The Cable

Cornyn places hold on Obama confidant Lippert over Taiwan F-16 sales

Now that Sen. John McCain (R-AZ) has lifted his hold on Obama confidant Mark Lippert to become the next top Pentagon official for Asia, Sen. John Cornyn (R-TX) has stepped in with a hold of his own, over the issue of selling F-16 fighter jets to Taiwan.

"Earlier today Senator Cornyn placed a hold on the nomination of Mark W. Lippert, a former aide to President Obama, to be assistant secretary of defense for Asian and Pacific security affairs," said Cornyn spokesman Drew Brandewie. "In November Senator Cornyn sent a letter to the president requesting a plan to address Taiwan's aging fleet of fighter jets. The administration finally responded yesterday, but failed to adequately address Senator Cornyn's underlying concern."

The Lippert hold, first reported by the Washington Free Beacon, is not the first time Cornyn has used his power to hold nominees to press his advocacy for selling F-16s to Taiwan. Last July, Cornyn held up the nomination of Deputy Secretary of State Bill Burns until Secretary of State Hillary Clinton agreed to make a decision on selling the fighter plane to Taiwan.

In October, the administration decided to sell Taiwan upgrade packages for its aging fleet of F-15 A/B model planes but the administration never said whether it would sell Taiwan the newer, more advanced planes, claiming it is still under consideration.

At Lippert's November confirmation hearing, Cornyn pressed Lippert on the issue (watch the video here) and then introduced an amendment to the defense authorization bill that seeks to force the administration to sell Taiwan new F-16s. That amendment had been voted down in the Senate once before.

Cornyn then wrote a letter threatening to hold the Lippert nomination unless he gets some satisfaction on the issue.

"I remain disappointed by your de facto denial of Taiwan's request to 66 new F-16 C/D fighter aircraft, and I believe it sends a damaging message to nations in the Asia-Pacific region and beyond that the U.S. is willing to abandon our friends in the face of Communist China's intimidation tactics," Cornyn wrote. "I hope to be able to support the confirmation of this nominee [Lippert]. However, I ask that you decide on a near term course of action to address Taiwan's looming fighter shortfall and provide me with the specific actions you plan to take."

In the administration's Feb. 16 response to Cornyn, acting Undersecretary of Defense for Policy Jim Miller wrote, "We believe the F-16 A/B upgrade effectively meets Taiwan's current needs."

Miller would be Lippert's boss at OSD if Lippert does eventually get confirmed. Miller also faces a confirmation vote in the Senate as he seeks to permanently replace the now-departed Michèle Flournoy.

The Cable

State Department hosting massive business conference

Next Tuesday, the State Department will convene its largest business conference ever, bringing together business representatives from over 100 countries to discuss how the U.S. government can help them succeed.

State's first Global Business Conference will be held over two days and will bring together senior officials from the White House, the Departments of State, Commerce, Treasury and Energy, the Office of the U.S. Trade Representative, the Export-Import Bank, the Overseas Private Investment Corporation, and the U.S. Trade and Development Agency to meet with the visiting business leaders and leaders of U.S. trade and industry associations operating abroad.

"The idea is to talk about what the government can do, and what the State Department through its embassies can do, to support American businesses abroad," said Robert Hormats, the undersecretary of state for economics, energy, and the environment, in an interview with The Cable.

State wants to leverage the U.S. diplomatic presence around the world to help American companies increase exports, encourage foreign direct investment in the United States, and ensure American businesses are not robbed of their intellectual property and business secrets when operating abroad. This is all part of Secretary of State Hillary Clinton's economic statecraft agenda, as she announced in a speech last October.

"We want to make sure that by engaging with these people, we are responsive to their needs and their concerns, and they have a sense of what we in our government are able to do," Hormats said.

Clinton, Commerce Secretary John Bryson, U.S. Chamber of Commerce President Thomas Donohue, and Boeing Chairman James McNerney will all speak on the first day, which will also include panel discussions and small group meetings on export promotion, increasing foreign investment in the United States, creating public-private partnerships, and facilitating business and leisure travel to the United States. The second day of the conference will include breakout sessions hosted by the State Department's regional assistant secretaries to discuss regional strategies to advance shared economic interests.

"The bottom line is we want to support the ability of the American companies to create private sector jobs in the United States. And second, strengthening our international economic policy by working with American business strengthens our economy at home and complements other aspects of our foreign policy," said Hormats.

Most of the guests will be business facilitators, such as American chambers of commerce or business associations that operate abroad. There will be some individual companies in attendance as well.

Hormats said some embassies, such as in Saudi Arabia, the UAE, and Turkey, have already been proactive in supporting U.S. businesses and have achieved results..

"In Saudi Arabia, the number of small and medium enterprises for whom the embassy has advocated has gotten a lot of business. There are a substantial number of small- and medium-sized American businesses that are doing business there that weren't two years ago," he said. "What we're trying to do in particular is to identify some of the fast-growing economies and make a really strong effort there."

The key elements of the new push for international business focus on sectors like infrastructure, healthcare, information technology, insurance, financial services, construction, and transportation equipment, he said.

"We really want the people from abroad to give us ideas on what's important to look at," said Hormats.

One development that is impacting the environment for American businesses abroad is the Arab Spring, and one of the breakout sessions is specifically designed to focus on the effects of government instability in the Middle East and North Africa.

Another focus will be how to deal with countries with economic systems that are state-controlled, which can hinder foreign companies' ability to compete fairly with government- supported local firms.

"Our worry is that state enterprises and state-supported enterprises get an inordinate amount of support from their governments, which distorts competitiveness," said Hormats. "That's definitely one of the big challenges for the United States and it puts our companies at a disadvantage."

In the end, Hormats said the American economic model ultimately will win out, as long as the United States does not stop attracting the world's best and brightest.

"We still have a culture that's very innovative, we have an entrepreneurial culture, one where upward mobility is a hallmark of what we're doing. But we also have to work hard to continue to reinforce our strengths, which means more emphasis on education, infrastructure, and research and development," he said. "We really are seeing competition among systems."