[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
H.R. 180, THE DARFUR ACCOUNTABILITY
AND DIVESTMENT ACT OF 2007
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON
DOMESTIC AND INTERNATIONAL
MONETARY POLICY, TRADE, AND TECHNOLOGY
OF THE
COMMITTEE ON FINANCIAL SERVICES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
MARCH 20, 2007
__________
Printed for the use of the Committee on Financial Services
Serial No. 110-16
U.S. GOVERNMENT PRINTING OFFICE
35-408 PDF WASHINGTON DC: 2006
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HOUSE COMMITTEE ON FINANCIAL SERVICES
BARNEY FRANK, Massachusetts, Chairman
PAUL E. KANJORSKI, Pennsylvania SPENCER BACHUS, Alabama
MAXINE WATERS, California RICHARD H. BAKER, Louisiana
CAROLYN B. MALONEY, New York DEBORAH PRYCE, Ohio
LUIS V. GUTIERREZ, Illinois MICHAEL N. CASTLE, Delaware
NYDIA M. VELAZQUEZ, New York PETER T. KING, New York
MELVIN L. WATT, North Carolina EDWARD R. ROYCE, California
GARY L. ACKERMAN, New York FRANK D. LUCAS, Oklahoma
JULIA CARSON, Indiana RON PAUL, Texas
BRAD SHERMAN, California PAUL E. GILLMOR, Ohio
GREGORY W. MEEKS, New York STEVEN C. LaTOURETTE, Ohio
DENNIS MOORE, Kansas DONALD A. MANZULLO, Illinois
MICHAEL E. CAPUANO, Massachusetts WALTER B. JONES, Jr., North
RUBEN HINOJOSA, Texas Carolina
WM. LACY CLAY, Missouri JUDY BIGGERT, Illinois
CAROLYN McCARTHY, New York CHRISTOPHER SHAYS, Connecticut
JOE BACA, California GARY G. MILLER, California
STEPHEN F. LYNCH, Massachusetts SHELLEY MOORE CAPITO, West
BRAD MILLER, North Carolina Virginia
DAVID SCOTT, Georgia TOM FEENEY, Florida
AL GREEN, Texas JEB HENSARLING, Texas
EMANUEL CLEAVER, Missouri SCOTT GARRETT, New Jersey
MELISSA L. BEAN, Illinois GINNY BROWN-WAITE, Florida
GWEN MOORE, Wisconsin, J. GRESHAM BARRETT, South Carolina
LINCOLN DAVIS, Tennessee JIM GERLACH, Pennsylvania
ALBIO SIRES, New Jersey STEVAN PEARCE, New Mexico
PAUL W. HODES, New Hampshire RANDY NEUGEBAUER, Texas
KEITH ELLISON, Minnesota TOM PRICE, Georgia
RON KLEIN, Florida GEOFF DAVIS, Kentucky
TIM MAHONEY, Florida PATRICK T. McHENRY, North Carolina
CHARLES A. WILSON, Ohio JOHN CAMPBELL, California
ED PERLMUTTER, Colorado ADAM PUTNAM, Florida
CHRISTOPHER S. MURPHY, Connecticut MICHELE BACHMANN, Minnesota
JOE DONNELLY, Indiana PETER J. ROSKAM, Illinois
ROBERT WEXLER, Florida KENNY MARCHANT, Texas
JIM MARSHALL, Georgia THADDEUS G. McCOTTER, Michigan
DAN BOREN, Oklahoma
Jeanne M. Roslanowick, Staff Director and Chief Counsel
Subcommittee on Domestic and International Monetary Policy, Trade, and
Technology
LUIS V. GUTIERREZ, Illinois, Chairman
CAROLYN B. MALONEY, New York RON PAUL, Texas
MAXINE WATERS, California MICHAEL N. CASTLE, Delaware
PAUL E. KANJORSKI, Pennsylvania FRANK D. LUCAS, Oklahoma
BRAD SHERMAN, California STEVEN C. LaTOURETTE, Ohio
GWEN MOORE, Wisconsin DONALD A. MANZULLO, Illinois
GREGORY W. MEEKS, New York WALTER B. JONES, Jr., North
DENNIS MOORE, Kansas Carolina
WM. LACY CLAY, Missouri JEB HENSARLING, Texas
KEITH ELLISON, Minnesota TOM PRICE, Georgia
CHARLES A. WILSON, Ohio PATRICK T. McHENRY, North Carolina
ROBERT WEXLER, Florida MICHELE BACHMANN, Minnesota
JIM MARSHALL, Georgia PETER J. ROSKAM, Illinois
DAN BOREN, Oklahoma KENNY MARCHANT, Texas
C O N T E N T S
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Page
Hearing held on:
March 20, 2007............................................... 1
Appendix:
March 20, 2007............................................... 43
WITNESSES
Tuesday, March 20, 2007
Bacon, Kenneth H., President, Refugees International............. 24
Brownback, Hon. Sam, a U.S. Senator from the State of Kansas..... 8
Ismail, Omer, Fellow, Kennedy School of Government at Harvard's
Carr Center for Human Rights Policy............................ 19
Lee, Hon. Barbara, a Representative in Congress from the State of
California..................................................... 2
Morrison, J. Stephen, Director, Africa Program, Center for
Strategic & International Studies.............................. 28
Payne, Hon. Donald M., a Representative in Congress from the
State of New Jersey............................................ 6
Prendergast, John, Senior Advisor, International Crisis Group.... 21
Sterling, Adam, Director, Sudan Divestment Task Force............ 26
Williams, Michael L., Commissioner, Railroad Commission of Texas. 22
Wolf, Hon. Frank, a Representative in Congress from the State of
Virginia....................................................... 5
APPENDIX
Prepared statements:
Bacon, Kenneth H............................................. 44
Ismail, Omer................................................. 48
Morrison, J. Stephen......................................... 53
Prendergast, John............................................ 59
Sterling, Adam............................................... 64
Williams, Michael L.......................................... 68
Additional Material Submitted for the Record
Sherman, Hon. Brad:
Statement of the Armenian Assembly of America................ 79
H.R. 180, THE DARFUR ACCOUNTABILITY
AND DIVESTMENT ACT OF 2007
----------
Tuesday, March 20, 2007
U.S. House of Representatives,
Subcommittee on Domestic and
International Monetary Policy,
Trade, and Technology,
Committee on Financial Services,
Washington, D.C.
The subcommittee met, pursuant to notice, at 1:05 p.m., in
room 2128, Rayburn House Office Building, Hon. Luis Gutierrez
[chairman of the subcommittee] presiding.
Present: Representatives Gutierrez, Maloney, Sherman,
Meeks, Moore of Kansas, Clay; Paul, Castle, and Roskam.
Chairman Gutierrez. Good afternoon. The Subcommittee on
Domestic and International Monetary Policy, Trade, and
Technology of the Committee on Financial Services will come to
order.
Today's hearing is a legislative hearing on H.R. 180, the
Darfur Accountability and Divestment Act of 2007, introduced by
Representative Barbara Lee. In this hearing, the subcommittee
will closely examine divestment strategies for the region and
hopefully help this committee and the House in to determine the
best way forward.
With violence and atrocities in Darfur getting worse on a
daily basis, it is important that we explore all of the
available options we have at our disposal to put a stop to the
barbaric slaughter of innocent men, women, and children. In my
opinion, H.R. 180 should be an integral part of our overall
strategy to put an end to genocide in Darfur, and I commend
Congresswoman Lee for her efforts on this legislation.
Before I go to our first panel, I ask unanimous consent
that all members of the Committee on Financial Services who are
not members of this subcommittee be permitted to participate in
today's subcommittee hearing. Per committee rules, we have
agreed to limit opening statements to 10 minutes per side, but
without objection, all members may submit written statements.
I am going to introduce the members of our first panel
first, and then we will go back to opening statements, if there
is no objection.
Hearing no objection, that's what we will do.
We could not ask for a more distinguished panel on this
issue than our first panel today. Joining us we have
Congresswoman Barbara Lee, a relentless advocate on Darfur
issues, and the author of the Darfur Accountability and
Divestment Act of 2007. Thank you, Congresswoman Lee, for all
of your work on this issue.
We are also joined by Congressman Frank Wolf, a tireless
and widely respected advocate for human rights around the
globe. He is a senior member of the House Appropriations
Committee, where he serves as ranking member of the State
Foreign Operations Subcommittee, which has oversight of the
State Department and other international programs and
organizations including the Peace Corps.
Congressman Wolf is also co-chairman of the Congressional
Human Rights Caucus, a bipartisan organization of over 200
House Members that identifies and works to alleviate human
rights abuses worldwide. I welcome you both, and I recognize
Congresswoman Lee for her testimony.
STATEMENT OF THE HONORABLE BARBARA LEE, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Ms. Lee. Thank you very much, Mr. Chairman, and let me
thank you and the ranking member and Chairman Frank for holding
this very important hearing today, and also for your
leadership.
As a former member of this very subcommittee, it is truly
an honor to come before you today to testify on my bill, H.R.
180, the Darfur Accountability and Divestment Act, better known
as DADA.
I also want to thank Congressman Wolf for his steadfast
leadership, and for helping to make sure that the world knows
that--here, at least, in the House of Representatives--this is
a bipartisan issue. Genocide knows no party line, and we have
worked together on many, many issues relating to Darfur and
genocide. So thank you, Congressman Wolf, and I would also like
to thank all of the panelists who will be here shortly.
Twelve years ago, Mr. Chairman, the world stood by as
nearly one million people were slaughtered in the genocide in
Rwanda. The best our country could do then was, after the fact,
to apologize for our failure to act. Many of us swore that
another Rwanda would never happen again on our watch. But
today, Mr. Chairman, it is happening again.
Nearly 3 years ago, on July 22, 2004, Congress formally
declared that the ongoing atrocities in Darfur constituted
genocide. Again, this was a bipartisan initiative. Congressman
Payne led the way with many Republicans, and we were able to
finally do this monumental pronouncement, which--it still,
unfortunately, is a genocide that we are witnessing.
Since the start of the conflict, it is estimated that
nearly 450,000 people have been killed, and 2.5 million
innocent civilians have been displaced. I witnessed this
ongoing tragedy firsthand in January of 2005, when I visited
the refugee camps in Chad, and went into Darfur with two great
humanitarian leaders, Don Cheadle, the brilliant Academy Award
nominee, star of Hotel Rwanda, and Paul Rusesabagina, whose
courage in Rwanda saved many lives. That delegation was led by
Chairman Ed Royce of California. It was a bipartisan
delegation. And, again, we all witnessed the horrific acts of
genocide, and the results of those acts of genocide in the
camps.
In February of 2006, under the very bold leadership of
House Speaker Nancy Pelosi, I visited the refugee camps again
in another region of Darfur, and we saw all of the suffering
around us. It had not gotten any better. We heard from people
who had witnessed, and fled from, the ongoing genocide.
I can remember going into one of the camps where children
had drawn pictures of airplanes bombing the refugee camps, of
men on horseback with machetes and rifles, and of village huts
blowing up in smoke, and in flames. And these kids, of course,
were traumatized. The men and women were also traumatized by
what they had seen. And I was convinced, then, that these
children did not lie. They told the truth. The Khartoum
government was coordinating, with the Janjaweed, to conduct the
rape and the slaughter that was taking place in these camps.
Although a tentative peace agreement was signed in May of
last year, it was not accepted by all parties. Rather than
following through on this obligation, the Khartoum government
has remained defiant--quite defiant--to this day. Meanwhile,
the killings continue, the rapes, the starvation, the
dislocation, they all continue.
The genocide is real, and it is happening on our watch. The
credibility of the United States is on the line. We have to be
about action, not just talk. We must use all of the tools that
we have available to end this genocide. And I believe, at this
point, that we have to hit Khartoum where it hurts, and that's
in their pocketbooks.
As many of you know, divestment was a successful tool in
ending apartheid in South Africa. It put our country on the
right side of history when we finally, after many, many years,
imposed sanctions on the apartheid regime in South Africa. My
predecessor, Congressman Dellums, led that fight, and I believe
the bill was introduced for at least 12 years before the
Congress overrode President Reagan's veto in the early 1980's.
Today, State legislatures, colleges, and universities are
all leading targeted divestment campaigns against companies
doing business with the Khartoum regime. State legislatures in
California, Vermont, Oregon, New Jersey, Maine, Connecticut,
and of course, your State, Illinois--which I believe was the
first State, or Mr. Payne's State, great competition there; we
were a little slow, but California did come, finally--we have
all passed legislation mandating divestment of State funds from
companies that conduct business in Sudan. And many more States
are starting to follow in their lead.
Divestment campaigns are ongoing in over 17 other States.
Additionally, students, young people, such as Students Taking
Action Now: Darfur, better known as STAND, are driving their
respective colleges and universities to divest from companies
doing business with investments in the Sudan from Harvard
University and Yale, to the University of California, my alma
mater, and Stanford University, and many schools have all
divested their funds from--or placed restrictions on
investments of their funds in--certain companies that conduct
business in the Sudan.
In April 2006, the House passed H.R. 3127, the Darfur Peace
and Accountability Act, by a near unanimous vote of 416 to 3.
And I have to commend Congressman Payne for working so
diligently and effectively, in a bipartisan way, to make sure
that this did pass and become the law of the land.
Among a number of important provisions, the House went on
record in support of specific language that I added in section
11 of the bill, which empowered States to enact divestment
legislation targeted at the Sudan, without fear of being pre-
empted by Federal laws.
Unfortunately, Mr. Chairman, a single Senator in the other
body objected specifically to this language, and in the
interest of passing the larger bill, we compromised and pulled
it out. Now there are signs that the divestment movement at the
States may be in trouble, and may need our help. And so, this
bill, the DADA bill, seeks to rectify this problem by including
language that protects State divestment efforts from being pre-
empted by Federal law.
My bill takes the divestment movement to the next logical
step, and that is, of course, the Federal Government. This bill
requires the Securities and Exchange Commission to take steps
to identify companies listing securities on the U.S. capital
markets that are also doing business in the Sudan, and to
require these companies to declare the nature of their business
operations.
If these companies are propping up the Khartoum government
in any way, or if they are engaging in the sale of military
equipment or dual-use technology, like radar systems, then my
bill would prohibit the Federal Government from entering into
new contracts or renewing any existing contracts with those
companies.
Already, just the introduction of my bill alone has
convinced two companies, Siemens AG and ABB, to suspend their
business operations in the Sudan because of this contracting
requirement, which is a positive step in the right direction.
Let me be very clear, though. Companies that do not support
the government of Sudan or the government-backed militias, or
that are working for peace and security, or providing
humanitarian assistance in Darfur, will be exempted from this
requirement. We want to get at those who are the worst
offenders in the Sudan--by and large, those companies that are
engaged in, of course, the petrochemical and natural resource
extraction industries, and who rely on government complicity to
allow them to operate.
My bill would also charge the Government Accountability
Office with investigating the investments made by the Federal
Retirement Thrift Investment Board, which manages a pension
plan for 3.6 million people with over $186 billion in assets. I
don't believe the American people, especially Federal
employees, want their blood on the hands of those who are
getting killed in Darfur.
Think about the potential impact that $186 billion could
have on the marketplace. That would be a huge accomplishment,
and would guarantee to all of our Federal Government employees
that their savings and their pension funds will not be used to
fund genocide. We have a moral obligation to do everything in
our priority in the genocide in Darfur, and we have a fiduciary
responsibility, also.
And this is not a partisan issue. Currently, we have over
80 co-sponsors on the DADA bill, and I am willing to work with
the committee, Mr. Chairman, and members on both sides of the
aisle, to move this legislation forward. I am open to--
Chairman Gutierrez. Thank you.
Ms. Lee.--any suggestions to strengthen it. The bottom line
is that we must keep up the pressure on the Khartoum government
in any way we can. We must insist on real political settlement,
a peace agreement that goes far beyond the May 6th agreement,
and we must ensure that Darfurians can return home to their
villages and reclaim their lives. We must bring the
perpetrators of the state-sponsored genocide to justice.
Thank you, Mr. Chairman. I look forward to answering any
questions.
Chairman Gutierrez. Thank you. And now we have our
distinguished and dear friend, Congressman Frank Wolf.
STATEMENT OF THE HONORABLE FRANK WOLF, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF VIRGINIA
Mr. Wolf. Thank you, Mr. Chairman. I also want to thank
Congresswoman Lee and Congressman Payne for their efforts on
this.
I have been to the Sudan five times. Sam Brownback and I
led the first group that went in there, back in the summer of
2004. I think everything that Congresswoman Lee said--there is
not much more that you can say.
These people have been living in camps, sometimes for
almost 4 years, on 900 or 1,000 calories a day, with no
medicine, and human feces and animal feces all over the place.
And this institution that we're all honored to be part of has
talked a lot about this.
But, really, fundamentally--and I can get into it on
everything from the helicopters coming in, the bombers bombing,
the Janjaweed outside, coming in and shouting and hollering,
and they hang around the camps all morning, early in the
morning. When the women go out to the camps, they rape the
women. And the U.N. has done fundamentally nothing. China has
blocked the security council, so I'm not even going to read my
statement.
What she says is true. It's the only thing that made the
difference with regard to South Africa. You ought to report
this bill out, get it on the Floor, bring it up under
suspension, and anyone prepared to vote no, let them vote no,
and get it over to the Senate. But we have really done a lot of
talk.
It was 3 years ago that Congress called it genocide,
Secretary Powell called it genocide, President Bush called it
genocide. And in reality, life is no better, and in some
respects even worse, because if you've been in a camp for 3- to
3\1/2\ years, your system is down, your children haven't had
any education, and you have had death and everything else.
So, I think the sanction issue is the only issue. The
diplomatic efforts have pretty much failed. President Bush has
appointed Andrew Natsios, and Andrew is doing a good job,
working his heart out trying, but overall, diplomacy has
failed. And other than Barbara Lee's idea, there is nothing
facing this Congress that will really bring this thing to a
conclusion.
So, I will submit my statement, and I support the passage
of the bill quickly, because again, it's been going on now for
4 years.
Chairman Gutierrez. Thank you so much, Congressman Wolf.
Congressman Donald Payne is a recognized expert on African
issues, and a distinguished member of the House Committee on
Foreign Affairs, where he is now chairman of the Subcommittee
on Africa and Global Health. Mr. Payne was a driving force
behind the passage of a resolution declaring genocide in
Darfur, and we ask him to please give us his statement. We are
so happy to have him here this afternoon.
STATEMENT OF THE HONORABLE DONALD M. PAYNE, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Payne. Thank you, Mr. Chairman and Ranking Member Paul.
It's a pleasure to be here before your subcommittee, and I
appreciate the opportunity to have some comments on this very
timely and very important issue of the divestment of public
funds from entities doing business with Sudan.
Let me begin by commending Representative Lee for this
legislation. She was a very valued member of the Africa
subcommittee until her ascension, I guess, to the
Appropriations Committee, and we do appreciate the work that
she continues to do.
Of course, there is no greater champion on Sudan than
Congressman Wolf. He has been fighting the battle of Sudan
since before I even came to Congress. He worked on the north/
south situation, where for 21 years, it was a civil war where 2
million people died, and 4 million people were displaced, but
Congressman Wolf was there the entire time, pushing for what
finally became the comprehensive peace agreement. There is no
person who has done more over the period of time than he has.
And he has current legislation that will have an institute
on agriculture named after the late Dr. John Garang, who
actually fought for 21 years to have Sudan recognize the rights
of the people of the south, fought for 21 years, and was killed
in a helicopter crash, mysteriously, 21 days after the
agreement was signed, and the new government went into effect.
So, we have a lot of tragedy in the story of Sudan, but we
have to continue. in 2004, I, along with others, introduced a
resolution calling the violence in Darfur by its rightful name,
genocide. And calling on the international community to take
action to stop it, Congresswoman Barbara Lee must certainly be
commended for her work on divestment. Her bill, the Darfur
Accountability and Divestment Act of 2007, is critical to the
fight to end genocide in Darfur.
Included in the bill is language which would protect States
who divest from legal action. State senator Jackie Collins
championed divestment legislation in Illinois, which has been
mentioned. However, the National Foreign Trade Council, a
Chicago-based group, Mr. Chairman, filed suit against the State
of Illinois, and actually won their case earlier this month.
Many States would face the same fate, without the lead bill.
I believe that there are a number of things the Bush
Administration can and should do to end genocide, including
enforcing, along with our allies, a no-fly zone over Darfur,
which I have asked for in a bill that had several hundred
sponsors. But then, former-Chairman Hyde had my bill tabled,
and a new bill came out that took out the no-fly zone. I think
if that legislation would have been able to go through, we
would have seen different results in Sudan now. But that's the
past, and we have to move forward.
We need to continue to push sending U.N. and NATO troops to
help the Africa union. Just yesterday, Bashir said he wants to
renegotiate the agreement in which he first said that U.N.
troops could come in. He said then that it had to be a hybrid
force, and now he is saying we have to renegotiate, and maybe
there will be no force at all.
And so, we need to continue to push the United Nations to
impose international sanctions on leaders of the National
Congress Party. I shared these points with President Bush last
month, when the Congressional Black Caucus met with him, and he
indicated a strong interest in trying to move forward on these
issues.
At the same time that we pursue military and diplomatic
options to address the crisis in Darfur, we should apply
economic pressure on the regime in Khartoum. In 2005, as Ms.
Lee mentioned, New Jersey became the first State in the union
to introduce legislation, actually offered by my brother, State
assemblyman William Payne, which requires New Jersey companies
with an equity tie in Sudan to redeem, sell, divest, or
withdraw their investments.
New Jersey was really the second State to enact the
legislation, but our legislation said in 3 months. And all
money, pension funds in New Jersey, and companies doing
business with Sudan--17 foreign corporations, $2.16 billion--
have been identified, and equity ties have been severed
completely in 3 months--90 days. So it can happen.
Six other States have enacted similar legislation, and
there are campaigns in 20 more States to do this. Why? Because
history has shown that economic pressure helps change policies.
You should know that in 1985, New Jersey was the first State in
the union to divest from South Africa, divesting over $4
billion in State pension funds from private companies. And as
Congressman Wolf mentioned, that really hit where it hurt, in
South Africa.
This proved to be a watershed event, as States and
universities across the United States also divested. The
action, in conjunction with the Congress's--Ron Dellum's
Comprehensive Anti-Apartheid Act, the CAAA was widely credited
with helping to bring an end to apartheid in South Africa--not
only did economic pressure bring change in South Africa, it has
caused the Sudanese government to change its behavior.
In 1997, when President Clinton enacted sanctions by
executive order due to Sudan's complicity with terrorists, the
Sudanese actually took action, shutting down terrorist camps.
We are told that the government continues to cooperate with the
U.S. counterterrorist effort, though I fear that the
counterterrorist assistance is inflated, and our government has
grown too close to Khartoum. I think they're telling us what
they want to tell us to make us feel they are really
cooperating, but I doubt very seriously if that government can
tell the truth on anything.
I should mention that the president--that President Omar
al-Bashir and the National Congress Party in Khartoum, Sudan,
which was formerly known as the National Islamic Front, came to
power in a military coup in 1989, and from 1991 to 1996, this
regime gave safe haven to Osama bin Laden. So these are some
very horrible people we're dealing with, as I conclude, since
our Senator is here.
In addition to what I have stated about divestment, the
divestment campaign has helped discourage international
companies from investing in Sudan. As Ms. Lee said, I
understand that Siemens, a well-known German company, decided
to halt its operations in Sudan, and others are questioning
going in.
One factor that led to the decision was the effort that
doing business in a country against which there is an active
divestment campaign had a reputation that was a stain on the
company. And so, less investments mean less revenue for the
National Congress Party. Less revenue means fewer resources
from which they can buy weapons for their military and the
murderous Janjaweed militia.
On the issue of weapons, China is a major supplier of
weapons to the regime in Khartoum, and the largest oil
developer in Sudan. The Congressional Black Caucus has met with
the Chinese ambassador, and we will meet with him again after
the break to, once again, insist that China stop their holding
up of actions in Sudan.
As I conclude, Mr. Chairman, Congress cannot do less in the
face of genocide than State governments have done. We must take
similar action, and soon. It has been 4 years and 400,000
deaths since the tragedy in Darfur began. It is long past time
that decisive action is taken. While we all recognize that
divestment will not resolve the conflict by itself, it is
important that we keep the pressure on.
I am expecting a call in an hour from Sol Vikir, who is
working with, now, the rebel groups, because they have no
single leader, and he is trying to bring them together, so that
they can negotiate as a unit. That's another issue that we have
to get moving. But with that, I appreciate the opportunity, and
I yield back. Thank you.
Chairman Gutierrez. Thank you very much. Quickly, to
Congressman Wolf, this issue of priority--and I know I speak
for the chairman of the full committee--we will act on this
quickly. I assure you, your comment to us, and your
encouragement, was well taken.
I would like to now introduce a colleague from the other
body--I don't know why we can't say ``the Senate,'' but anyway,
Senator Sam Brownback.
Senator Brownback, also a long-time advocate on this issue,
has recently called on State pensions to divest in Darfur, and
as a co-sponsor of the Darfur divestment legislation, Senate
831, the Sudan Divestment Authorization Act of 2007, a bill
introduced by Senator Durbin, that would authorize States and
local governments to prohibit investment of a State's assets in
any company that has a business relationship with Sudan.
And with that, we are happy to have you, Senator. Thank you
so much. Please.
STATEMENT OF THE HONORABLE SAM BROWNBACK, A UNITED STATES
SENATOR FROM THE STATE OF KANSAS
Senator Brownback. Thank you, Chairman Gutierrez, it is
good to see you. Both Congressmen Wolf and Payne and I have
traveled together to the Sudan, and these are the lead
individuals who know this topic better than anybody else, and I
think probably are more frustrated than anybody else in the
entire Congress, and possibly the entire country, about how
long this has gone on.
And this is the second genocide; it's not the first one. We
didn't call it that in the south, but there were two million
people killed by the same murderous government that is in
Khartoum, that is doing this now in the west, in Darfur.
So, this just keeps going on. And the frustration level
keeps building, and the inaction continues. And now you see
that the government in Khartoum is saying, ``Well, we're not
going to allow U.N. troops in this time. We said we would, we
said we would work with people, and now we're not going to do
it.''
I think this is a simple proposition, this particular bill
on divestment, that says, as one of the other people said--and
perhaps it has already been quoted--``Not on our watch, not on
our dime.'' We are not going to continue to fund this
government in its second genocide off of money and resources
from the United States, period. And we should move these
forward aggressively.
And the States--and I applaud New Jersey for leading in
this area. My State is--now the State senate has voted to
divest, and the house is considering it. We need to make sure
it's clear that they can do this. I think these are bills
intended to clear up any sort of questionable category, if
there really is. I don't know that there particularly is, but
this is something we need to clear up, and we need to make a
clear statement on it.
And if we can get a wave of States doing this, and then
encourage private individuals to do the same with the
statements that the States are doing, individuals to look at
their own resources and see if they are investing in any
companies that are doing business in Sudan. And if this
government continues to desire to have a genocide conducted,
it's not going to be with our money, period. I think we have to
be very clear and very strong about that.
I don't think that, in and of itself, is sufficient. I met
with my colleague from Illinois last week, twice. Senator
Durbin, who--he and I have traveled to Africa, not to the
Sudan--but to talk about what else could we put together of
action items for as far as supporting of peace-keeping troops,
as far as reviewing other possible options of no-fly zones, and
looking at other sanctions that we can do of individuals
traveling in and out of Sudan, or key individuals.
And I would hope that we could start pulling together a
list of these items that we could do together, like Congressmen
Payne and Wolf, in particular, in the past have been very
successful at getting us pulled together around a series of
items that we can and should do, and then let's start hitting
it.
Every minute we waste, somebody else gets killed. More
people die, and more people are left in the carnage that has
been caused by this government. We're not powerless. There are
things we can do, even if the Khartoum government doesn't agree
with the troops being there, there are things we can do.
And I just--I hope we find the will and the gumption and
the time, because that's generally what it is, more than
anything, is us just finding the time to get together to figure
out what it is we want to do. Because once we do, we can move
it, and it can happen. And I just--I pledge my own effort and
time to do that, because each minute is somebody else getting
killed in a place, a region in the world where it shouldn't
happen, and it shouldn't happen on our watch, and it shouldn't
happen on our dime. Thank you, Mr. Chairman.
Chairman Gutierrez. Thank you, very much. I will yield
myself 5 minutes for questions of the panel, but I will yield
the first minute to my friend, Congressman Moore.
Mr. Moore of Kansas. Thank you, Mr. Chairman, and thank you
to the four witnesses who are testifying today. I think the
American people would be proud to see this, to see two
Republicans and two Democrats sitting at this table, all in
agreement about what's happening, as far as genocide, and
people being killed in Darfur. And I am very proud of all four
of you.
I say to the senior Senator from Kansas, we have many
political differences, but I have told him before that I am
very proud of the position he has taken on human rights
violations, and he has been a consistent supporter of trying to
stop human rights violations, and especially genocide, in
places around the world.
And the same to Congressman Wolf, to Congresswoman Lee, and
to Congressman Payne. Thank you very, very much for what you
are doing here, and I want to support you.
Chairman Gutierrez. Thank you. Let me, first of all, say to
the four of you how proud I am to be a member of this
institution, being able to see the four of you, the diversity,
you know, East Coast, West Coast, middle of the country, and to
see all of you come together on this issue of Darfur.
I think I echo the comments of my friend from Kansas--and I
say that sincerely--Congressman Moore, to see the four of you
working together, I just know we can get this done.
I have a question for Representative Barbara Lee. You know,
it's fairly widely acknowledged that divestment and economic
sanctions generally do not work, as they are many times
intended. Our embargo against Cuba and sanctions against Burma
are two examples that come to mind. We can point to success
against white rule in South Africa in the 1980's, but even in
that instance, one byproduct was greater hardship for black
South Africans.
Why is this situation different? Why do you believe that
divestment will work in Darfur, Congresswoman Lee?
Ms. Lee. Sure. First, thank you very much, again, for this
hearing, Mr. Chairman. And I think divestment will work. It has
worked. You cited examples where it hasn't worked, but it has
worked throughout the world, really.
When it came to South Africa, I think that is probably the
best example of how it did work, and it's very similar to the
strategies that we are mounting here. The first States--I
believe California was the State to divest of its pension fund
holdings in South Africa--then States followed the California
model. Subsequent to that, the United States Congress imposed
sanctions against South Africa, and this was a long-term
process, but it did work.
With regard to Sudan, first of all, there are many foreign-
owned companies that are heavily invested because of the
petrochemical and resource extraction industries in the Sudan,
and many of these companies are considered the worst offenders.
We want to find out, first of all, we want to know who they
are. I mean, I think--and what we have seen already, with two
companies, just with the bill being introduced, Siemens and ABB
having said, ``No more,'' they know that this is going to
happen.
I think genocide is taking place, which again, is a big
difference, in terms of other divestment efforts. We have
450,000 people who have been killed, and we have major
companies that need to be--we need them listed, and the SEC is
responsible for listing these companies.
And so, the first step under this bill is just to know who
these companies are, first of all, and then, to make sure that
they are not afforded Federal contracting opportunities. I
think those two factors: one, that genocide is taking place,
450,000 people have been killed; and two, that there are
companies that are in these two industries that need to be
squeezed, because the Khartoum government is relying on these
investments, because of their industrial base. And I think that
this is a strategy that will work.
Chairman Gutierrez. Thank you. Let me just end with saying
this. I have been a Member here for 14 years, this is my 15th
year, and I have to say that I will never see Congressman Frank
Wolf or Senator Brownback in the same way, after listening and
learning a lot more and preparing for this hearing, about what
you have done.
That may be a shame of me, and a shame on our lack of
relationship, but I just thought I should share that with you.
So, if anything else, I think these hearings--like-minded
people come together on the situations they might not
otherwise. Yes, Congressman Payne?
Mr. Payne. Yes, just on the point, as Congresswoman Lee
mentioned, you know, you need a number of tools when you come
to a complicated situation like we have in Sudan, and no one
tool is really going to work. That's why divestment--and it
did, it wasn't divestment alone, it was then the boycotts and
the isolation from the Olympics--in South Africa--it was a
number of issues, and then it started an internal debate with
South Africans. They were an island unto themselves. They
couldn't participate in international organizations, still,
with the divestment going on.
You know what investment does. Taiwan, Korea--people
invested in them, and they became strong and robust. So,
therefore, the whole question of investment and divestment
definitely has its place. If we can hold back investment to
slow down and retard the economic growth and development, I
think that it's very good.
The question about the poor people suffering, in South
Africa we asked South Africans, just like we have asked
Sudanese, and they said they're suffering anyway, they're dying
anyway. And so, to have a little more pain that indirectly
falls on them, they're willing to suffer a little more, because
if it means regime change, or weakening their government up in
their capitals, whichever country it was, they support that.
And so--
Chairman Gutierrez. Thank you.
Mr. Payne. That's what I would like to say.
Chairman Gutierrez. I would now like to recognize my acting
ranking member, and my good friend, Mr. Castle, Congressman
Castle, please, for questions.
Mr. Castle. Well, thank you, Mr. Chairman. Let me--I am
also impressed by the knowledge that the four of you have about
this, and I think it's very helpful to know that there are
Members of Congress who have taken this kind of interest. I
think all four of you deserve tremendous credit for dealing
with a very difficult problem.
I would like, Congressman Wolf, to ask you this. You
indicated that the U.N. has done nothing, and I think back on
Iraq, when the U.N. didn't do much, and various other
circumstances. I was wondering if you could expand on that, in
terms of if--and I'm assuming your statement is correct, and we
are all generally familiar with the problems of Sudan.
But if they have done nothing, why have they done nothing?
Is it a lack of will, or a lack of enforcement mechanism? And
then you went on to say that diplomacy has failed, as well, and
you might comment on that, as well. Based on what's happening
there, I assume these statements are absolutely correct. But I
am wondering why, when it was such an obvious problem,
something hasn't happened before now.
Mr. Wolf. The powerful really just don't hear the
powerless, at times. The very reality is when--if you read
Samantha Power's book, ``A Problem from Hell,'' it's an--and I
will have my office call your office to give you the title, and
make sure I have it right--you will see that the U.N. stood by.
And Kofi Annan was head of peacekeeping when the Serbs were
standing there, and the Muslims were marched out, and they did
nothing. And the fact is, the U.N. forces actually pulled back.
In Rwanda, the cables were coming back and forth to the
State Department, and also the U.N., with regard to the
genocide taking place. In Rwanda, the U.N. peacekeeper wanted
to do something and was told to back off. And as a result of
that, we lost 700,000 to 800,000 people.
In Sudan, the U.N. pretty much stood by when the north/
south--as Senator Brownback said, this is the second genocide.
There were 2.1 million--mainly Christians, but a large number
of Muslims--who were killed in a north/south war. And as
Congressman Payne said, bin Laden lived in Sudan from 1991 to
1996. And like the old Simon and Garfunkel song, ``The
Boxer,'': ``The man hears what he wants to hear, and disregards
the rest.''
The way the U.N. is set up, the Chinese have an absolute
veto. When you go to Khartoum, the largest embassy in Khartoum
is the Chinese embassy. There are Chinese government officials
all over the place. They're getting roughly 6 percent of their
oil coming out of Khartoum. They are using that money to buy
the Soviet helicopters, the bombers.
So, the U.N. has been just locked up, if you will. When
Senator Brownback and I were there, the first call we made when
we got back was to ask Kofi Annan to go. He then went, went
back again, but still, the security council is set up in such a
way that no one wants to take on the Chinese government.
And, quite frankly, this Congress has not been particularly
courageous in taking on the Chinese government. The violation
of human rights in China is unbelievable. I mean, it is
beyond--conditions are worse today in China than they were when
they got MFN, and yet the world just doesn't want to go against
them.
So, the U.N. is tied up in that way. Security council has a
veto. For a long period of time, the Russians weren't
cooperating. Now they are beginning to participate.
But read Samantha Power's book, ``A Problem from Hell.''
This genocide, and types of activities like this, have gone on
for a long, long period of time--and ethnic cleansing--until it
kind of reaches a consensus. And we have a museum down on the
mall that says, ``Never again,'' and yet during that period of
time, it has taken place over and over and over. And when Sudan
and other governments see that nothing really happens to the
people, it emboldens others to do it. But I will call your
office, Mike, and make sure that you get a copy of the book.
Well, I was going to ask something else, but that leads me
to another question, and that is the relationship of China and
Sudan. I understand that China is one of their biggest
customers, one of their biggest economic factors. What is our
relationship, in terms of dealing with China, vis a vis Sudan?
Are we engaged in that, ourselves?
Mr. Wolf. Andrew Natsios has spoken to the Chinese. If you
recall, President Hu--and maybe Don will have the exact date--
was in Sudan about a month or a month-and-a-half ago, and
announced--the big announcement was not that they were going to
deal with the issue of genocide, but that they were going to
build him a new palace. You remember that?
Mr. Payne. Yes.
Mr. Wolf. That China is building Bashir a new palace.
Parade Magazine did a piece a month ago, saying the number one
dictator in the world is President Bashir, and China's activity
was that they're going to build him a palace. So they just
really haven't really done very much. They get a lot of oil
from them.
Mr. Castle. Congresswoman Lee?
Ms. Lee. Thank you very much for that question, because I
think that is a very key question, and a key policy perspective
we have to have, in terms of our foreign policy. I always
remind my colleagues and others that we did grant most favored
nation status, and there are many trade preferences that we
provide, and there are many economic preferences and
relationships we have with China. I believe we need to call in
a chit, and I don't know why the Administration doesn't use its
leverage to call in this chit, when 450,000 people have been
killed.
I think we need to up the ante on the Administration, as
well as the Chinese government, because the United States
should be, given what we have done with regard to China, we
should be in the driver's seat.
Senator Brownback. If I could just respond, part of this
divestment--not a part of it--a big part of this divestment
effort is aimed right at the Chinese. Because this is the
leverage point, this is the--the investment is being done
primarily by Chinese companies, not exclusively, but primarily
by Chinese companies, and sometimes, or a lot of the time, with
Western resources.
That's where the pressure point is, and that's what we need
to hit, and the Chinese have no hesitancy whatsoever--indeed,
it seems as if part of their business model is to associate
increasingly with somewhat rogue regimes, where perhaps you can
get better business arrangements, because the rest of the world
won't deal with them.
I think we should make them pay a price for their business
plan model. This is part of it, and it's something we need to
do soon. We need to do it now.
Mr. Payne. And they are absolutely right. You know,
Talisman Oil Company, from Canada, was a part of the oil
movement in Sudan. We started divesting from our State
pensions--once again, in New Jersey, we do this sort of thing--
so we pulled pension funds out of Talisman, sent the word up to
Talisman that we were going to get this moving. Talisman sold.
They said, ``We're out of here.'' Of course there was someone
to buy it.
But that is a clear example of how pressure really works.
And as Ms. Lee said, you know, we had this MFNS, the most
favored nation status, which sounded too nice, because we knew
China was evil, so they changed the name to PTR, I mean, what
is it, permanent trade relations. That doesn't sound so nice,
you know. And we have a way of doing that with words, you know.
But we have this relationship with China. The militaries
are getting too strong, they send up satellites. But our big
corporate entities can't get to China fast enough. They're
waiting for that 380, I guess, that holds 500 people, so they
could put all the businessmen on the rush to China to get the
good deal. On the other hand, China is fueling the worst
dictators in the world.
And so, another instance of how this country needs to come
up with a policy. Where do we stand? Do we love them or hate
them? Is it Defense that hates them and the business that loves
them? I mean, we can't have a national position on China. So
they are on the security council, they have threatened any time
a strong resolution would come up, they say, ``We're going to
veto it. So, water it down, and we may let it go through.''
That's what has been happening in the security council, those
five permanent members.
Chairman Gutierrez. Thank you, Mr. Castle. I want to go
quickly to Congressman Roskam, a freshman member from Illinois,
for questions, please.
Mr. Roskam. Thank you, Mr. Chairman. The--I was pleased to
hear State senator, Jackie Collins, mentioned, from Illinois,
who really led the charge in the Illinois general assembly, and
I was pleased, when I served with her, to co-sponsor that
measure.
Just a question to all of you, who have a lot more depth
and background on this--anybody who can just answer a couple of
questions. How is this distinguished from the South African
effort? It seems to me that this bill does two things: number
one, it requires disclosure to the Securities and Exchange
Commission for those publicly-traded companies that are doing
work; and number two, it says that the U.S. Government is not
going to contract with any of those companies.
Is that all we did in South Africa? Or was the South
African sanction actually a broader sanction, which was an
actual prohibition against other companies from doing business
in South Africa? Do you understand my question?
In other words, is this incremental? Is this a baby step?
Sort of junior varsity sanctions, to put it that way? Or is
this as good as it gets?
Mr. Payne. In my opinion, this is as good as it gets. It
deals with what we have authority over. As you know, because of
the 1997 sanctions, U.S. companies can't do business with
Sudan, anyway.
Mr. Roskam. Okay, that's the piece that I am missing.
Mr. Payne. Yes, so--
Mr. Roskam. Can you just explain that a little more in
detail to me?
Mr. Payne. Well, during the Clinton Administration, there
was a strike, you recall, on the drug factory. And because
Sudan was violating laws, the Executive Branch put sanctions on
the government of Sudan. So, that is why there are no U.S.
companies in Sudan. Don't you know they would be running around
there, too, if it wasn't for our sanctions.
Now, the--so the United States had sanctions on U.S.
companies. Also, Charlie Rangel had legislation, a double
taxation, that anybody who was in South Africa had to pay
double taxes. It was a quiet thing that was there, in addition
to the Comprehensive Anti-Apartheid Act, which was another
thing, so it was a combination of different sanction bills.
But this is, I believe--and I'm not, you know, a financial
guy--but I think this is about as much as we can do, saying
that our public pension monies cannot be invested in any of
those companies doing business in Sudan. U.S. companies are
restricted anyway, so--and one other thing that we have done.
I have been working on language which I am going to
introduce, because we have to figure out different ways that
would block oil tankers who dock at the port of Sudan from
entering U.S. ports. That's where they come.
So, I would like to talk to you about some--yes, language
where--it was in our--it was in 1434 last time, last session,
which didn't go through. But this would primarily hurt China,
because of course, they're off-loading the oil in Sudan, and
coming into U.S. ports.
So, if we continue to get the word out--I mean, people
never thought about diamonds until blood diamonds, and that
whole question about Kimberley Process, and now people are
saying, ``Well, we want to make sure that these diamonds are
real.'' So, believe me, to bring attention, economic pressure
is about the only thing we could do.
I would like to see a force go in, you know, but that is--
no one is going to do that.
Mr. Roskam. Anybody else, in terms of an observation on
that? Yes, ma'am.
Ms. Lee. Yes. Let me say--I was very involved, as a
student, in the anti-apartheid movement, and an additional
measure in California that we mounted was prohibiting the
unloading of cargo through our ports from South Africa. I'm not
sure if that became a national effort, but that certainly
occurred in California.
Also, with regard to the preemption provision of this
legislation--and I will get back to you with regard to how--
what the law was at that point--because now, what we're finding
is there are lawsuits being--and, you know, that are
challenging the States in their divestment efforts. I don't
recall those challenges during the anti-apartheid movement. But
we decided in this bill that we would definitely put a
provision in that would allow States to do what they need to
do.
Finally, Mr. Chairman, let me just say with regard to the
bill, I wanted to make this general statement. I think I said
earlier, this is going after the bad actors, the companies that
are perpetrating genocide, or using their investments, which
allow the Khartoum government to perpetrate genocide in the
Sudan.
We have a section of the bill on pages 10 and 11 that does
allow for some exceptions, and that is for those companies that
are not doing this, but also those companies that are working
to implement the Darfur peace and accountability--Darfur peace
agreement in May of 2006. Also, those companies that are
providing humanitarian assistance, that are working with the
people in the south.
And so, this is a bill that is very narrowly crafted to go
after the bad actors, the most egregious companies that are
allowing, either by design or not, or through their
investments, you know, the genocide to continue to be
perpetrated.
Chairman Gutierrez. Thank you--
Mr. Payne. One last point on that.
Chairman Gutierrez. Oh, sure.
Mr. Payne. We had capital market sanctions pass.
Congressman Tancredo, Congressman Wolf, all of us supported
capital market sanctions, which meant that if you did business
on Wall Street, you couldn't--if you did business in Sudan and
went to Wall Street, you were out. Now, that was really--that
was the hammer. Greenspan came up and met with the Senators and
said, ``You just can't let this go on. It will just disrupt--
it's just too--it's not our place.''
And our capital market sanctions, which we passed--we
passed it in the House. Like I said, one of my biggest
supporters on that bill was Congressman Tancredo, who stood up
and fought--you remember, Frank? And we passed it. It took
Greenspan from--Wall Street sent him here to say, ``Kill that
bill that Payne and Tancredo and those guys are pushing.''
So, you know, we have a lot of business people that just--
Chairman Gutierrez. Thank you.
Mr. Payne.--feel that they have to move on.
Chairman Gutierrez. We have about 7 minutes left before the
next vote on our side. I want to say thank you to Senator
Brownback for being here, to Congressmen Payne and Wolf, and my
good friend, Barbara Lee, for introducing the bill. We are
going to get this done.
We will recess, and 5 minutes after the last vote, we will
reconvene for the second panel.
[Recess]
Chairman Gutierrez. Let me--the subcommittee will come to
order. I want to thank the witnesses for their patience, as we
get about voting here, in the House of Representatives. And we
will proceed with opening statements by members of the
subcommittee before turning to the second panel for their
comments.
I would like to yield to the ranking member, Dr. Paul, for
any opening statement he might have.
Dr. Paul. Thank you, Mr. Chairman. I have just a brief
statement that I would like to make.
Mr. Chairman, H.R. 180 is premised on the assumption that
government-mandated divestment, sanctions, and other punitive
measures are always effective in influencing repressive regimes
when in fact this has not been proven.
Proponents of such methods fail to remember that where
goods and services don't cross borders too often, the troops
will. Sanctions against Cuba, Iraq, and numerous other
countries failed to topple their governments. Rather than
weakening dictators, these sanctions strengthened their hold on
power, and led to more suffering on the part of the Cuban and
Iraqi people.
So, to the extent that divestment effected changes in South
Africa, it was brought about by private individuals working
through the market to influence others. No one denies that the
humanitarian situation in Darfur is dire. But the United States
Government has no business entangling itself in this situation,
nor forcing divestment on unwilling parties.
Our witnesses should be commended on their actions to date
in publicizing the horrendous situation in Darfur, and
influencing people around the world to divest themselves of
investment in Sudan. Any further divestment action, however,
should be undertaken through voluntary means, and not by
government force.
H.R. 180 is an interventionist piece of legislation which
will extend the power of the Federal Government over American
businesses, force this country into yet another foreign policy
debacle, and do nothing to alleviate the suffering of the
residents of Darfur.
The exceptions made for contracting with companies that
provide arms to NGOs, and with companies operating in the oil-
rich Abyei province, would result in the exact opposite of the
bill's intended effect.
The regime in Khartoum would see no loss of oil revenues,
and the civil conflict would eventually flare up again.
The unintended consequences of this bill on American
workers, investors, and companies needs to be considered as
well. Cutting American citizens off from any involvement with
companies who may be only tangentially related to supporting
the Sudanese government could have serious economic
repercussions which need to be taken into account.
And that concludes my statement, and I yield back.
Chairman Gutierrez. Thank you to my ranking member. And
now, our second panel is comprised of some of the most
recognized experts on Africa, genocide, and the Darfur region.
Looking down the list of witnesses, I am pleased by the
diverse backgrounds our witnesses will bring to this issue, and
I look forward to a vibrant debate. I will briefly introduce
all of our witnesses now, and then we can proceed to their
testimony, uninterrupted.
First, we have Omer Ismail, who was born in the Darfur
region of Sudan, and has spent over 20 years working both
independently, and with international organizations on relief
efforts. Omer fled Sudan in 1989, as a result of his political
views. He then helped found the Sudan Democratic Forum, a think
tank of Sudanese intellectuals, working for the advancement of
democracy in Sudan, as well as co-founding the Darfur Peace and
Development organization, to raise awareness about the crisis
in his troubled region.
He currently works as policy advisor to several agencies,
working in crisis management and conflict resolution in Africa.
He is a fellow at the Kennedy School of Government at Harvard
University's Carr Center for Human Rights Policy.
Next, we have John Prendergast, senior adviser to the
International Crisis Group, and co-founder of the Enough
Campaign. Previously, John worked at the White House and the
State Department during the Clinton Administration, where he
was involved in a number of peace processes throughout Africa.
John has also worked for Members of Congress, the United
Nations, human rights organizations, and think tanks. He has
co-authored eight books on Africa, the latest of which he co-
authored with actor/activist Don Cheadle, entitled, ``Not on
Our Watch.'' John travels regularly to Africa's war zones on
fact-finding missions, peace-making initiatives, and awareness-
raising trips, involving network news programs, celebrities,
and politicians.
Next, we are joined by Michael L. Williams, chair of the
Texas Railroad Commission. Commissioner Williams was appointed
by former Governor George W. Bush, in December 1998, to serve
the unexpired term of Carole Keeton Rylander, and he was
elected by his fellow commissioners in September 1999 to chair
the Commission.
In November 2000, the people of Texas elected him to
complete the term expiring in the year 2002, and in November
2002, they re-affirmed their support by electing him to a term
expiring in 2008. He is the first African American in Texas
history to hold an executive statewide elective post, and is
the highest ranking African American in Texas State government.
Our next witness is Kenneth Bacon, president of Refugees
International. An expert in international affairs and security
issues, Mr. Bacon has concentrated on expanding refugees'
international capacity to promote more effective ways for the
international community to meet the needs of refugees and
displaced people.
Mr. Bacon is co-chairman of the Partnership for Effective
Peace Operation, and he serves on the boards of the American
University in Cairo, Population Action International and
Interaction. He is an emeritus trustee of Amherst College, and
Folger Shakespeare Library, and a member of the Council on
Foreign Relations and International Institute for Strategic
Studies.
Mr. Bacon also serves as Assistant Secretary, Public
Affairs, at the United States Department of Defense, and served
as Pentagon spokesman from 1994 to 2001.
Next, we have Adam Sterling, the director of the Sudan
Divestment Task Force, a project of the Genocide Intervention
Network. As the coordinating entity for the Sudan divestment
movement, the Sudan Divestment Task Force is actively involved
in dozens of successful and developing targeted Sudan
divestment campaigns around the world, at the university, asset
manager, city, State, and national levels.
Adam is a recent graduate of the University of California,
Los Angeles, with degrees in African American studies and
political science. Adam has received a number of humanitarian
awards, and serves as an advisor on Sudan engagement issues to
numerous State pension, State legislators, and Federal
representatives.
Finally, we have J. Stephen Morrison, director of the
African program at the Center for Strategic & International
Studies at CSIS. Mr. Morrison has overseen the revitalization
of the Africa program. In his role as director of the Africa
program, he has co-chaired two recent CSIS working groups that
examine the United States' rising energy states in Africa, and
the implications for U.S. foreign policy.
Since late 2001, he has also directed CSIS's task force on
HIV Aids, a multi-year project co-chaired by former Senator,
Bill Frisk, and Senator Russell Feingold. Currently, he is
leading the establishment of CSIS Nigeria, launching a project
on China and Africa, and carrying on CSIS work on the Sudan.
Please, Mr. Ismail?
STATEMENT OF OMER ISMAIL, FELLOW, KENNEDY SCHOOL OF GOVERNMENT
AT HARVARD'S CARR CENTER FOR HUMAN RIGHTS POLICY
Mr. Ismail. Thank you, Mr. Chairman, and Ranking Member
Paul, for this opportunity. I was born and raised in Al Fashir,
the capital of greater Darfur. My personal memories of Darfur
are in sharp contrast with the Darfur of today that has been
turned into killing fields by the government of Sudan and its
proxy militia, known as the Janjaweed.
I grew up in a region that was a picture of tolerance and
peaceful co-existence. It is true that environmental
degradation and the competition over meager resources has been
the cause of clashes between the different communities in the
region. These clashes, however, were limited in their scope,
and their impact is less destructive than what we have seen
today, and in recent years.
Furthermore, the local communities have their own organic
mechanism that dealt with the conflicts without extensive
intervention. As if the historical neglect of the region by the
successive national governments and the lack of meaningful
investment and delivery of services were not enough, the
current government has applied policies since the mid-1990's
that deepen the rift between the Darfurian communities,
resulting in the catastrophe that is unfolding there today.
The pressure imposed by the international community on the
government of Sudan resulted in the signing of the
comprehensive peace agreement between the government of Sudan
and the SPLM that has stopped war in the south and the Nuba
Mountains. Yet, Darfur is still a gaping wound, and a theater
to what is rightly called by this honorable institution,
genocide. If left to its own devices, this conflict will not
only destroy Darfur, it will threaten the CPA and, hence, the
future of the country as a whole.
The current situation in Darfur is like this. Today,
killing of civilians, rape, and sexual violence are widespread
and systematic. Torture continues, arbitrary arrest and
detention are common, as is repression of political dissent and
arbitrary restrictions on political freedoms. Mechanisms of
justice and accountability, where they exist, are under-
resourced, politically compromised, and ineffective.
Since May of last year, I have taken five trips to several
countries neighboring Sudan. I met with refugees fleeing the
devastated region who spoke of the continuation of the horrors
of war and abuse of human rights. I have met with aid workers,
human rights observers, African officials, and rebel leaders.
They all agree that the level of violence has increased, and
the protection of the refugees and the internally displaced
people has become almost impossible.
With access to the victims becoming more and more
difficult, and the attacks on the aid workers increasing, as
many as 400 of the 1,300 international aid workers in Darfur
have been either evacuated or relocated, putting more pressure
on an already tenuous situation.
What can we do? And faced with all this? I urge the United
States, as the only superpower in the world today, and with the
interest that it has in the security and stability of the
world, to do the following.
One, to work urgently with the Security Council to ensure
the implementation of the three-phased package agreed upon by
the government of Sudan and Mr. Kofi Annan in November of last
year in Addis Ababa, Ethiopia. The deployment of the United
Nations and AU peacekeeping or protection force is essential to
provide security to the citizens of Darfur, and the aid workers
assisting them.
And two, to consider the--considering the instrumental role
of the United States in the outcome of the DPA--that is, the
Darfur Peace Agreement--signed in May of last year, the United
States should also lead an international effort towards the
expansion of the DPA, to include the non-signatory rebel
groups, in addition to the representatives of civil society and
other stakeholders in the region.
And according to the reports of several human rights
groups, the United States has information that will be useful
in bringing those who have committed horrendous crimes in
Darfur to justice. With the utmost respect, and full
understanding of the position of the United States government,
vis a vis the ICC, as a Darfurian, who strives for justice for
my people, I urge the United States to avail that information
to the ICC, should that information in question be in the
custody of the United States.
There is no question that divestment also is an effective
tool in bringing pressure on the Sudanese government and
cutting off the funding that feeds the genocide. Many believe
that the campaign against Talisman Energy in 2001 accelerated
the signing of the 2003 comprehensive peace agreement with the
south.
Mr. Chairman, finally, I thank this committee and I thank
this institution. And I believe the freedom and security that
are enjoyed by the citizens of this country are universal
principles for dignity and the pursuit of happiness. With the
help of this body, and the representatives of the people of the
United States, I dream that one day the people of Sudan will
enjoy the same. Thank you.
[The prepared statement of Mr. Ismail can be found on page
48 of the appendix.]
Mr. Clay. [presiding] Thank you very much for your
testimony, Mr. Ismail. Mr. Prendergast, you may proceed.
STATEMENT OF JOHN PRENDERGAST, SENIOR ADVISOR, INTERNATIONAL
CRISIS GROUP
Mr. Prendergast. Thank you very much, Mr. Chairman, and all
the members of the subcommittee, for taking time out of your
schedules to look at this incredibly important issue.
News flash. After 4 years of unrelenting failure on the
part of this Administration's policy towards Darfur, President
Bush has finally decided that the present course of U.S. policy
is inadequate, and must be buttressed by more robust measures.
The heads of U.S. agencies, the principles committee has met 6
times in the last 3 months, and no decisions have been
announced yet, though we have been told that targeted sanctions
are going to be expanded against a few members of the Sudanese
government and rebel and militia--Janjaweed militia leaders and
a few companies linked to the Khartoum regime.
Consideration is also being given to how to restrict
Sudanese oil transactions, using U.S. dollars, which could add
some economic pressure on the regime. However, without
significant will and resources to expand and enforce such
measures, and without rapid follow-up with European and other
allies to prevent the Sudanese regime from switching to the
Euro or Yen in their transactions, these measures may prove to
be relatively fruitless.
In addition to divestment, I think there are three main
economic instruments that the United States and the broader
international community have at their disposal, but are not yet
utilizing.
Like divestment, none of these is likely, on its own, to
actually have a major economic impact. But the objective of
these sanctions is not only economic, it's political. These
measures would place a scarlet letter on the shirts of senior
officials who are responsible for atrocities, and are
undermining peace efforts, and hit them where it counts, in
their wallets.
The bet, based on empirical evidence from past efforts, is
that calculations of regime officials will change with the
introduction of real economic costs, combined with increased
isolation, globally. This isn't the Taliban. The Khartoum
regime wants to play ball internationally, and it doesn't want
to be an international pariah.
So, the regime's economic base won't collapse with the
introduction of these measures, but their political will to
continue will collapse, instead.
Beyond divestment, I think that the United States could
lead on three separate tracks. First, the United States can
lead on increasing, ramping up targeted sanctions against a
number of senior officials in Khartoum through the United
Nations Security Council, not just the small handful that the
United States is currently considering.
Second, the United States could take the lead in passing a
Security Council resolution establishing a panel of experts to
quickly ascertain where the assets of the largest Sudanese
companies owned by the ruling party officials are located, and
quickly move to freeze those assets.
Third, the United States could work with other countries to
develop a coalition that would notify certain banking
institutions that if they choose to continue conducting
business with the government of Sudan, or companies affiliated
with the ruling party, they will be cut off from the financial
systems of participating countries by a pre-determined date.
The United States recently imposed similar unilateral
measures on banks doing business with the regimes in Iran, and
they have had a direct impact. I think even more of an impact
would happen in the case of Sudan, if it was multi-lateral.
Finally, the central paradigm shift in U.S. policy must be
to move away from the current policy of constructive engagement
without any real leverage, to a more muscular policy focused on
walking softly and using a much bigger stick. Unfulfilled
threats and appeals should be replaced quickly with punitive
measures and policies that support a robust peace and
protection initiative.
Ultimately, with the right policies and increased levels of
engagement regarding Darfur, there is potential for the region
to be stabilized within a year. If not, it is almost a foregone
conclusion--and Omer and I have traveled together a number of
times in rebel-held areas of Darfur--it is a foregone
conclusion that if present trends continue with the restriction
of humanitarian access and increased insecurity, hundreds of
thousands more Darfurians will perish in 2007 on our watch.
Thank you.
[The prepared statement of Mr. Prendergast can be found on
page 59 of the appendix.]
Mr. Clay. Thank you for that chilling testimony. Mr.
Williams, you may proceed.
STATEMENT OF MICHAEL L. WILLIAMS, COMMISSIONER, RAILROAD
COMMISSION OF TEXAS
Mr. Williams. Mr. Chairman, Congressman Paul, it is good to
see you again. It is always good to be in this city and see
another Texan.
Thank you for this opportunity to address you and I am
grateful that you are considering this most important issue. As
you have just mentioned, my name is Michael Williams, for the
record.
And back in 1998, as was mentioned in the introduction, my
good friend, then the Governor of Texas, George W. Bush,
appointed me to a vacancy on the Railroad Commission of Texas.
Since that time, I have been elected statewide by the people of
Texas, both in 2000 for--to complete the unexpired term of my
predecessor, and then in 2002, for the full 6-year term.
And despite our name--and it's probably important to say on
the record that the Texas Railroad Commission has absolutely
nothing to do with railroads. Since 1981, the Texas Railroad
Commission has been, for the State of Texas, the principal oil,
natural gas, chemicals, and mining regulatory agency in the
State. And it's because of oil and gas, it's because of energy
that brings me to this issue.
I have been concerned about what has been happening in
Sudan dating back to the beginning of this decade, when I began
hearing the heart-wrenching stories of--regarding the decades-
long civil war between the government of Khartoum and the
southern rebels. That continued with conversations with
Sudanese who were living in Texas, regarding their experience
either back home, or what they were hearing from home, and
continued with the conversations with Dr. John Garang, who
obviously is now departed.
And hearing about those, and recognizing that in large part
what was fueling the devastation in Sudan was oil, obviously
each and every day that I get up I have the opportunity to make
sure that Texas and this country has abundant supplies of
affordable, clean, and reliable energy--primarily, in large
part, coming from crude. But in Sudan, crude is not used for
those purposes; crude is used for the propagation of
devastation.
And what I would like to do in the short time that I have
is to talk about what is happening in Texas today, beginning
with the leadership of the Governor of the State of Texas, who,
both in his state of the state address and his inaugural
address, came out in support of Texas joining a half-dozen
other States that have already moved to pass divestment
legislation across this country, and almost two-plus dozen
States who are now considering similar legislation.
I will also say that just today, as I have been here with
you, the Texas senate has taken up senate 247, the Texas
divestment bill, and it passed out of the Texas senate 29 to 0.
We have one senator who is ill, and who has not been able to
join the members of the Texas senate. We have another that I
understand was out of the city. So, it unanimously passed the
Texas senate.
And I think what it says is that it is extremely important
to Texans that we be on the right side in this issue. The Texas
divestment legislation impacts two of our large public pension
funds, the Teacher Retirement System of Texas--by its name,
obviously, all of our State teachers--the Employment Retirement
System of Texas, and together, it is estimated there may be
some $500 million to $600 million that might be covered there.
And I think it's also important to recognize that this is a
narrowly tailored bill that is designed to deal with only the
active direct holdings that are in the Texas--those two Texas
retirement funds. It does not impact mutual funds, it does not
impact the individual accounts that individual Texans have with
their 401(k)s, or their 457 plans.
But it is specifically directed at two areas that you heard
discussed earlier in your earlier panel, and even thus far in
this one. For all contracts, companies that have contracts with
the government of Sudan, or companies that have an equity
interest with the government of Sudan.
And I think, notably, the Texas divestment statute says
that a company that, in terms of its Sudanese activity, is
receiving 10 percent or more of its revenue from all activity,
and less than 75 percent of its activity is with the southern
Sudanese, or the marginal peoples of Sudan, that is a company
that would be identified and targeted. Similar, if more than 10
percent of its power generation was with the government of
Sudan, and less than 75 percent of the benefit of the
generation of that electricity is benefitting the people,
marginalized peoples, whether they be in Darfur, southern
Sudan, or elsewhere in the country.
The other thing that I think is notable about the Texas
legislation is that social development companies, those that
have provided humanitarian aid, whether it be medical supplies,
or education, or building orphanages are not covered here.
And I think, finally, because we recognize that the
construct and the deployment of foreign policy is the priority
and the privilege of the national government and not for State
government, there are certain exclusions. And one exclusion of
coverage would be for any company. The Federal Government
affirmatively exempts from its Federal sanctions, from your
Federal sanctions.
And, secondly, the law would expire if the President or the
Congress were to declare that the genocide has ended for 12
months, or that the United States invokes its sanctions on
Sudan.
Mr. Clay. Excuse me. The gentleman's time has expired.
Mr. Williams. I look forward to answering your questions.
[The prepared statement of Mr. Williams can be found on
page 68 of the appendix.]
Mr. Clay. Thank you so much, Mr. Williams. Thank you for
that testimony.
Mr. Bacon, please.
STATEMENT OF KENNETH H. BACON, PRESIDENT, REFUGEES
INTERNATIONAL
Mr. Bacon. Thank you very much, Mr. Chairman, Mr. Clay, and
Mr. Paul, for holding this hearing. Ever since the United
States, led by the House in 2004, declared the government of
Sudan guilty of genocide, the world has been waiting for the
United States to act.
Article 1 of the 1948 genocide convention says, ``The
contracting parties confirm that genocide is a crime,'' which
they undertake to prevent and punish. The Darfur Accountability
and Divestment Act of 2007 is a small step in that direction.
In light of the continuing death and displacement in Darfur,
the subcommittee may want to consider other, more painful,
financial interventions.
In September 2004, Secretary Powell accused the government
of Sudan of genocide, but he said that U.S. policy would not
change, meaning that the United States would take no military
action to stop the genocide. Instead, we have relied on
diplomacy and economic sanctions. So far, our policies have
failed.
What message has our inaction sent? Earlier this year,
Roger Winter, who advised the State Department on Sudan, told
the House subcommittee that impotent reactions to genocide by
the United States, the U.N., and Europe had no impact on
Sudan's leaders. Talk alone does not work, he said. Only
credible threats that cripple their agenda, or deprive them
personally of their power and ill-gotten riches will work.
In his classic book, ``The Roots of Evil,'' Ervin Staub, a
professor at the University of Massachusetts, says of the
Holocaust, ``The inaction of other countries, and their
unwillingness to help Jews confirmed the Nazis in the rightness
of what they were doing.''
The United States was silent and inactive in the face of
genocide in Rwanda in 1994. General Romeo Dallaire, the
commander of the U.N. force there, asked for authority to take
action to prevent the killing. On April 21st, after an
estimated 100,000 people had been butchered in Rwanda, Dallaire
said that with a force of 5,000 well-armed, well-trained
soldiers, and a clear mandate to act, he could stop the
genocide.
But on that same day, April 21st, the U.N. Security Council
voted to cut the U.N. assistance mission in Rwanda from 2,500
to 270. Even this was too large a force for then-United States
Secretary of State Warren Christopher. He instructed our
ambassador to the U.N. to vote for a full and orderly
withdrawal of all U.N. forces as soon as possible.
After Rwanda, a Senator said that if just two people in
every congressional district had told their elected
representatives that the United States should help stop the
genocide, U.S. policy might have been different. Yet, there was
silence.
At about the same time, the United States was also averting
its gaze to genocide in the Balkans, where 200,000 Muslims were
murdered by Serb forces between 1992 and mid-1995. Throughout
1993, confident that the U.N., the United States, and the
European community would take no military action, Serbs in
Bosnia freely committed genocide against Muslims, according to
the United Human Rights Campaign.
It was not until Serb forces systematically slaughtered
7,000 Muslim men and boys in Srebrenica that the United States
and its NATO allies employed decisive military force to end the
war.
We know today what is happening in Darfur. The estimated
number of people dead of war-related causes ranges from 200,000
to 500,000. There were 232,000 refugees from Darfur in Chad,
and 2.2 million Darfurians have fled to camps within Sudan.
Many of the displaced are Africans, whose villages have been
attacked by primarily Arab government and militia forces. The
destabilizing impact of the war is spreading to Chad, and the
central African republic.
In the last several months, the violence in Darfur has
worsened dramatically. Displacement is increasing, not
decreasing. Humanitarian workers are facing more attacks and
harassment from government forces, allied militias, rebel
groups, and bandits. Both the U.N. and major relief agencies
have warned that rising danger to their workers and operations
may force them to pull out of Darfur.
Every action by Sudan shows that it believes it can get
away with murder--and, in fact, it is. It is time to make clear
that Sudan will pay a price for the continued death and
displacement. H.R. 180 moves in that direction.
However, the subcommittee may also want to explore the
possibility of legislation that would directly or indirectly
bar banks used by Sudan and its leaders from access to the U.S.
financial system. That would sharply increase the cost and risk
of financial transactions by the government of Sudan or its top
officials.
History shows that we can't leave genocide unanswered, so I
encourage the subcommittee to take the strongest possible
measures against Sudan as soon as possible.
[The prepared statement of Mr. Bacon can be found on page
44 of the appendix.]
Mr. Clay. Thank you, Mr. Bacon, for that testimony.
And, Mr. Sterling, your turn.
STATEMENT OF ADAM STERLING, DIRECTOR, SUDAN DIVESTMENT TASK
FORCE
Mr. Sterling. Thank you, Mr. Chairman, and members of the
subcommittee. My name is Adam Sterling, and I am director of
the Sudan Divestment Task Force, a project of the Genocide
Intervention Network.
The Sudan Divestment Task Force has developed a unique
approach, focusing its efforts on the most egregiously
offending companies in Sudan. This approach, termed ``targeted
divestment,'' helps to maximize impact on the Sudanese
government, while minimizing potential harm to both innocent
Sudanese civilians, and investment returns here in the United
States.
I would like to first recognize Congressman Sherman, whom I
see here today. He was one of the first members to endorse
targeted divestment, not only at the University of California,
which became the first public school to divest from Sudan in
March of last year, but also one of the first members to
endorse targeted divestment for the entire State of California.
I would also like to recognize Congresswoman Lee for her
continuing efforts to support and encourage the divestment
movement. My organization supports H.R. 180, which authorizes
but does not mandate States and local entities to adopt
divestment programs, which requires further disclosure from
companies operating in Sudan, and then would prohibit U.S.
contracts only to those companies identified as being worst
offenders.
With my testimony today, I would like to briefly address
two issues. First, what is the current status of the Sudan
divestment movement? And, second, will Sudan divestment be
effective in changing the behavior of the Khartoum government?
In closing, I would like to highlight aspects of H.R. 180 that
I believe require additional attention, and would help address
the issues brought out by Congressman Paul.
First, what is the status of the Sudan divestment movement?
The States of New Jersey, Illinois, Oregon, Maine, California,
and Vermont have all approved divestment plans. North Carolina
State treasury and the Kentucky State teachers' retirement
system have independently divested a selection of Sudan-related
holdings. Many of these States have left open the option of
subsequent divestment.
Additionally, over 20 States now have active divestment
movements, with varying levels of involvement from State
officials. A large number of these have already begun
consideration of divestment in this year's legislative session.
Religious international campaigns have also gathered steam,
including an examination of the issue by Canadian universities
and provinces, and other active campaigns in Europe. Cities and
municipalities have begun consideration of divestment, as well.
At the university level, over 30 institutions have enacted
restrictions on their Sudan investments. At the company level,
engagement and divestment campaigns targeting fidelity in
Berkshire and Hathaway have been initiated. Finally, several
Sudan-free mutual funds have also recently been introduced.
Second, is divestment from Sudan effective? The Sudanese
government has a long history of susceptibility to economic
pressure, with a foreign debt nearly as large as its GDP. More
than U.S. diplomacy, the country has responded to U.S. economic
pressure in the past.
Despite this historical responsiveness, the regime has
faced little in the way of economic consequences for its
perpetuation of genocide in Darfur, heavily protected by a
small set of international protectors, whose commercial
interests in Sudan are very strong.
Indeed, while the regime has been brutal towards its own
citizens, it has been a shrewd attractor of foreign investment.
It currently ranks in the top 20 countries in the world in
attracting foreign investment dollars as a percentage of its
GDP, and it holds international investor conferences, even as
the genocide is ongoing.
This is a government acutely attuned to the country's
finances, but facing little challenge from the international
community. As if to emphasize this point, Sudan's president,
Omar Al-Bashir recently stated to the international press,
``When countries gave us sanctions, God gave us oil.''
Ironically, the number of countries propping up this
genocidal regime is relatively limited. While there are over
500 multi-nationals operating in Sudan, only a few dozen play a
truly detrimental role in the country. Moreover, the companies
that fiduciaries are beginning to choose as replacements may
very well perform better than the offending companies, since
over 20 U.S. States are currently considering divestment from
those very companies.
For example, one of the top targets of the divestment
campaign, PetroChina, is down 19 percent for the year. The
emerging Sudan divestment movement has already caught the eye
of the Sudanese government, which has spent considerable time
and energy attacking the campaign, even going so far as to
purchase a six-page ad for more than $1 million in the New York
Times to counteract the divestment movement.
Several major companies operating in Sudan have also
recently altered their business practices, largely in response
to the divestment movement.
Chairman Gutierrez. Mr. Sterling, you have 30 seconds left.
Mr. Sterling. Okay. While we strongly support the intention
of H.R. 180, we believe it would benefit from further attention
to the targeting of companies so that the worst offenders are
subject to punitive measures, and those companies without any
substantive business relationship with the government of Sudan,
and companies that may actually be providing tangible benefits
to Sudan's underserved periphery, are exempt from them. The
companies I have in mind are those already exempted from
existing U.S. sanctions by the Office of Foreign Asset Control.
We believe that H.R. 180 can effectively support the
growing divestment movement and create important disincentives
for companies contemplating or currently engaged in problematic
operations in Sudan. Thank you again for the opportunity to
address you today.
[The prepared statement of Mr. Sterling can be found on
page 64 of the appendix.]
Chairman Gutierrez. Thank you, Mr. Sterling.
Mr. Morrison, please.
STATEMENT OF J. STEPHEN MORRISON, DIRECTOR, AFRICA PROGRAM,
CENTER FOR STRATEGIC & INTERNATIONAL STUDIES
Mr. Morrison. Thank you, Mr. Chairman, Mr. Paul, Mr.
Sherman. Thank you for the opportunity to be here today. My
remarks are going to be focused on China and its economic
stakes, and the approach it has taken, diplomatically, with
respect to Sudan, and the question of the U.S. dialogue with
China on Sudan.
In terms of the economic stakes, in our estimation, Sudan's
contribution to China's total energy needs is important, but
not strategic. It represents about 5 to 7 percent of China's
oil consumption, which translates into about--one of its oil
imports--which translates into about 1 percent of its total
consumption, total energy consumption. Its oil fields are
modest. There have not been major new discoveries. Its oil
fields will decline fairly rapidly in the next decade.
China's accumulated economic stakes in Sudan are
significant, but not strategic. About $8 billion of sunken
investment, about $3 billion in annual 2-way trade--that's in a
context in which Africa represents, last year, about $50
billion in 2-way trade, growing very rapidly up to about $100
billion by 2010.
As far as China's evolving approach, the fundamental
approach has been one of pretty strong, staunch adherence to
the principle of national sovereignty and non-interference,
which is fundamental to China's foreign policy globally, and
has been the basis for China's tough opposition to U.N.
sanctions against the Sudan. And that became most obvious in
the Security Council debates, and intensified in the beginning
of mid-2004.
What we have seen, though, is stress upon China's adherence
to that principle, and that stress has come from several
sources. One is internal. There is an internal policy debate
that has been ongoing within China over the merits of this, and
that is fed by Chinese think tanks, academics, and global
business enterprises who are questioning why is it in China's
national interests to be an uncritical supporter of Khartoum
while China is attempting to establish itself as an ethical
global leader, global power?
The current minister of foreign affairs, Li Zhaoxing,
former ambassador to the United States, has been very much in
the lead, internally, in attempting to air these critical
opinions.
Second is the sensitivity and awareness of the power of
the--within the United States and northern Europe of many of
the representatives here today of the campaigns that they have
launched, and the fact that they have voiced allies in
Congress, access to media, internal organization, in pressure
for sanctions and other measures. This could extend,
potentially, to the 2008 Beijing Olympics.
A third factor is simply the opposition that China faces
within Africa itself. You have powerful African states--most
notably, South Africa, Rwanda, and Nigeria--with troops on the
ground in Darfur under AU mandate. They are blocked from
converting to more sustainable operations because of Khartoum's
intransigence.
Most recently, you have had the appointment of U.S. special
envoy Andrew Natsios who has opened a high-level dialogue with
the Chinese that did result in a shift in November towards
support of the Annan plan, the three-step phased plan which has
shown some minor progress, but more recently been blocked.
We have seen, in this most recent period, an
intensification of dialogue around what might be done next. In
this regard, we have seen some modest steps taken by the
Chinese, most importantly the statement issued after--issued by
the Chinese ambassador to the U.N., Wang Guangya, after
Bashir's letter was sent to the U.N. Secretary General, backing
away from the commitments made in November.
Our--in closing, our view is that there is an important
consensus that has taken place as to what needs to happen next
with respect to Darfur. That is full implementation of the
Annan plan, full deployment of the UN/AU hybrid force, a stable
cease fire, and effective political negotiations.
International sanctions that are on the table take many
different forms, and could have different impacts, both on
Chinese calculations and on the status of the U.S.
collaboration with China in trying to bring about greater
pressures upon Khartoum. We can go into the different forms of
those sanctions. Some are less threatening, and others are more
threatening to the Chinese stake.
There are immediate steps that we should be pushing the
Chinese on, one of which is to press them to move forward in
putting on the table deployment of specialized military units
for deployment into Darfur under the AU--in support of the AU/
U.N. force, using its public voice in the Security Council to
hold Khartoum to account, and adjusting its own economic
policies and instruments to distance itself, as it has most
recently in one of the downgrading steps it took on the access
to credit. Thank you very much.
[The prepared statement of Mr. Morrison can be found on
page 53 of the appendix.]
Chairman Gutierrez. Thank you very much. I would like to
recognize the gentleman from California for unanimous consent,
and share with my ranking member, Mr. Paul, that we haven't
used any of our 10-minute opening statements, so I would yield
to him 5 minutes of opening statements for the majority side.
Mr. Sherman. Thank you, Mr. Chairman. First, I would like
unanimous consent that the written testimony of the Armenian
assembly be entered into the record of today's hearing.
Chairman Gutierrez. Without objection, so ordered.
Mr. Sherman. Thank you, Mr. Chairman, for allowing me to
make an opening statement.
First, putting our country in perspective, there have been
three genocides aimed at Muslims in the last decade. They are
in Bosnia, Kosovo, and now Darfur. In each case, you can say
that America didn't do as much as we should have. But in every
one of those cases, we did more than anyone else. And those
around the world who claim that America has an anti-Muslim bias
will have to explain why, in focusing on Darfur, a Muslim
population subject to genocide, other countries aren't doing
even more than the United States.
Looking at H.R. 180, we should look at this current draft
as a floor, not a ceiling. I look forward to having similar
legislation with regard to Iran, and perhaps companies doing
business with any of the countries identified on the State
Department list of terrorist-supporting states.
But I will not encumber H.R. 180 with any amendment dealing
with any country other than Sudan. We ought to pass this bill
as quickly as possible, and then use it as a model, and again,
as a floor, not a ceiling, for what we do with other states
that are supporting terrorism, genocide, or other terrible acts
around the country or around the world.
This bill has two immediately effective provisions: naming
and shaming; and a ban on Federal contracts. We can do far more
to facilitate individuals who don't want to see their money
invested in companies that are investing in Sudan.
With TSP, this bill requires a study. We could, at minimum,
do more and say TSP must create a mirror image fund. So, for
those Federal employees who want to invest in the S&P 495--that
is to say the 500 minus those--and I don't know if it will be 5
or some other number, but whichever S&P 500 companies don't
invest in Sudan--that they have an opportunity to do so, rather
than waiting until some other mandatory decision is made.
Now, I wish TSP simply stopped investing in these
companies, and imposed that on all Federal employees and their
pension plans. But until that happens, at least those of us who
want to take an affirmative action to stop this ought to be
given the opportunity, while still investing in roughly 490
major American companies.
We ought to allow all private pension plans and trust funds
to divest, and to do so, we ought to, at the Federal level,
indicate that the fiduciary duty that a trustee has to
beneficiaries, or to pension plan participants, does not limit
that fiduciary in divesting from those who do business. Doing
the right thing is not something that you should be subject to
a lawsuit for.
We ought to perhaps require private pension plans to create
a mirror image fund. So if they don't take all their money out
of offending companies, at least where employees are given an
option there is a choice between the S&P 500 and what I am
calling the S&P 495.
We should change our tax law--I realize that's outside the
scope of this committee, by far--but there should not be a
capital gains tax if you move money from an offending company
into an equivalent investment in a non-offending company, or
move money from an S&P 500 fund to what I am calling an S&P 495
fund. We shouldn't tax people for doing the right thing.
We should allow public entities--namely, State and local
governments--to not contract with those companies doing
business in Sudan, just as we mandate the Federal Government do
that, we should at least allow--perhaps require--State and
local governments do the same.
Going beyond the voluntary, there are a couple of very
strong measures we could take. We could delist any offending
company, and not allow them to get any capital from Wall
Street, and we could prevent our banks from doing--especially
the Federal Reserve Board of New York--from doing dollar
business with banks doing business with Sudan, particularly
banks based in Sudan.
One thing you can do in China--because we're not going to
act on China any time soon--is identify for interested
Americans a particular Chinese company or companies, or a
particular Chinese product--you're not going to get Americans
to boycott everything made in China. But if you decide to focus
on one thing, we can get--you know, if the way to stop genocide
is to get the tennis shoes made in Indonesia, rather than the
ones made in China, my feet will do whatever you want them to
do.
Finally, if sanctions don't work in changing the Sudanese
government's policy, or they're not allowed to work, because
they're not tried on an effective basis, we may be in a
position where we either have to allow continued genocide, or
we have to consider such military actions as a no-fly zone, or
even more extreme, to arm the rebels. Both of those things are
things I would want to avoid, but I hope no one in Khartoum
believes that they are impossible. They ought to be
negotiating, knowing that those two possible violent actions,
or non-peaceful actions are on the table, and they ought to
come to the table and stop the genocide. Thank you.
Chairman Gutierrez. Thank you very much. Dr. Paul, please?
Dr. Paul. Thank you, Mr. Chairman. In my opening statement,
I expressed some lack of enthusiasm for sanctions. I like the
idea of voluntary sanctions, and I know you are willing to work
that way, and that is good.
And one of the reasons is there is not absolute proof that
they work. Some of the individuals in the Congress who are
strongly supportive of the sanctions under these circumstances
in Darfur don't like it for Cuba, and they didn't like it for
Iraq. So it is not an on-again, off-again.
I sort of think that the consistent position is that we
shouldn't do it. But I don't want to debate that issue as much
as the type of things, and what I see as a problem, because in
supporting certain groups we make a decision, and I think they
tend to come back to haunt us. There was a time, of course,
when we were allies with Osama bin Laden and Saddam Hussein,
and all these things come back to haunt us.
Too often, there are other motives, other than genocide.
And I don't know whether that is true or not, but I know that
we didn't send much help to Rwanda. We didn't send troops in
there to stop it, and we didn't have regime change, but they
didn't have oil, either. So I do want to talk about oil a
little bit, and Mr. Williams is probably the oil expert here.
The thing is, in this bill there is an exception that would
allow the United States to contract with companies that supply
arms to combatants, and that bothers me. So that means we're
going to pick sides. Now, there was a time when we picked sides
in Somalia, and things went badly. And now, just recently,
we're back in Somalia. We staged a coup there, and we invaded,
through our proxy army of Ethiopia, and we put in charge, once
again, the war lords that dragged our men through the streets.
And I would like to do my best to avoid those kinds of
problems.
And I see this as a potential, because with this military
exception--and also there is an exception that allows the
government to contract with companies that work in the one
area, Abyei, in the oil rich area. And it was mentioned earlier
in the testimony by Mr. Morrison that the Chinese are very,
very much involved in there, so, it seems to me like oil might
be a big issue.
There was a writer on this subject, John Laughlin, who
wrote a couple of years ago, whom I consider an expert in this
area. He says, ``According to Arab sources quoted by the
Turkish paper Zaman, `Oil is the basis of the crisis in
Darfur.'''
And so, there is genocide, but it might have started
because of oil. We may be going there for oil. And we didn't
get into Rwanda, and sometimes we get on the wrong side, and
it's already been indicated that if these sanctions don't work
we have to consider a regime change. Regime change is pretty
serious stuff, in my book. I mean, that's what we have been in
the business of doing too often. So, I would want to be
careful.
Now, if Mr. Williams, or maybe anybody--or Mr. Morrison
might comment on that, I would like to hear from you.
Mr. Williams. Well, Congressman Paul, let me see if I could
do two things. In terms of the way particularly the Texas
statute is structured, and I think many of the other State
statutes that are now going through their legislative processes
are structured, there is an attempt to draw a fairly--to the
extent that one can--a fairly bright line as to when we would
deploy these kinds of strategies, and when we wouldn't.
In the Texas statute, it says that when there is a
declaration of genocide by this body, the Congress, or by the
President of the United States--as you know, back home we have
had conversations about divestment for tobacco and pornography
and other things. But there is an attempt to draw a fairly
bright line and say that the only time that we will use this
kind of mechanism is in the genocidal area.
As it relates to oil, and as it relates to sort of allowing
for contracts that are in the southern region of the country,
or in Darfur, or in other parts of the country, but not with
the government of Sudan and Khartoum, the idea, quite frankly,
I take it, is--sort of shared with your opening comments--that
one way that we can be helpful is, obviously, to encourage
investment, but to encourage investment that does not benefit
the government of Sudan.
And so, when it is with the regional government in the
south, or when it's with one of the other areas, that does--
that would allow for those crude revenues to be used for the
people of Sudan, not for the government of Sudan, in the way
that they're using it in order to be warring against the--its
own people. That is the way we have tried to structure the
Texas bill.
And that is sort of--I think we have to recognize that
crude does play a role. But we also, I think, have to recognize
that there is a way to use crude, quite frankly, that is
beneficial. And we want to allow the beneficial use of crude.
Mr. Morrison. Yes, Mr. Paul, just a couple of corrections,
I think, to the record. I mean, the big oil discoveries were
undertaken--Chevron, in the period 1979 to 1983, there was $1
billion invested, about 90 exploratory efforts that were--many
of which were successful, and they were able to prove some
modest deposits over an area that was a transition zone between
the north and the south. And this had a big trip wire effect in
setting off the north/south war, which began in 1983.
The oil sector laid dormant until 1996, 1997. Chevron
withdrew. It was dormant until the Chinese came in, along with,
subsequently, the Indians and the Malaysians. There was a
Canadian private sector involved. Oil began to flow in the fall
of 1999 out of these deposits. Oil is now up to about half-a-
million barrels a day.
It is not really emanating in any significant degree from
Darfur, and has not been a factor, directly, in stirring
conflict in Darfur. It has been a direct factor in stirring the
war between the north and the south. It went on between 1983
until January of 2005, when the north/south peace accord was
consummated.
The continued production of the oil sector, and the wealth
sharing agreement under the north/south peace accord, in which
there is a 50/50 split in earnings, the continued production of
oil sustains not just players in the north, but the government
of southern Sudan, which is the direct beneficiary of 50
percent of the oil earnings coming out of that.
Now, you can argue, as many have, that the implementation
of that wealth sharing agreement remains very flawed and
ambiguous, and needs much further improvement. And as you move
towards full implementation, and the possibility of a vote on
secession by the south, you are likely to see quite a bit of
conflict around where the border area is demarcated, and some
of the actions taken within the three special zones.
But as with respect to Darfur, it's not a driving factor.
The Darfur conflict is not an oil-driven conflict. It's much
more than a conflict between the north and the south.
Dr. Paul. I just want to make one brief comment, but I
still find it interesting that the one exception is to allow
the government to contract with the companies that are in the
oil-rich region. It seems to me that if we were dealing with
only the genocide, we could delete that part, and just deal
with that, as a whole, instead of looking like we're pumping in
weapons into an area that we may become obligated to. And I
yield back.
Chairman Gutierrez. Thank you, Dr. Paul. Mr. Ismail, first
of all, I would like to share with you that my grandson,
Luisito, I asked him where his mom was last week, and he said,
``She is at a meeting about Darfur.'' And I share that with
you, because I know how important it has been to me and to
others, as you fight for things, to know that your message is
getting out, and that when 4-year-olds report to their
grandparents where their daughters are at, and refer to the
meeting about Darfur, you know that it's significant.
And so, I wanted to share that with you, that your
message--keep working, it's getting out there. People, 4-year-
olds, are talking about it. And I think that speaks volumes
about where we are going with this issue.
Mr. Ismail, you make several policy suggestions in your
testimony, and I want to thank you for being specific in your
suggestions. One item you mentioned is having the U.S. State
Department develop a list of ``worst offenders.'' What would
the criteria be for the list, and would the State Department
develop the list on its own, or do you recommend requiring the
Department to work with NGOs, or other outside groups?
Mr. Ismail. Thank you, Mr. Chairman. And the fact that a
lot of people here and outside of this institution are working
on the effort of Darfur is refreshing to see.
However, we all understand what is at stake. There is a
genocide going on. We hope that this awareness will be
translated into policies that are going to stop the genocide.
Talking about it is important; doing something to stop it is
even more important. And my, you know, respect to your family
for being part of this.
Chairman Gutierrez. Thank you.
Mr. Ismail. Yes. The worst offenders, as alluded to by Mr.
Sterling and others, and in the bill itself, these are the
people who are doing direct investment or indirect investment
with the companies that are working with Sudan. And they are
the companies that are feeding this genocide.
If we can--because of the name-calling, or the shaming of
these companies is concerned, if we can have that list out
there, and people see that these companies are working there.
The criteria can be that these are the companies that are
working directly with the oil industry in China, for example,
because we understand, from the presentation by everybody
here--Dr. Morrison included--that this oil that is coming out
of Sudan, shared 50/50 between the government of Sudan to the
north and the government of the south, they all report that 70
percent of that money that is coming out of this is used by the
government of Sudan in buying arms to kill its own people, and
to join in this genocide that is going on.
So, if we can make a direct link between these companies
who are working in this very, very important sector, and we
publish that out there, and let the investors see it, and even
the public, they will know that these are the worst offenders,
and then they will stop dealing with these companies. And then
we will see the effect of that.
The ad that the government of Sudan took in the New York
Times shows clearly that the government of Sudan is paying
attention to this divestment campaign. So if we can make the
same thing, counter to what the government of Sudan has done,
we publish our own information about these companies, I think
that will be very effective.
Chairman Gutierrez. Let me share with all of the members of
this panel that Chairman Barney Frank was working on the bill
on the House Floor on Hurricane Katrina. That's why he wasn't
here, and he wanted me to express his apologies for not being
here, but stated once again--and he is--Mr. Ismail, mark my
words, we will work on this quickly. It will be more than--we
are gathering the information today, important testimony and
work today, we will work on it quickly here, in this committee.
Let me ask Commissioner Williams. In your testimony, you
discuss broad support in Texas for a State divestment law. We
also had broad support in my State of Illinois for a Darfur
divestment law, which was enacted, but in February, was struck
down by Federal district court as unconstitutional. Are you
concerned that the same fate awaits the eventual Texas law, if
the Darfur Accountability Divestment Act is not passed by
Congress? And if not, why not?
Mr. Williams. Mr. Chairman, I am not, but for two reasons.
These are things that have happened since the State of Illinois
passed its legislation.
The first one is that, obviously, there is a provision in
the bill that you are now considering that will provide some
degree of--that would remove the cloud over State and local and
university divestment programs. So, obviously, we would
encourage the passage of that. That is one way that the
Congress could surely help States like Texas, and the others
that are considering it.
The other thing, as I mentioned in the opening remarks, is
that there are a number of things that we have done in the
Texas legislation that we think recognize that the Federal
Government has the pre-eminent responsibility for foreign
policy. And so--and there is language in the bill that says
that if there is anything in the bill that conflicts with the
Federal Government's responsibility to conduct foreign policy,
then that provision of the bill is inapplicable.
And even though I don't think there is anything in there,
we say that if the Congress were to remove sanctions, then at
that time the bill would expire, that if the President or the
Congress were to declare that the genocide has ended, and it
has been more than 12 months, then the bill would expire. So I
think there have been safeguards built into the bill.
Chairman Gutierrez. Let me ask Mr. Morrison. So, China.
What advice do you give us? What do we do with China?
Specifically, what can the Congress do? What can the Federal
Government do? What can the President do? What can the
executive branch--ideas of what we can do, if these investments
are strategic?
I just kind of look at China, and I can't recall the last
time they were affirmative about human rights when it came in
conflict with their quest for raw materials. And so I know you
have stated that these are--that the oil and the raw materials
and the investments are small, but it seems as though China is
so hungry for steel and machinery and technology and oil, and
its consumption of all of those--and it's only going to
expand--what can we do? How do we sit down with the Chinese and
reach an agreement?
Because they seem to be, from everything we have heard here
today, and everything I have read, a huge impediment to ending
the genocide in Darfur. Mr. Morrison?
Mr. Morrison. I think you need to attempt to intensify
the--from multiple directions, intensify the discomfort around
an uncritical embrace of Khartoum's position.
I have mentioned that they are vulnerable and sensitive on
several fronts. One is the reputational and image damage that
has been suffered in North America and Europe, and within
Africa. A second is the discontent that is beginning to surface
internally, among elite foreign policy circles within China
itself.
You can play on that. You can play on the desire to be seen
as a rising ethical global power within the Security Council,
within major institutional institutions, international
institutions. You can begin to put forward incremental critical
tests around whether the Chinese are prepared to divert from a
rigid adherence to this non-interference respect for
sovereignty which has been the sort of blockage, or the
ideological, or the veil behind which China could stand and
say, ``Well, this is too far, we don't want to go there.''
You can test that in some of the ways that I have talked
about: overt public criticism within the Security Council of
the positions that have been taken by Bashir and others in
defiance of the Annan plan; bringing it back into focus around
the elements of the Annan plan; the three-phased deployment of
the AU/U.N. force; the need for a cease fire; and the need for
accelerated political negotiations within Darfur.
There is a consensus around the way forward, and what needs
to happen, that is shared by the United States and the Chinese,
and others, around what the ultimate fix is going to be for
Darfur. We should be pushing the Chinese to get more vocal
around those issues, and to begin to use its own internal
economic policies and instruments to signal to Sudan that its
ardor for the opportunities that are there is declining, and
more can be done along those fronts. Thank you.
Chairman Gutierrez. Thank you. For a second round, Dr.
Paul?
Dr. Paul. I don't have any questions.
Chairman Gutierrez. Dr. Paul doesn't have any more
questions. Mr. Sherman, do you have any further questions, sir?
Mr. Sherman. Oh, yes. Section three of the proposed bill
says that States and cities that have divested or are in the
process of divesting State and city funds are recognized and
supported by Congress.
Is this enough to eliminate all of the constitutional
attacks that could come against cities, counties, and school
districts, as well as State governments who choose to divest?
Does this solve the legal problem completely, or do we need to
make it stronger?
Mr. Sterling. We would encourage the sponsors of this
legislation to meet and connect with the sponsors of the
legislation in the Senate. Senators Durbin and Cornyn recently
introduced the Sudan Divestment Authorization Act, which
exclusively looks at the issue of authorization, and deals with
it in a more comprehensive manner.
Mr. Sherman. Okay.
Mr. Sterling. So I know there has been some--
Mr. Sherman. Going on, what I see is missing here is most
of these funds that sub-national governments have are pension
plans. And the trustees of those pension plans--at least one of
you may be a trustee of the pension plans--have a fiduciary
duty to seek the highest rate of return.
Do we need a provision in this bill indicating that
fiduciaries, at least of governmental pension plans, and
perhaps all trusts and all pension plans, may divest without
being subject to lawsuits or other claims for, arguably,
receiving a lower rate of return?
Mr. Sterling. I think it's definitely something to look at.
The legislation that is in Texas that we developed and now is
currently the leading model in the country, has a specific
section that excludes the fiduciaries for this specific case
from conflict with their constitutional fiduciary obligations.
So, we have dealt with that in the State legislation, but
it may--in other models, it may be something to look at for--
Mr. Sherman. And I do think we have to research whether the
Federal Government can change the fiduciary duties of trustees
of trusts which are usually established under State law. I
would think so, since we do have the constitutional right to
create American foreign policy, and that's what we are doing.
Our goal here is kind of to create a chain reaction. The
goal is to change the behavior of the government of Sudan by
denying it certain foreign investment. And then, we are trying
to change the behavior of corporations and business entities by
afflicting them with various disadvantages here in the United
States if they don't change their behavior in an effort to
change the Sudan government's behavior.
First, what is the Achilles heel of the Sudanese
government? What kinds of foreign investment--denial of foreign
investments--would cause them to come to the negotiating table
seriously, to not only accept, but welcome UN-led troops, and
to do the other things necessary to stop this genocide?
If we had to take some type of foreign investment away from
Sudan, what would it be?
Mr. Prendergast. I want to make--give you a political
argument while my colleagues think of the economic one, because
it's a great question, it's the central question. Where is the
leverage, and where can we influence change?
My view is, having negotiated and worked in Sudan, and
negotiated with the Sudanese regime in the last Administration
directly with Bashir and Taha, and the rest of them, is that
they don't want to be singled out in the way that some of these
economic instruments would single them out, target them,
tarnish their image internationally, with very specific--
particularly, if it's done through the United Nations Security
Council. It's much easier for them to dismiss, if it's only the
United States doing these things unilaterally. If we work
multi-laterally--
Mr. Sherman. But the things we're considering in this bill
aren't going to pass a U.N. resolution unless we start, I
guess, boycotting Chinese companies in an effort to get that
government to change its actions. This bill is focused--its
naming and shaming is being done by the United States, a
country whose naming and shaming is laughed off in some
quarters.
Mr. Prendergast. Yes. Some of the instruments that you have
mentioned in your own first introductory comments were what I
was referring to. But with respect specifically to divestment,
as we worked on this 15 years ago, and with respect to South
Africa, and globalized the divestment movement, I think the
kind of--the naming and shaming actually will take on quite
substantial portions if we're only talking about divestment.
Of course, as anyone will tell you, it's not--this isolated
and only by itself, divestment will mean very little. But if
there is an array of instruments--
Mr. Sherman. I will ask whether any of your colleagues have
an economic answer. Obviously, the--
Chairman Gutierrez. Thirty seconds.
Mr. Sherman.--Sudanese government is going to love this
bill, because of its political connotations, but economically,
what can't they afford to lose?
Mr. Sterling. I mean, as I mentioned in my testimony, they
have a debt larger than their GDP. They cannot afford the way
oil consortiums are established in Sudan. They don't have the
resources or capital to extract, refine, and distribute the
revenue on the open market, so they need their partners, the
Chinese, Malaysians, Indians, to establish these consortiums.
So they're definitely dependent--
Mr. Sherman. They need cash to be invested in the royal
sector. And I yield back.
Mr. Sterling. Correct.
Chairman Gutierrez. Thank you, Mr. Sherman. I want to go
back to Mr. Bacon, please, for a moment, and especially given
your unique situation on the panel, having worked on--at the
Pentagon for 7 or 8 years, during the Clinton Administration.
In your testimony, in addition to Darfur, you mentioned
Rwanda and Bosnia. I think it's appropriate to mention recent
instances of genocide in other parts of the world, and our
inaction or delayed actions. Why are we, the United States, the
Congress, the White House, so reluctant to stop these
genocides? Why are we so slow to respond? And what can we do to
change that?
Mr. Bacon. Well, it's a very good question, and I think
that Mr. Sherman--we should give him credit. He framed it in a
very interesting way. He said that we didn't do enough, but we
did more than anybody else.
If you look at what happened in the Balkans--we did nothing
in Rwanda. I don't think we can give ourselves credit there.
But in the Balkans, we finally did act, and we acted relatively
quickly in Kosovo. It took us longer to react to protect the
Bosnians.
I think, you know, the history shows that there is a great
inclination to avert our gaze to ugly events taking place in
other parts of the world, to explain them away as age-old
political rivalries, tribal rivalries, problems we don't
understand and can't influence very well. And then, before we
know it, while we're looking away, suddenly the death toll
mounts very rapidly, and it's hard to get in.
Clearly, we are learning. We learned in Somalia, and we
learned--we are learning today in Iraq, that we shouldn't use
force in a casual way. It has to be well thought-out. We have
to do it with determination, and we have to do it with a fair
amount of skill. So that--of course, force should not be used
casually. It should only be used as a last resort.
I think that what is significant today about Darfur is that
there is a nationwide movement. If you travel through
Washington, D.C., or through Austin, Texas, or through parts of
Illinois, you will see signs outside of synagogues and churches
for ``Save Darfur.'' As you pointed out, your grandchild is
talking about it, and there are children and college students
all around the country talking about it.
This Administration is the first Administration ever to use
the term ``genocide'' to describe a contemporaneous killing--
not historical, but contemporaneous. And yet, it has found it
very difficult to act according to the genocide convention,
which obligates signatories to prevent and punish genocide. We
haven't been able to do enough.
These aren't easy problems. But the one thing that you can
count on is that they always get worse by waiting, and a quick
intervention almost always has a much better chance of
succeeding than a late intervention. So those are my thoughts
on your question, which I think is a very good question--
Chairman Gutierrez. Thank you.
Mr. Bacon.--a question that I wish more politicians asked.
Chairman Gutierrez. Thank you. Mr. Prendergast, in your
testimony you mentioned that economic pressure, through the
restriction of Sudanese oil transaction using U.S. dollars will
not be effective without follow-up to prevent the Sudanese
regime from switching to Euro or Yen transactions.
Specifically, how would the United States conduct this
follow-up, and is there any risk that Sudan would switch to
the--
Mr. Prendergast. I think if we're going to go down this
path--and this appears to be the direction that the plan B
threatened escalation part of the Administration is going,
which is a set of financial measures that would increase
pressure and restrict access for Sudanese companies from doing
business internationally, I think that we are going to have to
dedicate a lot more.
I think the implication from this committee is that there
is going to have to be more resources committed to implementing
these decisions, because OFAC--the Treasury is stretched to
capacity to oversee and monitor the implementations of the
sanctions regimes we have against various individuals,
terrorist organizations, and some of the state-sponsored
terrorists.
So, if we're going to expand the restriction of businesses,
Sudanese businesses or transactions by Sudanese companies doing
business with international financial institutions, there is
going to have to be increased resources to monitor, and we're
going to have to do more diplomacy, economic diplomacy, to get
other nations to go along with the plan, because it's very
simple for the government of Sudan, over time, to use other
instruments of economic exchange.
Chairman Gutierrez. Mr. Morrison, would you care to comment
on this?
Mr. Morrison. I would like to comment--
Chairman Gutierrez. On the previous question. I'm sorry.
Mr. Morrison.--on what Ken was talking about. Just to
emphasize that, we have had this remarkable mobilization within
American society around Darfur, and around--it seems to be a
fairly broad consensus that what has happened there constitutes
genocide.
It has been a difficult sell, outside--well, within the
United States, within the professional human rights community,
which has not signed on to that notion of genocide, if you look
at the careful sort of determinations made by groups like Human
Rights Watch, Amnesty International--if you look at
international organizations, the international criminal court,
the U.N. Investigative Commission, they refrained from reaching
that conclusion, and used other language having to do with war
crimes, crimes against humanity.
No doubt looking at heinous acts repeated at the
instigation of the government of Khartoum, but it didn't push
through the threshold of becoming genocide, which evokes
another level of emotion and response.
It's not that--the genocide designation has not been taken
up by governments within Europe, by the AU, and certainly this
has been complicated within the Arab world by the hangover
effects of the Iraq debacle, in which this is played to the
advantage of Khartoum and its allies in painting this as some
sort of regime change proxy. And so it's been used as a defense
against seeing the realities of what has been going on, in
terms of the carnage on the ground.
All of these factors have been very important in dulling
the response. And it has called into question, you know, what
happens when you're in a situation like this, where there is
such a concentrated consensus around genocide within our own
borders, but it does not extend very effectively outside, even
though there is a shared consciousness that there is something
horrible that has been happening.
Chairman Gutierrez. Thank you.
Mrs. Maloney. I want to thank the panelists, and I want to
thank the chairman, and I would just like to ask any of the
panelists how effective do you think this approach will be in
influencing the Sudanese government to change its policies, and
how will it directly affect the government's standing and
tenure?
Mr. Bacon. Well, I think it will be a step. It will be one
piece of pressure that will, I hope, add up with other pieces
of pressure. I said in my testimony that I think it would be
great if the committee would look at stronger measures, maybe
add stronger measures to H.R. 180.
We have just seen, in the last few months, how effective
interventions through the banking system and the payment
systems have been on North Korea, a country that many of us
thought was beyond influencing. And yet, using section 311 of
the Patriot Act, we were able to really shut down their work in
the international financial system, and make trade much more
difficult for them. It makes all financial transactions much
more costly and much riskier.
This would apply not only to the country, but it would
apply to people in leadership positions, who may have set up
bank accounts around the world with gains, whether honestly
gotten or ill-gotten, but it would be a way of increasing
pressure dramatically on the country and the regime.
I think we have to look at a galaxy of actions, a
constellation of actions, not just one. And I think we need to
do it relatively quickly, because the situation in Darfur today
is getting worse. The displacement is increasing, the inability
to deliver humanitarian aid is increasing. There are many, many
more obstacles to the relief organizations and to the U.N., so,
if we don't act soon, we could be looking at a much greater
death rate in the future than we have seen in the recent past.
Mrs. Maloney. Would anyone else like to comment?
Mr. Ismail. I would like to say that none of these measures
taken, in itself, or any of the recommendations that we make,
after looking at the reports that are coming from out there,
and analyzing them, and talking to the people on the ground
almost on a daily basis, then we make these recommendations.
However, isolated from being a package, it is--none of
these is going to work. So the divestment has to be working
with other things. It's a tool in a tool box that we will have
to use together, in order to be effective.
And also, people having in the back of their minds that
this divestment campaign is only meant to target companies that
are working with China, or just working in the oil industry,
that is not the whole picture. Because being a Sudanese, and
knowing the ties of this government with the Arab world, for
example, there is a lot of Arab money--hard and soft money--
that is being invested inside Sudan, not only in the oil
industry, but for example, in tourism. There are two hotels.
The best hotels are giving, you know, the Sudan--the first
five-star hotels, these are built with Libyan and monies from
the United Arab Emirates.
There are other monies that are working in the
infrastructure, on the road system, and telecommunication. This
is all money that is coming from the other side of the Red Sea.
And people don't see that, because it's the direct kind of
investment that is coming from across the Red Sea without
coming through the bigger financial institutions, or being part
of the--of Wall Street, or the--sometimes one single sheik who
has billions of dollars can just tell the government of Sudan,
``Here is $200 billion. Build the presidential villas'' that
they spent millions of dollars, or the yacht that Omar Bashir
is enjoying today.
So, that is not part of all this. And we have to look at it
in that respect, as well.
Mrs. Maloney. Now, my time is almost up, but I would also
like to ask if anyone would like to comment on what are your
concerns about how divestment would affect the people of Sudan,
from an economic point of view.
Do you think it will hurt the people, or--what are your
comments on that?
Mr. Ismail. If I may?
Mrs. Maloney. Sure. Anyone.
Mr. Ismail. I don't think--because the investment that the
government of Sudan is investing in the rest of the country
outside of Khartoum is almost meager. If you look at the
figures from the Bank of Sudan, for example, last year the
government of Sudan invested .5 percent in the south, .5
percent. Not even 1 percent in southern Sudan.
So, if you look at the education, if you are looking at the
health care sector, if you are looking at any other--the
infrastructure sector, there is none of that. That has been
invested in the rest of the country outside of Khartoum, and
that is where 80 percent to 90 percent of the Sudanese are, and
these are the lower income groups, anyway.
Mrs. Maloney. Any other comments?
Okay. My time is expired. Thank you.
Chairman Gutierrez. I thank the gentlelady for joining us.
Let me just share that Congresswoman Maxine Waters sends her
regrets. Unfortunately, the Financial Services Committee has
under its charge Katrina, and the bill was marked up and it's
on the House Floor today. So there is a lot of conflict
between, obviously, Darfur and taking care of our own domestic
issues in Louisiana that we want to--and Mississippi--that we
want to--and Louisiana that we want to address today, too.
I want to thank you all for being here. You have been
wonderfully educational to all of us. And on behalf of this
subcommittee, and everyone on the full committee, thank you so
much. And Godspeed to you, Mr. Ismail, and your people. Thank
you.
[Whereupon, at 4:22 p.m., the hearing was adjourned.]
A P P E N D I X
March 20, 2007
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