Budget Hearing for the Department of State and USAID

Testimony
Hillary Rodham Clinton
Secretary of State
Washington, DC
February 29, 2012

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May I change out my chair for that chair right there? Thank you. I very much appreciate that. That’s much better.

Well, let me begin by thanking the chairwoman for her leadership along with Ranking Member Lowey. I have found this to be a committee that is so concerned about what’s right for our country, especially in a time of constrained resources. I always feel like I have an open door, and I hope you do as well – all of you on this committee – because we’re living in a very volatile and difficult time.

Before I begin, I want to say a few words about North Korea. And with your permission, I want to just share with you the statement that we just put out. We are looking to a continuing effort and we have completed a third exploratory round of U.S.-North Korean bilateral talks to improve the atmosphere for dialogue and demonstrate its commitment to denuclearization. North Korea has agreed to implement a moratorium on long-range missile launches, nuclear tests, and nuclear activities at Yongbyon, including uranium enrichment activities.

The DPRK has also agreed to the return of IAEA inspectors to verify and monitor the moratorium on uranium enrichment activities and confirm the disablement of the five-megawatt reactor and associated facilities.

Now, the United States, I will be quick to add, still has profound concerns, but on the occasion of Kim Jong-il’s death, I said that it is our hope that the new leadership will choose to guide their nation onto the path of peace by living up to its obligations. Today’s announcement represents a modest first step in the right direction. We, of course, will be watching closely and judging North Korea’s new leaders by their actions.

We also have agreed to meet with the North to finalize administrative details necessary to move forward with a proposed package of 240,000 metric tons of nutritional assistance along with the intensive monitoring required for the delivery of such assistance.

Now, this is just one more reminder that the world is transforming around us, from Arab revolutions to the rise of new economic powers to a more dispersed by still dangerous al-Qaida terrorist network to nuclear diplomacy on the Korean Peninsula. In this time, only the United States of America has the reach, the resources, and the relationships to anchor a more peaceful and prosperous world.

The State Department and USAID budget we discuss today is a proven investment in our national and economic security, but it is something more. It is a down payment on American leadership.

When I took this job, I saw a world that needed America but also one that questioned our focus and our staying power. So we have worked together in a bipartisan fashion to put American leadership on a firm foundation for the decades ahead. We have ended one war, we are winding down another. We have cemented our place as a Pacific power while maintaining our alliances across the Atlantic. We have elevated the role of economics within our diplomacy, and so much else. We are necessarily updating our diplomacy and development for the 21st century. And after the first-ever Quadrennial Diplomacy and Development Review, we created two new bureaus focused on counterterrorism and on energy, Chairman Rogers – and I’d be happy to go into that because it is critically important – and we reorganized a third one focused on fragile states.

Now, like most Americans in these tough economic times, we did make difficult tradeoffs and painful cuts. We have requested 18 percent less for Europe, Eurasia, and Central Asia. We are scaling back construction, and I will certainly tell everyone to keep an eye on the Embassy in London. We are improving procurement and we are taking other steps for greater efficiencies.

Of the Foreign Ops request, $51.6 billion represents USAID and State Department requests, and that is an increase of less than the rate of inflation, just over 1 percent of the federal budget.

I just want to quickly highlight five priorities.

First, our request allows us to sustain our vital national security missions in Iraq, Afghanistan, and Pakistan, and reflects temporary extraordinary costs of operating on the front lines. As President Obama has said, “The tide of war is receding.” But we still have to establish firm relationships in Iraq and Afghanistan to go forward in developing a positive partnership.

In Iraq, civilians are now in the lead as we try to work to help Iraq develop a stable, sovereign, democratic country. And we have increased our civilian budget, but State and USAID together are asking for only one-tenth of the $48 billion the U.S. Government spent on Iraq as recently as 2011. Defense spending, as all of you know so well, is now $40 billion less than just two years ago. So we are certainly seeing increases in civilian presence but dramatic decreases in federal outlays.

Despite this past week’s violence, we expect similar government-wide savings in Afghanistan. This year’s request supports the ongoing transition. Next door in Pakistan, we have a challenging but critical relationship. We continue to work together on counterterrorism, economic stability, regional cooperation.

Second, in the Asia Pacific we are making an unprecedented effort to build a strong network of relationships and institutions, because we believe in the century ahead no region will be more consequential to America’s economic and security interests.

As we tighten our belts around the world, we are investing the diplomatic attention necessary to do more. In Asia, I call it forward-deployed diplomacy. It includes even pursuing a possible opening in Burma.

Third, we are intently focused on the wave of change sweeping the Arab world. Alongside our bilateral and security support, we are proposing a $770 million Middle East and North Africa incentive fund. There are two reasons for that, Madam Chairwoman. First, we know from past experience we need a fund of money that is flexible and easily deployed after consultation with Congress, as we did after the fall of the Soviet Union. In 1989, such a fund was established just for Poland and Hungary in the cost of $1 billion for two countries. After the war between Georgia and Russia, we had a fund of a billion dollars just for Georgia. So we think there’s precedent, and it certainly does pay off in terms of American presence and responsiveness.

Secondly, what we found this past year is that there were a lot of circumstances that were coming up all the time that we had, in no way, predicted prior to the budget. So we need to have credible proposals that are evaluated by rigorous analysis and by the Congress to commit to democratic change, building effective institutions, and broad-based growth. And this budget request also will allow us, Chairman Dicks, to help the Syrian people survive a brutal assault and plan for a future without Assad.

It continues our assistance for civil society and Arab partners in Jordan, Morocco, Tunisia, and elsewhere. It does provide, Mrs. Lowey, a record level of support for our ally, Israel. It makes possible our diplomacy around the world and, through the great work of the Congress and our diplomacy at the UN and elsewhere, the toughest sanctions that Iran has ever faced.

The fourth priority is what I call economic statecraft – how do we use diplomacy and development to create American jobs? We have more than 1,000 State Department economic officers working to help American businesses connect to new markets and consumers. Every single day, we are working with our largest corporations to our smallest businesses, pushing back against corruption, red tape, favoritism, distorted currencies, intellectual property theft. And we have worked closely together to pass three free trade agreements that will create tens of thousands of American jobs, and we hope to work with Congress to ensure that as Russia enters the WTO, foreign competitors don’t have an advantage over American businesses.

And finally, we are elevating development alongside diplomacy and defense. Poverty, disease, hunger, climate change destabilize societies, sow the seeds for future conflicts. Through the Global Health Initiative, we are consolidating programs, increasing our partners’ capacity, shifting responsibilities to host countries that helps us target our resources where they are most needed. Along with our Feed the Future Initiative to drive agricultural growth and improve nutrition, we think we’re making cost-effective, results-oriented investments. We want to see measureable outcomes.

Now these five priorities are each crucial to American leadership and they rely on the work of some of the most capable, hardest working, bravest people I have ever met – the men and women of State and USAID. Working with them is one of the great honors I’ve had in public life

Let me end by just saying that American leadership is very personal to me. It is my job everywhere I go. And after three years, 95 countries, over 700,000 miles, I know very well what it means to land in a plane that says United States of America on the side. People look to us to protect our allies, stand by our principles, serve as an honest broker in making peace, to fight hunger, disease, poverty, to stand up to bullies and tyrants. And American leadership is not just respected; it is required. It takes more than just resolve; it does take resources. This country is an unparalleled force for good in the world, and we all want to make sure it stays that way, so I would urge respectfully that you work with us to continue making this investment in both strong American leadership and a more peaceful and prosperous future for us all.

Thank you, Madam Chairwoman.

ENDS

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