U.S. Department of State

CHAIRMAN LEAHY: (In progress.) – commending the Secretary for unbelievable energy not only in the work she does at the State Department, but around the world in representing the United States, and to add to that, that amazing energy. I understand this is one of four times you’re going to be testifying here on Capitol Hill, and we appreciate it very much, Madam Secretary.

The President’s Fiscal Year 2011 Budget Request to the Department of State and Foreign Operations totals 56.6 billion. It’s a 10.6 percent increase over last year. Most of the increase is for three countries – Afghanistan, Pakistan, and Iraq. For the remainder of the world, the increase is about the rate of inflation. And as the President pointed out, the total request for Foreign Operations is about 1 percent of the entire federal budget. If we cut all these programs, it wouldn’t make a dent in our deficit, but it would cause many other problems around the world, especially as it affects America’s leadership position.

The funds are all we have besides U.S. military to protect the security and other interests of the American people in an increasingly dangerous and divisive world. Now, that’s not to say we can’t do more to get full value for our tax dollars. That’s always been mine and Senator Gregg’s goal on this committee. And if there are programs that are not effective or are no longer necessary, then of course, we will eliminate them. And, I would add, as we listen to the complaints about broken government or paralysis in Washington, this is a bill that, over the past number of years, has had overwhelmingly bipartisan support. So if anybody wants to see whether bipartisanship still exists in Congress, I don’t think you have to look any further than this subcommittee.

Every member of this panel, Republican and Democratic alike, has a stake in what’s in here, and we work together. And for the benefit of those who question the need for these funds, talk about global health, preventing outbreaks of deadly viruses and other infectious diseases, they’re only a plane ride away. And if they spread, become pandemics, they can kill millions of people, including Americans. And then topping the list is the continuing need to stop terrorism, organized crime, other transnational crime, their growing threats to Americans, and the citizens and governments of other nations, especially governments whose institutions are prone to corruption, and many other examples. I’ll put my full statement in the record.

And we know this budget’s not going to solve every problem in the world, but at least ensures the U.S. is equipped to play a leadership role. The Secretary’s done her part in going around the world. And Madam Secretary, I must say I appreciate the fact that you have been the face of America in every single part of this world. I think it’s important. I know that it is physically strenuous, both for you and your staff, to go to these parts of the world. But it is important that you’re there and that people see America. And today, more than ever, we appreciate the need for fully staffed and secure embassies, effective diplomacy, strong alliances. I want to commend the dedicated men and women of the State Department and USAID who are serving America not only here at home, but at posts around the world, and I should note, often at great personal risk.

So after Senator Gregg makes his opening remarks and the Secretary testifies, we’ll have seven-minute rounds for questions. Senators will be recognized in order of arrival, alternating back and forth. Senator Gregg. And I apologize for the voice. It’s a little bit too much speaking in Vermont last week.

SENATOR GREGG: Thank you, Mr. Chairman. And I want to second your opening comments. I especially want to pick up where you left off, which is saying thank you to not only yourself, Madam Secretary, but the extraordinary staff that works for you at the State Department.

Those of us who have had a chance to travel to some more severe regions in this world such as Afghanistan, Syria, Pakistan, of course, Iraq recognize that the men and women who serve us in the State Department are on the front lines and doing an extraordinary job of trying to carry out American policy and assist those nations in moving towards more democratic forms of government, and basically to be constructive citizens in the world. And they put their lives at risk, as our military people do, and we very much appreciate their service.

I also want to thank you personally for what you’re doing. I think your presentation around the world has been extraordinary and has been very positive for us, for our nation, to have you out there as our spokesperson, along with the President, of course.

There are so many areas of concern that come to mind. And rather than taking them all up in my opening statement, I’d rather hear your thoughts on them, so I will turn to you. But I just want to highlight one that doesn’t get a lot of attention, and that is an issue I’ve had interest in for almost 15 years now, which is to make sure that you have the best technology and the best capability so that the support is there for the people that – who do such wonderful things for us in the field. And I’d be interested in your thoughts on where we stand in that area.

And also in the area of facilities, it’s – potentially want to spend some time on that. I’m especially concerned about the cost of the Iraqi mission and the new building and the complex there and how that’s going to drain away funds from other initiatives. So I’d rather hear from you than talk myself, so I’ll turn it over to you, Madam Secretary.

CHAIRMAN LEAHY: Thank you. Secretary Clinton, please go ahead.

SECRETARY CLINTON: Thank you very much, Chairman Leahy and Senator Gregg and members of the subcommittee. It really is a pleasure to be back here in the Senate and to be with all of you today. When I was last here to discuss our budget, I emphasized my commitment to elevating diplomacy and development as core pillars of American power. Since then, I have been heartened by the bipartisan support of this committee and the rest of Congress. And I want to take this opportunity to thank you, on behalf of the men and women who work every day around the world at the State Department and USAID who put our foreign policy into action. And I will certainly convey the very kind words of both the Chairman and the Ranking Member to them.

The budget we are presenting today is designed to protect America and Americans and to advance our interests and values. Our fiscal year 2011 request for the State Department and USAID totals $52.8 billion. That’s a $4.9 billion increase over 2010. Of that increase, $3.6 billion will go to supporting efforts in “frontline states” – Afghanistan, Pakistan, and Iraq. Other funding will grow by $1.3 billion, and that is a 2.7 percent increase, and with that money we will address global challenges, strengthen partnerships, and ensure that the State Department and USAID are equipped with the right people, the right technology, and the right resources.

Over the past six weeks in Haiti, I have been reminded again of the importance of American leadership. I am very proud of what our country has done. We will continue to work with our Haitian and international partners to address ongoing suffering and transition from relief to recovery.

I am also well aware that this is a time of great economic strain for many Americans here at home. As a former senator, I know what this means for the people you represent. For every dollar we spend, we have to show results. That is why this budget must support programs vital to our national security, our national interests, and our leadership in the world, while guarding against and rooting out waste, redundancy, and irrelevancy. I believe this budget achieves those goals.

These figures are more than numbers on a page. They tell the story of the challenges we face and the resources we need to overcome them.

We are fighting two wars that call on the skill and sacrifice of our civilians as well as our dedicated military troops. We have pursued a dual-track approach to Iran that has exposed its refusal to live up to its responsibilities and helped us achieve a new unity with our international partners. Iran has left the international community little choice but to impose greater costs and pressure in the face of its provocative steps. We are now working actively with our partners to prepare and implement new measures to pressure Iran to change its course.

We have achieved unprecedented unity in our response to North Korea’s provocative actions, even as we leave the door open for a restart of the Six-Party Talks. And we are moving closer to a fresh nuclear agreement with Russia – one that advances our security while furthering President Obama’s long-term vision of a world without nuclear weapons.

With China, we are seeking areas of common purpose while standing firm where we differ. We are making concrete our new beginning with the Muslim world. We are strengthening partnerships with allies in Europe and Asia, with our friends here in our hemisphere, with countries from those that are rising and emerging powers to those who have challenges. And we are working hard every day to end the impasse and the conflict between Israelis and Palestinians.

At the same time, we are developing a new architecture of cooperation to meet transnational global challenges like climate change, the use of our planet’s oceans, proliferation of weapons of mass destruction, health problems – which, as the Chairman said, are no respecter of boundaries. In so many instances, our national interest and the common interest converge, and so from our hemisphere across the world, we are promoting human rights, the rule of law, democracy, internet freedom; we are fighting poverty, hunger, and disease; and we are working to ensure that economic growth is broadly and inclusively shared.

Now, our agenda is ambitious, I admit that, but I think the times demand it. America is called to lead – and we need the tools and resources to exercise our leadership wisely and effectively. We can bury our heads in the sand and pay the consequences later, or we can make hard-nosed, targeted investments now – addressing the security challenges of today while building a more lasting foundation for the future.

Let me just highlight three areas where we are making significant new investments.

First, the security of frontline states.

In Afghanistan, this past year, we have tripled the number of civilians on the ground, and this presence will grow by hundreds more with the $5 billion in this budget. Our diplomats and development experts are helping build institutions, expand economic opportunities, and provide meaningful alternatives for insurgents ready to renounce violence and al-Qaida and join their fellow Afghans in the pursuit of peace.

In Pakistan, our request includes $3.2 billion to combat extremism, promote economic development, strengthen democratic institutions, and build a long-term relationship with the Pakistani people. This includes funding of the Kerry-Lugar-Berman initiative. Our request also includes a 59 percent increase in funding for Yemen, to help counter the extremist threat and build institutions there as well.

In Iraq, we are winding down our military presence and establishing a more normal civilian mission. Our civilian efforts will not and cannot mirror the scale of the military presence, but they rather should provide assistance consistent with the priorities of the Iraqi Government and the United States. So our request includes $2.6 billion for Iraq. These are resources that will allow us to support the democratic process, ensure a smooth transition to civilian-led security training and operational support. These funds will allow civilians to take full responsibility for programs, and the Defense budget for Iraq will be decreasing by about $16 billion – and that’s a powerful illustration of the return on civilian investment.

We are blessed, as we all in this room know, with the best troops in the world, and we have seen time and time again in today’s wars. But we also need to give our civilian experts the resources to do the jobs we’re asking them to do. And this budget takes a step at the right direction. It includes $100 million for a State Department complex crisis fund – replacing the 1207 fund which the Defense Department used to direct money toward crisis response. It also includes support for the Pakistan Counterinsurgency Capability Fund, which previously fell under the Defense Department as well.

The second major area is investing in development. So we’re making targeted investments in fragile societies – which, in our interconnected word, bear heavily on our own security and prosperity. These investments are a key part of our effort to get ahead of crises rather than just responding to them.

The first of these is in health. Building on our progress treating HIV, malaria, and tuberculosis, our Global Health Initiative will invest $63 billion over six years, starting with $8.5 billion in FY11, to help our partners address specific diseases and build strong, sustainable health systems.

The Administration has also pledged to invest at least $3.5 billion in food security over three years, and this budget includes a request for $1.6 billion, of which $1.2 billion is funded through the State Department. This will focus on countries that have developed effective, comprehensive strategies, where agriculture remains central to prosperity and hunger is widespread.

On climate change, we’ve requested $646 million to promote the United States as a leader in green technology and to leverage other countries’ cooperation – including through the Copenhagen Accord, which for the first time brings developed and developing countries together. This is part of the Administration’s total request of $1.4 billion to support core climate change activities in developing nations.

Our request also includes $4.2 billion for humanitarian assistance. Our efforts in Haiti have made clear that State and USAID must be able to respond quickly and effectively.

But we believe these initiatives will enhance American security, and they will help people in need, and they will give the American people a strong return on this investment. Our aim is not to create dependency, but rather to help countries learn to fish, as the old proverb tells it. And what we want to do is focus on equality and opportunity for women and girls, because we know that is the key driver of economic and social progress.

And then finally, our third area of investment. None of what we intend to do can be accomplished if we don’t recruit, train, and empower the right people for the job.

The State Department and USAID are full of talented and committed public servants, but we have too often neglected to give them the tools they need to carry out their missions on the ground. And rather than building our own expertise, we have too often relied on contractors, sometimes with little oversight and often at greater cost. This budget will allow us to expand the Foreign Service by over 600 positions, including an additional 410 for the State Department and 200 for USAID. It will also allow us to staff the standby element of the Civilian Response Corps, which is a crucial tool in our efforts to respond to crises.

Now, while deploying these personnel generates new expenses in some accounts, it will reduce costs by changing the way we do business. As we are ending our over-reliance on contractors, we’re actually showing we can save money, plus bringing these functions inside and improving oversight and accountability.

So, Mr. Chairman and Ranking Member and members, one thing should be clear from this budget: The State Department and USAID are taking a lead in carrying out the United States’ foreign policy and national security agenda. As we finish the first-ever Quadrennial Diplomacy and Development Review, we have a unique opportunity to define the capabilities we need and to match resources with priorities. This budget aligns our investments with the strategic imperatives of our time.

The QDDR will also help ensure we are more effective and accountable. As I have reported to you before, filling the first-ever Deputy Secretary of State for Management and Resources with Jack Lew, a former OMB director, has given us an extra advantage in developing this budget and reviewing it to make sure that every item is economical and effective.

Now, at this time of change and challenge around the world, we need to make these investments. And I believe that this committee understands why. I look forward to your questions.

But even more so, I look forward to working with you in partnership in the months and years ahead.

Thank you, Mr. Chairman.

CHAIRMAN LEAHY: Thank you, Madam Chair – Madam Secretary. And I – let me go first to an area of the world that concerns all of us, and that’s Iran. We know that the Iranian people have relied on the internet and satellites to get news, sometimes – often of the outside world, but sometimes even of what’s going on in their own country. Now it turns out that the Iranian Government has spent millions of dollars to block internet and social media connections inside of Iran. To me, that’s a sign of a people – a sign of a regime afraid of their own people. They – and they want to hide their actions from the rest of the world.

In an earlier time, oppressive regimes trapped their people behind an iron curtain. The Iranian Government is trying to muzzle its people behind an electronic curtain. And I’m troubled by their – what they’re doing not just for their own people, but when they jam like this, they’re also stopping programs from other countries. You had a recent address, which I thought was superb, at the Newseum, spelling out principles of global internet freedom for the benefit of people everywhere. And that was well received around the globe. But what do we do here? It appears that Iran has broken international agreements in doing this. Is that correct?

SECRETARY CLINTON: Yes.

CHAIRMAN LEAHY: Well, we have worked with the State Department and others. Beginning in Fiscal Year 2008, we provided funds to facilitate internet communications by people around the world in ordinary societies. We stand with them.

I noticed an article in the Washington Post February 18^th that mentioned the National Security Council discouraged the Broadcasting Board of Governors, the board that oversees the Voice of America and other U.S. international broadcasters, from signing a statement with the BBC and Deutche Welle denouncing Iranian jamming of their broadcasts because they were blocked as well as VOA. In the end, VOA ended up signing that statement. Is there disagreement in the Administration of the need to strongly protest internationally this violation of international agreements by Iran?

SECRETARY CLINTON: Mr. Chairman, there is no disagreement. As I said in my internet freedom speech, the development of new tools that enable citizens to exercise their rights of free expression and virtual assembly, because I think it’s rooted in both, needs to be protected and advanced. And we need these new tools, particularly in Iran, but not only in Iran.

So the State Department is looking very closely at what more we can do to try to work with the private sector in partnership to unblock the internet, to get information flowing, to speak out against the kinds of abuses that we see going on out of internet. We are providing funds to groups around the world to make sure that these new tools get to the people who need them. We are – we’ve been assisting in those areas for some time, and thanks to this subcommittee, which has helped to pioneer the funding for these efforts.

But there’s so much more that we can and should do. And inside the State Department, I’ve created a group of young, tech-savvy diplomats. We’re doing what we call 21^st century statecraft. And they are working, again, as I say, with the private sector – this is not all just American Government efforts – in order to be able to un-jam and circumvent with our technologies the kind of blockades that the Iranians are using. There’s still a lot to be done. And I think that the discussion inside the Administration is what are the most effective ways of doing it. Some of the technology, for example, that we would very much like to see used to unblock Iran is very valuable technology. We have to be careful about how it is utilized, so it doesn’t get into the wrong hands –

CHAIRMAN LEAHY: Sure. But we –

SECRETARY CLINTON: – but we’re focused on this, Mr. Chairman.

CHAIRMAN LEAHY: But we also have to be working, I would assume, with other countries if there’s a violation of a bilateral agreement. I’ve heard that some of the things, some of their blocking efforts not only block satellite transmissions into neighboring countries, but in one instance, as far away as Italy.

SECRETARY CLINTON: Right. Well, when they bring down the cell phone networks, that has broad ramifications.

CHAIRMAN LEAHY: Broadband.

SECRETARY CLINTON: Yeah.

CHAIRMAN LEAHY: And the satellite – it’s not just Voice of America.

SECRETARY CLINTON: Right.

CHAIRMAN LEAHY: It’s a whole lot of others. I know we’ve tried to tighten bilateral sanctions against Iran targeting the Revolutionary Guard. We’re seeking the support of Russia and China and other countries for UN sanctions. Are there other things we should be doing? I know the House and Senate has passed legislation imposing sanctions on petroleum companies that do business with Iran. What about that?

SECRETARY CLINTON: Well, Mr. Chairman, we support the purpose and the principles of the bills, both the bill in the House and the sanctions bill that recently was passed by unanimous consent here in the Senate. We want to have as strong a partnership with the Congress as possible. We need to enlist every possible tool that we can bring to bear on this, and we look forward to working with the Congress.

What we’re hoping for is that whatever sanctions emerge from the conference committee have some flexibility that will support our ongoing efforts, because you rightly pointed out we are working very hard with our partners in the Security Council. We’ve already made it clear that we stand ready to do both unilateral and multilateral sanctions on top of whatever comes out of the Security Council. But while we’re in the midst of these negotiations, it would be very useful for us to be in close consultation with the Congress, so that whatever is done here supplements and supports what we’re trying to get done in the Security Council.

CHAIRMAN LEAHY: I’m going to – let us follow up on that in another discussion, just as I will on the request for increase in the economic support fund for Afghanistan, Pakistan, and Iraq. That – I worry about the billions that were wasted in years past because there seemed to be an emphasis on burn rate more than on the results, and I think you and I should discuss that more as we go forward with the bill.

And I will also be talking to you about a group of Vermont high school students who wanted to travel to Cuba to set up a sister school relationship with Cuban students. After doing their own research, getting ready for that and all, they ran into U.S. travel restrictions. You know, I remember – we are such a great and powerful nation, it just seems so beneath, so beneath a nation as wonderful and as powerful as ours to tell kids they can’t go back and forth and talk to students in Cuba. They can go into – they can go to Russia and they can go to China, they can go everywhere else. Here’s little Cuba. It makes no sense. You don’t have to answer that. I know –

SECRETARY CLINTON: (Laughter.)

CHAIRMAN LEAHY: I can see the wheels turning, and I’ll let you off the hook, but we’ll talk further about that.

Senator Gregg.

SECRETARY CLINTON: Thank you, Mr. Chairman.

SENATOR GREGG: Thank you, Mr. Chairman. First, one of our closest allies in the Middle East and a stabilizing force in the Middle East is Jordan. And they’ve really borne the brunt of a lot of our policies in the form of some costs of refugees and border security issues. They requested $300 million additional assistance in the supplemental. I was wondering if the Administration supports that.

SECRETARY CLINTON: Well, Senator Gregg, as you know, Jordan is a stalwart ally and their work with us over the years has been extraordinarily helpful. We, in this budget, hit the targets that were set in the memorandum of understanding that we certainly abide by, which is – gives us about 600 and – over $600 million. The supplemental amount is something that we are considering and looking at. Obviously, in this time of real budget constraints, it’s a challenge, but we know how much Jordan has done. We just have to try to see whether it’s doable within the confines of the budget.

SENATOR GREGG: Well, considering what we’re spending in Iraq and Afghanistan, Pakistan, it would seem to me to be dollars well spent and probably have a much better impact in the area of stabilization in the region.

Let me ask you two specific areas that I’d be interested in getting your thoughts on, because they appear to be energizers of most of our problems. The first is the issue of where you think the Palestinian issue is going and where you think Israel is going in relationship to Palestine. And secondly, the issue of the India-Pakistan relationship and what we’re doing to try to create some comity there so that we can take advantage of our friendships, or participate with the friendships in both countries.

SECRETARY CLINTON: Well, Senator Gregg, those are two issues that we spend a lot of time working on. First, with respect to the Palestinians, there are really two aspects of our engagement with the Palestinian Authority. The first is our continuing effort under the leadership of former Senator Mitchell for the Israelis and the Palestinians to resume negotiations. We hope that that will commence shortly. We think it’s absolutely essential that they begin to talk about the final status issues that divide them, that have perpetuated the conflict over all of these years. But we’re well aware of the difficulties that confront us on this.

At the same time, we continue to work with the Palestinian Authority to support their efforts to build their capacity, particularly in security. General Dayton has done a superb job working with Prime Minister Fayyad in creating a Palestinian security force that is respected by the Israelis, that demonstrates a capacity to perform under difficult circumstances. We have encouraged other countries to provide funding directly to the Palestinian Authority so that they can help build their judicial system, their prosecutorial system, their corrections system. It’s not enough just to have a good security force. You’ve got to have the rest of the law enforcement judicial apparatus functioning. And we’re getting support do to that, given directly to the Palestinian Authority.

So on both of those tracks, there are certainly challenges ahead, particularly on the first, the political negotiation track. But the progress that is being made on the second track actually increases the leverage and the credibility of the Palestinians in negotiations with the Israelis. Secondly, with respect to India and Pakistan, we’ve encouraged the resumption of the direct talks which were suspended when President Musharraf left office. Those talks between President Musharraf and Prime Minister Singh had actually been quite productive, particularly in producing results on the ground in Kashmir. But they’ve been in abeyance now for I think slightly more than two years.

So we’ve encouraged both countries to begin a dialogue. They are going to be doing so. There will be a meeting within days, as I recall the date. And we are sensitive to the concerns that they each have that it’s their issues that they have to address, but we continue to raise it and make the case to each separately as to why it’s in their mutual interest to proceed.

What’s going on in Pakistan right now is very significant. The increasing efforts by the Pakistani military and intelligence services to capture Taliban leaders, which they’ve done, to work with the United States both on the civilian and the military side, better to assist in what they’re doing to reclaim territory, from Swat to North Waziristan. We’re trying to create a new relationship with Pakistan that is of longer duration and making the Pakistanis know that we’re in it for the long term. With India, we’ve had a very successful start to this Administration building on, frankly, the success and the investment of the prior two administrations in working with India, creating more opportunities for investment, more relationship building between our two governments.

So I think that in these two areas, which are two of the most significant areas for America’s long-term security, we are working very hard and trying to make even very small but significant progress in any way we can.

SENATOR GREGG: Thank you. I notice we just appointed an ambassador to Syria. There has been some slight opening, very slight opening of dialogue there. Can you tell us where you see that going?

SECRETARY CLINTON: Well, Senator, we have. We’ve decided to return an ambassador. We’ve been without one since 2005. We have a very experienced diplomat, Robert Ford, who has served in Iraq as the political director, is fluent in Arabic, lots of experience in the region. I agree with your characterization that there’s a slight opening for us to build on. We’ve had high-level visits. Highly-ranking members of Congress have also gone to Syria in the last year. But there are a lot of issues between our government and the Syrian Government, and we’ve been absolutely clear about those issues.

Just recently, Under Secretary Bill Burns had very intense, substantive talks in Damascus, and we have laid out for the Syrians the need for greater cooperation with respect to Iraq, the end to interference in Lebanon, and the transport or provision of weapons to Hezbollah, a resumption of the Israeli-Syrian track on the peace process, which had been proceeding through the offices of the Turks the last years, and generally, to begin to move away from the relationship with Iran, which is so deeply troubling to the region as well as to the United States.

There are many specifics under each of those big-ticket items that we have discussed with the Syrians, and we are going to resume ambassadorial-level representation, but these issues have to be addressed continually.

SENATOR GREGG: Thank you, Madam Secretary.

CHAIRMAN LEAHY: Thank you. Senator Mikulski.

SENATOR MIKULSKI: Madam Secretary, it’s so great to welcome you back to the Senate. We miss you. And we know today you’ve really presented an appropriations request representing your role as the CEO of the State Department as well as America’s top diplomat. Reading the budget, I see where the President, with your advice and to us, meets compelling human need around the world. It’s in our strategic interest. It reestablishes relationships with treasured allies and then I know I speak in a heartfelt way that – the focus on women and girls in development. Also, I note the – your desire to reinvigorate and reestablish the professionalism that once was the hallmark of AID. So we appreciate that.

Let me get right to my questions. One, I’m going to associate myself with remarks of Senator Leahy about Iran, and we would hope to discuss after this hearing how we could follow up on those close alignment. But do you – I’m concerned that there is a lack of intensity in the international arena as we push or advocate for sanctions. My concern that Russia and China are slow-walking us – you might or might not want to comment on that. What it is – is your view and the Administration’s view that we’ll move with our own sanctions after the international community acts, or are we not going to wait for them, or is that yet to be determined?

SECRETARY CLINTON: Thank you, Senator, and thank you for your encouragement and support of our initiatives, particularly around women and girls. I appreciate that very much. With respect to Iran, I feel the intensity of our efforts very personally because I have been out there engaged in bilateral and multilateral diplomacy with countries that we are moving toward an acceptance of the need for greater pressure on Iran.

When President Obama came to office, he very clearly, and I think correctly, laid out what we needed to do. He said, look, we’ll extend our hand, but you have to unclench your fist. And from the very beginning, he said we will have a two-track process. We will engage, but it’s a two-way street. There has to be something coming back. And we will pursue pressure and sanctions in order to change behavior and to send as clear an international signal as possible that Iran’s pursuit of nuclear weapons will not be allowed.

Now, I believe that because of the President’s policy of engagement, we are in a much stronger position today than we would have been in the absence of all of our efforts. We have kept the so-called P-5+1, which is the UK, France, Germany, China, Russia and us, united until now. We have issued very strong statements with both Russia and China signing on, endorsing this dual-track approach. We have demonstrated to countries that are somewhat ambivalent, to say the least, about going against Iran what it is we are trying to achieve and pointing out the problems that Iran poses to them.

So just in the last month, I’ve attended a London conference on Afghanistan and Pakistan, but spent an enormous amount of time in bilateral negotiations with all of the major parties about Iran. I went to Saudi Arabia and Qatar last week. I’m on my way to Latin America next week. And Iran is at the top of my agenda. And in the Security Council, our negotiations are very intensely underway. There’s been an enormous amount of work done by the Treasury Department and the State Department to design sanctions that will be aimed at the Revolutionary Guard.

I think we’ve made tremendous progress with Russia and I believe it is due to the President’s engagement with Medvedev and our very clear, consistent message over this past year about the way we see Iran, which the Russians now are endorsing. With China, because of their dependence on Iranian oil, our arguments to them are somewhat different, that because of their dependence, they above all should be supporting a sanctions pressure track because an arms race in the Gulf that would further destabilize the major oil producers is not in China’s interests, and I think we’ve made a lot of progress.

Now, we don’t come out and do a press conference every time we have these meetings, but I have seen over the past year the attitudes about Iran evolve. So even countries that are still not sure they want to sign up to sanctions, they’re not sure they want to oppose them, they now understand why the United States views Iran’s behavior as a threat.

And finally, Senator, I want us to work in tandem as a United States Government, the Administration and the Congress together, focused on what are the smartest, toughest sanctions that can be legislated that will assist our efforts. Because we want to make sure that we don’t send wrong messages before we get everybody signed up to whatever we can achieve internationally.

SENATOR MIKULSKI: Well, thank you very much, Madam Secretary. It’s very clear, one, we appreciate your personal, hands-on, robust involvement in moving this agenda forward. And we salute you for identifying the risk of a lackluster response to Iran that would not only endanger our security, treasured allies, but also the rest of the world. So we thank you for that.

We also want to thank you for your speech on China and the cyber world. Senator Bond and I are on the Intelligence Committee. I’m on a task force on the cyber terrorism issue. We want to work – today this is not the environment to have this conversation, a more classified – a classified one would be appropriate. But I believe that cyber terrorism, cyber intrusion, is really one of the biggest threats facing the United States and the free world. If the terrorists can attack and steal our ideas or place our critical assets into jeopardy, it is – has the potency that I believe is far more dangerous than even nuclear and other weapons of mass destruction. So that’s a topic for other discussion.

But I’d like to just shift my time to a compassion issue, which is Haiti. We really want to salute the Administration and work with the Congress on our response to Haiti, as well as President Bill Clinton’s global initiative. I worry about compassion fatigue not of our country but of allies. And I wonder how you see that.

And number two, what do you see are the future sustained efforts? I represent a substantial number of NGOs that are headquartered in Maryland, like Catholic Relief. And then there’s another issue that I’d like you to consider and follow up with your staff, that is the issue of amputees.

SECRETARY CLINTON: Yes.

SENATOR MIKULSKI: In all of the terrible tragedy so much of the population has suffered amputation. My colleague, Senator Leahy, has been one of the leaders. I had the great honor of being with him in Mozambique, where he had created a low-tech, but highly effective industry where people who had been victims of landmines – children, adults, the elderly – and I saw where they could make their own products that could help them sustain themselves in a very rugged environment. I was so proud of what Senator Leahy did. And I really bring this to the attention that Senator Leahy, with his leadership as the Chair, your work in Haiti, that we take special attention to that.

I’ve reached out to the Bloomberg School of Public Health. I have a list of people who’ve done this around the world where there are models and lessons learned. But again, it was the Leahy leadership in (inaudible) Africa and your work here, because what I fear is after the TV cameras leave and we want to go rebuild a country that’s 80 percent agriculture, they won’t be able to do the work. And also, could that also be another source of employment right there in country? So you might not have the answer today, but I’d like to lay that out as a policy direction that perhaps we could pursue.

CHAIRMAN LEAHY: All right.

SECRETARY CLINTON: Could I take a little time, Mr. Chairman, to respond because –

CHAIRMAN LEAHY: Sure.

SECRETARY CLINTON: – this is – I was smiling because I had a meeting –

CHAIRMAN LEAHY: I should note that the Secretary has – when she was in the Senate, supported me –

SENATOR MIKULSKI: Have you already been talking about this?

CHAIRMAN LEAHY: – on every single one of these efforts to help the amputees as the Senator from Maryland.

SENATOR MIKULSKI: Well, he’s been waiting.

SECRETARY CLINTON: Well, I was meeting with Dr. Raj Shah, our new USAID Administrator, telling him about this work that Senator Leahy has led and that so many of us supported for exactly the reasons that you’re pointing out, Senator Mikulski. The amputation issue is going to be one we have to address. We’re trying to put together a plan now. And I would like to come back to all of you who are concerned about this to make sure that you know what we’re doing, that we have all the information you have at your fingertips, the experience that resides here on this committee, and that we have adequate funding to address it because I think that is a wonderful compassion initiative for the United States.

But to your other point, Senator, I am very heartened by what I see happening in the international community. Every single country in the Western Hemisphere has contributed something to Haiti, and they have made a collective commitment of money plus individual countries like Brazil and Mexico that have more capacity, but even poor countries like Guatemala. The Dominican Republic has been extraordinary in what it has done for its neighbor.

We’ve having a conference that is co-hosted by the United States, the United Nations, and major donor countries at the UN on March 31^st to really nail down these commitments. The United States is working very closely with the Haitian Government to stand up a development authority that will be supported to fulfill the reconstruction and recovery work now that the relief phase is ending. But I think this is an opportunity for us. Our military performed admirably and just completely eliminated any of those old canards about the United States military in our hemisphere.

We had a very robust public diplomacy effort under Secretary Judith McHale, whom you know, drove this and we basically looked at every press coverage in the world about what we were doing in Haiti. If there was a story that was inaccurate or unfair, we immediately responded. And the net result is that I think the United States is seen as the leader that we have been in doing this work.

SENATOR MIKULSKI: Well, that’s fantastic. My time is up. There – I have a constituent who’s in a Burmese prison, and I’d like to talk to you – your staff has been great, but I’d like to talk with you about more – perhaps other avenues for his release.

SECRETARY CLINTON: Good.

CHAIRMAN LEAHY: And the Secretary’s been wonderful in being accessible to us. And I want to make sure everybody gets a chance –

SENATOR MIKULSKI: Yes.

CHAIRMAN LEAHY: – before she has to leave. Senator Bond has been one of the hardest working members of this committee. I want to make sure he gets a chance to be heard.

SENATOR BOND: Thank you for your kind words, Mr. Chairman. And I join with you and Senator Gregg in issuing a very warm welcome to the Secretary back to the Senate. And I certainly join them in applauding your leadership. The State Department – I personally am delighted with your active – in support of the concept of smart power, particularly in nations where we see the threat of extremist violent terrorism in Islamic lands threatening not only their people, our interests, their neighbors, but the United States. And smart power, through the use of diplomatic efforts, personal visits, economic cooperation to a trade, investment and educational exchanges can work.

But one of the things that I have seen as I’ve traveled around the world is the great need for more of your personnel on the ground. And I join with Senator Gregg in supporting – and the Chairman in supporting your budget to rebuild our civilian foreign assistance capacity. That’s very important.

As you may know – as you know, I’m interested in Southeast Asia, which 10 nations comprise our fifth-largest two-way trading partner. Equal – exports equal almost what we send to China. And the keystone of that whole area is Indonesia. I thank you for recognizing Indonesia’s importance with one of your first official visits and ensuring that the President can go there. No better example of our friendship. And I just visited with President Yudhoyono last month, who was interested in far more United States investment and participation. And I guess the first question is, does the Administration support any conditionality at all on the foreign military assistance – foreign aid and foreign assistance to Indonesia?

SECRETARY CLINTON: Senator, thank you for those comments. And as you know, President Obama will be going to Indonesia –

SENATOR BOND: Right.

SECRETARY CLINTON: – in March with his family. And we have been working hard with the Indonesian Government to be able to be in a position where we can resume support for vital security functions. And we are looking at ensuring that the Indonesian democracy that has taken hold there will make sure that there’s no resumption of any human rights abuses or other kinds of behaviors that we, you know, deplore. This is an area where Chairman Leahy has been a real leader. We hope to be able to come, before the President’s trip, and brief you on how we would like to be able to move into a new era of cooperation because the Indonesians have been very helpful to us on counterterrorism. I think a lot of what they’ve done in their own – in dealing with their own threats has really been first – you know, first-rate in the sense of the results that they’ve gotten. But we just have to make sure that we’re complying with all the legislative criteria, and we think we can do that.

SENATOR BOND: Well, Madam Secretary, I believe there’s a new era. It’s been totally changed.

SECRETARY CLINTON: I do, too.

SENATOR BOND: President Yudhoyono has reformed the military. A former general, he stepped out of the military. He’s working to establish – and we need much stronger IMET cooperation to make sure the military leaders understand that they are under civilian rule. We need to fight corruption and ensure continued support. They need our active support militarily, but they need the support of private businesses.

And I – as I’ve visited those countries, I find that American business people abroad are penalized, facing double taxation. I visited Thailand. The American Chamber of Commerce there is probably one of the best public diplomacy outreaches we have. They have adopt-a-school programs. They’re constructing playgrounds, libraries, water tanks, water filtration, helping children with dental deformities. But the problem is that our system of taxation penalizes the CEOs so all the American companies that could be leading for America have to be Australians, Brits or Kiwis because of our extraterritorial taxation. I just – I know that’s a sensitive subject. I’ve been fighting it. But what’s your view of the role that private American businesses’ investment and participation in developing countries can do to strengthen our relationship.

SECRETARY CLINTON: Well, I believe very strongly that American business is critical to American interests and American security and prosperity. I met this morning with two of our leading companies’ CEOs, Indra Nooyi from Pepsico and Jeff Immelt from GE, talking about how the State Department and our commercial diplomacy efforts need to be more in support of what American businesses are doing because the competition is so rough.

SENATOR BOND: Right. And we– if we – with the double taxation, the punitive taxation, we penalize them putting American CEOs in charge of it. I have lots more questions, but on – I want to turn to Afghanistan. My staff met with Joanne Herring, who founded the Marshall Fund charities. And during Charlie Wilson’s days in the ‘80s, she was working to help the people of Afghanistan. She has some views on a comprehensive approach to reconstruction and development, bringing NGOs together. And I would ask, number one, that you at least give a hearing to them. She – they would like USAID dollars. I hope you’ll consider that.

Also, I hope that you will – that the additional funds for USAID will help them take agricultural experts. I – for two years, this committee supported me in putting $5 million in the budget to send ag extension agents several years ago to Afghanistan, and they never got one there. The Missouri National Guard has the agricultural development team, which is making a tremendous difference in Nangarhar Province. I hope that there can be continued cooperation and providing military/civilian support for improving agriculture, teaching them not only to fish but to grow crops.

SECRETARY CLINTON: Well, Senator, again, I mean you are signing my song here because we are absolutely committed to agricultural exports. I don’t know if this committee has gotten a copy of the Afghanistan and Pakistan Regional Stabilization Strategy. If not, we will get copies to you. But in the section on rebuilding Afghanistan’s agricultural sector, just a few highlights: 89 agricultural experts, 64 from USDA, 25 from USAID on the ground in Afghanistan working in the south and the east sectors with our PRTs, our district support teams. We’ve got USAID issuing vouchers to farmers in 18 provinces, particularly in Helmand and Kandahar for inputs offering, you know, better fruits, assistance with irrigation and the like. And finally, we’re doing a high-impact irrigation initiative because all of our agriculture experts have told us that’s key.

But there’s a lot more, Senator, that I would like you to know about because you have been right about this for years, and I think finally we’re getting around to implementing it.

SENATOR BOND: Thank you.

SECRETARY CLINTON: And we are looking for assistance from land grant colleges and asking as well that as we embed our civilians in with our military, which is how we’re getting into these combat or post-combat zones, that we have the support that is needed to be able to get out there and deliver these services to farmers. And we’re doing that.

SENATOR BOND: I look forward to talking with the appropriate staffers on your team about that because there’s much, much that we can do. Thank you.

SECRETARY CLINTON: Thank you.

CHAIRMAN LEAHY: Thank you very much. Senator Landrieu.

SENATOR LANDRIEU: Thank you, Mr. Chairman. And welcome, Madam Secretary. It’s wonderful to see you back. And let me just begin by thanking you for the very admirable way that you have represented our country. Many of us are extremely proud. I know it’s a very, very difficult job that you have, and you do it very well on our behalf.

I also want to follow up with what Senator Bond said, that I specifically appreciate your partnership with Secretary Gates to marry the hard power of our military with the smart power of our diplomacy. Over the long run, I believe that is going to pay huge dividends. And it’s been missing in the last several years, and you have really filled the bill there.

I also want to acknowledge, as Senator Mikulski said, thank you for always putting women in the forefront of this debate because, as you know, women can be the drivers of economic growth and social stability around the world. They are often left out at our peril because no plans really work without them being at the table. And I think often they are left out, but with your leadership they have not been.

In one particular area, Madam Secretary, I wanted to ask you some questions. And this is about something you and I have worked on for many years together, and that is the rights of the world’s children, particularly orphans. This has been in the news from day one in Haiti, but it’s really should be news all over the world because conservative estimates have about – the number pegged at somewhere about 143 million orphans. We don’t know the real number. We know that there are some issues with those definitions. UNICEF’s definition is a little bit different than other definitions.

But my point is this or my question is this: Senator Inhofe and I and other members in a bipartisan way have introduced a bill called the Families for Orphans Act, which is pending before the Foreign Relations Committee of the Senate now. This bill would establish in the State Department an opportunity to focus on the plight of orphans and to promote the simple but profound concept that actually children belong in families. They don’t belong in institutions. They can’t raise themselves on the streets. That if we want to stop trafficking, if we want to stop exploitation of children, prostitution of children, the best thing to do would be to put them under the watchful eye and care of a family. So that’s what our bill attempts to do.

Could you give us your views about our efforts there? If you’re familiar with the specific aspects of this bill, please comment. But what are your general views about what we could do to focus our efforts and the world’s efforts to really connect orphans to families that need them or children that need families?

SECRETARY CLINTON: Well, Senator, let me start by acknowledging and thanking you for your passion about this. You and I have both worked together on this and talked over many years about it, but you’ve been the leader. You have really demonstrated a heartfelt commitment to the world’s children in so many different aspects. I share that commitment and I am looking for the best way forward, how we can realize the positive results that we both seek, because I share your conviction that the best place for a child is in a family, and it may not be a family with a mother and a father. It might be grandparents, it might be older siblings, it might be aunts or uncles, or even in some societies extended families.

And– so there are three areas that I think we have to focus on. One, there is in many parts of the world no capacity for absorbing orphans and no real sense of adoption or fostering in any organized institutional way. So I think we need to up our outreach to provide education, technical capacity to help countries because in some countries adoption is really against the culture. And so if they’re not some blood connection, the child has nowhere to go. And I think there’s a slow change in this but we have to do more in a public diplomacy outreach way. And I’d like to work with you on that.

Secondly, in times of crisis, we have to have our systems in place. We certainly saw that in Haiti because there’s a lot of misunderstanding. There’s confusion in any disaster. So we’re working on kind of a lessons learned from disasters, from conflict situations, about what more can be done. And we need high-level advocacy.

We have a children’s office in the State Department. It would be my preference that we sort of build that up because I want it embedded. I don’t want it to be – I don’t want this to be an add-on. I want it to permeate – what I’m trying to do with women is to permeate the department so that women are part of the policy if you’re serving in Europe or Africa or part of the policy if you’re doing outreach in Angola. We are just going to try to permeate. I want the same attitude about children. So we need better education, more technical capacity, more direction and support. And I’d like to work with you to make sure that what we’re doing will actually have the results that we both seek.

SENATOR LANDRIEU: And I appreciate that, and I thank you for pointing out that in many countries of the world there isn’t the same urgency or appreciation for the strength of families that exists in America. But just that people can’t appreciate that doesn’t necessarily mean that it’s not the right thing. And I appreciate your commitment.

One figure that I want to throw out today, because these figures are hard to come by and some people throw up their hands and say the problem is overwhelming, we can’t address it, but I want to leave you with these numbers. If you just took 50 percent of the estimated orphans, Senator – Secretary Clinton, that would be roughly 70 million children. There are 2.5 billion families in the world. So if only two-and-a-half percent of families in the world – only two-and-a-half percent – opened up their homes and their hearts, there would be no orphans left in the world. So while these numbers are overwhelming, when you put them in perspective to how many parents would adopt, how many families want to open up their homes, how many churches, synagogues and mosques are willing to step up, it’s just the government enterprises have to get themselves better organized.

So I know you’re a great leader in this area. I look forward to working with you. And I know that your position is generally against institutional care and for care in families. So thank you very much. And thank you, Mr. Chairman, for your leadership on this issue as well.

CHAIRMAN LEAHY: Thank you very much, Senator. And of course, we all know the amount of time and effort you’ve spent on this issue and I applaud you for it.

Senator Voinovich. Next to you.

SENATOR VOINOVICH: Thank you, Mr. Chairman. Madam Secretary, I’ve got three areas that I’m going to mention and I’m hopeful that you’ll be able to respond to at least one of them. And if we don’t get a second round, Mr. Chairman, I would hope that the people that are here would respond to them to me in writing.

First of all, I want to congratulate you on putting together a great team. I don’t know of any Secretary of State that’s had more on their plate than you have and you understand that you can’t do it alone.

I also applaud the fact that you have created two deputy secretaries, one for management and one for policy. As you know, I was critical of the former administration because they didn’t pay enough attention to management. I want to tell you that the most important – one of the most important things you’ve done for your people is the issue of location pay.

SECRETARY CLINTON: Yes.

SENATOR VOINOVICH: And I hope that that is reflected in this budget. The Foreign Relations Committee hasn’t yet set out their vision, I guess, for the next five years, but that’s important.

Second of all, I’d like to say that where the visa waiver program has worked, they have less work than they had before because of that program.

And last but not least, the embassies. I visited a couple of countries and they’re really pleased with those embassies. And I think it’s important to the countries because it indicates to them that the United States is really interested in them and their future.

Last week, I was in Slovenia, Croatia, Bosnia, Macedonia, Kosovo, and Serbia with Senator Shaheen. And I know you’re focused on Iraq and Iran and Afghanistan, but probably more than maybe some other Secretary of State, I know that you’re interested in that region. We have spent a lot of time, a lot of money, and I’m concerned that if we don’t pay attention to it, all of the progress that we have made may be for naught.

The good news, when I visited these countries, they didn’t mention the FMA or IMET. But what they did mention was the state partnership that they have with our states. This wasn’t on this trip, but when I was in Latvia the last time, the Latvian group going to Afghanistan had the Michigan National Guard serving under it. And I know that the Ohio Guard is doing a fantastic job in Serbia today. I mean, it’s – just to hear their defense minister talk about that partnership just gives me goosebumps.

Second of all, you know that their budgets are not very good. They’ve got the same problems we have. But they’re helping us in many of them, in Afghanistan and Kosovo. And they care about the region– it’s interesting. Each of these countries, they’re concerned about themselves, but they realize they have a symbiotic relationship with the other countries that are there. And their vision is my vision, is that they all get in the European Union, they become part of NATO and then become part of the Euro-Atlantic alliance.

And a couple of things they’re concerned about. One is EU membership. They know that there is fatigue today in the European Union and many of them were using it as an incentive to get them to do some things we wanted them to do, but they’re afraid that they’ll never get in the European Union. Most of them were concerned about Bosnia. To put it in a nutshell, the Butmir process has not worked. No progress will be made on that, they think – and this is the consensus – till after the election.

But what they’re worried about is that in the election, they’ll poison the well, so that after the election, the issue of changing the constitution to give it more flexibility is not going to occur. And they argue strenuously for Bosnia getting into the European Visa Waiver Program and they also think it’s very important that some indication of their getting IMAP is – or MAP is going to happen. And their concern is that Dodik right now and his president – one of the three presidents – is in favor of NATO membership, but after the election they think possibly this thing would just blow up and then we’ll have a black hole there in that part of the world.

In addition to that, they’re all concerned about Kosovo because you know the court’s going to decide one way or the other on Kosovo. And when I talked with Prime Minister Thaci, I said you ought to be thinking about what’s going to happen here. And I talked to the Serbs, said you better think about what’s going to happen on the ground. And I think it’s really important that the State Department encourage them to do that.

The last part of this deals with Afghanistan. I had – I was honored that Holbrooke spent a couple hours – I went over there and spent – I was absolutely impressed with what they’re doing. But I don’t think that we have been candid enough with the American people about the commitment that we’re going to have to make in Afghanistan if we intend to be successful. Now, you’ve mentioned some of the things that you’re doing, but this is not going to be next year or the year after. This is maybe five, ten years. It could even be more than that if we’re going to create an environment where the Taliban, who it’s – with them it’s Allahu Akbar – okay, that’s what you’re dealing with. And so you’re going to have to really do a lot of work there to counteract that and get people to feel good about it.

And you’re also going to have to make – and you should level with the American people. Okay. The last time around, if you remember, we were there, is that we did not level with the American people about the commitment that we’re going to have to make. We’re just kind of – and we need to put it out. This is a commitment we’re going to have to make. The Europeans, by the way, also want to know about the commitment in terms of military and also in terms of their – what do you call it – P --

SECRETARY CLINTON: PRTs.

SENATOR VOINOVICH: PRTs. And I congratulate you on getting them all together. They don’t feel like we’re just telling them what to do. There’s a consensus that you’ve got to keep doing it. But I think it’s really important that we level with the American people and the world about what kind of commitment we’re going to have to make to be successful in Afghanistan.

And last but not least, I’m concerned about whether Karzai is going to do his thing. And if you recall, in terms of Iraq, we laid out a whole list of things they promised to do, and then we used metrics to see whether or not they did them or not. And I would think that rather than having it come from Congress, that you give some serious consideration to saying here’s what they did, we’re going to monitor their progress so that you can keep us informed and the American people that they’re doing what they’re supposed to do, because if they don’t do what they’re supposed to do, we’re in big trouble.

SECRETARY CLINTON: Well, Senator, I don’t think there’s a thing you said that I disagree with. And I thank you for your interest and focus on Southern Europe. We are very concerned as well about the direction we see Bosnia heading. We need to have more attention paid. We need to partner with the Europeans so that they are committed. We are obviously a strong supporter of the countries in Southern Europe going into the EU. We think it has a lot of benefits for the countries, but also the broader effort for integration in Europe and the transatlantic alliance. But we also think with respect to NATO that we have to make clear what it would take to get MAP and then move Bosnia forward.

I think, Senator, that your attention to these issues is something that I’d like to take more advantage of, because you have been consistently concerned and involved. I share your wariness about what happens after the court decision in Kosovo, and I think I’d like to follow up with you to make sure that we convey to our Serbian friends and our Kosovar friends that this has to be managed in the right way.

And finally, on Afghanistan, I agree that we have to be as candid as possible. We can’t lay down a clear path forward and say this is the way it’s exactly going to be, but we can certainly set the general direction. And we have said consistently that our goal is to transition military security to the Afghans, and we’ve seen some real progress under General McChrystal and General Caldwell in improvements in Afghan security, both army and police recruitment and retention and performance. But we are going to have a long-term civilian relationship and we think we need that. We think that’s going to be in America’s interests. And I agree with you that we need to make that as clear as we can. And we want also to use the metrics that we’ve developed that I would hope have been shared with you – but if not, we will – as to how we’re going to try to hold the Karzai government accountable.

SENATOR VOINOVICH: Thank you.

CHAIRMAN LEAHY: Senator Specter.

SENATOR SPECTER: Thank you, Mr. Chairman. Madam Secretary, thank you for taking on the job and the hard work and successful work you’re doing. We miss you in the Senate, but we like to see you where you are.

Thank you for the call from your Deputy Bill Burns about his trip to Syria. The question on my mind that I alerted him to this yesterday as to whether the stalemate might be broken between Syria and Israel on negotiations if the President were to invite them to the Oval Office. Back in 1995, Senator Hank Brown and I were in India and Prime Minister Rao brought up the subject of his interest in having the subcontinent nuclear-free and asked us to convey that message to Prime Minister Bhutto, whom we saw the next day. And we made a recommendation to President Clinton to consider calling them in.

I had recalled the tremendous success that President Clinton had with Yasser Arafat and Shimon Peres and Rabin that memorable day on the White House lawn. Would you give consideration to that process? I have gotten to know the Assads, both the father and the current president, and I think the right nudge could push them to the table. Came very close in ‘95, came very close in 2000. The Turks have been in the process of mediating. But would you consider that?

SECRETARY CLINTON: Well, Senator, I certainly will look at anything that might break the stalemate. I’m not sure that that would be acceptable or doable to all of the parties involved, but certainly our goal is to help facilitate a resumption of talks between Israel and Syria. We think it’s absolutely necessary for Israel’s security and future to try to move the whole region toward a more peaceful state. So we’ll certainly take any idea you have under consideration because you have been – I don’t know how many times you’ve been to Syria by now, but it’s –

SENATOR SPECTER: Eighteen.

SECRETARY CLINTON: Eighteen. It’s more than anybody else that I personally know. So we take what you say – and that’s why Under Secretary Burns called to report to you – we take what you say very seriously and we’ll certainly consider it.

SENATOR SPECTER: I have been concerned about the gridlock in Congress for many reasons, but from what I have read and heard, it has had an impact on our stature internationally. The President came on with a great promise, and I think did materially change the world’s view of the United States for a number of reasons. And I think not only has President Obama been diminished, but so has the presidency, and for that matter, so has the ability of governance by the Congress of the United States – very, very – problems.

And we ought to be backing up the President on matters that he has to deal with of such gigantic importance – and I read your statement – across the board; Iran and North Korea and the Mideast and Afghanistan and everywhere. May the record show an affirmative nod – we trial lawyers use that procedure sometime, not being sure what the answer will be. What do you think?

SECRETARY CLINTON: Well, Senator, I have great affection and admiration for the Senate. The eight years I was privileged to serve here were extraordinarily meaningful to me. But unfortunately, I have to agree with you; the gridlock over nominations is particularly troubling. We’re now, what, more than a year into a new Administration, and whether you agree or disagree with a particular policy, a president deserves to have the people that he nominates serving him. And I would earnestly request the attention of this committee to filling the USAID appointments. We finally got Dr. Shah nominated and confirmed. There was no delay on that, and I thank you for it, but he has no team and we’ve got to get that moving as quickly as possible.

But I have to confess that when it came to some assistant secretary positions, some ambassadorial positions, it became harder and harder to explain to countries, particularly countries of significance, why we had nobody in position for them to interact with. So I think that as we move forward, there are many things to argue about and I am the strongest advocate of people arguing out positions in a civil way that hopefully sheds more light than smoke. But on the question of nominations, I hope that we all can move more quickly, and particularly on the AID front and the ambassadorial front.

SENATOR SPECTER: Well, I will help you with that. But Madam Secretary, beyond the confirmations is my perception, right or wrong, that what has happened on gridlock goes beyond that – the weakening of the President. Everybody reads the public opinion polls. He’s not able to project the same kind of stature and power that he did a year ago because he’s being hamstrung by the Congress, and it has an impact on foreign policy, which we really ought to do everything we can not to have partisanship influence.

SECRETARY CLINTON: Well, Senator, I think there is certainly a perception that I encounter in representing our country around the world that supports your characterization. People don’t understand the way our system operates. They just don’t get it. And their view is – it does color whether the United States is in a position – not just this President, but our country is in a position going forward to demonstrate the kind of unity and strength and effectiveness that I think we have to in this very complex and dangerous world. And we’re always going to have differences between the Executive and the Legislative Branch, having served on both ends of Pennsylvania Avenue. That’s par for the course. That’s democracy. We’re not going to do anything that will undermine that.

But I do think we have to be attuned to how the rest of the world sees the functioning of our government, because it’s an asset. It may be an intangible asset, but it’s an asset of great importance. And as we sell democracy and we’re the lead democracy in the world, I want people to know that we have checks and balances, but we also have the capacity to move too. So it is a concern of mine and I hope that we can figure out a better way to address it.

SENATOR SPECTER: No more questions, Mr. Chairman, but a comment. On Iran, I hope you will figure out something that we can get the Chinese to go along with, which is tough enough to get some sense out of Iran. Because that boiling pot is not going to simply boil forever.

And the final comment is I know you’ve done a great deal on the three hikers in Iran, one of whom lives in the Philadelphia suburbs, Joshua Fattal, but whatever in addition can be done, it would be greatly appreciated in many quarters.

SECRETARY CLINTON: Thank you, sir.

SENATOR SPECTER: Thank you, Madam Secretary. Thank you, Mr. Chairman.

CHAIRMAN LEAHY: Thank you. Incidentally, on Iran – I’m going to yield back to Senator Bennett – but on Iran, there is – I want to leave it with you and your staff. An op-ed column in the Times by Roger Cohen about we preclude things going to Iran – one of the things he suggested we shouldn’t be precluding, and that’s the equipment. They might need to get on the internet and get on it more freely as kind of a layman’s description of it. I would look at that, because especially as they’re working so hard to block internet, anything we can get in there, which you know will get around the country – would be helpful.

SECRETARY CLINTON: If I could, Mr. Chairman, I just want to respond to Mr. Cohen’s column. It references a pending license that was held up in the Treasury Department. That has now been moved. Perhaps there’s a cause and effect there. And it is now in the State Department and we intend to act on it expeditiously.

CHAIRMAN LEAHY: As the old serials on radio would say, “My work here is done.” (Laughter.)

Senator Bennett.

SENATOR BENNETT: Thank you very much, Mr. Chairman. And I join, Madam Secretary, my colleagues in welcoming you back to your old stomping grounds, seeing you on the other side of the table with a different kind of reaction. But we’re always happy to see you regardless of the circumstance.

Coming as late in the questioning as I do, I won’t rehash many of the things that have been said by my colleagues. But I will not let the opportunity to mention Iran and the Iran Sanctions Act go un-chosen. I won’t have to add anything to things that have been said. But I believe that’s extremely important, and whatever you can do to see to it that the Russians and the Chinese are helpful to us here – and I won’t go into territory about what I think may be happening with both Russia and China because I don’t want to say anything that makes any particular headlines. But I understand from reading history that Ronald Reagan used to drive Mikhail Gorbachev crazy by quoting the old Russian aphorism, “Trust but verify.” And Gorbachev kept – finally said to Reagan in an outburst, “You keep saying that.” And I think he did keep saying that, and we should keep saying that. So with respect to Iran and what the Russians and the Chinese are doing, just remember the Russian proverb that an American president enjoyed so much.

So I will turn to two subjects that have not been raised, both of which are enthusiasms of mine that I’ve been involved with in the committee while I’ve been on it. The first one is the Millennium Challenge Corporation, and the second one is micro-lending and micro-enterprise. If I can start with the second first, just – I’m very proud of the fact that as long as I’ve been on the subcommittee, the pressure for micro-lending has always been strong and the number has always gone up. And I don’t think there is anything we can do that makes more sense in the poorer parts of the world than encourage micro-lending. I have some of the articles that have been produced by women who have received micro-loans. They offered to make me a deal. I said, “No, I don’t want a discount. I’ll pay the full price for this because it’s still very low and I want you to be as encouraged as you can.”

Would you talk to Secretary Geithner to talk about increasing U.S. support at the World Bank? I’ve talked to the World Bank about this and I get lots of encouraging words back, but I’m not sure there’s been as much movement at the World Bank as perhaps there should be. And I hope that the State Department will continue to be as supportive and increase, as much as they possibly can in these budgetary times, support for micro-lending. Do you have a comment on that before we turn to the Millennium Challenge Corporation?

SECRETARY CLINTON: Well, Senator, I share your enthusiasm. I’ve worked in micro-enterprise since 1983 in Arkansas. I championed it when I was First Lady, and I supported programs along with you and others when I was a senator. And we are very focused on micro-enterprise, and we’re also looking at some new ways of accomplishing the goals of the Microenterprise Results and Accountability Act of 2004. We are looking at how we can fund institutions more effectively, leverage the money, and the World Bank is a big – has a big role in this. So I will gladly pass on your comments to Secretary Geithner.

SENATOR BENNETT: Yeah, my own experience with the World Bank, as I say, is they talk a good fight, but they get carried away with, well, we can do this and we can do that, and all these other things with respect to financial services, and that’s wonderful, but in the meantime, make the loans.

SECRETARY CLINTON: Right.

SENATOR BENNETT: Don’t study this thing to death.

SECRETARY CLINTON: Right.

SENATOR BENNETT: And look at possibilities. I want the possibilities to come true, but in the meantime let’s make the loans.

All right, the Millennium Challenge Corporation – I met with the new CEO, whom I find very impressive. And the concern that many of us have with respect to the Millennium Challenge Corporation is that the current Administration might take steps to curb its independence. And one of its values, I think, has been that it is an independent agency with strong guidance from a board of directors, which you chair. But can it maintain its independence or is there still a conversation about folding it into something else that would make it more part of the State Department bureaucracy or the AID bureaucracy? And the budget is the lowest request that we’ve had since it began.

I’d like you to address those two issues.

SECRETARY CLINTON: Well, Senator, I do chair the board and I’m very proud and happy to do so. And I have publicly applauded the Bush Administration for both MCC and PEPFAR, which I think were significant advances in how we think about and do development. There have been no conversations that I’ve been part of or that I’m aware of about curbing the independence of the MCC. I think that there are, as you know, some legislative fixes that need to be done so that compacts can be extended, so that money can be rolled over, and that the mission of the MCC really focused on the kind of conditions-based aid that will change behaviors and increase capacity can be supported more effectively.

So I am a strong advocate of the MCC. I think actually some of the lessons that we have learned from the MCC are part of our QDDR process and will be influencing how we do aid elsewhere. But it won’t surprise you. I’m not telling you anything you don’t know, that there is a division of opinion within the Congress concerning the MCC. There are very strong supporters and there are very strong detractors. But I think that, on balance, the MCC has proven itself. I think its independence has been beneficial. But I do want it to be seen as part of our overall efforts. Not that it’s going to be in any way undermined, but that it is part of how we deliver aid; it’s not some add-on that is stuck out in left field. It is something that is integral to what the United States Government is doing, and it’s a model that I happen to hold in high regard.

SENATOR BENNETT: Well, I recognize there are some strong supporters and some strong opponents. Put me down as a strong supporter. And my goal is not to fund monuments overseas. We go overseas and we see U.S. money going to create something which then isn’t maintained or doesn’t provide any long term. I want to fund movement, movements towards the kinds of developments that are long term, become sustaining, and I think the MCC has that particular vision. So I applaud your support and if you need any support on this side in this committee, why put me down as one who’s available.

SECRETARY CLINTON: Well, Senator, I just want to make sure that the record accurately reflects, thanks to the good information from my team here, we’re actually increasing the MCC budget. We have a 15 percent increase over FY2010. We’ve asked for 1.279 billion. That’s 174 million over FY2010, so we’re increasing the MCC budget by 15 percent.

SENATOR BENNETT: Oh, I’ll get back into that, then. Thank you. I appreciate it.

SECRETARY CLINTON: If you have any questions, please call us.

SENATOR BENNETT: I will.

SECRETARY CLINTON: We’ll walk through them with you.

SENATOR BENNETT: Thank you.

CHAIRMAN LEAHY: Thank you, Senator Bennett.

Senator Brownback.

SENATOR BROWNBACK: Thank you, Mr. Chairman. Thank you, Madam Secretary. I appreciate your being here, appreciate the way you represent us around the world and your high energy levels. I’m sure it takes every bit of it to --

SECRETARY CLINTON: Yes, it does, Senator. (Laughter.)

SENATOR BROWNBACK: I’ve got a couple of items I want to run through you, all of which you’re familiar with, but a couple really need your action. We’ve appropriated to the State Department – I think it’s $20 million for internet firewall, getting through the internet firewall. I was at your speech that you gave on this recently over at the Newseum. Congressman Wolf and I wrote you about this in 2009. Senators Specter, Casey, Kaufman, Kyl, and I wrote you about this.

We’ve allocated the money to the State Department, but State Department hasn’t given any of it to the Global Internet Freedom Consortium. This is the group I found the most effective in doing this. They believe they could get a capacity in the anti-firewall area from 1.5 million now people that can get through these firewalls to 50 million users a day with the amount of money we put forward. I got two letters here to you from basically Chinese dissident groups and Iranian dissident groups saying, would you please allocate this money to the Global Internet Freedom Group?

There was a recent Washington Post report from an unnamed senior Administration spokesman saying the reason they’re not going to the Global Internet Freedom Consortium is because the Chinese Government would, quote, “go ballistic” if this were done. These are – a number of these are Chinese dissidents that are operating these firewall items, but they’ve been very successful on rudimentary, no help from the U.S. Government, and with it, they can smash through the Iranian firewall and probably the Chinese firewall as well. And I just – I would really urge you to look at it. And I’m going to give you these two letters from those groups.

SECRETARY CLINTON: Good. Thank you, Senator.

SENATOR BROWNBACK: Because that’s in your wheelhouse already. You’ve spoken about it. You’ve got the money. We need to get it to a good group.

Second, I know you’ve been to Congo a few months back. That’s been a personal interest of mine and Senator Durbin’s as well. I think we have the chance here to defund the militias that are really just wreaking havoc all over Eastern Congo. But the key is the minerals, conflict commodities. It’s the blood diamonds issue, only you got four commodities you’re dealing with.

And I think at the core of the issue is that we require companies that are going to sell products into the U.S. – they got to have a license on the products, a license on the minerals coming out. We want you to sell the minerals, Congo. We want you to be able to get the income. But on an item like coltan that’s in cell phones, that Congo has 80 percent of the African coltan and then it comes out and these militias – this is the way they fund themselves is they kind of operate the concessions or let people come and go, and then that funds the soldiers.

If we could just require licensing on minerals that come out of Congo, I really think – and this, by the big – I really think could defund the militias, and much of this goes away – not all of it, but a lot of it. And in the blood diamonds case in West Africa, this thing mostly defunded the militias, which is what we got to do. We got to get the money away from the militias, and there’s a bill in both the House and the Senate – we have companion bills in each house that would do this. We’ve worked for several years to work with the companies, with the government that this is a way that could do this without hurting Congo and without hurting the businesses.

So I think we’ve found how to do it, but we really need your backing and support. And I don’t know of anything that could help that war-weary place. And it’s hard to say, but it’s probably the worst suffering in the world right now is in Eastern Congo. And it’s a big – it’s big. I mean, it’s 60 million people in Congo.

The third item is Sudan. I was pleased to see this recent agreement signed on Darfur – I’m going to watch and see if it actually holds – but Southern Sudan, as you know, is going to be voting fairly soon on whether to move out of the union with Northern Sudan. They’ve been – you know they’ve had a conflict a long period of time. I would really hope that State Department and the White House could start working with Southern Sudan more like a country and helping them get established and visible. I’ve thrown out – if the President or if you could meet with the leadership of Southern Sudan, the President could meet in the White House with them, as a statement of support for them.

They’ve got – I’ve been urging them, saying why don’t you get a basketball team together and start traveling America with the Southern Sudanese. They’ve got – 10 – it’s Dinka tribe dominated.

SECRETARY CLINTON: (Laughter.) They’re very tall.

SENATOR BROWNBACK: And they’re very tall. They’ve got 10 guys, Mr. Chairman, over seven feet tall playing basketball in Southern Sudan. So I’m saying, just show up; you may get beat by 40 points, but everybody’s going to say, where did these guys come from?

SECRETARY CLINTON: Mm-hmm.

SENATOR BROWNBACK: And I thought – I told him – I said, I don’t know of a better way to get on the view screen in America faster than showing up with four guys over seven feet tall playing basketball. That – anyway, just if you could work with them, I think it’s really an important phase.

And I want to finish my comments with you on this. This is a really tough one, I know, but I think it’s time for us to review our embassies in Israel and review again, with a depth of review, moving it from Tel Aviv to Jerusalem. Long issue, old issue, I know all the thorns that are around it. But it seems to me that now is a good time to do this, that we’re starting to talk about a two-state solution, have for a couple years.

Another key issue is the final status of Jerusalem. This is a negotiation just between us and the Israeli Government. I think it would be a very strong statement. It’s the only capital in the world where we don’t put our embassy in the capital city. It would be obviously well received by the Israelis. It might irritate the Iranians. I’m okay with irritating the Iranians right now with everything that they’re doing. I realize it has broader impact. But I think these things have timings to them, as you know better than anybody, and I think it’s ripe now for a discussion to begin. Particularly, we’ve had now a couple years of discussion about – of a two-state solution. I think we need to be clear that we believe Jerusalem is the capital of Israel and we’re going to act that way.

So I thank you for considering these comments and we’d love to work with you on any of them.

SECRETARY CLINTON: Well, we will get back to you on all of them, Senator, because each and every one of them is very important. I appreciate your concerns about them.

CHAIRMAN LEAHY: And the hearing record will remain open until Monday, March 1^st, for the submission of any written questions for the Secretary. I know we’ve gone beyond the time that we had asked her to be here for because of the votes, and I do appreciate that very much. And Secretary Clinton, thank you for taking this time. I know you have three others of these to do. It is helpful not only to the committee; it’s helpful to the country to hear your answers on these issues. So, thank you very much.

SECRETARY CLINTON: Thank you very much.

(Whereupon, the Committee was adjourned.)