The Cable

Senate Budget Committee cuts foreign aid request despite pleas from everybody involved

The Senate Budget Committee approved a resolution Thursday that cuts the foreign affairs budget by $4 billion, to the chagrin of everyone else involved in the foreign affairs budget debate.

"Our objectives in Afghanistan, Pakistan, and Iraq and the civilian component of our national security strategy depend on a strong budget and these cuts are an enormous mistake," Senate Foreign Relations Chairman John Kerry, D-MA, said in a statement, "In this difficult budget climate, we all have to make tough choices, but the international affairs account is a smart, cost-effective investment that should be funded appropriately.  Short-changing these programs delivers very little budget relief at enormous cost to our global efforts and America's leadership in the world."

The U.S. Global Leadership Coalition has compiled the letters calling for a robust foreign affairs budget on its website, which included signatures from over 150 representatives and 31 senators.

Defense Secretary Robert Gates wrote to Senate Budget Committee chairman Kent Conrad, D-ND, on Wednesday calling on him to fully fund the administration's $58.5 billion request for State and USAID for fiscal 2011.

"I believe that full funding of these two budget accounts is necessary for our national security and for ensuring our continued leadership in the world," Gates wrote.

Secretary of State Hillary Clinton wrote to Conrad on Tuesday to point out that the increases requested are relatively modest and go mostly to supporting the increased State and USAID role in Iraq and Afghanistan.

"Full funding in FY11 will allow us to continue making tangible progress in securing the hard fought gains achieved in Iraq, and to continue supporting and deploying hundreds of civilians in Afghanistan and Pakistan to help stabilize dangerous but improving situations," she wrote.

The budget request still has many twists and turns to go through before it finally comes out on the other side of the legislative process. The House appropriations committee is expected to mark up its appropriations bill in May. And while it's possible appropriators could restore funds, that's going to be a difficult sell in a year where the fiscal outlook is not good and the political focus is on domestic problems.

"We're going to be a strong an advocate as we can be, but with 10 percent unemployment, urgent needs at home, a trillion-dollar budget deficit, and focus on creating jobs, there is no doubt that these factors make it a difficult political environment for expanding our foreign assistance and development budgets," Rep. Nita Lowey, D-NY, the chairwoman of the House Appropriations State and Foreign Operations subcommittee, told The Cable in February.

The Cable

Obama's development reviews still at odds after high level meeting

Following the highest-level meeting yet on Barack Obama's as-yet-unsettled development policy, there is still no resolution of some key differences between the State Department and the National Security Council, multiple sources told The Cable.

The meeting came as some in the development community expressed a mix of encouragement at the high-level attention and frustration at the administration's failure thus far to express a clear vision laying out the overarching goals of U.S. development policy.

The Tuesday Deputies Committee meeting was supposed to resolve differences between State's overall policy review, the Quadrennial Diplomacy and Development Review (QDDR), led by Deputy Secretary Jack Lew and USAID Administrator Rajiv Shah, with heavy input from Policy Planning chief Anne-Marie Slaughter, and the NSC's Presidential Study Directive on Global Development Policy (PSD-7), led by top NSC aides Gayle Smith, Michael Froman, and Jeremy Weinstein. Following the meeting, there is still no firm schedule for releasing the QDDR interim report, which had been expected.

While it's not clear what all the differences are right now between the QDDR and the PSD-7 --and the two reviews serve different functions -- one issue in dispute is whether or not there should be an independent body to oversee and evaluate all development programs and policies established outside the State Department. Sources said President Obama has shown personal interest in the reviews and has had meetings to talk about foreign assistance reform, but it's not clear at what level of detail.

Senate Foreign Relations Committee chairman John Kerry, D-MA, and ranking member Richard Lugar, R-IN, called for the creation of the new independent group, which would be known as the Council on Research and Evaluation of Foreign Assistance (CORE), in their foreign aid legislation.

"We need a better way to evaluate which development programs work, which have minimal impact, and what factors determine success or failure. Our current system is unable to provide this analysis," a committee fact sheet on the bill explains. "This evaluation group would be based in the executive branch, but it would operate independently under the auspices of an interagency board."

Congressional sources said that they aren't expecting the interim report soon because they were told they would be briefed before the release and no briefing has yet been scheduled.

"State was looking to brief us very soon and now because of the fact that there wasn't a resolution [at the deputies meeting], the schedule is being re-evaluated," one congressional aide said.

Patrick Cronin, a former USAID official now with the Center for a New American Security, said that although the meeting didn't resolve all tensions between the QDDR and PSD, that doesn't mean the process isn't a healthy one.

"It seemed to be a positive meeting on both sides in many ways. But bureaucratically there are some tough fights," he said. "If you make the strong case for development, you are already in tension with a State Department that wants to put all development within the umbrella of State Department policy."

Sources tell The Cable that State is adamant about retaining oversight of development policy and that Secretary of State Hillary Clinton may become personally involved in advocating for that position -- motivated in part by a desire to amass as many budget resources under Foggy Bottom's umbrella as possible. Ultimately, President Obama will have to decide whether to side with State or the NSC, according to these sources, who are not directly involved in the process.

Meanwhile, the question of how the State Department wants to implement its stated goal to "integrate" the diplomacy and development missions is crucial, as many observers worry that development could become subsumed by the State Department's overall foreign-policy agenda.

Paul O'Brian, vice president for policy at Oxfam America, said it was important that both the QDDR and the PSD-7 avoid subordinating long-term development goals like access to education and clean water to U.S. security needs.

"People are going to look very hard at both documents and ask: Is the State Department serious about elevating development or is it politicizing it?"

"You have to be serious about development for development's sake."

USAID is already reconstituting the policy planning staff that it lost years ago and Administrator Rajiv Shah is expected to announce that formally in the coming weeks. But the question of whether or not USAID will get control of its budget, now under the purview of Deputy Secretary Jack Lew, remains unanswered.

The QDDR interim report, which covers "Phase 1" of the process, is not expected to address that issue directly.

"Phase 1 of the process was a strategic thinking exercise involving State, USAID, other U.S. Government agencies, and external stakeholders," reads a new State Department fact sheet on the QDDR. Phase 2 is focusing on the operational and institutional changes required to develop recommendations and put them into practice." 

State says the final QDDR report will be out in September.

The need to reform USAID and the overall U.S. approach to development and foreign aid is the one thing that all sides can agree on.

"Many describe U.S. aid programs as fragmented, cumbersome, and not finely tuned to address the existing needs and U.S. national security interests," the Congressional Research Service wrote in an April 12 report.

"Criticisms include a lack of focus and coherence overall, too many agencies involved in delivering aid with inadequate coordination or leadership, lack of flexibility, responsiveness and transparency of aid programs, and a perceived lack of progress in some countries that have been aid recipients for decades."

NSC spokesman Mike Hammer declined to comment, citing the NSC's policy of not talking about internal meetings.