[House Hearing, 112 Congress]
[From the U.S. Government Printing Office]
BUDGET OVERSIGHT: EXAMINING THE
PRESIDENT'S 2012 BUDGET REQUEST FOR EUROPE AND EURASIA
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON EUROPE AND EURASIA
OF THE
COMMITTEE ON FOREIGN AFFAIRS
HOUSE OF REPRESENTATIVES
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
__________
APRIL 14, 2011
__________
Serial No. 112-43
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Printed for the use of the Committee on Foreign Affairs
Available via the World Wide Web: http://www.foreignaffairs.house.gov/
______
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COMMITTEE ON FOREIGN AFFAIRS
ILEANA ROS-LEHTINEN, Florida, Chairman
CHRISTOPHER H. SMITH, New Jersey HOWARD L. BERMAN, California
DAN BURTON, Indiana GARY L. ACKERMAN, New York
ELTON GALLEGLY, California ENI F.H. FALEOMAVAEGA, American
DANA ROHRABACHER, California Samoa
DONALD A. MANZULLO, Illinois DONALD M. PAYNE, New Jersey
EDWARD R. ROYCE, California BRAD SHERMAN, California
STEVE CHABOT, Ohio ELIOT L. ENGEL, New York
RON PAUL, Texas GREGORY W. MEEKS, New York
MIKE PENCE, Indiana RUSS CARNAHAN, Missouri
JOE WILSON, South Carolina ALBIO SIRES, New Jersey
CONNIE MACK, Florida GERALD E. CONNOLLY, Virginia
JEFF FORTENBERRY, Nebraska THEODORE E. DEUTCH, Florida
MICHAEL T. McCAUL, Texas DENNIS CARDOZA, California
TED POE, Texas BEN CHANDLER, Kentucky
GUS M. BILIRAKIS, Florida BRIAN HIGGINS, New York
JEAN SCHMIDT, Ohio ALLYSON SCHWARTZ, Pennsylvania
BILL JOHNSON, Ohio CHRISTOPHER S. MURPHY, Connecticut
DAVID RIVERA, Florida FREDERICA WILSON, Florida
MIKE KELLY, Pennsylvania KAREN BASS, California
TIM GRIFFIN, Arkansas WILLIAM KEATING, Massachusetts
TOM MARINO, Pennsylvania DAVID CICILLINE, Rhode Island
JEFF DUNCAN, South Carolina
ANN MARIE BUERKLE, New York
RENEE ELLMERS, North Carolina
VACANT
Yleem D.S. Poblete, Staff Director
Richard J. Kessler, Democratic Staff Director
------
Subcommittee on Europe and Eurasia
DAN BURTON, Indiana, Chairman
ELTON GALLEGLY, California GREGORY W. MEEKS, New York
GUS M. BILIRAKIS, Florida ELIOT L. ENGEL, New York
TIM GRIFFIN, Arkansas ALBIO SIRES, New Jersey
TOM MARINO, Pennsylvania THEODORE E. DEUTCH, Florida
JEAN SCHMIDT, Ohio
TED POE, Texas
C O N T E N T S
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Page
WITNESSES
Mr. Daniel Rosenblum, Coordinator of U.S. Assistance to Europe
and Eurasia, Bureau of Central and South Asian Affairs, U.S.
Department of State............................................ 8
Ms. Susan Elliott, Deputy Assistant Secretary, Bureau of European
and Eurasian Affairs, U.S. Department of State................. 16
Ms. Paige Alexander, Assistant Administrator, Bureau for Europe
and Eurasia, U.S. Agency for International Development......... 20
Ms. Nisha Biswal, Assistant Administrator, Bureau for Asia, U.S.
Agency for International Development........................... 26
LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING
The Honorable Dan Burton, a Representative in Congress from the
State of Indiana, and chairman, Subcommittee on Europe and
Eurasia: Prepared statement.................................... 4
Mr. Daniel Rosenblum: Prepared statement......................... 11
Ms. Susan Elliott: Prepared statement............................ 19
Ms. Paige Alexander: Prepared statement.......................... 23
Ms. Nisha Biswal: Prepared statement............................. 29
APPENDIX
Hearing notice................................................... 50
Hearing minutes.................................................. 51
Questions submitted for the record to Mr. Daniel Rosenblum and
Ms. Susan Elliott by the Honorable Dan Burton.................. 52
Questions submitted for the record to Mr. Daniel Rosenblum by the
Honorable Ted Poe, a Representative in Congress from the State
of Texas....................................................... 55
BUDGET OVERSIGHT: EXAMINING THE PRESIDENT'S 2012 BUDGET REQUEST FOR
EUROPE AND EURASIA
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THURSDAY, APRIL 14, 2011
House of Representatives,
Subcommittee on Europe and Eurasia,
Committee on Foreign Affairs,
Washington, DC.
The subcommittee met, pursuant to notice, at 2:30 p.m., in
room 2200, Rayburn House Office Building, Hon. Dan Burton
(chairman of the subcommittee) presiding.
Mr. Burton. Good afternoon. The Subcommittee on Europe and
Eurasia will come to order.
Last week's budget debate between Republican leadership and
the White House showed how divided and contentious discussions
about our spending have become. Democrats like my colleague
here continue to ask for bigger government than this Nation can
afford. We don't collect enough revenue to meet spending, and
the revenue we do collect largely goes to paying interest on
the debt which foreign nations hold.
Contrary to the belief held by some on Capitol Hill, the
average American doesn't want to have excess funds to pay for a
bigger government. Neither could we ask Americans to pay more,
nor borrow, greater amounts by mortgaging the future of our
society and our children and our grandchildren. I am sure you
have all heard that.
As our budget problems become more alarming, President
Obama has ignored his own advisors on the debt, refusing to
adopt many of the recommendations. Ben Bernanke, Erskine
Bowles, and Alan Greenspan have said that the President's
spending is not sustainable. The Congressional Budget Office
agrees with this assessment. However, the President recently
handed Congress a bloated budget request for 2012. President
Obama has already overspent by $830 billion in the first 6
months of this year, the 2011 budget year, with the
Congressional Budget Office projecting that the total 2011
deficit spending will reach $1.5 trillion. By contrast, the
entire debt that was accrued between 2000 and 2008 was only
$1.76 trillion. So what we incurred as debt between 2000 and
2008 was not much more than we are incurring just this 1 year.
So we have got a real fiscal problem. The deficit spending
of the U.S. Government is out of control. As members of this
subcommittee, we have an obligation to the American people to
conduct responsible oversight of the portion of the U.S. budget
under this subcommittee's jurisdiction.
I know the State Department budget is less than 1 percent
of GDP. I don't understand those who point to the relatively
small size of the State Department budget as being itself a
justification. No amount of taxpayer money is too small to go
unjustified.
The proposal we discuss today increases the core State
Department budget to $53 billion and represents an increase of
23 percent, $10 billion over the Department's 2008 budget of
$43 billion. And that is one of the things I know that you know
we are concerned about. We want to stay as close to the 2008
budget as possible because of the overspending, and a 23
percent increase just isn't going to cut it.
I have heard from some who still want more spending, or to
protect their own share of the Federal pie. And I have told
them the same thing, that we just have to cut spending, there
is no more pie left.
Today, I will ask our witnesses to identify areas of
essential spending and for them to prioritize programs and
needs. And I know you are all qualified to do that. We must
curtail some programs, even if they are noble and justified,
because we just don't have the money. The reasoning that we are
doing great things and it helps our friends, those are good
reasons, but we can't justify a total deficit that has
increased by $4.19 trillion in the last 2\1/2\ years. I mean,
it boggles my mind.
We have continuously overfed a beast whose burden will
consume us all, yet, there is little urgency to do anything
about it. So, I ask everyone, Republicans and Democrats, to
raise the bar of what constitutes justifiable spending so that
``essential'' truly means ``essential,'' and that the only
spending done is for programs that are truly vital to our
national interest.
It is with relief that I see the budget request that is
pertaining to the jurisdiction of this subcommittee, decline
from previous years. I understand that the efforts of the State
Department and the Agency for International Development to
develop democracy, rule of law, and stronger government
institutions, have paid off, meaning the need for many programs
no longer exists.
However, there still exists a need for concentrated efforts
in some countries that continue to receive assistance. The
Balkans, which have made great progress in the last 15 years,
still need attention to help permanently solidify democracies
and ascension into the transatlantic community. The Caucasus,
which have greater needs, still struggle with diversifying
economic and political relations beyond their historic
connections to Moscow. And we met one of their Ambassadors
today.
The Central Asian countries continue to transition at a
slower pace than anticipated, as they attempt to balance the
needs for government reforms, protection of rights, stronger
democracy and economic development, after years of Soviet
influence.
I recognize that reforms and development will take time as
well as funding by the United States and the international
community of nations. For this reason, we should be careful
about how we spend our precious dollars. We should focus on
productivity and efficiency in our work with the like-minded
actors. Specifically, I applaud U.S. efforts in Kyrgyzstan,
where democratic reforms offer so much promise. I also commend
U.S. support of Georgia as it deals with, to put it delicately,
a very overbearing neighbor. And, I just met with their
Ambassador, who seems like a pretty dedicated individual. I
believe in working together and providing assistance to
countries that are like-minded in the belief that we will get
the most return on our dollar.
In that vein, I question the necessity to spend $72 million
in Russia, where it seems our taxpayer dollars have little
chance of making a lasting impact. Additionally, Ukraine,
Kazakhstan, among others, are also concerns as to how effective
our efforts can truly be when they and others seem to sway
between democracy and autocracy.
I do not advocate for boarding up USAID offices and
removing the United States from the region. However, less can
be more. Throwing more taxpayer dollars at problems does not
guarantee favorable results.
I thank the witnesses for being here today, and agreeing to
visit the Hill and testify in such a turbulent time of debate
between Congress and the Obama administration, regarding
spending.
I will recognize all four of you as dedicated public
servants to the United States, and I will not throw any rocks
at any of you. That is not in the script. But nevertheless, any
criticism you might hear today is not a personal, but
institutional concern. However, I do take exception to how
American policymakers in general continue to spend taxpayer
money so easily and at such high rates, the likes of which this
country has never seen before. This has to come to an end
because we are just about broke.
[The prepared statement of Mr. Burton follows:]
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Mr. Burton. And now I would like to recognize my friend for
a long, long time, Mr. Engel.
Mr. Engel. Thank you, Mr. Chairman. And I know that the
bells have gone off, so I will try to condense everything.
First of all, I want to welcome our witnesses. All have long
and distinguished----
Mr. Burton. Excuse me. I don't want to interrupt you, but I
have to. On the clock, we have 10 minutes until this vote is
over, so I will try to adjourn here or recess when we have 5
minutes to go. Is that all right?
Mr. Engel. That is good. I want to thank you for being
here. And I am sitting in for Mr. Meeks today who has a family
emergency. And he sends his best and he is sorry he is not able
to be here.
Mr. Burton is one of my best and closest friends, but we
don't agree much on politics. We do actually agree a lot on
international politics. But domestic spending is a little bit
different. I know that we have to tighten our belts. We can't
just keep spending and spending and tighten our belts. But I
don't want to be penny-wise and pound-foolish.
We can spend $1 trillion on a war or on two wars or on
three wars, or $1 billion to prevent a war. So I think that
when we are talking about foreign assistance, I often wonder
when I look and see all our people, our dedicated people around
the world--and I know Mr. Burton has too--I don't know how they
do it. I just don't know how we do it.
This is a very important time and I think that we need to
put our money where our mouth is. I think cutting foreign
assistance in USAID is a disaster, quite frankly, because 1
percent of the budget--if you ask the American people, they
think it is 15 percent of the budget. I have seen these
different surveys. So I think now, at a time when we have such
a crisis going on in the Middle East, when we have difficulty
with states of the former Soviet Union, when we have all kinds
of problems, I don't think we should throw good money after
bad. But I don't think that we should just, you know, cut for
the sake of being cut. And I know that I feel very strongly
that the whole discussion shouldn't just be about cutting. Yes,
it should be about cutting partially. But it really is what our
priorities are; how, you know, how equal can we be?
I find difficulty with tremendous tax breaks at a time we
are cutting everything. I think it has got to be a balance, and
that is what I really object to. But the chairman and I--and we
have been chairs and ranking members for each other and we have
worked closely together, and we don't really disagree all that
much when it comes to foreign policy. I believe in a robust
foreign policy. I believe that the United States needs to be
engaged. If we are not engaged, then our enemies will move in
and they will be engaged. Russia is trying, time and time
again--I am not saying Russia is an enemy, but Russia has its
own interests and their interests are not necessarily ours.
I chaired the Western Hemisphere Subcommittee, as did Mr.
Burton, and we know that there are enemies in that area. We
could start with Hugo Chavez and continue. The Chinese are
always trying to invest and do these different kinds of things.
So, if we don't--if there is a vacuum and we don't move in,
shame on us, because we are really hurting our self-interest.
So I think it is a delicate balance. You don't want to
spend money that you don't have. On the other hand, you don't
want to pull out programs that you know are very, very
important.
So while budgets are tight, U.S. assistance to the European
countries still making the transition to democracy in market
economies is very, very important. And many countries have
graduated from our assistance programs. The leading Central
European countries, Poland, Hungary, Czech Republic, Slovakia,
and Slovenia don't need much more aid, if any at all. And
still, though, some of the Balkan countries, the Caucasus and
Central Asia, can still benefit from American help to
strengthen their institutions and help their transition to a
market economy.
I would like to highlight only some of the key cooperation
we have with our European partners. From pressure on Iran to
the no-fly zone in Libya, to the massive commerce and cultural
exchanges, our relations with the region that deepen our ties,
are permanent. We need to continue our intense involvement with
the EU and other partners in Europe, and assistance programs I
believe are still very important.
One of the questions I am going to ask you--and I have been
very much involved in the Balkans throughout the 23 years I
have been in Congress, and I have been one of the leading
supporters of an independent Kosovo--I will ask you about the
Enterprise Fund because the Albanians have returned a chunk of
the Enterprise Fund. It has been very successful. Albanians in
Albania and I want to talk about establishing an Enterprise
Fund for Kosovo. I had heard that the days of the enterprise
funds were over, but earlier this year I have learned that we
are working on one for Egypt. So these are some things I would
like to talk about.
I promised the chairman I would be 5 minutes or less, and I
am going to keep my promise. And I look forward to listening to
you.
Mr. Burton. We will stand in recess till the fall of the
gavel, and we will be back. We have two votes. It shouldn't be
too long.
[Recess.]
Mr. Burton. While Mr. Engel is coming, I will introduce our
guests. Daniel Rosenblum is the Coordinator of the U.S.
assistance to Europe and Eurasia in the State Department's
Bureau of European Affairs, European and Eurasian Affairs. And
Mr. Rosenblum oversees all U.S. Government assistance to more
than 30 countries in Europe and Eurasia, with primary focus on
the Balkans and the former Soviet Union, including Central
Asia. Welcome, Mr. Rosenblum.
Paige Alexander was sworn in as Assistant Administrator of
the Bureau for Europe and Eurasia at the U.S. Agency for
International Development on January 3 of this year. Ms.
Alexander heads USAID's development efforts for Europe and
Eurasia. Prior to her current position, she was Senior
Vice President of IREX, an international nonprofit
development organization. So thank you.
Susan Elliott. Ms. Elliott is Deputy Assistant Secretary of
Central Asia in the State Department's Bureau of South and
Central Asian affairs. Ms. Elliott is a career Foreign Service
officer and her posting includes Russia, Northern Ireland,
Secretary Rice's office, Greece and Peru. That is interesting.
They have got four countries with Secretary Rice right in the
middle there. I don't understand that. Is that a country--
Secretary Rice?
Ms. Elliott. I worked on her staff in between overseas
postings.
Mr. Burton. I understand. I am just pulling your chain
there.
Nisha Biswal is the Assistant Administrator for Asia for
the USAID and oversees their efforts in Central Asia. Prior to
her current position, Ms. Biswal was a staff member of the
Foreign Operations Subcommittee on the House Appropriations
Committee, and the director of InterAction, the largest
alliance of U.S.-based development and humanitarian NGOs. I
want to thank you very much for being here.
I know he is on his way. Okay. As a matter of fact, there
he is, folks. Let's hear it for my buddy. Okay.
We will start with Mr. Rosenblum. Mr. Rosenblum, we will
recognize you for 5 minutes.
STATEMENT OF MR. DANIEL ROSENBLUM, COORDINATOR OF U.S.
ASSISTANCE TO EUROPE AND EURASIA, BUREAU OF CENTRAL AND SOUTH
ASIAN AFFAIRS, U.S. DEPARTMENT OF STATE
Mr. Rosenblum. Thank you, sir. Chairman Burton, Congressman
Engel, thanks for inviting us today to talk to you about our
Fiscal Year 2012 budget request for foreign assistance to
Europe, Eurasia and Central Asia. At today's hearing, I hope we
can give you a good sense of how our assistance programs
support U.S. foreign policy interests in ways that directly
relate to the security and well-being of the American people.
The President's Fiscal Year 2012 request for this region
attempts to balance an awareness of budget constraints with a
continued commitment to advancing stability, prosperity and
democracy. Our request trims approximately $140 million from
the budget for the entire region relative to our 2010 levels.
My written testimony provides more detail about our request,
and I would ask to submit it for the record.
Mr. Burton. Without objection.
Mr. Rosenblum. In my limited time, I will try to hit the
key points.
First, U.S. foreign assistance to this region has helped
bring about a remarkable foreign policy success. Twelve of the
formerly Communist states of Central and Eastern Europe are
members of NATO; 10 of those 12 are now members of the European
Union. These countries are among the most stalwart allies of
the U.S. in the world. They recognize that the generous U.S.
support for their reform efforts in the 1990s and the early
2000s played an absolutely critical role in getting them to
where they are today. That support also generated enormous
goodwill in those countries so that today these are some of the
most pro-American places on Earth.
I would argue that the key to these successes has been
consistent policy and resource support over the past 2 decades.
The SEED Act and the FREEDOM Support Act were about transition
from communism to democracy and free markets, and a strong
commitment to that goal has spanned four administrations,
Republican and Democratic, and has been supported by the
Congress on a bipartisan basis.
My second main point is that the job isn't done. We have
learned over the past 20 years that the line from communism to
democracy and free markets is not a straight one. We have
encountered challenges and setbacks not anticipated in the
early 1990s. Those who wrote the SEED Act, for example, never
imagined the violent breakup of Yugoslavia and the consequences
that we are still dealing with today. The conflict over
Nagorno-Karabakh, between Armenia and Azerbaijan, civil war in
Tajikistan, separatist movements in Moldova and in Georgia,
have all left lasting scars.
While a few countries experienced democratic breakthroughs
over the past decade, a greater number of former Soviet
countries have seen major backsliding on democracy as old
authoritarian habits reasserted themselves.
Meanwhile, a series of transnational threats have emerged.
Criminal groups trafficking in narcotics, trafficking in
persons and in weapons, filled vacuums left by receding State
authority. Infectious disease, such as HIV/AIDS and drug-
resistant tuberculosis, began claiming lives. The risk of
international terrorism is real, and porous borders of this
region make it a potential conduit for extremists of all
stripes.
Mr. Chairman, Mr. Engel, this transition is a complicated
process in which change will take longer, perhaps considerably
longer in some countries than others. And we believe that U.S.
engagement, while not in itself sufficient, is a necessary
ingredient for achieving that transition goal.
Third point. We are committed to the principle that foreign
aid is not a permanent entitlement. Our job is to work
ourselves out of a job. All nonmilitary assistance in the
region is undertaken with an eye to graduating aid recipients
when they have achieved a level of economic and democratic
reform sufficient to ensure continued development. Eleven
countries so far have graduated from U.S. assistance. And over
the past decade we have developed a methodology for phasing out
assistance to the rest, based on evaluating performance data
collected by various international organizations.
And with your permission, Mr. Chairman, we will submit for
the record further information about this methodology.
Mr. Burton. Without objection.
Mr. Rosenblum. My fourth and final point is that we seek to
always maximize the impact of the resources provided by the
American taxpayer for these programs. And we do this in several
ways: By constant monitoring and evaluation of programs so we
can draw lessons from our past successes and failures; by
seeking to get buy-in from governments in recipient countries,
including in a few cases by actually getting them to share the
costs of financing our technical assistance, and we can talk
more about that later if you are interested; and by leveraging
the work of other international donors, especially the European
Union and the multilateral development banks.
Mr. Chairman, let me close by emphasizing that what happens
in Europe, Eurasia, and Central Asia matters to the United
States. Criminal networks, WMD proliferation, infectious
disease, these threats have a direct bearing on the security
and well-being of American citizens.
We also benefit if more of these countries become stable
democracies with market economies that generate growth and
thereby create trade and investment opportunities for American
companies and potential jobs for American workers.
We will continue to use the resources provided to us by
Congress and the American people in the most effective way
possible, always mindful of the very real resource constraints
affecting foreign assistance. Thank you, sir.
Mr. Burton. Thank you, Mr. Rosenblum.
[The prepared statement of Mr. Rosenblum follows:]
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Mr. Burton. Ms. Elliott.
STATEMENT OF MS. SUSAN ELLIOTT, DEPUTY ASSISTANT SECRETARY,
BUREAU OF SOUTH AND CENTRAL ASIAN AFFAIRS, U.S. DEPARTMENT OF
STATE
Ms. Elliott. Thank you, Chairman Burton, thank you
Congressman Engel. As a graduate of the Indiana University and
former resident of the State of New York, it is an honor for me
to testify in front of you today. I am glad only the two of you
are here.
Mr. Burton. Your are a real politician.
Ms. Elliott. As you mentioned, I am the Assistant Secretary
of State in the Department of State's Bureau of South and
Central Asian Affairs. I have responsibility for policy
coordination with the countries of Central Asia.
During my 20-year career in the Foreign Service, I have
worked on a wide range of issues related to the countries of
the former Soviet Union and have traveled extensively in the
region.
As Assistant Secretary of State Robert Blake underscored in
his remarks to this committee last month, the United States has
an important interest in promoting a stable, secure and
prosperous Central Asia. Since the breakup of the Soviet Union,
our primary policy goal in Central Asia has been to ensure that
these newly independent countries remain sovereign and
independent while helping them become stable, market-oriented
democracies.
The United States currently pursues a broad range of policy
goals in Central Asia. Today, I would like to speak to you
about the importance of the administration's goals for U.S.
engagement and assistance in Central Asia.
Our first goal is to engage the countries of Central Asia
to cooperate with us in stabilizing Afghanistan. We believe
that Central Asia plays a vital role in our Afghanistan
strategy. Three of the five Central Asian states share borders
with Afghanistan, and the Northern Distribution Network is an
increasingly important route for transporting supplies to our
troops in Afghanistan. The Central Asian countries already are
contributing greatly to international efforts in Afghanistan,
from supplying much needed electricity, to providing
humanitarian assistance, to supporting educational
opportunities to Afghan students. A stable future for
Afghanistan depends on the continued assistance of its Central
Asian neighbors and likewise, we believe, greater peace,
stability, and prosperity in Afghanistan will ensure a stable
prosperous future for Central Asia.
Our second goal is develop stronger bilateral relationships
with the countries of Central Asia in order to make progress on
democracy and human rights. In December 2009, we announced our
intention to hold annual bilateral consultations with each
country in order to deepen our engagement with Central Asia.
Over the last 1\1/2\ years, we have conducted these
consultations with all of the Central Asian states except
Kyrgyzstan, whose meeting is scheduled for later this year.
These annual bilateral consultations offer a structured
dialogue covering a full range of bilateral priorities and
result in a work plan to address our key priorities and outline
practical steps to advance U.S. policy. While pursuing these
goals is often challenging, our engagement and our assistance
is yielding important results. Last week marked the 1 year
anniversary of the transition to a new government in
Kyrgyzstan, and we are grateful that anniversary passed
without--passed peacefully. Our assistance in engagement with
the government and people of Kyrgyzstan over the last year has
focused on addressing ethnic violence that boiled over last
June. We also have tried to assist them to create conditions
necessary for the first democratically elected Parliament in
Central Asia to succeed, the administration's priority to work
alongside other donors to bolster Kyrgyzstan's stability and
solidify democratic reforms.
Our third goal involves combating narcotics trafficking. We
are developing a new counternarcotics initiative that will
focus on assistance to governments in the region to create
counternarcotics task forces. Our objective is to use
intelligence collection and analysis and effective
investigative teams to target organized traffickers, seize and
confiscate their assets and bring them to justice.
Mr. Chairman, we agree with you that we should be careful
about how we spend our precious resources. We view our
assistance funding to the region to be a critical tool in
accomplishing our policy goals. We envision a future in which
the United States and the countries of Central Asia work
together for peace, security, democracy, and economic
prosperity. We recognize that the pace of change can be slow
and that our assistance should support programs oriented toward
long-term meaningful results. But through our policy engagement
and targeted assistance funding, we aim to strengthen our ties
with these important countries and their people and advance
U.S. interests in the strategically important region. Thank
you.
Mr. Burton. Thank you very much. It is nice to have an
adopted Hoosier with us. We will forget about New York. You
don't mind, do you?
[The prepared statement of Ms. Elliott follows:]
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Mr. Burton. Ms. Alexander.
STATEMENT OF MS. PAIGE ALEXANDER, ASSISTANT ADMINISTRATOR,
BUREAU FOR EUROPE AND EURASIA, U.S. AGENCY FOR INTERNATIONAL
DEVELOPMENT
Ms. Alexander. Thank you, Chairman Burton, Ranking Member
Engel and members of the subcommittee. Thank you for inviting
me here today to discuss USAID's successes in Europe and
Eurasia, the persistent development challenges, and our future
direction in a period of resource constraints.
The President's Fiscal Year 2012 budget request for Europe
and Eurasia builds on the momentum of reform. It seeks to
entrench stability and addresses the key challenges that
inhibit full democratic and economic transitions in the region.
Reflecting on the tight budget environment, successes in key
areas, and the need to fund other global priorities, the
President's request represents a significant decline in
resources from previous years. Twenty years of USAID engagement
in Europe and Eurasia has produced sustainable democratic and
economic transitions in 11 of the original 24 countries that
received assistance; 17 countries have joined the WTO, 10 have
acceded to the European Union, and 23 have joined NATO. Once
our opponents in the Cold War, the former Eastern Bloc States
have graduated from assistance and are now among the strongest
supporters of U.S. foreign policy objectives.
We continue to advance transitions by actively building on
sustainable partnerships and addressing key challenges that
further U.S. national security interests as well as our
economic interests. USAID assistance prevents instability and
fosters these emerging markets. We have seen that the ability
of other countries to weather global economic crises directly
affects the U.S. economic stability in this globalized market.
USAID promotes broad-based economic growth to create the
American markets of tomorrow by building local entrepreneurship
and innovation, and strengthening institutions in investment
environments. We are confident that the resources that the U.S.
interests invest in this region will continue to provide a
strong return on investments and help achieve our core policy
objectives.
As Dan laid out four major assistance goals, I would like
to reiterate the President's request which reflects our
commitment in the region and issues that both of you mentioned.
Partnership with Russia as an emerging donor, while
pressing for respect of universal values and democratic
liberty. As I am sure the Georgian Ambassador brought up to
you, enhancing the stability for the Caucasus through
assistance for economic growth and democracy, particularly
building on the postconflict gains in Georgia.
Promoting democratic and economic reform in Ukraine,
support of Moldova's progress toward European integration by
strengthening democratic institutions and promoting economic
growth, addressing the most difficult challenges to democracy
and human rights, like those in Belarus. And, as Congressman
Engel mentioned, increased stability in the Western Balkans by
helping countries there reach their goal of Euro-Atlantic
integration through programs that strengthen economic
opportunity, build democratic institutions, and promote
tolerance and reconciliation.
We will work with increased efficiency and creativity to
address the key challenges and advance the democratic and
economic transitions in this region.
USAID is fundamentally transforming the way that we work by
strategically realigning our Foreign Service officer positions,
empowering our local staff, and increasing reliance on cost-
effective DC-based staff to restructure our field presence.
By Fiscal Year 2012, we will also end USAID funding for
assistance programs in Montenegro, which is middle-income
country that is on a sustainable path to becoming a fully
democratic and market-based economy. Through the USAID forward
reforms, we are rebuilding our efforts to increase donor
coordination in this region, enhance the sustainability through
local capacity building, and to use science to leapfrog global
development challenges.
To further improve efficiency and effectiveness to meet
continuing challenges, we are leveraging funding to maximize
the impact achieved with every taxpayer dollar spent in this
region. We are partnering with international donors, host
countries, and the private sector, to amplify our results and
to achieve these positive development outcomes.
In Bosnia-Herzegovina, USAID has leveraged over $60 million
in additional funding from other international donors,
including the launch of the first-ever jointly funded
Development Credit Authority Loan Guarantee Program. And it
unlocked $40 million to spur local entrepreneurship by
combining capital with the Swedish International Development
Agency.
In Azerbaijan, the host government has provided a near one-
to-one match to co-finance USAID implemented economic growth
and community development programs. Throughout the region,
USAID has leveraged over $350 million in public-private
partnerships through our Global Development Alliance. So with
Congressional support, USAID has financed 10 Enterprise Funds,
covering 18 countries, and that has leveraged over $9 billion
in additional financing to strengthen private sector growth.
The profits from these funds have been reinvested in the target
countries to further propel economic development, and have
already returned over $180 million back to the American
taxpayers through the U.S. Treasury. We are also forging new
partnerships with emerging donors to work with us to overcome
development challenges.
I look forward to working with you as we transform the way
that we work to advance U.S. interests in meeting the 21st
century development challenges, and building a strong
partnership with the stable and sustainable market-oriented
democracies in Europe and Eurasia. Thank you and I welcome any
questions.
Mr. Burton. Thank you, Ms. Alexander. The remainder of your
statement we will put in the record.
Ms. Alexander. Thank you.
[The prepared statement of Ms. Alexander follows:]
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Mr. Burton. Ms. Biswal.
STATEMENT OF MS. NISHA BISWAL, ASSISTANT ADMINISTRATOR, BUREAU
FOR ASIA, U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT
Ms. Biswal. Thank you, Mr. Chairman.
Mr. Burton. Incidentally, let me just say that we have been
joined by my good friend, Congressman Poe from Texas, and Mr.
Deutch. Thank you both for being here.
Ms. Biswal. Thank you, Mr. Chairman, Congressman Engel,
Congressman Deutch, and Congressman Poe, thank you for inviting
me to testify today. And I also ask that the full statement be
placed in the record
Mr. Burton. Without objection.
Ms. Biswal. This afternoon, I want to share my perspective
on how U.S. foreign assistance in Central Asia is promoting
stability, encouraging reforms, and meeting urgent needs.
Mr. Chairman, there is no question that Central Asia is a
challenging environment in which USAID works. The lack of
political space and the human rights record has been troubling.
And yet, we have clear and compelling interests in Central
Asia, as my colleague Susan Elliott mentioned, the most
important being the impact on our ability to succeed in
Afghanistan and Pakistan.
In Fiscal Year 2012, the President's budget requests a
total of $112.8 million for Central Asia through the AEECA
account, a decrease of 14 percent from the Fiscal Year 10
enacted levels. The request also includes $35.3 million in
global health and child survival funding to support health
activities in the region.
Our programs in Central Asia are built around key USAID
successes over the years. In 1998, technical support provided
by USAID was instrumental in helping Kyrgyzstan become the
first country in the region to join the WTO. Today, Kazakhstan
is also making progress toward WTO membership, again with USAID
assistance. In Kazakhstan, a country which has shown strong
growth fueled by oil and gas reserves, USAID's modest program
leverages $2 of Kazakh funding for every dollar of U.S.
investment for assistance to promote legal regulatory and
policy reforms, as well as supporting the expansion of small
and medium enterprises.
Regionally, our health programs have had widespread impact.
Millions of citizens across the region have greater access to
primary health care based on USAID's introduction of family
medicine, replacing the old Soviet system.
And while political space in the region is very narrow, the
Kyrgyz Republic, as you noted, Mr. Chairman, represents a
bright spot for democracy in Central Asia. Kyrgyzstan is
undertaking what Secretary Clinton has called a bold endeavor
to strengthen and deepen parliamentary democracy in a region
where such successes are few.
USAID is doubling down on our efforts to support the
democracy efforts in Kyrgyzstan. USAID was there on the ground
and able to provide quick support for constitutional referendum
and the parliamentary elections, which occurred last year, and
we will be there to help Kyrgyzstan prepare for the upcoming
Presidential elections as well. And if Kyrgyzstan does succeed,
it becomes a model of how democracy can deliver for the people
of Central Asia. And if it fails, that failure will be
exploited by regional forces unfriendly to democracy and
pluralism.
Mr. Chairman, if I may quote my good friend, Ken Wollack of
the National Democratic Institute, Kyrgyzstan is not Las Vegas,
and what happens in Kyrgyzstan will not stay in Kyrgyzstan. It
will spread throughout the region. We are working to make sure
that that impact is a positive one.
Tajikistan, USAID's second-largest program, has had a
markedly different trajectory and experience. The economic
development there has been frustrated by widespread corruption,
food and energy shortages, and over-reliance on remittances
from abroad. The 2012 request of $42 million will focus on
improving food security and addressing health concerns.
USAID support has helped farmers establish more than 30
associations of water users and has led to better management of
irrigation and drainage systems, helping many farmers to nearly
double their income. We hope to reach an additional 30,000
households through our agricultural programs in funds requested
in Fiscal Year 2012.
Our health care programs allowed us to provide a rapid
response to the polio outbreak and was instrumental in halting
the world's largest outbreak of polio in decades, and that was
accomplished through a partnership with Russia as well as
India.
Finally, energy security is another area of focus and long-
term stability in Central Asia and its economic success will
depend greatly on energy production. The countries of Central
Asia tend to look at this issue singularly, and we are working
to create more regional cooperation as well as enhance regional
energy markets, and improve capacity, so that Central Asia can
become a more efficient exporter of energy, particularly to
Afghanistan and Pakistan.
Let me just conclude, Mr. Chairman, by saying that
development saves lives. It strengthens democracies and expands
our opportunities around the world. But it also keeps our own
country safe and strengthens our own economy. USAID programs in
Central Asia are a critical component of securing our vital
interests in the region.
Thank you very much for the opportunity to testify today,
and I welcome any questions you may have.
Mr. Burton. Thank you very much.
[The prepared statement of Ms. Biswal follows:]
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Mr. Burton. You say what happens there is not like Las
Vegas. How did you come up with that analogy? I am just
curious.
Ms. Biswal. Well, I can't take credit for it, sir. I
borrowed it from Ken Wollack of NDI, but I thought it was a
brilliant one.
Mr. Burton. It was brilliant, yes. Have you ever been to
Las Vegas?
Ms. Biswal. I have not. I have been to Atlantic City.
Mr. Burton. Well, let me know when you go. If what happens
there stays there, would you let me know when you get back?
Ms. Biswal. I will indeed.
Mr. Burton. All right.
First of all, I will recognize myself for 5 minutes. You
know, the thing that concerns me is we had a budget in 2008
of--let me get the figure here--53--$43 billion in 2008. What
we are trying to do on the Republican side, of course we are
going to have to compromise, I am sure, to some degree with the
Democrats in the Senate and the White House, but the State
Department had a budget in 2008 of $43 billion, and our target
is to use 2008 figures as far as our budgetary concerns are
this year.
You are asking for, or your proposal is $53 billion this
time, which is a 23 percent increase at a time when we don't
have any money. The budget deficit this year is going to be
between $1.5- and $1.6 trillion. We are facing a $14 trillion
national debt, and while I understand that everything that all
four of you have said is meritorious, what we have to do is
have every department of government go back and actually take a
fine point on their pencil and cut out anything that is not an
absolute necessity, and is not necessary for the security and
longevity of the United States of America.
And so, and I understand from your testimony today, that
your section has actually decreased since 2010. But you didn't
tell me what it did between 2008 and 2010. Does anybody have an
answer to that? From the 2008 appropriation that was made for
your section of the world, has the amount gone up or down? I am
not talking about 2010.
Mr. Rosenblum. Mr. Chairman, I don't have the 2008 number
in front of me, but from my memory, I believe that the 2010
level was still lower than we were in 2008.
Mr. Burton. Really?
Mr. Rosenblum. Yeah. But we will get back to you with the
accurate answer on that. If we look over a longer period of
time, I can say, because this is sort of seared into my mind,
that in comparison to where we were 10 years ago in the region,
we are actually down by about 60 percent in foreign aid. We
were about $1.5 billion, and the request for this year, as you
see, is a little over $600 million for the foreign aid portion
of what we are doing. So over time, because of the countries
graduating from assistance and because of focusing our programs
on the highest priorities, we have been able to come down
significantly.
Mr. Burton. The 2012 request is what, $626 million?
Mr. Rosenblum. Yes, $626 million. That is for the
assistance to Europe, Eurasia, and Central Asia accounts. If
you include all the accounts, the 2012 request is a little over
$900 million. That includes the military assistance and some of
the global health.
Mr. Burton. And that, compared to 2008 is still lower, as
you recall?
Mr. Rosenblum. As I recall, it is.
Mr. Burton. Well, if you could get me those figures I would
really appreciate it.
The Bureau's--and I hate to hit you on salaries, but this
is part of the overall issue that we have to look at--the
Bureau's spending on American salaries has gradually risen from
$217 million in 2008 to about $237.5 million in 2011. And the
Fiscal Year 2012 budget request, $266 million, rather. So you
have got an increase over the 2008 levels of about $50 million.
And I know everybody wants to make more money. But is there
any way, or can you give us an idea on whether or not there are
any economies that can be made at State to deal with that?
Mr. Rosenblum. Mr. Chairman, I hate to do this twice in a
row, but I will respond--we will respond with a more detailed
response.
Mr. Burton. Okay. Along with that response----
Mr. Rosenblum. In writing.
Mr. Burton. You actually had a decrease in American staff
that has been employed by the Bureau of European and Eurasian
Affairs. So even though you have had a decrease in staff, you
have got almost a $50 million increase in spending, so----
Mr. Rosenblum. Sir, the one thing I will say is that the
primary cost drivers, as you have noted, for the cost of the
salaries relate to the general operating expenses, maintenance,
and utilities at our posts overseas. And those costs do tend to
rise over time, even though when you cut down the staff size,
sometimes the overall cost rises.
Mr. Burton. Is that because possibly the value of the
dollar has decreased in competition with the European
currencies?
Mr. Rosenblum. That is one of the factors. But again, to
give you the full answer you deserve, I will have to get back
to you in writing.
Mr. Burton. My time is just about up, so why don't I go
ahead and yield to my colleague, and then I will have more
questions after he and Mr. Poe ask their questions.
Mr. Engel. Okay. Thank you. Thank you, Mr. Chairman.
I just want to say, and again, in the general realm of
knowing that we have got to cut costs and do the best we can, I
just want to go on record again. I have said this many, many
times. I think that the salaries that staff is paid--I travel
around to our Embassies and our consulates; I think it is
pitiful, the work that the personnel do. I think they are
underpaid, and I think if we are going to look for cuts we
should not start with salaries. I think that our men and women
are so dedicated. They certainly don't do it because of the
salary. And it is really embarrassing, I think, what they are
paid. So I understand we need to tighten our belt, but I think
that on the backs of our workers in the Foreign Service and
Embassies, I think is really the wrong way to go. I only
mention it because Mr. Burton just mentioned it.
Let me ask the Kosovo question. Mr. Rosenblum, let me just
do it, because you and I attended a ceremony where we had the
Albanian Ambassador, and Albania presented a check, a
ceremonial check back--$15 million to the U.S. Treasury, which
is returning half of its startup funds to the American people.
I was interested that you said that you don't believe that any
country that gets aid is entitled to that aid in perpetuity;
that there is a purpose for that aid, and once a country has
succeeded in that purpose, then we move on.
Obviously, Albania, when I was growing up, was the most
repressive Communist dictatorship, far beyond the Soviet Union
and every other place, in fact, in line with China early in the
fifties, and then broke with China because China was too
liberal for it.
What I find amazing, first time I went to Albania was back
in 1993, there is a large Albanian American community in New
York. And I became very friendly with that constituency and
worked very hard with them. Went to Albania, didn't know what
to expect. And I could not believe there are no--there is no
more pro-American country or more pro-American people than
Albanians, both in Albania and in Kosovo. They truly love our
country. And when Kosovo declared independence, there were more
U.S. flags in the street than there were either Albanian or
Kosovo flags.
I mean, that is how they feel about the United States. They
never believed the 50 years of garbage that the dictatorship
told them about the United States. And it is just amazing. And
the warmth really just makes you feel good. And it really is
contagious.
So I believe it would be nice to establish an Enterprise
Fund for Kosovo. Again, I mentioned that we had heard that
there were no startups for Enterprise Funds. We are working on
one for Egypt, supposedly. I know funds are tight. But I think
there is no place more deserving of an Enterprise Fund where
one can play a more useful role. And I understand that the
Albanian American Development Foundation, which is the private
follow-on to the Enterprise Fund, might be willing to
contribute a portion of its huge endowment to start up a Kosovo
American Enterprise Fund. So will State and USAID support the
creation of a Kosovo American Enterprise Fund?
Mr. Rosenblum. Congressman Engel, first of all, we agree
completely about the importance of supporting enterprises in
Kosovo, finding ways of promoting economic growth there. I
think that country's survival as a sovereign state depends on
being able to generate economic growth. And they obviously have
some major obstacles to achieving that goal.
The Enterprise Fund method, the tool of that is one way to
do that. And I would be glad to come and discuss with you more
specifically about the pros and cons of the model and how it
would be done. We have been looking at it together with our
Embassy in Pristina, and we can talk about the other things
that we are doing to promote private sector development and how
an Enterprise Fund may fit into that.
I would note that there might be some legal issues that
would have to be dealt with concerning the use of these funds,
because they are previously appropriated funds, the funds that
belong to the Albanian American Development Foundation. We
would have to examine that. But we value this kind of creative
suggestion and will seriously consider it.
Mr. Engel. Good. Why don't you come in and we will chat
about it? I would be very, very interested.
And I wanted to say that in terms of foreign assistance in
general, Defense Secretary Gates and the U.S. Chamber of
Commerce, which is Republican-leaning, all support foreign
assistance and support increases, I think, in the President's
budget in terms of foreign assistance. So I believe that it
plays off well in terms of helping us in America.
I would like someone to tell me about Russia. I think, Mr.
Rosenblum, you had said in your testimony that these
authoritarian regions, former Communist regions, have a way of
slipping backwards into more autocracy. That is kind of what
they are used to. That is why I truly believe it is so
important for us not to leave a vacuum, to be in there and to
fight for things.
I would like to know about Russia. How has our assistance
to Russia contributed to the reset or targeted assistance? Has
it improved our bilateral relationship? And I would also like
to throw in there, the State Department human rights report
identified Uzbekistan, Turkmenistan and Tajikistan as
authoritarian states. A new report singled out countries for
incarcerating people on political grounds, lacking fair
elections, obstructing a multiparty system, and on and on and
on. So I would like to hear some talk about Russia and these
other countries.
Mr. Rosenblum. Glad to talk about it, sir. And I will defer
to Ms. Elliott on the question about Central Asia. But with
respect to Russia, our policy on Russia now is premised on the
idea that we can be doing two things at once; that is, finding
areas of common interests, common concerns with Russia where we
can work together and actually achieve significant results, but
at the same time, knowing that there are areas where we
disagree, and where we can be direct and frank in addressing
the issues.
The issues that you talked about in terms of democracy,
backsliding on democracy, apply there; and another issue is
Georgia, where we definitely have a major disagreement with
Russia on that.
We think that this policy has paid dividends. We think we
can point to a number of areas, and I won't go into all of them
now in detail. I think Assistant Secretary Gordon talked about
this when he appeared before you several weeks ago. But with
respect to Iran, with respect to North Korea, nonproliferation,
counterterrorism, and other areas, and in a very practical way
some of this collaboration is paying off, and this connects to
the assistance, because one of the areas where we do work with
Russia and where some of the assistance money is going, is
counternarcotics. Obviously, a huge problem of the flow of
heroin coming out of Afghanistan. It is important to work with
all countries of the region. Russia itself is very directly
impacted by this; in fact, in terms of their own drug abuse
problem--and we have had very good cooperation on this issue
and have used our assistance programs to support it.
Most recently, there was a major seizure of about a ton of
heroin in Afghanistan, an Afghan-led operation, but with
support from the U.S. and Russia working together.
So our assistance has that aspect to it. It works on the
collaborative area. But there is another major portion that is
actually the majority, in dollar terms, of our assistance to
Russia that is focused on the areas of democracy and human
rights. It is about supporting civil society, supporting
independent media, working on rule of law problems, and most of
that, most of those programs, not only are they aimed at those
issues but the funds are being spent to work with
nongovernmental sector; that is, this is not anything to do
with the Government of Russia.
Mr. Burton. We will have more questions.
Mr. Engel. I will ask Ms. Elliott the questions that I
raised, but I will defer.
Mr. Burton. We will come back to you. Mr. Poe and then we
will go back. Mr. Poe.
Mr. Poe. Thank you, Mr. Chairman. I apologize, I am in a
markup in Judiciary, too. So I am going to be short.
I live in Texas, the Houston area. What occurs in Eastern
Europe becomes our problem in the area of human trafficking.
The figure is 50,000 people that are human trafficked out of
Eastern Europe, end up in the United States. Houston, Texas,
has Interstate 10 that goes east to west, which is apparently
the corridor for human trafficking in the United States,
because you can go all the way to Florida and you can go all
the way to California.
I have been to Eastern Europe, have seen and talked to the
people in Romania and Bulgaria about the issue of women,
specifically, being trafficked. I understand that Bulgaria,
Russia, Romania, are all tier two when it comes to trafficking
of people, which I think is despicable. As a former judge, I
would like to try all of the traffickers at the same time, but
they won't let me do that.
But anyway, so I am concerned and my question really is,
since that problem becomes America's problem, what funds are
being used and are they effective in trying to convince
countries--Romania, Bulgaria, and Russia--to get their acts
together and protect human beings in Russia so that they don't
end up being trafficked to the United States and other places?
Mr. Rosenblum, you want to answer that?
Mr. Rosenblum. Sir, I will be glad to start and answer, but
my colleagues may well have things to add to it.
I would say that the starting point has to be political
will in the countries; that is, the countries themselves have
to recognize that it is a real issue and be willing to deal
with it. Sometimes dealing with it has some costs for them,
because they may be going after important people in the country
in terms of prosecutions. So that is always the starting point,
and through our diplomacy, we are constantly engaging and
constantly pushing the issue with these governments. And of
course, the ranking, the tier ranking that you referred to is
an element of that because no country wants to see itself slip
in the tier ranking.
Through our assistance programs, we do have ways that we
can deal with the issue as well, which we are; and we are
spending money in the countries of the region on this issue.
Some of it is working with the victims of trafficking in those
countries, you know, with shelters and providing--sometimes it
is providing employment opportunities so the targets of the
traffickers will have other options, other things that they
will do. And some of it is aimed at helping them--helping the
governments, the justice sectors of these countries figure out
how to prosecute the crime. It is not a crime that they in the
past have been used to treating as its own criminal offense
under their code. So it is a matter of amending the criminal
code.
It is a matter of training judges and training prosecutors,
and we have done a good deal of that in the region, but there
is a lot of work left to do. And we agree completely that this
is a horrendous problem.
Mr. Poe. In your opinion, do you think that Russia has the
moral will to get this crime problem stopped or not? Can you
give me your opinion of that? Political will, whatever kind of
will you want to call it, do you think they do?
Mr. Rosenblum. I think that they have shown a lot of
evidence of that will, that there has been movement.
Mr. Poe. How about Romania?
Mr. Rosenblum. Romania, the same thing in Romania as well.
I mean, there are different elements in the political systems
there that may have different views on it, but in general the
Romanian Government is engaged very strongly with us on this.
Mr. Poe. How about Bulgaria?
Mr. Rosenblum. Bulgaria, I would say the same about
Bulgaria and Romania. Bulgaria and Romania also as members of
the European Union have certain requirements that they have to
meet that are a little different than countries further to the
east do. So I am not going to sit here and tell you that the
problems are solved, because we know that they aren't. We know
that they aren't, and there is a lot of work to be done, but we
see movement in these countries in the right direction.
Mr. Poe. Ms. Alexander, do you want to weigh in on that in
my limited time?
Ms. Alexander. Sure, thank you. I think that as Dan has
recognized, the legal reforms that are necessary to address
this problem are vast, and it is something that we are trying
to conquer. From USAID's perspective, we are also working with
civil society groups in public education because I think those
pieces can make sure these trafficked people or persons are
educated before they end up in Houston, Texas. This is an
element where I think independent media and the reforms that
are addressed through both the legal proceedings, as well as
civil society, are important elements to make sure that people
understand what they are getting into. And this is an area that
I think remains important for engagement and assistance
programming.
Mr. Poe. Thank you very much, Mr. Chairman. I yield back.
Mr. Burton. Thank you, Mr. Poe. I think since my colleague
was not finished with his questions, I will let him take his 5
minutes, and I will ask questions after Mr. Engel.
Mr. Engel. Thank you very much, Mr. Chairman. I would like
Ms. Elliott to answer the questions I was talking about, the
authoritarianism in those four or five countries.
Ms. Elliott. Thank you, Mr. Engel. As I mentioned in my
statement, we conduct Annual Bilateral Consultations with all
the countries of Central Asia, all five, and an integral part
of the engagement we have is discussing democracy, human
rights, freedom of the press, what I would call the human
dimension. So this is something that we take very seriously and
we raise it at high levels.
In fact, Secretary Clinton, when she visited the region in
December, raised these issues with all five of the Central
Asian leaders in a meeting she had. And as well, she visited
Uzbekistan, and this again was an integral part of her
discussion. So we raise these things at high levels, and we
continue to emphasize the importance of them.
Mr. Engel. Ms. Biswal.
Ms. Biswal. Yes. I just want to add, in addition to the
diplomatic efforts, we very much, through our assistance
program, provide support to human rights defenders. We provide
regional support as well as bilateral support to civil society
institutions, and because the political space is so narrow, we
look for creative ways that we can engage and encourage
democratic activities.
Some of it might be creating things like water institutions
or water associations, where at community levels you bring
individuals together to make decisions in a more democratic
way. So we are trying to get at democratic reforms through as
many different ways as we can. If we can't attack a problem
directly at the top, we try to go around through other ways.
Mr. Engel. Thank you.
Ms. Biswal, you still work for our committee. I don't know
if you know that, Mr. Chairman. So she is still doing good
work, your work for USAID.
Let me throw out two countries I would like you to tell me
about. One is Turkey, who I have lots of difficulty with.
Obviously, they are a NATO ally, and some of their very recent
orientations are really disturbing with regard to Israel and
the Middle East, and also with regard to Armenia. I am
wondering if someone can talk to me about that. And the other
country you mentioned before is Georgia. Obviously, there are
differences with the Russians on Georgia, but Georgia being a
pro-Western government and a country that would like to work
with us, what are we doing in Georgia, especially based on the
fact that the Russians have occupied a portion of Georgia?
Mr. Rosenblum. Mr. Engel, maybe I will start and, again,
welcome contributions from my colleagues as well.
To be honest, I don't have too much to say about Turkey,
but I have lots to say about Georgia. And the reason is,
frankly, in terms of assistance, in terms of the budget request
and the assistance, we are doing very little with Turkey. We
still have a significant IMET program, military training there,
to enhance our collaboration with Turkey as a NATO member, but
we we are not requesting any funding for FMF. We have a small
amount of funding that is being requested for the antiterrorism
cooperation programs that we do with countries around the
world, and that is it. That is pretty much it. I see here, it
is a total of $5.6 million between the IMET and this
antiterrorism cooperation.
You mentioned Armenia, and we can talk about that more if
you would like. But let me surf to Georgia for a moment and say
that we were able, as you know, and with a lot of help from
Congress, to step in after the Russian invasion in 2008 and
provide very significant assistance to Georgia which we think--
--we were able to, I think, provide assistance that actually
might have made the difference between Georgia surviving or
collapsing in some ways. The economic situation was dire in the
fall of 2008 after the Russian invasion, and we provided a very
large package of assistance, including the type of assistance
that we very rarely do, and in this part of the world it is
almost unheard of in my experience, and that is budget support.
We actually provided some budget support.
Mr. Engel. Are we still doing that in a consistent way or
have we backtracked?
Mr. Rosenblum. We are not doing budget support anymore.
That was a one-time thing. We are still providing a significant
amount of assistance to Georgia. I think this year the request
for Georgia totally is $87.6 million, and what we are doing
with that money is supporting reform. The Georgian Government
is very serious about reform in the economy, reform in their
political institutions, in their social sector. And this is one
of those cases I think that the chairman referred to as like-
minded countries that we can support their reforms. Georgia has
been a model in that respect. So we think the money there is
well-invested.
We also, as you know, had until recently--actually, I think
it is still in place--a major Millennium Challenge compact in
Georgia that was working on rural development and roads and so
on.
Mr. Engel. Can I ask one final question, Mr. Chairman? When
you come and talk about the Kosovo fund, then you can talk to
me about Armenia as well, because I am very concerned and would
like very much to help Armenia in any way we can.
There are 300,000 refugee and internally displaced persons
in the Balkans, 100,000 displaced in Georgia, 160,000 persons
in Turkey, and an untold number of stateless persons in Eastern
Europe and Central Asia; yet, the President's budget for
migration and refugee assistance in Europe and Central Asia is
slated to decline from $48 million to $29 million. UNHCR budget
for Europe alone is $196 million for 2011. The Department's
total 2012 request for Europe doesn't come close to
contributions to the U.N., and I have a lot of questions about
the U.N.; but you know, in fact, if the entire amount would
come to the U.N., it would come under 15 percent, and we assume
it doesn't all go to the U.N.
So my question really is, just as some of these countries
are beginning to make progress, are we pulling out the rug from
under their feet, and if it is appropriate to end programs,
what do we do? Shouldn't we be pumping up assistance to Bosnia
to end another 2 years of other displacement? Those questions,
similar.
Mr. Rosenblum. Should I respond?
Mr. Engel. Sure.
Mr. Rosenblum. On that point, Congressman, as I said in my
opening statement, there is a lot that we are balancing here in
terms of being very aware of the fiscal constraints, but at the
same time wanting to sustain commitment to the kinds of goals
that you mentioned in this region.
What we have tried to do to respond to that is to really
focus on the highest priorities. And there have been a few
cases where we have had to stop programs in order to shift
those resources into things that are really important. Ms.
Alexander referred to one of them in her testimony with respect
to Montenegro, where we had a program aimed at economic growth
in Montenegro for many years. We felt that it reached a point
where that program could be phased out.
The real issues that need to be focused on in Montenegro
now, in our view, relate to rule of law. There is still a major
problem with rule of law, with organized crime operating in the
region, et cetera. So what we have done is, we have reduced the
budget for that country and focused in on the rule of law
issues, and this is true in other places in the region as well.
So it is a difficult challenge, but we are trying to make the
best of it and keep that progress going.
Mr. Engel. Thank you.
Mr. Burton. More than 56 national and 260 multilateral aid
organizations contribute to development resources. New donors
are emerging all the time. China, India, Brazil, Taiwan, and
Russia collectively contribute about $8 billion each year. What
troubles me is, why are we giving money, aid, to these
countries that are collectively giving $8 billion in aid to
other countries? I mean, we give money to India, we give money
to Brazil, we give money to Russia, and I just can't understand
why, when we are having the fiscal problems we are having right
now, we would be contributing to these countries, who in turn
are contributing money to other countries.
Ms. Biswal. I would like to maybe talk to you a little bit
about India and why we have an USAID program there. I think it
is a very fair question, what is USAID and what is U.S.
assistance doing in India at a time when India is emerging much
more significantly in the world scene as a donor.
Mr. Burton. But the point is, if we are giving them money,
then they need the money for various USAID programs. So how can
they contribute to other countries when we are giving our
money? It sounds like a transfer of funds, and I don't
understand why we should be giving money if they have their
money being given to other countries.
Ms. Biswal. Well, in the case of India what we are trying
to do is--and India still has 800 million people living in
poverty--but what we are trying to do is not necessarily--I
mean, India is going to have to solve its own problems of
poverty. But what USAID can do, and what we are increasingly
trying to gear our programs toward, is working with India to
pilot some effective solutions that they can scale up, but not
only that they can scale up, but in partnering with them as
donors to take Indian-piloted solutions and apply them to
challenges in Africa.
So when the President was in India last November, he
announced a partnership for an evergreen revolution with Prime
Minister Singh, and that is basically what is at the heart of
this.
Mr. Burton. I understand what you are saying, but there is
a host of countries that are contributing foreign assistance to
other countries and we are giving them money. It just seems
like to me that is one of the things that ought to be looked at
very closely, especially when we are in a situation like we are
economically.
And a while ago we were talking about salaries. I am not
cutting people's salaries and putting you in bread lines or
anything like that, but all I am saying is every single aspect
of our expenditures needs to be parsed and looked at very
closely. Some need to be changed, some need to be cut, but we
cannot go on the way we are going, and that is why foreign
assistance is also one of the things that we have to look at
very closely.
Now, there are 56 OSCE members. Could you elaborate on the
potential expansion of the role of the OSCE in Central Asia and
Afghanistan and what would this expansion role entail and what
funding would it call for and which countries would contribute
to these funds out of the 56?
Ms. Elliott. Well, I can just say that the OSCE is already
active in Central Asia, and, as you probably are aware, that
Kazakhstan was the chairman in office of the OSCE. They have
worked in Kyrgyzstan and other countries in Central Asia. I
can't tell you specifically how much each member country
contributes, but that is certainly something we could find out
and get back to you with.
Mr. Burton. Okay. That would be helpful.
We are running out of time because we have votes on the
floor. So what I will do is, I will ask one more question, and
then I would like to, with unanimous consent, submit a number
of questions to you for the record that I, and my staff, and
your staff can take a look at after the meeting is over;
because I don't want to go vote and then keep you guys here
until 6 or 7 o'clock, because you probably have dinner dates
and things that you have to do.
Let me ask you about corruption. Transparency International
measures the level of corruption perception worldwide. Now, we
give $123 million to the Ukraine while the Transparency
International, which measures corruption, rates it 134th out of
178 countries assessed. So they have got a real corruption
problem, and yet they are getting $123 million from us.
Tajikistan is getting $48 million. It ranks 154th. Russia gets
$65 million.
And I just would like to know why, when the corruption
level is so high, we are giving large amounts of money to these
countries, as well as others, and why is Russia getting any? So
if you want to answer that question real quick, then we will
submit the rest for the record.
Ms. Alexander. I will start on Ukraine, because I think
that Ukraine was disproportionately affected by the global
economic crisis, and the corruption element really requires
political will. So when you have a global economic crisis that
is crashing a country and you have a lack of political will,
there is a need to help because that will actually affect and
have a snowball on the region.
Mr. Burton. But the one thing that none of us want is for
us to give aid and then, because there is no political will, it
ends up in a Swiss bank account. We have had an awful lot of
countries around the world, and I experienced it because I was
in Zaire when they had Mobuto over there, and he was getting
billions of dollars and it was all in a Swiss bank account or
in the French Riviera.
If we are going to give aid, we want to make sure it is
going for a purpose. And if there is political corruption we
can't deal with, it seems to me, unless we can go through a
private agency that is not connected to the government, we
shouldn't be giving them any money.
Ms. Alexander. Part of this is addressing the political
will of the players, but it is also the legal and regulatory
reforms that you have in these countries. And when you don't
have those systems set up, these things can happen.
And so I think that there have been incomplete market-
oriented reforms that have limited the ability of the
politicians to actually conquer this political will that is
necessary to address the corruption issues. So through
Transparency International, through a lot of our technical
assistance in these countries, we have actually been
shepherding some of these programs through. I know in Central
Asia, too, corruption is an issue that Nisha----
Ms. Biswal. And I just want to assure you, Mr. Chairman,
that while we may have assistance programs in countries where
corruption is a major concern, U.S. assistance dollars, we are
not providing budget support to these countries. We are not
providing U.S. funds directly to governments. We are only
providing technical----
Mr. Burton. What is it, going through PVOs?
Ms. Biswal. We are going through private voluntary
organizations, nongovernmental organizations. We are also going
through U.S. contractors who are undertaking a lot of the
programs on our behalf, and so we are not providing assistance
to governments, and we take very strong measures of
accountability to track U.S. resources.
Mr. Burton. Well, what I would like to do is, in addition
to submitting these questions for the record, because we are
out of time and we don't want to keep you, if you could give us
some idea of how you police this; because I was senior
Republican on Africa for 10 years, and the money we were poring
into Zaire and a whole host of countries, South Africa and
elsewhere, was going right down--pardon my expression--the rat
hole. And when we are talking about the fiscal problems we have
right now, we can't allow that to happen, or at least keep it
to a minimum.
So with that, I just say thank you very much. We will
submit these questions for the record, and I really appreciate
you being here today.
Thank you very, very much. We stand adjourned.
[Whereupon, at 4:17 p.m., the subcommittee was adjourned.]
A P P E N D I X
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