[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
                  THE FUTURE OF U.S.-MEXICO RELATIONS

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

                                HEARING

                               BEFORE THE

                      COMMITTEE ON FOREIGN AFFAIRS
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                              MAY 20, 2014

                               __________

                           Serial No. 113-167

                               __________

        Printed for the use of the Committee on Foreign Affairs


Available via the World Wide Web: http://www.foreignaffairs.house.gov/ 
                                  or 
                       http://www.gpo.gov/fdsys/




                  U.S. GOVERNMENT PRINTING OFFICE
88-015                    WASHINGTON : 2014
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 
20402-0001



                                 ______
                      COMMITTEE ON FOREIGN AFFAIRS

                 EDWARD R. ROYCE, California, Chairman
CHRISTOPHER H. SMITH, New Jersey     ELIOT L. ENGEL, New York
ILEANA ROS-LEHTINEN, Florida         ENI F.H. FALEOMAVAEGA, American 
DANA ROHRABACHER, California             Samoa
STEVE CHABOT, Ohio                   BRAD SHERMAN, California
JOE WILSON, South Carolina           GREGORY W. MEEKS, New York
MICHAEL T. McCAUL, Texas             ALBIO SIRES, New Jersey
TED POE, Texas                       GERALD E. CONNOLLY, Virginia
MATT SALMON, Arizona                 THEODORE E. DEUTCH, Florida
TOM MARINO, Pennsylvania             BRIAN HIGGINS, New York
JEFF DUNCAN, South Carolina          KAREN BASS, California
ADAM KINZINGER, Illinois             WILLIAM KEATING, Massachusetts
MO BROOKS, Alabama                   DAVID CICILLINE, Rhode Island
TOM COTTON, Arkansas                 ALAN GRAYSON, Florida
PAUL COOK, California                JUAN VARGAS, California
GEORGE HOLDING, North Carolina       BRADLEY S. SCHNEIDER, Illinois
RANDY K. WEBER SR., Texas            JOSEPH P. KENNEDY III, 
SCOTT PERRY, Pennsylvania                Massachusetts
STEVE STOCKMAN, Texas                AMI BERA, California
RON DeSANTIS, Florida       ALAN S. LOWENTHAL, California
TREY RADEL, Florida--resigned 1/27/  GRACE MENG, New York
    14 deg.                          LOIS FRANKEL, Florida
DOUG COLLINS, Georgia                TULSI GABBARD, Hawaii
MARK MEADOWS, North Carolina         JOAQUIN CASTRO, Texas
TED S. YOHO, Florida
LUKE MESSER, Indiana

     Amy Porter, Chief of Staff      Thomas Sheehy, Staff Director

               Jason Steinbaum, Democratic Staff Director



                            C O N T E N T S

                              ----------                              
                                                                   Page

                               WITNESSES

The Honorable Roberta S. Jacobson, Assistant Secretary, Bureau of 
  Western Hemisphere Affairs, U.S. Department of State...........     6
The Honorable William R. Brownfield, Assistant Secretary, Bureau 
  of International Narcotics and Law Enforcement Affairs, U.S. 
  Department of State............................................    16
Ms. Elizabeth Hogan, Acting Assistant Administrator, Bureau for 
  Latin America and the Caribbean, U.S. Agency for International 
  Development....................................................    24

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

The Honorable Roberta S. Jacobson: Prepared statement............     9
The Honorable William R. Brownfield: Prepared statement..........    18
Ms. Elizabeth Hogan: Prepared statement..........................    26

                                APPENDIX

Hearing notice...................................................    58
Hearing minutes..................................................    59
The Honorable Ileana Ros-Lehtinen, a Representative in Congress 
  from the State of Florida:
  Letter from Members of Congress to the Honorable Jesus Murillo 
    Karam, Procuraduria General De La Republica, Embassy of 
    Mexico, dated May 7, 2014....................................    61
  Letter from Members of Congress to the Honorable John F. Kerry, 
    United States Department of State, dated May 14, 2014........    64
The Honorable Gerald E. Connolly, a Representative in Congress 
  from the Commonwealth of Virginia: Prepared statement..........    66


                  THE FUTURE OF U.S.-MEXICO RELATIONS

                              ----------                              


                         TUESDAY, MAY 20, 2014

                       House of Representatives,

                     Committee on Foreign Affairs,

                            Washington, DC.

    The committee met, pursuant to notice, at 10:11 a.m., in 
room 2172 Rayburn House Office Building, Hon. Edward Royce 
(chairman of the committee) presiding.
    Chairman Royce. This hearing will come to order. We will 
ask all the members if they can take their seats at this time. 
This hearing is on the future of U.S.-Mexico relations. And 
today, as we look at the future of U.S.-Mexico relations, we 
have witnesses that we will hear from shortly. But before we 
do, I am going to make an opening statement and then the 
ranking member of this committee, Mr. Eliot Engel of New York, 
will make his opening statement.
    Despite our strong cultural ties, our relationship with 
neighboring Mexico has never received the sustained attention 
from Washington that that relationship deserves.
    This committee is working to change this. In December, 
Chairman Salmon's Western Hemisphere Subcommittee held an 
important field hearing in Arizona on facilitating trade 
between the two countries. And Ranking Member Eliot Engel has 
had a sustained interest in the western hemisphere, 
particularly in U.S.-Mexico relations. We will all be watching 
Secretary Kerry's trip to Mexico City with interest.
    And this partnership is very important to both countries' 
economic competitiveness and very important to the standard of 
living of people in this hemisphere. As a top trading partner, 
trade in goods and services with Mexico tops a $\1/2\ trillion 
a year, supporting millions of American jobs. With structural 
reforms underway in Mexico, this could increase significantly. 
The High Level Economic Dialogue should advance border 
management and trade efficiency. But most of all, a successful 
conclusion of the Trans-Pacific Partnership negotiations, which 
includes both countries and of course Canada--many countries in 
East and South Asia, many countries along that western side of 
South America--that partnership would spur economic growth 
across a region that represents 40 percent of the entire global 
trade.
    A particular area of growing significance of course is 
energy. Mexico is one of the 10 largest oil producers in the 
world. The United States next year will be number one, but 
Mexico is in the top ten. And it is one of the largest sources 
of U.S. oil imports. Last December, Mexico announced historic 
energy sector reforms, ending the 75-year state monopoly, 
PEMEX. And this committee will be watching closely as Mexico 
finalizes these reforms; which are expected to result in a 
large and productive influx of private capital, technology and 
expertise. If done right, this will allow Mexico's energy 
sector to thrive; improving U.S. energy security by creating a 
more reliable source of oil from our close southern neighbor.
    This committee played a key role in the passage of the 
U.S.-Mexico Transboundary Hydrocarbons Agreement, paving the 
way for greater energy exploration. As a Mexican official told 
committee staff in Mexico City last week, Mexico wants to work 
with the U.S. and Canada to help North America achieve energy 
independence.
    Of course the biggest threat to Mexico's success is the 
ongoing threat of violence from drug cartels and from criminal 
organizations tied to those cartels. U.S. efforts with Mexico 
to tackle these transnational criminal organizations must be 
monitored and improved. After taking a post-election pause to 
consider and review Mexico's national security policy, and with 
a lot of U.S. aid sitting in the pipeline, it appears that the 
Pena Nieto administration will continue partnering closely with 
the U.S. Both countries have an interest in reducing the 
capacity of the cartels. February's joint operation between 
Mexico and U.S. authorities to take down Joaquin ``El Chapo'' 
Guzman was a key success in this partnership.
    Mexicans are hopeful that they are witnessing a new era in 
their country. And under this new administration, reforms 
already passed in Mexico are proving that our southern 
neighbors are serious about liberalizing and modernizing 
institutions. These improvements in trade and investment should 
improve our relations.
    And I will now turn to the ranking member for any comments 
that he may have.
    Mr. Engel?
    Mr. Engel. Chairman Royce, I would like to begin by 
thanking you for holding today's hearing. I have been focused 
on the importance of U.S.-Mexico relations for many years, and 
I appreciate your willingness to bring this issue before the 
committee.
    Once characterized by mutual mistrust, U.S. and Mexico 
relations are now stronger than ever. I am pleased that the 
Obama administration has prioritized our partnership with 
Mexico from the very start, and I am happy to see that 
Secretary Kerry is continuing our high level engagement with 
his trip there tomorrow.
    Today our two economies are tied more closely together than 
ever before. Mexico is the second largest destination for U.S. 
exports and the third largest source of imports. Six million 
American jobs rely on commerce with our southern neighbor. The 
impact of our economic partnership can be felt in every part of 
our nation. In 2013, Mexico was the eighth largest market for 
exports from my home state of New York with $2.2 billion of 
goods exported from New York to Mexico.
    I continue to be impressed by Mexican President, Enrique 
Pena Nieto. Since taking office in December 2012, he has worked 
across party lines to pass historic political and economic 
reforms particularly in the country's energy sector. As a 
result of Mexico's reforms, Moody's upgraded its credit rating 
to investment grade in February. This makes Mexico the only 
Latin American country other than Chile to obtain this rating.
    I am also very pleased that the Mexican Congress recently 
passed a law that will enable civilian courts to try cases 
involving alleged human rights violations committed by soldiers 
against civilians. Previously, these cases were tried in 
military courts.
    Let me also say that the new measures to protect human 
rights, to protect their advocates and journalists, represent 
an important step forward. This is a real challenge, and Mexico 
remains a dangerous place for those working to shine a light on 
abuses, corruption, and crime. I urge the Mexican Government to 
speed up its implementation of these measures. I also urge the 
State Department to provide direct funding for this effort to 
help build a safe environment for these men and women doing 
such important work.
    As our witnesses know, I have been a supporter of the 
Merida Initiative since its inception. But, I have also made it 
clear that we have certain domestic obligations under the 
Merida Initiative that demand greater U.S. attention. Firstly, 
we must do much more to stop the illegal flow of firearms from 
the United States to Mexico.
    In 2009, the Government Accountability Office released a 
report that I commissioned on this issue. It showed that 87 
percent of the firearms Mexican authorities seized and traced 
between Fiscal Year 2004 and Fiscal Year 2008 originated in the 
United States. Today, I am sending a letter to the GAO 
requesting a follow-up report reviewing U.S. efforts to combat 
firearms trafficking to Mexico.
    Secondly, the enormous U.S. demand for illegal drugs fuels 
violence in Mexico. In 2012, there were approximately 24 
million illicit drug users in the United States. While I am 
pleased by the Obama administration's efforts to invest in drug 
prevention and treatment programs, we must continue to do more 
to stop illegal drug use in our country.
    Thirdly, we must do our part to cut off funding to 
transnational criminal organizations. This means enforcing our 
anti-money laundering laws and cracking down on U.S. banks that 
turn a blind eye to money laundering. Without taking these 
steps, it will be very difficult to end the terrible violence 
in Mexico that has claimed more than 70,000 lives over the past 
7 years.
    Finally, I would like to emphasize how important it is to 
both of our countries for the House of Representatives to 
swiftly pass comprehensive immigration reform. We need a new 
immigration system that opens the doors of opportunity and 
emphasizes human dignity. Our diversity is one of our country's 
greatest strengths.
    Throughout our history, immigrants have always been an 
indispensable part of the fabric of our society, and we know 
from the number of people reaching our shores every year that 
America remains a beacon of hope and opportunity around the 
world. The time to fix our system is now and we all know that 
if the Senate's bill came to a vote on the House floor this 
afternoon it would be on the President's desk this evening.
    I would like to close by thanking our witnesses for being 
here today, and for their important work in ensuring that our 
U.S.-Mexico partnership remains strong. I know all the 
witnesses. I am appreciative of their hard work and expertise, 
and I look forward to hearing from each of them today.
    So thank you again, Mr. Chairman, for holding this 
important hearing, and thanks so much once again for working in 
such a bipartisan way.
    Chairman Royce. Thank you, Mr. Engel. We want to now go for 
2 minutes to Mr. Salmon, the chair of the Subcommittee on the 
Western Hemisphere.
    Mr. Salmon. Thank you, Mr. Chairman. I want to thank you 
and Ranking Member Engel for convening today's hearing on our 
extremely important bilateral relationship with Mexico. It is 
wonderful to see you again, Secretary Jacobson, Ambassador 
Brownfield, and Ms. Hogan. You have all done so much to 
strengthen our relationship with Mexico and the rest of the 
Americas, and it has been a real pleasure working with you over 
the past year.
    As you know Mr. Chairman, our economic and security 
partnerships with Mexico are vital. Six million U.S. jobs 
depend on our trade with Mexico. That translates into 1 in 24 
jobs here in the United States. Let me repeat that. One out of 
every 24 jobs in the United States is related to exporting to 
Mexico.
    Six hundred and ninety two thousand jobs in your home 
state, Mr. Chairman, in California, depend on this relationship 
with Mexico. My home state of Arizona is the nation's fifth 
largest exporter to Mexico, and over 111,000 Arizona jobs rely 
directly or indirectly on the commercial relationship we enjoy 
with Mexico.
    Unfortunately, border ports of entry face significant 
challenges keeping up with the growth in our two-way trade, 
resulting in wait times that represent a loss of $7.2 billion a 
year. As chairman of the Western Hemisphere Subcommittee, I 
have made trade facilitation a priority and I look forward to 
hearing from our witnesses about how we can continue to address 
this serious challenge.
    Mexico has a growing middle class, impressive resources, 
and some economists have recently projected that the Mexican 
economy will be the fifth largest economy in the world by 2050. 
Reforms passed within the last year to the telecommunications, 
energy, and other sectors, will open up Mexico's economy even 
more, building a more prosperous Mexico while opening markets 
for American manufacturers and entrepreneurs. Meaningful energy 
reforms recently passed will open the sector to foreign 
investment that will allow Mexico to realize its production 
potential, helping to make North America energy self-
sufficient.
    As chairman of the Western Hemisphere Subcommittee, I 
pushed the administration to finally send up the Transboundary 
Hydrocarbons Agreement for ratification and was pleased when we 
passed it into the law late last year. This resulted in 1.5 
million acres of the U.S. Outer Continental Shelf being opened 
for exploration and production, and opened up resources in the 
Western Gap that has been off limits to both U.S. and Mexico. 
We are now on a real path toward regional energy security and 
independence.
    Despite promising news on the economic front, security in 
Mexico continues to affect both of our countries. Our security 
partnership, through the Merida Initiative, has been successful 
in undermining transnational criminal organizations and in 
helping Mexico to reform its justice sector and build a 
capacity of municipal and Federal police forces. However, I 
continue to be concerned that the progress of Merida-related 
programs has slowed during the Pena Nieto administration's 
strategy to pivot global attention away from Mexico's real 
security challenges.
    I agree that there is much more to Mexico than the security 
situation, but when I see that there is nearly $750 million in 
the Merida pipeline, it tells me that there is still a lot of 
work to be done to get our Mexico partners to reprioritize 
security. It is true that Mexico continues to contribute $10 to 
each $1 the U.S. contributes to the Merida Initiative, and the 
capture of El Chapo certainly is another good indication of 
Mexican resolve, but there is still much progress to be had.
    I am eager to hear from Ambassador Brownfield on steps he 
is taking to further cultivate this important security 
partnership, and from Ms. Hogan on USAID's justice reform and 
violence reduction programs. Improving Mexico's economic 
outlook, the security situation, and the rule of law, will have 
a real and direct impact on the U.S. homeland, and will enhance 
our already impressive bilateral commercial relationship.
    Once again, thank you so much, Mr. Chairman, for convening 
what promises to be a valuable hearing on one of our most 
important and productive global partnerships.
    Chairman Royce. I thank the gentleman. We now go to Mr. 
Sires for 2 minutes. He is the ranking member of the 
Subcommittee on the Western Hemisphere.
    Mr. Sires. Thank you, Mr. Chairman. Good morning, and thank 
you to our witnesses for being here today. The U.S. and Mexico 
relationship is amongst the most critical and vibrant for our 
nation's economic and public security. It is also one of the 
most promising and positive relationships in our hemisphere. I 
thank my friend and colleague, Chairman Salmon, for making this 
relationship a central focus of our subcommittee work.
    Our nations share common democratic values, similar desires 
for peace and economic prosperity, as well as nearly a 2,000-
mile border. The U.S. is Mexico's largest trading partner and 
largest foreign investor, while Mexico is the third largest 
U.S. trading partner. In terms of security, both the U.S. and 
Mexico have accepted a shared responsibility as part of the 
Merida Initiative.
    Congress has appropriated more than $2 billion toward the 
Merida Initiative, and the administration has requested $115 
million for Fiscal Year 2015. For its part, Mexico has invested 
nearly $10 for every U.S. dollars deg. committed by 
the U.S. Nonetheless, Mexico remains a major producer and 
supplier to the U.S. of heroin, meth, and marijuana, and is the 
major transit country for more than 95 percent of the cocaine 
sold in the United States. Since 2006, more than 70,000 deaths 
have resulted from drug related crime and violence in Mexico.
    Nearly a year and a half has passed since Mexico's Enrique 
Pena Nieto came into office in December 2012. Since that time, 
President Pena Nieto has assured a series of ambitious reforms 
with pending secondary legislation that could prove significant 
to their success and have a profound impact on U.S. economic 
relations and energy security.
    Skepticism and concerns regarding Pena Nieto's move to 
centralize security policy under ventanilla unica has now 
moderated, and is reflected in the recent successful capture of 
drug kingpin Joaquin ``El Chapo'' Guzman which came about with 
the help of U.S. intelligence. While the escalation of drug 
related violence in the region of Tamaulipas y Michoacan is 
still a concern, I hope Mexico's recent announcement to 
dedicate security resources to those regions will signify an 
ongoing effort to continue combating drug-related criminal 
threats and strengthening local police forces.
    I look forward to hearing about our involvement in Mexico's 
southern border security efforts, and in terms of human rights, 
how we can work with Mexico to further protect journalism, 
human rights advocates, and Central American migrants. I look 
forward to hearing from our panelists on their assessment of 
what we can expect from Secretary Kerry's upcoming visit to 
Mexico and how we can improve our efforts moving forward. Thank 
you.
    Chairman Royce. Thank you, Mr. Sires. Well, this morning we 
are pleased to be joined by representatives of the Department 
of State and the U.S. Agency for International Development. And 
it is good to see our Madam Assistant Secretary. It is good to 
see you again, Ms. Jacobson. And before becoming Assistant 
Secretary of State for the Bureau of Western Hemisphere 
Affairs, she formerly was the Acting Assistant Secretary for 
Western Hemisphere Affairs and formerly served as director of 
Mexican Affairs.
    We also have Ambassador Brownfield with us. He is the 
Assistant Secretary for International Narcotics and Law 
Enforcement Affairs. He was the U.S. Ambassador to Colombia 
from 2007 to 2010, and served overseas in Venezuela, El 
Salvador, Argentina, Switzerland, and in Panama as a temporary 
political advisor to the U.S. Southern Command.
    Ms. Hogan has 25 years of development experience in Latin 
America. Elizabeth, or ``Beth Hogan'' as we know her, is the 
Senior Deputy Assistant Administrator for USAID's Bureau for 
Latin America and the Caribbean. Previously, she served as the 
Director of the Agency's Haiti Task Team, and was Director of 
South American affairs.
    So without objection, the witnesses' full prepared 
statements will be made part of the record, and members will 
have 5 calendar days to submit statements and questions and any 
extraneous material that they may want to put into the record.
    At this point we will begin with Ms. Jacobson. We will ask 
all of the witnesses, if you could, summarize your remarks, and 
then we will go to questions.
    Ms. Jacobson?

   STATEMENT OF THE HONORABLE ROBERTA S. JACOBSON, ASSISTANT 
     SECRETARY, BUREAU OF WESTERN HEMISPHERE AFFAIRS, U.S. 
                      DEPARTMENT OF STATE

    Ms. Jacobson. Thank you Mr. Chairman, Ranking Member Engel, 
and members of the committee. I want to thank you for the 
opportunity to appear here today to testify on U.S.-Mexico 
relations. I am really so gratified, because I think this is 
the largest number of members that we have had at a hearing in 
this committee on Latin America. And I also really want to 
thank the Western Hemisphere Subcommittee, and Chairman Salmon, 
and Ranking Member Sires for their consistent and bipartisan 
support of the U.S.-Mexican relationship.
    Chairman Royce. It is the panel, probably, that brought 
them, Assistant Secretary, so thank you.
    Ms. Jacobson. Our relationship with Mexico is positive and 
successful, and really it is Congress' support that is a 
cornerstone of that success. I am going to speak briefly on 
security and the rule of law because my colleagues will cover 
that in more detail. But, I want to first provide the broader 
context for a relationship that is increasingly global, and 
even more important to the lives and pocketbooks of Americans.
    Our high level of engagement with Mexico underscores the 
importance of the relationship. President Obama has visited 
Mexico five times since taking office, most recently in 
February, while Vice President Biden has gone three times to 
Mexico. Further reflecting the breadth of the relationship, we 
have had Secretaries Johnson, Hagel, Foxx, Lew, Vilsack, 
Pritzker, and Ambassador Froman, all visit Mexico over the past 
year alone, to advance our efforts to support trade, streamline 
regulatory cooperation, and enhance the security of our 
citizens. And, as you all said, my boss, Secretary Kerry, 
travels to Mexico tomorrow.
    The United States and Mexico have integrated our economies 
in ways we could not foresee when NAFTA went into force 20 
years ago; creating good jobs and new opportunities for 
citizens of both countries and increasing our competitiveness. 
The U.S. and Mexican manufacturing economies build products 
together for the North American and global markets.
    The United States welcomes Mexico's focus on economic 
policy reforms. The reforms that are being implemented should 
not only help Mexico build a more productive economy and raise 
living standards, but also create opportunities for Mexican 
firms to improve North American competitiveness. The 
administration is capitalizing on President Pena Nieto's strong 
push into economic development.
    The high level economic dialogue Vice President Biden 
launched last year is moving forward in three areas: 
Competitiveness and connectivity; economic growth, 
entrepreneurship and innovation; and regional and global 
leadership.
    We are working in many of these areas with Canada and 
Mexico, based on our leaders' commitments at the North American 
Leaders Summit in March. People-to-people ties between our two 
countries are vast. Ten percent of all Americans, more than 33 
million, are of Mexican heritage. The Mexican American 
community is a vital part of our culture, our politics, and our 
values, and we are focused on tapping the great potential that 
our people give us.
    We have held five meetings of our Bilateral Forum for 
Education, Innovation, and Research, bringing together 
government, academic, and civil society members to promote 
opportunity, job creation, and development of a 21st century 
workforce. That forum complements the President's 100,000 
Strong in the Americas initiative, to increase student 
exchanges between the United States and countries of the 
Western Hemisphere, including Mexico.
    The President and his cabinet continue to engage with 
Mexican leaders on the administration's vision for 
comprehensive immigration reform that respects our tradition as 
a nation of immigrants as well as a nation of laws. Immigration 
reform would affect Mexico more than any other country, but 
Mexican officials recognize this is a domestic issue for the 
U.S. to debate and decide.
    At the same time, our border is more secure than ever. We 
partner with Mexico to maintain that secure border, which 
facilitates the legal transit of goods and people. Mexico is 
beginning to implement a strategy to better secure its own 
border with Belize and Guatemala to stem illicit flows of 
drugs, weapons, and people.
    We maintain a close partnership with the Mexican Government 
on security and rule of law issues. I will let my colleagues 
describe those programs, but I want to highlight two emblematic 
developments. The February arrest of Sinaloa Cartel leader 
Chapo Guzman, as has been mentioned, was a clear indication, 
through cooperation conducted with trust and shared enterprise, 
that no individual or criminal network is immune from the reach 
of the law.
    Another development was the public announcement, just last 
week, of a comprehensive Mexican Government plan to address 
security in Tamaulipas, which borders Texas. President Pena 
Nieto stated there are no easy solutions or shortcuts to reduce 
violence in the short term, emphasizing long term goals such as 
the rule of law and trust in judicial institutions.
    While the Merida Initiative does not directly fund law 
enforcement operations, it does build capacity. And we know 
that when Mexicans benefit from more effective law enforcement 
and judicial institutions, in areas near or far from our 
border, we benefit as well. In my last visit to Mexico I 
enjoyed frank conversations on human rights, security, and 
improving the lives of our citizens. Mexico wants to work with 
us to achieve the massive potential of our citizens and our 
economies.
    Thank you, Mr. Chairman, and all the members of this 
committee for your time today, and I look forward to answering 
your questions.
    [The prepared statement of Ms. Jacobson follows:]
    
    
    
    
    
    
    
    
    
    
    
    
    
    
                              ----------                              

    Chairman Royce. Thank you Assistant Secretary.
    Ambassador?

  STATEMENT OF THE HONORABLE WILLIAM R. BROWNFIELD, ASSISTANT 
     SECRETARY, BUREAU OF INTERNATIONAL NARCOTICS AND LAW 
         ENFORCEMENT AFFAIRS, U.S. DEPARTMENT OF STATE

    Mr. Brownfield. May I open by thanking you for not drawing 
attention during your introduction to my 3 years as U.S. 
Ambassador to Venezuela, a period and a performance which 
richly merits not being remembered for centuries and centuries 
to come.
    Chairman Royce. Well, I referenced it but I didn't give the 
time frame.
    Mr. Brownfield. Mr. Chairman, Mr. Engel, members of the 
committee, thank you for the opportunity to appear before you 
today to discuss one of our most important relationships in the 
entire world. Assistant Secretary Jacobson has just described 
the larger strategic issues and I will report on the security 
relationship.
    With the arrival of the Pena Nieto administration in 
December 2012, both governments took the opportunity to review 
our security cooperation. We had much to review. Since 2008, we 
have delivered $1.2 billion to support that cooperation, and 
the Government of Mexico has delivered many times that amount.
    Our support has provided training and equipment to 8,500 
justice sector officials and 22,000 police. Civic education 
programs have reached more than 700,000 Mexican students, and 
secure, Federal prison systems have grown from five to 14. The 
Mexican Government has taken down more than 70 major drug 
traffickers, and our contribution of $112 million in border 
detection equipment has resulted in almost $3.8 billion in 
seized illicit goods.
    Our joint review started from a very strong base. Early 
last year, the two governments agreed to maintain four pillars 
to guide our security cooperation: Disrupting organized crime, 
institution building, creating a modern border and building 
strong communities.
    The Government of Mexico released its own 10-point national 
security strategy last August, giving greater priority to crime 
prevention, rule of law, and community development. We agreed 
with these priorities. For our part, we prioritized training 
over equipment and state-level engagement as well as Federal-
level engagement.
    The Mexican Government agreed with these U.S. priorities. 
Since January of this year, our two Governments have approved 
78 new projects valued at more than $430 million. The Mexican 
Government focused these projects on justice sector reform, 
Mexico's southern border, and state-level law enforcement.
    We will work with the Mexican Attorney General's office to 
train prosecutors in the new accusatory justice system, and 
empower law enforcers to fight financial crime. We will provide 
communications equipment and training for customs, immigration, 
border, and narcotics officials along Mexico's southern border, 
through which most illicit product and migrants pass on their 
way to the United States. And we will increase training and 
support for state police academies to allow them to expand 
their reach to state police throughout Mexico.
    Mr. Chairman, I do not need to explain to this committee 
the importance of this security relationship. I am sometimes 
asked when we will see concrete results on the ground from this 
investment. The question is easily answered. First, I note our 
lesson from Colombia. It takes decades to create security 
threats, and it takes time to resolve them.
    But second, there are visible results on the ground. The 
arrest of Joaquin ``El Chapo'' Guzman last February, was the 
most important law enforcement operation since the Colombian 
takedown of Pablo Escobar in 1993. In the past 3 years, the 
homicide rate in the city of Juarez, 300 feet across the river 
from El Paso, has dropped as much as 83 percent. U.S. 
consumption of cocaine and methamphetamines, most of them 
transhipped through Mexico, has dropped nearly 50 percent since 
2007. And U.S. border officials report that at some crossings 
Mexican nationals now constitute a minority of those detained 
for illegal entry.
    Members of the committee, this Congress was bold and 
ambitious when it decided in 2008 to support the Merida 
Initiative. We are not at the goal line yet, but we have 
crossed the 50. Thank you, and I look forward to your questions 
and your guidance.
    [The prepared statement of Mr. Brownfield follows:]
    
    
    
    
    
    
    
    
    
    
    
    
                              ----------                              

    Chairman Royce. Thank you.

      STATEMENT OF MS. ELIZABETH HOGAN, ACTING ASSISTANT 
ADMINISTRATOR, BUREAU FOR LATIN AMERICA AND THE CARIBBEAN, U.S. 
              AGENCY FOR INTERNATIONAL DEVELOPMENT

    Ms. Hogan. Chairman Royce, Ranking Member Engel, and 
members of the committee, thank you for the opportunity to 
discuss USAID's contributions to the Merida Initiative with you 
today.
    Mr. Chairman, as underscored in our new mission statement, 
USAID is partnering to end extreme poverty and promote 
resilient democratic societies. USAID's work with our partners 
in Latin America and the Caribbean, and the region's impressive 
progress over the past several decades, has enabled USAID to 
shift our development approach from providing direct assistance 
toward strengthening countries' capacity to provide for their 
own people.
    In Mexico, USAID's collaboration with the Government of 
Mexico on rule of law and citizen security has three goals: To 
improve the effectiveness of the criminal justice system, 
strengthen the capacities of communities to reduce crime and 
violence, and promote the protection of human rights. To 
achieve these goals, we operate in a genuine partnership with 
our Mexican counterparts. These goals are a matter of national 
security for the United States as well as an economic and 
political imperative.
    Six years ago, Mexico began a transition from the written, 
inquisitorial criminal justice system to the most transparent, 
oral adversarial system. USAID's support to that transition at 
the national level and in 12 of the 32 Mexican states ranges 
from helping to develop legislation to training judges, 
prosecutors, public defenders, and investigative police.
    We are also helping the Mexican Government create and 
strengthen institutions essential to the reform; such as, 
building the capacity of internal training units, victims 
assistance centers, and pretrial service units. To prepare the 
next generation of lawyers and judges, we are assisting 
Mexico's bar associations, promoting professional standards and 
law schools, in curriculum reform and teacher training.
    The transition to a new criminal justice system is already 
producing positive results. Evaluations of the states that have 
advanced the reforms found a significant decrease in acquittal 
rates, a marked decrease in the length of pretrial detentions, 
longer sentences assigned for serious crimes, reduced case 
backlogs, and better assistance for victims.
    To support the Mexican Government's crime reduction 
efforts, we are piloting innovative prevention approaches in 
three of the border cities most affected by violence and 
criminal activity. In Ciudad Juarez, Monterrey, and Tijuana, we 
are developing new models for safe urban spaces, providing life 
and job skills for at-risk youth, increasing educational 
opportunities, and empowering communities to address the root 
causes of crime and violence. We will help the Mexican 
Government build on and replicate the most successful of these 
interventions.
    One of the keys to the success of our Merida activities has 
been the extent to which the private sector has contributed and 
partnered with us. To raise additional resources and ensure job 
training provides the skills that employers need, we have 
partnered with companies like Cisco, Intel, Prudential, and 
CEMEX, to name a few, to train youth from tough neighborhoods 
for jobs in the growing fields of technology and construction.
    We are also helping to spur economic activity in poor 
communities across Mexico by opening up affordable financing 
via the Development Credit Authority. A 2013 partnership 
between USAID, the Mexican financial institution, Velfin, and 
Credit Suisse has unlocked $60 million in private capital for 
local job creators, small- and medium-sized businesses.
    To truly ensure the sustainability of our efforts, we are 
increasingly supporting local organizations to reduce crime and 
violence; such as the Chihuahuan Business Foundation and 
Citizens Committed to Peace who are in Ciudad Juarez, 
Monterrey, and Tijuana. To date, they have supported over 
17,000 at-risk Mexican youth. Our efforts to advance prevention 
by providing viable alternatives to Mexican youth are already 
bearing fruit. One of our employability programs engaged 8,900 
at-risk youth in employment and education activities, and 
approximately 70 percent of the participants have re-enrolled 
in school or gone on to find gainful employment.
    Through the Merida Initiative, USAID is helping the Mexican 
Government to protect journalists and human right defenders who 
expose crime and corruption. Together, we are applying the 
lessons learned from a decade of investments in Colombia to 
enhance similar protection mechanisms in Mexico. We train 
journalists and human rights professionals on the practices, 
tools, and technologies they need to protect themselves and 
their work.
    Mr. Chairman, we are encouraged by many of the steps that 
Mexico has taken to reduce crime and violence. But we also 
recognize that defeating the powerful cartels and the violence 
that they have spawned will take time. We are also encouraged 
by the progress we have seen thus far through our partnership 
with the Mexican Government, private sector, and civil society. 
Their success will make both our countries safer and more 
prosperous. Thank you, and I look forward to your questions.
    [The prepared statement of Ms. Hogan follows:]
    
    
    
    
    
    
    
    
    
    
                              ----------                              

    Chairman Royce. Thank you, Ms. Hogan.
    Let me ask a question of the Ambassador, and it relates to 
the Pena administration's review on security issues. They took 
a step back, took a sort of a new approach. We are over a year 
into the administration there. How do we assess the cooperation 
between the U.S. and Mexico on that?
    And the other aspect of that, as I understand the State 
Department works with the California Attorney General's office 
to help provide oral advocacy training to the prosecutors in 
Mexico and that our L.A. County Sheriff's office hosts a study 
tour for Mexico city police.
    And I was going to ask also how these state-level exchanges 
help improve cross-border relationships at the state level and 
in turn help improve the capacity in Mexico on transnational 
criminal investigations. But, I also wondered about the 
effectiveness of these programs and thought you might have some 
comment on that.
    Mr. Brownfield. Thank you, Mr. Chairman, I just might. May 
I start with your first question, and that is the state of 
cooperation between the United States and Mexican Governments. 
You are correct as always, at the start of this now not-so-new 
government of President Pena Nieto as of the 1st of December 
2012, there was a period where both governments, logically and 
understandably, said let us review what is the nature of the 
cooperation that we have today. I would suggest to you that 
never in the history of mankind has a government come to 
office, a new administration, saying we will continue each and 
every program and policy of our predecessors.
    This process took some time. Much of the year 2013 was 
dedicated to it. We were not sitting on our hands during this 
time. Programs that had already begun were continued through 
that year, but we did in fact not initiate a great many new 
programs. We have reached an agreement on how we will make 
these decisions in the future.
    We have set up our own team based out of our Embassy in 
Mexico City, and the Government of Mexico has established their 
representatives in the Secretariat or the Department of 
Gobernacion, like their presidency ministry, and their foreign 
ministry. They are making decisions. As I mentioned in my 
statement, we have agreements on 78 new projects and nearly 
$438 million worth of projects that will proceed. The message 
that I have for you is that we are now moving ahead at a right 
smart pace in terms of new programs and projects.
    Chairman Royce. And one of these would be the prosecutorial 
training by the Attorney General's office in California?
    Mr. Brownfield. It would fall in that category, Mr. 
Chairman. And if you will allow me to pander ever so briefly, 
and I promise to stop. Since you have opened that door I would 
mention as well, proudly, that we have also partnered with a 
number of other state and local institutions in the United 
States of America for Mexico programs including: The Chicago 
Police Department, Harris County Sheriffs, Houston Police 
Department, State of Maryland Corrections, Los Angeles 
Sheriff's Department, as you mentioned, Portland Police 
Department, Washington State Justice Commission, El Paso 
Sheriff's Department, Albuquerque Police Department, New Mexico 
State Police, California Corrections Department, Colorado 
Corrections, Maryland Corrections, New Mexico Corrections, and 
a group called the Conference of Western Attorneys General, 
which loops in about two-thirds of the attorneys general of the 
United States of America including California.
    Chairman Royce. All this focus on capacity building and you 
deem this to be effective? Very good.
    Mr. Brownfield. In each case obviously focused on their 
area of expertise.
    Chairman Royce. Well, we appreciate that.
    I wanted to go to Assistant Secretary Jacobson with a 
question about the shift in strategy. For 75 years you had a 
parastatal there, PEMEX, and now that state-owned monopoly is 
changing. And I was going to ask you about the energy sector 
there and the changes you might expect following the 
implementation of those major reforms that are underway. And 
maybe ask also if you thought we would see significant foreign 
investment, as well as U.S. investment in the energy industry 
as a result of the reforms.
    Ms. Jacobson. So I thank you, Mr. Chairman. I think one of 
the things that has been so exciting about the reforms, and the 
energy reform obviously has garnered the most attention, are 
opportunities for partnership and investment. Obviously PEMEX 
will remain a state-owned entity and that has been clear 
throughout the reform, and the implementing legislation and the 
secondary legislation is not yet complete. So it is not 
entirely clear how things will play out.
    But, what we hear from U.S. companies of all types, energy 
firms and firms that would support energy contracts, et cetera, 
is that they are very, very interested in the market and they 
are waiting for the reforms to be complete. They are obviously 
very excited about this, very positive about the possibility of 
partnering with Mexican companies and PEMEX itself and what 
possibilities there might be for them to be involved.
    There are also, obviously outside of the oil industry, 
partnerships in renewable energy, other forms of energy with 
U.S. companies for quite awhile. But in the oil industry, there 
are possibilities that didn't exist before.
    Chairman Royce. Thank you, Assistant Secretary. I will go 
now to Mr. Eliot Engel of New York.
    Mr. Engel. Thank you. Thank you very much, Mr. Chairman. As 
the witnesses know, I was an early and strong supporter of the 
Merida Initiative, and since 2008 Congress has appropriated 
over $2 billion in assistance to Mexico through that 
initiative. As large military hardware has been delivered and 
our focus turns toward institution building and justice reform, 
the President's budget requests have decreased for Merida 
funding.
    So I would like to ask each of our witnesses to give us a 
sense of what you think Merida Initiative assistance should 
look like, both in terms of the amounts and types of funding 
over the next 5 to 10 years, say. I want to obviously ensure 
that Mexico receives the funding it needs in this tight budget 
atmosphere. So why don't we start with you, Ms. Jacobson?
    Ms. Jacobson. Thank you, Mr. Engel. I think that obviously 
as you have seen from our requests, the figures have gone down 
over the last couple of years. This was to some extent, I 
think, our expectation along with the Mexicans that those 
numbers would go down. Number one, the Mexicans are able to 
obviously afford a great deal on their own, but number two, as 
we have said and you implied in your question, equipment is 
more expensive than training, which is the area that we are in 
most now.
    I can't recall exactly at this moment the precise total 
figure that we are talking about, whether we are somewhere 
between $100 million and $200 million of assistance at this 
point. I expect that figure to be in that neighborhood and 
trending downward, but slowly, hopefully, over the next few 
years.
    There is still an enormous amount to do, especially as 
Ambassador Brownfield has outlined, as we move into cooperating 
with the Mexican Government on state efforts. Because as we 
know, so much of the law enforcement and the justice efforts 
are at the state level, not just at the Federal level, to fight 
these kinds of crime.
    But I also think it is critically important as Beth pointed 
out, I think the real focus has to be on the communities 
themselves and the justice sector. This is an administration 
that came in very focused on completing judicial reform. That 
is going to make a huge difference on the human rights 
situation and on convicting people and making sure that you are 
only focused on the most important cases and that other cases 
are not always coming to trial. Things are more transparent, 
victims' rights are respected. So I think that is really where 
a lot of the focus needs to be maintained in years ahead.
    Mr. Engel. Anybody else? Ambassador?
    Mr. Brownfield. May I quickly, Mr. Engel, and suggest to 
you, the President's request for Fiscal Year 2015 for 
International Narcotics Control and Law Enforcement was $18 
million. I of course support the President's request. I do note 
that that is down from nearly $148 million the year before.
    I think there are two reasons for this. One, as Assistant 
Secretary Jacobson has just laid out, you have to expect a 
program will start high and then you, the Congress, will hold 
us to a standard to bring it down to a sustainable level in the 
richness and fullness of time.
    And second, as I suggested in my opening statement, we were 
working through a period of adjustment with the new government, 
and during that time we were not spending down at the rate that 
we had in previous years. It would be my hope, Congressman, 
that our request in the year ahead would be at a somewhat 
higher level.
    Mr. Engel. Ms. Hogan?
    Ms. Hogan. I would just underscore a point I made in my 
testimony, in that, we have just begun to tap the enormous 
potential of the private sector to invest in some of these 
programs, and I think that is a win-win situation. By investing 
in workforce development, they are getting better employees and 
we are staving off the opportunity for at-risk youth to move 
into illicit economic activity.
    There is much more that we can do. We know there is a great 
amount of liquidity in the banks and it is not reaching small- 
and medium-sized businesses. Through our Development Credit 
Authority, we are poised to do more of that kind of work and 
unleash that potential, and the private sector has to bring 
more to bear on solving these problems going forward.
    Mr. Engel. Thank you. As I mentioned in my opening 
statement, I believe that U.S. firearms fuel drug violence in 
Mexico. Since 2009, I have pushed for full enforcement of the 
existing U.S. ban on imported firearms, which are not for 
sporting purposes. This was enacted in the 1968 Gun Control 
Act. Frankly, I have been a bit frustrated that the 
administration's not enforcing this or enacting this. This is 
legislation that is already on the books. It was fulfilled 
under both the administrations of President George H.W. Bush 
and President Clinton. It was stopped by President George W. 
Bush, and has not resumed under President Obama, and it has 
been very frustrating.
    I know we were having some discussions and hopefully we are 
moving things along in the right direction. But to me it is 
very frustrating, that although it is on the books and we know 
if utilized will stop the violence, or not stop it but curtail 
it, and that these arms that illegally go to Mexico are fueling 
it, and we are just sitting there and watching it happen when 
we have laws on the books that, in my opinion, could prevent 
it.
    In Mexico, we have used Merida Initiative assistance to 
install Spanish language eTrace to help trace recovered 
firearms, and let me ask Ambassador Brownfield about it. How 
effective has Spanish language eTrace been? How is the 
cooperation, your cooperation with your Mexican counterparts in 
Spanish eTrace? And based on the information you have obtained 
from eTrace, do you know where most firearms recovered in 
Mexico come from?
    Mr. Brownfield. Thank you, Congressman. The eTrace is, in 
fact, a very important part of our security and law enforcement 
cooperation with Mexico and the Mexican Government under the 
Merida Initiative. I would describe our experience with eTrace 
as, initially some concern or speculation on the part of the 
Mexican Government, to what this really was, and whether this 
was a substitute for us enforcing aggressively our own firearms 
licensing and export controls and laws. And then considerable 
enthusiasm for eTrace as it was introduced into the Mexican law 
enforcement community.
    It then dropped in terms of the number of traces called for 
in the course of the year 2013. It is now rising once again. I 
attribute that to, first, the same adjustment of one 
administration to another administration, and second, a 
realization by the new team that this is, in fact, a valuable 
tool. I am optimistic about it. I think this is a very good 
investment. It is not just an investment of the United States 
and Mexico. As you presumably know, we are also having 
excellent success with eTrace in the Caribbean and in Central 
America.
    Mr. Engel. I think my time is over. But I am wondering, 
Ambassador, if you could answer the last question I said, which 
on the information you have obtained from eTrace, do we know 
where most firearms recovered in Mexico come from?
    Mr. Brownfield. Sorry. We know where they come from in 
terms of those which have been processed through eTrace. I 
actually can't give you figures right here and now, but I will 
be happy to give them to you. Those that have actually been 
processed through the eTrace system will, in fact, give us a 
statistical basis to say where their point of origin was.
    Mr. Engel. Thank you.
    Thank you, Mr. Chairman.
    Chairman Royce. Thank you.
    Mr. Rohrabacher?
    Mr. Rohrabacher. I thought you were going to go first, Mr. 
Chairman. Thank you very much. First and foremost, let us be 
very grateful that we have such a wonderful people that live to 
our south. And I am a Californian. We are very proud of the 
heritage that we share with our brothers and sisters to the 
south. And America could have peoples who are, or other 
neighbors that we didn't like, but I will tell you this much, 
the people of Mexico are wonderful people. I have spent a lot 
of time with them as a young person and as I got older as well. 
Being a surfer, I spent a lot of time with Mexican surfers down 
in Baja.
    So let us just start with that we should be grateful as a 
country for having such wonderful neighbors as we have. Having 
wonderful neighbors and having good friends doesn't mean that 
there aren't problems and you have to work at those problems to 
make sure you maintain a good relationship. I am very happy to 
hear testimony today that indicates that relationship and that 
cooperation is actually on the upswing, and I hope to be as 
supportive as I can of that effort.
    I would like to talk to something that you have touched on 
and ask you what is drug use in Mexico like? Is there a problem 
with internal drug use in Mexico?
    Mr. Brownfield. I don't see anyone else grabbing for the 
microphone, Congressman, so I will take a crack at that. May I 
offer one lesson of history, and that is, there is no such 
thing as a country that serves solely as a transit country in 
the drug trafficking pipeline, and the reason is very, very 
simple. Over the last 30 or 40 years the trafficking 
organizations pay their network in product. They do not pay 
$50,000 to a corrupted customs official. They provide a half 
kilo of cocaine or of heroin and that product then must be 
marketed locally, and in that way a transit nation becomes a 
consumer nation.
    Mexico is, in fact, confronting its own drug problem and 
crisis. It involves methamphetamines, cocaine, and heroin. A 
big part of our program under the Merida Initiative with the 
Government of Mexico is drug demand reduction in terms of 
supporting an education program in schools and among youth, 
treatment and rehabilitation centers, particularly in cities 
that are vulnerable to social unrest and poverty.
    Mr. Rohrabacher. Let me ask you this. Do they imprison drug 
users in Mexico?
    Mr. Brownfield. I will have to double-check in terms of the 
specific state of Federal Mexican law. There are of course 32 
states in Mexico, as in the United States, and each state has 
its own legal code. What I do not know at this point is whether 
mere possession or consumption is a criminal offense.
    Mr. Rohrabacher. Let us note that our drug war has been a 
total failure in the United States. We have massive drug use 
after how many years And that drug use in the United States is 
one of the things that has had a negative impact on our 
neighbor, on our good neighbors who we like. And I think that 
there is a tendency among too many Americans to blame Mexico 
for our problem of consumption when actually it is the other 
way around.
    And I have talked with former President Vicente Fox in 
Mexico, and he is suggesting that perhaps we should try a 
revolutionary approach which is: Bringing down the price of 
drugs by legalizing it and by treating those people who use 
drugs as people who need our help rather than people who need 
to be imprisoned.
    Mr. Brownfield. I agree with you, Congressman, that drugs 
in the United States and everywhere else in the world is a 
public health issue, that it is not just a criminal justice 
issue.
    Mr. Rohrabacher. So let me just say this. The best thing 
that we could do for Mexico would be to lower the price of 
drugs so the cartels then wouldn't have so much income to 
create a power dynamic in Mexico that is negative to that 
country. Isn't that correct?
    Mr. Brownfield. I would want to be very careful not to 
support a policy or a strategy whose effect would be to 
increase the number of users and consumers of dangerous 
products.
    Mr. Rohrabacher. Agreed.
    Mr. Brownfield. I understand what you are saying. My only 
response is the devil is in the details. We have to make sure 
that as we proceed, we are not producing a worse outcome than 
we----
    Mr. Rohrabacher. Right. With a note on that, and I 
understand that argument. But I would just suggest that I 
haven't seen a lot of evidence that indicates that legalization 
of drugs and treating it as a personal problem that some would 
have, rather than a criminal problem, I haven't seen where that 
would increase the use of drugs in our society or in Mexico.
    I have come to the conclusion that people can get a hold of 
drugs in our society no matter what. There is nothing stopping 
them. And that legalizing it wouldn't mean more people would be 
using it. It is just that the drug cartels would be cut totally 
out of the equation and thus helping Mexico. With that thought, 
thank you very much.
    Chairman Royce. We go now to Mr. Gregory Meeks of New York.
    Mr. Meeks. Thank you, Mr. Chairman. And I want to thank all 
three of our diplomats that are sitting at the table. Thank you 
for your great representation of our country and your deep 
concern and commitment to the western hemisphere, you truly are 
examples of fine diplomats that make the United States, and 
serve the United States in a very, very important capacity.
    Let me start with Assistant Secretary Jacobson. And surely 
we have had a long relationship with Mexico, and we have had 
one starting with NAFTA. We moved on and now even individuals 
are talking about how they are tied in with TPP. That is just 
the economics of the relationship between the United States and 
Mexico. I am sure that you have seen this relationship evolve, 
and I was wondering if you would give us some indication of how 
you see it evolving and how you would characterize it now.
    Ms. Jacobson. Thank you, Congressman. I think one of the 
things that is so remarkable is, if you look at the growth in 
the 20 years, the growth in the economic relationship over 20 
years, it is a lot of statistics. And we did hear, I think it 
was in certainly Chairman Royce and Chairman Salmon's remarks, 
the number of jobs that this tripling and quadrupling in trade 
has generated in the United States.
    But the other thing that we have seen in the growth of 
trade since NAFTA and since the growth in our economies' 
connection and connectivity, as we called it in the North 
American Leaders Summit, is the growth in manufacturing 
industries that are now fully integrated. If you look at the 
one that is always used, automobile production, where cars are 
really not American cars, they are North American cars. 
Produced in Canada, in the United States, and in Mexico. But 
that is true in other industries as well. It is true in the 
aircraft industries, and it is increasingly true in many 
manufacturing sectors.
    So I think there is a lot of ways in which we have seen 
that North America, with all of its resources, whether they are 
natural or human, can be a platform for enormous economic 
competitiveness, and that working together is the way that we 
can get there. It is one of the reasons we have spent so much 
of our time in this administration focusing on three areas, I 
think, that are linked to the importance of that economic 
competitiveness, education, especially for the U.S. and Mexico, 
energy, which is crucial to that economic competitiveness, and 
then the Vice President's leadership in the high level economic 
dialogue.
    Mr. Meeks. Speaking of that, I know that upon his 
inauguration President Nieto announced an unprecedented reform 
agenda that he has largely been able to keep intact. And how 
will the recently approved fiscal, labor, education, and energy 
reforms impact the United States-Mexico economic relationship, 
and how do you think that these reforms affect U.S. investments 
in Mexico?
    Ms. Jacobson. Well, one of the things that I think is so 
critical is these are reforms that have been urged by 
economists for 20 years. They are very much the structural 
reforms that many people said were critically necessary for 
Mexico's economy to prosper along with the free trade 
agreement. Economists have always told us that free trade 
agreements alone don't bring about economic prosperity. They 
require structural changes in an economy like Mexico's. And so 
these reforms, in many ways, or some forms of changes were 
needed, I think, to make Mexico more competitive and to improve 
its economy.
    So they really do bode very, very well for the Mexican 
economy, but they also bode well in terms of their openness for 
investment and for greater trade, even greater than we have 
seen in the last 20 years. You also see Mexico as part of TPP 
and as a part of the Pacific Alliance. The nations of Latin 
America, Chile, Peru, Colombia, Mexico, integrating and working 
to promote greater openness in their economies, really trying 
to encourage greater investment from overseas and from all over 
the world, whether it is the United States or elsewhere. So I 
think the opportunities have really expanded even more than 
they have been in the last few years.
    Mr. Meeks. Thank you. Let me go to Ambassador Brownfield 
real quick. I know you have been very involved when you were 
the Ambassador in Colombia. Can you tell us real quickly, what 
has Colombia's role been in providing training for Mexican 
security forces, and what specific areas would it be helpful 
for the Colombian Government to further train or assist Mexican 
security forces?
    Mr. Brownfield. Thanks, Congressman. As you know, because 
among other reasons you and I have actually talked about it, 
the Colombian Government has, in fact, provided support and 
training, exported some of its police and law enforcement 
capability broadly throughout the region, most heavily in 
Central America, and to a lesser extent in the Caribbean.
    In Mexico, there has been a great deal of communication and 
dialogue between them. The Colombian Government has provided a 
great deal of aviation training in terms of helicopter pilot 
training and maintenance and support, mechanics training, if 
you will, for the aviation component of Mexican law 
enforcement. That said, the amount of direct training 
engagement between Mexico and Colombia is less than you will 
find between Colombia and other parts of Central America and 
the Caribbean.
    Chairman Royce. Mike McCaul of Texas.
    Mr. McCaul. Thank you, Mr. Chairman. I want to thank the 
witnesses for being here today, particularly the Ambassador, 
Secretary Jacobson, you are truly fine public servants and I 
appreciate your hard work.
    With respect to Mexico and the Western Hemisphere, as you 
know I chair the U.S.-Mexico IPG, I must say in Mexico City, 
maybe 6 months ago, we had a very productive meeting with the 
Mexican Congress, particularly on PEMEX reform. I have to say, 
I have been very optimistic about this new administration with 
respect to the direction they are taking on energy. And what 
was amazing to me was that all three parties agreed. The PRI, 
the PAN, the PRD, which at this place it is hard to agree on 
anything on either side of the aisle. But, to have all three 
parties come together saying this needs to be done, I think, 
was really remarkable.
    I think Mexico has a unique opportunity to open up its 
energy resources, both offshore and with the Eagle Ford Shale, 
and then working with the United States to have a true alliance 
on energy independence. I just returned from the Middle East, 
from Saudi Arabia, and the U.A.E. We have a great dependence on 
energy with the Middle East. I think this is a great way for 
the United States and Mexico to work together on energy 
independence.
    My question to the secretary would be, and my understanding 
is the constitutional amendment has passed on these reforms, 
but that it is still awaiting, I guess, ratification, for lack 
of a better word, by the Mexican Congress, which would take 
place possibly in the June time frame. Can you give us an 
update on that?
    Ms. Jacobson. As far as I understand, Congressman, 
ratification of the constitutional changes has taken place. But 
now the implementing or secondary legislation has to be passed, 
and it is possible that that will be done in the June time 
frame. Yes.
    Mr. McCaul. Do we feel optimistic that that will get done?
    Ms. Jacobson. I think we are encouraged. Certainly there 
have been lots of discussions and debates and there is likely 
to be some opposition, as is always the case in these things, 
but it seems that there is a great deal of support.
    Mr. McCaul. And I understand also the agreement, when I 
talk to energy companies in the United States, for them it is 
very important to have production sharing as opposed to profit 
sharing, as I understand it. And that would be the key to a 
good marriage here on this issue. Is it your understanding that 
they would lean more toward the production sharing?
    Ms. Jacobson. Congressman, I would have to check and see 
exactly where the legislation stands right now. I think that 
may be the case, but I don't want to misspeak so I will check 
that to be sure.
    Mr. McCaul. We have been very careful not to meddle in 
their affairs. At this point in time, I think it is good for us 
to sit back and watch what happens.
    Ms. Jacobson. Good for Mexicans to make this Mexican 
decision.
    Mr. McCaul. Precisely.
    Ms. Jacobson. Indeed.
    Mr. McCaul. Lastly, I also want to applaud the new 
administration. There was some skepticism on whether they were 
intent on going after drug cartel organizations. And not too 
long into the new administration we had the head of Los Zetas 
taken down and then recently Chapo Guzman, which is a historic 
achievement against the drug cartels.
    I talked to Ambassador Medina-Mora about this capture on 
the issue of extradition. He told me that he was open to the 
idea but that a request had not been made by the 
administration. Can you give me the, and I know DOJ is involved 
with this as well, but can you give me an update on the status 
of any extradition request?
    Mr. Brownfield. Oh, she turned that one over to me, 
Congressman.
    Mr. McCaul. And lucky you.
    Mr. Brownfield. For which I am of course eternally 
grateful. Members of the committee, I believe this is known to 
everyone on this committee and I presume to every citizen of 
the United States and Mexico, there are, in fact, indictments 
against Mr. Joaquin Guzman in the United States of America for 
Federal charges related to drug trafficking offenses. There are 
also obviously charges and indictments pending against him in 
the Mexican legal system.
    I believe what Ambassador Medina-Mora has said to you is 
quite consistent with what he has said to us. We have two legal 
systems which have expressed interest in taking jurisdiction 
over this particular matter. It will eventually be determined 
by the Mexican judicial system in terms of whether they will 
try him there or they will support an eventual extradition of 
him to the United States, and at the end of the day that 
decision will play out in its own time.
    Mr. McCaul. Okay. I thank you for that answer. I see my 
time has expired.
    Chairman Royce. Mr. Sires?
    Mr. Sires. Thank you, Mr. Chairman. Tomorrow Secretary 
Kerry is going to Mexico. I am happy to see that there is not 
just the Middle East, that we have a whole other part of the 
world that we need to focus on. What can we expect from this 
trip? Is there going to be any announcements? Anything you can 
give us a heads-up on before the trip?
    Ms. Jacobson. Sure. I don't want to break too much news 
ahead of his trip, but I think it is not a secret that he is 
going to focus, that the trip is relatively brief but it will 
focus on three areas that I think are among those that I have 
talked about today. He will meet with his counterpart, the 
foreign secretary, as well as the education secretary, and he 
will have Frances Cordova from the National Science Foundation 
with him to talk about our Bilateral Forum on Education, 
Innovation, and Research.
    So this will be kind of a continuation and a launching of 
our action plan on bilateral education. This has been a real 
key part of our relationship, a desire to do more in higher 
education, to do more in research efforts together. That is why 
the National Science Foundation is involved. He is also going 
to attend an event in which they are going to talk about clean 
energy and clean technologies. So a lot of this will focus on 
the economic and education agenda. But obviously, he is also 
going to be talking with his counterpart and with President 
Pena Nieto about problems in the world that we can work on 
together, and in the region.
    Mr. Sires. Do you anticipate discussion on the security of 
the southern border? The border with Guatemala and Belize? I 
mean that is becoming a real dangerous point. And what else can 
we do to assist Mexico at this part of the Mexican border?
    Ms. Jacobson. I am actually going to turn it over to 
Ambassador Brownfield in a moment, but I certainly expect that 
will be part of the conversations. But one of the things that 
we have decided as an interagency group is also that the White 
House and the deputy Homeland Security advisor, Rand Beers, 
will be talking are continuing his conversations with the 
Mexicans on the citizen security issue. Ambassador Brownfield 
has supported those efforts, including discussions on the 
southern border of Mexico.
    Mr. Brownfield. Very briefly, Congressman. There is already 
a bilateral agreement. This is an important project for both 
governments, the United States and the Mexican Governments. It 
is already an area where we have agreed on several specific 
projects that total nearly $11 million in terms of assistance 
and equipment that would support the ability of the Mexican 
Government to link together their drugs, customs, border, and 
police personnel on their border with Guatemala and Belize.
    We want to do it carefully because unlike the U.S.-Mexico 
border, where we obviously have a right to speak and to speak 
publicly about our interests, the border between Mexico and 
Guatemala obviously is not something on which we have an 
automatic right to an opinion.
    We realize however, first, that the southern border of 
Mexico is about one-tenth the length of their northern border 
and therefore it is a much easier challenge to manage. And 
second, the overwhelming majority of the bad stuff that starts 
in South America and eventually enters the United States 
crosses that southern border before it crosses the border with 
the United States. High priority, we are in agreement, and we 
are committed to work with them on it.
    Mr. Sires. It is not just Guatemala. Belize is also a 
transit point for drugs coming into this country.
    Mr. Brownfield. You are exactly right, and I was speaking 
in shorthand for which I should apologize. But you are 
absolutely correct. And in some ways it is even more dangerous, 
because Belize, being a far less populous country, does not 
necessarily have the resources to throw at the border issues as 
does Guatemala.
    Mr. Sires. Thank you very much, Chairman.
    Chairman Royce. Thank you, Mr. Sires. We now go to Matt 
Salmon of Arizona.
    Mr. Salmon. Thank you, Mr. Chairman. I am going to direct 
my first question toward Secretary Jacobson. As we look for 
ways to improve management of our shared border in an effort to 
shorten those wait times at our ports of entry, I am pleased 
with some of the agreements we have reached with the Government 
of Mexico to achieve border efficiency; particularly given the 
loss of billions of dollars in economic opportunity that occurs 
each year due to wait times on the border.
    One ongoing discussion has been the expansion of pre-
clearance zones on either side of our borders, starting with a 
few pilot programs. Assistant Secretary Jacobson, can you give 
us a sense of how these discussions and the pilots are 
progressing, particularly given the sensitivity on the Mexican 
side on the topic of our CBP agents carrying their weapons 
within the pre-clearance zones?
    Also, hand-in-hand with the commercial side of the border 
management is border security. Again, our diplomats in Mexico 
City have made tremendous progress in reaching agreements to 
improve our partnership in these efforts, in particular the 
mirrored patrols between U.S. Border Patrol and Mexican Federal 
police along the busiest smuggling corridors. However, it is my 
understanding that there have been only around 150 Mexican 
officers deployed, not nearly enough. Has there been any 
progress in getting the Mexican Government to commit more 
resources to this effort?
    Ms. Jacobson. Thank you very much, Mr. Chairman. And on the 
pre-clearance issue, I know that we have really been in pretty 
intense conversations with our Mexican counterparts, both sides 
really wanting to try and reach toward an agreement on that and 
I believe that some progress is being made there. Let me get 
the specifics of where we are on that and try and get back to 
you.
    I know how important this is, not only to you and your 
state because that is where we would try and do our pilot, but 
really to the border as a whole and to the country. We want to 
try and figure out whether this model can work. It would be so 
productive, make things so much easier, and then hopefully be 
able to be expanded. This is something that we have been 
working on for awhile and we would really like to try and break 
the log jam. So let me get you more detail on where we are. It 
is something we really will continue to try and work towards.
    On the issue of the border violence and the efforts to 
reduce border violence and to work on both sides of the border, 
clearly we work best at that issue when we are working on both 
sides, when we are communicating across the border. And the 
conversations that we have had with our Mexican counterparts 
since we restarted our dialogue with the new government, if you 
will, with the Pena Nieto government last fall, I think, have 
really improved our communications and have made it easier to 
cooperate across the border.
    We continue to work with them to try and get more Mexican 
officials on the other side, especially to move to hot spots as 
we get information intelligence on where danger may be, and we 
will continue to have those conversations.
    Mr. Salmon. Thank you. Ambassador Brownfield, I want to 
congratulate you and your colleagues at our Embassy and 
consulates in Mexico for what you have achieved in 
strengthening the security partnership with Mexico through the 
Merida Initiative. Despite some setbacks and reorganization 
following the election of President Pena Nieto, progress is 
being made. However, there remains a substantial pipeline, as 
you know, so I would like to know from you where the sticking 
points are and if we can expect to see more steady progress.
    And then, I would like to get a sense from you about 
whether the Government of Mexico has prioritized or will 
prioritize its security efforts in the state of Tamaulipas. The 
violence there, as you know, is happening right along the U.S. 
border near Brownsville and McAllen, Texas, and I know there 
have been several opportunities for us to ask questions of our 
counterparts in Mexico. And I think that while they want to 
improve the security, they kind of throw up their hands in some 
of these areas like this, and I just don't think we can do 
that.
    Mr. Brownfield. Thanks, Congressman. First, on the pipeline 
issue. And the pipeline, ladies and gentlemen, is what we in 
the program management business call those funds which have not 
been either obligated or subobligated and expended, spent down.
    And you are correct, Congressman, as always. The pipeline 
for Mexico, at least in terms of those funds for which I am 
responsible, the INCLE funds, had reached nearly $900 million. 
The reason for it is simply stated. One, the 2013 money and the 
2014 money has not yet been obligated due to the speed with 
which things move through. When that is completed, about $350 
million will then be obligated.
    Second, as I mentioned in my presentation, there was a 
period when new programs were not being launched. We have moved 
beyond that period. I repeat. We have reached an agreement on 
$438 million worth of 78 new programs. I would expect that to 
bring this pipeline down by more than 50 percent in and of 
itself.
    Finally, we do have a few holds. They constitute about $100 
million. No one on this side of the Capitol is responsible for 
them, but that is money that cannot be spent until the reasons 
for the hold have been lifted. I am optimistic. The signal that 
I want to send to you, Congressman, is I am optimistic that 
pipeline delays are not going to be a longstanding issue that 
you will have to raise with me.
    Chairman Royce. Thank you, Chairman Salmon. Thank you, 
Ambassador. We go now to Mr. Juan Vargas of California.
    Mr. Vargas. Thank you very much, Mr. Chairman, for the 
meeting, and thank you to the witnesses. There are three issues 
that I would like to talk about. The first one is an active 
U.S. Marine reservist. His name is Andrew Tahmooressi. Also, 
the border efficiencies that we just spoke of, and lastly, the 
North American Development Bank.
    I live in San Diego, about 14\1/2\ miles from the border, 
and love living there, and love living next to Mexico. It has 
been a great place to live. However, inadvertently every so 
often, a Marine or another person will go across the border and 
have weapons on him. And as we have been hearing today, they 
are quite illegal in Mexico.
    This poor gentleman, Andrew Tahmooressi, did that. He 
crossed the border. He had three weapons on him. He is a 
reservist. He served two tours of duty in Afghanistan. He 
served our country very honorably, and unfortunately he is now 
in prison in Mexico for about a month. Everyone understands 
that he is not a drug trafficker. He is not in any way a 
criminal, in fact, just the opposite. He seems like a very good 
person that has been diagnosed with post traumatic stress 
disorder and he certainly needs to come back to the United 
States and get treatment. And I was hoping that you could 
comment on that. I wanted to bring it up.
    The other members of the delegation in San Diego are 
working on this case, and Bill Whitaker, at the U.S. Consulate 
General in Tijuana has been fabulous, visiting him and doing 
everything he could and can. But anyway I would like you to 
comment on that if you could.
    Ms. Jacobson. Yes, just briefly. Thank you, Mr. Vargas. As 
you know, and obviously you are aware, and I am grateful for 
your recognition of that, we have visited Mr. Tahmooressi. We 
will continue to do so. I think we have been about 10 times so 
far. We have been able to facilitate the visit by his wife. We 
will continue to do all that we can to----
    Mr. Vargas. I believe it is his mother.
    Ms. Jacobson. His mother. I am sorry, you are right.
    Exactly right. Sorry. I have made him older than he is. I 
apologize. But in any case, we will continue to make sure that 
we have family members, facilitate their visit, anything that 
we can do to help him. We have also made representations, 
obviously to the Mexican Government, to make sure that his 
treatment is adequate and appropriate, to make sure that he 
gets his hearing as quickly as possible. I believe it is 
scheduled for May 28th.
    Mr. Vargas. That is right.
    Ms. Jacobson. Obviously we want to try and get this 
resolved as quickly as possible.
    Mr. Vargas. Thank you. And I hope you can. Again, it seems 
like a very unfortunate situation that happens quite often. The 
other issue we talked about a little bit is border 
efficiencies. I would bring up the issue of infrastructure. 
Obviously you need more infrastructure in San Ysidro. We are 
moving forward. I thank you very, very much. And I just remind 
you of Calexico. It takes me less than 20 minutes to drive to 
the border and oftentimes it takes me 3\1/2\ to 4 hours to 
cross back.
    Ms. Jacobson. Yes, San Ysidro and Otay Mesa get all the 
attention. But you are right, there are a lot of things going 
on all along the California-Mexico border. In the Calexico-
Mexicali port of entry, a design has been completed for a two-
phase renovation and I think that will hopefully be able to get 
underway pretty quickly. I do think that obviously the much 
bigger effort has been the three-phase renovation at San Ysidro 
which has expanded booths, inspection booths.
    Mr. Vargas. Thank you very much for that.
    Ms. Jacobson. Twenty four to 46. It is pretty amazing isn't 
it?
    Mr. Vargas. That is right.
    Ms. Jacobson. And obviously work on Otay Mesa East, but we 
are not forgetting Calexico at all.
    Mr. Vargas. Thank you very much. And lastly, the North 
American Development Bank. The NAD Bank has done quite a lot of 
good in San Diego and especially in Imperial County. And I just 
would hope that you would take a look at that again and hope 
that there is still a strong commitment by our Government to 
the NAD Bank. And again I just want to bring that up because it 
has been a very important bank for a lot of the issues that 
confront poor neighborhoods and poor areas along the border.
    Ms. Jacobson. Thank you so much, Mr. Vargas. I was actually 
a NAD Bank board member earlier in my career. I think it has 
gone from being called the Nada Bank to being a real 
powerhouse, and one of its most important original missions was 
to make sure that it served some of the poorest communities. 
And I think it is incredibly important that it continues to do 
so.
    Mr. Vargas. Okay. And just again, just to emphasize that we 
have had a great relationship with Mexico along the border. Our 
U.S. Consulate in Tijuana has been fabulous. But there are 
little things that happen along the border and it is 
understandable Mexico wants tough laws to make sure that you 
don't import guns and we want that too. I mean, we have talked 
about that here.
    But this poor Marine, he inadvertently crossed, I mean, in 
no way, shape, or form is he a drug trafficker, a gun 
trafficker. He is a gentleman who served honorably. And he 
unfortunately didn't see the last turn. You turn here, and he 
crossed into Mexico, told the truth, and now we have him there. 
Anyway I yield back now.
    Chairman Royce. Thank you, Mr. Vargas. We are going to go 
now to Mr. Randy Weber of Texas.
    Mr. Weber. Thank you.
    Ambassador, you said in your questioning from Chairman 
Royce, you gave a whole list of different law enforcement 
agencies, and I must have stepped out right before that 
happened. What was that list in response to?
    Mr. Brownfield. The chairman had noted that the Attorney 
General of California was providing some support for 
prosecutorial training in California. And Mr. Weber, what I 
did, I took advantage of the opportunity to note that there was 
a large list of state and local law enforcement and judicial 
that had done this.
    Mr. Weber. Thank you. I appreciate that.
    Ms. Jacobson, you said in your comments that our border 
with Mexico was more secure than ever. What matrix, what data 
are you using to come to that conclusion?
    Ms. Jacobson. Congressman, I think that basically the data 
I would use to point to that is that there are fewer people 
coming in through the, we had net migration from Mexico of 
zero. We have a period, we have more resources, more people, 
more high tech equipment that is being used; obviously 
resources provided by Congress to keep that border secure.
    Mr. Weber. Do you have a breakdown by state what those 
resources are?
    Ms. Jacobson. I could certainly get additional information 
from our colleagues at the Department of Homeland Security.
    Mr. Weber. Let us do that. Did you have input from the 
various state agencies responsible along those four states' 
borders?
    Ms. Jacobson. We certainly work with many of the agencies 
in the states as does DHS.
    Mr. Weber. Okay. Because I was vice chairman of the Borders 
Committee in Texas, and I would tell you that when I was there, 
and I was there before I came to Congress this term, that 
wasn't their assessment, that the border was safer. I can tell 
you that from speaking to Steve McCraw, the Director of the 
DPS, former FBI, he is a retired FBI official, and that was not 
their assessment. You are aware of the recent reports that the 
current administration had released some 36,000 convicted 
illegals?
    Ms. Jacobson. Yes, sir.
    Mr. Weber. Okay. And you still think that we have a safe 
border?
    Ms. Jacobson. I think that we have made huge strides in 
security along the border. Yes, sir.
    Mr. Weber. Okay. I would like to get the data that you used 
to come to that conclusion. So you have not--and that was 
really going to be my question, Ambassador Brownfield. The 
Texas DPS or the Texas agencies, they were not on that list. I 
did not hear you read the Texas Attorney General. Did I miss 
that?
    Mr. Brownfield. I am going to jump ahead of you here, Mr. 
Weber. I am pleased to report that about 2 months ago I had the 
pleasure and the honor to be in Austin. I did spend about 4 
hours in the company of the Director of the Department of 
Public Safety, Mr. McCraw. We did sign an MOU as of about 2\1/
2\ months ago, whereby Texas DPS will, in fact, be a partner. 
They will be on this list as we work our way into programs and 
projects that are specifically related to their areas of 
expertise.
    Mr. Weber. Okay. Let me break in there. Because when I was 
Border Committee vice chair, my only two terms in the Texas 
legislature, if I remember the numbers right, we put, and 
Joaquin was there in the legislature with us, I think we put 
$200 million in equipment and boots on the ground. We have got 
five helicopters. We have got surveillance airplanes. We have 
got a high speed boat. We have got a lot of high-tech stuff 
along the border of Texas and obviously the Mexican border.
    And my question was going to be, we have spent a lot of 
money to help secure the border down south with Guatemala, for 
example, but are we spending a commensurate amount on the 
northern border? Because I will tell you, that arguably the 
Texas legislature will tell you, that the Federal Government 
has not been kicking in a commensurate amount on the Texas-
Mexican border. Ambassador, what say you?
    Mr. Brownfield. First, I get to hide, Congressman, and say 
that we of course are the international side, so by definition 
we are working south of the border. Second, I will say that I 
had the same conversation with Mr. McCraw that you have had and 
I agree that is his view. When I said to him my perspective is 
that the situation on the border is, in fact, getting better, 
he said that is not the reality we are dealing with, and he----
    Mr. Weber. Let me break in for the record, because I want 
this on the record. He told me that 76 sects, S-E-C-T-S, 
Eastern religion sects, are coming across our southern border. 
Now that ought to scare, what we call in southeast Texas, the 
bejabbers out of people. Seventy religious sects, Eastern sects 
from the Middle East. So I would simply say for the record, Mr. 
Chairman, that we need to be sure that we focus on securing our 
border, and I yield back. Thank you.
    Chairman Royce. Mr. Joseph Kennedy of Massachusetts.
    Mr. Kennedy. Thank you, Mr. Chairman. Thank you for calling 
such an important hearing. To the witnesses, thank you for your 
testimony today. Thank you for your patience. And most 
importantly, thank you for your service. Extraordinarily 
important, and you have all distinguished yourselves over many 
years of service, so thank you very, very much for that.
    I am going to, I think, strike a theme that many of my 
colleagues have also already talked about a bit with you, Mr. 
Ambassador. You talked a bit in your testimony already and in 
many of the questions that have been asked about the recent 
positive developments regarding economic and energy reforms 
taking place in Mexico and the recent capture of ``El Chapo'' 
as an example of how the United States and Mexico can cooperate 
and make both countries safer in targeting drug traffickers.
    Drug trafficking is of pretty good interest to me as a 
former prosecutor, and I think most importantly, across 
Massachusetts heroin overdoses are on the rise. In my district, 
specifically, Bristol County has been on the front line of this 
painful epidemic, and by the end of last month the Taunton 
Police Department confirmed that there have been over 140 
heroin overdoses in the city in 2014 alone.
    Equally concerning is SAMHSA's, the Substance Abuse and 
Mental Health Services Administration, recent report that shows 
12.3 percent of Massachusetts youth between the ages of 12 and 
17 reported using illicit drugs within a month before the 
survey was conducted. Compare that to the national average of 
9.8 percent.
    I spoke with local leaders, health care providers, law 
enforcement officials from Taunton, Fall River, across Bristol 
County, who stressed two things driving the surge in overdoses 
and addiction. First, the prevalence of prescription drug abuse 
that is often the root cause of opiate addiction. Four out of 
five heroin users started with prescription opioids before 
moving on to harder drugs.
    And number two, the rash of, and I know you talked about 
this a moment ago, incredibly cheap heroin that is flooding our 
streets, making it more tempting for a kid addicted to 
oxycontin that can go for up to $80 a pill to $3 a bag for a 
bag of heroin in parts of Massachusetts.
    In its March 2013 report, the INL, the Bureau of 
International Narcotics and Law Enforcement in the Department 
of State, states that ``Mexico accounts for about 7 percent of 
the world's leading heroin supply and most of it is smuggled 
into the U.S.'' DEA officials I met with confirmed that large 
amounts of the drugs you find on the streets in cities like 
Taunton have Mexican origins, and a large, I believe it is a 
front page story in the New York Times today talks about New 
York City as being a hub of heroin for distribution across the 
northeast, much of that coming from Mexico.
    Mr. Brownfield, you have talked a bit about this already, 
but if you can give us some detail as to what advice you would 
give me, what advice you would give this committee as to what 
we can do about this on top of your efforts that you are 
already undertaking, I would be grateful.
    Mr. Brownfield. Congressman, I am going to start with 
something that, I don't know how often you hear it but I will 
say it, I agree with absolutely everything you have just said. 
There is not one point of disagreement in what you have just 
described that I would point to.
    Mr. Kennedy. I don't get that often enough, but thank you.
    Mr. Brownfield. I would say the following, and I know we 
are not supposed to create headlines here, Roberta, Beth, but 
I, in fact, do believe the United States of America is 
confronting a nationwide heroin crisis. I have seen the same 
statistics you have. Over the last 4 years, the number of 
addicts and abusers of heroin in the United States of America 
has jumped between 75 and 80 percent. The amount of estimated 
pure heroin that is entering the United States has increased by 
nearly 100 percent. Heroin is now found in neighborhoods, 
cities, regions of the country where it never was seen before.
    And we are, I would also suggest, set up to address a 
different sort of drug problem. We have gotten pretty good at 
it over the last 40 years, and that is interrupting the flow of 
cocaine and methamphetamines that start in South America, 
process in transit through Central America and Mexico or the 
Caribbean, and enter the United States of America.
    Heroin is a different problem set. We have got to get our 
head around that problem set, and we will have to address it or 
we will pay very long term consequences. Mexico is very much a 
part of this issue. You have cited the statistic. The statistic 
I have read is roughly 26 metric tons of pure heroin produced 
in Mexico any given year.
    That may sound like a lot, although may I remind the 
members of this committee we estimate 600 to 650 is produced in 
Afghanistan. But nevertheless, if the U.S. market is between 15 
and 40 tons per year, 26 tons actually goes pretty far toward 
satisfying the entire market. And we are going to have to 
adjust our tactics, our policy, our dialogue, and our diplomacy 
in order to address heroin as well as cocaine and 
methamphetamines. That is the answer I give you today.
    Mr. Kennedy. Mr. Ambassador, I know I am over time, but if 
you might be able to respond in writing with some suggestions 
on how we should do that I would be grateful. Thank you. Thank 
you, Mr. Chairman.
    Chairman Royce. Thank you, Mr. Kennedy. We now go to Adam 
Kinzinger of Illinois.
    Mr. Kinzinger. Thank you, Mr. Chairman, and thank you all 
for being here. Appreciate it. A very important hearing to 
have, and a relationship that I think sometimes both countries 
take for granted. So I appreciate the attention being brought 
to this today.
    I just want to add to the heroin issue, the talk on that. 
There is a youth recovery center in my district and I went to 
that recently. And the person who was taking me around and 
introducing me to these teenagers, 14-15 years old, said, 
``Hey, ask these kids what they are addicted to, what their 
addiction is.'' And I mean, when I was in high school the drug 
issue was marijuana, right. That was the extent of it.
    So I asked the kids, ``What are you guys addicted to? What 
is your issue?'' And half of the kids in that room were heroin. 
I mean it shocked me. It actually caught me way off guard. I 
knew it was a rising epidemic. I didn't realize 14- and 15-
year-olds were getting into heroin as intensely as they are. 
And in areas of my district you can buy it cheaper than 
marijuana now. So it is a real, real issue.
    I guess, let me ask Ms. Jacobson, I am going to switch 
subjects now off of that. Mexico was projected to grow last 
year at 3 percent. It actually had a 1.1 percent growth. 
Economists are predicting that there is going to be much better 
growth this year. Given the fact that our economies are so 
interconnected and given some of the reforms going on in 
Mexico, how do you think those reforms are going to impact 
economic growth in Mexico and therefore our growth? And if you 
could keep it fairly short, because I have a couple other 
issues I want to hit too.
    Ms. Jacobson. I will try and be really quick because I 
don't have the crystal ball. I wish I did.
    Mr. Kinzinger. You don't? Oh, too bad.
    Ms. Jacobson. I wish I did have the answer to that 
question. But I do think that the reforms open up possibilities 
for greater economic growth. I think the real question to some 
extent is how quickly, right? The implementing legislation gets 
put into place, now the expectations are very high.
    But it is not clear to me that the results of that, in 
terms of improved economic performance and growth, are going to 
be immediate. So I don't know how quickly----
    Mr. Kinzinger. So maybe the hope is today we get kind of a 
boost from just people feeling better about it.
    Ms. Jacobson. Certainly you get some increased expectations 
and positive feelings. I think you probably get some increased 
investment, and I think then you begin to get real changes.
    Mr. Kinzinger. Thank you.
    Ambassador Brownfield, I am an international guard pilot. 
One of the missions I actually have flown is on the border of 
Mexico as part of border operations, I guess we will call it. I 
worked with Customs and Border Patrol. I have seen firsthand 
the threat that a porous border creates. And I am not talking 
about people coming over. I am talking about illicit drug trade 
and everything along that level.
    And I think, frankly, that issue creates damage and 
mistrust between the two countries to an extent, and I think a 
secure border could mean different things to different people, 
as we talk about everybody says they want a secure border.
    So I want to ask you a question specifically. Talk about, 
yes, do you have the 21st century border and the four pillars I 
know that you have talked about in this initiative? Could you 
describe what you envision? What does a secure border under 
this look like and especially when it comes to illicit drug 
trade?
    Mr. Brownfield. Sure. And I would remind you as I start, 
Congressman, that of course what we are doing for the Merida 
Initiative is on the southern side of the border. That is our 
focus. State, local, and Federal law enforcement obviously 
manages the northern side, the U.S. side of the border.
    First and foremost, our focus is on equipment. A modern 
21st century border is a border that, in fact, has the sort of 
inspection equipment that allows your authorities to verify 
what is coming through or to the border in a way that does not 
create 50-mile backlogs and 2-week delays in order to cross the 
border.
    And I mentioned over the last 4 years we have provided $112 
million worth of nonintrusive inspection equipment, and we 
believe that has been responsible for $3.8 billion worth of 
seizures. A pretty good----
    Mr. Kinzinger. Just real quickly. Some of that stuff that 
is being repatriated from Iraq and Afghanistan, for instance, 
that we are bringing back, I mean ISR type platforms, stuff 
like that?
    Mr. Brownfield. Not yet. However, you have put your finger, 
Congressman, on an issue that has increasingly become a matter 
of internal discussion within the executive branch. And that is 
simply put, resources or assets that are, in fact, going to be 
drawn down and removed from one region that could be put to 
this mission, not just incidentally along the U.S.-Mexico 
border but in other parts of this hemisphere as well? And we 
are actively assessing it as you can imagine. My coming-in 
position is, I would like to apply as much of that as possible 
to this mission.
    Mr. Kinzinger. Yes, and as an ISR pilot, like I said, and 
operating overseas in the war but also operating domestically 
in those kinds of areas, I think it is very important and it 
helps our situational awareness.
    My time is out. I just want to make a quick statement too 
in terms of the importance of our natural gas resources here. I 
know Mexico really needs the natural gas that we have, and so I 
would like to put a plug in to say that we are in a good 
position to really help our neighbors in terms of that. So with 
that, thank you all for your generous time in being here. Mr. 
Chairman, I will yield back.
    Chairman Royce. Thank you, Mr. Kinzinger. We now go to 
Joaquin Castro from Texas.
    Mr. Castro. Thank you, Chairman, and thank each of you for 
your testimony. My grandmother is from Coahuila, Mexico, from a 
small town, San Pedro. My wife's family is from Reynosa in 
Tamaulipas. And San Antonio, as you know, over the years has 
been very instrumental in the U.S.-Mexico relationship. It is a 
place where NAFTA was signed. It is home to the NAD Bank. And 
so there is a lot of trade that goes on between the state of 
Texas and Mexico. Texas has the longest border with Mexico at 
1,200 miles.
    And so in reviewing some of these documents that you guys 
provided, I was struck by the incredible drop in aid from $265 
million to $140 million from year to year. And I know that you 
provided some explanation for that, but how would you answer 
the charge that the U.S. is backing away on its commitment to 
Mexico, and also how does that number compare with any aid of 
other countries in Latin America? Has there been a drop in aid 
to Latin America?
    Ms. Jacobson. Congressman, a couple of things on that. 
First of all, on the Mexican relationship, having been present 
at the birth, if you will, of the Merida Initiative when I was 
first the Director of Mexican Affairs and then the Deputy 
Assistant Secretary, it did start very large. And we did know 
that it was going to ease off because of the equipment that 
was, as we said, very explicitly front loaded, because 
equipment takes a long time, helicopters in particular. You 
have to order it and decide which kind.
    But we also were in conversations with the Mexican 
Government--at the time their feeling was very clear--they did 
not believe they were going to need assistance from the U.S. 
Government for a very long time. That they were an OECD 
country, that they had very good resources, and that they 
needed our expertise more than they needed huge amounts of 
resources for equipment.
    The government of President Pena Nieto believes they still 
need our expertise and our training, but that the reduced 
amounts will be sufficient for what they require of us. So we 
do believe that these reduced amounts, we hope they will not 
trail off precipitously from here but that they will----
    Mr. Castro. Oh, that is a huge drop----
    Ms. Jacobson. It is a very large drop. But we have also 
gotten past the biggest equipment purchases, as Ambassador 
Brownfield mentioned.
    Mr. Castro. Sure. And in Latin America generally.
    Ms. Jacobson. But in Latin America, let me say honestly I 
certainly would not deny that there has been a very large drop.
    Mr. Castro. Well, and the reason I asked that is because I 
know there is a competition for dollars around here. And there 
has been over the years a dropping commitment, I believe, to 
foreign aid and to the United States' involvement and 
engagement of the world, which I don't think is good for our 
country. And so I guess what I am trying to get at is are we 
robbing Peter to pay Paul?
    Ms. Jacobson. There is a huge amount of pressure on the 
budget. That certainly can't be denied. There is a lot of----
    Mr. Castro. And I wouldn't necessarily blame the 
administration for having to do that. I just want us to be 
clear about what is going on.
    Ms. Jacobson. During this period, when there has been so 
much pressure on the budget, we have also seen the period in 
time where growth rates in Latin America, especially in some 
countries in the region, have been very, very strong. In some 
of those places we have felt it was perfectly appropriate to 
reduce aid because it just wasn't as necessary as in the past, 
or because we didn't feel that we needed the same amounts in 
the same areas as before.
    It is not to say that there are not still needs, but is it 
an area in which the U.S. can do something that the NGO 
community or international organizations cannot fill? We feel 
that we are doing what we should be doing in the region, but it 
has been a large reduction.
    Mr. Castro. But I think, unfortunately, that has been the 
relationship with Latin America over the years, where Latin 
America is put on the back burner and is one of the first 
regions to get cut. And I don't think that is in the best 
interest of the United States.
    But I have a second question. The Congress right now is 
debating the Trans-Pacific Partnership, and in debating the TPA 
and the Trans-Pacific Partnership we are looking back to NAFTA. 
And for many Democrats in particular, they wonder what the 
environmental and labor standards, what has happened to those 
in Mexico, the United States also, but in the countries at 
stake. So what has NAFTA done in terms of labor and the 
environment in Mexico since its passage 20 years ago?
    Ms. Jacobson. Well, I think one of the important things 
about TPP, Congressman, is that it brings some of the countries 
that were involved in our early free trade agreements, where 
things like labor and environment were, as you will recall, 
side letters, not integral parts of the free trade agreements. 
More recent free trade agreements have had labor and 
environment as part of the free trade agreements. And what TPP 
would do is look at the higher standard for labor and 
environment, which I think is critically important.
    Mr. Castro. True. And I know I am out of time. I will 
follow up with you all.
    Ms. Ros-Lehtinen [presiding]. Thank you so much, Mr. 
Castro. Thank you to our witnesses for being here. The chair 
recognizes herself.
    While I recognize the importance of the improvements that 
we have made jointly in the judicial sector, I believe it is 
only prudent for the U.S. to continue to seek and push 
extradition of high value criminals who could provide us 
insight into the drug trade in our region.
    Three months ago, with our assistance the Mexican 
Government apprehended, as we all know, Chapo Guzman, one of 
the world's most notorious drug traffickers. Many of our 
members including Mr. McCaul have brought up the issue of 
extraditing him. We have got to continue to put pressure on 
Mexico so we don't have more of these cases. And thank you to 
everyone who has brought it up. Please keep that as one of our 
priorities.
    And I am also concerned about the human rights situation in 
Cuba, not just in Mexico, not just for Mexican nationals, but 
for U.S. citizens. In 2012, I led the effort for another Marine 
veteran, Jon Hammar, who also, like this sad case, ended up in 
a Mexican jail for far too long. The family was at first quiet, 
but then became vocal because they were not getting much 
success.
    And today, as Congressman Vargas had pointed out, there is 
a new case in Mexico of Andrew Tahmooressi, a Marine veteran 
from south Florida. I was pleased to join Mr. Vargas and Mr. 
Duncan Hunter in a letter to the Embassy in Mexico, asking that 
this hero be helped out in his sad situation. I would like to 
put that in for the record.
    And also I joined a letter with Debbie Wasserman Schultz 
and the mom of Andrew, who lives in her district. So Mario 
Diaz-Balart and Ted Deutch, our congressional colleagues, and I 
joined Debbie on this letter, regarding the 25-year-old Marine 
Corps veteran from Weston, Florida. And we are very worried 
about this case, and it takes a lot of pressure and a lot of 
U.S. help to get these cases resolved. And I hope that in the 
same way you helped with Jon Hammar that you help out with 
Andrew's case, and I will put those in the record. And so I 
would like for you to comment on that. And secondly, Secretary 
Jacobson thank you for rectifying for the record a statement 
that had been made in the Senate committee about a different 
case, this one on the Venezuela sanctions bill. I did not want 
to let the opportunity that you are before me, always to speak 
about other areas of interest of mine including my native 
homeland of Cuba and in this case Venezuela that you had 
inartfully said that the Venezuelan opposition was against the 
sanctions bill.
    Thank you for clarifying that that is not the case. Whether 
they are or aren't, I think it is the right thing for the 
United States to sanction human rights violators that have 
killed so many in Venezuela. Leopoldo Lopez's third month in 
jail, opposition leader Maria Corina Machado stripped of her 
legislative seat. We hope that we can move that bill quickly in 
the House. I know Senator Menendez and Senator Rubio are 
working on that as well. So I did not want to take too much 
time on that because I know it is about Mexico.
    But today is Cuban Independence Day. We wish that Cuba were 
truly independent. I would like for that to be truly the case. 
And so if you could comment, Secretary Jacobson, on Andrew's 
case, on Venezuela, and Cuban Independence Day.
    Ms. Jacobson. Thank you, Madam Chair. And on Andrew 
Tahmooressi's case, as I mentioned earlier we will continue to 
do everything that we can for him. Certainly everything that we 
can do to get him home to his family, to get him out of 
detention.
    I guess all I can say in this case is I hope that we will 
continue to work together on this one as actively, each of us 
in our own way, because when these things happen all we want is 
to get these folks home as quickly as we can. So thank you for 
your efforts on it and we will continue to do what we can along 
with our consulate in Tijuana and our Embassy in Mexico City. 
These are important cases. I appreciate Congressman Vargas 
bringing it up and we will continue to do everything we can on 
that.
    And just to say thank you for mentioning the clarification 
on Venezuela. I too was noticing this week the comments that 
dialogue cannot be--what was the comment? Dialogue should not 
just be a tertulia. It is not just dialogue for dialogue's 
sake. It has to be dialogue with an endpoint of action, and 
those are the actions that we both want to see. So I certainly 
agree with you on that. Not just dialogue for dialogues sake 
otherwise----
    Ms. Ros-Lehtinen. Because it is just running out the clock 
and not----
    Ms. Jacobson. Exactly.
    Ms. Ros-Lehtinen [continuing]. Really wanting any 
resolution.
    Ms. Jacobson. Otherwise other means have to be taken----
    Ms. Ros-Lehtinen. We have got to hold them accountable.
    Ms. Jacobson [continuing]. To demonstrate our disapproval. 
And on Cuban Independence Day, let me say we also agree that we 
look forward to a day when the Cuban people can make their own 
decisions about their own future.
    Ms. Ros-Lehtinen. Amen. Thank you so much. Thank you to all 
of you. Mr. Connolly is recognized.
    Mr. Connolly. Thank you, Madam Chairman.
    Let me ask Assistant Secretary Jacobson, and I understand 
in advance, diplomatically, what your answer is likely to be, 
but there have been people who have looked at northern Mexico 
and have felt, frankly, it falls within the rubric of a failed 
state. How would you react to that?
    Ms. Jacobson. Congressman, that question came up fairly 
often early in the discussion of the situation in Mexico 5, 6 
years ago and it was a serious question, but I think there 
really is a serious negative answer to that question. That is 
to say, I do not think we have a failed state in any part of 
Mexico.
    There are government structures still in place everywhere 
in Mexico which I believe are exercising their functions. They 
may be stronger or weaker depending on where the drug trade is 
being plied, they may be under siege in some places and need 
the support of the Federal Government, as has been the case 
once again now in Tamaulipas which is where the Federal 
Government is sending in both security forces and prosecutors, 
as was the case obviously in Michoacan, as has been the case in 
many places where these transnational criminal organizations 
come in. But I don't think we can say that all state 
administration and power has been lost in places in Mexico.
    Mr. Connolly. That is a fair point. But I think, would you 
agree though, that obviously one of the challenges of the 
relatively new government is they are going to have to 
reestablish authority in some places where the previous 
government clearly lost it?
    Ms. Jacobson. Well, I think one of the challenges is how do 
you strengthen government institutions against transnational 
criminal organizations which need them weak, either weak or 
nonexistent in order to carry out their business, right, and 
use violence as a tool to do that?
    Mr. Connolly. Yes.
    Ms. Jacobson. So absolutely.
    Mr. Connolly. Speaking of violence, when I was last in 
Mexico we met with the previous Attorney General of Mexico. And 
when we asked him what is the single most important thing the 
United States could do to help you with this outbreak of 
violence and challenge reassertion of state control in the 
northern part of the country, the single thing without 
hesitation, he didn't think, the single thing he cited was that 
the United States should reauthorize the assault weapons ban. 
Do you understand why he would answer that way?
    Ms. Jacobson. I believe I do understand why he would answer 
that way.
    Mr. Connolly. Could you elaborate for the record? Why is 
that important?
    Ms. Jacobson. Well, certainly I, and I think both of my 
colleagues here can testify to the fact that we have certainly 
heard from our Mexican counterparts numerous times their 
concern and frustration with the amount of weapons in Mexico.
    Mr. Connolly. All which are coming through the north. Is 
that correct? Or a lot of them.
    Ms. Jacobson. I don't actually know what the composition 
is, but it is certainly their perception, and it seems to be 
the reality, that a great number of them do come from the 
United States. And it is obviously very, very difficult to own 
weapons in Mexico. So they have done, they believe, what they 
can within the country and are frustrated with the, actually 
what they are frustrated with, I think, is the advanced 
weaponry that they face from these cartels wherever they may 
get it.
    Mr. Connolly. Yes. I just think that is really important, 
and it is not part of our discussion up here for political 
reasons, but our neighbor to the south says that is a critical 
component of our assistance.
    Ms. Jacobson. Yes, sir.
    Mr. Connolly. Let me ask both you and Ambassador Brownfield 
my last question. Could you just elaborate a little bit? There 
were concerns that President Pena Nieto did not have the same 
commitment against the drug cartels that his predecessor did 
and that cooperation with the United States would be diminished 
in a Nieto government.
    Could you each comment on your sense of how things have 
changed or stayed the same or gotten better or worse with the 
transition of governance in Mexico?
    Mr. Brownfield. I will start, Congressman, first, by saying 
as I think I said in my opening statement that we, in fact, are 
both satisfied, pleased with the commitment and the cooperation 
of the Pena Nieto administration to this joint shared security 
effort. There was a period, call it the break-in period for a 
new administration, where the communication was paused, where 
we did a mutual review where we determined what would be the 
system, the structure and the means by which we would make 
decisions and what we would decide on.
    It is our judgment that this now not-so-new government has 
kept the basic four pillars of our cooperation, but has 
adjusted the priorities to some extent. More focus on crime 
prevention, particularly in the larger cities, and perhaps less 
focus on targeting the specific criminal organizations. That 
said, it was this government that produced the successful Chapo 
Guzman takedown operation 3 months ago, which I noted in my 
opening statement was perhaps the most important law 
enforcement operation since Pablo Escobar was perforated by the 
Colombians some 20 years ago in Medellin.
    They have focused as well on more community development and 
support. This is well within the range of the pillars that we 
had agreed to. In other words, I would say we have adjusted our 
cooperation but I would not, in fact, I would be the last one 
to say that this government has walked away from or decided not 
to support the efforts.
    Ms. Ros-Lehtinen. Thank you so much.
    Mr. Sherman, to wrap up?
    Mr. Sherman. Thank you. You are almost done.
    Ms. Jacobson. As long as you want, Mr. Sherman.
    Mr. Sherman. I would like to focus on the economics. We 
have got a $60 billion trade deficit with Mexico. Part of that 
is because we import petroleum from Mexico, but frankly we 
should be able to pay for our petroleum with the goods that we 
export. In this committee, often there is discussion of U.S. 
restrictions on the export of natural gas.
    Ms. Jacobson, it is my understanding that because of NAFTA 
there is not a restriction of our export of natural gas to 
Mexico. Are there legal barriers imposed by the Federal 
Government to exporting natural gas to Mexico?
    Ms. Jacobson. I am going to have to get back to you, Mr. 
Sherman. Sorry.
    Mr. Sherman. Okay, thank you. Ms. Jacobson, what can we do 
to increase American exports to Mexico, excluding the natural 
gas issue?
    Ms. Jacobson. Right. I think one of the things that we feel 
is critically important, and that the President is focusing on, 
is focusing on small- and medium-sized businesses in the United 
States which could export and don't right now. That is part of 
what the President's National Export Initiative was about. 
There are opportunities that we think they could take advantage 
of and that is what we are trying to do. There are small 
business development centers that have opened in Mexico to try 
and----
    Mr. Sherman. Does Mexico have non-tariff barriers to our 
exports?
    Ms. Jacobson. I don't know that I can answer that in any 
sweeping sense. I imagine there are----
    Mr. Sherman. Is there any----
    Ms. Jacobson. There are trade cases that are underway in 
some areas right now certainly.
    Mr. Sherman. What practices of the Mexican Government have 
we questioned or called to task or asked to be changed to allow 
our exports in?
    Ms. Jacobson. I am going to have to get you a better 
rundown of this, I don't want to sort of seat-of-the-pants the 
answer to that question.
    Mr. Sherman. I understand your situation. We are in 
agreement about the State Department. When you deal with the 
foreign ministries of other countries, the persons holding your 
position would be first, second, and third, economics and 
pushing exports, and everything else we have talked about would 
be fourth, fifth and sixth. And the State Department is, of all 
the foreign ministries in the world, the least focused on 
exports. I am sure you do something, but if you compare your 
efforts to the foreign ministries of other countries, it is not 
the culture over there.
    Ms. Jacobson. I would hate to have my weakness on this 
performance today speak for my colleagues.
    Mr. Sherman. I have been here for 18 years. I had that 
opinion before I walked in the room. You have done nothing----
    Ms. Jacobson. I have done nothing to dispel it 
unfortunately----
    Mr. Sherman. Nothing to dispel it but----
    Ms. Jacobson [continuing]. But we will get back.
    Mr. Sherman [continuing]. What hearing couldn't increase it 
or decrease it? It is built on 18 years of sitting in this 
room. And even if you are up on all of that it wouldn't change. 
It wouldn't erase 18 years. And it is hard. It is hard to go 
back to our districts and talk about the need to be involved in 
foreign affairs when we are involved in foreign affairs far 
more than any other country and we have the biggest trade 
deficit of any other country, of any country by far.
    Let us see, in any case can you comment on the economic 
reforms of the new President? He has been able to enact most of 
them, and how do you think these reforms will affect U.S. 
investment in Mexico?
    Ms. Jacobson. Well, I do think that in two particular 
areas, we talked a little bit earlier about the energy reform. 
I think the energy reform is critical. It is obviously critical 
for Mexicans, but I think it is very important for U.S. 
investor possibilities. This is for Mexicans to decide. This is 
an issue of great sensitivity in Mexico.
    Mr. Sherman. Well, it dramatically affects the entire world 
in that if we can increase production in North America----
    Ms. Jacobson. Crucial.
    Mr. Sherman [continuing]. We can, I mean we just fought a 
war in Iraq that I have been told wasn't about oil, but oil 
supplies are a critical national security interest.
    Ms. Jacobson. Well, and clearly North American energy 
production of all types is increasing and that is very, very 
good for us and our energy security. But I also think the 
telecommunications reform is crucial, and the 
telecommunications market in Mexico is one of great interest, I 
think, to U.S. investors and opportunities for the United 
States and our businesses.
    Ms. Ros-Lehtinen. Thank you so much, Mr. Sherman.
    Mr. Sherman. So in our second round I will talk to 
Ambassador Brownfield, and in our third round I will talk to 
Ms. Hogan.
    Ms. Ros-Lehtinen. Well, thank you to the panelists. I hope 
that Secretary Kerry brings up Andrew's case during his 
upcoming trip to Mexico. And as we wrap up we want to say happy 
birthday to Ambassador Brownfield. Feliz cumpleanos, since it 
is Mexico.
    Mr. Brownfield. I am 39 years old now, Madam Chairman.
    Ms. Ros-Lehtinen. And holding. This committee is adjourned.
    [Whereupon, at 12:15 p.m., the committee was adjourned.]
                                     

                                     

                            A P P E N D I X

                              ----------                              


         Material Submitted for the RecordNotice deg.


               \\ts\




\s\t 
                      \






\s\t 
                      \




\
                      statt\


                                 
