[Senate Hearing 112-112]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 112-112

                        U.S. POLICY TOWARD IRAQ

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

                                HEARING

                               before the

                      COMMITTEE ON ARMED SERVICES
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                            FEBRUARY 3, 2011

                               __________

         Printed for the use of the Committee on Armed Services









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                      COMMITTEE ON ARMED SERVICES

                     CARL LEVIN, Michigan, Chairman

JOSEPH I. LIEBERMAN, Connecticut     JOHN McCAIN, Arizona
JACK REED, Rhode Island              JAMES M. INHOFE, Oklahoma
DANIEL K. AKAKA, Hawaii              JEFF SESSIONS, Alabama
E. BENJAMIN NELSON, Nebraska         SAXBY CHAMBLISS, Georgia
JIM WEBB, Virginia                   ROGER F. WICKER, Mississippi
CLAIRE McCASKILL, Missouri           SCOTT P. BROWN, Massachusetts
MARK UDALL, Colorado                 ROB PORTMAN, Ohio
KAY R. HAGAN, North Carolina         KELLY AYOTTE, New Hampshire
MARK BEGICH, Alaska                  SUSAN M. COLLINS, Maine
JOE MANCHIN III, West Virginia       LINDSEY GRAHAM, South Carolina
JEANNE SHAHEEN, New Hampshire        JOHN CORNYN, Texas
KIRSTEN E. GILLIBRAND, New York      DAVID VITTER, Louisiana
RICHARD BLUMENTHAL, Connecticut

                   Richard D. DeBobes, Staff Director

               David M. Morriss, Minority Staff Director

                                  (ii)












                            C O N T E N T S

                               __________

                    CHRONOLOGICAL LIST OF WITNESSES

                        U.S. Policy Toward Iraq

                            february 3, 2011

                                                                   Page

Austin, GEN Lloyd J., III, USA, Commander, U.S. Forces-Iraq......     6
Jeffrey, Hon. James F., U.S. Ambassador to Iraq..................     7

                                 (iii)

 
                        U.S. POLICY TOWARD IRAQ

                              ----------                              


                       THURSDAY, FEBRUARY 3, 2011

                                       U.S. Senate,
                               Committee on Armed Services,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:04 a.m. in 
room SD-106, Dirksen Senate Office Building, Senator Carl Levin 
(chairman) presiding.
    Committee members present: Senators Levin, Lieberman, Reed, 
Akaka, Nelson, Webb, Udall, Hagan, Begich, Manchin, Shaheen, 
Gillibrand, Blumenthal, McCain, Wicker, Brown, Portman, Ayotte, 
Collins, and Graham.
    Committee staff members present: Richard D. DeBobes, staff 
director; and Leah C. Brewer, nominations and hearings clerk.
    Majority staff members present: Ilona R. Cohen, counsel; 
Jessica L. Kingston, research assistant; Peter K. Levine, 
general counsel; William G.P. Monahan, counsel; Michael J. 
Noblet, professional staff member; and William K. Sutey, 
professional staff member.
    Minority staff members present: David M. Morriss, minority 
staff director; Adam J. Barker, professional staff member; 
Christian D. Brose, professional staff member; Michael V. 
Kostiw, professional staff member; and Diana G. Tabler, 
professional staff member.
    Staff assistants present: Jennifer R. Knowles, Christine G. 
Lang, and Breon N. Wells.
    Committee members' assistants present: Vance Serchuk, 
assistant to Senator Lieberman; Carolyn Chuhta, assistant to 
Senator Reed; Nick Ikeda, assistant to Senator Akaka; Ann 
Premer, assistant to Senator Ben Nelson; Gordon Peterson, 
assistant to Senator Webb; Jennifer Barrett, assistant to 
Senator Udall; Roger Pena, assistant to Senator Hagan; Lindsay 
Kavanaugh, assistant to Senator Begich; Joanne McLaughlin, 
assistant to Senator Manchin; Clyde Taylor IV, assistant to 
Senator Chambliss; Charles Prosch, assistant to Senator Brown; 
Ryan Kaldahl, assistant to Senator Collins; and Andy Olson, 
assistant to Senator Graham.

       OPENING STATEMENT OF SENATOR CARL LEVIN, CHAIRMAN

    Chairman Levin. Good morning, everybody. Welcome first to 
our witnesses, U.S. Ambassador to Iraq James Jeffrey and 
General Lloyd Austin, Commander, U.S. Forces-Iraq (USF-I).
    Before we begin, I want to extend a warm welcome to the 
newest members of the Senate Armed Services Committee (SASC): 
Senator Jeanne Shaheen, Senator Kirsten Gillibrand, Senator 
Richard Blumenthal on the majority side; and Senator Rob 
Portman and Senator Kelly Ayotte on the minority side. We also 
welcome back Senator John Cornyn, who is rejoining the 
committee after a brief hiatus.
    This committee, as you will soon learn, has a tradition of 
bipartisanship. It is a long tradition. It is based on our 
common desire to provide our men and women in uniform and their 
families the support that they need and the support that they 
deserve. That goal makes the work of this committee truly 
rewarding.
    Senator Reed, Senator Tester, and I recently returned from 
visiting Iraq. One of my main impressions was that the team of 
Ambassador Jeffrey and General Austin is providing the strong 
leadership needed to manage the critical transition over the 
coming year leading up to the December 2011 deadline for 
withdrawal of all U.S. military forces from Iraq, a deadline 
that was set by President Bush and Prime Minister Maliki in the 
November 2008 Security Agreement that they entered into.
    I believe that you two gentlemen are the right team to lead 
that transition and on behalf of the committee let me thank you 
both for your service and for the service of the men and women 
with whom you serve.
    Last December, after 8 months of discussions among Iraq's 
political leaders, those leaders agreed to form a national 
unity government. But the agreement was only partial. Iraq 
still awaits the nominations by Prime Minister Maliki to the 
key cabinet positions of Iraq Minister of Defense (MOD), Iraq 
Minister of Interior (MOI), and Iraq Minister of National 
Security, as well as the resolution of issues relating to the 
powers of the National Council on Higher Priorities to be 
headed by former Prime Minister Allawi. The pressure on the 
Iraqi Government to fill in those large gaps must continue.
    During our trip to Iraq, we were told that plans are on 
track for the drawdown of U.S. forces and the shift of lead 
responsibility for our many programs from the Department of 
Defense (DOD) to the Department of State (DOS), including 
training of the Iraqi police. To carry out these 
responsibilities, the U.S. embassy in Baghdad anticipates that 
it will have some 15,000 to 20,000 personnel under its 
authority, including at two consulates, two embassy branch 
offices, three police training centers, and five Office of 
Security Cooperation (OSC) locations. This will include 
thousands of DOS contractors to provide perimeter and movement 
security as U.S. Armed Forces depart.
    Whether this transition is successful will depend in no 
small part on whether DOS is provided the resources that it 
needs to take on and sustain those responsibilities. Congress 
will need to do its part to ensure that DOS has what it needs 
to do all that it can to help secure the hard-fought gains in 
Iraq that have come at great sacrifice of American lives and 
treasure.
    Significant security challenges remain in Iraq. Security 
incidents in 2010 were down from 2009 levels, but terrorist 
groups, including Al Qaeda in Iraq (AQI), continue to have the 
capacity to carry out high-profile attacks that kill dozens and 
wound hundreds of Iraqis.
    Iran remains a highly negative influence, providing support 
to extremist groups. Another security challenge is the 
instability arising from the unsettled situation in Kirkuk and 
the boundary dispute in the north. USF-I has worked closely 
with the Government of Iraq and Kurdish security forces to 
reduce tensions and to facilitate the integration of these 
forces.
    Our goal is to leave behind an Iraq that is stable. During 
our trip, we heard that in general the Iraq Security Forces 
(ISF) have made major progress and are capable of dealing with 
internal security threats to the Iraqi people and are leading 
those operations. However, we also heard it will be some time 
before the Iraq Security Forces can provide for Iraq's external 
defense.
    USF-I's training and advisory mission is focused on train-
the-trainer programs as the training mission is transferred to 
the Iraq MOD. USF-I continues to work with Iraq's MOD and MOI 
with the goal of building their minimum essential capabilities.
    Iraq will continue to need support in building its 
capabilities to meet internal and external threats for years to 
come. I'm concerned, however, by the latest report from the 
Special Inspector General for Iraq Reconstruction (SIGIR), 
which finds that the development of ISF is at risk from 
shortfalls in logistics capacity, corruption within the Iraq 
MOD, and the failure to plan appropriately for the maintenance 
and sustainment of infrastructure and equipment.
    The SIGIR report cites a report by the DOD Office of 
Inspector General (IG) which warns of problems with Iraq's 
development of its capability to achieve and sustain minimum 
material readiness levels for the ISF, saying that this ``could 
result in a downward spiral of operational readiness that would 
put Iraq's security and stability at risk.''
    General Austin, I'm interested in getting your professional 
military opinion on whether you agree with those assessments.
    One major question is what security relationship the United 
States and Iraq will have once the 2008 Security Agreement 
expires in December. It is unclear whether the Maliki 
Government will seek any type of continuing U.S. presence after 
December, given the terms of the Security Agreement that 
provides that all of our troops will be removed by this 
December. Iraq needs to engage with the United States sooner 
rather than later if such a request is going to be forthcoming.
    The Government of Iraq needs to understand that the days of 
American taxpayers bearing the costs of developing ISF are 
ending. Iraq has significant oil revenue which will continue to 
increase. According to the latest quarterly report from the 
SIGIR, Iraq's efforts to attract foreign investment ``continue 
to bear fruit,'' in their words, and the development of Iraq's 
oil fields is making ``better than expected progress.''
    We should work with the Government of Iraq to make 
available the equipment and training it needs for its long-term 
security, but Iraq should not expect American taxpayers to bear 
the costs of its security needs.
    Finally, an important issue for the Government of Iraq 
remains the security of Christians and other religious 
minorities. During our visit, we met with leaders of Christian 
communities, which have suffered from suicide attacks, targeted 
killings, kidnappings, and other intimidation by violent 
extremist forces. These communities live in fear and a large 
number of Christians have either fled the country or uprooted 
to safer regions in northern Iraq.
    The leaders we met, explained with pride, how Iraq has been 
home to some of the earliest Christian communities and Iraqi 
Christians do not want to leave their country in order to feel 
safe and Iraq had a long tradition of religious tolerance. On 
our visit we urged the Government of Iraq to act with great 
urgency to provide the security necessary to preserve and 
protect these ancient Christians and other religious minority 
communities.
    Ambassador Jeffrey and General Austin, we know from our 
conversations in Iraq and here that you will continue to keep 
the safety of the various religious minority communities in 
Iraq as one of your top priorities in your discussions with the 
Government of Iraq.
    We look forward to hearing from our witnesses this morning 
and again thank you both for your service, as well as those 
with whom you serve.
    Senator McCain.

                STATEMENT OF SENATOR JOHN McCAIN

    Senator McCain. Thank you, Mr. Chairman. Let me also join 
you in taking this opportunity to welcome the six new members 
of our committee. I'm confident that the work of this body will 
be enriched and enhanced by their contributions and I join you 
in stating that our work has been bipartisan and it's been an 
honor for me to serve with you as ranking chairman of this 
committee. Our bipartisanship is not devoid of passion when we 
occasionally disagree on an issue.
    I want to thank our distinguished witnesses for joining us 
today. I have had the honor of knowing Ambassador Jeffrey and 
General Austin for many years, two great servants of our 
country, and on behalf of this committee we thank you for your 
service. Please convey to the brave men and women you lead, 
both military and civilian, the deep gratitude for their 
service that is felt by the American people and their 
representatives.
    I'm very happy to have the chance today to focus on Iraq. 
It would have been unthinkable even 2 years ago to say that we 
would reach a point which most Americans, indeed some people in 
Washington, would increasingly forget about Iraq. But that 
point has largely come and, as much as it reflects the 
dividends of success, especially the success of the surge, we 
disregard Iraq at great peril.
    It's certainly true that many of the critical indicators in 
Iraq are encouraging. AQI remains significantly weakened. 
Despite many horrific large-scale attacks, especially against 
Iraq's Christian communities, overall levels of violence have 
been relatively low and steady compared to recent years. Iraq 
is increasingly bringing its vast oil and gas resources on 
line.
    The country had a successful democratic election last year 
and, despite a painfully drawn-out period of political 
wrangling, a new government is now mostly formed in Baghdad. As 
demonstrations take place for democracy across the Middle East, 
I don't think you'll see those kinds of demonstrations in Iraq 
because the Iraqi people did have a chance to express their 
political will.
    Yet, despite Iraq's progress, there remain serious 
questions about whether it will endure and what role our Nation 
can play and should play as Iraq's partner to reinforce 
success. The fact is 2011 will be one of the most consequential 
years for Iraq and for our partnership, a year that will 
largely shape whether the country continues to emerge as an 
increasingly secure, self-sustaining democratic partner of the 
United States or tragically stumbles, sliding back into civil 
conflict, anarchic violence, and authoritarian rule.
    These choices will ultimately be made by Iraqis. Make no 
mistake, after sacrificing hundreds of billions of American 
taxpayers' dollars and nearly 4,500 American lives, the United 
States has an enormous stake in Iraq's success. We have 
enduring national interests relating to Iraq that must be 
defended. We still maintain a significant capacity to influence 
events for better or for worse. If, God forbid, Iraq's progress 
should unravel and the moment of opportunity is squandered, no 
one should think that the American people will be forgiving in 
holding their leaders accountable for that failure.
    The Security Agreement signed by the Bush administration 
and affirmed by the current administration states that all U.S. 
troops will leave Iraq by the end of this year. This means 
we're approaching a decisive transition, and I'll be blunt. I 
have real concerns about whether the proposed civilian-led 
mission will take the lead once our troops are gone and is 
sufficient to support the Iraqi needs and U.S. interests, not 
because our civilians are not capable professionals, they most 
certainly are, but because of the huge and unprecedented 
challenges they face.
    In short, we are asking DOS to take on the mission of the 
U.S. military at a scale never contemplated before, amid still-
fragile security conditions. Many of the tasks now performed by 
U.S. troops will transition, at great cost, to civilians and 
contractors. Some such tasks will cease to be performed at all. 
Many relationships with key Iraqi leaders across the country 
will be hard to maintain for security reasons and vital 
military-led programs, from intelligence fusion to the 
peacekeeping activities performed along the still tense Arab-
Kurdish boundaries, will be massively scaled back or 
effectively ended.
    No one should interpret my comments today as a lack of 
support for Iraq and the continued U.S. involvement there. To 
the contrary, failure is not an option in Iraq and we must be 
prepared to bear the cost to ensure success, including the cost 
of our civilian operations and development programs, and which 
will be substantial however this transition plays out. Congress 
cannot shortchange this mission now.
    What we need, however, is a more forward-looking strategy. 
The new Iraq administration will govern the country for the 
next 4 years. What does it need to accomplish by the end of 
that time to set Iraq further down a path of lasting success? 
How can our two governments align our resources in a common 
plan that consistently advances our shared goal, the emergence 
of an Iraq that can secure itself, govern itself, generate its 
own wealth, and sustain its own development with less and less 
U.S. assistance.
    Then, having established the optimal ends we seek as well 
as the U.S. presence and programs required to achieve them, how 
can we build the bipartisan support in Congress to sustain a 
robust commitment to Iraq, especially a commitment for what 
will increasingly be a civilian-led mission?
    These are questions worth considering today and in the 
months ahead and I look forward to discussing all these issues 
today with our witnesses.
    I also would like to point out that there is a place in 
Iraq that is inhabited by Iranian refugees called Camp Ashraf, 
and it has been under the protection of American troops. I am 
concerned about the welfare, wellbeing, and security of these 
people. I hope that we can address this issue in a way that 
would reassure them of America's and Iraq's commitment to their 
security.
    I thank you, Mr. Chairman.
    Chairman Levin. Thank you very much, Senator McCain. We 
also share your concern about Camp Ashraf.
    By agreement to your suggestion, we are going to call on 
General Austin here first. Ambassador Jeffrey will follow.
    General Austin.

  STATEMENT OF GEN LLOYD J. AUSTIN III, USA, COMMANDER, U.S. 
                          FORCES-IRAQ

    General Austin. Chairman Levin, Senator McCain, 
distinguished members of SASC, thank you for the opportunity to 
testify with Ambassador Jeffrey this morning. I am indeed 
fortunate to be partnered with Ambassador Jeffrey in one of the 
most professional diplomatic teams that I've ever seen.
    I'd also like to thank you for your support to our men and 
women in uniform serving in Iraq and their families here at 
home. I'd like to spend a few minutes to give you my assessment 
on the current security environment and the capabilities of the 
ISF and outline what USF-I is focused on for the remainder of 
the year.
    The security environment in Iraq has been steadily 
improving over the past few years, most notably during the 
delay in government from March to December 2010. It was very 
encouraging to us that while Iraq was being served by a 
caretaker government the ISF remained apolitical and performed 
admirably. They provided the Iraqi leaders with the time and 
the space that was necessary for peaceful dialogue and 
compromise to occur.
    The commendable work on the part of the ISF is paying off. 
Today Iraq has the most inclusive government in her nation's 
history and the security environment is the best it has been 
since 2003. Security incidents in 2010 were 25 percent lower 
than those in the previous year, and that trend has continued 
following government formation.
    The security environment continues to improve, but it will 
remain complex and the threats to Iraq's stability will remain 
in 2012. Sunni extremist groups, like al Qaeda, will continue 
to target the Government of Iraq, the ISF, and Iraqi civilians 
in order to garner media attention and to attempt to 
demonstrate that the government cannot provide security for the 
Iraqi people. Shia extremist groups likewise will continue to 
target U.S. personnel and, in our absence, the Iraqi Government 
and its institutions.
    While the ISF have a good capability to confront Sunni and 
Shia extremist groups and provide for internal security, they 
will have gaps in their external defense capabilities in 2012. 
Iraq will not be able to defend its air sovereignty for some 
time. They will also require continued development on 
capabilities such as logistics, sustainment, intelligence, and 
more complex training.
    The ISF will continue to develop their capabilities, which 
will require them to continue receiving modern equipment, 
conduct training on that equipment, and then conduct unit-level 
training. USF-I and the ISF have just recently begun a 
collective training initiative which allows entire battalions 
to go through an intensive training cycle. This program 
provides the Iraqi army with the foundational collective 
training necessary for their units to operate and has been made 
possible by the much improved security environment. This 
training is a great step forward towards improving their 
proficiency, but they will still require much more 
comprehensive combined arms training and joint training in 
order to develop an external defense capability.
    With the time that we have remaining, USF-I will continue 
to advise, train, assist, and equip the ISF to narrow some of 
these capability gaps. We will also work closely with the U.S. 
Embassy-Iraq as we transition from a predominantly military-led 
to a civilian-led effort in Iraq.
    We are dedicated to partnering with our embassy teammates 
in preparing for this important transition. The key to a 
successful transition is the need to fully resource the embassy 
to perform their task and responsibilities. We're developing 
the OSC, which will fall under the embassy, and the OSC will 
provide oversight over all security cooperation in Iraq and it 
will assume responsibility for the near-$13 billion worth of 
Foreign Military Sales (FMS) programs that we currently have 
with the Iraqis. It will also coordinate International Military 
Education and Training. This office will work hard and be 
dedicated to closing any capability gaps within the ISF.
    Clearly, there is much work to do, but I am encouraged by 
the progress that Iraq has made over the last few years and I'm 
confident that Iraq can achieve its full potential if it stays 
on the path that it's currently on.
    I'd like to close my remarks by recognizing the great men 
and women that are serving in Iraq and their families who are 
supporting them. While our soldiers, sailors, airmen, marines, 
coastguardsmen, and civilians are serving overseas, our 
families are serving here at home, and certainly we would not 
be where we are today without the sacrifices of so many, and 
without the unwavering support from here at home.
    Mr. Chairman, members of the SASC, thank you once again for 
this opportunity to appear this morning with Ambassador 
Jeffrey, and I stand ready to answer any questions that you may 
have.
    Chairman Levin. Thank you so much, General Austin.
    Ambassador Jeffrey.

  STATEMENT OF HON. JAMES F. JEFFREY, U.S. AMBASSADOR TO IRAQ

    Ambassador Jeffrey. Chairman Levin, Ranking Member McCain, 
Senators: Let me join with General Austin in thanking you for 
holding this hearing and inviting us to appear before you to 
discuss the issues associated with the United States transition 
from a military-led to a civilian-led presence in Iraq.
    We face a critical moment now in Iraq, where we'll either 
step up to the plate, finish the job, and build upon the 
sacrifices made or we will risk core U.S. national security 
interests, be penny-wise and a pound-foolish, and cede the 
field to al Qaeda and to other dangerous regional influences. 
We have thus, an historic opportunity and a critical window to 
help Iraq emerge as a strategic partner and a force for 
stability and moderation in a troubled region. We cannot afford 
to let the gains we have sacrificed so much for slip away.
    The President has clearly articulated our vision for 
partnership with Iraq. We seek an Iraq that is sovereign, 
stable, and self-reliant, with a government that is just, 
representative, accountable, that denies support and safe haven 
to terrorists, is able to assume its rightful place in the 
community of nations, and contributes to the peace and security 
of the region.
    The U.S. military have performed admirably, but they cannot 
stay in Iraq forever. DOS is ready to take the lead, but we 
need the support and resources to finish the job. We need to 
have platforms to carry out key transitional missions for the 
next 3 to 5 years. These include work throughout the country, 
especially in key areas such as Kirkuk and Mosul, where past 
experience has shown how a small number of Americans can have a 
great, disproportionate impact in helping to defuse crises and 
produce long-term solutions.
    Our missions also include helping the Iraqis to 
professionalize their police, an absolutely critical component 
to the country's long-term stability, as General Austin said, 
to provide security assistance to help the Iraqis finish the 
job against al Qaeda and other terrorist groups, and to develop 
a core conventional defense capability. To not finish the job 
now creates substantial risks of what some people call a 
``Charlie Wilson's War moment,'' with both the resurgence of al 
Qaeda and the empowering of problematic regional players.
    Al Qaeda is still capable of devastating attacks that 
threaten Iraq and beyond. Furthermore, gutting our presence in 
Iraq would also provide Iran increased ability to create 
anxieties in the region that could spiral out of control.
    Along with the Iraqis, the United States has paid a dear 
price in this war: over 4,300 deaths, over 3,300 wounded among 
our military forces and hundreds of embassy casualties as well. 
As Vice President Biden stated during his recent visit, ``It is 
vital that we leave behind an Iraq that is worthy of the 
sacrifices that so many U.S. troops and civilians have made.''
    While all U.S. Government work in Iraq is expensive due to 
the security situation, a robust civilian presence represents a 
significant reduction in expenditures. Between 2010 and 2011, 
for example, the U.S. military withdrawal reduced the bill for 
taxpayers by about $15 billion, while the increase in DOS's 
budget was just $2.5 billion. While DOS's 2012 funding needs 
will naturally increase because of the military-to-civilian 
transition, the overall U.S. cost will continue to decrease 
dramatically.
    Moreover, U.S. development assistance to Iraq is not open-
ended. Iraq has vast untapped oil resources, but, due to the 
devastated oil infrastructure, it will be a number of years 
before Iraq will have meaningful new oil revenue for its own 
budget.
    Performing the military-to-civilian transition in Iraq also 
will demonstrate, more generally, that we can transition 
security successes in war zones into long-term stability, 
including for Afghanistan.
    In closing, I would like to thank DOD, U.S. Central Command 
(CENTCOM), and above all General Austin and his troops for the 
support that they are giving us in this mission. I would also 
like to express my admiration and humility in the face of the 
commitment and sacrifice we see every day in Iraq on the part 
of our civilian staffs, military members, and our Iraqi 
partners as they risk their lives for a cause which they 
believe in, the Iraq I have just finished describing.
    I thank you again for the opportunity to appear before you 
today. We will be happy to answer any questions the committee 
may have and look forward to working hand in hand with you and 
other Congressional colleagues.
    Mr. Chairman, at this time, we'd like to submit our joint 
written statement for the record.
    Chairman Levin. It will be made part of the record.
    [The joint prepared statement of Ambassador Jeffrey and 
General Austin follows:]
 Joint Prepared Statement by Ambassador James F. Jeffrey and GEN Lloyd 
                             J. Austin, USA
               why iraq is important to the united states
    A stable Iraq will play a critical role in achieving U.S. foreign 
policy objectives in the Middle East for the foreseeable future. Iraq's 
strategic importance is based on a number of factors. Iraq plays a 
central role in the Arab and Muslim worlds and hosts Shi'a Islam's 
holiest sites. Iraq has a diverse, multi-sectarian and multi-ethnic 
population. Geographically, Iraq is strategically positioned between 
major regional players, including Jordan, Kuwait, Saudi Arabia, Turkey, 
Iran, and Syria. Iraq represents the frontier between the Arab and 
Persian worlds. Because it is endowed with a significant portion of the 
world's oil reserves, Iraq will play an increasingly influential role 
in the global economy. We must remember that for most of its modern 
history, Iraq has been aligned with our adversaries, a threat to our 
friends and interests, and a destabilizing force in the region and 
world.
    We now face an historic opportunity--and a critical window--to help 
Iraq emerge as a strategic partner and a force for stability and 
moderation in a troubled region. An enduring Iraqi-U.S. partnership 
will be critical in enabling Iraq to be that positive force. It is in 
our national interest to fully support that partnership. We cannot 
afford to let the gains we have sacrificed so much for slip away before 
they are cemented.
U.S. Interests
    The United States has important national interests in the greater 
Middle East. These include the unity and security of Iraq as well as 
continued development of its democratic institutions and its 
reintegration into the region. U.S. national interests related to Iraq 
are: regional nonproliferation; counterterrorism cooperation; access to 
energy; and integration of the region into global markets.
                         administration policy
    U.S. policy is set by President Obama's 2009 speech at Camp 
Lejeune, which reaffirmed the 2008 Security Agreement, calling for the 
withdrawal of U.S. forces by December 31, 2011, and the 2008 Strategic 
Framework Agreement, which lays out a long-term strategic relationship 
between the United States and Iraq in the fields of diplomacy, 
economics, energy, security, and rule of law. The goal of the 
President's policy is to promote security and prosperity in Iraq, 
transition responsibility for security to the Iraqis, and cultivate an 
enduring strategic relationship with Iraq based on mutual interests and 
mutual respect.
    In so doing we seek an Iraq, as described in the Camp Lejeune 
speech and the May 2010 National Security Strategy, that is sovereign, 
stable, and self-reliant; with a government that is just, 
representative, and accountable; that denies support and safe haven to 
terrorists; is able to assume its rightful place in the community of 
nations; and contributes to the peace and security of the region. 
Consistent with this policy, President Obama announced the end of 
Operation Iraqi Freedom and combat operations in Iraq on August 31, 
2010. Prior to the end of combat operations, the administration 
withdrew nearly 100,000 troops, closed or transferred to the Iraqis 
hundred of bases, and moved millions of pieces of equipment out of 
Iraq. These actions marked a key transition as Iraqis assumed 
responsibility for their own security. The transitional force of less 
than 50,000 U.S. troops that remains has a new mission to advise, 
train, assist, and equip the Iraqi Security Forces (ISF), protect our 
personnel and property, and participate in counterterrorism operations. 
As the military draws down, civilians--diplomats, aid workers, and 
advisors--are moving into a more prominent role to support Iraq in 
achieving its political, economic, security, and diplomatic goals. Our 
success in Iraq will require continuing the strongest possible U.S. 
military and civilian cooperation on the ground during the drawdown.
           current security situation and a look towards 2012
    Despite some predictions to the contrary, security in Iraq improved 
during the 9-month delay in government formation. Security incidents in 
2010 were 25 percent lower than 2009 due, in large part, to the 
credible performance of the ISF. They were instrumental in creating the 
space necessary for peaceful dialogue.
    That said, there is still much work to be done. 2011 will be a 
critical, challenging year--one that sets the conditions for Iraq's 
continued progress. Security trends are good but the environment is 
complex. Iraq still faces dangerous and determined enemies, each with 
their own objectives and tactics.
    Al Qaeda in Iraq (AQI) is degraded but determined. Recent attacks 
targeting Christians, including a horrific attack October 31 against 
Our Lady of Salvation Church, as well as against Shia pilgrims during 
the observation of Arba'een demonstrate AQI's capability to conduct 
high casualty-producing attacks. However, the window of time between 
AQI attacks has widened while the level of sophistication of their 
attacks has declined. This degradation in capability is largely due to 
the efforts of Iraqi and U.S. Special Operations Forces, working 
together to maintain constant pressure on extremist networks. 
Additionally, restricting financing and command and control capability 
greatly limits AQI's ability to conduct signature attacks. While they 
remain determined, they will not achieve their aim of inciting 
sectarian conflict--the Iraqi people continue to stand together and 
reject AQI principles.
    While AQI remains Iraq's most dangerous enemy, Shia extremist 
groups continue to be a serious threat. Groups such as Kataib 
Hezbollah, Asaib al-Haq, and the Promised Day Brigade have indicated 
their intention to increase violence against U.S. forces and they 
continue in their attempts to do just that. While they may focus on 
U.S. forces now, we believe they will likely target the Government of 
Iraq after U.S. forces depart.
    We assess Iraq's security environment will be relatively stable in 
January 2012 due to a number of factors. AQI will remain capable of 
signature attacks but will lack public support. The Sunni insurgency 
will continue to present a low-level threat. Shi'a extremists will 
continue to be funded, trained, and equipped by Iran. Violence will be 
masked by criminality, illicit smuggling, and extortion--a blend of 
extremism and crime. The ISF will be increasingly capable of providing 
internal security, but will not be capable of providing for external 
defense. The Army will not be capable of conducting combined arms 
operations due to incomplete fielding of modern equipment that will 
still be arriving as U.S. forces depart. The Navy will have limited 
capability to defend territorial waters and the Air Force will lack the 
capability to maintain air sovereignty. Police will be unable to assume 
full responsibility for internal security in many regions due to 
lagging development of capabilities and professionalism, further 
hampered by poorly defined relationships between the Ministry of 
Defense (MOD) and Ministry of Interior (MOI).
                       iraq security forces gaps
    For the United States to achieve its goals, the Government of Iraq 
must provide for Iraq's internal security, develop external defense 
capabilities, and lead and manage its institutions. As Iraq emerges 
from an extended government formation process, inter-ministerial 
conflict, ethno-sectarian tensions, and malign Iranian influence will 
continue to serve as barriers to progress. While U.S. operations 
through 2011 will address many of these issues, gaps in capabilities 
will remain. These gaps include:

         Counterterrorism operations and intelligence fusion.
         Cross-ministerial and interagency intelligence fusion 
        and information sharing.
         Sustainment and logistics.
         Combined arms (external defense)
         Air sovereignty/air defense.
                       five ``ms'' of transition
    At the national strategic level, the transition to a civilianized 
post-2011 relationship under the Strategic Framework Agreement involves 
a number of key factors, what we call ``the five Ms.'' These are: new 
Missions, Money and other resources, coordination with Prime Minister 
Maliki's government, Months left to complete the job, and Management of 
the whole process. Let us cover each of the ``Ms'' in more detail.
(1) The New Missions
    The National Security Strategy lays out specific tasks the embassy 
will have to assume from United States Forces-Iraq (USF-I). These 
include:
    Broader Diplomatic Presence
    2011 will see a huge drop in U.S. presence in Iraq as almost 50,000 
troops and many tens of thousands of Department of Defense (DOD) 
contractors depart. USF-I and the 16 diplomatic Provincial 
Reconstruction Teams (PRTs) we have now are carrying out extraordinary 
security, political outreach, training, economic, and developmental 
assistance programs, and giving the embassy, USF-I headquarters, and 
Washington situational awareness over the breadth of Iraq. This 
presence has been instrumental in aiding Iraq in achieving not only its 
security, but also remarkable political and economic progress. But we 
need a temporary civilian-led presence in these areas for a few years 
to further build on what our military and PRTs have done, to diffuse 
crises, and produce long-term solutions. To this end, civilian 
engagement with Iraq's provinces, currently led by PRTs, will 
consolidate into four strategically-located diplomatic outposts. The 
Department of State (DOS) will soon inaugurate two consulates--in Erbil 
and Basra--and two embassy branch offices--in Mosul and Kirkuk--as well 
as utilize the Office of Security Cooperation in Iraq (OSC-I) offices 
and police training hubs as secure platforms for assistance throughout 
Iraq.
    Development Assistance
    Aside from general political engagement and situational awareness, 
U.S. Government assistance through these platforms and the U.S. Agency 
for International Development (USAID) programs will emphasize 
strengthened provincial governance, community and civil society 
participation, economic reforms to expand the private sector economy, 
respect for the rule of law and human rights, improved delivery of key 
social services, preparations for future elections, and the continued 
return and resettlement of displaced persons. USAID development 
programs assist Iraqis to use their own human and natural resources 
more effectively and sustainably and coincide with U.S. Government and 
Iraqi prerogatives laid out in the Strategic Framework Agreement as 
well as the Iraqi Government's stated priorities in its own National 
Development Plan.
    Modernization of Iraqi Security Forces
    As noted above, the ISF are not ready to independently provide for 
Iraq's defense despite their impressive performance thus far. They need 
continued U.S. support. U.S. Embassy Baghdad will continue the efforts 
of USF-I to develop the ISF, now more than 650,000 strong, through 
Security and Defense Cooperation and Security Assistance activities 
under the OSC-I. This mission will include advising, training, and 
equipping Iraqi forces, supporting professional military education, and 
planning joint military training exercises. It will allow for continued 
fulfillment of 336 cases of Foreign Military Sales (FMS) (valued at $8 
billion) and ensure the delivery of M1A1 tanks, patrol boats, 
howitzers, armored personnel carriers, and more. The OSC-I will also 
enable the delivery of an additional 61 cases of FMS (valued at $5 
billion) already requested by the Government of Iraq. It is projected 
to have a full-time staff of 157 military and civilian personnel as 
well as hundreds of case-related specialists for FMS at any one time.
    We believe the OSC-I is important to a successful Iraq transition. 
DOD and DOS will work with Congress on requested resources and 
authorities needed in order to support the OSC-I.
    Police Development Program
    We need to help the Iraqis to professionalize their police, an 
absolutely critical component to the country's long-term stability. The 
U.S. Embassy in Baghdad and the DOS's Bureau of International Narcotics 
and Law Enforcement Affairs will oversee a continuing U.S. Government 
effort to enhance the professionalism of the Iraqi police force through 
advanced mentoring at the ministerial and provincial level and through 
specialized training. The transition to a civilian-led partnership with 
the Iraqi MOI will be a central element of the U.S. support to ISF. 
This partnership will include 190 advisors at 28 advisory locations in 
10 provinces, eventually reaching approximately 55 percent of the 
roughly 287,000 police assigned to the Iraqi Police Service and focused 
on population centers representing more than 65 percent of the Iraqi 
population. The goal will be to facilitate a professional, competent, 
and self-sufficient MOI that provides security and stability to its 
citizens and is able to effectively counter terrorism and organized 
crime within 5 years.
    Information-Sharing
    Counterterrorism cooperation is the primary focus of our 
information-sharing mission. Current information exchange programs in 
Baghdad will continue, with limited information exchange--including 
tactical data--at consulates and branch offices. U.S. Embassy Baghdad 
will also maintain operations and information liaison at various 
headquarters, operation centers, and intelligence fusion cells in four 
major cities in Iraq.
    Logistics
    To support various missions and operating locations in an austere 
and non-permissive environment, U.S. Embassy Baghdad must take on many 
logistical functions that USF-I currently provides for its forces, 
PRTs, and the embassy. These include securing sites outside of Baghdad 
and providing personal security details, administering the DOD 
Logistics Civil Augmentation Program's life support contract for all 
U.S. personnel in Iraq, managing the supply lines for food, fuel and 
material, operating emergency medical facilities, and running in-
country and regional air operations.
(2) Money and Other Resources
    If DOS is to effectively take the lead from our military 
colleagues, we need the support and resources to finish the job. As 
Vice President Biden said on November 20, 2010: While the day will come 
when Iraq's vast natural wealth can fully finance its security and 
investment needs, and when its civilian institutions no longer require 
such intensive support, it has not yet arrived. Iraq has increased its 
own spending in these areas, and with sustained American engagement, it 
will emerge from generations of trauma to become a stable and self-
reliant nation. That is why, even at this difficult economic time, we 
are asking Congress to fulfill our budget requests to support America's 
continued engagement, including our broader diplomatic presence, 
modernization plan for the Iraqi security forces and financing for a 
police development program. While all U.S. Government work is expensive 
in Iraq due to the security situation, a robust civilian presence 
represents a significant savings for the taxpayers from the bills they 
have been paying for the past 8 years. Given all the United States has 
sacrificed in Iraq, now is not the time to be pennywise and pound-
foolish and risk ceding the field to al Qaeda and Iran. One of the hard 
lessons from America's past experience in Afghanistan right after the 
Cold War is the necessity of supporting and influencing the transition 
of war-torn nations from conflict to stability to peace and prosperity.
(3) Months to January 2012
    We have a limited time to successfully implement this transition. 
DOS will have to take over the above mentioned missions, deploy many 
thousands of additional personnel, and expend significant funds to 
build out various sites, all within less than a year.
(4) Coordination with Prime Minister Maliki's Government
    The cooperation of the Government of Iraq is essential to achieving 
the new missions above in the time allotted. Specifically, we are 
asking that the Government of Iraq finalize Land Use Agreements, 
provide security support with ISF to U.S. diplomatic establishments and 
activities, and allow for the continuity of current security, aviation, 
and ground movement operations now provided by USF-I.
(5) Management
    The U.S. Government must execute this entire program, from budget 
execution through personnel deployments, site construction, and 
transfer of missions. The greatest asset of the operation, and of the 
embassy in Baghdad, has been the extraordinary support provided by USF-
I, U.S. Central Command, and DOD. This support, and the closest 
possible civilian-military cooperation during and after the transition, 
is vital to our success.
                               conclusion
    To quote the President in his address on the end of combat 
operations in Iraq on August 31, 2010: The Americans who have served in 
Iraq completed every mission they were given. They defeated a regime 
that had terrorized its people. Together with Iraqis and coalition 
partners who made huge sacrifices of their own, our troops fought block 
by block to help Iraq seize the chance for a better future. They 
shifted tactics to protect the Iraqi people, trained Iraqi Security 
Forces, and took out terrorist leaders. Because of our troops and 
civilians--and because of the resilience of the Iraqi people--Iraq has 
the opportunity to embrace a new destiny, even though many challenges 
remain.
    Our overarching goal in this transition is to build a viable 
partnership that will flourish into the future well after our troops 
have departed, and to honor the many thousands of Iraqis and Americans 
who have given their lives for a greater cause--a cause that embraces 
all of us here as we endure to leave behind an Iraq that is worthy of 
their sacrifice.

    Chairman Levin. Senators Portman and Ayotte are with us. We 
welcomed you before very warmly and we repeat that welcome. 
We're delighted that you're with the committee, as are other 
new members on the Democratic side.
    Senator Ayotte. Thank you, Mr. Chairman.
    Chairman Levin. We welcome your statement, Ambassador, as 
to what the goals of the Obama administration are in Iraq, and 
maybe most of us share that goal. You talked about stability, 
security, and self-reliance of an Iraqi state and an Iraqi 
Government, and that is and has been the goal.
    One of the threats to that success, that achievement of 
that goal, to the stability, and security of Iraq, is the 
failure of the political leaders of Iraq to reach conclusions 
on some critical issues. This has always been a problem. We've 
always expressed the importance of the political leaders coming 
together.
    Some of the current political issues that are unresolved 
include the following: An agreement to create a National 
Council for Higher Policies with real executive power, headed 
by former Prime Minister Allawi. There's an agreement that such 
a council be created, but there's no agreement yet on what the 
powers of that council will be.
    The positions of the Iraq MOD, MOI, and National Security 
are still unfilled. There is no agreement yet on oil policies, 
specifically the division of oil revenues. These are huge 
issues that remain unresolved and I believe threaten the goals 
and objectives that we have and, hopefully, the Iraqis have for 
themselves.
    Can you comment on this matter? Is it important that the 
leaders of Iraq get on with the decisions in those areas, 
Ambassador?
    Ambassador Jeffrey. Thank you, Mr. Chairman.
    Chairman Levin. We're going to have a 7-minute round, by 
the way; I usually announce how long the round of questions 
will be.
    Ambassador Jeffrey. It is vitally important that they 
finish the job of forming the government. They've taken most of 
the steps necessary, but you have outlined several of the 
remaining issues that we've been pressing them on and more 
importantly, they've been pressing themselves on. We have seen 
some progress in the last several weeks on the National Council 
and the two sides have basically agreed to everything but the 
modality of how to select Dr. Ayad Allawi. Everybody agrees 
that he should be selected.
    We think that this should be resolved in the next few days. 
I was in contact with President Barzani of the Kurdistan 
Regional Government this morning and the embassy with other 
people, trying to take the temperature of where we are on these 
steps. There are also some names that are floating on 
compromise candidates for both of those ministries that I 
mentioned. Again, we are encouraged by what we've heard over 
the past several days, but the proof is in the pudding and we 
have to see if they will finish the job. It is very important 
that they finish the job and get on with the business of 
government.
    On the oil account, two positive developments. As with 
everything else in Iraq, it moves forward in relatively small 
steps, Senator, but it does move forward. The Kurds and the 
other coalition parties agreed on a 19-point plan, or on most 
of the 19-point plan, that includes giving priority to a 
hydrocarbons law and a revenue-sharing law. This is vital.
    Meanwhile the central government, Prime Minister Maliki 
personally, and the Kurdistan Regional Government have agreed 
on an interim step of allowing up to 150,000 barrels of oil 
from the Kurdistan Regional Government to flow out through the 
Turkish pipeline. This is a very significant development and it 
gives us hope that they will continue down that path, sir.
    Chairman Levin. Thank you.
    General Austin, is the withdrawal of our forces by the end 
of this year, as agreed to by President Bush and Prime Minister 
Maliki, on track?
    General Austin. Thank you, Senator. It is indeed on track. 
We just recently completed our planning process that will 
govern the rest, the remainder of our activities from now until 
the end of December. We've issued Operations Order 11-01, which 
prescribes the major activities that will be conducted, focused 
on strengthening the ISF, reposturing our forces, and also 
transitioning responsibilities to the embassy, the Government 
of Iraq, and CENTCOM.
    We continue to synchronize that plan and we're also 
synchronizing the activities of the embassy along with our 
activities as we go about executing the plan.
    Chairman Levin. Thank you.
    Is there any indication, I'll ask this of both of you, that 
Iraq is going to request that any elements of our military 
forces remain beyond December?
    Ambassador Jeffrey. We have received no such request, 
Senator. We are working with the Iraqis, as the General said, 
on the security elements of our post-2011 presence, which will 
include a large OSC-I element for security cooperation and the 
police training, which will be a major program. Both of these 
are under the framework of the Strategic Framework Agreement, 
which was the second agreement signed in 2008. It does not have 
a deadline and it calls for a broad cooperation across the 
spectrum of bilateral relations including, specifically, 
security.
    We're working with the Iraqis now on exactly what the 
components of that would be, sir.
    Chairman Levin. Do you expect any requests beyond that from 
the Iraqi Government?
    Ambassador Jeffrey. We haven't yet, sir, and I can't say 
what they'll say in the future.
    Chairman Levin. We don't have any indication that such a 
request is going to be forthcoming as of this time?
    Ambassador Jeffrey. As of this time, there's no specific 
request on the table, and they will want to see how we will 
meet their training and equipping needs with the program that 
we set up.
    General Austin. Senator, I echo the Ambassador's comments. 
We haven't received any request. Again, I think he covered the 
entire gamut there, so I would not add anything to that.
    Chairman Levin. Another threat to the stability, security, 
and the self-reliance of Iraq is Iran. Can you tell us, 
Ambassador, in your view, whether or not Iranian behavior in 
Iraq represents a threat to their stability and to their 
successful transition to their own complete sovereignty? What 
also is the susceptibility of the Government of Iraq to Iranian 
influence or to their destabilizing efforts?
    Ambassador Jeffrey. Senator, as the President has said many 
times, we are concerned with Iranian behavior in the region and 
in pursuit of nuclear weapons.
    Chairman Levin. Does that include in Iraq?
    Ambassador Jeffrey. In Iraq specifically, sir, we, first of 
all, have to note that as a neighbor of Iraq's, a country that 
suffered devastating losses from an invasion by Iraq in 1980, 
Iran obviously has legitimate interests in Iraq. Just like 
Turkey, Jordan, Kuwait, and Saudi Arabia do. There is 
significant trade in the region. There is a tremendous amount 
of religious pilgrimage and the like into Iraq.
    Nonetheless, what concerns us about Iran and Iraq begins 
with the support, that we have seen over the years, of armed 
militias who have attacked us and who have attacked the Iraqi 
Government. This culminated in a series of battles where Prime 
Minister Maliki took them on in 2008, in Basra, Sadr City, and 
Baghdad.
    We are watching that closely. We are seeing continued signs 
that Iran has not given up its support for these groups, and 
this is very troubling to us.
    In terms of the susceptibility of the Iraqi Government, 
like any government pays attention to its important neighbors, 
we are absolutely convinced that this is a government that is 
nationalist in orientation, is fully aware of the threats to 
its sovereignty, and will take the necessary steps to protect 
it.
    Chairman Levin. Just to complete that, they may be 
concerned about their neighbors, but specifically is there a 
problem that Iran creates for Iraq with their current behavior?
    Ambassador Jeffrey. Iraq has to face many pressing and 
long-term problems, some of which you've described.
    Chairman Levin. Is one of those Iranian behavior?
    Ambassador Jeffrey. It's not on the short list at this time 
for the Iraqi Government, but they are well aware of the 
potential for trouble.
    Chairman Levin. Is it on the long list?
    Ambassador Jeffrey. They're well aware of the potential for 
trouble, Senator.
    Chairman Levin. Thank you very much.
    Senator Gillibrand, you are welcome here. We're delighted 
that you are here. When we welcomed the new members before I 
don't believe that you were present, so it's great to have you 
here.
    Senator McCain.
    Senator McCain. Thank you, Mr. Chairman.
    As is well known, I'm deeply concerned about this issue of 
complete U.S. withdrawal. General Austin, I think that we would 
agree that the Battle of Fallujah was one kind of 
counterinsurgency that could even be compared to the Battle of 
Hue. It was house-to-house, high casualty, and a high intensity 
conflict. We fast forward to the Battle of Sadr City, which 
made extensive use of technological capabilities that we've 
developed over the intervening time.
    In the absence of the United States, would the Iraqis have 
the capability that was vital in winning the Battle of Sadr 
City?
    General Austin. Senator, certainly not. They would have to 
develop that type of capability over time. The capability that 
I believe you're referring to is the capability to acquire 
targets and employ precision fires that limit collateral 
damage.
    Senator McCain. In the words of General Petraeus, ``We made 
them take a knee,'' right?
    General Austin. Absolutely, Senator.
    Senator McCain. Without the U.S. presence there, it would 
take a long time before Iraq would have the ability to 
replicate that capability?
    General Austin. It will take some time for them to develop 
that.
    Senator McCain. The Iraqis are interested in having an air 
force, for obvious reasons. Are they going to be able to build 
an air force without U.S. presence there?
    General Austin. They do have a number of options to both 
acquire equipment from and ask for training from other nations.
    Senator McCain. So they would have to acquire equipment and 
then get trainers from other nations?
    General Austin. They would.
    Senator McCain. Would you agree, Ambassador Jeffrey, that 
the highest priority of the Iranian government this year is to 
prevent any change to the security agreement with Iraq so as to 
ensure that no U.S. troops will remain in Iraq by January 1, 
2012?
    Ambassador Jeffrey. Senator, I can't assess with full 
accuracy Iran's intentions.
    Senator McCain. My question is, would you agree that it's 
the Iranian Government's highest priority?
    Ambassador Jeffrey. I would say that it is a significant 
priority of the Iranians to not have U.S. forces on its 
doorstep.
    Senator McCain. How concerned are you, Ambassador Jeffrey, 
about the violence against U.S. civilian officials that might 
entail or occur after our withdrawal?
    Ambassador Jeffrey. Senator, my highest priority as 
Ambassador is the security and safety of my personnel. My 
people on a given week are the subject of sometimes one, two, 
or three attacks, between indirect fire and typically 
improvised explosive devices (IED). We had an IED against one 
of our columns 2 days ago. It's a very big concern of ours. 
Nonetheless, it is a concern we have lived with since we 
started operating in Iraq in 2003.
    Senator McCain. Al Sadr resided in Iran for a period of 
time, came back, and then went back to Iran. Now I understand 
he's back again. Is that correct?
    Ambassador Jeffrey. The latest I heard was that he is back 
in Iran, sir, but it's very hard for us to keep track of his 
going back and forth.
    Senator McCain. His followers are a key element in the 
formation of the Maliki Government?
    Ambassador Jeffrey. His followers or his party played a 
role back in the October time-period when the Maliki Government 
was first forming. But at the end of the day, Senator, they 
received 660,000 votes out of more than 12 million cast. They 
have only 39 seats in the coalition, which is roughly 300 seats 
total. Their role, which is relatively minor in the government, 
reflects their voting power.
    Senator McCain. It also played a key role in the formation 
of the government. When they swung by Maliki, it then enabled 
Maliki to form the government. I'm very concerned about Al-
Sadr, his activities, his followers, and his close ties with 
Iran, the Talaban, and others. I'll just be very blunt, I'm 
deeply concerned about that.
    I'm also concerned, Ambassador Jeffrey and General Austin, 
the Government of Iraq has already released a lot of 
individuals who had been detained by the U.S. military. We hear 
reports that the prime minister has released many more as part 
of a political negotiation to form a new government, especially 
with the Sadrists. Do you have concern about that, General 
Austin?
    General Austin. Senator, I am always concerned if----
    Senator McCain. I mean, it's happening? These detainees are 
being released?
    General Austin. There are a number of detainees that are 
routinely released because of lack of evidence or because they 
may have served their sentence.
    Senator McCain. Do you believe that some of those have been 
released because of the influence of Al-Sadr?
    General Austin. I have no proof to confirm that.
    Senator McCain. Is it your opinion?
    General Austin. Without proof, I would be hesitant to 
provide an opinion on that.
    Senator McCain. In the Kurdish Iraqi areas like Mosul and 
Kirkuk there is a significant U.S. peacekeeping presence. What 
is your degree of concern about the removal of that presence as 
far as igniting some conflicts between the two parties?
    General Austin. Our presence up there has provided a means 
to build confidence and enable the Arab and Kurdish elements to 
work together there. The troops have done a magnificent job of 
working well together. In some areas, tensions still remain, 
and I think that as we remove those combined security locations 
it has to be carefully managed.
    At the end of the day, the issues that are present there 
need to be resolved politically and that may take some time.
    Senator McCain. I hope, Ambassador, you'll make some 
representations to the Iraqi Government concerning the 
situation in Camp Ashraf, and I want to thank both of you for 
your service, and may I urge you to continue to make a case for 
continued U.S. assistance as the Iraqi Government goes through 
a very difficult and challenging transition. There are enormous 
pressures for cutting spending that are going to increase here 
in Congress, and we're going to have to convince a lot of 
people of the importance of sustaining and assisting a free and 
independent Iraq as it makes this transition.
    I thank you for your service to the country.
    Thank you, Mr. Chairman.
    Chairman Levin. Thank you, Senator McCain.
    Senator Reed.
    Senator Reed. Thank you very much, Mr. Chairman.
    Thank you, gentlemen, for your service and for the service 
of your colleagues. As Senator Levin indicated, we were there 
just a few days ago to witness firsthand the progress, but also 
the challenges. I want to underscore something that Senator 
McCain said, which is absolutely critical. That is, the need to 
generate bipartisan support for an increasingly civilian-led 
effort. As the mission migrates from DOD and from the DOD 
budget to the civilian side, DOS, and it looks more like 
foreign aid instead of military aid in the field the reality 
which Senator McCain pointed out, is it's going to be very, 
very difficult to sustain.
    He's also pointed out, quite perceptively, if we don't 
sustain this effort then we have invested a lot of blood, 
lives, and material in an effort that could be lost, that would 
be a tragedy, as you pointed out, Ambassador Jeffrey, in one of 
those Charlie Wilson moments, where we ask goodness gracious, 
what were we thinking?
    That is a central point and it was very well said by 
Senator McCain. I wanted to emphasize it.
    Ambassador Jeffrey, you pointed out that the rough cost of 
our operations this year in Iraq, is what? Combining military 
and civilian efforts? Do you have an idea?
    Ambassador Jeffrey. On the civilian side, sir, it's roughly 
$2 billion plus. That includes the assistance program, which is 
roughly $0.5 billion or $500,000,000, and we're beginning to 
get some of the moneys for the police training program. It's 
complicated accounting. Then the operations budget is $1.797 
billion, sir. So you add it all up, it's somewhere over $2 
billion. For the military side, I'd have to defer to General 
Austin.
    Senator Reed. General Austin, what's your rough estimate of 
your operating budget this year?
    General Austin. In fiscal year 2010, Senator, it was $72 
billion.
    Senator Reed. $72 billion. You have roughly $74 billion we 
are committing annually. When the transition is completed, 
what's the number that you need, Mr. Ambassador?
    Ambassador Jeffrey. We haven't quite finalized that for 
fiscal year 2012, Senator. What I can say is the building 
blocks would be where we are now. We would like to take over 
the ISF training and equipping program as a DOS Foreign 
Military Financing (FMF) program. Right now, that's $1.5 
billion. We would ask for less, but it would be a significant 
percentage of the $1.5 billion.
    The police training program is approximately $1 billion a 
year. Taking over some of the operations in the field security 
and logistical missions, but particularly perimeter security 
and movement security would be on the order of half a billion 
or more a year. If you add all that up, you would get a figure 
that I would rather not add up, but it would be about twice 
what we are doing now.
    Senator Reed. Can you add it up, because you're better at 
math than I am.
    Ambassador Jeffrey. If I had to add it up, it would be over 
$5 billion, Senator.
    Senator Reed. We're going essentially from $74 or $78 
billion down to $5 billion.
    Ambassador Jeffrey. There would be some DOD costs 
associated with OSC-I, Senator. We don't quite know how much 
that would be, because they would be doing the security and 
obviously some of the payment of those. But clearly we're 
looking at roughly a 90 percent reduction.
    Senator Reed. We're looking at a 90 percent reduction, 
which is good news. But the reality is, unless we're prepared 
to fund your efforts at the tune of $5 to $6 billion a year, 
then you're going to have a difficult time sustaining the 
progress that we've made; is that fair?
    Ambassador Jeffrey. I'm not going to sustain the progress 
that we've made, at least in supporting the Iraqi Government.
    Senator Reed. Unless you have that money, that's right.
    What percentage is that of DOS's budget?
    Ambassador Jeffrey. It's between 5 and 7 percent of DOS's 
foreign assistance budget, the moneys that we would have for 
the FMF and for the U.S. Agency for International Development 
(USAID), roughly half a billion dollars for Economic Support 
Fund, and then the police training. For the Diplomatic and 
Consular Programs, if you strip out salaries for our people, 
the basic operating budget, which is pretty big, is almost as 
high as 30 percent in the statistics I've seen.
    Senator Reed. We're looking at 30 percent of the budget. 
This is not a nominal figure in DOS. This is a huge amount of 
money.
    Ambassador Jeffrey. This would be, taken together, probably 
the single biggest program in DOS in fiscal year 2012, Senator.
    Senator Reed. Again, let me reiterate. We all understand 
that when programs migrate from DOD over to foreign aid, we 
keep the troops in the field for support, which is a category 
that's a lot harder to sell, to be blunt, and we have to make 
that sale. That's the message that I heard on both sides.
    Let me interject another issue, I saw competition on the 
DOD side between assets for Iraq and assets for Afghanistan. At 
the same time you're trying to do this in Iraq, your colleagues 
are trying to pull military forces out in Afghanistan, stand up 
Afghan forces, and turn it over to the civilian mission.
    This is going to be a competition not only for money and 
your effort, but also for money for Afghanistan's efforts, 
which means that we have the same dilemma there. Is that an 
accurate assessment?
    Ambassador Jeffrey. Basically, it is, Senator. There is one 
difference. In a year, I'll be operating without the U.S. 
military. My colleagues in Afghanistan will not be operating 
without the U.S. military.
    Senator Reed. Another point is, when we were there DOD and 
DOS had identified over 1,000 tasks that had to be transitioned 
or accommodated. Some of them have clear DOD fingerprints; 
clearing travel routes, protecting personnel, et cetera. Others 
are tasks that are subsumed in the Commander's Emergency 
Response Program (CERP) funding, local activities, et cetera.
    I must say when you look closely at all these functions and 
the support you're getting indirectly, the positive spillover 
benefits from the military presence, that the number of $6 
billion plus you've suggested is probably an underestimate. Do 
you have a reaction to that, Mr. Ambassador?
    Ambassador Jeffrey. As I said, we try not to talk specific 
figures at this point, but in the order of magnitude of double 
what we're doing now is what we'll be looking for in fiscal 
year 2012. The support activities that the military is doing, 
is very hard to put a figure on and how much of that would 
transfer to us because it's apples and oranges. We have to pay 
the salaries of our Private Security Details (PSD) while combat 
troop salaries are in the DOD base budget.
    We get extraordinary support, billions of dollars of 
support, from the military every year, everything from Counter 
Rocket, Artillery, and Mortar identification of incoming 
rockets to logistical support, there's no doubt about it.
    Senator Reed. Thank you. My time has expired. Again, 
gentlemen, thank you for your extraordinary service.
    Thank you.
    Chairman Levin. Thank you very much, Senator Reed.
    What are PSDs, for the record?
    Ambassador Jeffrey. Personal Security Details. These are 
the people who----
    Chairman Levin. ``Private security details,'' is that what 
``PSDs'' means?
    Ambassador Jeffrey. Yes, sir.
    Chairman Levin. Just filling in what the acronym means.
    Ambassador Jeffrey. Exactly. But they could be military or 
they could be contractor security.
    Chairman Levin. Thank you very much.
    Senator Graham.
    Senator Graham. Thank you both for your service. I think 
Senator Reed brought up some very good points. The Nation needs 
to understand what's about to occur here. If you bring all the 
troops home, we all would like that to happen as soon as 
possible, you still have a country that is in a very early 
stage of development in terms of democracy. Would both of you 
agree with that, that Iraq is an infant democracy at best?
    General Austin. Yes, sir.
    Ambassador Jeffrey. I would drop the ``at best.'' I think 
they're a solid infant democracy, Senator.
    Senator Graham. Okay. We're going to say they're in the 
solid infant category. Now, just like with any other infant, 
you need to provide some assistance and nurturing to make sure 
they grow up strong and healthy, and that's the challenge 
forward, correct? Take it from an infant to a mature democracy?
    Ambassador Jeffrey. The Iraqis appreciate our assistance. 
There's an issue of sovereignty here.
    Senator Graham. No, I'm not saying that we're going to do 
it for them. We're going to help them.
    Ambassador Jeffrey. Yes, sir, it is in the strategic 
framework, specifically, air political support. We of course 
support them in election monitoring, in setting up elections, 
and in many other ways.
    Senator Graham. Does the general population want us to 
continue to be their partner in some fashion?
    Ambassador Jeffrey. The general population wants us to be 
their partner, yes, sir.
    Senator Graham. Does the military want us to help train 
their air force, General Austin?
    General Austin. They do, Senator Graham.
    Senator Graham. Okay. We have an Iraqi navy to develop, 
too. Do they also want us to help them in that regard?
    General Austin. They do.
    Senator Graham. We're not staying in a place where we're 
not wanted, is that a fair statement, whatever ``staying'' 
means?
    Ambassador Jeffrey. That's a fair statement, Senator. Most 
polls say that the Iraqi population in general would like to 
see the military presence withdrawn.
    Senator Graham. I understand that. Now, that goes back to 
what is penny-wise and a pound-foolish from an Iraq-American 
point of view. To carry out your mission in 2012 without U.S. 
military security being provided, we're basically creating a 
small DOS army, correct?
    Ambassador Jeffrey. I would have a problem with two words, 
Senator, ``creating'' and ``army,'' and I'll explain why. Right 
now we have some 2,700 private security contractors (PSC) and 
many hundreds of DOS security personnel. That figure will go up 
significantly, by an order of magnitude. The point I'm trying 
to make is we already have a large number of security personnel 
operating in Iraq under----
    Senator Graham. Is it enough to do the job?
    Ambassador Jeffrey. If we get the money to have the 
additional security, it's enough to do the job.
    Senator Graham. Well, let's talk about that additional 
security. Will it include mine-resistant ambush protected 
(MRAP) vehicles?
    Ambassador Jeffrey. It will, Senator.
    Senator Graham. Will it include helicopters?
    Ambassador Jeffrey. It'll include a large number of 
helicopters, Senator.
    Senator Graham. Will these helicopters be armed?
    Ambassador Jeffrey. They will not be armed, Senator.
    Senator Graham. But you're going to have a helicopter 
fleet. You're going to have an MRAP fleet. If something 
happens, do you have enough capacity to shoot your way out of 
it, or are you going to have to rely on the ISF if you're up in 
Kirkuk or Mosul and something bad happens?
    Ambassador Jeffrey. Currently, Senator, both the U.S. 
military and my own convoys move with ISF support in the 
cities. We assume that will continue.
    Senator Graham. How dependent are you today on American 
military security for your movements?
    Ambassador Jeffrey. Essentially all movements outside of 
Baghdad, that is all Provincial Reconstruction Team (PRT) 
movements, by agreement between the embassy and CENTCOM are 
conducted by USF-I forces. That of course will change when the 
forces go.
    Senator Graham. Okay. If all movements in Iraq to do your 
DOS and other agency jobs require USF-I to provide security and 
next year they're gone, who fills that vacuum?
    Ambassador Jeffrey. First of all----
    Senator Graham. Well, let me ask this question. Would it be 
wise from an Iraq-U.S. point of view that we not create a 
complete vacuum? Would it make sense, financially or security-
wise, to have a military footprint left behind if Iraq requests 
a continuation to provide security for DOS officials and 
others?
    Ambassador Jeffrey. We are always happy to have U.S. 
military security. They're the best in the world.
    Senator Graham. Thank you.
    From a professional military point of view, what lies ahead 
in Iraq is the holding and building. Do you believe it makes 
sense, given the security requirements that lie ahead for our 
DOS officials and others to get out and about in Iraq, that it 
would be wise to have an American military contingent in 2012 
in Iraq?
    General Austin. Senator, the ISFs have the ability to 
control the internal security in the country currently. They 
are leading the effort to do that now, and they do need 
continued work on logistics and intelligence capabilities, and 
so----
    Senator Graham. Do you feel comfortable with the ISFs as 
they exist January 1, 2012, to protect the thousands of 
Americans and other people in Iraq trying to provide assistance 
to that country? Can they do the job? Are you comfortable with 
them being able to provide that security?
    General Austin. I think that adequate security will be 
provided, provided the Ambassador is adequately resourced to 
mitigate----
    Senator Graham. Is it your opinion we do not need, from a 
military point of view, any troops in Iraq in 2012?
    General Austin. Senator, what we're focused on now is 
abiding by the agreement that----
    Senator Graham. I know, but you're advising Congress. 
You're somebody we respect. You've been on the ground a lot. 
Please put on the table what you see as reasonably necessary or 
an insurance policy, for lack of a better word. If you can 
construct the perfect scenario, what would you have that 
scenario be, regarding military involvement in Iraq in 2012 and 
beyond?
    General Austin. Senator, I would prefer to avoid 
speculating on what we would be able to do and what we could 
provide, because I think the Iraqis would have to make a 
request and then we would, as a matter of policy, our 
government would have to----
    Senator Graham. My time is up, but I understand what you're 
saying. If such a request were made by the Iraqi Government, 
they would love to have some military assistance to help them 
with the boundary disputes, to train their air force, to help 
develop better security for our people and theirs. If such a 
request was made, would you be favorably disposed to say yes?
    General Austin. If that is the policy of the American 
Government----
    Senator Graham. No, I'm talking about you. Would you 
recommend to us to say yes?
    General Austin. Senator, again that's beyond my pay grade 
to make that recommendation.
    Senator Graham. Thank you.
    Chairman Levin. Thank you very much, Senator Graham.
    Senator Akaka.
    Senator Akaka. Thank you very much, Mr. Chairman.
    I want to welcome Ambassador Jeffrey and General Austin to 
our hearing today, thank you for your testimonies today, and 
your continued efforts to ensure that Iraq becomes a stable, 
self-sufficient, and democratic nation. I also would like to 
recognize the outstanding men and women you both lead in Iraq, 
and we appreciate their sacrifice and hard work.
    Ambassador Jeffrey, in our transition we're looking at many 
ways of bringing that about, and in particular the PRTs have 
been in place throughout Iraq since November 2005 and have 
worked towards building up provincial and local economies. Can 
you discuss the current status of the PRTs as they hand over 
their mission to our consulate office?
    Ambassador Jeffrey. Yes, sir. We have gone from a total, 
including outlier posts, of roughly 30 PRTs down to 16 PRTs 
right now. These are co-located, with the exception of Irbil, 
with the U.S. military. As we discussed, they receive U.S. 
military security. They're embedded in the U.S. military units. 
They're combined military-civilian teams focusing on political, 
development assistance, rule of law, and the like.
    They have been extremely effective in partnering with the 
U.S. military on the delivery of aid, be it CERP, be it our own 
quick reaction funds, and so forth. What we are going to do is 
transform, if we get permission and the funding, four of those, 
in Irbil, Mosul, Kirkuk, and Basra, into two consulates, in 
Irbil and Basra. Also, two temporary, for a number of years, 
embassy branch offices in Mosul and Kirkuk. This also requires 
Iraq to approve, at least, the embassy branch offices. They 
have approved the two consulates. We also will keep the Baghdad 
PRT in operation and running out of the embassy. We'll have 
five.
    Then we're looking at ways in various other areas, such as 
Diyala and other areas that are important, to conduct fly-ins, 
to leverage the presence of either the police trainers or the 
OSC-I to develop ``lily pads'' that I can physically get people 
and security in, so that I can move and have contact with the 
governmental folks. We maintain some of the tremendous contacts 
and programs that we've had in places other than the five 
branches where we will continue to have a significant presence.
    Senator Akaka. Thank you. We'd like to continue oversight 
there.
    In October 2010, DOS had over 1,000 employees and 2,700 
contractors in Iraq. Current reports indicate that they plan to 
have and hire 7,000 more security contractors. Ambassador 
Jeffrey, how will you ensure that these contracts are fulfilled 
in an appropriate manner, avoiding the types of problems that 
surfaced under the Blackwater security efforts?
    Ambassador Jeffrey. Senator, we currently have 2,700 
security contractors. We'll increase, for the embassy, to 5,500 
personnel. Our police training program will require some 
security as well, let's say the better part of 1,000 more. Then 
OSC-I working through DOD will also have security contractors 
as well.
    We are very, very concerned about that, given the 
Blackwater incident in 2007 in downtown Baghdad. DOS, under 
Under Secretary Pat Kennedy, who's still in the job and watches 
this closely, wrote a report outlining all of the problems that 
led to that tragic event. As a result, we have taken various 
precautions, modifications, and reforms, as have the Iraqis.
    All of these security companies have to be registered with 
two Iraqi ministries. They're under Iraqi law. We, in addition, 
have a variety of new procedures, tactics, techniques, and 
procedures as we call them or standard operating procedures, 
that require, for example, a commissioned or full-time DOS 
security employee to ride in every convoy. We have cameras on 
the vehicles to record everything that goes on. We have Blue 
Force Trackers to monitor where they are. We have done special 
training in rules of engagement and cultural awareness. We have 
ISFs traveling and coordinating with us, and I'm happy to 
report in thousands of moves in Baghdad and in the north in 
Irbil where we've done that since 2007 we have not had a 
serious incident.
    Senator Akaka. Thank you.
    General Austin, the U.S. Government's presence in Iraq will 
change without question significantly as we draw closer to the 
end of 2011 and we redeploy the remaining military troops. What 
are the future plans for the bases and the facilities? Is any 
equipment going to be handed over to DOS, given to Iraq, or 
brought back to the United States?
    General Austin. Thank you, Senator. Actually, we'll do some 
of all of that. We will transfer equipment to DOS to help in 
their future endeavors. As they identify additional 
requirements, we'll work with the leadership in DOD to make 
sure that we transition or transfer equipment as expeditiously 
as possible.
    We're also transitioning or transferring equipment to the 
ISFs. As we've drawn down from a much larger footprint than we 
had, over 100,000 personnel, to the footprint that we have 
today. We have 77 bases that we're operating out of today, but 
when we transitioned in September from combat operations to 
Operation New Dawn, we were at somewhere around 92 bases. As 
you can see, we've continued to shrink our footprint somewhat.
    In that process, we have continued to transfer equipment to 
both the Iraqis and, again, identified equipment that should be 
transferred to the embassy based upon their request. So it's 
some of all of that, Senator.
    Senator Akaka. Thank you very much, Mr. Chairman.
    Chairman Levin. Thank you very much, Senator Akaka.
    Senator Wicker.
    Senator Wicker. Thank you, Mr. Chairman.
    General Austin, I want to take another stab at Senator 
Graham's line of questioning. I realize that you are a military 
man, that you take orders and you don't speak for yourself. You 
are under the command of the President of the United States as 
our Commander in Chief. We appreciate that, and you're going to 
implement the policies that you're directed to implement.
    But I assure you it's all right for you to come before 
Congress and give opinions as to your best judgment. I think 
that's what Senator Graham was unable to get from you in his 
line of questioning. The military troops are going to be gone 
after January 1, 2012. We're going to have a number of American 
personnel there who will still be in harm's way. So my question 
is, in your judgment, based upon your expertise, will our 
American personnel in Iraq be as secure without U.S. troops as 
they would be if troops remained present?
    General Austin. Thank you, Senator. I think Ambassador 
Jeffrey would agree with me when I say this, but because of who 
I am, I always believe that it can be done better with the U.S. 
military. As you pointed out earlier, we are right now focused 
on achieving the objectives that have been laid out with the 
current Security Agreement that exists between our country and 
Iraq, and that's where our focus has been.
    Senator Wicker. I understand that there are other 
considerations, and part of that is what the people of Iraq and 
the government wants, that they've put in place. Could you 
quantify on a scale of 1 to 10, with 10 being the security of 
our American personnel if troops remain, what will be your 
comfort level about their security without troops there?
    General Austin. Senator, I would like to avoid trying to 
quantify any kind of assessment such as that without----
    Senator Wicker. Clearly your opinion is that our personnel 
would be less safe than if we had troops there. I think that is 
your judgment. You're going to implement a different policy, 
but that is your judgment; is that not correct, General?
    General Austin. Senator, again because of who I am, I 
always believe that our military adds much value to any 
situation. I think that Ambassador Jeffrey and his team, if 
adequately resourced, can provide for the security of the folks 
that they'll have working there. It can be done better with our 
help for sure, because we have a long history of doing these 
types of things.
    Senator Wicker. Thank you.
    Then, Mr. Ambassador, let me ask you this. I want to make 
sure that we get your complete testimony. With regard to PSCs, 
your answer to Senator Akaka was: One group of 2,700 security 
personnel, another group of 5,500, and then you mentioned 
others, but I didn't get numbers there.
    Ambassador Jeffrey. Thank you. If I could take a moment 
because this is an important point. We have operated with our 
own contract security in Iraq under far worse conditions than 
we are now, when I was there last time in 2004-2005. It was 
total rock and roll. We were in Basra, Hillah, and Kirkuk 
operating on our own. We took casualties, but we did the 
mission.
    We are continuing to operate in Baghdad and in Irbil with 
our security personnel. They do a very, very good job. They 
keep our people safe. Baghdad is one of the areas where we've 
seen more attacks than most other areas; and we're prepared to 
do this throughout the country.
    Because the military security, for the places where we'll 
still be located around the country, is being withdrawn, we 
have to increase our security forces, both perimeter security 
around the consulates, embassy branch offices, and movement 
security, the PSDs. Therefore we're going from, as I said, the 
current level, which is 2,700 security contractors and roughly 
300 DOS security and support personnel, to some 5,500 
contractors, and augmenting somewhat the number of DOS 
personnel who will be supervising them.
    In addition, the police training program will bring with it 
some additional security personnel.
    Senator Wicker. How many will that be?
    Ambassador Jeffrey. I would say the better part of a 
thousand, Senator. But that we need to get back to you on.
    [The information referred to follows:]

    The Department will provide protective security and static security 
personnel under the Bureau of Diplomatic Security (DS) Worldwide 
Protective Services (WPS) contract for INL-I programs beginning in 
fiscal year 2011 with anticipated security personnel increases in 
fiscal year 2012. For fiscal year 2011, the staffing plan consisted of 
322 WPS static guards at FOB Shield in Baghdad. However, temporarily, 
the DOD TWISS contract will provide static guard services until April 
1, 2012, at which time 322 WPS static guards will assume operations. In 
Baghdad, INL will have 204 WPS protective security detail (PSD) 
personnel, 62 WPS PSD personnel in Erbil, and 54 WPS PSD personnel in 
Basra. INL-I's anticipated security personnel staffing needs in fiscal 
year 2012 will increase to 291 WPS PSD personnel in Baghdad, 103 WPS 
PSD personnel in Erbil, and 79 WPS PSD personnel in Basra. Static 
Security requirements for Baghdad at FOB Shield are expected to remain 
the same in fiscal year 2012. The total number of anticipated WPS 
security personnel initiating operations in fiscal year 2011 is 320, 
with an additional increase of 153 being added in fiscal year 2012 for 
an overall total of 795 WPS personnel.
    Five DS Special Agents under Regional Security Office (RSO) Baghdad 
will work in direct support of the INL mission in Iraq. These agents 
will manage security programs that directly relate to INL, and along 
with other DS personnel, provide operational oversight of WPS contract 
personnel. DS personnel will not be training providers. Although their 
primary duty is to manage programs, DS Special Agents are fully 
prepared to serve as agents-in-charge (AIC) of INL PSDs, lead quick 
response force (QRF) operations, conduct security surveys of INL 
locations and perform other security duties as needed. Another 
important duty of these DS Special Agents will be to maintain strong 
working relationships with their Iraqi Security Force counterparts.
    Depending upon the scope and range of the Police Development 
Program, up to 30 DS Security Protective Specialists (SPS) under RSO 
Baghdad will also be assigned to support INL programs in Iraq. In 
addition to assisting DS agents in managing security programs, Security 
Protective Specialists will lead INL PSDs as AICs, providing direct 
operational supervision of WPS personnel. SPS will also staff positions 
requiring unique skill sets such QRF teams. SPS personnel will not be 
training providers.

    Senator Wicker. We have 5,500, then 1,000.
    Ambassador Jeffrey. Then----
    Senator Wicker. Then there's OSC-I.
    Ambassador Jeffrey. OSC-I, which is the military support 
element under the embassy, that will be providing security 
assistance, training and equipping, and these FMS cases, they 
will require security as well. But I don't have a number on 
that.
    Senator Wicker. Okay. You mentioned what the population of 
Iraq want with regard to continued U.S. presence. I know at a 
time there was extensive public opinion polling going on of the 
Iraq people. Mr. Ambassador, is that still the case?
    Ambassador Jeffrey. There is a good number of different 
polls that come out all the time, done by various international 
agencies, private companies, the Iraqis themselves, sir.
    Senator Wicker. Are you privy to that information?
    Ambassador Jeffrey. We see a lot of it, that's right.
    Senator Wicker. Based on that, the information you have is 
that a substantial majority of the Iraqi people would like the 
United States to continue with a security presence there absent 
the military; is that correct?
    Ambassador Jeffrey. I wouldn't say a substantial majority, 
but it's much higher amount wanting a relationship with us, 
than the percent of the population that want to have an 
American force presence. That typically is quite low, between 7 
and 20 percent, other than in the Kurdish areas, where it's up 
about 50 percent or higher sometimes.
    Senator Wicker. With regard to the situation that we intend 
to have after January 1, 2012, is there majority support for 
that?
    Ambassador Jeffrey. I would have to check the polls, 
Senator. It's a tricky question. It was a tricky question 
when----
    Senator Wicker. They get tricky even done inside the United 
States.
    Ambassador Jeffrey. I know, but----
    Senator Wicker. It depends on the question.
    Ambassador Jeffrey.--they're particularly tricky, frankly, 
in the Middle East, where I've spent much of my career. They 
were tricky inside Turkey, where in all of these countries, 
there is a nervousness about countries having too close 
relations with anybody, including Iran, which does not fare 
well in any poll in Iraq. Or the Sunni Arab countries or 
Turkey, they're nervous about relations with anybody because 
all of these countries have had a long history of being 
exploited by neighbors, colonialization and such in the case of 
Iraq. The general reaction of the population is to be wary.
    Nonetheless, as we judge these things, taking that in mind, 
we would say that there is a general positive feeling on the 
part of the population towards relations with the United States 
in general and the program we'll have after 2012.
    Senator Wicker. Thank you, and thank you both for your 
service.
    Chairman Levin. Thank you, Senator Wicker.
    Senator Ben Nelson.
    Senator Nelson. Thank you, Mr. Chairman, and let me add my 
appreciation for your service and the men and women in uniform 
who serve, as well as the civilians who serve at the present 
time.
    I find the discussion about good, better, or best in terms 
of security there in Iraq as to how we provide it and which 
will work best. The presence, the amount of our presence, and 
the quality and the nature of our presence is an Iraqi decision 
more than it is ours. Having said that, isn't the question, 
General, whether or not DOS will, with proper resourcing, be 
able to provide adequate security?
    General Austin. That is one of the important questions, 
yes, Senator.
    Senator Nelson. Yes, we could do it better. We could do the 
belt and suspenders approach. I understand the level of 
continuing to provide even more and I would support and 
appreciate the fact that you've pointed out that you feel that 
the military can do it better. You should feel that way. We 
should all feel that way.
    It's not about better. It's about adequate and getting it 
done sufficiently to protect our presence in Iraq as well.
    Now, let's get it on the table. Mr. Ambassador, you said 
Iraq has not asked for any continuing U.S. military presence at 
this time. This is a tough question because you don't have a 
crystal ball. Do you expect that they will ask for some 
continuing military presence after the expiration date? It's a 
possibility. Do you expect it?
    Ambassador Jeffrey. Again, my crystal ball doesn't reach 
that far, Senator. I expect them to want to talk more with us 
about their security needs, and how they can be met. This is a 
country with security forces right now of some 650,000 people. 
They have basically beaten an insurgency and they're doing well 
against a continued but still relatively small resistance, 
compared to the past terrorist threat.
    Senator Nelson. They probably have a reasonable 
understanding of their capabilities today, and we would hope 
that they would have a reasonable expectation, understanding, 
and evaluation of their security capabilities at the point of 
departure. It's not unreasonable to expect that if they're 
inadequately resourced in security, that they might want to 
have some additional help. We're not anticipating that at the 
present time, but that's perhaps one of the plans that we ought 
to have in mind. Is that fair?
    Ambassador Jeffrey. As I said, we are already preparing to 
provide that help with police training, FMS, FMF, and the 
multitude of security and military assistance of various forms 
that are required. To turn them into a foundational 
conventional defense force that they need to be and where 
they're not now, will require a good deal of help.
    How that help is construed, whether it can fall into the 
program that we have set out after 2012 or would require 
something more, is something that they haven't come to us and 
talked to us about.
    Senator Nelson. This would constitute conditions on the 
ground at the time, is that fair?
    Ambassador Jeffrey. That's what will drive their decisions 
on talking to us about this, Senator.
    Senator Nelson. In terms of turning over equipment, I've 
always been concerned about the fact that we don't want to be 
the kind of military that we are bought and paid for by a 
foreign country on the one hand. On the other hand, as we 
transfer equipment are we finding ways for them to pay for the 
costs of that equipment, either at the current time or with 
some future arrangement for them to pay us back rather than 
simply providing equipment and leaving it free of charge? 
General Austin?
    General Austin. Some of the equipment has and will, in 
fact, be paid for, Senator. It depends on the category of the 
equipment. The answer to your question is yes.
    Senator Nelson. I know that some time ago we entered into 
an agreement with Iraq, where, when they were having trouble 
acquiring equipment because of their own internal inadequacies 
and procedures, we actually acquired it on their behalf with 
their money. My hope is that we will be as careful with the 
taxpayers' dollars in the transfer of the equipment as we 
should be. Recognizing that we are paying for a great deal of 
the war in Iraq. It's a tremendous impact on our budget. It's 
not the driving force as to whether or not we continue to do 
what we think is right, but it is a factor, and I hope that 
everybody will be focused on that as we create this transition.
    Can you assure me, both of you, that, not out of the 
goodness of our heart, but recognizing the importance to doing 
this in a good, sound economic way that we will try to recover 
as much of our costs in that transfer as possible? Ambassador?
    Ambassador Jeffrey. We have been pressing them to increase 
and they have, Senator. They spend $8 billion a year on their 
security forces. That has been going up. The percentage of how 
much they put into their equipment purchased externally and how 
much we put into it has been rising in their favor and it will 
continue to do so. This is not a long-term program that we're 
envisaging.
    Senator Nelson. General?
    General Austin. Yes, sir. In addition to that, they have 
about $13 billion or so worth of FMS cases that we are 
processing with them. They are not only investing in their own 
future, but we are playing a large part of that. They're 
investing in our equipment as well.
    Senator Nelson. This could be the third leg of that, to 
recover some of our costs as we make that transfer. It's 
consistent with where the trend is and we just ought to make 
sure this is part of that trend?
    General Austin. Yes, sir.
    Senator Nelson. Thank you, Mr. Chairman.
    Chairman Levin. If I could clarify something, Ambassador, 
in answer to Senator Nelson's question you said the percentage 
that Iraq is paying is rising in their favor. You mean that the 
percentage that they're paying is rising or they're paying 
more?
    Ambassador Jeffrey. They're paying more. Of the weapons 
systems that have been flowing in to them, the percent of the 
total cost that they pay for has been rising consistently for 
the last several years.
    Chairman Levin. When you use the term ``rising in their 
favor,'' it's rising in our favor, not in their favor, as far 
as I think Senator Nelson's point was.
    Ambassador Jeffrey. Exactly.
    Chairman Levin. Senator Ayotte.
    Senator Ayotte. Thank you very much, Mr. Chairman.
    I want to again commend both Ambassador Jeffrey and General 
Austin for your distinguished service. I want to also thank our 
men and women in the armed forces for their sacrifice and the 
tremendous progress that we've made in Iraq, and also their DOS 
counterparts and the important work that you do.
    Ambassador, can you think of another circumstance where DOS 
has had the security responsibilities, you said that we will 
have, of approximately at least 5,500 contractors, perhaps 
another thousand security personnel, and have had success in 
transitioning from a military security basis to that much 
security responsibility?
    Ambassador Jeffrey. Back in 2004-2005, Senator, when I was 
there, we provided essentially all of our own security for our 
operations throughout Iraq. It was not as large as this 
program, but it was significant. DOS provides the security for 
all of our personnel in Pakistan. While it's a somewhat, from 
other circumstances, an unfortunate analogy, but I was involved 
in the transition on the military side when we turned over to 
the embassy in Saigon with a tremendous equipment delivery and 
security mission in February 1973.
    Senator Ayotte. Ambassador, I believe you testified that 
when you were in Iraq previously that it was sort of ``rock and 
roll'' in terms of what you were dealing with. One of the 
concerns that I have is, obviously, we don't want to put our 
personnel in that position again, where those are the 
circumstances under which they are working, and I'm sure you 
share that concern as well.
    What circumstances do you anticipate that you may recommend 
to your superiors that we approach the Iraqi Government to ask 
for an extension of the military presence past 2011 deadline?
    Ambassador Jeffrey. Let me put that a little bit 
differently, Senator. The assumptions I have made that we can 
do, I would go beyond adequate, security that I'm comfortable 
with putting people out there based upon the continuation of 
the current security trends. That is, with attacks down 90 
percent from the high point back in that era; with the ISFs on 
the job. They still have some areas that need to be improved 
and that exposes certain weaknesses, but they're the outer 
security, we're the inner security, if you will. Most of the 
time, they fend off most of the threats, particularly the 
bigger tactical or military threats, and we have to worry more 
about bombs, IEDs, snipers, and that kind of thing, as opposed 
to platoon-sized ambushes.
    If that were to change, if the ISFs no longer could control 
large areas where we're moving, I would be in a different 
circumstance and would have to consider options at that time, 
and there are many options. Again, I'd like to wait until those 
circumstances arise and I do not expect them to arise at this 
point.
    Senator Ayotte. With that many contractors that you're 
currently relying on, and relying on additional contractors as 
this transition is made, are you confident that there's 
sufficient oversight to address waste, fraud, and abuse with 
taxpayer dollars that are funding those contractors?
    Ambassador Jeffrey. Any large program, Senator, and this is 
already a large program, requires oversight. It requires both 
people on the ground, contracting officer representatives, who 
follow up. We have a very active program at the embassy. We're 
under constant supervision, as cited earlier by the chairman, 
the SIGIR; our own IG, military IGs for their side of the 
operation; and our own internal controls and my Deputy 
Assistant, Ambassador Peter Bodde, particularly watches over 
that.
    Senator Ayotte. General, a question about our forces in 
Kuwait. They are offering logistical support in Iraq and also 
Afghanistan at this time. Do you anticipate any enhanced force 
presence in Kuwait in case there is an emergency in Iraq from 
either Iranian aggression or some other form, where security 
regresses in Iraq?
    General Austin. Actually, Senator, that positioning of 
forces in Kuwait really falls in the domain of the CENTCOM 
commander, General Mattis, and the commander that he has 
forward on the ground there, General Webster. In support of our 
operations in Iraq, I would not want to speculate that we have 
to increase the amount of forces in Kuwait. That is not a part 
of the plan as we look ahead here.
    Senator Ayotte. Thank you very much.
    Chairman Levin. Thank you, Senator Ayotte.
    Senator Webb is next.
    Senator Webb. Thank you, Mr. Chairman.
    Ambassador Jeffrey and General Austin, I'd like to thank 
you and all the people who are working with you during this 
transitional period as we climb out of a hole that we dug 8 
years ago, in the view of many people and myself, having come 
from an enormous strategic blunder. We were worried, and were 
saying so at the time, that this endeavor would harm the 
country's economy, that it would blow the top off of the price 
of oil. I recall when Congress voted to go to war in Iraq oil 
was $24 a barrel. It went up to $143 and today it's about $102.
    We were concerned that this activity would empower rather 
than contain Iran, that it would encourage greater activities 
of al Qaeda in a country where it had not been active to any 
degree before and it had the potential to destabilize the 
region. Most importantly, there were concerns that I shared and 
wrote about before the invasion, that the invasion of Iraq 
would create the temptation or the possibility of a long-term 
occupation by the United States in a part of the world where we 
should not be an occupying power.
    This last point has been the underlying premise of a number 
of questions that have been raised today about what's going to 
happen to the military presence in Iraq in the immediate 
future. I have read the Status of Forces Agreement and the 
Strategic Framework Agreement. They're not airtight, as I think 
you know, in terms of the requirement for United States 
military withdrawal.
    There are people on this committee, and in the Senate, who 
have argued that the United States should remain in Iraq in the 
same sense that it's remained in Korea, as a projection force. 
Some arguments were made during the past campaign that we 
should be there for another 50 years.
    There really are two different questions when it comes down 
to whether our military should remain in Iraq. The first is 
whether they are needed in domestic terms, which is what a lot 
of the discussion has centered on today. The second one, and 
the most important one, is beyond this transition period should 
we or are we discussing the notion of providing bases in Iraq 
as a projection force that could be used externally from Iraq 
or in a situation other than for the domestic concerns that 
you're talking about.
    Ambassador, have you had any discussions of that?
    Ambassador Jeffrey. We haven't, Senator. To go back to 
2008, I was involved peripherally in the negotiation of these 
agreements when I worked on the National Security Council and 
the Iraqis made it very clear at that time. It was in black and 
white in the agreement, somewhere between articles 24 and 27, 
that we are not to have permanent bases, we are not to use our 
presence in Iraq to project power of any sort or in any way 
outside of Iraq. That was the explicit understanding that the 
administration at the highest levels, and I was present for 
these deliberations, went into with that agreement. Our 
presence in Iraq as we move forward from 2008 to the end of 
2011 would be solely to help the ISF and the general stability 
of the country.
    Our belief, Senator, after 20 years of having highs of 
500,000 troops in 1991 and lows of a few tens of thousands of 
troops with Operations Northern Watch and Southern Watch, was 
that securing Iraq, making it a relatively peaceful place that 
didn't require the kind of military commitments, large- or 
medium-sized, that many administrations and both parties have 
supported for the 20 years. This was a great security benefit 
in and of itself. Therefore we decided to keep the forces on to 
finish the fight, if you will, and we think we're pretty close 
to that by the end of this year. But the Iraqis have no 
intention of having us have bases or project power and that's 
not our intent at all, sir.
    Senator Webb. Let me clarify something from what you said 
or get a clarification from you. There has been a lot of 
discussion this week in the previous hearing in the Senate 
Foreign Relations Committee, and this one as well, that Iraq is 
not presently capable of providing security against external 
threats. I assume we are keeping military forces in Iraq to 
address that issue for some period of time, where that is a 
part of a formula?
    Ambassador Jeffrey. Under the current agreement, Senator, 
we are not going to keep military forces in Iraq after 2011. 
What we will do, given the fact that Iraq does not have a 
foundational conventional defense, external defense capability, 
it's just beginning to focus on that because its focus has been 
on internal security, what we're going to do is to continue our 
training and equipping program, which will be quite extensive. 
Both FMF and FMS programs that they purchase for main battle 
tanks, armored personnel carriers, 155-millimeter self-
propelled and towed howitzers, aircraft systems, and other 
platforms, that they can develop this capability.
    We're going to be there with them, helping them do this in 
a very broad and extensive way, but at this point not with 
combat troops on the ground, sir.
    Senator Webb. In an advisory capacity, as opposed to with 
independent units?
    Ambassador Jeffrey. That's the plan, exactly.
    Senator Webb. Just so I'll understand, it's been some time 
since I've read the Strategic Framework Agreement, but there 
was, and I can provide it for the record if necessary, there 
was loose language in the sense of a further agreement being 
possible if the Iraqi Government, for instance, decided that it 
needed help beyond a period of time.
    Ambassador Jeffrey. In the first agreement, the Security 
Agreement, Senator, there is an article that says that either 
side can ask to extend it, just like either side can ask to 
terminate it. In the Strategic Framework Agreement, there's a 
section on security. That's section 3. Section 10 basically 
states that additional agreements within the framework of the 
Strategic Framework Agreement can be set up to do one of the 
many purposes of the Strategic Framework Agreement, that can be 
culture, it can be energy, and it could be security.
    Senator Webb. Just to clarify the point because my time is 
up, it is your understanding that as of the end of 2011 the 
formal commitment of the United States, as ground forces per se 
or combat forces per se will have ended and the transition 
would be into advisory roles, as we've been discussing today. 
Is that correct?
    Ambassador Jeffrey. It is our plan that we will have a 
security relationship, Senator, and quite possibly a follow-on 
agreement under article 10 to talk about how we would do that 
advisory and training function. It would be an advisory and 
training function under title 22 authorities under DOS as a 
security assistance organization, as opposed to a combatant 
commander subordinate force, sir.
    Senator Webb. Thank you very much.
    Thank you, General.
    Chairman Levin. Thank you, Senator Webb.
    Senator Udall.
    Senator Udall. Thank you, Mr. Chairman.
    Before Senator Webb departs, I wanted to associate myself 
with his initial remarks. I think the Senator brings an 
incisive set of impressions and analysis to the decisions 
leading up to the invasion of Iraq. I know I served in the 
House at the time and asked many of those same questions. I 
know the chairman as well has been deeply involved in those 
considerations. I think at great peril do we forget those 
lessons in the long run.
    Good morning to both of you. Welcome. Thank you again for 
the hospitality that you provided to Senator Whitehouse and 
myself when we were with you in October. General Austin, thank 
you for your in-depth military operations brief and the way in 
which your personnel showed us the country.
    Ambassador Jeffrey, your hard work paid off. We were privy, 
with your assistance, to a series of meetings with political 
leaders across the spectrum in Iraq. I note that your analogy 
of mixing bitter tea with sugar so that everybody could drink 
out of the same pot of tea in the end prevailed. 
Congratulations for those successes there and for the 
establishment of a government.
    I also want to acknowledge the partnership that you have. I 
think it models the partnership that Ambassador Ryan Crocker 
and General David Petraeus had preceding you. The jointness 
that we now have in our civilian and military efforts is really 
key to the successes that we want to have.
    I know the immense challenge that we have in front of us. 
We're discussing that here today. As you've explained, the 
success of the transition will be dependent on a number of 
factors, many of which we have little or no control over. 
Again, we're engaged and your leadership is very, very 
important.
    If I might specifically move to Al Anbar, we had a chance, 
General, to travel out to Ramadi and the progress there was 
significant. In your written testimony, you assess that AQI 
will remain capable of signature attacks, but will lack public 
support. Are there any conditions under which you could imagine 
that public support for AQI would again increase like we saw in 
those tough days in Al Anbar in particular?
    General Austin. I'll offer my thoughts first and then offer 
the Ambassador the opportunity to provide his thoughts.
    I don't think so, Senator Udall. I don't think the people 
want what AQI brings to their country. They had a good look at 
that a while back and a couple of years ago they decided that 
they wanted something different. So AQI does not enjoy the 
support of the people, and I don't see them returning to 
prominence to the degree that they were a while back.
    I think that the people have seen better times. They want 
different things. They want a greater sense of security in the 
country. I don't see it returning.
    Ambassador Jeffrey. I agree with General Austin, sir.
    Senator Udall. Ambassador, referencing the image you 
continue to share with the Iraqi leadership of bitter tea 
sweetened, the Sadrists are now part of the ruling coalition 
government. Al Sadr himself, I understand, has returned back to 
Iran after he had a triumphant return to Iraq earlier this 
year. Is there any significance to those developments?
    Ambassador Jeffrey. As a general rule, Senator, at this 
time in Iraq, it's not just our assessment from the outside, 
but it's the assessment of the Iraqis that an inclusive 
government that brings in all of the political actors, 
including some of the more problematic political actors, is a 
good thing. This too allows inside the government, the 
coalition, and the parliament people to work out compromises 
and to move forward.
    In that sense, Iraqis believe, including some that are 
quite suspicious of the Sadrist movement, that them being in 
the government is a good thing. Many Iraqis that I talk to also 
are quite pleased that their role in government is not 
particularly large. I think that I'll just stop there.
    Senator Udall. Yes.
    We've had some conversation this morning, including Senator 
Nelson's questions to you, about the transfer of equipment, 
authorities, and missions from the DOD to DOS. I think we all 
acknowledge there will be some other bumps in the road as the 
transition continues. Can you help us understand if there's 
more we could do in Congress to help expedite this transition?
    Then I was also thinking in addition, given the eventual 
likelihood and I think it has to be a certain likelihood, that 
there will be a similar transition in Afghanistan, do you see a 
need for a set of authorities to guide such transition? In 
other words, from DOD to DOS. Ambassador and then maybe the 
General could add his thoughts.
    Ambassador Jeffrey. Very briefly and I'll turn it over to 
the General because there are some authority questions on the 
DOD side. It's not a question of authorities at this time, 
Senator. It's a question of the funding. We need the funding. 
As we talked earlier, this will be a substantial part of the 
DOS budget, but a very small part of what we had been paying 
just a year before overall from the Federal budget for Iraq. 
We're hoping that people will focus on that latter point rather 
than on the former point, that it's a big chunk of the DOS 
budget.
    Senator Udall. If I can interrupt, General, just for 30 
seconds--Ambassador, that, although the number of 17,000 
employees sounds large, it's actually a significant decrease 
from what was 85,000 personnel on the ground at one point in 
Iraq. Is that accurate? Please correct me if I'm misinformed.
    Ambassador Jeffrey. The military presence, I'll leave that 
to General Austin. I can't give the figures for that. But it 
obviously is many times what the 15,000 and to 10,000 to 20,000 
range that we're looking at.
    Senator Udall. Over that working lunch we had with your 
team that we were actually drawing down quite significantly.
    Ambassador Jeffrey. The overall U.S. Government footprint 
in the country will be a dramatic decrease of way more than 90 
percent from its highest point.
    Senator Udall. General Austin?
    General Austin. When we were operating as a coalition 
force, Senator, we had upwards of 160,000 total people in the 
country. We drew down to about 100,000 or so when the United 
States began to provide the majority of the assistance there.
    Then, most recently, we've drawn down to a little less than 
50,000. That's a pretty significant transition over time.
    Back to your question on authorities, we do need additional 
authorities to fund the renovation and construction associated 
with the standup of the OSC-I. We would look forward to working 
with Congress to be able to obtain those authorities.
    Senator Udall. Thank you again for your service. I look 
forward to seeing you in country perhaps later this year.
    Chairman Levin. Thank you, Senator Udall.
    Senator Manchin.
    Senator Manchin. Mr. Chairman, thank you.
    To Ambassador Jeffrey and to General Austin, thank you for 
your appearance today. As one of the new people on the 
committee and new to the Senate, I want to also thank you and 
DOD for bringing us up to speed as quickly as possible.
    General Austin, I'll start with you if I may. As a person 
who comes from the State of West Virginia, who is extremely 
patriotic, like this entire Nation, we thank you for your 
service.
    Sir, at the time of the attack on September 11, we pretty 
much knew that al Qaeda was our enemy and that was our 
direction of force, if you will. Who have you identified as our 
enemy today that we're fighting in the Middle East, whether it 
be Afghanistan or Iraq? What is the strength of the force of 
that enemy?
    General Austin. Iraq remains a very complex environment, 
Senator, and there are a number of elements that play in Iraq 
that oppose not only our efforts, but, most importantly, the 
Government of Iraq's efforts. To start with, we've spoken of 
AQI earlier. AQI is much diminished in terms of capability if 
we look at it today versus what it was a couple of years ago. 
Our counterterrorist forces have had tremendous impact in 
reducing the capability of the network. We've taken a number of 
their senior leaders off the battlefield over time. We've 
reduced their capability to finance themselves, and we continue 
to place pressure on AQI.
    Senator Manchin. What's the number, sir, just for my 
information, as far as what would be their number of strength? 
Is it 10,000, 5,000, 100,000, al Qaeda?
    General Austin. I'll take that question for the record, 
sir, because I want to make sure we're accurate there. But it's 
in the several thousands, but certainly not 10,000.
    [The information referred to follows:]

    [Deleted.]

    Senator Manchin. Okay.
    General Austin. Their ability to do what we saw them do in 
the past is somewhat diminished. Having said that, they do have 
the capability to conduct high-profile attacks and we've seen 
that most recently during the Arba'een celebration here as we 
saw Shia pilgrims march down towards Karbala. We expected that 
AQI would try to attack some of the pilgrims and they did.
    There are also other Sunni insurgent elements that are in 
the environment, like Jaysh Rijal Tariqah al-Naqshabandi for 
example. Their focus is currently on U.S. forces. We believe 
that if we are no longer there then they will turn their focus 
on the Iraqi Government.
    Turning to Shia extremist elements, there are three major 
elements that we focus on on a daily basis. The first is Khateb 
Hezbollah and the number for Khatib Hezbollah is a couple of 
thousand. Then Asaib Ahl al-Haq, also a couple of thousand. 
Then the Promise Day Brigade, that element has been associated 
with Sadr.
    It remains a complex environment. Each of the elements have 
their own focus. The Shia extremists, for example, are 
primarily focused on us currently. There's no question in my 
mind that if we are no longer there they will turn their focus 
on the Government of Iraq.
    Senator Manchin. Trying to get a handle on this, the amount 
of forces that we have in the Middle East right now is at what 
level, the amounts? 100,000?
    General Austin. In the entire Middle East?
    Senator Manchin. Iraq and Afghanistan.
    General Austin. I think there are about 98,000 troops in 
Afghanistan. Our current footprint in Iraq is less than 50,000, 
a little bit above 47,000 currently.
    Senator Manchin. A little less than 150,000, and we've 
identified not that many thousand enemies.
    General Austin. Right. Of course, we have forces in other 
parts of the Middle East.
    Senator Manchin. I'm sure of that. It makes it confusing 
for those of us who don't have the military experience, and us 
being such a technology-based military, why we have such a 
presence with such few enemies identified.
    General Austin. I understand the question, Senator. I would 
say that when you look at the numbers, it could be misleading 
to compare numbers of friendly forces to suspected numbers of 
enemy forces. You have to really take into account the type of 
operations, the type of warfare that you're conducting. The 
types of operations that we're doing in both Iraq and 
Afghanistan are very, very difficult.
    Currently in Iraq, we are focused primarily on advising, 
training, assisting, and equipping the ISF. We are partnering 
with them in conducting counterterrorist operations, but we 
shifted our focus from combat operations with our conventional 
forces back on September 1.
    Senator Manchin. What differences do you see from the 
Soviet war with Afghanistan and the war that we're fighting?
    General Austin. I would defer to Dave Petraeus and his 
leadership to really provide those comments.
    Senator Manchin. They had overwhelming forces and 
superiority, the same as we have overwhelming forces and 
superiority in comparison; correct?
    General Austin. There have been a number of attempts to 
compare what the Soviets did to what we are doing in 
Afghanistan. Some people would draw parallels and others would 
not. Again, we're taking a different approach to what we're 
doing there in terms of protecting the people and working with 
the people. It's very difficult to make a direct comparison 
from the Soviets to us.
    Senator Manchin. Ambassador Jeffrey, if I may. A tremendous 
amount of resources that have been invested into the war in the 
Middle East by the United States, especially Iraq and 
Afghanistan, that I have heard could be extracted, particularly 
the oil and development of the oil fields in Iraq. It's hard 
for a lot of, especially West Virginians, but also Americans to 
understand. Is there a return for us or any sharing of that, or 
are we all in with nothing in return?
    Ambassador Jeffrey. Senator, it's a good question and it's 
a question that is both above my pay grade and that every 
single citizen needs to look at. The logic of what we've been 
doing since World War II, and almost everything that I've been 
involved in for the last 40 years flows from that, is that if 
we can maintain international security, freedom of trade, 
promote democracy, we won't ever have to go through something 
like what we went through in the first half of the last 
century--World War I, World War II, the advent of the nuclear 
threat. In the long run, while it is indirect, that brings 
tremendous benefits to the American people and to the rest of 
the world.
    It's not a zero sum game. It's not that we benefit like 
Rome benefited at the expense of many of the people on the 
periphery. Everybody benefits together, the system is stable, 
and we're able to deal with the threats to it. What we're doing 
in the Middle East is dealing with one of the threats to this 
system that's been in place for the last 60 years, sir.
    Senator Manchin. Basically we get, as a country and our 
general fund, no return on the investment we're making. That'll 
be turned over to the private sector.
    Ambassador Jeffrey. As I said, Senator, we as a Nation 
benefit tremendously from international security and not having 
to spend 15 or 20 percent of our gross domestic product on the 
military.
    Senator Manchin. Thank you, Mr. Chairman. I have other 
questions I'll submit.
    Chairman Levin. Thank you, Senator Manchin.
    Senator Blumenthal.
    Senator Blumenthal. Thank you, Mr. Chairman.
    I want to join in thanking both of you and the men and 
women who serve with you for your service. General Austin, many 
of your soldiers and others who serve in our military are from 
Connecticut and have been to Iraq not just once but twice, and 
some three times, in tours of service. I would guess that very 
rarely in our country's history have few of the total number of 
people who live in this country, our citizens, borne so much of 
the burden militarily for this country.
    To you, Ambassador, my thanks on behalf of Connecticut and 
our country to the members of the foreign service who are in 
not only Iraq but other dangerous places in the world. We have 
only to look at today's headlines to see how dangerous those 
places are to civilians as well as the military.
    I want to focus my questions on an area that hasn't been 
covered and perhaps would seem to be outside this committee's 
jurisdiction, but I think is very relevant to the transition 
you've been describing. The economic progress of Iraq, which in 
the long-run, maybe even in the short-run, will make possible 
its funding for the continued protection of its own citizens.
    Perhaps, Ambassador, if you could give us your analysis of 
the progress that's been made economically, the prognosis for 
Iraq making further progress and thereby funding some of the 
activities we've been describing today.
    Ambassador Jeffrey. Certainly, Senator. Very briefly, Iraq 
has a population of about 28 million people. It has a per 
capita income of roughly $3,000 per person. This puts it on 
roughly the level of the Republic of the Congo. It is a very 
poor country today, despite it being naturally a rich country, 
in oil and agriculture, with an educated population, because of 
horrific leadership by Saddam Hussein and some of his 
predecessors over decades of repeated wars and internal 
turmoil.
    The bulk of their economy, over two-thirds, is in the oil 
extraction. Right now they're improving, thanks to the help of 
international oil companies that were brought in about a year 
and a half ago, and we anticipate that oil production will be 
up perhaps as high as 2.6 to 2.8 million barrels. That's 
roughly equivalent to or a little bit more than Kuwait or the 
United Arab Emirates and a little bit less than Iran. By the 
end of the year, exports will be well over 2 million barrels a 
day. That's their main foreign exchange earner.
    The non-oil economy is growing at a rate of about 6 percent 
to 8 percent. Over time it will begin to deal with the 
unemployment problem. But right now we have 18 percent 
unemployment, which is obviously very high and has a security 
dimension as well, because next to unemployment there is an 
even higher level of underemployment, particularly of young 
men. This is very worrisome to us, and it's one of the targets 
of the many programs we've done through USAID, through the 
military and CERP.
    In terms of the oil, as I said, the Iraqis have had 
considerable success with the international oil companies in 
increasing up to 10 percent the output of these fields. This 
could go up as high as 6 to 8 million barrels a day. Some 
people see even higher, putting it almost in the range of Saudi 
Arabia.
    However, there are major breaks on such developments. First 
of all is the infrastructure. In fact, they will be slowed 
down, in terms of continuing to export their additional 
production, because they have to repair the offshore terminals. 
That work won't be complete until the end of this year at best.
    Second, they will then have before them major improvements 
to the internal storage tank and pipeline infrastructure that 
gets the oil from the fields to the terminals. They're going to 
have to repair the northern pipeline that goes to Turkey if 
they want to get over 700,000 barrels, and the potential up in 
the north is quite a bit above that.
    That will require an awful lot of their oil earnings to be 
poured back into repairing the infrastructure in order to prime 
the pump, if you will.
    Likewise, the oil companies are on cost-plus contracts 
basically and they're starting to recover their costs. Much of 
the increased production profits are going to go to covering 
the costs of the oil companies, rather than improving the Iraqi 
budget. It's going to be a number of years before we see a 
significant impact on the Iraqi budget of these increases. 
Nonetheless, the very economic activity associated with that 
and the general slow improvement in the economy augurs well for 
the next 5 years if we can get over the remaining security and 
economic problems.
    Senator Blumenthal. At what point do you envision that the 
Iraqis themselves would take over a greater share of funding 
their own security?
    Ambassador Jeffrey. Right now, they are funding the vast 
majority of their security, $8 billion a year. The ISF program 
is about $1.5 billion which I think was asked for in the 
program, and we have about a $1 billion police training 
program. Right now it's $2.5 billion plus the cost of the U.S. 
military being there.
    But within a few years our programs will basically 
terminate and they will be on their own, and we think that 
they're in a position where they can continue at that level.
    Senator Blumenthal. What is the current level of security 
of the Iraq oil fields, its production, and output facilities?
    Ambassador Jeffrey. The security is provided by Iraqi 
forces, on the outer perimeter. The inner perimeter is the 
security companies themselves. They, just like us, hire PSCs to 
do the job. There are many of them operating in the private 
sector there. Also there's overwatch by General Austin's people 
in the south, who coordinate closely with the oil companies and 
with the ISFs in terms of intelligence-sharing and improving 
the capabilities of the Iraqi forces.
    You basically have three separate levels of security, sir.
    Senator Blumenthal. Thank you very much, and again my 
thanks to both of you for your service to the country.
    Thank you.
    Chairman Levin. Thank you, Senator Blumenthal.
    We'll have a round two for those who want to ask questions. 
I just have a few.
    General Austin, you were reluctant to speculate as to what 
your recommendation be if there were a request from the Iraq 
government for any military support beyond the December 2011 
date. It relates to that question, which is asking your 
personal and professional military view, from a military 
perspective, as to whether or not you agree with the current 
policy of the administration to remove all U.S. military forces 
from Iraq by the end of this year?
    General Austin. Senator, the agreement that I think that 
we're referring to is between our country and the Government of 
Iraq, and that agreement says that unless a request is made by 
the Iraqis to extend the agreement or a request for assistance 
is made, then our mandate is to reposition or reposture all 
forces.
    We're on track to do that. Now, certainly if the Iraqis 
decide that they need further assistance and a request is made 
to our government, then I think Secretary Gates has been clear. 
He said that we would certainly consider that. But that policy 
is in the domain of our leadership and I really would not like 
to speculate on it.
    Chairman Levin. I'm not asking you to speculate as to what 
would happen if there's a request. I am asking for your 
personal professional military view on whether or not you 
believe that we have the correct policy now, which is to remove 
all of our combat troops, from Iraq by the end of this year?
    General Austin. I think that----
    Chairman Levin. That is a question which you are obligated 
to answer under the commitments that you have made to this 
committee and under our rules.
    General Austin. Right. Thank you, Senator. As I said 
earlier, I do believe that Ambassador Jeffrey and his team can 
provide adequate security for their elements that they'll have 
remaining. I do believe also that it can be provided better 
with the help of U.S. forces. I also believe that, as I stated 
earlier, that the ISFs will have gaps in their capabilities to 
defend themselves in the future. Certainly if they request and 
our government agrees to provide assistance, then certainly I 
think that is absolutely the right thing to do.
    Chairman Levin. You say it's always true that our troops 
can provide better security and I think as a military man 
that's understandable. But that's not my question, whether we 
can provide better security than contractors can provide. My 
question is what is your personal and professional military 
view as to whether or not our policy is correct to remove all 
of our forces as provided for in that agreement by the end of 
this year? If you disagree with that policy, you better say so 
right now.
    General Austin. My personal opinion is again I think the 
Iraqis will require further assistance.
    Chairman Levin. Military combat assistance on the ground 
after the end of this year?
    General Austin. Assistance to develop their capabilities.
    Chairman Levin. That could be training and equipment.
    General Austin. That would be training and equipment.
    Chairman Levin. I'm asking you beyond that. I'm asking you 
whether or not our decision, President Bush's decision, 
implemented by agreement, to remove all of our ground forces by 
the end of this year is the right decision for us to make? Or 
do you believe it's wrong and we should offer to keep our 
troops there whether or not we get a request?
    General Austin. I think we should only offer to provide 
assistance if requested by the Iraqi Government, Senator.
    Chairman Levin. Then what would your recommendation be if 
there were such a request, right now?
    General Austin. It would be based upon the things that they 
requested assistance for or with. If that's training on their 
counter-terrorist forces, combined arms training, training or 
assistance with logistical support or whatever it is, it would 
be my responsibility to look at what's being asked for and what 
we agree to do and then provide an assessment to my leadership 
on what that would require in terms of forces.
    Chairman Levin. I'm going to ask you that question again 
for the record, because I think it's incumbent on you to give 
us an answer to the question that I ask. I'll ask it of you for 
the record, and then you can decide whether or not to respond 
to that question that I ask you. Okay?
    General Austin. Yes, sir.
    Chairman Levin. Now, there's another unresolved issue, 
which is the future of a group that's at Camp Ashraf, which is 
an Iranian dissident group. Ambassador, I want to know whether 
or not you believe that the Government of Iraq has the 
obligation to provide adequate protection for these people and 
whether or not they are doing it and whether you are confident, 
if they are providing adequate protection, that they will 
continue to do so after December.
    Ambassador Jeffrey. First of all, Mr. Chairman, they do 
have obligations both under international law and in a specific 
written agreement with us from 2008 to both provide adequate 
humanitarian protection and care of these people and not to 
force them to go to a country where they could legitimately 
expect to be mistreated.
    The Iraqis generally are providing adequate security and 
protection for these people. We have had a number of 
unfortunate incidents. We are on this. The United Nations and 
we go up there every week. We are in constant contact with the 
Iraqis and we talk to them about this all the time.
    Chairman Levin. How confident are you that they're going to 
provide protection after December?
    Ambassador Jeffrey. I absolutely think that they'll 
continue to provide security. I mean, there are no U.S. forces 
there, Senator, and I don't think that whether we are present 
or after we're gone will change their position. The 
international community has certain basic expectations of all 
members of the international community and one of them is not 
to mistreat people who are in these conditions.
    Chairman Levin. Can you give us a confidence level? Are you 
very confident they're going to provide protection or somewhat 
confident?
    Ambassador Jeffrey. I'm confident. On a scale of not 
confident to very confident, I'm confident.
    Chairman Levin. On a scale?
    Ambassador Jeffrey. As I said, confident would be one level 
below very confident.
    Chairman Levin. Alright.
    On the question of violence against religious minorities, 
we met with leaders of the Iraq Christian community. They're 
very concerned. You two are very concerned as well, I believe. 
Give us your assessment of the situation, but also whether or 
not Iraq is training units comprised of religious minorities 
who can be deployed to the areas where they come from and where 
their respective communities reside in order to provide 
security? Can you give us an answer to both of those questions?
    General Austin. Yes, sir. I'll take the last question 
first. The prime minister has directed that 500 Iraqi 
Christians be hired and incorporated into the MOI to provide 
additional assistance in protecting the Christian 
neighborhoods.
    Chairman Levin. Villages and communities?
    General Austin. That's right, Senator. These 500 will be 
really employed across the country from Mosul to Baghdad and in 
other places. That hiring process is taking place. Initially 
there were some applicants that were above the age limit and 
the prime minister has come back and offered an age waiver for 
those applicants. We expect to see them on board in about a 
week or so.
    Chairman Levin. Ambassador?
    Ambassador Jeffrey. Senator, on my list of things that make 
me optimistic, I would say that the reaction across the board 
in Iraq to the attack on the church on the 31st of October is 
one of those things that make me feel best about the future of 
Iraq in terms of an inclusive society that can deal with 
violence and can deal with diversity.
    Everybody across the board has been magnificent in 
outreach. They followed that up with concrete actions. We have 
seen, unfortunately, a number of major attacks, particularly by 
AQI, since that time, but no major attack by AQI has been 
conducted successfully on a Christian facility. AQI would like 
to do more, but Christian facilities are getting a lot of 
protection.
    It's also the sincerity and the depth of the reaction of 
people from all religious groups in Iraq to this. The 
Christians really are considered a part of the community by all 
of the other communities in Iraq, and that's a good model for 
people in other places.
    Chairman Levin. I hope that you'll keep that concern on the 
radar screen, there may be good intent, but they're also having 
to deal with some people there who have malicious intent. 
They're going to have to put some resources in there to 
implement their intent to carry out what you say is their 
beliefs, that there is a history there of tolerance and 
participation by the Christian community, that the leadership 
in Iraq want to protect. They need to have the resources in 
order to carry out that intent because of the threat that 
exists there.
    We will stand adjourned, with thanks again to both of you 
for your testimony and for your service. We hope you'll pass 
that along to the men and women with whom you work.
    [Questions for the record with answers supplied follow:]
               Questions Submitted by Senator Carl Levin
           continued presence of u.s. military forces in iraq
    1. Senator Levin. General Austin, in your personal and professional 
military view, and from a purely military perspective, if the 
Government of Iraq requested the continued presence of U.S. military 
forces, including combat forces, would you recommend the approval of 
such a request?
    General Austin. Yes, I would recommend approval for a request for 
U.S. forces that would mitigate the most significant gaps in Iraqi 
military capabilities and address critical missions remaining in Iraq. 
This could include combat forces for counter-terrorism and air 
sovereignty missions, but would be primarily focused on training and 
stability tasks as well as select enabling functions such as logistics 
and intelligence. My recommendation would ultimately be based on an 
assessment of the operational conditions at the time of the request. 
The President has been clear on the U.S. objectives for Iraq: a 
sovereign, stable, self reliant Iraq that is just, representative and 
accountable and that provides neither support nor safe haven to 
terrorists. I believe that a continued U.S. military presence in Iraq 
would significantly reduce the risk to these objectives.

                     security services contracting
    2. Senator Levin. Ambassador Jeffrey, in September 2010, the 
Department of State (DOS) notified eight companies that they could 
compete for their private security work under the Worldwide Protective 
Services (WPS) contract. One of those companies was International 
Development Solutions (IDS), a joint venture that is 49 percent owned 
by the company known as Blackwater. In 2007, after the tragic shooting 
at Nisour Square by Blackwater guards, Blackwater was reportedly banned 
from operating in Iraq. Will IDS, which is 49 percent owned by 
Blackwater, be eligible to compete for DOS security contracts in Iraq?
    Ambassador Jeffrey. The WPS contract was competed in accordance 
with the Federal Acquisition Regulations (FAR). The FAR allows any 
company to submit a proposal in response to an acquisition process 
based on full and open competition. During the evaluation process for 
the WPS base contract, DOS performed a review of all proposals to 
confirm that they met the minimum criteria established by the WPS 
contract requirements. This review included a process to determine 
whether any companies had been suspended or debarred from the award of 
Federal contracts; IDS, despite Blackwater's 49 percent ownership, was 
determined eligible to bid on the base contract and was one of the 
eight awardees. IDS submitted a proposal for both the Baghdad and 
Basrah task orders; however, they did not meet the licensing 
requirements and their proposals were not reviewed during the Technical 
Evaluation Panels.
    Each task order awarded under the WPS base contract, including the 
five in Iraq, are evaluated separately and include specific 
requirements regarding licensing in the country where services are 
being performed. Companies that do not meet the minimum mandatory 
requirements are not eligible for award. Since IDS does not currently 
hold a license to operate in Iraq, it does not meet the minimum 
mandatory requirements for the Iraq task orders.
    On December 17, 2010, USTC Holdings LLC acquired Xe Services and 
its core subsidiaries. As part of the transaction, USTC Holdings will 
acquire the Xe companies that provide domestic and international 
training, as well as security services. As one of Xe's core operating 
subsidiaries, U.S. Training Center was included in this transaction and 
is now owned by USTC Holdings. USTC Holdings will be managed by a board 
appointed by the equity owners, which will include independent, 
unaffiliated directors. The change in ownership does not have any 
impact on IDS's contract with DOS.

special inspector general for iraq reconstruction access to information
    3. Senator Levin. Ambassador Jeffrey, in its last quarterly report, 
the Special Inspector General for Iraq Reconstruction (SIGIR) raised 
concerns regarding the DOS's actions that would have the effect of 
restricting SIGIR's access to information relating to reconstruction 
activities in Iraq. The report also lists a number of SIGIR requests 
for information on the status and funding of reconstruction 
responsibilities that DOS has declined to answer, including:

         The status of life-support contracts to provide 
        support to Provincial Reconstruction Teams, embassy branch 
        offices, consulates and other embassy elements carrying out 
        reconstruction activities; and
         The status of embassy vehicle and equipment requests 
        to support the Police Development Program (PDP), embassy branch 
        offices, and consulates.

    Are you aware of SIGIR's concerns regarding its access to 
information regarding the DOS's reconstruction activities?
    Ambassador Jeffrey. Yes, we are aware of SIGIR's concerns. Embassy 
Baghdad has enjoyed a long and collegial relationship with SIGIR. We 
devote extensive effort to answer SIGIR's questions in a timely and 
complete manner. We provided over 300 pages of information in response 
to the 40 questions on the most recent data call and 8 pages of edits 
and comments to the draft report circulated by SIGIR. Assistant Chief 
of Mission for Assistance and Transition Ambassador Peter Bodde meets 
weekly with all of the Inspectors General (IGs) in Baghdad. And he 
ensures that the Embassy responds promptly to ensure timely response to 
SIGIR's quarterly data calls.
    In addition, we have given SIGIR, as well as all the IGs located at 
Post, unprecedented access to information outside of their data calls. 
SIGIR participates in our Country Team meetings and is granted access 
to both unclassified and classified DOS computer systems, which gives 
them unlimited access to our internal documents and classified cables. 
This level of access for an IG organization is simply unparalleled in 
any other post in the world. We have done this because we recognize, 
respect and appreciate the value of SIGIR's institutional knowledge.
    As Congress is aware, we are in a period of transition and, as 
SIGIR noted in its October 2010 Quarterly Report, our assistance in 
Iraq is transitioning from largely reconstruction-based to technical 
assistance and capacity building.
    The 2005 Memorandum of Agreement (MOA) between SIGIR and the DOS 
Office of the Inspector General (OIG) delineates the jurisdiction of 
the two oversight organizations to avoid overlap and duplication. That 
MOA specifically states questions dealing with Embassy operations will 
be addressed by DOS OIG. The Embassy has already responded to DOS OIG 
on transition matters. Because the MOA also directs the parties to 
share information in order to avoid duplication, SIGIR, which has 
previously sourced the Government Accountability Office (GAO) and the 
U.S. Agency for International Development (USAID) IG reports, in fact, 
has access to this information.
      
    
    

    4. Senator Levin. Ambassador Jeffrey, as these reconstruction 
activities transition from the Department of Defense (DOD) to DOS, 
would you agree on the continuing need for SIGIR to have broad access 
to information relevant to its ability to carry out its 
responsibilities to monitor that taxpayer funds are used appropriately?
    Ambassador Jeffrey. The current DOD-managed reconstruction funds 
are from the Commanders' Emergency Response Program and the Iraq 
Security Forces Fund (ISFF). While neither of these funds will be 
transitioned to DOS, civilian assistance activities targeted at Iraq's 
defense and security, for example, will be funded through FMF if 
provided in the fiscal year 2012 budget.
    DOS will continue to work with the relevant oversight agencies, 
including the GAO, USAID IG and DOS OIG, all of which maintain a 
permanent presence in the U.S. Mission in Baghdad, to ensure oversight 
of our programming in Iraq, as we do in embassies across the world.

    5. Senator Levin. Ambassador Jeffrey, will you look into these 
concerns and urge DOS to ensure that SIGIR has full access to the 
information it needs to carry out its oversight responsibilities?
    Ambassador Jeffrey. As noted in the response to question three, 
Embassy Baghdad provides unprecedented access to SIGIR, DOS OIG, GAO, 
USAID IG, the Wartime Contracting Commission, the House Appropriations 
Surveys and Investigation Committee and visiting congressional 
delegations and we will continue to do so. We share the Committee's 
view that oversight is critically important; however, we believe that 
it is also important to avoid duplicative efforts that could result in 
wasted taxpayer dollars, especially in this budget environment. The MOA 
signed by DOS OIG and SIGIR in January 2005 described this division, 
which was put in place to ``avoid duplication of effort, and to 
minimize disruptions to U.S. Mission and Department programs, 
operations, and activities.''
    SIGIR will continue to have access to meetings and to DOS 
unclassified and classified computer systems. We intend to continue to 
respond to all questions thoroughly and in a timely fashion, as related 
to reconstruction activities.
    For other Embassy functions, we will also continue to provide DOS 
OIG, the USAID IG and the GAO with the information they need to carry 
out their oversight activities without overlap.
                                 ______
                                 
            Questions Submitted by Senator Claire McCaskill
           state department oversight of the dyncorp contract
    6. Senator McCaskill. Ambassador Jeffrey, the United States has 
spent approximately $7.3 billion to train, staff, and equip Iraqi 
police forces since 2003. In January 2010, the SIGIR found continued 
weaknesses in DOS's oversight of the DynCorp contract to support police 
training. As a result of those weaknesses, SIGIR reported that more 
than $2.5 billion was vulnerable to waste and fraud. What, if anything, 
has DOS done to account for the questionable funds already expended on 
this contract?
    Ambassador Jeffrey. DOS, through the Bureau of International 
Narcotics and Law Enforcement Affairs (INL), has taken steps to improve 
programmatic contract management and oversight requirements based upon 
INL's initiative and in response to recommendations from the oversight 
community. These improvements include: (1) a comprehensive invoicing 
review process, (2) a substantial number of rejected invoices, (3) 
collected refunds, and (4) the increased number of contract oversight 
personnel.
    In October 2006, the base International Civilian Police (CIVPOL) 
contracts were modified to allow INL to demand repayment for any 
improper payments identified in a reconciliation review conducted in 
Washington, D.C. This ``provisional payment'' modification allows INL 
to reconcile 100 percent of all program invoices for the life of the 
task order. INL currently only makes provisional payment after a 
detailed review of invoice documentation is conducted and the valid 
invoice is certified. INL's tougher management controls have resulted 
in a significant number of rejected invoices (18 percent) and refunds 
totaling $28.9 million as of March 1, 2011, for Iraq. With the 
implementation of this modification, the risk to the U.S Government was 
reduced substantially.
    To facilitate the implementation of the management controls, INL 
significantly increased contract oversight staff. Currently, there are 
nine In-country Contracting Officer's Representatives (ICORs) deployed 
in Iraq, and an additional ICOR's deployment is pending due to the 
completion of training. INL anticipates increasing these staff to a 
total of 15 ICORs by July 2011.

    7. Senator McCaskill. Ambassador Jeffrey, what other steps has DOS 
taken to improve oversight of this contract?
    Ambassador Jeffrey. DOS consistently reviews, adapts, and improves 
programmatic contract oversight. Other improvements include: (1) using 
the Quality Assurance Surveillance Plans (QASP) for contractor 
accountability; (2) standard operating procedures with greater 
specificity for oversight roles and responsibilities; and (3) 
established a comprehensive Invoice Tracking Database.
    To minimize the U.S. government's risk for fraud and mismanagement, 
INL instituted the use of the QASP to systematically ensure that the 
contractor is meeting performance-based requirements. The plan details 
how and when the U.S. government will survey, observe, test, sample, 
evaluate, and document the contractor's performance in accordance with 
the statement of work. By employing the QASP, INL and the contractor 
achieve an understanding of performance expectations and how 
performance will be measured against those expectations.
    ICORs carry out quality assurance responsibilities as specified in 
the QASP on a continuing basis. Also, INL is providing greater 
specificity in ICOR responsibilities as described in the ICOR 
delegation letters and 14 FAH-2 H-100, the Contracting Officer's 
Representative (COR) Handbook. INL drafted standard operating 
procedures for ICORs and is in the process of drawing conclusions 
resulting from our recent field testing of the draft guidance which 
covers: Invoice Validation; Receiving and Inspection; and COR File 
Maintenance. INL continues to refine and update this guidance based on 
the field test results.
    INL developed an Invoice Tracking Database in December 2009, which 
was operational by January 2010. This database currently maintains 
approximately 4,000 invoices and tracks approval and payment status. 
This management tool has a feature for preventing duplicate invoice 
submission, cross-referencing with DOS's Global Financial Management 
System (GFMS), calculating statistical results and producing weekly 
savings reports.

    8. Senator McCaskill. Ambassador Jeffrey, what metrics have been 
put in place to measure whether the overall police training program is 
succeeding?
    Ambassador Jeffrey. DOS, through its Bureau of INL has supported 
USF-I/Iraq Training and Advising Mission's police training mission in 
Iraq since 2004. Therefore, an explanation of the metrics to measure 
success of the current police program to date is something best 
answered by DOD. State will assume responsibility for police 
development in Iraq on October 1, 2011, through its PDP. INL is 
currently working with DOD to draft a robust monitoring and evaluation 
(M&E) program to serve as an integral part of INL's Iraqi rule of law 
program providing oversight, accountability and transparency.
    INL will begin with an assessment of the current status of the 
Iraqi criminal justice sector: its police, corrections, and courts 
system. The assessment will identify the sector's strengths and 
weaknesses and provide contributory factors. This clear-eyed view of 
Iraq's criminal justice sector will not only help define key 
performance indicators for INL's criminal justice program, including 
its PDP, but it will also highlight those areas most in need of 
assistance.
    Once the assessment is completed and the performance indicators 
identified, we will undertake a baseline study to determine the point 
against which all subsequent programmatic activity will be measured. 
INL will hire up to four full-time M&E experts who will work at each of 
its hubs in Iraq to manage daily performance monitoring and conduct 
more robust periodic evaluation. These M&E professionals will report 
back to Washington, permitting regular, up-to-date monitoring of the 
INL Iraqi PDP.

    9. Senator McCaskill. Ambassador Jeffrey, in SIGIR's January 2010 
report, it stated that, according to one official:

          ``[D]uring most of the period DynCorp was billing for Task 
        Orders 1436, 0338, and other task orders awarded earlier in the 
        contract, the sole ICOR was approving all DynCorp invoices 
        without questioning their accuracy. As a result, INL has no 
        confidence in the accuracy of over $1 billion in charges and is 
        now performing a 100 percent reconciliation of all INL-funded, 
        Iraq-related invoices prior to October 2006.''

    What is the current number of ICOR for the contract and is there a 
plan to increase this number further?
    Ambassador Jeffrey. The reference in Question 9 above refers to 
conditions in INL up to October 2006. INL made dramatic changes in 
contract oversight since the earlier days of this task order when only 
one person approved the invoices. Since 2006, INL established a 
contract oversight cadre that involves Washington based COR, COR 
support staff, ICORs in the field, and an entire program office to 
assist with contract accountability.
    Currently, we have nine ICORs deployed in Iraq, and an additional 
ICOR is in training whose deployment is pending. INL anticipates 
increasing these staff to a total of 15 ICORs by July 2011.

    10. Senator McCaskill. Ambassador Jeffrey, how many personnel are 
dedicated to reviewing questioned and unsupported payments for the 
DynCorp task orders on this contract?
    Ambassador Jeffrey. INL currently has 12 invoice reconciliation 
experts reviewing Dyncorps task orders. It is in the process of hiring 
four more; we anticipate all four positions will be filled by June 
2011. The reconciliation team is responsible for both Iraq and 
Afghanistan invoice reconciliations.

    11. Senator McCaskill. Ambassador Jeffrey, are these personnel 
government or contractors?
    Ambassador Jeffrey. The Reconciliation Team will be made up of 16 
government personnel including 7 civil service and 9 personal service 
contractors.

    12. Senator McCaskill. Ambassador Jeffrey, what metrics have been 
put in place to ensure that the government is only paying for 
legitimate charges?
    Ambassador Jeffrey. As the result of the following oversight 
processes, INL has rejected 18 percent of vendors' invoices with 
realized savings of $38 million and the recovery of more than $28.9 
million in refunds for the period 2004 to the present in Iraq.
    ICORs are responsible for the receiving, inspection and acceptance 
of all the goods and materials procured. Before invoices are submitted 
for payment, ICORs in Iraq perform a 100 percent review of contractor 
purchase requests before the requests are submitted for procurement. 
The contractor claims are validated 100 percent for the cost 
reimbursable services and supplies. The ICORs reconcile current 
invoices in-country using an ``Invoice Check List.'' Any discrepancies 
are noted on the check list and then forwarded to Washington for 
further review.
    INL currently utilizes a 14-step process to ensure the U.S. 
Government is only paying for legitimate charges. The steps involved 
include the following: the invoice is sent to the billing office where 
it is logged in and delivered to the invoice examiner; the invoice is 
date stamped and validated; the invoice is reviewed and is determined 
either proper or improper. An acceptance or rejection letter is 
prepared once the determination is made. If the invoice is denied, the 
vendor is notified; the denied invoice is suspended until the vendor 
submits the correct information. Funds are checked in the GFMS for 
availability; and the invoice is approved and logged out.
    INL currently makes only provisional payment after a detailed 
review of invoice documentation is conducted and the valid invoice is 
certified. In October 2006, base CIVPOL contracts were modified to 
allow INL to demand repayment for any improper payments later 
identified in a detailed invoice review conducted in Washington, DC. 
This process includes rigorous controls over program execution and 
invoice payments.

                   state department transition status
    13. Senator McCaskill. Ambassador Jeffrey, in your prepared 
statement, you stated that U.S. Embassy Baghdad was currently taking on 
the following logistical functions: securing sites outside of Baghdad 
and providing security details, administering the Logistics Civil 
Augmentation Program (LOGCAP) contract for U.S. personnel, managing the 
supply lines for food, fuel, and material, operating emergency medical 
facilities, and running in-country and regional air operations.
    Please provide an account of the status of transition of each of 
these functions, including the planning, competition, and execution of 
contracts in support of these functions and whether these contracts 
will be performed by Iraqi companies. How many non-Iraqi (United States 
or third-country national) contractor personnel will be required to 
fulfill these contracts in Iraq?
    Ambassador Jeffrey. Security: The static guard contract for Baghdad 
was awarded in September, 2010. The Baghdad movement security contract, 
and the static and movement security contracts for Basrah, Kirkuk, and 
Mosul were awarded on February 15th of this year. We plan to award the 
movement and security contracts for Erbil on April 15th.
    LOGCAP IV: The solicitation has been issued and proposals are due 
in March.
    Aviation: The aviation program contractor personnel are and will 
continue to be hired through INL's existing aviation operations 
contract.
    Contract Management: DOS's Office of Acquisition Management is 
partnering with the Defense Contract Management Agency (DCMA) to 
develop a comprehensive, country-wide contract management strategy. 
DCMA personnel will supplement DOS contract management personnel on a 
reimbursable basis.
    Medical: The medical solicitation was issued February 11 and an 
award is planned for May 20.
    The movement and static security contracts and the LOGCAP IV 
contract were competed only among American companies, though this does 
not mean that they will employ only Americans. As the solicitation for 
the medical contract has just been issued we do not know which 
companies will bid and whether or not any Iraqi companies plan to 
participate. We do not have a breakdown of U.S., third control 
national, and Iraqi personnel on these contracts because they have 
either just been awarded or have yet to be awarded.

    14. Senator McCaskill. Ambassador Jeffrey, who will be responsible 
for the security for movements outside Baghdad, which is currently 
conducted by U.S. Forces-Iraq (USF-I), after the transition? Please 
provide an explanation of the expected roles and responsibilities of 
U.S. Government personnel and contractors, and an estimate of the 
number of contractors beyond those currently in place in Iraq who will 
be required to provide security for movements outside of Baghdad.
    Ambassador Jeffrey. The Protective Security Detail (PSD) program in 
Iraq is the responsibility of DOS's Bureau of Diplomatic Security (DS) 
through Regional Security Office (RSO) Baghdad. PSDs are primarily 
staffed by DS WPS contract personnel under the operational control of 
direct-hire DS Special Agents and/or Security Protective Specialists 
(collectively, DS personnel). Contracts for WPS personnel must and do 
meet government of Iraq requirements.
    DOS, DS managed PSD program already operates in Iraq in Baghdad and 
Erbil, and in the 2004-2006 period also operated in Hillah, Mosul, and 
Basra. After the transition this program will extend to sites 
throughout Iraq under Chief of Mission security requirements.
    RSO Baghdad manages all protective security programs at Post, 
including establishing policies and procedures for PSD movements 
outside secure areas. DS personnel direct PSD operations, including 
serving as agents in charge of PSDs operating in the field. WPS 
contract personnel conduct site advances and secure venues prior to the 
PSD's arrival, drive armored vehicles, and staff positions in vehicles, 
walking formations, and quick-response force teams. Qualified 
contractor personnel also serve on PSDs as emergency medical 
technicians.
    Outside of Baghdad, DS plans to use 540 WPS contract personnel to 
support PSD movements in the cities of Erbil, Basra, and Kirkuk.

    15. Senator McCaskill. Ambassador Jeffrey, will contractors be 
driving Mine Resistant Ambush Protected (MRAP) vehicles? Flying 
helicopters? Please provide an estimate of the number of contractors 
required to operate vehicles which are currently provided by USFI.
    Ambassador Jeffrey. Current planning envisions using MRAPs for the 
secure movement of personnel in extremely non-permissive environments. 
MRAPs also provide enhanced capabilities to extract personnel in 
emergency situations, conduct emergency medical evacuations, and 
recover ground and air assets. DS direct-hire personnel and WPS 
contractor personnel already programmed for Iraq security operations 
will be trained to drive and operate MRAPs. Approximately 12 additional 
personnel working under the new LOGCAP contract for logistical support 
will be needed to provide the specilized skills and qualifications 
required for MRAP maintenance, repair, and training.
    Helicopters support a broad range of mission critical operations, 
including transporting personnel safely throughout Iraq, supporting 
vital engagement, aid, and assistance programs, and providing emergency 
response capabilities. It should be noted that Embassy Baghdad is 
already operating an extensive aviation program and Embassy aircraft 
are flown and maintained by contractors. The number of contractors that 
will be needed to meet expanding mission requirements is not linked to 
USF-I.
    At this time it is estimated that a total of 636 contractor 
personnel will be needed in-country to support future Embassy air 
operations in Iraq. This total number is an increase of approximately 
400 personnel over the current staffing. This figure will be adjusted 
as planning continues moving forward and air assets and operations come 
on line.

    16. Senator McCaskill. Ambassador Jeffrey, during the hearing you 
testified that you currently have 2,700 security contractors working in 
Iraq. You stated after the transition that that number will increase to 
5,000 in addition to the police training mission and the Office of 
Security Cooperation-Iraq. What procedures will the embassy use to vet, 
hire, and monitor these thousands of private security contractors?
    Ambassador Jeffrey. The WPS contract requires all vendors to vet 
all prospective employees prior to their submission to DOS for 
consideration. Each vendor has its own screening and vetting process, 
but all must include a criminal background check, medical screening, 
and verification of prior employment.
    Following the completion of contractor vetting, the vendor may 
nominate an individual for employment under the WPS contract. WPS 
companies are required to submit a biographic review package to the DS 
program office, including a resume with detailed work history and any 
supporting documentation (e.g., Military DD 214 or paramedic 
certification or medical license). The program office then reviews the 
information against the contract requirements for the specific position 
or labor category. Additionally, the program office reviews its 
internal records to determine whether the prospective employee has an 
employment history under the previous two Worldwide Personal Protective 
Services contracts (WPPS I and II), or the Baghdad or Kabul Embassy 
Security Force (BESF/KESF) contracts. Should this review determine an 
individual is ineligible for employment under any of the above 
contracts the program office denies the biographic review package and 
the vendor is notified. Once the review process is completed and an 
individual's experience is determined to meet contract requirements, an 
approval is sent back to the vendor to be included in a follow-on 
request for a security clearance.
    Following successful biographic review and approval, companies 
submit forms for a Government background investigation to DS. All 
contractor personnel in Iraq are required to possess either a security 
clearance (Top Secret or Secret, depending on position) or a Moderate 
Risk Public Trust certification, for which investigative standards are 
similar to a Secret security clearance but which does not allow access 
to classified material. Additionally, local nationals are investigated 
by the Embassy's Regional Security Office and undergo a polygraph 
examination as part of their vetting process.
    Following the completion of vetting, training, and deployment of 
PSC personnel, DOS employs an active monitoring and oversight program 
for all PSCs in Iraq. Many of the changes and lessons learned under the 
WPPS II, BESF, or KESF contracts have been incorporated into the new 
WPS contract, which was awarded in September 2010. Some of those 
oversight controls include: requiring that a direct-hire DS employee 
accompany PSDs; hiring additional personnel to provide full-time 
contract oversight; having DS personnel reside in off-site contractor 
housing facilities; installing video recording and tracking systems in 
vehicles; strengthening the Mission Firearms Policy on the use of 
force, including the deployment of additional, less-than-lethal 
equipment fielded to minimize the need for deadly force; adding 
interpreters in the majority of motorcades; and implementing a revised 
standards of conduct policy, including a ban on alcohol.
    Finally, all security contractor firms including those under the 
WPS contract must meet Government of Iraq requirements.

    17. Senator McCaskill. Ambassador Jeffrey, under what jurisdiction 
will employees of the PSCs that are U.S. citizens be under with respect 
to criminal or civil violations?
    Ambassador Jeffrey. U.S. citizens employed by private security 
companies in Iraq are subject to Iraqi criminal and civil jurisdiction, 
and will remain so after the transition. They may also be under the 
jurisdiction of the United States, under certain circumstances. The 
Military Extraterritorial Jurisdiction Act (MEJA) extends 
extraterritorial jurisdiction to cover DOD employees and contractors, 
as well as employees and contractors of any other Federal agency, to 
the extent such employment relates to supporting the mission of DOD 
overseas. Additionally, certain offenses enumerated in the U.S. 
criminal code include provisions extending jurisdiction to acts 
committed outside the United States.
    DOS is fully committed to ensuring that U.S. contractors who are 
accused of committing serious crimes in Iraq are investigated and, when 
warranted, fully prosecuted. DOS supports legislation that would 
clarify U.S. extraterritorial jurisdiction and extend resources to 
prosecute such persons for serious crimes committed overseas, in a 
manner consistent with international law.
    U.S. citizens employed by private security contractors in Iraq may 
also be subject to the jurisdiction of U.S. courts for civil matters, 
depending on a number of factors including the claim at issue and 
whether the court has personal jurisdiction over the individual.

    18. Senator McCaskill. Ambassador Jeffrey, under what jurisdiction 
will employees that are third country nationals (TCN) be under with 
respect to criminal or civil violations?
    Ambassador Jeffrey. TCNs employed by private security companies in 
Iraq are subject to Iraqi criminal and civil jurisdiction, and will 
remain so after the transition. They may also be subject to the 
jurisdiction of the state of their nationality, depending on the laws 
of that state. Under certain limited circumstances, TCNs may be subject 
to the extraterritorial jurisdiction of the United States, including 
under the MEJA or by operation of a U.S. statute extending jurisdiction 
to offenses occurring outside the United States.
    TCNs employed by private security companies in Iraq may also be 
subject to the jurisdiction of U.S. courts for civil matters, depending 
on a number of factors including the claim at issue and whether the 
court has personal jurisdiction over the individual.

    19. Senator McCaskill. Ambassador Jeffrey, will all PSC be citizens 
of either the United States or Iraq?
    Ambassador Jeffrey did not respond in time for printing. When 
received, answer will be retained in committee files.

    20. Senator McCaskill. Ambassador Jeffrey, will the PSC be afforded 
diplomatic status? If not, what legal protections will exist to 
preclude or prohibit Iraqi prosecution of alleged crimes committed by 
the PSC?
    Ambassador Jeffrey did not respond in time for printing. When 
received, answer will be retained in committee files.

                    u.s. military transition status
    21. Senator McCaskill. General Austin, during the hearing you 
testified that the U.S. military is transferring some equipment to the 
DOS, it is transferring or selling some equipment to the Iraq military, 
and it is returning some equipment to the United States. Given the 
sheer volume and quantities of U.S. military equipment remaining in 
Iraq and the recapitalization efforts being made by the DOD as a result 
of a decade at war, there must be thorough accountability of all 
equipment and weapons. Concerning the transfer of military equipment to 
the Iraqi military, what office or person decides what is transferred 
by way of a grant and what equipment is sold?
    General Austin. U.S. military equipment is transferred to the Iraqi 
military via three programs: Foreign Military Sales (FMS), ISFF and the 
U.S. Equipment Transfer to Iraq (USETTI) program.
    USETTI is a program that is in existence as a result of the DOD 
Report on the Transfer of Defense Articles and the Provision of Defense 
Services to the Militaries and Security Forces of Iraq and Afghanistan, 
submitted to the Senate Committee on Armed Services on 5 April 2010. 
The program authorizes the Secretary of Defense to grant both non-
Excess Defense Articles, under section 1234 of both the National 
Defense Authorization Acts for Fiscal Years 2010 and 2011, and Excess 
Defense Articles, under section 516 of the Foreign Assistance Act of 
1961 with congressional notification completed on 16 June 2010. The 
Defense Security Cooperation Agency is the primary office that decides 
what is transferred as a grant.

    22. Senator McCaskill. General Austin, please provide a list of 
specific U.S. military documents, directives, or decision papers that 
are guiding the FMS/Foreign Military Financing (FMF) of U.S. military 
equipment being transferred, sold, granted, or given to the Iraqi 
Government.
    General Austin. FMS, whether funded by the Government of Iraq or 
the FMF program, are conducted in accordance with DOD 5105.38-M, the 
Security Assistance Management Manual. This document provides specific 
and detailed procedures to guide both FMS and FMF processes. The FMF 
program is just beginning in fiscal year 12 as a replacement for ISFF 
activities. The FMS program in Iraq has existed since 2005, and has 
evolved over time as a result of the changing tactical and strategic 
environment in Iraq.
    The current guiding principles for equipment transferred, sold, 
granted or given to Iraq begin with the Security Agreement and 
Strategic Framework Agreement signed on 17 December 2008. Article 27 of 
the Security Agreement, Deterrence of Security Threats, and Section III 
of the Security Framework Agreement, Defense and Security Cooperation, 
both provide for mutual cooperation to strengthen the Iraqi military 
and enhance Iraq's ability to defend its sovereign territory. Article 
27 of the Security Agreement specifically includes ``training, 
equipping, and arming Iraqi security forces'' as a means for achieving 
the ability to defend itself from internal and external threats.
    In July 2009, then Multi National Forces-Iraq published ``Iraq: 
Achieving Stability and Enduring Strategic Partnership,'' providing 
guidance for resourcing support to the Government of Iraq to develop an 
enduring strategic partnership through security cooperation. The paper 
provided guidance to achieve the President's stated goals for Iraq: 
maintain internal security and stability, achieve police primacy, 
defend against external aggression, participate in regional security 
partnership, and develop an enduring U.S. security partnership.
    The Center for Army Analysis published an analysis in July, 2009, 
providing recommendations for the size and force structure of the Iraqi 
security forces. The study concluded the Iraqi military required 
modernized equipment, a mix of mechanized and counterinsurgency capable 
forces, rotary wing and fixed wing attack aircraft, and various 
enablers.
    In August 2009 USF-I provided an information paper for the August 
2009 Iraq Planning conference: ``Iraqi Security Forces--Predicting the 
Capabilities and Covering the Gaps,'' to assist leadership in 
determining appropriate resources.

    23. Senator McCaskill. General Austin, please provide a summary 
list of the U.S. military equipment to be transferred, sold, or granted 
to the Iraqi military.
    General Austin. Enclosed is a summary list of the U.S. military 
equipment to be sold under the FMS program and transferred/granted 
under the USETTI program.
    To date we have sold over 152,581 military articles to the 
Government of Iraq with another 1,439 major case articles pending 
delivery completion over the next 3 years. Moreover, under the USETTI 
program we have transferred 6,768 pieces of excess (section 516) and 
non-excess (section 1234) military equipment and will complete all 
transfers no later than 31 December 2011, when the USETTI program 
expires.
       
    
    
                                 ______
                                 
             Questions Submitted by Senator Joe Manchin III
                     iraq security external threats
    24. Senator Manchin. General Austin, you have said that internal 
security in Iraq is the best it's been in years, and even though 
insurgents still carry out attacks there, the Iraqi forces do have the 
abilities to conduct internal defenses, but their bigger challenge is 
in protection against external threats. How do you define or identify 
these external threats or enemies of Iraq?
    General Austin. [Deleted.]

    25. Senator Manchin. General Austin, in your opinion, if Iraq 
cannot stand up to external enemies do you envision that if asked, the 
U.S. military would fill that gap going forward, similar to our 
presence in South Korea? General Austin, if so, in your judgment, how 
many troops and equipment would be needed and for how long?
    General Austin. I personally believe that the military partnership 
model we employ on the Korean Peninsula would not work in Iraq. The 
U.S. forces deployed to the Republic of Korea are arrayed against a 
known enemy and oppressive regime.
    The threats to Iraqi sovereignty are on the horizon. Unlike Korea, 
any commitment of U.S. forces would be arrayed against a capability gap 
existing within the Iraqi security forces. The interdependence and 
scope of these gaps can be a primary ignition source for future 
conflicts in the region. The Iraqi Army will not achieve the full 
capability to defend against external threats prior to the expiration 
of the Security Agreement. Areas of specific concern are a lack of 
integrated air defense and air sovereignty, logistics and intelligence 
fusion, and the ability to conduct combined arms training.
    U.S. forces will focus on strengthening the Iraqi security forces. 
This effort currently includes maneuver training for select Iraqi 
security forces divisions, and FMS cases designed to advise, train, and 
equip. On our current glide path, a large amount of equipment arrives 
just as the U.S. military departs. There will be no capability for the 
Iraqi security forces to conduct combined arms training and employment 
once this equipment is fielded. This is a hindrance to enduring 
security.
    Equally important are the concerns about Iraq's ability to employ 
integrated air defense in order to defend air sovereignty. A nation has 
an inherent right to exercise absolute control and authority over the 
airspace and coastal waters. 85 percent of Iraq's revenue comes from 
exporting oil. These gaps place risk on Iraq's ability to economically 
mature. This capability gap can be addressed through our current 
transition plans, but success will be contingent on the continued 
support of Congress to fund Embassy Baghdad operations over the next 5 
years.
    Finally, the adhesive that keeps everything together is sustainment 
and intelligence fusion capability. The capability to analyze 
intelligence, to share pertinent and actionable information, and then 
complete the loop with actions against malign actors is the foundation 
for enduring security in Iraq. The security environment required the 
Iraqi security forces to grow rapidly which has flooded an immature 
logistics system and forced the Government of Iraq to accelerate 
sustainment efforts. If the Iraqi security forces are going to continue 
to develop as a security force and provide internal security and 
external defense they will have to improve their logistics 
capabilities. In order for progress to be solidified over the next 5 to 
10 years these capabilities must be established and modernized. This is 
the strategic main effort for any U.S. military partnership over the 
next decade.

                   u.s. troop levels post-withdrawal
    26. Senator Manchin. Ambassador Jeffrey, what are your thoughts on 
the full scope of the U.S. commitment to Iraq after the troops 
withdraw?
    Ambassador Jeffrey. Today we have a historic opportunity and a 
critical window to help Iraq emerge as a strategic partner and a force 
for stability and moderation in a troubled region. We cannot afford to 
let the gains we have sacrificed so much for slip away.
    President Obama has clearly articulated our vision for partnership 
with Iraq. We seek a country that is sovereign, stable and self-
reliant, with a government that is just, representative and 
accountable, that denies support and safe haven to terrorists, is able 
to assume its rightful place in the community of nations, and 
contributes to the peace and security of the region.
    The U.S. military has performed admirably, succeeded in an 
extremely tough mission and sustained heavy losses, but now it is time 
to reorient relations to their proper civilian foundation, based on our 
bilateral Strategic Framework Agreement. We need to have platforms 
around the country to carry out key transitional missions for the next 
three to five years. These include stationing political, economic, 
security and other officials in key areas where past experience has 
shown how a small number of Americans, working daily with their Iraqi 
counterparts, can have a disproportionately great impact in helping to 
defuse crises and produce long-term solutions.
    We will also have a robust Office of Security Cooperation in Iraq 
(OSC-I) under U.S. Chief of Mission authority, which will build 
security relationships that develop partner military capabilities for 
self-defense and multinational operations and promote specific U.S. 
interests. In addition, the DOS PDP will play a vital role in helping 
Iraq's Ministry of the Interior develop its capabilities in the areas 
of strategic planning, budget execution, improved border enforcement, 
combating terrorist financing, crime scene exploitation, forensics, and 
human rights.
    Our foreign assistance programs, led by USAID, focus on traditional 
economic, political, and cultural cooperation, and private sector 
development. These programs help strengthen institutions, address 
ethnic and sectarian tensions, and provide economic opportunities for 
Iraq's people. USAID's major focus areas are strengthening the 
agriculture sector, improving health and education, combating 
corruption, and instituting legal and regulatory reform; all essential 
to create new jobs and grow the private sector in Iraq. As Iraq 
develops its oil resources and increases net revenue, we expect it to 
augment its contribution to cost sharing, already taking place on a 
number of assistance programs.

    27. Senator Manchin. Ambassador Jeffrey, what type of U.S. 
involvement will be necessary in order to keep the peace and make our 
investments in nation-building pay off?
    Ambassador Jeffrey. Following the responsible drawdown of U.S. 
military forces at the end of 2011, our involvement in Iraq will 
transition to a strong civilian engagement with Iraq as envisioned by 
the Strategic Framework Agreement. The goal of this civilian presence 
is to carry out our key programs and support our strategy to transition 
to a more robust Iraqi capacity; build a long-term economic, political, 
and cultural partnership; and support Iraq's reintegration into the 
region and the global economy. Key programs during this transition 
include consulates military assistance programs, rule of law and the 
development of the Iraqi police force, assistance for refugees and the 
internally displaced, as well as traditional economic and development 
assistance. All of these build upon our whole-of-government efforts in 
Iraq to date.
    Right now we have a critical window to help Iraq emerge as a 
strategic partner of the United States and a force for stability and 
moderation in a troubled region. However, to achieve these goals, Iraq 
must overcome some very serious challenges, which taken together, have 
the potential to directly affect our national security interests. A 
weak, unstable Iraq could attract international terrorists or open the 
door for Iraq to potentially align with destabilizing actors in the 
region.
    Our programs will help Iraq meet these challenges and moderate 
these risks. We anticipate opening consulates in Erbil and Basrah to 
engage directly on political and economic issues with Iraqis at the 
regional and local levels. Additionally, our OSC-I in the short term 
will help close gaps in Iraqi security forces capabilities via security 
assistance and security cooperation activities, and in the long-term 
will play a critical role in building our strategic partnership with 
Iraq.
    Our foreign assistance strategy in Iraq has evolved over time--
shifting from reconstruction to capacity development in order to 
increasingly enable the Government of Iraq to govern effectively, 
manage its own reconstruction efforts, and promote economic growth.
    Targeted programs that focus on microfinance, improving the banking 
and investment climate, liaising with key ministries and local 
governments to become more effective in the delivery essential 
services, advising the Iraqi parliament on improving its oversight and 
monitoring capacity, monitoring access to justice for vulnerable 
populations, and other anti-corruption, legal and regulatory reforms. 
Without such assistance, a democratic Iraq will be unable to meet its 
own citizen's expectations for a sovereign, stable and self-reliant 
country.
    Our military assistance programs--FMF and International Military 
Education and Training--focus on helping the Iraqis increase the 
capacity and professionalism of their military forces and complement 
the efforts made to date through U.S., Coalition, and Iraqi military 
operations and initiatives. These programs are critical to the U.S. 
objective of engaging with Iraq as a strategic regional partner, 
particularly during this period of substantial turmoil in the region, 
with major implications for Gulf security.
    Finally, our rule of law and PDPs address the most important 
remaining gap in Iraq's internal security--development of a strong and 
professional police force and a judicial system that is effective and 
impartial. Iraq's ability to engage in legal reforms and police 
professionalization will reinforce favorable conditions in which Iraq's 
private sector can thrive and ameliorate the problems mentioned above.
    We must build on the shared sacrifices of both Americans and Iraqis 
to continue the momentum towards a sovereign, stable, and self-reliant 
Iraq while forming a broad and lasting strategic partnership. We cannot 
afford to let the gains our troops have sacrificed so much for in Iraq 
slip away before they are cemented.

    28. Senator Manchin. Ambassador Jeffrey, in 2003, the Bush 
administration said the United States won't be faced with a huge bill 
for reconstruction of post-war Iraq, in large part because Iraq's oil 
wells can be tapped to help defray the costs. Clearly this did not 
occur, with the United States spending billions in Iraq for 
reconstruction. Iraq is known to have the second largest oil reserves 
in the world. What is the current state of Iraq's oil industry and 
revenues, and will their revenues be used to support their police 
forces, education and medical facilities, reconstruction and 
maintenance, and the types of things that can stabilize a country?
    Ambassador Jeffrey. The Iraqi Government spends billions of dollars 
each year on security, reconstruction, and development. In 2009, the 
Iraqi Government spent nearly $8 billion on security and roughly $7.8 
billion on reconstruction and capital investment. Through November 
2010, year-to-date Iraqi Government spending was $7.5 billion for 
security and $8.4 billion for reconstruction and capital investment. 
The 2011 budget includes $12.0 billion for security and $25.7 billion 
for reconstruction and capital investment. This includes over $5 
billion for investment in critical areas such as electricity, public 
works, health, and education.
    The overwhelming majority--nearly 90 percent--of Iraq's projected 
income comes from oil revenue, and Iraq has the fourth largest proven 
oil reserves (115 billion barrels) in the world behind Saudi Arabia, 
Venezuela, and Iran. (In late 2010, the Iraqi Government announced an 
additional 28 billion barrels of reserves, but this increase is not yet 
recognized internationally as proven reserves.)
    Having proven reserves, however, does not translate into the 
immediate ability to produce or export all of that oil. Iraq's 2010 
production average was 2.4 million barrels per day, and some industry 
analysts have predicted that Iraq may exceed 4 million barrels per day 
production by 2015. Iraq faces numerous logistical, bureaucratic, and 
financial constraints to achieving those production levels, however. 
The government must update and build pipeline and export 
infrastructure, and cover significant upfront costs incurred by 
international oil companies. Furthermore, even if Iraq solves its 
logistical and infrastructure problems, Iraq's production could be 
limited by market conditions and the potential re-imposition of an 
Organization of the Petroleum Exporting Countries quota.
    Even with increases in production, Iraq may not see significant net 
revenue increases for 3 to 5 years. The signed contracts state that 
Iraq must pay international oil companies for services rendered and 
some infrastructure and supplementary costs incurred during field 
development. Covering these costs--tens of billions of dollars--upfront 
will have the effect of delaying net revenue increases, and thus the 
Iraqi Government's ability to make significant additions to the non-oil 
investment budget.
    Iraq is still very much a post-conflict developing country facing 
considerable development, human resource, and fiscal challenges. The 
Iraqi Government's fiscal management is improving with each passing 
year, but its available fiscal resources and institutional capacity are 
not yet adequate enough to meet its citizens' demands for basic 
services and infrastructure, or to fully achieve its development goals. 
Nevertheless, we believe the Iraqi Government is fully committed to 
improving stability and prosperity for all Iraqis. With the passage of 
time and the continued development of Iraq's oil and gas sector, 
additional resources will be available that, if properly managed, will 
help enable Iraq to reach middle-income status over the next decade.
                                 ______
                                 
             Questions Submitted by Senator Roger F. Wicker
      special inspector general for iraq reconstruction oversight
    29. Senator Wicker. Ambassador Jeffrey, Iraq's financial system is 
not like our own. Many transactions are conducted using cash which has 
presented some issues for us in the past. Specifically there have been 
numerous cases where money has not been appropriately accounted for, it 
has been embezzled, or it has simply been stolen. The SIGIR has 
investigated such issues and provided accountability since 2004. But I 
understand SIGIR is to stand down upon the transition to civilian 
control of operations in Iraq. How will the DOS ensure taxpayers' 
dollars are well spent and accounted for?
    Ambassador Jeffrey. DOS OIG and USAID IG have oversight of DOS-
managed assistance programs. These IGs have experience monitoring 
traditional assistance programs in embassies worldwide.
    SIGIR was established to provide oversight for reconstruction 
activities in Iraq and now that reconstruction is coming to an end, the 
Embassy will focus on traditional assistance programs and DOS OIG and 
USAID IG will have jurisdiction.
    GAO also maintains a three person office at the Embassy and has 
oversight over all programming and projects, as directed by Congress. 
We have provided--and will continue to provide--access to our GAO 
colleagues on all assistance activities in Iraq.
    On a related issue, the Embassy will continue to provide capacity 
development programming to address corruption. We have an active 
program in Iraq, with the goal of providing training on anticorruption 
activities within the Government of Iraq.

    30. Senator Wicker. Ambassador Jeffrey, who will provide that 
accountability in the absence of SIGIR?
    Ambassador Jeffrey. Mission Baghdad has a long and collegial 
relationship with SIGIR and has appreciated the insights and 
accountability that the audit team in Baghdad has provided over several 
years. DOS OIG and USAID IG also provided oversight over traditional 
assistance programs in Iraq and a multitude of other countries. Both 
offices have a permanent presence in the United States. Mission. 
Additionally, GAO has--and will continue to have--a three person office 
at the Embassy. These three agencies will continue to provide 
oversight.
                                 ______
                                 
             Question Submitted by Senator Susan M. Collins
      information sharing with special inspector general for iraq 
                             reconstruction
    31. Senator Collins. Ambassador Jeffrey and General Austin, the 
information and oversight SIGIR has provided over the last several 
years has been invaluable to my colleagues and I to evaluate the U.S. 
mission in Iraq. The most recent SIGIR quarterly report suggests SIGIR 
has experienced some challenges in obtaining detailed information from 
DOD and DOS in the course of fulfilling its congressionally mandated 
requirements. Would you describe your commitment to be forthcoming in 
providing information to SIGIR for adequate reporting of the transition 
during this year?
    Ambassador Jeffrey. Embassy Baghdad has a long and collegial 
relationship with SIGIR. We answer SIGIR's questions in a timely and 
complete manner. We provided over 300 pages of information in response 
to the 40 questions on the most recent data call and 8 pages of edits 
and comments to the draft report circulated by SIGIR. Assistant Chief 
of Mission for Assistance and Transition, Ambassador Peter Bodde, meets 
weekly with all of the IGs in Baghdad and have a front office staff 
member whose responsibility is to ensure timely response to SIGIR's 
quarterly data calls.
    In addition, we have given SIGIR, as well as all the IGs located at 
Post, unprecedented access to information outside of their data calls. 
SIGIR is included in our internal Country Team meetings and is granted 
access to both unclassified and classified DOS computer systems, which 
gives them unlimited access to our internal documents and classified 
cables. This level of access for an IG organization is simply 
unparalleled in any other post in the world. We have done this because 
we value SIGIR's institutional knowledge.
    As Congress is aware, we are in a period of transition and, as 
SIGIR noted in its October 2010 Quarterly Report, our assistance in 
Iraq is transitioning from largely reconstruction-based to technical 
assistance and capacity building.
    The 2005 MOA between SIGIR and DOS OIG delineates the jurisdiction 
of the two oversight organizations to avoid overlap and duplication. 
That MOA specifically states that questions dealing with Embassy 
operations will be addressed by DOS OIG. The Embassy has already 
responded to DOS OIG on transition matters. Because the MOA also 
directs the parties to share information in order to avoid duplication, 
SIGIR, which has previously sourced GAO and USAID IG reports, in fact, 
has access to this information.
    General Austin. USF-I has enjoyed a strong and effective 
relationship with SIGIR. I fully support the goals of the 
administration and Congress of ensuring valuable oversight of U.S. 
operations in Iraq. Oversight is essential to our success and SIGIR is 
a part of the team. My staff dedicates a significant amount of time and 
effort to ensure SIGIR's requests are supported expeditiously. SIGIR's 
Quarterly Report has a compressed timeline which has made it 
challenging for USF-I to conduct a detailed examination of the 
documents for possible erroneous information.
    The USF-I Inspector General recently met with SIGIR's Baghdad 
Embassy team to discuss current audit procedures and timelines. USF-I 
business rules have been adjusted to better meet these timelines and 
help streamline SIGIR's ability to conduct oversight.

    [Whereupon, at 12:23 p.m., the committee adjourned.]

                                 
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