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ASSESSING U.S. FOREIGN POLICY PRIORITIES AND

NEEDS AMIDST ECONOMIC CHALLENGES IN

THE MIDDLE EAST

HEARING

BEFORE THE

SUBCOMMITTEE ON 

THE MIDDLE EAST AND SOUTH ASIA

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED TWELFTH CONGRESS

FIRST SESSION

MARCH 10, 2011

Serial No. 112–34

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 

ILEANA ROS-LEHTINEN, Florida, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

DAN BURTON, Indiana 

ELTON GALLEGLY, California 

DANA ROHRABACHER, California 

DONALD A. MANZULLO, Illinois 

EDWARD R. ROYCE, California 

STEVE CHABOT, Ohio 

RON PAUL, Texas 

MIKE PENCE, Indiana 

JOE WILSON, South Carolina 

CONNIE MACK, Florida 

JEFF FORTENBERRY, Nebraska 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

GUS M. BILIRAKIS, Florida 

JEAN SCHMIDT, Ohio 

BILL JOHNSON, Ohio 

DAVID RIVERA, Florida 

MIKE KELLY, Pennsylvania 

TIM GRIFFIN, Arkansas 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

ANN MARIE BUERKLE, New York 

RENEE ELLMERS, North Carolina 

VACANT 

HOWARD L. BERMAN, California 

GARY L. ACKERMAN, New York 

ENI F.H. FALEOMAVAEGA, American 

Samoa 

DONALD M. PAYNE, New Jersey 

BRAD SHERMAN, California 

ELIOT L. ENGEL, New York 

GREGORY W. MEEKS, New York 

RUSS CARNAHAN, Missouri 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

DENNIS CARDOZA, California 

BEN CHANDLER, Kentucky 

BRIAN HIGGINS, New York 

ALLYSON SCHWARTZ, Pennsylvania 

CHRISTOPHER S. MURPHY, Connecticut 

FREDERICA WILSON, Florida 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

YLEEM D.S. POBLETE, Staff Director 

RICHARD J. KESSLER, Democratic Staff Director 

SUBCOMMITTEE ON THE MIDDLE EAST AND SOUTH ASIA

STEVE CHABOT, Ohio, Chairman 

MIKE PENCE, Indiana 

JOE WILSON, South Carolina 

JEFF FORTENBERRY, Nebraska 

ANN MARIE BUERKLE, New York 

RENEE ELLMERS, North Carolina 

DANA ROHRABACHER, California 

DONALD A. MANZULLO, Illinois 

CONNIE MACK, Florida 

MICHAEL T. MCCAUL, Texas 

GUS M. BILIRAKIS, Florida 

TOM MARINO, Pennsylvania 

GARY L. ACKERMAN, New York 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

DENNIS CARDOZA, California 

BEN CHANDLER, Kentucky 

BRIAN HIGGINS, New York 

ALLYSON SCHWARTZ, Pennsylvania 

CHRISTOPHER S. MURPHY, Connecticut 

WILLIAM KEATING, Massachusetts 

(III)

C O N T E N T S 

Page

WITNESSES 

The Honorable Jeffrey D. Feltman, Assistant Secretary of State for Near 

Eastern affairs, U.S. Department of State ......................................................... 8

Mr. George A. Laudato, Administrator’s Special Assistant for the Middle 

East, U.S. Agency for International Development ............................................ 16

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

The Honorable Steve Chabot, a Representative in Congress from the State 

of Ohio, and chairman, Subcommittee on the Middle East and South Asia: 

Prepared statement .............................................................................................. 4

The Honorable Jeffrey D. Feltman: Prepared statement ..................................... 10

Mr. George A. Laudato: Prepared statement ........................................................ 18

APPENDIX 

Hearing notice .......................................................................................................... 48

Hearing minutes ...................................................................................................... 49

(1)

ASSESSING U.S. FOREIGN POLICY PRIORITIES 

AND NEEDS AMIDST ECONOMIC CHALLENGES IN THE MIDDLE EAST 

THURSDAY, MARCH 10, 2011

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON THE MIDDLE EAST

AND SOUTH ASIA,

COMMITTEE ON FOREIGN AFFAIRS, 

Washington, DC. 

The subcommittee met, pursuant to notice, at 2 o’clock p.m., in 

room 2172, Rayburn House Office Building, Hon. Steve Chabot 

(chairman of the subcommittee) presiding. 

Mr. CHABOT. The committee will come to order. 

Good afternoon. I want to welcome all my colleagues, new and 

old, to the first hearing of the Subcommittee on the Middle East 

and South Asia. 

I guess I am both a new and old member of the subcommittee, 

having served for a number of years under Chairmen Gilman and 

Ros-Lehtinen and Ackerman. And after a temporary interruption in 

service—I like to call it my 2-year involuntary sabbatical—I am 

back. 

And I want to acknowledge my friend from New York, the distinguished ranking member, Mr. Ackerman. I have enjoyed working 

with him over the years and look forward to working closely with 

him in the next couple of years and hopefully longer. 

I also want to acknowledge the vice chairman of the subcommittee, my friend from Indiana, Mr. Pence. I look forward to 

working with him, as well. 

And, finally, I would like to welcome our freshman members, 

who will hopefully be here soon: Mr. Marino, Ms. Buerkle, Ms. 

Ellmers, and Mr. Keating. I hope that they enjoy serving on the 

subcommittee. 

And I would expect that this subcommittee will continue to work 

in a bipartisan manner as often as possible. We will certainly disagree on issues from time to time, but we will also find many 

areas, I am certain, where we can work together. I can assure you 

that I will try to operate the subcommittee in a collegial manner. 

And I know Mr. Ackerman, Chairman Ackerman at the time, did 

that at the time over the years. 

And this hearing was called with the intention of following up on 

Secretary of State Clinton’s testimony that the full committee 

heard last week, but with an exclusive focus on the Middle East. 

This will give members the opportunity to ask more specific quesVerDate 0ct 09 2002 13:43 Jul 13, 2011 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 F:\WORK\MESA\031011\65055 HFA PsN: SHIRL
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tions, both about the Fiscal Year 2012 proposed budget as well as 

broader U.S. strategy throughout the region. 

The regional shifts happening right now in the Middle East place 

the United States and our allies at a precipice in history. The entire strategic framework that the United States regional posture 

has been based on for decades is rapidly transforming. The precise 

new composition of the region remains uncertain. At a minimum, 

it will be shifting from autocracies of varying degrees to political 

diversity. 

At this critical juncture, the administration must seize the initiative to cement new partnerships and secure enduring U.S. strategic 

interests, such as countering terrorism, securing energy supplies 

for global markets, countering proliferation, moving forward on the 

Israeli-Palestinian peace process, and guarding against the threats 

posed by Iran and Syria. These objectives can only be achieved by 

helping to establish the foundations and principles for a new strategic order in the region. 

For decades, the United States has been criticized throughout 

the Middle East for what was perceived to be an unprincipled foreign policy. Today, we have the opportunity to prove wrong those 

who hold this belief. But that can only be achieved with action. We 

must not miss this opportunity. 

It is safe to say that there are many learning opportunities to be 

had. It is particularly thought-provoking to consider the reforms 

President Obama called for in his Cairo speech. Many of the measures laid out in the speech resonated with citizens throughout the 

region. 

Unfortunately, many of those measures were never implemented. 

What, if over the past few years, we had more effectively lobbied 

our allies in the region, many of whom are large aid recipients, to 

implement political reforms? Could we have had liberalization 

without the violence and bloodshed that we see now? 

No one can know the answers to those questions for sure, but 

they highlight one undeniable truth: Money is no substitute for effective diplomacy. 

I think we can look at the Middle East today with cautious optimism. We can certainly be inspired by the brave actions taken by 

pro-democracy activists who seek merely to have the same fundamental human rights that are the birthright of every individual on 

Earth. We know now that the claims of many in the past that the 

Middle East is somehow not ready for democracy are fundamentally false. We are reminded that the rights to life, liberty, and the 

pursuit of happiness do not stop at the water’s edge. 

With this in mind, I think we can look to the future with hope—

hope that we see emerge in this region true representative government, a government that embodies key principles of a democratic 

society, such as the right to vote and the right to free expression, 

and that these principles are applied fairly across ethnic and religious lines. 

At the same time, we have to be concerned that the efforts of so 

many may be hijacked by extremists who seek to use the institutions of democracy to rise to power, only to abolish that very system. Although it is the right of the people of the Middle East ultiVerDate 0ct 09 2002 13:43 Jul 13, 2011 Jkt 000000 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 F:\WORK\MESA\031011\65055 HFA PsN: SHIRL
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mately to self-determine their own fate, we should be ready to assist them in their effort. 

As I mentioned earlier, although the circumstances in the region 

are changing, our core interests are not. And our mission is, without a doubt, daunting. The budget that this Congress is considering 

is the means of meeting these challenges. 

To that end, we will hear today from Ambassador Feltman and 

Mr. Laudato on what those plans are and how the budget allocations they have requested will enable them to achieve them. I want 

to thank them both for taking the time to meet with us today. 

And I would now recognize the ranking member, Mr. Ackerman, 

for his opening statement. The gentleman is recognized. 

[The prepared statement of Mr. Chabot follows:]

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

Let me first congratulate you on this, your first day and first 

hearing——

Mr. CHABOT. Thank you. 

Mr. ACKERMAN [continuing]. Of this subcommittee in this Congress, and tell you that we look forward to working with you in a 

nonpartisan fashion in the interest of our country. We see many 

issues eye-to-eye, and you and I have gotten along famously in previous Congresses. And I look forward to that continuing, despite 

the fact that you are in the chair. 

Mr. CHABOT. Thank you. 

Mr. ACKERMAN. Mr. Chairman, although there is a lot of ground 

to cover in this hearing, focusing on the Middle East as a whole, 

I would like to focus chiefly on Egypt. First of all, I think what 

happens in Egypt is absolutely critical and may determine the future of the entire region; and, second, because, to my deep regret, 

the Obama administration now appears to be on the verge of a colossal and inexcusable failure to seize this critical moment. 

So, you have a close friend. She has been very reliable and helpful to you, and she is very important in the neighborhood. After a 

30-year marriage, she finally throws her good-for-nothing husband 

out of the house. As you well know, he continuously beat her, 

abused their children, and frittered away their scarce resources. 


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Now, imagine, a few days after pushing the old man out, your 

helpful and reliable friend calls you and asks you for help. And in 

response to your good, reliable, and helpful friend, you jam your 

hands into your pockets, pull out a stick of gum and a used 

ChapStick and 150 bucks, and say, ‘‘Don’t spend it all at once.’’

And as you walk away, you add, ‘‘Do you remember the three 

grand you guys borrowed so you could feed your kids? Well, make 

sure you get me about 300 bucks back this year. I am having a 

tough time, too.’’

I think we would consider someone who responded that way to 

be a rather sorry excuse for a human being, much less a friend. 

But this is almost exactly what the Obama administration is doing. 

And it is worse than a sin; it is a mistake. We will not get another 

chance to help Egypt in this critical and formative moment in its 

history. 

And let’s be clear about the scale: If things go bad in Egypt, the 

consequences for the Middle East and for the United States will 

make the Islamic revolution in Iran look like an episode of Sesame 

Street. 

What has to be borne in mind is that this revolution in Egypt 

is shaped like a hurricane, and right now we are in the eye of the 

storm. Things seem kind of quiet. In reality, the back end of the 

storm is coming. And in a few short months, when expectations 

come crashing into reality, the great mass of Egyptians are going 

to discover that they are still impoverished with yet-unfulfilled 

dreams, and they are going to take to the streets again. 

And this time they won’t just be asking for democracy and their 

God-given rights. The vanguard of this second revolution won’t be 

bright-eyed, secular, Twittering youngsters. It will be the Muslim 

Brotherhood, who are shrewdly hanging back right now and waiting for Egypt’s neo-nascent democratic experiment to arrive stillborn. 

But instead of moving aggressively to lift a $3 billion burden off of Egypt’s back, a debt that will cost them roughly $315 million 

this year and for many years to come, the administration has proposed reprogramming $150 billion so that USAID aid could support 

‘‘nongovernment organizations supporting the Egyptian-led economic and citizen-led transition effort’’—in other words, exactly the 

same kind of inconsequential programs that USAID has been doing 

for the past several decades. It is a big box with the same old mush 

and a great big ‘‘new and improved’’ sticker slapped on it, the same 

great mush, now even more feckless. 

USAID has proposed spending 75 million bucks on three new 

economic growth programs that will include ‘‘secular-based dialogues for local businesses to encourage local, regional, national, 

and international trade expansion; and improving the skills and access to finance of entrepreneurs, enterprises, and businessowners.’’ 

This bureaucratic mumbo-jumbo sounds to me like a bunch of seminars in a Holiday Inn. It is the commercial, ‘‘I am not really a global power, but I did stay last night at a Holiday Inn.’’

Egypt has 80 million people and a $500 billion economy. USAID 

is proposing a bottle of aspirin for a man who needs a heart transplant. Debt relief, by comparison, is big, is fast, is meaningful, and 

it leverages America’s standing as a global leader and a diplomatic 

7

powerhouse. American support for debt relief could help encourage 

European support for debt relief, something the Egyptians are already seeking, to the tune from the Europeans of some $9 billion. 

The Egyptian Government’s total foreign debt is roughly $30 billion. 

Instead of us playing small ball at the Holiday Inn, leading a 

global effort to eliminate the debt accrued by Mubarak’s Egypt 

would show real commitment and real friendship. Debt relief could 

help leverage Egyptian reform efforts and be done before the back 

of the hurricane hits, without the bureaucratic delay and parasitic 

contractors that so regularly plague even USAID’s debt efforts. 

Debt relief requires no new outlays from the U.S. Treasury. And, 

best of all, debt relief empowers Egyptians to chart a new course 

for their country on their own terms, which was the point of their 

revolution in the first place. 

I am told that both Treasury Secretary Geithner and Under Secretary of State Burns have been talking down American debt relief 

for Egypt. I have a lot of respect for each of these men, but if, in 

fact, they are pushing debt relief off the table, I think they are 

making an incredibly shortsighted and potentially catastrophic 

error. 

And, finally, a quick word each about Lebanon and Syria. I have 

said before that our assistance to Lebanon needs to be put on hold 

until the new government takes shape and demonstrates that it intends to pursue the interests of Lebanon—not Iran, not Syria, and 

not Hezbollah. The burden rests with the next Lebanese Government. If terrorists put you in power, you have to show, not simply 

declare, that you are independent from them. 

And regarding Syria, I have one simple question: Is our policy 

‘‘passive consistency’’ or ‘‘consistent passivity’’? Or don’t we have 

any Syria policy at all? I am glad Ambassador Ford is in Damascus. I just wish he was doing more than conveying the usual feckless message to the Syrians and reporting their contempt back to 

Washington. 

I thank you, Mr. Chairman, and I look forward to hearing from 

our two very distinguished witnesses. 

Mr. CHABOT. Thank you very much, Mr. Ackerman. 

Any other folks want to say anything particularly pressing? 

Okay. We will go ahead and introduce our panel here, our very 

distinguished panel here this afternoon. 

We will start with Ambassador Jeffrey Feltman. Ambassador 

Feltman was sworn in as Assistant Secretary of State for Near 

Eastern affairs on August 18, 2009. He is a career member of the 

Foreign Service since 1986. Ambassador Feltman served as Principal Deputy Assistant Secretary in the Bureau of Near Eastern Affairs from February 2008 to his present assignment, serving concurrently as Acting Assistant Secretary of State for the Bureau 

since December 2008. 

From July 2004 to January 2008, Ambassador Feltman served as 

U.S. Ambassador to the Republic of Lebanon. Prior to his assignment in Lebanon, he headed the Coalition Provisional Authority’s 

office in the Irbil province of Iraq, serving simultaneously as deputy regional coordinator for the CPA’s northern area. 

8

And it goes on and on. It is a very long and distinguished bio. 

But rather than continue with that, I am going to go over to Mr. 

Laudato’s here quickly, and then we will hear your testimony. 

George Laudato leads the Middle Eastern Bureau as the Administrator’s Special Assistant for the Middle East at the U.S. Agency 

for International Development (USAID). He has more than 45 

years of experience in international program development and 

management in the private and public sectors in Asia and the Middle East, Latin America, and Central Europe. 

And this one goes on and on, as well. But rather than take the 

time to do that, since we really want to get to your testimony here 

this afternoon, we will go right to the testimony now. And members 

then can follow up with questions. 

We will begin with you, Ambassador Feltman. 

And each of you has 5 minutes, by the way. 

STATEMENT OF THE HONORABLE JEFFREY D. FELTMAN, ASSISTANT SECRETARY OF STATE FOR NEAR EASTERN AFFAIRS, U.S. DEPARTMENT OF STATE 

Ambassador FELTMAN. Mr. Chairman, Ranking Member Ackerman, distinguished members of the committee, thank you very 

much for inviting me and for inviting George Laudato to testify before you in your first hearing in the new session. So thank you very 

much. 

We look forward to testifying regarding our Nation’s foreign policy priorities in the Middle East at this critical time, as both you 

and the ranking member mentioned. 

Transitions in Egypt and Tunisia, the tragic violence unfolding 

in Libya, and unrest in Yemen and elsewhere are indicative of larger forces at work across the region, including unprecedented mass 

movements calling for democratic change. 

Notably, the genesis of these momentous events has not been 

anti-American or anti-Israeli or anti-Western. Rather, they are inspired by domestic grievances and legitimate aspirations for certain 

rights and opportunities that we, as Americans, have long recognized as universal. 

The outcomes of the political changes under way in the region 

are still taking shape. While these changes are different in each 

country of the region, they are playing out against a backdrop of 

shared challenges. Daunting demographic, political, economic, and 

environmental challenges compound each other. 

And we know a strong and strategic response will be required 

from the United States if we are to adequately protect our interests, promote our values, and advance our security in this crucial 

region. 

We have much at stake. Successful democratic reforms in the 

Middle East would lay the groundwork for a more sustainable regional foundation. Peaceful changes that answer people’s legitimate 

aspirations and respect their rights would give the lie to al Qaeda 

and all of those who claim that violence and extremism are the 

only means for achieving results. 

We are seeking to act as partners, to governments as well as peoples and civil society, to help counter acute threats, to resolve conflicts, and to build the stronger democratic foundation that will enVerDate 0ct 09 2002 13:43 Jul 13, 2011 Jkt 000000 PO 00000 Frm 00012 Fmt 6633 Sfmt 6633 F:\WORK\MESA\031011\65055 HFA PsN: SHIRL
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able our friends to meet the challenges and seize the opportunities 

they face. 

This is the road to long-term stability and broad-based economic 

opportunity—ingredients that are essential to make the region 

more secure and more friendly to American interests. And it is the 

work that the State Department, USAID, and our interagency colleagues are engaging in every day, working to help shape events 

and address contingencies that could have a critical impact on our 

national security. 

It is worth noting that the price tag of these diplomatic and development efforts is far smaller than if we were forced to defend 

our interests through military force. 

We stand for a set of core principles. We strongly condemn any 

violence directed against peaceful citizens. Governments must respond to their people peacefully through engagement and meaningful reforms. And we stand for the rights of all men and women, regardless of age or minority status. 

As you well know, the United States has other important core interests in this region in addition to promoting democracy and 

human rights: Halting Iran’s illicit nuclear activities; ensuring lasting security for Israel; achieving a comprehensive peace between 

Israel and its neighbors based on a two-state solution; supporting 

a sovereign, stable, and self-reliant Iraq; countering terrorist 

groups; and maintaining open energy, trade, and communications 

flows. These all have significant effects on our interests today and 

into the future. 

U.S. foreign assistance is applied toward advancing our national 

interest, to strengthening our friends and allies, and to helping to 

build the capacity and will to tackle shared problems. Approximately 85 percent of our fiscal 2012 foreign assistance request consists of bilateral assistance to critical partners in Israel, Egypt, and 

Jordan, as well as to the Palestinians. 

The more than $3 billion provided to Israel is the largest sum 

and, in tandem with our policy of guaranteeing Israel’s qualitative 

military edge, ensures that Israel is able to meet any combination 

of threats it might face. 

Our assistance to Egypt was invaluable in maintaining our relationship with Egypt’s military and civil society during the recent 

events there. And these relationships will remain critical in helping 

Egypt remain on a positive trajectory as Egyptians seek to consolidate their historic gains and implement essential democratic reforms. 

In this tight fiscal environment, we are mindful we need to make 

sure that every foreign assistance dollar is well-spent in service of 

our national interest. 

I look toward to discussing with you some of the specific issues 

that I address more fully in my written testimony, and I look forward to your questions. 

[The prepared statement of Ambassador Feltman follows:]

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Mr. CHABOT. Thank you very much, Ambassador. 

Mr. Laudato, you are recognized for 5 minutes. 

STATEMENT OF MR. GEORGE A. LAUDATO, ADMINISTRATOR’S 

SPECIAL ASSISTANT FOR THE MIDDLE EAST, U.S. AGENCY 

FOR INTERNATIONAL DEVELOPMENT 

Mr. LAUDATO. Thank you, Chairman Chabot, Ranking Member 

Ackerman, distinguished members of the committee. It is a pleasure to be here today to testify alongside my colleague, Ambassador 

Feltman, on assessing U.S. foreign policy priorities and needs in 

the Middle East. 

I appreciate the opportunity to address the critical points you 

raised in your request for this hearing, notably how our budget request advances U.S. interests in the region. USAID will focus on 

ways to help the people of the Middle East move toward democracy 

and improve their economic circumstance. We are doing so with regard to immediate needs and to long-term development challenges. 

As you know, Mr. Chairman, USAID operates in seven countries 

and two regional programs in the Middle East and North Africa. 

These programs are tailored to the needs of each country, yet they 

share a common structure: Promoting economic growth and good 

governance while strengthening education and health care. 

The Middle East is beset by complex problems, many of which 

have fed the current situation: A youth bulge, a rapidly growing 

population, unemployment, rising food and oil prices, and violent 

extremism. These factors contribute to the historic events of recent 

months, with people loudly demanding basic rights that have long 

been absent. 

The current Fiscal Year 2010 USAID budget provides $1.7 billion 

in assistance across the Middle East and North Africa, including 

Iraq. USAID’s Fiscal Year 2012 request for the Middle East is 

nearly $1.6 billion. While this budget reflects conditions from an 

earlier time, we are confident that we can adopt ongoing programs 

to meet the extraordinary opportunity that the transition represents. 

Given this historic situation, we plan to draw upon the skills and 

resources across the U.S. Government. We will respond to the immediate needs of the people of the Middle East, and we will keep 

our sights on what is needed to sustain progress in the long term. 

Right now we are dealing with the immediate transition situation. In the aftermath of the protests in Tunisia, USAID mobilized 

immediate humanitarian assistance to meet the urgent needs of 

those most impacted by the violence and dislocation. U.S. humanitarian assistance teams are currently on the Libyan borders in 

both Egypt and Tunisia addressing urgent needs and assessing future requirements. 

With regard to the economic conditions in the region, we are continuing to plan for the long term. At this remarkable moment in 

history, USAID recognizes that economic issues have an impact on 

future regional stability, and our Fiscal Year 2012 budget request 

reflects this. 

For instance, in Yemen, which suffers from soaring unemployment and a population of disenchanted youth, as part of the $68.5 

million request we are expanding vocational education for these 

17

youth, establishing apprenticeship programs, and helping provide 

business development services to the small- and medium-scale industrial sector. 

Egypt has received significant economic assistance since 1975, 

which helped it to grow from a low-income country to one of the 

most improved and diversified economies in the Middle East. 

USAID’s assistance directly and fundamentally contributed to improving the quality of life for Egyptian citizens. 

As a first step to ensure that Egypt’s gains continue, it is vital 

that the economy remain stable. USAID is planning to use reprogrammed funds to launch a $150 million package to assist with immediate transition needs in economic growth and good governance. 

These reprogrammed funds will complement the $250 million in 

the Fiscal Year 2010 request level, which focuses on longer-term 

goals by adopting ongoing programs to respond to new opportunities. 

Moving toward democracy: We recognize the impact of the protests on political reform and citizens’ participation. As democratic 

forces of change are sweeping the region, we are now entering a 

new phase. USAID’s programs will remain flexible enough to adopt 

to the rapid changes in the region. The opportunity for political reform is unprecedented, and we are ready to support this historic 

shift. 

Mr. Chairman, with all of these changes, it is appropriate to ask, 

where do we go from here? We are reviewing country programs to 

identify opportunities to support transportational change——

Mr. CHABOT. If the gentleman could wrap up. You are over the 

time now. 

Mr. LAUDATO. Sure. 

In conclusion, Mr. Chairman, let me just say that I appreciate 

the opportunity to share what USAID is doing to advance prosperity, democracy, and security in the Middle East. And I am eager 

to hear your advice and counsel and welcome any questions you 

may have. 

Thank you. 

[The prepared statement of Mr. Laudato follows:]

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Mr. CHABOT. Thank you very much. I am sorry to interrupt you, 

but I am trying to follow the chairwoman’s lead, in which she is 

being very strict about that, both with people testifying as well as 

members here, to keep us all on track. 

So I will recognize myself for 5 minutes, and I will keep within 

the 5 minutes. 

Ambassador Feltman, I want to ask you about the status of our 

policy toward the Israeli-Palestinian conflict. From where I sit, it 

appears that the administration has mishandled this issue from 

day one. 

The initial call for a full settlement freeze, something we could 

have anticipated would have failed, hurt our relations with both 

Israelis and Palestinians concurrently. Israelis, both government 

officials and the broader population, lost trust in us; and Palestinians viewed this as evidence that we can’t deliver. 

This administration prides itself on the use of effective diplomacy, and yet it appears that this is exactly what was missing. 

The recent episode at the U.N. Only further illustrates this end. 

After vetoing, rightfully, a Security Council resolution targeting 

Israel, Ambassador Rice’s vote explanation effectively undid any 

positive impact his veto could have had. Instead of being a steadfast defender of Israel, we appeared to be a reluctant acquaintance. 

The decision to issue such a statement is, at best, diplomatic malpractice and, at worst, abandoning our friend and ally to fend off 

the wolves alone. 

Moreover, I believe that, had we made clear to the Palestinians 

from the start that there was no way this resolution or anything 

like it would pass, they might not have proposed it. Weeks of hemming and hawing about a negotiated resolution, however, left the 

issue ineffectively addressed. Either we were 

diplomaticallyineffective or we have lost so much of our influence 

that nothing we said mattered. 

Both of these episodes and the negative repercussions that accompanied them could have been avoided, had our diplomacy been 

less inept from the start. 

This brings us to today. Months of attempts to coax the Palestinians back to the negotiating table have failed. And the absence of 

effective U.S. Leadership has left a void, which is quickly being 

filled by the threat of Palestinian unilateralism. 

As all this is happening, it is unclear what our policy is or even 

who is in charge of implementing it. George Mitchell, the special 

envoy for Middle East peace, has virtually disappeared. 

So my question is, what is our policy, and who is in charge of 

it? Additionally, what did the administration hope to achieve with 

Ambassador Rice’s vote explanation? 

Ambassador FELTMAN. Mr. Chairman, thanks. 

I think there are four main pillars to our policy toward the 

Israeli-Palestinian conflict. 

The first is an absolute commitment to Israel’s security. And the more than $3 billion that will go toward FMF for Israel, we hope, 

in the Fiscal Year 2012 budget is part of that commitment. Congress’ appropriation of $205 million for Iron Dome, a short-range 

rocket defense system from this fiscal year, Fiscal Year 2011, are 

examples of the absolute commitment to Israel’s security that this 

26

administration, like other administrations, like this Congress, have 

followed for years. That is the first pillar. 

The second pillar is, you are right, political negotiations. We 

need to get negotiations started, without conditions, with momentum behind them, to get to a two-state solution. We are not there 

yet. This is hard. We need to get there. 

The third part is the Palestinian institution-building, which is 

part of the whole two-state solution objective. The Palestinians 

need to be able to have a responsible state, not a failed state, a 

state that has law and order for its own citizens. The institutionbuilding that we are doing with the Palestinian Authority, with the 

generous support of this Congress, is also in partnership with 

Israel. 

The fourth part is a comprehensive peace, so that we are talking 

about Israel living at peace with all of its neighbors. That includes 

the Syria track and the Lebanon track. 

Those are the four main pillars of working toward a comprehensive peace in the Middle East and protection of Israel’s security. 

And, you know, this policy is led from the President on down. 

Mr. CHABOT. Okay. Thank you. 

In keeping with what I just said, I wouldn’t have time to ask my 

second question here, so I am going to yield to the gentleman. And 

if members have, in a second round, questions, we may well go to 

a second round, if folks want to stick around. 

The gentleman is recognized for 5 minutes. 

Mr. ACKERMAN. Thank you, Mr. Chairman. 

A lot of people, not just Americans and Israelis, are very concerned about whether or not Egypt is going to continue to adhere 

to its international obligations. It has, up to this point, served as 

a bulwark against radicalism and has done a lot of very, very important things. 

The army, which, under almost everybody’s scenario, will continue to somehow play a very important role in Egypt, is being 

looked at very carefully. 

And the question is, do we expect or have a concern that Egypt 

will turn to a more populist direction and a less cooperative one on 

these and other important issues as they examine foreign policy? 

And are we going to have a foreign policy there that looks more 

like Turkey’s Erdogan than Egypt’s Mubarak? 

Ambassador FELTMAN. Congressman Ackerman, I mean, the 

short answer is that none of us know for sure, you know, how the 

events in Egypt are going do develop. But what we can say is that 

we saw certain aspects of what I will call the ‘‘spirit of Tahrir 

Square’’ that are encouraging. We saw Muslims and Christians 

protecting each other in prayer. We saw people asking for a say in 

how they are governed. We saw people asking for an end to corruption. 

The sorts of things that people were asking for in Tahrir Square 

are things that could inherently make Egypt a more stable partner 

going forward, where the leadership is ruling by consent, not ruling 

by——

Mr. ACKERMAN. Yeah. We are greatly—we are more than encouraged—we are thrilled to have seen that, and it is very, very encouraging. But, in the move to a democracy, all voices somehow get 

27

heard. And there will be competitive voices in the streets as frustration sets in, because—I won’t beat you over the head with the 

point—a lousy $75 million or $150 million is not going to pull them 

out of the doldrums that they have been experiencing. I made that 

point. 

But there will be the Muslim Brotherhood that is going to be out 

there with an ‘‘I told you so’’ any minute now, playing on the frustrations of people who would like to see, as everybody else, instant 

gratification for their very good motives and expectations. 

What is going to happen then, and what are we doing about it? 

Ambassador FELTMAN. Well, first of all, the $150 million that 

you referred to, Mr. Chairman, is a quick response using existing 

resources——

Mr. ACKERMAN. I understand. I am more interested in the second 

half of my question. 

Ambassador FELTMAN [continuing]. But it is not the only thing 

that we are looking at. We are looking at what would truly help 

the transition, what would truly help the economic dislocations 

that, as you say, are severe. 

Mr. ACKERMAN. Three billion in debt forgiveness. But work on 

the other half of the question. 

Ambassador FELTMAN. What we are doing is, we are maintaining 

our partnerships with the military, with the Egyptian institutions. 

Those partnerships proved quite valuable over the past few weeks; 

they will prove valuable going forward. 

The statements that the military has made about understanding 

Egypt’s international obligations, upholding Egypt’s international 

obligations, are encouraging. We think that there is a basic understanding of the importance to Egypt of its international obligations, 

including the peace treaty with Israel. 

We are building stronger relations with civil society so that they have a better understanding of us. You know, part of the $150 million was a tool to open the door to engagement with a broader part 

of Egyptian society. We are sharing our experiences with the Egyptians about what it means to have elections that aren’t just onetime elections, that are truly democratic elections that lead to 

greater accountability and responsibility. 

This is going to be a continuing story. There is not one, sort of, 

instant way to address your question. Ultimately, the Egyptians 

themselves are going to be determining what is best for Egypt——

Mr. ACKERMAN. I got a quick question that I want to get in on 

Lebanon. The Secretary, when she was here, said that it was important that we continue our aid to the military because of their 

great importance in protecting the border and their relations with 

their neighbors. 

She noticed that the new government hasn’t been formed yet and 

said that ‘‘Once it does, we will review its composition, its policies, 

its behavior, the extent of Hezbollah’s political influence,’’ et cetera. 

That takes a long time. 

Is there a chance that the new government is going to be able 

to pursue their own foreign policy? 

Ambassador FELTMAN. All I would say, Mr. Chairman, is actions 

speak louder than words. I don’t know what they are going to say, 

but it is what they do that is going to matter. 

28

Mr. CHABOT. I thank the gentleman for his time. 

I will now recognize the gentleman from California, Mr. Rohrabacher, who is the chairman of the Subcommittee on Oversight 

and Investigations of the Foreign Affairs Committee. 

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

We are supposed to be learning things here at these hearings, so 

maybe you could educate us. If the debt of a country is forgiven, 

who is left holding the bag? 

Ambassador FELTMAN. I believe that Congress has certain rules 

for what the administration would have to do, including a formula 

for making the budget whole for that debt, based on the risk factors——

Mr. ROHRABACHER. The money that has actually been transferred, does that come from the Federal Treasury? Does it come 

from banks to which we give guarantees? So if the debt is forgiven 

from a bank, is this not, then, a gift to large bankers somewhere? 

Ambassador FELTMAN. Congressman, in general, if you talk 

about a country—I am not a financial expert, so forgive me if I am 

not getting this exactly right. But, in general, when you talk about 

a country’s debt rescheduling——

Mr. ROHRABACHER. Yes. 

Ambassador FELTMAN [continuing]. One talks about official debt 

in one category, government-to-government debt in one category, 

and commercial debt in another category. 

Mr. ROHRABACHER. Now, the government-to-government debt, 

does that come from our Treasury, or does it go through private 

banks? 

Ambassador FELTMAN. I believe it comes from our Treasury. 

Mr. ROHRABACHER. All right. I think we both need to bone up on 

that issue, right? We need to figure out what the real details are. 

And, Mr. Chairman, I am going to be studying exactly how that 

debt works. I think we should know that. 

Has the National Endowment for Democracy been mobilized and 

have they sent more people over to Egypt and to these other countries that are now going through this turmoil? 

Ambassador FELTMAN. Particularly the groups that receive funding from AID, from MEPI, as well as from NED, like IRI and NDI, 

are active in these countries. They are active across the region——

Mr. ROHRABACHER. Have they been beefed up? I know they are 

very active. 

Ambassador FELTMAN. Yes. Yes. 

Mr. ROHRABACHER. Okay. Let me just note that that is what they 

are supposed to do, that is what we expect them to do. We don’t 

want to send in troops, but we would love to send in people to help 

them organize democracy, so that elements don’t think they have 

to fight, but they can rely on ballots rather than the bullets. 

Have there been sizable street demonstrations in Iran during 

this time period, over these last 3 months? 

Ambassador FELTMAN. It is a good question, Congressman, because these events really show the hypocrisy of the Iranian regime, 

that Iran is trying to celebrate what happens in Egypt while shooting and repressing its own people. There have been demonstrations 

in Iran. They have been put down violently. 

29

Mr. ROHRABACHER. All right. And that is very important for us 

to note here, that—and anything that we do that would in any way 

encourage the Iranian regime would also be contrary to what we 

are supposedly standing for in the rest of this area, volatile area. 

I would suggest that we take note of the people here who are 

drawing our attention to the plight of the people of Camp Ashraf. 

And let us just note that, if for any reason the thousands of people 

in that camp, who are all opposition—they are opponents of the 

mullah regime in Iran, who were actively engaged in fighting the 

mullah regime—that that would be a huge disservice to those of us 

who are trying to say that we are behind the cause of democracy 

in Iran. 

You don’t have to answer that, but let’s just note that there will 

be a number of Congressmen who will be, in the next few months, 

visiting Camp Ashraf to make sure that we underscore that point. 

The people who are fighting the mullah regime are our friends. 

The people who are struggling for democracy throughout the Middle East, whatever streets they are on right now, if they really 

want democratic government, they are our friends. And we should 

be backing them up in Iran, and we should be backing them up 

elsewhere, whether it is with the National Endowment for Democracy or perhaps—and one last issue. We have 40 seconds left. 

The dictatorship in Libya over the years—which we know now, 

Qadhafi, himself, ordered the downing of an American airliner, responsible for the deaths of hundreds of Americans. His regime is 

using weapons, meant to fight military operations, against his own 

people. 

Do we plan in any way to help balance that off so that this type 

of dictator can’t use those kinds of weapons to secure his reign in 

that country? 

Ambassador FELTMAN. Do I have permission to——

Mr. CHABOT. If you can answer the question in 20 seconds or so, 

we will give you that leeway. 

Ambassador FELTMAN. Congressman, we are working with—we 

are looking at this question with the U.N., with NATO, with the 

Arab League, with the African Union, with the Gulf Cooperative 

Council, so that there is an international approach to ending the 

bloodshed and the violence that Qadhafi is inflicting on his own 

people, so that it is not unilateral, that there is a general international/regional approach. 

Mr. ROHRABACHER. Well, if we stand there when people are being 

slaughtered right in front of us, that is a message, too. It is a message to every dictator in the world that they can slaughter their 

own people, and while we can talk about it, we won’t do anything 

about it. 

Mr. CHABOT. The gentleman’s time has expired. 

Mr. ROHRABACHER. Thank you very much. 

Mr. CHABOT. I thank the gentleman. 

I would like to recognize the ranking member of the full Foreign 

Affairs Committee, Mr. Berman from California. If he would like 

to ask questions, we would certainly welcome that at this time. Or 

he could wait, whatever is his preference. 

Mr. BERMAN. I am not going to be able to wait. I really appreciate this. I apologize to my colleagues who have been here. And 

30

I will avoid comments and just ask you very quickly a couple of 

questions. 

One, is the administration going to change the restrictions that 

USAID follows on providing democracy and governance support to 

NGOs in Egypt who are not registered under the Egyptian NGO 

law? That is question one. 

You know what I am referring to here, right? I thought so. 

Secondly, Bahrain. I am curious, is there a Sunni component to 

the Bahraini opposition, or is it strictly a Sunni-Shia conflict? 

And, third, if you could just tell us a little bit about who makes 

up the Libyan National Council. What do we know about them, the 

anti-Qadhafi forces based in Benghazi? Who are their leaders? 

Thank you. 

Thank you, Mr. Chairman. 

Mr. LAUDATO. Thank you, Congressman Berman. 

Yes, we have changed our policy on NGOs. And we have recently 

requested proposals from NGOs, and we will review all of them 

equally. And registered, nonregistered, U.S., Egyptian, there will 

be no difference. 

Ambassador FELTMAN. Mr. Chairman, on Bahrain, I was there 

three times over the past couple of weeks. I go back again out there 

this weekend. 

While there are some Sunnis who are down in the roundabout, 

there are certainly some Sunni grievances about house and government services, feeling like second-class citizens. In large measure, 

it is a concessional battle between Sunni and Shia, but not exclusively so. 

And where the potential is to resolve this is a shared sense on 

both sides of Bahrain’s citizenry about the need for better government services, about the need for some real political reform. It is 

not easy, but the Crown Prince’s call for a national dialogue to lead 

to real political reform is, in our view, an opportunity. And we 

would hope that people from across Bahrain’s political spectrum 

would seize this opportunity, exercise leadership, enter into a dialogue that then has to show results. 

On Libya, you are asking a question that we are asking ourselves 

all the time. Ambassador Gene Cretz, our Ambassador to Libya, 

has, in fact, traveled to the region and traveled to Europe to meet 

with representatives of the provisional council. He has been in contact with people from the provisional council by phone. 

It is made up of some people who were formerly part of Qadhafi’s 

regime. It is made up of people who have long opposed Qadhafi’s 

regime. It is made up of a number of people. The question is, how 

deep is their political representation in the east? 

But I will tell you, we are, at this point, in contact with them, 

talking to them, as well as talking to people in the diplomatic corps 

who have left the Qadhafi regime in favor of claiming to represent 

the council. 

Mr. CHABOT. The gentleman’s time—does he yield back? 

Mr. BERMAN. Yes. 

Mr. CHABOT. The gentleman’s time has expired. Okay, thank 

you. 

Mr. McCaul of Texas is recognized next for 5 minutes. 

Mr. MCCAUL. Thank you, Mr. Chairman. 

31

I want to follow up the question from my colleague and friend 

from California. I asked Secretary Clinton the other day—you 

know, we are very vocal, very supportive of the resistance movement in Egypt and in Libya. 

But when you look at Iran—and what is happening there right 

now, I think, is very important. The former Iranian President lost 

his position just recently as head of the state clerical body, on 

Tuesday, after hardliners criticized him for trying to reach out to 

the reformers in opposition. 

Then recently, Reuters came out with a report, and also the 

Washington Institute for Near East Policy, that the IAEA report 

refers to ‘‘new information recently received, as well as concerns 

about the possible existence in Iran of activities related to the development of a nuclear payload for a missile.’’ And, you know, our 

sanctions, our diplomacy, in my judgment, are becoming a bit of a 

failed policy. And, at some point, they are going to achieve that nuclear state. 

Now, I guess that is a two-part question. But, you know, it seems 

to me, we have a great opportunity here, a golden opportunity, to 

be standing up behind this Green Movement, the resistance in 

Iran, to finally do away with the ayatollah and the mullahs, who 

have been oppressing their people for so long. And yet, when it 

comes to this administration’s policy, we are really not seeing anything. 

Can you tell me what we are doing to support—we are supporting in Egypt and Libya. What are we doing in Iran to support 

the resistance? 

Ambassador FELTMAN. Congressman, we support the right of 

peaceful assembly, wherever it is, including in Iran. What is happening in Iran is appalling. As I said, it shows the hypocrisy, it 

shows the outrageous behavior of this regime, the way that you 

have peaceful demonstrators being fired on by their own Government. And we have spoken out forcefully and strongly against that. 

Where I think you are going with your question is, how can we 

best support the Green Movement, beyond simply highlighting 

what is happening to them, highlighting the hypocrisy of the Iranian Government, the brutality of the Iranian Government? And 

there, it is more difficult. Because the Green Movement is proud 

of being an Iranian movement. They have said that they do not 

want any outside financial or technical support. They don’t want to 

be tainted, in the views of some, by looking to be agents of foreign 

government. 

So what we are trying to do is use some appropriations from this 

Congress to help create political space for them to operate via the 

Internet, to try to help provide some civil society training where 

people’s voices can get heard, provide them information that they 

would not otherwise get available, provide broadcasting into Iran 

that gives them other sources of news and information that is less 

tainted. We are trying to help create the political space for them 

to operate. 

But that is not the same as saying that we can go out and, say, 

give a bag of money to the Green Movement because, frankly, they 

don’t want it. They prefer to work in their own way, as Iranians, 

inside of Iran. So we are doing what we can on that. 

32

I agree with you very much that we have to be concerned about 

Iran’s pursuit of illicit nuclear activities. I would argue that the 

sanctions that are in place internationally, and particularly some 

of the national measures the countries have taken in response to 

the six Security Council resolutions, four of which have sanctions, 

have been significant. When you have countries like, you know, 

Australia, Japan, Norway, Switzerland, the European Union imposing national sanctions, this starts to have an impact. 

We have to watch the clock. Is the Iranian clock ticking faster 

than our sanctions clock? And——

Mr. MCCAUL. Can I just say one more thing? Because I think—

and I admire the Secretary. She is a brilliant person. But this 

President, in appearances—and I could be wrong about this, but 

the appearance is, because he thinks he can win in diplomacy with 

President Ahmadinejad, which I think is a naive foreign policy, 

that, because of that, he is very timid and almost afraid to come 

out very vocally and strongly in support of any opposition movement. And that is the appearance that I think a lot of us in the 

Congress see. 

What are your thoughts? 

Ambassador FELTMAN. Well, I don’t think that is the position. I 

think the position is to stand strongly on the side of the universal 

rights that the Iranian protestors have. 

Mr. MCCAUL. Well, why doesn’t the President—I would love to 

see him come out—I have not seen him come out—and state that 

very clearly on television. I have seen him on TV a lot. I have 

never seen him come out and say, ‘‘I strongly support the resistance movement in Iran.’’ Because it is imperative for our national 

security, as well, for this regime, the ayatollah and the mullahs, to 

go. 

Mr. CHABOT. The gentleman’s time has expired. 

The gentleman from New York, Mr. Higgins, is recognized. 

Mr. HIGGINS. Thank you, Mr. Chairman. 

Ambassador Feltman, you outlined in your opening statement 

the unique characteristics of what is going on in the Middle East 

and North Africa. It is clearly not anti-American; it is not antiWestern. The President isn’t being burned in effigy. They are not 

burning the American flag. 

And, you know, the two most powerful forces in these movements 

throughout that region seems to be technology and youth. These 

places are relatively very, very young. They are Web-enabled. They 

are very sophisticated in their use of this. It provides both organizational advantages but also aspirational advantages as well. For 

the first time, a lot of these people are seeing what is going on in 

the rest of the world, and they want to be treated like citizens, not 

subjects. So these are extraordinary times, perhaps unprecedented. 

My sense is, you know, what is the model that we look to? You 

know, do we want a place like Egypt? We want Egypt, I suppose, 

to become what it wants to become. But, ultimately, we have a 

strategic interest in that area, and there are several models to follow. 

Egypt could follow, I guess, an Iranian model, which would not 

be viewed favorably by us. But it could also follow Turkey, which 

has demonstrated, I think, an extraordinarily unique, pluralistic, 

33

strong economy. Twenty years ago, the exports in Turkey were, 

like, $3 billion. Today, they are, like, $140 billion. They are importing raw material and exporting finished product. 

So I would like to get your thoughts, both of you gentlemen, on, 

you know, what it is we would like to see emerge in the Middle 

East and North Africa as these new governments begin to take 

shape. 

Ambassador FELTMAN. We have done a lot of thinking about the 

models, Congressman. And you can go beyond the ones that you 

mentioned. You can talk about the Philippines, Indonesia, Eastern 

Europe at the end of the 1980s. There are a lot of models. Ultimately, you have put your finger right on it, which is that, in 

Egypt, there will be a made-in-Egypt solution to Egypt. And we 

will try to work with the Egyptians to help shape that solution in 

a way that meets their aspirations. 

I think you also put your finger on something that is essential. 

I mentioned that each situation is unique according to the circumstances of each country, but there is something shared. And 

that is, people are looking at how they are governed in a different 

way. The relationship between the governor and the governed is 

now far different in the Middle East than it has been in a very long 

time, if ever. And that is going to change going forward. 

So I would hope, again, that that spirit of Tahrir Square, the 

sorts of things that the Egyptians were asking for, things that we 

would see as universal rights or natural rights we take for granted, 

are what is going to govern a democratic Egypt going forward. Anyone that is going to win the presidency or Parliament in Egypt now 

is going to know that those people in the square could go there 

again. They are going to have to meet some of the aspirations of 

the people. 

And I will let George make some comments before I use up all 

the time. 

Mr. LAUDATO. I will just add that, as Congressman Ackerman 

has noted earlier, there could be a huge popular, populist reaction 

to what needs to be done in all of these economies as they move 

forward. 

I guess, in the face of that, we would like to see these economies 

move as private-sector economies and growths come from the private sector, so that we really do see the job creation that robust 

private-sector growth will entail. I mean, Turkey is a good model 

for this. 

And, actually, if we look back at Egypt over the longer term, 

Egypt actually has produced has significant numbers of jobs. It 

hasn’t kept up with the population growth rate, but it has created 

jobs probably faster than almost anybody else in the Middle East. 

That growth is based on private-sector-led economic growth, and 

we would like to continue to support that. 

Mr. HIGGINS. And then, finally, on Iran, which poses all kinds of 

challenges for us, but I think what we have learned with Egypt 

and the other countries in the Middle East and North Africa is that 

there is often a very, very different view of us from the regime to 

the people themselves. 

And Iran is a country of some 70 million people. Two-thirds of 

the population is under the age of 32. And they are very pro-WestVerDate 0ct 09 2002 13:43 Jul 13, 2011 Jkt 000000 PO 00000 Frm 00037 Fmt 6633 Sfmt 6633 F:\WORK\MESA\031011\65055 HFA PsN: SHIRL
34

ern. And I think that the basis for the Green Revolution in Iran 

is, again, what young Iranians see going on in places like America 

and in the West. 

So I don’t think we can paint that country with too broad a 

brush, and I don’t think that that serves our geopolitical interests. 

Mr. CHABOT. I thank the gentleman. The gentleman’s time has 

expired. 

The gentleman from Florida, Mr. Bilirakis, is recognized for 5 

minutes. 

Mr. BILIRAKIS. Thank you, sir. Appreciate it very much. 

Gentlemen, thank you for your testimony here today, and thank 

you for your public service. It is very timely, of course, the hearing, 

because of events that are going on in the Middle East and here 

at home. 

Yesterday, I was stunned to see a news report that unveiled, as 

far as I am concerned, the gross mismanagement of U.S. taxpayer 

dollars. The story’s focus was the government’s deficit-reduction report which revealed that hundreds of millions of taxpayer dollars 

are being funneled through the State Department in an effort to 

‘‘fight Islamic extremism and build relationships with the Muslim 

world by enhancing mosques oversees in places like Egypt and the 

Turkish-occupied territory of Northern Cyprus,’’ which is particularly offensive to me since the Turkish Army has been on a 36-year 

crusade to destroy and desecrate the religious heritage of Cyprus. 

American taxpayers are providing dollars to put computers in 

mosques and giving imams Internet service—that is what has been 

reported, anyway—to run jihadist Web sites that seek to radicalize 

not only their local populations but also American Muslims. 

Furthermore, we know that from past testimony before this committee from the Broadcasting Board of Governors that there is a 

real problem perpetrated by the Arab networks that are funded by 

the State Department. Some of these networks, such as al-Hurra 

TV, broadcast anti-propaganda to the Middle East. In other words, 

Americans are paying for broadcasts that actually fan the flames 

of hate and terrorism. 

So my question is, to what extent are taxpayers’ dollars being 

sent overseas to support extremists and terrorist behavior? And 

that is for the panel. 

Thank you. 

Ambassador FELTMAN. Congressman, we will have to look into 

the specific examples raised in the report, because, certainly, that 

is contrary to the entire intention of everything that we are doing 

overseas. And I don’t know the specific examples. You know, we 

will have to look into specific examples. 

But what I will tell you is how seriously we take our responsibility to combat terrorism and extremism and to use the money 

that is allocated to State Department programs wisely and to 

guard against benefiting extremism and terrorism. 

You know, I have worked—I was Ambassador in Lebanon. And 

I will tell you, the vetting process that we had for every dollar in 

Lebanon, to make sure it did not end up in the hands of Hezbollah 

or benefit Hezbollah in some way, was extreme. And I know that 

it is the same throughout the region that falls in the bureau that 

I have the honor to lead, that we are fighting against extremism. 

35

We are looking to provide tools for moderate voices. We want the 

moderate voices to be able to be heard, to have access to modern 

media, to be able to have access to information. So any examples 

that you have that are contrary to that are simply wrong. We will 

have to look into that. 

Mr. BILIRAKIS. Yes, please get back to me as soon as possible on 

that. I would appreciate that. I would like the details. 

Thank you. 

Mr. CHABOT. Does the gentleman yield his time back? 

Mr. BILIRAKIS. I yield back my time. Thank you, Mr. Chairman. 

I appreciate it. 

Mr. CHABOT. I thank the gentleman very much. 

I think the gentlelady from Pennsylvania, Ms. Schwartz, is next. 

And she is recognized for 5 minutes. 

Ms. SCHWARTZ. Thank you, Mr. Chairman. I appreciate that. 

And I appreciate your being here. 

And I wanted to follow—a little different, but follow up on what 

my colleague, Mr. Higgins, was talking about. He presented, I 

think, a real hopefulness, if not uncertainty, but a real hopefulness 

about what is going in North Africa and the Middle East, I mean, 

Tunisia, Egypt. I hear it in your voice, as well. As, I would say, I 

think it should be. I think we are appropriately anxious about 

where we are going here and how it is going to go. But there is 

just a sense of hope and optimism coming from the ground. And 

you are pointing out that it is not anti-U.S., it is not anti-Israel, 

it is not anti-West. It is a hopefulness, both economically and politically. 

So I wondered if you could tell us a bit more about what is obviously a more troubling situation in Libya. And there has been a 

conversation in some of the press about the use of some military 

action. Obviously, I think there has been real—I am not going to 

ask you about that; I am going to set that aside—no-fly zones, 

something like that, that would require us to really choose a military option, whether that is for humanitarian reasons or not. But 

that puts us down a whole different road. 

So my question for you is, how much can you tell us about what 

the elements that you are using, all the capacity that we have 

within State to reach out and really try and resolve this situation 

and reduce the violence? Not just the humanitarian action, although that would be interesting for you to talk about, but I am 

really talking about diplomatic, economic, both unilateral and multilateral, efforts that are being made to resolve this situation in a 

nonviolent way. 

How much can you tell us about that? I assume some of it is 

being done quietly. But if you could share with us what is happening, it would give us some sense of resolution and hope for that 

also being resolved in a way that gives Libyans a chance for selfexpression and rule of law and, of course, right now also make sure 

that additional harm does not come to hundreds or potentially 

thousands of our fellow citizens around the world. 

Ambassador FELTMAN. Congresswoman Schwartz, thank you. 

I mean, it is appalling to watch what is happening in Libya. It 

truly is. And, as the President and the Secretary have said, QaVerDate 0ct 09 2002 13:43 Jul 13, 2011 Jkt 000000 PO 00000 Frm 00039 Fmt 6633 Sfmt 6633 F:\WORK\MESA\031011\65055 HFA PsN: SHIRL
36

dhafi has lost the legitimacy to rule when he turns his forces 

against his own people. 

One thing to watch is how much Qadhafi and his circle have 

talked about us. There is a lot of focus on the United States. And 

that reinforces one of the principles that we are going forth in trying to address the problems that you raised, which is to work with 

the region, to work with the international community. 

This is not about the United States versus Libya. This is about 

the world being appalled by what Qadhafi is doing to his own people. And so we have been working to build a coalition. At the U.N., 

it resulted in a Security Council resolution. In Geneva, it resulted 

in Libya being tossed out of the Human Rights Council. The Arab 

League suspended Libya’s membership. 

We are in touch with the African Union, the GCC—the Gulf Cooperation Council—the Arab League, the U.N., the EU, a number 

of people bilaterally, a number of countries bilaterally, about how 

to isolate Qadhafi and his circle, how to hold him and his circle accountable, how to protect the citizenry as best we can, how to provide humanitarian assistance, how to reach out to Libyans across 

the political spectrum, which is why we have had such an outreach 

to the people associated with the provisional council. 

Humanitarian assistance is both about how you get things into 

Benghazi, assess the needs, get things in, as well as how do you 

address the problem of the displaced. More than 100,000 people 

have crossed the border into Tunisia. 

But the main thing is, we are doing this in an international and 

regional context. This is not something that is the responsibility of 

the United States alone, nor should it be, to solve. We are working 

on it with partners. 

Ms. SCHWARTZ. Uh-huh. All right. Well, I appreciate that. 

I was involved a bit in a situation—and I will try to ask this 

really quickly—where the Department was very helpful. And it was 

the Office of the Coordinator for Reconstruction and Stabilization. 

They were very helpful with Georgia, when Russia invaded Georgia. And just wanted to know that they have also been involved? 

They were very helpful in that situation, and I assume you are 

using every tool in the toolbox. This would be one that was really 

helpful, both in reaching out and in terms of information, but also 

in stabilizing and humanitarian efforts. 

Ambassador FELTMAN. Yeah, I was Ambassador to Lebanon in 

2006 with the war, and they were also—that same office was very 

helpful to me, as Ambassador, in how we responded to the needs 

after the end of that war. And so we are looking across the State 

Department at how best to use all the resources we have. 

Ms. SCHWARTZ. All right. Well, thank you. 

Mr. CHABOT. Does the gentlelady yield back? 

Ms. SCHWARTZ. Yes, Mr. Chairman. 

Mr. CHABOT. Okay. I thank the gentlelady. 

The gentleman from Pennsylvania, Mr. Marino, is recognized for 

5 minutes. 

Mr. MARINO. Thank you, Mr. Chairman. 

Good afternoon, gentlemen. It is a pleasure to be here with you. 

Thank you for your service. 

37

Mr. Ambassador, I know how serious you are about your responsibilities, both of you. And I understand the awesome responsibility 

you have at State. But could you answer this question for me in 

outline form, because it is a very detailed question, but very short. 

We have a situation where we are over $14 trillion in debt. And 

when I go back to my constituents, they are used to reading, you 

know, one-liners in the newspaper, hearing one-liners on television 

about how much money we send overseas—billions of dollars overseas. Some of it, I may agree with it; some of it, I don’t. And we 

are even sending money to countries that just hate us. 

Can you give me a rundown of how you account for that money? 

Now, you said you have meticulously—I don’t think you used the 

word ‘‘meticulously,’’ but you supervise it well. Could you give me 

an outline of how you do that and how you are certain that money 

is used for what it was intended? And how do you come to the conclusion on how it is intended? 

Ambassador FELTMAN. First of all, just talking about the budget 

for the bureau that I oversee, for the foreign assistance part, we 

are asking for, for 2012, $6.84 billion for the core and enduring activities that we would like to see across the Near East region. 

Of that, 85 percent is part of the comprehensive peace, securing 

Israel and the region—85 percent. That is assistance to Egypt, 

Israel, Jordan, West Bank, and Gaza. So that is the bulk of it right 

there, of the $6.84 billion that we are asking for, is part of the, sort 

of, core of the comprehensive peace we would like to see. 

Now——

Mr. MARINO. Could I interrupt for just a minute? 

Ambassador FELTMAN. Yeah. 

Mr. MARINO. Eighty-five percent of it. Now, how do you follow 

that? Or do we not follow it, the expenditure of that 85 percent? 

Ambassador FELTMAN. It depends on the parts we are talking 

about. For example, all military assistance that would go toward 

training of units or individuals, that has to be accounted for in 

terms of Leahy Amendment. You know, are units or individuals involved in human rights violations? 

In terms of military equipment that goes out through sales or 

through assistance, that has to go through end-use monitoring. 

Each program has a discrete way of monitoring to make sure that 

it goes for the intended recipient, that it goes for the intended use. 

And, of course, we also have various checks that come in, the inspector generals, what have you, that will check us to make sure 

that we are checking things appropriately. 

So we are very aware of the need to account for what the taxpayers are giving us for what we see as our core and enduring activities in our region. 

Mr. MARINO. Could we get down in the weeds just briefly on the 

accounting? Let’s take the number of $10 billion. We send $10 billion to a country. And out of that $10 billion, $3 billion or $4 billion 

are accounted for humanitarian needs and some of it for military 

needs. 

How far down in the weeds do you get, other than someone saying, ‘‘Well, we used $3 billion for humanitarian needs and $2 billion 

for military equipment’’? 

38

Ambassador FELTMAN. It would have to be a lot deeper than 

that, Congressman. It has to be a lot deeper than that, because 

there are anti-terrorism controls we have to put on. You can’t simply provide a bunch of assistance and not see where it goes. 

For the most part, we are not giving cash anyway. For the most 

part, we are providing contracts. We are providing some grants; we 

are providing some equipment. But we are not turning over, you 

know, money that is fungible. We are funding activities that we 

argue would be in the interest of the U.S. People, the U.S. National 

security interests. 

I mean, George, do you want to give an example of an accounting 

on an AID part? 

Mr. LAUDATO. Sure. 

We do fairly detailed accounting, both in terms of how the money 

is spent but also what we get for the money that we are spending. 

So if we are looking at—if we provide X million dollars to build a 

water system in the West Bank, we contract for that. We monitor 

the contract to make sure that we are getting what we are paying 

for. And then we monitor the impact of that water system, that it 

has on the community once it is completed. 

And if you look at a program like Egypt, which we have provided 

more than almost $30 billion since 1975, there are pages of accomplishments that have been achieved: The Cairo water system, 

the——

Mr. MARINO. All right. My time has expired. Thank you. 

Mr. CHABOT. Yeah. The gentleman’s time has expired. 

The gentleman from Florida, Mr. Deutch, is recognized for 5 minutes. 

Mr. DEUTCH. Thank you, Mr. Chairman. 

Secretary Feltman, in light of the speech that Robert Einhorn 

gave yesterday, suggesting that Iran is moving toward the threshold of making nuclear weapons and we have no choice but to increase the costs on Iran by tightening implementation of existing 

penalties and existing sanctions, can you give us an update, where 

we stand on the current sanctions investigations with respect to 

those companies doing business in Iran and when we might see the 

next round of determinations? 

Ambassador FELTMAN. Congressman, I know the investigations 

are ongoing in the State Department’s Bureau of Economic Affairs. 

But what is, I think, as important to keep in mind is the number 

of companies who have pulled out or curtailed operations, ceased 

operations in Iran, companies like Shell, Statoil, ENI. These sorts 

of companies have ceased operations because of the Comprehensive 

Iran Sanctions and Divestment Act. 

So it is not simply the investigations which are ongoing. It is not 

simply the fact that Secretary Clinton was the first Secretary of 

State to actually sanction a company under the Iran Sanctions Act 

and then CISADA, the subsequent act. It is that we are using this 

effectively to be able to dissuade companies from going in, from increasing investments, and also to convince them, in some cases, to 

pull out. 

Mr. DEUTCH. Secretary Feltman, if you can get back to us after 

you learn when we can expect the next determinations. 

39

And then, finally, I just have one further question, Secretary 

Feltman. Last week, a report surfaced that one of my constituents, 

Robert Levinson, missing from Iran since 2007, might still be alive. 

Can you give us any update on the progress of the case? And can 

you speak specifically to whether the Iranians have been cooperating in any way, either directly with us or with any of our allies? 

Ambassador FELTMAN. Well, we would welcome Iranian cooperation in finding out the whereabouts of Mr. Levinson. As you know, 

it has been 4 years since he has seen his family. He has had a 

grandchild who has been born since he has seen him. It has been 

too long since Bob Levinson has been away from his family, and 

we want to see him reunited. 

I can’t say much about the investigation. It is an ongoing investigation, and information is protected. But I will say that we would 

welcome any information that Iran has that would help us locate 

the whereabouts of Mr. Levinson and return him to his family. 

Mr. DEUTCH. Thanks, Secretary Feltman. 

I yield back. 

Mr. CHABOT. I thank the gentleman for yielding back. 

The distinguished gentleman from Kentucky, Mr. Chandler, is 

recognized for 5 minutes. 

Mr. CHANDLER. Thank you, Mr. Chairman. Appreciate that. 

Mr. CHABOT. Not that everyone else on this committee isn’t distinguished, but Kentucky being right next to Ohio——

Mr. CHANDLER. Very much appreciate you especially giving me 

that appellation. Thank you. 

Ambassador, first of all, I notice on your resume that you speak 

Hungarian. Is that true? 

Ambassador FELTMAN. It was true. I don’t know if it is still true. 

It has been a long time since I practiced. 

Mr. CHANDLER. Well, I must tell you, I am very impressed with 

anyone who can speak Hungarian who is not a native Hungarian 

speaker. And I assume you are not, so congratulations. 

Ambassador FELTMAN. I had the good fortune to be posted in Budapest from the late 1980s to the early 1990s. That was an historic 

period in Hungary. I was thrilled; I dived into the language. But 

I am very thrilled to be now looking at another historic period, 

which is the transformation of the Middle East. 

Mr. CHANDLER. That is right. Well, not an easy thing, no matter 

how long you are in the country. 

In any event, two questions. And I will try to be quick so you can 

answer. 

First of all, Tunisia. Obviously, a critical time in the history of 

Tunisia. Yet our Government is proposing to cut aid to Tunisia 

pretty dramatically at a very, very critical juncture. 

Could you please address that, tell me why we are doing that? 

And isn’t that a little bit of a dangerous thing for our Government 

to do at this particular point in time, particularly given that Tunisia is one of the more Western-leaning Arab countries and has been 

a very friendly country to us? 

Second question, Syria. If you could address, to the extent that 

you can—you know, there are two schools of thoughts about Syria 

and the intentions of the Assad regime. You spent some time in 

40

Lebanon, so you are probably very familiar with the Government 

of Syria. 

There is one school of thought that holds that Assad may actually want to try to get a peace arrangement, some kind of peace 

deal. And, of course, if that were true, it would be good for everybody in the region and, I think, would be a major breakthrough. 

On the other hand, I think the greater school of thought is that 

the Assad regime views peace as inimical to their interests of regime maintenance, given that they are an Alawite minority in 

charge of that government there, that they actually need to have 

a conflict with the United States and, in particular, Israel, in order 

to maintain their regime. 

What is your viewpoint on that particular subject? 

Thank you. And I will listen to your answer. 

Ambassador FELTMAN. On Tunisia, of course, the budget was 

prepared last April. You know, the budget documents were prepared at a much different time in Tunisia’s history. At that time, 

Tunisia was cutting off security cooperation with us. They were no 

longer working hand-in-hand with us on a lot of issues that were 

of interest to us. It explains why you see the numbers you do in 

the budget. 

However, you may have heard the Secretary mention today to 

the appropriators that she is going to Tunisia next week. And we 

will be sending you some information shortly that I think will answer some of your questions about Tunisia. 

Because, you know, we agree 100 percent that we need to be responsive to the transition in Tunisia. Tunisia was a leader in the 

region in changing how the governed look at their governors, and 

they can be a leader in the region in this transition. 

I served in Tunisia. I very much understand the opportunities 

that are there. But we will be sending you something to the Congress on this very issue shortly. 

On Syria, you mentioned that I am probably familiar with the 

Government of Syria. I think they are familiar with me, too, from 

my time when I served as Ambassador in Lebanon. I was seen as 

kind of anti-Syrian, I think, from their perspective, when I wanted 

to be seen as pro-American. That is what guides me when I am 

serving overseas. 

President Assad has said repeatedly that he wants to see a comprehensive peace in the Middle East. He has entered into negotiations with the Israelis directly, indirectly before, most recently 

through, you know, Turkish mediation. 

But it is like what I said with the Lebanese earlier: Actions 

speak louder than words. To have a comprehensive peace in the 

Middle East, which is good for our interests, it helps protect Israel, 

Syria has to be part of the game, Syria has to be there. And we 

want to see whether or not Syria is sincere in its words on wanting 

peace. And that remains to be tested. 

But I will say that——

Mr. CHANDLER. About the regime maintenance issue and the minority being in charge, how much weight do you give that? 

Ambassador FELTMAN. Syria is a multiethnic society, as you 

point out. And Syria has so far not encountered the sort of 

concessional problems that you see in Iraq and in Lebanon. And so 

41

there is an argument that what you say is why that is, how they 

have been able to avoid those problems. 

But, again, Iran has said Israel must be wiped off the face of the 

earth, essentially. Syria has said we want peace with Israel. We 

would like to pursue that and see if we can get to that peace. 

Mr. CHABOT. The gentleman’s time has expired. 

Without objection, our Foreign Affairs Committee colleague, Mr. 

Poe, is welcome to participate in today’s hearing since most of the 

subcommittee members have already asked their questions. 

We will get to Mr. Connolly in just a moment. We have had two 

Democrats in a row, so, if you don’t mind, we will go to Mr. Poe 

now, if Mr. Poe would have some questions. 

Mr. POE. Thank you, Mr. Chairman. And thank you for not calling me ‘‘distinguished.’’ I have been called a lot of things in my life, 

but ‘‘distinguished’’ is not one of them. 

Mr. Feltman, I want to follow up on some questions. You and I 

talked on November the 18th—I was sitting on that side; things 

have changed; I am over here now—about, specifically, Camp 

Ashraf. We discussed the issues and the problems and the people 

that are there. And I want to go back to our conversation. I have 

your testimony before me. 

And I ask unanimous consent, Mr. Chairman, to submit it for the 

record. 

Mr. CHABOT. Without objection. 

Mr. POE. Thank you. 

We specifically discussed the issue of the loudspeakers around 

Camp Ashraf that are bringing in propaganda from Iraq, other individuals, saying all kinds of horrible things to the residents of 

Iraq. And our discussion was, what are we going to do about it. 

And so, here we are 4 months later, and I am asking you, what 

has happened to that situation and that intolerable noise and propaganda that is being brought into Camp Ashraf? 

Ambassador FELTMAN. Congressman, this is a really tough question. It is a really tough issue. Iraq——

Mr. POE. But what are we doing? 

Ambassador FELTMAN [continuing]. Is sovereign on Iraqi territory. The Iraqis are now sovereign. There are provocations that go 

back and forth. The Camp Ashraf——

Mr. POE. Excuse me, Mr. Ambassador. I only have 5 minutes. I 

just want you to tell me what we are doing and what has happened 

in the last 4 months regarding those loudspeakers. 

Ambassador FELTMAN. Okay. We are working with the Government of Iraq, we are working with UNAMI, and we are working 

with Camp Ashraf to stop the provocations that go back and forth. 

There are provocations that go in both directions: From the 

Camp Ashraf residents to the Iraqis, who are now sovereign in 

their own country; and from the Iraqis to Camp Ashraf. There are 

provocations on both sides. These are dangerous provocations. You 

don’t know where this is going to lead. We want to see these provocations end. 

Mr. POE. But what has happened? Let’s just talk about one side 

at a time. What about the speakers on the outside blaring in? Has 

anything been——

42

Ambassador FELTMAN. A lot of those are parents of Camp Ashraf 

residents from Iran, saying, ‘‘Please come back.’’ You know, a lot 

of these is Iraqi propaganda; a lot of it is simply parents looking 

for their kids. We don’t want to see provocations from either side 

on Camp Ashraf. 

Mr. POE. I want to show you a poster—and I will furnish you a 

copy that is smaller, so you don’t have to carry this around with 

you—recently taken from Camp Ashraf to the outside. And when 

you and I talked in November, there were 110 loudspeakers—here 

is a pole with a bunch of speakers on it—all blaring to the inside 

of Camp Ashraf. And now today, 4 months later, there are 212 of 

these loudspeakers. So it seems to me, if I do the math right, it 

has increased by 100 loudspeakers blaring into the residents of 

Camp Ashraf. 

The residents of Camp Ashraf tell us that these are all propaganda, saying awful things about the women in Camp Ashraf, inciting, I think, violence to occur. People live in fear. And it is constant. And, you know, I don’t know anybody, any American that 

would like to have outside their house a speaker going 24 hours a 

day saying anything, even if it is playing Willie Nelson music. Nobody wants to have that. But this is propaganda. And it concerns 

me because it concerns residents in Camp Ashraf, many of whom 

are Iranian Americans now, who have come to this country. 

What are we doing besides talking? It just seems to me, when 

all is said and done, more is said than done. So what specifically 

is being done, if anything, by our Government to take the speakers 

down? 

Ambassador FELTMAN. Iraqis are sovereign in Iraq. What we 

have to do is work with the Iraqis, work with the United Nations, 

to reduce the provocations, reduce the danger. 

But this is Iraqi territory. It is not U.S. Government territory, 

Congressman. And what we have to do is use our diplomacy, use 

our U.N. Partners, talk to other members of the international community, but we are not in control of——

Mr. POE. Reclaiming my time, Mr. Ambassador. So far, nothing 

we have done has helped to bring these speakers down—all the 

talk, all the encouragement. And it seems to me, if we have this 

conversation again in 4 months, there probably are going to be a 

whole lot more speakers. 

And I sincerely just hope that the United States is able to use 

its prestige to encourage Iraq to let these people live in peace instead of breaking the peace with—one way is the propaganda that 

is coming through these loudspeakers. That is my goal, and I hope 

the State Department figures out a way to make it happen. 

And I yield back my time. 

Mr. CHABOT. Thank you. The gentleman’s time has expired. 

The gentleman from the great State of Virginia is recognized, 

Mr. Connolly, for 5 minutes. 

Mr. CONNOLLY. Thank you, Mr. Chairman. And congratulations 

on your reelection and selection as chairman of our subcommittee. 

Mr. CHABOT. Thank you. 

Mr. CONNOLLY. And I am reminded of the fact, listening to our 

colleague understandably concerned about the use of loudspeakers, 

that when the United States, through the Government of General 

43

Noriega in Panama, the American military used exactly this technique in front of the Vatican Embassy in Panama City. So I am 

sure we have some experience in that regard and understand how 

irritating it can be when used as a tool for propaganda. 

Let me ask—and now the vote has been called. But the title of 

this hearing is, ‘‘Assessing U.S. Foreign Policy Priorities and Needs 

Amidst Economic Challenges in the Middle East.’’

How important, at this time in history, given the upheaval in the 

Maghreb and Egypt and perhaps other places, as well, how important is our foreign assistance program as a tool or a policy priority 

as we face those challenges? 

Ambassador FELTMAN. I would say it is essential to us being able 

to realize our goals. 

Mr. CONNOLLY. Essential. 

Ambassador FELTMAN. Essential. It is part of our overall development, diplomacy, and defense approach to the region. We need to 

have all three. 

And if you look at, say, the military assistance to the Egyptian 

Army, the Egyptian Army, by and large, has reacted to the events 

in Egypt in a very professional manner. I think that we can take 

some credit for that, for the years of training and work that we 

have had with the Egyptian Army. 

If you look at Iraq, going forward in Iraq, the diplomacy and development side of our work in Iraq will help make Iraq that sovereign, stable, self-reliant partner that is in our interests——

Mr. CONNOLLY. So, Mr. Ambassador, what you are saying is, if 

you look back over the years of investment since the Camp David 

Peace Accords were signed, with respect to Egypt, for example, it 

paid off in this transition; in terms of helping build a force that respected demonstrators and their human rights, and is a force for 

stability in this transition. And, moving forward, we need to be 

making like investments in the region that will pay off sometime 

down the road. Is that your argument? 

Ambassador FELTMAN. Yes, that is my argument, Congressman. 

And that is the logic behind what I said for my region is a $6.84 

billion request for the core and enduring activities we have for the 

region. It is to advance U.S. Interests, U.S. National security and 

diplomatic interests, in this region during a changing time. 

Mr. CONNOLLY. Ambassador, I am struck by the fact that, just 

a few weeks ago, here in the House of Representatives, the United 

States Congress, sadly, from my point of view, significantly slashed 

the 150 Function of the budget. We cut funding for precisely what 

you just said we should be doing more of, not less of. 

Has the State Department even assessed yet what the potential 

ramifications in this region might be in terms of curtailing our diplomatic efforts and our foreign assistance efforts? 

Ambassador FELTMAN. I mean, yes, we have. And cutting $2 billion out, which is what this would be, would be cutting out a lot 

of the democracy programs that we need most right now. 

We also need, frankly, since you raised the question, we need a 

2011 budget. Particularly when I look at how are we going to do 

the civilian transition in Iraq, we need to know what our money 

is, we need to know what our budget is. 

44

So we not only hope that we will be able to get fully funded for 

2012, we also hope we are going to get a 2011 budget. 

Mr. CONNOLLY. Mr. Laudato, I see you shaking your head. 

Mr. LAUDATO. No, I couldn’t agree more. 

Mr. CONNOLLY. No, I saw you shaking your head in agreement. 

Mr. LAUDATO. Oh, absolutely. Absolutely. 

I have dealt with, for example, Egypt since 1976. I was in Egypt 

when President Sadat came back from Jerusalem. And I saw the 

impact that our foreign assistance has had on cementing the solidarity in the region on our foreign policy. And as we cut it, we cut 

the capacity to involve ourselves with these governments for the 

purposes that we deem are in our own interest and in the interests 

of our friends and allies. And so I think it is critical. 

Mr. CONNOLLY. Mr. Chairman, in the 16 seconds I have left, let 

me just say, I would hope that, upon reflection, Members of Congress here in the House would reconsider the cuts that we made 

to the continuing resolution in the 150 Function, especially in light 

of the profound changes going on in this region. 

And, with that, I yield back. 

Mr. CHABOT. Thank you. The gentleman yields back. 

And some real quick comments here. 

First, without objection, the witnesses’ full prepared statements 

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

days to insert statements and questions for the record, subject to 

the length limitations in the rules. 

Secondly, I need to correct myself. My crack staff has drawn to 

my attention the fact that I inaccurately recognized the gentleman 

by saying ‘‘the great State of Virginia,’’ when, in fact, it is a commonwealth. But it is certainly still great. Having been a graduate 

of the College of William and Mary, I should know that. 

We, the ranking member and myself, have a couple of quick 

questions that your response you can give back to us in writing. I 

will go through them very quickly. The reason we are doing this 

quickly is because we have votes on the floor, and we have to be 

over there and vote within 10 minutes. So we are going to do very 

quickly. 

As Egypt works steadily toward political reform, many people are 

calling attention to the economic situation on the ground, which is 

dire by any measure. Some of these measures are not just simple 

aid programs, many of which have been shown to be quite ineffective over time. 

The question comes down to a free-trade agreement between the 

United States and Egypt. Arguably, doing such would be good for 

Egypt and good for the United States. I would love to have the administration’s view on that. 

The other question, Ambassador Feltman: I had the privilege of 

asking Secretary of State Clinton about our Iran policy when she 

testified before the full committee last week. I specifically asked 

Secretary Clinton about our policy toward an indigenous Iranian 

enrichment capability. And I would like to ask you the same question today. Of course, you can respond in writing. 

At the recent meeting in Istanbul, the Iranians once again asserted their right to enrich on their own soil. A recent bipartisan 

Senate letter reflects the overwhelming concern in Congress about 

45

Iranian domestic enrichment. Last week, however, I was surprised 

to hear Secretary Clinton say that, if Iran were to live up to its 

international obligations, it would be allowed to enrich within its 

borders. 

I would like to be clear: Is this indeed the policy of the United 

States? Would we actually allow this regime in Tehran, a regime 

that openly calls for wiping Israel off the map, to enrich on its own 

soil? I would add that our record of detecting covert nuclear programs is not stellar. 

Additionally, recent reports suggest that Iran may be allowed to 

continue enriching in the interim during negotiations. The rumored 

Einhorn plan, for example, would supposedly allow Iran to maintain and operate 4,000 centrifuges on its territory. Is this an actual 

proposed interim measure? 

And I will now yield to the gentleman from New York, the ranking member. 

Mr. ACKERMAN. I thank the chairman. 

I actually think that I have what I think is an answer to a question that was raised by a colleague, rather than a question myself. 

Mr. CHABOT. Okay. 

Mr. ACKERMAN. The gentleman from California wanted to know 

who was going to be left holding the bag if we did debt forgiveness 

toward Egypt, whether it would be the big banks or us. The answer 

to the question, no matter who you ask it of, is us. It is not the 

banks. This was not money that the banks gave that we gave a 

guarantee. It wasn’t actually even money we gave to Egypt. What 

we did provide was food credit, in the tune of $3 billion, to feed the 

Egyptian people, who were adhering to policies that we greatly 

supported and wanted to be helpful and useful to them, as they 

were being very helpful to us. And the $3 billion in food credits was 

spent here in the United States. So all of that money benefited our 

farmers and our people here, as well as helping to feed the people 

over there. 

The question isn’t who is going to be left holding the bag, but 

whose bag you would prefer holding. If we have debt forgiveness, 

I am sure that there would be a great deal of gratitude on behalf 

of an emerging, hopefully, emerging democracy in Egypt. If we 

don’t have debt forgiveness, we are competing with the Muslim 

Brotherhood. If they win the battle of the street in the time to come 

and are going to be in charge of a new Egypt, God forbid, I am sure 

they are not going to be paying back that $3 billion any time soon 

and will not be grateful to us. 

So it is a contest between whose side are we on in the fight for 

these emerging democracies. And we are, indeed, the same people 

who are left holding the bag in all of the efforts. My friend advocated and supported, whether we helped the people in Iran, the 

cost of that, we will be holding the bag, and I don’t think that is 

a bad thing. And if we help the people in Libya, enforcing a nofly zone, the cost of that, we will be holding the bag. And he advocates, and I don’t necessarily disagree at the moment. And when 

we helped liberate Iraq, which he supported and I supported. 

This is a big responsibility, being the superpower in the world. 

And if we want to see good things, we have to be willing to pony 

46

up, step up to the bar. Otherwise, the bad guys are going to take 

over all over the world. 

And as far as the speakers, we are talking about Iran. And the 

chairman and I have worked out an agreement that we heard a 

rumor that there are ‘‘speakers of mass destruction,’’ and we are 

going to go in and see if we can eradicate that. 

Mr. CHABOT. The gentleman yields back. I thank the gentleman. 

And we thank the witnesses for their very good testimony here 

this afternoon. 

The committee is adjourned. 

[Whereupon, at 3:40 p.m., the subcommittee was adjourned.] 

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