[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]
HOW THE COMPACTS OF FREE ASSOCIATION SUPPORT U.S. INTERESTS AND
COUNTER THE PRC'S INFLUENCE
=======================================================================
OVERSIGHT HEARING
BEFORE THE
INDO-PACIFIC TASK FORCE
OF THE
COMMITTEE ON NATURAL RESOURCES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED EIGHTEENTH CONGRESS
FIRST SESSION
__________
Wednesday, June 14, 2023
__________
Serial No. 118-38
__________
Printed for the use of the Committee on Natural Resources
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://www.govinfo.gov
or
Committee address: http://naturalresources.house.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
52-524 PDF WASHINGTON : 2023
COMMITTEE ON NATURAL RESOURCES
BRUCE WESTERMAN, AR, Chairman
DOUG LAMBORN, CO, Vice Chairman
RAUL M. GRIJALVA, AZ, Ranking Member
Doug Lamborn, CO Grace F. Napolitano, CA
Robert J. Wittman, VA Gregorio Kilili Camacho Sablan,
Tom McClintock, CA CNMI
Paul Gosar, AZ Jared Huffman, CA
Garret Graves, LA Ruben Gallego, AZ
Aumua Amata C. Radewagen, AS Joe Neguse, CO
Doug LaMalfa, CA Mike Levin, CA
Daniel Webster, FL Katie Porter, CA
Jenniffer Gonzalez-Colon, PR Teresa Leger Fernandez, NM
Russ Fulcher, ID Melanie A. Stansbury, NM
Pete Stauber, MN Mary Sattler Peltola, AK
John R. Curtis, UT Alexandria Ocasio-Cortez, NY
Tom Tiffany, WI Kevin Mullin, CA
Jerry Carl, AL Val T. Hoyle, OR
Matt Rosendale, MT Sydney Kamlager-Dove, CA
Lauren Boebert, CO Seth Magaziner, RI
Cliff Bentz, OR Nydia M. Velazquez, NY
Jen Kiggans, VA Ed Case, HI
Jim Moylan, GU Debbie Dingell, MI
Wesley P. Hunt, TX Susie Lee, NV
Mike Collins, GA
Anna Paulina Luna, FL
John Duarte, CA
Harriet M. Hageman, WY
Vivian Moeglein, Staff Director
Tom Connally, Chief Counsel
Lora Snyder, Democratic Staff Director
http://naturalresources.house.gov
------
INDO-PACIFIC TASK FORCE
AUMUA AMATA C. RADEWAGEN, AS, Chair
GREGORIO KILILI CAMACHO SABLAN, CNMI, Co-Chair
Bruce Westerman, AR Raul M. Grijalva, AZ
Doug Lamborn, CO Ruben Gallego, AZ
Robert J. Wittman, VA Katie Porter, CA
Tom Tiffany, WI Teresa Leger Fernandez, NM
Jim Moylan, GU Melanie A. Stansbury, NM
Harriet M. Hageman, WY Ed Case, HI
------
CONTENTS
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Page
Hearing held on Wednesday, June 14, 2023......................... 1
Statement of Members:
Radewagen, Hon. Aumua Amata Coleman, A Delegate in Congress
from the Territory of American Samoa....................... 1
Sablan, Hon. Gregorio Kilili Camacho, A Delegate in Congress
from the Territory of the Northern Mariana Islands......... 3
Westerman, Hon. Bruce, a Representative in Congress from the
State of Arkansas.......................................... 4
Grijalva, Hon. Raul M., a Representative in Congress from the
State of Arizona........................................... 5
Statement of Witnesses:
Short, Albert V., Colonel, U.S. Army (Ret.), Former Chief
Negotiator for 2003 Compact of Free Association, Lorton,
Virginia................................................... 6
Prepared statement of.................................... 8
Questions submitted for the record....................... 11
Lum, Thomas, Specialist in Asian Affairs, Congressional
Research Service, Washington, DC........................... 13
Prepared statement of.................................... 15
Questions submitted for the record....................... 21
Paskal, Cleo, Non-Resident Senior Fellow, Foundation for
Defense of Democracies, Washington, DC..................... 27
Prepared statement of.................................... 29
Questions submitted for the record....................... 37
Newsham, Grant, Colonel, U.S. Marine Corps (Ret.), Honolulu,
Hawaii..................................................... 39
Prepared statement of.................................... 41
Questions submitted for the record....................... 48
OVERSIGHT HEARING ON HOW THE COMPACTS OF FREE ASSOCIATION SUPPORT U.S.
INTERESTS AND COUNTER THE PRC'S INFLUENCE
----------
Wednesday, June 14, 2023
U.S. House of Representatives
Indo-Pacific Task Force
Committee on Natural Resources
Washington, DC
----------
The Task Force met, pursuant to notice, at 10:03 a.m. in
Room 1324, Longworth House Office Building, Hon. Aumua Amata
Coleman Radewagen [Chairwoman of the Task Force] presiding.
Present: Representatives Radewagen, Westerman, Lamborn,
Wittman, Tiffany, Moylan, Hageman; Sablan, Grijalva, Gallego,
Porter, Stansbury, and Case.
Mrs. Radewagen. The Indo-Pacific Task Force will come to
order.
Without objection, the Chair is authorized to declare a
recess of the Task Force at any time.
The Task Force is meeting today to hear testimony on how
the Compacts of Free Association support U.S. interests and
counter the PRC's influence.
Under Committee Rule 4(f), any oral opening statements at
hearings are limited to the Chair and the co-Chair. I therefore
ask unanimous consent that all other Members' opening
statements be made part of the hearing record if they are
submitted in accordance with Committee Rule 3(o).
Without objection, so ordered.
I ask unanimous consent that the gentlewoman from Puerto
Rico, Mrs. Gonzalez-Colon, be allowed to sit and participate in
today's hearing.
Without objection, so ordered.
I will now recognize myself for an opening statement.
STATEMENT OF THE HON. AUMUA AMATA COLEMAN RADEWAGEN, A DELEGATE
IN CONGRESS FROM THE TERRITORY OF AMERICAN SAMOA
Mrs. Radewagen. Talofa lava and good morning. There is no
more fitting way for me to begin this proceeding than to
express my heartfelt gratitude to Chairman Westerman and
Ranking Member Grijalva for entrusting this mission to me as
Chair, and to my esteemed Pacific Island colleague from CNMI,
the Honorable Gregorio Kilili Sablan, as co-Chair. By doing so,
they have empowered the people of the Pacific Islands, whose
past and future under the American flag comes first in our
minds and our hearts.
Our duty is to better enable the House Natural Resources
Committee and Congress to determine how best to protect
American values and interests in the Pacific. Chairman
Westerman and Ranking Member Grijalva, with the help of the
distinguished members of this Task Force, we won't let you
down.
The Pacific region is critical for U.S. interests and
security. The United States has a vested interest in and duty
to protect U.S. homeland territories like my home, American
Samoa, and the Freely Associated States from rising influence
from the People's Republic of China. The Compacts of Free
Association are vital to that endeavor and the broader U.S.-
China competition.
My work on this enterprise is informed by my participation
in the September 2022 Pacific Island Leaders Conference in
Honolulu with heads of State and Government from the PIF
nations, including FAS and chief executives from U.S.
territories. I also participated in the first-ever U.S. Pacific
Islands Country Summit held in Washington, DC. I approach this
Task Force with a keen recollection of my participation in the
U.S. Pacific Islands Summit declaration that confirmed that
COFA is a high priority and one of the cornerstones of U.S.
Pacific cooperation.
I was reminded of these historic gatherings of U.S. and
Pacific Island leaders when I recently had the honor of
attending the sovereign nation of Samoa's Independence Day
celebration earlier this month at the invitation of my friend,
Prime Minister Afioga Fiame Naomi Mata'afa. While joining her
and other heads of State and Government in Apia, the message I
heard was loud and clear: The United States must continue to
engage in the historic relations with the U.S. territories or
its FAS partners.
As we gather now for this Task Force hearing, we must
continue to show our commitment to the region, and our resolve
to challenges, and respond to any threat posed by the PRC. We
will do this in a manner that meets U.S. interests and supports
Pacific Island communities in our territories and the FAS.
The Indo-Pacific Task Force will enable Congress to rise to
this challenge. The Administration must work with the
leadership of the Committee and Congress to ensure that we have
what we need to enact COFA, and can enact agreements that are
fair and just, reasonable and responsible, and protect both
U.S. interests in the Pacific and the sovereignty of our
Pacific partners.
But this isn't just about U.S. interests, but also that of
the people who live in the FAS. The COFA agreements are a
symbol of democracy, good governance, transparency, and the
rule of law. We have seen in the FAS that the PRC is the
antithesis of those values. We just need to look at President
Panuelo's letter of PRC activities in the FSM.
I want to welcome all the Members who sit on this Task
Force as we address the issues affecting the United States in
the Pacific. We all come from a broad and diverse background, a
key American strength. Through this diversity we will deliver
for the American people as we shepherd the COFA agreements
through Congress and address the issues and challenges the
United States faces in the Pacific. We do this not just for
this generation, but for generations to follow.
The United States will not walk away from its historic
relations with our FAS partners. The whole world is watching
what we do, and our adversaries are going to challenge us on
our commitments. But we are committed to our partners and to
the Pacific.
There is a lot that needs to be done, and I look forward to
getting to work and hearing from our witnesses today.
The Chair now recognizes the co-Chair for any statement.
STATEMENT OF THE HON. GREGORIO KILILI CAMACHO SABLAN, A
DELEGATE IN CONGRESS FROM THE TERRITORY OF THE NORTHERN MARIANA
ISLANDS
Mr. Sablan. Thank you, Madam Chair. Good morning, everyone.
I think, after listening to the Chair's remarks, she has
covered everything else so well. So, I should just yield.
But it is true, today is, indeed, a very important day,
historic in some ways, because it marks the beginning of what I
hope and I believe will be a successful bipartisan effort to
renew the financial provisions of the Compacts of Free
Association and other provisions of the Compacts with our good
friends and neighbors in the Pacific: the Republic of the
Marshall Islands, Palau, and the Federated States of
Micronesia.
There can be no doubt that renewing the financial
provisions of the Compact is essential to our nation's security
posture in the Indo-Pacific region, and will go a long way in
countering adversarial nations' gaining a foothold in the
region, efforts that may have started already.
The United States has enjoyed friendly relations with the
Freely Associated States for more than four decades, and the
people of Micronesia have enjoyed a friendly relationship with
the United States for over 70 years, almost eight decades.
Their representatives are consistently supportive of U.S.
policies at the United Nations and other international
organizations, and their citizens volunteer for the U.S.
military in numbers that are highest per capita than residents
of many of, if not all, the 50 states.
The Compacts give the U.S. responsibility for the COFA
nations' defense, and provide the United States with the
exclusive military use rights. And this relationship enables
the United States to maintain critical access to this strategic
area in the Indo-Pacific region.
I want to commend Chairman Westerman and Ranking Member
Grijalva for creating this Indo-Pacific Task Force to provide
for a bipartisan process for both informing our House
colleagues of the importance of renewing the Compacts and
building support for their passage.
And although there is currently bipartisan support for
renewing the Compacts, our experience with the renewal
agreement of the latest Palau Compact tells us that a more
sustained, robust effort will be required if we are to avoid an
almost decade-long delay in passing these additional renewal
agreements, and this is a really good start.
There is no easy way that our nation will be able to
maintain our influence in what is becoming an increasingly
strategic, important, and contested area of the world without
continuing our partnership with the COFA nations and other
Pacific Island nations. And that partnership must resume by
Congress swiftly passing the Compact renewal agreements as they
are transmitted to us by the Administration.
I commend the work of the Administration Special Envoy,
Ambassador Joseph Yun, and the Assistant Secretary for Insular
Affairs for the tremendous progress achieved in having signed
memoranda of understanding with all three Compact countries on
the basic levels of Compact funding for the next 20 years, and
so far two Compact renewal agreements. I have little doubt that
Ambassador Yun will be able to complete the Compact renewal
with the remaining nation in due time.
I welcome our excellent panel of witnesses, who I suspect
will reinforce the importance of the COFA renewals when we hear
from them shortly.
Thank you, Madam Chair, and I yield back.
Mrs. Radewagen. The Chair will now recognize Chairman
Westerman for his opening statement.
STATEMENT OF THE HON. BRUCE WESTERMAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ARKANSAS
Mr. Westerman. Thank you, Chair Radewagen, and thank you to
the witnesses for being here today.
Today is a significant day, as it marks the inaugural
gathering of this Committee's bipartisan Indo-Pacific Task
Force.
I would like to again take a moment to thank Ranking Member
Grijalva, Chair Radewagen, and co-Chair Sablan for their
efforts in helping in the work to put this important initiative
together.
Acting within the jurisdiction of the House Committee on
Natural Resources, the mission of the Task Force will be to
provide focus and conduct oversight on issues facing the U.S.
territories and the Freely Associated States in the Indo-
Pacific region, including Compacts of Free Association between
the United States and the Freely Associated States.
The People's Republic of China is an existential threat to
the United States. The PRC seeks to undermine U.S. interests in
the Pacific, particularly when it comes to the Freely
Associated States. It is imperative that we find ways to
counter the PRC's malign influence and to protect U.S.
interests in the region.
I think we can all agree, as Americans, that we have a duty
to respond to threats to our homeland and to our friends in the
Pacific. We will meet this threat head on and will not stand
idly by in the face of Chinese aggression.
As we carry out this hearing and complete the future work
of the Task Force, I want to make it clear that when I say and
when other members of the Task Force refer to ``China'' and
``Chinese influence,'' we are referring to the Chinese
Communist Party. We recognize and firmly believe in the
distinction between the totalitarian regime in Beijing and the
Chinese people who long for democracy and freedom from
autocratic rule.
With that in mind, this Task Force looks to find an
appropriate response to rising Chinese influence in the
Pacific. Countering Chinese influence is a major challenge, as
the PRC often operates within the gray zone. This makes it
difficult to find a reciprocal response, so we must find and
understand measures within our toolkit that enable the United
States to push back against PRC malign activity.
The Compacts of Free Association are one such measure. The
Compacts are critical to the future of the U.S. and the Freely
Associated States relationship. Thus, we are gathered here
today to hear from this excellent panel of witnesses to better
understand the Compacts of Free Association and how they
support U.S. interests and counter the PRC's influence.
This hearing will lay the groundwork for future hearings
and Committee review, and as we review the newly-negotiated
Compact agreements. There will be tough issues that we will
need to work out when the appropriate time comes, but I hope
this hearing will provide the basis for this Task Force to
carry out its important mission.
Thank you, Madam Chair, and I yield back.
Mrs. Radewagen. The Chair will now recognize Ranking Member
Grijalva for his opening statement.
STATEMENT OF THE HON. RAUL M. GRIJALVA, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ARIZONA
Mr. Grijalva. Thank you very much, Madam Chair. And as co-
Chair Sablan mentioned, I associate myself with the comments
that you made in your opening comments, as well as Chairman
Westerman.
I am grateful for both your leadership on this Task Force,
and I should say that I am very appreciative of Chairman
Westerman's raising the profile of this part of our
jurisdiction to this Task Force and to the importance of what
we are going to be discussing here. It is very much
appreciated, very much needed. And any time the Little
Committee That Could can raise its profile and assert its
jurisdiction, it is a good thing.
[Laughter.]
Mr. Grijalva. For nearly four decades, the United States
has maintained a special relationship with the Freely
Associated States. Through agreements known as the Compacts of
Free Association, the United States and these sovereign
countries have outlined a mutually beneficial relationship that
provides the United States important military access to the
Pacific in exchange for the United States supporting the Freely
Associated States economically, and allowing their citizens to
live, study, and work in the United States.
The United States' ability to deliver on its duty to the
Freely Associated States and the U.S. territories of the
Pacific is directly related to the prevention of the People's
Republic of China's Government's further encroachment in the
region, and the endurance of our aligned defense and security
interests.
The Chinese Government, as Chairman Westerman mentioned,
knows that the weaker the economies in the Indo-Pacific region
are, the more power and influence they will have in the region.
That is why it is so important to remember that our
relationship with the Freely Associated States and the U.S.
territories in the Pacific is not a one-sided situation. It is
a mutually beneficial relationship.
I want to reiterate that as the Task Force begins its work
to examine the significant military and security value of the
Pacific Islands, we cannot lose sight of our responsibility to
the Freely Associated States and U.S. territories in the region
and to their people.
I also want to emphasize that Congress doesn't have time to
lose in negotiating the new Compacts of Free Association if we
want to maintain long-term stability. The Task Force must keep
these challenges in mind. And as we consider solutions for our
mutual defense, national security, and economic interest, this
Task Force will play a significant role in that process.
And with that, Madam Chair, I yield back.
Mrs. Radewagen. I will now introduce our witnesses.
Mr. Albert V. Short, Colonel, U.S. Army, retired, and
former Chief Negotiator for the 2003 Compact of Free
Association, Lorton, Virginia; Dr. Thomas Lum, Specialist in
Asian Affairs, Congressional Research Service, Washington, DC;
Ms. Cleo Paskal, Non-Resident Senior Fellow, Foundation for
Defense of Democracies, Washington, DC; and Mr. Grant Newsham,
Colonel, U.S. Marine Corps, retired, Honolulu, Hawaii.
Let me remind the witnesses that, under Committee Rules,
they must limit their oral statements to 5 minutes, but their
entire statement will appear in the hearing record.
To begin your testimony, please press the talk button on
the microphone.
We use timing lights. When you begin, the light will turn
green. When you have 1 minute left, the light will turn yellow.
And at the end of 5 minutes, the light will turn red and I will
ask you to please complete your statement. I will also allow
all witnesses on the panel to testify before Member
questioning.
The Chair now recognizes Mr. Short for 5 minutes.
STATEMENT OF ALBERT V. SHORT, COLONEL, U.S. ARMY (RET.), FORMER
CHIEF NEGOTIATOR FOR 2003 COMPACT OF FREE ASSOCIATION, LORTON,
VIRGINIA
Mr. Short. Good morning, Madam Chair, Ranking Members of
the Subcommittee. I am Albert V. Short, Colonel, U.S. Army,
retired, and former Chief of Staff in the office that
established the Compacts of Free Association enacted in 1986.
Twenty years later, I was chief negotiator on the amended
Compacts of Free Association in 2003. This time around, I am
leaving all the heavy lifting to others, so today my remarks
are my opinions, and not on behalf of the Administration, other
persons, organizations, or institutions.
First, I must commend the Committee for conducting this
series of hearings that focuses on the strategic imperatives in
the region, including the renewal of the Compacts, but taken
into the context of the threat and the impending threats posed
by the People's Republic of China, the PRC.
The renewal of the Compacts is based on proposals being
negotiated by the Administration, and will be ultimately
approved by the Congress. It is an urgent matter, and it
supports U.S. interests not only in Micronesia, but in the
broad Indo-Pacific Region.
One really cannot examine U.S. interests in Micronesia and
the Pacific Islands in general without harkening back and
considering World War II, where we experienced 100,000
casualties and expended hundreds of millions of dollars in
capturing these and other islands on the march to Japan.
I joined the negotiations in 1979, and at that time there
was still a number of World War II veterans in the Congress,
and their very clear and strong guidance to the Administration
was, ``You must bring to this body Compacts that include
strategic denial.''
Well, what is strategic denial? Really, it is the ability
of the United States to foreclose this area, not only the
islands, but also the waters and airspace from any third party.
Further, we have that right, even if the Compact is terminated,
so it is a unilateral right on the part of the United States to
continue or to terminate.
Separate from this standalone strategic denial that I just
spoke about, as long as the Compact is in effect, the FAS
governments, the foreign Freely Associated State governments,
have the obligation to cease and desist from any action that
the United States unilaterally determines is prejudicial to our
defense and security arrangements. It is a very, very powerful
provision.
Fortunately, for now over 40 years, we have never had to
invoke our defense prerogatives. However, with the ever-
increasing influence of the PRC, we can't forecast or preclude
the use of that authority in the future.
The Compacts of Free Association have been very much of a
success story. But a high priority for the PRC has been to
basically disrupt and undermine the authorities that are
contained in the Compacts.
Really, what are our defense and security benefits that
directly accrue to the United States from the Compact
relationship?
And further, why should the Congress approve these
Compacts?
And will they support our interests, long term?
First, it will continue an 80-year relationship, 40 years
under the Compacts of Free Association.
Second, it will support democratic governments that serve
as a role model for others in the Pacific and elsewhere.
Third, the FAS serves as a bulwark for our defense and
security concerns in the North Pacific. It protects our vital
sea and air lines of communication to Asia. This is, if you
will, the second tier when you look at it through the prism of
the PRC.
Fourth, we have the right to install defense and security
installations as needed.
Fifth, the Kwajalein facility is a key element in our space
and missile defense development programs. And DoD has recently
announced the forthcoming installation of a radar facility in
Palau focused on North Asia.
Sixth, our capability to deny any third-party access to the
Freely Associated States and their economic zones effectively
neutralizes this area in the Pacific.
So, the Congress soon will be called upon to approve the
renegotiated Compacts, and this endeavor should set a course
correction for our relationship not only with the Freely
Associated States, but with the region.
Again, I thank the Chair, the Majority, and the Ranking
Member for the opportunity to appear today, and I look forward
to your questions. Thank you.
[The prepared statement of Mr. Short follows:]
Prepared Statement of Albert V. Short, Colonel, U.S. Army (retired);
Former, Chief Negotiator, Amended Compacts of Free Association, 2003
Good morning, Chair, ranking member, and distinguished members of
the Subcommitee. I am Albert V. Short, Colonel U.S. Army (retired),
former Chief of Staff in the Offce for Micronesian Political Status
Negotiations in the NSC 1979 to 1986, and Chief Negotiator on the
Amended Compacts of Free Association, in 2003. This time around, I am
leaving all the heavy lifting to others, thus my remarks are my
opinions and not any other person, organization, or institution.
I commend the Commitee for conducting this series of hearings to
focus on the strategic imperatives in the region, including renewal of
the Compacts in the context of the threats posed by the People's
Republic of China, (PRC) in the Indo-Pacific region.
This morning, I will address how the Compacts of Free Association
support U.S. interests in the Indo-Pacific region and I'll highlight
the urgency of renewing these compacts in this session of Congress.
There were two seminal events in the 1970s that shaped our
relationship with the Freely Associated States, (FAS). One was the
formation of the Congress of Micronesia which was the first
comprehensive attempt at self-government instituted by the then Trust
Territory Administration. Second, was the so-called Hilo Principles
which were negotiated in Hawaii in the late 70s and set the parameters
for the free association relationship with what was to become Palau,
the Federated States of Micronesia, and the Republic of the Marshall
Islands.
The Hilo Principles recognized the benefits to the U.S. and the new
island governments of a transition from trusteeship to sovereignty
consistent with the right of independence for the Micronesian States,
including their ability to carry out the functions of government in
their own name and right, and to conduct their own foreign affairs,
with the one caveat that the United States would be responsible for
their security and defense.
Those underlying goals embodied in the so-called Hilo Principles
and the Compact continue to guide our relationship now through three
cycles of the compacts for nearly 50 years . . . so we must be doing
something right.
I should note that the chairperson, Representative Radewagen, has a
direct connection to the early development of democracy in the then
Trust Territory. Her father, Peter Coleman, was the first Samoan
graduate from Harvard University, and was at that time the acting High
Commissioner and the Deputy High Commissioner in the Trust Territory
when the Congress of Micronesia was formed, and the process of self-
government commenced. She was raised in the Marshall Islands and
Saipan, if I am not mistaken, and has first-hand knowledge and
understanding of how the U.S.-Freely Associated State relationship has
prospered over these many years.
One cannot examine U.S. interests in Micronesia, and the Pacific
Islands in general without taking into consideration World War II where
we experienced 100,000 casualties and expended hundreds of millions in
capturing the islands on the march to Japan and the wars end.
I joined the U.S. negotiating team in 1979 and at that time there
were still many World War II veterans in Congress and their guidance to
the administration was clear: Do not bring compacts to this body that
do not include strategic denial so we will not have to liberate these
islands again from a new enemy.
While these memories may dim with the passage of the so-called
``greatest generation'' the need for security in this area has
transitioned to a newer generation.
What is strategic denial? It is the ability of the United States to
foreclose the area not only to the islands, but also the waters and
airspace from any third party. Further, we have the right to request
the Micronesian government to cease and desist from any action that we
unilaterally determine is prejudicial to our defense and security
responsibilities in their domain.
Thus, we have provided a security guarantee to Micronesia much more
all-encompassing than we have for any other ally, including NATO.
Fortunately, we have never had to invoke our defense prerogatives
in the Freely Associated States, however, with the ever-encroaching
influence of the People's Republic of China (PRC) we cannot foreclose
or forecast the use of this authority in the future.
The Micronesian States are sovereign. They conduct their own
foreign affairs, and domestic activities and govern themselves with the
one exception that the United States is totally responsible for their
security and defense. They are members of the United Nations and in
that context have been very helpful to the United States interests in
the U.N. and elsewhere.
Regarding the PRC, I will make passing reference to the threat and
later speakers will get into much more detail. I will focus on how the
compacts directly support our interest in the region.
Why are we interested in this far-flung area in the middle of the
North Pacific?
First, it is a huge area when you include the Exclusive Economic
Zones (EEZs) of the three Freely Associated States. This is an area
approximately 3000 miles East to West, and 1000 miles North to South
that stretch stretches from west of Hawaii almost to the Philippines.
It is astride the main logistical route between the United States and
Asia, so anyone who controls this area controls communication to the
so-called frontline States . . . Korea, Japan Taiwan Philippines, and
Southeast Asia.
Worldwide shipping in the Pacific either leaves North Asia, China,
Philippines and Southeast Asia and transits west to the U.S. West coast
or the Panama Canal via Micronesian territorial waters. Otherwise, it
goes south through the South China Sea and the Straits of Malacca, and
we are all aware of what the Chinese are doing in the South China Sea.
We don't want to see the same sort of activity in the central Pacific.
When we consider the Freely Associated States (FAS) and the
associated compacts supporting our national interests, the first issue
is simply location, location, location . . . It is like real estate.
The FAS sit squarely on the main communications line between our West
Coast, Hawaii and the Asian literal.
The compacts and their subsidiary agreements include several
Military Use and Operating Rights Agreements with the principle one for
the space and missile test range activity at Kwajalein Atoll in the
Marshall Islands. This is our only long-range missile test facility
where we can fire missiles from the U.S. West Coast or at sea into the
Kwajalein lagoon. We have used this facility for many years and in 2003
we renegotiated the lease for 50 years. This is a one-of-a-kind
facility and vital for testing our strategic capabilities.
Recently, the Department of Defense (DoD) has announced that they
intend to develop a technical radar communications facility at Angaur
island in the Palau archipelago.
We have military operating rights in all the FAS most of which have
not been used over the years, but they are there should the need arise.
The United States appears to be emerging from a period when it took
the Indo-Pacific Island States for granted and this has provided an
opportunity for others to make gains at our expense.
The PRC threat to the Freely Associated States and ultimately the
U.S. territories and the Indo-Pacific area is rather unique. In the
1980s, Khruschev went to Vladivostok and made a statement ``we are a
Pacific power''. Everyone got concerned about Russian expansion in the
area, however that activity pales into insignificance compared to the
present and potential future actions by the PRC.
In understanding the PRC threat, we must get beyond our usual
binary thinking where on one hand you have peace, and on the other you
have war . . . this is an on/off switch. In the PRC view they deal with
political warfare, a concept called ``struggle''. There is a continuum
of actions all coordinated . . . military, economic, political, social,
all focused on a common goal with many intermediate activities that
support the end game. We must start thinking out-of-the-box when we are
responding to, and hopefully preempting PRC activities that are
detrimental to our interests.
While we address the support that the compacts provide to the
United States, we also must recognize that the Freely Associated States
have certain characteristics that make them vulnerable to third party
exploitation:
They are remote and geographically isolated in the central
pacific,
They have a very thin population, about 200,000,
They lack natural resources (except fish),
They have poor infrastructure and generally fragile
governments because of the small population and weak
economy.
While the Freely Associated States have made significant progress
in the last 40 years, with the noted shortcomings they still will
require U.S. assistance. This includes programmatic support especially
in infrastructure, education, and health. The compacts as renegotiated
will continue grant assistance for another 20 years again with emphasis
on infrastructure, health, and education.
The Compacts of Free Association provide a framework for a
relationship but that is the formal side. To be effective the
relationship must be much deeper than a piece of paper and a few
signatures. Over 40 years, we have built an effective relationship with
the Micronesian States, but it can always be beter. When we are seeking
to support our long-term interests, people to people relationships-
built over time and built on common bonds our key.
The Peace Corps is a classic example of relationship building.
During the trusteeship, we had more Peace Corps volunteers in
Micronesia than anywhere else in the world. However, that program was
ended, perhaps for all the wrong reasons. It is now time to reestablish
the Peace Corps in Micronesia and build grassroots relationships, as we
did in the 60s and 70s.
We have U.S. embassies in all the Micronesian capitals and capable
foreign service personnel and local nationals who solve low levels and
sometimes high-level issues that come between any two nations on a
daily basis.
CINCPAC, in Hawaii, has been a key element in building effective
relations with the Micronesian States. On one hand it facilitates
Micronesian recruitment for the U.S. armed forces where they serve in
large numbers. It also has frequent meetings and exchanges in Honolulu
and in the FAS on security and defense issues.
In these small nations, person-to-person communication is perhaps
more vital then when dealing with NATO or Japan or some other world
power.
Supporting U.S. interests also includes ensuring that the economic
and other support that we provide to the Freely Associated States are
properly spent and achieves the results for which the money was
provided.
This can create a problem. On the one hand the Freely Associated
State is cognizant of their sovereignty and its right to run their own
affairs. On the other hand, from the U.S. perspective, we are providing
significant U.S. support, and we want to ensure that it goes for the
intended purpose. The issues are accountability by the donor and
sovereignty on the part of the recipient.
In the first compacts, the U.S. simply wrote checks to the
Micronesian governments. While there was guidance in the compacts as to
where the money was supposed to go there was litle oversight and
accountability and the results were less than satisfactory. The result
was a burgeoning bureaucracy and key elements such as education,
health, and infrastructure were neglected.
In the amended compacts (2004), we developed a Fiscal Procedures
Agreement based on the concept that the funds received by the FAS
should be accounted for on the same basis as federal funds provided to
state and local governments.
There was some resistance on the part of the FAS to this fiscal
oversight, but we worked out an acceptable agreement that has been
administered by the Office of Territorial Affairs in the Department of
the Interior and it has worked reasonably well for the last 20 years.
The success of this oversight is not necessarily based on the
agreement, but the people who implemented it, they were primarily
career civil service employees in the Department of the Interior,
including former Peace Corps volunteers, who worked constructively with
the Micronesian governments to ensure that our funds were properly
spent and accounted for.
The General Accounting Office (GAO) conducted oversight in the
Trust Territory and then in the Freely Associated States for many
years. As the chief negotiator in 2003, I found their reports very
useful in framing the Fiscal Procedures Agreement. I understand, the
GAO has cut back on some of their Micronesian oversight and it's time
to reenergize them.
The first step in achieving U.S. interests in the Freely Associated
States, and in the wider Indo-Pacific is to have a coordination
mechanism within the executive branch, with consultation, and
concurrence by the Congress on are our goals and the best methods to
achieve them. Today we simply do not have such a mechanism in the
executive branch.
Within the Department of Interior, we have the Office of
Territorial Affairs which looks after territories as well as the Freely
Associated States, and it has done a decent job of fiscal oversight in
the last 20 years.
At the State Department when the compacts were first implemented
there was an Office of Freely Associated State Affairs in the Asia
Pacific Bureau established to oversee the compacts relationship and
provide the long-term continuity required for oversight implementation,
and accountability, etc. Unfortunately, the State Department, after a
couple of years, reorganized and the office was closed. The FAS
responsibility was sublimated to a desk officer whose responsibility
included several other Pacific Island nations and he/she in turn was
under the umbrella of the Australia, New Zealand, and Pacific Islands
Office. Also, the State Department career foreign service officers
return to the U.S. for a couple of years after being overseas, but in
two years they are gone, and you had a new person on the learning
curve.
In the Department of Defense, you have incidental interest in the
Pacific Islands except for CINCPAC, in Honolulu.
At the Washington level this begs the question, who is in charge of
securing our vital interests and countering PRC influence? Right now, I
simply don't know. It's time to establish, perhaps in the NSC, a
mechanism to pull together and coordinate all U.S. assets and concerns
in this area.
The administration has made progress on the renegotiation of the
Compacts of Free Association and has signed documents with the FSM, and
Palau, with RMI still holding out . . . I understand the goal is to
present the compacts to Congress in this session for your hopefully
expeditious consideration.
Summary:
What defense and Security benefits accrue to the United States from
the Compacts of Free Association?
Why should the Congress approve the Compacts and how will they
support our interests in the Indo-Pacific area?
First, it will continue 40 years of tested relations with
the Freely Associated States,
Second, it will support democratic governments that serve
as a role model for others in the Pacific and elsewhere,
Third, the FAS serve as a bulwark for the defense and
security in the North Pacific and protects our vital sea
lines to Asia,
Fourth, we have the right to install defense and security
installations, as needed,
Fifth, the Kwajalein facility is a key element in our
space and missile deployment programs,
Sixth, our capability to deny any third-party access to
the Freely Associated States and their EEZ's effectively
neutralizes a huge area of the North Pacific.
The United States is actively engaged in renegotiating the
compacts, that activity in of itself demonstrates commitment and with
their conclusion this year and hopeful approval by the Congress, it
will set a course correction for our relationship not only with the
Freely Associated States, as we go forward, but also with the entire
region.
Again, I thank the chair and ranking member for the opportunity to
appear before you today and I look forward to your questions. Thank
you.
______
Questions Submitted for the Record to Albert V. Short, Colonel, U.S.
Army (Ret.); former Chief Negotiator for 2003 Compact of Free
Association
Questions Submitted by Representative Westerman
Question 1. We are seeing the PRC become increasingly effective in
conducting its influence operations in the FAS.
Is this a result of low U.S. engagement in the region, increasing
efforts and resources by the PRC for its influence operations, or
conditions in the FAS?
Answer. Congressman Westerman, your question correctly addresses
three areas which collectively contribute to the increasing People's
Republic of China (PRC) influence in the Pacific Islands, with specific
reference to the Freely Associated States (FAS), the Republic of Palau,
the Federated States of Micronesia, and the Republic of the Marshall
Islands. Also, we cannot ignore the PRC threat to the U.S. territories
of Guam, the Northern Marianas, and even American Samoa.
Your first question: Is this the result of low U.S. engagement in
the region? The short answer is YES!
Historically, we have left many Pacific Island engagement decisions
to Australia and New Zealand. There is nothing wrong with that
approach, they are valuable long-term partners in the Asia Pacific,
however we should not neglect the area and simply feel that somebody
else is taking care of our problems.
U.S. focus on this area has been less than optimum for years. What
we need is a long-term strategy that addresses our strategic
objectives, considering the threating PRC activities, and in the
context of the PRC's worldwide ``belt and roads initiative''.
As I noted in my prepared remarks, we need centralized strategic
planning and control at the national level here in Washington, and then
effective long-term implementation on a regional basis. Today, that is
simply lacking. We tend to be transactional by responding to situations
that arise. Rarely are we up front on situations or activities. We are
playing catch up.
Thus, the first step in achieving U.S. interests in the FAS, and in
the wider Indo-Pacific is an effective coordination mechanism within
the Executive Branch, with consultation with the Congress, on our
strategic goals and the best methods to achieve them. Today, we simply
do not have such a mechanism in the Executive Branch.
At the Washington level this begs the question, ``who is in charge
of securing our vital interests and countering the PRC influence?''
Right now, it is simply not clear. It's time to establish, perhaps in
the National Security Council (NSC), a mechanism to pull together and
coordinate all U. S. assets and concerns.
We do not have a strategic view that we implement with actions and
reactions over a long period of time. Thus, we have given the PRC a
great field advantage in conducting their influence activities in the
FAS and throughout the Pacific Islands.
Your second question concerns the significant PRC's influence
operations in the Freely Associated States and the inroads they have
made. First, the PRC activity in the FAS is a subset of their broader
objectives in the indo-Pacific for regional dominance. There is no
question, the PRC is actively seeking regional dominance in the Pacific
Islands, as they have established in the South China Sea.
The PRC is in the game both short term and long term. The recent
tour-de-force by the PRC Foreign Minister throughout the Pacific
Islands clearly highlighted this high-level PRC focus, but it is the
day-to-day activities targeted to subvert the Pacific Islands that are
the real threat.
While the media emphasizes the PRC's large scale infrastructure
projects, what is missed is the low level political and economic
activity such as buying into local businesses, influence operations in
media that support PRC political objectives, social activities such as
friendship organizations, and scholarships for study in China. All this
results in a host of multifaceted economic, social, political,
informational, psychological warfare operations all focused on the goal
and that goal is clearly regional dominance. Regional dominance means
elimination of United States and our allies influence in the area.
Look at the activities of the PRC that go back 20 or 30 years in
the South China Sea where they are claiming total dominance.
We need to take the gloves off with the PRC. As I pointed out in my
remarks at the hearing, the PRC does not play by the rules . . . their
rules are any means to the end and that end is regional domination.
Why is this vast ocean area of interest to the PRC? There are two
main lines of communication, both air and surface, in Asia, one is
through the Straits of Malacca north through the South China Sea, and
the other is across the Pacific through the Pacific Islands. If one
controls both lines of communication, it effectively cuts off the so-
called frontline states, Korea, Taiwan, Japan, Philippines, and others.
You don't have to be a military strategist to realize that should
the PRC be successful in dominating the Pacific Islands and their lines
of communication, it will effectively be a flank attack on our partners
in Japan, Korea, Taiwan, Philippines, and southward.
Your last point concerns the conditions within the FAS which have
facilitated PRC encroachment.
The PRC approach is multifaceted and multiyear, it is economic
penetration and political (especially anti-Taiwan), it is social
activities, it is influence warfare, the entire gamut of national power
and influence operations directed at the governments and people of the
FAS.
As I noted in my prepared remarks, the FAS and by extension all the
Pacific Island nations are vulnerable because:
They are remote, have a very small land mass, and are
geographically isolated in the central Pacific,
They have a very thin population, about 200,000,
They lack natural resources (except fish),
They have poor infrastructure and generally fragile
governments because of the small population and weak
economy.
While the Freely Associated States have made significant progress
in the last 40 years, with the noted shortcomings, they still will
require U.S. assistance. This includes programmatic support especially
in infrastructure, education, and health. The compacts as renegotiated
will continue grant assistance for another 20 years again with emphasis
on infrastructure, health, and education.
The Compacts of Free Association provide a framework for a
relationship, but that is the formal side. To be effective the
relationship must be much deeper than a piece of paper and a few
signatures. Over 40 years, we have built an effective relationship with
the Micronesian States, but it can always be better. As we seek to
support our long-term interests, people to people relationships, built
over time and built on common bonds are key.
In these small nations, person-to-person communication is perhaps
more vital then when dealing with NATO or Japan or some other world
power.
The Peace Corps is a classic example of relationship building.
During the Trusteeship, we had more Peace Corps volunteers in
Micronesia than anywhere else in the world. However, that program was
ended, perhaps for all the wrong reasons. It is now time to reestablish
the Peace Corps in Micronesia and build grassroots relationships, as we
did in the 60s and 70s.
We have U.S. embassies in all the Micronesian capitals and capable
foreign service personnel and local nationals who solve low-level and
sometimes high-level issues that come between any two nations.
CINCPAC, in Hawaii, has been a key element in building effective
relations with the Micronesian States. On one hand it facilitates
Micronesian recruitment for the U.S. Armed Forces where they serve in
large numbers. It also has frequent meetings and exchanges in Honolulu
and in the FAS on security and defense issues.
Thank you for the opportunity to address these issues which should
be key factors when the Congress of the United States, and this
Committee, considers passage of the Compacts of Free Association which
have recently been submitted by the Administration. Expeditious action
on the Compacts by this Committee and others is essential, and will
send a positive message of continued U.S. interest and commitment to
democratic government in the FAS and the broader Pacific Islands.
______
Mrs. Radewagen. The Chair now recognizes Mr. Lum for 5
minutes.
STATEMENT OF THOMAS LUM, SPECIALIST IN ASIAN AFFAIRS,
CONGRESSIONAL RESEARCH SERVICE, WASHINGTON, DC
Dr. Lum. Task Force Chair Radewagen and co-Chair Sablan,
thank you for inviting the Congressional Research Service to
testify at today's hearing.
My name is Thomas Lum. I am a specialist in Asian affairs.
As requested, I will be discussing the Compacts of Free
Association and China's engagement with the Freely Associated
States.
Since the end of World War II, the United States has
maintained a dominant presence in the Micronesian subregion of
the Southwest Pacific, where the Freely Associated States, as
well as Guam and the Commonwealth of the Northern Mariana
Islands, are located. The United States signed bilateral
Compacts of Free Association with the Marshall Islands and
Micronesia in 1982, and with Palau in 1986. These were approved
by Congress in 1985 and 1986, respectively.
Through these Compacts, the Freely Associated States
receive economic assistance and security guarantees in exchange
for allowing the United States to operate military facilities
on their soil and to make decisions regarding mutual security.
Under the Compacts, the United States is obligated to defend
the Compact states against attack or threat of attack; the
United States has the prerogative to reject the strategic use
of or military access to the Compact states by third countries;
the United States may establish military facilities in the
Compact states; citizens of the Compact states have the right
to reside and work in the United States and its territories, as
roughly 100,000 lawful non-immigrants do; citizens of the
Compact states are eligible to volunteer for service in the
U.S. armed forces, where over 1,000 currently serve.
The U.S. Department of Defense operates the Ronald Reagan
Ballistic Missile Defense Test Site on Kwajalein Atoll in the
Marshall Islands. DoD is building a military radar system in
Palau. And in 2021, U.S. and Micronesian officials agreed to
establish a permanent U.S. military presence in Micronesia,
although the details of that plan are not yet clear.
Economic assistance pursuant to Title II of the Compacts is
set to expire at the end of Fiscal Year 2023 for the Marshall
Islands and Micronesia, and Fiscal Year 2024 for Palau. Compact
provisions related to defense, security, migration, and other
areas are to continue unchanged.
In May 2023, the United States signed final agreements with
Micronesia and Palau extending economic assistance for another
20 years, or through 2043. The United States and the Marshall
Islands signed a memorandum of understanding in January 2023,
but are still working on reaching a final agreement. Both
Houses of Congress would need to approve the agreements by
passing implementing legislation.
In the previous renewal in 2010, the United States and
Palau reached an accord on extending Compact assistance for the
period 2010 through 2024. That agreement was not approved and
fully funded by Congress until Fiscal Year 2018. The 2023
Compact agreements, including the Marshall Islands' MOU, would
provide approximately $6.5 billion in grants and trust fund
contributions and $634 million to continue U.S. postal services
over 20 years.
According to press reports, the next phase of Compact
assistance is to include greater support for climate change,
adaptation, health care, and education. Annual Compact
assistance for all three countries, including grants and trust
funds, would grow from roughly $200 million currently to $325
million.
Nuclear legacy issues stemming from U.S. nuclear weapons
testing over the Marshall Islands during the 1940s and 1950s
remain a sticking point in Compact negotiations with the
Marshall Islands. Marshall Islands leaders and peoples of the
four most affected atolls have claimed that U.S. compensation,
environmental cleanup, and restoration efforts, as well as
health programs, have been inadequate. The January 2023 U.S.-
Marshall Islands preliminary agreement on extending Compact
assistance reportedly includes a $700 million trust fund
intended for various purposes, including for addressing nuclear
legacy issues. Marshall Islanders also have expressed concerns
about possible leakage from Runit Dome, a radioactive waste
site on Enewetak Atoll.
The special Compact relationships between the United States
and the Freely Associated States and China's lack of diplomatic
relations with the Marshall Islands and Palau, which recognize
Taiwan, have limited China's engagement. The PRC government
imposes extra fees on Marshall Islands'-flagged vessels
entering Chinese ports, and in 2017 banned PRC tourists from
visiting Palau, which some analysts view as forms of PRC
pressure to switch diplomatic relations from Taiwan to China.
During the past two decades, China has become a major
provider of development assistance in the Pacific Islands
Region. Since 2009, China has provided Micronesia roughly $220
million in assistance, particularly for infrastructure
development. In 2022, the PRC government proposed a regional,
diplomatic, economic, and security pact with 10 Pacific island
countries. China shelved the proposal after some Pacific Island
countries, including strongly Micronesia, opposed it.
This concludes my brief remarks. Thank you for the
opportunity to testify, and I look forward to your questions.
[The prepared statement of Dr. Lum follows:]
Prepared Statement of Thomas Lum, Specialist in Asian Affairs,
Congressional Research Service
Indo-Pacific Task Force Chair Radewagen and Co-Chair Sablan, thank
you for inviting the Congressional Research Service to testify at
today's hearing. My name is Thomas Lum. I am a Specialist in Asian
Affairs. As requested, I will be discussing the Compacts of Free
Association and U.S. relations with the Freely Associated States.
History
The Republic of the Marshall Islands (RMI), Federated States of
Micronesia (FSM), and Republic of Palau, known collectively as the
Freely Associated States (FAS), cover a maritime area larger than the
continental United States, govern over 1,000 islands and atolls, and
have a combined population of approximately 200,000. The Freely
Associated States are sovereign, United Nations-member states that
through bilateral Compacts of Free Association with the United States
receive U.S. economic assistance and security guarantees and grant the
United States the prerogatives to operate military bases on their soil
and make decisions that affect U.S. and FAS security.
In 1947, the Marshall Islands, Micronesia, the Northern Mariana
Islands, and Palau, which had been under Japanese control during World
War II, became part of the U.S.-administered United Nations Trust
Territory of the Pacific Islands.\1\ The Northern Mariana Islands chose
commonwealth status in 1975.\2\ In 1978, the Marshall Islands,
Micronesia, and Palau rejected the option of U.S. territorial or
commonwealth status and instead chose the status of free association
with the United States.
---------------------------------------------------------------------------
\1\ U.S. military forces defeated the Japanese Imperial Army in the
Mariana Islands and Palau in 1944. In the Battle of Peleliu in northern
Palau, nearly 1,800 American soldiers were killed and 8,000 were
wounded.
\2\ Guam, occupied by the United States after the Spanish American
War ended in 1898, became an unincorporated territory in 1950.
---------------------------------------------------------------------------
The governments of the United States and the Marshall Islands and
Micronesia signed Compacts of Free Association in 1982. The RMI and FSM
Compacts were approved by plebiscites in the Marshall Islands and
Micronesia and by both houses of the U.S. Congress in 1985,\3\ becoming
effective in 1986. Also in 1986, the United States and Palau signed a
50-year Compact of Free Association, which was approved by the both
houses of Congress that year, but not ratified in Palau until 1993
(entering into force in 1994).\4\
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\3\ P.L. 99-239, Compact of Free Association Act of 1985. With the
exception of the economic provisions pursuant to Title II, the Compacts
with the Marshall Islands and Palau do not have explicit term limits.
\4\ P.L. 99-658, Palau Compact of Free Association Act and P.L.
101-219, Palau Compact of Free Association Implementation Act.
The U.S. government perceived the Compacts as helping to advance
economic development and self-sufficiency among the FAS and to support
the national security interests of the United States and the FAS in
light of Cold War geopolitical concerns related to the Soviet Union.
Although the goals of democratic self-government and mutual security
largely have been achieved, economic development and self-sufficiency
have remained elusive, particularly in the Marshall Islands and
Micronesia.\5\ In addition to economic assistance, key provisions of
the Compacts include the following:
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\5\ For further information on the Compacts of Free Association,
see CRS In Focus IF12194, The Compacts of Free Association and CRS
Report R46573, The Freely Associated States and Issues for Congress.
The United States is obligated to defend the FAS against
attack or threat of attack. The United States may block FAS
government policies that it deems inconsistent with its
duty to defend the FAS (also known as the ``defense
---------------------------------------------------------------------------
veto'').
The United States has the prerogative to reject the
strategic use of, or military access to, the FAS by third
countries (the ``right of strategic denial'').
The United States may establish military facilities in the
FAS. The U.S. military operates the Ronald Reagan Ballistic
Missile Defense Test Site (RTS) at U.S. Army Garrison-
Kwajalein Atoll in the RMI.
FAS citizens have the right to reside and work in the
United States and its territories as lawful non-
immigrants.\6\
---------------------------------------------------------------------------
\6\ FAS citizens are allowed to lawfully reside in the United
States, but they are not considered Lawful Permanent Residents or U.S.
citizens.
FAS citizens are eligible to volunteer for service in the
---------------------------------------------------------------------------
U.S. armed forces.
The FAS are eligible for some U.S. federal programs and
services, both on a mandatory and discretionary basis.
Figure 1. Pacific Islands and Southwest Pacific Subregions
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Source: CRS. Boundaries from U.S. Department of State.
Since the end of World War II, the United States has held a
dominant economic and security presence in the Micronesian subregion of
the Southwest Pacific (see Figure 1), where the FAS as well as Guam and
the Commonwealth of the Northern Mariana Islands are located. Located
roughly 2,500 miles southwest of Hawaii, the FAS play a role in
supporting the U.S. security presence in the Pacific Islands region at
a time of increasing strategic competition between the United States
and its allies, on one hand, and the People's Republic of China (PRC or
China), on the other. Some security and foreign policy experts refer to
the Micronesian subregion as forming the southern part of the so-called
second island chain in the Pacific, which has strategic importance for
both the United States and China. The first island chain includes
southern Japan, Taiwan, and the Philippines.
US-FAS Ties
Roughly 100,000 FAS citizens live in the United States, including
children under age 18 who were born in the United States and hold dual
citizenship. The FAS do not have their own militaries; over 1,000 FAS
citizens currently serve in the U.S. Armed Forces. On a per capita
basis, FAS citizens serve in the U.S. military at a higher rate than
many U.S. states' citizens.\7\ Eighteen FAS citizens lost their lives
serving in the U.S. military, mostly in the Iraq and Afghanistan
wars.\8\ The FAS have supported the United States in the United
Nations, where the RMI and FSM have among the highest rates of
agreement with U.S. positions or votes and consensus resolutions.\9\
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\7\ Department of State, ``U.S. Relations with the Federated States
of Micronesia,'' October 19, 2021.
\8\ Sandra Oudkirk, Deputy Assistant Secretary for Australia, New
Zealand, and Pacific Islands, Department of State, Statement before the
Senate Committee on Energy and Natural Resources, ``Hearing on U.S.
Interests in the Freely Associated States,'' July 23, 2019.
\9\ Department of State, ``Voting Practices in the United Nations
2021,'' March 31, 2022.
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The U.S. Department of Defense (DOD) operates the Ronald Reagan
Ballistic Missile Defense Test Site (RTS) at U.S. Army Garrison-
Kwajalein Atoll in the Marshall Islands. RTS supports missile and
missile defense testing, space launch, and space surveillance
activities. The amended Compact of 2003 extended U.S. base rights on
Kwajalein Atoll through 2066, with the U.S. option to continue the
arrangement for an additional 20 years.\10\ DOD is building a Tactical
Mobile-Over-the Horizon Radar (TACMOR) system in Palau. In July 2021,
U.S. and FSM officials agreed to cooperate on building up a more
frequent and permanent U.S. military presence in Micronesia.\11\
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\10\ Compact of Free Association Military Use and Operating Rights
Agreement between the United States of America and the Marshall
Islands, April 30, 2003, Article X.
\11\ The National Government of the Federated States of Micronesia,
``FSM-U.S. High-Level Defense & Security Talks Conclude; Actions Taken,
Commitments Made, Essential to FSM & Indo-Pacific Security,'' press
release, July 27, 2021.
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The Marshall Islands and Palau are among four Pacific Island
countries that have diplomatic relations with Taiwan but not the
PRC.\12\ In May 2022, China proposed a sweeping diplomatic, economic,
and security pact between the PRC and ten Pacific Island countries with
which it has diplomatic relations.\13\ Some Pacific Island countries,
including Micronesia, opposed the agreement, causing China to shelve
the proposal.
---------------------------------------------------------------------------
\12\ Of 14 countries worldwide that recognize Taiwan
diplomatically, four are in the Pacific (RMI, Nauru, Palau, and
Tuvalu). China does not recognize countries that have diplomatic
relations with Taiwan, which it considers to be a part of the PRC.
\13\ Laura Zhou, ``China Responds to Pacific Island Rejection with
Paper on `Mutual Respect and Common Development','' South China Morning
Post, May 31, 2022; ``China Wants 10 Small Pacific Nations to Sign on
to `Game-Changing' Security Agreement,'' Associated Press, May 25,
2022.
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Renewing Economic Provisions of the Compacts
Economic assistance pursuant to Title II of the Compacts of Free
Association is set to expire at the end of Fiscal Year (FY) 2023 for
the Marshall Islands and Micronesia, and at the end of FY2024 for
Palau. Compact provisions related to defense, security, migration, and
other areas are to continue unchanged. The Department of the Interior
(DOI) funds and administers this assistance, also referred to as grant
assistance, through mandatory or permanent appropriations.\14\ On May
22 and May 23, 2023, the United States signed agreements with Palau and
Micronesia, respectively, on extending the economic assistance
provisions of the Compacts of Free Association for another 20
years.\15\ The President is to submit the agreements as draft
legislation to both houses of Congress, and Congress is to approve the
agreements through passing implementing legislation. A final U.S.
agreement with the Marshall Islands on extending Compact economic
assistance has not yet been reached.\16\
---------------------------------------------------------------------------
\14\ See Department of the Interior, ``Compact Grants Assistance,''
at https://www.doi.gov/oia/compact-grant-assistance.
\15\ Department of State, ``Secretary Blinken Witnesses the Signing
of the U.S.-Palau 2023 Agreement Following the Compact of Free
Association Section 432 Review,'' media note, May 22, 2023; Department
of State, ``Signing of the U.S.-FSM Compact of Free Association-Related
Agreements,'' media note, May 23, 2023.
\16\ In January and February 2023, the United States signed
memoranda of understanding with all three Compact countries on the
basic levels and types of Compact assistance for the next 20 years.
---------------------------------------------------------------------------
Compact economic assistance funded through the Department of the
Interior amounts to roughly 75% of all U.S. assistance to the Pacific
Islands region.\17\ Outside of DOI Compact economic assistance, the
Department of State recently has pledged new aid funding and
programming for the Pacific Islands region overall. In 2019, the State
Department launched a new Pacific Islands regional foreign assistance
program. In 2019 and 2020, the Trump Administration committed a total
of $300 million in new funding as part of its ``Pacific Pledge.'' \18\
In September 2022, the Biden Administration announced $210 million in
``additional expanded programs'' and $60 million annually (for a
duration of 10 years) to support sustainable fisheries in the Pacific
Islands region.\19\
---------------------------------------------------------------------------
\17\ According to data from USAID (ForeignAssistance.gov), Fiscal
Years 2019-2022 (obligated funds in current dollars).
\18\ State Department, ``U.S. Engagement in the Pacific Islands:
2020 Pacific Pledge,'' fact sheet, October 1, 2020, at https://2017-
2021.state.gov/u-s-engagement-in-the-pacific-islands-2020-pacific-
pledge/index.html; State Department, ``U.S. Engagement in the Pacific
Islands: U.N. General Assembly Update,'' fact sheet, October 3, 2019,
at https://2017-2021.state.gov/u-s-engagement-in-the-pacific-islands-
un-general-assembly-update/index.html.
\19\ The White House, ``Fact Sheet: Roadmap for a 21st Century
U.S.-Pacific Island Partnership,'' September 29, 2022, at https://
www.whitehouse.gov/briefing-room/statements-releases/2022/09/29/fact-
sheet-roadmap-for-a-21st-century-u-s-pacific-island-partnership/;
Department of State, FY2024 Congressional Budget Justification, p. 199.
---------------------------------------------------------------------------
Pursuant to the Compacts, the United States provided DOI grant
assistance worth approximately $661 million to the Marshall Islands and
$1.54 billion to Micronesia during the first Compact economic
assistance term (1987-2003). Following the completion of negotiations
in 2003,\20\ Congress approved agreements amending the Compacts and
extending assistance for another 20 years.\21\ Two new features of the
assistance were trust funds established with the aim of providing
sustainable sources of revenue after 2023 and oversight committees with
members from the U.S. and FAS governments. During the second economic
assistance term (2004-2023), U.S. grant assistance and trust fund
contributions to the Marshall Islands totaled $722 million and $276
million, respectively. Micronesia received $1.6 billion in grant
assistance and $517 million in trust fund contributions during the same
period.\22\ According to the Government Accountability Office, total
Compact-related assistance during the second term totaled $3.6 billion
for the two countries, targeting six sectors: education, health, the
environment, public sector capacity building, private sector
development, and infrastructure.
---------------------------------------------------------------------------
\20\ The economic provisions of the Compacts with the Marshall
Island and Micronesia expired in 2001. Economic assistance was extended
by 2 years (2002-2003) while bilateral negotiations to amend the
Compacts and continue economic assistance took place.
\21\ The Compact of Free Association Amendments Act of 2003 (P.L.
108-188).
\22\ These amounts do not include nuclear test-related funding and
Kwajalein payments to the Marshall Islands, federal program assistance,
Compact Impact funding, and other assistance using discretionary funds.
---------------------------------------------------------------------------
During Palau's first Compact economic assistance term (1995-2009),
Compact assistance included grants, road construction, and the
establishment of a trust fund worth $574 million.\23\ In 2010, the
United States and Palau concluded the U.S.-Palau Compact Review
Agreement, to extend economic assistance for another 15 years (2010-
2024), worth $229 million.\24\ Compact assistance under the Review
Agreement includes support for education, health, and the
administration of justice; infrastructure projects and maintenance;
debt reduction; and trust fund contributions. The 2010 agreement was
not fully funded by Congress until FY2018, largely due to budgetary
constraints, raising concerns among the Compact states about U.S.
commitment to the FAS.\25\
---------------------------------------------------------------------------
\23\ In addition, Palau received Compact federal services worth $25
million and discretionary federal program assistance amounting to $267
million. Statement of David Gootnick, Director, International Affairs
and Trade, Government Accountability Office, ``Compact of Free
Association: Proposed U.S. Assistance to Palau for Fiscal Years 2016 to
2024,'' Testimony before the House Subcommittee on Indian, Insular, and
Alaska Native Affairs, Committee on Natural Resources, July 6, 2016.
\24\ Department of the Interior, ``Budget Justifications and
Performance Information, Fiscal Year 2024, Office of Insular Affairs;''
Agreement between the Government of the United States of America and
the Government of the Republic of Palau Following the Compact of Free
Association Section 432 Review, September 3, 2010 at https://
www.state.gov/18-919-2/.
\25\ Elke Larsen, ``Prioritizing Palau: Why the Compact Budget
Matters,'' Center for Strategic and International Studies, October 10,
2013; Comments by Senator Lisa Murkowski, Chair, Senate Energy and
Natural Resources, Hearing on U.S. Interests in the Freely Associated
States, July 23, 2019. The National Defense Authorization Act for
FY2018 (P.L. 115-91, Section 1259C) approved the U.S.-Palau Compact
Review Agreement and authorized remaining funding under the agreement.
The Consolidated Appropriations Act, FY2018 (P.L. 115-141, Division G,
Title I, Section 114) appropriated outstanding economic assistance
pursuant to the agreement.
---------------------------------------------------------------------------
The final Palau and Micronesia Compact agreements and the
preliminary agreement with the Marshall Islands provide for a total of
approximately $7.1 billion in Compact economic assistance for the 2024-
2043 period, including $6.5 billion in grants and trust fund
contributions and $634 million to continue U.S. Postal Service services
in the FAS.\26\ According to press reports, the next phase of Compact
assistance is to include greater support for climate change adaptation,
health care, and education. The preliminary agreement with the Marshall
Islands reportedly includes a $700 million trust fund intended for
various purposes, including for addressing nuclear legacy issues (see
below) and for Kwajalein atoll.\27\ Under the pending agreements, total
annual Compact assistance for the FAS would grow from roughly $200
million annually to $325 million (not including Postal Service funding
during 2024-2043).
---------------------------------------------------------------------------
\26\ See Department of State, FY2024 Congressional Budget
Justification, p. 100.
\27\ Anita Hofschneider, ``Marshall Islands Could Receive Billions
Under Renegotiated Treaty,'' Civilbeat.org, January 22, 2023; Matthew
Lee, ``US Nears New Cooperation Deals with Two Pacific Island
Nations,'' Saipan Tribune, January 16, 2023.
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China's Relations with the FAS
Although the PRC's influence in the Pacific Islands region is
growing, its engagement among the FAS compared to its relations in the
rest of the region has been limited, due to the U.S. political,
economic, and security presence in the Compact states and to the PRC's
lack of diplomatic relations with the Marshall Islands and Palau.
China's engagement is greater in Micronesia, with which it has
diplomatic relations, as well as a ``comprehensive strategic
partnership.'' \28\ China has provided roughly $220 million in
assistance to Micronesia, particularly infrastructure development,
since 2009, according to the Lowy Institute.\29\ Despite close ties, in
March 2023, outgoing FSM President David Panuelo wrote a letter to FSM
national and state leaders detailing PRC efforts at economic coercion,
bribery, espionage, surveillance, and harassment in Micronesia,
including PRC diplomats applying pressure on him personally.\30\
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\28\ Cao Desheng, ``President Hails Ties with Micronesia in
Greetings,'' China Daily, May 21, 2019.
\29\ Data compiled by the Lowy Institute, an independent,
nonpartisan international policy think tank located in Sydney,
Australia. The Pacific Aid map and data are accessible at PACIFIC AID
MAP / MAP (lowyinstitute.org). Data for 2021 and 2022 are incomplete.
\30\ The letter, dated March 9, 2023, is accessible at https://
www.documentcloud.org/documents/22037013-letter-from-h-e-david-w-
panuelo-to-pacific-island-leaders-may-20-2022-signed.
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China is one of the principal trading partners of the Marshall
Islands, based largely on the RMI's import of Chinese transport boats.
The PRC government imposes extra fees on Marshall Islands-flagged
vessels entering PRC ports, which some analysts view as a form of PRC
pressure on the RMI to switch diplomatic relations from Taiwan to the
PRC.\31\ In late 2017, Beijing banned PRC visitors to Palau, which had
grown in number to account for over half of all foreign tourists in
Palau. Some observers point to this ban as evidence that China was
attempting to pressure Palau into diplomatically recognizing the PRC
rather than Taiwan.\32\
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\31\ United States Institute of Peace, ``China's Influence on the
Freely Associated States of the Northern Pacific,'' 2022.
\32\ Stephen Dziedzic, ``Beijing Intensifies Lobbying of Pacific
Nations to Recognize Taiwan as Part of One China,'' Australian
Broadcasting Corporation, February 13, 2019; Lauren McMah, ``Island
Paradise in Peril After Incurring Wrath of China,'' News.com.au, August
21, 2018.
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Nuclear Legacy Issues
Nuclear legacy issues remain a sticking point in U.S.-Marshall
Islands negotiations to renew Compact economic provisions. From 1946 to
1958, the United States conducted 67 atmospheric atomic and
thermonuclear weapons tests over the Marshall Islands atolls of Bikini
and Enewetak.\33\ In 1954, ``Castle Bravo,'' the second test of a
hydrogen bomb, was detonated over Bikini atoll. The U.S. military
evacuated 312 Marshallese from Bikini and Enewetak prior to the
test.\34\ Reported to be 1,000 times more powerful than the atomic
weapon that was dropped on Hiroshima, Japan in 1945, Bravo resulted in
radioactive fallout upon the populated atolls of Rongelap and Utrik.
Reportedly, 253 residents of these atolls were evacuated within days of
the blast, although not all before radioactive ash had begun
falling.\35\
---------------------------------------------------------------------------
\33\ Embassy of the United States in the Marshall Islands, ``The
Legacy of U.S. Nuclear Testing and Radiation Exposure in the Marshall
Islands,'' at https://mh.usembassy.gov/the-legacy-of-u-s-nuclear-
testing-and-radiation-exposure-in-the-marshall-islands/.
\34\ Bev Keever, ``Enewetak Atoll, 50 Years Ago This Week,''
Honolulu Weekly, October 30, 2002.
\35\ The U.S. government states that the U.S. military evacuated
residents of Rongelap and Utrik within 52 hours of Castle Bravo, while
other reports state that not all residents were evacuated until 48-72
hours after the explosion. Embassy of the United States in the Marshall
Islands, ``The Legacy of U.S. Nuclear Testing and Radiation Exposure in
the Marshall Islands''; Dan Zak, ``A Ground Zero Forgotten,''
Washington Post, November 27, 2015; Giff Johnson, ``U.S. Seriously
Underestimated Marshall Islands Fallout Doses, Risk,'' Marianas
Variety, August 9, 2020.
---------------------------------------------------------------------------
The nuclear testing resulted in hardships and health problems for
many Marshall Islanders of the four most affected RMI atolls of Bikini,
Enewetak, Rongelap, and Utrik. The people of Rongelap, in particular,
have experienced elevated level of cancers, thyroid disorders, and
birth deformities.\36\ Following U.S. government radiological cleanup
efforts, the people of Utrik returned in 1955 and Enewetak people
returned in 1980. The people of Rongelap returned in 1957 and were re-
evacuated in 1985 after new studies revealed unsafe levels of
radiation. The U.S. government declared Bikini safe for habitation
beginning in 1968, although returnees were re-evacuated in 1978 after
``alarming'' radiation levels were detected in their bodies, and the
atoll has not been permanently resettled.\37\
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\36\ Susanne Rust ``How the U.S. Betrayed the Marshall Islands,
Kindling the Next Nuclear Disaster,'' Los Angeles Times, November 10,
2019.
\37\ Jon Letman, ``Nuclear Justice for the Marshall Islands''; RMI
Embassy, Nuclear Testing on the Marshall Islands: A Chronology of
Events.
---------------------------------------------------------------------------
Runit Dome
Located on Enewetak atoll, Runit Dome is a concrete roof that U.S.
military personnel built over a nuclear crater, which is filled with
over 100,000 cubic yards of radioactive soil from U.S. nuclear
testing.\38\ Due to rising sea levels, water reportedly has entered the
dome, which has led some local observers to fear that radioactive water
could seep out.\39\ In June 2020, the Department of Energy (DOE)
released a report on Runit Dome pursuant to the National Defense
Authorization Act, FY2020 (P.L. 116-92, Sec. 364). The report concluded
that the dome itself was not in immediate danger of collapse or failure
and that there was no data to suggest that there was any flow of
contaminated groundwater from beneath the structure that had a
``measurable adverse effect on the surrounding environment'' or that
would likely cause any adverse effect for up to 20 years.\40\ The
National Defense Authorization Act, FY2022 (P.L. 117-81, Sec. 3140)
mandated a study on the impacts of climate change on Runit Dome.
---------------------------------------------------------------------------
\38\ Susanne Rust ``How the U.S. Betrayed the Marshall Islands,
Kindling the Next Nuclear Disaster,'' Los Angeles Times, November 10,
2019.
\39\ Kyle Mizokami, ``Congress Demands Investigation into the
U.S.'s Nuclear Coffin,'' Popular Mechanics, December 27, 2019.
\40\ Department of Energy, ``Report on the Status of Runit Dome in
the Marshall Islands: Report to Congress,'' June 2020, at https://
www.energy.gov/sites/prod/files/2020/06/f76/DOE-Runit-Dome-Report-to-
Congress.pdf.
---------------------------------------------------------------------------
Nuclear Compensation
The RMI government and peoples of the four most affected atolls
have long argued that U.S. compensation and assistance to Marshall
Islanders for personal injuries or adverse effects on health, the loss
of land, and property damages has been inadequate. Under the Compact of
Free Association, Section 177, the United States ``accept[ed]
responsibility for compensation owing to the citizens of the Marshall
Islands . . . for loss or damage to property and person . . . resulting
from the nuclear testing program . . .'' \41\ The Compact established a
$150 million Nuclear Claims Fund to provide compensation for nuclear
contamination-related injuries and damages, and a Nuclear Claims
Tribunal (NCT) to adjudicate claims and grant awards from the Fund. The
Fund was intended to generate, through returns on investments, a
perpetual source of revenue to be distributed among the 177 Health
Program, trust funds for the four most affected atolls, and the NCT.
Section 177 constituted a ``full and final settlement'' of related
claims, thereby ending nuclear compensation lawsuits by Marshall
Islanders against the U.S. government that were pending in U.S. courts.
\42\ In 2004, the U.S. government released a report evaluating a
Marshall Islands petition for greater compensation pursuant to Article
IX of the 177 Agreement (the Changed Circumstances Clause),\43\
concluding that there was no legal basis for considering additional
compensation payments.\44\
---------------------------------------------------------------------------
\41\ See P.L. 99-239, Title I, Article VII, Sec. 177 and the
Agreement between the Government of the United States and the
Government of the Marshall Islands for the Implementation of Section
177, at Section 177 Agreement (doi.gov).
\42\ Ibid.
\43\ Article IX states: ``If loss or damage to property and person
of the citizens of the Marshall Islands, resulting from the Nuclear
Testing Program, arises or is discovered after the effective date of
this Agreement, and such injuries were not and could not reasonably
have been identified as of the effective date of this Agreement, and if
such injuries render the provisions of this Agreement manifestly
inadequate, the Government of the Marshall Islands may request that the
Government of the United States provide for such injuries by submitting
such a request to the Congress of the United States for its
consideration.
\44\ U.S. Department of State, Report Evaluating the Request of the
Government of the Republic of the Marshall Islands Presented to the
Congress of the United States of America, November 2004.
---------------------------------------------------------------------------
According to U.S. government sources, between 1958 and 2004, the
United States provided $531 million to the Marshall Islands for nuclear
test damages, environmental cleanup and restoration, resettlement, and
health and medical programs; \45\ this compensation grew to roughly
$600 million by 2019.\46\ The U.S. government has provided compensation
pursuant to the Compact of Free Association, through congressional ex
gratia payments,\47\ and through health sector grants during the second
Compact assistance term (2004-2023).\48\ According to the Marshall
Islands government, the depletion of the Nuclear Claims Fund (in 2009)
left $23 million in personal injury awards and $2.2 billion in property
damages awards unpaid.\49\
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\45\ Department of State, ``U.S. Medical and Environmental
Assistance to the Marshall Islands,'' fact sheet, January 4, 2005, at
U.S. Medical and Environmental Assistance to the Marshall Islands
(state.gov); Department of State, Report Evaluating the Request of the
Government of the Republic of the Marshall Islands Presented to the
Congress of the United States of America.
\46\ Susanne Rust, ``How the U.S. Betrayed the Marshall Islands,
Kindling the Next Nuclear Disaster''; Embassy of the United States,
Majuro, Marshall Islands, ``The Legacy of U.S. Nuclear Testing and
Radiation Exposure in the Marshall Islands.''
\47\ Congressional ex gratia payments are not compelled by legal
right or formal agreement.
\48\ For information about DOE programs for medical surveillance
and care, environmental monitoring and characterization, and dose
assessment for the peoples of the nuclear affected atolls, see
Department of Energy, International Health Studies and Activities, at
https://www.energy.gov/ehss/international-health-studies-and-
activities.
\49\ Marshall Islands National Nuclear Commission, ``Nuclear
Justice for the Marshall Islands--A Strategy for Coordinated Action,
FY2020-FY2023,'' 2019, at https://rmi-data.sprep.org/system/files/
RMI%20NNC%20Strategy%202019.pdf.
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Conclusion
To conclude, under the Compacts of Free Association, the Republic
of the Marshall Islands, Federated States of Micronesia, and Republic
of Palau serve as key diplomatic and security partners of the United
States in the Pacific. In an era of growing strategic competition
between the United States and China in the Pacific Islands region, the
U.S. government has pledged greater assistance and attention to Pacific
Island countries and the Freely Associated States. Renewing the
economic provisions of the Compacts reflect U.S. commitment to the
region and aim to respond to ongoing issues in U.S.-FAS relations.
______
Questions Submitted for the Record to Dr. Thomas Lum, Specialist in
Asian Affairs, Congressional Research Service
Questions Submitted by Representative Westerman
Question 1. The U.S. economic assistance to the Republic of Palau
under the current compact agreement is unique in that assistance was
extended through a U.S.-Palau Compact Review Agreement (CRA) in 2010,
rather than through an amended Compact of Free Association (COFA). When
looking at the CRA, we see provisions refer to the original COFA with
Palau. This has made the Palau's compact agreements more complex than
the compact agreements with the other [Freely Associated States (FAS)]
countries, as Palau's compact provisions are laid out across multiple
documents. Meanwhile, the 2003 agreements with the Federated States of
Micronesia and the Republic of the Marshall Islands agreements do not
require such reference as economic assistance was extended through
amended COFAs with each country.
Do you have any recommendations on how the U.S. and Palau could
resolve this issue?
Answer. The unique process by which the U.S. economic or grant
assistance provisions (Title Two) of the COFA with Palau are extended
does not appear to have delayed past or recent negotiations of CRAs
with Palau, although the congressional budget process delayed the
allocation of funds for Palau following the 2010 CRA. The U.S.-Palau
Compact of Free Association (Palau Compact of Free Association Act,
P.L. 99-658, Section 432) states in part:
Upon the fifteenth and thirtieth and fortieth anniversaries of
the effective date of this Compact, the Government of the
United States and the Government of Palau shall formally review
the terms of this Compact and its related agreements and shall
consider the overall nature and development of their
relationship. In these formal reviews, the governments shall
consider the operating requirements of the Government of Palau
and its progress in meeting the development objectives set
forth in the plan referred to in Section 231(a). The
governments commit themselves to take specific measures in
relation to the findings of conclusions resulting from the
review.
Section 231(a) of the Palau Compact of Free Association Act states:
The annual expenditure by the Government of Palau of the grant
amounts specified in Article I of this Title shall be in
accordance with an official national development plan
promulgated by the Government of Palau and concurred in by the
Government of the United States prior to the effective date of
this Compact. This plan may be amended from time to time by the
Government of Palau.
A CRS review of news reports, expert analysis, congressional
testimony, and U.S. government statements does not find evidence to
suggest the review process or any related conditions pursuant to the
Palau Compact hindered negotiations to renew economic assistance
provisions of the Compact prior to the 2010 CRA. Compared to the other
two Compact states, the Marshall Islands and Micronesia, Palau had
``proved more responsible in how it handle[d] its funding.'' \1\
---------------------------------------------------------------------------
\1\ Elke Larsen, ``Prioritizing Palau: Why the Compact Budget
Matters,'' Center for Strategic and International Studies,'' October
10, 2013.
---------------------------------------------------------------------------
The Government Accountability Office (GAO) reported in 2008:
Despite limited capacity to address persistent internal control
weaknesses, Palau made progress in providing financial
accountability and met most of the compact's and related
agreements' accountability requirements; however, [the Office
of Insular Affairs] provided limited monitoring of Palau's
accountability for compact assistance.\2\
---------------------------------------------------------------------------
\2\ Government Accountability Office, Compact of Free Association:
Palau's Use of and Accountability for U.S. Assistance and Prospects for
Self-Sufficiency,'' June 2008, p. 4.
The GAO report suggested, furthermore, that the review process was
not rigorous. The report stated that Palau provided annual reports to
the U.S. government but that there was ``no documentation regarding . .
. whether the U.S. government agreed or disagreed that Palau used
compact funds as set forth in its economic development plan.'' Economic
consultations were ``informal'' and ``did not provide any
documentation.'' \3\ Some analysts call for greater U.S. oversight of
Compact assistance, particularly in the Marshall Islands and
Micronesia, which might suggest a need to strengthen Palau's oversight
mechanisms and apply them to the other COFA states.\4\
---------------------------------------------------------------------------
\3\ Ibid., p. 31.
\4\ Emil Friberg, Testimony before the House Natural Resources
Committee on Indian and Insular Affairs--``Preserving U.S. Interests in
the Indo-Pacific: Examining How U.S. Engagement Counters Chinese
Influence in the Region,'' May 16, 2023; Michael Walsh, ``Congress
Should Strengthen Oversight on Pacific Islands Affairs,'' The Hill,
March 28, 2023; David Gootnick, Government Accountability Office,
Testimony before the Committee on Energy and Natural Resources, U.S.
Senate, April 5, 2016.
---------------------------------------------------------------------------
To the degree that Palau may have fallen short on benchmarks
related to its national development plan, the U.S. government offered
additional, targeted assistance to help Palau meet its economic goals
during the second Compact assistance period (2010-2024). According to
2011 testimony by Anthony Babauta, then-Assistant Secretary of the
Interior for Insular Affairs, the Compact Section 432 review focused in
part on four areas for further Compact assistance: (1) the Compact
trust fund; (2) implementation of fiscal reforms; (3) foreign
investment and private sector growth; and (4) the continuation of U.S.
economic assistance.\5\
---------------------------------------------------------------------------
\5\ Hearing before the Committee on Energy and Natural Resources,
U.S. Senate, ``To Review S. 343, a Bill to Amend Title 1 of P.L. 99-658
Regarding the Compact of Free Association between the Government of the
United States of America and the Government of Palau . . .,'' June 16,
2011.
---------------------------------------------------------------------------
In 2010, the United States and Palau concluded the U.S.-Palau
Compact Review Agreement, to extend economic assistance for another 15
years, worth $229 million.\6\ The 2010 agreement was not fully funded
by Congress until FY2018, largely due to budgetary constraints. The
Budget Control Act of 2011 (P.L. 112-25) required new mandatory
spending to be offset by spending cuts elsewhere; negotiations over
this process delayed funding for Palau.\7\
---------------------------------------------------------------------------
\6\ Department of the Interior, ``Budget Justifications and
Performance Information, Fiscal Year 2024, Office of Insular Affairs;''
Agreement between the Government of the United States of America and
the Government of the Republic of Palau Following the Compact of Free
Association Section 432 Review, September 3, 2010 at https://
www.state.gov/18-919-2/.
\7\ Elke Larsen, ``Prioritizing Palau: Why the Compact Budget
Matters,'' Center for Strategic and International Studies, October 10,
2013; David Walter, ``Sequestration in Paradise,'' Wall Street Journal,
February 28, 2013.
---------------------------------------------------------------------------
As talks to renew economic provisions of the Compact with Palau for
the 2025-2044 period progressed in 2022 and 2023, the U.S. and Palau
governments discussed Palau's economic development, but any issues
related to Palau's meeting Compact objectives or to its national
development plan did not appear to impede negotiations or thwart
increased funding levels.\8\ The Palau Economic Advisory Group (EAG)
was formed in 2022 pursuant to the 2010 CRA.\9\ Its first report noted,
among other observations, that the financial situation of the economy
and government of Palau was ``dire,'' due in part to the collapse of
tourism. The report did not place economic conditions on Palau for
renewing the Compact, but rather made policy recommendations to carry
out during and after completion of negotiations.\10\ During the 2022-
2023 U.S.-Palau Compact negotiations, Palau President Surangel Whipps
negotiated an increase in total grant assistance to $889 million, more
than twice the amount the U.S. government had proposed at the start of
bilateral discussions in 2020. President Whipps reportedly had found
the initial offer ``unacceptable.'' \11\
---------------------------------------------------------------------------
\8\ Heritage Foundation, ``Pacific Islands Roundtable,'' April 26,
2023.
\9\ The EAG is composed of five members. The U.S. and Palau
governments each appoint two members, and the fifth is selected by the
United States and nominated by Palau.
\10\ First Annual Report of the Palau Economic Advisory Group,
April 2023. See also Department of State, ``Completion of the Palau
Bilateral Economic Consultation Meetings,'' media note, June 23, 2023
and Department of State, ``Secretary Blinken Witnesses the Signing of
the U.S.-Palau 2023 Agreement Following the Compact of Free Association
Section 432 Review,'' media note, May 22, 2023.
\11\ Leilani Reklai, ``Palau and US Formally Sign Compact Review
Agreement,'' Island Times, May 23, 2023; Ongerung Kambes Kesolei
,``Looking at Palau's Approach to the Compact Negotiation,'' Pacific
Island Times, February 7, 2023; Leilani Reklai, ``US-Palau Compact
Review MOU Promises Double Financial Assistance, Island Times, January
13, 2023.
Question 2. In 2003, the U.S. State Department changed the security
and defense provisions of the RMI and the FSM compact agreements. These
include creating linkages between access to COFA trust funds and
---------------------------------------------------------------------------
compliance with U.S. strategic denial rights.
Do you think the State Department's linkage of economic assistance
and defense and security rights have created uncertainty in the FAS
about the permanence of COFA and that this gave the PRC an opening to
exert influence in the RMI and the FSM?
Answer. Several factors suggest the Republic of the Marshall
Islands (RMI) and the Federated States of Micronesia (FSM) prefer to
work with the United States on issues related to the Compacts and are
wary of the influence of the People's Republic of China (PRC or China).
The Compact of Free Association Amendments Act of 1985 (P.L. 108-188,
Section 354), and the Trust Fund Agreements between the United States
and the RMI and FSM contain provisions that allow the United States to
withdraw its contributions from the Compact trust funds if the RMI or
FSM government takes any action that the U.S. government determines to
be incompatible with the U.S. responsibility for security and defense
matters related to the Compact states.\12\
---------------------------------------------------------------------------
\12\ See, for example, ``Agreement Between the Government of the
United States of America and the Government of the Federated States of
Micronesia Implementing Section 216 and Section 217 of the Compact, as
Amended, Regarding a Trust Fund,'' at Trust Fund Agreement--Joint
Committee on Compact Review and Planning (JCRP) (gov.fm).
---------------------------------------------------------------------------
The RMI and FSM governments do not appear to have explicitly
challenged these Compact provisions, have supported their security and
defense relationships with the United States, and, according to at
least one report, have not seriously considered withdrawing from the
Compacts.\13\ China's growing influence in the region, rather than
providing an incentive to embrace China, reportedly has given the RMI
and FSM more leverage in negotiations with the United States to extend
Compact economic assistance. And while some RMI and FSM citizens have
expressed distrust of U.S. military engagement, news reports suggest
that local sentiment generally has favored the United States over
China.\14\
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\13\ ``America's Pacific Island Allies: The Freely Associated
States and Chinese Influence,'' RAND, 2019.
\14\ Peter McKenzie, ``Marshall Islands, Feeling Neglected by the
U.S., Enjoys New Leverage,'' Washington Post, January 27, 2023; Ashley
Westerman, ``The US is Building a Military Base in the Middle of the
Pacific Ocean. Micronesian Residents Have Questions,'' The World,
August 24, 2021.
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Although the PRC's influence in the Pacific Islands region is
growing, its engagement among the FAS compared to its relations in the
rest of the region has been limited, due to the U.S. political,
economic, and security presence among the COFA states and to the PRC's
lack of diplomatic relations with the Marshall Islands and Palau.\15\
China's engagement is greater in Micronesia, with which it has
diplomatic relations, as well as a ``comprehensive strategic
partnership.'' \16\ Nonetheless, in May 2022, when China proposed a
sweeping diplomatic, economic, and security pact between the PRC and
ten Pacific Island countries (PICs) with which it has diplomatic
relations, then FSM President David Panuelo and some other PICs opposed
the agreement, causing China to shelve it.\17\
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\15\ Of 14 countries worldwide that recognize Taiwan
diplomatically, four are in the Pacific (Marshall Islands, Nauru,
Palau, and Tuvalu). China does not recognize countries that have
diplomatic relations with Taiwan, which it considers to be a part of
the PRC. The Marshall Islands and Palau governments have pledged
continued commitment to Taiwan. ``Marshall Islands says `Strongly
Committed' to Taiwan Ties,'' Reuters, March 22, 2022; ``Palau Says
Committed to Supporting Taiwan Despite ``Mounting Aggressions',''
Reuters, October 6, 2022.
\16\ Cao Desheng, ``President Hails Ties with Micronesia in
Greetings,'' China Daily, May 21, 2019.
\17\ Kirsty Needham, ``China Seeks Pacific Islands Policing,
Security Cooperation--Document,'' Reuters, May 25, 2022.
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On May 22 and May 23, 2023, the United States signed agreements
with Palau and Micronesia, respectively, on extending the economic
assistance provisions of the Compacts of Free Association for another
20 years.\18\ A final U.S. agreement with the Marshall Islands has not
yet been reached.\19\ Marshall Islands resistance to signing an
agreement with the United States stems largely from dissatisfaction
with the way the U.S. government has provided compensation for the
effects of past nuclear testing over the country.\20\ According to U.S.
government sources, between 1958 and 2019, the United States provided
$600 million to the Marshall Islands for nuclear test damages,
environmental cleanup and restoration, resettlement, and health and
medical programs.\21\ The RMI government and local communities long
have sought greater compensation from the U.S. government, but so far
have not turned to China for assistance related to U.S. nuclear legacy
issues.
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\18\ Department of State, ``Secretary Blinken Witnesses the Signing
of the U.S.-Palau 2023 Agreement Following the Compact of Free
Association Section 432 Review,'' media note, May 22, 2023; Department
of State, ``Signing of the U.S.-FSM Compact of Free Association-Related
Agreements,'' media note, May 23, 2023.
\19\ In January and February 2023, the United States signed
memoranda of understanding with all three Compact countries on the
basic levels and types of Compact assistance for the next 20 years.
\20\ ``Marshall Islands Compact Held Up by Nuclear Legacy,'' RNZ,
June 27, 2023.
\21\ Susanne Rust, ``How the U.S. Betrayed the Marshall Islands,
Kindling the Next Nuclear Disaster,'' Los Angeles Times, November 10,
2019; Embassy of the United States, Majuro, Marshall Islands, ``The
Legacy of U.S. Nuclear Testing and Radiation Exposure in the Marshall
Islands.''
While the RMI and FSM governments remain committed to the Compacts,
according to some observers, one area of possible concern is political
fragmentation, particularly in Micronesia. Some residents of two FSM
states, Chuuk and Yap, have supported separating from the federation,
citing economic and other reasons. Political fragmentation could
possibly lead to new political entities outside of the Compacts'
authorities, stronger local relations with China, and/or greater
vulnerability to PRC influence, including corruption.\22\
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\22\ United States Institute of Peace, ``China's Influence on the
Freely Associated States of the Northern Pacific,'' September 2022;
Jonathan Barrett, ``Chuuk Independence Vote Postponed as China-U.S.
Pacific Contest Builds,'' Reuters, February 26, 2020; ``Falan: Yap Is
Increasingly Finding Itself at the Mercy of China,'' Pacific Island
Times, July 17, 2022; China Meets Its Limits in Micronesia, East Asia
Forum, April 8, 2020.
Question 3. In the March 17, 2023, CRS report, ``The Compacts of
Free Association,'' it is stated that ``More than 94,000 FAS citizens
live in the United States, including children under the age of 18 who
were born in the United States and hold dual citizenship.'' Given the
importance of clarifying issues unique to the Compacts and related
statutes, we would note that on May 5, 2023, the Department of the
Interior (DOI), Office of Insular and International Affairs (OIA),
issued a press release also reporting the FAS resident population in
U.S. at 94,000.
In this respect, the DOI/OIA press release cited GAO Report 20-491,
dated June 15, 2020, as the source for OIA's assertion that ``. . .
more than 94,000 Compact Migrants . . .'' from the FSM, the RMI, and
Palau ``. . . live and work in . . .'' the U.S. and its territories.
The OIA statement added that among the 94,000 ``Compact Migrants'' an
``. . . estimated 43% are U.S. citizens.''
The estimate of 43% U.S. citizenship rate among what GAO and OIA
refer to as ``Compact Migrants'' is confirmed at Appendix VI, p. 67 of
the GAO report. The GAO report cited by OIA also states that, ``From
2013 to 2018 an estimated 50 percent of compact migrants lived on the
U.S. mainland.''
While the U.S. does not treat acquisition of a citizenship of other
nations under the laws thereof as relinquishment or grounds for loss of
U.S. nationality, in general the U.S. does not create dual citizenship
by operation of U.S. law. The suggestion that by conflation of COFA
Section 141 non-immigrant visa waiver residence and the Section 104(e)
definition of qualified nonimmigrant combine to recognize or establish
a form of dual nationality is problematical.
Children of FAS parents born in a state acquire U.S. nationality
and citizenship under Section 1 of the 14th Amendment, and children of
FAS parents born in a territory acquire birthright nationality and/or
citizenship under 8 U.S.C. 1401-1408. Thus, unless there is a statute
mandating that a permissibly defined class of U.S. citizens with FAS
heritage shall be treated as nonimmigrants, interpretation of COFA
Sections 141-143 as a dual nationality scheme in combination with
Section 104(e) of the COFA Act of 2003 is unavailing.
Each of the three FAS constitutions requires FAS citizens who
acquire a second citizenship to make an election between FAS
citizenship and citizenship of any other nation, including the United
States. The FSM and RMI bar to dual citizenship seems to apply to
children born outside the FSM and RMI, since both those constitutional
prohibitions require election at age 18.
3a) Do you think it would be more consistent to conclude that the
number of FAS citizens in the U.S. under the COFA visa waiver
provisions, as well as those counted for purposes of Compact impact
assessment, should be reduced by the percentage of that 94,000 figure
that represents U.S. citizens, regardless of age?
Answer. FAS citizens have the right to reside and work in the
United States and its territories as lawful non-immigrants. According
to the Department of the Interior, Office of Insular Affairs, more than
94,000 Compact migrants from the RMI, FSM, and Palau are estimated to
live and work in the United States and its territories. Among FAS
migrants living in U.S. states in 2013-2017, an estimated 43% were U.S.
citizens, including naturalized citizens and minor-age children of FAS
migrants who were born in the United States and hold dual
citizenship.\23\ The proportion of FAS migrants in U.S. states plus its
Pacific territories who are U.S. citizens is likely to be roughly the
same. In terms of assessing the impact or costs to U.S. states and
territories where FAS migrants live, some FAS people may be both
counted as FAS migrants and hold U.S. citizenship. Although FAS
migrants generally are ineligible for most federal program benefits due
to restriction on non-U.S. citizens under the Personal Responsibility
and Work Opportunity Act of 1996 (P.L. 104-193), some people counted as
FAS migrants for purposes of assessing costs may be eligible for
federal programs due to their U.S. citizenship status.\24\
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\23\ The total number of FAS migrants in U.S. states, the District
of Columbia, and Puerto Rico was 72,965 according to this estimate.
Department of the Interior, ``U.S. Department of the Interior Supports
Solution for Compact Impact,'' May 5, 2023; Government Accountability
Office, Report to the Chairman of the Committee on Energy and Natural
Resources, U.S. Senate, ``Compacts of Free Association: Populations in
U.S. Areas Have Grown, with Varying Reported Effects,'' June 2020, p.
18.
\24\ For an example of how U.S. impacted areas assess costs of FAS
migration, see State of Hawaii Department of Business, Economic
Development & Tourism, ``COFA Migrants in Hawaii,'' February 2020.
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The Compact of Free Association Act of 1985 requires the President
to report annually to Congress on the impact of the Compact on U.S.
territories and commonwealths in the Pacific and on the State of
Hawaii, and to cover the costs ``resulting from any increased demands
placed upon education and social services'' by migrants from the
FAS.\25\ The Compact Amendments Act of 2003 mandated $30 million in
Compact Impact funds be allocated annually for 20 years (2004-
2023).\26\ The apportionment of these funds among the impacted U.S.
Pacific areas is based upon Census enumerations done roughly every five
years.\27\ Since 2012, Congress has annually appropriated additional
discretionary Compact Impact funds, including $6 million for
FY2023.\28\
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\25\ P.L. 99-239, Section 104(e).
\26\ P.L. 108-188, Section 104(e).
\27\ United States Census Bureau, Final Report, ``2018 Estimates of
Compact of Free Association (COFA) Migrants, April 16, 2019.
\28\ Department of the Interior, Congressional Budget
Justifications, Fiscal Year 2024, Office of Insular Affairs.
3b) Do you agree that FAS law determines FAS nationality and
citizenship, and U.S. law determines U.S. nationality and citizenship,
so U.S. laws including the Compacts do not create a formal or legally
defined dual nationality or citizenship for FAS citizens in the U.S. or
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U.S. citizens in the FAS?
Answer. The Immigration and Nationality Act (INA),\29\ the basis of
U.S. immigration law, does not contain provisions on dual citizenship.
Under the Citizenship Clause of the Fourteenth Amendment to the
Constitution and INA Section 301(a) (8 U.S.C. Sec. 1401(a)), persons
born within the United States, on federally recognized tribal lands,
and in designated territories (currently, Puerto Rico, the U.S. Virgin
Islands, Guam, and the Commonwealth of the Northern Mariana Islands)
generally are U.S. citizens at birth, regardless of the citizenship or
immigration status of their parents.\30\
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\29\ The INA is codified in Title 8 of the U.S. Code (8 U.S.C.
Sec. 1101 et seq.)
\30\ For more information, see CRS Legal Sidebar LSB10214, The
Citizenship Clause and ``Birthright Citizenship'': A Brief Legal
Overview and CRS Report R47223, U.S. Citizenship for Children Born
Abroad: In Brief.
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Individuals who are not U.S. citizens at birth may naturalize
pursuant to requirements specified in the INA.\31\ Generally, an
individual must first be a lawful permanent resident (LPR) in order to
be eligible to naturalize. Citizens of the Republic of Palau, the
Federated States of Micronesia, and the Republic of the Marshall
Islands admitted to the United States under the Compacts are not LPRs;
however, they may become LPRs if they are otherwise eligible under the
INA.\32\
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\31\ Generally, in order to naturalize, a foreign national must be
a lawful permanent resident (LPR), meet certain U.S. residence and
physical presence requirements, demonstrate knowledge of U.S. history
and civics and English language ability, have good moral character, and
show attachment to the U.S. Constitution by taking the Oath of
Allegiance in a public ceremony. See INA Sec. Sec. 316, 319 (8 U.S.C.
Sec. Sec. 1427, 1430). Individuals must be at least 18 to naturalize;
children derive citizenship through their parents. The INA contains
special provisions for the naturalization of members of the U.S. Armed
Forces at INA Sec. 328 and Sec. 329 (8 U.S.C. Sec. Sec. 1439, 1440).
For more information, see CRS In Focus IF12322, Naturalization: Policy
Overview and Selected Trends.
\32\ See U.S. Citizenship and Immigration Services, ``Status of
Citizens of the Freely Associated States of the Federated States of
Micronesia and the Republic of the Marshall Islands: Fact Sheet,''
https://www.uscis.gov/sites/default/files/document/fact-sheets/
FactSheetVerifyFASCitizens.pdf, September 2020, and ``Status of
Citizens of the Republic of Palau: Fact Sheet,'' https://www.uscis.gov/
sites/default/files/document/fact-sheets/FactSheet-
Status_of_Citizens_of_Palau.pdf, October 2019.
An individual who naturalizes in the United States may retain the
citizenship of another country if that country permits it. The United
States has no authority to prohibit another country from continuing to
treat an individual as its citizen. See, for example, this guidance
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from the Department of State:
Each country has its own nationality laws based on its own
policy. Persons may have dual nationality by automatic
operation of different laws rather than by choice. For example,
a child born in a foreign country to U.S. national parents may
be both a U.S. national and a national of the country of birth.
Or, an individual having one nationality at birth may
naturalize at a later date in another country and become a dual
national. U.S. law does not mention dual nationality or require
a person to choose one nationality or another.\33\
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\33\ U.S. Department of State, Bureau of Consular Affairs, ``Dual
Nationality,'' https://travel.state.gov/content/travel/en/legal/travel-
legal-considerations/Advice-about-Possible-Loss-of-US-Nationality-Dual-
Nationality/Dual-Nationality.html.
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A native-born or naturalized U.S. citizen may lose their
citizenship by committing certain expatriating acts if those acts are
committed voluntarily and with the intention of relinquishing U.S.
citizenship.\34\ These include voluntary naturalization in a foreign
country after age 18, making a formal declaration of allegiance to a
foreign country after age 18, serving in the armed forces of a foreign
country engaged in hostilities against the United States, and serving
in the armed forces of a foreign country as an officer. An individual
may also voluntarily renounce their U.S. citizenship before a U.S.
diplomatic or consular officer abroad.
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\34\ INA Sec. 349; 8 U.S.C. Sec. 1481.
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______
Mrs. Radewagen. I thank the witness for their testimony.
The Chair now recognizes Ms. Paskal for 5 minutes.
STATEMENT OF CLEO PASKAL, NON-RESIDENT SENIOR FELLOW,
FOUNDATION FOR DEFENSE OF DEMOCRACIES, WASHINGTON, DC
Ms. Paskal. Chair Radewagen, co-Chair Sablan, distinguished
members of this Task Force, thank you for the honor of being
invited to testify.
The creation of this bipartisan Task Force is timely,
innovative, important, and really heartening.
[Slide.]
Ms. Paskal. I have a map. The Pacific Islands of America
and the U.S. Freely Associated States are essential for
America, especially its Pacific strategy. They form a corridor
of freedom, including freedom of deployment, as we have heard,
from Hawaii to treaty partners Philippines and Japan.
Everything that is U.S. is dark blue, and what is lighter blue
is the FAS. FAS covers about as much of the Pacific as the
continental United States. Very important.
As a result, they are at the receiving end of a long-
running, well-funded, focused, and multi-faceted attack from
the PRC. Beijing's goal is to undermine their relationship with
the United States, weaken their states' institutions, and
ultimately to create a condition in which, as one senior
official told Admiral Keating well over a decade ago, ``You,
the United States, take Hawaii east and we, China, take Hawaii
west.'' I will explain how the PRC is trying to make that
happen. I will also explain the urgent need for combined block-
and-build strategy in which malign influence is blocked, while
at the same time domestic security is built.
One has to assume that any major project designed to build
FAS economic or political independence, especially ones that
will make them less reliant on China, will be targeted for
delay or destruction by PRC agents through a range of gray zone
activities. The biggest targets are the COFAs themselves. They
build U.S. relationship with the FAS and they block through
strategic denial. China wants them gone.
One of the ways that we saw that try to happen recently
involved two Chinese-origin individuals who tried to bring down
the Government of the Marshall Islands. PRC-origin Cary Yan and
Gina Zhou obtained Marshall Islands citizenship and bribed
senior Marshallese officials in an attempt to set up a semi-
autonomous zone within the RMI, one that would have its own
legal regime, including immigration. They came within one vote
of the Marshall Islands Parliament of getting it done. They
were arrested in Thailand and, in September 2022, were
extradited to the United States to face charges.
It sounds like a good outcome, but just wait.
The combined maximum penalties for the charges they faced
are 50 years. The United States gave them a plea deal. Yan got
42 months, Zhou got 31 months. Pretty light, considering they
tried to take over a country, one that is a key component of
America's defense architecture and one of Taiwan's few official
friends.
Zhou's sentence was so light that by the time the case was
closed, she had finished serving her time, and the United
States deported her back to the Marshall Islands, where she is
now walking free, able to re-establish her linkages with the
local elite. I wonder how much she likes the COFAs.
Coincidentally, the Marshall Islands has yet to sign.
The United States can run whatever projects it likes in the
Marshalls, but if it doesn't block this sort of attack on the
core elements of democracy, it will be very hard to ensure
anything positive can be built.
These sort of nation-level attacks are common in the FAS.
China deliberately, as mentioned, built up Palau's tourism
sector. In 2008, Chinese were less than 1 percent of all
tourism; 7 years later it was 54 percent. Then, in 2017, China
pulled the plug on tourism in Palau, making it clear that,
unless Palau switched from Taiwan to China, the tourists
wouldn't come back. It devastated the Palauan economy.
The PRC also uses Chinese organized crime. In 2019 and
2022, Palau and law enforcement deported hundreds, hundreds of
mostly Chinese citizens working in illegal online gambling
operations. The entire population of Palau is about 18,000.
Palauan authorities believe it was just one of many interlinked
plans tied to influence operations by the Chinese Communist
Party.
Unless that malign influence is blocked, no matter how good
the idea is, it will be hard to build. At the same time,
blocking PRC malign influence alone won't work. The region is
still hurting from COVID. And if there is no building, just
blocking social disruptions caused by increasing desperation
could become destabilizing and open up new pathways for PRC
operations that are extremely difficult to block.
Under the Compacts the United States has, as mentioned, an
obligation to defend the Marshall Islands and the Federated
States of Micronesia and Palau from attacks or threats. China
is managing to stay below the triggering threshold of the tools
of the Compact that could help the FAS block and build because
of Washington's self-imposed limits on defining what a threat
or attack looks like. This needs to change.
As a start, there needs to be a cost for taking Chinese
money. Currently, there is rarely a downside to accepting that
brown envelope after the banquet. A few high-profile cases
could hearten honest officials, and make others recalculate
their cost benefit analysis of selling out their country and,
by extension, the United States of America.
That also means don't be shy about ensuring transparency
and accountability in the Compact funding spending. The people
of the FAS need to know their money is being spent for their
benefit. This can be reinforced by other initiatives.
Currently, Senator Joni Ernst and others, as well as
Representative Waltz and Connolly are finalizing the CONVENE
Act. The bill is designed to support the FAS in the
establishment of their own national security councils, as well
as other locally-owned blocking-and-building tools. It would
help the Compacts in blocking the PRC political warfare in the
region, while just as actively helping the FAS build their
economies, thus creating the foundation for a true, enduring,
resilient, free Indo-Pacific.
This is why this Task Force is so important and, frankly,
inspiring. It is also why someone in China is likely watching
this right now, trying to figure out how to make it
ineffective. Anything good needs to be protected. That includes
the COFAs. We need to build, but we also need to block across
the entire gray zone. Thank you.
[The prepared statement of Ms. Paskal follows:]
Prepared Statement of Cleo Paskal, Non-Resident Senior Fellow,
Foundation for Defense of Democracies
Introduction
Chair Radewagen, Co-Chair Sablan, and distinguished members of this
task force, thank you for the privilege and honor of being invited to
testify today. The creation of this bipartisan Indo-Pacific Task Force,
under the auspices of the Committee on Natural Resources, is
innovative, timely, and important--and heartening.
By its very composition, this task force shows how much the United
States is not just a Pacific country but a Pacific Islands country,
with its chair from American Samoa, its co-chair from the Commonwealth
of Northern Mariana Islands (CNMI), and distinguished members from Guam
and Hawaii. There is an enormous depth of knowledge in this room. That
combined with the truly bipartisan nature of the task force gives hope
that real solutions can be found for some of the critical threats
facing region.
The threats are real--and urgent. The Pacific Islands of America
(PIA) and U.S. Freely Associated States (FAS) are at the receiving end
of a long running, well-funded, focused, and multifaceted attack by the
People's Republic of China (PRC). Beijing's goal is to undermine these
entities' relationships with the United States, weaken their state
institutions, and ultimately to create the conditions in which, as one
senior Chinese official told Admiral Timothy Keating: ``You take Hawaii
east. We'll take Hawaii west.'' \1\
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\1\ Donna Miles, ``China Requires Close Eye as It Expands
Influence, Capability,'' American Forces Press Service, March 12, 2008.
(https://www.dvidshub.net/news/17315/china-requires-close-eye-expands-
influence-capability)
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This testimony will describe some of the ways in which China is
trying to accomplish that goal, with examples from each of the FAS. It
will also describe how, in each of the FAS, what the United States, in
partnership with the people of the PIA and FAS, can do to fight back,
including adopting a ``Block and Build'' strategy in which malign
influence is blocked while concurrently domestic security (including
economic security) is built.
Block and Build
Fundamentally what's needed is a ``Block and Build'' approach in
which vulnerable entities, with the support of allies if needed, block
malign Chinese influence while simultaneously building domestic
security (including economic security).
Given the advanced state of PRC influence operations in the region
(described in more detail below), one has to assume that any major
project designed to give the FAS economic or political independence
(build), especially ones that will make them less reliant on China,
will be targeted by PRC agents and slowed down through a range of grey
zone tactics, from bureaucratic stalling to unfair competition, from
information warfare to lawfare. Unless that targeting is blocked, it
will be very hard to build.
At the same time, blocking PRC malign influence alone won't work.
The region is still hurting from Covid-linked economic collapse and, if
there is no building, just blocking, social disruptions caused by
increasing desperation could become destabilizing and open up new
pathways for the PRC that are extremely difficult to block.
The title of this hearing asks ``How the Compacts of Free
Association Support U.S. Interests and Counter the PRC's Influence.''
They do it in part by giving the United States the tools necessary to
Block and Build in the FAS.
As Chair Radewagen put it at the launch of this task force, the
Compacts are: ``One of most important tools that the United States has
in supporting democracy and good governance while denying China the
ability to project strategic power throughout the vast Pacific
region.'' \2\
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\2\ House Committee on Natural Resources GOP, ``Indo-Pacific Task
Force Announcement,'' YouTube, June 7, 2023. (https://www.youtube.com/
watch?v=XxTa3eLxgfg)
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That tool, however, is underutilized in some cases and even mis-
utilized at times. With financial and service renewal sections of the
Compact coming to Congress soon, this task force couldn't be timelier.
The stakes are high. If a block and build strategy that dovetails with
the Compacts isn't adopted, there is a real risk that not only will the
long-standing familial relationship with the people of the FAS be
betrayed, but the United States' Pacific military strategy could
collapse.
Geographic Importance of the Region (Map at End)
As others in this hearing will describe in more detail, the core
American Pacific military strategy for decades has been to reinforce
the First Island Chain off the coast of Asia (the string of islands
broadly running north-south from Japan, through Taiwan, Philippines,
and on past Malaysia). This is reinforced by another broadly north-
south chain just to the east, the Second Island Chain (definitions
vary, but it roughly runs from Japan, onward to the Commonwealth of
Northern Marianas, Guam, the Federated States of Micronesia, Palau,
Indonesia, Papua New Guinea, and then Australia).
The Pacific Islands of America and the U.S. Freely Associated
States have made the island chain strategy to be possible.
The Pacific Islands of America include the unincorporated United
States insular areas (also known as territories) of American Samoa,
Baker Island, Guam, Howland Island, Jarvis Island, Johnston Atoll,
Kingman Reef, Midway Atoll, the Commonwealth of the Northern Mariana
Islands (CNMI), and Wake Island. Palmyra Atoll, which includes about 50
small islands a thousand miles or so south of Honolulu, is America's
only incorporated insular territory.\3\ The Exclusive Economic Zones
(EEZ) of the PIA combine to cover over 750,000 square miles, or roughly
the surface area of Turkey.\4\
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\3\ ``Definitions of Insular Area Political Organizations,'' U.S.
Department of the Interior, Office of Insular Affairs, accessed 12 June
2023. (https://www.doi.gov/oia/islands/politicatypes)
\4\ Alexander B. Gray and Douglas W. Domenech, ``U.S. Territories:
The Frontlines of Global Competition With China,'' RealClearDefense,
March 11, 2021. (https://www.realcleardefense.com/articles/2021/03/11/
us_territories_the_frontlines_of_global_competition_with_china_767683.ht
ml)
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The United States also has Compacts of Free Association (COFAs)
with three independent countries: the Republic of Palau, the Republic
of the Marshall Islands (RMI), and the Federated States of Micronesia
(FSM)--together known as the Freely Associated States (FAS).
Combined, their EEZs cover a vast area of the Pacific comparable in
size to the continental United States.
Through the COFAs, the three FAS have voluntarily granted the
United States uniquely extensive defense and security access in their
sovereign territories. In the words of the Compacts: ``The Government
of the United States has full authority and responsibility for security
and defense matters in or relating to the Marshall Islands and the
Federated States of Micronesia [and Palau].'' \5\
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\5\ Compact of Free Association Act of 1985, Pub. L. 99-239, 99
Stat. 1770, codified as amended at 48 USC Sec. 1681. (https://
www.Congress.gov/99/statute/STATUTE-99/STATUTE-99-Pg1770.pdf); Trust
Territory of the Pacific Islands, Pub. L. 99-658, 100 Stat. 3672,
codified as amended at 48 USC Sec. 1681. (https://www.Congress.gov/99/
statute/STATUTE-100/STATUTE-100-Pg3672.pdf)
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This includes control over key aspects of strategic decision-
making, such as the prerogative for the United States to set up and
operate U.S. military bases in the countries \6\ and a veto over other
countries' military access to the region.\7\
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\6\ Thomas Lum, ``The Compacts of Free Association,'' Congressional
Research Service, August 15, 2022. (https://crsreports.Congress.gov/
product/pdf/IF/IF12194/1)
\7\ In broad terms, apart from defense and security provisions, the
COFAs also give citizens of the FAS the right to work in the United
States and to serve in the U.S. military and they provide financial
support and services (such as the postal service) to the government and
people of the FAS. The financial and service provisions are
renegotiated every 20 years and are currently up for renewal, expiring
in FSM/RMI in 2023 and Palau in 2024.
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Combined, the PIA and the FAS extend the defensive perimeter of the
United States to the waters of America's treaty allies, the Philippines
and Japan, and through them to Taiwan. This `corridor of freedom'
(including freedom of movement) underpins American strategic planning
in the Pacific and makes the island chain defenses possible.
It is one of the many reasons Ranking Member Raul M. Grijalva's
comment at the launch of this Task Force about ``how grateful we are
for the role these insular areas have played for this country'' \8\ was
so apt.
---------------------------------------------------------------------------
\8\ House Committee on Natural Resources GOP, ``Indo-Pacific Task
Force Announcement,'' YouTube, June 7, 2023. (https://www.youtube.com/
watch?v=XxTa3eLxgfg)
---------------------------------------------------------------------------
Targeting the FAS
No other countries on the planet have such a deep defense
relationship with the United States as do the FAS. The privileges and
access granted to the United States by the FAS are unique. However,
they are rarely discussed or examined and seem to have just become a
`given' in American strategic planning.
At the same time, those ties are a direct threat to China's
ambitions, including its desire to push the United States back to
Hawaii. And Beijing has been doing something about it. Others at this
hearing will be covering the military aspects of China's attempts to
infiltrate, coopt, and control the land, sea, and airspace of the FAS.
While China is in the process of setting up those kinetic warfare
capabilities in the region, it is also already well advanced on the
political warfare front, which is what this testimony will focus on.
China has put enormous effort into understanding the social,
political, and economic dynamics of the Pacific islands. In any country
with which China has diplomatic relations, Beijing has a large embassy
with staffers who speak the local language and have seemingly limitless
funds to spend on influence and entertainment. In countries like the
Marshall Islands and Palau, which recognize Taiwan, Beijing maintains
unofficial operating nodes. The one in Marshall is considered locally
as an unofficial embassy.
Since 2012, at least six Oceania-specific research centers have
been set up in China, including Liaocheng University's Research Centre
on Pacific Island Countries, which has a full-time staff of close to 40
researchers.\9\
---------------------------------------------------------------------------
\9\ Denghua Zhang, ``Growing Academic Interest in the Pacific--
Pacific Research Centres in China,'' Australian National University
Department of Pacific Affairs, February 2020. (http://
dpa.bellschool.anu.edu.au/sites/default/files/publications/attachments/
2020-02/dpa_in_brief_2020_ 2_zhang_final.pdf)
---------------------------------------------------------------------------
This official research is augmented by inputs from Chinese
businesses in the region that are, as per China's 2017 National
Intelligence Law, legally obligated to support the government's
intelligence operations.\10\
---------------------------------------------------------------------------
\10\ National Intelligence Law of the People's Republic, (Adopted
at the 28th meeting of the Standing Committee of the 12th National
People's Congress on June 27, 2017), (China). (https://cs.brown.edu/
courses/csci1800/sources/2017_PRC_NationalIntelligenceLaw.pdf)
---------------------------------------------------------------------------
They are also supplemented by Chinese organized crime. This
deployment (or at the very least sufferance) of criminal elements to
advance CCP objectives is something that is becoming more prevalent or
at least more visible, and it was overt during the crackdown in Hong
Kong.\11\
---------------------------------------------------------------------------
\11\ Gerry Shih, ``China's backers and `triad' gangs have a history
of common foes. Hong Kong protesters fear they are next.'' The
Washington Post, July 23, 2019. (https://www.washingtonpost.com/world/
asia_pacific/chinas-backers-and-triad-gangs-have-history-of-common-
foes-hong-kong-protesters-fear-they-are-next/2019/07/23/41445b88-ac68-
11e9-9411-a608f 9d0c2d3_story.html)
According to the Organized Crime and Corruption Reporting Project's
December 2022 report on the Chinese Communist Party and triads in
---------------------------------------------------------------------------
Palau:
``In 2019 and 2020, Palauan law enforcement detained and
deported hundreds of mostly Chinese citizens working in illegal
online gambling operations based in the country. The operations
are just the latest in a string of questionable ventures by
ethnic Chinese business people in the country, including U.S.-
sanctioned senior triad figure Wan Kuok Koi, also known as
`Broken Tooth'. Palauan authorities believe the plans are
interlinked, and tied to influence efforts by the Chinese
Communist Party (CCP). The Chinese push into Palau has been
facilitated by long-time Chinese expatriates in the country, as
well as members of the local elite. Among these prominent
locals have been two former presidents''.\12\
---------------------------------------------------------------------------
\12\ Bernadette Carreon, Aubrey Belford, and Martin Young,
``Pacific Gambit: Inside the Chinese Communist Party and Triad Push
into Palau,'' Organized Crime and Corruption Reporting Project,
December 12, 2022. (https://www.occrp.org/en/investigations/pacific-
gambit-inside-the-chinese-communist-party-and-triad-push-into-palau)
Across the region, the PRC strategy seems to entail the use of
unrestricted warfare tactics, including bribery and blackmail, to
undermine sovereignty and increase PRC influence. This can be described
as entropic warfare, as China actively seeks to destabilize and weaken
target countries to make them easier to dominate and control.\13\ The
definition of entropy is: ``a process of degradation or running down or
a trend to disorder.'' Entropic warfare paralyzes a target country's
(political, legal, economic, social [and ultimately, if they have one,
military]) ability to respond or defend itself, allowing Beijing to win
without fighting.
---------------------------------------------------------------------------
\13\ Cleo Paskal, ``China Winning Entropic Warfare in Pacific
Islands,'' Sunday Guardian (India), June 4, 2022. (https://
www.sundayguardianlive.com/news/china-winning-entropic-warfare-pacific-
islands)
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Federated States of Micronesia (Missed Opportunity to Block and Build)
This is what then President of FSM David Panuelo was describing in
his March 9, 2023, letter,\14\ in which he writes not only how PRC
bribery affect national security but that the PRC is actually working
to create the conditions to break up the country itself by supporting
separatist movements:
---------------------------------------------------------------------------
\14\ Cleo Paskal, LinkedIn, March 10, 2023. (https://
www.linkedin.com/posts/cleopaskal_panuelo-letter-on-switch-to-taiwan-
prc-activity-7039672476045340672-8RmJ)
``Senior officials and elected officials across the whole of
our National and State Governments receive offers of gifts as a
means to curry favor. The practical impact of this is that some
senior officials and elected officials take actions that are
contrary to the FSM's national interest, but are consistent
with the PRC's national interests . . . So, what does it really
look like when so [many] of our Government's senior officials
and elected officials choose to advance their own personal
interest in lieu of the national interest? After all, it is not
a coincidence that the common thread behind the Chuuk State
secession movement, the Pohnpei Political Status Commission
and, to a lesser extent, Yap independence movement, include
---------------------------------------------------------------------------
money from the PRC and whispers of PRC support.''
In his letter, Panuelo outlined what would be required for the FSM
to recognize Taiwan, in effect offering the United States a rare
opportunity to transform the region and support Block and Build. Doing
so would have, over time, blocked the sort of PRC-instigated economic
and social disruptions (entropic warfare) he described and would give
FSM the space to build its economy and society in a resilient and
sustainable manner.
It also would have led to all three FAS recognizing Taiwan,
reinforcing each other politically, and creating opportunities for
cooperation that increase strategic depth, such as illegal fisheries
patrols throughout FAS waters that include Taiwanese representatives.
Additionally, it would have been a major psychological boost to
those trying to fight PRC influence--a counter to the PRC's
inevitability narrative, which tries to inculcate the idea that
resistance is futile.
Yet Washington failed to seize this critical opportunity. As part
of putting together a future strategy, it is important to understand
why neither the State Department nor any other arm of the federal
government actively followed up on Panuelo's offer.
Marshall Islands--The Department of Justice Inadvertently Undermines
Block and Build
A recent case involving two Chinese-origin individuals who tried to
bring down the government of the Marshall Islands--and what the
Department of Justice (DoJ) did about it--is just as worthy of inquiry.
The Republic of the Marshall Islands recognizes Taiwan and is home
to an important U.S. military base at Kwajalein. RMI will hold
elections in November 2023, and, unlike Palau and FSM, it has yet to
sign in the current round of Compact negotiations.
The Marshallese sacrificed dearly, including through 67 nuclear
tests conducted by the United States,\15\ to contribute to America's
defense. But, as we've seen, the PRC's preferred battlefield today is
political--with the goal of obviating the need for kinetic warfare
(i.e., to win without fighting)--or to ease the way for a kinetic win
if required.
---------------------------------------------------------------------------
\15\ Hart Rapaport and Ivana Nikolic Hughes, ``The U.S. Must Take
Responsibility for Nuclear Fallout in the Marshall Islands,''
Scientific American, April 4, 2022. (https://
www.scientificamerican.com/article/the-u-s-must-take-responsibility-
for-nuclear-fallout-in-the-marshall-islands)
---------------------------------------------------------------------------
As seen in FSM, the United States' focus on kinetic defense has not
been matched by a concern for defense against China's political
warfare. In fact, in some cases, the United States takes misguided and
short-sighted actions that only make things easier for the PRC.
An example is the case of PRC-origin Cary Yan and Gina Zhou. Yan
and Zhou obtained Marshall Islands passports and then set about trying
to undermine the sovereignty and integrity of the Marshall Islands. The
incident details below comes from Department of Justice documents.
By December 2016, Yan and Zhou were meeting with RMI officials in
both New York City and the RMI itself, proposing the development of a
semi-autonomous region within the RMI.
Around April 2018, an NGO controlled by Yan and Zhou hosted a
conference in Hong Kong attended by, among others, members of the RMI
legislature. The NGO paid for the travel, accommodations, and
entertainment of the RMI officials. There, the NGO, with the support of
the legislators, publicly launched an initiative to establish the so-
called Rongelap Atoll Special Administrative Region (the ``RASAR'').
RASAR was to be created by legislation (the ``RASAR Bill'') that,
if enacted by the RMI legislature, would significantly change the laws
on the Rongelap Atoll, including relaxing immigration regulations.
U.S. Immigration and Customs Enforcement described RASAR as: ``a
multi-year scheme that included establishing a nongovernmental
organization and allegedly bribing officials in the Republic of the
Marshall Islands with the intention of establishing a semi-autonomous
region, akin to Hong Kong, in the U.S.-defended Marshall Islands.''
According to the DoJ's sentencing submission, Yan: ``played a long
game. He acquired a[n] unaffiliated NGO, in order to position himself
to bribe numerous RMI officials. When those initial bribes failed to
accomplish Yan's goal of establishing the RASAR, he sought to boot the
RMI's then-President from office. And although that attempt failed,
when there was a change in administrations, Yan worked with the
officials he had bribed to try again. It was only the combination of
the pandemic and the charges in this case that ultimately foiled Yan's
efforts.'' \16\
---------------------------------------------------------------------------
\16\ ``Yan Sentenced To 3.5 Years For Marshall Islands Bribery
Scheme,'' FCPA Professor, accessed June 11, 2023. (https://
fcpaprofessor.com/yan-sentenced-3-5-years-marshall-islands-bribery-
scheme)
---------------------------------------------------------------------------
On November 16, 2020, Yan and Zhou were arrested in Thailand. On
September 2, 2022, they were extradited to the United States and
arrived in New York and charged with conspiring to violate the Foreign
Corrupt Practices Act (FCPA), violating the FCPA, conspiring to commit
money laundering, and committing money laundering.
At the unsealing of the indictment against Yan and Zhou, Assistant
Attorney General Kenneth A. Polite, Jr. said: ``Yan and Zhou allegedly
engaged in a multi-year scheme to bribe elected officials in the
Marshall Islands and to corrupt the legislative process.'' \17\
---------------------------------------------------------------------------
\17\ United States Attorney's Office Southern District of New York,
Press Release, ``U.S. Attorney Announces Extradition Of Two Defendants
Charged With Bribing High-Level Officials Of The Republic Of The
Marshall Islands,'' September 2, 2022. (https://www.justice.gov/usao-
sdny/pr/us-attorney-announces-extradition-two-defendants-charged-
bribing-high-level-officials)
---------------------------------------------------------------------------
U.S. Attorney Damian Williams added: ``Yan and Zhou's bribes
blatantly flouted the sovereignty of the Republic of the Marshall
Islands and its legislature.'' \18\
---------------------------------------------------------------------------
\18\ Ibid.
---------------------------------------------------------------------------
The maximum penalties for these charges are five years in prison
for conspiring to violate the FCPA; five years in prison for each
violation of the FCPA; 20 years in prison for conspiring to commit
money laundering; and 20 years in prison for committing money
laundering.
Yan and Zhou each pled guilty to one count of conspiracy to violate
the anti-bribery provisions of the Foreign Corrupt Practice Act, with
Yan getting 42 months \19\ and Zhou 31 months.\20\
---------------------------------------------------------------------------
\19\ United States Attorney's Office Southern District of New York,
Press Release, ``Defendant Sentenced To 42 Months In Prison For
Conspiring To Bribe High-Level Officials Of The Republic Of The
Marshall Islands,'' May 16, 2023. (https://www.justice.gov/usao-sdny/
pr/defendant-sentenced-42-months-prison-conspiring-bribe-high-level-
officials-republic)
\20\ Department of Justice, Press Release, ``Former Head of Non-
Governmental Organization Sentenced for Bribing Officials of Republic
of Marshall Islands,'' May 16, 2023. (https://www.justice.gov/opa/pr/
former-head-non-governmental-organization-sentenced-bribing-officials-
republic-marshall)
---------------------------------------------------------------------------
This might seem like a win for `blocking,' yet due to the pleas,
and consideration for time served, their actual sentences were light
considering they tried to take over a country--one that is a key
component of America's defense architecture and one of Taiwan's few
official friends.
DOJ also surrendered the opportunity to take the case to trial,
which could have served as a powerful deterrent to future political
warfare and would have made public the names of the Marshallese who
were bribed.
As in the case of Panuelo's Taiwan offer being made and then
ignored, Washington turned what could have been a major `blocking' win
into a loss that was worse than if there had been no opportunity at
all.
Nor, according to RMI officials, have case details been passed to
RMI authorities so Yan and Zhou, and the officials they bribed, can be
prosecuted in Marshall Islands. This potentially leaves some of those
corrupt officials free to run in the upcoming November 2023 elections.
More concerning, Zhou's sentence was so light that she had finished
serving her time soon after the case was closed, and the United States
deported her back to the Marshall Islands.
She is currently there, walking free, able to re-establish her
linkages with local elites, and showing by her mere presence that there
is little downside to taking or giving Chinese bribes. She is expected
to be joined soon by her co-conspirator who is also likely to be
deported back to the Marshalls by the United States once he has served
his time. He may even get there in time to vote in the elections.
This isn't an unusual occurrence. Across the FAS, there are
Chinese-deemed `undesirables' that the FAS government can't themselves
deport. In some cases, the PRC refuses to admit the undesirables are
PRC citizens (because keeping them in country aids PRC entropic
warfare). In other cases, the FAS simply doesn't have the money or
political weight to deport them. And so they stay, undermining the
countries from within. Sometimes, as in this case, because of the
United States Department of Justice.
Palau--A President's Ideas on How to Block and Build
There are leaders across the FAS who, though beleaguered, are still
fighting to block malign influence and build their countries. One is
President Surangel Whipps, Jr. of Palau. Palau recognizes Taiwan and
was the target of an elaborate political warfare operation by China to
try to change that.
Beijing first worked to build up Palau's dependence on Chinese
tourism. In 2008, there were 634 Chinese tourists in Palau, less than 1
percent of all tourists. By 2015, it was more than 91,000, or around
54%.\21\ Then, in 2017, China pulled the plug, making it clear that,
unless Palau switched from Taiwan to China, the tourists wouldn't come
back. This devastated the economy and left empty and crumbling Chinese-
leased real estate and developments across the country--a formidable
display of entropic warfare.
---------------------------------------------------------------------------
\21\ Kate Lyons, ``'Palau against China!': the tiny island standing
up to a giant,'' The Guardian (UK), September 7, 2018. (https://
www.theguardian.com/global-development/2018/sep/08/palau-against-china-
the-tiny-island-defying-the-worlds-biggest-country)
---------------------------------------------------------------------------
Palau, however stood firm. But it was not easy, especially after
Covid added a second hit. President Whipps, in preparation for this
hearing, was kind enough to give concrete examples of what he thinks
his country needs to block and build economically.
He said: \22\
---------------------------------------------------------------------------
\22\ Interview with President Surengel Whipps, Jr., June 8, 2023.
Our biggest challenges are trying to build a diversified,
resilient economy, combat[ing] climate change, and combat[ing]
---------------------------------------------------------------------------
the influence of [the] Chinese in Palau.
Our economy was devastated by Covid. Tourism isn't back. We are
at 30 percent of pre-Covid numbers. Palau's GDP fell, so we
were accessible for [GDP-level linked] DFC [U.S. International
Development Finance Corporation]. But why were we even taken
off DFC? We shouldn't need measures like that to keep us out.
One of our main challenges is direct investment. The largest
direct investor in Palau is still China. It's a challenge to
try to not open up direct flights from China back to Palau. I'm
going to Japan next week to talk about direct flights, but they
might not be back until next year. Right now, there are two
flights a week from Taiwan, they are full. They can't increase.
I've just been to Korea trying to get Koreans to start direct
flights because Korea is about five hours away. Korean tourists
are among the top tourists going to Guam. One airline was
interested in Palau but they said the runway wasn't quite long
enough for the large aircraft. It means a 30 percent penalty in
cost--it'll cost 30 percent more than flying to Guam. That
makes Palau less interesting.
Meanwhile, for several years, the U.S. government said our
runway wasn't quite long enough for F-35s.
We proposed a solution to the United States, and to Australia,
Taiwan, Japan, Korea--help us extend the runway to 3,000m from
2,100m. It would help in deterrence. We believe peace comes
through strength, but a strong a resilient economy also
provides deterrence.
That's the sort of area where there is a synergy, where we can
do what's good for defense and for the economy. It's an
opportunity where maybe we can encourage investment from others
in the region, other investment instead of China. We really
need to work with others in the region to encourage investment.
We need partnerships. This year finally for [the] first time
Japanese investment in tourism will surpass everyone else--
there is a new Japanese hotel being built. We want to see U.S.
investment here--a U.S. hotel. We are really trying to bring
others here.
We have pressure to open up direct flights to Macau and Hong
Kong from Cambodian carriers. Japan is slow, Korea is slow,
Taiwan is slow--China is saying `give us more flights.' It's
hard to say we won't accept them because hotels are empty,
boats are empty.
Another concern is that, if not handled by others, environmental
crises could be opportunities for China to act. We've seen the PRC use
humanitarian assistance and disaster relief as a reason to deploy and
embed, as seen in Tonga following the devastating volcano eruption.
According to Whipps:
FEMA accessibility is really important to Palau. It's Russian
roulette out here. Look at what just happened to Guam. Those
systems move up to Guam, down to Yap, down to Palau.
If something happens, it [is] a matter of who's closest to our
door. Who's fastest to respond? When that disaster happens, who
will jump out to say `here we are to help you?' The last
typhoon, we got more assistance from the Federated States of
Micronesia than the United States.
One way to block and build on this front is to support the
development of local capacity to handle crises and also to be better
coordinated with the United States. Palau has tried to lead the way on
this by setting up a National Security Coordinator office, but in spite
of it proving its worth over and over again to the United States, it
gets little support.
Similarly, there is an enormous untapped resource in the FAS--the
large number of FAS citizens who are American military veterans.
Properly organized, perhaps as a variation on reserves but answerable
to the FAS governments, they could be invaluable in crises and serve as
bridges to U.S. responders. According to Whipps:
There has been some traction on addressing the needs of
veterans, but they really need it to be enacted. Why [do]
veterans . . . in Philippines and Canada receive more benefits
than . . . ones in the FAS?
We want them to retire back in the islands--wouldn't it be
wonderful if they return to Palau and receive full benefits in
Palau? Then they can be comfortable while contributing to the
economy and security of Palau.
It [is] an economically small thing for the U.S. but huge when
it comes to improving the lives and security in Palau.
Something like 5 percent of graduating high school students
join the U.S. military. We are happy to let them come and
recruit, but when they are done, please take care of them.
Please don't forget them.
That means being able to see a local doctor here and get the
care they need. There are rules that make it difficult, like to
get counselling online you need to be on U.S. soil. Also, many
have to pay for [their] own tickets to get to Guam for
assessment. The United [Airlines] flight to Guam is, per mile,
among [the] most expensive in world. In the last years, two
veterans have taken their lives in Palau.
Conclusion and recommendations
Under the Compacts, the United States has an ``obligation to defend
the Marshall Islands and the Federated States of Micronesia [and Palau]
and their peoples from attack or threats.'' \23\
\23\ Compact of Free Association Act of 1985, Pub. L. 99-239, 99
Stat. 1770, codified as amended at 48 USC Sec. 1681. (https://
www.Congress.gov/99/statute/STATUTE-99/STATUTE-99-Pg1770.pdf)
China is managing to stay below the `triggering' threshold of the
tools in the Compact that could help the FAS block and build because of
Washington's self-imposed limits on defining what a threat or attack
looks like--which, at this stage, given what is being ignored, seems to
involve something as overt as a World War Two-style amphibious storming
---------------------------------------------------------------------------
of the beaches. This needs to change.
At its most basic, this means that rather than sending Chinese who
have been found guilty of trying to ``corrupt the legislative process''
of the Marshall Islands back to the Marshalls (and then not sharing
case information with the relevant authorities in Marshall so they can
at least prosecute the cases themselves), the United States could help
set up special investigative units to uncover and prosecute corruption
in the FAS.
Currently, given the degree of involvement of Chinese organized
crime and the tight knit nature of FAS societies, there is concern
about going after the big fish. The 2019 murder of an American lawyer
who was Acting Attorney General of FSM created fear across the
region.\24\
\24\ Bernadette Carreon and Lauren Aratani, ``Murder in Yap: sleepy
Pacific island rocked by shooting of American lawyer,'' The Guardian
(UK), November 20, 2019. (https://www.theguardian.com/world/2019/nov/
21/in-yap-sleepy-pacific-island-rocked-by-shooting-of-american-lawyer)
If welcomed by the FAS, it might make sense for the U.S. military
to assist on some of the investigations. The Department of Defense has
the largest American presence on the ground in the FAS and knows and
---------------------------------------------------------------------------
possibly values the region the best.
The most fundamental aspect of blocking is that there needs to be a
cost for taking Chinese money. Currently, there rarely is a downside to
accepting that brown envelope after the banquet. At the very least,
Magnitsky Act charges or something similar could be explored. Just a
few high-profile cases could hearten honest officials and make others
recalculate their cost/benefit analysis of selling out their country--
and by extension, U.S. security. (That can also mean not being shy
about ensuring transparency and accountability in the Compact funding
spending. The people of the FAS need to know their money is being spent
for their benefit.)
Similarly, given the dual-use nature of the Chinese fishing fleet,
illegal fishing in the FAS should be seen as a national security issue
for the United States. The U.S. military should be defending FAS EEZs
aggressively. But that blocking is not enough. Simultaneously, there
should be efforts to help the FAS build their fisheries in a way that,
as President Whipps said in reference to tourism, is diversified and
resilient. That is the only way to truly keep out the malign influence.
When the pieces combine, the overall goal would be to create a
Micronesian Zone of Security, Prosperity, and Freedom that would knit
the PIA and FAS (and maybe eventually Nauru and Kiribati) together,
letting the countries and territories reinforce each other socially and
economically, supported by the exceptional tools made available by the
Compacts.
Doing that means actively blocking PRC political warfare in the
region while, just as actively, helping the PIA and FAS build their
economies, thus creating the foundation for an enduring and resilient
free and open Indo-Pacific.
In that context, it's worth understanding what happens if the
financial and services components of the Compacts aren't passed.
According to the U.S. Integrated Country Strategy for the FSM:
The future of many of the 50 plus USG components operating in
the FSM also appears uncertain. Absent action from Congress,
several will end their operations in 2024, including [the
Federal Aviation Administration], [the Federal Deposit
Insurance Corporation], the Post Office, and the hybrid COFA
disaster response mechanism that is funded by [Federal
Emergency Management Agency] and implemented by [the U.S.
Agency for International Development]. The presence in the FSM
of the remaining 45 plus agencies after 2023 is also in
question . . . Absent other countervailing factors, the
reduction in US foreign assistance portends likely greater
economic and political instability in the FSM after 2023.\25\
---------------------------------------------------------------------------
\25\ U.S. Department of State, ``Integrated Country Strategy:
Federated States of Micronesia,'' August 16, 2018. (Archived version
available at: https://www.state.gov/wp-content/uploads/2019/01/
Micronesia.pdf)
As Whipps said: ``It's very important that the Compact agreement on
economic assistance be passed this year. Last time, we started in 2010,
but it wasn't signed until 2018. That sends a bad signal to Palau and
the Pacific about U.S. commitments. Economic stability provides
security for all of us.''
This is why this task force is so important and, frankly,
inspiring. What's needed to block and build is a broad and deep
understanding of the Compact, region and issues, and a willingness to
find innovative, effective solutions. Combined, the fourteen members of
this task force have what it takes. Thank you for stepping up to the
challenge. It is one of the most important of the century.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Questions Submitted for the Record to Cleo Paskal, Non-Resident Senior
Fellow, Foundation for Defense of Democracies
Questions Submitted by Representative Westerman
Question 1. The U.S. agencies that take part in COFA negotiation
and implementation--such as the Department of the Interior, Department
of State, and Department of Defense--have a significant impact on U.S.
relation with the FAS. The decision to authorize and appropriate
funding for the agreement to a certain agency can send signals to the
other party on how the U.S. views the relationship, as each agency
represents a certain level of American policy. For example, programs
administered by the Department of Defense often carry defense
connotations. It is vital to be aware of the signals we send to our
partners in the region when designating the implementing agency, and
how those partners feel about those signals. As such, we must
understand how various agencies are perceived by the FAS when framing
our future discussions on COFA renewal.
1a) How have FAS perceptions of the U.S. been shaped by the various
agencies that have been responsible for managing relations with the FAS
governments?
Answer. A range of factors go into shaping FAS perceptions of the
United States, including the American military's behavior in the post-
War period, personal experiences of visits to the United States, the
experience of friends and relatives based in the United States, the
experience of FAS citizens who served in the United States' military,
etc.
That said, direct experience with different agencies can have a
deep effect on perceptions of the United States government, and on how
those in the FAS involved think Washington views the FAS.
Broadly, apart from the Department of Defense (DoD), there is often
the impression that, regardless of the agency, the United States
government doesn't prioritize its relationship with the FAS. In some
cases, the Department of the Interior is perceived to be, to put it
politely, inefficient or ineffective. State hasn't ensured that
Ambassadors were in post during much of the critical Compact
negotiations window. There have been years of missed agreed payments.
Some promised projects have taken years to materialize.
In the case of DoD, some of the otherwise sound relations are
affected by the use of contractors who behave poorly, the de facto
abandonment of veterans and the lack of community engagement,
especially around project that affect daily lives.
Additionally, even in this latest phase when the United States says
it is prioritizing the Pacific Islands, State and the NSC seem to be
according more importance to the Pacific Island Forum (PIF) and
countries such as Solomon Islands than to the FAS--countries that have
put their lives in the hands of the United States, and two of which
still recognize Taiwan.
The first visit of a sitting President to a Pacific Island Country
was to be to Papua New Guinea, had it not been canceled. And Washington
has appointed a permanent Envoy to the PIF but there is no permanent
office or officer just dedicated to the FAS--three countries not just
in a unique and deep relationship with the United States, but also of
critical strategic value to the United States' Pacific defense
architecture.
Also, there is a widespread perception that there is little
coordinated strategy across agencies or institutional knowledge,
resulting in mixed messages, casual slights, wasted time, and wasted
resources.
Some in the FAS would like to see more presence by specific U.S.
government agencies/departments. In all three FAS, there are some who
would like to tackle corruption, and PRC-linked bribery and organized
crime. They are keen for more engagement by the FBI, DEA, Treasury and
others who might be able to assist.
Getting to the root of it, others would like U.S. help with
stimulating economic growth to benefit their people and ensure PRC
economic overtures are less effective. They would like to see Commerce
get more involved. Across the board, there is a desire for more help
not just with illegal fisheries but with the development of their own
fisheries sectors.
However, based on past experience, the widely held assumption is
that, once the Compacts renewals are done, the FAS will be forgotten by
Washington again (except perhaps by DoD).
1b) How do the FAS perceive the Department of the State versus the
Department of the Interior?
Answer. In many quarters, sincere and dedicated efforts of DOI
staff aside, the perception in the FAS is that the United States
government doesn't consider the Department of the Interior as one of
its `important' Departments, and so working through DOI lowers the
importance, access and influence of the FAS.
Additionally, the perception is that being handled by DOI is a
historical remnant of an earlier time, when they were not sovereign
nations. They are no longer `Interior'. As such, the general sense is
that State is a more appropriate Department, especially given State
seems to be taking the lead in the Compact negotiations.
That said, by far the largest American permanent presence in the
FAS is DoD. DoD also has the most understanding of the importance of
the region, the most invested in the region (literally) and its
interest won't wane once the Compacts are renewed (assuming they are).
Additionally, DoD has the ability to do many of the things the FAS
needs (help with illegal fisheries, environmental disasters,
infrastructure, sorting out issues with veterans, etc., and DoD can
even assist with education, health care, social services, etc., as it
does on bases), and with the large number of FAS citizens serving in
the U.S. military, it is a more `familiar' Department. DoD is also
considered one of most `important' Departments and so well placed to
keep awareness of FAS concerns high on the priority list.
______
Mrs. Radewagen. I thank the witness for their testimony.
The Chair now recognizes Mr. Newsham for his 5 minutes.
STATEMENT OF GRANT NEWSHAM, COLONEL, U.S. MARINE CORPS (RET.),
HONOLULU, HAWAII
Mr. Newsham. Chair Radewagen, co-Chair Sablan, and
distinguished members, thank you very much for inviting me to
testify today. I will focus on the role and importance of the
Compacts of Free Association to U.S. defense and security
interests and countering Chinese influence.
The COFAs underpin the entire United States defense posture
and strategy in the Western Pacific and East Asia. How so? U.S.
Pacific defenses and forces are concentrated on the western
edge of the Pacific, along the so-called first island chain.
Geography and U.S. and partner forces hem in the Chinese
military. However, this defense scheme requires what
strategists call a secure rear area. The COFA states are the
rear area, and U.S. forces must be able to operate freely
there.
The Chinese perspective also shows COFA's value. Chinese
strategists look outward from the Chinese mainland, and they
too see the first island chain, and they want to breach it.
However, as the Chinese look farther east they see another
island chain. And right in the middle of it is the Federated
States of Micronesia, bookended by Palau and the Marshall
Islands. The PRC intends to break these chains and to dominate
the region.
China is building a world-class military, but there is a
problem. Controlling the South China Sea matters little if the
PLA is bottled up inside the first island chain. Thus, China is
trying to leapfrog the first island chain. If the PRC
establishes a foothold or political dominance in the COFA
states, it can break down America's first island chain defense
from behind. The existing U.S. regional strategy will be in
tatters.
Imagine fighting a war in Europe and having to fight your
way across the Atlantic. That will be the Pacific. And even if
there is no shooting war, the Freely Associated States that are
under Chinese domination may resist a U.S. military presence,
regardless of any Compact language. In any event, the U.S.
military will need to devote scarce resources to cover this
threat. These are resources that cannot be used to assist
Taiwan, Japan, and South Korea.
The terms of the Compacts of Free Association do give the
United States the legal right to keep foreign militaries out of
the COFA states. Yet, the COFA agreements can be terminated. Or
suppose a COFA government simply tells the Americans that it
will do what it wants with whoever it wants. What is the United
States going to do, send in the Marines?
China is using political and economic tools to undermine
the U.S. presence in the Freely Associated States, and Chinese
survey ships have recently scouted underseas cables in
Federated States of Micronesia and in Palau against Guam and
CNMI. We have seen cyber attacks, spy balloons, underwater
listening devices to track U.S. submarines, and Guam killer
missiles. Yet, despite this central Pacific strategic military
location, the U.S. military only has four permanent bases in
the region. Only one is in the COFA states, that is on
Kwajalein. The other three are on Guam. Such a limited,
permanent presence seems inexplicable. These are essential for
conducting operations, logistics repair and maintenance,
intelligence collection, and missile defense, among other
things. Having too few bases and operating locations is putting
a lot of eggs in one basket, and vulnerable to the PLA's
strategic rocket force.
The U.S. Air Force and Navy understand the problem. The FAS
provide plenty of places to spread out and stay alive and to
hit back effectively on multiple vectors. Palau, in fact, asked
the U.S. military to establish a base in the country in 2020,
but the Americans have not taken up the offer.
U.S. forces do a lot of routine, large-scale exercises and
training in Guam and CNMI. However, most U.S. military focus is
on the western edge of the Pacific, not in the middle of it.
U.S. military activities elsewhere in the Freely Associated
States include regular, but smaller-scale activities.
Now, some things to do.
First, remember that if you are not there, you are not
interested. In fact, much U.S. military engagement in the
Central Pacific seems ephemeral. Key leader engagements and
other official fly-in visits are of limited value, compared to
Chinese diplomats, officials, and businessmen integrating,
ingratiating, and inserting themselves into local societies.
Indeed, the representative of a Chinese fishing company living
in a COFA state probably has more real influence than any four-
star U.S. admiral. Why? Because he is there.
So, we should expand the U.S. military presence and make it
as permanent as possible. Small units led by junior officers
work fine. Engineering and medical units should be deployed
widely, and there is much demand for such services. The U.S.
State Partnership Program also has promise. Make use of local
veterans. The extensive network of FAS citizens who are U.S.
military veterans can be enormously valuable. Have them serve
as the basis of a local defense force. It just takes some
imagination.
And illegal fishing is a problem that is being admired to
death. What is needed are effective surveillance networks and,
as importantly, the means to actually enforce the laws.
Extend the financial parts of the COFAs. Support for the
Compact states is a necessary maintenance cost. The cost of the
agreements is a pittance compared to the expense of trying to
re-establish a U.S. presence or to hold it in the face of local
opposition.
Now, without the COFAs and the Freely Associated States on
our side, everything we are doing or plan to do militarily in
the Indo-Pacific gets very hard, if not impossible.
And don't forget, you must have the Pacific's non-COFA
states on our side, as well.
And, finally, remember that we can get the military part
right and still lose. We need to get the economic, commercial,
diplomatic, and propaganda parts right, as well.
Thank you very much for having me.
[The prepared statement of Mr. Newsham follows:]
Prepared Statement of Col. Grant F. Newsham
Chair Radewagen, Co-Chair Sablan, and distinguished members of this
Task Force, thank you for the privilege and honor of inviting me to
testify today.
I will be focusing on the role and importance of the Compacts of
Free Association to U.S. defense and security interests and countering
Chinese influence.
Broad Outline of Current U.S. Miliary Pacific Strategy
The Compacts of Free Association (COFAs) with the Republic of
Palau, the Federated States of Micronesia, and the Republic of Marshall
Islands underpin the entire United States defense posture and strategy
in the Western Pacific and East Asia.
U.S. Pacific defenses are concentrated on the western edge of the
Pacific--along the so-called `first island chain'. This `chain' runs
north-south from Japan to Taiwan to the Philippines and on to Malaysia.
One should also include South Korea and Australia as part of this broad
defense line. America has major military bases in Japan and South
Korea, along with expanding military access in northern Australia, and
has recently obtained access to a number of military sites in the
Philippines. Taiwan is also an informal ally.
The thinking behind the strategy is that geography and U.S. forward
deployed and partner forces can serve to hem-in the Chinese military
and restrict the ability of the People's Liberation Army (PLA) to
conduct operations beyond the first island chain.
This somewhat linear U.S. defense scheme requires a secure `rear
area'--particularly for operations and logistics in support of the
forward defenses. The Freely Associated States, along with U.S.
Territories Guam and the Commonwealth of Northern Mariana Islands
(CNMI), occupy what is effectively part of a huge east-west corridor
running from the U.S. West Coast to Hawaii, beyond to Guam and onward
to the first island chain defense line.
One analyst has correctly described this as a `power projection
super-highway.'
The ability of U.S. forces to operate along this corridor--free of
enemy interference--is indispensable. The Guam U.S. Asia Security
Alliance (GUASA) has also described Micronesia--including the Freely
Associated States and Guam/CNMI as constituting ``a natural `plug' '',
potentially closing off the South Pacific and the whole of the
remainder of the Pacific south and east from Asia beyond the
International Dateline,--to Hawaii and past to the West Coasts of North
and South America.''
China Understands the Importance of (Undermining) the COFAs
The military importance of COFA is obvious, if not intuitive, when
viewed from the American perspective. The Chinese perspective is
equally instructive as to COFA's value.
Viewed from a Chinese strategist's perspective, the Central
Pacific's geography is both an obstacle and an opportunity. The easiest
way to understand Chinese thinking is to look at the map of the Western
Pacific with the PRC mainland on the left and the Hawaiian Islands at
the far right. Then, imagine you are hovering over the Chinese mainland
and looking eastwards.
The first thing you see is a chain of islands starting at the
Russian Kuriles in the north and extending southwards through Japan and
the Ryukyus (Okinawa) and onwards to Taiwan. Continue on and the
Philippine archipelago appears, and then the chain ends at the island
of Borneo before anchoring at the Straits of Malacca.
The only way for People's Liberation Army Navy ships and submarines
and PLA Air Force aircraft to penetrate this portion of the first
island chain is via a number of narrow straits. If the occupants of the
land on either side of the `gaps' are unfriendly, it is a small matter
to effectively close off access by employing anti-ship missiles, sea
mines, submarines, and anti-aircraft weapons.
This is a major headache for Chinese defense planners. The founder
of the modern People's Liberation Army Navy, Admiral Liu Huaqing
referred to the first island chain as a `metal chain' restraining
Chinese aspirations.
China does not have any obvious friends anywhere along the first
island chain, especially now that President Ferdinand Marcos has
replaced the mercurial President Roderigo Duterte in the Philippines
and has quickly shifted the country back toward its long-standing
alliance with the United States.
Look at the map and it's easy to understand Chinese interest in
breaching the first island chain--say by threatening Taiwan into
submission--and using force if necessary.
However, as the Chinese strategists look beyond the first island
chain they see another island chain. This one runs from Japan down
through Iwo Jima and onward to Guam and the Commonwealth of Northern
Marianas, and them continues southwards through the Federated States of
Micronesia and on to Indonesia and Papua New Guinea, and then to
Australia. This is the second island chain.
There is even a third island chain running from Alaska through
Hawaii and ending in New Zealand. Although not well remembered these
days in the West as the World War II generation passes away, for
decades the names Tarawa, Saipan, Guam, Tinian, Kwajalein and Peleliu
were widely recognized as synonymous with the bloody fighting the
Pacific. And are resonant in the minds of military planners in China.
The PRC fully intends to break these chains.
China is dead set on building a world class military able to
project power--spearheaded by the Chinese Navy (PLAN)--that is capable
of challenging, and eventually displacing, the United States Navy as
the world's preeminent naval power. The Chinese Navy is well on its
way. For the last decade the PLAN has been launching five ships for
every one the American Navy launches and now has far more surface
combatants than does the US Navy.
American naval strategist, Paul Giarra stated things grimly but
correctly:
Between 2016 and 2020, the Chinese navy has added to its fleet
essentially the equivalent of Japan's entire current surface
fleet . . . . The Chinese navy is building larger and more
formidable surface combatants far faster than anyone else, with
at least eight hulls already launched of a brand-new class of
large surface warships. It is starting to deploy its new
carrier force in ways reflecting [America's] own practice. Its
growing amphibious force is a tangible threat to its neighbors.
The PLA Navy is on track to have nearly twice as many surface
ships as the US Navy before the end of this decade.
And the PLA Air Force is developing its long-range overwater
capabilities equally fast.
But here's the problem for China: in order to employ its new,
powerful Navy (not to mention its Air Force) it must have secure, safe,
ready access to the Pacific. Controlling the South China Sea, and even
the East China Sea matters little if the PLA's enemies can keep it
bottled up inside the first island chain.
If you're a Chinese planner, you might reasonably think China can
with some effort `break' the first island chain--in fact, this is a
prerequisite. It is also why one shouldn't underestimate how serious
China is about capturing Taiwan. Do so and the first island chain is
broken and the PLA has an unsinkable aircraft carrier and launching
point for operations into the Pacific. The problems that create for the
U.S. and allies at that point are obvious.
But, taking a page from the US World War Two playbook, at the same
time China is trying to leapfrog the first island chain. If it can
burrow itself into the second island chain it will roil American (and
Japanese and Australian) defense plans and can potentially break down
first island chain defense from behind.
It is a truism that conducting defensive or offensive military
operations is impossible without a secure `rear area.' If your
adversary is operating behind you or has a presence and/or proxy
influence you will have a very hard time. COFA nations are the `rear
area' of the U.S. Pacific defense strategy.
Should the PRC establish a military foothold or gain political
dominance with de facto strategic veto power in the COFA states, it
will have `leapfrogged' America's island chain defense and ensconced
itself in the U.S.'s once secure `rear area'.
Support for U.S. allies such as Japan and South Korea will become
difficult. Prospects for a successful defense of Taiwan will be much
reduced.
China knows this, which is why undermining the relationship between
the COFA states and the United States is one of Beijing's highest
strategic priorities.
Palau, the Federated States of Micronesia, and the Republic of
Marshall Islands are perfectly situated as footholds from which to
disrupt China's adversaries. If the PLA is deployed in the FAS life
gets difficult for U.S. forces as Chinese aircraft and naval ships
operate from the erstwhile COFA region. And Chinese intelligence and
surveillance has a better platform from which to cover US activities--
and target them. With surface-to-surface missiles, surface-to-air
missiles and Maritime Militia operating aggressively, the US military
will at best be treading carefully, excluded from the area, or taking
casualties.
One Marine noted to the author:
Surface to air and surface to surface missiles turn these
island locations into A2AD (anti-access, area denial) zones.
These islands become an armed picket fence which receive
aircraft for long range patrols and support PLAN operations as
well as replenishment of Chinese subs as well as their
irregular maritime forces, including dual hulled fishing
vessels that cruise at speeds that fish can't keep up with 22-
25 knots.
The existing U.S. strategy will be in tatters.
Imagine fighting a war in Europe and having to fight your way
across the Atlantic. This will be the case if the Chinese are able to
set up in the FAS.
Even if there is not a `shooting war', FAS that are under Chinese
domination--owing to economic and political influence--may adopt a
stance of `belligerent neutrality' and resist a U.S. military presence
in their territories, regardless of any Compact language.
Meanwhile, Chinese intelligence collection would focus on U.S.
forces. Our communications would also be vulnerable.
And this all requires the U.S. military to devote scarce resources
to cover this threat--a threat that wants to encircle and choke U.S.
Pacific territories and come up right up against Hawaii. These are
resources that cannot then be used along the `western defense line'--
say, to assist Taiwan, Japan, or other allies.
China has studied the Japanese seizure and occupation of Micronesia
and large parts of Oceania during World War Two--and it does not intend
to make the same mistakes. Particularly Japan's failure to isolate
Australia and sever lines of communications and supply routes with the
United States.
And while the Japanese saw the Central Pacific as a bastion to keep
the Americans at bay, China's long-term objectives are to use the area
as springboard for expanding eastwards. They are already setting up the
infrastructure on Latin America's west coast.
Indeed, the PRC sees the COFA nations as a power projection super
highway--in the other direction.
However, the terms of the Compact of Free Association between the
FAS nations and the United States are a problem for the Chinese since
the treaties effectively prohibit PLA ships and aircraft from operating
inside COFA state's territorial space.
Yet China is persistent. And while currently a direct military
presence is not feasible, the COFA agreements can be terminated.
Additionally, even if the United States has the sole legal right to
conduct military operations in the COFA states--and even set up
military bases if it wants to do so, local popular and political
support is nonetheless necessary.
China is using political, economic, and other soft-power tools to
undermine the U.S. presence in the Freely Associated States--and even
in the Commonwealth of Northern Marianas, actual American territory,
and thus weaken the US military defenses and capabilities in the
Central Pacific.
Chinese survey ships have been scouting out undersea cables in
Federated States of Micronesia waters in recent years, and have been
doing the same in Palau.
But the PRC has been more aggressive regarding U.S. territories
Guam and CNMI--where the U.S. military presence is greatest.
Recently exposed cyber-attacks, suspected to be from the Chinese
state-sponsored hacker group, Volt Typhoon, was revealed to have
installed malware on critical US military infrastructure on Guam.
Spy balloons too have been hovering over Guam.
But this is nothing new. China has been explicitly threatening,
with suggestions the U.S. military presence puts Guam citizens at risk.
For example, Chinese media and defense commentators refer to the PRC's
DF-26 missile as the `Guam killer'--able to range to U.S. bases on
Guam. And the Chinese have admitted to installing underwater listening
devices in the nearby Marianas Trench--posing a potential threat to
U.S. Navy submarine operations.
Additionally, North Korea has threatened Guam with its new long-
range missiles. Pyongyang's threats, not particularly worrisome to the
local population but causing predictable harm to tourism, presumably do
not displease the PRC--which also played a sizable role in North
Korea's nuclear weapons and missile programs, as well as providing the
mobile TEL launcher vehicles that make the North Korean missiles mobile
and hard to find.
For the Chinese Communist Party to achieve its aspirations, it
needs to at the very least, render the FAS `harmless', and ideally be
able to use them as launch points under its control. No domestic talk
of `friend to all, enemy to none' and `not wanting to get caught in the
middle' will change that until there is a different regime in power in
Beijing. The U.S. didn't come looking for, and doesn't want, this fight
(which ironically has made the fight more likely). If in doubt, just
look at the wide range of options the U.S. has in the Pacific American
Territories and the FAS that haven't been exercised.
Military Installations in the Pacific American Territories and FAS
Despite the Central Pacific strategic military location, the way it
is coveted by China and the hard lessons Americans learned in the 1940s
about the region being in an adversary's possession, the U.S. military
presence is surprisingly small--consisting of only four permanent
military facilities--and only one of these is in the COFA states. That
one is the U.S. Army-administered Ronald Reagan Ballistic Missile Test
Site at Kwajalein Atoll in the Republic of the Marshall Islands.
Kwajalein is a one-of-a-kind facility that would be hard to replace for
any price.
The other bases are on Guam and include the U.S. Naval Base Guam at
Apra Harbor, Andersen Air Force Base--famous as the launch point for B-
52 strikes against North Vietnam during the Vietnam War--and the newly
open U.S. Marine Base, Camp Blaz.
Such a limited permanent presence seems inexplicable, though in the
U.S. military's defense, it might be argued that until the mid-2000s or
even later, there appeared to be no realistic threats to the Central
Pacific. In fact, the U.S. Department of Defense seriously considered
shuttering Andersen Air Force Base. However, the PRC's military build-
up and expansion has considerably changed the regional security dynamic
and gradually changed threat perceptions in Washington, D.C., and
Honolulu.
The COFA nations potentially offer basing and access locations for
U.S. naval and air Forces and ground forces (Palau, in fact, asked the
US military to establish a base in the country in 2020, but to date the
Americans not taken up the offer). These are essential for purposes of
facilitating operations as well as logistics support, repair and
maintenance activities, intelligence collection, missile defense, etc.
Another serious risk arising from the U.S. having too few bases and
operating locations in the Indo-Pacific is that it is putting a lot
eggs in one basket. All of it vulnerable to the PLA's Strategic Rocket
Force.
The vulnerability of U.S. bases (and ships and aircraft) to Chinese
missiles is a fact of life (and a headache) for American defense
planners. And it is a driving force behind the U.S. military's move
toward a more dispersed presence and `distributed operations' concepts
for the Oceania region.
The U.S. Air Force is adopting a new strategy called `Agile Combat
Employment' and is looking for runways and operating locations in as
many places as possible. Similarly, the U.S. Navy's `Distributed
Maritime Operations' concept aims for something similar--all to provide
a more difficult target for Chinese missiles.
Dispersal--combined with deception and concealment complicates an
enemy's targeting. Even if the PLA Rocket Force has the `range' to hit
out to the second island chain and beyond, it still has to locate the
targets. And even the PRC only has so many missiles.
The FAS provide plenty of opportunity to `spread out' and stay
alive, and hit back on multiple vectors. Just being serious about
setting up in the region and raising the cost to China of an attack
makes it less likely an attack will happen, and in the meantime, the
facilities can be used to build local infrastructure, combat illegal
fishing, assist during humanitarian disasters and more. This is the
essence of deterrence through strength--in a range of sectors.
Military Exercises in the Pacific American Territories and FAS
U.S. forces routinely conduct large-scale exercises on and around
Guam and the CNMI, including with allies and partners. One advantage of
the area is that there is plenty of open space. That allowed, for
example, for the 2020 running of the annual COPE NORTH exercises to
bring together over 100 aircraft and over 2,000 personnel from the U.S.
Air Force, the Japan Air Self-Defense Force, and the Royal Australian
Air Force.
Naval forces regularly train at Guam and the trend is for increased
activity. In 2017, the French Navy made an appearance (with British
Marines embarked) for joint training with the U.S. Navy and Marines and
the Japan Self-Defense Force (JSDF). In July 2020 the Japanese and U.S.
Navies conducted joint drills with the Royal Australian Navy and Air
Force, with U.S. Air Force also participating. The 2023, iteration of
the annual Exercise Sea Dragon saw participation from the Royal
Canadian Air Force, Indian Navy, Japan Maritime Self-Defense Force,
Republic of Korea Navy, and the United States Navy.
The Japanese, in particularly are keen to make more use of Guam and
surrounding areas as training areas for the JSDF. This is owing to
difficulties, mostly self-imposed, in making full use of training
locations in Japan. More permanent facilities in the FAS would make
more essential training and exercises (both unilateral and
multilateral) easier in the FAS easier for both U.S. forces and our
allies (such as the Japanese), as well as bring improved infrastructure
and funding to the FAS, (which, in a complementary manner provides its
own form of security for the people of the FAS). The alternatives are
either to not exercise or to return to the U.S. West Coast or perhaps
Northern Australia to conduct such training.
Other Military Engagements in the Pacific American Territories and FAS
U.S. military exercises and activities elsewhere in the FAS include
regular but generally smaller scale exercises that might be considered
`engagement' more than serious warfighting training.
Small detachments are regularly deployed that conduct useful
engineering and infrastructure development work. In addition to U.S.
Marine teams, these have included the U.S. Navy removing underwater
obstacles to improve harbor access and safety for inter-island cargo
and passenger ships transiting FSM islands. The U.S. Navy's Seabees and
visiting U.S. Army teams have provided infrastructure improvements,
such as building new schools. The U.S. Navy's Pacific Pathways exercise
conducted HA/DR training throughout the Federated States of Micronesia
(FSM).
What's There to Worry about? We Have a `Contract' Agreement, Don't We?
While COFA agreements provide legal grounds for keeping the Chinese
military out of FAS, the risk exists of polarized societies or `PRC-
leaning' governments that permit a civilian but `dual use' PRC
presence. Suppose, for example, a move to allow Chinese monitoring
facilities for `civilian space' or `environmental' or `oceanographic'
monitoring purposes. Each of the FAS is only an election away from
dropping out of America's defense architecture--leaving a gaping hole
and betraying generations on both side who sacrificed so much to keep
it strong,
The U.S. potentially faces something like this with Kiribati--where
the government dumped Taiwan for China in 2019 and moves are currently
afoot to (among other things) allow a Chinese company to refurbish a
decrepit American World War Two airfield on a remote atoll--for
`tourism purposes.' A treaty exists giving the U.S. veto rights should
it be used for military purposes, but enforcing is difficult, and
anyway, the Chinese said it was for tourism, didn't they?
Anyway, if they don't agree, what's the U.S. going to do, send the
Marines to Tarawa again? That's bad optics. To say the least.
Winning Phase Zero
This is why it is so important to pay attention to what is actually
going on in country now (something you can only do properly if you are
there). What goes on in peacetime--so-called `phase zero'--is directly
related to what happens, or doesn't happen once the shooting starts
(so-called `phase one'), and also the success or failure of a conflict.
The discussion of a Pacific conflict with China too often overlooks
what is known as phase zero--the phase we are in now.
`Peacetime' military (or dual use) activities shape the
environment--and ready oneself for a war, or even better, positioning
one's forces and building capabilities (both one's own and allies') to
deter an opponent from `trying something.'
Phase zero military activities include training and exercises,
intelligence collection, contingency planning, setting up or
maintaining basing and logistics facilities--that often requires
diplomacy to ensure partner nation cooperation. Indeed, this is ideally
done with an eye to building partner capabilities and confidence--and
creating new partners who see the you as reliable and likely to
prevail.
The United States has been conducting phase zero operations
throughout the Pacific for over six decades. It has, however, tended to
give relatively little coverage to the COFA nations (and the Southeast
and South Pacific). Most activities tend to focus on Northeast Asia and
Southeast Asia, closer to the Asian mainland.
Meanwhile, if looked at through this lens, it becomes clear China
has been very actively focused on phase one engagement and
entrenchment.
Much of the discussion about China in the Pacific centers on
warfighting considerations and what might happen in a future war with
the PRC. However, to date the PLA's overt activities in the region have
been stayed largely below the `red line', but building the phase one
groundwork.
The PLAN Peace Ark hospital ship makes voyages through the region,
gathering intelligence on the health conditions of key leaders.
There have been humanitarian assistance missions (as seen with the
Tongan volcanic eruption) that gave China insight into local emergency
operations, and gave the excuse to argue for the prepositioning of
supplies.
Although nominally for civilian purposes, Chinese hydrographic
survey ships have mapped huge swathes of Oceania, including in the FAS,
and including the location of undersea cables. And the huge Chinese
fishing fleet is reported by some analysts to conduct signals
intelligence activities (and more) on occasion.
This is a pattern seen worldwide. Chinese military presence tends
to come after a lengthy `set-up' period that includes commercial
inroads, a physical presence of Chinese citizens, diplomacy and
building political ties--especially with key leaders at all levels.
Financial inducements--bribes--are often part of the deal. The military
presence will come along slowly. The PRC's first overseas military base
in Djibouti (which Beijing swore it was not developing) is a textbook
example of this process. In Oceania, the Chinese push and prod in many
places. It is just a question of time before the PLA has a place or two
to call home.
We know it is trying. In 2018 Australian newspapers reported that
the PRC had requested to be allowed to build a military base in
Vanuatu. Both nations denied this. But fears that the PRC might fund
the refurbishment of the Fijian military's Black Rock camp in 2018
caused the Australians and Americans to step in an preempt the Chinese.
Something similar also happened in 2018 when a `private' Chinese
company showed interest in the Manus Island port--a strategically
valuable base during World War II. And in 2019, a Chinese company
signed a contract to develop a port on Tulagi in the Solomon Islands--
across the water from Guadalcanal. After a local outcry--and serious
concerns in Washington and Canberra, the contract was canceled, for the
time being.
In 2019 Solomon Islands switched recognition from Taiwan and a year
later the Prime Minister signed a deal with the PRC that can give the
People's Liberation Army access to Solomon Islands. The same Prime
Minister also took out a US$66 million loan from China to put Huawei
towers all over the country--essentially paying China to wire the
country for the benefit of Chinese intelligence. That's some good work
for phase one.
RECOMMENDATIONS
Be There, In the Right Way, With the Right People
There is something `ephemeral' about much US military engagement in
the Central Pacific. A senior officer drops by for a visit or a
military detachment builds a school and goes home. Key leader
engagements and other official fly-in visits (in particular) from
INDOPACOM in Hawaii and the U.S. Mainland are of limited value compared
to Chinese diplomats, officials, and businessmen (playing the role of
the `Yankee Traders' of old) ingratiating, and aggressively inserting
themselves from top to bottom into local societies.
Besides providing financial benefits locally--Kwajalein in RMI
being a good example--there is the practical and psychological
advantage of `being there.' It is even better when the U.S. military
and `white hull' USCG activities directly benefit the local
governments--as in the case of radar and ocean surveillance systems
planned for Palau. While serving a military purpose, these systems
potentially assist the Palau government to monitor and protect its
ocean territory and resources.
We should expand the US military presence and make it as permanent
as possible, but it needs to be the right people doing the right
things. What's needed in many cases are small units that integrate
locally and that learn from and help the communities. Engineering and
medical units should be in as many places as possible and there is
considerable demand for such services. It's not about rank, it's about
who is best able to build and strengthen the FAS--and our relationship
with them. The right young Captain is better than the wrong Colonel.
The U.S. Marine Corps might establish a training site (or more than
one) to develop its Expeditionary Advance Base Operations (EABO)
scheme. The FAS offers any number of locations, and is in fact the kind
of terrain and setting the EABO concept has in mind.
Make Use of Local Veterans in the COFA States
The extensive network of FAS citizens who are U.S. military
veterans can be enormously valuable in understanding local concerns and
in getting things done and bolstering defenses. A reserve system (under
FAS command) should be considered. It is their country, after all. It
just takes some imagination. One U.S. officer suggested:
The Freely Associated States have a lot of veterans. We should
do a survey. We could harvest retirees to stand up `reserve'
centers immediately then back fill with new recruits. Units
should be anti-surface and surface-to-air batteries.
Need to stand up a `Navy' reserve operating PT boats from their
home islands that are armed to the teeth.
No need for expensive housing and bases, have them operate from
mobile CoCs and allow the reservists to use the boats for
commercial fishing.
No Chinese fishing fleet will mess with heavily armed patrol
fishing boats.
It contains costs, boosts local economy, and create ownership
mentality so they take extra care of the vessel. They won't be
tied up pier side waiting for a Pearl Harbor.
Out fishing will make them harder to target and makes
coordinating a first strike a severe pain.
Defend FAS Waters from Illegal Fishing
Illegal, unreported, unregulated (IUU) fishing is a problem that is
being admired to death.
There are any number of workshops being held to advise the COFA
states of a problem they are well aware of. What they need are both
effective surveillance networks and, as importantly, the means to
actually enforce the laws. Without the ability intercept, search, and
detain it is sort of like watching a shoplifter but not intervening.
Fisheries are the main asset of the COFA states. Look at it as a
matter of national defense. One should consider U.S. military support
to FAS illegal fishing operations as a proper activity relating
directly to these nations' `national defense' for which the U.S. has
responsibility under the Compacts of Free Association. USINDOPACOM
needs to see it as such, especially given the dual use nature of the
PRC fishing fleet. Indeed, this would be a tangible `push back' against
Chinese encroachment and influence--or just plain theft of our allies'
natural resources.
A few ideas for consideration, and keeping in mind that the U.S.
Navy is already hard pressed to cover existing requirements in the
region. The U.S. Coast Guard has only a handful of ships to cover an
area bigger than the continental United States.
Other ideas:
-- Develop a scheme, starting with American territories and the
FAS, where junior U.S. Navy, Marine, or Coast Guard
officers are assigned to implement and carry out an `IUU
prevention scheme'--from surveillance through enforcement.
Have them work with the local enforcement, and provide them
with suitable boats--needn't be `purpose built' government
ships, but are ideally locally built--to cover a designated
stretch of ocean. This can be supplemented by up what
amounts to a local `watchers' network based on local
fishing boats and locals ashore--the Canadian Rangers
(Reserves) model might be worth examining for relevance.
This scheme has the advantage of a permanent presence,
ability to draw on considerable resources, and brings
locals in as partners--thus building up their capabilities.
And it is focused solely on IUU and related maritime
security. This will also require an aerial surveillance
component.
-- Work consistently with regionally appropriate local partners.
For example, in the FAS, bring in the Japan Coast Guard
(JCG) where possible and make this a U.S.-Japanese joint
effort. As Palau and Marshall Islands recognize Taiwan,
work with Taipei there as well.
-- Prioritize the redevelopment of an American fishing fleet and
processing capability, so there is broader incentive to
make sure everyone is playing by the rules, and local
economies are more likely to benefit.
Extend the Financial Parts of COFA
The United States should consider support for the Compact States as
a necessary `maintenance cost' for U.S. national strategic interests.
Consider the COFA value from a military perspective. The cost of
providing ongoing funding and support for the COFA states is a pittance
compared to the expense and difficulty of trying to reestablish a U.S.
presence should it be lost--or to hold it in the face of local
opposition. Indeed, there are other places on earth (and even in the
USA) that are less critical to long-term U.S. interests and where the
U.S. spends more money with even fewer chances of success.
Offer Versions of COFAs to Kiribati, Nauru and Tuvalu
Beijing's prospects received a boost in 2019 when the government of
Kiribati established formal diplomatic relations with the PRC and
severed its state-to-state ties with Taiwan. Kiribati is an independent
nation and without a COFA arrangement with the United States so, in
theory it could permit PLA access to local ports and airfields. China
tends to move surprisingly cautiously when capitalizing on military
access opportunities, but there is some `precedent' in the case of
Kiribati. In the early 2000s the PRC operated a satellite tracking
facility--believed to also have military uses--in Kiribati, prior to
the local government shifting diplomatic recognition to Taiwan. Now, as
mentioned, it is looking at an airfield. There is strong domestic
opposition to the switch to China, but with few economic alternatives,
the case can be hard to make. And the longer China is there, the harder
it will be to extricate. A timely offer of a COFA might be very well
received.
Nauru and Tuvalu, independent countries each with populations of
around 11,000. Both recognize Taiwan and so are under heavy PRC
political warfare attack. Offering them modified versions of Compacts
would show that the United States backs by those willing to take a
stand for democracy and freedom, whatever the costs. Apart from being
the right thing to do, it would fundamentally change the political
warfare narrative about Taiwan--giving hope to many.
Final Note
Sometimes one just doesn't know how good they've got it. Remove the
FAS from `our side' and everything we are doing in the Indo-Pacific
gets very hard--if not impossible. And the FAS are just one piece of
puzzle. Without the FAS states on-side it's hard to `defend forward' or
operate from a forward position along the first island chain. But
you've also got to have the `non-COFA' states secure as well.
You can get the military part just right, and still lose. American
engagement needs to cover economic, commercial, diplomatic, propaganda,
and social aspects in a coordinated way and with same effort. The COFAs
give us the tools to do that, if we want to. Doing it right could mean
ensuring phase zero goes so well, it stays at phase zero.
______
Questions Submitted for the Record to Grant Newsham, Colonel, U.S.
Marine Corps. (Ret.)
Questions Submitted by Representative Westerman
Question 1. How has the People's Republic of China (PRC) been able
to increase its influence in the FAS (Freely Associated States) even
though the U.S. and FAS had COFA agreements since 1986?
Answer. Ultimately, the United States took the FAS for granted--
apparently assuming that since it `had a contract' there was nothing to
worry about. Washington also assumed that all would be well since it
was providing considerable aid to the FAS--direct financial payments as
well as support for education, health care, infrastructure development,
and even postal services and weather forecasting services, as well as
offering the right of FAS citizens to reside in the United States and
providing `military protection'.
The PRC took advantage of American complacency and patiently and
diligently went about establishing and expanding its influence in the
FAS. The Chinese applied a recognizable `sequence'--starting with a
commercial presence that included Chinese nationals on the ground and
operating businesses--and down to the corner shop level. Chinese
economic inroads also included Chinese involvement, and indeed,
outright control of key industries--particularly local fishing
industries--that also are the main economic resources for the FAS
nations.
This commercial presence created political influence--directly with
local officials and other citizens who saw the Chinese presence as a
valuable thing in an economy with limited prospects. It was also
personally valuable for many local officials and politicians. In Palau
the Chinese successfully `weaponized' the tourism industry to both
influence with local officials and others. And this approach has also
been used in the Federated States of Micronesia (FSM) via the offer of
massive investments by Chinese resort companies.
All in all, the Chinese were (and are) seen by many in the FAS as
an economic lifeline. And while the local intention may be to have
Chinese money in addition to American support via the COFA's, the
effect--and the PRC's intentions--are to eventually displace the United
States in the Central Pacific.
Note that FSM recognized the PRC since 1989 (while the Marshall
Islands (RMI) and Palau still recognize Taiwan.) China reportedly pays
the costs of FSM Embassy in Beijing, and hosts visits to China by FSM
officials and other influentials, that include emoluments and
`envelopes of cash.' Chinese under the table payments to officials and
politicians in the other FAS nations are well known. The PRC's aim is
to have RMI and Palau switch recognition, and that objective is
reportedly within sight.
As noted, bribery and under the table payments are part and parcel
of Chinese activities in each FAS nation. There is next to no downside
risk to taking Chinese money owing to scant prospects of such
activities being revealed.
The PRC also reportedly promotes secession movements in FSM--in
Chuuk state. And the recent Rongelap scheme in RMI--looking to set up a
nation within a nation--was carried out by Chinese nationals (with RMI
citizenship) after successfully subverting RMI officials.
China's diplomatic mission in FSM is well-staffed and aggressively
pushing Chinese interests--at American expense. The PRC has made highly
publicized contributions to the FSM `trust fund', built infrastructure
such as roads and government buildings, and it has donated ships and
aircraft (to address the long-standing need for better transportation
between in the country).
Beijing also has a `quasi-diplomatic' presence in Palau and RMI--
and is looking to shift recognition to PRC from Taiwan. And to also
shift local attitudes away from the USA and toward PRC.
The U.S. has been too slow to recognize what has been happening--
even though Chinese influence efforts have been reported--even via U.S.
diplomatic channels. The Americans had (and still have) no political
warfare scheme of their own--so the Chinese have effectively operated
unchallenged.
The U.S. has been unsuccessful in drawing commercial interests into
the FAS in any meaningful way. This, in my opinion, is owing to a lack
of know-how and imagination in U.S. diplomatic and official circles. It
is exacerbated by a failure to work together with partners--such as the
Japanese, Taiwanese, South Koreans, and Indians on commercial and other
broader approaches to bolstering the U.S. and other free-nations'
presence and interests in the region.
One notes as well that the U.S. government has too-often stumbled
on simple matters that include giving FAS leaders and Ambassadors
proper respect. As one example, FAS Ambassadors in Washington are
typically relegated to meeting with `desk officers' rather than State
Department officials of proper rank. Meanwhile, the PRC rolls out the
red carpet for Pacific Island leaders when they visit China.
Chinese influence efforts (aka political warfare) are a phenomenon
throughout the Pacific--and not only in FAS nations.
For further details and background I recommend reading the
following for concise, detailed looks at how the PRC has undercut U.S.
influence in the Central Pacific;
1. Winning Without Fighting/A case study of Chinese political
influence operations in US Territories and the Freely
Associated States in the Western Pacific. (Page: 17-25)
https://csbaonline.org/uploads/documents/Winning_
Without_Fighting_Annex_Final2.pdf
2. This piece by Cleo Paskal in The Diplomat introduces the letters
written by then-FSM president, David Panuelo that highlight
Chinese subversion and influence efforts in the FSM and
beyond. The letters are linked in the text. https://
thediplomat.com/2023/03/micronesias-president-writes-
bombshell-letter-on-chinas-political-warfare/
3. This China Unscripted episode is particularly informative about
Chinese subversion in the FAS. https://www.youtube.com/
watch?v=WCJ8DS6EDEU
Question 2. How would renewing the COFA help counter Chinese
influence if it hasn't kept the PRC from increasing its influence?
Answer. Were it not for the COFA--and the fundamental loyalty and
affinity to the United States on the part of the residents in the FAS
nations--the Chinese would already have control over the FAS nations
and the Central Pacific.
The problem isn't the COFAs. It is the lack of additional proper
attention and effort by the United States--to include the State
Department and the Department of Defense in particular. The Trump
Administration was the first administration to actually devote time and
effort to the FAS (and the rest of the Pacific Islands), but it did not
have enough time to fully implement their `campaign plan.'
The FAS do notice when the United States hems and haws over
renewing the COFAs and appropriating necessary funding. This gives the
impression--rightly or wrongly--that the FAS nations are not considered
all that important. Impressions and psychology matter a lot.
The COFA's are best viewed as maintenance fee and a foundation for
the U.S. presence in the Central Pacific--and the right to exclude
foreign militaries from the FAS territories. But it is essential to
ensure that requirements beyond the COFA payments and other current
assistance are met.
As described in Question #1, developing and implementing a joint
scheme for the FAS with our partners in Japan, South Korea, Taiwan,
India, and perhaps Australia would make our efforts in the FAS far more
effective than just the U.S. acting alone. It can also help address the
need for commercial development that is lagging--and that is dominated
by Chinese interests.
Beyond the `treaty' aspect of the COFA relationship, the U.S. needs
to ensure proper respect and appreciation for the FAS nations is
demonstrated and articulated.
As mentioned earlier, the expansion of Chinese influence is not the
fault of the COFA agreements. The bigger problem is that the U.S.
thought the COFA treaties alone were enough to ensure our presence and
interests were guaranteed. We needed to do more. As one data point,
U.S. embassies in the FAS are generally tiny and somewhat sleepy
operations--and service in the FAS is not highly sought by American
foreign service officers.
The Chinese have been operating without any real American pushback
for decades. In other words, the American have been remiss and have
allowed Chinese influence to expand and take hold almost by default. As
noted, it's amazing they haven't got the entire place locked up by now.
Read then-president Panuelo's letters and you'll shiver at how close
they have gotten to their objective.
The majority of FAS citizens want nothing to do with the PRC. But
they want, indeed they need, the Americans to `step up' and demonstrate
their reputed commitment to the region.
The USG needs to realize what is at stake and quickly develop and
implement a proper campaign plan to bolster our presence and position
and to take on Chinese influence efforts--to include the PRC's highly
effective use of under the table financial and other corrupt methods of
establishing Beijing's influence. This needs to be exposed--and U.S.
intelligence and law enforcement resources need to be deployed at
proper scale.
Finally, the amounts of money needed to renew the COFA deals is a
pittance. It's roughly $300 million a year for seven years. That is
literally a day's worth of Medicaid and Medicare fraud. The costs of
having to properly defend or having to occupy the FAS to forestall
Chinese influence? Maybe start at $100 billion--yes, $100 billion. And
that is not considering the costs of having to actually fight.
Just to get started on the calculation, we will need at least 20
new U.S. Navy ships. That's close to $40 billion alone. Add in
additional aircraft to cover the FAS region (an area the size of the
USA), facilities to handle and operate the new hardware, and additional
personnel to man the ships and aircraft (if you can find them) . . .
and we're getting close to $50 billion just in one-time, up-front
costs.
And having to become an occupying power in a region where we were
once welcomed and liked has a `cost' of its own. That cost alone may be
hard to precisely quantify, but it if Beijing were to put a price on
the political warfare `win' for the CCP it would make $300 million seem
like peanuts.
If a fight is required to keep the Central Pacific in American
hands, the costs will be astronomical--as we saw in Afghanistan and
Iraq.
______
Mrs. Radewagen. I thank the witness for their testimony.
The Chair will now recognize Members for 5 minutes for
questions. I will start by recognizing myself. This question is
for all witnesses.
It is very clear how the non-expiring security provisions
of COFA support U.S. interests and protects us from our
adversaries. However, it is not as clear as to how the economic
provisions play a role in this.
Furthermore, China has attempted to undermine the United
States by offering more money and cheap infrastructure. How
exactly does U.S. economic assistance to FAS under the COFA
support U.S. interests and counters PRC influence?
And what keeps the FAS from accepting Chinese economic
assistance?
Mr. Short?
Mr. Short. The economic assistance that we provide under
the Compacts of Free Association is primarily focused on
development. That is, education, health, and infrastructure,
and other related activities. There are also U.S. Federal
programs that provide assistance to these governments.
The PRC's activities generally revolve around large
infrastructure projects, high-visibility projects, and they
have had a checkered track record on these projects. For
example, the buildings in the Federated States of Micronesia
that literally fell down had to be rebuilt.
But this does present a challenge, because we cannot
respond directly, one for one, in a bidding war with the PRC. I
think the underlying relationship that we have, this people-to-
people, government-to-government relationship, this is a tie
that binds. It is a 40-year relationship. And, let's face it,
Compacts of Free Association, in the various iterations, have
worked very well. Free association has been a direct benefit to
the United States, as we have pointed out, in the security area
and others. It has also been a direct benefit in developing
self-government and democracy in these islands.
The challenge going forward is that the PRC doesn't play by
the rules, and we have to be doubly aware of the threat
economically, politically, and otherwise that they pose to
small islands. Let's face it, the small island governments are
remote, they are fragile. They have very limited natural
resources, with the exception of fish. So, they are vulnerable.
A good example is Palau, where the Chinese PRC built up
tourism from the PRC to Palau. Then, when Palau didn't kowtow
to the PRC on the Taiwan issue, they invented a health issue
and tourism stopped. Well, it crashed the Palau tourism
economy. This is a good example of how the PRC uses, basically,
a multi-faceted approach to gain their objectives. That is
political, economic, social, you name it. It is all in the
basket. Thank you.
Mrs. Radewagen. Yes. Dr. Lum?
Dr. Lum. Yes, the Freely Associated States, Micronesia in
particular, will accept foreign assistance, whether it is from
Australia, Japan, China.
Ideologically, they are much more aligned with the United
States, culturally.
There are various areas where we are not competing head to
head with China, but health care, education. China has started
to provide climate-related assistance in the region, but that
is one area that we could build goodwill.
Palau is doing a little bit better economically, but there
are areas, such as tourism and fishing, that we should bolster.
And, of course, through the Compact assistance. Thank you.
Mrs. Radewagen. Yes. Ms. Paskal?
Ms. Paskal. Chair Radewagen, the question of why Palau
didn't flip after all that pressure was put on is incredibly
important. They understand the threat that they are facing, and
they don't want to be pulled into that Chinese orbit. They are
very overt about it.
The problem is that China is not democratic. All it needs
to do is capture an elite of a dozen or so, like it did in the
Solomons, to flip the country. So, understanding how brave they
are and the risk that they are taking by not flipping to China
in the case of Palau, even though that pressure was put on,
shows the incredible determination, sophistication, and courage
of the people of the FAS. But it also shows how vulnerable it
is if they pull a Solomons and find the right dozen people to
buy off, and then all of this falls apart. Forget strategic
denial, forget being able to base.
Mrs. Radewagen. Thank you, Ms. Paskal. I am out of time, so
the Chair now recognizes Mr. Case for 5 minutes.
Mr. Case. Thank you, Madam Chair, and thank you for the
accommodation, and thank you to our great witnesses. I think
you have painted the picture very well.
I think, Mr. Short, yesterday we had a very good discussion
among the Ambassadors from the various countries of the
Pacific, including the Freely Associated States, through our
Pacific Islands Caucus, in conjunction with Australia and New
Zealand. And one of the issues we have is we view this very
much in a defense-related perspective because we have the
geopolitical challenge of China and we recognize it. We have
identified China as our top geopolitical challenge.
We, whether we are at Natural Resources or Appropriations
or Armed Services, need to consider these areas of the Pacific
in a defense perspective, and yet the Pacific Islands don't
want us to just look at this as a defense-related issue for the
United States. They have their needs. They have their concerns.
They deal with climate change on an existential basis. They
deal with economic disadvantage. They deal with social safety
nets.
I think my question is, and I am trying to sort this
through, how do we talk about both of these concerns and areas
in a way that is relevant to them, responds to their concerns,
but is realistic about the world that we are living in, and
about the fact that the Pacific Islands is part of this
geopolitical challenge?
Mr. Short. You have hit on a very important point. On one
hand, you have the sovereign state, the Micronesian state. On
the other hand, you have the U.S. Government and the
Administration providing financial and other supports. So,
there is almost a built-in conflict.
On one hand, the Micronesians rightfully can say, ``We are
sovereign, we are administering our own internal affairs, our
own foreign affairs. You are responsible for our security and
defense. We are members of the United Nations, send us a
check.'' And that is what was done in the first Compact.
Unfortunately, it didn't work out too well. The emphasis that
we hoped would take place on education, health, infrastructure,
economic development didn't take place.
When I renegotiated the Compacts in 2003, I instituted an
agreement called the Fiscal Procedures Agreement, which held
the Micronesian states to the same level of accountability that
we, the Federal Government, holds state and local governments.
And we felt that was a fair balance between, on one hand, the
sovereign responsibilities and prerogatives of the Freely
Associated States, but on the other hand this is appropriated
funds, and there has to be accountability.
The mechanism I feel, looking at it from the outside, has
worked reasonably well. It has been administered by the Office
of Territorial Affairs in the Department of the Interior. And I
feel that an agreement is a piece of paper, but it is the
relationships that we build with the staffs here and with the
governments there that has made it effective. And we have tried
to emphasize education, health, and infrastructure. Is it
perfect? No, but it is sure a lot better than what we did
before, and I think it sets parameters for future engagement.
Mr. Case. Great, thank you.
And Mr. Newsham, I can't ignore you since you are my
constituent. Welcome. I am really happy to have you on the
panel. But what other countries are our partners in the Freely
Associated States, in particular?
Of course, the United States, special relationship going
back to the trust territories. But countries like Japan, Korea,
Australia, these are partners in the Freely Associated States,
from a strategic perspective to an economic assistance
perspective and beyond. And what may we be missing here that we
need to focus on?
Mr. Newsham. Thank you, sir. Well, I think we are not
taking full advantage of our partners.
The Japanese have a very strong interest in the region in
particular, and they know how to operate in this place, and
they have financial resources, they have people on the ground.
And they do their thing, and we sort of cooperate a bit. But
what is needed is a fully coordinated strategy between the
United States and the Japanese. Bring the South Koreans in it,
get the Taiwanese in it as we can, and look at it from that
perspective, not each side doing whatever it feels like. And
that has been a fundamental failing.
And one other point I just want to bring up, sir, is you
correctly identified this tension between the economic and the
security, and it is almost regarded by many people as if they
are two different things. The idea is, well, we have a
contract, they have to let us in, they have to allow us to keep
people out. Well, not necessarily. Security rights are
dependent on us ensuring the economic well-being of the Compact
states, and that is often not recognized. There is actually
language in the Compacts that addresses this clearly.
Mr. Case. OK, thank you so much. My time is up, as well,
but I appreciate that final point. Aloha.
Mrs. Radewagen. The Chair now recognizes Mr. Tiffany for 5
minutes.
Mr. Tiffany. Thank you, Madam Chair.
Ms. Paskal, you highlighted in your testimony the former
FSM President's letter. And how has this situation evolved
since the release of that letter?
Ms. Paskal. Thank you. So, when that letter was leaked,
because it was actually designed to go just to internal
leadership in the country, he had already effectively lost re-
election.
This was the third of three letters. So, some will say
that, well, he did it because he lost the election. But while
he was in power he wrote two others, one to Prime Minister
Sogavare of Solomon Islands about how concerned he was about
the security deal signed with China, and one when Wang Yi went
through the region to try to sign deals with others. I would
suspect that that would have made him a very serious target for
Chinese political warfare to ensure that he wasn't re-elected.
He, in that letter, put the most incredible blocking offer
on the table, which was to de-recognize China and recognize
Taiwan. He was in power during the transition period for a few
months. And if the United States would have backed that
proposal, it would have completely changed the strategic
dynamic of the middle of the Pacific. You would have had the
three Freely Associated States all recognizing Taiwan. It would
have been incredibly operationally important. You could have
had the Taiwanese navy running through it, as well.
That didn't happen, he is out of power. And now,
undoubtedly, the Chinese are going to try to make his life as
miserable as possible so that nobody else tries that again.
Mr. Tiffany. So, why did that fail? Why did they fail? Why
did we in America fail?
Ms. Paskal. I would ask the State Department.
Mr. Tiffany. What year was that?
Ms. Paskal. The letter came out March 9, 2023. He was in
power until, I think, May 11, 2023. So, that was the window
that you had. And he was willing to take the hit to recognize
Taiwan.
The Taiwanese can't move without the U.S. approval.
Taiwanese were interested. They had negotiated. And in the
letter, he detailed the amounts of money he had talked to the
Taiwanese about, what they would need in order to pull away
from China, because China would have pulled all their money
out. So, in order for the economy not to crash, they needed a
very minimal amount, like $50 million over 3 years, something
like that.
Mr. Tiffany. And the opportunity has now passed?
Ms. Paskal. Yes, that opportunity has passed. But when
China loses a country, when a country goes to Taiwan, the
Chinese stay in the country and fight to get it to flip back.
When a country flips to China, we don't fight. We have kind of
given up on Solomons or Kiribati, but there is opposition in
both Solomons and Kiribati who wants to go back to Taiwan.
Mr. Tiffany. Mr. Newsham, is that what you were driving at?
I just jotted a note. I just said, ``Are you saying we are not
showing up'', when I was listening to your testimony, is that
what you are talking about?
Mr. Newsham. Well, that is certainly part of it, sir, is
that we don't have enough of a presence. I would cite that the
embassies that we have in the region, and not where we should.
It is not as if diplomats are lining up to get those
assignments. There are not enough of them. We are not on the
ground, as we need to be. And that is one of the issues I am
getting at, that an offer like this comes along, and well, we
almost don't have the players on the field to deal with it.
Mr. Tiffany. Was it you, Mr. Newsham, that said the Chinese
do not play by the rules, the Chinese Communist Government does
not play by the rules? Did you say that?
Mr. Newsham. I don't think I said it, but I would have said
it.
Mr. Tiffany. Yes, OK. So, how do you react when, as a
country that believes in the rule of law, how do we operate,
then, when we are up against an adversary that does not want to
play by the rules? What do you recommend? Showing up?
Mr. Newsham. Well, that is a good thing to do, for
starters.
And keep in mind that, in the COFA states and throughout
the Pacific, the Americans are actually very well liked. People
want us to be there. But you do have to have diplomats on the
ground. You have to have a military presence. You have to have
a commercial presence, as well. And that is where people like
the Japanese, the Taiwanese, the Indians can be very useful.
But all of this has to be combined in a systematic
political warfare campaign, and we have forgotten how to do
political warfare some time in the 1980s. And what the Chinese
are doing is political warfare. Much of it is greased by these
under-the-table payments, and it is very effective because it
doesn't get exposed.
We should pay some intelligence attention to the region and
expose this stuff, give the honest people in these states the
ammunition to go after what the Chinese are doing. Let them do
it, but give them the resources. But we have to have some sort
of a campaign plan to do this. But as it is, it is sort of a
very, very modest, sparse, haphazard approach to things too
often.
Mr. Tiffany. Madam Chair, unfortunately, my time is up.
But if you would be willing to share with my office, I just
find it very intriguing when you talk about we forgot how to do
political warfare in the 1980s. If you would care to send a
summary document on what you are referencing to my office, I
would really appreciate it, because I could be asking a whole
lot more questions.
But I yield back.
Mrs. Radewagen. The Chair now recognizes Mr. Gallego for 5
minutes.
Mr. Gallego. Thank you, Chair Radewagen and co-Chair
Sablan. And thank you to our witnesses for your insight today.
As a member of both the Natural Resources Committee and the
Armed Services Committees, I am glad that we are having this
important conversation about the crossroads between national
security, our natural resources, and relationships in the Indo-
Pacific Region. And I did take a CODEL with a couple of Members
here as past Chairman of Intel Special Operations, in
particular, to talk some of our friends out there. And what I
am hearing from you is what I heard from the President of
Palau, the Prime Minister of Papua New Guinea, and a couple
other allies and friends.
Mr. Newsham, please elaborate on your idea that the United
States should consider support for the COFA states as a
necessary maintenance of cost for U.S. national strategic
interests.
Mr. Newsham. Yes, sir. One way to look at this is to
consider what would it cost us to secure that region if one or
more states told America, ``Look, you haven't done what you
said you would. The Chinese are offering us a ton of money. We
renounce the treaties.''
What you would have to do is you would have to get a much
bigger navy. You would have to have a lot more ships to cover
this. You would have to, literally, send in the Marines. You
would have America as an occupying force in this region, like
we did in the Caribbean in the 1920s. And that costs a ton of
money. The amounts that are being talked about in the COFA
negotiations, goodness, we were spending $45 billion a year on
Afghanistan.
Mr. Gallego. What is the amount that they are asking, that
they are talking about in COFA?
Mr. Newsham. About $7.1 billion over some period of time.
Mr. Gallego. Right. As someone that served on the Armed
Services Committee, that is just a rounding error, which is
amazingly sad.
Can you also elaborate on your statement that the ability
of U.S. forces to operate between the corridor from Hawaii to
Guam free of enemy interference is indispensable? I think you
kind of already talked a little bit about it.
Mr. Newsham. Yes, sir. As a worst case, if you had the
People's Liberation Army set up in those islands, it would
effectively be an A2/AD area, anti-access area denial zone,
that you would, at best, tread carefully. At worst, you would
steer clear of it.
And it is hard for us to imagine, because we have taken
this access for granted. But you could even have it done by the
Chinese very efficiently with their maritime militia doing it.
So, you literally would fight your way through the region.
Mr. Gallego. Right. And the goal of China is to make sure
that they keep enough distance from us being able to get as
close to them as possible, so that we can effectively use our
air superiority to potentially protect Taiwan or suppress their
abilities to cross the Straits of China. So, the further we
have to fly, the harder it is for us to be able to coordinate,
refuel, and essentially assert any type of control over the
shipping lanes. Is that correct?
Mr. Newsham. That is exactly it, sir.
Mr. Gallego. And I think it was Ms. Paskal, or maybe it was
Mr. Short or Dr. Lum, we talked about the State Department in
terms of diplomats. And this is actually something that I heard
also in Papua New Guinea, where they, No. 1, they said,
``Please stop using the Australians as your proxies and treat
us as you would treat any other country.'' And also that China
is opening up embassies on individual island nations, and we
are not.
So, (1) have you seen any shifts, we will go with Dr. Lum
first, then Ms. Paskal, if you can answer that. Have you seen a
shift? Are we actually starting to open up embassies?
And (2) how can we make this an attractive posting for
diplomats? I mean, this is extremely important. This is going
to be essentially what many, I think, diplomats had to deal
with in terms of Eastern Europe during the Cold War. What can
we do to attract that very young but capable diplomat to go
take that post in Palau, for example?
Dr. Lum, do you want to start?
Dr. Lum. Oh, sure. So, the State Department has recently
opened two more embassies in the region, which are in the
Solomon Islands and Tonga.
Mr. Gallego. Great.
Dr. Lum. Then it plans to open two more in Vanuatu and
Kiribati. So, that covers most of the countries, but not all of
them. I would say, compared to China, I think we are finally
about on the same level. China also appointed a Special Envoy
to the Pacific Islands Forum, and then we are in that process.
Mr. Gallego. That is great. So, there is movement there.
OK.
Dr. Lum. In terms of your second question, I have heard
anecdotally it is a hardship post type of situation, but that
is something to think about, in terms of making the position
more attractive.
Mr. Gallego. Yes.
Ms. Paskal?
Ms. Paskal. Yes, you have opened two new embassies. Neither
of them have consular services, and they are very small
staffed. The one in Tonga was opened when both the King and the
Prime Minister were out of the country, which was a bit of a
diplomatic faux pas, and quite confusing.
This Task Force helps people want to be posted there. The
attention to the area is incredibly important.
The other thing about this Task Force, which goes to
Representative Case's question, is the FAS and the American
Pacific Island countries are different than the other Pacific
Island countries. They shouldn't be thought of in the same
sense. The FAS know their defense and security relationship.
They are active Chinese targets. So, thinking of them as
disaggregated is what is very important about this Task Force.
You don't have to deal with all the Pacific Islands. In fact,
you are not supposed to. You can just deal with the FAS and the
territories, and put that together.
The other thing about zoning is that China is also trying
to get to Latin America, where they are building up a lot of
facilities, which you know. They need to go through the Pacific
Islands for that. So, it is not going to just stay up in the
FAS, it is going all the way through, which is why American
Samoa is such an important component that really needs more
attention.
Mrs. Radewagen. Yes.
Mr. Gallego. Thank you.
Thank you, Madam Chair.
Mrs. Radewagen. The Chair now recognizes Mr. Moylan for 5
minutes.
Mr. Moylan. Thank you, Madam Chair.
Colonel Newsham, alongside other members of the Pacific
Island Caucus, I requested an increase in appropriations in
support of diplomacy in the Pacific. These requests included
increased appropriations for State Department staffing in the
Pacific, USAID's Pacific America Fund, natural disaster relief,
and humanitarian assistance. Colonel, can you speak to the
importance of increasing America's diplomatic and humanitarian
presence in the Pacific?
Mr. Newsham. Yes, sir. If we are not there, we have almost
no ability to shape the region, shape events, shape what people
think.
And as I noted, people want us there. It is not like us
trying to turn Afghanistan into a liberal democracy. We are
wanted in the Pacific, and you have to be there.
The humanitarian assistance/disaster relief part of this,
this is a very good opportunity for us. One, it serves a
practical need, it addresses real problems. There are disasters
that happen all the time. But it also allows you to set up the
infrastructure that we need that is useful from a security
standpoint. It allows you to bring in your allies and get them
working.
But also, you can really bring in the locals. And I
mentioned sort of a local defense force. Getting the islanders
directly involved in their own defense, there are a lot of
veterans that you can use as the basis for this.
But these are two very good opportunities, and you have to
make it attractive to the people that will do it. And they are
human beings, and if you make it clear that, ``If you go out to
the Pacific, this is the hot area, this is where your career is
going to take off.'' But as it is now, everyone wants to go to
Vienna, but not so much the Pacific. That has to change, and it
should change.
Mr. Moylan. Thank you, Colonel.
Colonel Short, the continuation of COFA agreements is
important to the U.S. strategy and strategic interests. This
also means there will be continued migration to the United
States. Colonel, do you anticipate an increase in COFA migrants
coming into the country, and what impact does COFA migration
have on the United States?
Mr. Short. I think your concern is the United States
increasing military presence in the area?
Mr. Moylan. Actually, no, Colonel. We are talking about the
COFA agreement will allow COFA migrants to come to the United
States. Your input on this, how does it come into the country,
and what impact COFA migration has on the United States.
Mr. Short. Oh, migration. OK. Going back to the whole issue
of migration of Micronesian citizens to the United States, in
the initial Compact we provided for visa-free entry of
Micronesian citizens to the United States, and they can work
and stay as long as they want. It is not a path to citizenship.
And this was really made under the assumption that population
increases were so great in the islands, and the land mass
wasn't expanding, that there was simply going to be an over-
population situation.
That immigration facility was continued in the second
Compact, and I assume it is going to be continued in the third.
And it has resulted in impact specifically on the U.S.
territories, but also on Hawaii and in the United States.
When I renegotiated the Compacts, we made provisions for
what was called impact on the U.S. territories, including Guam,
Northern Marianas, American Samoa, and Hawaii, not the
continental United States. Those funds were increased by the
Congress, and they are administered through the Department of
the Interior to basically ameliorate the impact of this
migration. It has been most pronounced, for example, in Hawaii
and Guam.
I am not sure exactly how it is going to be addressed in
the Compact that you will be receiving shortly, but it is
something to look at and assess, the effectiveness of the
program over the last 20 years, and how it should be fine-tuned
or continued.
Mr. Moylan. Thank you very much.
Madam Chair, I am pretty much out of time, but I appreciate
it. Thank you to the panel.
Mrs. Radewagen. The Chair now recognizes Mr. Grijalva for 5
minutes.
Mr. Grijalva. Thank you, Madam Chair.
Ms. Paskal, the COFA agreements, approving the renewal of
those Compacts with FASs in a timely manner, it is not a
question in terms of the urgency that we have before us in that
underlying discussion on those agreements, that both deal with
military security, economic security, underlining those
discussions, at least with representatives from Freely
Associated States, has been the issue of respect. Can you speak
to that in terms of how that is an underlining issue?
Ms. Paskal. That is a very serious issue. And I think the
nuclear issue kind of encapsulates it, where the United States
conducted 67 nuclear tests in the Marshall Islands, and the
Marshallese were well aware of the sacrifice that they were
making for American security, but also global security.
And the way that this renewal has been framed, where this
kind of $700 million of undivided money that is not really
dedicated to nuclear, there is no apology, is, I think,
perceived as a lack of respect for what they have had to go
through. Also, frankly, a lack of gratitude for what they have
sacrificed.
Whereas, if you flipped it on its head, and acknowledged
it, and dealt with it up front, it is a bonding relationship of
mutual sacrifice for the sake of freedom and liberty that could
then be built upon in the current context to figure out how we
are going to work together again.
Mr. Grijalva. Yes, which speaks to the issue of a timely
agreement.
Dr. Lum, the Pacific Islands have identified climate change
as an urgent concern for their security and their overall
development. How may a failure to deal and mitigate climate
change impacts on the Pacific impact the U.S. relationship with
these islands, going forward?
Dr. Lum. How does addressing climate change impact our
relationship with----
Mr. Grijalva. Or not. Or the failure to address that
mitigation, the failure to work with the very important issues
of loss of land, loss of climate. The change.
Dr. Lum. The Freely Associated States are among the low-
lying island and atoll countries in the region, and they are
directly threatened by rising sea levels.
Regionally, the Pacific Islands Forum came out with the Boe
Declaration, they consider climate change as a type of security
threat. So, they see climate change, along with the traditional
security threats that we have been discussing today, as a very
big issue.
Mr. Grijalva. As does the military, our military sees that
in that region, as well.
Dr. Lum. And it also involves this notion of respect that
we have just been discussing. So, listening to the Pacific
Island countries about climate change, even if it is just
listening, along with the other issues, I think that does go a
long way.
Mr. Grijalva. Thank you.
And Mr. Newsham, how do the provisions of economic support
and climate change mitigation to the FAS and other Pacific
Islands serve the specific security interests that the United
States has in the region, and needs to secure even further in
the region?
Mr. Newsham. It is as I noted earlier, sir, they are
directly related. You can't distinguish the two, in my opinion.
The economic well-being of the Freely Associated States, it
creates the political conditions which allow the security parts
of the Compact to exist.
This relationship that the Freely Associated States has
with the United States is unprecedented. I think it is the only
three countries on Earth that have given up their sovereignty
and control of a part of their government to the United States.
And that is a huge sort of act of trust. And there is an
obligation, I think, which it creates. And I would say this is
not just to defend, but it is also the economic well-being.
And yes, it is a challenge, given the nature of the Freely
Associated States, but it is not insurmountable. There are
plenty of things that can be done.
And once again, working with our partners, the Japanese,
the Indians, Taiwanese, there are lots of opportunity there
that provides an alternative to these blank checks that the
Chinese are offering.
Mr. Grijalva. Thank you, Madam Chair. I yield back.
Mrs. Radewagen. The Chair now recognizes Chairwoman Hageman
for 5 minutes.
Ms. Hageman. Thank you and thank you to the witnesses for
being here.
Colonel Newsham, in your testimony you pay a lot of
attention to the strategic positioning of the FAS, and you
reference how the island nations make up the rear of our
deterrence posture in the first island chain, and how they make
up the power projection superhighway.
The PRC has developed A2/AD capabilities on the other side
of the first island chain to protect its homeland. If the
United States lost exclusive military rights among the FAS, and
China gained a military foothold, what would the deployment of
its A2/AD capabilities mean for freedom of movement and
projection of our own military forces?
Mr. Newsham. Once again, ma'am, the map tells you a lot.
These Freely Associated States, they are an area as big as the
United States. And with the Chinese ensconced there with long-
range precision weapons, it would create a huge zone that you
would have to either go around or deal with. You might have to
fight your way through, once again.
And as was mentioned earlier, it is important to note also
that the Chinese see this as a springboard to the East, and
they are setting up the dual-use, potentially military
infrastructure in Latin America. They have brought successive
administrations, regimes onto their side. And one day the PLA
will be operating in Latin America and off the U.S. West Coast.
They are going east, actually, at the same time.
But it is hard to overstate just what problems this would
cause.
Ms. Hageman. Well, it sounds like we would have serious
economic and trade impacts for the United States, because this
is such an important region for the world.
Is it safe to say that this breakdown in the second island
chain would do enough damage to our forward-deployed deterrence
that the PRC would be on a path to achieving regional dominance
to serve as a base for global power projection?
Mr. Newsham. Yes.
Ms. Hageman. OK. Dr. Lum, Taiwan is a significant piece of
the first island chain, and China is looking for openings and
opportunities to break through that first island chain. We have
rightfully discussed here how military action is not the only
mechanism in which this can be achieved, but through other
tactics like political warfare, as you mentioned just a moment
ago, Colonel, economic influence, trade war tactics, espionage,
and more.
Palau and the Marshall Islands give diplomatic recognition
to Taiwan. Micronesia rejected a PRC-proposed pact with 10
Pacific Island nations, which caused the PRC to shelve that
particular plan.
We have strong allies in the Freely Associated States, and
this Congress must recognize the mutual benefit in this
agreement. Yet, as you testified, the PRC's influence in the
region is most likely growing.
Dr. Lum, in your written testimony, you included a map of
the Pacific Islands and the Southwest Pacific subregions. We
can see that in the Micronesia subregion are all three of the
Freely Associated States, as well as some of our territories.
And in this subregion and the Melanesia subregion, which
borders it, is Kiribati and the Solomon Islands. Can you detail
for us some recent developments with these two island nations
when it pertains to growing Chinese influence?
Dr. Lum. Are you referring to Kiribati?
Ms. Hageman. Yes.
Dr. Lum. What was the other country?
Ms. Hageman. Solomon Islands.
Dr. Lum. Solomon, OK. And Ms. Paskal could also talk about
the Solomon Islands.
For Kiribati, I would say, and then maybe I will defer to
Ms. Paskal. For Kiribati, it is an interesting case. There is
an airfield that China is helping to build or upgrade. Kiribati
is also an interesting case because it has switched back and
forth, recognized China, and there was a sort of military
installation back in the early 2000s, and it went to Taiwan,
and then switched back to China. So, it shows how easy it could
be for some countries to go back and forth without a lot of
consequences.
Ms. Hageman. Instability and volatility, it sounds like.
Dr. Lum. Yes.
Ms. Hageman. Ms. Paskal, if you could, speak on the Solomon
Islands.
Ms. Paskal. Yes, sure. In both cases what you see China do
when it goes into a country is they have a term called the
Three Warfares. So, they go after these, the institutions that
enable democracy to happen. They go after the media, and you
can see them doing that in places like the Solomons, where
there are articles coming out about how somebody who still
supports Taiwan actually met up with the Americans in Taiwan to
put together a hit squad to kill the prime minister.
It is completely fallacious, but they are setting up a case
for the second thing, which is lawfare, which is to put their
political opponents in power. And in Kiribati, what you saw,
one of the first things they did when they switched, was they
went after the independent judiciary. So, now they have the
attorney general being chief justice, I think.
And then the third is psychological warfare, which is they
instill fear in the population to make sure that they don't try
to counter. So, you are seeing a fundamental transformation in
both Solomons and Kiribati of the nature of the society from a
free, democratic, open society to increasingly authoritarian
and, effectively, a metastasization of the CCP system, a Hong
Kongization of those islands very, very quickly. They started
in 2019, and they have gotten very far, very fast.
Ms. Hageman. OK, that is extremely helpful information. I
am out of time, but I appreciate you explaining those points.
Thank you.
Mrs. Radewagen. The Chair now recognizes Ms. Stansbury for
5 minutes.
Ms. Stansbury. Good morning, everyone, and thank you, Madam
Chair. Thank you to our Ranking Member, as well.
I am truly honored to be able to serve on this bipartisan
Committee with my colleagues, and I want to thank all of our
witnesses for being here today. I think the role of this
Committee in highlighting how essential our continued
engagement with the Freely Associated States is obviously not
only important for our national security and economic interests
in the Pacific, but also global security, and that is why we
are here.
The Freely Associated States and their citizens have, as we
have discussed, played a crucial role in the strategic
interests of the United States and its allies for the last 30
years. But they are also our friends and our colleagues, and we
are grateful, of course, for our association.
As we have heard this morning, China has made a concerted
effort to undermine the U.S.' long-standing economic and
security relationships with these entities, and it is
imperative that we renew our Compacts with the Freely
Associated States and continue to hold the line with respect to
Chinese aggression in the Pacific.
For those who are watching at home, I want to take a moment
to talk about why I am serving on this very important Committee
and alongside my sister from New Mexico. Some may be asking why
two Members from New Mexico are interested in the South Pacific
and the Compacts of Free Association. And that is in part
because many of our constituents back home play a vital role in
national security, from the airmen and women who serve at
Kirtland Air Force Base in my district to the scientists at our
national labs who help to support these missions and our proud
service members across New Mexico, of which we have many,
including my own partner, who is a proud veteran and Marine who
served in the Pacific. So, these issues are very important not
only to our strategic interests as a country, but also to the
people of New Mexico and our continued commitments in the area,
as well as the safety of our service members.
And I want to thank you, Colonel, for your service and for
being here with us today.
I think that a lot has been covered already this morning
with regards to some of the aggressions and activities that are
happening. But Dr. Lum, I wonder if we could sort of zoom out
the discussion a little bit and help contextualize what exactly
is going on in the Pacific. I know that my colleague, Mr.
Gallego, touched a bit on this in his questions, but what is
the end goal of the Chinese Government?
Why are we seeing this expanded influence in the Pacific,
and why is it a threat to U.S. interests and to the safety of
the Freely Associated States?
Dr. Lum. Thank you. I can give some responses and then
maybe defer to my fellow panelists.
One, China always hopes to gain support in the United
Nations on votes. So, that is one area. It doesn't have to even
cover the security arena, it is just support in global
organizations. When it gives money to a country, whether it is
in the Pacific or Latin America, it often receives support in
the United Nations or other global organizations.
In the security area, of course, we were talking in the
first and second island chains and being able to, in a Taiwan
contingency, achieve its military goals.
China also has economic interests, like mining in Papua New
Guinea. China needs a place to put its excess capacity when its
own companies in China don't have anything left to build. So,
it sends those abroad.
So, those are some of the goals that China is attempting to
achieve in the Pacific Islands.
Ms. Stansbury. Thank you, Doctor. That is extremely
helpful.
And Colonel Newsham, I will put the question to you with a
follow-up question, given your background and experience with
the Marines and serving in our armed services. What do you feel
like are the most significant things that Congress can do to
help support our military presence in the area, and
strategically to help support the Freely Associated States?
Mr. Newsham. I think in the immediate term, ma'am, in the
Freely Associated States, as I said, small units, engineering
units, medical detachments, put in there for some extended
period of time, and you keep replacing them. This permanent
presence, show that you are there and that you are interested.
And also, as I said, create something along the lines of a
local defense force, so that you are not just there doing all
the work, but have the locals brought into this, as well. That
would be something I really would stress. And there are a lot
of good, young officers who want to be in these places using
their initiative away from the headquarters. And a lot of good
things happen once you are there and you leave things up to the
young captains, and that is something that should be done,
wouldn't cost much in terms of money or manpower.
Ms. Stansbury. And I think your comments also point to one
of the benefits of our Compacts, which is the opportunity for
those residents of our Freely Associated States to serve in the
U.S. military, as well. So, I appreciate that.
I realize I am out of time. I have many, many questions.
But Madam Chair, I really appreciate the opportunity to serve
on this Committee and for your leadership. Thank you.
Mrs. Radewagen. The Chair now recognizes Mr. Wittman for 5
minutes.
Mr. Wittman. Well, thank you, Madam Chairwoman. I
appreciate our witnesses for joining us today.
I wanted to sort of summarize what many of you have spoken
about, and what our Members here have asked questions about. We
know the dichotomy between United States policy with the Freely
Associated States, as well as the Chinese policy. The Chinese
policy is about a totalitarian regime that is transactional and
exploitive. They are looking at gaining an advantage out of
whatever relationships they want to develop with the Freely
Associated States. The United States has always been more of a
mindset of being a partner, you know, how can we share in those
things, how can we both mutually benefit from those
relationships?
The challenge with that is many times the outcome of that
is longer-term than it is shorter-term. And the Chinese are
very good about exploiting the shorter-term aspects of that.
Give me your perspectives, and I will ask each of you,
Colonel Newsham, beginning with you, give me your perspectives
as you look at the things that the United States needs to do in
the region. Give me your list of priorities, things we should
do in priority in the short term, and things we should do that
are more long-term in their prospects.
Mr. Newsham. A couple of things, sir, is first I would
recognize that the Chinese are at war with us. They have been
very clear about that, and there is no deal to be cut with
them. So, it requires a changed mindset. And recall that for
many years you couldn't, in the U.S. military, even say China
was an adversary. That changed around 2017. So, you have to
change the mindset.
But also, I said that permanent presence in the region, and
that will get you an awful long way, and I really do stress
that. Helping out with the illegal fishing, this is the main
asset many of these countries have and we are good at
workshops, but we are not very good at actually helping these
people see where the bad guys are, giving them the resources to
enforce it, and getting in with them.
And the last thing that I would do, and we have really
reduced our chances of success if we don't, is to go after the
Chinese corruption, $80 billion a year on intelligence. You
think we would put a little bit into the Pacific.
Mr. Wittman. Yes, sir. Very good.
Ms. Paskal?
Mr. Short. Sir? Just to add a bit more.
Mr. Wittman. Go ahead, yes.
Mr. Short. I think you are right on. The United States
tends to look at things, if you will, single-dimensional. It is
a transaction. The PRC, on the other hand, is basically multi-
functional. They have the concept of struggle. We think of
things almost in pigeonholes and boxes. We have peace, we have
war, we have this, we have that.
To the Chinese, it is a continuum of discrete but
integrated actions, all focused on the goal. And we have to
understand the goals, understand what actions are being taken,
and hopefully get out of the reactive mode and get in the
proactive mode. It is very difficult, and this really is a
cultural underpinning, if you will.
We tend to think of things black and white, left and right,
peace, war, we have a problem, we solve the problem. We don't
look at long-term impacts.
We simply have to get into that ball game if we are going
to be successful. Otherwise, as alluded to earlier, what we
have seen in the South China Sea with nefarious Chinese
activities could very well in the future be happening in the
Micronesian economic zone and the other Pacific islands, as
well. And if you look at it in military terms, what is that? It
is a flanking attack. They jump over the main line states and
attack the rear, and are successful.
The threat is clear and present. It has been growing for
years, and we have to recognize and respond to it.
Mr. Wittman. Very good, thank you.
Ms. Paskal?
Ms. Paskal. Short term, go after the dirty money. But there
are very specific things we can do. The Attorney General of the
Republic of Marshall Islands has asked for the information to
prosecute those two Chinese who tried to take over his country.
FBI hasn't given it to them yet.
You could also start with putting FBI detachments in some
of these countries to help with the investigations on some of
these things. As mentioned, there is a lot of intel that isn't
being shared.
Direct flights, cheaper flights, easier to get in and out
of the region would be incredibly important.
Sorting out the issue with the veterans, the people who
served in the U.S. military who go back home and then who are
left with no support. Our visual, emotional display to their
families and communities about whether the United States cares
or not about the relationship.
Longer term, maybe look at COFAs for Nauru, Tuvalu, and
Kiribati once we have shown that the relationship with the
existing COFA states is something that is beneficial to them.
Thank you.
Mr. Wittman. Thank you.
Dr. Lum, I am out of time, but if you could, just shortly,
give us your perspective.
Dr. Lum. I can think of three points.
One is visits, diplomacy, inviting Pacific Island leaders
here, going out there. President Biden had to cancel a trip to
Papua New Guinea. That was a big disappointment.
Two is providing incentives for U.S. companies to go out
there. For China it is a state-private mix, but we are a
private enterprise, so it is difficult for us.
And third is more coordination perhaps between DoD, State,
and Interior, particularly on the Compact countries.
Mr. Wittman. Thanks.
Madam Chairman, I yield back.
Mrs. Radewagen. The Chair now recognizes Ms. Porter for 5
minutes.
Ms. Porter. Mr. Short, you negotiated the previous COFA
agreement. What country is the largest threat right now to
finalizing a COFA agreement with all three Compact states?
Mr. Short. Please repeat the question.
Ms. Porter. Mr. Short, you negotiated the previous COFA
agreement. What country is the largest threat right now to
finalizing a COFA agreement with all three Compact states?
Mr. Short. Yes, I renegotiated what became the 2004
agreement, but only with the FSM and the Marshalls. Palau was
on a separate track.
Ms. Porter. Right, I want to ask you about the Marshall
Islands.
Mr. Short. The Administration correctly this time is
putting all three together into one negotiated package.
Now, you recognize we say Compacts or Compact. There are
three separate agreements. While they have many factors in
common, there are three separate established relationships with
the U.S. Government.
Ms. Porter. Mr. Short, reclaiming my time, I understand how
the Compacts work, and that there are three of them.
I read your 2003 testimony before this Committee in which
you talked about the importance of securing our Department of
Defense sites at the Kwajalein Atoll in the Marshall Islands.
What would happen to those defense sites if the Marshall
Islands decided not to sign a Compact with the United States,
and instead side with China?
Mr. Short. OK, the specific defense rights are embodied in
something called military use and operating rights agreements.
These are sub-agreements under the umbrella of the Compact. If
the Compact is not renewed or expires for whatever reason,
those agreements could be terminated. It would be a matter of
negotiation between the United States and the FAS.
I would note that the lease for Kwajalein was renegotiated
for a period of 50 years in the 2003-2004 renewal.
Separate from that, of course, is our right of strategic
denial, which I alluded to in my presentation. That gives us
the right to preclude any hostile or any third party that we
determine is hostile to our interests from operating there.
That has never been used and, hopefully, never will be. But
with the PRC's activities, it is possible in the future that we
may have to invoke that.
And in developing that denial provision, it is very
general. It doesn't say, if you, the FAS, do A, B, C, or D, we
will respond to A, B, C, or D. And purposefully, it was left
vague in the negotiations, but this was in the 1980s. The FAS
would come to us and say----
Ms. Porter. Mr. Short, I am going to have to reclaim my
time. Let me turn to Dr. Lum.
Would you say that securing a Compact agreement with the
Marshall Islands is essential to our national security?
Mr. Short. I am not familiar, no.
Ms. Porter. I am talking to Dr. Yum.
Mr. Short. Oh, excuse me.
Ms. Porter. Dr. Lum, Dr. Lum.
Would you say that securing an agreement with the Marshall
Islands is essential to our national security?
Dr. Lum. Yes, that would be essential to our national
security.
Ms. Porter. Thank you. If we are going to get to an
agreement with the Marshall Islands, and we are going to get it
across the finish line, and we have not yet secured their
agreement, then the United States is going to need to address
the issues that are standing in the way of the finalization of
that, the progress of that agreement.
Madam Chairwoman, I would like permission to enter into the
record this article from the Los Angeles Times.
Mrs. Radewagen. Without objection.
Ms. Porter. This 2021 LA Times article said, ``For months,
U.S. refusal to accept responsibility for a leaking dome of
radioactive waste in the Marshall Islands has complicated
negotiations with the Marshallese Government on an
international Compact viewed as critical for blunting Chinese
influence in the Central Pacific.'' Dr. Lum, what has the
United States done since this article to address the leaking of
radioactive waste at Runit Dome?
Dr. Lum. I can only point to a 2020 report that the
Department of Energy released stating that the dome was secure
for 20 years. But in actual activity, I could try to find the
answers.
Ms. Porter. I mean, the DoE is running simulations instead
of actually going there and doing the testing, and they are not
up to date on the groundwater monitoring that they are supposed
to do.
If the United States cannot address the radioactive waste
disposal in the Marshall Islands today, then you think we could
at least acknowledge the harms of nuclear testing in the past.
And I have had two hearings on this when I was Chair of the
Oversight and Investigations Subcommittee. I think, if you feel
wronged by someone, that it helps to rebuild trust to
acknowledge that they harmed you. And I think the United States
taking greater responsibility for its nuclear testing program
might help us get to a COFA agreement with the Marshall
Islands.
I am reintroducing my legislation to formally apologize for
the nuclear legacy of the United States in the Marshall
Islands, and I would hope that all members of this Task Force
would consider signing on and recognizing this is a real
barrier to getting to the agreement with the Marshall Islands.
I yield back.
Mrs. Radewagen. The Chair now recognizes co-Chairman Sablan
for his 5 minutes.
Mr. Sablan. Thank you very much.
I am actually pleased with this first hearing for various
reasons, but here is one thing.
[Slide.]
Mr. Sablan. I borrowed your slide, if I may, and just to
show the area involved with the Freely Associated States and
parallel with the United States' territory of Guam, the
Northern Marianas, and American Samoa, there with Australia.
But Mr. Newsham, if you can, how much do you think it would
cost the United States to secure this large swath of ocean
without a Compact from all three island nations, Palau,
Federated States of Micronesia, and the Marshall Islands?
Mr. Newsham. Sir, I actually did a sort of calculation in
my head----
Mr. Sablan. Yes, OK, go ahead.
Mr. Newsham. OK, thank you.
Mr. Sablan. And happy 284th birthday of the Army. I assume
you are in the Army?
Mr. Newsham. No, I am not able to read and write, so----
[Laughter.]
Mr. Sablan. All right.
Mr. Newsham. No, sir. I was with the Marines.
Mr. Sablan. OK. I joined the Army because you wouldn't take
me, but go ahead. Thank you. I am celebrating.
Mr. Newsham. Yes, sir. Actually, I tried to figure this
out, just my rough estimate, and this is just for starters and
is probably very low, you are going to need a lot more Navy
ships.
So, say you need 20 more ships, and that is considering
that you could have 7 on station at any time. Say each ship
costs $200 million, you are getting a real bargain price. Well,
you are already well up into the billions now, and that is just
for your initial cost. So, it is a huge cost to cover this
terrain, and it will be an ongoing recurring cost. You are
going to have to put people in there. That is going to cost you
money. And it is resources that don't go somewhere else. So,
you would be up, goodness, $100 billion. I will just throw that
out.
Mr. Sablan. Yes, so it would be billions, right? All the
way from, oh, my goodness, so much in Asia all the way to
Hawaii, for example, we are close to in the Marshall Islands,
right?
Mr. Newsham. I really don't think $100 billion is that far-
fetched, depending on how you figure it.
Mr. Sablan. All right. So, let me then ask. You mentioned
there could be some presence on the ground, the Peace Corps. I
am telling you, I benefited from the Peace Corps volunteers,
and I was away from home also. The Peace Corps volunteers had
an impact on the people of Micronesia.
And the one thing that is very hard for people to
understand this, I think, is that in Micronesia, we are liked,
people like the United States. To many Micronesians, the United
States is family. They have allies, other allies, but the
United States is family.
Coming to decide to come to negotiate with the United
States was a somber and serious thought choice, thoughtful
process. And then here we are going into agreement. Hopefully,
we will have the remaining island state. But all of this is
that we would give up this much and, in return, our people will
get this. So, all of these were done with the best intentions
possible for the best of the two partners here, the United
States and the island nations.
And I am trying to figure out how to bring to the attention
of many of my colleagues here the seriousness that this
deserves, if only to show the respect we have for the people of
these island nations and its leaders, the respect, because
respect says, yes, please respect, but know the seriousness,
the respect in conversations.
And I have heard people talk, too. And if you watch a
Pacific Islander talk to another Pacific Islander, for the most
part, it is different. The tone is different. But we are
welcome, we are welcome in Micronesia.
And I am very happy that the Ambassador, Envoy Yun, was
able to do this. I am wishing him good luck on the next
agreement. But we need to push this through.
Madam Chair, thank you for doing this also, and I have no
further questions. Thank you.
Mrs. Radewagen. I thank the witnesses for their valuable
testimony, and the Members for their questions.
The members of the Committee may have some additional
questions for the witnesses, and we will ask you to respond to
these in writing. Under Committee Rule 3, members of the
Committee must submit questions to the Committee Clerk by 5
p.m. on Tuesday, June 20, 2023. The hearing record will be held
open for 10 business days for these responses.
If there is no further business, without objection, the
Committee stands adjourned.
[Whereupon, at 11:47 a.m., the Task Force was adjourned.]
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