and it is only in 2015 we discover the increase in the defense budget to come into effect. >> it is inevitable if there is an election, whoever emerges will take a view on expenditure beyond that. >> late in 2015. >> beyond 2015 because of the democratic process people have to wait and see what it takes. the prime minister has taken a view about what he would wish to see if he were prime minister. it is a matter of great concern speaking to the prime minister. >> do you share this personal view? >> yes. >> mr. mitchell? >> i do. >> you may have gathered -- [talking over each other] >> where the problem is. is there anyone in the cabinet of whom you are aware who does not share this personal view?

>> we are about to bring the cabinet before you. it is a matter one by one. >> there is one of thing. it is clear that if we want to get the future in 2020, as was agreed during the sdsr we are required to have the terms increase the budget and put us on all the ideas. if we for example -- there are so many assumptions, and very different figures but if we saw an economic growth that we want, if we saw as afghanistan, having 52% with defense spending be pretty you would see us get to that level. ..

>> what would be the consequences of failing to increase the defense budget by in real terms some noticeable amount from 2015? >> if we wanted the rate of real terms increase will determine how quickly we can get to the

benchmarks that we have set out for 2020. if it is a steep increase, we will reach that point earlier. >> what do you mean by steep? let's say 3% real terms increase pay year? >> well, that would be very nice. [laughter] >> and, of course, that -- it also depends on the decisions that we take in the early years as to where we are on the carbon as to the upswing of that. they are all dependent on, if, for example, we were to take steeper savings in the early year, it requires a sharper upswing in the late years to get to the same point. the rate -- the actual number of the real terms growth will depend on the number. >> you are still struggling for a billion pounds. this is ridiculous during the current time. >> chairman, to be able to make a contribution to the deficit

reduction, which is itself a national security liability, and deal with the budget that was 90% committed was never going to be an easy exercise. none of it pretended it would be. >> nobody has suggested this is easy. but you are suggesting a real term increase as it the prime minister just at the time when we are leaving afghanistan. how will you public work? >> we have set out what we believe to be the correct posture, and force balance for the united kingdom going ahead. in the sdsr, we had basically three options. one was to try to keep our head above water year by year, the other was to freeze contracts and not invest in future capabilities. the other was to say we're in a hole, let's find the strategic aiming point, 2020, that set out what we believe is the

appropriate force balance for the uk in that year and work out ways towards it. it was always going to be a difficult course to take, but i still believe it was the right course to take. [inaudible comment] >> we have your permanent secretary a couple of weeks ago, and we heard from you today, the decision on the future is being put off on the 2015. an unchartable observer may suggest that if there was for argument sake a change of government in 2015, they would put it to you that you have left what is i think called a black hole in defense funding. if you don't know that you are going to get a real terms increase to meet the pledges that this government has made for the period 2015-2020 is an unfair observation. >> civic might say the prime minister is committed to real terms increase spending in the budget. the plan might be to what the

future government might look like in terms of defense policy. >> but we can't -- we can't speculate. >> nor do we know when the crs period, until you are dealing with the treasuries on the assumptions of the future budgetary outyears as we approach those years. >> you are going to give us more detailed figures later which is very useful. you did say you might need to say something about whittled down through the current activities. can you say that now? one billion now? >> we will, by the time we are through the pr '11 planning, and we started pr '12 after pr '11 to give more space to start to look at some options. then we will have a better idea what those numbers are. until we actually through, i'm sure the committee understands the planning one.

>> okay. fair enough. madame? >> can i just clarify, are you saying that's your plan? you are going to confirm around '12, almost immediately after you are committed to plan 12, you are going to start working on that. we should be able to know really start or early into planning round 14 what your plans are for planning round 15, or if you are always planning well in advance. >> well, i think we don't plan far enough in advance. i don't think the department has sufficient flexibility. i think we have to try to get ourselves away from this level of precommitted budget. it means living from hand to mouth year after year after year. >> so you would go for the ten-year budget? >> indicative budget would be extremely helpful. >> indicative? >> well, of course, the government can't set ten-year budget.

but indicative. >> why not? >> because they are not going to be in the office for longer than five years. >> oh. and so governments that might be in office over an election is coming up can't set a budget longer for the period -- >> we can set the indicative budgets. we with work on indicative budgets, but we can't call them real budgets. >> the high level of concern you must be aware within the armed forces and amongst the public over the decision that have come up, what are you doing to address the concerns? how are i reassuring people? we've seen the high turnout today. it's possibility one the major inputs into the mailboxes. how are you going to address the concerns and reassure the armed forces and the public that they

are the right decisions for the country and not just for the treasury. >> we are using all of the elements, internal discussion with our staff, talking to armed forces and armed forces families, think tanks, editor briefings which are under taking to try to get a better understanding of some of the issues. but nobody wants to see, and i certainly don't want to see and i've never wanted to see reductions in our defense budget. but there's a reason why we have to reduce the defense and other budgets. that is that as i've often said, next year we pay more in debt interest than the mod, scob, and the budgets combined. that's becoming a strategic liability for the united kingdom. more of the money is committed to creditors, rather than

government to use on national security or what the government chooses to do. >> you said that you are going to make progress report on the defense group interviews. do you think that's sufficient? how are you going to involve parliament, and what did you commit to the first so it's committed? >> i would go further and quite happy to give an annual report to parliament as a whole, and give them a chance to comment. we are trying to become more transparent so that people can see what we are committing to and what future budget liabilities are. believe me, the least of my problems is giving the report to parliament. >> i think that we have finished here for this high level bit. we will ask you, dr. fox to come

back again. i'd like to express the committee's attitude for giving helpful answers, and missing another meeting. we appreciate that, and we appreciate the sense of priorities for that. thank you very much, indeed, for starting us in this extremely helpful way. order. order. [inaudible conversations] [inaudible conversations] >> a couple of live events -- >> treasury secretary tim

geithner says national security is at stake as congress considers his agency's $3.5 billion budget request for international programs. this hearing is an hour and a half. >> the subcommittee on state foreign operations and related programs will come to order. i'd like to welcome secretary geithner and thank him for appearing before the subcommittee today to discuss the fiscal year 2012 request for the department of treasuries international programs. additionally, i'd like to hear about the current status of the international monetary fund, given the large level of funding approved by the congress two years ago. secretary geithner, i know treasury's international programs are ones you worked on for many years before becoming secretary. i hope you'll provide the committee with your insight so we can better understand this

large request for fiscal year 2012. the president's budget includes $3.4 billion for treasury's international affairs programs. which is $1.2 billion, or 58% over the enacted 2010 levels. i'd also like to highlight that this is more than a doubling of funds since 2009, and more than 150% increase since 2008. all of these funds are contributions to international financial institutions, the exception of the treasury technical assistance and bilateral debt relief programs. last year i asked that you justify the need for such a large increase for multilateral assistance during an economic crisis here at home. this year, the fiscal situation is even more dire. the united states is facing record budget deficits, the president's fiscal commission released the report calling for freezing or cutting discretionary spending.

i don't want -- i know i don't have to remind you we are facing a different budget situation than last year. support to increasing for the multilateral development banks was already in doubt before the budget was formlated. now this administration is requesting almost $2 billion in appropriations and putting the u.s. taxpayer on the hook for another $40 billion in potential liabilities. mr. secretary, this committee never consented to these increases, authorization bills are needed for each bank spelling out specific forms and possibility withholding funds until forms are met. i can't support writing blank checks to the institutions. capital increases will be extremely difficult to justify without convincing evidence that the taxpayer dollars will be used in a more effective and

transparent manner than they have been used in the past. mr. secretary, i predict the subcommittee will face difficult choices. we'll have to look at each request to determine what is critical to our national security. we must prioritize spending by looking at what works, what is good oversight, and what is not duplicated elsewhere. i urge you to approach the subcommittee with your request in that context today and as the year progresses. finally, i want to mention the unique role the treasury department plays in u.s. foreign policy. your work to administer sanctions against countries like iran and libya and atrack terrorists financing is critical. members want to hear your comments on the important matters, i'm sure. thank you, i look forward to your testimony. afterwards, my esteemed ranking member, mr. -- mrs. lowey, then

chairman dicks if he has a statement, and then members based on the priorities on who was in attendance when it was called to order. i'll alternate between majority and minority. please keep your comments to five minutes. now mrs. lowey. >> thank you, i join you in welcoming you to discuss the request for the treasury departments international programs. 30 years ago, president reagan confirmed that international financial institutions, and i quote, have contributed to the spread of the hope for better life throughout the community. they have been inspired by the i deal of far better world in which economic growth and development would spread to all parts of the globe. for more than three decades, they have worked towards the goals and committed to results that are now clearly visible to all. end quote. those words still hold true today.

multilateral development banks reflect our fundamental values, support our economic interest, by lowering trade and investment barriers, supporting private sector growth, opening the markets of tomorrow, and giving people a chance to succeed. over the past decade, the world bank has built over 73,000 miles of roads, constructed and renovated 23,000 health facilities, saved 13 million lives, immunized 310 million children, provided water to 177 million people, brought better education to over 100 million children each year, and established more transparent and open systems to fight corruption and build strong government institutions in developing countries. these investments both alleviate suffering and play a vital role in helps countries to build trade capacity and become reliability economic partners. i'm pleased the president

requested $3.4 billion for international financial institutions, climate change funds, food security initiatives, debt relief, and technical assistance. this request is an acknowledgment of the importance of these institutions in promoting economic growth and stability, and protecting our national security interests. the continuing resolution recently passed by the house on the other hand, cut their funding to fiscal year 2008 levels. i hope you'll share with us what these substantial cuts would mean for economic growth, infrastructure development, health care, education, as well as the impact on the front line countries such as pakistan and afghanistan. in addition, your insight on the impact of scaling back the u.s. contribution to these institutions on our ability to influence lending decisions would be helpful.

the cr also convenes significant cuts to the international funds that address climate change and the environment, as well as to the treasury department's technical assistance and debt restructuring budgets. i hope you can describe the affect the cuts will have on developing countries and in turn on the united states. while i continue to support the work of the world bank, i remain troubled by the banks interaction with iran. i would like to hear details about the treasury departments efforts to prevent loans to iran, and to ensure that the bank complies with the united states sanctions. the world bank group simply cannot reengage with iran if it is to maintain creditability and future u.s. support. in these tough economic times, international financial institutions and multilateral development funds seem like an easy target for budget cuts.

but by supporting emerging economies, addressing widespread health and education challenges, building infrastructure, we are creating business opportunities for american companies. these programs are directly related to our primary focus of creating jobs and should not be on the chopping block. thank you again for your service, i look forward to your testimony. >> mr. secretary, please feel free to summarize your remarks without objection, your full statement will be submitted for the record. >> thank you chairwoman granger, ranking member lowey, members of the committee, i know this is a heavy lift. at the time we have unemployment above 9%, i think about one in eight americans on food stamps, and an economy still living with the scars of the damage caused by the crisis. this is a hard case to make.

i want to say the appreciate the difficulty, and the care and attention, and i appreciate, madame chairman, the attention that you have given and will continue to give to the conditions that we attach to our investments in these institutions. we all have ab obligation, across the board, making sure that every dollar that we ask the american taxpayer to put up in investments has the highest possible impact on returns. let me just summarize the basic cases as quickly as i can. i'd be happy to take your questions. i want to begin as i did in the written statement with an example from 20 years ago. a little more than 20 years ago, secretary james baker came before the committee and requested both the general capital increase for the world bank, and replenishment for i.d.a. like now, the request came at a very difficult time, a very difficult budget environment. but let me just quote what he said then. he said, quote, if we fail to support our own programs and

ignore or delay meeting our international commitment, the damage to u.s. national and economic security maybe vast. and he added that harm will not be easily undone. most people tend to think of these institutions in terms of their humanitarian mission, fighting disease, fighting poverty, the broad development imperative. that's right. you were right to draw attention to that. but you also need to think of the institutions as a vital part of any effective american strategy in protecting our national security interest and expanding opportunities for american businesses. secretary gates has taken eloquent of this challenge, as has general petraeus. i think the simplest way to say it, where american soldiers are now engaged in combat, our ability to get the governments to take on more responsibility for their own security will depend on their success in creating a functioning economy

that can generate not just opportunities for the st. s, but the resources that need to defend their security. that requires institutions that can establish and enforce the rule of law, protect property rights, allow businesses to function, provide education, et cetera. as you think about the humanitarian imperative, member the national security imperative. remember that these institutions are some of the most effective ways that we have available to advance the core american interest. it's also important to recognize these institutions are among the most important export programs that we have. that industry as instrumental in reducing trade barriers and providing a level playing field as the trade agreements we've negotiated. congress is going to have the opportunity to vote on the power trade agreement with korea and other countries in the coming months. but remember, institutions of the world bank and others have played an enormously effective role, and in the future will play an enormously effective

role in the opportunities in these markets and remember that as well. now as you know, of course, like in the united states, governments around the world are reducing spending and reducing deficits. and this is necessary and it is difficult. it is hard. but the real challenge is designing ways to reduce deficits that do not undermine our economic and our national security interests. and the real challenge in shaping effective deficit reduction strategies is how to do that and preserve critical investments in thing that is have the greatest impact on our core interest as a country. i want you to just take a moment and look to the example that you have in what the conservative governments in united kingdom and germany. united kingdom, the government proposed to cut their deficit by 8 percentage points as of share of gpd, and at the same time to increase the investments in foreign assistance by 50%.

they do that have a base that's three times the size of the economy what we provide in the united states. germany as well. very ambitious program for bringing fiscal responsibility, making sure they are living within their means, also proposing to maintain and increase the foreign assistance and investments. they are doing it for the same reason that we have to be careful in doing that. we live in a dangerous world. the world is not standing still. other countries like china are ready to fill the -- fill the -- any vacuum left by -- by a receding america. and we have to take a very careful look when we are going to cut back things like this to make sure we are not undermining our core interest. now these institutions are not perfect. they have made mistakes in the past, i'm sure they will make mistakes in the future. they are the most cost effective and better results of almost any other program out there.

they have much more impact in bringing about reforms in reducing corruption and increasing transparency that we are able to do are on our in many cases. we are the united states, we need our obligations, we meet our committees. the budget request includes commitments made by our predecessors and your predecessors. if we fall behind on those commitments, we will lose influence and describe institutions of the resources they need to carry out things critically important to americans. if we limit the resources available to the world bank, it will leave money governments will no choice but to return to countries like china who will tie their loans to conditions that help advance chinese commercial interest, rather than the broader interest we face and enjoy with a more level playing field. many of you have had the experience of traveling in asia and if you watch, you are seeing a dramatic expansion in the

scale and scope of activity on the development side by countries like china. the world is watching our budget today of the united states, not just to see whether washington is going to find a way on a bipartisan basis to make sure we are living within our means, but they want to see how smart we are and how we get there. and whether as we reduce our deficits, we reserve the ability to play an active role in expanding american companies on american terms. you are going to hear advise from lots of people who are going to make the choices. as you listen to the administration and colleagues and as you listen to the business community, listen to secretary gates, listen to general petraeus. i want to leave you with a quote from another gates, bill gates. of course, this is a man that has put a substantial fraction of his personal wealth behind the same basis cause that you are debates today. he said i am a big supporter of development systems because i am

convinced that the improvement in human welfare per dollar is far higher on this money than on any other dollar the u.s. government spends. and remember, these institutions are 5% of the 150 account. but they leverage resources that are equal 1.5 times the entire 150 account. and every dollar that we put into capital increase for the world bank averages $25. there is no more effective means, no more effective form of leverage at a time of limited resources than the commitments we are asking you to support through the institutions. i'd be happy to take your questions. >> thank you, mr. secretary. we've been joined by ranking member dicks. mr. dicks, do you have opening remarks? >> yeah, i have a very brief statement. thank you. secretary geithner, i join with chairwoman granger, and ranking member lowey in welcoming you. this maybe my first state foreign operations hearing, i am

not new to the issues surrounding national security. national institutions, debt relief, and programs make up the departments international programs fiscal year 2012 are critical to supporting our economic stability. as you addressed the challenges, food security, climate change, and development assistance for the worlds poorest. working to reduce the suffering around the globe is neither a liberal or convective, -- or conservative, it's a human cause. it's the right thing to do. bill gates was in my office yesterday. he has held meetings here in washington he has pointed out the importance. you can't do it all with philanthropy, you have to have the government programs. now when they are discussing budget cuts, foreign aid rises. nobody in congress likes foreign

aid, especially funding to multilateral international financial institutions. generally our constituents back home do not see the impact that such assistance has on job production. yet in reality, the involvement with financial institutions significantly advances opportunities for u.s. companies in developing markets. additionally, the vast security concern facing the u.s., especially during crisis like those we face throughout north africa, middle east, afghanistan, and pakistan, investment in foreign assistance in the form of multilateral development is crucial to addressing the root cause of conflict, preventing instability, improving peace. it supports by lower trade and investment barriers, supporting private sector growth, opening the markets of tomorrow, and giving people a second chance. i would just say, also, that i -- to my colleagues on the republican side, i honestly

believe that the cuts we are making are too severe. and we need to have a compromise. and i worry about the economic recovery. i worry about the situation we face with the state and local governments, the rising fuel prices, and then these cuts in discretionary domestic spending and defense. we are cutting $15 billion out of defense. which i was chairman of the committee with bill young. we put this together ourselves. so i'm worried about the -- not only what these programs -- the damage that's going to be done, but also the economic consequences right here at home. i mean my old economics teacher used to say when you want to lower the deficit, you put people back to work so that you create jobs and businesses prosper. there's more demand. and that takes down the deficit. we are just doing the opposite of that. i worry that it's going to have a negative economic impact. thank you. >> thank you, mr. dicks.

i'll begin the round of questions. i'm going to hold myself to five minutes. we'll watch that carefully. we also have two vote that is are coming up any minute. they are 15 minutes each, and wait as long as we can and adjourn, i know your time is very valuable, make our two votes, come back and finish. i'm going to start by following up on what mrs. lowey was talking about, about the subject of iran and sanctions. president obama, as you know, signed into law a stronger iran sanctions act last july that requires the secretary of the treasury to prohibit or impose strict conditions on opening or maintaining accounts on foreign financial institutions that knowingly engaged in activities. why has the department failed to

sanction banks in violation of the u.s. law? is it your belief that no foreign banks are conducting sanks -- sanctions in violation of u.s. law? >> very important question. let me tell you what's happened since that. you refer to one critical thing. congress passed and the president signed a very, very strong additional sanctions regime. but in addition to that, we've been successful in getting the european authorities and the countries around the world much tougher regimes too. when i was last year, we have made substantial further progress in convincing other countries to stop their institutions, banks and other from doing business from the sanctions that we have been pursuing. that's having a major impact, making it harder for the government of iran to stop them from doing. this is something that you have to be relentless about. you can never stop. because every time that you stop one avenue of raising finance,

they are going to try to find a way around that. you have to work to expand. we are working hard to do that. i have a terrific group of colleagues working closely with the intelligence community and national community with much more support than we've had. >> i support your relentlessness. i have one question, as long as i have the international monetary fund. the fiscal year 2010 omnibus include a number of conditions on the use of funds for the n.a.b., new arrangements to borrow. can you give us an update on n.a.b.? >> let me step back and say why did we ask congress to do that? it's the same reason why we are here before you today, asking for the additional capital increases for the world bank institutions. in the crisis, our encouragement and support, these institutions dramatically increase the financing they are provided for

trade finance, things like that at the time when the crisis was accelerating. if you look at the draft of the crisis, you find that exchange rates for emerging economies fell off the cliff against the dollar. trade stopped, export growth stopped globally, the world fell into a terrible recession. what this support did for the imf, world bank, and others, look at -- you can see it on a chart. it is by putting resources available out there, they helped arrest the fallen exports, bring those exchange rates back, and growth started to come with that. because the institutions did that, they created the substantial whole in the substantial capacity. that's why we are here before you today to ask for a replenisher for those institutions. so their lending capacity in the future doesn't fall dramatically because of the cost of the crisis. again, what they did was hugely important. the one reason why the u.s. exports have led, not just in agriculture, but high-tech and manufacturing is because of those programs now. >> thank you. >> in the imf, we don't -- it's

not activated until all of the other countries put up their money. if not mistaken, i'll check and give you a list of who else is signed up and who's still behind. no dollar of u.s. money is on the table under the agreement is activated. i'll be happy to give you an update on that exact list. what the imf is doing is it's core mission, which is for countries in crisis, they face financing requirement. what it does is provides and puts loans on the table. they pay interest but they come with tough conditions to help make sure the countries are bet -- are getting their act together, not just taking advantage. >> i'm going to interpret you. you are on my time. i'm going to stay to five minutes. ginn that, what you said, countries in trouble, there is a fear that the n.a.b. could be used as a european bailout fund. i know the imf has committed $40 billion to greece, and $30

billion to ireland, and it will pay 1/3 of the cost of the money used. is that true? >> you are right. the programs are necessary to help the countries bring about the reforms. although the europeans are putting the bulk of the resources on the table, the imf which does exist to give their members access to financing is providing a small share of the financing, roughly 1/3. this is what the core imf commission where members have financial problems for -- on tough conditions they can access the money. in this indication, the -- in this case, the europeans are carry the bulk of the burden. >> thank you. mrs. lowey. >> thank you. i'll talk fast. we face pressing domestic needs, it is chris call to leverage every cent of taxpayer dollars effectively and efficiently.

can you tell the committee what funding levels equal to 2008 mean for the asia development fund, the international development association, the global environmental facility, the international fund for accurate development, and how would 2008 levels affect the ability of the united states to meet it's commitments to global debt relief efforts? in the five minutes, do the best that you can. >> it will affect various institutions. but the core effect are two. in some cases, if congress does not authorize and appropriate the funds, then the institution and capital will not go forward and they will have to cut it's spending level, that's true in the case of the inter-american development bank. in other cases, if we don't provide authorization and appropriations, we lose inference. we lose our veto on the world bank, we fall behind china and indian, and let me say, it makes

no sense for us to put ourselves in that situation. think about the asian development bank. it's the most populous region, growing faster, the biggest opportunities for american businesses and the greatest risk that other countries are going to seek to take advantage of are receding in the united states. it's important across the institutions we meet the commitments that we make, because if we don't, we'll lose influence, seed the markets, and deprive the institutions of things critically important to americans. >> thank you. >> thank you, madame chair. as you know, billions of dollars of assistance have been provided over the past four decades by the bank. yet, economic development has eluded many of the recipient countries. while there are many reasons, there are concerns that the

government benefit directly or indirectly from much of the foreign assistance and intended for more worthy purposes and projects. now we are face with fund the capital banks by $2 billion over the next five years. can you explain the plan to bring the committee before congress so they can be debated. will it include reforms to banks and benchmarks that must be met before the funds to be released? >> absolutely. thank you for raising that question. let me explain how we do this as a country and government. this is how we have done it over time. republican administrations, democratic administrations. so what we do is when we face a compelling need for a financial replenishment, we consult with the congress, we determine the conditions that we would attack to such a replenishment, we negotiate the conditions, they are legislated by the

institutions, and it does not happen until and unless those conditions are in place and operational. that's the tradition that we adhere to. it's important that they understand that. just because we don't lend without conditions, we don't support the replenishments without reform themselves. over time, congress has approached the question about authorization language in different ways. sometimes it's carried on appropriation bills, and sometimes separately. what matters is that it happens. we are work with the counterparts on the authorized committee to make sure they understand, we have language that reflects those reforms, and that's helpful to us. we want to make sure the institutions that we will not be there until the reforms are operational. >> in my remaining time, i've examined the request before the committee for capital increases to multilateral development banks.

i can't imagine the committee would support writing bank checks to any of these institutions. as you know, the blank checks need reform, specifically in the systems which are not always as impartial when investigating charge defraud and waste by whistle blowers. there was an example in the american development bank, according to the press, they immediately dismissed the contractor manager in haiti, on the reconstruction contract. that's one the examples. what is being done with the banks to ensure they are impartial and management does not retaliate against corruption? >> thank you. i'm concerned about the same question. let me clarify one thing, we are not asking and would never ask you to write a blank check. even if you are willing, we wouldn't do it. the resources come can conditions, and to make sure

they are not just being efficient, but the best standarding for international control that we can. we are working very hard to make sure where there is problems that those cases we address them. not just in that case in the idb, but what i will try to draw your attention to, look to other people, not just me. look at the standards that those institutions set internally for internal controls and safeguards, they are dramatically better than they have, our reforms to be negotiated will make them significantly better, and i would hold them against almost any other program for development assistance. again, you can talk and look to bill gates and others of evidence. people who spend their lives in this business will tell you that the standards they have placed are not just much better than they were a decade ago, or two decades ago, they are dramatically better than than the standards that exist for programs. >> thank you very much. i misspoke, there's three votes. first in 15 minutes, then five

minutes. we'll do the same thing. we'll do our votes and then come back, if that's all right with you. mr. schiff. >> thank you, madam chair. the events in middle east and africa have been extraordinary. most of people, mostly young, to take advantage of democracy sure stir the hearts of american. bin laden isn't the face, it's muhammad, a fruit vendor that sent himself on fire to protest, and through his self-sacrifice, began the revolution that toppled mubarak, and leaders from yemen to libya. the most important feature is that it's organic. people are organizing, bringing

change, without any outside direction or intervention. this has instilled pride among arabs, but has also prevented the targeted government and al qaeda from casted this as a foreign plot. i think we need to remain mindful of this as we move forward. we also cannot afford to let the moment slip by without doing everything to help tunisia and egypt as they make the transition to democracy. the factors, lots of people on the high unemployment, wealth, and corruption that gave rise to the revolution are still in play. and if unaddressed, they will give rise to greater discontent down the road. yesterday, i met with a group of tunisian business executives. they said there's two things the u.s. can do to help in the next two months if the country is to be reborn. the first is to help locate

money by the ben ali family and cronies. i would love to hear your thoughts. this goes for egypt as well. the second issue they raised is that of debt forgiveness. of 2009, tunisia's external debt was $19.6 billion. it is classed by the world bank and not eligible for the multilateral debt relief initiative. are there other mechanisms by where the u.s. and other stakeholders can work to cancel some part of its debt to direct resources towards job creation that will help democracy and prevent the intrusion of radical islam? >> thank you raising that. let me say briefly, yes, of course, we are very involved and closely involved working with other countries to make sure that we are aggressive and

effective in making sure we can seize assets that we need to seize, and for the countries that you saw us move incredibly forcibly and quickly with respect to libya. we are on it. we have the most effective regime and sanctions of any country in the world, as we are demonstrating. tunisia and egypt is very important as we think about how best to support the political transition underway. we recognize that those governments, the new governments are going to face economic challenges, short-term challenges because of the crisis, and the affect on the economy. but also long term development reform challenges to make sure there's more opportunities for the citizens. as part of that, we will work closely with other countries in the region to make sure that we can provide the support that's going to be most effective in that context.

we'll look at everything, including the specific thing that you referred to. at this stage we are still trying to assess what's going to be most helpful and what's going to be the most powerful. one thing i can tell you for sure, is like anywhere around the world we're going to have to turn to institutions like the world bank. because they are going to have more resources in the pipeline, able to mobilize more quickly, better leverage for every dollar, and better capacity to make sure it comes with reforms and advance what you are referring to. >> mr. secretary, let me ask about the debt forgiveness, as well as the ability to track down the elicit eluding. >> we will be back as quickly as we can.

[silence] [inaudible conversations] [inaudible conversations] >> committee will come -- the hearing will come to order. mr. dicks. >> thank you. almost one people suffer from chronic hunger, and world food prices are at the highest level since 2008 crisis, as well as the heart of recent political and social instability in the

middle east. this is therefore more important than ever that the u.s. help assist countries in short-term food crisis. the budget includes $108 million for contribution for the global food program. the contributions to the fund are intended to leverage other donor contributions. yet today only the united states, six other countries, and the gates foundations have made pledges and contributions. what's the current status of contributions by others since the launch of the fund last year? >> thank you for raising this issue. thank you again for your opening statement. the -- i think the simplest way to say it is the world is looking to us. as they always do. they want to see how much we are prepared to put on the table before they come and make share commitments clear. the important thing is that this is headed -- has enormous

support around the world. you said the gates foundation contributed themselves alongside us. you have a number of countries willing to move, but they want to see how much we do. i'd be happy to provide you in writing on the details of those commitments. people are going to see and wait to see what we deliver. >> as i understand it, the request in 2011 was $408 million. and in '11, there was no request. is that because the money hadn't been all utilized, or what was the reason for that? >> i think you are right. but you have to go back and look. again, what we are trying to do, and the reason why we are using a fund like this, multilateral fund, we think it's the best way to draw other commitments on the table to ultimately get the investments in improving productivity and agriculture with least cost to us, best leverage for the dollar. in all of the cases, we add

broad framework, make the commitment, and generate as much support as we can. ultimately, it depends on what we are able to authorize and appropriate. >> i was wrong. the request was 408 --. >> yeah, it was probably the '11 request. >> yes. the other program that mr. gates raised with me was the global alliance for vaccines and immunizations, launched in 2000, the global health partnership representing stakeholders in immunization from both private and public sectors. now i assume this is another very important program that i'm told that, you know, for example, like polio, still afghanistan and pakistan are two of the countries that still are vulnerable to polio. >> exactly. what we found is, of course, as you might expect, although there's incredible innovation in

pharmaceuticals, led by u.s. companies, they tend to invest in the diseases that kill lives in other countries which we have no memory in the united states. the fund was designed, originally, it's been there before a time, to put resources on the table to help with the vaccines that still kill millions of people around the world every day. mr. gates was a pioneer in that field, and the gates have been leading the effort, the u.s. has been a part that have. that's part of the state department piece of the 150 account request. >> i think when the government shows it's commitment, it makes it easier to get people like bill gates and warren buffett to help support this. >> exactly. >> thank you, madam chair.

>> another is you are a market test, and the way it works. and the security trust fund and vaccine initiative in gavi, if you see institution that is have run major companies. this is a good return on our investment, you know, it helps -- it helps make your case. >> thank you very much. >> thank you, madam chairwoman. good to see you again, sir. started talking about iran, i'd like to go to one state sponsor terrorism to another state sponsor terrorism. terrorism travel to cuba is prohibited under u.s. law under the trade sanctions and investment act of 2000 section 9081 also 10 and b. as well as the hums-birdon bill.

obviously it is owned and operated by the cuban military and sponsor of the terrorism. a state sponsor terrorism that not only has murdered americans, cop killers, since '09 has american-held host annals as you know. recently there has been proliferation of attempts to skirt that law. my question is, is opec making enforcement of cuba a priority? >> of course. and we are set by congress in the area. the changes that you refer are modest expansions. >> mr. secretary, i bring that up because i have examples. these didn't take a lot of resource. cuba announced after obama eases

u.s.-cuba travel restrictions. here they talk about in the own web page, they created the whole part. they are well known as a terrorism outfit. they talk about here venture tour operators expect advance in books, and cuba's beaches, options to snorkel, options to see pirates, rum sampling. this is tourism. i have another example, makes cuba travel easy. they go into how to help people qualify under the law. but again this is another tourism outfit. we have one, which i believe, mr. secretary, i believe that y'all have stopped a fishing -- i believe it was the fishing tournament or something that was leaving out of sarasota.

the hemmingway fishing tournament in -- we have fishing tournaments in florida. they are tourism. can you give me the assurances that you will look at these and others? these are blatant, they are blatant attempts and others that may not be so blatant to skirt the law and actually, you know, just using pretext of other things, going there for what is obviously just tourism. >> i appreciate you bringing those to my attention. i'll be happy and convey with my colleagues at ofac and ask them to get back to your staff exactly on where the line is and how we are enforcing, and what falls short of the line, what falls outside of the line. you are right, these are a relaxation, but it's a limited modification, and, you know, again, we'll enforce the line to the best of our ability. >> and i appreciate that. and again, you know, obviously we can talk about whether we

agree or disagree with the relaxation. the issue with you, obviously today, is making sure that, you know, we do not violate the statue, the statute is very clear. obviously there are going to be, there always have been, but now it seems to be an explosion of groups and individuals that are looking at ways to go to cuba, claiming that it's something that it's not. i appreciate your efforts. thank you, madam chairwoman. >> thank you. mr. rothman -- sorry, mr. jackson. >> i'm prepared, but i think mr. rothman was before me. >> thank you very much. mr. rothman. >> thank you. mr. secretary, good to see you again. thank you for your readiness and willingness always to come before members of the congress in the committeed to answer all of our questions. you have been tireless, and transparent with what the

administration is doing. i'm very grateful for your enthusiastic compliance with our request to have you meet with us. i have spoken written support in the things that you have talked about, the multiplier factor of our foreign assistance and our diplomacy, and our participation in these international aid funds. but i do want to be a devil's advocate just for a moment. you did mention that because we do need to find additional spending cuts, not cuts that hurt the middle class jobs or innovation, or infrastructure in america, or u.s. national security interest, but nonetheless, we have to find cuts. they are all going to be tough. the asia development bank, you mention, if you don't pony up with our share of money, china is going to stretch into the

breech, and that will have a national security implication, of course. also their establishing business relations for their own state-run companies. could you flesh that out a little bit more? how exactly does that work? how exactly does china use those investments either to enhance it's national profile to the detriment to the united states, and or it's business profile. >> you know, it's worth thinking back again to when the institutions were created in the aftermath of world war ii, and almost 50, 60 years ago in some cases. think about how important the world was then. at that point, we were the overwhelmingly dominant power of the world. today, despite the strengths, they are formidable, the balance of power changed, we are 1/5 of gdp, we only have 5% of the worlds population.

if it was important then to make sure we had multilateral institutions to help use, think how much more important it is today in the world where our relative share of activity and influence is significantly less in relative terms. now in these institutions our influence comes through a combination of in some cases the veto we still hold over core decisions. but, of course, ultimately in the capacity to shape the reforms that come with the assistance that banks provide. it's not interest of american companies and generally that we have as much capacity to shape the conditions as possible. >> what do you mean by that? >> example, we have led the focus on corruption, on reducing trade barriers, on making sure that property rights are protected, that the basic institutions allow businesses of

market economies to work are established in the countries as they develop. and the asia development bank and world bank and imf play a central role in doing that. those are things we cannot do on our own bilaterally. >> does china benefit on the issues of corruption and lack of transparency? >> again, two things happen if we don't meet our commitments. one is we lose our relative veto right. and in that case, countries have more influence in shaping the conditions, or they have less resources to lend. that means that institutions that have much more substantial capacity to provide trade finance development is on their own than we will as a country, will have more influence. >> mr. secretary, what do you say to those who suggest the united states is baring undue share, or extra large share of the free worlds military obligations? and we -- >> i would say it's

unambiguously the case. >> that is the case. that aside from serving u.s. national security interests, in instances of natural disasters, tsunami, tunisia, haiti, earthquakes, and all over the world, as well as u.s. being ready to air lift people out of harm's way, that has a national security, as well as positive influence on u.s. relations with those nations. and that in an era of scarcity here at home, albite hopefully short. we have taken the cuts in defense. why can't we live with some cuts in these other programs? >> well, here's one way to think about it. because we have scarce resources, we are having to cut,

that makes it more important when we spend $1 on development assistance, we are spending it in a way in leverages change and reform that makes sense for the united states. so you want to make sure, you are making exactly the right case. think about the world bank. $1 of u.s. -- >> i understand the multiply. one to $25. but let's go even further as some of the people in the town hall meetings would say to me, reduce it to the absurd, why have any foreign development bank involvement? >> we will have less opportunities for american companies, weaker at home, direct impact on jobs at home. what is leading the recovery in the united states today? to a substantial degree, it's coming from exports. across agriculture, high-tech manufacturing, small businesses, large businesses, that is

because we are seeing the kind of market opening like the world bank and development getting supported over time. we want to make sure that's happening over time. we get a good return. again, not to quote bill gates again, but look at bill gates. this is a businessman with a remarkable record of innovation, and providing. these are the most effective uses of the taxpayers money than we have to point to. >> the question is he referring to the savings of lives, which is laudable thing, or referring to the success of the american businesses? this maybe both. i don't know if i have time for a question. >> saving lives is what he's talking about. >> right. not necessarily, but bajaeen banking. do i have time for that? >> no. maybe next round. >> thank you.

>> thank you, mr. secretary, for being here. i'm going to change the course here. let's talk about the new york stock exchange now being owned and purchased by a foreign company, and as far as providing financial services for the iranian government and businesses, in addition, at least $2 billion in iranian funds held by clear stream have been frozen as part of the effort by the families and u.s. military marines killed or injured in the 1983 terrorist attack on the marines in beirut. i'd like to get your thoughts. are you concerned that the new york stock exchange is going to be owned by a company that's allegedly, and i think is, conducting business with iran? >> difficult for me to address that for the following reason. under the basic protections that

congress has established to make sure while we run an open investment environment and protect the security national security, i don't have the capacity to comment on any individual cases. what i will tell you is that we will be very careful to make sure that where we welcome those types of merger, where we welcome foreign investment of the united states, we are going to be protect the national interest. if there's condition, we'll make sure to address it. >> when you address it, you are going to keep in mind violations of sanctions? >> i don't want to imply anything. but of course that will be one the things we look into. >> let me move on. hezbollah, it's widely known that hezbollah has terrorists groups and finance the activities in the lebanese

banks. the same lebanese banks are providing hezbollah access to u.s. dollars. is the treasury department looking at this? are you investigating this? >> absolutely. i'd be happy to have my staff tell me more details. we announced another important effort to make sure we are stopping exactly that kind of activity. but this is very important. i'd be happy to have my colleagues brief your staff in more detail on exactly what we are doing and what we see as a risk. >> anything specifically dealing with the lebanese-canadian bank? >> yeah, i want to be careful. i'd be happy to provide you details in writing, where we have acted, why, and where we think the remaining challenges are? >> let me ask one last question if i could. following up on the imf reports. the recent reports suggest that the possibility of using special drawling rights, sdr, to replace

the u.s. dollar on the world currency. many economist believe there will be disastrous for the dollar and american economy. many of the worlds currency is held in dollars, and such as oil is priced in dollars. many believe the status as the world reserve currency helps the dollar maintain the value and bolsters american competitiveness overall. in your opinion, what affect would it have on the value of the dollar, the overall u.s. economy, and our position as a global economic leader? >> i think you understand the stakes. you said them well. let me say clearly, there is no risk of the sdr playing that role. the sdr is not a currency. it's a unit of account. and it can't provide the role that many people aspire to it. there's no risk of that happening. and again, the dollar does play

this unique role in the global financial system. i think that's likely to continue. it's important to recognize and again since i'm here before the appropriations committee, i want to say this. we have to make sure we are being careful as americans to make sure that we are earning the confidence of americans in countries around the world that we can run responsible economic policies, go back, and those things are important to make sure over time we are sustaining with all of the rule as a major reserve asset. >> just to expand on the question, when you say there's no risk, there are many concerns that have been brought forward and aridessing about the growing chinese influence. and intrusion in the asia and global economies. i believe my question is with that happening? >> no risk that the sdr is going to play a role that will affect the dollar in the international system? >> the sdr evaluation included?

>> yeah. >> time up. >> can i say quickly? >> yes. >> very important that the chinese let their currency depreciation over time. and also on the currency internationally, which is appropriate too, and over time to help make sure the market currencies which is important to us. >> mr. jackson. >> thank you, madam chair, and mr. secretary, thank you for taking time to visit our subcommittee. i have a couple of questions, for most of my tenure in congress, i have advocated for full employment. i know humphrey also advocated, and we have arrived at levels. i truly believe that ending unemployment will solve a lot of the problems that our country faces. i'm sure you have seen the unrest in north africa and the middle east. one the things that the

countries appear to have in common for which the committee addresses, high levels of unemployment through the various aid, whether it's bilateral, or multilateral assistance. what role do you think levels of unemployment are playing respect to instability, and north africa, and how treasury is working with other governments to bring down the unemployment levels? >> i think you raise an important question. you are right to point out in a country like egypt, for example, not only is unemployment -- overall unemployment very high, but concert among people who are well educated and among the relatively young. people who watch egypt closely believe that it's part of what's provided so much force to the democratic movement sweeping across the region. again, it's important as we watch the political transition unfold that we are making sure we have the capacity, including through the institutions, to support reforms and have to expand opportunities in those countries. and, you know, it's going to be a very -- a big challenge for

any of those governments. they are going to need some help and we're going to make sure that where we can provide help alongside the institutions, we do so in support of reforms for exactly the reason that you said. >> clearly unemployment is a significant factor in people losing faith in their government. i sat anxiously at the president's state of the union address. i heard him mention job creation 31 times. he mentioned innovation, i believe, 15 times. but he failed to mention unemployment one time. at the time he delivered that speech, unemployment in our country was around 9.1%. at least those are the accepted levels of the labor department. is there any concern that the administration that high unemployment in our own country coupled with budget cuts by the federal government followed by the states which will make similar cuts in similar programs that a significant number of american people could wake up one day without faith or belief

in the government's capacity to solve a problem? >> i would agree. when the president talks about jobs and imperative of more jobs, he's saying it in recognition of the fact that we're living with unacceptably high levels of unemployment. you are exactly right. this financial crisis caused not just a huge amount of damage to the basic wealth and economic security of americans, but huge damage to the basic faith in the ability of washington to provide the basic protections and opportunities that they need. i think it's so important that we recognize that even though we are 18 months into a growing economy and we're seeing job growth start to come back, we are a long way from the damage caused by the crisis. everything that we do here, as we try to reduce deficits and reduce spending, we have to make sure we are focusing on repairing the damage and getting millions of americans back to work. that's why it's important that we are making the investment in public infrastructure, and investments in the united states.

without that, the risk is going to take a much longer period of time to bring that unemployment rate back down. >> is there any concern in the administration that high levels of unemployment are discouraging the american people and their belief in the capacity of the federal government to solve a problem? including state governments, given that many states are following the lead of the federal government? >> well, that's an interesting -- that's a complicated question. i would agree with you that what you have seen is a big loss in faith among americans, really just because of what the crisis did. also in some ways, you can say the recognition while it's happening at the state level as governments have to cut deeply into basic services that americans import. police on the street teach you in the classroom. they are seeing again how important that it is that the government preserves some capacity to do things only governments know how to do. that's going to be part of any effective strategy to dig our way out of this crisis. >> very quickly, almost three weeks ago, the house passed hr1,

omnibus spending bill for '11 for climate funds, multilateral banks, what would be the ramifications if hr1 was enacted into law? >> they would be damaging. that's why the president said he would toe. i think the senate is voting. as we find bipartisan ways we do so in a way where we need to save less and cut back and not doing a good job at things and reserving the capacity to invest in things that are hugely important, not just growth today, but growth in the future, if we have too many too quickly, then the risk is that we hurt the recovery, unemployment will stay higher longer, and we'll sacrifice our ability to be stronger and more competitive in this more competitive world.

>> thank you. we'll begin the second round of questions. the hearing has to end at 3:30. he has been patient as he waited for us. we'll begin the next round. try to keep it short if you can. i'm going to ask about the budget request that includes $175 million for the multilateral debt relief. i understand it's the commitment that had the u.s. paying 20% of multilateral debt. i noticed this has not been authorized yet. it wasn't debated by the congress, it leads me to a number of questions. the first one, i'll be very con size, given the multilateral development banks and the imf continue to provide loans, i think haiti is the most recent example, how can you convince the members today of the impoverished people benefit not the banks, so they can continue making loans? >> very good question. it's a question that congress

has wrestled with for about two decades. we have -- what we try to do is provide a mix of different forms of assistance. grants, concessional loans, and in some cases where it makes sense, debt relief in return to condition. what matters is that you are improving the capacity of the government to address the needs of their citizens, and not left with burdens they can't afford. the mix on different countries will depend on the history. what we try to do is have the capacity and have a mix that's going to make sense, given their needs. in each of the cases, whether it's debt relief, or loans and sort of independent. we want to make sure it comes with conditions that maxized the incentives and the obligation of those governments to do a better job of meeting the needs of their people. >> i just question the loans when there's no indication they'll ever be repaid. that that is a loan. it's a grant. >> well, you are exactly right.

when we try to do in particularly cases like that, we want to make sure that we are not providing assistance on terms they can't afford and can't pay back. in haiti, we have been successful in making sure there's a package on the table that's highly concessional, for exactly the reason that you said. there's a good case that congress has supported for 20 years. conditional debt relief as part of these financial program that is are again, always in support of reforms so that the benefits reach the people of those countries. >> i'll rephrase the letter that i wrote in july that stated the concern that i have, indebtedness to a country in which the people are suffering but have no way to pay it back. i would go next to mrs. lowey. >> thank you. i've been very concerned, not just with the banks, but in all of our foreign aid programs, and

i would say domestic programs too. the whole issue of fraud, corruption, transparency. the world bank has conducted various reviews, has announced new policies focused on creating greater transparency, and increasing effectiveness of it's anti-corruption and governance mechanism. in fact, just the past year, the bank debarred 45 companies, ngos, individuals, and made 32 referrals to other governments for criminal action. i know you are aware of that, can you tell me what reforms are still needed to inject further momentum and cooperation into global anti-corruption efforts and what more does treasury believe the bank must do in order to be transparent and openness? look, transparency and openness starts from the top, and

although civil society has observed the status, they are not part of any decision making that the bank. in addition, have there been discussions at bank to reform bank governance trucktures to give civil society and the private sector a seat at the decision-making table. what can the u.s. do to ensure that civil society representatives are full and equal participants through the process? >> i welcome your question. let me just say it is very important to every that we are trying to do that the institutions understand that you are paying attention to and you care about this, and you will hold them to the highest possible standards that's necessary for us if we have any chance at being effective. now the president of the world bank, bob zoellick, has done a very effective job across the board making sure the bank is

better at not just measuring results, providing transparency, battling corruption, but in the specific case that you mentioned, making sure that through inspection panels under means that where you have large programs that have big impact on citizens on the ground in these countries, there's a chance for feedback and input as they shape the design ahead of the approval by the board. i'd be happy to have my colleagues provide you more detail in writing. of course, they have always been at the center of our negotiations in i.d.a. and around the world bank capital increase. the world bank sets the standards for the multilaterals, and part of the negotiations is make sure we are pushing the banks to adopt the higher standards. when the original banks are better, we push the world bank to get to the best frontier of practice. >> i think i have time for one more. last september the administration issued the first

presidential policy directive on global development. and the president made absolutely clear, the issue of the development policy is to promote growth, support developing countries, et cetera. and in accordance with the new policy, how is the treasury department making better investments in global development? why is it in america's interest economically to do so? and i think it's important that we review how treasury is working with other agencies, such as trade and development, u.s. aid, millennium challenge corporation, to ensure that all u.s. policies that contribute to the fight against poverty is good investment, debt relief, human rights, et cetera. perhaps you can answer that? >> thank you for raising that. again, let me just underscore

how important it is that people recognize that everything that matters in development, of course, depends on the actions of the governments in these countries. ultimately, most the resources they have available, are going to come not have us, but the world bank, to mobilize the country. that's why the emphasis on growth. so it's very important we are monitoring all of our tools and programs to expand economic growth that will create more resources for the governments. and ultimately, the countries like korea, for example, will be able to graduate from the programs and work on their own. now what this this -- what thisd strategy does is force not just treasury and aid, but the government to work much more closely together so that where we are acting, we are doing so in a complimentary fashion.

and the role we have, of course, is to make sure that through the imfs of the world bank, reasonablal banks in particular, and through our technical assistance and debt relief programs that we are getting the biggest impact at the least cost, mobilizing as many issues around the country. those are things it's hard for us to do bilaterally through a.i.d. as you listen to the secretary, he reminds me as an example, we want to make sure we are lending money, providing money, and make sure they have tax reforms in place to have reasonable effort to make sure the citizens are paying their share of being citizens as well. those are things you can only do effectively through the imf and the world bank where you have the capacity to impose broad conditions on economic policy. >> thank you. mr. diaz. >> thank you. i want to go back to two issue

that is you touched on before. one of them going back to -- you mentioned that the changes to cuba were minor. >> modest. >> they have contributed by helping prop up the regime, after that, there has been further crackdowns, death of a prisoner, hostage of americans, many of us believe the administration needs to get tougher. we also touched about that. that's not your policy area. however, you also talked about, i just wanted to mention that because i think it's pretty evident that it's not working. talking about jobs, you mention free trade. and you mention free trade with korea and others. i want to just briefly talk about the columbia free trade deal. for south florida and florida, columbia is a huge trading partner. for the united states, it's a huge trading partner. as a matter of fact, the united states was and i think continuing to be the number one

trader with columbia. since the free trade deal has not, sent forward, we have been losing market share. we have lost -- i don't have the numbers, but 50% of the market share from our agriculture products, a lot of that loss is to canada, and low and behold to china. they are always present. and they then subsequent to us negotiating the free trade deal, they have negotiated free trade with the european union. they are not exactly people that look at human rights and issue that is concern the united states. canada i already mentioned. the question is there, the president has stated publicly that he supports it. ambassador in columbia supports it. when i was in the swearing of president santos in columbia, president jones was the national

security advisor to the president said in the group of a meeting, it wasn't a secret thing, it's a meeting with the group of us, he said he thought it was a national security interest. specifically then, i keep hearing about what's holding up. but specifically, what are the specific issues, not in big term issue, and also more importantly, what are the solutions? when can we expect finally the president to move forward on that to present it to congress, because that's thousands of jobs that we could create immediately without spending one taxpayer dollar. again, if you could please address that issue, thank you. >> did you know that the responsibility for negotiating this with my colleague, ambassador kirk. you can tell you that he said publically, we are working very closely with the government of columbia at the president's direction to see if we can find a way to bring the agreement to the country to support. let me put columbia aside for a

sec and welcome everything that you said about making sure that we are finding ways to expand more opportunities in those countries for american exporters. because, again, when we are not there, when we are not there present, we lose business opportunity to other countries. we need to demonstrate to the world that we have the capacity to legislate for agreements that, you know, protect our interest, and again don't put us in the position of progressively losing more ground. :

>> that is something i want to leave to my colleague to explain, as you know, kind of delicate and we're trying to find something we can legislate. >> thank you, mr. secretary. >> thank you. talking about free trade,

north american free trade agreement created that, the united states created after that time the north american development bank. as you know it was created for the intent of helping to introduce a law in the u.s.-mexico border. there has never been a more difficult time for those communities ever. we all know it and see it in the paper all the time. i would ask you as we discussed earlier, isn't it timely that the north american development bank look at ways in which the bank can be more of a force for development? we have violence but it is also devastating to economy of mexico and border towns which also affects the border states? >> i think it is the right time to think about that. as i told i earlier today i would be happy to talk to my colleagues and come back to the staff with ideas how to do that. it underscores the value of these institutions. just as we think about in gnat bank context we need in afghanistan where we have

lives at risk as well and countries around the world where we face this tremendous opportunity to expand opportunities for american businesses. but i would be happy to, to work with you on how we can make sure that the nad bank is doing as effective job they can to helping to advance the issues. >> miss lowey. >> thank you very much. i know time is running out but i don't think anyone asked a about the gef the global environmental facility. i want to give you an opportunity. we know the global are environmental facility. reduces risk with changing environmental conditions, deforestation, when left unchecked lead to significant population displacement, declines in global food supply. major shortages of water. these are the very pressures of the chairman of the joints chief of staff, admiral mullen, noted, quote, could generate conditions that could lead to failed states and make populations

more vulnerable to radicalization. the gef takes on environmental challenges increasing caused by activities outside the united states but which negatively impact our environment and our economy. congressional budget justification states that the request of 143.75 million is consistent with our environmental and climate change priorities and that the u.s. was able to achieve important policy reforms the gef's effectiveness wroord to country-owned business plans and resource allocations. so, can you tell us in your judgment how does the fef help improve the environment, reduce global instability, increase national security and enincrease jobs in the united states. >> i can't improve on what you said. i very much welcome the role you played a long period of time helping make sure the u.s. can participate in

those important international initiatives. what i would like to say alongside the gef, take a careful look at climate investment funds. it is that package of requests that together, we think give us the best capacity to make sure that we're helping countries address the broader challenges brought by, by climate change, other environmental changes. and again i'll make the economic case too for it. you quoted admiral mullen. let me make the economic case for it. the world is going to be making major investments in energy efficiency, clean technology, also other things over a long period of time we have a very strong interest as a country making sure fund like this, we're not just leveraging other contributions from other countries but they're supporting, environmental policies, that, are, better from the u.s. perspective. so, i welcome your support for gef too but like the investments in long

bipartisan tradition this committee in supporting those fund. >> as long as you answered that so quickly i will take another couple minutes because i did want to follow up on our discussion about aid reform. there is example in cambodia ota is building to effective enhance budgets through mult did i donor initiativesly public financial management. we know this will go a long way to assure our aid dollars are effectively spent. however this great work, much to my surprise is being undone by your colleagues at the u.s. trade representative's office where they're levying cambodia with tariffs six times than what the u.s. provides in aid. so it seems to me that we should be helping countries use its own economic growth to address its problems, rather than taxing that

growth and then replacing it with a far smaller amount in aid. so hasn't our failure to think strategically and take a whole of government approach to development mean that we are taxing the very poor countries that we're trying to help? >> i hope we aren't but i'll be happy to -- >> you can check, how is treasury coordinating with other agencies to leverage its own efforts and insure economic returns? >> again, very important question. of course we should be looking what hand the government is doing while we help support these objectives. i'll be happy to pursue that particular question with my staff. but what you, what you highlight is really one of the very important example of, what we can do at very cost which is to put talented people in countries around the world who are trying to make sure that they can support reforms that will generate more resources for the countries

with less risk of corruption, with less fraud and less waste in that context. we have tremendously talented people supported by technical assistance programs you cited in cambodia but in afghanistan, in a whole range of other countries, again if you listen to our generals on the ground they can tell you how much of a difference those people have made in trying to make sure advancing our interests. again what we want to make sure is all the assistance we provide reaches the people it is designed to support and that requires that you have very tough conditions and tough reforms, against corruption and fraud and waste, alongside, the humanitarian assistance, the economic assistance we're providing and treasury's technical assistance program plays, has a terrific record in many countries around the world and we want to preserve the capacity to support those kind of reforms. >> want to say one other thing. obviously we're providedding a lot of aid to pakistan and there were efforts to raise taxes on those that could

easily pay the taxes but more than the politics could bear in the country. on the one hand we're trying to provide tactical assistance but it is pretty hard to overcome some of the powerful, forces let's leave it at that. >> exactly. people don't want to pay taxes but they're more likely to pay taxes if you make them more confident they're not going to be wasted by their government and that's why these reforms are necessary compliment we do even where the national security imperative is high and humanitarian imperative is strong. >> exactly. thank you for your important work. >> thank you, mr. secretary. this concludes the day's hearing. the record will remain open for members to schmidt questions for the record. the hearing is adjourned.

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>> the wisconsin state assembly has passed a bill previously approved by the state senate that eliminates nearly all collective bargaining rights for public workers. this part of yesterday's debate is a little more than a half hour. >> what's going to happen here today we're going to vote on this bill in the light of day. it is going to pass, and i know you feel passionate that this will ruin wisconsin and will make everybody take to the streets and wisconsin, as we know it will never be.

that is simply not true. it is simply not true. we here, on this side of the aisle, feel that if we don't get off the crash course that we're on right now, with the state of wisconsin, and with bankrupting our future and our children's future, that we're going to be in the wrong place. we ran on this. we were going to get the fiscal house in order. this is what we ran in our elections. this is how we picked 14 seats up from you guys. because you know what? you thought taxing your way out of a problem, pushing the problems down the road, increase government spending was the way to go. and that's okay. but it wasn't. the public spoke. they said no. no more. no more. we want you to go to madison and do what you say you're going to do.

and that's what we're doing today. this is the first piece of the puzzle. we're broke. we're broke. and out of that 60 hours of debate, i didn't see one amendment that was going to solve the budget deficit. i heard some people say, tax the rich. tax the rich. i saw a lot of delay tactics but i didn't see one serious effort to address the budget shortfall. $3.6 billion in the hole. we don't have any other options. these are tough decisions in tough times. but let me tell you, this is a pretty big political move for us as well and it is a gamble. the gentleman from the 78th is salivating. but you know what? we feel it is the right thing to do to get this

state on the right track. we feel it. as passionate as you are about this argument, we are on this side as well that this is the right move for wisconsin. that we are going to solve the deficit by cutting spending and not raising taxes. when we pass this budget, we are going to go from 3.6 billion down to 250 million only. and if there is any growth in the economy, you're going to see the state of wisconsin with a surplus for the first time in the 17 years. because we don't have any other options. and asking public employees to do modest things to pension and health care, to help us get through this, so we can avoid layoffs, go talk to other people. talk to the people in your district who have lost their jobs. 146,000 people without a job.

in the last two years. 60,000 people have lost their homes. i think they would take this deal. i know they would, because i've heard from them. i have heard from them in my district. i heard them calling from all around the state. now you know what? this debate here in madison, at the capitol feels one-sided. it does. there's lot of protesters. i get it. and, that's their right to come and protest and say we don't agree with you. but there are five 1/2 million people in this state and i can tell you i heard from a number of people who said, you know what? stick in there, hang in there. that's what you said you were going to do. you know what? people are more fed up with? they're fed up with republicans and democrats, saying one thing and coming to madison and voting a different way. fed up with it. and they're ready to throw all of us out, believe me.

so you know what? i heard from a number of people, we're going to give you republicans another chance. you say you're fiscal conservatives. let's see it. well that's what is going to happen. that's what is going to happen. ask for debate on the floor, yeah, gentleman from the 64th i am concerned. you know what? the protests have been very good. a lot of the people. i can take screaming and yelling in my face and drum beating, it doesn't bother me. but you know what i can't take? you know why i am concerned? the number of e-mails that we have received. permission to read from a printed document, mr. speaker? >> without objection. >> mr. fitzgerald, i want to make this perfectly clear. because of your actions today and in the past couple of weeks, and the group of people that are working with me have decided we have had enough. we feel that you and your republican dictators have to

die. this is how it is going to happen. as well as many others know where you and your family live, it is a matter of public record. we have all planned to assault you by arriving at your house and putting a nice little bullet in your head. however this isn't enough. we also have decided this may not be enough to send a message. so we have built several bombs that we have placed in various locations around the areas in which we know that you frequent. this includes your house, your car, the state capitol, and well, i won't tell you all of them because that is just no fun. i think you get the point. he goes on for two pages. so, the fact that the fact that you think that i shouldn't have any concern, and i heard from your side of the aisle that these

protesters, you know what? the protesters, i'm not lumping everybody into it but there are some people out there that have problems, definitely. and you know what? 99.9% of the people protesting out there wouldn't do this. but if it is one individual, i love this job, i love debating, with you i'm not going to risk anybody's life. i'm not going to risk anybody's life. and i hear let's adjourn. let's do it, it will all go away, right? adjourn for couple weeks and these are going to stop? no. no they're not. no they're not. so you know what? you guys did your jobs. the light of day has been shined on this bill. it's been over three weeks. it has gone you there process. you have done your job. i commend you on showing up and doing your job. if you should be mad at

anybody, should be the senate democrats. the senate democrats who fled the state. talk about lack of democracy. you know what? we're going to take up this bill. we're going to vote on it in the light of day. it's going to pass. and then you know what? i hope everybody gets home safe. that's what i hope for. but to act that there is no concern out there, or any safety concerns, it is simply not true. it is simply not true. so, mr. speaker, i know we've got a lot to do to get back to any kind of civility in this body. i get that. i get that. i get that, lady. but, this is something that is very passionate on both sides of the aisle. and something we feel we

have to do to put this state in a better place. thank you, mr. speaker. >> gentlelady from the 85th. hold on. gentleman from the 39th. >> one quick thing i like you vote not to remove me as speaker. thank you. >> lady from the 85th. >> thank you, mr. speaker. that is the issue on the table, is the removal of the current speaker. we will have time to get back to the bill and debate the bill but, i would urge all of the members of this body to give really close consideration to the resolution that is at hand. the resolution that i support. the resolution that is not taking a personal attack on the gentleman from the 39th but rather saying, what we have seen in the past few weeks shows mismanagement, and shows a failure of leadership. and that is what the question is about. it is a failure of

leadership to bring wisconsin to this state of chaos through decisions and priorities that were certainly ill-advised at best. i guess i think what we all should talk about right now, and we haven't done this lately is what we have in common, what we agree on. and the 99 of us, whether we have been here two weeks, two months, two years or 20 years, all managed to do the same thing. we all managed to convince the majority of the 55,000 we represent that we would come to the people's house. that we would come to this capitol. and although we would not agree on every issue, we would do our best to be their voice and represent the best interests of those individuals and those families and all of our communities. and the next thing that, i am very convinced we all share in common and many of us and many of you on the

other side of the aisle and certainly my colleagues have had this conversation with me, we have driven up to the capitol and as we walked into the capitol over those days, or months or years, have felt an incredible sense of privilege of doing this. we have sensed an overwhelming, emotional sense, of pride and humility, to do the work of the people in the people's house. and the reason we're having this resolution today, the reason we're asking for a change of leadership, is, we can approach this building, in that same way today. today, we have seen evidence of chaos, of the likes that none of us can remember, can recall, or ever will see again. today we have been, many of my colleagues, and i, and some of you, have been

actually brought to tears observing what we have observed. we have observed people, people working families, regular people, coming to this building adamant, emotional, passionate, about telling us what they think. about and i issue that they believe is going to change their lives and their families and their communities and they're locked out of this building. we have seen our very highly regarded law enforcement agencies, many from, i've seen officers from wausau today in riot gear. up and down the staircases and across the bridges and and around this building in rioter goo. we have observed members of this body locked out of the building. their face pressed against the glass and not admitted into the people's house to conduct their business. we have observed peaceful

protesters, orderly protesters, being dragged out of this building. and one of the most emotional times is when we observed a woman here from 8:00 last night, imploring to have the opportunity to speak to you about what she's concerned about, being removed in her wheelchair. ladies and gentlemen, members, please consider that what is going on in wisconsin is absolutely against every good idea, every good-faith effort. all of us pledged to bring to this body. we are saying that we have been alarmed by the ignoring of rules. we have been appalled by the egg green just conduct of business. we have been outraged over what is bordering on illegal

activity. but today, members, today, we are heartbroken. please, please, help all of us restore the reputation of wisconsin. help wisconsin regain its reputation of good, clean, government. help wisconsin once again become the state we are proud of, and the state we love. thank you. >> gentleman from the 69th. >> thank you, mr. speaker. mr. speaker, the motion we have before us to remove the speaker of this body is here for one reason. let's be honest. it's here because these cameras are here. it is the distraction. it is a delay tactic. and it is a gimmick of delay. we all know that.

even the media knows that. it is great theater. maybe you will get a story out of it. but, it is theater, mr. speaker, for the minority leader. he is good at it. the gentleman from the 64 this is very good at theater. but this motion before us to remove the speaker of this body is not only, i would argue inappropriate, it is pure political theater and nothing more. the fact is, mr. speaker, that our speaker did follow throughout every step of the process the rules of this body. screaming and yelling does not change that. our rules were followed throughout the process. and while some will say, and use interesting rhetoric

that is not the case, the fact is, mr. speaker, the fact is, mr. speaker, that the rules were followed. and let me give you one example. mr. speaker, permission to read from a printed document? >> without objection. >> thank you, mr. speaker. assembly rule 93. assembly rule 93 deals with special extended or extraordinary sessions. assembly rule 93 (3). a notice of hearings before committees is not required other than posting on the legislative bulletins and a schedule of committee activities need not be published. that is in the rules. you may disagree with the rules but i have just read the rules verbatim. the fact is, mr. speaker, that a two-hour notice was given. members were notified via e-mail. and also, mr. speaker, that notice was physically brought by a member of the speaker's staff to the

minority leader's office, hand delivered. so, again, great theater saying we didn't know. we were surprised. simply not true. because the facts are the facts and the rules are the rules. so, mr. speaker, this is a distraction but i will say this. it is serious in this regard to try to remove the speaker of the assembly, this assembly or any assembly or the president of the united states. people back home are shaking their heads. but i want the people back home and our members want the people back home to know, once again, like the speaker stated, we had the longest, continuous debate on this bill in state history. 60 plus hours. we had the longest public hearing before the joint

finance committee in history. 17 hours of testimony. 1,000 public members speaking. so, mr. speaker, the fact is, the speaker of this body allowed for that debate. allowed for those 60 plus hours of debate and motions and discussions. speaker of this body allowed for that joint finance process, to continue 17 hours. mr. speaker, the speaker of this body didn't have to but he did because he believes in transparen is. he believes people have a right to make motions, to talk. and while the state senate democrats did not give the body that ability because they ran away, i will compliment the assembly democrats in this room, who stayed here for 60 plus hours. who were at the joint finance hearings.

but to say, somehow we were surprised and we don't know why we're here and that for that reason, or there was illegal activity and for that reason we need to remove the presiding officer of this body and the speaker of the state assembly, is just simply political theater. that is all it is and we all know it. . .he said, when public employees are denigrated or villified or their rights are infringed upon. we need to attract the best and the brightest to public service. these times demand it. again, i thank the gentlelady for coming forward. and i yield back the balance of our time. the speaker pro tempore: the gentlelady yields back her time. under the speaker's announced policy january 5, 2011, the chair recognizes the gentleman from illinois, mr. jackson, for >> of course. but i will say this. four hours from now we will call

up for the vote. two hours from now, we will call for the vote. that is public notice. so we are going to vote on this bill, today, mr. speaker, and while some don't want to. i understand that, and i respect that. we are here to vote, we know why, we have gone through 60 plus hours of debate, 17 plus hours of testimony. we know how we are going to vote, now we know we are going to vote in two hours. mr. speaker, that is not an easy decision that any of us are making. this has been an extraordinary difficult process, democracy is in the always easy, and sometimes it's not always pretty. i will tell you that democracy has taken place here, people have had a chance to comment, people have had a chance to make motions in this body, maybe not in the state senate, mr. speaker, we know why we are here. our goal today is to have a civil debate on the bill over the course of the next two

hours. our intention is to have a vote in the light of day, mid afternoon, for everyone in wisconsin to see. that is what we are going to do today, mr. mr. speaker, on this motion, i am asking this body to republican and democrat vote down this motion because you know this is inappropriate, and you know it's theater, and it is the right thing to do to remove an officer of this body for these cameras is wrong. so let's get rid of this distraction, let's vote it down, let's move on. two hours from now, we are going to vote on this bill. thank you, mr. speaker. >> i apologize, mr. speaker, i was in my office answering questions from investigators from the d.a. about the violations of the open meetings

law. otherwise, i would have been here back in the body. this bill has a cloud. it has the largest, darkest cloud floating over it that you can even imagine. and the gig is up. the charade you've been pulling on the people of wisconsin is over. with this bill, they know now this is not a budget repair bill. it doesn't fix the budget. telling people, i'm sorry, i've had the take away the rights that you've had for 50 years, i'm sorry perhaps this will hurt our middle class in wisconsin, i'm sorry i would rather not do this, but we have to fix the budget. you need to send a new e-mail out. that's no longer why i voted for this bill. it no longer fixes the budget. you might have been telling

people, the governor said we have to lay off 1,000, 1500 people if the bill doesn't pass. you have to now tell them, sorry, the governor may still lay people off. binding isn't in the bill. this doesn't fix the budget. the speaker was completely wrong. we did give you an alternative that completely fixes the budget without resorting to the extreme radical ideas that are in this bill. so permanently take away the right that started in this state 50 years ago to collectively bargain. because the rest of this is pretty much not going to fix the budget. i know we still have to end the cronies for the governor. that doesn't fix the budget. i know you want to give him his cronies, that'll take place. still give him the super powers

to ignore the law for the first time in history, we have a governor that can ignore dozens of laws just be issuing emergency rules for an emergency that doesn't have to exist. i believe the no big contracts are in here. but it's part of that cloud that's over us. because it's not clear if it's no here. in fact, i'd like to ask the gentleman from the 69th or the gentleman from the 30th, whoever actually has read the bill, and knows how it was drafted, maybe they can tell us and explain to the body, if, in fact, the contracts are in here. i've gotten a couple different answers on that. last night when i went to the conference committee that was given the 44 page summarize, i wasn't able to quite reach fast enough to know that. of course, i asked the conference committee chairman, mr. chairman, i said, would you

please at least explain what's in this bill? and, of course, in the arrogant fashion not even explains, look, it's the same thing i debated before. okay. it's the same thing. expect he took some things out, he said. really will you explain that we have director lane explain what was taken out so i know how to vote on this bill? guess what the answer was? no! no, we're not going to explain what's in this bill, you have to vote. amazing, isn't it? i'm sure many of you are made, because i heard you endlessly talk the last couple of years about having time to read the documents in front of you, i was given three minutes. now if you think that's okay, then that is terribly

disappointing. three minutes. i was given no chance to raise a point of order. no chance for the inquiry of the chair, no chance that the law was being violated, they took the vote while i was reading. attorney general van hollen's position on open meetings. that's the abuse of power. but i don't know. i can honestly tell you i don't know if no big contracts are still in here. it's not clear to me. our staff thought there was some change that occurred. now i'm not sure if there was a change in the drafting or not. i'd like to know. there was a huge cloud over the bill. that i can assure you. there was a huge cloud because you had almost 1/3 of the people disenfranchise when it passed the bodty. -- body. there was a cloud in the meeting

law, this was a cloud, and i'm going to ask the gentleman from the 19th to explain two points of order on this very bill. there was a cloud. you are voting with a giant storm cloud above your head. the charade is up. this is not a budget repair bill. it doesn't fix the budget. all it does is take away worker rights forever. to solve what you said was a temporary problem. all it does is give the governor a dozen new political cronies. all it does is have big new contracts. all it does is give the governor unprecedented authority to ignore dozens of health and human service laws. those are the main points you are now voting for. please, don't insult your constituents when you go home tonight, if, in fact, you vote for this and tell them you repaired the budget. because you didn't repair the

budget. all you did was take away people's rights, trample on democracy, and insult the people by giving the governor new political cronies. i'd like to ask the gentleman from the 1th -- 19th to yield. i understand you have two points of order. could you explain? >> he yields. i'd be happy to answer your question, gentleman from the 54th. i do have two points of order i'd like to raise, mr. speaker. this bill is not properly before us. i'd like to ask unanimous consent to reprint documents before us. >> without action. >> the bill is not before us because of the state section of the institution. this is for two reasons, first, the conference reports changes appropriations, requires major lapse of the fund, and several

cites to chapter 20. secondly, it is not before us because it has changed from last night until today. i'll explain. on the first one, there are changes to appropriations, lapses, and chapter 20. let me give you some examples, mr. speaker. there are five straight pages of chapter 20 references on pages 18, 19, 20, 21, and 22. on page 59, lines 23 to 24, there is a deduction, rather than a credit than impacts tax revenue. on page 58, line 21-24, there's lines referencing districting, which are tax and financing districts. definitely a fiscal item. on page 31 and 32, there are four separate lapses to the general fund. and on page 132, you decrease appropriations by $37 million.

on the second point, mr. speaker, we received from the legislative fiscal bureau today an extraordinary memo. i'd like to pull from that memo. there are two items that were in the lsd's march 10th document, the document that we have before us today that are not reflected on the march 9th document, the document that was voted on yesterday. the first item is on march 10, it includes a division on the substitute amendment on the earned increase tax credit. page three, item one. the second item is that the march 10 includes a provision of the substitute amendment on the sale and state owned power plants. that's located on page 20, item one. so, mr. speaker, for the foregoing reasons, i ask that -- i would like a formal written opinion from you delivered to

every member of this body and entered into the journal of this body on your ruling. on whether the bill was properly before us. i do not believe it is properly before us. i hope that you can make a speedy decision, say it isn't, and we can adjourn and do this -- this is the wrong way to do doing this, mr. speaker. i'm opposed to the bill. i'd be voting no. i voted no a couple of nights ago. this is the wrong way to do this. we are breaking the law and out of respect for the state constitution, mr. speaker, i'd ask you to make a formal ruling and make it as long as you can, thank you. >> the speaker -- you know, i keep asking myself why? why would people be supporting a

measure that poll after poll shows 2/3 of wisconsinites oppose. why would you when all that is before you of great significance is taken away workers' rights. every poll shows that 2/3 of wisconsinites are against it. i ask them why in the world would they will being to vote for that. it's confusing to me. i learned from my staff apparently wednesday, senator fitzgerald was on fox news and said that stripping workers' of their fight was a big part of the effort to help to see president obama in wisconsin. maybe that's it. maybe it's senator fitzgerald, not speaker fitzgerald that has come up with the grand scheme that you can beat president obama in wisconsin. strictly by stripping people's rights, and passing a bill that clearly the people don't support. and, in fact, the polls show people no longer support your

governor either. governor walker no longer has support of people. because of these extreme radical ideas. it's not my words. it's the radical idea was senator luther olson called it radical. and it was radical. it's going to hurt the middle class and you know it. if the budget continues along with that, we are going to really decimate education in wisconsin. nearly $1 billion in cuts to p5. 30% cuts in vocational colleges. if there's one thing you could do to hurt the long-term economic impact of this state, it's pass all of those budget measures to destroy education in wisconsin. our priorities are so far off it is so far off that it just is absolutely astounding me. i just hope when it comes time

for final passage, whenever the speaker decides that democracy is over for the day and we are going to cut off debate, i hope you'll think about the fact that you are no longer fixing the budget, that's a charade, and that you shouldn't take away people's rights permanently. so, mr. speaker, thank you very much for indulgence. if you could rule on representative from the 19th point. that would be helpful. that dark cloud worries me enormously. >> and the wisconsin assembly passed that bill 53-42. the bill eliminating nearly all collective bargaining right for public workers just a short while ago. wisconsin governor, scott walker, signed that bill. he do so in private, accordinged to the "associated press" and planned an afternoon news conference in the capitol. president obama also planning a news conference in the white house. that's set to get under way at 12:30 eastern. among the topics we certainly

will hear about the tsunamis warnings on the west coast, and the waves striking california and oregon, and president's news conference at 12:30 eastern. in just a bit, we hope to take you live to the united nations, ban ki-moon will be talking. that news conference is set to get under way in just a couple of minutes. we'll have it for you live when it does start. the associated press is reporting that the european union said a while ago that any military action to protect the pollation -- population needs u.n. backing. again, we will let you know when it starts and we will have it for you live here on c-span2.

[inaudible conversations] [inaudible conversations] >> again, we are waiting to here from ban ki-moon, and the special envoy to libya. it's also possible we'll hear comments from ban ki-moon on the earthquake and tsunami in japan. he said they will do everything to help japan. we'll have that live on c-span2. in the meantime, anita in "washington journals" he's the ranking member on the subcommittee that covers foreign operations. >> host: thanks for being here. >> guest: my pleasure. >> host: wow, we have a lot going on today. i'm going to start with libya just because the secretary was talking about it.

again leaders why europe are meeting, france is pushing for a no-fly zone. what are your thoughts about the u.s. involvement level? how big should it be? and why is that a good investment for this country? >> guest: it's clear to me after discussing it in depth with secretary clinton is the administration is actively involved in strategy sessions and discussions with the international community. the united states cannot act independently. and people may say no-fly zone, they may say -- they may come up with all kinds of actions, but number one, there are implication implications as secretary gates said to every one the proposals. unless we act with the international community, i don't think it would be effective for us to take any action by ourselves. we have spoken out publicly, it

is absolutely a -- appalling that a leader is shooting and killing his own people. i hope there's consensus in the international community. >> host: we were guessing that the big story would be saudi arabia for it's first day of rage. we heard there might have been government shots fired into the crowds, but it's all been ellipsed by japan and the earthquake followed by the sue -- sue -- tsunami there. you just came back from japan? >> guest: i just came back from japan. they have been an active ally, and regional talks which is essential. this is devastating. when you read the reports after you just met so many members of

the diet and their leadership and you've been in their homes and had such in depth discussions for three or four days. to see it happening, is devastating. japan is probably one the most organized places i have ever visited. the streets are clean, the people are polite, there is a plan for everything that has to happen. and i know that they have been preparing for a possible earthquake or tsunami for a long time, but preparing for it, and then responding when the tall buildings are shaking and people are losing their lives, hopefully the lives lost will be kept to a minimum because of the preparation. >> yeah, this is also a domestic story. we've told you earlier that the waves are beginning to reach the coastline in hawaii.

and it is scheduled to do so right now as we are speaking. viewer just tweeted to us that oregon's north coastal areas are being evacuated. twitter is great for all of the local reporting on this. >> guest: isn't that amazing? >> host: watching all of the roads on tv. so weird says the viewer. i want to get back to why we are here, foreign aid spending. an example of japan, when something of the magnitude hits, as it did in haiti two years ago, the international community, the united states gets involved. we send resources and aid. how do we budget for that federally for the unexpected natural disasters? >> guest: first of all, i want to make it clear to all of viewers that the foreign aid budget is 1% of our total expenditures. and i agree with many of the new members of congress that we should be evaluating every program, cutting waste, fraud, and abuse, and certainly there are programs that may not be as

efficient as others. and even in the foreign aid program, when i was the chair, and now ranking member, we have worked together in a bipartisan way to make sure there's appropriate oversight. we are sending billions of dollars to afghanistan, spending billions of dollars in pakistan, for example. the total budget, though, is only 1%. and when there were stories, i happened to get a beeper on my blackberry about the $3 billion that was on a pallet going from dubai to afghanistan. i immediately held up all of that money until we came to a conclusion and an understanding as to where that money came from and where it was going. so we provide excellent oversight on our foreign aid budget. and we still can do more. because we have found problems with it. but it's minuscule. and when you see what happened

in japan who doesn't get foreign aid, they do not get foreign aid. but in disasters, such as happened in haiti, we can respond and we do respond, number one, it's in the -- >> part of this morning's "washington journal" we're going to take you live now got united nations. secretary general ban ki-moon with the representative from libya as well. >> joined by my special envoy to libya. as you know, he has served twice as foreign minister of jordan, and he's now serving as the senator of jordan. we have just a concluded very detailed discussions concerning the full dimensions of the crisis in libya and the role he will play. as the former minister of jordan, he brings to the job a

seasoned understanding of the dynamics of the region, and the wealth of experience. this is critical and demanding assignment. and i'm grateful to him for taking it on. our most immediate challenge is humanitarian. with each day, the death toll mounts, and the situation of the libyan people grows more desperate. we have all seen how the fighting as escalated, civilians have bourn the front of the violence, increasingly they are being targeted. my message having strong and consistent. the violence must stop. humanitarian aid must get to those in need. those response for violence against the civilians will be held accountable. a peaceful resolution must found. that is why i have deciding to disbatch my special envoy to

libya soon. he will depart from new york, joined by a team that includes senior humanitarian officers, as well as a staff from the department of political affairs and the office for human rights. they are expected to arrive in tripoli very soon, early in next week. the object will be to assess the situation under ground and under take conner isations with the libya on the immediate humanitarian, political, and security situation. i have instructed my special envoy to convey in no uncertain terms the concerns of the united nations and the international community as expressed in the security council resolutions. my special envoy will report back to me as he continues his work. he will need to consult with the libyan authorities and other

parties, as well as with the neighboring states and regional organizations on how best to resolve this issue. yesterday i met with the members of the security council who informed me that are continuing to engage fully on the issues, both to ensure the implementation of the security council resolution 1917, as well as to consider next steps. for my part, i have been concerting very wisely with war leaders, focusing chiefly on libya, but also wider challenges in the region. in every conversations, at every opportunity, i have urged leaders to listen to the voices of their people, to heed the at -- the aspirations for change and toward the better future for dialogue and democracy.

i'll be in the region myself later next week. when i intend to visit egypt and tunisia. just before that, i will confer with the leaders in central europe. i'd like to introduce my special envoy. >> thank you very much. i want first to thank the secretary general, mr. ban ki-moon for his trust and confidence in me in choosing me for this delicate and crucial mission. i accepted the secretary's office with the hope that i will contribute positively in the effort in libya to overcome the economic crisis. i understand the complex nature of this task and the gravity of the situation on the ground and i start my mission hoping that this effort that i understand take on behalf of the international community will succeed in stopping the killings and ending the suffering of the civilian population in

addressing their humanitarian needs and in preserving the unity of the libyan people and integrity of their homeland. achieving these goals is essential for enabling the libyan people to choose their future and determine their destiny. i look forward to the cooperation with the secretary general under his leadership as well as with member states. i will commence as soon as possible my contact and consultation with arab groups in order to coordinate the international effort in assisting the libyan people. and i look forward to team work and full support by secretary general. thank you very much.

: >> speak speak tone >> [speaking in native tongue]

>> [speaking in native tongue] >> wednesday morning i had a telephone talk with foreign minister of bolivia, and we discussed my intention of dispatching mr. ilah khatib. his visit for the exact duration of his stay, we'll have to see. i'm not quite sure, but i expect he'll be there for several days meeting with government officials and other necessary people. that is not yet sure. then he will come back and brief

me in the region while i'll be traveling in tunisia and egypt. then we will discuss further steps of his work. >> yes. you said that the main purpose at the moment is humanitarian, but to what degree do you see this, also, as a political role as taking a central position in terms of trying to mediate any political solution like a cease fire or whatever, if i could get response from both of you, please. >> he's a special envoy of the secretary general to libya. at this time we expect that we need to take urgent action to stop all this violence. this has very serious humanitarian implications, so he will focus on putting an end to this violence, but i expect that

he will be engaged in the broader dimension of this crisis including political issues. >> will mr. kratib with meet with the op cig government while he's there? -- opposition government while he's there? >> i'll try to learn as much as possible about the situation on the ground, and i am prepared to meet all parties concerned, and i think that is essential to know the views and positions of all parties. >> thank you, mr. secretary general. would you call for a cease fire to allow humanitarian aid for the civilians in many parts of libya, and have you had any contact with their provisional counsel in benghazi? thank you. >> my message has been consistent and clear that violence must stop. let the humanitarian workers do

their work to help those people in need. we will see what kind of a course of action we will take after his visit to libya. >> have you contacted the provisional council? >> no, i have not. >> have you considered the council a legitimate representative for libyan people? >> the recognition of this council or any government is the matter to be determined by the member states of the united nations. >> last question. >> secretary general, there is a lot of talk by prominent u.s. senators and from other countries, too, about sending rebels -- weapons to the rebels in rib ya. are you -- libya. are you worried this will

violate sanctions? >> again, i understand the negotiations include the u.n. security council. they are discussing broad range of options for next steps. but this is up to the member states of the security council to determine future course of action. [inaudible conversations] >> what about jordan itself? >> secretary general's comments as the european union in brussels is saying they're keeping the military option open, but that it would have to be approved by the united nations. it's likely we'll hear more about libya with president obama who has a news conference scheduled for 12:30 eastern. certainly more about the situation on the west coast due to the japan earthquake, the tsunamis began coming, the waves began coming ashore about an hour ago, about 7:30 eastern.

the president's news conference coming up in just under an hour at the white house. we'll have it live for you here on c-span2 at 12:30 eastern. ahead of that, though, back to our discussion on the foreign operations budget. this morning's "washington ran journal." >> host: thanks for being here this morning. wow, we've got a lot going on today. >> guest: my pleasure. >> host: i'm going to start witi libya just because the secretary was talking about it. again, leaders in the europe are meeting, france is pushing for a no-fly zone. what are your thoughts about the u.s. involvement level? how big should it be, and why is that a good investment for the country? a >> guest: it's clear to me after discussing this in depth with secretary clinton that the administration is actively involved in strategy sessions, in discussions with the international community. the united states cannot act independently.te and people may say no-fly zone, they may say -- they may come up

with all kinds of actions, but, number one, there are implications as secretary gates said to every one of the proposals. and unless we act with the international community, i don't think it would be effective fork us to take any action byr us ourselves. we've spoken out publicly, it is absolutely abhorrent that a leader should be killing his own people and shooting his own people, and i hope there can be some consensus from the international story. >> host: we b were anticipating. the big story out after that region today would be saudi arabia, we heard some reports that there might have been some government shots fired into the crowds as they were assembling last night, but it's all been eclipsed by japan and the earthquake followed by the sue nameny there. -- tsunami there.

youd were telling me you'd just come back from there? >> guest: i've just come back from japan as part of a congressional exchange program. they are a good ally, they have been an active member of theof six-party talks in the region which s is so very essential, ad this is just devastating. and when you read the reports after you just met so many members of their diet and their leadership, and you've been in their homes and you've had such in-depth discussions of three or four days to see this happening is just devastating.ning japan is probably one of the most organized places i haveone ever visited. the streets are clean, the people are polite, there is a plan for everything that has o s happen, and i know that they have been preparing for a possible earthquake or tsunami

for a long time, but preparing for it and then responding when the tall buildings are shaking f and people are losing their lives, hopefully, the lives lost will be kept to a minimum because of the preparation. >> host: yeah. this is also a domestic story.th we've told you earlier that the waves are beginning to reach thc coastline in hawaii, and it is, it is scheduled to do so right now as we're speaking.o and a viewer just tweeted to us that oregon's north coastal areas are being evacuated. twitter is great for all thebe local reporting on this. >> guest: it's amazing.r >> host: narrow little roads onr tv, but i want to get back to why we're here which is to talk about foreign aid spending. let's just use an example of e japan. when something of that magnitude hits, the international community -- united states asna well -- gets involved. we send resources, we send aid. how do we budget for that res

federally for these unexpected natural disasters? >> guest: first of all, i want to make it clear to all your viewers that our foreign aid budget is 1% of our total expenditures. and i agree with many of the nef members of congress that we should be evaluating every program, cutting out waste, fraud and abuse, and certainly there are programs that may notu be as efficient as others. and even in the foreign aid program when i was the chair ann now ranking member, we haveogra worked together in a bipartisan way to make sure there's appropriate oversight. we're spending billions of dollars to afghanistan, spendina billions of dollars in pakistan, forf example. the total budget, though, is only 1%.tal and when there were stories -- i happened to get a beeper on my blackberry about the $3 billion that was on a pallet going toab dubai from afghanistan, and i

immediately held up all that money until we came to a conclusion and an understanding as to where that money came from, where it was going. moneym and where it was going. we provide excellent oversight on our foreign aid budget and weekends to do more because we have -- and we can still do more. when you see what happens in japan, they do not get foreign aid. in disasters such as what happened in haiti, we can respond and we do respond. number one, it is in the interest of the national security of the united states to respond to disasters. we know that when communities and countries in turmoil -- this can cause tremendous action on the part of terrorist

organizations such as al-qaeda recruiting people who do not have food, clothing, or clean water. i think it is important to remember 1% of the budget. our national security depends on defense, diplomacy, and our budget. host: i want to put a set of numbers on the screen and then go to your telephone calls. we are going to be out early today because house will be in session a half hour from now. the present for this fiscal year requested $56.7 billion. the amount suggested in the continuing resolution by the house, $45 billion. you have been speaking saying that is shortsighted. guest: number one, our national security, the united states of

america depends on defense dollars. those are being cut, too, but not in proportion to foreign aid. defense, diplomacy, and development. turmoil, terrorists -- they find a very for tile soil when they are in communities that are lacking the basic essentials of life. it is in our interest. secondly, we are amoral society. ithere are many people who support foreign aid because they understand it is important to help people whether it is hiv aids, malaria, drinking water. i have been to some countries where family planning is not adequate, and women who can barely support their children are having a ninth or a tent child. it is in the interest of the united states. we are a society that believes

we have to be helpful to others. host: one last article and then to your calls. the treasury secretary has been on capitol hill trying to make the case for maintaining funding levels for key foreign aid programs. here is the headline. pay. funds for development banks are a prime target in their quest to slash the federal budget. they're $61 billion in proposed cuts include almost two-thirds of washington's three billion in commitments to development banks and funds. secretary geithner, treasury secretary, recently said in congress at the world bank failure to finance the capital increase would lead to the loss of u.s. power to veto changes, veto changes to the governing agreement. the remarks show that even cuts to the contributions for

international banks that few americans have heard of will come at a price and may be hard to sustain. under the republicans' plan, the u.s. would not fund the $106 million in new capital for the asian development bank this year and would make none of its promised contributions to a range of u.n. and world bank funds for the environment and food security. that's heart of the discussion with ms. lowey, member of congress from new york. let's get to your telephone to calls. first up, kathy, republican. go ahead, please. >> caller: hi. i just want to tell the representative that my feeling is that we should have absolutely nothing to do with the libyan conflict. the best thing we could possibly do is have the president of our country stand up and publicly state that the european union and the islamic countries need to solve this. i don't really give a damn. anymore whether we are humanitarian or whatever we area

this isn't our fight. i have a son in the united states navy, he is in the enterprise battle group. he is currently deployed, and the last thing i want to haventy happen is him standing off the coast of libya and our blood and treasure going to something thab is not our fight. >> host: thank you, kathy. >> guest: and thank you, kathy, for your eloquence and, please, god, i hope your son will come t home soon. but we have to understand thate are not living in isolation. and i want to go back to the article that susan read about the ba made focused like a laser beam in our country on jobs. that is what we should be doing, creating jobs and putting people to work.

the banks, by creating markets overseas, by investing in development and training and working in partnership with other countries, creates jobs because our exports to these countries are increased. it is not just because we are good people, also we are. it is in the national security interest of the united states, and when a disaster occurs, we have an obligation to be helpful. i know we will as we have been in haiti and responding to other disasters. host: next is its duty, an independent. -- next is judy, an independent. caller: i see some money going out for [unintelligible] things like that. i see a lot of money going up for military aid to governments that are not necessarily too

nice to their people. i would like to know the proportion of military aid we are sending to actual humanitarian aid. guest: that is a good question. it is about 20 times or more. i happen to agree with you. secretary gates and general petraeus and admiral mullin have made that point very well. we see in afghanistan that the civilian aid is absolutely essential to resolving this conflict. we are putting many, many billions more dollars in the defense program then in the civilian side. i think that has to be changed, hopefully in my lifetime. host: good morning. caller: i am from westchester county. hello.

i would love to have a town meeting with ms. lowey so we can look eye to eye so we do not have to be on the telephone for 40 hours to ask a question. howl are our national interests involved in helping women have babies in other countries? how does that help our national interest? the other two ladies -- we are involved in other countries, giving money to their military. a couple of years down the road, they are knifing us in the back. we have to stop giving all this aid to governments and let them figure out what they want to do. for heaven's sakes, it is not in our national interest to give money to people to stop having babies in the third world

countries. we have to help our own citizens. that is all i would like to say. maybe one of these days, which will have a nice, big town hall meeting where mrs. lowey is actually there. guest: i have been in office for 22 years. every year, i go to the supermarkets, libraries, office hours, and please call my office. you do not have to wait for a great, big meeting. i would be delighted to meet you one-on-one. i think it is important to know that we do not live in isolation. we are all connected. in the days of one part of the world and not getting to the other part -- what happens, be it in japan or china, what happens in afghanistan, pakistan, is certainly relevant

to our own security here. i mentioned the banks before because i am very concerned about jobs in west chester county. i have worked hard to get fda loans so we can help businesses expand. in terms of international assistance, again, we export to japan. they export to us. we export to china. we are all interconnected. when there are asian flus, they are exported as well. i would be happy to talk to you further. host: we are trying to give you some news updates on the earthquake and tsunami as we talk here about these federal spending priorities. this is a sad story. as many as 300 bodies have been

found in one city. the next telephone call as we talk about foreign spending with congresswoman nita lowey. this is a real personal story for her this morning. caller: i just want to say that i believe in giving foreign aid to people because people around the world need the help. a lot of the money goes to governments that keep it for themselves. as i was growing up as a kid, [unintelligible] i think they need to do a lot more in this country. thank you. guest: and thank you, sir. i do want to say that a good deal of our aid is delivered to organizations like save the

children who are working with families and villages. there is a small group in guatemala, for example, that is training people to make products such as pocket books so they can sell them and support their own families. let's remember, again, we are living in a global economy. we are living in a global world it. if there are diseases abroad, they can come here. if there is a disaster abroad, because of the good nature of the people of the united states of america, we do want to assist as in haiti. i do want to say that mexico, which is right on the border of texas, we may be assisting and training their police force and their military, but it is in the interest of the united states of america keeping us safe here to help those in mexico.

host: how is your working relationship with the new chair? guest: she is a delight. she is from texas. now she is chair and i am the ranking member. and maybe the only committee with two women. host: you feel that even though you have different priorities for spending, you can find consensus? guest: there is no question. many of our priorities are the same. we are looking to the whole budget to make sure every dime is spent effectively and there is no waste. the gentleman talked before about giving funds to the people rather than the government. corruption has been a big issue for me as it has been for secretary clinton. recently, when the president tried to raise taxes, there was a mass demonstration. frankly, if we are giving all of that aid, there should be many

more people paying their taxes especially at the top level. host: the next call is from new york. good morning. caller: i should probably say i am a tea party member more than a republican. i think andrew cuomo is doing some very good things for the state. i am so mad at the entire congress. our debt payments are larger than the state budget. we are destroying this country with the massive level of debt we are piling up. neither party is willing to do anything. one party is offering a third of a percent. while we are racking up debt at exponential levels. guest: let me say, number one, i have known in drew, since he was a kid. he lived to run the corner from me in queens. i am very proud of him and i

think he is doing a good job. secondly, i happen to agree that we have to tackle the debt. i am opposed to the $40 billion in subsidies to the oil industry. there are many special cause outs for large corporations and businesses that we have to attack. there has been major assaults on appropriations and earmarks. i have always said that you have to be careful when you provide a legislative director of it earmarked. no one is looking at the special giveaways. i think we have to do a lot more because addressing the debt is essential n. but you cannot do it with a sledgehammer. with ave to do it in scalpel. teachers would of been laid off. the programs would of been cut. title 1 programs would of been cut.

money to the national institutes of health providing research for cancer, alzheimer's, diabetes, wouldn't been cut. i am hoping we can come to some bipartisan solution in the senate so rationality will prevail rather than this hammer approach of cutting. host: from twitter -- guest: let me say that there has to be a balance because we provide a lot of money, if you are talking about haiti, to the non-governmental organizations. there are over 10,000 of them in haiti. they are there to deal with humanitarian services to help build better schools. unless we train the government,

unless we work with the institutions, i am very concerned that we are not going to accomplish what we really have to do, and that is removing ourselves. the non-government organizations cannot be there forever. the institutions have to train to deliver the services. what want to see if we want to develop communities outside of port-au-prince, i want to see what i call a community of learning, a school at the center of the community, and around that, job opportunities. a big career inferred just announced they were going to have a business in it -- a big korean firm just announced they were going to have a business in haiti. the purpose of foreign aid is to help people help themselves. host: our next call is another

new yorker, william, a democrat. caller: i would like to suggest several reasons why the the eight budget should be cut. the d.a. has offices in 63 countries and that is way too much. the second reason is [unintelligible] medical marijuana [unintelligible] something that congress is lagging behind with sentiment on this issue. i think this is something that needs to be cut. i think the people need to question its such as the congresswoman. guest: thank you, sir. i would say to you that the legalization of drugs is a debate that we really have to have. certainly in mexico when you see the drug cartels that have