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55–271PDF 2010

U.S. POLICIES AND PROGRAMS FOR

GLOBAL DEVELOPMENT: USAID AND THE

FISCAL YEAR 2011 BUDGET REQUEST

HEARING

BEFORE THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED ELEVENTH CONGRESS

SECOND SESSION

MARCH 3, 2010

Serial No. 111–83

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

HOWARD L. BERMAN, California, Chairman 

GARY L. ACKERMAN, New York 

ENI F.H. FALEOMAVAEGA, American 

Samoa 

DONALD M. PAYNE, New Jersey 

BRAD SHERMAN, California 

ELIOT L. ENGEL, New York 

BILL DELAHUNT, Massachusetts 

GREGORY W. MEEKS, New York 

DIANE E. WATSON, California 

RUSS CARNAHAN, Missouri 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

MICHAEL E. MCMAHON, New York 

JOHN S. TANNER, Tennessee 

GENE GREEN, Texas 

LYNN WOOLSEY, California 

SHEILA JACKSON LEE, Texas 

BARBARA LEE, California 

SHELLEY BERKLEY, Nevada 

JOSEPH CROWLEY, New York 

MIKE ROSS, Arkansas 

BRAD MILLER, North Carolina 

DAVID SCOTT, Georgia 

JIM COSTA, California 

KEITH ELLISON, Minnesota 

GABRIELLE GIFFORDS, Arizona 

RON KLEIN, Florida 

VACANT 

ILEANA ROS-LEHTINEN, Florida 

CHRISTOPHER H. SMITH, New Jersey 

DAN BURTON, Indiana 

ELTON GALLEGLY, California 

DANA ROHRABACHER, California 

DONALD A. MANZULLO, Illinois 

EDWARD R. ROYCE, California 

RON PAUL, Texas 

JEFF FLAKE, Arizona 

MIKE PENCE, Indiana 

JOE WILSON, South Carolina 

JOHN BOOZMAN, Arkansas 

J. GRESHAM BARRETT, South Carolina 

CONNIE MACK, Florida 

JEFF FORTENBERRY, Nebraska 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

BOB INGLIS, South Carolina 

GUS BILIRAKIS, Florida 

RICHARD J. KESSLER, Staff Director 

YLEEM POBLETE, Republican Staff Director 

DIANA OHLBAUM, Senior Professional Staff Member 

GENELL BROWN, Senior Staff Associate/Hearing Coordinator 

(III)

C O N T E N T S 

Page

WITNESS 

The Honorable Rajiv Shah, Administrator, United States Agency for International Development .......................................................................................... 4

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

The Honorable Rajiv Shah: Prepared statement .................................................. 8

The Honorable Keith Ellison, a Representative in Congress from the State 

of Minnesota: Associated Press article by Katharine Houreld dated February 17, 2010 ...................................................................................................... 34

APPENDIX 

Hearing notice .......................................................................................................... 44

Hearing minutes ...................................................................................................... 45

The Honorable Howard L. Berman, a Representative in Congress from the 

State of California, and Chairman, Committee on Foreign Affairs: Prepared 

statement .............................................................................................................. 47

The Honorable Diane E. Watson, a Representative in Congress from the 

State of California: Prepared statement ............................................................ 49

Written responses from the Honorable Keith Ellison to questions submitted 

for the record by: 

The Honorable Eliot L. Engel, a Representative in Congress from the State 

of New York ...................................................................................................... 50

The Honorable Ileana Ros-Lehtinen, a Representative in Congress from 

the State of Florida .......................................................................................... 61

The Honorable Barbara Lee, a Representative in Congress from the State 

of California ...................................................................................................... 165

The Honorable Gus Bilirakis, a Representative in Congress from the State 

of Florida ........................................................................................................... 179

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U.S. POLICIES AND PROGRAMS FOR GLOBAL 

DEVELOPMENT: USAID AND THE FISCAL 

YEAR 2011 BUDGET REQUEST 

WEDNESDAY, MARCH 3, 2010

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON FOREIGN AFFAIRS, 

Washington, DC. 

The committee met, pursuant to notice, at 9 o’clock a.m. in room 

2172, Rayburn House Office Building, Hon. Howard L. Berman 

(chairman of the committee) presiding. 

Chairman BERMAN. The committee will come to order. We have 

to adjourn today’s hearing shortly before 11 o’clock a.m. so members can attend the memorial service for our late colleague, John 

Murtha. 

Given the relatively short time we have to spend with our distinguished witness, I will limit opening statements to myself and the 

ranking member. All other members may submit written statements for the record. 

Dr. Shah, I am very pleased to welcome you for your first formal 

appearance before this committee and your first time testifying before Congress as USAID administrator. 

Less than 2 weeks after being sworn in, you were made the 

Obama administration’s point person in responding to the almost 

unimaginable tragedy in Haiti. Dealing with a crisis of that magnitude would be a tall order no matter how long you had served 

as administrator, and by all accounts you stepped up to the task 

with great aptitude and aplomb. 

Prior to your confirmation, USAID had been without a permanent administrator for an extended period, so we particularly appreciate the leadership you have demonstrated and the experience 

and dynamism you bring to the job. 

Our focus today is on the President’s Fiscal Year 2011 budget request, and specifically the policies and programs for development 

that USAID is responsible for designing and implementing. 

Secretary Clinton has rightfully identified diplomacy and development as two key pillars of our national security, along with defense. We make it a priority to reduce poverty and alleviate human 

suffering around the world because it is the morally right thing to 

do and because it reflects the compassion and generosity of the 

American people. But foreign assistance programs also serve our 

economic and national security interests. 

Poor and unstable countries make unreliable trading partners 

and offer weak markets for U.S. goods and services. Conflict, lawVerDate 0ct 09 2002 17:40 May 14, 2010 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 F:\WORK\FULL\030310\55271 HFA PsN: SHIRL
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lessness and extremism that threaten U.S. interests find fertile 

ground in the places where basic human needs are not being met 

and fundamental human rights are not respected. Done right, development assistance is a sound investment in a better, safer 

world. 

One of my legislative priorities is to reform our foreign assistance 

laws and programs to ensure that aid reaches those who need it 

most, and that it is delivered with maximum effectiveness and efficiency. Our development assistance should aim not only to improve 

the lives of poor people, but to build the human capacity and the 

economic and political institutions that will sustain these gains. 

I look forward to working with you as we write legislation to replace the outdated and cumbersome legal structure that currently 

exists with one designated to meet the needs of the 21st century. 

The administration is now in the midst of two reviews that will 

have some bearing on this process. The Quadrennial Diplomacy 

and Development Review, or QDDR, seeks to define the capabilities 

that are needed and to match resources with priorities. The Presidential Study Directive known as PSD–7 will, we hope, produce a 

national strategy for global development that establishes clear and 

specific objectives for United States policies and programs, consistent with the Millennium Development Goals. 

We should strive to achieve those goals not only in countries 

where the risk of violent extremism is most pronounced, but everywhere that children go hungry, women die in childbirth for lack of 

skilled assistance, and communities are ravaged by a preventable 

disease. 

I am particularly gratified that the President’s budget places an 

emphasis on global health, food security and climate change. These 

are areas where the international community faces significant challenges, and where we know how to make a real difference. They 

build on one of the great foreign policy legacies of the previous administration, the President’s Emergency Plan for AIDS Relief, or 

PEPFAR. 

To ensure that our assistance is as effective as possible, we must 

elevate and strengthen USAID. I applaud Secretary Clinton’s call 

to ‘‘rebuild USAID into the world’s premiere development agency.’’ 

We also must make good on President Bush’s pledge to double the 

size of the USAID Foreign Service, a goal that President Obama 

has also endorsed. 

To put the budget numbers in perspective, the entire International Affairs budget accounts for just over 1 percent of Federal 

spending. And only about a third of that 1 percent is allocated to 

development and humanitarian programs. 

One overarching goal of our foreign assistance is to reduce the 

need for putting American soldiers in harm’s way. About 18 percent of the entire International Affairs budget—and about 60 percent of the growth since last year—is for the front-line states of 

Iraq, Afghanistan and Pakistan. By building schools, training police and increasing agricultural production, we help lay the foundations for a more stable future in these volatile nations. It is an investment well worth making, considering the savings in long-term 

costs in American blood and treasure. 

3

With this in mind, the increases for Fiscal Year 2011 are quite 

modest and, I think, extremely well-justified. 

Dr. Shah, we appreciate having you here this morning. We look 

forward to your testimony. But first I would like to turn to the 

ranking member, Ileana Ros-Lehtinen, for any opening remarks 

that she might want to make. 

Ms. ROS-LEHTINEN. Thank you. As always, Mr. Chairman, thank 

you for the opportunity. And Dr. Shah, I join in welcoming you to 

our Foreign Affairs Committee. With the recent tragedy in Haiti 

and the intensive, rapid efforts to help the people of that devastated country, you have had a bracing introduction to your current position. And as I had said to you in the side room, you represented our humanitarian country so well, and I commend you for 

an exemplary USAID mission in Haiti. You hit the ground running. 

We wish you well in all of your endeavors on behalf of our nation, 

and those whom it seeks to help throughout the world. 

I am, however, disappointed that the congressional Budget Justification for your Agency is not yet available. That places us at a 

disadvantage today in discussing the Fiscal Year 2011 budget request for USAID, because we lack that information. 

Necessity is the mother of invention. The past year has seen a 

dramatic deterioration in our nation’s economic position. Should 

the President’s proposed budget for Fiscal Year 2011 be adopted 

without any changes, the debt created in the next year alone will 

equal an additional $4,000.00 owed by every man, woman, and 

child in the United States. This would be on top of the $40,000 that 

each American already effectively owes, through the public debt. 

We are now borrowing at a rate of about $4 billion a day to keep 

our Government in operation. This is not the best position for our 

country to be in. 

In light of this situation, I recommended to Secretary Clinton 

last week that, although our aid programs are not a major part of 

the overall budget, we need to find places where we can slow down 

or freeze spending. We have this opportunity to foster innovation, 

and I believe that the seeds for this innovation are already contained in some of USAID’s programs. They just need to be expanded to allow us to move away from more costly assistance programs that work through wasteful, and often corrupt, bureaucracies abroad, and that so often create dependency and breed stagnation among recipient countries. 

Instead of continuing with such tremendous reliance on USAID’s 

traditional Development Assistance account, for example, we might 

instead consider moving quickly to expand our Development Credit 

Assistance program, which, at far less cost, leverages tremendous 

private funding in pursuit of our development goals. In line with 

that, we might also consider expanding USAID’s Global Development Alliances program, an approach that is, once again, built on 

leveraging private funds and pursuing development goals without 

creating aid dependency in other countries. 

In short, we have to do more with less. There are additional innovations out there, many of them based on technological advances 

of the past two decades, which USAID is either already experimenting with or should consider. I will cite some examples. 

4

Improvements in marketing by small-scale farmers and shop 

owners in impoverished countries by means of cell phone alerts. 

The development also of affordable, small-scale clean-energy power 

generators that can be run off the electrical grid in remote areas. 

Also, small-scale vouchers for farmers, allowing them to break free 

from the control by huge bureaucratic and often corrupt ministries 

in obtaining seed and other farm inputs. 

USAID is working in many of these areas, but we need to think 

of how we can intensify the focus on such small-scale programs, 

which can unleash individuals’ creativity, rather than continuing to 

interact with unaccountable bureaucratic government agencies 

abroad. 

We should also consider ways to multiply the impact of such 

small-scale programs wherever possible, by implementing the approach used in our micro-finance and micro-credit programs, where 

even the poorest beneficiaries are expected to repay some of their 

assistance to cooperative groups that can then, in turn, provide 

such assistance to others. Small businesses and individual opportunities are what helped America grow into the prosperous country 

that we are, long before there was a theory of development. It is 

time to revisit our longstanding views and theories on how to help 

the impoverished around the world become self-sustaining and 

prosperous. 

I hope that the challenges of addressing our fiscal deterioration 

here at home will lead us to truly explore ways to be more efficient 

and accomplish our goals at less cost, but with more benefit for 

those who deserve our help. 

I thank you again, Dr. Shah, for what you have done in Haiti. 

I know that you are already standing up a new program in Chile, 

in far different circumstances. I congratulate your entire team at 

USAID. 

Thank you, Mr. Chairman. 

Chairman BERMAN. Thank you, Ms. Ros-Lehtinen. And now I am 

happy to introduce Dr. Rajiv Shah. He is the 16th administrator 

of the United States Agency for International Development. 

Prior to his confirmation as administrator, he served for about 6 

months as under secretary of agriculture for Research, Education, 

and Economics, and chief scientist. 

A medical doctor and health economist by training, Dr. Shah previously spent 7 years with the Gates Foundation holding leadership 

positions in its agricultural development and global health programs. 

Dr. Shah, your entire statement will be made a part of the 

record, and we look forward to hearing your testimony. 

STATEMENT OF THE HONORABLE RAJIV SHAH, ADMINISTRATOR, UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT 

Dr. SHAH. Thank you. Chairman Berman, Ranking Member RosLehtinen, members of the committee, I am honored to join you here 

today in support of the President’s Fiscal Year 2011 Foreign Operations Budget Request. 

In the interest of time, please allow me to summarize the key 

points of my testimony, and submit the full text for the record. 

5

As you know, just days after my swearing-in, the people of Haiti 

were struck by a tragedy of almost unimaginable proportions. This 

past weekend, Chile suffered a devastating earthquake, as well. 

Our thoughts and prayers, as are yours, are with the people of 

Chile and Haiti, as we provide humanitarian relief and assistance. 

In the aftermath of the earthquake in Haiti, President Obama 

designated me to lead our overall Federal response, and charged 

our Government with mounting a swift, aggressive, and coordinated effort. In that capacity USAID coordinated a multi-agency effort, with the Departments of State, Defense, Homeland Security, 

Health and Human Services, Agriculture, and many other Federal 

partners. 

With these partners we launched the largest and most successful 

international urban search-and-rescue effort ever; created a robust 

urban food distribution system that reached more than 3 million 

individuals with critical food supplies; greatly increased a nation’s 

infrastructure, especially at the ports and the airport; and coordinated medical assistance support, including direct treatment for 

more than 30,000 patients, and performed hundreds of surgeries, 

saving lives and limbs. 

Haiti faces a long and steep road to recovery. And as the operations transition from rescue to recovery, we will continue to stand 

by the people of Haiti, and appreciate the support of this committee 

and the Congress in doing so. 

At the same time, we will not lose sight of the other priorities, 

including the important work that USAID does to help other countries achieve their development goals, and the critical need to 

strengthen our capacity and accountability in pursuit of this mission. The investments we make today are a bulwark against current and future threats, both seen and unseen, and a down payment for future peace and prosperity around the world. 

As President Obama said in Oslo last December, security does 

not exist when people do not have access to enough food or clean 

water, or the medicine and shelter they need to survive. 

Secretary Clinton strongly shares this view, and has asked us to 

elevate development to stand with diplomacy and defense as part 

of our nation’s foreign policy. 

Together with other government agencies, USAID is examining 

our resources and capabilities to determine how best to achieve 

these development objectives. We are doing so through the Presidential Study Directive on U.S. Development Policy, the Quadrennial Diplomacy and Development Review, and through consultations with congressional committees that are pursuing foreign assistance reform. 

The Fiscal Year 2011 budget request will support development 

priorities that contribute directly to our national security. Specifically, our request is focused on three priority areas: Securing critical front-line states, meeting urgent global challenges, and enhancing USAID effectiveness and accountability. 

Allow me to summarize each briefly. First, in critical front-line 

states, we propose spending $7.7 billion in State and USAID assistance in support of development efforts in Afghanistan, Pakistan, 

and Iraq. We have made some progress in each of these countries, 

but we realize that significant challenges remain. 

6

Over the past several years our focus in Afghanistan has been 

achieving greater stability and security. We are beginning to see 

major improvements in health care, education, and agriculture, as 

well as, in some cases, the foundation of a more representative and 

democratic government. 

The administration’s funding request is part of the President’s 

Afghanistan strategy, and designed to encourage stability and opportunity in that nation. 

In Pakistan, our request supports ongoing efforts to combat extremism, promote economic opportunity, strengthen democratic institutions, and build a long-term relationship with the Pakistani 

people. Here, too, our programs are helping to achieve significant 

improvements in education and health. 

The funding increase in Fiscal Year 2011 for Pakistan will help 

USAID reach approximately 60,000 more children with nutrition 

programs, increased enrollment in both primary and secondary 

schools by over 1 million learners, and support 500,000 rural 

households to improve agricultural production. 

In Iraq we have transitioned to a new phase in our civilian assistance relationship, shifting away from reconstruction toward the 

provision of assistance to bolster local capacity in line with Iraqi 

priorities. USAID is promoting economic development, strengthening the agriculture sector, which is the largest employer of Iraqis 

after the Government of Iraq, and increasing the capacity of local 

and national government to provide essential services. 

Our second budget priority is focused on meeting urgent global challenges. $14.6 billion in State and USAID assistance will support local and global solutions to core transnational problems, including global health, extreme poverty, natural and manmade disasters, and threats of further instability from climate change and 

rapid population growth. In global health, we are requesting $8.5 billion in State and 

USAID assistance. Our request supports the President’s Global 

Health Initiative. With this additional funding, we will build on our 

strong record of success in HIV/AIDS treatment, tuberculosis, and 

malaria control, and seek to achieve improved results in areas 

where progress has lagged, such as obstetric care, newborn care, 

and basic nutrition. 

In food security we are proposing to invest $1.2 billion for State 

and USAID food security and agriculture programs, in addition to 

$200 million set aside for nutrition. With these additional funds we 

will work in countries in Africa, Central America, and Asia to combat poverty and hunger. 

In climate change, we propose to invest $646 million for State 

and USAID programs, part of the administration’s overall $1.4 billion request to support climate change assistance. USAID will support the implementation of sustainable landscape investments, as 

well as developing low-carbon-development strategies for critical 

countries, market-based approaches to sustainable energy sector 

reform, and capacity building and technology development to enhance adaptation and resilience strategies. 

In humanitarian assistance, USAID and State propose to invest 

$4.2 billion. This funding allows us to assist internally displaced 

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ters worldwide, such as the tragic earthquakes in Haiti and Chile. 

With these combined investments, we will save lives and help 

make people less vulnerable to both poverty and the threat of instability that extreme poverty breeds. 

Our third major budget priority focuses on enhancing USAID’s 

effectiveness and accountability by investing $1.7 billion in the ongoing rebuilding effort for USAID’s personnel and infrastructure. 

All of the priorities I have outlined require strong capacities in 

evaluation, planning, strategic resource management, and research, 

to ensure we are incorporating the best practices, innovations, and 

technologies from the field. 

We also must be able to recruit, hire, and retain best-in-class development professionals. By reducing our reliance on contractors to 

design and evaluate programs, we will not only save taxpayer dollars, but also enable greater oversight and more effective program 

implementation. Through these critical investments we can achieve 

the development goals we have set around the world, and restore 

USAID’s standing as the world’s premiere development agency. 

I know this is a time of great economic strain for so many Americans. For every dollar we invest, we must show results. That is 

why this budget supports programs vital to our national security 

and our ability to account for outcomes. 

The United States must be able to exercise global leadership to 

help countries, as they develop more stable and sustainable foundations for security, stability, and well-being. This requires the effective use of all instruments of our national security, including development. And this requires a relentless focus on results and accountability, a focus we embrace with enthusiasm. 

Thank you very much, and I look forward to your questions, your 

guidance, and your ongoing consultation. 

[The prepared statement of Mr. Shah follows:]

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Chairman BERMAN. Well, thank you very much. We appreciate 

your vision, and the specifics that fill it out. And I will give myself 

5 minutes to begin the questioning. 

Dr. Shah, could you give us an update on the status of the Quadrennial Diplomacy and Development Review, and the Presidential 

Study Directive on Global Development Policy? And more specifically, when can we receive the findings, and will they be made public? 

Dr. SHAH. Yes, thank you, Mr. Chairman, for those questions. 

The QDDR has completed now its first phase of work, which was 

structured around a broad set of exploratory conversations and 

brainstorming related to five core working-group topic areas relating to how the United States projects its power and its smart 

power and its diplomatic and development capacities around the 

world. 

As we transition, we are in the process of transitioning to a series of more operationally oriented task forces that will be addressing specific topics, like how we improve our ability to do policy 

planning, how we develop real systems for accountability and budgeting, how we help our country’s missions and our country’s chiefs 

of missions develop long-term investment strategies for development and diplomacy, and have the flexibility to partner more effectively with the private sector with sources of innovation and with 

country governments themselves. 

The results of those more specific operational efforts should be 

available in the April/May timeframe. We, at this point, do hope to 

have deep and ongoing conversations both about the content of the 

QDDR, as well as learning from the committees and the Congress 

around a range of views on some of these core issues. And that is 

an ongoing process, but one that has shifted from a larger strategic 

conversation to a more focused set of operational discussions. 

The Presidential Study Directive is similarly making the same 

transition, after having completed a series of phases of work that 

brought together 16 to 18 different agencies throughout the Federal 

Government to discuss ideas and concepts in a more open space, 

related to the future of development. That is now transitioning into 

also a more operational focus, to come up with specific constructs 

that will define the development strategy of this administration 

going forward. 

These two processes come together in a number of different ways, 

not least of which are deputy’s committees that we participate in; 

but also just the key individuals that are part of both of these processes are often the same individuals. 

Chairman BERMAN. And the PSD, when do you think that process—you mentioned April? 

Dr. SHAH. Yes. 

Chairman BERMAN. An initial idea of April for the QDDR. What 

about the PSD? 

Dr. SHAH. Well, I should clarify, I don’t think the QDDR will be 

complete in April, but I think we will have enough specifics to 

begin a serious consultation on a set of ideas in that timeframe. 

On the PSD, I would expect the same thing, although I shouldn’t 

speak on behalf of the National Security Council. I think they can 

16

identify a more specific timeline, and we could come back to you 

with a more specific answer on it. 

Chairman BERMAN. I would appreciate that. In order to fund 

Haiti’s relief effort, you had to borrow money from other humanitarian programs across the globe until the supplemental funding 

arrives. Everyone understands the overwhelming needs in Haiti, 

but the fact is, these transfers have created some hardships and 

delays on the ground in other countries, such as Sudan and Congo. 

What is being done to ensure that other humanitarian emergencies aren’t being neglected in order to address the tragedy in 

Haiti? 

Dr. SHAH. Well, I appreciate that question, sir. And I believe the 

United States Government has already committed more than $600 

million to the effort in Haiti. And as you point out, that, a large 

percentage of that, has come from the IDA account that provides 

the flexible and rapid funding. We will seek, in a supplemental, to 

reconstitute the IDA account as fully as possible in this context. 

We have been in close contact with our implementing partners 

in other complex crises around the world, and have asked them not 

to delay or slow down program implementation, working under the 

assumption that those additional resources will arrive prior to the 

June timeframe, which is when we, you know, would have to start 

making those trade-offs that we hope not to make. 

So I am aware that a number of partners felt they might have 

to do that. We have tried to be in touch with everyone who has 

reached out to us to indicate that they should not slow down programs in other areas; that we expect the supplemental to reconstitute IDA in a manner that——

Chairman BERMAN. So you are really saying the assumption of 

my question is wrong. There has not been deprivation in other programs as a result of the transfer. 

Dr. SHAH. That is correct, sir. I believe there have been, I know 

that partners have reached out to us, asking if they should. And 

when we did, we tried to correct that misperception right away. 

Chairman BERMAN. And my time has expired. The ranking member is recognized for 5 minutes. 

Ms. ROS-LEHTINEN. Thank you, Mr. Chairman. I want to touch 

on Cuba, Haiti, the West Bank, and Gaza, all in 5 minutes. No 

problem, right, Dr. Shah? 

I am concerned that, with the arrest and the imprisonment of 

U.S. citizen Alan Gross, that USAID programs in Cuba may have 

come to a standstill. If we could get a commitment from you, Dr. 

Shah, that USAID is going to continue to carry out U.S. democracy 

programs in Cuba, I would appreciate that. 

On Haiti, following up on the chairman’s questions, how should 

the cost of recovery response and long-term development efforts in 

Haiti be shared among donor countries? And what portion of the 

overall aid efforts for Haiti over the coming years should the 

United States be expected to provide; 10 percent, 20 percent, 30 

percent, whatever figures you think. 

Lastly, on the West Bank and Gaza, the administration has requested another over $400 million in Economic Support Funds for 

the West Bank and Gaza, but, as we have seen, there has been a 

lot of stealing of those funds; it has not been managed well. 

17

What kind of vetting do we have in place to ensure that the 

funding does not benefit violent extremists or corrupt officials, and 

instead reaches its intended targets? What kind of metrics are we 

using to ensure that we can actually accomplish what we seek to 

do with the funding? 

Thank you, sir. 

Dr. SHAH. Thank you. I appreciate those questions. On Cuba in 

particular, I think we can strongly affirm our commitment to execute our programs and our priorities. We have taken a number of 

steps working with the State Department to try to address the 

needs of Mr. Gross. I have been in direct contact with DAI, the 

partner for whom he was contracted to work with. And we have 

worked directly with a range of our other partners to ensure that 

they, given the challenging travel situation, that they come up with 

alternative solutions to execute and implement these programs. 

And we are giving them the flexibility to do that. So we are fully 

committed to seeing through the program there. 

On Haiti, I appreciate your points and your earlier comments 

there, as well. We have been approximately half of the overall early 

relief effort. A large part of that is the Department of Defense, the 

costs related to Department of Defense assets, including the Marines, the Comfort Hospital Ship, the effort to rebuild the port and 

the airport, those were mission-critical early activities that were required for other assistance to come in. 

As we transition through recovery reconstruction, we expect that 

percentage will go down significantly. And we are working with a 

range of major bilateral partners, but also the World Bank, as part 

of the post-disaster needs assessment, to make sure there is a 

strong plan going forward that is unveiled at the donors’ conference 

later in March, this month. And that U.S. assistance is targeted, 

and a far more modest percentage of the overall needs. It will be 

a small percentage. But our leadership will be critical, and our 

technical support and our deep engagement in this process will be 

continued and unwavering. 

On West Bank and Gaza, I appreciate the question, as well. As 

you know, we have systems for both tracking partners and vetting 

partners. The partner-vetting system there involves the specific 

identification of names of partners. It involves our database tracking systems, and we vet that very, very carefully. That system has 

been in place for more than 2 years. 

On the cash tracking, we also have a very specific system that 

has been in place for more than 4 years, where we are supporting 

and we authorize specific disbursements from the Palestinian Authority. The resources are transferred quite closely, from a bank in 

Israel to a special Treasury account in the Palestinian banking system. And then all flows out of that are monitored on a case-by-case 

basis. 

So there is a very strong system in place for tracking cash flows 

in that environment, as well. And our budget request going forward 

is to really focus on doing specific work that will achieve real outcomes in infrastructure and in health, and in humanitarian support in Gaza. And I am happy to describe that some of the things 

we have done have been successful, building 60 kilometers of road 

in the West Bank, funding seven schools that are operational and 

18

effective, and promoting a broadly based health system in that region that is reaching many, many more people in need. 

So we will continue to track those outcomes very closely, but we 

have special systems for tracking how we work with partners, and 

how we track the flow of cash. 

Ms. ROS-LEHTINEN. Thank you so much. And the emphasis 

should always be to make sure that it is a transparent, accountable 

system of aid that is not corrupted by officials in the West Bank 

and Gaza. 

Thank you, Dr. Shah. Thank you, Mr. Chairman. 

Chairman BERMAN. I yield 5 minutes to the gentleman from New 

Jersey, the chairman of the African Global Health Subcommittee, 

Mr. Payne. 

Mr. PAYNE. Thank you, Dr. Shah, and let me also commend you 

for the outstanding job that you have done in Haiti. Also, I wish 

we didn’t have a debt, but we do have to remember we had a balanced budget when President Clinton left. However, the war in 

Iraq, which was unnecessary, and big tax cuts put us in the position we are in today, unfortunately. 

Let me just say about the Global Fund. I see that you have cut 

$50 million from the Global Fund, and I wonder if you would look 

at that. Because, as you know, the U.N. formula is a one-third 

U.S., that means $150 million will be cut overall when the other 

nations participate. 

Secondly, on the neglected tropical diseases. Although you are 

dealing with them, some of them, the most neglected, such as fatal 

vascular mineosis, sleeping sickness, Charge’s Disease, and some of 

these other disfiguring, buruli ulcers, are not covered. And I wonder if they could be included in that. 

Just real quickly, on three governance groups, Somalia, the transitional Federal Government. I wonder, will there be a significant 

increase in development aid, because we have to support this government or we are going to be, in my opinion, in very serious problems. If they fall, all of these—Africa, as you know, Somaliland, 

Putland, and Somalia, in my opinion, will go. 

Secondly, are we concentrating enough on South Sudan? If, in 

2011, they decide to secede, how will we support the new government with additional funds? 

And finally, Liberia needs to have some consideration. Where we 

have strong institutions, we see elections work, like South Africa 

and other places. Where we don’t, they fail. So if you could look at 

Liberia, the historical relationship between the United States and 

Liberia is important. 

And finally, I would like to know how you are making out with 

AFRICOM and the coordination with that. I will just stop so that 

you can answer the questions. Thank you. 

Dr. SHAH. Thank you, Mr. Chairman. We have, on the global 

front in particular, and that is in the context of the larger Global 

Health Initiative, we are committed to significant financial increases against Global Health. And even more than that, using 

those resources in a way that will be more effective against those 

lagging indicators within the MDGs, like maternal mortality and 

newborn and obstetric care. 

19

We are working with the Global Fund, with the Global Lines for 

Vaccines and Immunization and other vertical programs, to try to 

accelerate the partnerships between them, and get more value out 

of the overall investment. 

The overall administration request on the Global Fund is $1 billion, because it, of course, includes the Treasury component. And 

we will be very committed to helping the Global Fund succeed. 

On neglected tropical diseases, I will take your comments as advisement, and look specifically into those cases. That is a unique 

area where I do believe we can have, and we have been in discussions with private partners to accelerate public-private partnerships and meet the overall needs, as they have been delineated by 

the World Health Organization and others. And that is very much 

a priority of the Global Health Initiative. 

On Somalia, we will, in terms of increases in development assistance, as you know, most of our assistance is humanitarian at this 

point. It is flowing through the north. We continue to be in close 

conversation with the World Food Program to explore what can be 

done, and when it can be done in other parts of Somalia. And we 

look to use our development assistance in a strategic manner. I will 

follow up more specifically on what we could do to be more expansive in that context. 

With Southern Sudan, we have $95 million for the referendum 

and for support for the referendum, and we are doing a series of 

activities with respect to capacity building and serving the people 

of Southern Sudan. 

I will note that our mission is in that region there. And unlike 

other partners, even multi-lateral partners that are trying to serve 

that region from farther away, we feel we are very well-positioned 

to play a critical role should the needs arise, as you have identified. 

And so we are doing contingency planning around that, and also 

identifying what kind of budget flexibility we would have, and what 

the needs would be. 

But we think we have an important role in leading that effort. 

We think we would have an important role in bringing other donors and multi-lateral institutions to that mission, should that be 

the outcome of the early 2011 referendum. And I will take your 

comments on Liberia as guidance. 

And on AFRICOM, we continue to be in discussion with them, 

and do hope to have a strongly coordinated operational effort in Africa with them. I personally visited them this summer, and hope 

to continue that conversation. 

Chairman BERMAN. The time of the gentleman has expired. The 

gentleman from Texas, Mr. Poe, is recognized for 5 minutes. 

Mr. POE. Thank you, Mr. Chairman. Dr. Shah, thank you for 

being here. I am over here, far right to you. 

First of all, I want to commend the workers in the field in 

USAID. I have traveled, you know, like everybody else on this committee, all over. And they are the greatest ambassadors for the 

United States and freedom that we have, are those people in the 

field. 

And I know that USAID is developing all kinds of things. Most 

recently, the farmers down there at Texas A&M invented some 

kind of soybean that now yields nine times what they used to yield, 

20

for Afghanistan, so that the farmers in Afghanistan don’t have to 

raise poppies. They can raise soybeans that were invented at Texas 

A&M. I mean, that is all good things, those are all good. 

I am concerned about, though, being good stewards of money. 

Last week we had before us the Special Inspector General for Iraq 

Reconstruction, Stuart Bowen. And he said that in reconstruction 

of Iraq there was, and there is, $4 billion unaccounted for. 

And I asked him which, of all the agencies that are in Iraq from 

the United States, has the, I guess the worst record of accountability. And he said the State Department. Of course, the example 

he used was the $2.5 billion that went to Dimecorp for training police officers, and there is no record. We have no records about 

where that $2.5 billion went. And so I am concerned about the 

unaccountability of money we send. 

And I also asked him about well, could some of that money have 

turned up in the hands of our enemies, like al-Qaeda? And he mentioned that there were 14,000 Glock weapons that disappeared 

from our possession to somewhere else. That troubles me. We have 

our men and women in uniform overseas trying to protect us, and 

guns that we ship over there end up in their hands because our 

Federal agencies aren’t good stewards of, of the money. 

So you want an increase in the budget. We have 15 million 

Americans unemployed. It seems like, to me, when some country 

is in trouble, of course they call 1–800–USAID to come over and 

help them out, you know. That is what we kind of do in this country. The government and the people of this country are the most 

giving of any nation in history. 

But I would like for you to specifically address this problem of 

accountability. And how do we know that this money is going to 

be accounted for; that thieves aren’t going to steal it, that crooked 

contractors aren’t going to steal it, and the bad guys aren’t going 

to end up with some of the aid that we send to foreign countries. 

Similar to some of the questions that the ranking member addressed in other parts of the world. 

So how about that, Dr. Shah? 

Dr. SHAH. Thank you, sir. I want to thank you for your comments about our staff, and also acknowledge that our Foreign Service nationals in that context do make us awfully proud. 

I also want to address your comment about Texas A&M. We are 

proposing in this budget an increase in our agricultural research 

and development as it relates to meeting the needs in some of 

these priority countries in food security. 

With respect to Iraq reconstruction, the contract you referred to, 

I would just point out that for USAID, we have a shifting strategy 

where we are moving toward supporting the elections that are upcoming, and providing real support to the government and the 

health system, and other, meeting basic human needs and the 

needs of IDP populations. 

We are also more aggressively pursuing matching fund requirements to make sure that our resources are being matched by the 

Government of Iraq. And we have strong financial accountability 

and procurement systems in place that are tracked very closely in 

that context. 

In general, your point——

21

Mr. POE. Excuse me, Dr. Shah. Are these accountability, are 

these accounting procedures new? Or are they the same ones 

where——

Dr. SHAH. No, many of them are new over the course of the last 

year. Some of them have all been, are based on some learning. 

There are four basic strategies we use to track and ensure accountability. I agree they could be more transparent, and it is one 

of my priorities to make them more effective and transparent. 

One is selectivity. We have rigorous systems for making sure we 

only work with those partners, especially in Afghanistan and Pakistan, where we can track the resources and have confidence in effectiveness of spending. 

A second is around capacity building, particularly in financial 

management and procurement systems, both reform and tracking. 

A third is on monitoring, and a fourth is on auditing, which we 

do in a multiple manner system in those places. 

Mr. POE. Thank you, Dr. Shah. 

Chairman BERMAN. The time of the gentleman has expired. The 

gentleman from New York, Mr. Meeks, is recognized for 5 minutes. 

Mr. MEEKS. Thank you, Mr. Chairman. Good morning, Dr. Shah. 

It is great having you here, and I thank you for, commend you for 

all of your efforts, especially in helping Haiti with the aftermath 

of the devastating earthquake. 

You talked about how complex it is in dealing with Haiti. I would 

like first to ask you the question, can you describe for us the international aspect of the effort to help Haiti? Specifically what I am 

interested in is the coordination of efforts, the coordination of 

funds, who is leading that effort, where do we go from here, and 

what role can the Haitian Government play? And how do we support that government until it has the capacity to take on more or 

most of the responsibility? 

I know that there are a number of international communities 

that are calling for a Haiti Marshall Plan. And I, myself, have put 

in a resolution calling for a Haiti Marshall Plan. So I would like 

to know what your thoughts are on whether or not we need to do 

that clarion call, and whether Haiti needs a Marshall Plan. 

Then, I just want to ask also, in the short time that we have, 

about Afro-Latinos in the Western Hemisphere. You know that the 

Obama administration has finalized the signing of the U.S.-Colombia Joint Action Plan on Racial and Ethnic Equality. And we have 

one on Brazil, of which I have asked also to get the report on that, 

so that we can continue to follow that. I know we are still making 

progress. But over the years, I have requested appropriators that, 

from the USAID funds be specifically directed toward helping 

marginalized communities in Latin America. And more often than 

not, those disproportionately means they are Afro-Latinos and indigenous populations. 

So I would like to know, can you tell me about your plans to address the plight of African Latinos and indigenous populations? 

And have you prioritized the plans from the budget perspective? 

And finally, and real briefly, I am also concerned about trade capacity and trade capacity dollars. So can you tell me if there are 

any plans to more comprehensively coordinate trade capacity dolVerDate 0ct 09 2002 17:40 May 14, 2010 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 F:\WORK\FULL\030310\55271 HFA PsN: SHIRL
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lars across the various departments and agencies that have these 

funds? 

I have proposed, for example, that we create an Office for Trade 

Capacity for the nation. I would like to know your thoughts on this 

kind of function. 

Dr. SHAH. Thank you for those comments and questions. I will 

start with Haiti. 

The international aspect is being led by the Government of Haiti, 

working with an internationally recognized system of U.N. clusters 

that are established sector by sector. We play a key role in each 

of the clusters, and directly with the Government of Haiti. 

We also, in some cases, like rubble removal for the establishment 

of safe places in advancing, where the floods are coming in, or in 

food distribution or water distribution, at times when frankly we 

felt the clusters needed more support, we have stepped in and offered more capacity and more directed leadership from our military-civilian partnership in Haiti. So that is how it is being coordinated on an international aspect. 

In terms of the plan forward, the Haitian Government has had 

a plan, most recently unveiled last spring, and also revised and updated for last fall, which was based on a decentralization of the 

population outside of Port-Au-Prince, and creating vibrant economic opportunities and centers of economic activity outside of 

Port-Au-Prince. We expect them to unveil that plan in a more updated and specific form at the upcoming donors’ conference, and believe that does constitute the groundwork for a very strong reconstruction effort that will hopefully build back a more vibrant and 

more effective economy, governance system, and ability to meet 

human needs in Port-Au-Prince. And, perhaps more importantly, to 

the majority of the population outside of Port-Au-Prince. 

In terms of your comments about Afro-Latinos in the Western 

Hemisphere, it is absolutely true and completely recognized by our 

agency that those marginalized communities are disproportionately 

suffering on health and human indicators of welfare and well being 

throughout the hemisphere. And that is a clear and statistically 

straightforward point. 

I will come back to you more specifically on how our budget addresses that. But in our efforts to address food security, global 

health, and meeting basic human needs, we are disproportionately 

targeting those marginalized populations. And how that plays out 

in terms of budget numbers, I will come back to you more specifically. 

And finally, on trade capacity building and coordination, I do believe that we need more effective coordination in that context. We 

have been in a conversation as part of the Presidential Study Directive, and in efforts like our Food Security Initiative, to explore 

how we can improve the integration of our trade policy, our trade 

capacity investments, and our investments in agriculture and highvalue agriculture, to get more bang per buck in our development 

spending. 

Thank you. 

Chairman BERMAN. The time of the gentleman has expired, and 

the gentleman from New Jersey, Mr. Smith, is recognized for 5 

minutes. 

23

Mr. SMITH. Thank you, Mr. Chairman. Dr. Shah, thank you for 

your testimony. 

About 12 years ago, Dr. Shah, I initiated an effort on the whole 

issue of autism, at a time when very few people were paying attention to it. And it led to the creation of the Centers of Excellence. 

As a matter of fact, I wrote the provisions for the Centers of Disease Control. 

We quickly found that we may have an epidemic where about 

one out of every 100 of our children have autism or part of the autism spectrum. 

I have since been focusing on the international elements of autism. And to my not shock, but certainly to my, and I think many 

other people’s, dismay, have realized that we have a global epidemic of autism. 

I am working with a number of NGOs in Nigeria, in Kenya, Indonesia, Poland, and in Ireland, in trying to combat autism. And 

what all of these organizations have is a deficiency in funding. Lots 

of thought, a lot of good expertise, but lack of funding. 

I have introduced legislation, H.R. 1878, about a year ago, that 

would provide a small grants program, and also a teach-the-teachers program. And I am asking you if you would take a good, long, 

hard look at these NGOs, as I am sure you have the authority, absent the legislation, to assist these NGOs. 

I will give you one on defeating autism in Nigeria, as I know 

some of the people involved with an NGO there. They suggest that 

there may be as many as 1 million Nigerians who have autism. So 

I would ask you to take a good, hard look at this, and provide some 

assistance there. 

Secondly, on your three priority areas, you talk about instability 

from rapid population growth. I would respectfully request that you 

take a second look at the issue of depopulation. In places all over 

Europe, Russia, the U.N. estimates that by the year 2050, there 

will be 25 percent lower population than that which currently exists in Russia. It is the same way with all of the Eastern European 

countries. We are seeing a depopulation trend. 

The reason why the aggregate continues to grow is that we are 

living longer. It is not about births; it is about the other side of the 

spectrum. In South Korea, they are so far below replacement—

Japan has the same problem—that they are looking at a serious 

disproportionality when it comes to workers and those who are on 

the other end of the spectrum receiving benefits. 

So I think your underlying assumption has been surpassed, in 

many ways, by a depopulation trend that is very injurious to individual countries. And in China, where the sex-selection abortions 

has led to gendercide, there are as many as 100 million missing 

girls, and a whole unique set of problems has developed there. As 

many as 40 million men will not be able to find wives by 2020 because they are gone, they are dead, as a result of sex-selection 

abortion and the one-child-per-couple policy. That is a crime 

against women, of gargantuan proportions. 

So I would ask you to look at maybe some of the underlying assumptions about population growth. There is a depopulation trend 

that is very, very dangerous. 

24

Finally, on obstetric fistula, I pushed very hard with Dr. Kent 

Hill when he was at USAID on behalf of building out the ability 

to meet women’s real needs when they have obstetric fistula. Getting the surgeries that are very low cost and high-impact gives the 

woman her life back. 

Like many of my colleagues, I have been to the hospital in Addis. 

I have been to other obstetric hospitals. Can you give us an assurance that you will not only continue that money, it was $12 million 

at the time, but hopefully significantly expand it? I yield. 

Dr. SHAH. Thank you for those comments and questions. On autism, I will be happy to look at the NGOs you are proposing, and 

we can do that in a systematic manner. 

I do believe the principles of the Global Health Initiative, which 

is to broaden the scope of how we think about supporting health 

systems and setting priorities based on medical need, and based on 

what are the biggest lagging indicators against meeting development goals, will help guide our work in the health sector overall 

going forward. And I appreciate your comments on that issue. 

On instability from population growth, I do believe the 2050 population projections are significant, and they do show over 9 billion 

as a global population. And I think consistent with your comments, 

they show that those increases will happen in certain parts of the 

world, and certain parts of the world will stay flat, and in some 

cases decrease. So I appreciate that, and we will take a nuanced 

look at that very specifically. 

Some of your comments related to gender and girls in that context, which is an immediate priority for our team and for the Secretary. And on obstetric fistula, I do believe our Global Health Initiative, in its reprioritization of obstetric care, of skilled attendants 

at birth, and of focusing on the needs of women and girls, will create a strong strategic priority in that space. 

Thank you. 

Chairman BERMAN. The time of the gentleman has expired. The 

gentleman from Georgia, Mr. Scott, is recognized for 5 minutes. 

Mr. SCOTT. Thank you, Mr. Chairman. Dr. Shah, let me first of 

all commend you and the Obama administration for the very quick 

response to the situation in Haiti. I would like to ask you a few 

questions about that, if I may. 

First of all, as of today, how much money has USAID spent in 

the disaster relief in Haiti? 

Dr. SHAH. I believe the overall Federal commitment has been 

just over $600 million, maybe just over $630 million. We could get 

you a very specific number. 

Of that amount, I think USAID has spent approximately $350 

million, with the majority of the alternative part of that being Department of Defense spending. 

Mr. SCOTT. Which leads to my next question. Where has that 

money been spent, by category? 

Dr. SHAH. I would have to provide you a more specific breakdown, but the major areas have been out of our disaster relief account, which immediately supported priorities for urban search and 

rescue. We sent our two trained international urban search and 

rescue teams, but also four or five other teams that were stood up 

by FEMA, so that we had at any one time more than 500 American 

25

search and rescue professionals with heavy equipment and specialized training at work for an extended period of time. 

We made significant investments in the health space, spending 

resources to take disaster medical assistance teams from the Department of Health and Human Services, and put them in place 

supporting the treatment of more than 30,000 Haitians in that context. And then food and water were immediate priorities that accounted for a large bulk of that spending. We successfully supported the distribution of food to more than 3 million people who 

were at risk, and had some immediate and progressive procurements to make sure that people had as much access to water in the 

camps as possible. We think we successfully met the needs around 

water. That was a big concern in the early moments. 

So those have been the big areas of disaster assistance spending. 

And in addition to that, the Department of Defense, with its personnel and its other resources, and the Comfort Hospital Ship, also 

are cost items that we are tracking. 

Mr. SCOTT. And going forward, Dr. Shah, where do you feel the 

priority should be now? Where is the greatest need now for the people of Haiti? 

Dr. SHAH. Well, the immediate needs are in two areas. One is in 

the collective effort to remove rubble from, and other waste, from 

critical sites, whether they are elevated sites where people could 

live, or whether they are drainage systems that will be critical 

when it rains. 

Linked to that is shelter and sanitation. So we are aggressively 

pursuing those three priorities, with the common goal of reaching 

every Haitian in need with shelter materials, first by March 8, and 

then with an expanded set of shelter materials by April 8. That is 

probably the top and immediate priority. 

A second priority is public health. And we have vaccinated more 

than 150,000. We are trying to reach 150,000 people. I think we 

have reached more than 80,000 so far, in advance of the rainy season. 

Mr. SCOTT. Very good. Now, there have been some reports coming to us from Haiti that, in our efforts to really move forward and 

help them, particularly in our food export area, and particularly in 

the area of rice, which is major farming product of the farmers in 

Haiti; and there has been some concern that maybe our efforts to 

do that have undermined the basic farmers in Haiti, because we 

have over-supplied the market, and thereby putting disincentives 

in for the Haitian people themselves, in farming, to produce their 

own food. 

Can you give us an assessment of that situation, and what are 

we doing to make sure we correct that? 

Dr. SHAH. Well, thank you, I appreciate your raising it. It is an 

incredibly important point. 

What we did was initially, upon sending food, we also sent some 

experts who could track market prices of different food commodities, including rice, vegetable oils, beans, and track the flow of 

charcoal and other cooking supplies in markets, to make sure that 

we were pursuing an assistance strategy that did not impede local 

market systems and resilience. 

26

We have been tracking that closely. We do think we have had an 

aggressive response. The data on rice is varying. The data on beans 

and vegetable oil is that we have not had as significant price effect 

of that. 

And complementary to this effort, we have accelerated our major 

program to support the agriculture sector, including trying to get 

fertilizer support and seeds and other agricultural support out to 

farmers in advance of this planting season. And we will continue 

to track the price of rice closely to make sure we are not distorting 

incentives for local production. You are right to point that out as 

a critical issue. 

Mr. SCOTT. So we do have effective monitoring and evaluation 

and measurement systems in place to measure what we are doing? 

Dr. SHAH. As best we can, in an emergency environment. We 

were getting wildly different price estimates from different markets, which would not take place in a normal setting. So we are 

doing our best, given that issue. 

Mr. SCOTT. Thank you. And again, I commend you for your excellent work. 

Dr. SHAH. Thank you. 

Chairman BERMAN. The time of the gentleman has expired. The 

gentleman from Arkansas, Mr. Boozman, is recognized for 5 minutes. 

Mr. BOOZMAN. Thank you, Mr. Chairman. Secretary Clinton recently stated that we hope one day to put ourselves out of the aid 

business. Because, due to our success, countries will no longer need 

this kind of help. 

Can you give us some examples of how aid initiatives have been 

successful in permanently breaking the cycle of dependence by impoverished countries on outside aid? 

Also maybe in your answer, micro-finance is something that I 

have a lot of interest in. 

Dr. SHAH. Certainly, thank you. I think that is the long-term 

goal for anyone in the assistance business, which is to put ourselves out of assistance because countries effectively graduate. 

The most commonly cited examples are not always the most generalizable ones, like Western Europe after the World War and after 

the Marshall Plan, or South Korea and some other East Asian and 

Southeast Asian economies that were USAID beneficiaries, and 

now are becoming donor countries. And so that is important, they 

are important examples, and we are trying to learn lessons from 

there to apply elsewhere. 

The guidance in the Spence Commission Report I think offers a 

lot of interesting parallels of how we could pursue work differently 

in other parts of the world to achieve those outcomes. 

In terms of more specifically, areas like our Global Health Initiative or our Food Security Initiative are where we are trying to use 

that principle in a more sector-specific manner. So in global health, 

in a country that we prioritize, we will look at our full portfolio of 

activities. We will partner more deeply with countries. We will develop a financial sustainability plan, and we will do our best to 

identify an exit strategy for our partners and our own financing. 

It may be a long exit strategy, but an exit strategy, so that we are 

27

not, so that we are all aiming against that common goal on a more 

sector-specific basis. 

I appreciate your raising micro-finance. This is an important 

area, and the ranking member also made reference to the Development Credit Authority. 

We recently completed a transaction that provided credit authority support to micro-financed institutions through the Grameen 

Bank and its global network. That will leverage more than $160 

million, and provide institutional support to institutions around the 

world to put resources in the pockets of women and vulnerable populations around the world that have a surprisingly high repayment 

rate. And in a financial system that, even though it is banking to 

the poorest, it is an incredibly safe bet to make in terms of repayment rates and risks that the communities take. 

We are also, in the micro-finance area, looking to expand and enhance our investments in the development of other financial services for the poor. Most notably, insurance products and savings 

products that have, recent data and research have shown, are critically important to reducing the vulnerability of those people to all 

kinds of shocks and risks that they experience in their day-to-day 

lives. So we appreciate your comments. 

Mr. BOOZMAN. Very good. One of the other things that I have experienced is, in traveling to various countries, and this is certainly 

not true of all areas. But it does seem like there is a duplication 

of services. You get into turf battles, you know, where USAID is 

there doing a certain function, and then you see duplicative, you 

know, activities by perhaps another branch of the State Department. 

Do you see that as a problem? Is that something that you have 

experienced? And if so, how do we solve that problem? How do we 

get people on the same track? Right now, with the, you know, all 

of us being so aware of the finances, the limited finances that we 

have got, again, I would appreciate your comment on how we would 

tackle that problem. 

Dr. SHAH. I appreciate that. There clearly are, in certain parts 

of the world, a significant duplication of services. And what is a 

clear priority for us is trying to get to a place where we are 

prioritizing efficiency and outcome, and using resources as effectively as possible. 

I think you do that by really three things. The first is you set 

very clear and specific development goals and development priorities. We are expanding our efforts to do that, both in our hiring 

of expertise at USAID and in developing better policy planning and 

evaluation systems. 

The second is we aspire to serve as a whole of government platform to point resources against those goals in an efficient and nonduplicative manner. The learnings from Haiti I think accelerate the 

need to do that. The health sector in Haiti is a good example, 

where we had some unique capabilities at the Department of 

Health and Human Services that were brought into the field. And 

we have been able to transition those capabilities to local NGO 

partners to expand their ability to provide more services to Haitians. We need more examples of that kind of partnership for effectiveness and outcome. 

28

And the third is really to focus on focus and scale as we implement our programs. And so we structured our policy planning to 

do that on a program-by-program basis. 

Mr. BOOZMAN. Thank you, Mr. Chairman. 

Chairman BERMAN. The time of the gentleman has expired. And 

the gentlelady from California, Ambassador Watson, is recognized 

for 5 minutes. 

Ms. WATSON. Thank you, Mr. Chairman. And Dr. Shah, welcome. 

I have really admired your stewardship of USAID. I have been in 

several informational hearings with you, and you give us inspiration that this program is working well. 

I want to relate now to the Lantos-Hyde Act. And if you remember, it mandated a 5-year strategy to treat 4.5 million cases of tuberculosis under DOTS, and 90,000 multi-drug-resistant TB cases. 

The Global Health Initiative, on the other hand, proposes to treat 

only 2.6 million TB patients, and only 57,000 MDR TB cases. Moreover, TB will soon need new drugs to combat the rise in highly resistant TB. 

So what specific initiatives are planned to strengthen country responses to re-emerging infectious diseases such as TB, and how 

will TB treatment be incorporated into a health system-strengthening approach? 

Dr. SHAH. Thank you. I very much appreciate that. I got my first 

experience in tuberculosis, working on a DOTS program in rural 

South India a number of years ago, and recognize how critical and 

important this issue is, and the importance of the legislative targets. 

I would say that the distinction between the targets, in terms of 

the 4.5, 2.6, 90, and 57,000 with respect to MDR, is primarily, I 

believe, the distinction between what we think we can achieve in 

our bilateral programs with current technology and implementation 

protocols, and what we would hope to achieve by getting more efficiencies out of the Global Health Initiative. 

And we can get those efficiencies in two ways. One is as we repackage our complete programs to be more systems-oriented, I fully 

expect, especially given the relationship between TB and HIV, that 

we will actually have more resources that are currently not counting, going toward the joint treatment of TB and HIV, and getting 

those numbers up. 

The second is I think we will partner better with the Global 

Fund, and do more shared system-strengthening investments that 

would expand their capacity and ours to reach TB patients. 

So I believe those numbers, the 2.6 and the 57,000, are really 

floors upon which we can build as we get more efficient, and as we 

partner more effectively. 

The second point I would make is we will increase our research 

and development investments in this space. I am particularly enthusiastic about new diagnostic technologies that I think will detect 

TB earlier, allowing more cases to be treated in the general platform, as opposed to MDR requirements. And that would lower dramatically the cost of each treatment episode. 

I also believe, with new drugs and treatment protocols, over time 

the length of time needed to treat an MDR patient will come down 

significantly, potentially to as little as 9 months. And if that hapVerDate 0ct 09 2002 17:40 May 14, 2010 Jkt 000000 PO 00000 Frm 00032 Fmt 6633 Sfmt 6633 F:\WORK\FULL\030310\55271 HFA PsN: SHIRL
29

pens, that would significantly expand our capacities to offer treatment more broadly. 

So we will track these things very closely, and try to learn from 

some of the more innovative efforts that are taking place around 

the world in TB. 

Ms. WATSON. Yes. Are you seeing TB in Haiti? 

Dr. SHAH. Well, we have had all kinds of reports. We have a 51 

surveillance site system that the Centers for Disease Control has 

set up with our support, tracking diseases. We have not had a big 

outbreak or any specific reporting in that area, but they are out 

there looking for it. And I did see some earlier episodes they 

thought were TB, but then I didn’t get the follow-up that indicated 

that it had been confirmed. 

Ms. WATSON. Thank you for that. The administration has 

stressed country ownership of aid projects. And the true meaning 

of this concept is really unclear to us. Words such as country-based 

and country-led are also in the mix. 

And also, in addition, aid is coming from a variety of sectors: 

GHI, PEPFAR, MCC, and the Global Fund, and so forth. 

So can you tell us what country ownership and its many variations means to you and the administration? And how will this be 

reflected in your policies? And can you expand on how health initiatives will be coordinated within countries already receiving other 

forms of aid, and keeping in mind the country ownership concept? 

Dr. SHAH. Well, thank you. The Global Health Initiative will include all of the investments the U.S. Government makes in helping 

a country to achieve that goal. 

Quickly, the four components of country ownership, to us, are 

country plan, specific guidance from countries that informs our own 

strategic investment, and restructuring our contracts and our programs to abide by those guidances, and sharing data, information, 

and personnel against the common strategy and learning platform. 

I am very enthusiastic about my ability to work with Tom 

Frieden at the CDC and Eric Frisby at the OGEC in order to do 

that more effectively going forward. 

Ms. WATSON. We are out of time. Thank you so much. 

Chairman BERMAN. The time of the gentlelady has expired, and 

I recognize the gentleman from California, Mr. Sherman, for 5 minutes. 

Mr. SHERMAN. Thank you, Mr. Chairman. I believe in foreign aid 

development because it is the right thing to do. But we are told to 

go to our districts and sell it as a necessary component in the war 

on terrorism, something we do for our national security, not just 

out of generosity. 

And frankly, if American people were convinced that it was only 

altruistic, I think we would have an even more difficult time selling 

foreign aid. 

Now, the proponents of foreign aid put forward the idea that any 

alleviation of poverty in the world reduces terrorism. This fits a 

Western morality play view of the world. Because we all desperately want to live in a reasonable world, and so something like 

terrorism must be the just and reasonable response of desperate 

people who are desperately poor. 

30

Unfortunately, we live in an unreasonable world. Poverty does 

not correlate with international terrorism. Both the Christmas Day 

bomber and bin Laden come from some of the richest and most 

powerful families in the world, and a majority of those who struck 

us on 9/11 come from a country that has received far more infusions of cash than USAID has ever dreamed of putting into one 

country or all countries; namely, Saudi Arabia. They were middleand upper-middle-class kids from a country that gets an awful lot 

of American cash. 

Somalia is kind of a separate case. But looking at the world as 

a whole, the poorest 10 percent of the world’s people cause less 

than 10 percent of the international terrorism. So simple poverty 

alleviation itself cannot be justified as a good investment in our, in 

the global war on terrorism. 

Another problem we have is the bureaucracy of USAID. It took 

strong political push to get them to put the flag on the bag. They 

didn’t want to say this aid is from the American people; they just 

wanted to give out the aid. So many of your staff are people that 

wanted to work at OXFAM, but wanted a retirement plan. 

What can you do to make sure that when we select the countries 

and the projects, when we design each part of that project, and 

when we publicize the efforts and decide how much resources to 

put into publicity rather than doing good, and put the money into 

telling people we are doing good, that we are, in fact, honest with 

the American people that this is an effort to win the global war on 

terrorism and to protect them? 

Because as good a goal as alleviation of world poverty is, and as 

much as I would support it, I don’t support telling the American 

people we are doing it to stop terrorism; and then failing to select, 

design, and publicize so that we really are. Given your reluctant 

bureaucracy, what are you doing? 

Dr. SHAH. Thank you, sir, for that comment. I do believe that our 

budget presentation prioritizes the intersection of development investments in specific places and parts of specific civilian and military strategies that are designed to defeat al-Qaeda and support a 

stronger and more effective global security environment for our 

country. It is why we present our budget in the context of Afghanistan and Pakistan, where that is being carried out as a front-line 

state. 

I would also note that we have looked carefully at the data following the Indonesian tsunami, that I know you were involved in, 

with the relief effort there. The branding effort around USAID’s 

giving in that context more than doubled our favorability rating 

among the Indonesian people. And in that same 6-week period 

after the tsunami, it actually reduced by more than half the 

favorability of the Indonesian people in Osama bin-Laden. 

Mr. SHERMAN. I have limited time. I like your answer, and hope 

you will extend it for the record. I just want to urge you to do everything you can to make sure every aspect of design and selection 

reflects what we are telling the American people. 

I want to put forward one idea, and that is, in the impoverished 

world, people have to pay for their kids’ textbooks. If we were to 

print all the elementary school, middle school textbooks, A, we 

could make sure that the content, while not entirely politically corVerDate 0ct 09 2002 17:40 May 14, 2010 Jkt 000000 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 F:\WORK\FULL\030310\55271 HFA PsN: SHIRL
31

rect perhaps from an American perspective, was good; and second, 

we would be helping education; and third, we would be reducing 

corruption, because it is pretty hard to steal textbooks and turn 

them into cash, although I guess you could do it. 

Dr. SHAH. Thank you. 

Chairman BERMAN. The time of the gentleman has expired. The 

gentleman from California, Mr. Costa, is recognized. 

Mr. COSTA. Thank you very much, Mr. Chairman, for this important hearing. And thank you, Dr. Shah, for the good work you are 

doing. 

I am going to cover your efforts in a host of countries that we 

are focused in, and I would like some quick responses. Obviously 

it was noted earlier about our efforts with regard to Gaza and the 

West Bank. How would you assess the results of the infusion thus 

far of aid that has been provided, and the Palestinians’ ability to 

absorb the large amount of American aid, quickly? 

Dr. SHAH. Well, we track that very carefully before making——

Mr. COSTA. No, I know, you noted that earlier. 

Dr. SHAH. Right. 

Mr. COSTA. How would you assess it? 

Dr. SHAH. So I think there has been more success in some areas 

than others. There have been successes in infrastructure and the 

development of road networks and building schools. There have 

been successes in health, in particular with building a stronger 

health system. 

I think there are real challenges, especially in Gaza, where there, 

for a variety of reasons, have been issues with both transport mobility of goods and individuals, as well as some interference. And 

so, so there is much to do to improve the effectiveness of those efforts, and we are working, through our diplomatic channels, to help 

improve that. 

Mr. COSTA. I would like you to provide at a later date written 

notice of both those challenged areas. In Afghanistan and Pakistan, 

obviously those are harsh environments. Many of us have visited 

those countries in the past. 

It is my understanding that USAID personnel are only there for 

a year at length. However, as we know, after the year ends, most 

people are getting their feet on the ground, getting some level of 

understanding of local knowledge. Do you think that is too short 

of a time period, as they are just becoming to be experts in their 

field? Are you considering extending the time? 

Dr. SHAH. We would like to encourage them to stay for extended 

periods of time. We are doing a number of things to facilitate a 

more effective personnel situation in Afghanistan in particular, related to improve——

Mr. COSTA. That could be an administrative change, couldn’t it? 

I mean, if you provide the opportunity to extend beyond a year? 

Dr. SHAH. Well, we have to balance that with our recruiting and 

hiring and on-boarding process, and making sure we have enough 

numbers. 

Mr. COSTA. What if an individual decides, in Pakistan or Afghanistan, they would like to stay beyond a year? What is the normal 

course? 

Dr. SHAH. They absolutely can, if they would like to. 

32

Mr. COSTA. Okay. As it relates, I have had a little bit of experience with some folks from my area who have actually taken the 

time and contributed to build a hospital in Afghanistan outside of 

Kabul. I have seen where some of the other money that has been 

spent by us, where we have had a lot of problems with corruption. 

It just seems to me that we don’t have it right yet, in terms of 

how, whether we are building a road, whether we are building a 

school, whether we are building housing, or in this case a hospital. 

For $2 million they were able to build a state-of-the-art hospital in 

Afshar, Afshar Hospital; 120 beds with seemingly no corruption 

that was involved. 

What are you guys doing to figure out how you can avoid or learn 

from your past mistakes? 

Dr. SHAH. Well, first I will say I am aware of that hospital, and 

appreciate the advance that that represents in the work from members of your district. 

I do think our work in Afghanistan is tracked quite closely. 

Health is a good sector example. We were very selective in working 

with the Ministry of Health. It took a number of years to build the 

financial management and procurement system and other tracking 

systems to give us the confidence that we could enter into the 

agreement we entered into with them last year. 

We have now started to flow resources through that ministry, 

but we track every procurement action quite carefully. We monitor 

every strategic decision. And in addition to that, we have a series 

of audits that take place, both from our IG and the Special Inspector General, to make sure that those resources are being spent effectively. 

As a result of our health sector investments, we believe we have 

more than tripled access to the health system for the population of 

Afghanistan, and we think that is a tremendous achievement. We 

are very optimistic in that space. 

Mr. COSTA. Quickly, before my time expires, Mr. Chairman, I 

would like to see us maybe do more work as it relates to determining how well we are applying smart power, and to ensure that 

the money is going into the right places. 

Which brings me to Iraq. What would you say, as we ramp down 

and USAID ramps up in Iraq, are the lessons learned from the experience of the Department of Defense? 

Dr. SHAH. Well, sir, I think there are a broad range of lessons 

learned. Some relate to contracting, and the risks of very large and 

poorly supervised——

Mr. COSTA. And you are going to apply those lessons? 

Dr. SHAH. Absolutely. We have a contracting reform effort underway. 

Mr. COSTA. And finally, what do you think your biggest challenges are this year? 

Dr. SHAH. Well, our efforts in Afghanistan, Pakistan, and Haiti, 

as well as our health and food efforts. When you put all that together, we will severely strain our work force. And so building a 

strong work force and our ability to do that will be pretty critical 

to success. 

Mr. COSTA. Thank you very much. 

33

Chairman BERMAN. Thank you, Mr. Costa. Your time, the gentleman’s time has expired. And now the gentleman from Minnesota, 

Mr. Ellison, is recognized for 5 minutes. 

Mr. ELLISON. Thank you, Mr. Chair. And thank you, Dr. Shah. 

And let me add my voice to everybody who has thanked you and 

the administration for the speedy response in Haiti. 

I represent Minneapolis, Minnesota, and we have a large Somali 

community there. And they are all—not all, but mostly all concerned about, you know, what is going on in Somalia. 

And I realize that the United States reduced its funding to Somalia last year after OFAC expressed fear that the extended supply line in insurgent-heavy areas where aid agencies were operating meant that aid could be diverted to al-Qaeda-linked groups. 

But on the other side of the coin, the people at the U.N. have 

expressed concern about that, because it results in a net reduction 

to food to people who need it desperately. 

What are the things that you think could be done to straighten 

this situation out? And do you care to offer some views on this? 

Dr. SHAH. Certainly, thank you. Well, first I will start by saying 

that we will follow and respect the law and the guidance around 

protecting and stewarding effectively U.S. resources. 

We have been in a very in-depth conversation with the World 

Food Program, and they have made it—they are our primary food 

distribution partner, as you point out. And they have been very 

clear with us that this is not, that our policies are not impeding 

in any way their capacity to distribute food at this time. They are 

not distributing food more aggressively in Southern Somalia for 

their own safety, security, and logistics capacities to do so in a difficult operating environment. So that is not the current constraint. 

We will work with them, if that becomes the constraint, and they 

have the ability to distribute food that we have to offer to them. 

If they agree to do that, then we will work with them to make sure 

we have a policy in place that supports those efforts. 

Mr. ELLISON. Well, I am going to just submit this article for the 

record, with unanimous consent. 

Chairman BERMAN. Without objection, it will be included in the 

record. 

[The information referred to follows:]

34


55271c.eps
35

Mr. ELLISON. And I will send it to you. And perhaps we could 

flesh out a stronger answer, because I would like to get to the bottom of this. Because it seemed that there was some sort of technical requirements that we are being restricted, and I am sure you 

are aware of the complaint. It sounds like you are saying that it 

may be not a valid complaint. But we will——

Dr. SHAH. Yes. Okay, I am sorry. What I was suggesting is we 

have worked through that, and they are now in a different circumstance. 

Mr. ELLISON. Okay. 

Dr. SHAH. And the circumstance they are in right now, and we 

are in very direct communication, is that that is not an operating 

issue any more. 

Mr. ELLISON. That is great, great. Next is, you know, thank you 

for the work that you do to support the people in Gaza. Do you 

think that USAID could be more effective at its work if USAID personnel were able to enter Gaza? Have you reviewed a process by 

which USAID personnel might actually be able to enter, and not 

just work through surrogates? 

Dr. SHAH. Well, as a general principle, we do believe that our 

presence allows for improved effectiveness. We are reviewing a 

broad range of things we can do to improve the operations in Gaza, 

that include working with partner agencies, U.N. agencies more aggressively; working the diplomatic channels to reduce some of the 

issues in that department. 

Mr. ELLISON. I am sorry, Doctor. USAID is working through surrogates now. That is already happening. I want to know, do you 

think it would be an advantage to having USAID personnel in 

Gaza, you know, since we are already in other tough areas, like Afghanistan, Iraq, and others? 

Dr. SHAH. Well, I think the core constraint for us right now is 

actually mobility, getting items in, and a series of specific issues 

with respect to interference from Hamas and others in that environment. 

In that context, it is not clear that sending our people in is the 

immediate resolution to that. I think the immediate resolution to 

that is solving those problems as a precondition to that. And so we 

are working with others to do that. 

I am happy to review this more specifically, though, and come 

back to you with a more specific answer. 

Mr. ELLISON. Yes. And you know, there are, I mean USAID does 

operate in Gaza. And do you feel that the UNRWA is doing all it 

can to keep materials and supplies away from Hamas? 

Dr. SHAH. Well, you know, we believe UNRWA is an incredibly 

important partner, and needs to be successful at their efforts. And 

so we work in coordination with them. 

You know, I think we all can do a better job at any number of 

things in Gaza, which is a very difficult operating environment for 

the reasons I was identifying. 

Mr. ELLISON. Thank you, Doctor. 

Chairman BERMAN. The time of the gentleman has expired. And 

the gentleman from New York, Mr. McMahon, is recognized for 5 

minutes. 

36

Mr. MCMAHON. Thank you, Mr. Chairman, and Director, it is 

good to see you again. And I am sure I want to join in that chorus 

of all those who have thanked you and your agency for the great 

work you are doing in Haiti in responding to that emergency there, 

as well. And I know the people of Chile need your assistance, as 

well, and that America is doing that. And you kind of put a little 

polish on the reputation of our country being able to respond in an 

effective manner, and that is something that the American people 

are grateful for. 

I also want to thank you for your assistance in allowing the New 

York City Search and Rescue Team to get down there to Haiti. And 

as you know, we put in a resolution recently, under the chairman’s 

leadership, commending USAID and the civilian emergency response team, as well as the military response team. And we are 

grateful for that. 

Dr. Shah, I want to follow up a little bit on the Gaza questions 

that my colleague from Minnesota was asking. The President’s request included $400.4 million in economic assistance for the West 

Bank and Gaza to ‘‘strengthen the Palestinian Authority as a credible partner in Middle Eastern peace, and continue to respond to 

humanitarian needs in Gaza.’’

The request also states that this assistance will ‘‘provide significant resources to support the stability of the Palestinian Authority, 

economic development into the West Bank, and increase the capacity of the Palestinian Authority to meet the needs of its people.’’

Dr. Shah, I would like to reiterate the importance of vetting this 

funding, and of course, supporting Israel. Just yesterday the U.N.’s 

Under Secretary for Humanitarian Affairs, John Holmes, dismissed 

Hamas’s cross-border raid in 2006, the kidnapping of Staff Sgt. 

Gilad Shalit, and Hamas’s unacceptable calls for Israel’s destruction by condemning Israel. Of course, he completely neglected to 

mention the fact that despite Hamas’s aggression, Israel allows 

daily shipments of food, medicine, and other supplies. 

Given these statements, and to follow up again to my colleague 

from Minnesota, how will USAID make sure that this funding does 

not end up in the hands of terrorists, specifically when we are 

partnering with organizations like UNRWA? What sort of safeguards are in place? And if you can be as specific as possible. 

And also, if you could provide an assessment of the effectiveness 

of USAID to Palestinians over the past several years. Which economic projects have been effective, and which have not? Has U.S. 

assistance helped increase popular support from moderate Palestinians in the West Bank, a goal which we all support? And what role 

is United States aid playing in helping to strengthen governing institutions in the West Bank? Basically, are we making a positive 

impact? 

Dr. SHAH. Thank you for those comments with respect to Haiti, 

and the questions with respect to Gaza and the West Bank and 

Israel. 

You know, we do have, as I had noted, we have a very rigorous 

system for vetting partners, and for tracking any cash disbursements all the way through to their end use. On partner vetting, we 

have a very sophisticated system; it has been in place for more 

than 2 years. It tracks the names of all our partners, that clearly 

37

vets all key personnel in any partner organization against a larger 

database, and that allows us to follow up on any positive hits that 

occur in that tracking system. 

After we get any positive hits, we have an aggressive process of 

investigation and review before going forward. So that is a very robust system. 

The cash tracking system is similarly robust. We track any authorized disbursements. We transfer resources through an Israelibased banking account into a special Treasury account in a Palestinian bank, and then we monitor all flows out of that account by 

every single disbursement being tracked specifically to its end use. 

Most of these disbursements, or nearly all of these disbursements 

are used to pay off creditors, so those resources go back out to 

other places. 

The question with respect to how are we coordinating with other 

partners, and what can we do to improve effectiveness, I will just 

say I spoke to John Holmes before he went to make the point that 

you are making, that our goal is about effectiveness in that environment, and that we need to look at the whole picture. It is the 

PRM program that primarily partners with UNRWA, and not 

USAID, although we believe that that is an important partnership 

going forward. So we will continue to have those safeguards in 

place. 

On effectiveness, you know, there are some areas we think have 

been more effective than others. Health and education have been 

perhaps more effective than the full portfolio of infrastructure investments, which are more complex to implement, although there 

have been some success stories there, as well, in the West Bank in 

particular. 

In Gaza, with the mostly humanitarian mission, it is a different 

operating environment. 

Chairman BERMAN. The time of the gentleman has expired. And 

with an impressive show of efficiency of time, Mr. Connolly, within 

45 seconds after entering the room, is recognized for 5 minutes of 

questioning. 

Mr. CONNOLLY. Thank you, Mr. Chairman. I am sorry I am late, 

but we had a weekly breakfast meeting with the Speaker and the 

freshman class, and it went a little bit over. So please forgive me, 

Dr. Shah, for coming in so late. And I thank the courtesy of the 

chairman for allowing me to continue nonetheless. 

Dr. Shah, one of the concerns I certainly have, and I know other 

members of the committee do as well, is that in some ways, USAID 

has been hollowed out in the last decade. And I would hope that 

part of your mission is to turn that around. 

We had Secretary Clinton here in her first appearance before the 

committee—she has been here since—who is certainly committed to 

doing that. But we have seen, for example, a proliferation of aidrelated missions that are not, however, part of USAID. The Millennium Project, and the AIDS Project, and on and on. I would even 

argue that an awful lot of the sort of funds that are used by the 

military in Afghanistan and Iraq really ought to be projectized aid, 

and they are being managed by our military, and hopefully well. 

But those sums are now so substantial, one is concerned about 

38

what could go wrong, and would maybe preferably have them in 

the hands of professionals. 

I wonder if you could address that subject, that whole question 

of how do we consolidate, how do we make sure you are the go-to 

person for bilateral and multi-lateral U.S. assistance? And that we 

remake USAID into a cutting-edge development agency that actually does something, and isn’t just a place that facilitates contracts 

with others? 

Dr. SHAH. Thank you very much for that comment and that 

statement. I believe that right now is an incredibly unique time to 

seize the opportunity to rebuild USAID as the world’s premiere development agency. I think we have a President and a Secretary 

and an administrator completely committed to that goal, and we 

have such strong leadership and support in the congressional committees and in Congress to achieve that outcome. 

I also believe development is a discipline. And I think it is a professional discipline that needs to benefit constantly from the 

learnings of the past and the learnings of the present. And we need 

to represent excellence in the practice of that discipline on behalf 

of all development activities. 

Our game plan for reestablishing our effectiveness and our transparency, our accountability and our operational excellence, is really 

to focus on a handful of strategic priorities. We will focus our work 

in Afghanistan and Pakistan and try to show clear results against 

clear strategic metrics, in Haiti and in our series of key issues, like 

health, food, security, and climate change. 

In each of these areas, USAID can show, through restructuring 

how we do our work, that we can have more impact for less; that 

we can serve as a whole of government platform that invites in 

other partners in a manner that is directed against specific goals 

and specific outcomes, and that makes tough choices about how we 

use resources so we get the most bang per buck of our spending, 

as we tried to do in the relief effort around Haiti. 

We are also pursuing a set of operational improvements, and I 

want to thank the Congress for its leadership in allowing us to 

have the Development Leadership Initiative and rebuild the actual 

Foreign Service Corps of this agency, which you are right to point 

out has been decimated over the past 15 years. 

We think we have a strong position. We have more than 4,000 

Foreign Service nationals that represent people with PhDs and 

medical degrees, and are entirely capable leaders that any other 

private company would think of as a tremendous core asset, for a 

more globally interconnected world. 

We need to rebuild our Foreign Service. We are doing that at the 

mid-career technical level, and we are doing that through the DLI. 

Mr. CONNOLLY. If I may interrupt you, because my time is going 

to run out, but count me as an ally in that effort. 

Dr. SHAH. Thank you. 

Mr. CONNOLLY. The lead development agency, as far as I am concerned, in the United States Government has to be USAID. Not the 

State Department. You are the hands-on guys, you are the people 

with the experience, and you just enumerated that. And that is 

what we have got to work with. 

39

In my 49 seconds left, one thing I just want to sort of put in your 

cap. USAID does provide funding both to NDI and IRI through various spigots. One of the concerns I have had about their work is 

that democratization works from the bottom up, not the top down. 

I would like to see a much enhanced effort at working with local 

governments in those programs. 

Quite frankly, I think we haven’t done such a good job over the 

years in doing that. We have tried, but it is a hard mechanism. But 

they are going to take their lead from where the money flows. And 

I would hope that you would take a look at that. Because I think 

we have the, if we really mean it about democratization, the place 

you build that is at the local level. 

Thank you, Mr. Chairman, my time is up. 

Dr. SHAH. Thank you. 

Chairman BERMAN. The gentleman’s time has expired. I thank 

him for echoing some of my sentiments on these issues, an unusual 

occurrence. And given the time if it is all right with you, I am 

going to recognize myself. No, I am sorry, Mr. Rohrabacher is here. 

You are next, Mr. Rohrabacher. The gentleman is recognized for 5 

minutes. 

Mr. ROHRABACHER. Thank you, Mr. Chairman. How much aid 

have we provided to Afghanistan since 2001? 

Dr. SHAH. I am not sure of the precise number since 2001. 

Mr. ROHRABACHER. Well, how much have we provided this year? 

Dr. SHAH. Well, this year we are proposing, in the Fiscal Year 

2011 budget, that we would be spending $3.9 billion. That is down 

from $4.4 billion in 2010, when you include the supplemental 

amount with the enacted amount. 

Mr. ROHRABACHER. Okay. And how much will we be providing 

Iraq? 

Dr. SHAH. I believe that is going down, as well, from $700 million 

to around $400 million, but I will double-check those numbers for 

you. 

Mr. ROHRABACHER. So with Iraq it is going to be 400. And what 

are some of the programs we are spending $400 million for in Iraq? 

Dr. SHAH. Which programs are priorities in Iraq? 

Mr. ROHRABACHER. Right. 

Dr. SHAH. We have, well, our immediate priority is support for 

the elections, and successfully completing the elections. We are also 

supporting the potential government transitions and ministries 

through a support contract that will work in the aftermath, that 

are currently up and running, but will also continue through that 

critical 4- to 6-month period after the election. And in addition to 

that, we have a number of programs in health and education, economics and agriculture in particular. 

Mr. ROHRABACHER. Do you have the figures with you in terms of 

how much we have spent, how much aid has been spent in Iraq 

since the liberation? 

Dr. SHAH. No, not at the top of my fingertips, but I will follow 

up on that. 

Mr. ROHRABACHER. Maybe you can tell us of the almost $4 billion, $3.9 billion that will be spent in Afghanistan, what are some 

of the programs that Afghanistan will be receiving? 

40

Dr. SHAH. Sure. Well, we have restructured our Afghanistan 

portfolio to be aligned with and very much a part of the President’s 

Afghanistan strategy. We have had two major strategic reviews in 

March of last year, and in December, when the President’s strategy 

was announced by the President. 

The priorities going forward are agriculture, which is the largest 

employer of individuals outside of the government in Afghanistan. 

Our investments there have peaked this year at around $820 million; will come down to $425 million in the 2011 spending. But that 

continued pipeline of investment will be the single-greatest investment in productivity centers and in agriculture. And we are encouraged by some of the early outcomes with respect to performance in that sector. 

We also have major investments, and will continue with major 

investments, in health and education. The health sector is a sector 

where we are partnering closely with the Ministry of Health. It has 

been a number of years in the making to develop a really robust 

partnership with strong auditing trails and financial accountability 

for our spending, and our priorities are on building an effective tertiary-care health system and effective primary-care health system, 

and getting health access out into rural areas to serve the needs 

of women and children in particular, to most effectively reduce 

some of the disproportionate health harms in that context. 

We have a broader range of activities in partnership with other 

departments and the State Department that include security, rule 

of law, counter narcotics. But the USAID-administered programs 

will focus in the areas I described. 

Other economic growth priorities include roads and power, as 

well. 

Mr. ROHRABACHER. So how much did you say was being spent on 

agriculture? 

Dr. SHAH. Well, the Fiscal Year 2010, when you include the supplemental, is around 820. And the Fiscal Year 2011 request is 

around 425. That is agriculture and food security, including alternative livelihoods in rural communities, not including counter narcotic activities. 

Mr. ROHRABACHER. Not including——

Dr. SHAH. Not including counter narcotic. 

Mr. ROHRABACHER. And could you give us an example of some of 

the agricultural spending that we have got? 

Dr. SHAH. Sure. We have programs, well, first we work in close 

partnership with the U.S. Department of Agriculture, where they 

are providing significant technical support to ministries and the 

public sector system. And we are very focused on supporting the 

private sector. 

We have farmer support programs that are getting seed and fertilizer out to farmers through a voucher-based private-sector system. We have programs to help farmers produce high-value products, like apples, and then export them in the region, so they have 

sources of cash and income in addition to the production of basic 

foodstuffs. And we are working to develop improved access to agricultural credit, so that farmers can really support their own pathway out of poverty through agricultural development. 

41

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. Thank 

you. 

Chairman BERMAN. The time of the gentleman has expired. I am 

going to recognize myself for 3 minutes, and Mr. Smith for 3 minutes. 

And I just want to follow up a little more specifically on some 

of the points raised by my colleague from Virginia. In the context 

of what the Secretary has referred to as a key foreign policy priority—that is, development and rebuilding USAID as an institution—specifically, could you talk about the restoration of a budget 

development capacity and a policy planning capacity within 

USAID? And also, in the rebuilding of the staff with the goal of 

doubling the number of Foreign Service officers, to the development 

leader initiative, your priorities for hiring and recruitment of new 

people at USAID. 

Dr. SHAH. Thank you, Mr. Chairman. We have a strong effort underway, through the QDDR, to partner some of our new staff with 

the members of the F Bureau, to identify really a revised and improved budget process that would allow USAID to be financially accountable for the resources it spends. 

It goes without saying that in order to be the world’s premiere 

development agency, we have to be able to account for our spending, and be held to account for resources that are spent in a transparent and clear manner. And so we are actively working on that, 

through the QDDR and through other processes. 

On the policy——

Chairman BERMAN. What about on the impact of developing—the 

accountability is very important. But the question is, are you handed a budget, or do you get to develop a budget? 

Dr. SHAH. We will get to a place where we have the opportunity 

to develop a budget, working in partnership with others. But we 

clearly need to be able to make strategic resource tradeoffs in order 

to be held accountable for the performance of the agency. 

On policy planning, similarly, sir, we are building an active policy-planning capacity. I am pleased to announce we have had real 

leaders in the field, like Ruth Levine from the Center for Global 

Development, that just joined our team. We hope to have a worldclass innovative evaluation capacity that helps us learn from direct 

program beneficiaries, through text messaging all the way through 

doing a range of other efforts, to do randomized control program 

trials to understand the impact of our work most effectively, and 

rebuild our policy planning and evaluation capacities. 

On staff, we have now hired in 420 individuals through the DLI. 

We respect the great leadership Congress has provided. My priorities are to sort of relook at how we do deployments, and more rapidly deploy the DLI individuals to our core strategic and operational priorities, and shorten the length of time that they are in 

the current training program. 

Chairman BERMAN. My time has expired. The gentleman from 

New Jersey is recognized for 3 minutes. 

Mr. SMITH. Thank you very much, Mr. Chairman. 

Dr. Shah, as you know, WHO estimates that up to 70 percent of 

health care in Africa is provided by faith-based organizations. The 

Catholic health care alone in Africa constitutes about 40 percent. 

42

We know that a number of other groups, Samaritan’s Purse, World 

Vision and others are all doing yeoman’s work there. They provide 

expertise, infrastructure, trust to the people, and an enormous 

number of volunteers that otherwise might not be utilized. And 

their ability to expand is incredible. 

What is your view of increasing the partnership with faith-based 

organizations and NGOs, especially as it relates to implementing 

the Global Health Initiative? 

Dr. SHAH. Thank you for that observation. I believe that the 

partnerships and bringing those partnerships into a whole health 

system construct will be critical to the effectiveness of the Global 

Health Initiative. So I would see whether it is in Kenya or other 

countries, where there are significant faith-based organizations 

running hospitals and doing that work, and where we are involved 

in providing support. Our goal is to bring that support within the 

context of the health system, and to make those more formally part 

of an integrated national health plan. 

So it absolutely involves expanding and deepening our partnership. 

Mr. SMITH. I hope you would be mindful that in some countries 

where church opposition to human rights abuses has been very 

strong, when integrated partnerships are formed and the government health ministries and others might be less than quick to want 

to embrace the faith-based community, I would hope that we would 

play a very positive role in suggesting, you know, when it comes 

to health care, we want the maximum impact. 

And certainly it seems to me—and I know in places, and I have 

been throughout Africa—usually when there is corruption or 

human rights abuse by a dictatorship or an authoritarian regime, 

it is reflected in other parts of that government when it comes to 

partnering. So they shun those partnerships in some instances. So 

I would hope that we would help to overcome that. 

Dr. SHAH. Thank you. 

Mr. SMITH. And finally, in 40 seconds, in reading the enterprise 

results reporting, I understand that there is some real problems 

with meeting the 50 percent goal of providing micro-financing to 

the poorest of the poor. 

Could you take a second look at how we might be able to reach 

out to those NGOs that are actually meeting, you know, we had a 

big fight, we did the reauthorization in 2004. I know, because that 

was my bill. And there is a lot of tugs and give-and-take. 

But when it comes to the NGOs that are there on the ground, 

providing maximum benefits to the poorest of the poor, the goal is 

a real one. I think it is achievable. So please take a second look 

at that. 

Dr. SHAH. We will. 

Chairman BERMAN. The time of the gentleman has expired. 

Because of the service for our late colleague, Congressman Murtha, we are going to adjourn the hearing. We thank you very much 

for being here. We look forward very enthusiastically to working 

with you in the future. 

[Whereupon, at 10:48 a.m., the committee was adjourned.] 

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