The Cable

State Department’s new Middle East fund falls victim to Capitol Hill dysfunction

The State Department's biggest new program in its fiscal 2013 budget was a $770 million new fund to help America's diplomats and aid workers respond to the Arab Spring -- but Congress didn't fund it in the latest continuing resolution.

Called the Middle East incentive fund, the program was touted by senior State Department officials when the administration rolled out its budget in February. Though a small fraction of the State Department's $51.6 billion budget proposal, the fund was meant to support emerging democracies in places like Egypt, Tunisia, and Libya, where the ongoing fallout of the 2011 uprisings has come into sharp focus this month.

"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."

In May, the House Appropriations Committee declined to support the new fund in its version of the appropriations bill, claiming that the administration had failed to provide enough detail about the new program. Senate Appropriations State and Foreign Operations subcommittee Chairman Patrick Leahy (D-VT) came to the fund's defense and put $1 billion in the Senate's version for the fund.

But neither of those mark-ups were used in the continuing resolution (CR) that Congress passed in the wee hours of Saturday morning to keep the government running from October to March. The CR largely just continues authorities for existing programs, but there wasn't room for a new fund of the size and scope envisioned by the State Department.

"That's one of many many casualties of putting the budget on autopilot," Leahy spokesman David Carle told The Cable. "The six-month continuing resolution doesn't reflect the enormous work this year by the Senate and House State-Foreign Ops panels to update the current FY12 appropriations for changing needs and conditions.  Senator Leahy has been highly critical of this robotic approach and its implications for U.S. security and foreign policy interests."

The consequence of not starting the new program, experts say, is that the United States will have reduced influence in emerging Middle East democracies and that those countries will have less support in their effort to build stable, moderate, and secular civil societies.

"This is Congress making the administration limp along in its response to the Arab Spring. It's a missed opportunity," said Tamara Wittes, head of the Brookings Institution's Saban Center and a former deputy assistant secretary of state for the region.

The lack of congressional support shouldn't necessarily be seen as a policy statement by Congress because a true debate about the fund was never allowed to happen, she cautioned. Nevertheless, the next opportunity for the fund would come next March and a lot could happen in the region between now and then.

"It's very difficult in an election season to vote for new commitments, but $700 million is not a lot in a foreign assistance budget that represents less than 1 percent of the budget," she said. "It gets to the broader challenge of justifying foreign assistance when you get Congress to get behind something so modest and so urgent."

The Middle East Partnership Initiative and USAID's Office for Middle East Partnerships will continue to receive funding at the same levels as last year, equaling $35 million over 6 months for both programs.

The Cable

Kerry, Rice position themselves on Benghazi attack

The two most discussed candidates to be America's next top diplomat now find themselves on opposite sides of the Libya issue, with U.N. Ambassador Susan Rice in the role of defending the administration's narrative and Sen. John Kerry (D-MA) promising tough congressional oversight while giving the State Department room to conduct its own investigation.

As the controversy over the administration's handling of the issue grows, Rice's comments on the Sept. 11 assault on the U.S. consulate in Benghazi are coming under increasing attack. Her insistence on a number of Sunday talk shows Sept. 16 that, according to the best information available at the time, the attack was an unplanned assault and the result of an anti-Islam video is facing harsh criticism from senators. Administration officials, including most recently Defense Secretary Leon Panetta, have since called it a "terrorist attack," and even Secretary of State Hillary Clinton has indicated that al Qaeda affiliated groups were involved.

"First of all, there's an FBI investigation which is ongoing and we look to that investigation to give us the definitive word as to what transpired. But putting together the best information that we have available to us today, our current assessment is what happened in Benghazi was in fact initially a spontaneous reaction to what had just transpired hours before in Cairo, almost a copycat of the demonstrations against our facility in Cairo, prompted by the video," Rice said Sept. 16 on NBC's Meet the Press.

Sens. John McCain (R-AZ), Lindsey Graham (R-SC), Kelly Ayotte (R-NH), and Ron Johnson (R-WI) accused Rice of jumping the gun and disseminating false information about the attack in a letter Wednesday by quoting Rice's comments selectively, leaving out the context where she caveated the information as being based on initial assessments.

"In the aftermath of the September 11 terrorist attack in Benghazi that resulted in the death of four Americans, including Ambassador Chris Stevens, you made several troubling statements that are inconsistent with the facts and require explanation," they wrote, referring to Rice's Meet the Press remarks as well as several other TV appearances.

They pointed out the mounting evidence that the attack was in fact pre-planned and highlighted discrepancies between Rice's statements and statements from officials including Libyan national assembly president Mohamed Yousef al-Magariaf, who has said the attack was "preplanned" and that the attackers began plotting it "a few months ago."

"We look forward to a timely response that explains how the U.S. Ambassador to the United Nations could characterize an attack on a U.S. consulate so inaccurately five days after a terrorist attack that killed four Americans," the senators wrote.

Kerry, the chairman of the Senate Foreign Relations Committee (SFRC), has taken a far more cautious position on the Benghazi attack, joining with his Senate colleagues in calling for transparency and accountability from the administration but not going so far as to criticize the Obama administration's handling of the issue outright.

Last week, Kerry objected to a bill in his committee that would have demanded the State Department report to Congress on the Benghazi attack within 30 days, put forth by Sens. Bob Corker (R-TN) and Jim DeMint (R-SC). He is deferring to the State Department's plan to set up its own Accountability Review Board, which will be led by former Deputy Secretary of State Thomas Pickering. Kerry promised his committee members that if the ARB doesn't produce good answers, he would be open to more congressional action.

"Given all of the information that should be forthcoming already, I did not think it would be productive to take up the reporting bill at this time. But I do want to thank Senators DeMint and Corker for the initiative and let them know that I share their instincts that this warrants our close attention," Kerry said at the SFRC business meeting last week.

Privately, however, Kerry has been pressing the administration for answers. He sent a letter to Deputy Secretary of State Tom Nides about Diplomatic Security on Sept. 17, The letter, which was previously undisclosed but obtained by The Cable, asks Nides to answer a host of questions on the security conditions at the Benghazi consulate and the cooperation of the governments in Egypt, Libya, and Yemen during and after the attacks.

Republicans in the Senate are not about to let up on the administration over what they perceive as serious missteps in the handling of the Libya crisis. Senate Homeland Security Committee heads Joe Lieberman (I-CT), who often joins hand with Republicans on foreign-policy issues, and Susan Collins (R-ME) have already called on Clinton to investigate the security failures at the Benghazi consulate and SFRC members Corker and Johnny Isakson (R-GA) are demanding that Clinton show Congress all the recent correspondence from the U.S. Embassy in Libya, including the cables written by Stevens.

Corker, who said last week that Clinton's briefing on the Benghazi attack was "the most useless, worthless briefing that I have attended in a long time," is set to be the ranking Republican on the SFRC, or possibly even the chairman, when the Senate returns next year. The confirmation of a new secretary of state will be high on the committee's agenda.

Already, GOP offices on Capitol Hill say they are preparing to focus on the Benghazi issue if Rice were nominated to succeed Clinton.

"Benghazi is now to Rice what Syria is to John Kerry," one senior GOP Senate aide told The Cable, alluding to Kerry's controversial past statements about Syrian leader Bashar al-Assad."Senators feel misled and given the emotions surrounding this issue. I can't imagine a Rice nomination sailing through without a floor fight. And if it's the beginning of a second Obama term, he will not want a battle over his nominee, which could weaken him right out of the gate."

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