a lot of us who have felt--
and we've sort of stuck with this concept that success is 
critical. There's a way to get there.
    Senator Biden. I think we're getting beyond it.
    Senator Kerry. But there are a lot of people who feel that 
opportunity after opportunity to realistically deal with that 
is just being obliterated and ignored.
    Secretary Rice. Senator, I would just urge a little 
patience with the Iraqis. That was my point about the American 
democracy, is it took us a while to work some of these issues 
out. I don't think the Iraqis are headed toward a civil war.
    Senator Kerry. You say a little patience. The American 
people have already sustained a war that has gone on longer 
than World War II, longer than it took us to beat the axis 
powers, and have invested in ultimately what will be up to $300 
billion, and some say $\1/2\ trillion before we finish. That's 
pretty patient.
    Secretary Rice. The Iraqis have been at the process of 
government formation for 1 year. That is really not very long--
--
    Senator Kerry. The only point----
    Secretary Rice [continuing]. In history.
    Senator Kerry [continuing]. I'm making, Madam Secretary----
    Secretary Rice [continuing]. They had to overthrow, 
Senator, a brutal dictator. And, yes; they've had to learn the 
patterns of coming to terms with each other politically rather 
than through violence. And that takes some time.
    Senator Kerry. All I point to are the fundamentals. And if 
the fundamentals remain as divided as they are--and growing 
worse, not better--we have a problem.
    The Chairman. Thank you very much, Senator Kerry.
    Senator Coleman.
    Senator Coleman. Thank you, Mr. Chairman.
    And, maybe, it's the beauty of America that we're so 
strong, we're so rich, and we're so powerful that there's a 
sense if we just did a little more, people would elect folks 
that, you know, we'd like a little more. I would maintain 
that--again, the election of Hamas is a horrible--it's 
outrageous, and we have to deal with that, but that--the 
failure of leadership is Abu Mazen. Failure is failure to deal 
with corruption. And, you know, the democracy is a messy thing. 
And I paraphrase Churchill. It's the worst form of government, 
a messy form of government, but a far cry better than anything 
else. I think there is a fundamental question that's being 
asked here. Do we continue to support leadership that rejects, 
ignores, the will of the people, or do we move forward with the 
democratic process? I would hope we would continue to have the 
courage to move forward with the democratic process, because I 
agree with your sentiments, Madam Secretary, that you can't 
develop a rule of law and civil society in oppressive regimes. 
And so, these are some messy times now, but, goodness gracious, 
I appreciate your--you disabusing us of the notion that somehow 
they were the halcyon days of intifada and Arafat, of Saddam, 
of Khomeini and the Taliban. That just wasn't the case. It's 
tough today, but it was downright brutal and ugly awhile ago.
    If I can just shift gears, focus a little bit on one of my 
favorite subjects: U.N. reform. One of the issues, the areas 
where there appears to be some movement, but an area of 
concern, is the Human Rights Commission. Clearly, the reform 
movement has not taken hold to the degree that we would like, 
but there is some progress. I think Ambassador Bolton is doing 
an outstanding job. My concern is, in particular, regarding the 
Human Rights Commission. We're still at a stage right now where 
we don't have criteria for membership. Some of the things on 
the table would not allow for continuous membership. So, we 
would be off again, and we wouldn't be part of this body. And 
then, from everything that I've seen on the table, we're still 
facing the situation where Israel is the only nation that's 
still out of the process. Even in the Human Rights Council, 
they're still--the absurdity of our democratic ally in the 
Middle East not even being part of the process.
    Do we have some bottom lines, in terms of the Human Rights 
Commission? Are we just going to accept, you know, something 
transformed that keeps us out at some point, that doesn't have 
criteria, and that continues to block out Israel? Or are we 
going to say we're--we want a Human Rights Council, but it's 
got to be the right kind of Human Rights Council?
    Secretary Rice. Thank you, Senator.
    We do not want just any Human Rights Council. We certainly 
want something that is far better than the Human Rights 
Commission, which we are, thankfully, abolishing, a commission 
that once had Sudan as its chair, when Sudan was under the 
sanction for genocide, so--a finding of genocide.
    We are working very closely. I talked to Kofi Annan about 
it when he was down. I think people understand that this needs 
to be a different kind of body. We have, for instance, proposed 
that it should not be possible to serve on the Human Rights 
Council while you're under sanctions for terrorism or for human 
rights abuses. This seems, to us, a rather self-evident matter. 
But it isn't a terribly popular position, it turns out. So, we 
will work with others to try and achieve some standards and 
some criteria that make it possible to say that this Human 
Rights Council actually has some standing to look at issues of 
human rights. No, Senator, we don't want just any Human Rights 
Council.
    Senator Coleman. Well, I appreciate that. And, again, the 
issue with Israel, and the United Nations has made some----
    Secretary Rice. Yes.
    Senator Coleman [continuing]. Reform there. They've 
recognized the Holocaust. They're dealing----
    Secretary Rice. Yes.
    Senator Coleman [continuing]. With the issue of anti-
Semitism in a different way. But to continually exclude, to 
block out, is something that I--I think we have to draw some 
lines and say that's not acceptable.
    Secretary Rice. Absolutely.
    Senator Coleman. Let me, if I can, refocus--we've gone from 
the big picture--really, you know, focused locally. You know, 
when I was a mayor, you say that the most important park was 
not the national park, but the one in your backyard. Western 
Hemisphere Travel Initiative. Real security issues, in terms of 
folks moving--getting in and out of this country. No question 
about that. But for those of us who represent northern border 
States, I've got kids in Minnesota who hop in a van, and they 
go play hockey with kids right across the border, because there 
aren't enough kids in--just in one part or the other. There is 
a--economic ties that are strong. And there are family ties. We 
have moved away, I believe, from purely the passport 
perspective. But I just want to put on the table and have your 
folks go back and reflect, we need something that is, one, 
cost--you know, affordable. In Washington, 60 bucks, 70 bucks 
may be the price of a lunch. That's a lot if you've got five 
kids and you're in Warroad, you're in International Falls, 
you're in Roseau, Minnesota. And so, you know, 15-20 bucks may 
not be a lot, but $60-$70 is a lot for American families who 
have got kids shooting across the border to play hockey on a 
regular basis.
    Portability, it's--you know, I mean, can't we, you know, 
talk to MasterCard or Visa, and you get a little card you can 
stick in your pocket, so if you're fishing in--you know, on--in 
Rainy River, and you--something falls in the lake or something, 
you can put it back in your pocket and replace it, cheap? And 
the issue--other thing is, you've perhaps noticed that there 
are businesses and others--right now, we're suffering. They 
happen to be--people believe that you can't go to Canada now 
without a passport. My son asked me that the other day. As it 
is, we're not looking to 2008, but there are businesses that 
are being impacted now.
    So, you know, perhaps do a pilot project, perhaps do 
something that we can test whether it works. But this is one of 
those little things, Madam Secretary, that's a big thing. And I 
would hope we'd continue to retool this, because I've got folks 
who are concerned about their economic livelihood. As it is, 
there isn't a lot of industry up there. Tourism is a big part 
of it. And if they're impacted--if we put in place something 
that prevents families from easy access moving across--
dissuades folks from wanting to go up there, it's going to have 
a terrible--it's going to have a negative impact in a place 
that really can't afford that kind of impact.
    Secretary Rice. Thank you, Senator.
    We will continue to look at the Western Hemisphere Travel 
Initiative. Probably the first person who didn't like the idea 
of passports was the former Governor of Texas, who came to us 
and said, ``You can't do this. You don't know how traffic moves 
on the Texas-Mexico border''--and, of course, for Canada and 
the northern States. And so, Mike Chertoff and I have been 
working on this. We have come up with the idea of this single 
card. We will obviously try to make it as affordable as 
possible, as easy as possible, while recognizing that there's a 
good security reason for having some form of identification 
that is standard.
    Senator Coleman. Appreciate it. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Coleman.
    Senator Nelson.
    Senator Nelson. Thank you, Mr. Chairman.
    Madam Secretary, good morning. Since this is a hearing on 
the President's budget on foreign affairs, I want to ask you 
some specific questions about the budget and the policy reasons 
behind the President's priorities.
    We have serious challenges all over Latin America, the 
Caribbean, and Central America. It seems to me that the policy 
driving the proposed cuts in the President's budget for 
assistance to various nations is a wrongheaded policy. So I 
would like to give you a forum to explain, for example, the 
reason for the cuts in the assistance program to El Salvador 
from $22 million to $7 million.
    Secretary Rice. Yes. Well, Senator, I was with the Foreign 
Ministers, last night, of El Salvador, Colombia, Mexico, and 
Panama. And we talked about the region and ways to strengthen 
American and democratic influences in the region.
    El Salvador is obviously a very important partner. We are 
about to work with El Salvador--and it's going very well--for a 
Millennium Challenge Account compact, which will be a 
substantial increase, then, in foreign assistance to El 
Salvador. And, as is the case with Nicaragua and Honduras, some 
of the cuts in other kinds of assistance are where there was 
some overlap in that kind of assistance that now we expect the 
Millennium Challenge compacts to be addressing, but also 
something of a shift in the way that we are going to, 
therefore, deliver foreign assistance to some countries that we 
think are at a stage where they are governed wisely, where they 
have largely rooted out corruption, and where we're, therefore, 
able to work with them in a different way through the 
Millennium Challenge Program. It's not that we have cut, 
overall. As we've put Millennium Challenge money in, we haven't 
cut development assistance as a routine matter, because we 
continue to do development assistance, and we continue to do 
economic support fund assistance for these countries.
    Senator Nelson. Let me----
    Secretary Rice. We will have a very large--a large compact 
with El Salvador.
    Senator Nelson. Well, let's correct, for the record, just 
on your statement there. You say you haven't cut it, overall, 
but the President's request for development assistance overall 
in Latin America is cut by 28\1/2\ percent.
    Secretary Rice. Senator, I said worldwide, as a routine 
matter, we have not, as we've gone in with Millennium 
Challenge, then decided, all right, we've got a Millennium 
Challenge, we're going to cut development assistance. It wasn't 
in specific to Latin America.
    Senator Nelson. Well, the nature of my questions are with 
regard to Latin America. We've covered other areas. And I don't 
think things are going too well for us in Latin America. I'm 
concerned that the Latin American people are not holding us in 
high esteem. So I wonder why we suddenly have a policy of 
cutting development assistance to Latin America. Now, you've 
explained three countries--Nicaragua, Honduras, and El 
Salvador. You said that even though those cuts occur--and 
they're Draconian cuts--you say that's going to be made up with 
the Millennium Challenge, if that is awarded. And they haven't 
been announced----
    Secretary Rice. Well, they have----
    Senator Nelson [continuing]. To those countries.
    Secretary Rice [continuing]. They have been, for Nicaragua 
and Honduras. Those compacts are in place and announced.
    Senator Nelson. Not in El Salvador.
    Secretary Rice. El Salvador. El Salvador is still being 
negotiated. That's right.
    Senator Nelson. So, you seem to make it up there, but what 
about the rest of Latin America which gets a huge cut of 28\1/
2\ percent?
    Secretary Rice. Senator, there are some cuts in development 
assistance to some countries in Latin America. I can get you an 
answer that goes country by country, because there are 
different explanations in many of these cases.
    [The submitted written answer to the information requested 
follows:]

    Foreign assistance for the region has nearly doubled since the 
start of the administration, rising from $862,452,000 in FY 2001 to 
$1,696,841,000 in FY 2007. Although the current request for Latin 
America represents an overall decrease of 1 percent from the FY 2006 
request, this does not reflect a reduced commitment to Latin America. 
We have prioritized our foreign policy goals against available 
resources and competing demands for assistance. For example, reductions 
for middle-income countries where the need is not as great allows us to 
increase assistance in areas such as Africa, where the need is greater. 
Moreover, in addition to our FY 2007 request, we will be providing 
Millennium Challenge Corporation (MCC) funding to Nicaragua, Honduras, 
and Paraguay, increasing our overall assistance to the region.
    Since the MCC was established in 2004, it has approved compacts for 
Nicaragua ($175 million) and Honduras ($215 million). Bolivia submitted 
a proposal in December 2005, and discussions are pending Bolivia naming 
a senior negotiator. We expect El Salvador to submit its proposal later 
this fiscal year for a significant amount of assistance. On February 8, 
MCC's Board approved a $37 million program for Paraguay as a Threshold 
Country, one that has shown political commitment to good governance but 
has not yet achieved the policy reforms that could make it eligible for 
a compact. Guyana has also been selected as a Threshold Country, but 
does not yet have an approved program. MCC funding has increased the 
total resources available to the region.
    We believe our overall funding is at a level that will help us 
achieve our foreign policy goals in Latin America--even as we 
incorporate transformational diplomacy strategies across the board that 
will result in more effective foreign assistance. We have, in fact, 
requested additional resources to better focus on those activities that 
will stimulate growth and be truly transformational. To stimulate 
growth in the CAFTA-DR states, in addition to the $20 million in 
Economic Supports Funds (ESF) and $20 million in Development Assistance 
(DA) that has been requested for labor and environment, we have 
requested $30 million for rural development in the Dominican Republic, 
El Salvador, and Guatemala ($10 million each).
    Our funding request reflects our commitment to focus assistance on 
trade and capacity building as we believe our greatest benefit can be 
drawn from trade and economic growth. U.S.-accumulated direct 
investment in the region is $325 billion, and two-way trade between the 
United States and the region was $443 billion for the first 11 months 
of 2005. We have free trade agreements (FTAs) in place with Canada, 
Mexico, and Chile. The CAFTA-DR agreement has now entered into force 
with El Salvador as of March 1, to be followed as soon as possible with 
Nicaragua, Honduras, Guatemala, and the Dominican Republic, and 
eventually Costa Rica. FTA negotiations were concluded with Peru on 
December 7, 2005, with Colombia on February 27, 2006, and are ongoing 
with Panama and Ecuador.
    During the budget hearing, you asked Secretary Rice, specifically, 
about our funding for Haiti. Since 2004, we pledged over $400 million 
in assistance to help the Haitian people and transform Haiti into a 
more stable, prosperous, and democratic nation, This does not include 
our contribution of $261.5 million to the U.N. mission (MINUSTAH) over 
this same period. We coordinate closely with donor partners to ensure 
all priorities are funded and to avoid redundancies. Other donors 
pledged a total of $970 million over the FY 2005-FY 2006 period. The 
multidonor Interim Cooperation Framework launched in July 2004 at the 
Haiti Donors' Conference at the World Bank will be extended until the 
end of 2007 to ensure continued support to the next government. We look 
forward to the next high-level donors' pledging conference slated for 
later this year to reinforce this close coordination among donors and 
confirm the international community's long-term commitment toward 
Haiti. As Secretary Rice stated during her testimony, we will take a 
look at what level of support we will need to give, and what support we 
will need to get others to give to Haiti.
    USAID's current multiyear Haiti strategy concludes at the end of FY 
2006 and a new country strategy begins in FY 2007. Our assistance 
program to Haiti funds jobs, environment and natural resource 
management, vocational training, food assistance and medical care, as 
well as technical advice and budget support to the government. We 
provide healthcare services to over a third of the Haitian population, 
and over 2.2 million vaccination doses for children. We are fighting 
AIDS by reinforcing prevention efforts, expanding testing, and 
providing antiretroviral treatment throughout the country. In addition, 
we support civil society organizations and the media, and provide 
credit to small and microentrepreneurs. With the inauguration of the 
new government, we and our international partners will look for 
additional opportunities to introduce new programs to strengthen the 
Parliament and improve capacity at the local level.
    As you are aware, 2006 is the year of elections across Latin 
America. We are looking at all of the new governments that may have new 
requirements and we very much want to make sure that we fund them 
adequately. Enclosed are the individual country and regional program 
descriptions from the Congressional Budget Justification (CBJ) that 
explain our request in greater detail.

    [Editor's note.--The submitted information mentioned above from the 
Congressional Budget Justification was too voluminous to include in the 
printed hearing. It will be retained in the permanent record of the 
committee.]

    Secretary Rice. It is also the case that we have had to 
refocus some of the assistance on places where we think there 
is greater relative need.
    Senator Nelson. Elsewhere in the world.
    Secretary Rice. Elsewhere in the world.
    Senator Nelson. Outside of----
    Secretary Rice. Outside----
    Senator Nelson. All right. Well, then let me bring you to a 
place that we have an enormous amount of strife right now: 
Haiti. Haiti needs a long-term commitment from the United 
States, as well as the rest of the world, to have a chance to 
improve its situation. And here we are, hanging by our 
fingernails every day now on a disputed election and so forth, 
and yet the administration, for example, in development 
assistance, has included a cut to Haiti in its proposal to the 
Congress--we're going to make the decisions, but I'm trying to 
find out from you the policy reasons why, in the poorest nation 
in the Western Hemisphere, we would cut development assistance 
from $29.7 million to $23.1 million, and child health and 
survival, which includes vaccinations, that we would cut from 
$19.8 million to $15.8 million.
    Secretary Rice. Senator, if you take our overall funding 
for Haiti, it is level, if you look at economic support funding 
and the like. But let me just note that we made a commitment to 
Haiti, in the donors conference, for 400 million dollars' worth 
of assistance. That was our commitment to Haiti. That has been 
apportioned as follows: 2004, $101 million; 2005, $209 million; 
and 2006, $194 million. So, we have met those requirements.
    We will continue to look at what will need to be done in 
Haiti now that there will be a new government. We have to 
remember that we've also been supporting the efforts of others 
in peacekeeping, in election assistance, and the like. So, I 
think the development assistance piece doesn't show the entire 
picture for what we're doing for Haiti.
    But I would be the first to agree that we're going to have 
to take a look, as we look forward to next year's budget, for 
now, with hopefully a stable government in Haiti, not a 
transitional government, on what support we will need to give 
and what support we will need to get others to give to Haiti. 
And I think that's a fair question. We will have to look at 
that level of support.
    Senator Nelson. Well, this Senator is going to try to 
increase that budget. Am I going to get some resistance from 
you?
    Secretary Rice. Senator, I never like to turn down money, 
particularly in a good cause. I would just say that I think we 
believe we've adequately funded our needs in Haiti, but we are 
well aware that, in a couple of cases around the world--Haiti 
is one, Liberia is another--we're looking at new governments 
that may have new requirements, and we very much want to make 
sure that we adequately fund them.
    The Chairman. Thank you very much, Senator Nelson.
    Let the Chair just mention that we've tried desperately, 
from the beginning, to make sure every Senator can be heard 
today. We have four Senators still to be heard. We have about 
24 minutes. The Secretary will need to leave at 11:45. And so, 
the Chair will ask each Senator to cooperate in trying to 
maintain something close to the 5 minutes.
    Senator Allen.
    Senator Allen. Thank you, Mr. Chairman. Good morning, Dr. 
Rice, and welcome.
    For Senator Coleman, I was up at the Super Bowl and met 
with some of our Homeland Security people there, shippers and 
trucks that go over the bridges and tunnel, and the ferry that 
goes across there from Windsor to Detroit. They've done a great 
job using technology and making sure commerce is actually 
moving more quickly than before 9/11. So, maybe that would be a 
model, where Homeland Security can work in Minnesota.
    Two areas I want to discuss with you; Hamas and the Iran 
Sanctions Act.
    On Hamas, Secretary Rice, what is the administration's 
efforts going to be to make sure that no U.S. funding finds its 
way to Hamas? How do you plan to deal with the kinds of 
assistance that are sometimes characterized as humanitarian? In 
your answer, if you could, sometimes we fund various 
international agencies, it might be the United Nations or 
others, that funding somehow could get into the hands of Hamas. 
If you could share the administration plan with me, because I 
don't want a penny of American taxpayers' money going to fund 
Hamas.
    Secretary Rice. No, I understand, Senator, and neither do 
I. We are reviewing all of our programs, and reviewing them 
piece by piece, so that we know exactly how moneys would move, 
and the like.
    I've already let the Palestinians know that I have to 
secure moneys that were put forward for Gaza withdrawal 
reconstruction, because, frankly, that is money that would be 
available to the Government of the Palestinians. And if that 
government is Hamas, then that government cannot have that 
money. So, we're making some efforts, already, to secure 
funding that may have been already granted.
    On the matter of the rest of the funding, we do want to be 
responsive to humanitarian concerns. You know, we want to be 
able to continue to support immunization of Palestinian 
children. We want to be able to continue to support the 
refugees, something that we have been doing for a very, very 
long time. We do it through nongovernmental organizations and 
through U.N. agencies. But we will look very hard at what the 
path, if you will, would be for the use of those moneys.
    I do think we want to continue to be responsive on 
humanitarian needs. I think it would not be in our character to 
refuse to immunize Palestinian children because Hamas is in the 
government. But that portion of the funding that would go to 
support the government, whether it is reconstruction projects 
or budget support or anything of the like, we've been very 
clear that, unless the Palestinian Government, whatever its 
composition, is prepared to recognize Israel and to carry out 
the other requirements of the Quartet, that no money will go to 
that government.
    Senator Allen. Insofar as the refugees, what funding are 
you referring to?
    Secretary Rice. Well, there are refugee camps in the 
Palestinian territories, in Gaza.
    Senator Allen. Right.
    Secretary Rice. And we have--through the U.N. refugee fund, 
we have given some funding, over many years, to support those 
refugee camps, much as we support refugee camps in Darfur or 
other places. And I think we will want to look at how that 
works. But I want to reserve that we really have to look hard 
at the humanitarian needs versus government support. And 
government support, we absolutely will not do.
    Senator Allen. Good.
    Now, insofar as the Iran--actually, it's my understanding 
the Iran-Libya Sanctions Act will be expiring sometime this 
summer. I believe it's in August. I presume that it'll be 
reauthorized. Are there any specific suggestions that the 
administration will have to that act? Changes, additions, 
deletions? If you could share those with us, please.
    Secretary Rice. Thank you. Thank you, Senator. I think we 
want to do a careful look at where we are in a couple of 
months, in terms of where we are with our allies. We are in a 
different phase now. The Iran-Libya Sanctions Act, I think, has 
been very useful to us as a tool, but we're in a different 
phase now. And so, I appreciate your suggestion, and I'll take 
it as an invitation to review with concerned Members of 
Congress how we might think about the reauthorization under new 
circumstances. I'm not really prepared to give you answers now, 
specifically, but we will do that work.
    Senator Allen. Thank you, Dr. Rice.
    I'll yield back the matter of seconds I have not consumed. 
[Laughter.]
    Thank you, Dr. Rice. Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Allen.
    Let me just mention that Senator Obama and Senator Martinez 
have been with us well over an hour, and I'm going to recognize 
them in that order, and then we'll proceed back into the 
regular order.
    Senator Obama.
    Senator Obama. Thank you very much, Mr. Chairman.
    Secretary Rice, let me--I want to touch on three things. 
And, since my time is limited, I want to make sure everybody 
gets a chance. You know, if we can keep our answers, and my 
questions, relatively brief, that would be terrific.
    First, on Iraq. Let's stipulate that elections and 
democracy are superior to authoritarianism and torture. So, 
we'll--that, I think, is a given. I think the concern that 
you've heard, from some of the panelists at least, is that, 
although we recognize the need for patience in Iraq, that 
democracy takes some time, that the back and forth between the 
various factions is not untypical of a fledgling democracy, 
there is a difference between what's going on in Iraq and what 
happened in the United States during our early formative years, 
and that was, there wasn't a third country--or there wasn't an 
outside power that was financing this entire experiment, our 
experiment. And, you know, we have spent, as has been 
mentioned, $300 billion. You know, the estimates may be higher. 
We've lost a substantial number of young men and women, who 
have served us bravely. And so, I think the bottom line, I 
guess, is, At what point do we say that we are going to start 
ratcheting down our involvement as the Iraqis figure out what 
it is that they want to do?
    So, I think a lot of the questions are prompted not by some 
unrealistic notion of how quickly Iraqis should get their act 
together, but, rather, the fact that we're on the hook for 
blood and treasure. And this administration has suggested 
that--has been open-ended, in terms of its commitments. And so, 
let me be very specific on the question. You know, there has 
been discussion about a phased withdrawal. And the question is 
whether we can anticipate, given the direction that 
negotiations between the various factions in Iraq have been 
proceeding, whether or not such a phased withdrawal is 
advisable, would help send a signal to the Shi'as that we're 
not going to be here forever, and that they need to negotiate 
with the Sunnis, and would start signaling to the Iraqi 
population that, in fact, we are not interested in permanent 
bases and long-term occupation there?
    Secretary Rice. Well, on the latter point, first of all, 
the United States is not seeking permanent bases around the 
world very much anymore. And, in fact, we're moving permanent 
bases out of most of the world back to the United States. So, I 
think----
    Senator Obama. I understand. But the----
    Secretary Rice [continuing]. But----
    Senator Obama [continuing]. This is a specific perception 
on the----
    Secretary Rice. No.
    Senator Obama [continuing]. Part, and----
    Secretary Rice. No; I understand, Senator. I certainly do. 
My perception of this, or my way of thinking about this, is 
that rather than talking about phased withdrawal, we need to 
talk about what needs to be accomplished for the conditions to 
be proper for the United States to begin to diminish its 
presence. We have gone from 17 to 15 brigades just----
    Senator Obama. Well, then----
    Secretary Rice [continuing]. Just recently.
    Senator Obama. I'm less interested in terminology. And I 
don't mean to interrupt you, but I've got a couple of other 
questions. So, the--I guess what I'm saying is, Are conditions 
being met that would then allow for a phased withdrawal?
    Secretary Rice. I don't want to use the term ``phased 
withdrawal,'' but I think the conditions are being met that 
will lead to more and more transfer to the Iraqi forces 
themselves of responsibility for their security, for the 
control of their territory----
    Senator Obama. So, you are optimistic that the direction--
--
    Secretary Rice. I am----
    Senator Obama [continuing]. That the direction----
    Secretary Rice [continuing]. I am----
    Senator Obama [continuing]. That the democracy----
    Secretary Rice [continuing]. Optimistic----
    Senator Obama [continuing]. Is leading----
    Secretary Rice [continuing]. The direction; yes.
    Senator Obama [continuing]. Will allow us to start bringing 
troops home.
    Secretary Rice. I am optimistic that the United States is 
seeing Iraqis step up, take responsibility for security, take 
responsibility for controlling their territory, that the 
government-formation process is moving----
    Senator Obama. Madam Secretary, you're----
    Secretary Rice [continuing]. Ahead.
    Senator Obama. Very good----
    Secretary Rice. Yes. And----
    Senator Obama [continuing]. But what I'm asking----
    Secretary Rice. Senator----
    Senator Obama [continuing]. You is----
    Secretary Rice. Senator, I----
    Senator Obama. You're not going to answer the question, is 
what you're saying.
    Secretary Rice. No. What I'm saying is, I do believe that 
this is going in the right direction. And, as the President 
said, when it's going in the right direction, we have no desire 
to be there any longer in any larger numbers than we need to 
be.
    Senator Obama. OK. Well, the--we're a little stuck here. 
And you--you parried that well. I have to say that the question 
that the American people want to know is, At what point can we 
end the large-scale commitments that are costing us billions of 
dollars and have, so far, cost us thousands of lives? And so, 
that's really the bottom line. And if--people are impatient not 
about Iraq, they're impatient about our commitments, which are 
putting us in the red.
    Iran. There has been some significant progress in getting 
China and Russia and others onboard to send a strong signal to 
Iran that, in fact, the pursuit of nuclear weapons is not 
acceptable. My specific questions are, Have we reached the 
point where there is agreement among Russians, Chinese, 
Indians, others, in the form that sanctions or penalties or 
signals to the Iranians--what those would look like? You don't 
have--and then you may not want to articulate all of them. I'm 
sure that there's a menu of choices. I guess what I'm saying 
is, Do we have--is your sense that those folks are moving along 
with us, or are they just saying a lot of pretty words, but 
aren't as committed as we are on this issue?
    Secretary Rice. Well, earlier I had mentioned that I think 
it's not going to be easy to come to agreement about what the 
course ought to be, in terms of sanctions. But I do believe 
that we're having those discussions. The more Iran does the 
kinds of things that it did today, in starting enrichment and 
reprocessing, and, therefore, defying the international 
community, the more I think you will see people come together 
around a set of consequences for Iran's behavior.
    We are in very intense discussions with our colleagues 
about what that menu might look like, about how that menu might 
play out over time. I don't want to get ahead of the 
diplomacy----
    Senator Obama. I understand.
    Secretary Rice [continuing]. But we are in those 
discussions.
    The Chairman. Senator Obama, I----
    Senator Obama. Am I out of time? Can I just ask one last 
question? And they're--on this Iran topic?--and that is, the 
Russians have proposed a very specific plan to provide some 
face-saving to the Iranians, should they back down.
    Secretary Rice. Yes.
    Senator Obama. Is it the administration's position that 
that is a viable framework, provided that there was strong 
verification and that, in fact, the Iranians were behaving?
    Secretary Rice. We do support the Russian plan, because we 
believe it achieves the essential thing, which is not to allow 
enrichment and reprocessing to take place on Iranian soil. We 
also would note that the President, all the way back in his 
speech at the National Defense University, talked about fuel 
assurances for countries that might want to build a civil 
nuclear power, but should not have the full fuel cycle. And so, 
the Russian proposal is consistent with those, although there 
are certain elements that I think we would have to continue to 
work through with them. We are supportive of the Russian 
efforts.
    Senator Obama. Thank you.
    The Chairman. Thank you very much, Senator Obama.
    Senator Martinez.
    Senator Martinez. Thank you, Mr. Chairman, very much for 
your courtesy.
    And thank you, Madam Secretary. It's good to see you.
    I think that it's important that, you know, we point out 
the fact that elections do require more than--I'm sorry, 
democracies do require more than election day. And one of the 
troubling signals we've seen in recent--the year or two--is the 
elections of Mr. Chavez in Venezuela not followed by 
democratic-like behavior, becoming more and more of a 
totalitarian. So, I hope when we look at elections as being 
only determinative of what happened on one given day, we do it 
across the board, and not just selectively.
    I also want to commend the President for reaching out to 
Evo Morales, a person who has not had publicly kind things to 
say about the President--in fact, quite unusual for heads of 
state to comment in that fashion--but that he did, in fact, 
place a phone call to him, and--that I thought was a terrific 
moment of reaching out.
    And I guess what I would point out is that bad behavior 
around the world does not always depend upon the actions of the 
United States, but that people sometimes behave badly on their 
very own, with or without the assistance of what we may or may 
not do.
    And speaking of bad behavior, Iran and its troubling 
tendencies appear to also be headed in our region. You know, 
Florida's backyard is our Western Hemisphere, so I concern 
myself greatly with what happens there. And in recent days, 
we've seen increasing diplomatic interaction between Iran and 
Cuba and Venezuela, two countries that voted not to send Iran 
to the Security Council because of their very dangerous 
behavior in nuclear weapons.
    I want you to--I'm going to follow the chairman's example--
I want you to comment on that, if you would, in addition to 
also further comment on the fact that the MCA was, in my 
understanding, not intended to take the place of other 
assistance. So, again, on the issue of cuts to the region of 
Latin America, I'm greatly concerned, and share the concern of 
Senator Nelson there.
    And, third, if you could comment also on the migration 
accords with Cuba. Recently, we've seen some very troubling 
situations there. One is this incident with the bridge and the 
wet-foot/dry-foot thing, which, frankly, no one can quite 
understand how we got to that. And, second, yesterday, in the 
Wall Street Journal, it was pointed out the story of the--a 
very compelling story of these two--a couple, husband and wife, 
who were trying to be reunited with their family here in the 
United States, escape Cuba, because Cuba would not let them 
leave legally, even though the United States had granted them a 
visa, and now find themselves in very deplorable conditions 
being detained in the Bahamas. Whether you're aware of the 
situation and what we might be doing to encourage the Bahamas 
to behave neighborly and release these folks so they might join 
their families here.
    Secretary Rice. Thank you. Senator, I was not aware, until 
I saw the Journal piece, and I will--we will get back to you 
with an answer.

    [Editor's note.--The committee understands that the Office 
of the Secretary of State provided the requested information 
orally to Senator Martinez.]

    Senator Martinez. Ambassador Rood has been great on this--
--
    Secretary Rice. Yes.
    Senator Martinez [continuing]. To the point of visiting 
them, and so forth.
    Secretary Rice. Yes.
    Senator Martinez. And we've been back and forth with 
letters. But more action, I think, is required.
    Secretary Rice. Yes. I understand.
    Senator Martinez. Thank you.
    Secretary Rice. On Cuba, generally, as you know, we have 
tried to have a humane migration policy, but one that does not 
somehow encourage Fidel Castro to play games with our--with 
migration policy, which he is wont to do, as you well know, 
from Florida. And so, we have maintained a policy that I think 
balances those two elements. But when we have a case of the 
kind that you are talking about, we try to remember that, of 
course, Cuba is a terrible dictatorship, and that people are 
fleeing for reasons of political oppression, not just economic 
matters. And so, that's why the policy on Cuba has been 
different than the policy on some other places.
    In terms of Iran, yes; it was interesting that those who 
voted with Iran were Syria, Cuba, and Venezuela. And we have--
we believe that it is very important that those in this 
hemisphere recognize that whatever they may think this is, in 
terms of sticking a thumb in the eye of the United States, it's 
really a thumb in the eye of the international community, 
because that vote in the IAEA was a solid one that included 
Egypt and China and all kinds of countries in the consensus. 
And so, I think that's a message that needs to be sent.
    And, finally, on the issue of elections, I agree that 
election day is just election day. The follow-on that we've 
been emphasizing in our region is that it's not an issue for us 
of whether you're elected from right or left, it's an issue of 
whether, after elected, you, in fact, govern democratically. 
And that is the challenge, I think, in our hemisphere, is to 
make sure that people who are elected, govern democratically.
    But I just want to say, again, as you would agree, Senator, 
let's also not undervalue the fact that free and fair elections 
do matter, because you cannot have a democracy unless there are 
free and fair elections. It is not a sufficient condition, but 
it certainly is a necessary one. But then we have to make sure 
that we send the message that people govern democratically.
    Senator Martinez. Thank you.
    The Chairman. Thank you very much, Senator Murkowski.
    Senator Sarbanes.
    Senator Sarbanes. Thank you very much, Mr. Chairman.
    Madam Secretary, I join my colleagues in welcoming you here 
this morning. I regret that we weren't able to have the hearing 
yesterday, because I think you had set aside a considerable 
amount of time for yesterday's hearings. But apparently a 
political event Monday night led to the cancellation of 
yesterday's hearings, and I regret that that took place.
    Actually, I want to ask some questions about the 
President's budget for foreign affairs, which I understood to 
be the topic of the hearing.
    I've always been concerned about us lagging behind in the 
payment of various assessed obligations we've undertaken. Other 
countries are meeting them, but we fall behind. For instance, 
in the Multilateral Development Banks, we're now behind in our 
contributions to the Inter-American Investment Corporation and 
the Multilateral Investment Fund. And the administration isn't 
seeking, in this budget, to take care of those arrearages. At 
the Global Environment Facility, I gather there are no other 
countries, other than the United States, in arrears there. Why 
aren't we addressing that problem?
    Secretary Rice. Well, we do have budgetary constraints that 
sometimes we have to live with some arrearages. We have tried 
to make those minimal, and we've tried to live up to our 
obligations to make certain that the organizations do not 
experience, in a sense, a cash-flow problem because the United 
States is not paying. And I think we are living up to that 
obligation.
    Senator Sarbanes. I have a suggestion for you, in the face 
of your budget constraints. The Millennium Challenge 
Corporation is building up huge balances. In fact, it's 
estimated that, with the request you've just made, which is for 
another $3 billion--even if you assume their most optimistic 
projections about paying money out and signing these compacts--
there will be over $3\1/2\ billion in unobligated funds.
    Secretary Rice. Senator, we just had the Millennium 
Challenge Account board meeting. And, in fact, the numbers 
suggest that, with the increased capacity that John Danilovich 
has brought on, and with an active program, that they will seek 
to approve 11 new compacts worth over $4 billion in fiscal year 
2007. They've already signed five compacts, over $900 million, 
to date. And they have another seven pending, which would be $2 
billion. So, they would have, by the end of fiscal year 2007, 
absorbed all appropriated requested funding. In fact, they, in 
the board meeting, were concerned that we might now be getting 
into a position in which we would have to be--start to draw 
back on our negotiation of contracts, because we might not have 
the funding there.
    Senator Sarbanes. They've been telling us----
    Secretary Rice. You will find that----
    Senator Sarbanes [continuing]. They've been telling us that 
for a long time. We were told last spring that all of the $2.5 
billion that had been appropriated would be obligated by the 
end of calendar year 2005. The last quarterly report showed 
$435 million cumulative disbursements through 2005. Even if you 
take into account the compacts they've signed, totaling another 
$900 million, they are still falling well short of coming 
anywhere near what they had projected.
    Secretary Rice. Senator, I think it took some time to get 
this corporation up and running, and it took some time to get 
the right processes in place. But they have fundamentally, and 
very aggressively, accelerated this process now, and they 
anticipate that, at the end of FY 2007, they will have fully 
spent their appropriated funding.
    Senator Sarbanes. Well, it's on the radar screen. We're 
going to watch that very closely.
    I want to ask one question about your peacekeeping. We're 
lagging, falling behind, as well, in meeting our peacekeeping 
obligations.
    Why have you not requested funding for the U.N. force in 
Cyprus? We've consistently funded that over the years, and the 
peacekeeping contribution for Cyprus has been zeroed out in the 
fiscal 2007 request.
    Secretary Rice. Senator, the funding that we requested on 
peacekeeping, we believe, will meet our obligations. I will get 
back to you with a specific answer on Cyprus.
    [The submitted written answer to the information requested 
follows:]

    The United States has been and remains a strong supporter of the 
United Nations role in seeking a comprehensive settlement in Cyprus. 
UNFICYP has been an important part of this effort, and we will continue 
to work closely with the mission to ensure it remains an effective 
force supporting the eventual renunification of Cyprus. The 
Department's FY 2006 appropriation includes $4,678,000 for UNFICYP. As 
you noted, the Department's FY 2007 budget proposal includes no funding 
for the UNFICYP mission. UNFICYP's mandate is expected to be renewed 
again for 6 months in June against current fiscal year funding. Should 
the pace of the political process require further renewals into FY 
2007, we believe we will be able to reallocate funds within the CIPA 
account to continue our support for UNFICYP and its important mission.
    Progress toward a Cyprus settlement will require creative thinking 
and constructive dialogue. The United States is encouraging the United 
Nations and the parties to the dispute to work together to move the 
Cyprus settlement process forward. We welcome all proposals that seek 
to break the current deadlock, and hope that all parties will engage 
and remain flexible and creative. The United States stands ready to 
assist the United Nations and the parties in this effort.

    Secretary Rice. But we believe that this will meet our 
obligations. I will say that because there are new peacekeeping 
duties, we did seek, in the supplemental last year, some help 
and relief for peacekeeping funding. We did receive it, and 
this time, we believe, in our 2007 budget, we have accounted 
for what we need to do the peacekeeping that is immediately 
before us. I think you will see, in the supplemental, that 
there will probably be some requests for peacekeeping in 
Darfur, because that is not a part of the 2007 budget. But this 
funds our peacekeeping obligations as well as we can do, given 
other budget constraints.
    Senator Sarbanes. No; I'm specifically asking about the 
Cyprus money. The budget request assumes that the mission will 
be terminated in fiscal year 2007. And, of course, then you 
zero it out in your chart, as well----
    Secretary Rice. Well, of course, Senator.
    Senator Sarbanes [continuing]. But why--what's the basis 
for----
    Secretary Rice. Senator, we are, of course, working to try 
to get a resolution of the Cyprus situation. Cyprus, of course, 
now is a member of the European Union. There is a lot that is 
happening on the political front in that regard. If it becomes 
necessary to continue that mission, then we'll find the money 
for it and try to reprogram it, or try to meet the obligation. 
But we believe that a lot, politically, is changing with that, 
including Cyprus's incorporation into the European Union.
    Senator Sarbanes. And how does that affect the 
peacekeeping?
    Secretary Rice. Because, Senator, we're working very hard 
now to get back to where we were a year ago, which was, at the 
time of the Annan plan, with which I know there were some 
disagreements, to actually resolve this conflict. Should there 
be need for continued peacekeeping there, we'll meet the 
obligation.
    Senator Sarbanes. Why don't we do it the other way? Provide 
the money, and then, if you don't need it, then you're in a 
better position to take care of some of these other needs, as 
well.
    Secretary Rice. Well, Senator, we have a lot of----
    Senator Sarbanes. I mean, we could----
    Secretary Rice [continuing]. A lot of----
    Senator Sarbanes [continuing]. We could drop----
    Secretary Rice [continuing]. Budget demands.
    Senator Sarbanes. We could put a zero line for a lot of 
things in here, on some kind of favorable assumption about 
what's going to happen.
    Secretary Rice. Well, Senator, we have a lot of budget 
demands, and we're balancing a lot of requirements. But we'll 
meet our obligations if we need to.
    The Chairman. Thank you, Senator Sarbanes.
    Senator Murkowski, the final questioner of our Secretary.
    Senator Murkowski. Thank you.
    And my question, and probably the Secretary's response will 
be less than a minute, recognizing the Secretary's time.
    We're going to get to the point where every time you look 
at me you're going to think of the Arctic and what we need to 
do there. But--your responses have ranged all over the globe--
but no concerns raised thus far, as they relate to the Arctic 
and Arctic policy. And, as you know, that's something that I 
have been encouraging those in the State Department to work 
with us on, and we're going to have a lot more conversation 
about it.
    Specifically, 2007 is the International Polar Year. All 
eyes are going to be on Alaska and the United States and our 
role in that international event. My question to you this 
morning is, What funding, if any, is included in the budget for 
this international event next year?
    Secretary Rice. I will have to get back to you, Senator. I 
don't know the specifics.
    [The submitted written answer to the information requested 
follows:]

    The President requested funding to support this event as a part of 
the National Science Foundation's budget submission. There is no 
specific request for additional funding for the International Polar 
Year (IPY) in the Department's FY 2007 submission.
    The Department is participating in activities associated with the 
IPY through the Office of Oceans Affairs within the Bureau of Oceans 
and International Environmental and Scientific Affairs (OES/OA). OES/OA 
has provided funding for the Arctic Human Health Initiative, and Arctic 
Council IPY project and is currently reviewing funding requests for IPY 
activities. The Department routinely receives a specific appropriation 
originated by Congress for the Artic Council, which supports activities 
associated with events like the IPY.

    Secretary Rice. Obviously, we have wanted to work with you 
on the Arctic Council, because not only is it important, but 
it's also good for our relations, I think, with Russia, where 
we need more cooperative efforts. And so, if we've not been as 
responsive as we should on that issue, then we will try to be 
more responsive.
    Senator Murkowski. We look forward to working with you on 
this.
    Thank you, Mr. Chairman.
    Secretary Rice. Thank you.
    The Chairman. Thank you.
    Senator Dodd just appeared. Let me just say, the Secretary 
needs to go, but I'll recognize you, Senator Dodd, for----
    Senator Dodd. I understand that, and I apologize to you, 
Madam Secretary. We had a--hearings on Katrina over in the 
Banking Committee with Senator Shelby this morning, with our 
colleagues testifying. And so, I apologize. Trying to be two 
places at once. I just had a meeting with the delegates from 
Mexico over here. We have the Interparliamentary meeting coming 
up in a couple of weeks in Mexico, and I've attended those over 
the last 25 years. And so, in preparation of that, as well, I 
apologize.
    I must say, Mr. Chairman, I noticed, at Coretta Scott 
King's funeral, a very full-throated Secretary of State during 
some of the wonderful music that was at that ceremony. I was 
with my colleague from Delaware. We went down together for 
that. And I commend you----
    Senator Biden. And neither one of us can sing. [Laughter.]
    Senator Dodd. Oh, I know. I was jealous.
    Secretary Rice. I'm a minister's daughter.
    Senator Dodd. I gathered that. I was----
    Secretary Rice. I grew up in church choirs. [Laughter.]
    Senator Dodd [continuing]. I was thinking that. Let me 
raise a--and I gather you've been over a lot of the issues that 
I would have raised, and substantive matters here, before the 
committee--obviously, Haiti and occurrences in Latin America. 
And I know you're busy. I want to raise a subject matter with 
you, Madam Secretary, that is obviously somewhat sensitive to 
people--but I know Senator Kerry addressed this, to some 
degree--but the issue of these unauthorized wire taps has come 
up recently, and the declassification of classified materials. 
And when you were the National Security Advisor, I gather 
decisions were made to go forward with these wire taps, outside 
of the Foreign Intelligence Surveillance Act, the FISA Act. And 
I'd be remiss if I didn't ask you here to shed some light on 
all of this, since this was the time period when you were 
sitting in that chair. What role, if any, did you play in the 
administration's decision to undertake any of these wire taps 
without warrants? Were you aware they were going on at the time 
without recourse to the FISA process? And why was this 
necessary? If you might shed some light with us, please.
    Secretary Rice. Certainly. Senator, I will not try to speak 
to the authorities question. I think the Attorney General has 
spoken to that, and is better positioned to speak to that. But 
this was done under the President's authorities, the 
constitution, and also under statute. But from the point of the 
view of the National Security Advisor--that is, from----
    Senator Dodd. Right.
    Secretary Rice [continuing]. The security point of view--I 
was, indeed, aware. I felt very strongly that what the 9/11 
experience had told us was that we had a gap between what was 
going on--an intelligence gap between what was going on inside 
the country, in terms of cells that were operating here, 
hijackers who, indeed, were operating in the country and 
communicating to people outside the country about those 
terrorist acts, and that that was a scene that we had to close. 
And the assessment of the professionals was that the FISA--and, 
by the way, we used FISA, and used it aggressively--but that 
FISA would not permit the kind of rapid and flexible and quick 
use of the surveillance in order to pick up the conversations 
that would be taking place between people who might have 
intentions to hurt us here and people plotting and planning 
outside the country.
    I was convinced, myself, that this was a program that was 
limited in its scope to terrorism, that it was a program that 
was under the President's authorities, and that it was a 
program that was absolutely necessary.
    Senator Dodd. Was there any debate about the issue of 
sidestepping the FISA requirements, that you can recall?
    Secretary Rice. I think, Senator, had the President 
believed, and had we believed, that it was possible to do this 
under FISA, that that would have been done. But the nature of 
what was being done here, which is not against the kind of 
fixed----
    Senator Dodd. I think we agree on that.
    Secretary Rice [continuing]. Longer term targets----
    Senator Dodd. I think all of us sort of agree on that. I 
listened, over the weekend, to our former Democratic leader, 
Tom Daschle, and Jane Harman, as well as the two Republican 
leaders of intelligence, and I found that they sort of 
expressed my views. All of us sort of agree that we ought to 
have a program that allows us to be able to protect America, 
where there is conversations occurring here.
    The issue really was about this--the issue of the 
warrantless decision. And that's the hub of the question, 
really; not whether or not there ought to be a program, but 
whether we step aside the warrant approach on this thing.
    Secretary Rice. I understand, Senator. And my only point to 
you is that I was convinced--I think, along with others--that 
we did not have the option of doing it under FISA, as it 
currently existed, and that it did not give the kind of agility 
and flexibility that was needed for the specific kinds of 
programs that needed to be run.
    Senator Dodd. Do you know--are you aware that FISA does 
allow for retroactive approval? So, you can actually conduct 
the wire tap, and then go back and get the approval, after the 
fact.
    Secretary Rice. I am aware, Senator, but there--those who 
do this for a living had conversations with the President, and 
with all of us, about what was required, and that FISA did not 
give the kind of agility and flexibility that was necessary to 
do it. And I, frankly, felt that we were blind and deaf at the 
time of September 11, and that our highest obligation was not 
to be blind and deaf again.
    Senator Dodd. Let me quickly--and I--again, you're being 
patient with your time, and I appreciate it, but I wanted to 
ask about the declassification of classified materials, as 
well. And I realize I'm going back a bit here to your earlier 
job here. But there have been reports lately that Scooter Libby 
was authorized to discuss portions of the national intelligence 
estimate--I think that was the report, anyway--of that 
document, related to Iraq, with reporters by his superiors--
that was the question there--by his--authorized to speak by his 
superiors. And I wonder if you might share just a--let me just 
ask a couple of these questions and have you respond in general 
rather than going through question to question.
    One, if you could share with us, Who were Mr. Libby's 
superiors, at least in your mind at that time? What was the 
process at the White House and the National Security Council 
for declassification materials, if there was one? Is it 
governed by executive order, which I gather some have suggested 
might be the case? Or has the President delegated this 
authority to others, which I gather he might be able to do, as 
well? And do you have such authority--did you have such 
authority, as National Security Advisor, that has been 
discussed here? And do you have it now? And would it have been 
appropriate for, say, the Vice President, in your view, to 
authorize Mr. Libby to discuss these portions of the national 
intelligence estimate on Iraq with reporters?
    I mean, it's a very important line of questioning here, in 
terms of what happened on this thing. And I, again--you're 
Secretary of State today, but you were NSC, and it's important 
that we try to clarify it.
    Secretary Rice. Senator, I don't really think that I should 
comment on things that have arisen in the context of a legal 
case and investigation. I would only say that, as I said--and 
Senator Kerry asked a similar question--that I believe that 
it--that the protection of classified information is among our 
highest responsibilities and duties, that it must--that our 
responsibility to follow the law in that regard is a very high 
duty. And I fundamentally believe that I always did follow the 
law in the exercise of my duties.
    Senator Dodd. Putting aside Mr. Libby, per se, just as a 
process question alone, is there--is there a process which 
allows for people to talk with reporters about classified 
material, that we're not aware of, that we should be aware of?
    Secretary Rice. Senator, there is a process of 
declassification.
    Senator Dodd. Right. We know that.
    Secretary Rice. And I believe that I have always followed 
the law in this regard. I really don't think I can comment 
further, because this has arisen in a legal matter.
    Senator Dodd. OK.
    Well, Mr. Chairman, I might just suggest, at some point, we 
may want to, as a committee--I leave this up to you and Senator 
Biden to talk about, but it might be worthwhile for this 
committee to--maybe in a private setting, to be--have a further 
discussion about this, because it's an important matter, 
obviously, the declassification of materials and how it occurs, 
here. And I might suggest that be a way we might proceed.
    And, again, I--it's not my intention here--maybe at the 
last minute here--but, obviously, these are important 
questions, and they did involve your--during your watch. And 
so, I felt compelled to raise them with you and--here. And I'd 
like to pursue them a bit further, if I could. But, obviously, 
we are stretching time limits here. But those are two important 
matters I'd be interested, Mr. Chairman, in seeing the 
committee examine in some forum that might allow us for further 
discussion on it.
    The Chairman. Well, it's an important issue, and--for the 
whole Senate, and obviously for our committee. And so, I'll 
take that under advisement with the distinguished ranking 
member.
    Senator Dodd. I thank you.
    The Chairman. Thank you so much, Secretary Rice----
    Secretary Rice. Thank you very much----
    The Chairman [continuing]. For your testimony----
    Secretary Rice [continuing]. Mr. Chairman.
    The Chairman [continuing]. And for your forthcoming----
    Secretary Rice. Mr. Biden, thank you.
    The Chairman [continuing]. Responses. It's great to have 
you here.
    Secretary Rice. Thank you very much. It's good to be with 
you.
    The Chairman. This hearing is adjourned.
    [Whereupon, at 11:55 a.m., the hearing was adjourned.]
                              ----------                              


              Additional Material Submitted for the Record


 Prepared Statement by Senator Christopher J. Dodd, U.S. Senator From 
                              Connecticut

    Mr. Chairman, thank you for providing an opportunity for members of 
the committee to hear from Secretary Rice and to share our thoughts and 
concerns with her on the direction of United States foreign policy and 
more generally on the standing of the United States globally.
    Madame Secretary, you have expressed satisfaction with the modest 
increase in the FY 2007 foreign affairs budget. At the appropriate time 
I will be interested in hearing from you how you see the various 
components of that budget furthering U.S. interests around the world.
    In glancing through the Department of State's FY 2007 budget 
submission to the Congress, I came across a quote from you, Madame 
Secretary. You stated, that ``The President set a bold mission for our 
Nation, and to achieve it America needs an equally bold diplomacy--a 
diplomacy that not only reports about the world as it is, but seeks to 
change the world itself.''
    It would seem to me to be quite a leap from ``reporting about the 
world'' to ``changing it.'' Shouldn't we first be trying to develop a 
much greater understanding of what is happening around the globe--in 
the Middle East, in Iraq and Afghanistan, in Latin America, on the 
Korean Peninsula, in the People's Republic of China, in Russia and the 
former Soviet Republics?
    Any why?
    Why, for example did the Palestinian people vote for the likes of 
Hamas--a terrorist organization which openly seeks the destruction of 
Israel.
    Why does the newly elected President of Iran seem not to miss any 
opportunity to provoke the United States?
    Why are our efforts to reach agreement on fundamental reforms at 
the United Nations resisted by governments who should have every reason 
to want a strong and functional United Nations?
    Why has the Muslim community been so susceptible to efforts by 
agitators to use the publication of a dozen admittedly objectionable 
cartoons in an obscure Danish newspaper to mount violent protests in 
selected cities in Europe and the Middle East?
    Why is one Latin American country after another electing left of 
center, nationalist candidates to office?
    It seems to me that it is very premature and dangerous to careen 
ahead remaking the world in our own image without fully assessing 
whether we have any chance of succeeding, how those efforts will be 
received by others around the global, and most important of all, what 
those changes are likely to mean for U.S. economic, political, and 
national security interests.
    I am encouraged of late by the more deliberative, cautious, and 
cooperative approach that the administration has adopted in a number of 
areas--with respect to the recent Palestinian elections, a willingness 
to cooperate with European efforts to thwart Iran's nuclear ambitions, 
a wait-and-see attitude toward the Bolivian elections to mention but a 
few.
    I hope this is a signal that the administration has begun to chart 
a new course--a course that embraces multilateral cooperation and 
respect for the rule of law, and one that rejects preemption and 
unilateralism unless vital U.S. interests can only be served by acting 
alone. I strongly believe that U.S. interests will be more effectively 
served by this approach.
    Again, Madame Secretary, I join with my colleagues in welcoming you 
to the committee this morning.
                                 ______
                                 

 Responses of Secretary Condoleezza Rice to Questions Submitted by the 
                           Following Senators

                   Questions of Senator Joseph Biden

    Question. In the formation of a new Iraqi Government and 
constitutional review process thereafter, we are in the midst of what 
may be the last chance to convince Sunni Arabs that they have a stake 
in the new Iraq.
    (a) Please describe your strategy for involving Sunnis in the 
political process and breaking them off from the insurgency.
    (b) How are you coordinating international efforts to pressure the 
three groups toward creating a government of national unity and making 
constitutional promises? What actions have you personally taken and do 
you plan to take to advance these objectives? Have you revisited the 
idea we discussed during your last appearance--and endorsed by 
Secretaries Powell, Kissinger, and Shultz--of establishing a contact 
group that includes the major powers and key Iraqi neighbors?

    Answer. (a) As articulated in the National Strategy for Victory in 
Iraq, we have an integrated approach that incorporates political, 
economic, and security tracks aimed at building a democratic, 
pluralistic, and stable Iraq. In partnership with our Iraqi 
counterparts, MNF-I and the coalition members, we have pursued a 
strategy to isolate those elements in Iraqi society who can not be won 
over to participation in the political process, while at the same time 
engaging those entities who are yet uncommitted to this process. As 
part of that strategy, we are urging regional leaders to actively 
engage with influential Sunni Arab Iraqis. Much of our and the U.S. 
military outreach is focused on Sunni Arabs. I met with their 
representatives on my last two trips to Iraq.
    The ever-expanding circle of players in the current Iraqi political 
environment, especially among Sunnis, is a good example of how our 
strategy appears to be taking hold; large numbers of Iraqis 
participated in both the October referendum and December 2005 election. 
Strong Sunni Arab participation in both is an indication that our Sunni 
engagement policy is achieving results. It is worth noting that in 
reaction to the tragic Samarra shrine bombing and ensuing violence that 
followed, Iraqi leaders universally condemned the attempt to derail the 
political process and urged calm and constructive dialogue to ease 
sectarian tensions. This is still another sign of the growing support 
for democratic principles emphasizing debate and dialogue over the use 
of violence and intimidation to achieve political goals. Iraq's leaders 
have also successfully hammered out major elements of the government 
framework that can form the basis of a national unity government 
representing the full spectrum of Iraqi society. Finally, as further 
evidence that progress is being made, local political leaders are now 
beginning to talk of mobilizing themselves in preparation for the 
provincial elections. All of these developments are healthy signs that 
Iraqis are moving forward to take responsibility for their own futures 
in a way that respects the diversity of others and rejects the use of 
violence. The success of our political track approach mutually 
reinforces our security and economic tracks decreasing dependence on 
U.S. support.
    (b) The USG is committed to actively engaging Iraq's neighbors and 
all international partners on the future of Iraq and the stability of 
the region. Though it is the Iraqis themselves who will need to come to 
an agreement on a government of national unity, a clear and consistent 
international message regarding the importance of such a government is 
vital. The international community's political and tangible support for 
a national unity government, once created, is also essential. With this 
in mind, we have executed a coordinated diplomatic strategy with Arab 
and regional countries, coalition members, other partners, and 
international organizations.
    Travel by Department principals to regional and other countries, 
and outreach to international organizations, NGOs, and international 
financial institutions are also aspects of our international engagement 
strategy. Ambassador Khalilzad has promoted engagement on Iraq in 
visits with Iraq's neighbors including visits to Amman, Riyadh, and Abu 
Dhabi. The recent Arab League engagement with Iraq, including plans to 
open an office in Baghdad, and the November Arab League Cairo 
conference, is another initiative he helped sponsor. We are also very 
supportive of efforts by regional leaders; here King Abdullah of Jordan 
deserves special credit to reach out to Iraqis. Foreign ministerial 
meetings, international summits, bilateral meetings, official visits, 
and many congressional delegations are also reinforcing our objective 
of increased international support for an Iraqi Government of national 
unity. In every appropriate venue, we will continue to urge 
international partners to support Iraq politically by encouraging 
political compromise and the creation of a government representative of 
all Iraq's citizens.
    Our current focus on formal international engagement begins with 
the United Nations, in the Security Council, in a series of high-level 
``Iraq Strategic Dialogue'' talks we conduct with the U.N. Secretariat, 
and on the ground with our close contacts with the Iraq U.N. Mission. 
We have agreed with the United Nations to consider a Baghdad-based 
neighbors and others contact group of ambassadors. We are also working 
with two regional/international fora on Iraq--the Arab League 
initiative noted above, which plans a major Baghdad conference later 
this year, and the World Bank/UNDP-led International Reconstruction 
Fund Facility for Iraq (IRFFI) efforts to coordinate dozens of key 
international donors. Several major IRFFI meetings are also planned for 
this year.

    Question. Earlier this month, the committee heard testimony from 
the State Department, USAID, GAO, and Inspector General Bowen. By most 
critical measures--electricity, drinkable water, sewage treatment, and 
oil production--Iraq is actually worse off today than before the war. 
And billions of dollars have gone missing.
    Going forward, it is clear that most of the administration's goals 
for the reconstruction program will not be met. As security costs rise, 
a ``reconstruction gap'' has developed and hundreds of projects may end 
up unfinished unless additional reconstruction aid is produced in far 
greater amounts than the $735 million that is contained for Iraq in the 
FY 2007 budget proposal.

   How will we make up this ``reconstruction gap'' between 
        projects planned and projects likely to be completed?
   Are the initial goals of the Coalition Provisional Authority 
        still operative, for example, on electricity, oil production, 
        and potable water? When the $18.4 billion has been expended, 
        which of the CPA's goals do you expect to be met and which 
        won't?

    Answer. The Government Accountability Office (GAO) and the Special 
Inspector General for Iraq Reconstruction (SIGIR) have provided 
valuable suggestions for managing our reconstruction efforts in Iraq. 
In fact, as SIGIR points out, we will complete fewer construction 
projects under the IRRF program than initially planned in 2003. There 
are a variety of reasons for this.
    Our reconstruction priorities have changed in response to the 
evolving situation on the ground and priorities of the Iraqi 
Government, which has requested smaller projects that are easier to 
sustain and have an immediate impact on individual communities. For 
these reasons, the initial CPA goals should not be considered the 
current measures of success. The increase in insurgent attacks since 
2004 has resulted in a greater percentage of IRRF funding being devoted 
to improving the capacity of Iraqi Security Forces.
    Despite many challenges, we have been successful in improving the 
delivery of essential services to Iraqis in several areas, including 
the water sector and sewage services, where we have provided access to 
potable water for an additional 3.1 million people, and access to 
sewage treatment for an additional 5.1 million people. We have 
increased immunization of Iraqi children against childhood diseases: 
Now more than 96 percent of children under the age of 5 have been 
vaccinated against measles, mumps, rubella, and polio.
    In designing the IRRF II program, initially of approximately $15 
billion for civilian reconstruction (not counting the initial security 
forces component of $3 billion placed in the IRRF legislation), the 
United States was aware that it could not ``rebuild'' Iraq's 
infrastructure, which had been run down by decades of mismanagement, 
war, and tyranny. U.S. assistance programs are helping to build or 
refurbish the basic infrastructure that will enable Iraqis to 
significantly expand the delivery of essential services. In addition to 
ongoing projects, the level of service delivery will be further 
enhanced by improvements in Iraqi capacity, subsidy reforms, and a 
decrease in infrastructure attacks as the Iraqi Security Forces 
continue to improve their ability.

    Question. After your October 19, 2005, testimony before the 
committee, among the questions for the record I submitted to you, I 
asked that you provide the committee with a breakdown by Iraqi 
governorate of both obligated and committed U.S. funds across the 
country. Your response indicated that ``the Department will seek to 
respond to your request for a breakdown of U.S. assistance programs, by 
governorate, more completely by the end of November.'' To the best of 
my knowledge, the committee has still not received this information. 
Please provide it.

    Answer. Last fall, the Department promised to respond to your 
request for a breakdown of U.S. assistance programs by governorate. We 
are pleased to provide the attached set of seven maps, which provide an 
indicative picture of the distribution of construction programs in the 
following sectors of the Iraq Relief and Reconstruction Fund (IRRF): 
Electricity; water and sanitation; justice, public safety, 
infrastructure and civil society; oil; roads, bridges and construction 
(including school projects); transportation and telecommunications; and 
health.
    The totals in each of the sectors are current as of February 11, 
2006, and do not include overhead or contingency reserve funds, or 
projects which have not yet been obligated. They also do not include 
construction contracts issued through the Multinational Strategic 
Transition Corps-Iraq (MNSTC-I), which deal with the security sector of 
the IRRF. The distribution may change as remaining IRRF funds are 
obligated.
    IRRF programs are designed, after consulting with Iraqi 
authorities, first and foremost according to what is needed to 
facilitate Iraq's transition to self-reliance and prosperity. Equitable 
geographic distribution is a factor in this process, but is not the 
sole determinant for any IRRF project.

    [Editor's note.--The maps provided could not be converted for print 
and will be maintained in the committee's permanent files.]

    Question. The President's ``National Strategy for Victory in Iraq'' 
says that success will depend ``on the conditions on the ground in 
Iraq.'' (emphasis in original) The Strategy document lists the victory 
conditions as including: ``Progress in the Iraqi political process and 
the increasing willingness of Iraqis to forge political compromises, 
consolidation of gains in the training of Iraqi Security Forces, 
commitment to, and implementation of, economic reforms by Iraqi 
leaders, increased cooperation of Iraq's neighbors, and expanded 
support from the international community.'' You made passing reference 
to these conditions during your testimony.
    (a) What constitutes success in each of these five areas?
    (b) What specific metric is the U.S. Government using to determine 
progress in each of these five areas? How are we performing against 
these metrics?
    (c) What economic reforms have been undertaken by the Iraqi 
transitional government? In view of the administration, what further 
reforms are required once a permanent government is seated?
    (d) What would constitute cooperative policies by the Syrian and 
Iranian Governments in Iraq? What, if anything, is the administration 
doing to promote them? How do you assess current Syrian and Iranian 
policies in Iraq? Have there been any areas in which Syrian and Iranian 
Governments have been constructively engaged in Iraq?

    Answer. (a&b) The President's ``National Strategy for Victory in 
Iraq'' (NSVI) outlines goals and measures progress in Iraq along three 
tracks: Political, security, economic. The administration provides 
regular updates to Congress and the American people on our progress to 
meet these goals and measures, including through the Iraq Weekly Status 
Report, the Measuring Security and Stability Report, and the U.S. 
Policy in Iraq Act Report.
    Stable, pluralistic, and effective national institutions that can 
protect the interests of all Iraqis, and facilitate Iraq's full 
integration into the international community constitutes success in the 
political track. The metrics used by the USG to measure progress in 
this area include the number of Iraqis willing to participate in the 
political process, Iraqi integration into the international community, 
and political benchmarks set forth by UNSCR 1546 and the Transitional 
Administrative Law. Building on two prior electoral successes, over 
12.2 million Iraqi voters (78 percent of eligible voters) went to the 
polls on December 15, 2005, despite the threat of violence, to elect a 
Council of Representatives (CoR), the first step to government 
formation. The result has been a political process that includes all of 
Iraq's major communities with broad-based, across-the-board buy-in. We 
are particularly heartened by both the large Sunni Arab turnout in the 
December elections especially when compared to the virtual boycott in 
January 2005, and the productive involvement of the Sunni political 
leaders, whose groupings won over 20 percent of the parliamentary seats 
in government formation and program talks.
    In an effort to engage more Arab support for Iraq, the Secretary of 
State's Special Coordinator for Iraq initiated intensive consultations 
with key Arab States. The November 2005 Arab League meeting resulted in 
a call for Arab States to cancel or reduce Iraqi debt, increase 
assistance, and enhance their diplomatic presence in Iraq. 
International partners, excluding the United States, pledged over $13.5 
billion in economic aid at the 2003 Madrid Conference. The United 
Kingdom, Italy, and others have expressed an interest in the Provincial 
Reconstruction Teams. Based on the creation of the Iraqi Constitution, 
successful elections, support from the international community, and 
movement, albeit slow, on formation of a unity government in Iraq, the 
USG has seen substantial progress in the political track.
    Along the security track, an Iraqi Security Force (ISF) capable of 
independently providing security and maintaining public order in Iraq 
constitutes success in this track. The USG uses specific metrics to 
track progress including, the number of trained and equipped ISF 
personnel, readiness of operational units, percentage of operations 
conducted by Iraqis alone, and ISF progress in assuming battle-space 
control. As of March 20, there were more that 111,000 trained and 
equipped soldiers, sailors, and airmen. More than 89,000 police have 
been trained and equipped. Overall, more than 250,000 Ministry of 
Defense and Ministry of Interior forces have been trained and equipped. 
Currently, 49 Iraqi Army battalions now control their own battle space. 
Today, much of Baghdad is under ISF control along with Najaf and 
Karbala as well as parts of other provinces. The increased capabilities 
of the ISF, particularly the army, were illustrated in their efforts to 
prevent violence from escalating after the February 22 Samarra bombing. 
Based on these and other metrics, the USG has seen steady progress 
along the security track.
    Success along the economic track is constituted by the capacity of 
Iraqi institutions to maintain essential services, rejoin the 
international economic community, and improve the general welfare of 
all Iraqis. Success along this tract is measured by GDP, per capita 
GDP, rate of inflation, provision of essential services such as water 
and electricity, barrels of oil produced and exported, numbers of 
businesses opened, and employment levels, along with progress of the 
reform agenda described in (c) below. There have been some notable 
successes in the provision of essential services thanks to U.S. funded 
projects, including increasing access to fresh water for 5.1 million 
Iraqis and to sewage facilities for 3 million Iraqis. U.S.-funded 
projects have also supported nationwide vaccinations against measles 
and rehabilitated approximately 30 percent of Iraq's schools. The 
impact of U.S.-funded projects in the oil and electricity sectors have 
been reduced by insurgent attacks. Despite terrorist efforts, Iraq's 
economy grew from $18.9 billion in 2002 to $33.1 billion in 2005. The 
IMF estimates that the real GDP grew by 2.6 percent in 2005 and expects 
it to grow by 10.4 percent in 2006, with commensurate growth in per 
capita GNP, and a recent significant drop in unemployment. While the 
Iraqi economy continues to be overwhelmingly dependant on oil, other 
sectors are developing, including services and trade. Ongoing U.S. 
assistance projects will help Iraq enact economic reforms needed to 
sustain long-term growth, including commitments under the IMF Stand-By 
Arrangement and reforms needed to join the WTO.
    (c) Since 2003, Iraq has implemented a new stable currency, 
negotiated a historical debt relief agreement with the Paris Club, 
started the process of acceding to the World Trade Organization, 
successfully concluded an Emergency Post Conflict Agreement with the 
IMF, and negotiated a follow-on standby arrangement. As part of its 
agreements with the IMF the government undertook several economic 
reform initiatives. It legally established the independence of the 
Central Bank, and commissioned an outside audit of the Central Bank. It 
started reform of the national budget accounting process, moving from 
the current manual system to a modern electronic system that meets 
international standards. It took a major first step to reform Iraq's 
distorting fuel subsidy program by raising prices for all fuel products 
last December, many by a factor of 500 percent. It is developing a 
national payments system that will link the Central Bank to commercial 
banks, improving efficiency in the banking system and strengthening 
bank supervision capabilities.
    There are several priority items for continued economic reforms. 
The first is increasing budget transparency by adding meters on oil 
production, improving fiscal discipline in the ministries, and 
improving ministerial capacity to manage contracting. Second, the 
independent government auditing institutions, Board of Supreme Audit, 
Commission for Public Integrity, and the inspectors general need to be 
strengthened. Third, Iraq needs to continue its subsidy reform efforts 
to bring fuel prices to regional market levels and to eliminate the 
government monopoly on importing refined fuels. At the same time, it 
must continue development of a social safety net to shield vulnerable 
populations from the impact of these price increases. Finally, to 
encourage investment (both foreign and domestic) the government needs 
to carry through on legal reform of its commercial code as outlined in 
its Foreign Trade Memorandum to the World Trade Organization and it 
needs to reform and modernize the moribund banking sector.
    We are working with the government to support their efforts to 
implement these priority reforms.
    (d) The Syrian Government has not yet taken sufficient steps to 
better secure the Syria-Iraq border and stop the transit of foreign 
fighters to Iraq. Syria remains a transit point for anticoalition 
elements traveling to Iraq, both Iraqi Former Regime Elements and 
foreign fighters, although Syria has tightened visa entry controls at 
airports on our urging. Syria must stop its territory from being used 
by those seeking to destabilize Iraq and the region.
    Syria must arrest former Iraqi regime officials who are supporting 
the Iraqi insurgency from Syrian territory and hand them over to the 
Iraqi authorities, just as they handed over Sabawi Ibrahim Al-Hasan Al-
Tikriti on February 24.
    Syria has made some progress on its economic commitments with Iraq. 
It returned the $262 million in Iraqi assets that were held by the 
Commercial Bank of Syria to the Development Fund for Iraq. However, 
approximately $580 million in disputed claims have yet to be finally 
resolved. The Syrian and Iraqi Governments signed a Memorandum of 
Understanding on this issue, and working-level discussions have begun 
on the disputed claims. The Syrians insist on a formal high-level trip 
from the Iraqis before establishing formal diplomatic relations, which 
may speed up work on economic disputes.
    Finally, terrorist financiers continue to operate from Syria in 
support of the Iraqi insurgency, a problem that the Syrian Government 
has not yet addressed. Syrian obstruction has prevented the resolution 
of a number of outstanding commitments in Iraq, from economic 
obligations to border security.
    We continue to pressure Syria to stop the flow of insurgents, 
weapons, and financing to Iraq by isolating Syria diplomatically and 
encouraging the international community, particularly the Arab League, 
to do so as well. We continue to train and equip ISF to police the 
Iraq-Syria border and are both building new and refurbishing old Iraq-
Syria border crossings.
    Iranian behavior is counterproductive to the establishment of peace 
and security in Iraq. The USG strongly objects to Iran's support for 
militant groups in Iraq, including the provision of explosives-related 
equipment and technology. For several months, Ambassador Khalilzad has 
had the authority to engage with his Iranian counterpart in Iraq to 
discuss our concerns about Iranian actions that negatively impact 
Iraq's internal security, but for various reasons no talks have as yet 
taken place. We will also continue to work closely with the Iraqi 
Government to address all issues related to Iraq's security and 
stability.

    Question. The administration reportedly has decided not to move 
toward a free trade agreement with Egypt at this time, in part because 
of the Mubarak government's failure to hold free and fair elections and 
its arrest of opposition leaders.

   What specific steps would you encourage Egypt to take to 
        make an FTA possible?

    Answer. A free trade agreement with Egypt is a key component of the 
President's vision for a Middle East Free Trade Area (MEFTA) by 2013, 
and remains a priority obective for the administration.
    I will be traveling to Cairo next week to speak with President 
Mubarak, including about a possible free trade agreement. When I am 
there, I will stress that the United States enjoys an important 
strategic relationship with Egypt. There has been real progress on 
domestic economic and political reform in Egypt during the last 8 
months, but I will note that there have been disappointments and 
setbacks as well. I will talk candidly about these with Egypt--as a 
friend, not as a judge. But as a friend, I will emphasize that we want 
to see an Egypt that is fully developing politically and along the 
lines of reform as well, and we will discuss the future of this reform.
    We are still discussing and will continue to talk about the FTA 
with Egypt. The timing to announce the intention to begin negotiations 
is not right just now, but we want to have an FTA with Egypt because we 
believe that it will make a difference to economic reform and 
ultimately the economy in Egypt.
    A key message that I will carry is that Egypt is a country of 
greatness, and the Middle East region needs this country to be at the 
center of positive change.

    Question. Last year, you told the committee that ``The United 
States is not prepared to tolerate a nuclear-armed North Korea.'' North 
Korea's stockpile of fissile material has grown dramatically over the 
past 3 years, and the former Director of the Defense Intelligence 
Agency, Vice Admiral Lowell Jacoby, told a Senate committee last spring 
that North Korea can arm a missile with a nuclear warhead. You have 
also stated to this committee that, in dealing with this threat, ``We 
cannot accept another partial solution that does not deal with the 
entirety of the problem . . .''
    (a) How long will the administration tolerate North Korea's 
possession of nuclear weapons?
    (b) Do you believe deterrence and containment are adequate policies 
to deal with North Korea? What, if any, new policy approaches are you 
considering?
    (c) Do you believe there are any viable military options to 
eliminate North Korea's nuclear programs?
    (d) Are there any circumstances under which what you have called a 
``partial solution'' would be preferable to no solution at all? Is a 
``partial solution'' incompatible with pursuing a lasting, permanent 
solution? Could not a ``partial solution'' be a step toward a complete 
solution?

    Answer. (a) For over a decade, the United States has assessed that 
North Korea has produced enough plutonium to make one or more nuclear 
weapons. Our objective remains the complete, irreversible, and 
verifiable elimination of the DPRK's nuclear weapons and nuclear 
programs. We are pursuing that objective through the multilateral 
diplomacy of the six-party talks. All six parties (the United States, 
China, Russia, Japan, South Korea, and North Korea) have agreed on the 
goal of denuclearization of the peninsula.
    (b) The September 19, 2005, Joint Statement of Principles contains 
all the elements of a comprehensive solution that advances the 
interests of all parties--economic, political, security. For the DPRK, 
in the context of its complete denuclearization, these include steps 
toward normalization of diplomatic relations subject to bilateral 
policies, provision of energy and other types of economic assistance, 
and enhanced security. In addition, the directly related parties agreed 
to negotiate a permanent peace regime on the peninsula in an 
appropriate separate forum. We have made clear that the process that 
would lead to the DPRK's realization of these benefits will not move 
forward until it returns to the table so that the process of 
denuclearization and implementation of the principles can begin.
    (c) When it comes to protecting our national security, no option is 
off the table.
    (d) Our fundamental objective is the complete, irreversible, and 
verifiable elimination of the DPRK's nuclear weapons and nuclear 
programs. Our policy is to achieve this objective through the 
implementation by all parties of all the provisions of the September 
19, 2005, joint statement. We will also continue to take concrete 
action to protect ourselves and our allies against any illicit and 
proliferation activities by the DPRK.

    Question. The Eugene Bell Foundation has just launched a new 
people-to-people initiative (Saemsori) designed to facilitate 
reunification visits for Korean Americans with their North Korean 
relatives. There are 2 million Korean Americans, and experts estimate 
that perhaps as many as 250,000 of them have relatives in North Korea. 
Another American nongovernmental organization (NGO), Amigos 
International, is completing construction of a private university in 
Pyongyang, the Pyongyang University of Science and Technology, to be 
staffed largely by American faculty. Amigos International also has 
several small-scale agricultural training programs underway inside 
North Korea.
    (a) Does the State Department support these efforts?
    (b) What specific steps will the State Department take to assist 
the efforts of these and other NGOs engaged in humanitarian outreach to 
the North Korean people?

    Answer. (a) The State Department welcomes efforts by American and 
other NGOs aimed at bettering the lives of the North Korean people.
    (b) Other than strictly humanitarian aid, most types of U.S. 
assistance to North Korea are prohibited. The United States has been 
the largest contributor of humanitarian food assistance to the DPRK 
through the World Food Program, contributing about 2 million tons over 
the last 10 years.
    We are prepared to consider funding for proposals for humanitarian 
assistance from NGOs. However, current limitations imposed by Pyongyang 
on access and monitoring by international aid organizations and NGOs 
make it very difficult to assure that the humanitarian assistance we 
might give would reach its intended recipients.
    We have made clear to the DPRK that full implementation of the 
September 19, 2005, Joint Statement of Principles the six parties 
unanimously adopted in Beijing would transform the nature of the 
relationship between our two countries in a way that would make it 
possible for us to consider other forms of assistance to improve the 
lives of the North Korean people. We remain prepared to discuss 
implementation of the provisions of the joint statement, but the 
process, cannot move forward until the DPRK returns to the table.

    Question. Indonesia has arrested eight suspects in the 2002 Timika 
murders.

   Will the administration continue to press the Indonesian 
        authorities to ensure that all those responsible for the Timika 
        murders are brought to justice?
   Are you confident that Indonesia will follow the evidence, 
        wherever it may lead?
   Will the FBI continue to participate actively in the 
        investigation and monitor the prosecutions?

    Answer. The Department of State continues to work closely with the 
Government of Indonesia on this case, in the interest of achieving 
justice for the death of all the victims, including both Americans and 
Indonesians. The Ambassador and senior Department officials remain in 
close contact with Mrs. Patsy Spier, who was wounded in the August 31, 
2002, attack and widow of one of the American citizens killed in the 
attack.
    Both the U.S. Government and Mrs. Spier have impressed upon 
Indonesian officials the importance of achieving justice through a fair 
and credible trial. President Yudhoyono has vowed to follow through and 
has repeatedly expressed and demonstrated his determination to see that 
justice is served.
    After the January 11 arrests, the Government of Indonesia assured 
the U.S. Ambassador that cooperation with the FBI on this case would 
continue; it has. The Indonesian National Police is collaborating 
closely with the FBI and the U.S. Department of Justice in the 
investigation. The Indonesian Embassy in Washington also arranged for 
Mrs. Spier to meet with the Indonesian Attorney General and Justice 
Minister in March during their visit to the United States.

    Question. President Bambang Yudhoyono has expressed his strong 
support for reform of the armed forces, and has already taken 
significant steps to advance democratic reforms, fight corruption, and 
improve the professionalism of the Indonesian Arny.
    (a) What steps will the administration take to promote reform of 
the Indonesian Armed Forces?
    (b) Will you press for an end to the impunity often enjoyed by 
members of the army? Specifically, will you press the Government of 
Indonesia to hand over General Wiranto, who has been indicted by an 
international tribunal for his role in crimes committed by Indonesian 
Army units in East Timor? If not, why not?

    Answer. (a) The administration is actively assisting the Indonesian 
Armed Forces to continue its internal reform process toward becoming a 
modern, professionalized force that respects the rights of its citizens 
and is accountable to civilian authority. Our mil-mil assistance and 
engagement program with the Indonesian Government, including IMET, FMF, 
JCETs, and other assistance is designed to emphasize and facilitate 
such reform. Even more importantly, we are working on many fronts to 
enhance civilian oversight of the military, including strengthening the 
Indonesian Department of Defense (especially with respect to managing 
defense resources), the Indonesian Legislature, and civil institutions, 
including the media. This year the USG will provide over $140 million 
in assistance to civil society and less than $2 million in military 
assistance (IMET and FMF).
    In February 2005, after a determination by Secretary Rice that 
Indonesian authorities were cooperating with the FBI in the Timika 
investigation, the administration reinstated International Military 
Education and Training (IMET) assistance for the Indonesian military. 
By exposing promising military officers to U.S. standards for military 
professionalism and respect for human rights, the IMET program is a 
critical component of the U.S. Government's efforts to promote reform 
of the Indonesian Armed Forces.
    The November 2005 national security interest waiver of 
congressional restrictions on Foreign Military Financing and lethal 
defense exports has allowed the administration to begin constructively 
engaging a reforming Indonesian military in a climate of trust. 
However, it does not mean that the floodgates to advanced U.S. military 
hardware have been thrown wide open. All requests for military 
assistance to Indonesia are considered case by case. Each applicant for 
U.S. training is thoroughly vetted for human rights abuses in 
accordance with Leahy guidelines.
    The administration shares congressional concerns regarding respect 
for human rights, accountability, and civilian control of the 
Indonesian military. As we normalize our military relations with 
Indonesia, we continue to stress, both privately and publicly, that 
military reform and accountability are essential. Indeed, we have more 
opportunities to do that now, because we are in more frequent contact 
with the civilian government and the military. Additionally, the 
Yudhoyono government is becoming more receptive to such engagement 
since we are no longer perceived to be publicly criticizing Indonesia. 
In her March visit to Jakarta, Secretary Rice discussed military reform 
with President Yudhoyono and highlighted its importance in her speech 
at the Indonesian Foreign Ministry. We have made it clear that mil-mil 
normalization is dependant upon the Indonesian military's continued 
reform efforts.
    (b) The overall human rights situation in Indonesia has continued 
to improve over the past year. Significant problems remained--
particularly in areas of separatist conflict--but the end of the 
country's long-running internal conflict in Aceh Province was a major 
step forward. Indonesia has made limited progress in establishing 
accountability for numerous human rights violations committed by the 
security forces, and this is a key area for improvement. There is 
evidence that the TNI has been willing to punish soldiers who have 
committed abuses during the conflict in Aceh, including a total of 160 
convictions for human-rights-related offenses in 2004 and 2005. 
However, as enumerated in the annual State Department Human Rights 
Report, many cases of abuses remain unresolved.
    Achieving accountability and ending the culture of impunity for 
members of the Indonesian security forces is critical for the long-term 
success of Indonesia's democratic transformation. The USG continues to 
emphasize the need to achieve credible accountability for atrocities 
committed in East Timor in 1999, including any member of the Indonesian 
military who may have been responsible. After the failure of previous 
efforts to punish those responsible, Indonesia and East Timor have 
established the Indonesia-East Timor Truth and Friendship Commission 
(TFC). The administration has emphasized to both Indonesia and East 
Timor that, in order to be credible, the TFC must name the names of the 
perpetrators, be transparent, hold public hearings, involve the 
international community, and protect witness confidentiality. The 
administration will continue to work with our Indonesian and East 
Timorese democratic partners to strengthen support for justice within 
their societies. We are also awaiting the U.N. Secretary General's 
briefing to the Security Council on the U.N. Commission of Experts 
report submitted in May 2005.

    Question. South Korea: South Korea is not currently a member of the 
Visa Waiver Program (VWP), but the administration has announced the 
creation of a ``roadmap'' to facilitate Korea's efforts to qualify for 
the VWP. South Korea is the world's 11th largest economy and our 7th 
largest trading partner, and almost a million South Koreans travel to 
the United States every year. Yet we have only one place for South 
Koreans to apply for visas in South Korea, and the Consulate in Seoul 
is the busiest United States Consulate in the world.
    (a) How close is Korea to qualifying for the VWP? Where is South 
Korea still deficient? What steps is the Department taking to assist 
ROK in qualifying for the Visa Waiver Program? How quickly do you 
believe South Korea will be able to qualify?
    (b) Do you support reopening a Consulate in Pusan, not only to 
improve visa services, but also to better represent U.S. interests in 
Korea and expand our presence in this vital treaty ally? If not, is it 
a matter of resources or policy?
    (c) What is your plan to strengthen consular services in South 
Korea to meet the growing demand for nonimmigrant visas?

    Answer. (a) Designation to participate in the Visa Waiver Program 
requires that Korea meet legislative criteria including a low visa 
refusal and traveler overstay rate and a determination that U.S. 
security and law enforcement interests would not be negatively impacted 
by Korean participation in the program. We recognize Korea's work 
toward meeting some VWP legislative criteria including sharing lost and 
stolen passport data and the development of a biometric passport.
    Presidents Bush and Roh included the creation of a Visa Waiver 
Program roadmap for the ROK in their Joint Declaration In Gyeongju in 
November and we are working to finalize this roadmap. The U.S. Embassy 
in Seoul and the ROK's Ministry of Foreign Affairs have established a 
Visa Issues Working Group that meets quarterly to discuss consular 
issues of mutual concern, including steps the ROK would need to take to 
meet the requirements for inclusion in the Visa Waiver Program.
    (b) The Department is considering the establishment of a small 
limited-purpose presence in Pusan, but no decision has been made at 
this time. However, these one- or two-person offices (designated as an 
American Presence Post) generally do not issue visas or provide routine 
consular services.
    (c) Seoul's consular section has upgraded its facilities and added 
staff to process Korean applicants more quickly and efficiently. Last 
year, we processed 400,000 visa applications, an increase over the 
previous year. Appointment wait times have dropped substantially, to 3 
days currently, from 30 days a year ago.

    Question. Since taking office, President Bush has generally pursued 
a policy of quiet, personal diplomacy when managing the United States 
relationship with Russia. However, a number of recent developments 
raise serious concerns about whether this approach is yielding 
dividends. As you know, in the last few years, the Russia Government 
has restricted the work of nongovernmental organizations, consolidated 
control over Russia's political system and natural resources, virtually 
eliminated independent broadcast media outlets, interfered in the 
elections and economies of neighboring countries, and offered to 
negotiate with the leadership of Hamas. How much longer do current 
trends in Russia need to continue before the administration reevaluates 
its approach to dealing with Moscow?

    Answer. The United States constantly reevaluates its dynamic 
relationship with Russia and other countries, in keeping with the 
Department of State's mission to ``create a more secure, democratic, 
and prosperous world for the benefit of the American people and the 
international community.'' Such review is an ongoing process.
    We are troubled by trends within Russia, especially with respect to 
democracy and human rights, and have expressed those concerns to 
Russia, both publicly and privately. The United States and its allies, 
for example, actively communicated their concerns during the course of 
debate on the new NGO law that President Putin signed in January. We 
are closely observing the process of its implementation, and have 
emphasized to Russian officials the importance of fair, transparent, 
and consistent application of the law so as to foster, rather than 
hinder, the vital work NGOs perform. We seek the same transparency, and 
hold the same frank dialogue, in discussing domestic and international 
issues with Russia.
    President Bush has repeatedly stressed--most recently at Freedom 
House March 29--that it is critical ``for the United States to be in a 
position to be able to express our concerns'' to Russia, and that this 
involves a relationship of engagement enabling ``candid conversation.'' 
Those conversations do not always immediately lead to our desired 
outcome, but they allow America's voice and concerns to be heard loud 
and clear.

    Question. When you were in Moscow last April, you said (in an 
interview with CBS): ``What we need to do is to be very clear with the 
Russians that the deepening of United States-Russia relations is in 
large part dependent on common values and on continued democratic 
development in Russia.'' Since then, you have been candid about the 
setbacks to democracy in Russia, from its crackdown on NGOs to Putin's 
centralization of power--stating recently that Russia seems to be 
``going in the wrong direction'' with respect to democracy. And yet you 
have also said that the United States has ``very good relations with 
Russia, probably the best relations that have been there for quite some 
time.'' If improved U.S. relations with Russia depend on continued 
democratic development there, then how can our relationship be the best 
it has been for quite some time?

    Answer. The United States is deeply concerned and very candid about 
setbacks to democracy in Russia. We regret that President Putin has 
pursued policies in many ways inimical to the robust evolution of 
Russian democracy. We have clearly and repeatedly expressed our 
concerns about specific areas where Russia's policy--such as the new 
NGO law or the decision to appoint rather than elect regional 
governors--stymies democratic development. We have publicly urged 
Russia to embrace democratic development more vigorously.
    But, as I stated in an interview in February, it is also important 
to maintain some historical perspective on the remarkable changes we 
have seen in Russia during the past 15 years. ``Obviously we are very 
concerned, particularly about some of the elements of democratization 
in Russia that seem to be going in the wrong direction. [But this] is 
not the Soviet Union; let's not overstate the case. I was a Soviet 
specialist. I can tell you that Russia bears almost no resemblance to 
the Soviet Union.''
    President Bush has also emphasized the importance of historical 
perspective: History is on the side of freedom. Speaking at Freedom 
House, March 29, he reminded us that the ``advance of freedom is the 
story of our time,'' and that ``it's an interest of a country like 
Russia to understand and welcome democracy.'' That is why President 
Bush is committed to engaging with Russia in frank discussion, aware 
that this path may not yield immediate solutions, but still promises 
the best long-term way of achieving the kind of cooperative bilateral 
relationship we are seeking with Russia on many of our key strategic 
interests.

    Question. In the last year, the Government of Uzbekistan massacred 
several hundred unarmed antigovernment demonstrators in the city of 
Andijan, cracked down on all forms of dissent in the country, and 
expelled U.S. forces from their base in southern Uzbekistan, though the 
mission they were supporting in Afghanistan was far from over. Since 
then, the administration has condemned the Uzbek Government's actions 
and aided Uzbek citizens seeking refuge in third countries.
    (a) What concrete steps has the administration taken since the 
Andijan massacre to pressure the Uzbek regime to change its policies?
    (b) Why has the administration not followed the European Union in 
imposing targeted sanctions against the Uzbek leaders responsible for 
the massacre?

    Answer. (a) In response to the Andijan events, the U.S. immediately 
and repeatedly called for an independent, international investigation. 
We also undertook an immediate review of U.S. assistance to Uzbekistan. 
As a result, aid to the Government of Uzbekistan was severely limited; 
numerous military, border security, and economic reform assistance 
programs were canceled. Approximately $3 million of these funds were 
reprogrammed to support additional democracy and human rights programs 
in Uzbekistan. When allowed, the United States monitored the cases and 
trials of dissidents and political opponents of the Government of 
Uzbekistan, including those accused of involvement in Andijon. The 
United States also supported and voted for a U.N. Third Committee 
resolution on Uzbekistan.
    (b) We note the European Union's decision to impose sanctions on 
the Government of Uzbekistan for its failure to heed calls from the 
international community, including the United States, to allow an 
independent, international investigation into the tragic May 2005 
events at Andijan.
    We do not rule out the potential of imposing our own sanctions on 
Uzbekistan, should respect for democracy and human rights continue to 
deteriorate. We have repeatedly stressed to the Government of 
Uzbekistan that our bilateral relationship must include genuine 
progress on human rights and democracy.

    Question. According to the Office of the Inspector General (OIG 
Report No. ISP-I-06-13A, Inspection of Embassy Kabul, Afghanistan, 
January 2006, pp. 39, 41), in September 2002 the Department awarded a 
$115 million cost-plus contract for embassy construction to the firm 
Kellogg Brown and Root (KBR). At the time of inspection, the 
construction had been drastically reduced in scope, was nearly a year 
past its original completion date (December 2004), had already cost 
$147 million (28 percent more than the originally agreed amount), and 
had produced ``work that is below acceptable standards.''

   Do you consider KBR's record for work done on Embassy Kabul 
        to be satisfactory?
   Does KBR remain on the list of preapproved contractors 
        eligible to bid on embassy construction projects?

    Answer. The OIG report stated that, ``Despite concerted efforts by 
Overseas Building Operations (OBO) personnel on site to hold KBR to 
high standards, OIG became aware of some finish work that is below 
acceptable standards.'' (p. 41.) The OIG visit coincided with issuance 
of a certificate of substantial completion. As is standard in the 
construction process, those items not meeting standards were placed on 
a ``punch list'' for the contractor to correct.
    With regard to cost and schedule, the contract was originally 
awarded on a cost reimbursement basis because it was determined that no 
contractor would be able to assess the logistic and security risks 
associated with the construction without including enormous 
contingencies in a fixed-price bid. When it became apparent that the 
original cost estimate would be substantially exceeded and the 
contractor had obtained detailed familiarity with the work and 
conditions, OBO negotiated a contract modification with KBR to convert 
the contract to firm, fixed-price in order to preclude any further 
price escalation.
    As with other contractors that are eligible to bid embassy 
construction projects, KBR participated in a source selection 
evaluation process that deemed the firm eligible to compete for 
additional work. Firms do not simply ``remain'' on a list of approved 
contactors but rather are evaluated against many factors including past 
performance each fiscal year.

    Question. By letter dated February 4, 2005, other Senators and I 
wrote to express concern that the administration would seek authority 
in the FY 2005 supplemental for the Department of Defense to train 
police forces of other countries, including the Afghan national police. 
You replied on March 25, 2005, stating that the funds requested in the 
FY 2005 supplemental for acceleration of the Afghanistan police 
training program would be ``directed to the Department of State, which 
is the agency currently responsible for implementing this program.''

   Is it still the case that the Department of State is 
        responsible for the Afghanistan police training program, or is 
        the Department of Defense the lead agency? If it is the latter, 
        what is the current role of the Department of State with regard 
        to this function?

    Answer. Public security and the rule of law are critical for all 
future rebuilding efforts and for providing long-term stability to the 
people of Afghanistan. The goal of the USG Afghanistan Police Program 
(APP) mission is to help Afghanistan develop a competent, professional, 
democratic police force with the necessary training, equipment, 
infrastructure, institutional capacity and organizational structure to 
enforce the rule of law in Afghanistan.
    In April 2005, Embassy Kabul reported on the arrangement State and 
DOD reached to ensure that security sector reform efforts in 
Afghanistan are closely coordinated. State and DOD agreed that the 
Office of Security Cooperation--Afghanistan (OSC-A) would be 
established with program implementation and oversight responsibility 
for all security sector programs--including the Afghanistan Police 
Program (APP). OSC-A has since changed its name to Combined Security 
Transition Command--Afghanistan (CSTC-A), but State and DOD's APP 
responsibilities remain the same.

   INL continues to be responsible for implementation of 
        training, mentoring, and reform programs;
   The Chief of Mission continues to develop policy guidance; 
        and
   DOD provides integrated oversight for implementation on the 
        ground.

    The Ambassador and the CFC-A Commander work very closely together 
to monitor all aspects of APP development, and there is strong 
interagency cooperation and coordination between DOD and State on this 
program.

    Question. Please explain in detail what assistance we are asking 
NATO to provide the African Union (AU) Mission in Sudan in advance of 
the deployment of a United Nations peacekeeping mission for Darfur? How 
does what we are requesting NATO to provide in advance of a U.N. 
mission in Darfur differ from what NATO is already doing to help the 
AU?

    Answer. The United States strongly supports expanded NATO 
assistance to the African Union Mission in Sudan (AMIS). A precisely 
targeted assistance mission focusing on capacity-building and mentoring 
of AMIS headquarters elements during the transition to a U.N. force in 
Darfur could help increase AMIS capability. NATO should concentrate its 
assistance for AMIS headquarters on hands-on training and staff 
capacity-building with particular focus on helping the AU establish a 
Joint Operations Center (JOC) and a Logistics Coordination Hub in 
Darfur. NATO personnel could deploy to AMIS headquarters to conduct 
courses on the structure and operation of a JOC and logistics hub and 
then remain in place to mentor AU staff officers. Additionally, the 
Alliance could consider the provision of intelligence and expanding 
capacity-building to AMIS sector headquarters in Darfur.
    Finally, NATO would continue to airlift AU troop contributions into 
Sudan. If approved by the North Atlantic Council and the African Union, 
these assistance options would represent a significant increase in NATO 
support to AMIS. Previously, NATO had airlifted 7 AU battalions, 
provided 14 NATO personnel to train 125 AU staff officers in El Fasher 
and Addis Abba, and supported a U.N.-run training exercise. The 
measures currently under consideration at NATO would provide more NATO 
personnel training a greater number of AU officers for longer periods 
of time with the option of continued mentoring after training 
concludes. In particular, expanded capacity-building to AMIS sector 
headquarters outside of El Fasher could significantly improve AMIS's 
ability to coordinate and manage the mission in Darfur.

    Question. Are there currently legislative impediments that prevent 
the United States from providing certain types of assistance that the 
administration feels are necessary to support the Government of 
Southern Sudan (GOSS)? If so, please explain what the impediments are, 
and what assistance, specifically, the United States has been prevented 
from giving to the GOSS. Will the administration consult with Congress 
to ease restrictions that it feels prevents provision of assistance to 
the GOSS?

    Answer. The United States foreign assistance to Sudan is subject to 
numerous legal restrictions that result in significant delays in 
providing assistance to the Government of Southern Sudan. Restrictions 
have the most impact on exports of defense articles or services or 
other exports that may require a Presidential waiver and congressional 
notification due to Sudan's designation as a state sponsor of 
terrorism. Providing timely assistance to transform the Sudan People's 
Liberation Army from a guerilla force into a viable army is key to 
developing long-term security in Southern Sudan. Additional authority 
would allow us to provide military and defense assistance to the South 
and the GOSS more readily. The administration has consulted with 
Congress on this matter and will continue to work with Congress to 
ensure that we are able to provide effective assistance to the GOSS.

    Question. The ``Summary and Highlights'' of the Function 150 budget 
issued by the Department indicates that Development Assistance will 
fund programs in stable developing countries that are ``committed to 
promoting economic freedom, ruling justly, and investing in people.''
    (a) These criteria have been used in the Millennium Challenge 
Account. Are they now to be used also with regard to all development 
assistance? Please explain in detail how a country's commitment to 
these criteria will be measured.
    (b) Does this mean that our foreign assistance program dollars will 
not be used to support programs designed for such things as developing 
clean water treatment activities, enhancing girls' education or 
enhancing democracy in countries that are too poor to sufficiently 
``invest in people,'' or that have governments that are not democratic?

    Answer. (a) Development Assistance funds will be used to fulfill 
the objectives of ``ruling justly,'' ``investing in people,'' and 
``encouraging economic freedom.'' A country's commitment to these 
criteria will be measured by the same indicators introduced with the 
Millennium Challenge Account, which will now be applied to all U.S. 
Government assistance. For governing justly and democratically, these 
indicators include: Civil liberties, political rights, voice and 
accountability, government effectiveness, rule of law, and control of 
corruption. For economic growth, these indicators include: Cost of 
starting a business, 1-year consumer price inflation; fiscal policy, 
trade policy, regulatory quality, days to start a business. For 
investing in people, these indicators include: Public expenditures on 
health as a percent of Gross Domestic Product (GDP), immunization rates 
for diphtheria, pertussis, tetanus (DPT3) and measles, public primary 
education spending as a percent of GDP, and girls' primary education 
completion rate.
    (b) Development Assistance (DA) funds will be used to help 
countries, including those with a gross national income per capita of 
less than $3,255, to achieve improvement in country performance, 
measured by the indicators listed above. Focusing DA funds toward 
achieving the objectives of ruling justly, investing in people, and 
enhancing economic freedom does not preclude support for programs such 
as developing clean water treatment activities, enhancing girls' 
education, or enhancing democracy under the new framework.

    Question. What consultations has the Department undertaken with 
private voluntary organizations about your plans for transforming the 
foreign aid structure? If you have not undertaken any, do you plan to 
do so?

    Answer. The Department recognizes the valuable role that private 
voluntary organizations play in implementing U.S. foreign assistance 
funds. Staff from the Office of the Director of Foreign Assistance will 
keep key private voluntary organization representatives abreast of the 
changes that are happening with regard to the foreign aid structure.
    Additionally, the Director of Foreign Assistance, Ambassador 
Randall L. Tobias, will address the organization, InterAction, a 
coalition of more than 160 humanitarian organizations, as the opening 
keynote address at their annual conference on April 10, 2006. During 
this speech he will discuss his vision for the future of foreign 
assistance and take questions and answers from the attendees.
    Ambassador Tobias will also address the Advisory Committee on 
Voluntary Foreign Aid, which includes representatives from 
universities, international nongovernmental organizations, U.S. 
businesses, and government, multilateral, and private organizations. 
During this session, he will lay out the new foreign assistance 
framework and address questions from the participants.

    Question. Section 1206 of the National Defense Authorization Act 
for fiscal year 2006 authorizes the Secretary of Defense to conduct or 
support a program to build the capacity of a foreign country's national 
military forces. You were given a role, by statute, in the process.
    (a) Is it expected that this authority will be exercised in FY 
2006? If so, when?
    (b) Which office or offices of the Department will be involved in 
carrying out your authority under this provision?
    (c) In which countries will this authority be exercised?

    Answer. (a) The Department of State is playing a major role in 
deciding how the section 1206 train-and-equip authority is used. We've 
been working closely with our colleagues in the Department of Defense 
in formulating plans to be exercised in FY 2006. We expect to soon 
forward these proposals to the President for his consideration.
    (b) The Bureau for Political-Military Affairs is the State lead in 
jointly formulating plans to use section 1206 authority. Within State, 
they have worked closely with all of the regional bureaus in developing 
the proposals.
    (c) Our recommendation to the President will include proposals in a 
number of geographic regions. As soon as the President has made his 
decisions, we look forward to briefing Congress on the specifics of the 
approved proposals.

    Question. On September 26, 2005, the President issued Presidential 
Determination No. 2005-38. The determination waived the application of 
section 575 of the FY 2005 Foreign Operations Appropriations Act, ``as 
well as any provision of law that is the same or substantially the same 
as such provision, including subsequently enacted provisions.''

   What is the legal basis for the authority to make a 
        determination made with regard to a future, as yet unenacted, 
        law?

    Answer. Section 575 of the FY 2005 Foreign Operations, Export 
Financing and Relation Programs Appropriations restricts assistance for 
Saudi Arabia. The President exercised the waiver authority provided, 
certifying that Saudi Arabia is cooperating with efforts to combat 
international terrorism and that the proposed assistance will help 
facilitate that effort. Pursuant to this waiver, limited IMET funds 
appropriated in FY 2005, but which were ``no-year'' funds, were 
obligated for Saudi Arabia earlier during this calendar year.
    Although the determination contained the clause referred to, the FY 
2006 FOAA provides an identical restriction and waiver authority, in 
section 582, which is comparable to section 575 of the FY 2005 FOAA. 
The administration has not as yet proposed any FY 2006 funds for Saudi 
Arabia and thus has not had to apply section 582. Were there a desire 
to provide assistance to Saudi Arabia using funds appropriated under 
the FY 2006 FOAA that are restricted by section 582, we would recommend 
that a waiver of section 582 be pursued at such time.

    Question. By the administration's estimates, the President's 
request for Child Survival and Health programs for FY 2007, if enacted, 
would mean a $211 million cut in programs that provide health, 
nutrition, water and sanitation programs, immunizations and assistance 
for children displaced or orphaned by causes other than HIV/AIDS. What 
specific programs and in what countries is the administration 
suggesting cuts for and why have those programs and countries been 
targeted for cuts?

    Answer. The FY 2006 appropriation for the Child Survival and Health 
Programs Fund (post-rescission) is $1,569.150 million and the FY 2007 
request is $1,433.000 million. The FY 2007 request is $136.150 million 
below the FY 2006 enacted level. The primary reduction in funding is 
the Agency's contribution to the Global Fund to Fight AIDS, TB, and 
Malaria. The FY 2006 enacted level for the Global Fund is $247.500 
million and the FY 2007 request is $100 million. The FY 2007 
consolidated USG request for the Global Fund is $300 million; $100 
million each from the Department of State, USAID, and the Department of 
Health and Human Services.

    Question. The administration has requested nearly $1 billion more 
for programs under the Global HIV/AIDS Initiative. All of the increases 
over the fiscal year 2006 projected budget appear, however, to be 
channeled toward the President's Emergency Plan for AIDS Relief 
(PEPFAR), which covers only 15 countries. The administration appears to 
be requesting $25 million less in fiscal year 2007 for non-PEPFAR 
countries than was appropriated for this fiscal year. Does the 
administration project that the HIV-infection rates and/or the number 
of HIV-infected people in all of the nonfocus countries will decline? 
Why isn't the administration asking for an increase in funding to 
combat HIV/AIDS in nonfocus countries?

    Answer. The overall request for PEPFAR funding in fiscal year 2007 
is up dramatically, from approximately $3.2 billion in fiscal year 2006 
to $4 billion. Within this overall increase, priority was placed on the 
focus countries. Without the fiscal year 2007 level of funding for the 
focus countries, it will not be possible to meet the 2-7-10 goals 
established by the President and Congress.
    At the same time, however, the request does include a modest 
increase from the fiscal year 2006 enacted level of funding for 
bilateral programs in other countries (from $425.6 to $432.7 billion, 
not including funding for research). Beyond the focus countries, the 
Emergency Plan targets $5 billion over 5 years to support HIV/AIDS 
programs in an additional 108 countries, international research, 
international partnerships (including the Global Fund), and other 
activities. In fiscal year 2005, PEPFAR directed $293 million to HIV/
AIDS program activities in these 108 nations.
    The President's fiscal year 2007 request for the focus countries 
is, in part, an attempt to recover from the effects on focus country 
programs of the redirection of almost $527 million from focus country 
programs to the Global Fund and to other bilateral programs over the 
Emergency Plan's first 3 years. Of these three broad areas of the 
Emergency Plan, funding for the focus countries, originally planned to 
be $10 billion over 5 years, is the only one which has not been funded 
at the planned level overall to date. Other USG programs, including 
those beyond the focus countries, are on track to meet the $5 billion 
target level over 5 years as originally envisioned for the Emergency 
Plan.

    Question. I am deeply concerned by our budget to support U.N. 
peacekeeping missions. Both this year and in 2007. Assistant Secretary 
Silverberg has spoken about a $500 million shortfall for this year, 
such that we will run out of money to pay our peacekeeping assessments 
this summer.

   How is the Department going to handle this shortfall for the 
        CIPA account in fiscal year 2006?
   The President's funding request for U.N. peacekeeping in 
        fiscal year 2007 is only slightly higher than that for last 
        year, at $1.14 billion. Yet the U.N.'s total budget will 
        increase next year, given the anticipated mission in Darfur. 
        Why is there not a higher request for fiscal year 2007?

    Answer. The shortfall for FY 2005 of $145.010 million and the 
projected shortfall for FY 2006 of $376.752 million totals $521.762 
million. The FY 2006 supplemental budget contains a request of $69.8 
million for the CIPA account for Sudan/Darfur as well as language 
providing transfer authority from the Peacekeeping Operations request 
which, in total, would offset a total of $129.8 million in the above 
total for a net shortfall of $391.962 million at the end of FY 2006.
    We expect that there will be no new shortfalls in FY 2007, i.e., 
that the request will be sufficient to pay FY 2007 assessments. We have 
asked for an increase in FY 2007 funding for Sudan operations in 
anticipation of the United Nations taking over operations in Darfur.

    Question. As you know, a law limiting our payments for U.N. 
peacekeeping to 25 percent has gone back into effect. We are now 
accruing arrears, because we are assessed at a rate of about 27 
percent. I have introduced legislation to remedy this problem (S. 
2095), and the President has proposed similar legislation in his 
budget.

   Do you agree that it is important for the United States to 
        pay its peacekeeping bill in full? Do you support S. 2095?

    Answer. The administration agrees that it is important to pay its 
U.N. peacekeeping assessments in full. We support legislation to enable 
the United States to pay U.N. peacekeeping assessments at the rate used 
by the United Nations.

    Question. As you know, the U.N. Headquarters building is unsafe, 
failing to meet municipal fire and safety codes and drastically in need 
of security upgrades; however, plans to break ground for the new 
building have been delayed and costs are increasing by the day. The 
United Nations has recruited a top-notch person, Fritz Reuter, to work 
on the Capital Master Plan for renovation; however, I understand that 
funding for his office will run out in a few months.

   What is the administration doing to support that a plan for 
        construction be finalized as soon as possible? How are 
        Ambassador Bolton and Department officials in Washington 
        working to garner support among member states for getting this 
        project underway?

    Answer. The United States appreciates and supports the work of the 
Secretariat on the Capital Master Plan (CMP), in particular the efforts 
of Assistant Secretary General Fritz Reuter and the Capital Master Plan 
Office. The United States supports this project, as renovations are 
strongly needed to make the U.N. facilities safe and secure and a 
General Assembly decision on project strategy is, therefore, critical. 
As both the United Nation's largest contributor and host country, the 
United States also has a direct interest in ensuring that the CMP is 
implemented in the most cost-effective and transparent manner possible.
    The General Assembly adopted a resolution on May 8 that provided an 
appropriation of $23.5 million, for the continuation of preconstruction 
activities, and $77 million in commitment authority, to be used to 
begin procurement of a temporary conference building and lease office 
swing space. The United States disassociated from the consensus on this 
resolution. Without a decision on project strategy the administration 
did not believe it would be prudent to agree to the full $100.5 
million, but did endorse the appropriation of $23.5 million to complete 
design work. The administration will work constructively in the next 
resumed session of the General Assembly to resolve remaining issues on 
the CMP, in particular, the critical decision on project strategy.

    Question. You have noted that the President's request includes $75 
million to strengthen the Office of the Coordinator for Reconstruction 
and Stabilization, which will include support for a Conflict Response 
Fund. In addition to the fund, what amount is requested to expand the 
operations of the Office itself? How many additional positions will 
this funding support? How, specifically, will these positions 
contribute to the mission of the Office?

    Answer. In FY 2007, the President's request includes $20.1 million 
in State Operations funding for Reconstruction and Stabilization 
management. This request includes $6.5 million in operating funds and 
$13.6 million in personnel costs ($5.2M for permanent State FTE and 
$8.4M for nonpermanent State FTE) to expand the operations of the 
Office of the Coordinator for Reconstruction and Stabilization
(S/CRS). Currently, S/CRS has 15 permanent positions, approximately 12 
interagency detailees, and 48 nonpermanent positions funded by State 
(15 of which are Active Response Corps). This funding will support an 
additional 15 permanent State Department positions and maintain the 48 
nonpermanent, State-funded positions already in S/CRS.
    The FY07 funding request, and the positions it would create, will 
allow S/CRS to coordinate effective deployments to prevent or transform 
conflict--thereby institutionalizing the Department of State's 
leadership role in planning for and implementing stabilization and 
reconstruction activities. We will build on pilot interagency 
deployments, such as those in Chad, Haiti, and Sudan, and respond to 
developing crises and conflicts by increasing the number of conflict 
assessment teams and sectoral advisors deployed to provide expertise 
and to serve as catalysts for follow-on interagency response. S/CRS 
staff also will focus on refining and testing operational response 
mechanisms, which will allow us to stand ready to deploy interagency 
staff to work with the military at the Geographic Combatant Command and 
field levels in the next crisis.
    The additional funding and staff will allow S/CRS to coordinate 
multiple country responses simultaneously--lending support to State 
regional bureaus and leading interagency planning processes that link 
all USG programs and resources to a comprehensive strategy to address 
conflict prevention and transformation.
    This funding will also allow S/CRS to increase cooperation and 
interoperability with international partners--increasing the total 
international impact of efforts to advance stabilization and 
reconstruction activities.

    Question. A recent inspector general report on the Bureau of 
Diplomatic Security (ISP-I-06-03) indicated that personal escape masks 
issued to overseas posts need to be replaced in the next several fiscal 
years, but that under current budget estimates, ``only a fraction of 
the masks can be replaced each year,'' and that further reduction will 
``decrease the number of posts that receive training'' and other needed 
equipment for employee safety in this area.
    (a) What funds are provided in the baseline plan for FY 2006 and 
the budget for FY 2007 for personal escape masks? How many replacement 
masks will such funds purchase?
    (b) How many personal escape masks are due for replacement in 
fiscal years 2006, 2007, and 2008?
    (c) How many posts will not receive training in the case of escape 
hoods?

    Answer. (a) As of the close of FY 2005, all overseas posts had 
fully equipped and trained First Responder Units, and all overseas 
posts had received a comprehensive chem/bio training package that 
included the provision of escape masks and the associated training. 
Over 110,000 masks were deployed. The FY 2006 plan includes $1.7 
million for replacement of 15,887 masks; the FY 2007 budget includes 
$2.7 million for replacement of 25,233 masks.
    (b) There are 23,400 personal escape masks due for replacement in 
FY 2006 and 36,350 in FY 2007, on the basis of a 4-year replacement 
cycle. To address this shortfall, the Department sent a random sample 
of expiring masks to the U.S. Army's Edgewood Chemical Biological 
Command in Aberdeen, MD, to determine whether the shelf life could be 
extended for a fifth year. If the shelf life can be extended, the 
Department will have sufficient funding to replace all masks on 
schedule by FY 2010. If the shelf life of the masks cannot be extended 
for a fifth year, replacement masks would be supplied to only critical 
and high-threat posts, due to a lack of funding.
    (c) All overseas posts have been initially equipped and trained 
with personal escape masks. New employees will be provided with escape 
mask training upon arrival at post. Refresher training is available for 
employees on an as-needed basis, at the rate of approximately once 
every 2 years for each post.

    Question. The ``National Defense Strategy of the United States of 
America,'' issued by the Department of Defense in March 2005, states as 
a vulnerability of the United States that ``[o]ur strength as a nation 
state will continue to be challenged by those who employ a strategy of 
the weak using international fora, judicial processes, and terrorism.''

   Do you regard engagement in international fora and use of 
        judicial processes as a ``strategy of the weak?''
   Do you regard it as equivalent to terrorism?

    Answer. You are asking for an interpretation of a Department of 
Defense document. I think it would be more appropriate to address this 
question to that Department.
    As for the underlying challenge to the United States being 
described by the phrase that you quote, I understand this to refer not 
to the use of international fora and judicial processes, which is 
undertaken regularly and legitimately by many, but to the ``abuse'' or 
``misuse'' of these fora and processes by some who would seek to 
undermine by any means our national interests and those of our friends 
and allies.

    Question. What role does the Department have in extraordinary 
renditions undertaken by U.S. Government agencies? Please be specific.

    Answer. The term ``extraordinary rendition'' is frequently used to 
refer to a rendition by one state to another state with the knowledge 
or intent that the receiving state will torture the individual being 
rendered. The United States does not engage in such extraordinary 
renditions--as we have repeatedly made clear, including at the U.S. 
Presentation to the Committee Against Torture in May, the United States 
does not transport, and has not transported, detainees from one country 
to another for the purpose of interrogation using torture. The United 
States has not transported anyone, and will not transport anyone, to a 
country if the United States believes he or she will be tortured. Where 
appropriate, the United States seeks assurances it considers to be 
credible that transferred persons will not be tortured.
    To the extent that questions have been raised about the rendition 
of individuals outside of normal extradition procedures, the United 
States has acknowledged that it, like other countries, has long used 
procedures, in addition to extraditions or other judicial procedures, 
to transport individuals from the country where they were captured to 
their home country or to another country where they can be questioned, 
held, or brought to justice. In this regard, after detainees held in 
Guantanamo have been approved for release or transfer to other 
countries, the State Department has played a role in such transfers by 
seeking, where appropriate, diplomatic assurances of humane treatment, 
as well as assurances that the individuals in question will not pose a 
threat to the United States or its allies.

    Question. What has been the involvement of the Department with 
regard to the construction of, maintenance of, or seeking the 
permission for use of, facilities to detain terrorist suspects in 
foreign nations? Please be specific.

    Answer. The Department has the lead role in negotiating the 
transfer of Guantanamo detainees to their country of nationality or a 
third country, when appropriate. For example, the U.S. Government and 
the Government of Afghanistan exchanged diplomatic notes regarding the 
transfer of detainees from the United States to the Government of 
Afghanistan, which committed to accept responsibility for the returning 
Afghan citizens and will work to ensure that they do not pose a 
continuing threat to Afghanistan, the coalition, or the international 
community. The United States is providing assistance to refurbish Block 
IV of the Pol-e Charki prison (PeC), and to train and equip an Afghan 
guard force. Further information in reference to this question has been 
provided in a classified answer.

    Question. It is expected that the administration will send a large 
number of detainees currently in Guantanamo back to their home 
countries, including Afghanistan, where many will continue to be 
detained.
    (a) If detainees are transferred to the custody of the Government 
of Afghanistan, what will be their legal status?
    (b) Do you expect them to be charged with crimes and prosecuted by 
the Government of Afghanistan? If not, under what domestic law will 
Afghanistan detain them and for how long?
    (c) If they are detained without charge, what impact will such 
detention have on efforts to build the rule of law in Afghanistan? Will 
the International Committee for the Red Cross and the Afghan Human 
Rights Commission have access to these detainees.

    Answer. One of the Department of Defense's current missions is to 
use all necessary and appropriate force to defeat the al-Qaeda network 
and its supporters. In the course of that campaign, which remains 
ongoing, the United States and its allies have captured thousands of 
individuals overseas, virtually all of whom are foreign nationals. 
Fewer than 500 of these foreign nationals are being held by the 
Department of Defense (DOD) at the U.S. Naval Base at Guantanamo Bay, 
Cuba (GTMO).
    It is appropriate for DOD to detain these enemy combatants as long 
as hostilities are ongoing. Nonetheless, as former Deputy Assistant 
Secretary of Defense for Detainee Affairs, Matthew Waxman, has 
previously declared, DOD has no interest in detaining enemy combatants 
longer than necessary. Where detention is deemed no longer necessary, a 
detainee may be released to the control of another government. The 
United States also transfers GTMO detainees, under appropriate 
circumstances, to the control of other governments for continued 
detention, investigation, and/or prosecution.
    In all such cases of transfer for continued detention, 
investigation, and/or prosecution, as appropriate, as well as 
situations in which the detainee is transferred for release, the 
detainee is transferred entirely to the custody and control of the 
other government, and once transferred, is no longer in the custody and 
control of the United States. The individual is detained under such 
circumstances, if at all, by the foreign government pursuant to its own 
laws and not on behalf of the United States. With respect to your 
specific questions regarding Afghanistan:
    (a) If GTMO detainees are transferred by the United States to the 
Government of Afghanistan, they will no longer be in the custody and 
control of the United States and thus the Government of Afghanistan 
will determine their status.
    (b) There is not a uniform policy or expectation with respect to 
all Afghan detainees that may be transferred from GTMO to the 
Government of Afghanistan. Furthermore, if an individual transferred is 
detained or prosecuted by the Government of Afghanistan, such action 
would be taken pursuant to the laws of Afghanistan and would not be 
done on behalf of the United States. The Government of Afghanistan is 
currently conducting an assessment of its domestic laws to determine 
its detention and prosecution capabilities and we would not speculate 
as to the domestic legal framework under which the Government of 
Afghanistan might charge or detain an individual detainee.
    (c) We fully expect Afghanistan to detain the transferees in 
accordance with its domestic laws and international obligations, which 
will help build the rule of law in Afghanistan. We additionally 
anticipate that the Government of Afghanistan will allow the 
International Committee for the Red Cross to have access to any 
individuals determined to be enemy combatants, if they are detained. 
However, this is a matter that the ICRC will negotiate directly with 
the Government of Afghanistan.

    Question. It is expected that the administration is planning to 
send a large number of detainees currently in Guantanamo back to their 
home countries, including Saudi Arabia, where many will continue to be 
detained.
    (a) If detainees are transferred back to the custody of the 
Government of Saudi Arabia, what will be their legal status?
    (b) Do you expect them to be charged with crimes and prosecuted by 
the Government of Saudi Arabia? If not, under what domestic law will 
Saudi Arabia detain them and for how long?
    (c) Will the International Committee for the Red Cross have access 
to these detainees?
    (d) Given Saudi Arabia's well-documented record of torture, how 
will the State Department ensure and credibly verify that detainees 
transferred there will not be tortured.

    Answer. (a) Consistent with our discussion in the answer to the 
previous question, if GTMO detainees are transferred by the United 
States to the Kingdom of Saudi Arabia, they will no longer be in the 
custody and control of the United States and thus the Saudi Arabian 
Government will determine the status of any detainees transferred.
    (b) There is not a uniform policy or expectation with respect to 
all Saudi detainees that may be transferred from GTMO to the Kingdom of 
Saudi Arabia. Furthermore, if an individual transfer is detained or 
prosecuted by Saudi Arabia, such action would be taken pursuant to the 
laws of Saudi Arabia and would not be done on behalf of the United 
States. As a result, we cannot speculate as to how long Saudi Arabia 
might or might not detain such individuals.
    (c) As noted with respect to Afghanistan in the answer to the 
previous question, any question of ICRC access to another countries' 
prisons, is a matter for negotiation between the ICRC and that country.
    (d) The United States does not transfer individuals to other 
countries where it believes it is more likely than not that they will 
be tortured. A country's individual human rights record is a factor in, 
rather than a substitute for, a case-by-case analysis, taking into 
account the particular circumstances of the transfer, the country to 
which the transfer is being made, the individual concerned, and any 
concerns regarding torture or persecution that may arise.
    The Department works closely with the Department of Defense and 
relevant agencies with respect to the likelihood of torture or other 
treatment concerns in a given country and the adequacy and credibility 
of assurances obtained from a particular foreign government prior to 
any transfer. In each of these contexts, as appropriate, the United 
States obtains assurances in order to be satisfied that it is not more 
likely than not that the individual in question will be tortured upon 
return. If, taking into account all relevant information, including any 
assurances received, the United States believes that a person more 
likely than not will be tortured if returned to a foreign country, the 
United States would not approve the return of the person to that 
country.
    Finally, with respect to verifying any assurances made, as has been 
stated on numerous occasions, we would take steps to investigate any 
credible allegations of torture and will take appropriate action if 
there is reason to believe that diplomatic assurances obtained are not 
being honored.

    Question. The United States has long condemned governments that 
engage in enforced disappearances--a practice generally defined as 
depriving an individual of his or her freedom and then refusing to 
acknowledge where that person is being detained or even the fact of his 
or her detention.
    (a) Does the State Department agree with this definition of 
``forced disappearances?'' If not, how does the Department define the 
practice?
    (b) Would the long-term detention without charge of a terrorist 
suspect in an undisclosed location to which the International Committee 
for the Red Cross has no access constitute a forced disappearance? If 
not, why not?

    Answer. (a) The definition of an enforced disappearance may vary 
under international law. During the negotiations of the recent United 
Nations Commission on Human Rights Working Group to Elaborate a 
Normative Instrument to Protect All Persons from Enforced 
Disappearance, the United States supported the following definition:

          For purposes of this instrument, enforced disappearance is 
        considered to be the arrest, detention or abduction of a person 
        by or with the authorization, support or acquiescence of the 
        state, followed by a refusal to acknowledge that deprivation of 
        liberty or by concealment of the fate or whereabouts of the 
        disappeared person, with the intention of removing that person 
        from the protection of the law for a prolonged period of time.

    (b) No. As we have repeatedly indicated, we believe that we are in 
a continuing state of armed conflict with al-Qaeda, and that the law of 
war governs the treatment of al-Qaeda combatants captured in the course 
of our military obligations. The interrogation and transfer of captured 
al-Qaeda members is more than an appropriate tool in this fight--it is 
critical to exercising our responsibility to protect our own citizens 
from further attack. U.S. personnel are required to treat all detainees 
consistent with U.S. law and treaty obligations, including prohibitions 
on torture and cruel, inhuman, or degrading treatment, and prohibition 
against transferring persons to be tortured.

    Question. With the passage of the McCain amendment, no detainee in 
U.S. custody anywhere in the world may be subjected to cruel, inhuman, 
or degrading treatment or punishment that is banned by the 1st, 8th, 
and 14th amendments to the Constitution of the United States, which, 
among other things, prohibit the treatment that violates due process or 
``shocks the conscience.'' Some have argued that these constitutional 
prohibitions operate as a sliding scale, with the definition of what 
``shocks the conscience'' shifting based on the governmental interest 
at stake.

   In the State Department's view, are there circumstances 
        where the government's interest in gathering information is so 
        great that, even after passage of the McCain amendment, nothing 
        short of torture would shock the conscience? Or are there 
        certain forms of treatment that would ``shock the conscience'' 
        and constitute cruel, inhuman, and degrading treatment under 
        any circumstance? If it is the former--that under certain 
        circumstances there are no limits on what ``shocks the 
        conscience''--would you be willing to accept a foreign 
        government's reliance on that same argument to justify its 
        treatment of captured U.S. military personnel?

    Answer. The Department of State refers questions regarding the 
application of the McCain amendment to specific interrogation 
techniques to the Department of Defense, which is responsible for 
operational decisions regarding interrogation at the Defense Department 
detention facilities. Questions regarding the scope of the prohibition 
on cruel, inhuman, and degrading treatment found in the 5th, 8th, and 
14th amendment of the United States Constitution are referred to the 
Department of Justice.
                                 ______
                                 

                    Question of Senator George Allen

    Question. In light of Azerbaijan's President Ilham Aliyev's threats 
to resume war and Azerbaijan's significant increase in military 
spending, can the President continue to certify that U.S. military 
assistance will not undermine efforts to negotiate a peaceful 
settlement of the Nagorno-Karabakh conflict?

    Answer. Yes. U.S. security assistance to Azerbaijan is carefully 
targeted so as not to undermine or hamper ongoing efforts to negotiate 
a peaceful settlement between Armenia and Azerbaijan, or to be used for 
offensive purposes against Armenia, as per Public Law 107-115. The 
United States assists Azerbaijan by upgrading its capability to combat 
terrorism, to operate with U.S. and NATO forces, and to protect its 
borders against the trafficking of weapons of mass destruction, illicit 
narcotics, and other items that threaten international stability and 
U.S. national security.
    The projected increased military spending of 76 percent in 
Azerbaijan in 2006 is proportionate to the budget increase, due to 
dramatically increased oil revenues. The increase in military spending 
may also be driven by fear of, and increasing political pressure from, 
its powerful neighbors, Iran and Russia.
    The President and Foreign Minister of Azerbaijan have participated 
actively in a series of meetings led by the OSCE Minsk Group (the 
``Prague Process'') since 2004, aimed at finding a peaceful settlement 
to the Nagorno-Karabakh conflict. Despite the stall in negotiations 
that resulted after talks at Rambouillet, France, in February 2006, we 
continue to believe that 2006 offers a realistic window of opportunity 
to achieve a peaceful settlement to the conflict. We support the 
territorial integrity of Azerbaijan and hold that the future status of 
Nagorno-Karabakh is a matter of negotiation between the parties.
    We are providing Azerbaijan with a level of military assistance 
consistent with its crucial participation and cooperation in the war on 
terror. The Government of Azerbaijan has made invaluable contributions 
to the war on terror, including, but not limited to, blanket overflight 
rights, the use of Azerbaijan military bases, information-sharing, and 
law enforcement cooperation. Azerbaijan's cooperation with the United 
States Government has allowed us to achieve several significant 
successes in disrupting terrorist cells and in bringing terrorists to 
justice.
                                 ______
                                 

                   Questions of Senator Barbara Boxer

    Question. What is our strategy to make sure that this area (``the 
lawless Pashtun tribal areas'') of Pakistan does not remain an area of 
sanctuary for the Taliban and al-Qaeda?

    Answer. To support Pakistan's efforts to exercise stronger control 
in the tribal areas, we are providing assistance for border security 
and socioeconomic development. Along the Pakistan-Afghanistan border, 
we are supporting the building of roads and outposts that allow for 
more effective control of the border. We are also supporting 
construction of new schools, teacher training, microfinance programs, 
health activities to improve child health services and installation of 
small-scale infrastructure projects such as dug wells and 
minihydroelectric schemes to secure community support for Pakistan's 
Government.
    Our mutual aim is to enhance central government authority in the 
tribal areas to ensure that the region will never again be a sanctuary 
for terrorists and militants.
    We also participate with both Pakistan and Afghanistan in the 
Tripartite Commission, a military forum that meets regularly on cross-
border military and security cooperation. Through the commission we 
work with both Pakistan and Afghanistan to bring improved field 
coordination and communication for security operations in this region.

    Question. Will the U.S. support efforts to pass a binding Security 
Council resolution calling for constructive action on Burma?

    Answer. The United States remains gravely concerned about the 
deteriorating situation in Burma. We believe the Security Council has 
an important role to play in promoting positive change there, and we 
are actively exploring ways to build UNSC consensus on the need for 
further discussions and possible action on Burma in follow-up to the 
landmark Council discussion on December 16.
    We are also advocating discussion of Burma in other U.N. bodies, 
such as the Economic and Social Council (ECOSOC) and the Third 
Committee. Last year, the United States cosponsored the European 
Union's annual Burma human rights resolution at the United Nations 
General Assembly's Third Committee, which called for ``a genuinely 
inclusive'' political process through the ``unhindered participation of 
all political parties and representatives of ethnic nationalities,'' as 
well as the immediate and unconditional release of political prisoners. 
Separately, we are supporting the International Labor Organization's 
request to place Burma on the 2006 ECOSOC agenda.
    We will continue to encourage U.N. Secretary General Kofi Annan to 
remain engaged in Burma, and to work with the U.N. Secretariat to 
identify the best possible successor for the Secretary General's former 
Special Envoy to Burma, Razali Ismail.

    Question. Secretary Rice, 60 Minutes recently ran a piece on the 
widespread waste, fraud, and abuse that has plagued the Iraq 
reconstruction effort. Highlighted in the piece was a contractor, 
Custer Battles, that was given tens of millions of dollars in contracts 
despite having no experience and no qualifications. Despite failing 
miserably in every job it was asked to do, the Coalition Provisional 
Authority not only refused to fire Custer Battles, it wrote a glowing 
review and continued to give them contracts.
    Secretary Rice, you were placed in charge of coordinating Iraq's 
reconstruction in October 2003. What involvement, if any, did you have 
with this particular case?

    Answer. In October 2003, the National Security Council created an 
Iraq Stabilization Group with four interagency cells, including one on 
economics, in order to strengthen interagency policy support for the 
Department of Defense and the Coalition Provisional Authority and to 
help prepare for the next phase of the reconstruction effort in Iraq. 
This interagency group had no direct involvement in reviewing 
contracts. The Custer Battles case is now before the Federal district 
court in Virginia, and it would be inappropriate to comment on pending 
litigation.
    On May 11, 2004, the President issued a National Security 
Presidential Directive in which he determined that the Secretary of 
State would be responsible for the continuous supervision and general 
direction of all assistance for Iraq. To that end, the Department of 
State cooperates closely with the Office of the Inspector General 
(OIG), the General Accounting Office (GAO), and the Special Inspector 
General for Iraq Reconstruction (SIGIR), each of which actively audits 
U.S. programs in Iraq.
                                 ______
                                 

                Questions of Senator Russell D. Feingold

    Question. Does the proposed increase in this budget request for the 
current U.N. mission in Sudan take into account the likelihood that the 
African Union mission in Sudan may be replaced by a new U.N. 
peacekeeping Mission later this year?

    Answer. Yes, the $442 million Contributions to International 
Peacekeeping Account (CIPA) request includes $160 million for a U.N. 
peacekeeping operation in Darfur based on the likelihood that the 
African Union Mission in Sudan (AMIS) will transition to a U.N. 
operation this year. Though the U.N. Security Council has not yet 
adopted a resolution authorizing that transition, we expect one within 
the March timeframe to kick off the ``re-hat'' of AMIS, and a U.N. 
operation in Darfur would become fully operational between end-
September and end-December 2006. We are pressing for this transition to 
take place as soon as possible to improve security and humanitarian 
access in Darfur. The $442 million FY 2007 CIPA request also includes 
$282 million to sustain the current U.N. peacekeeping operation in 
Southern Sudan (UNMIS).

    Question. Has the State Department begun planning for the possible 
role of NATO or a new U.N. peacekeeping mission in Darfur?

    Answer. The Department is working with the United Nations, 
bilateral partners, and the African Union to expedite a formal African 
Union (AU) request for a U.N. re-hat of the African Union Mission in 
Sudan (AMIS) and to obtain a U.N. Security Council Resolution 
authorizing that transition shortly thereafter. In the interim before 
adoption of that resolution, we are working with the U.N. Department of 
Peacekeeping Operations (DPKO) to advance the planning process 
authorized by our February 3 UNSC Presidential Statement, which 
directed DPKO to cooperate with the UNSC members, the AU, and the 
parties to the Darfur conflict to begin planning for a future U.N. 
peacekeeping operation in Darfur. We have provided DPKO with four U.S. 
military planners from the joint staff and will continue working with 
DPKO and the Secretary General's office to expedite the planning 
process.
    We are also exploring new ways to increase AMIS capacity in the 
interim. AMIS needs additional expertise and, as the President has 
said, we believe NATO can do more. NATO has already trained over 120 
AMIS Force Headquarters staff and has taken the lead in providing 
strategic airlift for thousands of newly deployed or rotating AMIS 
troops. We are working closely with European allies to determine how 
NATO, in coordination with the EU, can provide more support and are 
optimistic that, with a request for assistance from the United Nations 
or African Union, NATO will be able to do more.

    Question. What is the administration's strategic plan for Sudan and 
how is it linked to its budget request? Is your budget request 
sufficient to cover our strategy in Sudan for the coming year?

    Answer. The overarching U.S. policy goal is to achieve a peaceful 
and democratic transformation that assures broad participation in the 
political process and fosters civil liberties and to promote a just, 
viable political settlement to the conflicts in a united Sudan. Our 
strategy to achieve this is multifaceted. One facet is a stable 
Southern Sudan; demilitarized, at peace with its northern neighbors, 
and on the path toward long-term reconstruction with immediate 
humanitarian needs met. Another is to help bring an end to the conflict 
in Darfur and facilitate the return of internally displaced persons and 
refugees to their homes. The reconstruction of Southern Sudan is a 
major subgoal of the United States strategy for rebuilding and 
stabilizing Sudan. However, because events in Southern Sudan are 
closely connected and affected by events in other parts of the country, 
including Darfur, Eastern Sudan, and the North, the USG must take an 
integrated approach. The USG assistance to Sudan is divided into three 
categories:

   Humanitarian Assistance: Meeting basic humanitarian needs--
        food, shelter, and health services--of vulnerable and returning 
        populations affected by conflict will reduce the threats to 
        stability and thus strengthen the successful implementation of 
        the Comprehensive Peace Agreement.
   Transitional Security: Elements that contribute to 
        transitional security include such activities as peacekeeping 
        in Darfur; transformation of the SPLA into a professional army; 
        assistance to strengthen the rule of law and to mitigate 
        conflict in the south; and support to the U.N. Mission in Sudan 
        (UNMIS). We also believe a more robust peacekeeping effort is 
        needed in Darfur and for that reason support a U.N. re-hat of 
        the African Mission in Sudan (AMIS), but one that would 
        incorporate elements of AMIS. In a transition to a U.N. 
        peacekeeping force we would concurrently support and strengthen 
        AMIS during the transition period.
   Reconstruction of Governance, the Economy and Social 
        Services: Strategic investments for the south to provide 
        essential services in communities that will be receiving 
        returnees; to mitigate local conflict over scarce resources; to 
        rehabilitate infrastructure for the promotion of markets and 
        freedom of movement; to promote immediate agricultural and 
        enterprise opportunities; and to support the creation of a 
        participatory and responsive government structure and system.

    The Department of State's FY07 budget request is specifically keyed 
to funding these categories and objectives. We believe our FY07 
request, when coupled with the FY06 supplemental request, is sufficient 
to implement our Sudan strategy as outlined.

    Question. Given that Somalia is a failed state, a breeding ground 
for terrorist organizations, including al-Qaeda, and a convenient base 
for pirates and criminal networks that are roaming around the region 
unhindered, why is the funding request for Somalia so low?

    Answer. The formation of a transitional governing entity known as 
the Somalia Transitional Federal Institutions (TFIs) provides an 
opportunity for increased U.S. engagement in FY 2007; however, 
Somalia's continued instability, lack of security, and low absorptive 
capacity hampers extensive U.S. direct bilateral assistance programming 
in many sectors in Somalia.
    For example, in FY 2005, the U.S. Embassy in Nairobi, Kenya, was 
forced to suspend the award of additional Democracy and Human Rights 
Funds (DHRF) due to the inability to gain access to Somali territory to 
maintain appropriate project monitoring and financial controls. In 
addition, existing legislation prevents direct assistance to a Somali 
Government due to Somalia's significant arrears to the United States 
and further complicates our ability to program U.S. assistance in 
Somalia.
    Despite these restrictions, we continue to program limited levels 
of U.S. foreign assistance in Somalia in the areas of governance, 
conflict resolution, and support for civil society. As a result, U.S. 
assistance programs in Somalia are currently supporting peacebuilding 
efforts by Somali civil society organizations in an effort make the 
region less vulnerable to terrorist organizations seeking a safe haven. 
In addition, U.S. humanitarian assistance will address the humanitarian 
needs of the Somali people. In FY 2006, increased Public Law 480, title 
II assistance will address the humanitarian needs of approximately 1.7 
million people currently at risk of starvation in southern Somalia. 
Vulnerable populations in Somalia, particularly in the regions of 
Puntland and Somaliland, will also receive humanitarian assistance 
through U.S. contributions to the Africa programs of the International 
Committee of the Red Cross and the United Nations High Commissioner for 
Refugees. We will continue to review opportunities for additional U.S. 
assistance activities and programs in Somalia as the ongoing political 
process develops.

    Question. Does the administration have a comprehensive strategy to 
promote peace and democratic governance in Somalia? Is the Office of 
Reconstruction and Stabilization involved in assisting with the 
development of such a plan?

    Answer. The administration's strategy to promote peace and 
democracy in Somalia will build upon earlier successes in the 
reconciliation process and work with our regional and international 
partners to support the reestablishment of stability and effective 
governance in Somalia. U.S. policy toward Somalia is designed to 
support the reestablishment of a functioning central government in 
Somalia capable of bringing the Somali people out of this long period 
of civil conflict and addressing the humanitarian needs of the Somali 
people and the international community's concerns regarding terrorism. 
In order to achieve these policy objectives, we will coordinate our 
engagement with our international, regional, and donor partners to 
support positive developments in Somalia. The administration's strategy 
reflects guidelines provided by the Office of Reconstruction and 
Stabilization.
    We are currently in the process of seeking and identifying the 
additional personnel and budget resources needed to implement this 
engagement strategy and achieve U.S. policy objectives in Somalia. Our 
ability to engage effectively with a nascent Somali Government and 
governing institutions, however, will be driven by events inside 
Somalia and the progress made by various members of the Somalia 
Transitional Federal Institutions. In this regard, we have closely 
followed the recent convening of the first session of the Somalia 
Transitional Federal Parliament in Baidoa. Through the U.S. Embassy in 
Nairobi, Kenya, we continue to urge all members of the Transitional 
Federal Institutions to resolve their differences peacefully within the 
framework of the Transitional Federal Charter.

    Question. Is the United States coordinating with other donor 
countries and international organizations to maximize international 
assistance? What mechanisms or bodies exist to do this?

    Answer. U.S. assistance to Somalia is coordinated through the 
Somalia Aid Co-ordination Body (SACB) that was established in December 
1993 and consists of a variety of policy and sectoral committees in an 
effort to improve the impact of the international community's 
assistance to Somalia. The SACB is a voluntary coordination mechanism 
that provides a framework for developing coordinated approaches for 
donor engagement in Somalia. A range of donors, including the United 
States, has provided consistent support for SACB activities.
    In addition, during a donor coordination conference in October 
2004, the international community agreed that the United Nations should 
lead coordination and cooperation of the international community with 
respect to Somalia and with the Transitional Federal Institutions 
(TFIs). A Declaration of Principles was approved, establishing a 
Coordination and Monitoring Committee (CMC). This framework created the 
highest level mechanism for coordination between the TFIs and the 
international community. The CMC is cochaired by the Prime Minister of 
the Transitional Federal Government and the Special Representative of 
the United Nations Secretary General (UNSRSG). The UNSRSG also chairs a 
weekly meeting that brings together the international community on an 
informal basis to discuss political developments. Voluntary U.S. 
contributions to a variety of United Nations agencies, including the 
U.N. Development Programme (UNDP), World Food Programme (WFP), and U.N. 
Children's Fund (UNICEF), also support multilateral donor engagement in 
Somalia.
    Although sharp divisions within the TFIs have prevented the CMC 
from functioning since April 2005, we continue to work with our donor 
partners and regional actors to develop and consolidate a common 
position to advance the reconciliation process in Somalia. There is a 
separate monthly donor coordination meeting in Nairobi chaired by a 
Troika of Denmark, Norway, and Sweden. Representatives from USAID and 
State participate to the extent possible in the numerous coordination 
meetings in Nairobi.

    Question. Was the administration monitoring the detainees linked to 
al-Qaeda who recently escaped from prison in Yemen prior to their 
escape?

    Answer. All 23 prisoners were held at a maximum security facility 
run by the Political Security Organization (PSO). The Yemeni Government 
specifically designated this prison for terrorism-related offenders. 
U.S. Embassy officials were occasionally granted access to certain 
prisoners based on written requests.

    Question. What actions did the administration take to try to 
prevent a repeat of the detainee escape that took place in 2003?

    Answer. The two detainees who escaped from prison in the southern 
city of Aden in 2003 were placed, after recapture, in the Sanaa 
Political Security Organization prison where prison security was 
considered tighter.

    Question. What assurances, commitments, and cooperation has the 
United States received from the Yemeni Government with respect to 
prosecuting those responsible for the attack on the USS Cole?

    Answer. In July 2004, the surviving terrorists involved in the 
attack on the USS Cole were brought to trial as a result of 
collaborative investigations by the Yemeni authorities and the FBI. The 
trials were held with a USG representative present. The Attorney 
General maintained regular contact with the Embassy throughout the 
process. In September 2004, a Yemeni court convicted the six terrorists 
charged with planning and perpetrating the attack on the USS Cole.

    Question. Does the current budget request reflect any changes to 
our assistance to Yemen needed to address the prison break and any 
forthcoming changes to the United States-Yemen relationship?

    Answer. Currently there are no direct funding requests for 
additional resources in the aftermath of the escape.

    Question. Were you satisfied with our relationship with Yemen 
before the escape?

    Answer. Since the post 9/11 forging of United States-Yemen 
counterterrorism partnership, the Yemeni Government has significantly 
improved the security situation in Yemen and denied Yemen as a haven 
for al-Qaeda. United States-Yemen counterterrorism cooperation prior to 
the January 2006 prison escape was positive, although Yemen's limited 
capabilities often posed challenges.
    High-level engagement--e.g., visits to Yemen by Assistant to the 
President for Homeland Security and Counterterrorism, Frances F. 
Townsend, and President Saleh's November 2005 visit to Washington--
yielded successes and also highlighted difficulties. For example, we 
remained unsatisfied with Yemen's response to our requests to close 
down the private sector arms trade, install a modern inventory system 
to better account for military hardware, and improve information-
sharing on the interrogation of terror suspects. The U.S. Embassy in 
Sanaa remains focused on these and other challenges as we continue to 
the effort to sustain effective counterterrorism cooperation with 
Yemen.

    Question. What role has this new office played in developing a 
strategy for addressing stabilization and reconstruction efforts in 
Sudan? How many people within this new office are dedicated to Sudan-
related work?

    Answer. Deputy Secretary Zoellick asked S/CRS to assist the Bureau 
of African Affairs (AF) in preparing an interagency conflict 
transformation plan, with a focus on planning for implementation of the 
Comprehensive Peace Agreement (CPA) and ongoing efforts to resolve the 
crisis in Darfur.
    S/CRS facilitated meetings of the interagency to further develop 
and refine the strategic goals and essential tasks of this plan. 
Metrics were identified to measure progress to meet these goals. This 
process also provided a forum to synchronize crosscutting efforts.
    At the request of OMB, S/CRS also assisted the interagency in 
facilitating a review of the interagency Sudan budget requests to 
identify potential resource gaps. This analysis helped decisionmakers 
formulate the FY06 supplemental and the FY07 budget request.
    At the peak of the planning effort in the fall of 2005, S/CRS 
dedicated four staff full time to work on Sudan, with three others 
working half time or more. S/CRS funded a core Secretariat of 3 
personnel, located in the Africa bureau at State, to improve 
information flow among the interagency, develop robust performance 
measures for the plan, and provide geospatial analysis to the 
reporting. Five S/CRS staff continue to work part time on Sudan-related 
issues. S/CRS is providing a security expert to assist in the Abuja 
talks, and has funded three positions at the Embassy in Khartoum to 
assist in documenting USG-wide conflict transformation planning and 
implementation by all USG agencies.

    Question. Does the Africa bureau work closely with this new office?

    Answer. S/CRS and the Bureau of African Affairs (AF) work 
collegially and cooperatively on a range of issues. On Sudan, we worked 
closely on the conflict transformation planning process, an interagency 
process to develop an overall USG strategy, including resource 
requirements, for achieving democratic transformation and an end to 
conflict.
    AF and S/CRS regularly dialogue on strategies to address potential 
conflict in countries on the continent. Last year we jointly sponsored 
a roundtable and simulation on the Democratic Republic of the Congo, 
which generated some new ideas for the upcoming elections. More 
recently, S/CRS has cooperated closely with AF on Chad by fielding a 
team to assess underlying causes of conflict and to assist Embassy 
N'Djamena and AF with conflict prevention planning.

    Question. Is this new office part of discussions concerning the 
deployment of additional peacekeepers to Darfur?

    Answer. The Bureau of African Affairs (AF), in conjunction with the 
Bureau of International Organizations (IO), has the lead in supporting 
the African Union Mission in Sudan (AMIS) and working to transition it 
to a U.N. peacekeeping operation. S/CRS has focused its efforts on 
developing an overall strategic framework for post-conflict 
reconstruction and democratic transformation in Sudan.

    Question. Does the budget request provide adequate resources for 
its continued or increased effectiveness? What is its operational 
budget request for FY 2007?

    Answer.

   The FY 2007 funding request for State Operations will 
        provide for 15 additional personnel on a permanent basis for S/
        CRS. Because current staffing is largely dependent on temporary 
        detail arrangements, the additional resources in FY07 would 
        allow us to regularize some of our current staffing and 
        institutionalize our efforts.
   Current levels of staffing and operations funding allow S/
        CRS to provide per year:

     Leadership and management of three major country response 
            efforts with regional bureau, including management of 
            planning process;
     Support to conflict prevention efforts in three countries;
     Leadership of civilian participation in two major military 
            exercises that test military and civilian planning and 
            deployment for R&S operations.

   Each such country engagement effort includes participation 
        of numerous staff from other bureaus, departments, and 
        agencies.

Attachments

                        STATE PERSONNEL FOR S/CRS
------------------------------------------------------------------------
                Plan                     2005        2006        2007
------------------------------------------------------------------------
S/CRS and Active Response Corps*
    Cumulative FTE..................           9          15          30
    Cumulative Temporary Positions**          22          48          48
                                     -----------------------------------
      Total Perm & Temp.............          31          63          78
------------------------------------------------------------------------
* S/CRS staff supplemented by contractors and other short-term hires, as
  well as interagency detailees.
** Additional temporary State positions, not counting contractors or
  interns.



                         [Dollars in thousands]
------------------------------------------------------------------------
                                                    FY06         FY07
             Account               FY05 actual    estimate     request
------------------------------------------------------------------------
FY05 Supplemental Operating             $7,700  ...........  ...........
 Funds*..........................
Bureau-Managed Operating Funds...       **$737       $6,237       $6,507
Cost of Permanent Positions             $1,485       $2,475       $5,250
 Funded..........................
    (total FTE)..................          (9)         (15)         (30)
Cost of other State nonpermanent        $2,950       $7,920       $8,400
 staff...........................
    (total positions; includes            (22)         (48)         (48)
     Active Response Corps)......
                                  --------------------------------------
      S/CRS Total (State               $12,872      $16,632      $20,157
       Operations--D&CP).........
Conflict Response Fund (Foreign              0            0       75,000
 Ops)............................
------------------------------------------------------------------------
* Supplemental provided 2-year funding; $2.6M obligated in FY05 and
  $5.1M in FY06.


    Question. How will the new Director of Foreign Assistance relate to 
NSPD-44 and the role of S/CRS?

    Answer. S/CRS was created to better organize our government to 
address the full spectrum of conflict--from prevention to response. Our 
operating assumption has been that S/CRS would manage to 2-3 post-
conflict reconstruction and stabilization efforts at one time.
    We anticipate that S/CRS will be activated when the United States 
engages in an effort that requires strategic planning, coordination, 
and interoperability among multiple USG agencies in the use of foreign 
assistance as well as in military, diplomatic, and other areas. S/CRS 
is also charged with international coordination for S&R operations, 
with creating a joint operations capability for managing a response, 
and with developing deployable civilian capacity. The Presidential 
Directive on reconstruction and stabilization, issued in December, 
reinforces this mandate.
    The Director of Foreign Assistance will manage the range of foreign 
assistance, which includes about $19 billion in aid provided to 80 
countries. This role is complementary to the efforts in S/CRS and in 
other parts of our Government to focus on effective U.S. engagement.
    States are most at risk of failure in a transition from conflict 
because their institutions are weak, and they are often reliant on 
international assistance, which can at times be slower in arriving than 
needed. In a crisis, speed is key. We have to be able to quickly assess 
our resources, define goals and objectives, identify needs, and 
allocate available resources as quickly and effectively as possible in 
anticipating, planning, and responding.
    By establishing a central node to oversee foreign assistance more 
broadly, and look across the entire pool of resources, we see an 
opportunity to further improve our capabilities to manage strategies 
for country assistance programs. The new structure will provide S/CRS 
with a valuable partner in our efforts to manage post-conflict 
response.

    Question. What relationship will the Director of Foreign Assistance 
have with the Assistant Secretaries and Coordinators at the State 
Department and Assistant Administrators at USAID who currently have 
responsibility for designing and implementing foreign assistance 
programs?

    Answer. I am establishing the position of Director of Foreign 
Assistance (DFA) to align better our foreign assistance programs with 
our foreign policy goals, to align more fully the foreign assistance 
activities of USAID and State, and to demonstrate that we are 
responsible stewards of taxpayer dollars. I am investing the DFA with 
authority over foreign assistance funding and programs to achieve these 
goals, not to supervise Assistant Secretaries and Coordinators or 
Assistant Administrators. Nor are the reporting relationships of 
Assistant Secretaries or Assistant Administrators expected to change. 
Instead, the Director of Foreign Assistance will work closely with 
Assistant Secretaries and Assistant Administrators in exercising his 
authority over foreign assistance funding and programs and developing 
coordinated strategies, plans, and budgets.

    Question. Who will control the funds that are currently apportioned 
to those individuals and how will the decisionmaking process work?

    Answer. To the extent permitted by law, I will delegate to the 
Director of Foreign Assistance the foreign assistance funding 
authorities consistent with and necessary to achieve a single 
coordinated foreign assistance approval authority. Under my direction, 
the DFA will have approval and coordinating authority over all foreign 
assistance.

    Question. How has the Department of State planned for managing a 
wide-scale outbreak of avian influenza in Africa, and has your office 
developed contingency plans to address the diplomatic, economic, and 
security concerns that an outbreak of avian influenza may have in each 
major region of the continent?

    Answer. The H5N1 highly pathogenic avian influenza (HPAI) virus has 
spread to Africa, with the virus detected in Nigeria, Egypt, and Niger. 
We are particularly concerned about the potential for spread of the 
H5N1 virus in Africa, given the relatively weak health and preparedness 
infrastructure in many African countries and the continent's high 
incidence of immunocompromised people. Further, the H5N1 virus is not 
just a health matter but an economic, security, and social issue. 
Outbreaks in birds cause economic hardships and may threaten food 
security in some regions. The social, economic, and political impacts 
of a virulent human flu pandemic, whether sparked by the strain that is 
currently circulating in birds or by any other new strain, could be 
devastating.
    Our framework for action in Africa is predicated on measures in 
support of surveillance, preparedness, response, and containment.
    The State Department has established an interagency African Avian 
Influenza Network that was activated to respond to avian influenza 
outbreaks in Africa, starting with Nigeria. U.S. Ambassadors are 
instructed to encourage host governments to promote strong interagency 
communication and coordination (particularly among Ministries of 
Agriculture, Health and Information) to combat the threat of avian 
influenza. As in the case of Nigeria, U.S. Embassies are encouraged to 
work closely with other donors and U.N. resident representatives to 
prioritize host country needs and coordinate appropriate international 
responses. Our Embassies are instructed to convey to host governments 
the importance of coordinating their efforts with neighboring 
countries, and U.S. Embassies in neighboring countries also coordinate 
closely among themselves. Regional organizations such as the Economic 
Community of West African States (ECOWAS) have been engaged to develop 
regional response strategies and resources, as outbreaks become more 
widespread.
    Within the African Avian Influenza Network, the State Department's 
Avian Influenza Action Group and the Bureau of African Affairs are 
coordinating closely with the U.S. Agency for International Development 
(USAID), the U.S. Department of Agriculture (USDA), the Department of 
Health and Human Services (HHS), the Department of Defense (DOD) and 
other appropriate agencies, both in Washington and in affected and 
high-risk countries, to develop assistance programs and technical 
support for countries potentially affected by outbreaks. Both the 
interagency African Avian Influenza Network in Washington and the 
country teams at U.S. Embassies and consulates overseas are developing 
appropriate contingency plans for addressing the anticipated 
diplomatic, economic, and security concerns of countries affected by 
avian influenza in Africa. Our plans are coordinated with appropriate 
international technical organizations including the World Health 
Organization (WHO), the Food and Agriculture Organization (FAO), the 
World Organization for Animal Health (OIE) and the United Nations 
Educational, Scientific and Cultural Organization (UNESCO).

    Question. Do you believe the budget request includes enough support 
for regional organizations and countries that need to strengthen their 
capabilities to respond to such an outbreak in the coming year?

    Answer. At the present time, we believe that $214 million in FY 
2007 funds, in addition to $280 million in FY 2006 supplemental 
appropriations will be adequate to help support regional organizations 
and countries that need to strengthen their capabilities to respond to 
such an outbreak in the coming year and to help contain an influenza 
outbreak beyond the borders of the United States. The adequacy of U.S. 
support must take into account the totality of contributions of the 
international community, including financial and other support provided 
by multilateral, bilateral, and private sector donors. The reality of 
the threat of pandemic influenza is that it is too large for any one 
country to address alone, and requires a comprehensive and coordinated 
response from the international community. It is also important to 
realize that building the capacity of many of these nations to 
adequately respond will require time as well as funding (conducting 
training, building laboratories, developing and establishing policies, 
etc.) and some tasks may require more than a year to complete.

    Question. Please provide a description of the new DOD-State 
transition planning group for Iraq and Afghanistan led by GEN (Ret.) 
Kicklighter.

   Given how complex our stabilization and reconstruction 
        operations in Iraq have been, will this new planning effort for 
        two countries dilute the quality of its work?
   What are the primary products or processes GEN Kicklighter 
        will deliver?
   Why wasn't this new effort set up until last October or 
        November?

    Answer. The Iraq-Afghanistan Joint Transition Planning Group is a 
joint Department of State and Department of Defense team that has been 
asked by both Secretaries to review U.S. Government efforts to address 
medium- and long-range transition challenges in Iraq and Afghanistan. 
Recognizing the complexity of the issues and the number of interested 
agencies, the group has been asked to focus the scope of their 
assessment primarily on security-related transition challenges.
    Currently, the group is collecting data and engaging in initial 
analysis exercises; the final product is still being contemplated.
    Through the end of 2005, a major focus of the Iraq and Afghanistan 
campaign plans was the training and equipping of the security forces. 
This remains a priority but as the respective security forces start to 
command increasing responsibility, the time has come to consider and 
prepare for security-related transitions in the medium- and long-range 
timeframe.

    Question. Would the U.S. Government render a suspect to a country 
that is known to practice torture, as long as that government assured 
the United States that it would not torture that particular suspect? 
What form would that assurance take?

    Answer. The United States does not transfer individuals to other 
countries where it believes it is more likely than not that they will 
be tortured. Decisions with respect to transfers are analyzed on a 
case-by-case basis, taking into account the particular circumstances of 
the transfer, the country to which the transfer is being made, the 
individual concerned, and any concerns regarding torture or persecution 
that may arise.
    In the immigration removal and extradition contexts, the United 
States reserves the use of assurances for a very small number of cases 
where it can reasonably rely on such assurances that the individuals 
being transferred would not be tortured.
    In the context of decisions relating to the transfer or 
repatriation of individuals detained by the U.S. Armed Forces at the 
U.S. Naval Base in Guantanamo Bay, Cuba, the Department works closely 
with the Department of Defense and relevant agencies to advise on the 
likelihood of torture or other treatment concerns in a given country 
and the adequacy and credibility of assurances obtained from a 
particular foreign government prior to any transfer. In each of these 
contexts, as appropriate, the United States obtains assurances in order 
to be satisfied that it is not more likely than not that the individual 
in question will be tortured upon return. If, taking into account all 
relevant information, including any assurances received, the United 
States believes that a person more likely than not will be tortured if 
returned to a foreign country, the United States would not approve the 
return of the person to that country. Finally, in answer to your 
question regarding form, these assurances, when obtained, are 
frequently transmitted through diplomatic notes.

    Question. Do you seek similar assurances that individuals will not 
be subject to cruel, inhuman, or degrading treatment?

    Answer. As a general matter it should be noted that article 3 of 
the Convention Against Torture and Other Cruel, Inhuman or Degrading 
Treatment or Punishment provides that ``[n]o State Party shall expel, 
return (`refouler') or extradite a person to another State where there 
are substantial grounds for believing that he would be in danger of 
being subjected to torture.'' By its terms, this provision applies to 
torture and not to cruel, inhuman, or degrading treatment or 
punishment. That said, it should be noted that in some contexts the 
Department of State seeks more specific assurances, as appropriate. For 
example, if the receiving State in question is not a party to certain 
relevant treaties, such as the Convention Against Torture, the 
Department may pursue more specific assurances, which, for example, 
assure that an individual will not be subject to cruel, inhuman, or 
degrading treatment.

    Question. As you know, the European Parliament is currently 
investigating whether the CIA or other U.S. Agencies or other countries 
carried out abductions, extraordinary rendition, detention at secret 
sites, and torture of prisoners in EU countries or have used EU 
countries to transfer prisoners. Would you support a similar inquiry by 
the U.S. Congress into these matters?

    Answer. No, I would not. As this administration has repeatedly 
stated, and as I made clear on my trip to Europe in early December, the 
United States does not condone torture. Nor does it transport detainees 
from one country to another for the purpose of being tortured. 
Moreover, our policy has been clear that the United States does not 
authorize interrogations that involve cruel, inhuman, or degrading 
treatment, as defined by U.S. obligations under the Torture Convention, 
regardless of where those interrogations occur. The Detainee Treatment 
Act codified this policy into law.
                                 ______
                                 

                   Questions of Senator Mel Martinez

              WESTERN HEMISPHERE ACCOUNTS: USAID PROGRAMS

    Question. The biggest regional funding setbacks appear to be in the 
two key USAID Bilateral Economic Assistance programs: Child Survival/
Health and Development Assistance, which suffered a combined decrease 
from last year's actual funding of more than $85 million. Even counting 
the significant $31 million boost that State Economic Support Fund 
(ESF) and the $22 million increase in funding for HIV/AIDS in Haiti and 
Guyana, the net regional decrease (more than $32 million) is troubling.
    Why were these decreases to USAID programs necessary? Some of that 
decrease may be the result of some countries naturally ``graduating'' 
or ramping off of certain child care programs (e.g., El Salvador, 
Haiti, Honduras, Nicaragua, Bolivia, Peru), but it seems that even that 
money should be reinvested in the region. Did you consider shifting it 
to other countries in the region?

    Answer. While the FY 2007 request for Development Assistance 
funding has been reduced from $254 million to $182 million (28% 
reduction) and Child Survival and Health (CSH) funding has declined 
from $141 million to $128 million (10% reduction), the overall foreign 
assistance request for the region has remained in line with previous 
years because of increased Millennium Challenge Account (MCA) funding.
    Most of the reduction in CSH is in the family planning budget 
category. The Agency has recently developed criteria for phasing out 
USAID family planning assistance, based on two internationally accepted 
benchmarks in family planning: Total fertility and contraceptive 
prevalence rates. Using these criteria, the LAC Bureau has identified 
six countries in which to phase-out family planning assistance over a 
2- to 5-year period. The Bureau will gradually reduce the amount of 
CSH-funded family planning assistance in the Dominican Republic, El 
Salvador, Jamaica, Nicaragua, Paraguay, and Peru.
    Much work remains to be done to improve equitable and sustainable 
access to voluntary family planning services in Haiti, Bolivia, 
Guatemala, and Honduras--countries that do not meet the Agency-defined 
criteria for phaseout of family planning assistance. Therefore, these 
family planning programs are not being phased out.
    The administration has determined that the majority of CSH 
resources will be targeted to regions of the world that have greater 
need for health resources with large population densities, limited 
access to clean water, and lack arable land. No consideration was given 
to shifting resources to other countries in the region.

  WESTERN HEMISPHERE ACCOUNTS: COUNTERDRUG & LAW ENFORCEMENT PROGRAMS

    Question. The two key counterdrug programs for the region, 
International Narcotics Control and Law Enforcement (INL) ($60,885M to 
$54,800M) and Andean Counter Drug Initiative (ACI) (from $727,155M to 
$721,500M) have been decreased a total of $11,740M. This is the wrong 
time to trim counterdrug programs in the region. Why were these funds 
decreased overall? Why were programs in Peru and Bolivia decreased so 
much? (Peru: $106,920 to $98,500; Bolivia: From $79.2M to $66M)

    Answer. The decreased FY 2007 budget request for the Western 
Hemisphere INCLE account primarily reflects a $5 million reduction in 
funding for Haiti in an effort, to take into account the country's 
capacity to absorb assistance and effectively use the assistance we 
provide to rebuild law enforcement and judicial institutions.
    The FY 2007 budget request for all of ACI provides virtually the 
same level of funding as in FY 2006. However, the need to keep Colombia 
at viable levels, to meet funding requirements for the Air Bridge 
Denial program, and to accelerate the Critical Flight Safety program 
necessitated funding adjustments within the ACI account. For example, 
we will continue the Air Bridge Denial program in FY 2007 by funding it 
through the Colombia Interdiction line item instead of a separate line 
item, as was the case in previous fiscal years. The FY 2007 ACI request 
also devotes additional resources to the much-needed Critical Flight 
Safety Program. The increased request for this program will accelerate 
the Department of State's Air Wing's efforts to upgrade its severely 
aged aircraft fleet to commercial standards in order to sustain 
counternarcotics and counterterrorism missions in the Andean region.
    At $66 million, Bolivia will have sufficient funds to maintain 
current program levels. New programs that were envisioned for FY 2007, 
such as forced eradication operations in the Yungas, will not be 
possible at this level of funding. However, while the decision to 
reduce the Bolivia program to a level below the FY 2006 was made prior 
to the election of Evo Morales as President, it does not appear that 
the Morales administration is planning on pursuing aggressive coca 
reduction policies in the Yungas. USG-owned aviation assets in Bolivia 
will also benefit from the Critical Flight Safety program, which will 
upgrade seven helicopters at an approximate cost of $21 million.
    The FY 2007 funding request for Peru mirrors the administration's 
FY 2006 request of $98 million. An increased appropriation in FY 2006 
plus our FY 2007 request, along with some internal shifting of program 
resources, will enable the Government of Peru to enhance levels of 
interdiction and eradication to address the 38-percent increase in coca 
cultivation and meet program targets.

    Question. The two key counterdrug programs for the region, 
International Narcotics Control and Law Enforcement (INL) ($60,885M to 
$54,800M) and Andean Counter Drug Initiative (ACI) (from $727,155M to 
$721,500M) have been decreased a total of $11,740M. This is the wrong 
time to trim counterdrug programs in the region. Why was the Haiti law 
enforcement funding decreased--at a time when we need to sustain 
support to Haiti?

    Answer. We agree that Haiti needs sustained support. However, we 
must balance our efforts to build an effective administration of 
justice and law enforcement structure with the absorptive capacity of 
the Haitian Government. We have made a long-term commitment to rebuild 
Haiti's law enforcement and judicial institutions that takes into 
account Haiti's ability to use the provided assistance effectively.
    We believe that the level of funding for law enforcement is 
appropriate given the current situation in Haiti. We will continue to 
closely monitor the situation and recommend changes as necessary. We 
hope that our assistance will grow as a democratically elected 
government takes office and the fruits of our initial reform take hold, 
increasing Haiti's absorptive capacity.

   WESTERN HEMISPHERE ACCOUNTS: FOREIGN MILITARY FINANCING (FMF) AND 
      INTERNATIONAL MILITARY AND EDUCATION TRAINING (IMET) PROGRAM

    Question. What is your assessment of how the FMF program is working 
in the region?

    Answer. The FMF program in the Western Hemisphere is working well, 
despite the tight budget environment and American Servicemembers' 
Protection Act prohibitions on some military assistance programs. FMF 
assists regional governments to control their national territory, 
better defend maritime approaches to the United States, and undertake 
defense modernization for participation in peacekeeping and coalition 
operations. Among our larger programs, FMF supports Colombia's 
counterterrorism and naval interdiction efforts, which have resulted in 
a decrease in terrorist attacks in that country from 1,257 in 2003 to 
611 in 2005; modernization and interoperability programs for El 
Salvador, which as a key coalition partner is currently on its fifth 
rotation in Iraq and has committed to a sixth; and a new initiative--
Enduring Friendship--to enhance security of our ``Third Border'' by 
promoting Caribbean security and stability. In addition to individual 
country programs through which countries receive assistance, the 
Enduring Friendship regional program would provide FMF funds to select 
Caribbean countries to support maritime security efforts in the 
Caribbean Basin. Also, as part of the broader security assistance 
program for the region, four Central American countries have received 
peacekeeping operations funding in the past to enhance their 
peacekeeping capabilities as part of a worldwide peacekeeping 
operations initiative and may again receive funding in FY07.

    Question. Should we consider delinking IMET--for specifically 
targeted countries--from constraints imposed by American Service Member 
Protection Act (ASPA)?

    Answer. First, it is important to remember why we pursue article 98 
agreements. We have major reservations with the International Criminal 
Court and its claim of jurisdiction over U.S. persons. These agreements 
protect all U.S. persons and servicemembers from surrender to the 
International Criminal Court without our consent and thus remain a 
priority for the President and the Department of State.
    The prohibitions the Congress included in the American 
Servicemembers' Protection Act (ASPA) have been useful in securing many 
of the 101 article 98 agreements we have signed to date. These are 
important agreements to protect U.S. persons from illegitimate 
assertions of jurisdiction over all U.S. persons--particularly our 
servicemembers acting overseas. We have authority in the ASPA to waive 
the prohibitions for important national interests and are now reviewing 
the remaining IMET prohibitions on countries that have not yet signed 
an article 98 agreement to determine whether this prohibition is still 
helpful to our efforts to secure article 98 agreements and whether it 
is important to our national interest to restart IMET programs with 
these countries even in the absence of article 98 agreements.

    Question. Do you agree that the sanctions that cut the flow of IMET 
money can create a vacuum that other nations might fill and limit our 
contact? Is the executive branch considering using the ASPA authority 
to allow IMET money for countries that are ICC signatories--but do not 
have article 98 agreements? Do you think a legislative fix would be 
required?

    Answer. Attempts by countries such as China, the United Kingdom, 
Russia, France, and India to expand their influence by offering 
military training predates the American Servicemembers' Protection Act 
(ASPA), but the ASPA prohibitions may have opened a wider window of 
opportunity for them in some countries. The prohibitions Congress 
included in the ASPA have been useful in securing many of the 101 
article 98 agreements we have signed to date. These are important 
agreements to protect U.S. persons from illegitimate assertions of 
jurisdiction over U.S. citizens. We believe we have adequate authority 
in the ASPA to waive the prohibitions for important national interests 
and are now reviewing the remaining IMET prohibitions on countries that 
have not yet signed an article 98 agreement to determine whether this 
prohibition still provides leverage in our efforts to secure article 98 
agreements to protect U.S. persons from surrender to the International 
Criminal Court without U.S. consent and whether it is important to our 
national interest to restart IMET programs with these countries.

                    MILLENNIUM CHALLENGE CORPORATION

    Question. Is the $3B in this year's request enough? It appears that 
if you move forward on planned compacts that are already in the 
pipeline--your funds could be obligated by the end of this fiscal year. 
Is that accurate? What will happen if additional countries come on line 
seeking funding?

    Answer. On April 3, 2006, MCC will sign its eighth compact, 
reflecting commitments of over $1.5 billion, in addition to having 
signed threshold agreements with five countries for nearly $100 
million. In the current fiscal year, MCC is on track to finalize at 
least three more compacts totaling an additional $1.1 billion, which 
will represent funding commitments of up to $1.7 billion for FY06, 
almost twice the level committed in FY05.
    MCC projects that in the FY07, we expect to sign between 9 and 12 
new compacts, comprising commitments of more than $3 billion. As a 
result, MCC will have total commitments approaching $6 billion, with up 
to 21 countries, by the end of FY07.
    Because of the robust demand of eligible countries, we are 
projecting that all currently available program funds from FY04, FY05, 
and FY06 will be exhausted by the second quarter of FY07, making the 
FY07 request for MCC all that more critical to our success.
    At funding levels lower than $3 billion, MCC will likely delay 
negotiating compacts with some eligible countries, not to mention the 
newly eligible FY07 countries that the Board of Directors will select 
this November. It would be unfortunate if these countries who have 
undertaken significant political, economic, and social policy reforms, 
and those striving to be selected, find that meeting the criteria for 
eligibility does not result in actual funding of their development 
projects to achieve long-term sustainable economic growth.
    As Chair of the MCC Board of Directors, this is something I, and 
the board, feel strongly about, as noted in the recent letter to Senate 
and House appropriators that each member of the board signed. I look 
forward to working with Congress to ensure that MCC has sufficient 
funding as we move forward with our critical mission in the developing 
world.

    Question. I know that before the recent elections, the previous 
government in Bolivia submitted an ambitious project for the 
consideration of the MCC Board. What is the status of that project? Has 
the MCC Board reviewed it? Is it a proposal that has merit?

    Answer. The Bolivian Government under President Rodriguez delivered 
an ambitious proposal to MCC on December 1, 2005, 3 weeks before the 
elections that brought the Morales administration into power. At that 
time, MCC agreed with the Bolivian Government and the Bolivian Embassy 
in Washington that MCC would wait to review the proposal until the new 
government was established and indicated whether it wished to proceed 
with the December proposal or develop a new proposal.
    As of March 1, 2006, the Morales administration has not formally 
communicated its intentions to MCC with respect to the December 
proposal. The MCC Board of Directors has not reviewed the proposal. MCC 
staff has not undertaken a thorough review of the proposal as MCC is 
awaiting the position to be adopted by the Morales administration with 
respect to the proposal.

    Question. Was this project coordinated with the Morales campaign? 
If so, what have been the early signals on whether they will proceed 
forward vigorously with this project?

    Answer. The proposal submitted to MCC was not coordinated with the 
Morales campaign directly but rather was developed through a 
consultative process to which the Morales campaign and its major 
constituencies were parties. On several occasions during the process 
the Bolivian MCC program coordinator contacted the leaders of all the 
leading political parties with regard to the proposal being developed.
    As of March 1, 2006, the Morales administration has not formally 
communicated its intentions to MCC with respect to the December 
proposal.

    Question. What linkage--if any--is there between awards of 
Millennium Challenge funding and other State and USAID assistance? Do 
we decrease State-ESF or USAID DA or Child Surv/Health if/when a 
country receives MC assistance?

    Answer. Funding for MCA has not resulted in reductions to 
traditional assistance programs during this administration. Consistent 
with the commitments made in Monterrey, Mexico, the administration has 
maintained or grown the core development accounts while ramping up the 
Millennium Challenge Account (MCA) and the President's Emergency Plan 
for AIDS Relief (PEPFAR). For example, in 2001, enacted funding for 
Development Assistance and Child Survival & Heath accounts totaled 
$2.12 billion. In the President's FY07 budget, $2.71 billion is 
requested for these two same core accounts. As MCA builds to full 
capacity and its intended funding level of $5 billion annually, it will 
become the principal U.S. assistance mechanism in its partner 
countries, allowing USAID to continue to refocus its aid resources 
where they can have the greatest impact on poverty reduction and key 
development needs, like education and health.
                                 ______
                                 

                   Questions of Senator Paul Sarbanes

    Question. On what basis do you estimate such sharply reduced (IDFA) 
needs for FY 2007?

    Answer. The requested level of funding should be sufficient to 
maintain the U.S. Government's ability to monitor and initiate 
responses to emergency needs worldwide.
    IDFA funding for FY 2007 will also allow the U.S. Government to 
continue to improve emergency response and disaster mitigation 
capabilities of disaster-prone countries.
    The budget would not be sufficient to ensure an adequate U.S. 
Government response in the event of a large-scale natural disaster or 
major famine event (e.g., Asia's tsunami, Pakistan earthquake, Ethiopia 
2000-01).

    Question. Can you explain why you have once again cut ASHA in the 
FY 2007 request?

    Answer. FY 2007 is a tight budget year. We have allocated available 
resources as best we can to meet a broad range of priorities. We 
continue to value ASHA programs.

    Question. Despite a record of efficiency and results, acknowledged 
even by Ambassador Bolton, UNICEF faces a cut in the proposed U.S. 
contribution for FY07. Likewise, the budget request cuts over $14 
million from UNDP, and earmarks nearly half of the remaining $94.5 
million for trust funds. What is the rationale for cutting programs 
that have proven their cost-effectiveness?

    Answer. The administration's FY 2007 International Organizations 
and Programs (IO&P) request, which funds voluntary U.S. contributions, 
aims not to exceed $289 million, or 2.5 percent over the FY06 request. 
The requests for UNICEF ($123 million) and UNDP ($94.5 million) 
together account for 75 percent of the IO&P budget request.
    The FY 2007 request for UNICEF represents a $9 million increase 
over the administration's request of $14 million in FY06. The $9 
million increase in the request for UNICEF accounts for more than 100 
percent of the total net requested increase in the IO&P account ($289 
million in FY07 versus $282 million in FY06).
    The U.S. Government is the largest single donor to UNICEF. The 
United States has played a leadership role in UNICEF since its 
inception and continues to do so under the leadership of former 
Secretary of Agriculture, Ann Veneman, as the UNICEF Executive 
Director. The United States support for, and leadership in, UNICEF 
activities offers compelling evidence of the U.S. commitment to the 
United Nations, to multilateralism, and to addressing humanitarian 
crises and development challenges.

          With respect to UNDP, the administration's FY07 request of 
        $94.5 million is virtually the same as the FY06 request of $95 
        million. The FY07 request includes $50 million for UNDP's 
        regular budget to support administrative and general 
        programming costs. It also includes $24.5 million and $20 
        million respectively to UNDP trust funds for democratic 
        governance and crisis prevention and recovery. These are core 
        UNDP functions.

    Moreover, these allocations support the Secretary's initiative to 
restructure foreign assistance by aligning our resources with our 
interests and priorities.

    Question. What is the total of our current international 
peacekeeping arrears? Why has the administration not requested funding 
to pay these arrears? Do you support lifting the cap on peacekeeping 
contributions, which is the cause of our going into arrears?

    Answer. Prior to FY 2000, the U.S.-accumulated arrears of 
approximately $400 million primarily caused by a 25-percent cap on 
peacekeeping payments. Although Congress appropriated sufficient funds 
each year from FY 2000 until FY 2005 to pay annual assessments, the 
pre-2000 arrears remain outstanding, and in FY 2005 our arrears grew by 
$145 million because appropriated funds were not equal to our 
assessments.
    The shortfall for FY 2005 of $145.010 million and the projected 
shortfall for FY 2006 of $376.752 million totals $521.762 million. Due 
to the emergency situation in Sudan/Darfur, the FY 2006 supplemental 
budget contains a request of $69.8 million in the CIPA account for 
Sudan/Darfur as well as transfer authority language from the 
peacekeeping operations request which, in total, would offset $129.8 
million of the above total arrears for a net projected new arrears of 
$391.962 million at the end of FY 2006.
    The administration strongly supports full payment of U.N. 
peacekeeping assessments to ensure continued American leadership in 
shaping the international community's response to developments that 
threaten international peace and stability. The administration 
requested authority to lift the 25-percent assessment rate cap on 
payments of U.N. peacekeeping assessments during FY 2006, in order to 
permit payments at the rate assessed by the United Nations, up to 27.1 
percent. However, this authority was not included in the enacted FY 
2006 appropriations legislation.

    Question. What do you estimate to be the increased costs for 
salaries, hardship and danger pay, language training, educational 
allowances, security upgrades, and other personnel-related expenses in 
connection with the ``global repositioning'' plan?

    Answer. This summer we are beginning a shift of 100 personnel from 
Washington and the European Affairs bureau (EUR) to overseas positions 
in the other regional bureaus as well as within a number of regions. 
The initiative also includes new Iran-related positions in Washington 
and abroad. As we are just starting the implementation process, the 
impact in FY 2006 will mostly be related to one-time startup costs for 
establishing the new positions from EUR and Washington in other areas 
of the world and shifting positions within some regions. We are going 
through a process now to identify the net change in salary and position 
support costs, taking into account the timing of when incumbents will 
vacate positions being abolished and when officers will arrive in the 
newly created positions. These costs (approximately $5 million across 
all bureaus) are being incorporated into our FY 2006 spending plans and 
will pay future dividends by shifting our personnel and resources to 
critical needs posts overseas.

    Question. What kinds of security studies have been done, or will be 
done, prior to opening the American Presence Posts, where our diplomats 
would move outside the Embassy to live and work and represent America 
in potentially difficult and dangerous settings?

    Answer. The Bureau of Diplomatic Security participates in an 
interdepartmental working group that is studying the concept of 
American Presence Posts (APPs) and developing guidelines and procedures 
for opening APPs. The Secure Embassy Construction and Counterterrorism 
Act (SECCA) of 1999 (Public Law 106-113) requires that any new 
diplomatic facility meet collocation and 100-foot-setback statutory 
requirements. The collocation, setback, and waiver requirements 
uniformly apply to embassies, consulates, and APPs. Once a post has 
identified a potential APP site, the Regional Security Officer (RSO), 
in coordination with DS Headquarters and the Bureau of Overseas 
Buildings Operations (OBO), will conduct a physical security survey of 
the location to determine security requirements. APP sites must adhere 
to, or be in, the final stages of compliance with the Overseas Security 
Policy Board (OSPB) standards prior to occupancy. Additionally, waivers 
to SECCA and exceptions to OSPB standards must be obtained for any site 
deficiencies that cannot be remedied.

    Question. In the aftermath of September 11, Congress granted the 
President limited and conditional authority to waive section 907 of the 
Freedom Support Act. As part of that waiver, there was also an 
agreement made between the administration and Congress to ensure 
military parity between Armenia and Azerbaijan. However, in this year's 
budget, the President has requested $4.5 million in FMF for Azerbaijan 
and only $3.5 million for Armenia, as well as $885,000 in IMET for 
Azerbaijan and only $790,000 for Armenia. On what basis has the 
administration decided to depart from its previous commitment to 
provide equal amounts of military assistance for Armenia and 
Azerbaijan? What actions has the United States taken in response to 
belligerent rhetoric from Azerbaijan, such as President Aliyev's 
statements that ``this year defense spending has grown by 76 percent, 
we will create a powerful army and will be able to liberate our lands 
at any time,'' and that ``hostilities could break out again'' if the 
international community does not force Armenia to return Nagorno-
Karabakh?

    Answer. The waiver of section 907 of the FREEDOM Support Act 
annually since 2002 has allowed us to provide military assistance that 
enhances Azerbaijan's interoperability with NATO and U.S. forces. The 
proposed FY 2007 FMF level for Azerbaijan is linked to U.S. priorities 
in fighting terrorism and strengthening maritime security to address 
WMD proliferation, terrorist transit, and drug trafficking on the 
Caspian Sea. FMF will also enhance Azerbaijan's capabilities to 
participate in international peacekeeping efforts.
    We share your concerns about the still-unresolved Nagorno-Karabakh 
conflict. The minor increase in FMF for Azerbaijan as proposed in the 
President's budget request in January does not signal any change in the 
U.S. position on Nagorno-Karabakh. We have communicated that very 
clearly to the governments of both nations. Furthermore, we provide all 
assistance on terms that clarify both its intended purposes and the 
limitations on its use.

    Question. How much of Iraq's preinvasion debt has been forgiven by 
countries other than the United States? How much debt remains, and to 
which countries?

    Answer. Iraq's sovereign debt outstanding in April 2003 was 
approximately $124 billion, of which about $100 billion was owed to 
other countries and $24 billion owed to commercial creditors. Of the 
debt to other countries, $39.6 billion was held by Paris Club creditors 
(which includes the G-8 and other developed countries). The exact 
amount of Iraq's sovereign debt will only be known once Iraq has 
reconciled claims with all its creditors and negotiated debt reduction 
agreements.
    The Paris Club agreed in November 2004 to forgive 80 percent of 
Iraq's Paris Club debt in three tranches (30% when the agreement was 
signed; 30% once Iraq reached a standby arrangement with the IMF; and a 
final 20% after 3 years of successful performance under the standby 
arrangement). All but two of the 18 Paris Club members have signed 
bilateral agreements with Iraq implementing the Paris Club agreement. 
Iraq expects to reach agreements with the last two, Russia and 
Australia, soon.
    Iraq's remaining debt to other countries, estimated at about $61.6 
billion, is owed primarily to Arabian Peninsula countries ($44 
billion). Iraq expects to resume discussions soon with these debtors 
over settlement of their claims, which remain to be reconciled.
    We have urged all non-Paris Club countries to give Iraq debt 
reduction at Paris Club terms, if not better. Romania, Slovakia, and 
Malta have concluded debt agreements; we expect others to do so. At 
Iraq's request, the Paris Club will send letters to 11 of Iraq's non-
Paris Club creditors urging them to conclude agreements at Paris Club 
terms.
    Iraq has also made considerable progress with its commercial 
creditors, with claimants holding nearly 70 percent of the commercial 
claims having accepted offers to settle on terms comparable to Paris 
Club terms.

    Question. Why does the FY 2007 budget request fail to account for 
the full costs of ongoing war operations in Iraq and Afghanistan? How 
can these expenses be justified as ``unanticipated emergencies''?

    Answer. The FY 2007 request for foreign assistance includes $771.19 
million in ESF and other programs for Iraq, and $610 million in ESF and 
other programs for Afghanistan. None of this money has been requested 
to fund ongoing military operations. This funding would support 
programs that are critical to continuing our engagement with 
Afghanistan and Iraq, and supporting their transition to self-reliance.
    For Iraq, these programs are broken down into two main areas. 
First, $276.5 million is for a range of programs to develop the 
capacity of Iraq's national-level government, support economic reform, 
and develop the agricultural and private sectors. Second, $494.69 
million is requested to support a range of political, rule of law, and 
democracy programs. While we believe that this funding will be critical 
in achieving our goals of supporting Iraq's transition, we are not 
seeking these funds on the basis of ``unanticipated emergencies.''
    In Afghanistan, the $610 million FY 2007 ESF request represents 
funding for the large-scale USG reconstruction program taking place 
around the country. Like Iraq, this funding request is not for military 
operations and we are not seeking it on the basis of ``unanticipated 
emergencies.'' Almost half of the FY 2007 request--$276.5--will be used 
to fund infrastructure projects (roads and electrical power projects). 
The remainder of the FY 2007 ESF request, if approved, would be spread 
across various sectors including: Education, Health, Agriculture and 
Alternative Livelihoods, Economic Governance, Democracy and Governance, 
and PRT Quick Impact projects.

    Question. On January 5, the President announced the launch of a new 
``National Security Language Initiative'' and promised to request $114 
million in FY07. How much of this funding is included in the State 
Department's budget. Which new or improved programs will these funds 
support?

    Answer. The State Department portion of the $114 million is $26.7 
million. This amount will allow the Department to support study of 
critical languages by Americans and build on the achievements of the 
flagship Fulbright Scholarship program, Gilman Scholarships for U.S. 
undergraduates and youth exchange programs through the following 
activities:

   U.S. Fulbright Students: Provide 6 months of overseas 
        language study as an add-on to U.S. Fulbright student grants 
        for at least 150 selected participants to study critical-need 
        languages before beginning their academic projects.
   Intensive Advanced Language Study: Expand intensive overseas 
        summer language study institutes in critical-need languages for 
        American university students at intermediate and advanced 
        levels.
   Intensive Introductory Language Institutes: Increase the 
        study of critical-need languages by American undergraduates 
        through overseas summer language programs for beginners.
   Gilman Scholarships: Triple the number of opportunities for 
        Gilman scholars (U.S. undergraduates with financial need) to 
        study abroad in critical-need language countries.
   Fulbright Teaching Assistants: Expand the Fulbright Foreign 
        Language Teaching Assistant (FLTA) program to bring 300 foreign 
        teachers to the United States to help teach their native 
        languages at U.S colleges and high schools, while studying 
        English and U.S. studies.
   Teacher Exchange: Bring 25 foreign high school teachers of 
        English to the United States to teach Chinese, Arabic, and 
        Russian in U.S. high schools and send 50 American teachers 
        abroad for intensive summer study of critical-need languages.
   High School Exchange: Expand academic year, semester, and 
        short-term exchanges abroad for American high school students 
        in critical-need languages.
   Overseas Teaching: Increase support for USG-funded 
        institutions providing critical-need language instruction 
        abroad, such as the American Overseas Research Centers.

    In addition to the $26.7 million, the President's request includes 
$1.2 million to provide for 8 additional positions critical to the 
successful execution of these initiatives.

    Question. Concerns have been raised within the academic community 
that the Commerce Department's proposed rule on ``deemed exports'' will 
have a significant negative impact on our ability to attract and retain 
highly qualified foreign students and researchers to U.S. universities. 
Do you believe there are fundamental differences between universities 
and private companies that should be reflected in the final rule? When 
do you expect the Commerce Department to publish its response to the 
rulemaking?

    Answer. We are working with the Department of Commerce to ensure 
that should there be any change to the deemed export regulation, such a 
change would balance the need to protect national security with our 
ability to attract the best foreign researchers to our universities.
    The Export Administration Regulations (EAR) already treats 
university research differently and we don't expect this to change. The 
vast majority of basic and applied science research conducted in U.S. 
universities results in open and published information that is shared 
with the broader scientific community. This information is considered 
``fundamental research'' and does not require an export license under 
the EAR. Such research can be distinguished from corporate and U.S. 
Government sponsored research, the results of which are restricted for 
proprietary and national security reasons.
    We are encouraging the Department of Commerce to consult further 
with the academic community and others before publishing a proposed 
regulation.

    Question. During the course of developing your recommendations for 
changes to the U.S. foreign assistance structure, there has been 
virtually no consultation with congressional Democrats or with private 
voluntary organizations that play a major role in implementing foreign 
assistance programs. Why has there not been more consultation thus far, 
and what will you do to improve the consultative process as the reform 
effort proceeds?

    Answer. The changes that have been made to date are internal and 
aimed at seeking better performance under the authorities already 
granted us by the Congress. We welcome further discussions about ways 
to improve foreign assistance as we move forward.

    Question. Following your testimony before the committee on February 
16, 2005, you were asked a question for the record by Senator Biden, as 
follows:

          Question. When do you anticipate providing the 
        administration's treaty priority list for the 109th Congress?

          Answer. The Treaty Priority List has been prepared and is 
        being cleared throughout the executive branch; we plan to 
        submit it to the committee shortly. The Department recognizes 
        the importance of this list in assisting the committee to 
        organize its work and is very appreciative of the cooperation 
        it has received from the committee in the treaty law area 
        during the 108th Congress.

    Why has the Treaty Priority List for the 109th Congress never been 
submitted?

    Answer. In a letter of April 5, 2006, the State Department provided 
Senator Biden with a list of 16 treaties that had been identified in 
briefings by the administration as treaty priorities or treaties for 
which the administration supported progress by the Senate. These 
treaties are as follows:

   Extradition Treaty with the United Kingdom
   Treaty with Japan on Mutual Legal Assistance in Criminal 
        Matters
   Treaty with Germany on Mutual Legal Assistance in Criminal 
        Matters
   Convention on the Conservation and Management of Highly 
        Migratory Fish Stocks in the Western and Central Pacific Ocean
   Convention for Strengthening of the Inter-American Tropical 
        Tuna Commission Established by the 1949 Convention Between the 
        United States of America and the Republic of Costa Rica
   Agreement with Canada on Pacific Hake/Whiting
   Protocol of 1997 To Amend the International Convention for 
        the Prevention of Pollution From Ships, 1973, as Modified by 
        the Protocol of 1978 Relating Thereto
   Convention on Supplementary Compensation for Nuclear Damage
   Council of Europe Convention on Cybercrime
   United Nations Convention Against Transnational Organized 
        Crime and Two Supplementary Protocols
   Protocol of Amendment to the International Convention on the 
        Simplification and Harmonization of Customs Procedures
   Inter-American Convention Against Terrorism
   United Nations Convention on the Law of the Sea
   Rotterdam Convention on the Prior Informed Consent Procedure 
        for Certain Hazardous Chemicals and Pesticides in International 
        Trade, with Annexes
   Stockholm Convention on Certain Persistent Organic 
        Pollutants
   Treaty with Sweden on Mutual Legal Assistance in Criminal 
        Matters

    Since last year's briefings, we are pleased that the Senate took 
action on the treaties listed below:

   Convention on the Conservation and Management of Highly 
        Migratory Fish Stocks in the Western and Central Pacific Ocean
   Convention for Strengthening of the Inter-American Tropical 
        Tuna Commission Established by the 1949 Convention Between the 
        United States of America and the Republic of Costa Rica
   Agreement with Canada on Pacific Hake/Whiting
   United Nations Convention Against Transnational Organized 
        Crime and Two Supplementary Protocols
   Protocol of Amendment to the International Convention on the 
        Simplification and Harmonization of Customs Procedures
   Inter-American Convention Against Terrorism

    We would appreciate the committee's rapid action on the treaties 
remaining on the original list. We also would be happy to discuss any 
additional treaties on which you may have questions or an interest.
                                 ______
                                 

                  Questions of Senator Lincoln Chafee

    Question. Can you explain how this budget submission meets the 
needs of the new Liberian Government as you currently view them, and 
amplify in what ways you could envision your position changing if the 
Liberian Government says they need more assistance?

    Answer. Thanks to strong congressional support in fiscal years 
2004, 2005, and 2006, the United States has been able to play the 
leading role in helping Liberia begin recovery from 14 years of civil 
war, generations of corruption, and a near-total absence of government 
services and of respect for human rights and the rule of law. This 
funding is key to helping the new Government of Liberia establish the 
conditions for consolidating the peace and building prosperity.
    The FY 2007 request of $89.945 million for Liberia should continue 
our support for many programs:

   Economic Support Funds (ESF) would continue to provide 
        funding primarily for quick-impact reconstruction of schools, 
        hospitals, and government buildings in county centers using 
        war-affected youth, as well as rural road construction needed 
        to facilitate economic revival. It would also support 
        transparent economic management (GEMAP), civil service 
        retrenchment, national reconciliation (TRC), judicial reform 
        and police training.
   Child Survival and Health (CSH) would expand primary health 
        care in targeted communities; strengthen nongovernmental 
        organizations and county health teams organizationally; and 
        expand health care training.
   Development Assistance (DA) would expand USAID's community-
        focused, post-war rehabilitation and reconstruction activities. 
        DA would increase access to justice, agricultural production 
        and market access, train newly elected government officials, 
        strengthen civil society, and support education.
   International Narcotics Control and Law Enforcement (INCLE) 
        funds would provide civilian police to the U.N. mission to 
        monitor, mentor, and reform the Liberian National Police.
   Peacekeeping Operation funds (PKO) would support security 
        sector reform (SSR). This funding would help create a 
        professional, capable, and fiscally sustainable Liberian 
        military.
   Foreign Military Financing (FMF) would support ongoing SSR 
        with sustainment training and some military equipment.
   International Military Education and Training (IMET) would 
        fund leadership and specialized skills training for the new 
        Liberian military.
   Migration and Refugee Assistance (MRA) funding for Africa 
        would support the return and reintegration to Liberia of 
        refugees and internally displaced persons and Liberian refugees 
        from Cote d'Ivoire, Guinea, and Sierra Leone.

    We have ongoing discussions with the Liberian Government about the 
country's needs and will continue to consider those needs in 
conjunction with our policies and budget priorities.

    Question. Also, we have a large, vibrant, and important Liberian 
population in Rhode Island, and they are justifiably concerned about 
what their immigration status will be with a newly elected government 
in Liberia. As you know, these brave people came to a new country after 
fleeing a disastrous situation in their home country and have set down 
roots, started families, become part of the community. In addition to 
being an asset here, they are an important source of support, for 
instance through remittances, for family members that reside in 
Liberia. I know this is outside your specific purview, but I think you 
are an important voice on this issue: Can you share with me your view 
on the immigration status of Liberians residing in the United States as 
well as whether you support the goal of Senator Reed and my bill, S. 
656?

    Answer. As you have indicated, many of the 15,000-20,000 Liberians 
living in the United States fled their country's long civil war. Now 
that peace is taking hold in Liberia and a new, democratically elected 
government is in place, many of these Liberians will choose to return 
home. Many others will choose to remain in the United States and move 
ahead on the path toward U.S. citizenship.
    Some 3,792 Liberians are currently living in the United States 
under Temporary Protected Status (TPS). As you are aware, the power to 
grant TPS is based upon criteria outlined in section 244 of the 
Immigration and Nationality Act (INA), 8 U.S.C. 1254a, and is vested in 
the Department of Homeland Security (DHS). The Secretary of Homeland 
Security exercises this authority in consultation with the State 
Department and other appropriate agencies. On August 16, 2005, DHS 
announced an extension for a period of 12 months of the TPS designation 
for Liberia. The State Department is consulting with DHS on country 
conditions in Liberia in the current review of Liberia's TPS status.
    As for S. 656, the Liberian Refugee Immigration Fairness Act of 
2005, the Office of Management and Budget normally coordinates the 
administration's position on pending legislation. The State Department 
would be but one interested agency contributing to that overall 
position. I would not want to get ahead of that process here.

    Question. In his State of the Union Address, President Bush spoke 
of the importance to U.S. national security of investing in the foreign 
affairs budget by stating, ``Shortchanging these efforts would increase 
the suffering and chaos of our world, undercut our long-term security, 
and dull the conscience of our country.'' Secretary Rice, could you 
comment on how the programs in your budget are an integral component of 
our country's national security? Also, given the importance you and the 
President have placed on development, democracy, and diplomacy, does 
this budget provide enough funding to meet our national security needs?

    Answer. Assuring U.S. national security, both physical and 
economic, immediate and long term, is our top foreign policy priority. 
It is the prerequisite to our freedom and prosperity, and to our being 
able to advance these goals elsewhere. But our security interests 
cannot be achieved apart from our development goals and our democratic 
ideals in today's world. Our assistance must integrate and advance all 
of these goals together.
    Accordingly, the primary objective of our assistance is to build 
and sustain democratic, well-governed states that will respond to the 
needs of their people and conduct themselves responsibly in the 
international system. In the near term we must give priority to nations 
that are strategically important in the war against terrorism. The 
largest single piece of our 2007 foreign assistance budget request is 
to strengthen the coalition partners on the front lines in the fight 
against terrorism. Our assistance empowers our partners to practice 
more effective law enforcement, police their borders, gather and share 
essential intelligence, wage more successful counterterrorism 
operations, and provide for their own defense. In many states, our 
assistance will also help to bolster thriving democratic and economic 
institutions reducing the societal schisms that terrorists exploit for 
their own ideological purposes. These programs support not only the 
security of our friends and allies, but ultimately the security of the 
United States.

    Question. In 1975 Daniel Patrick Moynihan observed that ethnic 
influence has become ``the single most important determinant of 
American foreign policy.'' In the last quarter century, global travel 
networks and communications technology have enabled a growing number of 
the world's population to simultaneously participate in more than one 
society. What is the State Department's perception of these diaspora 
communities? Do you think there are benefits, or negative consequences, 
to engagement with diasporas, specifically with regard to our foreign 
policy goals? Are there any foreign aid projects currently being 
conducted, or planned on, through this budget, that include diaspora 
research and engagement? In your opinion, are these projects, if any, 
sufficient? What types of further initiatives--either specific projects 
or more general policy-focused research--do you think could be useful?

    Answer. The United States rightly celebrates its diverse 
population. Diaspora communities can be a powerful force for positive 
change. Indeed, many of our programs in settings as diverse as India, 
Armenia, and Haiti are already building effective partnerships with 
diaspora communities to accelerate development.
    At the same time, we recognize that this subject warrants more 
research and discussion which could generate new opportunities for 
collaboration. I welcome the opportunity to work with diaspora 
communities to encourage their contributions to our foreign assistance 
efforts.

    Question. Nearly 11 million children under the age of 5 die each 
year. Many of these children live in the developing world, and the most 
common causes of death are preventable or treatable diseases such as 
measles, tetanus, diarrhea, pneumonia, and malaria. These illnesses are 
easy to diagnose and extremely cost effective to treat. To help address 
this problem, I am proud to have joined with Chairman Lugar, Senator 
Boxer, and many others in enacting the Assistance for Orphans and Other 
Vulnerable Children in Developing Countries Act of 2005. More broadly, 
in 2000, the United States joined 188 other countries in supporting 
eight Millennium Development Goals designed to achieve ``a more 
peaceful, prosperous, and just world.'' Two of the Millennium 
Development Goals call for a reduction in the mortality rate of 
children under the age of 5 by two-thirds and a reduction in maternal 
deaths by three-quarters by 2015. On September 14, 2005, President 
George W. Bush stated before the leaders of the world: ``To spread a 
vision of hope, the United States is determined to help nations that 
are struggling with poverty. We are committed to the Millennium 
Development Goals.'' Will the funding requested for child survival and 
maternal health meet the goals we have committed to?

    Answer. The Millennium Development Goals (MDGs) include, inter 
alia, the global targets to reduce by two-thirds the mortality rate of 
children under 5 and to reduce by three-quarters the maternal mortality 
ratio by 2015. The MDGs are targets for all U.N. Member States, and we 
are working together with other donors to make the most effective use 
of aid resources. Money alone is not sufficient to meet the MDGs on 
time. According to UNICEF, for example, at the current rate of progress 
it will take until 2045 (as opposed to 2015) to reduce under-5 
mortality by two-thirds in developing countries.
    More important than money is building capacity to achieve the MDGs. 
U.S. foreign assistance programs work closely with countries on a 
bilateral level, as well as on a multilateral level through our 
partners, the United Nations, and other organizations. Our programs in 
global health have had a great and lasting impact not only because we 
are committing more public and private resources, but also because we 
are altering the landscape of our foreign assistance programs with a 
commitment to results. Through a series of international conferences, 
treaties, and initiatives, world leaders, governments, and donor 
agencies have developed strategies aimed at reducing child and maternal 
mortality, halting and reversing the spread of HIV/AIDS and other 
infectious diseases, insuring financing for these as well as other 
development needs, and formulating a global plan of action for 
sustainable development. Great strides have been made: Immunization 
programs have saved millions of children's lives; low-cost rehydration 
therapy has contributed to a 33-percent increase in life expectancy in 
the developing world; smallpox has been eradicated worldwide; and in 
the past 20 years the number of the world's chronically undernourished 
has been reduced by 50 percent.

    Question. The President highlighted the importance of basic 
education, especially the unmet educational needs of girls throughout 
the world, in the State of the Union. I agree with him, and you, 
Secretary Rice, on the goals of improving basic education, and it being 
a critical element of transformational diplomacy. Given its importance, 
I am curious to why funding is not more robust. Can you speak to why 
the administration has requested a cut in funding for basic education? 
Can you address whether the number of countries receiving basic 
education assistance will be reduced, what countries will be affected, 
and if fewer children will be educated if the budget request is 
enacted?

    Answer. The administration has allocated 20 percent of its 
Development Assistance request for FY 2007 to basic education. This is 
the same proportion of Development Assistance (DA) funds as was 
allocated to basic education in FY 2005 and reflects the importance the 
administration places on improving basic education in its overall 
development agenda.
    In its FY 2007 Congressional Budget Justification, the Agency for 
International Development proposed that 36 countries receive DA-funded 
basic education assistance. That is three fewer countries than are 
receiving DA-funded basic education assistance in FY 2006. Benin, 
Madagascar, and Malawi are the countries that would not receive basic 
education development assistance in FY 2007.

    Question. I think our response to the tsunami and the Pakistani 
earthquake demonstrated our compassion as a nation. In addition to 
being the right thing to do, it appears that we are benefiting from our 
actions in terms of improving our standing in the Muslim world. Many 
have said that the sight of the USS Abraham Lincoln, used as a base of 
operations following the tsunami off the coast of Indonesia, and the 
sight of U.S. helicopters in Pakistan in relief operations after the 
earthquake were tangible evidence of U.S. power being used for good. 
With the military humanitarian relief response ending, how are we 
continuing to visibly demonstrate that we have a long-term commitment 
to helping these people recover? Also, are we using the space that 
these events seem to have created to push for peaceful resolution to 
regional conflicts? I know we have seen notable successes in Indonesia, 
and I am wondering if similar efforts are being made in Sri Lanka and 
Kashmir?

    Answer. The humanitarian assistance provided by the United States 
after the tsunami and the earthquake vividly demonstrates America's 
compassion, generosity, and commitment to help those in need and has 
helped to improve the image of the United States among both Muslims and 
non-Muslims in the developing world.
    The United States will continue to provide humanitarian assistance 
to the survivors of the October 8 earthquake after U.S. military in-
kind support ends on March 31. Our humanitarian assistance has been 
widely publicized in Pakistan through Embassy Islamabad's daily press 
releases and frequent local media placements. Relief supplies provided 
by the U.S. Agency for International Development are required to be 
marked with the ``USAID brand,'' which indicates that the goods are a 
gift from the American people. Projects funded by the Office of Foreign 
Disaster Assistance through its implementing partners are also 
``branded.'' These projects will continue to operate and remind 
Pakistanis of the U.S. contributions to the humanitarian effort after 
the earthquake relief response ends.
    Looking ahead, the United States signed a $200 million agreement 
with Pakistan in January covering an ambitious 4-year U.S. 
reconstruction program (fiscal year 2006-fiscal year 2009) whose focus 
is to rebuild schools and primary health care facilities, ensure a 
trained workforce, and improve livelihoods. These permanent, seismic-
resistant facilities will bear a plaque indicating that they have been 
funded by the United States. The Embassy will continue to publicize the 
substantial U.S. contributions to relief and reconstruction to reaffirm 
our long-term commitment to help Pakistan recover from the earthquake. 
The President's budget request for fiscal year 2007 includes $50 
million in new funding to continue earthquake reconstruction begun in 
fiscal year 2006.
    Pakistan and India have used the earthquake to make modest progress 
in dealing with the Kashmir dispute. We believe that both governments 
should take advantage of this opening to advance the reconciliation 
process and resolve Kashmir peacefully, taking into account the wishes 
of the people of Kashmir. On March 4 in Islamabad, President Bush said, 
``The best way for Kashmir to be resolved is for leaders of both 
countries to step up and take the lead. And that's exactly what 
President Musharraf has done, and that's what Prime Minister Singh has 
assured me he wants to do, and that is to resolve this situation. 
Obviously, there needs to be some confidence in order for the countries 
to go forward, and therefore, the confidence-building measures that the 
governments have taken is beginning to bear fruits, in my judgment . . 
. However, in order for a deal to get done, it requires commitment at 
the leadership level. And in my perspective, I've seen the commitment, 
and the role of the United States is to continue to encourage the 
parties to come together.''
    The President alluded to some developments that occurred after the 
earthquake. India and Pakistan opened five border-crossing points on 
the Line of Control. The two countries are discussing proposals to 
permit the regular shipment of goods by truck through these crossing 
points. Openings in the Line of Control have the potential to be 
significant, reversing more than 50 years of policy forbidding direct 
travel between the two halves of Kashmir. The people-to-people contacts 
allowed by these crossing points should greatly improve mutual 
understanding and encourage both governments to continue to seek 
resolution of the Kashmir dispute.
    Fifteen months after the tsunami struck Sri Lanka, the United 
States continues to address many facets of the longer term 
rehabilitation and reconstruction effort. Highlights include 
construction of a new Arugam Bay bridge, designed to last a century and 
the only direct link between two tsunami-devastated communities in the 
east; repairs and upgrades of three damaged harbors, vital to the 
livelihoods of coastal communities; rehabilitation or reconstruction of 
vocational as well as educational schools; and construction of 
playgrounds.
    In the aftermath of the tsunami, the U.S. Agency for International 
Development provided targeted support to 20 municipalities in tsunami-
affected districts, focusing on training and technical assistance for 
political parties at the district level to facilitate a consensus on 
community rehabilitation and service needs. The programs provided 
capacity development for community forums to create a network of 
citizen-led advocacy groups. These initiatives increase the 
responsiveness of political actors and government officials to 
community-based needs and opinions on peace and development issues.
    The United States had hoped that the implementation of the Post-
Tsunami Operational Management Structure, a joint mechanism for 
managing tsunami relief and reconstruction in Tamil areas, would have 
helped build confidence between the government and Liberation Tigers of 
Tamil Eelam and led to progress in the broader peace process. 
Unfortunately, the Post-Tsunami Operational Management Structure was 
never implemented after its constitutionality was challenged before the 
Supreme Court. President Rajapaksa has established a new government 
agency to oversee tsunami reconstruction, including a program to 
replace the Post-Tsunami Operational Management Structure.
    We welcome the recent progress made in the peace process at the 
recent talks in Geneva between the government and Liberation Tigers of 
Tamil Eelam and hope this will lead to further cooperation in providing 
relief and reconstruction assistance to tsunami-affected areas.

    Question. With regard to Pakistan, while the improvement of our 
image following our response to the earthquake was significant, how 
would you analyze our standing now? Can you comment on the cartoons of 
the prophet Muhammed published in Denmark last fall, and the current 
riots in Pakistan, and what that means for our efforts there? Also, can 
you give us an update on what the President may bring up on his visit 
to the region next month, and in particular focus on what efforts will 
be made for further democratization?

    Answer. President Bush's visit to Pakistan highlighted several 
aspects of our relationship with Pakistan that directly address the 
interests of its people. Most importantly, the President underscored 
our commitment to a long-term strategic partnership with Pakistan. This 
partnership will benefit the people of Pakistan through greater 
engagement in fields including energy security, education reform, 
economic opportunity, and science and technology. The President also 
reiterated our commitment to supporting reconstruction in earthquake-
affected areas. Our relief and reconstruction efforts have always been 
designed to meet urgent humanitarian needs, but they have also improved 
the popular image of the United States. We are confident that our 
ongoing support for Pakistan's reconstruction efforts will continue to 
demonstrate America's compassion, shifting perceptions over the long 
term.
    President Bush and President Musharraf spoke about the need not to 
hurt religious sensibilities when the topic of the Danish cartoons 
arose. Many protests in Pakistan were peaceful. We all support the 
peaceful right to protest. We do not believe that violence and rioting 
are acceptable political statements.
    On democracy, President Bush said, ``The elections scheduled for 
2007 are a great opportunity for Pakistan. The President [Musharraf] 
understands these elections need to be open and honest. America will 
continue to working--working with Pakistan to lay the foundations of 
democracy.'' President Bush also underscored the importance the United 
States places on democracy during his meetings with Pakistani 
officials. The Department of State is working with the government, 
political parties, and civil society organizations in Pakistan to 
ensure that all political parties will have an opportunity to 
participate in free and fair elections in 2007.
                                 ______
                                 

                    Questions of Senator Chuck Hagel

                      REGIONAL MIDDLE EAST ISSUES

    Question. How does the United States consult with our Middle East 
partners, and in particular the Gulf States, on the range of critical 
Middle East issues: Iran, Iraq, Hamas, Hezbollah?

    Answer. We have established productive consultative mechanisms with 
the governments of the region, covering a broad range of topics. In 
addition, senior officials, beginning with Secretary Rice, frequently 
travel to the region, engaging on every issue of concern. Secretary 
Rice was most recently in the Middle East April 26-27, when she visited 
Iraq. Our Ambassadors and Embassy staffs also enjoy excellent access to 
officials at all levels through the governments of the region.

    Question. Isn't there a need for a better consultative mechanism 
with our gulf partners that creates a framework for our relationships, 
and ensures we don't consult with gulf countries only when we have a 
request?

    Answer. Secretary Rice has met collectively with her Gulf 
Cooperation Council counterparts three times since the fall: In 
September, at the United Nations General Assembly; in November in 
Bahrain; and in February in the United Arab Emirates. In addition, our 
Ambassadors and Embassy staffs enjoy excellent access to officials at 
all levels through the governments of the region, and senior officials 
frequently travel to the region to consult with their counterparts. We 
have almost 10 formal consultative mechanisms with the governments of 
the gulf that ensure that we share our views regularly, and not just 
when we seek their assistance. They cover topics from economics and 
trade to counterterrorism to a broad range of strategic discussions. 
The United States-Saudi Arabia Strategic Dialogue, for example, was 
inaugurated last November and comprises Working Groups on 
Counterterrorism, Human Development and Exchanges, Military Affairs, 
Energy, Consular Affairs, and Economic and Financial Affairs.

                    IRAN: U.S. DEMOCRACY ASSISTANCE

    Question. Please provide a detailed description of U.S. assistance 
programming based on FY05, FY06, and requested FY07 (including 
supplemental) funds. Are any U.S. assistance funds being spent to 
increase access to the Internet for people inside Iran?

    Answer. Our foreign assistance programs for the Near East and North 
Africa are contained in the Department's Congressional Budget 
Justification, available on-line at http://www.state.gov/documents/
organization/60654.pdf. This document contains both the requested 
funding levels and a detailed description of their aims. It includes 
both bilateral and regional programs, such as the Middle East 
Partnership Initiative and the Multinational Force and Observers.
    With regard to Iraq, our foreign assistance program is explained in 
two separate parts: First, the bulk of the funding enacted in 2003 can 
be found in the document entitled ``Rebuilding Iraq: U.S. Achievements 
Through the Iraq Relief and Reconstruction Fund,'' available on-line at 
http://www.state.gov/p/nea/rls/rpt/60857.htm. Second, our latest FY06 
and FY07 budget proposals are highlighted in the document entitled 
``Advancing the President's National Strategy for Victory in Iraq.'' 
This document is available on-line at http://www.state.gov/p/nea/rls/
rpt/62397.htm.
    The United States is at a critical juncture in its concerns with 
the Iranian regime. Iran's support for international terrorism, 
rejection of the Middle East peace process, lack of respect for the 
human rights of its citizens, and its lack of democracy. Of course, as 
the President said, we are also deeply concerned about ``the Iranian 
Government defying the world with its nuclear ambitions.'' These are 
serious impediments to Iran's normal relations with the international 
community. These concerns are symptoms of this corrupt regime's lack of 
transparency, political openness, and respect for its people.
    This year, a Department-wide effort will invest over $10 million in 
programs that promote democracy and respect for human rights in Iran. 
This is the third year of this effort. This effort aims to assist those 
in Iran who are working to bring about increased freedom, better 
opportunities for all Iranians, and greater respect for human rights. 
They include civil society activists, advocates for political and 
economic freedom, those promoting greater freedom of speech and the 
media, labor rights activists and advocates for rule of law, and 
increased respect for human rights. The process for awarding these 
grants is currently ongoing and no funding decisions have yet been 
made.
    In addition to these programs, part of the supplemental budget 
request the Secretary made to Congress was to expand our communication 
with the Iranian people. Part of our effort to expand freedom of speech 
will include programs to provide information to Iranians via the 
Internet.
    The Department has, for the past 3 years, been operating its own 
Persian-language Web site. The latest metrics show that visits to the 
site have increased 282 percent in the first 3 months of 2006 as 
compared to the same period in 2005, and over 60 percent of the 
visitors come from inside Iran. The site offers content on democracy, 
U.S. policy, and global issues. The supplemental request would allow 
the Department to add staff and increase translation to dramatically 
increase content, provide interactive programs, including Web chat and 
Web casting, and significantly increase marketing. The supplemental 
request would also enable the Department to program speakers on 
democracy and governance topics in neighboring countries, then sending 
the content back into Iran via neighboring country media and our 
Persian Web site.

    Question. Will the U.S. Government provide any assistance for the 
purpose of developing Iranian opposition groups outside of Iran?

    Answer. We have made clear that the United States strongly supports 
the aspirations of the Iranian people for freedom and democracy in 
their country. As President Bush said in the State of the Union 
Address, ``Our Nation hopes one day to be the closest of friends with a 
free and democratic Iran.''
    We plan to use $15 million of our supplemental request--in addition 
to the $10 million that Congress has already appropriated--to empower 
Iranian activists and further human rights, support and strengthen 
civil society, help Iranians acquire the skills of citizenry and 
advocacy, support alternative political centers of gravity, improve 
justice and accountability, and increase tolerance and freedom of 
speech, assembly, and other basic rights for the Iranian people.
    Our projects focus on influential democratic actors and groups, 
including labor, women, and students. To this end, the Middle East 
Partnership Initiative and the Bureau of Human Rights and Labor will 
accept concept papers for over $10 million in grants to accelerate the 
work of Iranian reformers and human rights and democracy activists.

    Question. Aren't democracy programs that use U.S. NGOs (such as 
IRI, NDI and NED, or their intermediaries) going to be hampered simply 
because they are American or affiliated with the United States? Which 
Western NGOs currently operate in Iran?

    Answer. Iranian reformers find themselves in dangerous situations 
every day. We recognize that Tehran is suspicious of foreign 
cooperation with domestic Iranian NGOs and likely monitors those 
relationships.
    This presents an obstacle to our promotion of democracy in Iran 
though not an insurmountable one. The administration stands with 
courageous reformers who are on the frontlines of freedom working to 
have a voice in their own future. To ensure that our programs can be 
implemented safely, we do not publicly identify individual recipients 
of U.S. funding.
    A number of Western NGOs--including several U.S.-based NGOs 
operating under OFAC licenses; the London-based Committee to Defend 
Women's Rights in the Middle East, which has an Iranian cofounder; the 
Dutch-based Institute for Advocacy for Development Cooperation; and the 
German-based Friedrich Ebert Foundation--operate in Iran. These 
organizations focus on a variety of missions, including advocating for 
women's rights, facilitating the exchange of ideas between European and 
Iranian groups, working with youth groups and intellectuals, and 
capacity building for Iranian civil society activists.

    Question. How does the administration engage the Iranian diaspora 
who live in the United States?

    Answer. We communicate with a broad spectrum of the Iranian 
diaspora worldwide, including in the United States. The American 
diaspora community can play an important role in the promotion of 
political reform in Iran. U.S. policy recognizes that political reform 
within Iran must be indigenous. The administration is prepared to 
support civil society and the cause of freedom in Iran.

                 IRAQ: PROVINCIAL RECONSTRUCTION TEAMS

    Question. In September, you told this committee that, as part of 
the clear, hold, and build strategy, the administration would be 
standing up Provincial Reconstruction Teams in each of the non-Kurdish 
governorates, and one for the three Kurdish governorates. Aside of the 
three consulates which have been renamed PRTs, how many new PRTs are 
fully operational in Iraq? Please provide a specific timeline for 
standing up the remaining PRTs.

    Answer. Our three Proof of Concept PRTs in Mosul, Kirkuk, and 
Hillah have been up and running since November. The first evaluation of 
the synergy produced by combining some military civil affairs 
operations with State and USAID political and capacity-building 
operations is positive. The Baghdad PRT is our next highest priority, 
and we are now coordinating with the Iraqis, DOD, coalition partners, 
and other U.S. agencies to roll out this PRT as soon as possible. Our 
British and Italian partners are pressing ahead to roll out PRTs in 
Basra and Dhi Qar provinces, in which the United States would 
participate. These PRTs could be ready by May. We continue to refine 
our planning for other PRTs, and we expect the stand-up process to 
continue over the next 6 months, as resources permit.

                        IRAQ: CORRUPTION AND OIL

    Question. Oil exports are Iraq's primary source of revenue, and 
Iraq's primary cause for corruption. Today, oil revenues are controlled 
by the central government with little transparency and accountability.

   What are the United States, the IMF, the World Bank, and 
        others doing to help Iraq fix this problem?
   Why aren't we leveraging our assistance to pressure the 
        Iraqis to clean up the distribution of its oil revenue?
   A recent Brookings report recommends a fixed distribution 
        plan of oil revenues, with portions of oil proceeds going 
        directly to the central government, to local and provincial 
        governments, and to an infrastructure repair fund, etc. What is 
        the administration's assessment of such a proposal?

    Answer. The IMF, World Bank, United Nations, and United States 
agree that more transparency in Iraq's oil industry is crucial, and all 
are working with the Government of Iraq to address this issue. The IMF, 
World Bank, United Nations, and the Iraqi Government are members of the 
International Advisory and Monitoring Board (IAMB), established by the 
United Nations to provide transparency in Iraq's oil revenues. The 
United States is an observer to the IAMB. The IAMB provides oversight 
of the Development Fund for Iraq (DFI), into which all Iraqi crude oil 
export revenues (the vast majority of Iraqi Government revenues) are 
deposited. The IAMB mandate was authorized in UNSCR 1546. The mandate, 
which was extended in UNSCR 1637, expires on December 31, 2006, unless 
a new U.N. Security Council resolution extends it further. The IAMB 
authorizes audits of the DFI, including reviews of cash receipts and 
payments from the DFI as well as an assessment of internal controls. In 
effect, the audits assess how well the Iraqi Government is managing the 
execution of its budget (both expenditures and revenues). The 
assessments have led to a number of recommendations that the IAMB and 
other donors (including the United States) have discussed with Iraqi 
officials.
    The IMF Stand-By Arrangement (SBA) also contains recommendations 
that reinforce those made by the IAMB. In the area of fiscal 
management, recommendations included the establishment of a special 
Ministry of Finance unit to prepare monthly government cash-flow 
projections and an audit oversight committee to succeed the IAMB by the 
end of 2006. The SBA also required a review of existing procurement 
rules to bring them in line with international standards and the 
adoption of improved budget execution regulations. Specifically for the 
oil sector, the IMF recommended that Iraq install an oil metering 
system, restructure the sector to consist of commercial enterprises 
overseen by the Ministry of Oil; and draft new laws to regulate the 
hydrocarbons industry that would be in line with the new Iraq 
Constitution and international best practices. We agree strongly with 
the IAMB and IMF recommendations, which mirror many of our own 
recommendations to the government.
    We are using IRRF funds to help the Government of Iraq install 
meters on the Al-Basra Oil Terminal, the primary loading point for 
crude oil exports. This will provide better accountability and 
transparency for exports. This and other projects are improving Iraq's 
ability to implement the recommendations above and provide the 
technical capacity needed to change the sector's operational history. 
The Governments of the United Kingdom and Norway are also working with 
the Iraqis on technical training of officials in the area of oil sector 
transparency. In addition to its role on the IAMB, the World Bank is 
providing policy advice to the government based on its experience in 
other countries.
    These reforms and others already underway will go far to improve 
the government's ability to formulate, execute, and account for its 
fiscal processes. They will also help add transparency to the process, 
which an emergent civil society can use to hold the government 
accountable, thus deepening Iraq's democratic foundation.
    Regarding the Brookings report, the State Department agrees that 
ensuring sufficient budgetary resources to fund central and constituent 
government operations, social services, and maintenance of key 
infrastructure (four of the five ``baskets'' mentioned in the report) 
will be crucial challenges for the next government, along with the 
fiscal transparency and anticorruption issues mentioned above. Revenue 
sharing arrangements in particular are a key issue in talks on 
finalizing the constitution.
    The fifth basket in the Brookings report recommends an oil fund to 
provide annual direct payments to Iraqi citizens based on some 
percentage of Iraqi oil earnings. This recommendation is more 
problematic. The idea is attractive on its face and we are optimistic 
that Iraqi oil production will eventually generate budgetary surpluses 
that could be invested in various ways for the future. But at present 
Iraq runs a large fiscal deficit and cannot afford to divert funds from 
pressing reconstruction needs and ongoing government operations to 
invest in a fund. There is no budget surplus that could be redirected 
to an oil fund without shortchanging other priorities, such as standing 
up security forces, maintaining key infrastructure, and making the 
necessary investments in the oil section to fuel future Iraqi growth. 
Moreover, case studies show that such funds rarely improve fiscal 
operations or transparency in countries with challenged institutions 
and a history of breaking fiscal rules. In such cases, oil funds are 
generally more likely to reflect the problems of the fiscal system they 
are created from. Iraq's fiscal deficits and management shortcomings 
strengthen the need to remain engaged with the Iraqi Government on 
transparency, revenue sharing, and other anticorruption and good 
governance efforts, as planned under the U.S. assistance program.

                     IRAQ: INTERNATIONAL ASSISTANCE

    Question. According to Ambassador Jim Jeffrey's February 8 
testimony to the SFRC, the international community has only obligated 
an additional $200 million since September 2005.

   How do you explain the failure of the international 
        community to better meet its pledges to assist Iraq? Please 
        describe any further obligations that you expect will occur by 
        other countries in the coming 6 months.

    Answer. The international community has already disbursed about 
$3.3 billion of the $13.6 billion pledged to Iraq in Madrid pledges in 
late 2003. Most of those pledges, made in late 2003, were to be 
disbursed over the 4-year period of 2004 to 2007. They are thus still 
in the process of disbursal.
    Many of the pledges are in the form of loans, and have taken longer 
to disburse because loan agreements must be negotiated with the Iraqi 
Government. Japan, the second largest donor after the United States, 
has already disbursed all of its Madrid pledge of $1.54 billion in 
grant aid, and we understand that it is close to finalizing the first 
of its loan agreements from its $3.5 billion in pledged concessional 
loans.
    The United Kingdom is also well along in disbursal of its $452.3 
million Madrid pledge, having disbursed $300 million by the end of 
February.
    The new obligation since September 2005 that you refer to in your 
question is related to the European Commission's announcement of an 
additional 200 million euros for 2006. Due to its budgetary process, 
the EC pledged year by year for Iraq--200 million euros each year for 
2004, 2005, and 2006. Its 2004 and 2005 pledges have already been fully 
disbursed.
    In November 2005, the World Bank approved a $100 million loan for 
Iraq, its first loan for that country in 30 years, representing the 
first part of its Madrid pledge. The International Monetary Fund signed 
a $485 million Emergency Post Conflict Assistance (EPCA) loan in 2004, 
and a $600 million standby arrangement with Iraq in December 2005.
    We are working with the Iraqis to encourage other donors to 
accelerate their pledge disbursals. We are not aware of any specific 
plans by other donors for new pledges for Iraq, but we will support the 
new Iraqi Government as it seeks new assistance.
    International partners have also extended considerable debt relief 
to Iraq. In the historic November 2004 Paris Club agreement, and 
largely due to strong U.S. support, sovereign creditors agreed to 
forgive 80 percent of Iraq's debt in three phases. Nearly all Paris 
Club creditors have now formalized their accords with Iraq, and we 
expect the remaining ones to do so in the coming 6 months. Three non-
Paris Club sovereign creditors have also matched or exceeded Paris Club 
terms, and we are supporting the Iraqi Government as it seeks to obtain 
debt relief from other non-Paris Club creditors. Key gulf creditors 
have assured us and the IMF that they would offer debt relief to Iraq 
on at least Paris Club terms, and Iraqi authorities indicate they will 
approach these creditors in the coming months to discuss such debt 
relief.

                        U.S. FOREIGN ASSISTANCE

    Question. Why shouldn't the Director of Foreign Assistance be a 
Senate-confirmed position?

    Answer. I have undertaken the current reforms as part of an effort 
to use existing authorities for maximum effectiveness. Under my 
guidance, the Director of Foreign Assistance (DFA) will systematically 
evaluate our progress and he will use this evaluation to identify any 
further changes that might be appropriate. We very much look forward to 
working with Congress going forward to evaluate the appropriateness of 
the tools currently available to improve the effectiveness of foreign 
assistance.

    Question. Under existing law, does the Director of Foreign 
Assistance have the authority to make all decisions regarding foreign 
assistance from State and USAID?

    Answer. To the extent permitted by law, I will delegate to the DFA 
the foreign assistance funding authorities consistent with, and 
necessary to achieve, a single coordinated foreign assistance approval 
authority. Under my direction, the Director of Foreign Assistance will 
have approval and coordinating authority over all foreign assistance.

    Question. Please describe any further changes, including 
legislative changes, that the administration plans to implement on U.S. 
foreign assistance.

    Answer. As I stated in announcing the new leadership position, the 
current structure of America's foreign assistance risks incoherent 
policies and ineffective programs and perhaps even wasted resources. We 
must align our activities more fully across the State Department and 
USAID and within the State Department itself so that we are better able 
to achieve our goals and can be better stewards of public resources. A 
driving purpose behind my decision to establish the Office of the 
Director of Foreign Assistance, therefore, is to apply a more 
strategic, results-oriented, and long-term view to the use of foreign 
assistance funding. As we evaluate the efficacy of this reform, we look 
forward to consulting with the Congress and discussing the need for 
further reform, if any.

                 SECURITY ASSISTANCE AUTHORITY FOR DOD

    Question. On July 19, 2005, you and Secretary Rumsfeld sent a 
letter to the Hill asking Congress to give the Defense Department 
permanent statutory authority to disburse military security assistance. 
Please explain to the committee how giving DOD this authority is 
consistent with your effort to create a more unified and rational 
leadership structure overseeing U.S. foreign assistance.

    Answer. The Department of State supports this new authority because 
it would augment the resources and authorities available to the 
President to act quickly when unforeseen events make the initiation or 
expansion of a training, equipping, or advisory program necessary. In 
addition, I am able to lend my continued support because the statute 
stipulates that State and DOD shall jointly formulate the execution of 
train and equip programs.
    I look forward to working with Congress to develop the flexible 
tools we need to win the global war on terror without compromising 
State's primacy in foreign assistance.

                    NORTH KOREA: FINANCIAL SANCTIONS

    Question. How much hard currency does the North Korean regime 
receive from its counterfeiting operations? (If necessary, please 
provide a classified answer to respond fully.)
    How much do you estimate that the financial sanctions against the 
Banco Delta Asia Bank (suspected of laundering the counterfeit U.S. 
currency produced by North Korea) have cost the North Korean regime? 
(If necessary, please provide a classified answer to respond fully.)

    Answer. The responses to these questions are classified and are 
retained in the committee's secure safes.

                            ENERGY SECURITY

    Question. What is your and the State Department's role in 
addressing U.S. energy security interests?

    Answer. The objective of our energy policy is to ensure that our 
economy has access to energy on terms and conditions that support 
economic growth and prosperity. We must also ensure that the United 
States can pursue its foreign policy and national security interests 
without being constrained by energy concerns. In addition, our policies 
must also be consistent with America's broader economic and foreign 
policy goals and complement domestic policy initiatives.
    To this end, the State Department:
          1. Promotes the diversification of energy supplies, 
        worldwide;
          2. Works with other oil consuming countries to respond to 
        supply disruptions, particularly through the coordinated use of 
        strategic petroleum stocks;
          3. Encourages major oil producing countries to maintain 
        responsible production policies to support a growing world 
        economy and to reduce oil market price volatility; and
          4. Works with other countries to reduce global dependence on 
        oil, including through conservation, efficiency, and through 
        the development of alternative sources of supply.

    Question. Do recent events on energy security such as Russia's role 
as a supplier to Europe, developing Central Asian reserves; the rising 
energy demands in Asia have foreign policy implications?

    Answer. Yes. Russia is a country of tremendous natural resources. 
Expanding oil and gas production, particularly in remote regions like 
eastern Siberia, to meet domestic needs and fulfill export contracts 
will be a major challenge for Russia in years to come. Russia could 
become a major supplier of liquefied natural gas to world markets over 
the next few decades. Energy production in the Caspian region is on the 
rise; like Russia, Caspian producers, especially in Central Asia, will 
have to improve transport options to get their products to market. 
Those options may run west, south, or east--to traditional markets in 
Europe or to meet new demand in India and China. Energy efficiency and 
conservation also remain major challenges for the former Soviet sphere, 
particularly in Russia and Ukraine.
    We are encouraging Russia to improve its investment climate, work 
constructively with foreign companies to enhance production and 
transport mechanisms, and lean on its companies to engage in 
transparent, market-based activities. Given surging demand, especially 
in Asia, incremental, non-OPEC production, such as that in Russia, will 
be very important in the global market. In Central Asia and the 
Caucasus, we will also promote foreign investment, and encourage 
regional governments to work together to expand and diversify pipeline 
routes. Russia has identified energy security as a major focus for the 
G-8 Summit in St. Petersburg, which President Putin will host in July.
    Europe remains a net importer of energy; two-thirds of the EU's 
total energy requirements will be imported by 2020. The EU currently 
imports 30 percent of its gas from Russia. Bickering between Russia and 
Ukraine over natural gas supply and transit, which led to temporary 
disruptions in supply over New Year's, spurred European leaders to 
refocus their attention on energy security, and in particular to 
reevaluate options to diversify sources of energy imports and adopt new 
energy-saving technologies.
    We will work closely with our European allies, as well as engage 
Russia and its neighbors, to advance our energy agenda: To ensure that 
our economy has access to energy on terms and conditions that support 
economic growth and environmental stewardship. Energy is a critical 
issue for our friends in Europe, and the European Union is helpfully 
focusing on a need for common approaches to shared energy challenges. 
At the same time, we will strive to bolster energy security across the 
European Continent and EurAsia region. President Bush's Advanced Energy 
Initiative outlined U.S. efforts to develop alternative sources of 
energy and reduce foreign dependence. The United States and Europe were 
already collaborating on hydrogen, clean coal, renewable energy, 
nuclear fusion, and clean transport. With the State of the Union 
providing further guidance, we will redouble our efforts, and extend 
them into the CIS.
                                 ______
                                 

                   Questions of Senator Richard Lugar

                    TROPICAL FORESTS AND CORAL REEFS

    Question. Senator Biden and I recently reauthorized funding for the 
Tropical Forest Conservation Act, which we authored. The Department's 
budget request cuts funding for TFCA. How many dollars and how many 
projects are ``in the pipeline'' for TFCA? How difficult is it for the 
Department to encourage other governments to comply with all the 
governance conditions of TFCA?

    Answer. The administration has a significant amount of TFCA funding 
remaining from earlier appropriations. According to the Treasury 
Department, approximately $60 million in TFCA funding remains in the 
Treasury Debt Restructuring Account. About $30 million of this amount 
has already been allocated to countries that have been declared 
eligible for TFCA.
    For the remaining funds, we are examining the possibility of TFCA 
programs with other countries. However, we cannot say with certainty at 
this time whether countries that have applied for TFCA treatment will 
be declared eligible under the criteria set forth in the act, or 
whether countries with whom we are in preliminary informal discussions 
will decide to apply for TFCA treatment. We anticipate that the amount 
already on hand, together with any amounts the administration may 
decide to allocate to TFCA from the FY07 budget, will be sufficient in 
the near term.
    We believe the political and economic eligibility criteria set 
forth in the TFCA are useful in identifying countries with a commitment 
to good political and economic policies--policies that are necessary 
for the successful administration of long-term programs like TFCA. 
However, we note that a number of countries expressing interest in TFCA 
have not met one or more of the eligibility criteria.

    Question. There has been criticism that debt relief programs like 
TFCA ``encourage bad behavior'' in developing countries. Has the 
Department under review other approaches to protecting tropical rain 
forests, and other critical ecosystems like coral reefs?

    Answer. We understand that there are sometimes concerns that debt 
relief programs run the risk of encouraging irresponsible borrowing in 
that borrowers may expect future loans to be forgiven as well. We do 
not believe this is a problem with TFCA, which is a small, selective 
program that deals only with concessional debt incurred before January 
1, 1998. In addition, TFCA can be described more properly as debt 
redirection rather than debt relief. Under TFCA, the borrowing country 
is still required to make payments in local currency for tropical 
forest protection that are roughly equivalent in most cases to what 
they would have repaid to the USG under the original debt obligation.
    The administration considers TFCA an innovative approach to 
conserving tropical forests that complements our bilateral and 
multilateral activities. For example, USAID routinely provides grant 
assistance to eligible developing countries to support forest 
protection and sustainable management, including protection of 
biodiversity. USAID support in this area has been augmented recently 
through two innovative initiatives: (1) The Congo Basin Forest 
Partnership, a multidonor public-private partnership launched by the 
Department in 2002, to which we are contributing $54 million over 4 
years through USAID's Central African Regional Program on the 
Environment (CARPE), and (2) the Amazon Basin Conservation Initiative, 
which was initiated in 2005 and focuses on conserving biological 
diversity in the world's largest intact tropical forest.
    Through our contributions to international organizations and 
financial institutions such as the International Tropical Timber 
Organization, the Food and Agriculture Organization of the United 
Nations and the Global Environment Facility, the United States supports 
a wide range of projects in tropical countries designed to protect, 
conserve, and sustainably manage their forests.
    The USG, primarily through USAID, also provides about $20 million 
annually to programs that benefit coral reef ecosystems in Meso-
America, the Caribbean, and Southeast Asia. The Department recently 
established an Environmental Regional Hub in Fiji in order to enhance 
our coral reef conservation activities in the Pacific Islands. In July 
2007, the USG will assume the cochair with Mexico of the International 
Coral Reef Initiative which the Department launched in 1993, giving us 
another platform to promote coral reef conservation worldwide.

    Question. Is it your view that, if more money were available for 
nonproliferation, counterproliferation, and weapons dismantlement 
programs, you would be able to eliminate more threats faster and that 
this would be in U.S. national security interests?

    Answer. I support the President's budget, which supports our 
national security goals in all respects, not just in 
counterproliferation and weapons dismantlement programs. These are a 
vitally important element of our foreign assistance mix, but so are 
also our efforts to strengthen our diplomacy and build democracy in 
places where it is weak or absent. Within the parameters of the 
President's FY 2007 request, I will work to allocate funds to enable 
the United States to develop and refine sensible security measures, 
such as furthering our Proliferation Security Initiative and enhancing 
the ability of those who cooperate with us to deny to regimes like 
Iran, North Korea, as well as nonstate actors, including terrorist 
groups, the materials for covert weapons programs that threaten the 
international system.

    Question. As you know, we have been working with the Department to 
update legislation that Senator Biden and I wrote to give statutory 
standing and needed personnel authorities to the Department for the 
Office of Reconstruction and Stabilization. We asked for the 
Department's views and support for the legislation a month ago. How 
soon can we have your view on this legislation?

    Answer. The Department appreciates the continuing focus on these 
issues that you and your committee have shown. The legislation provides 
many useful personnel and funding authorities that would enhance the 
ability of the Department and its partners in other agencies to respond 
more rapidly and effectively.
    In addition to our earlier discussions on the State authorization 
bill, our staff will continue to work with you to provide additional 
information.

    Question. U.S. bilateral and multilateral energy discussions are, 
for the most part, run through the Energy Department. Yet the issue of 
energy security must be a paramount foreign policy consideration of the 
United States. How do you propose that the State Department incorporate 
energy security into its core mission?

    Answer. The United States imports almost two-thirds of its oil, and 
our energy security is inextricably linked with developments that occur 
overseas. We rely on the private sector to find, produce, and 
distribute oil and refined products. However governments also have key 
roles:
          (1) We need to minimize political constraints that may 
        inhibit the smooth functioning of global energy markets, and
          (2) We have to ensure that we are free to pursue our broader 
        foreign policy objectives without undue concern over the 
        possible impact on our country's energy supplies.
    The State Department deals with these issues in a number of ways.

   We work with the Department of Energy and the International 
        Energy Agency to maintain strategic petroleum stocks in 
        consuming countries, and to coordinate their release in 
        response to a supply disruption. This most recently occurred in 
        response to Hurricanes Katrina and Rita last fall.
   We engage with producing and consuming countries to try to 
        ensure the smooth functioning of energy markets worldwide.
   We provide diplomatic support to private sector efforts to 
        open up new sources of energy supply, such as in the Caspian 
        region.
   More broadly, the goal of energy security is closely tied to 
        our efforts to work for regional security and economic 
        development in many parts of the world.

    Question. On November 17, 2003, President Bush transmitted the 
Council of Europe Convention on Cybercrime to the Senate for its advice 
and consent. The Foreign Relations Committee held a hearing on the 
convention in 2004. In July of last year, by voice vote the committee 
ordered the convention reported to the full Senate, with a 
recommendation that the Senate give its advice and consent to 
ratification. The Senate has yet to act on the convention.
    Does the administration continue to support U.S. ratification of 
the Cybercrime Convention? How important is this convention in your 
view?

    Answer. Yes, the administration continues to strongly support U.S. 
ratification of the Convention on Cybercrime.
    The Convention on Cybercrime is the only multilateral treaty to 
address the subject of crime committed against and using computer 
systems. It provides important tools for U.S. investigators and 
prosecutors in their work to prevent and combat terrorism and organized 
crime, and for protecting the Nation from terrorist attacks and attacks 
on critical information infrastructure. It is also essential to 
securing the international cooperation we need to enforce our criminal 
laws, including those against piracy of intellectual property and 
purveying child pornography.
    The convention provides all of these benefits to the United States 
without requiring any change to U.S. law, including to the protections 
guaranteed under the U.S. Constitution. No country could use the 
convention to force the United States to do an investigation or give 
evidence when to do so would transgress our well-established 
protections of free expression and freedom of religion.
    A number of coalitions of U.S. businesses, including businesses in 
the information technology, Internet, and content provider fields, have 
expressed their strong support for U.S. ratification of the convention. 
They believe it would not only improve the security of the United 
States, but also help address the global problem of Internet crime, 
such as the spreading of viruses and worms, phishing attacks, and 
identity theft.
    The Attorney General recently wrote to the Senate majority and 
minority leaders to reaffirm the administration's strong support for 
the convention. I join him in urging the Senate to act quickly to give 
its advice and consent to ratification of this important instrument.

    Question. It is not a national flaw that our hopes for a peaceful 
world exceed our ability to provide for it. Your leadership in taking a 
hard new look at foreign assistance is welcome. Can you describe your 
philosophy in making the kinds of tradeoffs that ultimately have to be 
made? For example, how do you weigh the value of MCC assistance to 
well-governed poor countries versus assistance to nations that are 
strategically important in the war against terrorism? How do you 
provide assistance to failed and failing states when the reason they 
are failing is that they have corrupt and ineffective governments? What 
about regional tradeoffs--the importance of boosting former Soviet 
States in their lean toward the West versus the need to influence 
nations with significant Muslim populations? How do you prioritize our 
foreign assistance goals?

    Answer. Assuring U.S. national security, both physical and 
economic, immediate and long term, is our top foreign policy priority. 
It is the prerequisite to our freedom and prosperity. But our security 
interests cannot be achieved apart from our development goals and our 
democratic ideals in today's world. Our assistance must integrate and 
advance all of these goals together.
    Accordingly, the primary objective of our assistance is to build 
and sustain democratic, well-governed states that will respond to the 
needs of their people and conduct themselves responsibly in the 
international system. In the near term we must give priority to nations 
that are strategically important in the war against terrorism. The 
largest single piece of our 2007 foreign assistance budget request is 
to strengthen our coalition partners on the front lines in the fight 
against terrorism.
    Over the longer term, to secure freedom and prosperity both at home 
and abroad, we must provide real incentives to poor countries that 
demonstrate commitment to ruling justly, investing in their people, and 
promoting market freedoms. The Millennium Challenge Account has already 
shown that it is a powerful incentive, one that provides hope by 
promoting sustainable economic growth to reduce poverty in the poorest 
counties. ``Getting incentives right'' is one of the key lessons of 
development economics over the last 50 years, and it explains why the 
MCA is so important.
    In the case of states that have failed or are failing because of 
corrupt and ineffective governments, we must insist on transformation 
as a condition of any assistance to their governments. We are 
requesting funds to meet humanitarian needs, lay the foundations for 
economic development, and strengthen sustainable democratic 
institutions in countries such as Sudan and Haiti.
    Regionally, many areas of the world remain vulnerable to 
authoritarian, despotic, and corrupt rulers--whether in former Soviet 
States, the Middle East, or elsewhere. We cannot afford to ignore any 
region. Nonetheless, we recognize the special importance of helping 
countries overcome the legacy of Communism and the appeal of political 
Islamist ideology. For this reason, we continue to provide funding 
under the Freedom Support Act to promote the rule of law and the growth 
of democratic and market institutions in countries that just 15 years 
ago lived under totalitarian Soviet rule. We also place high priority 
on helping the nations of the Broader Middle East to make progress in 
building the foundations of democratic societies, for example, through 
the Middle East partnership initiative.
    As you note, prioritization of our foreign assistance goals is a 
complex process, which must balance all of these and many other 
critical issues such as post-disaster humanitarian relief and global 
health threats. In making such decisions, we must consult widely, not 
only within the Department but also with other agencies, to ensure that 
the decisions are as well informed as possible. Other than assuring the 
national security of the American people as our top priority, there are 
no absolutes, but rather a careful balancing of a wide variety of 
policy goals and assistance tools.

                           FOREIGN AID BUDGET

    Question. What relationship will the new Director of Foreign 
Assistance have with the Assistant Secretaries and Coordinators at the 
State Department and Assistant Administrators at USAID who currently 
have responsibility for designing and implementing foreign assistance 
programs? Who will control the funds that are currently apportioned to 
those individuals? How will the decisionmaking process work?

    Answer. I am establishing the position of Director of Foreign 
Assistance (DFA) to better align our foreign assistance programs with 
our foreign policy goals, to align more fully the foreign assistance 
activities of USAID and State, and to demonstrate that we are 
responsible stewards of taxpayer dollars. I intend to delegate to the 
DFA authority over foreign assistance funding and programs to achieve 
these goals, not to supervise Assistant Secretaries and Coordinators or 
Assistant Administrators. Nor are the reporting relationships of 
Assistant Secretaries or Assistant Administrators expected to change. 
Instead, the Director of Foreign Assistance will work closely with 
Assistant Secretaries and Assistant Administrators in exercising his 
authority over foreign assistance funding and programs and developing 
coordinated strategies, plans, and budgets. Under my direction, the DFA 
will have approval and coordinating authority over all foreign 
assistance.

    Question. What role will the Director of Foreign Assistance assume 
with respect to the myriad other agencies that currently provide 
foreign assistance, including the MCC? Will the administration 
establish a formalized coordination structure with you at the helm? How 
will you ensure that State/USAID programs are not being run at cross-
purposes with DOD, Justice, Labor, MCC, etc.?

    Answer. The Director of Foreign Assistance is intended to provide 
overall leadership to foreign assistance that is delivered through 
other agencies and entities of the U.S. Government, such as the 
Millennium Challenge Corporation (MCC). By instituting integrated 
country strategies and operating plans, the Director of Foreign 
Assistance will help ensure that USG agencies delivering foreign 
assistance are not working at cross-purposes, that, in fact, we are 
taking advantage of agencies' comparative strengths to create a U.S. 
Government program that is effective and makes the most efficient use 
of taxpayer dollars. With respect to other U.S. Government agencies, 
including the MCC, the Director of Foreign Assistance will work in 
concert with these agencies to address the pressing issues that face 
developing countries and to ensure that programming is complementary 
and stove-piping is curtailed.

    Question. How many people do you envision will work in the Office 
of the Director of Foreign Assistance? What capabilities/
responsibilities will they have? How many such individuals will be new 
hires as opposed to being pulled from current positions within State 
and USAID? To what extent will you have input into the hiring, 
training, and assignment process at State and USAID to ensure 
appropriate expertise is developed at these two agencies?

    Answer. To implement foreign assistance effectively, the United 
States must have the right people, with the right skills, in the right 
place at the right time. With regard to staff needs for the Director of 
Foreign Assistance, I intend for this Office not to be duplicative, but 
instead to add value to the current environment. I anticipate an office 
that, when fully staffed, will bring together something in the range of 
50 to 100 positions, based on bringing together existing staff who are 
performing common foreign assistance functions in the two 
organizations. The DFA will consult with, and provide a full 
notification to, Congress once we have made the necessary decisions 
about how to best utilize these existing functions. As the Director of 
Foreign Assistance and I define strategic priorities and develop 
comprehensive country plans, we will consider whether our human 
resources align with program priorities and resource availability.

    Question. Some supporters of the restructuring believe it does not 
go far enough and that the administration has missed an opportunity to 
launch a much more ambitious and necessary reform effort. Does this 
restructuring mark the first step toward a future and bolder reform 
effort?

    Answer. I have undertaken the current reforms as part of an effort 
to use existing authorities for maximum effectiveness. Under my 
guidance, the Director of Foreign Assistance will systematically 
evaluate our progress and use this evaluation to identify any further 
changes that might be appropriate. We very much look forward to working 
with Congress going forward to evaluate the appropriateness of the 
tools currently available to improve the effectiveness of foreign 
assistance and to determine whether further reforms may be necessary.

    Question. Please comment on the concerns that some have expressed 
that the new initiative may lead to a greater degree of aid 
politicization in which long-term development and poverty reduction 
goals will be overwhelmed by the demands of shorter term strategic 
considerations. To what degree will USAID remain influential in shaping 
U.S. development policy?

    Answer. A driving purpose behind my decision to establish the 
Office of the Director of Foreign Assistance is to establish mechanisms 
to promote a more strategic allocation of our foreign assistance funds, 
targeted to specific results. Strengthening the U.S. Government's 
commitment to long-term, results-oriented development will require the 
unique talents and voices of both State and USAID. Coherent, 
comprehensive, multiyear strategies will replace fragmented 
programming, and the United States will promote greater ownership and 
responsibility on the part of host nations and their citizens. As with 
the strategy that Ambassador Tobias employed as U.S. Global AIDS 
Coordinator, U.S. Government assistance must address immediate needs 
and crises, while at the same time laying the foundation for long-term 
sustainability under the leadership and responsibility of host nations.

    Question. In your initiative to implement transformational 
diplomacy, you identified several ways in which Foreign Service 
Officers will be affected, in terms of training, skills, and 
assignments. Will these same changes also apply to USAID staff, 
especially those posted overseas?

    Answer. To implement foreign assistance effectively, the United 
States must have the right people, with the right skills, in the right 
place at the right time. A key advantage of these reforms is the 
ability to bring all strengths and resources of the United States to 
bear in achieving foreign policy goals.
    My vision is to ensure that our diplomatic corps and other human 
resources are prepared to take on the challenges we face today. In some 
cases, that may require new or additional skills and capabilities, 
including in areas such as strategic and program planning, procurement, 
and monitoring and evaluation. Just as we seek to apply a strategic 
approach to the implementation to foreign assistance, strategic 
approaches underway for the allocation of operational and human 
resources must continue.
    USAID operates in some of the most difficult circumstances in the 
world where having adequate resources are critical for implementing 
successful programs.

                    STABILIZATION AND RECONSTRUCTION

    Question. Your commitment to devote 15 new slots to the Office of 
Reconstruction and Stabilization will bring the number of people in the 
Office up to about 100. Do you believe that there is now enough 
critical mass to establish the active-duty response corps that is 
called for in our legislation? How have your experiences in staffing 
positions in Afghanistan and Iraq affected your view of the need for 
such a corps?

    Answer. Additional FTE appropriated to S/CRS will be used to 
regularize existing staff positions that are currently not permanent, 
but provided through temporary arrangements. The current staffing 
within the Office is 48 State personnel and 12 interagency detailee 
positions. There are already 6 members of the Active Response Corps in 
initial training and all 15 will be on board by summer. They will 
participate in training, military exercises, and planning and will be 
available for deployment.
    A truly ``active'' ARC requires dedicated funding so that the 
Department can create separate permanent positions to ensure 
availability of staff to plan, prepare, and deploy. Without sufficient 
overall staffing levels for the Department, it will not be possible for 
the ARC to expand.
    Experiences in Iraq, Afghanistan, and elsewhere have demonstrated 
the need for training and preparing staff in advance through training, 
military exercises, and planning. Having staff available who have 
committed in advance, and are prepared to deploy, ensures more rapid 
mobilization of the right skillsets.

    Question. In your recent Georgetown speech, you said: ``We have an 
expansive vision for this new office, and let there be no doubt, we are 
committed to realizing it.'' How does your budget request shore up that 
statement? How much funding did the Department devote to operations of 
the Office in the 2006 budget? What do you envision for 2007?

    Answer. The following table outlines S/CRS funding for FY05 and 
FY06, as well as our FY07 request.

                         [Dollars in thousands]
------------------------------------------------------------------------
                                                    FY06         FY07
             Account               FY05 actual    estimate     request
------------------------------------------------------------------------
FY05 Supplemental Operating             $7,700  ...........  ...........
 Funds*..........................
Bureau-Managed Operating Funds...       **$737       $6,237       $6,507
Cost of Permanent Positions             $1,485       $2,475       $5,250
 Funded..........................
    (total FTE)..................          (9)         (15)         (30)
Cost of other State non-permanent       $2,950       $7,920       $8,400
 staff...........................
    (total positions; includes            (22)         (48)         (48)
     Active Response Corps)......
                                  --------------------------------------
      S/CRS total (State               $12,872      $16,632      $20,157
       Operations--D&CP).........
Conflict Response Fund (Foreign              0            0      $75,000
 Ops)............................
------------------------------------------------------------------------
* Supplemental provided 2-year funding; $2.6M obligated in FY05 and
  $5.1M in FY06.


    Question. As you may know, we have updated the legislation giving 
this Office statutory standing and will be working to have that pass 
the full Senate as free-standing legislation. It authorizes both a 500-
person reserve component and a 250-person active-duty component of a 
Readiness Response Corps at the Department. Can you describe your 
current thinking on how you would use this new authority?

    Answer. We currently have sufficient authority to create a standing 
response corps within the Department. We will be requesting the 
necessary resources in FY 2008 and later to staff the Readiness 
Response Corps as requirements become further defined. Currently, we 
have a standby response corps that has helped identify from within the 
Department and retirees, those who may be interested and ready to 
deploy or to provide surge capacity within State in a crisis but who 
would continue to work in other positions until needed.
    We are requesting some funding in FY 2007 to begin the development 
of a Civilian Reserve that would draw on nongovernmental skillsets to 
provide the USG a standing corps of trained and preidentified employees 
who can deploy rapidly and fill key sectoral gaps in rule of law and 
security.

   There are several components of staffing requirements:

     S/CRS core management staff;
     Department of State surge capacity--Active and Standby 
            Response Corps;
     Other agency surge capacity;
     On-call Civilian Reserve;
     Implementing partner capacity (Global Skills Network of 
            contracts, NGOs, grantees).

   S/CRS has estimated a need for a core staff of 80 to provide 
        leadership and management of integrated USG planning and 
        response and to manage development of comprehensive and 
        interoperable civilian capabilities.
   Current staffing is a combination of permanent, 
        nonpermanent, interagency detailees, and temporary staff.
   We need to institutionalize a standing capability that will 
        ensure lessons learned are lessons applied. Our long-term plan 
        is to convert nonpermanent staffing to permanent and be able to 
        reimburse agencies for detailees; both will ensure that we are 
        able to attract and retain the best employees.
   S/CRS estimates a need for 100 members of an Active Response 
        Corps to provide the Department with a separate cadre of 
        rapidly deployable, trained, and exercised personnel who can 
        augment Embassy operations, manage initial field engagements, 
        participate in the added workload of preparing plans for 
        response, and embed with military forces if deployed. While not 
        deployed, they will train, exercise, and work within bureaus to 
        build capacity for response and address conflict issues.
   Current funding provides for an initial 15 members of an 
        Active Response Corps in FY06 (all will be onboard by summer).
   In addition, there is a need to access additional personnel 
        within State through a Standby Response Corps made up of 
        individuals who have expressed interest in deployments or to 
        surge into domestic efforts. This SRC has been identified.
   Other agencies also have, or are augmenting, their internal 
        surge capacity to be able to respond to demands for their 
        expertise and program management capabilities.
   A Civilian Reserve system that would provide readily 
        available outside experts to serve in USG missions does not 
        exist. We propose to build such a system initially focused on 
        the need for rule of law personnel who have advance training 
        can be called up within weeks and deployed.
   Existing implementation capabilities in State and USAID and 
        other agencies is frequently carried out through contractors, 
        NGOs, and grantees. There is a need to strengthen and widen 
        those capabilities across the USG to ensure adequate capacity.

    Question. Although the administration's FY 2006 request for the 
creation and funding of a Conflict Response Fund was not included in FY 
2006 Foreign Operations appropriations, funding authority for the 
transfer of up to $100 million for the purposes of the fund was 
provided in the DOD authorization act (sec. 1207, Public Law 109-162). 
Have you requested, or do you intend to request, such a transfer from 
the Secretary of Defense? If so, for what purposes?

    Answer. We are currently working to develop proposals for use of 
the funding and have worked with DOD on the process for requesting a 
transfer. We believe that having a ready pool of resources to address 
conflict transformation priorities will provide a valuable tool in 
addressing emerging needs in conflict situations. Our goal will be to 
support ongoing planning efforts undertaken by S/CRS, to respond to 
unforeseen needs, and to build capacity to respond to conflict.

    Question. S/CRS and Joint Forces Command have requested a study 
from the Institute for Defense Analysis on the potential costs of the 
civilian response corps that you envision S/CRS as creating. What has 
the administration learned from that study about the potential costs of 
such a corps? How do you respond to concerns that the expansion of a 
civilian corps to carry out these activities will promote ill-
considered interventions?

    Answer. The IDA study was a good start in providing valuable 
information on civilian surge capabilities of other organizations, 
including their estimated costs. We used such information and lessons 
from previous engagements to develop our own concept for establishing a 
civilian reserve. The conclusion from outside and internal experts, is 
that a standing capacity that can be readily accessed and which has 
high degree of preparation and reliability will be needed. Assumptions 
we used to define the legislative, management, and budgetary 
requirements for creating the concept are now being validated through a 
comprehensive management study that S/CRS has contracted to an outside 
firm. This study will address how to manage the reserve system 
including recruiting, hiring, and preparation.
    Having the capacity to respond quickly and effectively will make 
U.S. engagements more successful. The USG will respond to national 
security challenges based on our interests, the important difference 
will be that we will have additional civilian tools to complement our 
military assets.

    Question. The budget request contains $11 million for preventive 
activities. This appears to be the first request for such a category of 
assistance in the State Department budget. In what countries and 
circumstances do you believe this will be used?
    How will such activities be coordinated with possible USAID 
activities for the same purpose?
    Has the State Department developed measures that would help assess 
whether preventive programs can actually forestall conflict and result 
in budget savings through the adoption of a policy of preventive 
diplomacy rather than dealing with conflicts after they erupt?

    Answer. The FY 2007 request includes $11 million in Economic 
Support Funds (ESF) for Reconciliation Programs, a slight increase over 
the administration's request in FY 2006. This is not a new program. In 
fact, Congress earmarked ESF for reconciliation programs in FY 2004. 
USAID's Office of Conflict Management and Mitigation, with State's 
Bureau of Democracy, Human Rights, and Labor, oversees the programs. 
They are currently funding 21 ongoing programs in the Democratic 
Republic of Congo, Nepal, Sri Lanka, Ethiopia, Mali, Burundi, Angola, 
Bolivia, Colombia, Yemen, Israel and the West Bank/Gaza. Since FY 2004, 
several additional countries were made eligible including Guinea, 
Kosovo, Morocco, Russia (Northern Caucasus only), Rwanda, and Uganda. 
Each year, before releasing a call for proposals, the country list is 
reviewed and revised in light of country need, foreign policy 
priorities, and the potential for real program impact.
    This competitively awarded fund is used to support reconciliation 
programs and activities that bring together individuals of different 
ethnic, religious, or political backgrounds from areas of civil 
conflict and war in order to address the root causes of conflict. 
Programs that include mediation of specific disputes, mechanisms for 
restorative justice, dialogue, and training for conflicting parties or 
support of peace processes are examples of the types of activities that 
will be considered. Programs that bring together conflicting parties in 
an effort to implement practical solutions to specific conflict issues 
(e.g., land use, unemployment, and natural resources management) are 
most likely to receive support under this fund.
    The funds made available under this earmark frequently complement 
ongoing conflict mitigation activities in the field funded by USAID 
including the Office of Conflict Management and Mitigation. Funded 
proposals must demonstrate complementarity rather than duplication.
    Every program implemented under the reconciliation fund is designed 
with monitoring and evaluation plans that enable USAID to assess the 
results of the program as measured against its stated goals and 
objectives. These evaluation plans are assessed by the proposal review 
committee to ensure that they adequately measure project impact. Sample 
indicators that help measure progress in the prevention of violent 
conflict are: The number of trained leaders demonstrating ability to 
guide communities through divisive issues; number of land-related 
conflicts successfully mediated; increased participation of community 
members in multiethnic activities, meetings, and events by the end of 
the program; and community members negotiate the establishment of 
truces and safe zones in areas of conflict.

                              AFGHANISTAN

    Question. Though the Taliban has been removed from power and most 
al-Qaeda elements have been driven out of Afghanistan, last year marked 
the most violent year since 2001. Indications are that the security 
situation is unlikely to improve and may even deteriorate in 2006. Will 
the intended transition to a NATO/ISAF-led security sector for the 
entirety of Afghanistan adequately meet U.S. and Afghan interests in 
stability and counterterrorism?

    Answer. We are concerned about the increased violence and use of 
suicide attacks and improvised explosive devices (IEDs) and are working 
closely with Afghan security and intelligence forces to counter these 
threats. Indeed, Afghan forces have thwarted a number of suicide 
attacks.
    President Karzai has condemned these attacks as have provincial 
government and religious leaders. In addition, Afghans--who have been 
the primary target of the attacks--have staged protests against suicide 
bombings. Relying on suicide attacks will further alienate the Taliban 
from the vast majority of the Afghan people.
    NATO forces are up to the challenge. The NATO-led International 
Security Assistance Force (ISAF) is expected to expand to southern 
Afghanistan by fall 2006. As it expands from its current area of 
responsibility in the north, west, and in Kabul, ISAF will enter a more 
challenging security environment. To meet those challenges, NATO has 
updated its operations plan and rules of engagement. We are confident 
that those rules give NATO commanders the robust and flexible framework 
they need to carry out ISAF's mission in the south.

    Question. Responsibility for train and equip programs in 
Afghanistan has shifted from the State Department to the Defense 
Department. Is DOD carrying out this program under the supervision of 
the U.S. Ambassador? Has the State Department been able to retain 
influence over the program? How responsive are DOD personnel to 
political concerns expressed by State Department personnel?

    Answer. The Chief of Mission has policy responsibilities for all 
USG programs in Afghanistan and coordinates closely with the Office for 
Security Cooperation--
Afghanistan (OSC-A) which is responsible for reform of the security 
forces including the ANP. The Ambassador and the CFC-A Commander work 
very closely together to monitor all aspects of the ANA and ANP's 
development, and there is strong interagency cooperation and 
coordination between DOD and State on this program. DOD provides 
biweekly briefings on the status of the ANA and ANP to the Department 
of State and briefs the Afghanistan Interagency Operating Group (AIOG) 
on the status of the ANA and ANP and funding.
    In FY 2005, the State Department provided significant funding, 
including $396.8M in FMF funds to train and equip the ANA, $945K in 
IMET funds, and $15.5M in PKO funds for salaries. Congress also 
provided $795M in FY 2005 supplemental funds to the Department of 
Defense through the Afghan Security Forces Fund (ASFF) to support ANA 
train and equip requirements, which also support ANP activities 
(including $200M in FY 2005 supplemental). The FY 2006 budget includes 
$792K in IMET funds to continue ANA training at U.S. military 
facilities. DOD's FY 2006 supplemental request for the ANA is $823M to 
support training, life support, maintenance, salaries, equipment, and 
infrastructure.
    In FY 2005, the State Department provided significant funding, 
including $424.5M in INCLE funds to provide training, mentoring, and 
reform assistance to the ANP. The FY06 budget includes $58.5M in INCLE 
funds to continue ANP assistance. DOD's FY 2006 ASFF supplemental 
request for the ANP is $1.3B, which covers all facets of the program--
including $585M for training, mentoring, and reform activities.
    DOD and State have worked closely together to develop this request, 
as required by the ASFF, and will continue to work closely together in 
implementing the program. DOD will directly support the equipment, 
infrastructure, and salary needs of the Afghan police while the intent 
is for DOD to transfer funds to the State to continue implementation of 
the critical training, mentoring and reform elements of the program. 
State provides a senior civilian deputy for police to OSC-A to ensure 
coordination between OSC-A and Embassy Kabul.

    Question. President Karzai has proudly stated that his country 
``now has a constitution, a President, a Parliament, and a nation fully 
participating in its destiny.'' Despite these significant 
accomplishments, Afghanistan remains a fragile state. How can we ensure 
the newly agreed-upon Afghanistan Compact is as successful as its 
predecessor Bonn Agreement of 2001? To what extent is the United States 
joined by other countries, including Afghanistan's neighbors, in 
continuing the fight against al-Qaeda, Taliban, narcotics traffickers, 
and warlords?

    Answer. The Afghan people and their current President have much of 
which to be proud. The progress that has already been achieved seemed 
almost unimaginable only a few short years ago. The international 
community recognized Afghanistan's new status during the recent London 
conference. The Afghanistan Compact adopted at the conference sets out 
a framework for a more mature partnership between the Afghan Government 
and the international community, with mutual commitments by each.
    Afghanistan is a full partner in the new compact with benchmarks to 
achieve and timelines to adhere to. Among the commitments made by 
Afghanistan are its pledges to consolidate peace by disbanding all 
illegal armed groups, and to create a secure environment by 
strengthening Afghan institutions to meet the security needs of the 
country. Afghanistan also vowed to achieve a sustained and significant 
reduction in the production and trafficking of narcotics over the next 
few years, with a goal of their complete elimination. The NATO-led 
International Security Assistance Force (ISAF), the U.S.-led Operation 
Enduring Freedom (OEF), and partner nations agreed to provide strong 
support in establishing security and stability in Afghanistan, in close 
coordination with the Afghan Government.
    The Joint Monitoring and Coordination Board, also established in 
the compact, provides a new forum for monitoring Afghanistan's 
compliance and for coordinating our efforts with those of the Afghan 
Government and other donors. For its part, the international community 
has backed up its political commitments with financial pledges totaling 
US$10.5 billion for the implementation of the interim Afghan National 
Development Strategy. With the country's institutions maturing and the 
commitment of the international community remaining high, the new 
compact should provide an even firmer basis for combating Afghanistan's 
acknowledged challenges.

    Question. The administration's pledge at the London conference 
essentially flatlines aid for Afghan reconstruction at $1.1 billion--
the same amount budgeted for the current fiscal year. The slow pace of 
reconstruction has generated popular discontent, directed at both the 
government of Hamid Karzai and at the United States. Given the 
resurgent strength of the Taliban, and a baseline of dissatisfaction 
that erupted into violent anti-Western protests in early February, 
would it be advisable to raise our commitment to Afghan reconstruction?

    Answer. An independent national survey in Afghanistan by ABC News 
in December 2005 measured opinions on a wide variety of issues related 
to the U.S. presence, Taliban legacy, pace of reconstruction, and 
satisfaction with the Afghan Government. The results were overwhelming 
and unambiguous. According to the poll, the Afghan people widely 
believe that despite still difficult living conditions, the U.S.-led 
overthrow of the Taliban was a positive development (87 percent), 
strongly support the administration of President Hamid Karzai (83 
percent), and firmly agree that the Afghanistan of today is headed in 
the right direction (77 percent). There is widespread sentiment that 
living conditions (85 percent), security from crime and other violence 
(75 percent), and freedom to express political opinions (80 percent) is 
better than it was under the Taliban.
    Regarding the level of U.S. assistance for Afghanistan, Secretary 
Rice announced at the London conference that the United States had 
provided a total of over $5.9 billion ($1.1 billion in FY 2006 + $4.8 
billion in FY 2005) since the last donor gathering in Berlin. In 
addition, she announced that our FY 2007 budget request for Afghanistan 
was over $1.1 billion.
    The FY 2007 figure only represents the Department's Foreign 
Operations budget request. Funding from other agencies that typically 
contribute to Afghan reconstruction and security assistance (such as 
DOD) is not factored into the FY 2007 number as it was for previous 
years. The reason for this is that it is still very early in the FY 
2007 budget cycle and the amount of USG funding that will be available 
from other sources is not yet clear.
    Thus, in terms of the Foreign Operations budget, the $1.1 billion 
requested for Afghanistan in FY 2007 actually represents an increase of 
27 percent, or over $200 million from the FY 2006 Foreign Operations 
request.
    We are confident that this request for FY 2007 is the right amount 
of funding necessary to support our vast reconstruction and security 
assistance programs in Afghanistan.

    Question. An [original question said ABC] NBC News Poll conducted 
in October 2005 found that a large majority of Afghans support the aims 
and effort of the United States in Afghanistan. However, this may 
reflect expectations for the future rather than satisfaction with the 
current unstable situation. Do you have a sense that the people's 
expectations can be met? How long does the government have to meet 
these expectations before support for it drops?

    Answer. Most Afghans think their life is already better. An ABC 
News poll in December 2005 \1\ found that 87 percent of Afghans 
surveyed believed the U.S.-led overthrow of the Taliban was good for 
their country. Eighty-five percent said that their living conditions 
had improved, and 80 percent said their freedom of expression is 
better. Seventy-five percent say their security from crime and violence 
has improved as well.
---------------------------------------------------------------------------
    \1\ See the ABC News poll at the end of the question and answer 
section.
---------------------------------------------------------------------------
    Of course, to maintain widespread support it will be necessary to 
manage expectations while continuing to deliver real improvements in 
people's lives. The political institutions that have developed at the 
national level need to demonstrate their relevance by delivering 
security and governance at the local level. Economic growth, in 
particular, will be key to meeting expectations. While it is not 
possible to predict the future course of public opinion in Afghanistan, 
maintaining a productive level of public support is most likely if the 
Afghan Government, with international support, keeps its focus on 
achieving progress in an equitable manner.

    Question. The impact of the opium and heroin trade is undermining 
progress in reconstruction and stabilization. How is the State 
Department ensuring that the strategies and tactics of U.S. agencies 
and our international partners are coherent and more cost-effective 
than they have been in the past? How much of the FY07 counternarcotics 
budget is devoted to demand reduction?

    Answer. Indeed, the cultivation, production, and trafficking of 
opiates exert a destabilizing influence on any country, but trafficking 
is particularly dangerous to an emerging democracy such as Afghanistan. 
The United States, with State's INL Bureau in the lead, is working with 
international partners to make a long-term, comprehensive investment in 
countering narcotics in Afghanistan in an effort to reverse forces that 
are hindering the development of the legal economy, fueling widespread 
corruption, undermining good governance, and supporting traffickers and 
other criminal elements. The following summarizes our efforts:
    First, INL participates in all international fora advocating for 
full-partner participation in Afghanistan's reconstruction and 
development. In 2006, both the London Conference on Afghanistan and the 
Doha Conference on Border Management in Afghanistan focused 
international community's attention on the need for a unified, 
integrated counternarcotics (CN) effort and solicited international 
support for CN and police programs. We will continue to encourage the 
active involvement of INL's international partners in combating illicit 
narcotics production and trafficking in Afghanistan.
    Concurrently, the United Kingdom is a key partner nation in 
coordinating international CN assistance, and INL works closely with 
them on every front. Recognizing the availability of CN moneys from 
donors lacking a bilateral relationship with Afghanistan, the United 
Kingdom, Afghanistan, and the United Nations established the Counter 
Narcotics Trust Fund (CNTF.) The UNDP oversees administration of this 
fund, while the Government of Afghanistan retains operational control 
over allocation--$78.6 million has been contributed since the fund was 
established in October 2005.
    Also, Department of Justice prosecutors, working alongside United 
Kingdom and Norwegian legal experts, mentor the Vertical Prosecution 
Task Force (VPTF), building long-term Afghan capacity to arrest, 
prosecute, and punish traffickers and corrupt officials. Currently, the 
docket contains over 100 ongoing prosecutions. In a significant October 
2005 victory, Afghanistan extradited its first high-value trafficker to 
the United States. The 2005 Anti-Narcotics Law, formally decreed by 
President Karzai, now provides a legal structure that allows for modern 
investigative techniques and for expedited international extradition.
    Moreover, it is important to note that the USG's five-pillar CN 
strategy is dynamic, changing in response to changing conditions on the 
ground. Our five-pillar CN implementation action plan contains programs 
that can quickly be modified to address emergent needs. The January 
2006 United Nations Office on Drugs and Crime's (UNODC) rapid 
assessment survey, anticipating sharp increases this year in opium 
poppy cultivation in the southern Helmand province, in addition to 
anecdotal evidence from the field, prompted INL to further action. 
Specifically, Embassy Kabul's CN Task Force and the Narcotics Affairs 
Section, working together with the Government of Afghanistan, United 
Kingdom, UNODC, and the U.S. military, quickly developed and 
implemented a responsive plan augmenting Governor-led eradication. This 
includes the deployment of additional security forces, the Afghan 
Eradication Force (AEF), targeted public information campaigns, 
alternative livelihoods programs and interdiction operations. The task 
force interacts daily with Helmand's provincial government, which 
continues to show good cooperation. By constantly reevaluating and 
improving the five-pillar strategy, the U.S. interagency is ensuring 
that our actions to help Afghanistan are both coherent and cost-
effective.
    Finally, even as our international partners contribute in various 
ways to CN efforts in Afghanistan, it is important to underscore U.S. 
principles and actions. We believe a credible show of force in tandem 
with substantive development activities are the cornerstones to 
limiting poppy cultivation and opium trafficking. The establishment of 
a clear and consistent legal system is also crucial in providing long-
term traction necessary to implementation of counternarcotics policies 
and programs. INL's Interdiction pillar focuses on targeting and 
dismantling drug trafficking organizations while building Afghan CN law 
enforcement capacity. The Afghan Counternarcotics Police, collaborating 
with the DEA, are arresting and beginning to prosecute the command and 
control elements of these organizations. The Narcotics Interdiction 
Unit, supported by the DEA's Foreign Advisory Support Teams and the 
Afghan Special Narcotics Force, interdicted 43.9 metric tons of opium 
and 6.1 metric tons of heroin in 2005. The presence of INL Huey II 
helicopters will aid in increasing seizure statistics. Akin to rule of 
law initiatives, the Justice Reform pillar works closely with 
interdiction efforts. A recent Afghan Presidential decree provides that 
major CN cases will be transferred to Kabul for prosecution by the 
VPTF, comprised of specially trained Afghan prosecutors and 
investigators.
    As for FY07, INL will devote $2 million to demand reduction 
initiatives including substance abuse prevention training; treatment 
techniques; technical assistance on the creation of drug-free community 
coalitions; and research into the identification of prevention and 
treatment ``best practices'' that can benefit demand reduction programs 
worldwide.

                        SELECTED COUNTRY ISSUES

    Question. In November of last year, the military rulers of Burma 
began relocating the ministries comprising the capital of Burma from 
Rangoon to Pyinmana. How do the relocation plans of the generals impact 
plans for construction of a new U.S. Embassy in Rangoon?

    Answer. These actions are not impacting the construction of the New 
Embassy Compound (NEC). The project is proceeding on schedule to be 
ready to move into by September 2007. The design-build contract for the 
Rangoon NEC was awarded at the end of FY 2004, and notice to proceed 
was given to the contractor in January 2005. Construction on the NEC is 
about 40 percent complete at the end of February 2006. The Thai and 
Australians are also proceeding with ongoing diplomatic construction 
projects in Rangoon.
    The move of the capital will make communications more difficult and 
further slow responses to our requests--a situation that will hinder 
the activities of all the embassies in Rangoon. The new capital is 
still under construction, and we have been informed that embassies 
cannot move to Pyinmana before 2008, which gives time to determine if 
this move will actually hold. Currently government officials welcome 
the opportunity to return to Rangoon to meet with us, but over time, we 
may have to increase our in-country travel to Pyinmana, among other 
options.

    Question. What is the status of construction of the new U.S. 
Embassy in Beijing, China? At this point, is construction proceeding 
``on budget''?

    Answer. Construction of our New Embassy Compound (NEC) in Beijing 
was initiated in May 2004. The $434 million project is on schedule for 
completion before the summer Olympics in 2008 and is proceeding on 
budget. Construction on the NEC is 28 percent complete as of March 
2006.
    By way of background, the Beijing NEC is being built on a 10-acre 
site in the ``Liang Ma He'' (3rd Diplomatic Enclave). In February 2004, 
the Department affirmed to Congress that the projected staffing was 
``rightsized.'' The Beijing NEC will accommodate 664 projected desk 
positions (both U.S. and local Chinese hires) and collocate 
approximately 20 U.S. Government agencies.
    In 2001, the Department developed a comprehensive plan to improve 
operationally and functionally inadequate U.S. facilities in China. The 
Beijing New Embassy Compound (NEC) is Phase I of that plan. New 
consulates in Guangzhou and Shanghai are phases II and III, 
respectively. Full funding for the Guangzhou Consulate is in the FY06 
budget.
    The United States and Peoples Republic of China signed the 
bilateral Conditions of Construction Agreement (COCA) in November 2003, 
which applies to the simultaneous construction of our Embassy in 
Beijing and the PRC Embassy in Washington.
    On the basis of reciprocity, the People's Republic of China (PRC) 
has begun construction of a new embassy in Washington. The status of 
the PRC Embassy project is as follows:

   In January 2004, the U.S. Commission of Fine Arts approved 
        the final design.
   The Groundbreaking Ceremony for the new PRC Embassy in 
        Washington was held on April 22, 2005.
   The project is scheduled to be completed in 2008.

    Question. The administration is recommending $20 million in ESF to 
``continue ongoing programs devoted to economic growth and reforms, 
good governance and poverty alleviation, as well as attacking pervasive 
corruption'' in the Philippines.

   What results can be demonstrated from previous ESF funds 
        expended to ``attack pervasive corruption''?

    Answer. ESF funds supported Philippine Government anticorruption 
efforts at the national and local levels, created greater public demand 
for reform, and enabled civil society participation in activities 
intended to curb corruption. For example, ESF funds were used to train 
investigators and prosecutors in the Office of the Ombudsman (the 
Philippine Government office charged with combating corruption), which 
they had not previously received, resulting in a significant 
improvement in the conviction rate from 13 percent in 2003 to over 30 
percent in 2005. At the local government level, ESF funds were used to 
help Mindanao cities improve their business practices and reduce 
corruption. A recent evaluation showed that these cities were 
successful in drastically reducing the processing time of business 
permit renewals from more than a week to just a few hours, which made 
their procurement transactions more transparent and removed 
opportunities for corruption. ESF was also used to implement 
transparent government procurement and insure accountability, as well 
as capacity-building in civil society organizations. Specifically, we 
provided training for 700 volunteers as observers in bids and awards 
committees to facilitate more rigorous monitoring of government 
procurement and to provide a means for reporting procurement 
irregularities to the Office of the Ombudsman.

    Question. India is increasingly looking to Iran to satisfy its 
rapidly growing energy requirements, particularly in the gas sector. 
How can we bridge the gap between our two countries' divergent policies 
toward Iran? To what extent do U.S. officials raise the issue of Iran 
with their Indian interlocutors? To what extent could India rely on 
energy suppliers other than Iran to fulfill its energy requirements?

    Answer. Rather than diverging, the gap between our two countries' 
policies toward Iran narrowed last September and February when India 
voted in the International Atomic Energy Agency Board of Governors' 
meetings to refer Iran to the United Nations over Iran's violations of 
its Nuclear Non-Proliferation Treaty obligations. The Indian Government 
does not want another nuclear-armed country in its neighborhood, nor do 
we.
    The United States avails itself of every opportunity to raise with 
the Indian Government our concerns and the concerns of the global 
community about Iran's egregious behavior. Iran is a frequent focus of 
our Embassy's daily engagement with the Indian Government. During his 
recent visit to India, President Bush emphasized that nuclear weapons 
in the hands of the Iranians would be dangerous for all of us. We have 
told the Indian Government that we do not support the proposal for an 
Iran-Pakistan-India pipeline and that such a project may invite 
scrutiny under the Iran-Libya Sanctions Act.
    We recognize India's growing energy needs and want to work with 
India to enhance its energy security. We have established joint working 
groups with Indian counterparts on oil and gas, power and energy 
efficiency, new technology and renewable energy, and coal to identify 
and develop indigenous energy resources that might be alternatives to 
Iranian imports, and to increase the efficiency of India's energy 
utilization, which may reduce the country's need for Iranian oil and 
gas. The United States-India Civil Nuclear Cooperation Initiative, if 
implemented, could also help reduce India's requirement for imported 
fossil fuels as India will have an opportunity to utilize the most 
modern and efficient technologies to develop its nuclear power 
industry. In addition, we continually encourage the Indian Government 
to seek stable and secure energy sources elsewhere in the Middle East 
and in Central Asia.

    Question. What is the rationale for continuing to provide large 
direct cash transfers to the Government of Pakistan, rather than 
programming increasing amounts of our assistance through USAID 
projects? What might the costs be in terms of U.S. policy toward 
Pakistan if the United States were to program more of our assistance 
toward USAID-sponsored democracy, health, and education projects? Would 
there be any potential gains for U.S. policy in the region in terms of 
countering anti-U.S., extremist attitudes?

    Answer. In 2003, the United States committed to provide Pakistan 
$300 million in Economic Support Funds per year in fiscal years 2005-
2009. According to agreements concluded in 2004 with the Pakistani 
Government, $100 million of this assistance will be used for project 
aid, and $200 million will be provided as budget support to be used for 
mutually agreed purposes. The Pakistani Government's budget planning 
assumes the United States will honor this commitment. It is important 
to establish our reliability.
    The Pakistani Government for its part has upheld its undertakings 
in this process. According to the agreement, which is reviewed and 
updated annually, Pakistan is to use the $200 million in budget support 
to achieve the goals it set for itself in the Poverty Reduction 
Strategy it developed with the World Bank. Notably, these goals include 
a commitment to increase spending on health and education 
significantly. Pakistan is, for example, committed to increase 
education spending from 2.5 to 4 percent of Gross Domestic Product 
within 5 years. The Pakistani Government has, in fact, boosted 
education spending significantly, from 1.7 percent of GDP in 2002 to 
2.5 percent in the fiscal year ending in June 2005. In short, our 
assistance has leveraged large increases in Pakistani Government 
spending on critical social needs. Budget support allows the USG the 
greatest input to build Pakistan's capacity in meeting these critical 
social needs without requiring a larger staff to be in country to 
administer the program. Security concerns still require us to limit 
staffing in Islamabad, and hence our ability to more closely monitor 
our activities.
    Changing the mix of assistance from budget support to project aid 
is unlikely to improve significantly our ability to counter anti-U.S., 
extremist attitudes. We believe that improved public outreach on 
USAID's activities would better address these concerns rather than just 
shifting funds to USAID programs in Pakistan; we are actively 
undertaking efforts to that end. Cutting funds from GOP budget support, 
however, could damage our ability to effectively work with the GOP. It 
could also result in decreased Pakistani Government spending on 
critical needs like education. The USAID mission in Pakistan has 
allotted $250,000 to launch a public information campaign that will 
build on the positive public response to our earthquake relief efforts 
and expand it to other parts of the portfolio.

                           U.N. PEACEKEEPING

    Question. Given the clear cost savings and burden-sharing with U.N. 
missions such as the one in Haiti, why has the administration not 
requested full funding for its past obligations?

    Answer. The inclusion of a funding request for arrears other than 
those related to Sudan-Darfur was not made because the administration 
limited its request for supplemental peacekeeping funding to the 
emergency situation in Darfur-Sudan.

    Question. Estimates are that the United States will run out of 
money to pay its peacekeeping dues by June of this year, with a 
shortfall of some half a billion dollars for 2006. Will this funding be 
included in the supplemental? If not, how can we insist that the United 
Nations reform itself when we are not paying our bills on time?

    Answer. Prior to FY 2000, the United States accumulated arrears of 
approximately $400 million primarily caused by a 25-percent cap on 
peacekeeping payments. Although Congress appropriated sufficient funds 
each year from FY 2000 until FY 2005 to pay annual assessments, the 
pre-2000 arrears remain outstanding, and in FY 2005 our arrears grew by 
$145 million because appropriated funds were not equal to our 
assessments.
    The shortfall for FY 2005 of $145.010 million and the projected 
shortfall for FY 2006 of $376.752 million totals $521.762 million. The 
FY 2006 supplemental budget contains a request of $69.8 million in the 
CIPA account for Sudan-Darfur as well as transfer authority language 
from the Peacekeeping Operations request which, in total, would offset 
$129.8 million of the above total arrears for a net projected new 
arrears of $391.962 million at the end of FY 2006.
    The inclusion of a funding request for these remaining arrears was 
not made because the administration limited its request for 
supplemental peacekeeping funding to the emergency situation in Darfur-
Sudan.

                      AIDS, MALARIA, AND AVIAN FLU

    Question. How much of the funding already appropriated for avian 
flu will be used for overseas programs? What specific programs will 
this funding entail? How will the $55 million in the budget request be 
spent?

    Answer. Of the nearly $3.8 billion appropriated in the FY 2006 
supplemental request for avian and pandemic influenza, a total of $280 
million will be used for overseas programs. This amount includes 
approximately $132 million managed by USAID; $114 million managed by 
HHS (Note: $31 million of the HHS total is for international research 
funding that is not counted as foreign assistance); $18 million managed 
by USDA; $10 million managed by DOD; and $6 million managed by the 
Department of State. The FY 2006 funds will be used for a wide variety 
of programs, including: Improving surveillance and response systems; 
support for the World Health Organization (WHO); the Food and 
Agriculture Organization (FAO); and the World Organization for Animal 
Health (OIE), international planning and preparedness; prepositioning 
of supplies; training of rapid-response teams and medical personnel; 
improved monitoring of animal vaccine distribution and use; support of 
human disease research; biosecurity enhancement; food safety and 
industrial methods training; vaccine formulation; military-to-military 
partnership capacity-building; international public information 
programs; and international coordination and support for the 
President's International Partnership on Avian and Pandemic Influenza.
    The State Department's $6 million will be spent on international 
response coordination involving foreign governments and nongovernmental 
organizations and diplomatic outreach. In addition to $280 million, 
agencies are exploring ways to increase their international assistance. 
The FY 2007 budget request of $55 million for USAID's international 
assistance programs will continue to be spent on surveillance and early 
warning preparedness, planning, prepositioned supplies and equipment 
and communications.

    Question. Does the administration intend to implement programs 
designed to prevent the spread of avian flu in developing countries? 
What is the anticipated impact on the budget if avian flu spreads as 
some health experts fear it might? For instance, are we prepared to 
ramp up avian flu programs if the virus spreads Africa-wide?

    Answer. Through the International Partnership on Avian and Pandemic 
Influenza announced by President Bush in September 2005, the 
administration is working hard to improve global readiness, including 
in developing countries, by elevating the issue on national agendas. In 
addition, the partnership brings together key nations and international 
organizations to coordinate efforts among donor and affected nations; 
mobilize and leverage resources to mitigate the spread of the disease; 
increase transparency in disease reporting and surveillance; and 
building capacity to identify, contain, and respond to a pandemic 
influenza.
    At the present time, we believe that $214 million in FY 2007 funds, 
in addition to $280 million in FY 2006 supplemental appropriations will 
be adequate, coupled with contributions of the international community, 
including financial and other support provided by multilateral, 
bilateral, and private sector donors. The reality of the threat of 
pandemic influenza is that it is too large for any one country to 
address alone, and requires a comprehensive and coordinated response 
from the international community.
    With regard to our efforts in Africa, the State Department has 
established an interagency African Avian Influenza Network that was 
activated to respond to avian influenza outbreaks in Africa, starting 
with Nigeria. U.S. Ambassadors are instructed to encourage host 
governments to promote strong interagency communication and 
coordination (particularly among Ministries of Agriculture, Health, and 
Information) to combat the threat of avian influenza. As in the case of 
Nigeria, U.S. Embassies are encouraged to work closely with other 
donors and U.N. resident representatives to prioritize host country 
needs and coordinate appropriate international responses. Our Embassies 
are instructed to convey to host governments the importance of 
coordinating their efforts with neighboring countries, and U.S. 
Embassies in neighboring countries also coordinate closely among 
themselves. Regional organizations such as the Economic Community of 
West African States (ECOWAS) have been engaged to develop regional 
response strategies and resources, as outbreaks become more widespread.
    Within the African Avian Influenza Network, the State Department's 
Avian Influenza Action Group and the Bureau of African Affairs are 
coordinating closely with the U.S. Agency for International Development 
(USAID), the U.S. Department of Agriculture (USDA), the Department of 
Health and Human Services (HHS), the Department of Defense (DOD) and 
other appropriate agencies, both in Washington and in affected and 
high-risk countries, to develop assistance programs and technical 
support for countries potentially affected by outbreaks. Both the 
interagency African Avian Influenza Network in Washington and the 
country teams at U.S. Embassies and consulates overseas are developing 
appropriate contingency plans for addressing the anticipated 
diplomatic, economic, and security concerns of countries affected by 
avian influenza in Africa. Our plans are coordinated with appropriate 
international technical organizations including the World Health 
Organization (WHO), the Food and Agriculture Organization (FAO), the 
World Organization for Animal Health (OIE) and the United Nations 
Educational, Scientific and Cultural Organization (UNESCO).

    Question. The administration is proposing $300 million for the 
Global Fund to Fight AIDS, Tuberculosis, and Malaria in FY 2007--less 
than Congress has provided in any of the last 4 fiscal years. To what 
extent does the administration's emphasis on funding bilateral AIDS 
programs, rather than the Global Fund, reflect disappointment with the 
work of the Global Fund? What is your assessment of the effectiveness 
of Global Fund efforts to assure accountability in the use of its 
resources?

    Answer. The Global Fund remains an important part of the Emergency 
Plan strategy, and the U.S. Government remains by far its largest 
single contributor of funds. The Emergency Plan originally anticipated 
allocating $1 billion to the Global Fund over 5 years. However, we are 
now on track to provide over $2 billion to the fund in 3 years. The 
President's fiscal year 2007 request for focus country bilateral AIDS 
programs funding--$2.717 billion within Foreign Operations and $2.776 
total--is, in part, an attempt to recover from the effects of the 
redirection of almost $527 million from focus country programs to the 
Global Fund and other components of the Emergency Plan over PEPFAR's 
first 3 years. If focus country budgets are not fully funded again in 
FY 2007, the capacity needed for a dramatic expansion of services in FY 
2008 will not be possible--and no increase in FY 2008 spending could 
undo this setback. Without the FY 2007 level of funding for the focus 
countries, it will not be possible to meet the 2-7-10 goals of the 
Emergency Plan--especially the goal of supporting treatment for 2 
million.
    At this point, the Emergency Plan can realize the most immediate 
impact through its bilateral programs, which focus on building capacity 
for massive, rapid scale-up of prevention, treatment, and care 
programs. The Global Fund plays an important long-term role in the USG 
strategy, providing financing to enable developing countries to respond 
to the challenges of HIV/AIDS, tuberculosis, and malaria. However, the 
Global Fund model, with a lean Secretariat and no field staff, does not 
allow funding to be deployed as quickly as USG bilateral programs. For 
example, from the time the Global Fund announces a Call for Proposals 
when it launches a round of financing, often a full year, at a minimum, 
passes until the time a grant recipient actually begins programmatic 
work. The Emergency Plan, with a global presence of dedicated full-time 
field staff, is typically able to program money within a much shorter 
time span. While the USG seeks to build the Global Fund into a 
successful international funding mechanism over time, in the immediate 
term, our judgment is that any redirection of resources from bilateral 
programs to the Global Fund will endanger our ability to reach the 2-7-
10 goals by 2008 envisioned by the President and Congress.
    Each country needs to find the right mix of bilateral and 
multilateral contributions to get the most immediate results from its 
investment. For the USG, the 20-year history of its bilateral programs 
means that these programs can move much faster--especially in the focus 
countries--than the Global Fund. In fact, other governments have made 
similar determinations to invest heavily in bilateral efforts rather 
than multilateral options:

   In 2004 the share of USG contributions that went to the 
        Global Fund was more than twice that of the United Kingdom.
   Countries with a much more modest presence on the ground 
        than the United States--such as Germany and Japan--are 
        comparable to the United States in terms of allocation of 
        funding between bilateral and Global Fund contributions.

    The Global Fund has shown promise, but it remains a young 
organization, and it must stick to its original vision as a 
performance-based, public-private financing instrument. The USG is 
working with the Global Fund to focus on areas where improvement is 
needed, particularly those areas highlighted by Congress. In spite of 
significant accomplishments, we continue to share concerns identified 
in the House FY05 and FY06 appropriations reports, for example, about:

   Possible shift from project support to budget support;
   Threats to the Comprehensive Funding Policy;
   Deficiencies in performance-based funding system;
   Concerns about adherence to rigorous progress benchmarks and 
        results-based disbursement;
   Lack of coordination of technical assistance for grants;
   Questions about the role of Local Fund Agents;
   Domination of Country Coordination Mechanisms by host 
        governments and international organizations;
   Devolution of authority from the Board to the Secretariat; 
        and
   Inadequate speed, efficiency, transparency, and 
        accountability of grants.

    If the Global Fund maintains its core mission and a model that 
Congress supports, and as the fund's performance improves in the years 
to come, there will be opportunities to reassess the level of USG 
funding for it. For FY 2007, however, it is crucial that the USG 
continue to concentrate its resources on focus country programs.

    Question. The State Department's Global AIDS Initiative directs its 
work primarily in 15 focus countries, 12 of them in Africa as well as 
Haiti, Guyana, and Vietnam. The FY 2007 budget proposes almost a 60-
percent increase in assistance to these countries, while bilateral 
programs for other nations appear to decline slightly. Does the FY 2007 
proposal enable the United States to adequately help other countries 
facing grave threats from AIDS, such as impoverished Malawi in Africa, 
Honduras in Central America, or India, China, and Russia?

    Answer. The overall request for Emergency Plan funding in fiscal 
year 2007 is up dramatically, from approximately $3.2 billion in FY 
2006 to $4 billion. Within this overall increase, priority was placed 
on the focus countries. Without the FY 2007 level of funding for the 
focus countries, it will not be possible to meet the 2-7-10 goals 
established by the President and Congress.
    At the same time, however, the request does include a modest 
increase from the FY 2006 enacted level of funding for bilateral 
programs in other countries (from $425.6 to $432.7 billion, not 
including funding for research).
    The President's FY 2007 request for the focus countries is, in 
part, an attempt to recover from the effects on focus country programs 
of the redirection of almost $527 million from focus country programs 
to the Global Fund and to other bilateral programs over the Emergency 
Plan's first 3 years. Of these three broad areas of the Emergency Plan, 
funding for the focus countries, originally planned to be $10 billion 
over 5 years, is the only one which has not been funded at the planned 
level overall to date. The President's fiscal year 2007 request for 
focus country bilateral AIDS programs funding--$2.717 billion within 
Foreign Operations and $2.776 total--is, in part, an attempt to recover 
from the effects of the redirection of almost $527 million from focus 
country programs to the Global Fund and other components of the 
Emergency Plan over PEPFAR's first 3 years. Other USG programs, 
including those beyond the focus countries, are on track to meet the $4 
billion target level over 5 years as originally envisioned for the 
Emergency Plan.

    Question. The United States Leadership Against HIV/AIDS, 
Tuberculosis, and Malaria Act of 2003 (P.L. 108-25) states the sense of 
Congress that by the end of fiscal 2006, U.S. assistance programs 
should be providing antiretroviral therapy to 2 million patients. Are 
we on track to meet this target?

    Answer. The USG will not meet the sense of Congress provision to 
support antiretroviral treatment for 2 million people by the end of the 
third year of Emergency Plan implementation, fiscal year 2006. The 
provision did not adequately reflect the need to invest intensively in 
building local capacity for scale-up of prevention, treatment, and care 
programs. Taking this concern into account, the President set a 5-year 
timeframe for meeting the Emergency Plan goals of supporting treatment 
for 2 million people, preventing 7 million new HIV infections, and 
supporting care for 10 million people infected and affected by HIV/
AIDS, including orphans and vulnerable children, in an accountable and 
sustainable way.
    The USG has made dramatic progress in its efforts to support host 
nations in building capacity, laying the foundation for long-term 
sustainability and continued success. As of September 30, 2005, the 
Emergency Plan supported life-extending treatment for approximately 
471,000 people with HIV/AIDS, 401,000 of them in the 15 focus 
countries. Based on the data collected through fiscal year 2005 and 
shared in the recent annual report to Congress, we are confident that 
we will meet the President's goals.
    The Emergency Plan remains committed to supporting national 
treatment strategies through partnerships with host governments, 
nongovernmental organizations (including faith- and community-based 
organizations), and the private sector, together providing the full 
spectrum of services required for quality treatment. These programs are 
providing services that achieve results while building the local, 
sustainable capacity needed for the long term. The services and 
capacity expansion supported to date include:

   Training for clinical and laboratory personnel;
   Training of counselors for treatment regimen adherence, 
        prevention, and healthy living;
   Physical infrastructure including improved clinical space 
        and laboratory equipment; and
   Distribution, logistics, and management systems for drugs 
        and other commodities.

    In order to meet the Emergency Plan's obligation of accountability, 
the Office of the U.S. Global AIDS Coordinator collects data on 
treatment and other results on a semiannual basis.

    Question. The legislation also requires that for fiscal years 2006 
through 2008, 10 percent of authorized funds be devoted to helping 
orphans and vulnerable children. How will you meet this target under 
the fiscal 2007 request?

    Answer. The Emergency Plan has already supported care for nearly 3 
million orphans and vulnerable children (OVCs) through prevention, 
treatment, and care activities in the 15 focus countries. Based on 
currently approved funding activities as of January 2006, we are 
already on target to meet the 10-percent budget requirement for OVCs in 
fiscal year 2006. The Emergency Plan will work to ensure that it 
continues to meet the budget requirement in fiscal year 2007 as well.
    As part of its efforts to ensure compliance with the 10-percent 
earmark in FY 2006 and beyond, the Emergency Plan has asked the USG 
teams in the focus countries to maintain focus on the following 
technical priorities in programming for OVCs:

   Strengthening systems and structures at the family, 
        community, and national levels to achieve scale and 
        sustainability for meeting the short- and long-term needs of 
        vulnerable children;
   Providing comprehensive quality services based on a menu of 
        essential services; and
   Facilitating a supportive context to reduce stigma and 
        discrimination and increase child protection (e.g., advocacy, 
        social mobilization, policy reform).

    In the related area of pediatric treatment, the USG plans to 
accelerate progress in fiscal year 2006 and beyond. Key initiatives 
include:

   Establishing targets for children on treatment at the 
        country level;
   Working with domestic and international partners to ensure 
        affordable pediatric ARV formulations and diagnostic 
        techniques, including:

     Improving laboratory infrastructure to support pediatric 
            diagnosis;
     Working with private and public sector partners to ensure 
            affordability of medicines;
     Strengthening the supply chain to allow for delivery of life-
            saving medicines to the children that need them.

   Training health care providers in pediatric treatment; and
   Working at the community level to fight stigma and provide 
        support to children and their caregivers.

    Question. USAID has made recent changes in how it implements its 
malaria program in response to earlier criticism that a large portion 
of funds was being spent on administrative overhead rather than 
insecticides, medical treatment, and mosquito netting. With the 
President's pledge to spend an additional $1.2 billion through FY 2010, 
do you anticipate any other changes to the program?
    What are the obstacles to reaching the President's objective of 
reducing malarial deaths in target countries by 50 percent?

    Answer. USAID does not envision further policy changes beyond those 
implemented in late 2005. The focus will be to fully implement these 
reforms throughout the USAID malaria program.
    The single greatest obstacle to achieving the President's goal of a 
50-percent reduction in malaria deaths is the weak health 
infrastructure in many sub-Saharan African countries. This includes a 
lack of adequately trained staff at all levels of the health care 
system and weak logistics and management systems. Other obstacles 
include: (a) The worldwide shortages of insecticide-treated mosquito 
nets and artemisinin-based combination drugs that are expected to 
continue for another 1-2 years; (b) delays in implementing Global Fund 
to Fight AIDS, Tuberculosis and Malaria grants in some countries; and 
(c) challenges involved in improving and controlling prescription and 
use of antimalarial drugs in both the public and private sectors. The 
USAID malaria program, African Governments, and other development 
partners are aggressively addressing these constraints. Each of the 
countries included in the President's Malaria Initiative has a 
comprehensive malaria control plan that was developed in conjunction 
with the National Malaria Control Program and other partners.

                             USAID ACCOUNTS

    Question. Is the United States paying adequate attention to 
countries that are not selected to participate as focus or Compact 
countries in the MCA, PEPFAR, and malaria initiatives? Is U.S. economic 
assistance evolving into highly selective programs that concentrate 
only on the ``best performers'' or those with most severe health 
challenges? Have we made a decision not to address the needs of large 
populations living in poverty in those countries that fall outside the 
``preferred'' categories?

    Answer. USAID focuses the bulk of its resources where the needs are 
greatest and where expected results are highest, including countries 
where there is political commitment. That said, where the need is great 
and political will is weak, USAID still provides support for 
humanitarian purposes to reach the poor, often through nongovernment 
channels. The United States provides assistance from a number of 
accounts to a wide array of countries--well over 100. Aside from Burma 
and China, the United States has a significant aid program in every 
low-income country with large numbers of poor people.
    Further, the programs mentioned in the question are less 
concentrated than commonly recognized.

   The number of MCA eligible countries rose from 16 in 2004 to 
        23 in 2005. An additional 13 countries are eligible for 
        threshold programs aimed at achieving MCA eligibility.
   PEPFAR resources are focused on 15 countries that account 
        for about half of the world's 40 million HIV infections. There 
        are five other bilateral country programs that receive over $10 
        million in USG assistance annually. Together with the 15, they 
        cover 70 percent of the world's HIV infections. Overall, PEPFAR 
        funds are supporting programs in 123 countries, much of which 
        is focused on large, low-income populations, many of which are 
        in Africa. The USG is the largest bilateral donor to the Global 
        Fund for HIV/AIDS and through its contributions reaches 
        additional countries.
   USAID currently supports malaria activities in 18 countries 
        plus 2 regional programs. Most are in low-income countries in 
        Africa where the malaria prevalence is highest and the 
        potential for impact is greatest. The President's Malaria 
        Initiative (PMI) focuses increased resources on countries most 
        affected by the disease, growing from 3 countries this year to 
        15 countries by 2008.

    Question. What is the justification for the cut in the USAID 
Development Assistance account?

    Answer. The FY 2007 DA and CSH combined request is a slight 
increase over the FY 2006 President's budget, so the administration has 
maintained our overall priority for funding. However there was a shift 
from DA to CSH to meet a commitment for increasing malaria funding 
which resulted in less DA funding for programming in all regions.

    Question. Latin America is particularly affected by the cuts in the 
USAID Development Assistance account. Estimates are that aid to Latin 
America from this account will decrease by 28 percent. Could you please 
give us the overall amount for Latin America envisioned in this budget 
once all aid programs are included, including Economic Support Funds 
(ESF) and Millennium Challenge Corporation (MCC), and compare it to 
last year's figure? Are cuts to the region justified? What are the 
comparable figures for Africa, which is seeing a 4-percent cut in the 
Development Assistance account?

    Answer. While the FY 2007 request for Development Assistance 
funding has been reduced from the FY 2006 enacted level of $254 million 
to $182 million (28 percent reduction), the overall foreign assistance 
request for the region has remained similar to previous years because 
of increased Millennium Challenge Account (MCA) funding. In addition, 
the FY 2007 request for Economic Support Funds is $31 million more than 
the FY 2006 level and will focus on rural development and market 
access. The FY 2007 level for USAID's programs in Latin America and the 
Caribbean is $92 million less than the FY 2006 allocation of $914 
million (11 percent reduction); given this, LAC has begun a process of 
limiting sectors and retargeting resources to areas identified as 
weaknesses by the MCC.
    In FY 2006, the MCA will be providing significant resources through 
Compact agreements to Nicaragua ($175 million) and Honduras ($215 
million) and through Threshold Country funding to Paraguay ($37 
million). The Threshold Country program will be managed by USAID and is 
included in the Agency's planned spending for FY 2006. With the 
addition of MCA resources focusing on areas of rural development 
traditionally implemented by USAID, the FY 2007 budget request is 
adequate to reach the Agency's goals in the region.

    Question. When the President announced the MCA initiative in March 
2002, he said funds would be in addition to, and not a substitute for, 
other U.S. economic assistance. Nevertheless, in the FY 2007 budget 
request, for the six MCC Compact countries where USAID maintains an aid 
program, overall economic assistance would decline from FY 2006 levels: 
Honduras, from $32 million to $25.5 million; Nicaragua, from $32 
million to $22.7 million; Armenia, from $74.3 million to $50 million; 
Madagascar, from $21.5 million to $17.5 million; and Benin, from $12.3 
million to $8.8 million. Has there been a change in the 
administration's thinking that regular U.S. economic assistance can be 
reduced in MCC Compact countries? Will the compacts adequately 
substitute for the sector priorities funded in the past by USAID? Is 
the same thing likely to occur as other countries sign MCC Compacts?

    Answer. There are two countries in the Western Hemisphere with MCC 
Compacts: Nicaragua and Honduras. While, FY 2006 DA resources for these 
two countries have been reduced, it is not the result of the Millennium 
Challenge Account fund. USAID reduced the FY 2006 levels for these 
countries to meet the administration's commitment to provide resources 
for improvements to the labor and environment sectors under CAFTA-DR.
    The FY 2007 funding is reduced by 26 percent for Honduras and 41 
percent for Nicaragua, while Honduras has received an MCC compact of 
$215 million and Nicaragua has received an MCC compact of $175 million. 
One focus of these compacts is on agricultural development, including 
crop diversification and market access, developmental programs 
traditionally funded by USAID. Another focus of the MCC programs is on 
the improvements in the highways and roads in both countries and one 
port in Nicaragua. These projects will compliment USAID's development 
programs in Nicaragua and Honduras at the local and national level.

                    MILLENNIUM CHALLENGE CORPORATION

    Question. The administration is requesting $3 billion for MCC again 
this year. There has been skepticism in the past that the organization 
can spend this amount of funding effectively and efficiently. Can you 
explain why $3 billion is justified this year?

    Question. On April 3, 2006, MCC will sign its eighth compact, 
reflecting commitments of over $1.5 billion, in addition to having 
signed threshold agreements with five countries for nearly $100 
million. In the current fiscal year, MCC is on track to finalize at 
least three more compacts totaling an additional $1.1 billion, which 
will represent funding commitments of up to $1.7 billion for fiscal 
year 2006 (FY06), almost twice the level committed in FY05.
    MCC projects that in FY07, we expect to sign between 9 and 12 new 
compacts, comprising commitments of more than $3 billion. As a result, 
MCC will have total commitments approaching $6 billion, with up to 21 
countries, by the end of FY07.
    Because of the robust demand of eligible countries, we are 
projecting that all currently available program funds from FY04, FY05, 
and FY06 will be exhausted by the second quarter of FY07, making the 
FY07 request for MCC all that more critical to our success.
    At funding levels lower than $3 billion, MCC will likely delay 
negotiating compacts with some eligible countries, not to mention the 
newly eligible FY07 countries that the board of directors will select 
this November. It would be unfortunate if these countries who have 
undertaken significant political, economic, and social policy reforms, 
and those striving to be selected, find that meeting the criteria for 
eligibility does not result in actual funding of their development 
projects to achieve long term sustainable economic growth.
    As Chair of the MCC Board of Directors, this is something I, and 
the board, feel strongly about, as noted in the recent letter to Senate 
and House appropriators that each member of the board signed. I look 
forward to working with Congress to ensure that MCC has sufficient 
funding to as we move forward with our critical mission in the 
developing world.

    Question. As chairman of the board of the MCC, how do you assess 
the corporation's first 2 years of activities? How would you 
characterize the changes put in place by the new CEO, Ambassador 
Danilovich? Do you agree with his plan to fund larger, but possibly 
fewer compacts in order to achieve greater MCC impact?

    Answer. MCC's first 2 years are ones of great progress and great 
learning. In February 2004, MCC started with just eight people, a 
budget and borrowed office space. In executing its mandate, MCC 
experienced the usual difficulties inherent in all startups, where 
virtually all activities were being done for the first time. The 
challenge of building an organization while working through its 
engagement with newly selected countries on a new development concept 
was substantial.
    MCC has successfully established itself as an organization and will 
soon have eight compacts to show for its efforts so far. MCC took on 
many of the lessons from its successes and shortcomings during this 
time of tremendous growth and continues to expand its capabilities and 
sophistication in its activities as it continues to move forward, 
particularly under the new leadership of the new CEO, Ambassador 
Danilovich. For example, MCC has developed detailed guidance for 
partner countries so expectations are clear on both sides and the 
compact development process can move much more quickly and smoothly.
    No longer a startup, MCC has also implemented a range of internal 
management provisions to improve its function as an organization. For 
example, MCC has spent considerable effort since Ambassador 
Danilovich's arrival to establish various internal fiscal and policy 
controls, an aggressive staffing plan to hire sufficient personnel to 
handle the increasing workload, and a much improved budgeting process.
    Last, I am fully supportive of Ambassador Danilovich's push for 
larger compacts in a limited number of countries. MCC's mission is to 
transform poor countries through funding and incentives so that our 
partner countries are the ones championing the necessary reforms and 
policy measures to increase economic growth and reduce poverty through 
their own efforts and leadership. Development and the political will 
for development cannot be imposed from the outside, and MCC is targeted 
to those countries that seek most seriously their own success.

    Question. When the President announced the initiative in March 
2002, he said MCC would be in addition to, rather than a substitute 
for, other U.S. economic assistance. Nevertheless, the countries that 
are now MCC countries are seeing a drop in regular assistance in the FY 
2007 budget request. Is this a pattern that we expect to repeat in 
every MCC country? How do you see the relationship between regular 
assistance and MCC assistance?

    Answer. The MCA is very much considered an addition rather than a 
substitute for traditional U.S economic assistance. While I do not 
believe MCC is a substitute for other funds, I do have an obligation to 
make choices among competing demands. One criterion is to avoid overlap 
and duplication of funding efforts. Based on overall need and 
commitment, I focused the resources where there is relatively high 
country commitment and need. This resulted in proportionately more 
resources going to Africa and South Asia, and fewer to Latin America. 
The request for the Development Assistance Account in the President's 
Fiscal Year 2007 (FY07) Budget is $227 million, lower than the 2006 
enacted level. However, the administration has focused funding in this 
account on transformational development and accountability for results, 
particularly in Sub-Saharan Africa. For example, the budget increases 
the focus on countries that have the greatest need for assistance, 
along with the greatest likelihood of achieving results with this aid. 
Further, this account reduces funding for middle-income countries where 
the needs are not as great, and in MCA eligible countries where 
governments are proposing MCA programs that significantly overlap with 
traditional accounts.

    Question. How do you see the relationship between the MCC Chief 
Executive Officer and the USAID Administrator now that the USAID 
Administrator will be serving as your Director of Foreign Assistance?

    Answer. I have every confidence that Ambassador Tobias, as Director 
of Foreign Assistance and Administrator of USAID, and Ambassador 
Danilovich, MCC CEO, will work hand-in-glove to address the pressing 
issues that face developing countries. MCC has already established a 
healthy and cooperative relationship with USAID, particularly since 
USAID plays a key role in MCC's Threshold Program, and I expect that 
this will continue and strengthen under USAID's new leadership. MCC 
will continue as an independent corporation, as it was originally 
designed, but will work closely and in concert with the direction of 
the priorities and strategies of the Director of Foreign Assistance.

                       TRANSFORMATIONAL DIPLOMACY

    Question. Do you foresee additional security needs as we launch 
more people beyond our Embassies to work in American Presence Posts 
outside capital cities?

    Answer. The Secure Embassy Construction and Counterterrorism Act 
(SECCA) of 1999 (Public Law 106-113) requires that any new diplomatic 
facility meet collocation and 100-foot-setback statutory requirements. 
The collocation, setback, and waiver requirements uniformly apply to 
embassies, consulates, and American Presence Posts (APPs). Once a post 
has identified a potential APP site, the Regional Security Officer 
(RSO), in coordination with DS Headquarters and the Bureau of Overseas 
Buildings Operations (OBO), will conduct a physical security survey of 
the location to determine security requirements. APP sites must adhere 
to, or be in, the final stages of compliance with the Overseas Security 
Policy Board (OSPB) standards prior to occupancy. Additionally, waivers 
to SECCA and exceptions to OSPB standards must be obtained for any site 
deficiencies that cannot be remedied. Once all requirements are firmly 
identified, available Department resources will be prioritized as 
necessary.

    Question. Will the Virtual Presence Posts be combined with the 
Successful American Corners program where computers and American-
generated literature are located in public and university libraries for 
use by the public and students?

    Answer. Both the Virtual Presence Posts (VPP) and American Corners 
program are options available to Chiefs of Mission overseas to improve 
outreach and engage the local public. The programs are not mutually 
exclusive and, in fact, should reinforce one another. Depending on the 
post's need and the local situation, one or both of the programs may be 
appropriate for posts to use as a platform to reach out to different 
communities in the host country. The offices responsible for the 
respective programs are coordinating efforts and working together to 
provide guidance to posts.

    Question. A recently submitted report to Congress on the level of 
language-designated positions at our Embassies shows that for FY05, 
none of these positions have been filled in Baghdad by qualified Arabic 
speakers. Perhaps even more alarming, the report said that only four of 
all the positions in Baghdad were designated as requiring Arabic. How 
can this be when we so desperately need to communicate better with the 
Iraqis? In Kabul, another critical post, 11 out of 18 positions are 
currently staffed by officers ``meeting'' or at least ``partially 
meeting'' the language requirement there according to the report. Given 
the number of new positions that Congress has authorized and funded for 
the Department, why aren't more language qualified officers filling 
these critical needs?

    Answer. The U.S. mission in Iraq was established in June 2004 
following an extensive interagency planning process resulting in the 
transition from the Coalition Provisional Authority (CPA) to a full 
fledged U.S. Embassy. Employees were then, and still are, significantly 
restricted from moving out of the International Zone, given the 
security environment, although employees do regularly travel outside 
the International Zone to fulfill mission requirements. Although Arabic 
language proficiency is an important element to many U.S. mission Iraq 
jobs, not every position requires full working proficiency in the 
language. The Bureau of Near Eastern Affairs (NEA) sought officers with 
well-rounded skills who could function effectively in a very difficult 
environment. Many Iraqi Government, business and opinion leaders speak 
excellent English. Existing language gaps have been filled with the use 
of talented interpreter/translators.
    The Foreign Service Institute (FSI), the Human Resources Bureau 
(HR), and the Bureau of NEA are developing a cadre of advanced speakers 
who will support transformational diplomacy and defend and advance U.S 
interests abroad. The Bureau of Human Resources, in its Foreign Service 
recruitment process, has established incentives for Arabic and other 
hard language qualified officers to help meet the Department's growing 
need for language proficiency. In the past 3 years, HR has recruited 30 
professional proficient Arabic speakers. In FY 2003 through 2005, the 
Foreign Service Institute reports 312 enrollments of State employees in 
courses designed to achieve Limited Working Proficiency (2 level) in 
Arabic (including Standard Arabic and Egyptian Arabic) and another 105 
enrollments of State employees in courses designed to achieve General 
Professional Proficiency (3 level) or higher in Arabic. The Bureau of 
Near Eastern Affairs continues to provide long-term Arabic training 
opportunities for Foreign Service employees, including training 
beginning in September 2006.

    Question. A number of your proposals for transformational 
diplomacy--Foreign Service officers trained to run programs, 
operational nation-building activities far away from capitals, 
strengthening rule of law, improving health and reforming education--
are all missions that are currently being carried out by USAID 
officials. Can you describe where you see such missions overlapping and 
give us a sense of how you see responsibilities dividing between USAID 
and State in the field?

    Answer. As we transform to being more engaged in a ``hands-on'' 
fashion to try to help people transform their lives, there will be 
enough work for both the Foreign Service and the USAID corps. These 
roles are by no means redundant or competitive. USAID is our primary 
delivery mechanism for hands-on assistance and will continue to play 
that role in even a stronger way, but a more coordinated way. A 
strengthened USAID only augments these capabilities. Foreign Service 
officers are and will continue to become engaged in a different kind of 
work than in the past, while still maintaining traditional diplomatic 
roles, and must be well trained properly to do so.

    Question. Since 2003 there has been a decline in the number of 
people taking the Foreign Service exam. In addition, there was a gap in 
the number of training positions versus training goals at the 
Department. How will State make up that gap? How do you plan to 
encourage more people to take the Foreign Service exam? What effect 
might your transformational diplomacy have on Foreign Service 
applications in the coming years?

    Answer. In 2003, 20,342 applicants took the written examination; in 
2004, 19,101; and in 2005, 18,699. While it is true that slightly fewer 
people took the exam in recent years, we still have a very large 
candidate pool for a relatively small number of positions. 
Nevertheless, we have a number of efforts aimed at encouraging more top 
quality people to take the Foreign Service exam, including internships, 
fellowships, partnerships with nongovernmental organizations, 
participation in a variety of conferences, advertising, and the use of 
foreign language materials to reach out to family members of potential 
recruits so they will better understand the challenges and rewards of a 
Foreign Service career. Our Diplomats in Residence identify, counsel, 
and mentor potential Foreign Service candidates.
    It is our hope that transformational diplomacy will attract 
individuals to the Foreign Service in even larger numbers for a career 
where they will be on the cutting edge of diplomacy, and where they are 
more than ever on the front lines as U.S. representatives in new 
postings around the world.
    The Diplomatic Readiness Initiative of Fiscal Years 2002 to 2004 
included plans for 512 training positions. In fiscal year 2004, 
Department appropriations fell 89 positions short of the DRI goal. In 
addition, due to the emerging requirements of staffing Iraq and 
Afghanistan, an additional 153 positions were diverted from training, 
leaving the Department a total of 242 positions short of our DRI 
training goal.

    Question. Please explain the proposed pay-for-performance system. 
Do you expect that it will boost retention and recruitment? How 
competitive would this system be with the private sector? What effect 
would this new performance-based pay system have on the pay of current 
Foreign Service officers?

    Answer. The Department understands that the final legislative 
proposal on Foreign Service modernization will be transmitted by the 
administration very soon. Generally, the system would eliminate 
longevity-based pay increases and institute a system similar to that 
already in place for the Senior Foreign Service, wherein an employee's 
annual pay adjustment is dependent on the previous year's performance 
assessment. The proposal would also establish a global rate of pay for 
the Foreign Service to attract and retain a labor market for worldwide-
available personnel, based on the needs of the Service, consistent with 
other pay systems with similar worldwide availability requirements.
    We expect that the proposed system will enable the Department to 
continue to recruit and retain top talent willing to spend a great 
portion of their career overseas. Currently the private sector and 
other components of the USG employ pay structures for their worldwide 
deployable workforce that reward rather than penalize overseas service. 
This proposal will reward employees commensurately with performance and 
will restore the incentives for overseas service throughout an 
employee's career.
    The effect on current Foreign Service officers at the FS-01 level 
and below, like the Senior Foreign Service, would also no longer be 
guaranteed an annual pay increase just for an additional year in 
service. As of April 2008, all increases in pay would be performance-
based. Further, the rank-and-file Foreign Service would no longer take 
a pay cut for serving overseas, significantly restoring the incentive 
for overseas service. Under the forthcoming proposal, as of April 2008, 
one global pay schedule would be used for Foreign Service personnel 
(FS-01 and below) regardless of overseas or domestic location.
    Although the system does not address the differences between the 
public and private sector on pay levels in general, it employs both 
private and public sector standards for pay benefits for professional 
staff who spend the majority of their careers deployed worldwide on a 
rotational basis. The majority of the private sector, the United 
Nations, most NGOs, and the USG intelligence agencies do not require 
their employees to take a pay cut when deploying on assignment to an 
overseas location.

                             CLIMATE CHANGE

    Question. The UNFCCC--Although the United States is not a party to 
the Kyoto Protocols, the United States did ratify the United Nations 
Framework Convention on Climate Change (UNFCCC). At a recent meeting of 
the parties to the UNFCCC in Montreal, State Department officials 
signed a document pledging to a ``dialogue on long-term cooperative 
action to address climate change.'' What is the Department's strategy 
to achieve this UNFCCC dialogue? Does the Department foresee this 
dialogue under the UNFCCC leading to regional, multilateral, and 
bilateral agreements and treaties dealing with climate change? What 
part does the Asian Pacific Partnership play in this dialogue under 
UNFCCC? What other climate change mitigation initiatives undertaken by 
the administration are part of this UNFCCC dialogue?

    Answer. The United States views the UNFCCC ``Dialogue on Long Term 
Cooperative Action to Address Climate Change'' as an opportunity to 
advance our practical, results-oriented climate policy, especially 
through showcasing our multilateral climate science and technology 
partnerships. The dialogue is not a negotiating forum, as the UNFCCC 
decision establishing the dialogue makes clear, but a series of up to 
four workshops in which we will share our experiences in addressing the 
climate challenge--especially in the areas of sustainable development 
goals, adaptation, the role of technology and the importance of 
realizing the full potential of markets. We are actively engaged in 
preparing to participate in the first meeting of the dialogue, which 
will take place in May.
    The United States is currently involved in a wide range of 
multilateral agreements and other initiatives dealing with climate 
change that are consistent with UNFCCC goals. They include:

   Leading nuclear technology research and development through 
        the Generation IV International Forum;
   Pioneering hydrogen as a clean energy carrier, through the 
        International Partnership for the Hydrogen Economy;
   Developing cost-effective technologies to capture and store 
        carbon emissions from abundant fossil fuels under the Carbon 
        Sequestration Leadership Forum;
   Integrating and expanding global measurements to improve 
        decisionmaking, under the Group on Earth Observations;
   Bringing cost-effective, energy-producing methane capture 
        and use technologies to developing countries through the U.S.-
        initiated Methane-to-Markets Partnership; and
   Increasing access to modern energy services in more than 20 
        countries through the Global Village Energy Partnership. The 
        United States has also renewed its participation in ITER, the 
        international project to harness fusion energy.

    The new Advanced Energy Initiative (AEI) will increase spending on 
clean-energy sources that will reduce oil usage and change the way we 
power our homes and automobiles. The initiative includes significantly 
increased funding in fiscal year 2007 for biofuels research, the Solar 
America Initiative, the Hydrogen Fuel Initiative, and FutureGen, the 
world's first zero-emissions fossil fuel plant. The Global Nuclear 
Energy Partnership, a component of the AEI, is a comprehensive strategy 
to enable an expansion of nuclear power in the United States and around 
the world, to promote nuclear nonproliferation goals, and to help 
resolve nuclear waste disposal issues. DOE's fiscal year 2007 budget 
request includes $250 million for this effort.
    Since 2001 the United States has negotiated bilateral climate 
change agreements with 13 individual countries, a group of 7 Central 
American countries, and the European Union. Scientific research, clean 
energy technologies, and capacity-building are emphasized, with policy 
discussions also underway.
    In January, six countries (Australia, China, India, Japan, Korea, 
and the United States) launched the Asia-Pacific Partnership for Clean 
Development and Climate to help accelerate the global deployment of 
clean and efficient energy technologies and practices. The 
partnership's activities will be consistent with, and contribute to, 
our efforts under the UNFCCC.
    We view these multilateral agreements and other initiatives as 
successful examples of practical approaches to achieving the objectives 
of the UNFCCC. Stabilization of greenhouse gas concentrations in the 
atmosphere will require the development and deployment of new, 
transformational clean energy technologies, and we are taking the lead 
through our domestic programs and by mobilizing the international 
efforts outlined above.

    Question. Official Senate Observer Group--When President Reagan 
initiated arms control negotiations with the Soviet Union in 1985, he 
asked the Senate to establish an official observer group. This official 
Senate observer group greatly contributed to bipartisan Senate support 
from the lengthy and complicated treaties resulting from the 
negotiations. Treaties negotiated without this kind of strong 
bipartisan support, like Kyoto, also contribute to international 
misunderstandings and American public diplomacy problems when the 
Senate expresses opposition, as it did with Kyoto through the Byrd-
Hagel resolution. This committee has gone on record unanimously calling 
for an official Senate observer group to participate in future 
negotiations over climate change. Do you support such a role for the 
Senate? Are you willing to work with the Senate on such a process?

    Answer. The administration welcomes the participation of Senators 
and their staff as observers on our delegations to the U.N. Framework 
Convention on Climate Change. We seek to advance our climate change 
approaches through the Framework Convention, of which we are a member, 
and we seek to protect U.S. interests as parties to the Kyoto Protocol 
move ahead on their agenda.
    We note that congressional observers from both the Senate and the 
House regularly participate on U.S. international delegations. For 
example, this past December, a Senator and nearly 30 congressional 
staff members traveled to Montreal, Canada, to observe climate change 
proceedings as part of the U.S. delegation. Congressional participants 
attended meetings of the U.S. delegation; received regular and frequent 
briefings; and attended both formal and informal negotiating sessions.
                                 ______
                                 

                    Questions of Senator John Sununu

                     DIRECTOR OF FOREIGN ASSISTANCE

    Question. In addition to AID's long-time primacy and expertise with 
regard to development assistance, DSCA has unique abilities with regard 
to security assistance, and Congress recognized many years ago that 
other government agencies could make similar unique contributions in 
their own areas of expertise. For which programs, accounts, and 
agencies do you intend the DFA to be responsible?

    Answer. I am establishing the position of Director of Foreign 
Assistance (DFA) to better align our foreign assistance programs with 
our foreign policy goals, to align more fully the foreign assistance 
activities of USAID and State, and to demonstrate that we are 
responsible stewards of taxpayer dollars. The DFA is intended to 
provide overall leadership to foreign assistance that is delivered 
through other agencies and entities of the U.S. Government. To the 
extent permitted by law, I will delegate to the DFA the foreign 
assistance funding authorities consistent with and necessary to achieve 
a single coordinated foreign assistance approval authority. The 
Director of Foreign Assistance will work closely with other government 
agencies in exercising his authority over foreign assistance funding 
and programs and developing coordinated strategies, plans, and budgets. 
Under my direction, the DFA will have approval and coordinating 
authority over all foreign assistance.

    Question. On what basis will the DFA have authority over those 
programs, accounts, and agencies? Will the DFA assume the statutorily 
based authorities of, e.g., the SEED and FSA coordinators? If not, how 
do you envisage the relationship between the DFA and programs with 
independent statutory authorities? How will the DFA be able to direct 
and affect the design, implementation, and evaluation of specific 
programs?

    Answer. To the extent permitted by law, I will delegate to the DFA 
the foreign assistance funding authorities consistent with and 
necessary to achieve a single coordinated foreign assistance approval 
authority. The Director of Foreign Assistance will work closely with 
coordinators in exercising his authority over foreign assistance 
funding and programs and developing coordinated strategies, plans, and 
budgets.
    The DFA is intended to provide overall leadership to foreign 
assistance that is delivered through other agencies and entities of the 
U.S. Government. By instituting integrated country strategies and 
operating plans, the Director of Foreign Assistance will help ensure 
that USG agencies delivering foreign assistance are not working at 
cross purposes, that, in fact, we are taking advantage of agencies' 
comparative strengths to create a U.S. Government program that is 
effective and makes the most efficient use of taxpayer dollars. With 
specific respect to agencies that have an independent statutory 
existence, the Director of Foreign Assistance will work closely with 
them to address the pressing issues that face developing countries and 
to ensure that programming is complementary and stove-piping is 
curtailed. We will respect statutory authorities, but also seek 
opportunities for synergy and efficiency.
    The added value of the Director of Foreign Assistance role is not 
in interfering with the core functions, specific responsibilities, or 
operations of the various agencies implementing foreign assistance; it 
is in ensuring that all activities are part of a coordinated whole, 
and, therefore, that impact is greater than the sum of parts.

    Question. What sort of support staff would the DFA have? There is 
nothing in the FY 2006 or FY 2007 budget requests suggesting new 
positions are needed to implement this initiative. Is it your intention 
that this become an adjunct function of AID's Program Planning 
Coordination staff (PPC), since the DFA would also be the 
Administrator?

    Answer. With regard to staff needs for the Director of Foreign 
Assistance, I intend for this office not to be duplicative, but instead 
to add value to the current environment. I anticipate an office that, 
when fully staffed, will bring together something in the range of 50 to 
100 positions, based on bringing together existing staff who are 
performing common foreign assistance functions in the two 
organizations. The DFA will consult with and provide a full 
notification to Congress once we have made the necessary decisions 
about how to best utilize these existing functions.

                     PUBLIC DIPLOMACY ORGANIZATION

    Question. Please provide the committee with a spreadsheet showing 
for each of the years 1996-2005 the following:

   The number of PD (or USIA, for the preintegration years) 
        officers, by grade (O-5 to MC) and their average time-in-class 
        (TIC);
   The number of PD positions, by grade;
   The number of new PD hires, by grade;
   The number of retirements or other departures, by grade;
   The number of PD officers promoted into that grade and their 
        average TIC and time-in-service (TIS);
   The number of PD officers serving in non-PD-cone positions;
   The number of non-PD officers serving in PD positions.

    Answer. Reliable information on these issues is not available for 
1996 to June 2000. See spreadsheet below for information from 2000 to 
2005.

                                  THE NUMBER OF PD OFFICERS, BY GRADE (O5 TO MC) AND THEIR AVERAGE TIME-IN-CLASS (TIC)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    CY 05             CY 04             CY 03             CY 02             CY 01             CY 00
                                             -----------------------------------------------------------------------------------------------------------
                    Grade                                Avg.              Avg.              Avg.              Avg.              Avg.              Avg.
                                               No. of    TIC     No. of    TIC     No. of    TIC     No. of    TIC     No. of    TIC     No. of    TIC
--------------------------------------------------------------------------------------------------------------------------------------------------------
CM..........................................       2      4.9        4      3.4        4      2.2        5      2.4        6      1.4        6      0.8
MC..........................................      56      3.4       59      2.9       54      2.7       49      2.1       41      1.8       35      0.9
OC..........................................      79      3.2       81      2.9       89      2.7       87      2.2       83      1.9       80      0.9
O1..........................................     171      3.9      178      3.4      175      2.9      170      2.5      181      1.8      182      0.8
O2..........................................     148      4.2      163      3.5      174      3.0      175      2.6      184      1.8      179      0.9
O3..........................................     141      1.4       79      1.5       65      1.7       74      2.2       81      1.6       88      0.8
O4..........................................     283      1.8      244      1.6      167      1.5      115      1.3       56      1.1       42      0.9
O5..........................................      83      0.9       94      1.0      100      1.0       74      0.9       50      1.0       14      0.7
O6..........................................      19      0.7       22      0.8       29      0.6       34      0.6       14      0.7        0      0.0
O7..........................................       0      0.0        0      0.0        0      0.0        0      0.0        0      0.0        1      0.1
                                             -----------------------------------------------------------------------------------------------------------
    Total...................................     982   .......     924   .......     857   .......     783   .......     696   .......     627   .......
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Average TIC only includes DOS time only, not USIA time.


    Question. Is there a need for a midlevel hiring program to bring in 
experienced public relations/communications professionals to contribute 
to our public diplomacy efforts?

    Answer. Thanks to robust hiring of entry-level officers under the 
3-year Diplomatic Readiness Initiative, we have been able to fill many 
of the gaps that existed in our midranks just a few short years ago. 
Our midlevel public diplomacy officers receive in-depth training and 
are well prepared to meet the challenges of explaining U.S. policy 
abroad. We believe that under the experienced senior leadership in the 
Under Secretary for Public Diplomacy's office, these committed career 
professionals are doing an excellent job getting our message out.

    Question. Please provide for the committee a bureau-by-bureau 
description of the physical integration of public diplomacy officers 
into the regional and relevant functional bureaus (i.e., are they 
across town, across the street, in the same building, the same general 
area of the building, or colocated with the policy offices).

    Answer. Domestically assigned former USIA staff, apart from those 
in the Bureau of International Information Programs (IIP) and the 
Bureau of Educational and Cultural Affairs (ECA), are organizationally 
and physically integrated into the Department of State bureaus listed 
below. While many of these employees are housed within the Department 
headquarters, the Harry S Truman Building, there are also employees 
assigned to bureaus with offices located in various annexes within the 
District of Columbia (DC) metropolitan area. Approximately 800 IIP and 
ECA employees remain in the former USIA Headquarters Building (301 4th 
Street, SW, Washington, DC). However, the Department is working with 
the General Services Administration to identify potential office space 
so these employees could be relocated closer to the Harry S Truman 
Building.

    Question. Please describe their [public diplomacy officers in 
regional and functional bureaus] integration into State's lines of 
authority (i.e., do they receive taskings largely through a PD 
structure or are policy office directors and embassy front offices 
managing their day-to-day activities)?

    Answer. Public diplomacy officers in regional and functional 
bureaus and in embassies overseas are fully integrated into the 
bureaus' structure and the embassy country teams. In the Department, 
they report to a Deputy Assistant Secretary in each of the bureau front 
offices, and overseas, the Public Affairs Officer (PAO) reports 
directly to the Deputy Chief of Mission (DCM). In addition, Under 
Secretary Karen Hughes has recently introduced a network of Public 
Diplomacy Deputy Assistant Secretaries in each regional bureau who 
report both to the bureau assistant secretary and to her. This ensures 
a direct reporting arrangement to the Under Secretary for the public 
diplomacy function.

    Question. You have requested additional Public Diplomacy Program 
funding in FY07. How will those funds be used in the field to enhance 
our efforts?

    Answer. An increase of $10 million is requested for the Office of 
Public Diplomacy and Public Affairs to support public diplomacy 
objectives through engagement, empowerment, and evaluation.

Speaker Program Expansion
    With the $1,265,000 requested, the Department will create a new 
youth speaker program, modeled after the U.S. Speakers Program, in 
which Americans from a variety of walks of life are recruited to travel 
and participate in programs developed especially to engage younger 
groups. This proposal will provide a more strategic focus for the U.S. 
Speaker Program to sustain and reinforce interaction with targeted 
overseas audiences using a mix of communication tools, including 
videoconferencing and Web-based techniques.

Arabic and Chinese Language Services
    The requested funding of $1,700,000 will expand the Department's 
Arabic and Chinese language services by making more information 
available in those languages. The Department will provide a more 
complete offering of policy statements, texts, and transcripts and 
contextual materials, in formats that intended audiences (Arabic and 
Chinese speakers) are most comfortable with, for example, Web sites, 
listservs, Web-casting, text messaging, etc. Expanding Arabic language 
services will support U.S. foreign policy in the broader Middle East, 
while expanding Chinese language services will allow the Department to 
reach audiences in one of the fastest growing regions in the world.

American Corners
    The $3,200,000 requested addresses the President's charge to the 
public diplomacy community to engage with international audiences--to 
tell America's story and also listen to the stories of others. American 
Corners provide the logistical foundation for interactive dialog and in 
most countries, the only source for that dialog. American Corners make 
use of interactive technology and provide visitors access to material 
about the United States in a multimedia format. Expansion of American 
Corners will provide an opportunity to explore life and culture in the 
United States, and in many localities will provide one of the best 
places to obtain accurate and current information about economic, 
cultural, political, educational, and social trends in the United 
States.

Countering Disinformation and Discrediting Terrorists
    With the $2,000,000 requested, the Department will use a proactive 
approach to an effort to discredit terrorists and diminish their appeal 
to win the war on terror. The Bureau of International Information 
Programs (IIP) has created a program to debunk false stories about the 
United States. The program will expose un-Islamic behavior by 
terrorists; support partners in their campaigns to delegitimize 
extremists in their midst; and partner with foreign community leaders 
in public education campaigns against terrorism and the terrorist 
messages of hatred and violence.

Television (TV) Cooperatives and Media Broadcast Projects
    Television and video broadcasting products continue to be powerful 
strategic tools for bringing America's foreign policy message to 
worldwide audiences. The TV Co-Op program has proven to be one of the 
most critical components of the Department's overseas media outreach. 
The Department is seeking $585,000 to implement additional TV Co-Ops 
that will target Arab and Muslim audiences in order to build closer 
relationships, counter extremists, enhance the credibility of the 
United States and reestablish the image of the United States as a 
partner for positive change.

Evaluating and Polling
    With the $1,250,000 requested, the Department will establish a 
fully effective, performance-based executive direction and evaluation 
capability. The Evaluation Unit will develop a ``culture of 
measurement'' by training Public Diplomacy Program managers on program 
planning, including needs assessments, audience research, and early 
planning for monitoring and evaluation; designing and implementing 
outcome assessments; and creating a centralized program planning, 
management and performance database that will include planning 
guidelines, needs assessment information, audience analysis data, and 
evaluation findings. The Department will also expand its polling and 
survey program in Arab and Muslim-majority countries to address 
negative views of the Unites States, U.S. policy, and the war on 
terrorism in those Muslim-majority and Arab countries.

                       PALESTINIAN POLICY AND AID

    Question. Your strategy for dealing with a Hamas-led Palestinian 
Authority appears to rely upon President Abbas as a counterweight. But 
we systematically built up the Prime Minister's position--rather than 
his--over the past few years and his record to date is one of 
indecision and weak leadership. How do you envision moving ahead?

    Answer. Our policy decision regarding the Office of the President 
and the person of President Mahmoud Abbas is clear: We intend to 
maintain contact with the interim government under his leadership until 
a new government takes charge. President Abbas has outlined his program 
for peace and mandated the new PA government to be formed to commit 
itself to these policies of partnership.
    The international community has made clear that a new Palestinian 
Authority government must disavow terror and violence, recognize 
Israel's right to exist, and accept previous obligations and agreements 
between the parties. This was the position taken by the Quartet--the 
United States, European Union, Russia, and United Nations--in their 
statement of January 30.
    These requirements are based upon longstanding principle and are 
applicable to any Palestinian Government. But as Secretary Rice has 
said, Hamas, as the majority party in the new Palestinian Legislative 
Council, will now have to bear responsibility for the decisions it 
makes and face up to the consequences of those decisions, which will 
shape the international community's approach to issues involving the 
Palestinians and regional peacemaking efforts.
    We believe that it is critical that there be a Palestinian partner 
for peace, and we intend to maintain a dialog with President Abbas. Our 
assistance program for the Palestinians is currently subject to an 
interagency review. We will advise the Congress of the outcome of that 
review, and consult further on next steps upon the completion of that 
process.

    Question. Your FY07 request includes $150 million for aid to 
Palestinians, appropriately caveated to indicate a review is under way 
in light of the outcome of the January 25 elections. Quite aside from 
political turmoil, it is clear that an economic crisis is brewing: The 
stock market in Nablus has already lost 25 percent of its 
capitalization; the fresh produce from Gaza which was intended to be a 
mainstay of its economy is rotting, unable to reach Ben Gurion Airport 
for transport to export markets in Europe; the ability of the 
Palestinian Authority to pay teachers and health workers after this 
month is in grave doubt. How can we address this under current 
circumstances?

    Answer. With the expected formation of a Hamas-led Palestinian 
Authority (PA) government, a comprehensive interagency review of all 
USG assistance to the Palestinians is underway. This review will ensure 
that our assistance continues to reflect U.S. policy goals and fully 
complies with U.S. law; it is informed by our abiding commitment to 
meeting the basic humanitarian needs of the Palestinian people. We will 
advise the Congress of the outcome of that review, and consult further 
on next steps upon the completion of that process.
    Until a new government is formed, we are cooperating with the 
international community to facilitate the work of the caretaker 
government and ease the suffering of average Palestinians. We have 
worked closely with Arab governments and the international community to 
stabilize the finances of the interim PA government. The European Union 
has promised to provide approximately $140 million in support to the 
caretaker government to cover salaries, utility bills, and humanitarian 
needs. In February, the Qataris transferred $14 million, enabling the 
PA to pay its January wage bill, while the UAE has promised additional 
support, which we expect would help the PA pay February wages. For its 
part, while Saudi Arabia continues its $15.4 million bimonthly 
transfers, it has yet to deliver on its additional pledged support.
    Ultimately, as the majority party in the new Palestinian 
Legislative Council, the burden falls on Hamas to fulfill the peaceful 
aspirations of the Palestinian people and create a climate that 
encourages stability and economic growth. Hamas can only achieve these 
outcomes by committing to the three principles laid out by the Quartet 
(the United States, European Union, United Nations, and Russia) in its 
January 30 statement: Renouncing violence, recognizing Israel, and 
accepting prior agreements and obligations, including the roadmap. As 
Secretary Rice has said, Hamas will now have to bear responsibility for 
the decisions it makes and face the consequences of those decisions.
Lebanon
    Question. Are you satisfied with the level of cooperation by the 
Syrian regime with the United Nations investigation? Does that 
investigation have the resources it requires? Should the investigation 
be expanded to examine other politically motivated killings in Lebanon?

    Answer. We have not been satisfied with the level of the Syrian 
regime's cooperation with the UNIIIC investigation; the two prior 
reports of the Commission reflect a distinct lack of Syrian 
cooperation. As I said in my statement on January 11, 2006, we continue 
to call upon the Syrian regime to respond positively to the requests of 
U.N. Independent International Investigation Commission (UNIIIC). The 
Syrian regime must cease obstructing the investigation into the 
assassination of former Lebanese Prime Minister Hariri and cooperate 
fully, as required by U.N. Security Council resolutions. We intend to 
refer this matter back to the Security Council if Syrian obstruction 
continues.
    We continue to work with our colleagues on the United Nations 
Security Council to ensure that the UNIIIC has adequate resources at 
its disposal. The United States stands firmly with the people of 
Lebanon in the pursuit of justice and bringing the investigation to its 
ultimate conclusion.
    U.N. Security Council Resolution 1644, unanimously adopted by the 
UNSC, authorizes the United Nations to extend assistance to the 
Lebanese Government's investigations into the other assassinations. We 
fully support this process. Continuing assassinations in Lebanon of 
opponents of Syrian domination, including most recently the murder of 
journalist and Member of Parliament, Gebran Tueni, on December 12, 
2005, create an atmosphere of fear that Syria uses to intimidate 
Lebanon. Syria must cease this intimidation and immediately come into 
compliance with all relevant Security Council resolutions.

    Question. Assuming senior Syrian officials are shown to be 
complicit, would you support their referral to the International 
Criminal Court, expanding the mandate of either of the existing 
International Tribunals (Yugoslavia, Rwanda), or creating a new 
tribunal?

    Answer. In unanimously adopting UNSC Resolution 1644, the U.N. 
Security Council began the process of determining what international 
trial elements are needed to assist Lebanon in seeking justice for the 
assassination of former Prime Minister Hariri. In operative paragraph 6 
of the resolution, the Security Council ``Acknowledges the Lebanese 
Government's request that those eventually charged with involvement in 
this terrorist attack be tried by a tribunal of an international 
character, requests the Secretary General to help the Lebanese 
Government identify the nature and scope of the international 
assistance needed in this regard, and requests also the Secretary 
General to report to the Council in a timely manner.''
    The Lebanese Government's legal team is consulting with the United 
Nations on possible mechanisms for a Lebanese tribunal with 
international elements. We anticipate the Secretary General will report 
on this matter, and the United States will study the report.
    The International Criminal Court (ICC) is not a realistic option, 
including because the jurisdiction of the ICC is restricted to 
genocide, war crimes, and crimes against humanity, none of which apply 
to the Hariri assassination.

    Question. The President's FY 2007 budget includes a 500-percent 
increase in FMF for Lebanon. For what is this intended?

    Answer. As the Lebanese Government implements political, economic, 
and institutional reforms, we have a key opportunity to fill the void 
left by the withdrawal of Syrian troops by assisting the Lebanese Armed 
Forces develop into a unifying national institution with the capacity 
to assert its sovereignty and deploy throughout the country, as called 
for in UNSC Resolution 1559.
    FMF is a critical tool to supporting the process of rebuilding and 
restoring the operational readiness of the Lebanese Armed Forces to 
accomplish U.S. goals as outlined in UNSCR 1559 and 1614. Lebanon 
received no FMF in FY 2005, and only $990,000 in FY 2006. The FY 2007 
request is $4.8M. FMF in FY 2007 will enable follow-on support and 
ammunition to sustain existing inventories of U.S.-origin weapons, 
vehicles, and equipment. FY 2007 FMF will support the acquisition of 
repair parts and maintenance, ammunition, and body armor for the 
Lebanese Armed Forces. The increased amount of funding is critical in 
order to enhance the operational readiness of the Lebanese Armed 
Forces.
                                 ______
                                 

                 Questions of Senator George Voinovich

    Question. The FY 2007 budget request reflects a proposed decrease 
in Assistance for Eastern Europe and the Baltic States, from $357 
million to $273 million, a decrease of 23 percent. Bulgaria, Croatia, 
and Romania have been phased out in FY 2007 and will receive no funding 
in FY 2007. Additionally, there are decreases across the board for 
other countries, including a 16-percent decrease for Serbia and 
Montenegro.
    Please discuss the State Department's rationale for decreasing SEED 
funding and plans for phasing out the remaining SEED recipient nations. 
Specifically, does the State Department believe that programs in the 
areas of rule of law, democracy, anticorruption, and other areas are 
nearing completion in Southeast Europe? Several reports indicate that 
corruption remains rampant through the region and there is much work to 
do to institute rule of law, democracy, and judicial capabilities 
throughout the region. Please comment on the vision of U.S. assistance 
to Southeast Europe.

    Answer. In FY 2007, SEED assistance will continue to promote a 
Europe that is whole and free, grounded in democratic principles and 
the rule of law, prospering in a market economy, and integrated into 
Euro-Atlantic institutions. Our work includes stabilizing war-torn 
Southeast Europe; supporting transition resulting from Kosovo status 
talks and a possible Montenegrin independence referendum; supporting 
progress toward democracy and market economies in which transparency 
and competition replace corruption and cronyism; strengthening U.S. 
partners in the war on terror; and promoting Euro-Atlantic integration.
    Two countries that will phase out of SEED funding in FY 2007, 
Bulgaria and Romania, have signed accession agreements with the 
European Union in anticipation of joining as early as January 1, 2007 
(with a ``safeguard'' clause that could put off accession until 2008). 
Like these countries, Croatia will not receive FY 2007 SEED funds as it 
has made significant progress on economic and democratic reforms and 
looks to possible EU accession as early as 2009. All three countries 
received significant preaccession aid from the European Union in 2005.
    Kosovo and Serbia, which are requested at $79 million and $62 
million respectively, would receive the bulk of SEED funding in FY 
2007--an important transition period resulting from the Kosovo final 
status talks. For Bosnia, $31 million is requested for supporting 
reform as it institutes a new, more independent constitutional 
structure with state-level ministries.
    Our request for Macedonia is $27 million. The European Union named 
Macedonia a candidate country in December 2005. SEED assistance to 
Albania is requested at $20 million; Albania just initialed a 
Stabilization and Association Agreement with the European Union. The 
request for Montenegro is $8.5 million. In each of these countries (or 
republics), we will continue anticorruption assistance and support to 
the justice sector. Since important work remains in the region to 
address justice sector reform, SEED funding in this sector will not 
phase out as early as in other sectors, as displayed in the chart 
below.
    Plans for bilateral SEED assistance budgets also had to be 
considered against the need to fund the U.S. contribution to the OSCE 
(FY 2007 is the third year the SEED budget will fund U.S. contributions 
to the OSCE), as well as expenses for the Office of the High 
Representative (OHR) in Bosnia and Herzegovina. The FY 2007 OSCE 
request is $28.5 million, up from $24.4 million in FY 2006, due to 
growing OSCE contributions.

----------------------------------------------------------------------------------------------------------------
                                                                                                         Law
                                                            Economic     Democratic      Social      enforcement
----------------------------------------------------------------------------------------------------------------
Sector or program phaseouts--SEED assistance:
    Albania.............................................       2013          2013          2014+         2014+
    Macedonia...........................................       2010          2010          2010          2011
    Serbia/Montenegro...................................       2010          2011          2011          2014+
Sector or program phaseouts 10 or more years:
    Bosnia..............................................       2014+         2014+         2014+         2014+
(No phase out has been developed for Kosovo assistance)
----------------------------------------------------------------------------------------------------------------


    Question. Please clarify how funds be allocated within Europe and 
Eurasia for Nonproliferation, Anti-Terrorism, Demining, and Related 
Programs (NADR), including with the Export Control and Border Security 
(EXBS) funds.

    Answer. The NADR account crosscuts several key areas of our foreign 
policy concerns by supporting nonproliferation activities to prevent, 
security, and containing WMD; strengthening international agreements on 
nonproliferation constraints; and ensures peaceful cooperation 
regarding nuclear safety; preventing and countering terror attacks on 
U.S. interests at home and abroad; and promoting peace and regional 
stability, while meeting humanitarian needs in post-conflict 
environments including nonproliferation, counterterrorism, and 
humanitarian assistance.
    Four offices within the Bureau of International Security and 
Nonproliferation expend NADR program funds. The Nonproliferation and 
Disarmament Fund is requesting $38 million for FY 2007. The NDF will 
not know how its FY 2007 funds will be allocated until the third or 
fourth quarter of the fiscal year owing to the nature of NDF 
operations, but during the last 5 years a majority of its program funds 
have been expended in Europe and Eurasia, though only about 20 percent 
of NDF's projects to date are in the former Soviet Union. The NWMDE 
programs are requesting $56.2 million for FY 2007. NWMDE will continue 
to expend the majority of its program funds in the former Soviet Union. 
With the resources from the Iraq Relief and Reconstruction Fund (IRRF) 
and NDF it has only been in recent years that it has started scientist 
redirection programs in Iraq and Libya and they make up less than 5 
percent of the total program spending. The Office of Multilateral 
Nuclear and Security Affairs is requesting $50 million for the 
voluntary contribution to the International Atomic Energy Agency. These 
funds are used primarily for the IAEA's safeguards, technical 
cooperation, nuclear security, and nuclear safety programs, of which a 
significant portion goes to programs in Europe and Eurasia. For 
example, approximately 25 percent of IAEA technical cooperation funds 
were expended in 2004, the last year for which figures are available. 
ISN is also requesting $19.8 million for its contribution to the 
International Monitoring System, which operates globally.
    EXBS is requesting $45.05 million for FY 2007. Of that, $17.495 
million would be expended for EXBS program initiatives in Europe and 
Eurasia. It is anticipated that Slovenia will graduate to join Poland, 
the Czech Republic, Hungary, Estonia, Latvia, Lithuania, Romania, and 
Bulgaria in the limited sustainment phase of the EXBS program. In 
Southeast Europe, EXBS will concentrate on developing legal/regulatory 
and licensing infrastructures as well as increasing interdiction and 
investigation capabilities. In Turkey, EXBS will concentrate on 
providing more sophisticated WMD interdiction equipment and on 
fostering greater government outreach to industry. EXBS will focus on 
improving customs and border guards enforcement in Russia, Ukraine, 
Tajikistan, and Kazakhstan.
    FY 2007 will mark the first year for an EXBS program in Georgia, 
which will focus on enhancing border security, effective legal/
regulatory and licensing infrastructure for strategic trade 
enforcement, and outreach to dual-use industries to assist them in 
establishing internal compliance. EXBS will be equipping key smuggling 
routes in Central Asia and the Caucasus with inspection and radiation 
detection equipment and supporting efforts in the Caspian Sea area to 
detect and interdict WMD-related technology proliferation. EXBS will 
also deploy a new Maritime advisor in Albania.
    The Bureau of Political-Military Affairs utilizes funds from three 
NADR subaccounts: Humanitarian Demining, the International Trust Fund 
for Humanitarian Demining (ITF), and Small Arms and Light Weapons (SA/
LW) destruction. The humanitarian demining request includes $1.5 
million to continue demining in the region of Abkhazia in Georgia with 
the objective of declaring Abkhazia mine and unexploded ordnance impact 
free by the end of 2007. We also plan to support increased demining 
capacity in Azerbaijan to meet the national strategic objective of 
clearance of all accessible areas by 2008. The $10 million requested 
for the ITF in FY 2007 will continue our mine action support in South 
East Europe. Our funds leverage an equal amount of matched funds from 
other national and international donors to foster humanitarian mine 
action in the region. ITF funds support comprehensive humanitarian mine 
action programs in Albania, Bosnia-Herzegovina, Croatia, Serbia and 
Montenegro, Macedonia, and the province of Kosovo. The
SA/LW destruction program has requested $8.6 million in FY 2007 funds. 
Approximately half of these funds would be expended in Europe and 
Eurasia, primarily to support continued reduction of large and aging 
stockpiles of SA/LW and associated munitions, including man-portable 
air-defense systems (MANPADS).
    The Office of the Coordinator for Counterterrorism (S/CT) is 
requesting NADR funds for FY 2007 for the Anti-Terrorism Assistance 
Program (ATA), the Counterterrorism Financing Assistance Program (CTF), 
the Terrorist Interdiction Program (TIP), and CT Engagement with 
Allies. The ATA Program uses NADR funds to provide training and 
enabling equipment at the strategic, operational, and tactical levels 
to law enforcement officials of foreign nations allied with the United 
States in the global war on terrorism, but lacking in the expertise 
and/or resources to effectively engage the threat. Of the $135.6 
million requested for ATA for FY 2007, $6.6 million would be used to 
support assistance planned for Albania, Armenia, Bosnia and 
Herzegovina, Georgia, Macedonia, Turkey, and some regional activities. 
The CTF Assistance Program uses NADR funds to provide training and 
technical assistance with the objective of building sustainable, 
dynamic antimoney laundering and counterterrorist financing regimes 
that adhere to international standards and implement effective programs 
in the legal, financial regulatory, financial intelligence, law 
enforcement, prosecutorial, judicial and international cooperation 
fields. Of the $9.08 million requested for CTF for FY 2007, $200,000 
would be used for programs in Bosnia and Herzegovina and Turkey. TIP 
strives to constrain terrorists' freedom of movement between countries 
by providing participating nations with a computer-based watch listing 
system enabling immigration and border control officials to quickly 
identify suspect persons attempting to enter or leave the country. TIP 
also provides participating nations with increased capability to 
collect traveler data and contribute to the global effort to understand 
terrorist methods and track their movements. Of the $11.8 million 
requested for TIP for FY 2007, $500,000 would be used for funding 
deployment of the Personal Identification Secure Comparison and 
Evaluation System (PISCES) to Georgia and Macedonia and to sustain/
upgrade existing programs in Kosovo and Malta. Finally, NADR funds for 
CT Engagement with Allies programs could be used to sponsor conferences 
to foster regional cooperation on maritime security/terrorist 
interdiction, mainstream Muslims' engagement against extremism, border 
security, and interdiction of weapons of mass destruction and their 
components. Of the $1 million requested for CT Engagement for FY 2007, 
$100,000 would be used to help fund an Organization for Security and 
Cooperation in Europe (OSCE) hosted workshop for regional 
counterterrorism organizations to coordinate efforts, exchange best 
practices, and identify areas for future joint action.

    Question. Please clarify the State Department's policy regarding 
International Military Education Training (IMET) funds and article 98 
agreements. Provide a list of the countries that have been prohibited 
from receiving IMET assistance because they have not yet signed an 
article 98 agreement. Of these countries, which countries are actively 
seeking membership in both NATO and the European Union? Considering 
IMET funding promotes U.S. goals of interoperability, Western military 
ideology, and bilateral military exchanges, does restricting IMET 
hinder progress for NATO membership, MAP, or PfP goals? The President 
waived article 98 requirements for the NATO aspirants. Please comment 
on whether the State Department has given consideration to requesting a 
waiver provision for the countries actively seeking NATO membership 
(with U.S. support and encouragement) so that they can receive IMET 
without an article 98 agreement?

    Answer. The prohibitions that Congress included in the American 
Servicemembers' Protection Act (ASPA) have been useful in securing many 
of the 101 article 98 agreements we have signed to date. These are 
important agreements to protect U.S. persons from illegitimate 
assertions of jurisdiction over all U.S. persons--particularly our 
servicemembers acting overseas. We have authority in the ASPA to waive 
the prohibitions for important national interests and are now reviewing 
the remaining IMET prohibitions on countries that have not yet signed 
an article 98 agreement to determine whether this prohibition is still 
helpful to our efforts to secure article 98 agreements and whether it 
is important to our national interest to restart IMET programs with 
these countries even in the absence of article 98 agreements.
    Kenya, Lesotho, Mali, Namibia, Niger, South Africa, Tanzania, 
Samoa, Croatia, Malta, Serbia-Montenegro, Barbados, Bolivia, Brazil, 
Costa Rica, Ecuador, Mexico, Paraguay, Peru, St. Vincent and 
Grenadines, Trinidad and Tobago, Uruguay, and Venezuela are all 
currently prohibited from receiving IMET assistance because they are 
International Criminal Court members and have not yet signed an article 
98 agreement.

    Question. Public diplomacy is a key priority of mine. I am very 
interested in how the FY 2007 State Department budget addresses a 
variety of key issues in the area of public diplomacy. Please elaborate 
on how new funds will be allocated to advance public diplomacy. Please 
explain whether the State Department will use funds to provide 
additional personnel in the area of public diplomacy or additional 
training for public diplomacy officers. Please elaborate on how the 
State Department will increase funding for language specialists and 
foreign language training in Arabic, Chinese, and other critical areas. 
Will the State Department also use public diplomacy funding to increase 
educational exchange programs with countries in the Middle East? Which 
countries and how much?

    Answer. The Under Secretary for Public Diplomacy and Public Affairs 
has developed a strategic framework to ensure that America's ideas and 
ideals prevail. This framework has three key objectives:

   To offer a positive vision of hope that is rooted in 
        America's freedom agenda;
   To isolate and marginalize extremists and undermine their 
        attempts to appropriate religion; and
   To foster a sense of common interests and values between 
        Americans and people of different countries, cultures, and 
        faiths.

    An increase of $10 million is requested for public diplomacy to 
support these objectives through engagement, empowerment, and 
evaluation.

Speaker Program Expansion
    With the $1,265,000 requested, the Department will create a new 
youth speaker program, modeled after the U.S. Speakers Program, in 
which Americans from a variety of walks of life are recruited to travel 
and participate in programs developed especially to engage younger 
groups. This proposal will provide a more strategic focus for the U.S. 
Speaker Program to sustain and reinforce interaction with targeted 
overseas audiences using a mix of communication tools, including 
videoconferencing and Web-based techniques.

Arabic and Chinese Language Services
    The requested funding of $1,700,000 will expand the Department's 
Arabic and Chinese language services by making more information 
available in those languages. The Department will provide a more 
complete offering of policy statements, texts, and transcripts and 
contextual materials, in formats that intended audiences (Arabic and 
Chinese speakers) are most comfortable with, for example, Web sites, 
listservs, Web-casting, text messaging, etc. Expanding Arabic language 
services will support U.S. foreign policy in the broader Middle East, 
while expanding Chinese language services will allow the Department to 
reach audiences in one of the fastest growing regions in the world.

American Corners
    The $3,200,000 requested addresses the President's charge to the 
public diplomacy community to engage with international audiences--to 
tell America's story and also listen to the stories of others. American 
Corners provide the logistical foundation for interactive dialog and in 
most countries, the only source for that dialog. American Corners make 
use of interactive technology and provide visitors access to material 
about the United States in a multimedia format. Expansion of American 
Corners will provide an opportunity to explore life and culture in the 
United States, and in many localities will provide one of the best 
places to obtain accurate and current information about economic, 
cultural, political, educational, and social trends in the United 
States.

Countering Disinformation and Discrediting Terrorists
    With the $2,000,000 requested, the Department will use a proactive 
approach to an effort to discredit terrorists and diminish their appeal 
to win the war on terror. The Bureau of International Information 
Programs (IIP) has created a program to debunk false stories about the 
United States. The program will expose un-Islamic behavior by 
terrorists; support partners in their campaigns to delegitimize 
extremists in their midst; and partner with foreign community leaders 
in public education campaigns against terrorism and the terrorist 
messages of hatred and violence.

Television (TV) Co-Operatives and Media Broadcast Projects
    Television and video broadcasting products continue to be powerful 
strategic tools for bringing America's foreign policy message to 
worldwide audiences. The TV Co-Op program has proven to be one of the 
most critical components of the Department's overseas media outreach. 
The Department is seeking $585,000 to implement additional TV Co-Ops 
that will target Arab and Muslim audiences in order to build closer 
relationships, counter extremists, enhance the credibility of the 
United States and reestablish the image of the United States as a 
partner for positive change.

Evaluating and Polling
    With the $1,250,000 requested, the Department will establish a 
fully effective, performance-based executive direction and evaluation 
capability. The Evaluation Unit will develop a ``culture of 
measurement'' by training Public Diplomacy Program managers on program 
planning, including needs assessments, audience research, and early 
planning for monitoring and evaluation; designing and implementing 
outcome assessments; and creating a centralized program planning, 
management, and performance database that will include planning 
guidelines, needs assessment information, audience analysis data, and 
evaluation findings. The Department will also expand its polling and 
survey program in Arab and Muslim-majority countries to address 
negative views of the Unites States, U.S. policy, and the war on 
terrorism in those Muslim-majority and Arab countries.
    Costs associated with the establishment of new American officer 
positions are not a component of the Department's PD request. The 
Department is requesting an additional 70 positions, which may include 
public diplomacy positions, to support transformational diplomacy as 
part of the overall FY 2007 Diplomatic and Consular Programs funding 
request.
    The Department's training program for public diplomacy officers, 
including language training, is the principal responsibility of the 
Foreign Service Institute, which has an innovative training strategy 
designed to directly support new and emerging policy and management 
priorities. PD training courses that are presently being offered to 
American officers are being reviewed in an effort to insure that 
evolving public diplomacy concepts and practices are being clearly 
disseminated. The Department will utilize additional funding requested 
in the Educational and Cultural Exchanges appropriation to address 
exchange programs with countries in the Middle East.
                                 ______
                                 

        ABC News Poll Submitted for the Record by Senator Lugar

        [From ABC News Poll: Life in Afghanistan, Dec. 7, 2005]

   Despite Deep Challenges in Daily Life, Afghans Express a Positive 
                                Outlook

    Four years after the fall of the Taliban, Afghans express both vast 
support for the changes that have shaken their country and remarkable 
optimism for the future, despite the deep challenges they face in 
economic opportunity, security and basic services alike.
    An ABC News poll in Afghanistan--the first national survey there 
sponsored by a news organization--underscores those challenges in a 
unique portrait of the lives of ordinary Afghans. Poverty is deep, 
medical care and other basic services lacking and infrastructure 
minimal. Nearly six in 10 have no electricity in their homes, and just 
three percent have it around the clock. Seven in 10 Afghan adults have 
no more than an elementary education; half have no schooling 
whatsoever. Half have household incomes under $500 a year.



    Yet despite these and other deprivations, 77 percent of Afghans say 
their country is headed in the right direction--compared with 30 
percent in the vastly better-off United States. Ninety-one percent 
prefer the current Afghan government to the Taliban regime, and 87 
percent call the U.S.-led overthrow of the Taliban good for their 
country. Osama bin Laden, for his part, is as unpopular as the Taliban; 
nine in 10 view him unfavorably.
    Progress fuels these views: Despite the country's continued 
problems, 85 percent of Afghans say living conditions there are better 
now than they were under the Taliban. Eighty percent cite improved 
freedom to express political views. And 75 percent say their security 
from crime and violence has improved as well. After decades of 
oppression and war, many Afghans see a better life.



    More can be done; most say each of these is better, but not 
``much'' better, than under the Taliban. And in a fourth crucial area--
jobs and economic opportunity--progress is badly lacking: In this basic 
building block, just 39 percent see improvement.
    In a separate measure, Afghans by nearly 2-1, 64-34 percent, say 
their own household's financial situation is bad (most Americans, by 
contrast, say theirs is good). Yet that economic discomfort has not 
produced political dissatisfaction: Ratings of President Hamid Karzai, 
the current government and the newly elected parliament are all high.
    Better hopes for the future are a likely reason. This poll finds 
broad expectations--expressed by two-thirds of Afghans--that life 
overall will improve in the year ahead. That optimism, while 
encouraging, also carries the danger of discontent if those 
expectations go unmet.
    This survey was conducted for ABC News by Charney Research of New 
York with field work by the Afghan Center for Social and Opinion 
Research in Kabul. Trained Afghan researchers interviewed a randomly 
selected sample of 1,039 adults across the country.
    CONCERNS--Some results may raise particular concerns. One is that, 
despite broadly favorable views of the United States, three in 10 
Afghans say attacks against U.S. forces can be justified. There are 
about 18,000 U.S. troops in Afghanistan, with more than 250 killed to 
date--including nearly twice as many in 2005 as in any previous year.
    Acceptability of attacks on U.S. forces spikes among disaffected 
and socially conservative Afghans, who account for about 15 percent of 
the population. In this group just 29 percent say such attacks cannot 
be justified, compared with 60 percent of all Afghans.
    At the same time, even among all Afghans, 30 percent say such 
attacks can be justified. That may reflect social mores in a country 
where violence is not an uncommon means of settling disputes, and 
perhaps specific grievances in areas where administrative or legal 
remedies are lacking.



    In another result that may give pause, one in four Afghans say 
there are circumstances in which it's acceptable to grow poppies for 
opium production, a trade that's soared since the Taliban were ousted. 
Acceptance of poppy farming--if no alternative source of income is 
available--reaches 41 percent in the highest opium-producing provinces 
as identified by the United Nations last year. And acceptability soars 
in the two provinces that historically have been the country's centers 
of poppy cultivation, Nangarhar in the East and Helmand in the West. 
(While cultivation in Nangarhar reportedly is down sharply this year, 
it appears that attitudes that tolerate it have not followed.)
    Many fewer Afghans--just five percent--say poppy cultivation is 
acceptable in all cases; more say, rather, that it's acceptable only if 
no alternatives are available. That suggests that the opium trade may 
be vulnerable, to the extent other income-earning opportunities--such 
as the cultivation of alternative crops--can be provided in its place. 
But it won't be easy: The United Nations estimates that one in 10 
Afghans is involved in cultivating opium poppies.

                          GROWING OPIUM POPPIES
------------------------------------------------------------------------
                                         Acceptable
                               ------------------------------     Not
                                       In all       If no     acceptable
                                Net     cases    alternative
------------------------------------------------------------------------
All Afghanistan...............  26%          5           21          73
Non-opium provinces...........  19           3           17          79
Opium provinces*..............  41           9           32          57
Nangarhar & Helmand...........  75          20           55          25
------------------------------------------------------------------------
* Opium poppy >10% of cereal cultivation, per U.N. 2004.



    The survey also finds substantial suspicion of cheating in the 
recent parliamentary elections. Nearly half of Afghans, 46 percent, 
believe there was vote buying, intimidation of voters or cheating in 
the vote count in their area. Still, 77 percent are confident 
nonetheless that the parliament will work for the benefit of the 
people, although far fewer, 34 percent, are ``very'' confident that 
will be the case.
    In terms of threats the country faces, most-cited is the Taliban, 
an insurgent group since it was ousted with the fall of Kandahar on 
Dec. 7, 2001. Forty-one percent call the Taliban the biggest danger to 
Afghanistan, 28 percent cite drug traffickers and 22 percent say it's 
local warlords. (The program to disarm those warlords enjoys vast 
popular support, detailed below.)




    WOMEN--The survey also finds broad majority support for women's 
rights in Afghan society, albeit, as in other readings, with more 
modest strength of commitment behind it. Nine in 10 Afghans support 
girls' education and women voting, three-quarters support women holding 
jobs and two-thirds support women holding government office--remarkable 
in a country where the Taliban so thoroughly repressed such rights. 
Perhaps surprisingly, support for most of these is nearly as high among 
men as it is among women.

------------------------------------------------------------------------
                                                              Women  Men
------------------------------------------------------------------------
Support for:
  Girls' education..........................................  93%    92%
  Women voting..............................................   92    87
  Women holding jobs........................................   78    69
  Women holding gov't office................................   71    59
------------------------------------------------------------------------

    At the same time, while 89 percent of Afghans support women voting, 
fewer, 66 percent, strongly support this right. And only about four in 
10 ``strongly'' support women taking jobs outside the home or holding 
government office. Even among Afghan women, fewer than half strongly 
support women working outside the home or holding government office. 
Personal experience may be a factor: Just 14 percent of Afghan women 
are employed, compared with about 60 percent of women in the United 
States.
    There also are ethnic and regional differences, with support for 
women's rights much lower among Afghanistan's Pashtun population, Sunni 
Muslims who are dominant in the South and East of the country.



    Also, support for women holding political office, in particular, is 
much weaker in rural as opposed to urban areas, and weakest among rural 
men.

Support for women holding political office:
    All--65%
    Urban--87%
    Rural--59%
    Rural men--51%
    Rural women--67%

    CURRENT CONDITIONS--Afghans give positive reports to several 
aspects of their daily lives: Eighty-three percent rate their overall 
living conditions positively, and ratings are nearly as high both for 
local schools and the availability of food. Just over seven in 10 
likewise say their security from crime and violence is good. In each of 
these, though, far fewer--ranging from just 15 percent to 28 percent--
say things are ``very'' good.
    Fewer overall, 59 percent, say clean water is readily available, 
and other basic conditions--medical care, jobs and economic 
opportunity, roads and bridges and power supply--are rated far worse.

                     LOCAL CONDITIONS IN AFGHANISTAN
------------------------------------------------------------------------
                                                              Good  Very
                                                             (net)  good
------------------------------------------------------------------------
Overall living conditions..................................  83%    15%
Local schools..............................................   80     25
Availability of food.......................................   78     22
Security from crime/violence...............................   72     28
Availability of clean water................................   59     18
Medical care...............................................   44     12
Jobs/economic opportunity..................................   35      5
Roads, bridges, etc........................................   24      2
Electricity supply.........................................   17      4
------------------------------------------------------------------------

                                                                    
                                                                    
    There are significant differences in conditions across the country. 
Security is better in urban areas (of which the largest by far is 
Kabul, where about one in seven Afghan adults live); 40 percent in 
urban areas describe their security as ``very good,'' compared with 24 
percent in rural areas.
    Both security and economic conditions are notably worse in the 
Southwest and East (where the Taliban have been active) than elsewhere. 
And services seem weakest in the Northwest, where fewer than two in 10 
report having clean water, good medical care or good roads, bridges and 
other infrastructure. In Kabul, just 18 percent lack any electrical 
power; that soars to more than two-thirds in the North and East.
    SECURITY--Security is especially critical in a country so long 
wracked by war. When the 77 percent of Afghans who say the country is 
headed in the right direction are asked in an open-ended question why 
they feel that way, three related answers dominate: Security, peace or 
the end of war, and disarmament.
    Mentions of freedom, democracy and reconstruction follow; women in 
particular mention freedom for women, who were repressed under the 
Taliban regime: Twenty percent of women (compared with four percent of 
men) cite freedom for women as a reason they say the country's going in 
the right direction.

Why is the country going in the right direction?

                       [Multiple answers accepted]

                                                              In percent
Security..........................................................    34
Peace/end of war..................................................    31
Disarmament.......................................................    27
Freedom/free speech...............................................    17
Democracy/elections...............................................    15
Reconstruction/rebuilding.........................................    15

    Similarly, when asked the single most important priority for the 
country, 40 percent of Afghans say security from crime and violence 
remains paramount. That's followed fairly closely by creating jobs and 
economic opportunities, then much more distantly by the need for 
infrastructure improvements. When first- and second-highest priorities 
are combined, however, these rank about evenly. There's much to do.

------------------------------------------------------------------------
                                                               first and
                                                      First     second
                                                    priority  priorities
------------------------------------------------------------------------
Security from crime/violence......................    40%        45%
Economic opportunities............................     31         49
Improving infrastructure..........................     14         45
------------------------------------------------------------------------

    Another expression of the importance of security comes in support 
for the country's ``DDR''--disarmament, demobilization and 
reintegration--program. Largely Japanese-funded, the program is said to 
have disarmed 70,000 fighters under local warlords, offering them 
vocational training in exchange for their weapons. Not only do 95 
percent of Afghans support the program, but 72 percent ``strongly'' 
support it, by far the highest level of strong support for any program, 
individual or entity measured in this survey.
    VIEWS OF THE U.S.--Eighty-three percent of Afghans express a 
favorable opinion of the United States overall, similar to the 87 
percent who call the U.S.-led overthrow of the Taliban a good thing. 
That compares to favorable ratings of a mere eight percent for the 
Taliban, and five percent for bin Laden. People who are unhappy with 
their local living conditions are twice as likely to have an 
unfavorable opinion of the United States.
    Support for the United States is less than full-throated. Far 
fewer, 24 percent, regard it ``very'' favorably. And while 68 percent 
rate the work of the United States in Afghanistan positively, that's 
well below the ratings given to Karzai, the United Nations or the 
present Afghan government (83, 82 and 80 percent positive, 
respectively).
    Still, an 83 percent favorable rating for the United States, and a 
68 percent positive work performance rating, are remarkable--in sharp 
contrast to negative views of the United States in many other Muslim 
nations. (Another contrast is Karzai's job rating--83 percent 
positive--compared with George W. Bush's in the United States, where 
just 39 percent of Americans approved in the last ABC News/Washington 
Post poll.)

------------------------------------------------------------------------
                                                   Ex./
                                                   Good  Excellent  Good
                                                    Net
------------------------------------------------------------------------
Rate the work of:
  Hamid Karzai as president......................  83%     45%      38%
  The United Nations in Afghanistan..............   82      33       49
  The Afghan government..........................   80      27       53
  The United States in Afghanistan...............   68      20       48
------------------------------------------------------------------------

    Given the Afghan public's security concerns--and distaste for the 
Taliban--there is little demand for prompt U.S. withdrawal from 
Afghanistan. Just eight percent say the United States should leave now, 
and only another six percent say it should withdraw within the next 
year. The most common answer by far: Sixty-five percent say U.S. forces 
should leave Afghanistan ``only after security is restored.''
    SHIITE/SUNNI--Notable in this survey is the similarity of views 
between Sunni and Shiite Muslims, the two doctrinal groups so sharply 
at odds in Iraq. As in most of the Arab world, Sunnis dominate in 
Afghanistan--85 percent of the population is Sunni (including nearly 
all members of the Pashtun and Tajik ethnic groups) while 15 percent is 
Shiite (including nearly all ethnic Hazaras).
    There are differences: Thirty-two percent of Sunnis say attacks on 
U.S. forces can be justified, compared with 19 percent of the Shiite 
minority. And 51 percent of Shiites describe the Taliban (a Sunni 
group) as the biggest danger facing the country, compared with a (still 
high) 39 percent of Sunnis.
    But few Sunnis or Shiites alike view the Taliban favorably (nine 
percent and six percent, respectively). Their ratings on improved 
conditions are similar, as are their expectations for the future and 
their views on Karzai, the current Afghan government, the United 
Nations, the United States, the ``DDR'' disarmament program and women's 
rights.
    WORK and POSSESSIONS--A simple accounting of household possessions 
tells volumes about life in Afghanistan. Barely one in 10 households 
has a refrigerator or a car. Three in 10 have a mobile phone; almost no 
one has a landline telephone. Nearly everyone has a radio, but barely 
four in 10 have a TV. About half own a work animal.

                                                              In percent
Household possessions:
    Radio.........................................................    95
    Bicycle.......................................................    63
    Work animal...................................................    47
    TV............................................................    43
    Mobile phone..................................................    31
    Motorbike.....................................................    26
    Car...........................................................    12
    Refrigerator..................................................    11
    Satellite dish................................................     9
    Landline phone................................................     1

    Farming is the main occupation; nearly a third of working Afghans 
are farmers or farm laborers. As befits the low levels of education, 
illiteracy is high, 42 percent.
    The population is largely rural, with 79 percent of Afghans 
residing in small villages. And it's a young country, with a median age 
(calculated among adults only) of 32 years, compared with 44 in the 
United States.
    METHODOLOGY--This survey was conducted for ABC News by Charney 
Research of New York, with field work by the Afghan Center for Social 
and Opinion Research in Kabul. Interviews were conducted in person, in 
Dari or Pashto, among a random national sample of 1,039 Afghan adults 
from Oct. 8-18, 2005. Sampling points were selected at random in 31 of 
Afghanistan's 34 provinces, with households selected by random route/
random interval. The results have a 3.5-point error margin. Details of 
the survey methodology are available upon request.

    [The full results of the ABC News poll can be found at http://
abcnews.go.com/US/PollVault/.]

                                  
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