President’s FY 2009 International Affairs Budget Request

(10:25 a.m. EST)

SECRETARY RICE: Thank you very much, Chairman. I would first like to thank the Committee. This is indeed the last budget that I will present to you as Secretary of State. I want to thank you, Mr. Chairman, I want to thank the ranking Mr. Lugar and all the members of the Committee for what I think we have achieved together over the last several years. I’d also like to take just a moment to say how much Congressman Tom Lantos will be missed. He was of course a northern Californian, someone that I knew very well. I feel that I’ve lost an inspirational mentor and I’ve lost a good friend. And when I testify today for House Foreign Affairs, it will be a sad moment to see him not sitting there. He was a true American hero and I think embodied the best of our country.

I want to thank you very much for what we have been able to do together. I have a full statement, Mr. Chairman, but I’ll just have that entered into the record and I’d like to -- with your permission.

CHAIRMAN BIDEN: Without objection, the entire statement will be placed in the record.

SECRETARY RICE: Thank you. I’d like to just mention a few highlights of what I think we’ve been able to do together and then to address three questions that came up in the remarks that you and Senator Lugar have made. The first is I’d like to thank you very much for the support of this Committee in significantly increasing foreign assistance during this Administration. Really foreign assistance had been essentially flat-lined for almost two decades and it was time for the United States to do more. We have been able with your help to double foreign assistance for Latin America, to triple it worldwide, and to quadruple it in Africa. That includes, of course -- and it also has been helped by the development of the HIV/AIDS PEPFAR initiative which you mentioned, Senator Biden, as well as the development of innovative approaches in foreign assistance, like the Millennium Challenge Corporation. I think it has been a good story. If I could say one thing from a point of privilege, I hope that it will continue into the future because we have learned that as important as development assistance is, foreign assistance is because of our moral obligation to help those who are less fortunate. It is also critical to our national security. We have seen what happens when states are failed states, when they are unable to deliver for their people and we have both an obligation and an interest in having well-governed democratic states that can deliver for their people, that can fight poverty, that can defend their borders. And I think foreign assistance is our most valuable tool in doing so.

Secondly, I’d like to thank you very much for the support that you’ve given to the Department as we’ve tried to transform the Department into one that is capable of taking on the myriad challenges that we face. We are sending diplomats, fine civilians into places that diplomats didn’t used to go. And I want to take a moment to thank the men and women of the Foreign Service, the Civil Service, and especially our Foreign Service Nationals for their willingness to serve in extremely difficult places and difficult circumstances. We’ve tried to give them new tools. We tried to develop new ways of doing this -- the Provincial Reconstruction Teams, for instance, in Iraq and Afghanistan – that, in effect, marry us with our military counterparts because really, while the military can buy time and space, it is really civilians who have to help these people and these governments build governance structures, nongovernmental institutions, rule of law, justice, and functioning economies. And I think that the Provincial Reconstruction Teams will also live on as a way to think about post-conflict operations.

I’m especially pleased that we have made the budget request for the Civilian Response Corps. To be very frank, I think we tried in Afghanistan to deal with counterinsurgency and reconstruction through a kind of international effort. I’ll be very frank, it was kind of adopt-a-ministry by each country for capacity-building. It was very good to have so many countries involved. I’ve seen those efforts. But it also has led to some incoherence with which we are still dealing and I will make a comment about that when I turn to Afghanistan.

And then in response in Iraq, we tried the single U.S. Government department; the Department of Defense took responsibility, but I think did not – was not able to fully mobilize the range of capabilities that were needed. There was no single U.S. Government institution or agency that was capable of doing that.

I think that under the State Department, with a Civilian Response Corps, we would be better capable of getting the city planners and the justices and the lawyers and the health experts out into the field to help countries recover in post-conflict situations. And it’s not just the large ones like Iraq or Afghanistan, but Haiti or Liberia or the many places that have to develop.

And I thank you for the innovation of the Civilian Response Corps for the work that you and Senator Lugar and Senator Hagel have done. And I sincerely hope that we can get it stood up and really working. It is probably one of the most important things that we can do as the United States Government.

I want to thank you also for the support of increases in public diplomacy. When I first testified before this Committee for my confirmation hearings, I said that we would try and increase the resources to public diplomacy. This is a long-term prospect. It’s not something that is going to take hold overnight. But we’ve increased dramatically the number of exchanges. We have record numbers of foreign students studying in the United States now. I think we’ve overcome some of the difficulties of the post-9/11 period when we really did have to think hard about who was coming into the country, but where we were in danger of sacrificing one of our best long-term tools in improving the understanding of the United States and respect for it; that is, people who come here and study and go back to their countries to be leaders. And I’m very grateful that we’ve been able to rebuild that function. There’s much more work to do. And I’m sure that Jim Glassman, as he replaces Karen Hughes, will put energy into that.

I would also like to note that there is a request for a substantial increase in the number of Foreign Service officers and USAID officers, roughly 1,100 in the Foreign Service and 300 in USAID. We’re just very small, and on many occasions I’ve been asked if the State Department could do things. It’s been hard to do it. We have roughly 6,500 professionals worldwide. I believe there are twice as many lawyers in the Defense Department as Foreign Service officers. And while Secretary Powell and the President started the process of rebuilding after the ‘90s with roughly 2,000 over four years, this is another important increment, and I will be counting on your support with the appropriators to make sure that we can this time fully fund the personnel request.

It will be important as a part of that also to do compensation reform so that our people do not lose locality pay when they serve abroad. It is principally our younger officers that suffer from that disparity, and we will press again for compensation reform. I say all of this because it has been an extraordinary period for the United States in which we've been taking on challenges -- and difficult challenges -- that I think perhaps none of us could have fully foreseen in 2001. It has required us to make some difficult decisions. We have not always agreed about those decisions, but I think that we have always done it in the spirit of our great democracy, which is one that recognizes that people can disagree and still be patriots, that recognizes that we must always support our men and women in uniform as well as our civilians abroad. We have much work to do in the remaining 11 months and I want to ensure you we will sprint to the finish. We -- the United States of America cannot afford any less.

In that regard, let me just say briefly on Iraq and Afghanistan, and then perhaps a comment on the energy issue. It has been difficult in Iraq, but I do believe that not only are we starting to see security improvements, but we're starting to see the Iraqis rebuilding their country and developing a young political system to deal with their differences. I would just note that reconciliation is taking place from the bottom up, of course, with provincial councils and local councils that are working with an Awakening Movement, not just in Anbar but efforts to spread it to the southern part of the country, with frankly, Senator Biden, as we've talked, a pretty decentralized structure, which I think is probably best for a country as complex as Iraq. The local citizens committees that are coming out to defend their territory are coming out not unlike a tradition that we've had in our own country for people to defend that which is nearest to them, which is their neighborhoods and their districts.

The political progress that we're seeing at those local levels -- and I will say I sat with the Kirkuk provincial council and watched Kurds and Arabs trying to overcome their difference through political dialogue -- but those local efforts are starting to have an effect on the national level. Frankly, I think we thought that it would be the national level downward. In some ways it's been the local level upward that has put pressure on the Iraqi national leaders to be responsive. And thus, they have passed in recent months a pension law, an investment law, a justice and accountability law; in other words, a de-Baathification reform, just today a provincial powers law setting a date for provincial elections to take place during the fall, a general amnesty which is very much welcomed by the Sunni population, and a 2008 budget which has significant increases for provincial governments, for Iraq's own security forces and a capital budget that also has a significant provincial element.

So it is hard work. It is harder work perhaps than we thought when we began this enterprise, but they are going about the business of building a political structure. That is welcome among their neighbors. We are seeing Arab states begin to engage with them. The Saudis have said that will put a diplomatic mission there, as well as others. The Russians have now forgiven on Paris Club terms some 90 percent of the Iraqi debt. And we will have – I’ve just accepted the invitation of the Kuwaiti Government to hold the third Iraqi expanded neighbors conference toward the end of April. So I believe that we see progress on all fronts, although it is fragile and there is still much work to do.

If I may, just one word on Afghanistan. I was just there. I was in both Kabul and in Kandahar. It is quite clear that militarily there are battlefield successes against the Taliban that, quite frankly, doesn’t do very well, when it comes at the coalition forces or our forces in military type formations and has therefore gone to hit-and-run tactics to suicide bombings, to trying to terrorize the population. And I had extensive discussions there about the importance of refocusing on population security and the importance of building police forces and local citizens forces that can after an area has been cleared by coalition forces hold the territory so that building can take place.

And I just want to say that there’s been a lot of attention to NATO in the south and can we get more NATO forces in to help the forces that are fighting there -- the Canadians, the Danes, the British, the Dutch. And they deserve to have the help that they have asked for. And Bob Gates and others are working very hard on that. But I also saw reconstruction efforts that frankly are not as coherent as they need to be. And we are searching now for an envoy who can help to bring coherence to that international effort because we now understand that in counterinsurgency you have to defeat the enemy, keep him from coming back and then give the population reason to believe in a better future. I believe that the Afghan project is making progress. The situation is better than some reports. It is not as good as it needs to be. And I am – we are paying a lot of attention to improving the circumstances in Afghanistan.

Let me say just finally, Senator Lugar, on the energy piece and I’ll be very brief. I agree with you, it is a really important part of diplomacy. In fact, I think I would go so far as to say that some of the politics of energy is warping diplomacy in certain parts of the world, and I do indeed intend to appoint and we are looking for a special energy coordinator who could especially spend time on the Central Asian and Caspian region.

Thank you very much.

2008/107

http://video.state.gov/?fr_story=7c5939804bfdf6620221dbcb7835222e00d9c742