Carjackings, robberies, kidnappings, and militia violence all are on the rise in Libya, prompting the State Department to warn U.S. citizens to stay away from the North African country, nearly a year after Libyan rebels seized the capital Tripoli from Muammar al-Qaddafi's forces.

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Ironically, the State Department resumed full consular services for travel to and inside Libya today, but simultaneously advised Americans the country was too dangerous to visit. Militias are rounding up foreigners with little regard to the actual law or due process and the State Department has little influence with them, the department is warning.

"The Department of State warns U.S. citizens against all but essential travel to Libya," reads the new travel warning issued today. "The incidence of violent crime, especially carjacking and robbery, has become a serious problem.  In addition, political violence in the form of assassinations and vehicle bombs has increased in both Benghazi and Tripoli."

The warning is the first the State Department has issued since September 2011 and the first since the July 7 elections in Libya, which saw the Transnational National Council, which has been running the country since Qaddafi's fall, replaced this month by the General National Congress. Those elections were deemed to be free and fair, but now political uncertainly has been replaced by insecurity on the streets of Libya's major cities.

"Despite this progress, violent crime continues to be a problem in Tripoli, Benghazi, and other parts of the country," the travel warning said. "In particular, armed carjacking and robbery are on the rise. In addition, political violence, including car bombings in Tripoli and assassinations of military officers and alleged former regime officials in Benghazi, has increased. Inter-militia conflict can erupt at any time or any place in the country."

The State Department noted the kidnapping of 7 members of the Iranian Red Crescent delegation by an Islamic Libya militia late last month. The delegation had been invited by the government but was being questioned by the militia "to determine whether their activities and intentions aimed to spread the doctrine of Shiite Islam," a Libyan official told AFP.

Islamic extremists are also blamed for a string of attacks on historical and sacred religious sites over the past days aimed at Muslims of the Sufi sect and conducted in some cases with the help of uniformed members of Libya's Interior Ministry. Interior Minister Fawzi Abdel A'al resigned due to the scandal Sunday night.

Militias are also apprehending foreigners for "perceived or actual violations of Libyan law," and the State Department might not be able help because the militias may not be sanctioned or controlled by the government.

U.S. President Barack Obama has made his administration's successes against terrorist groups -- above all last year's killing of al Qaeda leader Osama bin Laden -- a central plank of his re-election campaign.

But according to the State Department's latest annual counterterrorism report, al Qaeda affiliates are gaining operational strength in the Middle East and South Asia, even though terrorist attacks worldwide are at their lowest level since 2005.

The report cited 2011 as a "landmark year" due to the deaths of Osama Bin Laden and other key al Qaeda operatives, and noted that the terrorist group's "core," largely based in Pakistan, had been weakened.

"I would not say that we are less safe now than we were several years ago, because the al Qaeda core was the most capable part of the organization by quite a lot, and was capable obviously of carrying out catastrophic attacks on a scale that none of the affiliates have been able to match," Coordinator for Counterterrorism Dan Benjamin said Tuesday at a briefing introducing the report.

Democratic transitions in the Middle East and North Africa also testified to the terrorist organization's decline, he said, though he offered a few cautionary notes.

"We saw millions of citizens throughout the Middle East advance peaceful, public demands for change without any reference to al Qaeda's incendiary world view," Benjamin said.

"This upended the group's longstanding claim that change in this region would only come through violence. These men and women have underscored in the most powerful fashion the lack of influence al Qaeda exerts over the central political issues in key Muslim majority nations."

Though AQAP benefited from the long and tumultuous political transition in Yemen, Benjamin said he expects the trend lines to go "in the right direction" under new president Abd Rabbo Mansour Hadi.

Syria, on the other hand, remains a major cause for concern with no solution in sight. The New York Times reported Sunday that Muslim jihadists are "taking a more prominent role" in the resistance.

"We believe that the number of al Qaeda fighters who are in Syria is relatively small, but there's a larger group of foreign fighters, many of whom are not directly affiliated with al Qaeda, who are either in or headed to Syria," Benjamin said.

Iran remains the preeminent state sponsor of terrorism, according to the report, as its Lebanese client, the Shiite militant group Hezbollah, is engaging in the most active and aggressive campaign since the 1990s.

Of the more than 10,000 attacks carried out in 70 countries, 64 percent occurred in Iraq, Afghanistan, and Pakistan, but both Afghanistan and Iraq saw a decrease in the number of attacks from 2010.

In Africa, there was an 11.5 percent uptick in attacks, a result of Nigerian militant group Boko Haram's more aggressive strategies and tactics. Despite criticism from Congress, the Obama administration has refused to designate Boko Haram a terrorist organization on the grounds that its attacks are not representative of its general ideology, though the State Department did designate three of its leaders terrorists in June.

The report also mentions the Haqqani network, a Taliban-affiliated group attacking NATO troops in Afghanistan. On Thursday, the Senate voted unanimously to pass a resolution urging the State Department to add the network to the list of terrorist groups, which would become effective with President Barack Obama's signature.

U.S. Secretary of State Hillary Clinton leaves Washington today on a two-week trip that includes a stop in Israel, a stop in Egypt, and a new effort to head off a possible new round of tensions with Palestinian leaders.

Clinton's travel will take her to France, Japan, Mongolia, Vietnam, Laos, Cambodia, Egypt and Israel. The first item on Clinton's international agenda is Syria, and Clinton will attend the Friday meeting in Paris of the Friends of Syria group, the U.S.- and Turkey-led diplomatic initiative that is meant to coordinate international action to resolve the Syrian crisis.

Clinton isn't expected to make any significant changes in the U.S. position on Syria, which is still, in a nutshell, to avoid direct intervention, look the other way while Gulf Arab states arms the opposition, and work with Russia to facilitate a Yemen-like political transition.

"[T]he secretary will consult with her colleagues on steps to increase pressure on the Assad regime and to support UN-Arab League Special Envoy Annan's efforts to end the violence and facilitate a political transition to a post-Assad Syria," read a statement sent out by the State Department today.

While she's in Paris, Clinton will also meet with Palestinian Authority President Mahmoud Abbas, "to discuss both parties' efforts to pursue a dialogue and build on President Abbas' exchange of letters with Prime Minister Benjamin Netanyahu," the State Department said.

Reuters reported that reported that Clinton requested the meeting and will also press Abbas not to pursue a new United Nations resolution that condemns settlements in "occupied" territories. Expectations on the Palestinian side for any progress in Paris are low, according to Reuters.

On the Israeli side, Defense Minister Ehud Barak told an audience last week at the 2012 Aspen Ideas Festival that a new unilateral settlement freeze was not likely. "The Palestinians under Abu Mazen refused once and again to get into the room without a precondition... I believe that most of the responsibility is on their shoulders," he said.

The U.S. and Palestinian leaderships have also been at loggerheads over the Palestinian drive to seek membership in U.N. bodies, such as UNESCO. U.S. law required the end of all American contributions to UNESCO after that body admitted Palestine as a member earlier this year.

On July 8, Clinton will go on to Tokyo to attend an international conference on the future of Afghanistan, a follow-up to last December's conference in Bonn, Germany. In Tokyo, Clinton will talk about the "transformation decade" in Afghanistan, which she will say begins in 2015, after the bulk of U.S. and international forces leave that country.

"The Afghan Government in turn will lay out its plan for economic reform and continued steps toward good governance," the State Department said in its release.

The next day Clinton will go to Ulaanbaatar, Mongolia, to speak to a meeting of the Governing Board of the Community of Democracies, an informal multilateral coalition of countries that promotes democratic values,, speak at a women's conference, and meet with President Tsakhiagiin Elbegdorj and Prime Minister Sükhbaataryn Batbold.

On July 10 Clinton moves on to Hanoi for a day of meetings with government and business leaders before traveling to Vientiane, Laos, on July 11. Her stop in Laos will mark the first visit to that country -- one of the world's last avowedly communist states -- by a U.S. Secretary of State in 57 years and Clinton will meet with Prime Minister Thongsing Thammavong.

After her brief stop in Laos, Clinton will arrive late in the day July 11 in Cambodia. While there, she will participate in three major conferences: the ASEAN Regional Forum, the East Asia Summit Foreign Ministers Meeting, and the U.S.-ASEAN Post-Ministerial Conference. Tensions between China and its neighbors over maritime disputes is sure to be high on the agenda.

After two days in Phnom Penh, Clinton will go to the city of Siem Reap on July 14 to meet with business leaders and deliver the keynote address at the Lower Mekong Initiative Gender Equality and Women's Empowerment Dialogue. The Lower Mekong Initiative is a development-focused forum that joins the U.S. with several southeast Asian nations.

The next day it's off to Cairo, where Clinton is reported to have a meeting scheduled with the new President Mohamed Morsy. She will stay in Egypt until July 16, and will meet with senior government officials, civil society, and business leaders, and inaugurate the U.S. consulate in Alexandria.

The last stop on Clinton's tour is Israel, where she will be meeting with as yet undisclosed Israeli leaders "to discuss peace efforts and a range of regional and bilateral issues of mutual concern," the State Department said.

Republican presidential candidate Mitt Romney is also expected to travel to Israel to meet with leaders there sometime this summer.

Secretary of State Hillary Clinton met with Finnish President Sauli Niinisto, Prime Minister Jyrki Katainen, and Foreign Minister Erkki Tuomoja in Helsinki to discuss issues including Russia, energy and the environment, and women in Afghanistan. Clinton, who is accompanied by Assistant Secretary for European and Eurasian Affairs Phil Gordon and Director of Policy Planning Jake Sullivan, also attended a Climate and Clean Air Coalition event and toured the Marimekko Factory and Design Space. Next stop: Riga, Latvia.

Elsewhere:

• In Central America, Assistant Secretary for Conflict and Stabilization Operations Rick Barton will meet with embassy partners and key stakeholders in Honduras, Guatemala, and El Salvador through the Central American Regional Security Initiative.

• Assistant Secretary for International Narcotics and Law Enforcement Affairs William Brownfield is in Lima, Peru, for the International Conference of Ministers of Foreign Affairs and Heads of Specialized National Agencies Against the World Drug Problem.

• In Haiti, Global Aids Coordinator Ambassador Eric Goosby will meet with Haitian first lady Sophia Martelly and participate in the signing of the Partnership Framework with the Government of Haiti.

• Office of Global Criminal Justice Ambassador-At-Large Stephen Rapp is in Tripoli, Libya, to attend meetings on global criminal justice issues.

• Ambassador-At-Large for Global Women's issues Melanie Verveer will attend the Asia-Pacific Economic Cooperation Women and the Economy Forum in St. Petersburg. Secretary Clinton will join her Thursday.

• In Rome, Assistant Secretary for Public Affairs Mike Hammer will meet with Ministry of Foreign Affairs officials, Italian journalists, and young political leaders.

• Special Representative for Global Partnerships Kris Balderston is in Edinburgh, Scotland, for the TED Global 2012 Conference. She will also meet with private and public sector leaders.

• Ambassador-At-Large to Monitor and Combat Trafficking in Persons Luis CdeBaca is traveling to Switzerland and Morroco.

The biggest single new initiative in the State Department's $51.6 billion budget proposal for next year was a Middle East Incentive Fund -- $770 million in mostly new money to help State respond to the Arab Spring by supporting emerging democracies and their civil societies. But the House of Representatives declined to fund it in their version of the appropriations bill.

The House Appropriations Subcommittee for State and Foreign Ops didn't give any money to fund the initiative in their fiscal 2013 appropriations mark, released last month. The leaders of that subcommittee claim that State failed to give them enough detail about the program to justify the new outlay of funds. Now, the State Department is depending on its allies in the Senate to save the program when the Senate Appropriations Committee marks up its bill next week. The episode is an example of the disconnect between State and Congress over how to respond to the Arab Spring as well as the difficulty of securing new money for diplomatic initiatives in this tight budget environment.

"This is something that Secretary Clinton has really -- and with the President -- has focused principally on," Deputy Secretary of State Tom Nides said in February when announcing the initiative. "The notion is we're in a new world. The Arab Spring has come; we need to make sure we have the tools and the flexibility in which to fund these initiatives. I cannot tell you today where that money will be spent because we'll be, obviously, in consultation with the Hill. We'll be coming up with initiatives that we'll then be discussing with the Hill."

"But this is something we coordinated and talked a lot about with our friends on the Hill, the idea is to have some flexibility to support everything from Tunisia, to support areas like potentially in Egypt and in areas where things are changing every day in Syria, things where changing, the world is evolving as we see it, and we felt it was important to have a pool of money," he said.

At the time, budget experts warned that it would be difficult for the State Department to get Congress to spring for the program because State didn't seem to have a lot of detail about what the money would be used for.

"That will be controversial because there's no content. It's a contingency fund and Congress doesn't like to give State contingency funds," said former Office of Management and Budget National Security Director Gordon Adams at the time.

State did brief all the relevant committees on the new fund and provided as much detail and context as they could, but it wasn't enough for the House subcommittee leaders, Reps. Kay Granger (R-TX) and Nita Lowey (D-NY).

"The administration could not justify the broad authority requested to override existing laws. However, the House bill does provide State some flexible funding to be responsive, within the existing account structure, while increasing congressional oversight on key countries," Granger's spokesman Matt Leffingwell told The Cable.

The "existing account structure" he referred to is the economic support funds that are given each year on a country-by-country basis. Congress prefers granting State country-specific aid because it's easier to track and oversee.

"Congresswoman Lowey supports U.S. engagement in the region and believes we must have the flexibility to respond to rapid changes and developments.  Existing accounts within the bill provide that important flexibility," Lowey's spokesman Matt Dennis told The Cable.

Outside experts working closely on the issue said that the State Department didn't properly explain the new fund or its benefits to Congress and didn't have specific enough proposals to give lawmakers assurance the money would be spent wisely.

"This incentive fund is an important new initiative, but unfortunately it seems the administration has done a pretty poor job of pitching it to the hill. There's a lot of confusion in Congress about what this fund is for and why it's important," said Stephen McInerney, executive director of the Project on Middle East Democracy.

"This fund should be a signature initiative of the administration to respond to the historic events in the region, and these funds could be essential to the administration's ability to respond to events that haven't yet unfolded in places like Syria, where there is no existing U.S. assistance package in the budget," said McInerney.

Using economic support funds is not a great option  because those funds are already devoted to specific causes and diverting them from other places would hurt other priorities, McInerney argued.

"The administration won't be able to use that flexibility without significant cuts to existing programs. Without some support from Congress, it's really tough to get it off the ground," he said.

Tamara Wittes, head of the Brookings Institute's Saban Center on the Middle East, pointed out that within the $770 million State requested for the new fund, it included a $65 million annual request for an existing program called the Middle East Partnership Initiative (MEPI), which is how State has been funding civil society development in the region. So now, MEPI's funding is also at risk.

"Congress may not realize that MEPI funding was embedded in this proposal, but they need to be aware of the impact of their decision on America's ability to partner with citizens in the region who are working for positive change," she said. Wittes was head of the MEPI office and deputy director of State's new Middle East Transitions Office before she left government earlier this year.

The new Middle East Incentive Fund is State's way of trying to shift America's aid approach in the region from the military-dominated focus of the recent decades to an approach focused on the promotion of civil society and political reform, said Wittes.

"We have to look at the overall ratio of our assistance and how that is seen by the people of the region. In order to seize the opportunity that the Arab Spring presents, we need to shift the logic of our relationships to one that emphasizes projects with people," she said.

The fight to save the fund now goes to the Senate, where the Senate Appropriations Committee is set to mark up its State and Foreign Ops bill as early as next week. David Carle, the spokesman for State and Foreign Ops subcommittee chairman Sen. Patrick Leahy (D-VT), told The Cable, "Sen. Leahy does intend to include some amount for the fund, for the reasons the administration requested it -- to provide flexibility to respond to changing events in the ME and NA regions."

The Senate subcommittee hasn't decided how much of the request to support. Their version of the bill could be conferenced with the House version. More likely, Congress will not complete any appropriations bills this year and the two versions will simply inform a temporary funding measure crafted by congressional leadership in late September.

The new fund does have one powerful staunch supporter in Congress, Senate Foreign Relations Committee chairman John Kerry (D-MA).

"This is something that's been percolating a long time on the Hill and in the administration and it's really a no-brainer," Kerry told The Cable in a statement. "We're witnessing a period of historic change in the Middle East, and it's impossible to predict what will happen next month, let alone next year, which is why the State Department should have the flexibility to deal with unforeseen contingencies. Positive incentives for economic and democratic reforms also make sense. American assistance in itself may not convince governments that are resisting reform to change, but in places that have already begun to chart a new course, like Tunisia, Egypt, and Libya, it can help empower moderates and reformers."

The State Department declined to comment.

UPDATE: A reader points out that the House Appropriations State and Foreign Ops subcommittee's report on the bill does direct $70 million to MEPI, separate from the Middle East Incentive Fund. 

Libya's interim Prime Minister Abdurrahim El-Keib met with Secretary of State Hillary Clinton at the State Department Thursday, but let's hope he didn't check the State Department's website, which still has Col. Muammar al-Qaddafi listed as the head of the country.

Sure, the Arab Spring must keep the State Department web teams busy with revisions, but Qaddafi has been dead for months now. You wouldn't know that by reading the State Department's website, though, as it still shows the all-green Qaddafi flag on its Libya page and refers to Libya as the "Great Socialist People's Libyan Arab Jamahiriya." The Libya page was last updated in July 2011, after NATO forces had begun attacking Libya but before the Qaddafi regime fell. (And yes, the State Department gift shop still sells flag pins with the old Libyan flag juxtaposed with the stars and stripes.)

Clinton celebrated the new Libyan government in her remarks after her meeting with Keib.

"Just think, this time last year, the United States was working to build an international coalition of support for the Libyan people, and today we are proud to continue that support as the people of Libya build a new democracy that will bring about peace and prosperity and protect the rights and dignity of every citizen," she said.

"We've seen progress in each of the three key areas of democratic society -- building an accountable, effective government; promoting a strong private sector; and developing a vibrant civil society. And we will stand with the people of Libya as it continues this important work."

Clinton lauded Libya's new election law and endorsed the goal of holding constitutional assembly elections this June. She praised Libya's increasing oil production and acknowledged the country still has a ways to go in the areas of border security, integrating militias, and working toward national reconciliation.

Keib thanked the entire Obama administration "for having been a tremendous support and for their strong leadership in supporting the Libyan revolution," and asked Clinton for help in retrieving the billions that Qaddafi is thought to have stolen from Libya and returning it to the Libyan people.

"In the past year, the dynamics between the U.S. and Libya has been dramatically transformed for the better," he said.

On Wednesday morning, Keib met with President Barack Obama and National Security Advisor Tom Donilon at the White House. He spoke at the U.N. Security Council in the afternoon and attended a dinner at the official residence of U.S. ambassador to the U.N. Susan Rice, sharing a table with actress Angelina Jolie and U.N. Secretary-General Ban Ki-moon.

Keib said Thursday he was not aware of any training camps in Libya for Syrian rebels, as the Russian government has alleged exist, but said he supports the Syrian opposition and formal recognition of the Syrian National Council. Libya has pledged $100 million for the Syrian cause.

Clinton said the Libyan National Transition Council (NTC) could be a model for the Syrian opposition.

"[The NTC] presented a unified presence that created an address as to where to go to help them, a lot of confidence in their capacities on the ground, their commitment to the kind of inclusive democracy that Libya is now building," Clinton said. "And we are working closely with the Syrian opposition to try to assist them to be able to present that kind of unified front and resolve that I know they feel in their own -- on their behalf is essential in this struggle against the brutal Assad regime."

And Clinton was quick to mention that she raised with Keib the issue of the 1988 bombing of Pan Am Flight 108 over Lockerbie, Scotland, and the U.S. desire to see the convicted plotter Abdelbaset al-Megrahi returned to prison.

"You know where I stand. I believe that Megrahi should still be behind bars," she said. "We will continue to fight for justice for all the victims of Qaddafi and his regime. And in this particular case, the U.S. Department of Justice has an open case, and it will remain open while we work together on it."

All three of the lobbying firms representing the Egyptian government in Washington, D.C., dropped Egypt as a client late Friday amid widespread criticism of the ruling military council's raid of U.S. NGOs in Cairo and its refusal to let American NGO workers leave the country.

The Livingston Group, run by former Rep. Bob Livingston (R-LA), the Moffett Group, run by former Rep. Toby Moffett (D-CT), and the Podesta Group, run by Tony Podesta, unanimously severed their combined $90,000 per month contract with the Egyptian government, Politico reported late Friday, quoting Livingston directly. The three firms had formed what is known as the PLM Group, a lobbying entity created to advocate on behalf of the regime of former President Hosni Mubarak, who was deposed in February 2011 after 18 days of massive street protests. According to the disclosure filings, Egypt has paid PLM more than $4 million since 2007.

The trio came under fire last week for circulating talking points defending Egypt's Dec. 29 raid of several NGOs working to train political parties in Egypt, including three organizations partially funded by the U.S. government. The groups had been working in Egypt for years without being technically registered with the government, but now stand accused of fomenting unrest against the Supreme Council of the Armed Forces (SCAF), which has been ruling the country since Mubarak's ouster.

"It is bad enough when the actions of American lobbyists conflict with U.S. national interests. It is far worse when their influence-peddling undermines American values, as the Egyptian government's lobbyists in Washington are doing in this instance," said Sens. John McCain (R-AZ) and Joe Lieberman (I-CT) in a Jan. 24 statement. McCain is the chairman of the board of the International Republican Institute (IRI), one of the groups that had their Cairo offices raided. The other two groups were the National Democratic Institute, whose board is chaired by former Secretary of State Madeleine Albright, and Freedom House.

The anger in Washington against the Egyptian government reached a boiling point when it was revealed Jan. 26 that U.S. Transportation Secretary Ray LaHood's son Sam LaHood, the head of IRI's Cairo office, had been barred from leaving Egypt by the government along with five other U.S. citizens.

"To have an American lobbyist lobbying for a government where these activities are taking place -- is there no shame in this town?" said Rep. Frank Wolf on Thursday.

On Friday, Sam LaHood told NPR that he and the other Americans trapped in Egypt could face criminal charges, lengthy trials, and years of prison time.

"If we are referred to trial," LaHood said. "The trial could last up to a year ... and the potential penalty is six months to five years in jail."

The lobbying groups buckled under the public pressure, recognizing that they couldn't influence the SCAF's actions in this case and that their association with the military council was harming their broader image. For years, these firms have been defending the Egyptian military's $1.3 billion annual aid package on Capitol Hill and lobbying for non-military aid to go through the government, and not directly to independent organizations as many democracy advocates urged.

The Cable reported that in late 2010, Bob Livingston personally called Sen. Roger Wicker (R-MS) to get him to kill a Senate resolution calling for greater respect for human rights and democracy in Egypt. Wicker placed a hold on the resolution and it died in the Senate.

Egypt's lobbyists were also responsible for negotiating an endowment the Egyptian government wanted from the Obama administration. But the Mubarak regime demanded the money be given with no annual Congressional oversight, and the negotiations broke down.

Congress did place new restrictions on military aid to Egypt in the most recent appropriations bill passed in December, as a way of pressing the SCAF to move faster toward handing over its executive powers to an elected government.

According to the legislation, Secretary of State Hillary Clinton must certify that the Egyptian government is living up to the 1979 Egypt-Israel peace treaty and that the SCAF is supporting the transition to civilian rule. Multiple congressional aides told The Cable Friday that the aid is now in serious jeopardy.

"Needless to say, this whole crisis is going to make it a lot more difficult for the secretary of state to meet the certification requirements to continue providing assistance to Egypt," one senior Senate aide told The Cable. "People up here are completely seized with this issue. They're putting their friends in a really awful spot."

Another senior Senate aide noted that the Obama administration is doing a lot of work behind the scenes to deescalate the crisis, which is threatening to do long-term harm to the official U.S.-Egypt relationship.

President Barack Obama brought up the raids in a call last week with SCAF leader Field Marshal Mohamed Hussein Tantawi, according to the White House. Clinton, U.S. Ambassador Anne Patterson, Deputy Secretary of State Bill Burns, National Security Advisor Tom Donilon, and Lahood have been working the phones hard, calling contacts in Egypt to send strong messages and implore them to change course. Assistant Secretary of State for Democracy, Labor, and Human Rights Michael Posner was in Egypt on Jan. 26 and met with high-level Egyptian officials.

"Since the NGO raids in late December, the Obama administration has repeatedly provided paths for the SCAF to deescalate this crisis. Instead they keep escalating -- doubling down on a bad bet that, in the end, will prove ruinous to them," the Senate aide said. "Three weeks ago no one in Congress thought there was a chance in hell that aid to the Egyptian military could ever come under serious threat. It is now an increasingly and shockingly real prospect."

Ironically, McCain and Lieberman had been among the U.S. leaders most supportive of the SCAF and its role in maintaining stability during Egypt's fragile transition.

Many in Washington believe that the SCAF is being heavily influenced on this issue by one civilian Egyptian official, Fayza Abul-Naga, the minister of international cooperation and a holdover from the Mubarak era. In a speech this week, she disavowed the SCAF's previous promises to return the NGOs' raided possessions and cease harassing them as she lashed out at the American NGO groups.

Lorne Craner, the president of IRI, said in an interview Friday with The Cable that there is bad blood between Abul-Naga's ministry and the NGO groups. "Some people say that the people who used to get the money, for example the minister of international cooperation, resent the fact that they are not getting all of the funding," Craner said.

Meanwhile, the Americans and several of their locally hired staffers are enduring hours-long interviews as they await a possible arrest, which would only escalate the crisis.

"Things have gone from bad to worse," Craner said. "You start to think about Americans getting arrested on the streets of Cairo and sitting in a cage in some Cairo court ... And these are our allies."

UPDATE: On Sunday the Egyptian Embassy in Washington issued a statement claiming they dumped the PLM Group, not the other way around:

The Government of Egypt had decided to terminate its contractual relationship with the PLM Group. This decision was transmitted to the Group's principals on January 27^th 2012 through an official letter, as the contract stipulates, that either party has the right to terminate the relation within a 60 days prior notice.

It is surprising that a distorted version of this fact is being circulated in some media outlets. It is equally disturbing that articles and media coverage of the issue were made without an attempt to contact the Egyptian Embassy to check the factual basis of the stories reported.

This Press Release attempts to clarify the situation in line with the official documents related to the matter including the letter of termination which was recently transmitted by the Embassy to the PLM Group. 

Libya's National Transitional Council (NTC) will begin its handover of power and set up elections following the death of Muammar al-Qaddafi, the Libyan ambassador to Washington told The Cable.

"That's what they declared before and that's what they have to do now. Now they have to start work for the election and the institution building for the new Libya," said Ambassador Ali Aujali today.

Aujali also outlined the help that Libya was seeking from the U.S. government and the American business community in the wake of Qaddafi's death. The NTC wants U.S. assistance in training its military, protecting its borders, and setting up the foundations of the new government and civil society. He invited American companies to participate in the reconstruction of Libya.

"Qaddafi was the one who was always an issue and an obstacle to a relationship based on confidence and mutual interest," Aujali said.

He specifically called for U.S. medical aid for injured Libyan fighters, a proposal that senators such as John McCain (R-AZ) have also supported.  Medical assistance was part of the $11 million aid package that Secretary of State Hillary Clinton announced on her visit to Tripoli earlier this week.

(Clinton learned of Qaddafi's death over her Blackberry during a stop in Afghanistan earlier on Thursday.)

Aujali said that Qaddafi was killed by rebel militias and his death was not related to any NATO airstrike missions. He also said that he had heard, but could not independently confirm, that Qaddafi's son Saif al-Islam was dead.

"These types of regimes always end in tragedy," he said.

The Libyan embassy in Washington is tasked with expressing the NTC's gratitude to its American interlocutors for the role the United States played in the months-long struggle against the Qaddafi regime.

"Thanks to the U.S. and NATO and the Arab countries that supported us and came forward to help the Libyan people," Aujali said.

President Barack Obama made brief remarks about Qaddafi's death at the White House this afternoon and called for a quick formation of an interim government and a stable transition to Libya's first free and fair elections.

"You have won your revolution and now we will be a partner as you forge a future that provides dignity, freedom, and opportunity," he said "For the region, today's events prove once more that rule by an iron fist inevitably comes to an end."

The United States is in discussions with the National Transitional Council (NTC) about a possible role for international forces in military training and counterterrorism in the new Libya, according to Assistant Secretary of State Jeff Feltman.

Feltman conducted a press call on Wednesday following his visit to Tripoli, where he met with NTC Prime Minister Mahmoud Jibril, Chairman Mustafa Abdel Jalil, and civil society representatives. There are four U.S. military troops on the ground in Libya now, trying to figure out how to secure the battered U.S. embassy, but Feltman said there's a possibility of more U.S. military cooperation with the new Libyan government.

"There are a number of countries including the U.S. that would look favorably on such as a request.... The Libyans themselves have to make clear what they are comfortable with," Feltman said. "We think the Libyans should find a way to define these missions in a way that are respectful for Libyan sovereignty and independence and also protect Libya's security."

Feltman added that U.S. policymakers "will certainly be encouraging Libya to work with us" on counterterrorism issues, noting that there are U.S. government teams on the ground helping the NTC locate dangerous weapons, such as MANPADS and land mines.

Feltman also addressed concerns that groups associated with the new Libyan government might contain Islamist elements, which could push the new government toward an anti-Western stance.

"The Islamists, as we would probably define them, seem to be a relatively small percentage of both the leadership and the rank and file [of the NTC], as best as we can tell," said Feltman. "It is a very religiously devout population and heavily tribal. The tribal allegiances are kicking in to soften or mitigate or cancel out the more Islamic leanings, pulling those who might go astray back into the tribes."

"The debate over this whole question has shifted significantly, evolving away from the fear that some people had about is the revolution being kidnapped by others, to how do we centralize the demands of the fighters, how best do we build an inclusive system for the interim period that allows people to work out their differences," Feltman explained. "It's really a far different debate than it was even a few weeks ago."

What about the U.S. embassy in Tripoli? Feltman surveyed the scene today, and the building is not looking good.

"I think it's no secret that the building was largely looted and it's in pretty serious damage," said State Department spokesman Mark Toner. "So the assessment is that it's pretty severely compromised, but no decision has been made yet on what we're going to do moving forward in establishing an embassy there."

A State Department team led by the embassy's second-in-command Joan Polaschik arrived in Tripoli this past weekend to reestablish the U.S. diplomatic presence there. Ambassador Gene Cretz remains in Washington leading the State Department's Libya Task Force and envoy to the NTC Chris Stevens remains in Benghazi.

At a press conference in Tripoli, Feltman also admitted the U.S. government worked with the regime of Muammar al Qaddafi to round up terror suspects, many of whom were reportedly tortured. Watch Feltman's explanation here:

The American victims of several terror attacks perpetrated by the regime of deposed Libyan leader Muammar al-Qaddafi are asking the State Department to break off some of Qaddafi's frozen assets and give it to them.

There are about $37 billion of frozen Libyan assets in the United States, some of which were Libyan government funds and some of which were the personal fortune of Qaddafi and his family. When Qaddafi made nice with President George W. Bush's administration, he agreed to pay the U.S. victims of his crimes $1.5 billion in restitution. But now, those victims are saying that isn't enough money to cover the cost of what they were promised, and they want the Obama administration to divert more funds to make up the difference.

"The State Department under President Bush didn't get enough money from Qaddafi to pay the awards. They are likely $200 million to $400 million short," Stuart Newberger, the lead attorney for victims of UTA flight 772, told The Cable. UTA 772 exploded in 1989 over the Sahara desert, killing 171 people, including 7 Americans, one of whom was Bonnie Pugh, wife of the U.S. ambassador to Chad, Robert Pugh. High-ranking members of the Qaddafi regime were implicated in the attack.

The families of the UTA 772 victims, like those of several other Qaddafi attacks, were engaged in litigation against Qaddafi before the State Department made a deal to settle all claims for $1.5 billion. The State Department transferred responsibility for doling out the money to a foreign claims settlement commission run by the Treasury Department in 2008, and dozens of victims are still waiting for their payments.

The victims are entitled to specific awards - such as $10 million if a family member died and $3 million if a family member suffered a severe injury - but their advocates always suspected that the $1.5 billion wasn't enough to cover the awards promised. They also said the State Department underestimated the number of victims of Qaddafi's crimes.

"The issue is how to make sure the awards are paid in full, the way the State Department and the Bush administration intended," said Newberger. "What we want is either the president, the secretary of state, or the Congress to use a very small portion of the frozen Qaddafi assets to be applied to make sure there is no shortfall.  Otherwise, these American victims of Qaddafi's terrorism will get much less than was recommended."

Six members of Congress today asked Secretary of State Hillary Clinton to do just that, in a letter obtained exclusively by The Cable.

"We are concerned that the amount of money not yet distributed from the $1.5 billion Libya Claims Program...may be insufficient to fairly compensate some victims," said the letter, spearheaded by Pedro Pierluisi, Puerto Rico's representative in Congress.

Other signers of the letter were Robert Hurt (R-VA), Eliot Engel (D-NY), Michael Grimm (R-NY), Mario Diaz-Balart (R-FL), and Jean Schmidt (R-OH). They want the State Department to confirm that there will be a shortfall, explain what they plan to do about it, and detail any legal obstacles to using the frozen Qaddafi funds.

The victims and their advocates became especially worried when several victims received a letter on Aug. 25 from the Treasury Department stating that some victims would only be given 20 percent of the money they were promised.

"Treasury is prepared to make an initial payment of $1,000. Treasury is further prepared to make a partial, pro-rata distribution totaling 20% of the unpaid balance that remains on your award," stated the letter, also obtained by The Cable.

Newberger said that paying pro-rata portions is a clear indication that the Treasury is aware there is not enough money in the fund to pay the victims. But he also acknowledged that the administration may not be able to peel off Qaddafi funds for the victims without some backing from Capitol Hill.

"The president probably only has limited legal authority for transferring some of this money," he said. "To make his authority stronger under U.S. law, he really needs Congress to pass a law. If the Congress does that, the president is in a much safer and stronger legal position."

In fact, Sens. Marco Rubio (R-FL) and Johnny Isaakson (R-GA) were able to add an amendment to Sen. John Kerry's bill to authorize the Libya war that directed the administration to use the frozen funds to pay victims. But now that the war is mostly over, that bill has little chance of reaching the Senate floor, much less Obama's desk.

For the administration, it's a no-win situation. If it tries to take the money from the frozen funds, it risks upsetting the Libyan National Transitional Council, which thinks it should decide how to spend Qaddafi's money. If it doesn't act, it could appear to be abandoning the victims of Libya terrorism in the United States.

"They've been very careful not to take a position on this," Newberger said.

The State and Treasury Departments did not respond to requests for comment by deadline.

The victims involved in this effort include those who were part of several Qaddafi-inspired attacks in addition to the 1988 bombing of Pan Am flight 103 over Lockerbie and the bombing of UTA flight 772. They include:

• The 1972 Lod Airport attack in Tel Aviv, where 16 Americans were killed, all from Puerto Rico
• The 1983 car bombing in London, which killed one American and injured several others
• The 1984 and 1985 kidnappings and killings of Peter Kilburn and Alec Collett in London
• The 1985 hijacking of Egypt Air flight 648, where two Americans were killed
• The 1986 hijacking of Pan Am flight 73, where 3 Americans were killed and dozens wounded
• The 1987 detention of one American on the yacht Carin II

Sen. Chuck Schumer (D-NY) is calling for a halt to U.S. aid to the new Libyan government if it refuses to re-arrest Abdel Baset al-Megrahi, who was convicted of planning the 1998 bombing of Pan Am Flight 103 over Lockerbie, Scotland.

Schumer sent a letter to Secretary of State Hillary Clinton today calling on the State Department not to help the National Transitional Council (NTC) -- which is struggling to stand up a government in the wake of the fall of Muammar al-Qaddafi -- with either direct aid or by giving them access to frozen Qaddafi funds, unless it jails Megrahi.

"If the new Libyan government continues to shield this convicted terrorist from justice, then they should not get one more cent of support from the United States," said Schumer. "We put American lives and money on the line to help the Libyan people secure their freedom. It's time the Libyan government lives up to its commitment to create a free and accountable society by handing over al-Megrahi so that justice can finally be done."

Megrahi was released by the Scottish government in 2009 on compassionate grounds, because he was supposedly dying of cancer. He enjoyed a hero's welcome when he returned to Libya and has since stubbornly refused to die on schedule. Since the fall of Qaddafi, Schumer, along with several other senators and GOP presidential candidates, have been calling on the NTC to lock him up.

Mohammed al-Alagi, the NTC justice minister, said on Monday that the senators' request had "no meaning" and that the new Libyan government had no intention of extraditing Megrahi to the United States or anywhere else.

CNN's Nic Robertson actually found Megrahi and visited him in his Tripoli home this week, where he appeared to be slipping in and out of a coma and near death. But Schumer doesn't believe the video or the NTC's claims that Megrahi really is going to die soon.

"This would not be the first time that Libyan officials claimed al-Megrahi was in a ‘near death' state. The American people deserve more verification than the word of local Libyan officials," he said. "There is no justifiable basis for the rebels' decision to shield this convicted terrorist."

Clinton travels to Paris on Thursday for a ministers-level meeting of the Libya Contact Group. The State Department won't say whether it will press the NTC on the issue but the Justice Department maintains that the Lockerbie investigation is still open and active.

Full text of Schumer's letter after the jump:

Read on

This week's toppling of the Qaddafi regime in Libya shows that the Obama administration's multilateral and light-footprint approach to regime change is more effective than the troop-heavy occupation-style approach used by the George W. Bush administration in Iraq and Afghanistan, a top White House official told Foreign Policy today in a wide-ranging interview.

"The fact that it is Libyans marching into Tripoli not only provides a basis of legitimacy for this but also will provide contrast to situations when the foreign government is the occupier," said Ben Rhodes, deputy national security advisor for communications, in an exclusive interview on Wednesday with FP. "While there will be huge challenges ahead, one of the positive aspects here is that the Libyans are the ones who are undertaking the regime change and the ones leading the transition."

Despite criticism from Congress and elsewhere, President Barack Obama's strategy for the military intervention in Libya will not only result in a better outcome in Libya but also will form the basis of Obama's preferred model for any future military interventions, Rhodes said.

"There are two principles that the president stressed at the outset [of the Libya intervention] that have borne out in our approach. The first is that we believe that it's far more legitimate and effective for regime change to be pursued by an indigenous political movement than by the United States or foreign powers," said Rhodes. "Secondly, we put an emphasis on burden sharing, so that the U.S. wasn't bearing the brunt of the burden and so that you had not just international support for the effort, but also meaningful international contributions."

Rhodes said that the United States is not going to be able to replicate the exact same approach to intervention in other countries, but identified the two core principles of relying on indigenous forces and burden sharing as "characteristics of how the president approaches foreign policy and military intervention."

Rhodes also weighed in on several other aspects of the Libya saga:

• Rhodes confirmed the comments by U.S. Ambassador to the United Nations Susan Rice on Tuesday that the TNC can choose whether to prosecute Muammar al-Qaddafi themselves or hand him over to the International Criminal Court, which has indicted him on war crimes. ICC prosecutor Luis Moreno-Ocampo, however, has argued that the decision is not up to the Libyans.
• "We believe it's something that the Libyans and the [Transitional National Coalition], were they to capture Qaddafi, would then be in charge of, in consultation with the ICC," said Rhodes. "Were he to go to any third country, they would have an obligation to turn him over to the ICC."
• On the role of the NATO operation in Libya, Rhodes said the civilian protection mission continues but that consultation will soon begin in Brussels on the conclusion of the mission. The need for the NATO protection mission is still present for now, Rhodes said, but the White House doesn't anticipate the TNC requesting a peacekeeping force from NATO or the United Nations that involves any foreign boots on the ground. "There's no plan for that type of effort," he said.
• Rhodes said the drive to release between $1 billion and $1.5 billion of Qaddafi's frozen assets to the TNC is moving along quickly. "We think that should be complete in the next few days and we don't foresee an insurmountable problem there," he said. The Obama administration feels confident the TNC can manage the money and prevent it from being stolen or funneled to unsavory actors. The administration will also try to ensure the money goes to the urgent needs identified by the TNC.
• Rhodes also addressed the effects the developments in Libya may have on Syria, saying that "it sends a message to Damascus that a crackdown of the sort that Qaddafi and [Syrian President Bashar al-] Assad have pursued is not a means of maintaining legitimacy and staying in power in the long run."
• Rhodes said that a transition to democracy in Syria is in the U.S. national interest, and would weaken Iran's ability to influence regional events. "The Iranians have suggested that the Arab Spring was somehow a positive development for Tehran, the fact you see their principal ally in the region having completely lost legitimacy... would be a blow to Iran," he said. But he emphasized that the administration does not see a military intervention in Syria as the right step.
• On the fate of Lockerbie bomber Abdelbaset Mohmed Ali al-Megrahi, who senior lawmakers and GOP presidential candidates said on Tuesday should be re-arrested and extradited to the United States, Rhodes said the extradition issue was a legal question for the Justice Department, "but the president never thought he should have been released in the first place ... so that continues to be our view."

President Barack Obama spoke on Monday evening with Turkish Prime Minister Recep Tayyip Erdogan and the two agreed that NATO should have a command and control role in the Libya war, according to a White House read out of the phone call. But today in Brussels, the French government said it doesn't agree.

"The President and the Prime Minister reaffirmed their support for the full implementation of United Nations Security Council Resolutions 1970 and 1973, in order to protect the Libyan people," the White House said. "The leaders agreed that this will require a broad-based international effort, including Arab states, to implement and enforce the UN resolutions, based on national contributions and enabled by NATO's unique multinational command and control capabilities to ensure maximum effectiveness."

The Turkish government has been very clear that it does not support NATO-led enforcement of the no-fly zone over Libya if the mission goes beyond the U.N.-sanctioned objective of protecting Libyan civilians.

"We do not want Libya to become a second Iraq.... A civilization in Iraq collapsed within eight years. More than a million people were killed there," Turkey's daily Hürriyet newspaper quoted Erdogan as saying on Monday on the way back from Saudi Arabia. "We will not participate with our fighting forces. It is impossible for us to think that our fighters would drop bombs over the Libyan people."

Turkey laid out its position at Tuesday's NATO meeting in Brussels. The Turks are still upset they were not invited to the Paris planning meeting on March 19, the day the air strikes began. Turkey has also taken over as the protecting power of the U.S. in Tripoli, meaning they would be in charge of direct interactions with the Libyan government and responsible for the abandoned U.S. embassy, their government announced on Monday.

Meanwhile, French President Nicolas Sarkozy said on Tuesday that France now opposes NATO taking over the Libya mission. The French and German representatives reportedly stormed out of the Monday meeting in Brussels over disagreements about NATO's role, albeit for very different reasons. Germany is opposed to the military intervention altogether.

The confusion is causing problems for the rest of the coalition as well. Norway said Tuesday it was "suspending" its promise to use F-16 fighter jets in combat in Libya until the command structure issue was worked out, even though its jets had already arrived at the staging base in Italy.

All of this puts into question the viability of Obama's pledge on Monday that the U.S. will transfer command of the military mission in Libya in "a matter of days."

Adding to the questions over the endgame, Obama and Erdogan also "underscored their shared commitment to the goal of helping provide the Libyan people an opportunity to transform their country, by installing a democratic system that respects the people's will," the White House said.

The Obama administration was caught by surprise on Thursday night when President Hosni Mubarak spoke to the Egyptian people and initially declined to step down as leader of the country. Following the speech, Defense Secretary Robert Gates and Joint Chiefs Chairman Adm. Mike Mullen quickly phoned their counterparts in the Egyptian military.

Today, the military assumed control of the Egyptian government and Vice President Omar Suleiman announced in a recorded statement that Mubarak had stepped down from the presidency. "Secretary Gates spoke with [Defense Minister] Field Marshal Mohamed Hussein Tantawi again last night," Pentagon press secretary Geoff Morrell confirmed to The Cable.

"It was his fifth phone conversation with the Egyptian defense minister since the situation in Egypt began."

Captain John Kirby, spokesman for the Joint Chiefs, confirmed to The Cable that Mullen called Egyptian Army Chief of Staff Lt. Gen. Sami Anan following the Mubarak speech. Mullen and Anan have spoken four times since Jan. 25, and the last call before Thursday night was on Saturday, Feb. 5, Kirby said.

Both Morrell and Kirby declined to give details on the substance of the calls.

Press secretary Robert Gibbs told reporters on Friday morning that President Barack Obama did not call Mubarak after the speech. The last reported call between Vice President Joseph Biden and Suleiman was Feb. 8, when Biden pressed Suleiman to expand his dialogue with opposition groups.

The Gates and Mullen phone calls are emblematic of the sustained but quiet engagement with their military counterparts that the Pentagon has been undertaking throughout the crisis. That effort has been especially important in recent days, as the military's role has increased and its allegiances have come under closer scrutiny.

The Pentagon even sent out a quiet request to scores of U.S. military officers last week, asking them to contact any Egyptian military members they might know through past associations at American military colleges, the Washington Post reported.

The officers weren't told to deliver any specific messages. The outreach has been rather about collecting information from the Egyptian military and making sure that the military-to-military relationship remained intact, a Pentagon official said, adding that similar outreach has occurred between the Pentagon and its interlocutors in other countries, including Israel.

The White House and the State Department have disagreed on how much pressure to place on Mubarak and Suleiman. The Pentagon has sided mostly with State, arguing for more support of existing Egyptian institutions of power, especially the military. Some observers see the Pentagon as inclined to favor supporting the Egyptian military due its own interests and natural institutional biases.

"The Pentagon is simply so used to letting the Egyptian military have what they want," said one former U.S. official who dealt with the Pentagon on Egypt. "The Pentagon has wanted to keep their involvement at a strictly military-to-military level. So they are reluctant to be part of diplomacy at the top level, but insistent in being engaged in their own diplomacy for their own interest."

Regardless, the direct intervention of top Pentagon and U.S. military officials at key times throughout the crisis may have influenced the Egyptian military's behavior at key junctures, such as when the Egyptian military was implicated in the crackdown of journalists and human rights activists last weekend. Pentagon officials believe their outreach contributed to the relative restraint of the Egyptian Army.

It's unclear whether Gates and Mullen's telephone diplomacy last night actually influenced the events that unfolded only hours later. But the Pentagon's relationships with the Egyptian military are now among the most crucial avenues of communication and influence for U.S. policy toward Egypt going forward.