The Cable

State Department budget request may be dead on arrival on Capitol Hill

The new fiscal 2012 budget request for the State Department and USAID made some tough choices, including ending or cutting foreign assistance to dozens of countries and delaying the goal of increasing the number of foreign service officers by 25 percent for years. But those cuts could be become much more drastic when Congress takes its turn slashing diplomacy and development funding for next year.

"We recognize that these are exceptionally tight times. With the resources outlined in this budget, the State Department and USAID can continue to protect our interests, project our values, promote growth, and above all, serve our national security," Deputy Secretary of State Thomas Nides told reporters at Monday's State Department budget briefing.

Development advocates praised the Obama administration's new budget request, arguing that it tackled the issue of government waste while still protecting the diplomatic and development programs that are crucial to U.S. national security. But they also warned the request may be dead on arrival in Congress.

"After two years of planning, review and reform, the Obama team has readied itself to make the best case possible for a robust international affairs budget," wrote Anne Richard, vice president of the International Rescue Committee, on the Stimson Center's budget blog.

"The good news: the departments and agencies that run these programs are better prepared than ever before to justify their budgets.  The bad news: that may not matter."

The State Department is comparing its fiscal 2012 budget request numbers to fiscal 2010 levels because Congress has not passed a fiscal 2011 budget, even though the fiscal year began Oct. 1. The government has been running on a continuing resolution (CR) since then, which will expire March 4. The House unveiled an extension for the CR, which would provide funding for the rest of the fiscal year. Under the CR, State and foreign operations would receive $44.9 billion in fiscal 2011.

Secretary of State Hillary Clinton met with House Speaker John Boehner (R-OH) on the Hill on Monday morning and emerged from the meeting expressing grave concerns about the House's plans to slash fiscal 2011 spending for diplomacy and development in the 2011 CR, which would set a lower baseline for the 2012 budget as well.

"We would be forced to scale back significantly our mission in the frontline states of Iraq, Afghanistan, and Pakistan, where we work side by side with the American military. We would also be required to roll back critical health, food security, climate change, border security, and trade promotion efforts abroad as well," Clinton said. "We certainly understand the tight budget environment... But the scope of the proposed House cuts is massive."

In a Monday letter to House Appropriations Committee chairman Harold Rogers (R-KY), Clinton wrote that the proposed cuts, "will be devastating to national security, will render us unable to respond to unanticipated disasters, and will damage our leadership around the world."

A news release by House Appropriations State and Foreign Ops subcommittee Chairwoman Kay Granger (R-TX) praised the $44.9 billion figure and said it was a reduction of $3.8 billion, or 8 percent from total 2010 appropriations and a reduction of $11.7 billion, or 21 percent, from the president's 2011 budget request. Granger and GOP congressional leaders are promising to cut Obama's 2012 request even further.

Granger's Democratic counterpart, Rep. Nita Lowey (D-NY), issued a statement on Monday railing against the House Republicans' bill, hammering home the argument that diplomacy and development funding are key to national security.

"Even in these difficult economic times, we cannot afford to enact broad and haphazard cuts to key pillars of our national security. We must not allow our response to an economic challenge to create a national security crisis," Lowey said.

The entire State Department and USAID fiscal 2012 budget request, which can be found here, seeks just over $47 billion, which the Office of Management and Budget notes is a 1 percent increase over fiscal 2010 levels. The president is requesting a grand total of $50.9 billion for U.S. diplomacy and development efforts, after accounting for programs outside State and USAID, such as the Peace Corps, the Broadcasting Board of Governors, and the Millennium Challenge Corporation. That's $3.7 billion -- or 6.7 percent less -- than the $54.6 billion that was requested for the same accounts in fiscal 2011.

Obama is also requesting $8.7 billion in supplemental funding for the State Department and USAID in fiscal 2012, so that they can take on increased roles in Iraq, Afghanistan, and Pakistan. This represents a $2.3 billion increase over the fiscal 2011 request.

"We had to make tradeoffs. We had to cut some things to grow other things," Nides said. "The amount of money we are requesting reflects what we believe are the priorities for this department... This is a national security budget."

The State Department and USAID's plan to increase its cadre of foreign service officers by 25 percent, which was supposed to be completed in fiscal 2012, will now be delayed until at least fiscal 2014.

The administration eliminated or scaled back requested funding for dozens of small foreign assistance programs around the world. The request would eliminate funding for bilateral programs for six countries: North Korea, Tonga, Kuwait, Qatar, Saudi Arabia, and the UAE, for a total savings of $4.5 million. The funds allocated for North Korea -- which was being used to fund non-governmental organizations, not the North Korean government -- could still come out of general funds.

International Military Education and Training (IMET) program funding in the budget was abandoned for nine countries: Equatorial Guinea, Iceland, Kuwait, Madagascar, Qatar, Russia, Saudi Arabia, Somalia, and the UAE. These cuts represent a savings of under $1 million. Foreign Military Financing was eliminated in the request for Chile, Haiti, East Timor, Malta, and Tonga, for a savings of about $5 million.

"We're trying to move our budget toward less very small programs, because we are going to have less money down the road to allocate and we want to make sure we allocate it to the highest priorities," a State Department official said. "So the savings from these cuts are very small but you have to start somewhere."

Funding requested for Mexico assistance is $335 million, $250 million less than fiscal 2010, $282 million of which is designated for the Merida initiative. $400 million is requested for aid to Columbia. Both of these accounts were reduced because the programs are being transferred to more local control, a State Department official said.

Big cuts were proposed to development assistance to over 20 countries, including many in Europe, Eurasia, and Central Asia.

"Countries like Albania, Macedonia, Montenegro, Serbia, Cyprus, Poland, are all countries that we think we just can't afford to give the kind of assistance we have in the past," a State Department official said. "We can't fund everything, everywhere, any longer."

The administration requested $1.55 billion in aid to Egypt and $100 million in aid for the Lebanese Armed Forces, both at about the same levels as fiscal 2010.

AFP/Getty Images

The Cable

Obama cuts foreign assistance to several countries in new budget request

President Obama's newly released budget request for fiscal 2012 proposes cuts to a wide range of State Department and foreign-operations programs, including the complete elimination of foreign assistance and military training to several countries.

The White House's fiscal 2012 budget seeks just over $47 billion for the State Department and the U.S. Agency for International Development, which the Office of Management and Budget notes is a 1 percent increase over fiscal 2010 levels. The president is requesting a grand total of $50.9 billion for U.S. diplomacy and development efforts, after accounting for programs outside State and USAID, such as the Peace Corps, the Broadcasting Board of Governors, and the Millennium Challenge Corporation. That's $3.7 billion -- or 6.7 percent less -- than the $54.6 billion that was requested for the same accounts in fiscal 2011.

The bill that would determine fiscal 2011 funding has not yet been passed because both Democrats and Republicans have failed to pass a budget for the fiscal year that began Oct. 1, 2010. The government has been running on a temporary continuing resolution (CR), which has kept spending at fiscal 2010 levels. The extension of the resolution, set to expire on March 4, has been at the center of the debate of how to slash non-security discretionary funding for the rest of fiscal 2011.

Obama is also requesting $8.7 billion in supplemental funding for the State Department and USAID in fiscal 2012, so that they can take on increased roles in Iraq, Afghanistan, and Pakistan. This represents a $2.3 billion increase over the fiscal 2011 request.

Inside the regular budget, the State Department eliminated foreign aid to several countries and slashed requested 2012 funding for assistance to Europe, Eurasia, and Central Asia by $115 million from the fiscal 2011 request.

"Although not subject to a freeze in funding, the department is committed to finding efficiencies, cutting waste, and focusing on key priorities. Accordingly, foreign assistance to several countries has been eliminated," the summary sheet on the State Department's request stated, adding that the cuts were made "in order to focus funding on regions with the greatest assistance needs."

The cuts will not only affect development aid, but also the United States' military-to-military relationships across the globe. If the president's budget is enacted, five countries will no longer receive Foreign Military Financing and nine countries will no longer receive support for joining the International Military Education and Training (IMET) program, which is where foreign military officers receive training in the United States and forge bonds with their American counterparts. The countries for which the State Department will no longer seek funding will be made public when the full State Department budget request is released Monday afternoon.

"Several countries will no longer receive bilateral security assistance funding, as resources are being focused on countries with strategic significance," the document stated. "Requested security assistance funds will become more focused on key priorities including program funding for Israel, Pakistan, and other coalition partners and allies, as well as programs that are critical to containing transnational threats including terrorism and trafficking in narcotics, weapons, and persons."

Requested funding for African Development and Inter-American Foundations was reduced by 20 percent in the new budget. Compared with the president's 2011 budget, many other programs face significant reductions in the State and foreign-ops request.

The president requested $3.54 billion for international organizations and peacekeeping, $239 million less than requested for fiscal 2011. One of the largest proposed cuts came from the economic support fund, a program to support countries moving toward democracy, which would receive $5.97 billion in fiscal 2012 -- $1.84 billion less than last year's request. The International Law Enforcement and Narcotics Bureau (INL) would only receive $1.51 billion in the 2012 request, $624 million less than was requested for 2011.

Although overall USAID funding remained largely flat, some parts of the organization actually received increases in the 2012 request. The president's budget proposal requested $1.5 billion for operating expenses, slightly higher than last year, and $8.7 billion for global health and child survival -- about $200 million more than was requested for fiscal 2011 and about $900 million more than what was allocated in fiscal 2010.

Of course, nobody knows what the fiscal 2011 funding levels will be, because congressional Democrats failed to pass an appropriations bill before the fiscal year began on Oct. 1. The House Republican leadership released its overall allocations for the next CR on Feb. 11, which would provide a total of $44.9 billion for the State Department and foreign operations for fiscal 2011.

A news release by House Appropriations State and Foreign Ops subcommittee Chairwoman Kay Granger (R-Texas) praised the $44.9 billion number and said it was a reduction of $3.8 billion, or 8 percent from total 2010 appropriations and a reduction of $11.7 billion, or 21 percent, from the president's 2011 budget request. Granger and GOP congressional leaders are promising to cut Obama's 2012 request even further.

"The reductions made to my section of the bill are a good start. As long as I am Chairwoman of the State and Foreign Operations Subcommittee, I will ensure that our foreign aid is not used as a stimulus bill for foreign countries.  This bill is about our national security and the funding levels reflect that," Granger's statement read.

The new continuing resolution still has a long way to go before it becomes law. But if enacted as the House GOP leadership wants, it would slash U.S. funding for international financial institutions, eliminate U.S. contributions to several international funds, and cut allocations for global health and childhood survival programs by $784 million compared with fiscal 2010. USAID would also face a $121 million cut to its operating budget as compared with fiscal 2010 under the current House GOP plan.

Funding for international financial institutions was hit especially hard in the GOP bill, with a cut of $892 million from fiscal year 2010 levels. Funding for global health and childhood survival programs also took a hit, losing $784 million compared with 2010.

"Targeted cuts to the bill were partially made by rescinding funds from appropriations that remain unspent, freezing federal employee pay raises at the State Department, not funding programs that require authorizations, scaling back contributions to the United Nations and other international organizations, and eliminating wasteful, duplicative and ineffective programs," Granger said.

The lawmakers proposed keeping aid to Egypt and Israel intact. However, the continuing resolution would cut off foreign aid to the Lebanese armed forces unless Secretary of State Hillary Clinton certifies such funding is in the United States' national security interest.

Typos corrected, 13:25, Feb. 14, 2011