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THE U.S. REBALANCE IN EAST ASIA:

BUDGET PRIORITIES FOR FY 2016

HEARING

BEFORE THE

SUBCOMMITTEE ON ASIA AND THE PACIFIC

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED FOURTEENTH CONGRESS

FIRST SESSION

APRIL 23, 2015

Serial No. 114–35

Printed for the use of the Committee on Foreign Affairs

(

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

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

MATT SALMON, Arizona 

DARRELL E. ISSA, California 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

PAUL COOK, California 

RANDY K. WEBER SR., Texas 

SCOTT PERRY, Pennsylvania 

RON DESANTIS, Florida 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

CURT CLAWSON, Florida 

SCOTT DESJARLAIS, Tennessee 

REID J. RIBBLE, Wisconsin 

DAVID A. TROTT, Michigan 

LEE M. ZELDIN, New York 

TOM EMMER, Minnesota 

ELIOT L. ENGEL, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

BRIAN HIGGINS, New York 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

ALAN GRAYSON, Florida 

AMI BERA, California 

ALAN S. LOWENTHAL, California 

GRACE MENG, New York 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

BRENDAN F. BOYLE, Pennsylvania

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

SUBCOMMITTEE ON ASIA AND THE PACIFIC

MATT SALMON, Arizona Chairman 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

SCOTT PERRY, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

BRAD SHERMAN, California 

AMI BERA, California 

TULSI GABBARD, Hawaii 

ALAN S. LOWENTHAL, California 

GERALD E. CONNOLLY, Virginia 

GRACE MENG, New York 

(III)

C O N T E N T S 

Page

WITNESSES 

The Honorable Daniel R. Russel, Assistant Secretary, Bureau of East Asian 

and Pacific Affairs, U.S. Department of State ................................................... 5

The Honorable Jonathan Stivers, Assistant Administrator, Bureau for Asia, 

U.S. Agency for International Development ...................................................... 17

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

The Honorable Daniel R. Russel: Prepared statement ......................................... 7

The Honorable Jonathan Stivers: Prepared statement ........................................ 19

APPENDIX 

Hearing notice .......................................................................................................... 38

Hearing minutes ...................................................................................................... 39

The Honorable Alan S. Lowenthal, a Representative in Congress from the 

State of California: Material submitted for the record ..................................... 40

(1)

THE U.S. REBALANCE IN EAST ASIA:

BUDGET PRIORITIES FOR FY 2016

THURSDAY, APRIL 23, 2015

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON ASIA AND THE PACIFIC,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The subcommittee met, pursuant to notice, at 1:08 p.m., in room 

2172, Rayburn House Office Building, Hon. Matt Salmon (chairman of the subcommittee) presiding. 

Mr. SALMON. Good afternoon. The subcommittee will come to 

order. 

I would like to thank our distinguished witnesses, Assistant Secretary of State Daniel Russel and Assistant Administrator for 

USAID Jonathan Stivers, for being here this afternoon. 

We called this hearing to assess U.S. foreign assistance to East 

Asia and the Pacific for Fiscal Year 2016. This is a critical topic 

because it is clear that the future of the United States is inextricably linked with East Asia. 

The region encompasses many of the greatest opportunities for 

our country. What remains to be seen is what shape its future will 

take because some of our greatest strategic challenges also come 

from East Asia. For example, the United States should assist in the 

peaceful resolution of maritime disputes and military buildup in 

the South China Sea or we risk tensions erupting into kinetic conflict. 

The United States must engage in new trading relationship with 

burgeoning regional powers in Asia through the Trans-Pacific Partnership or we risk markets could remain restricted to our businesses. The United States must retain its leading role in ensuring 

the peaceful sharing of land, sea, air, and cyberspace or we risk 

paving the way for less savory alternatives, such as the dominance 

of authoritarian Chinese rules and norms. 

As a Pacific power, the United States must seek positive outcomes for these challenges and others. We also need to balance 

these challenges abroad with our financial constraints at home, 

which will require allocating U.S. funds efficiently and effectively. 

The administration initially proposed a rebalanced Asia as a centerpiece of its foreign policy. However, the follow-through we have 

seen on the rebalance or the pivot has not reached its full potential. Last week I spoke at an event with Senator McCain, and he 

observed that we had not yet truly pivoted. I agree. 

2

The attention given to East Asia and the Pacific by the administration does not seem to be indicative of a concerted effort. In Fiscal Year 2015, the East Asia Bureau’s budget is the second smallest of any of the State’s regional bureaus. 

If we are ever to truly rebalance, the effective allocation of foreign aid for the region, rather than the sheer amount we spend, 

must be the critical factor for our foreign aid spending in the Asia 

Pacific. I am eager to hear from our distinguished witnesses today 

about their respective efforts on this issue. 

In China, we are supporting sustainable development, environmental conservation, and cultural preservation initiatives in Tibetan areas as well as HIV/AIDS programs, international narcotics 

control and law enforcement, and democracy programs. Over the 

last few years, we have seen reduced funding for democracy, 

human rights, and rule of law programs, which I am concerned 

about because of increased levels of repression from the Xi administration, which puts at risk our efforts in these areas. The controls 

and limits on the freedom of expression have indicated that the 

Chinese Government intends to rule by law rather than uphold the 

rule of law. 

Moving to Southeast Asia, I have concerns about countries in the 

Lower Mekong region, which includes Burma. Cambodia, Laos, 

Thailand, and Vietnam. I see that this year’s budget request for 

the Lower Mekong Initiative is nearly 20 percent lower than last 

year’s. This broad initiative supports aid programs and education, 

the environment, health, food security, and infrastructure. 

And I would be very interested to hear the reasoning behind its 

deemphasis in this year’s budget. I am particularly interested to 

hear the witnesses’ views on whether this reduction will constrain 

the U.S. presence in the Lower Mekong, especially now, in light of 

China’s aggressive infrastructure investments in the region and the 

U.S.’s exploration of closer relations with nations such as Vietnam. 

This year’s budget requests reflect an increase and involvement 

with Vietnam, which is a forward-looking decision. Though our current efforts for Vietnam are still focused on disease control and development, we are also working toward the U.S.-Vietnam relationship of the future by helping to improve governance, strengthen 

civil society, improve human rights conditions, and to promote Vietnam’s involvement in the TPP. Our aim should be continuing to 

support Vietnam’s transformation to become a more responsible 

and inclusive partner. I look forward to discussing these priorities 

with Vietnam when I travel to the region in just a couple of weeks. 

I am pleased to see that this year’s budget request places significant emphasis on enhancing the defense capabilities of Indonesia, 

Vietnam, and the Philippines through foreign military financing as 

well as training in anti-terror programs. We have had longstanding 

and productive counterterror cooperation with Indonesia, and helping the world’s largest Muslim-majority nation to deal with radicalism should continue to be a top priority. Vietnam and the Philippines, as claimants in the South China Sea, face heightened risk 

of state-to-state conflict due to China’s aggressive island-building 

in disputed waters. So the security emphasis we see for these two 

nations in this year’s request is welcome, also. 

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President Reagan once said, ‘‘We can’t help everyone, but we can 

help someone.’’ Our mission here today is to hold a dialogue about 

which ‘‘someones’’ to help. And it is a truly exciting and daunting 

time to have these kinds of conversations because the East Asia 

Pacific presents colossal opportunities and vexing challenges. I give 

my sincere thanks to my colleagues today and our witnesses for 

joining me in this conversation today. 

And I turn the time over to Mr. Lowenthal for any opening statements he might have. 

Mr. LOWENTHAL. Thank you, Mr. Chairman. 

And thank you, witnesses, for joining us today. 

As you have just heard, we are at a critical junction for U.S. foreign policy in Asia. And I look forward to hearing how the United 

States can advance our security interests, our quality of life and 

our human rights, and promote human rights and democracy in the 

region. 

With the ongoing negotiations on the Trans-Pacific Partnership, 

there is no better time to have an open and frank discussion about 

U.S. priorities in Asia. I believe that the United States can play a 

key positive role in Asia by promoting universal ideals of human 

rights. 

Cambodia, a country with a long and bumpy and often winding 

road to democracy, can benefit greatly from the United States’ assistance in building democratic institutions. In Vietnam, an autocratic, authoritarian regime must be made to improve its human 

rights record. 

I would also like to highlight the challenges posed to the United 

States’ security interest by the ‘‘threat multiplier of climate change 

and rising sea levels, which will disproportionately affect over 1 billion people who live along the coast in this region, many of whom 

depend upon the rivers, the estuaries, and the oceans for their livelihood.’’

As the United States seeks to build international consensus to 

limit carbon emissions, we must also work with countries in the region to prepare for an already changing climate. 

Thank you, Mr. Chair. And I yield back. 

Mr. SALMON. Thank you, Mr. Lowenthal. The Chair yields to Mr. 

Rohrabacher. 

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. 

I have been around here for about 28 years now, and I have always understood, being a Californian, that Asia plays a significant 

role in the well-being of the people of the United States of America. 

If we don’t have good policy toward Japan and China and the Philippines, Vietnam, Korea, that region of the world, we will not prosper, nor will we be secure. 

Those of us, as I say, in California know more about that. And 

I served with Ronald Reagan in the White House, and he certainly 

understood that. Today, however, there are serious challenges, but 

they are over the horizon. They have yet to come into view. 

And I would suggest that the emergence of China as such a powerful entity and a China that has had absolutely no political reform—they have had lots of economic reform and they have—people say, ‘‘Oh, no. They are having all this reform.’’

4

No. They are not having any reform as long as they maintain 

that the government has total control over the political process. 

There are no opposition political parties there. People are not permitted to have private newspapers that criticize the government. 

They have hundreds of thousands of people—or 100,000 people 

tracking down anyone on the Internet that criticizes the basic nature of their system. And this is a monstrous threat that is just 

over the horizon. 

Let me note for my friends who are so aggressively attacking Mr. 

Putin in Russia and their shortcomings in Russia, which there are 

many, there have been numerous reforms in Russia compared to 

China. Yet, we continue with a hostile attitude toward Russia and 

more of an open attitude toward China. So I am looking at that 

very closely. 

And one thing that gives me heart that we will be able to confront any emerging threat in the Pacific is that Japan now is moving forward to basically step into its rightful role as a major power 

in the Pacific and Asia. We have had for far too long the stigma 

of World War II in which the Japanese were totally wrong and 

committed some monstrous acts, just like the Germans were totally 

wrong and committed monstrous acts. 

But we forgave the Germans a long time ago. And we now have 

the Germans actually involved with peace efforts in Ukraine. They 

are sort of in charge of that. Well, Japan is ready to step up into 

that role in Asia and the Pacific. And the United States needs to 

have a strong partnership. 

Next week we have President Abe coming to visit, to do a joint 

session of Congress. I think this is a good way to inaugurate a new 

era of relations between Japan and the United States and, hopefully, a new era of security and a new era of peace and prosperity 

in the Asia-Pacific region. 

Thank you, Mr. Chairman, for holding this hearing today. 

Mr. SALMON. Thank you. 

Would you care to make some comments, Mr. Sherman? Any 

opening comments? 

Mr. SHERMAN. Just a few. 

First, there is some confusion on the floor of the House as to 

when I will be recognized to do a special order, this being the 100th 

anniversary of the Armenian genocide. And so I will need to balance my responsibilities here with that special order. 

With regard to these hearings, I will try to be brief, showing up 

late. 

And I do want to point out, Mr. Russel, that I hope that you 

would be with others at State and the intel community, giving our 

subcommittee and, perhaps, the Terrorism, Nonproliferation, and 

Trade Subcommittee a classified briefing on the China 123 Agreement that the administration has set forth before us. 

I would urge members and those staff members that have classified clearances to go see the reports and classified information on 

this and particularly focus on two things, first, whether China is 

doing a robust or even adequate job on making sure that its private 

and quasi-private entities are adhering to nonproliferation standards. 

5

And, second, I urge members and those staffers with security 

clearance to focus on whether China is using nuclear technology 

which they promised would be used only for civilian purposes for 

military purposes. So I look forward to looking at that issue. 

As to the panoply of issues that we will deal with at this hearing, 

I think other opening statements have covered that. There is no 

more important region in the world for the United States than 

Asia, which is why we have all chosen to serve under the leadership of our chairman on this subcommittee. 

I yield back. 

Mr. SALMON. Thank you. 

We thank the State Department and USAID for our knowledgeable witnesses this afternoon. 

Assistant Secretary Russel joins us from the State Department’s 

Bureau of East Asian and Pacific Affairs, and we are grateful to 

Assistant Administrator Stivers of USAID’s Bureau for Asia for returning as this his second time testifying before the subcommittee. 

And, without objection, the witnesses’ full prepared statement 

will be part of the record. And members will have 5 calendar days 

to submit statements, questions, and extraneous materials for the 

record. 

And, with that, Mr. Russel, I will turn to you first. 

STATEMENT OF THE HONORABLE DANIEL R. RUSSEL, ASSISTANT SECRETARY, BUREAU OF EAST ASIAN AND PACIFIC AFFAIRS, U.S. DEPARTMENT OF STATE 

Mr. RUSSEL. Thank you very much, Mr. Chairman, and Ranking 

Member Sherman, members of the subcommittee. And thank you 

in particular for the committee’s support of our work with the East 

Asia-Pacific region and for the opportunity also to testify today 

about President Obama’s Fiscal Year 2016 budget request. And I 

am pleased, of course, to be here with my colleague from USAID, 

John Stivers. 

As you pointed out, Mr. Chairman, in your opening remarks, our 

strategy toward the region reflects the fact that the U.S., as a Pacific power and as a trading Nation, finds the Asia-Pacific region 

hugely consequential to our interest. It is consequential for our security, for our economy, and its importance will only grow. 

Over the last 6 years, the administration’s rebalance policy has 

established what I would call a new normal. It is a pattern of relations that is marked, first, by sustained engagement with the region by the President, by the Secretary of State, other Cabinet 

members in the Government and, second, marked by an unprecedented and extensive collaboration with our Asian allies, with our 

partners, on a full range of regional and global issues that face us. 

And the results of this policy and the benefits to the people of 

the United States are very clear. One, we are safer. We are safer 

because our alliances in the region, especially with Japan and 

South Korea, the Philippines, and Australia, have never been 

stronger. And that is shown by updated defense guidelines, by increased host nation support, by rotational force agreements. And 

we have also built closer security relationships with other new 

partners and longstanding partners, like Singapore or New Zealand. 

6

Second, our economy benefits. Since 2009, U.S. exports to East 

Asia are up about 23 percent and we are nearing conclusion of the 

Trans-Pacific Partnership, TPP, agreement. This is a trade agreement that also has unprecedented protections for workers, for the 

environment, and the digital economy. We welcome warmly the introduction of bipartisan, bicameral legislation for trade promotion 

authority, which will help us complete this agreement. 

Third, Mr. Chairman, we are promoting stability in the region. 

Our deeper engagement with China has helped our two Governments to make progress on areas of common interest, like climate 

and bilateral investment, helped us to calm tensions with the military-to-military dialogue that we have established. It facilitates the 

exchange of ideas and of commerce by extending student visas and 

business visas while always standing up for human rights, standing up for international law, standing up for American workers and 

businesses. And throughout the region, our commitment to universal values is key to the strength of the American brand. 

Fourth, I mention our work to strengthen regional institutions 

and organizations, like APEC, like ASEAN, like the East Asia 

Summit. This supports economic growth and also helps us manage 

complex disputes like those in the South China Sea, and our engagement with nations like Indonesia, Malaysia, Vietnam, and 

Burma position us to participate in the dynamic Southeast Asia 

area, a youthful area with a fast-growing middle class that already 

numbers in the hundreds of millions. 

The $1.4 billion budget for East Asia and the Pacific in 2016 

helps us build on these accomplishments. Our requested increase 

of $75.4 million, which is 6 percent over 2014, will allow us to 

maintain a robust presence as a preeminent trade and investment 

partner, a security guarantor, a champion of democracy, development in good governance. 

And the $845 million for foreign assistance sustains and expands 

our funding for the region in areas such as regional security cooperation, inclusive economic growth and trade, democracy, regional institutions, and war legacies in Southeast Asia and the Pacific. 

I would add, Mr. Chairman, that 2015 is a very big year for the 

U.S. in the region. We have got anniversaries, the 70th anniversary 

of World War II, 50th anniversary of Singapore’s independence, 

50th anniversary of normalization between Japan and Korea, 20 

years since normalization with Vietnam. The ASEAN economic 

community will be launched this year, a step forward in regional 

integration. And four Asian leaders will visit the White House, beginning, as you mentioned, with Japanese Prime Minister Abe next 

week. 

We have a lot to discuss. And I am happy to take your questions 

once my colleague has made his statement. Thank you. 

[The prepared statement of Mr. Russel follows:]

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Mr. SALMON. Thank you. 

Mr. Stivers. 

STATEMENT OF THE HONORABLE JONATHAN STIVERS, ASSISTANT ADMINISTRATOR, BUREAU FOR ASIA, U.S. AGENCY 

FOR INTERNATIONAL DEVELOPMENT 

Mr. STIVERS. Chairman Salmon, Ranking Member Sherman, distinguished members of the subcommittee, thank you for the invitation to testify on the role of USAID in advancing our foreign policy 

goals in the East Asia and Pacific region. 

It is an honor to appear here before the committee again. Having 

worked in the House of Representatives for almost two decades, 

this side of the Capitol always feels like home to me. And it is also 

a pleasure to be here alongside my colleague, Assistant Secretary 

Daniel Russel. 

The President’s budget request of $845.6 million for the East 

Asia-Pacific region represents an 8-percent increase over Fiscal 

Year 2014, laying the foundation for strengthening our relationships in Asia. 

It is an exciting and pivotal time for U.S. policy in Asia. Hundreds of millions have been lifted out of poverty, and economic 

growth is strong. Yet, the region still has the bulk of the world’s 

poor; 70 percent of the world’s malnourished children; a majority 

of all natural disasters occur in this region; and a host of other development challenges related to governance, human rights, trafficking, and gender empowerment. 

President Obama’s Asia-Pacific Rebalance policy recognizes that 

our future is inextricably tied to this region. In Asia, we are working through three primary approaches to implement USAID’s mission to end extreme poverty and promote resilient democratic societies, while also advancing our own security and prosperity. 

First, we are institutionalizing USAID’s new model of development, which leverages the private sector, innovation, and regional 

approaches to do more with less. In the last 5 years, USAID has 

moved from just 8 percent of its resources programmed for this 

model, which leverages the private sector, to 40 percent. 

Second, through the Presidential initiatives on Global Health, 

Feed the Future, and Climate Change, USAID is helping to achieve 

historic results that improve health, fight disease, increase food security, and help communities manage a changing environment. 

Third, USAID is promoting democratic governance and empowering reformers. Solutions to challenges will ultimately come from 

the people of the region, and our best chance of promoting democratic change and human rights is to empower the reformers. For 

this reason, this budget request includes increases in funding for 

democratic governance and human rights for almost every country 

in the region, representing the administration’s desire to robustly 

fund such programs. 

Next, I will delve deeper into select countries. In Burma, this is 

a pivotal year with national elections scheduled for November. At 

the core of our efforts is our support for civil society organizations 

that are working to hold the government accountable and to help 

those resisting discrimination and violence. 

18

USAID is helping prepare for the elections by building the capacity of the election commission, training domestic election observers, 

supporting voter registration and education, and strengthening the 

capacity of political parties. In Rakhine State, USAID continues to 

support humanitarian assistance to the Rohingya population. This 

is a dynamic period in Burma and, as it progresses, we will be reassessing the nature of Burma’s needs in close consultation with 

Congress. 

In Cambodia, promoting democratic governance and human 

rights continues to be our highest priority. Civil society, while not 

fully respected by the government, has grown in vibrancy and 

strength in recent years, thanks in part to USAID assistance. In 

health, USAID has helped Cambodia meet its Millennium Development Goals on child and maternal mortality ahead of schedule. The 

country has set an ambitious goal of a zero incidence rate for 

HIV/AIDS by 2020. To combat human trafficking in Cambodia, 

technology developed by USAID partners is raising awareness of 

safe migration to reduce the number of victims and prevent trafficking. 

Indonesia is a democratic success story, but there are major governance challenges. USAID is partnering to support the Anti-Corruption Commission, strengthen the judicial system, and promote 

Indonesian civil society. USAID also partners with Indonesia to 

protect and manage ocean and coastal resources. USAID has 

helped secure a commitment by the world’s leading palm oil producers to transition to sustainable production that breaks the link 

with deforestation. 

In the Philippines, our Partnership for Growth initiative promotes economic growth and good governance. It has contributed to 

the Philippines becoming one of the fastest growing markets for 

U.S. food and farm products. Since Typhoon Haiyan struck, we 

have strengthened our partnership to mitigate the risk and impacts 

of natural disasters and rebuild typhoon-affected communities. 

Lack of formal access to land ownership is a key cause of poverty 

and a driver of conflict. Land reform is a USAID priority and we 

continue to work to improve the regulatory environment and 

streamline the land registration process. 

In Vietnam, USAID’s Governance for Inclusive Growth program 

provides technical assistance to improve compliance with trade 

agreements, rule of law, and improve our access to Vietnam’s growing market for U.S. exports. In addition, USAID is focused on addressing war legacies, health and disabilities, and has reduced susceptibility to climate change and natural disasters. 

Mr. Chairman and members of the committee, the future development and growth of the East Asia and Pacific region is ever more 

important to our own future. I appreciate the opportunity to testify 

today, and I look forward to hearing your thoughts and any questions. 

[The prepared statement of Mr. Stivers follows:]

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Mr. SALMON. Thank you. 

Now time for member questions. I will start it off. 

I am extremely worried that the existing model of U.S. funding 

for programs in China is going to be impossible to sustain because 

the recipients of the funds for China predominately have been U.S.-

based NGOs and universities. 

However, China’s National People’s Congress is moving ahead 

with legislation right now called the Overseas NGO Administration 

Law. Though subject to typically opaque procedures, it seems that 

this law will block virtually all foreign funding in Chinese civil society and hamstring NGOs operating on the Chinese mainland. 

How could this law affect State’s activities in greater China, including democracy, human rights, rule of law? And how will State 

approach China about current deliberation on this legislation? 

Mr. Russel. 

Mr. RUSSEL. Thank you, Mr. Chairman. 

Human rights and universal rights—not American values, but 

universal rights—is a major element of our ongoing dialog with 

China. In that connection, we miss no opportunity to underscore 

the importance that we place not only as Americans, but in our 

partnership and our bilateral relationship with China, on the vitality and the ability of civil society to operate freely and to act. 

We have, from President Obama and Vice President Biden on 

down, repeatedly made the point directly to China’s leadership that 

NGOs, that civil society, that the free exchange of ideas, and the 

ability of citizens to engage and participate in political life of the 

nation is a critical element to sustainable economic growth. 

We have made the point that, for China to avoid the middle income trap and to move from a manufacturing economy to an information economy, which is what the 21st century requires, it is essential that they allow groups to operate, including and especially 

NGOs, both foreign and domestic. This is an important part of our 

dialogue. 

In terms of funding——

Mr. SALMON. Are we communicating that pretty robustly with 

our counterparts in China? 

Mr. RUSSEL. Yes. I have been in meeting after meeting, as I mentioned, with the President, the Vice President, and the Secretary 

of State, in which we have emphasized that point. I myself have 

met with Chinese NGOs during my visits to China. 

There are areas where the Chinese authorities allow them to operate, but there are constraints. And we believe strongly that the 

direction that China would be well advised to move in is in loosening, not tightening, those constraints. 

In terms of funding, I will defer to my colleague, Mr. Stivers. The 

bulk, though, of the programs that we support are aimed specifically at the communities in Tibet as part of our effort to sustain 

the linguistic, religious, and cultural traditions there. 

Mr. SALMON. If they do pass this law and it becomes imminently 

more difficult to go through NGOs and universities, do we have a 

Plan B? 

Mr. RUSSEL. Well, we are in discussion. We looked seriously at 

that set of issues. We want to ensure that Chinese university students and groups, including NGOs, continue to have the opporVerDate 0ct 09 2002 11:01 Jun 24, 2015 Jkt 000000 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 F:\WORK\_AP\042315\94310 SHIRL
27

tunity to visit the United States, to study in the United States, and 

that we, as well as international NGOs, can operate to the benefit 

of the Chinese people as well as the international community. 

Mr. STIVERS. Thank you. Thank you, Assistant Secretary. 

I just want to clear up, in terms of USAID’s perspective, there 

is no funding in this budget request for the Chinese Government 

or that would benefit the Chinese Government. Certainly they can 

fund their own development programs. 

The funding in this request focuses on Tibetan communities, one 

of the most vulnerable and repressed populations in the world. And 

this committee and you, Mr. Chairman, and Mr. Sherman and Mr. 

Rohrabacher have really been leaders on that over the years. And 

I worked a bit on that when I was a staffer in Congress, in terms 

of that assistance. 

There is a small amount of health funding that is part of our regional funding, which does affect southern China. But the funding 

in this request is for the Tibetan community in the Tibetan Plateau. 

Mr. SALMON. Thank you. 

I am going to run out of time. But I do have one other question, 

and it relates to the situation in Hong Kong. 

The situation in Hong Kong’s Umbrella Movement in the pro-democracy protests of 2014 have evoked worldwide sympathy, but 

failed to gain true universal suffrage for the Chief Executive elections. 

I was there for the hand-over ceremony. I remember all the 

promises that were made about one country, two systems, and it 

is not materializing as it was promised it would. 

What are we doing with the administration?With State? What 

are we doing to try to make some headway on that issue? I am 

very, very fearful that it is going to get more dicey before it gets 

better. 

Mr. RUSSEL. Mr. Chairman, I have visited Hong Kong. I have 

met with senior officials there. We have a very active consul general, and we engage both in the mainland and Beijing and directly 

in Hong Kong with the authorities in all of the political parties and 

protagonists as well as the business community. 

We have made it clear to the Chinese authorities that the international community and the United States expect them to honor 

their commitments under the basic agreement. We have made clear 

that the introduction of universal suffrage is a key element to living up to the promise of one country, two systems. 

And we have also underscored that the role that Hong Kong 

plays in the Chinese as well as the international economic community is a function of its tradition of openness and respect for the 

rule of law. That is a central tenet of Hong Kong’s success and, 

therefore, of China’s success. 

We believe that a society with the greatest degree of autonomy 

that listens to the voices of its citizens is going to thrive, and we 

have made that very clear. 

Now, it is for the Hong Kong Government and the legislative 

council, LegCo, and the people of Hong Kong to decide specifically 

about the pending proposal from the government with regard to 

universal suffrage. And so, on that score, we will defer to them. 

28

But we have made clear the importance that we place on allowing Hong Kong’s residents to have a meaningful choice in the selection of their own Chief Executive. 

Mr. SALMON. Not to have to pick from some list that Beijing has 

given them, a list of three people that they have determined that 

they can choose from. 

We are going on a codel in 2 weeks to Hong Kong. Eliot Engel, 

the ranking member of the full committee, is accompanying me. 

Mr. Lowenthal, I believe, is as well. 

And we intend to meet with some of the student protestors and 

some of the folks that are very, very concerned about the eroding 

of democracy in Hong Kong, and we intend to make a big issue of 

it. 

And we hope that we can work very closely together with State 

throughout the next weeks and months and years to make sure 

that we get accomplished what the Hong Kong people deserve and 

the world deserves. Thank you. 

Mr. Sherman. 

Mr. SHERMAN. Thank you, Mr. Chairman. And thanks for an 

order of questioning that will allow both myself and Mr. Lowenthal 

to complete our responsibilities here. 

There is talk about whether our aid programs would benefit 

China. Over in the Ways and Means Committee, they are looking 

at an agreement that will be of tremendous benefit to China, namely, the TPP and the TAA and the fast-track bill that goes with it 

in two ways. 

First, it enshrines the idea that you can do a free-trade agreement and have absolutely no title about currency manipulation. 

Second, it will contain the rules of origin so that goods that are 60, 

70, even 80, percent made in China can then go to Vietnam for a 

little additional work, slap a ‘‘Made in Vietnam’’ sticker on it, and 

duty-free entry into the United States while we get no access to the 

Chinese market. 

So I know the chairman wouldn’t want to see our aid money go 

to China, but I think that many, many of our jobs will be going. 

I want to thank the chairman for working with me—or I am 

working with him—on the bill to help Taiwan enter INTERPOL. 

Who could be against international crime fighting? And I hope very 

much that the administration—I should actually ask the administration. 

Mr. Russel, will you be working in every way for Taiwan to able 

to be part of INTERPOL? 

Mr. RUSSEL. Thank you very much, Congressman Sherman. 

Let me begin with TPP. And perhaps I will not surprise you by 

saying——

Mr. SHERMAN. I have got very limited time. I will ask you to 

focus on INTERPOL. 

Mr. RUSSEL. Okay. 

Mr. SHERMAN. That was kind of my opening statement. 

Mr. RUSSEL. Well, without a doubt, though, with all due respect, 

TPP benefits the United States and our partners immensely. And 

we hope that it will——

Mr. SHERMAN. Mr. Russel, I will interrupt you. I have asked you 

to focus on INTERPOL, but I will respond. 

29

These deals are part and parcel of an effort that has destroyed 

the American middle class over the last 30 years. And to say it is 

going to benefit the United States when there isn’t a single economic study of any merit that says that it will raise wages in the 

United States and a program that tells us that we count all the 

jobs that we get from exports without subtracting the jobs we lose 

from imports, an economic analysis that leaves out the rules of origin that I focused on—I will use my time to make those points and 

ask you to answer the question about INTERPOL. 

Mr. RUSSEL. We strongly support and have been active in helping to promote Taiwan’s international space and its active participation in appropriate organizations, including INTERPOL. 

We want Taiwan to be a member of organizations for which 

statehood is not a prerequisite, and we want Taiwan appropriately 

to interact, whether as an observer or as the beneficiary of technical programs and other kinds of institutions. 

We very much agree that Taiwan is a net contributor to international law enforcement, and we are looking for ways to build on 

that. 

Mr. SHERMAN. Good. 

The focus of our hearing is on rebalance and budget, but we are 

leaving out at this hearing the big rebalance budget effect. And 

that is what is happening over in the Pentagon, where they are engaged in a reconfiguration of our military, starting with research 

and then procurement, that will end up costing this country literally trillions of dollars as we over the next decade or two devote 

a very expensive military not to defending the United States from 

those who have killed Americans, but, rather, to help fight over a 

few islets that are of so little economic value that they are completely uninhabited. 

And we will be told, ‘‘Oh, but there is oil there.’’ There isn’t. But 

if there is, it is not our oil. And we will be spending far more on 

this than the countries who claim these islets where there isn’t any 

oil that might belong to them. So this is the real budgetary rebalance. 

Mr. Russel, I hope you would provide for the record a comparison 

of Japan’s military budget to whatever share your study would indicate is the share of our military budget devoted to the Asia-Pacific region. 

Because every time I talk to the Pentagon about training, about 

procurement, about research that will help us in the war on terrorism, their response is, ‘‘We have limited money and we are gearing up to fight China.’’ And it is a very bad idea. Oh. And, by the 

way, there is no oil. And it is not our oil. 

I yield back. 

Mr. RUSSEL. Thank you very much, Congressman Sherman. 

There are two indispensable ingredients to America’s future prosperity. Number one is security in the Asia-Pacific region. Number 

two is free trade and open markets. And our rebalance strategy, including TPP, secure those interests for us. We are——

Mr. SHERMAN. Mr. Russel, I thought my time had expired. Because I usually do get to control the time. 

And I will simply say MFN for China devastated the American 

middle class. And now we are going to squeeze what is left of them 

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to be able to finance efforts to confront China militarily while we 

then figure out ways, without an agreement where China is a signatory, to shift our jobs to China just in case there are pockets of 

middle class prosperity somewhere in America that haven’t yet 

been devastated by this policy. 

So I yield back. 

Mr. SALMON. The gentlemen’s time has expired. 

Mr. Lowenthal. 

Mr. LOWENTHAL. Thank you, Mr. Chair. 

And thank you, Mr. Rohrabacher, for allowing me to jump forward. I really appreciate that. 

I, along with Chris Van Hollen, Congressman Van Hollen, Congressman Peters, and more than 50 of our House colleagues sent 

a letter supporting the President’s Green Climate Fund request of 

$500 million. This fund would be used to invest in resilient and 

low-emission development in East Asia and around the world, Mr. 

Chairman. I would like to, Mr. Chairman, enter that letter into the 

record, if I may. 

Mr. SALMON. Without objection. 

Mr. LOWENTHAL. What I would like to ask Mr. Russel and, also, 

Mr. Stivers, if he wants to, is: How do you see the international 

Green Climate Fund helping to invest in sustainable development 

in East Asia that will result in what the Department of Defense 

calls reducing the threat multiplier of climate change? How do you 

see this helping? And how else is U.S. foreign assistance supporting Asian and Pacific nations’ efforts to deal with climate 

change? 

Mr. RUSSEL. Well, thank you very much, Congressman 

Lowenthal. I will speak to the first part of your question and then 

defer to Mr. Stivers. 

First of all, thank you. Thank you and your colleagues for the 

support that you have extended to the President’s Green Climate 

Fund initiative. We think that it addresses directly one of the 

world’s greatest challenges and the East Asia and Pacific region in 

particular. 

Given the vulnerability—the huge vulnerability of the region to 

the effects of climate change, global warming, and rising sea levels, 

as well as the impact on fish stocks and sustainable food security, 

we are determined and committed to get at this problem. 

No one has been more active and vigorous than Secretary Kerry. 

And advancing the efforts to deal with and mitigate the effects of 

climate change are major parts of our Asia-Pacific strategy. 

Last November President Obama announced a $3 billion pledge 

for the Green Climate Fund and the U.S. commitment to reduce 

carbon pollution. He has worked, as you know, last year to also induce the Chinese to follow suit with strong commitments for carbon 

emission reduction. 

And he has also elicited tremendous support from partner countries, most notably from Japan, whose prime minister will be here 

this weekend and has pledged $11⁄2 billion to the Green Climate 

Fund. Our work with Asian countries on climate is an example of 

what I would call the rebalance going global. 

But for the specifics—Jon. 

31

Mr. STIVERS. Thank you, Mr. Lowenthal, for that question and 

for your leadership on climate change issues. 

Climate change is affecting the people of the East Asia-Pacific region. In support of the President’s Global Climate Change Initiative, we are helping with cleaner energy sources, adaptation and 

sustainable land practices, and disaster resilience. 

In the Mekong Delta, 1 meter of sea level rise will inundate 40 

percent of the land where 18 million people live. I was just there 

a few weeks ago to see what USAID is doing. And we are helping 

farmers adapt to increased salinization of the rivers, droughts, and 

with new farming techniques for salt-resistant crops for local communities, and to raise their awareness for best practice as they 

deal with these issues. 

And so USAID has a number of initiatives in many countries in 

East Asia-Pacific, which is extremely vulnerable to climate change. 

Mr. LOWENTHAL. Thank you. 

I don’t know if I am going to get a chance to have you answer 

this, but I just want to put it out on the record. 

This year marks 20 years since the United States normalized relations with Vietnam. We have increased in recent years our engagement with Vietnam on trade and the TPP negotiations, as well 

as shared security interests. 

My question is: Has the United States’ engagement and assistance to Vietnam further respect—has it furthered respect for 

human rights and dignity? 

I personally believe Vietnam has done little to improve its 

human rights record in recent years and continues to jail those who 

have spoken out. Bloggers, labor activists, religious leaders, all 

have been imprisoned. 

And talking about labor, you mentioned, Mr. Russel, about improvement in labor relations. Well, Vietnam has one union, the 

Communist Party, and denies all other unions the ability to exist. 

It still does. 

How is the TPP going to help that? 

Mr. RUSSEL. Thank you very much, Congressman. 

Briefly, the answer to your question is yes. Our comprehensive 

partnership and our engagement with the Vietnamese, in the first 

instance, has led to some milestones on what will still be a long 

road toward legal reform. 

Vietnam ratified the U.N. Convention Against Torture, the U.N. 

Convention on the Rights of Persons with Disabilities. They have 

committed to and we are keeping score on their progress on institutional reforms, including revision of the Criminal Code, and that is 

something that we are supporting. 

With respect to the TPP, I am convinced that we would not be 

seeing nearly the progress that we do see, including on labor, were 

it not for the promise of the economic benefits that come from free 

trade with the United States and the other members. 

What we are seeing are commitments that are enforceable, with 

sanction provisions, as in any trade agreement, for noncompliance 

on labor. We are seeing significant changes in the climate, including bringing steps to bring Vietnam up to International Labor Organization standards, which is a prerequisite for membership in 

TPP. We are working and will work to develop the capacity, and 

32

we will work to ensure that there are proper enforcement mechanisms in place. That is for labor. 

I think it is also important, even though Congressman Sherman 

has left, to say that, on environment, the TPP Agreement, even if 

it didn’t have a single trade provision, would be the best and 

strongest environmental agreement that the U.S. has ever entered 

into. And for a country like Vietnam, with problems of wildlife trafficking and overfishing, illegal logging, that is hugely important. 

Mr. SALMON. Mr. Russel, I am going to give you another chance. 

His time has expired, but I am going to give you another chance 

on the TPP when it gets to a second round of questions because I 

know you have got a lot of burning things inside you want to get 

out of there. So we will give you another chance. 

I will turn the time over to Mr. Rohrabacher. 

Mr. ROHRABACHER. Okay. Thank you very much. 

And let me just note that, when you base decisions on nonsense, 

it shouldn’t be surprising to anybody that we come up with bizarre 

policy advocacy. 

It is bizarre for me to sit here and listen to people talk about financing in the millions of dollars—American tax dollars an environmental program on the mainland of China, which, of course, is 

the world’s worst human rights abuser and a country that is right 

now taking ever more aggressive stands, for example, the declarations of—territorial declarations, alone—what China has been saying in the South China Sea and in the shipping lanes that would 

strangle Korea and strangle Japan. 

For us to be talking, ‘‘Oh, well, the environment is going to let 

us work together with these guys,’’ that is such utter nonsense, especially giving American dollars to their project in China. We’ll let 

the American people decide what is absurd and what isn’t. 

Let me note, when the Chinese started building these islands out 

of rock piles in the ocean and then start making them—claiming 

that they are territory and, thus, gives them the right to control 

huge, vast areas of the Pacific Ocean, maybe somebody will see 

that that is an aggressive act and deserves so much outrage on our 

part that we wouldn’t be even considering providing China with 

millions of dollars for their global warming program. 

China is at this time, for example, behind Hun Sen in Cambodia. 

I mention Hun Sen. Who is Hun Sen’s greatest friend? It is Beijing. 

Who is North Korea’s best friend? Beijing. And China has a horrible relationship with gangster regimes throughout the world. 

They are robbing the people of their resources in any country that 

they are engaged in by making deals with gangster regimes that 

have no rightful role in terms of what we believe in, democracy. 

So one thing that I mentioned earlier on, the one thing to give 

us hope is that we have a new rising power in a democratic Japan 

reasserting itself as an influence in that region of the world. Japan 

can counterbalance what has been, basically, China run amuck 

with the acquiescence of America’s business community and America’s, it seems, environmentalists. 

We were told a long time ago, if we build up China’s economy, 

there would be political reform. Well, there has been no political reform. They haven’t become more modernistic in terms of the way 

33

they deal with other people’s rights. In fact, this theory that I always called the ‘‘Hug a Nazi. Make a liberal theory’’ didn’t work. 

And it is not working in Vietnam as well. In Vietnam, they do 

not have—everything you cited was fine about how they are making their economy more efficient. Well, making the economy more 

efficient for a Nazi-like regime is not something that we should be 

bragging about. We should be supporting the people of Vietnam 

against their oppressor. 

And we certainly support the people in Cambodia and elsewhere 

that are suffering under—and even as we talk we have China 

reaching an agreement with Pakistan in order to take over a port 

in the Balochistan region of Pakistan. And one wonders who is 

being bribed there. Who is being bribed to give away an important 

maritime asset in that country of Pakistan? 

So I would like to just suggest that we need to look at these matters in a much more serious tone. I’m sorry that I just can’t believe 

that, after 18 years of steady weather and steady climate and no 

big jump in the temperature, which we were promised by those 

people who believe that CO2 emissions cause increases in the temperature—I don’t buy it anymore, and most Americans don’t, especially if it is going to mean that we have to go along with giving 

money to Chinese programs. 

Thank you very much. I have got to go. Please feel free to say 

everything bad about what I just said. I have got to be on the floor. 

Mr. STIVERS. Just real quick, Mr. Rohrabacher, I just want to assure you that we provide no assistance to China on the environment. The example I was using was in Vietnam. 

I have shared many of your concerns about China from my time 

working almost 18 years for Ms. Pelosi. And so I have been fortunate to work alongside you and your staff on a lot of these issues. 

But I can assure you there is no environmental assistance we 

provide in China except for a little bit on the Tibetan Plateau that 

helps the Tibetans, but none that benefits China. 

Mr. ROHRABACHER. Thank you very much. 

Mr. SALMON. Mr. Russel, did you want to make a comment? 

Mr. RUSSEL. Yes. Very briefly, if I may, Mr. Chairman, in response——

Mr. ROHRABACHER. I’ve got to run off. I have a speech on the 

floor. 

Mr. SALMON. I will pass it on to him. 

Mr. RUSSEL. Japan is indeed our great ally and great friend. We 

are honored to welcome a visit of the Japanese Prime Minister to 

Washington and thankful and grateful that the Congress will host 

him for a speech. 

Our partnership and our security alliance with Japan is a major 

element, in fact, the cornerstone of our regional security policy and, 

indeed, our rebalance. And Secretary Kerry, along with Secretary 

Carter, will be announcing the details of our revised defense guidelines on Monday in New York, and this will represent a very major 

milestone in increased Japanese contributions to the South China 

Sea and China. I would be prepared to address that, if you wish. 

Mr. SALMON. That would be great. 

I do have a couple of other questions I would like to—and maybe 

you can weave it in. But I just wanted to—Mr. Sherman asked you 

34

about the involvement of Taiwan in INTERPOL and asked you if 

you were supportive, and you did say that you are supportive of 

Taiwan doing that. 

Could we get a commitment of support from State for—for the 

legislation that would do that? 

Mr. RUSSEL. Mr. Chairman, I won’t speak to the legislation itself. 

Please allow me to consult with my colleagues and review——

Mr. SALMON. That will be fine. In fact, I don’t expect you to have 

read it by now. 

But barring the fact that it does what it says we are doing and 

it is in concert with what you said your position is as far as Taiwan 

participating, we are hoping that you will support it and hoping 

that you will get back to us because we are hoping that we can get 

it marked up and passed through this Congress and on the President’s desk and get it signed and start moving. 

The second thing I wanted to ask—and then at the very—my last 

question is going to be to just give you an opportunity to expound 

a little bit more on TPP. Mr. Sherman raised a lot of concerns 

about TPP and its economic benefit to the United States, to individuals, jobs here in the United States. 

And he also mentioned that his fear was that, in Vietnam, they 

could actually make the product in China, send it to Vietnam, slap 

a Vietnamese label on, so the country of origin doesn’t really matter. I would love you to address that, too, if you can. 

But before that—and I am just going to give you the microphone 

and let you say whatever you want about TPP. You do your best. 

But my other question is about the Asian Infrastructure Investment Bank. And many of our allies have joined that. Australia just 

recently said that they are going to join. In fact, really, the only 

significant holdout is Japan, who is, I think, trying to be a good 

friend and partner of the United States. 

What is our strategy on that going forward? It doesn’t seem like 

continuing to oppose that is going to be of much value. 

Do we have a Plan B as far as how to work with them and make 

sure that the World Bank and the IMF work in concert with what 

they are trying to do for the region, that we are looking out for the 

United States’ interests? So that is my question. And then you 

have at it with TPP. 

Mr. RUSSEL. Thank you very much, Mr. Chairman. 

My brief comment on South China Sea in response, first, to Congressman Rohrabacher’s point is simply this: He mentioned rocks. 

He mentioned sand. The issue isn’t about rocks. It is about rules. 

The issue isn’t about sand. It is behavior. 

And the United States has for going on seven decades been the 

guarantor of the security in the Asia-Pacific region that has enabled not only our economic growth, but the growth of the countries in the region, including China. 

And that is the responsibility that we will not abrogate. We will 

take the measures necessary to preserve that and freedom of navigation and mitigate the risk of coercion against our treaty allies. 

Mr. SALMON. I am so glad you brought that. I support that 100 

percent. 

Mr. RUSSEL. Mr. Chairman, our strategy vis-a`-vis AIIB is to use 

direct persuasion with the Chinese, consultations with friends and 

35

partners, and the elements of the multilateral development and 

other banking systems to try to ensure that the AIIB evolves into 

a high-quality, transparent, responsible actor that functions in tandem with multilateral development banks and by the same standards that have been developed for multilateral development banks. 

It is, I believe, telling that so many major economies held back 

on a decision to join the AIIB as a founding member until they 

were satisfied that, number one, the elements in the articles of 

agreement would be, from their point of view, minimally sufficient 

to warrant joining, and, second, until they became convinced that, 

by joining, they would be able to exert influence from within that 

would help bring the AIIB to a level of governance, of transparency, of standards, of oversight that they consider to be on par 

with other multilateral development banks. 

Our strategy, Mr. Chairman, is to use those other banks like the 

Asian Development Bank, like the World Bank, in which we have 

a tremendous leadership role and a long history and a lot of money 

invested to partner with the AIIB in an effort to address what is, 

in fact, a genuine need, a need for infrastructure investment in the 

Asia-Pacific region. We are insistent, however, that that investment should be responsible. It should have appropriate safeguards 

in terms of debt sustainability and environment and so on. 

So the canard that we somehow sought to block the development 

of a new bank is misguided, but the fact that we are determined 

and committed to help ensure that China and the other founding 

members caused that bank to operate at international standards is 

absolutely right. And Japan is an important partner with us in 

that effort. 

With regard to TPP, first and foremost, although I am not a 

trade expert, I know that the safeguards to prevent back-door entry 

to products from non-TPP countries is a central element of the design of the rules pertaining to rules of origin, and that is—that is 

a principle that has suffused the design and the negotiations of 

TPP. 

More broadly—and it is perhaps precisely because I don’t come 

from the trade world—what is so striking and so valuable about 

TPP is, number one, the strategic value. This agreement is seen in 

the region, if not the world, as an example of the United States exercising leadership to establish high standards, inclusivity, and 

free markets. 

We must succeed. Our credibility, as well as our economic interests, are deeply interlinked. We are the preeminent rule-setter, and 

to set rules that will benefit both the countries of TPP and around 

the Pacific Rim growing economies and the United States, including and especially of the U.S. middle class, is our responsibility as 

well as our interest. 

But I mentioned other non-trade elements, including environment. But there are more. There are very fundamental good governance provisions in the TPP agreement that go to the heart of 

our collective concerns about the Vietnamese Government, for example, and about the kind of rules-based system that we want to 

see prevail in the Asia-Pacific region. 

The agreement has anticorruption provisions and dispute settlement mechanisms that are entirely consistent with American valVerDate 0ct 09 2002 11:01 Jun 24, 2015 Jkt 000000 PO 00000 Frm 00039 Fmt 6633 Sfmt 6633 F:\WORK\_AP\042315\94310 SHIRL
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ues and American procedures. I mentioned labor standards with 

built-in enforcement mechanisms. 

And the digital economy, which is the new frontier, is another 

area in which TPP contains meaningful protections to intellectual 

property at the same time that it promotes freedom of information 

and cross-border migration of data and electronic information. 

It also has a chapter on development, which I know Mr. Stivers 

can speak to. This is a first-ever development chapter in a trade 

agreement, and it will help promote broad-based economic growth. 

The last thing I would mention—I’m sorry to go on long—is that 

the agreement also focuses very heavily on small- and mediumsized enterprises. That is part and parcel of the advantages that 

it offers to the United States and to working men and women here. 

It is also of tremendous advantage in the region in terms of promoting microenterprise, worker participation, access to the global 

economy, and the flourishing of nongovernmental organizations. 

Mr. SALMON. I am going to ask one last question and then let 

you guys wrap up. And I really appreciate you taking the time 

today. But I spoke last night before a group of stakeholders in the 

region, and these are the questions I was asked. And so I want to 

throw them out to you, too, and they are along the lines of TPP. 

Do we expect or anticipate a second round of TPP? And along 

with that, do we expect that China will later want to participate 

with TPP? And what is the likelihood that Taiwan would be included in a second round of TPP? 

Mr. RUSSEL. I don’t want to walk too far out onto the thin ice 

of speculating on policy and trade matters, Mr. Chairman, particularly at a moment when the TPP negotiations are going on hot and 

heavy. 

However, I will take a few tentative steps in saying first that the 

line of important economies and countries, a line that includes 

countries like the Republic of Korea and a line that very clearly includes Taiwan, is starting to snake around the corner, so to speak. 

There is a tremendous interest in joining TPP. I think that is a 

healthy sign. And I at the same time will accept the caution by my 

friend and colleague and master, Mike Froman, that he needs to 

concentrate on first things first. Job number one is to close the 

agreement. 

The question of China is something that is widely discussed. I 

think that the way to look at it is this: The world would be a better 

place if China were in a position to meet the requirements on 

trade, on openness, on protection of intellectual property, on environment, on labor standards, that are requirements for membership in TPP. So the short answer is we should be so lucky. 

Mr. SALMON. I am going to get the transcripts of what you just 

said and carry that in my pocket with me because I think that was 

a really great answer. I really appreciate you taking the time. 

Mr. Stivers, did you have any final comments that you wanted 

to make? 

I really appreciate you both taking the time to come and testify 

before us today. 

And, without objection, this hearing is now adjourned. 

[Whereupon, at 2:15 p.m., the subcommittee was adjourned.] 

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