[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]

U.S. POLICIES AND PROGRAMS FOR
GLOBAL DEVELOPMENT: USAID AND THE
FISCAL YEAR 2011 BUDGET REQUEST

=======================================================================

HEARING

BEFORE THE

COMMITTEE ON FOREIGN AFFAIRS
HOUSE OF REPRESENTATIVES

ONE HUNDRED ELEVENTH CONGRESS

SECOND SESSION

__________

MARCH 3, 2010

__________

Serial No. 111-83

__________

Printed for the use of the Committee on Foreign Affairs

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

______

U.S. GOVERNMENT PRINTING OFFICE
55-271 WASHINGTON : 2010
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing Office,
http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center, U.S. Government Printing Office. Phone 202�09512�091800, or 866�09512�091800 (toll-free). E-mail, gpo@custhelp.com.

COMMITTEE ON FOREIGN AFFAIRS

HOWARD L. BERMAN, California, Chairman
GARY L. ACKERMAN, New York ILEANA ROS-LEHTINEN, Florida
ENI F.H. FALEOMAVAEGA, American CHRISTOPHER H. SMITH, New Jersey
Samoa DAN BURTON, Indiana
DONALD M. PAYNE, New Jersey ELTON GALLEGLY, California
BRAD SHERMAN, California DANA ROHRABACHER, California
ELIOT L. ENGEL, New York DONALD A. MANZULLO, Illinois
BILL DELAHUNT, Massachusetts EDWARD R. ROYCE, California
GREGORY W. MEEKS, New York RON PAUL, Texas
DIANE E. WATSON, California JEFF FLAKE, Arizona
RUSS CARNAHAN, Missouri MIKE PENCE, Indiana
ALBIO SIRES, New Jersey JOE WILSON, South Carolina
GERALD E. CONNOLLY, Virginia JOHN BOOZMAN, Arkansas
MICHAEL E. McMAHON, New York J. GRESHAM BARRETT, South Carolina
JOHN S. TANNER, Tennessee CONNIE MACK, Florida
GENE GREEN, Texas JEFF FORTENBERRY, Nebraska
LYNN WOOLSEY, California MICHAEL T. McCAUL, Texas
SHEILA JACKSON LEE, Texas TED POE, Texas
BARBARA LEE, California BOB INGLIS, South Carolina
SHELLEY BERKLEY, Nevada GUS BILIRAKIS, Florida
JOSEPH CROWLEY, New York
MIKE ROSS, Arkansas
BRAD MILLER, North Carolina
DAVID SCOTT, Georgia
JIM COSTA, California
KEITH ELLISON, Minnesota
GABRIELLE GIFFORDS, Arizona
RON KLEIN, Florida
VACANTWexler leaves 1/4/
10 deg.
Richard J. Kessler, Staff Director
Yleem Poblete, Republican Staff Director
Jasmeet Ahuja, Professional Staff Member deg.
David Fite, Senior Professional Staff Member deg.
Jessica Lee, Professional Staff Member deg.
Alan Makovsky, Senior Professional Staff Member deg.
Pearl Alice Marsh, Senior Professional Staff Member deg.
Peter Quilter, Senior Professional Staff Member deg.
Edmund Rice, Senior Professional Staff Member deg.
Daniel Silverberg, Senior Deputy Chief Counsel deg.
Amanda Sloat, Professional Staff Member deg.
Kristin Wells, Deputy Chief Counsel deg.
Shanna Winters, Chief Counsel deg.
Brent Woolfork, Professional Staff Member deg.
Diana Ohlbaum, Senior Professional Staff Member
Laura Rush, Professional Staff Member/Security Officer deg.
Genell Brown, Senior Staff Associate/Hearing Coordinator
Riley Moore, Deputy Clerk deg.

C O N T E N T S

----------
Page

WITNESS

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

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

The Honorable Rajiv Shah: Prepared statement..................... 8
The Honorable Keith Ellison, a Representative in Congress from
the State of Minnesota: Associated Press article by Katharine
Houreld dated February 17, 2010................................ 34

APPENDIX

Hearing notice................................................... 44
Hearing minutes.................................................. 45
The Honorable Howard L. Berman, a Representative in Congress from
the State of California, and Chairman, Committee on Foreign
Affairs: Prepared statement.................................... 47
The Honorable Diane E. Watson, a Representative in Congress from
the State of California: Prepared statement.................... 49
Written responses from the Honorable Keith Ellison to questions
submitted for the record by:
The Honorable Eliot L. Engel, a Representative in Congress from
the State of New York........................................ 50
The Honorable Ileana Ros-Lehtinen, a Representative in Congress
from the State of Florida.................................... 61
The Honorable Barbara Lee, a Representative in Congress from
the State of California...................................... 165
The Honorable Gus Bilirakis, a Representative in Congress from
the State of Florida......................................... 179

U.S. POLICIES AND PROGRAMS FOR GLOBAL DEVELOPMENT: USAID AND THE FISCAL
YEAR 2011 BUDGET REQUEST

----------

WEDNESDAY, MARCH 3, 2010

House of Representatives,
Committee on Foreign Affairs,
Washington, DC.
The committee met, pursuant to notice, at 9 o'clock a.m. in
room 2172, Rayburn House Office Building, Hon. Howard L. Berman
(chairman of the committee) presiding.
Chairman Berman. The committee will come to order. We have
to adjourn today's hearing shortly before 11 o'clock a.m. so
members can attend the memorial service for our late colleague,
John Murtha.
Given the relatively short time we have to spend with our
distinguished witness, I will limit opening statements to
myself and the ranking member. All other members may submit
written statements for the record.
Dr. Shah, I am very pleased to welcome you for your first
formal appearance before this committee and your first time
testifying before the deg.Congress as USAID
administrator.
Less than 2 weeks after being sworn in, you were made the
Obama administration's point person in responding to the almost
unimaginable tragedy in Haiti. Dealing with a crisis of that
magnitude would be a tall order no matter how long you had
served as administrator, and by all accounts you stepped up to
the task with great aptitude and aplomb.
Prior to your confirmation, USAID had been without a
permanent administrator for an extended period, so we
particularly appreciate the leadership you have demonstrated
and the experience and dynamism you bring to the job.
Our focus today is on the President's Fiscal Year 2011
budget request, and specifically the policies and programs for
development that USAID is responsible for designing and
implementing.
Secretary Clinton has rightfully identified diplomacy and
development as two key pillars of our national security, along
with defense. We make it a priority to reduce poverty and
alleviate human suffering around the world because it is the
morally right thing to do and because it reflects the
compassion and generosity of the American people. But foreign
assistance programs also serve our economic and national
security interests.
Poor and unstable countries make unreliable trading
partners and offer weak markets for U.S. goods and services.
Conflict, lawlessness and extremism that threaten U.S.
interests find fertile ground in the places where basic human
needs are not being met and fundamental human rights are not
respected. Done right, development assistance is a sound
investment in a better, safer world.
One of my legislative priorities is to reform our foreign
assistance laws and programs to ensure that aid reaches those
who need it most, and that it is delivered with maximum
effectiveness and efficiency. Our development assistance should
aim not only to improve the lives of poor people, but to build
the human capacity and the economic and political institutions
that will sustain these gains.
I look forward to working with you as we write legislation
to replace the outdated and cumbersome legal structure that
currently exists with one designated to meet the needs of the
21st century.
The administration is now in the midst of two reviews that
will have some bearing on this process. The Quadrennial
Diplomacy and Development Review, or QDDR, seeks to define the
capabilities that are needed and to match resources with
priorities. The Presidential Study Directive known as PSD-7
will, we hope, produce a national strategy for global
development that establishes clear and specific objectives for
United States policies and programs, consistent with the
Millennium Development Goals.
We should strive to achieve those goals not only in
countries where the risk of violent extremism is most
pronounced, but everywhere that children go hungry, women die
in childbirth for lack of skilled assistance, and communities
are ravaged by a preventable disease.
I am particularly gratified that the President's budget
places an emphasis on global health, food security and climate
change. These are areas where the international community faces
significant challenges, and where we know how to make a real
difference. They build on one of the great foreign policy
legacies of the previous administration, the President's
Emergency Plan for AIDS Relief, or PEPFAR.
To ensure that our assistance is as effective as possible,
we must elevate and strengthen USAID. I applaud Secretary
Clinton's call to ``rebuild USAID into the world's premiere
development agency.'' We also must make good on President
Bush's pledge to double the size of the USAID Foreign Service,
a goal that President Obama has also endorsed.
To put the budget numbers in perspective, the entire
International Affairs budget accounts for just over 1 percent
of Federal spending. And only about a third of that 1 percent
is allocated to development and humanitarian programs.
One overarching goal of our foreign assistance is to reduce
the need for putting American soldiers in harm's way. About 18
percent of the entire International Affairs budget--and about
60 percent of the growth since last year--is for the front-line
states of Iraq, Afghanistan and Pakistan. By building schools,
training police and increasing agricultural production, we help
lay the foundations for a more stable future in these volatile
nations. It is an investment well worth making, considering the
savings in long-term costs in American blood and treasure.
With this in mind, the increases for Fiscal Year 2011 are
quite modest and, I think, extremely well-justified.
Dr. Shah, we appreciate having you here this morning. We
look forward to your testimony. But first I would like to turn
to the ranking member, Ileana Ros-Lehtinen, for any opening
remarks that she might want to make.
Ms. Ros-Lehtinen. Thank you. As always, Mr. Chairman, thank
you for the opportunity. And Dr. Shah, I join in welcoming you
to our Foreign Affairs Committee. With the recent tragedy in
Haiti and the intensive, rapid efforts to help the people of
that devastated country, you have had a bracing introduction to
your current position. And as I had said to you in the side
room, you represented our humanitarian country so well, and I
commend you for an exemplary USAID mission in Haiti. You hit
the ground running. We wish you well in all of your endeavors
on behalf of our nation, and those whom it seeks to help
throughout the world.
I am, however, disappointed that the congressional Budget
Justification for your Agency is not yet available. That places
us at a disadvantage today in discussing the Fiscal Year 2011
budget request for USAID, because we lack that information.
Necessity is the mother of invention. The past year has
seen a dramatic deterioration in our nation's economic
position. Should the President's proposed budget for Fiscal
Year 2011 be adopted without any changes, the debt created in
the next year alone will equal an additional $4,000.00 owed by
every man, woman, and child in the United States. This would be
on top of the $40,000 that each American already effectively
owes, through the public debt.
We are now borrowing at a rate of about $4 billion a day to
keep our Government in operation. This is not the best position
for our country to be in.
In light of this situation, I recommended to Secretary
Clinton last week that, although our aid programs are not a
major part of the overall budget, we need to find places where
we can slow down or freeze spending. We have this opportunity
to foster innovation, and I believe that the seeds for this
innovation are already contained in some of USAID's programs.
They just need to be expanded to allow us to move away from
more costly assistance programs that work through wasteful, and
often corrupt, bureaucracies abroad, and that so often create
dependency and breed stagnation among recipient countries.
Instead of continuing with such tremendous reliance on
USAID's traditional Development Assistance account, for
example, we might instead consider moving quickly to expand our
Development Credit Assistance program, which, at far less cost,
leverages tremendous private funding in pursuit of our
development goals. In line with that, we might also consider
expanding USAID's Global Development Alliances program, an
approach that is, once again, built on leveraging private funds
and pursuing development goals without creating aid dependency
in other countries.
In short, we have to do more with less. There are
additional innovations out there, many of them based on
technological advances of the past two decades, which USAID is
either already experimenting with or should consider. I will
cite some examples.
Improvements in marketing by small-scale farmers and shop
owners in impoverished countries by means of cell phone alerts.
The development also of affordable, small-scale clean-energy
power generators that can be run off the electrical grid in
remote areas. Also, small-scale vouchers for farmers, allowing
them to break free from the control by huge bureaucratic and
often corrupt ministries in obtaining seed and other farm
inputs.
USAID is working in many of these areas, but we need to
think of how we can intensify the focus on such small-scale
programs, which can unleash individuals' creativity, rather
than continuing to interact with unaccountable bureaucratic
government agencies abroad.
We should also consider ways to multiply the impact of such
small-scale programs wherever possible, by implementing the
approach used in our micro-finance and micro-credit programs,
where even the poorest beneficiaries are expected to repay some
of their assistance to cooperative groups that can then, in
turn, provide such assistance to others. Small businesses and
individual opportunities are what helped America grow into the
prosperous country that we are, long before there was a theory
of development. It is time to revisit our longstanding views
and theories on how to help the impoverished around the world
become self-sustaining and prosperous.
I hope that the challenges of addressing our fiscal
deterioration here at home will lead us to truly explore ways
to be more efficient and accomplish our goals at less cost, but
with more benefit for those who deserve our help.
I thank you again, Dr. Shah, for what you have done in
Haiti. I know that you are already standing up a new program in
Chile, in far different circumstances. I congratulate your
entire team at USAID.
Thank you, Mr. Chairman.
Chairman Berman. Thank you, Ms. Ros-Lehtinen. And now I am
happy to introduce Dr. Rajiv Shah. He is the 16th administrator
of the United States Agency for International Development.
Prior to his confirmation as administrator, he served for
about 6 months as under secretary of agriculture for Research,
Education, and Economics, and chief scientist.
A medical doctor and health economist by training, Dr. Shah
previously spent 7 years with the Gates Foundation holding
leadership positions in its agricultural development and global
health programs.
Dr. Shah, your entire statement will be made a part of the
record, and we look forward to hearing your testimony.

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

Dr. Shah. Thank you. Chairman Berman, Ranking Member Ros-
Lehtinen, members of the committee, I am honored to join you
here today in support of the President's Fiscal Year 2011
Foreign Operations Budget Request.
In the interest of time, please allow me to summarize the
key points of my testimony, and submit the full text for the
record.
As you know, just days after my swearing-in, the people of
Haiti were struck by a tragedy of almost unimaginable
proportions. This past weekend, Chile suffered a devastating
earthquake, as well. Our thoughts and prayers, as are yours,
are with the people of Chile and Haiti, as we provide
humanitarian relief and assistance.
In the aftermath of the earthquake in Haiti, President
Obama designated me to lead our overall Federal response, and
charged our Government with mounting a swift, aggressive, and
coordinated effort. In that capacity USAID coordinated a multi-
agency effort, with the Departments of State, Defense, Homeland
Security, Health and Human Services, Agriculture, and many
other Federal partners.
With these partners we launched the largest and most
successful international urban search-and-rescue effort ever;
created a robust urban food distribution system that reached
more than 3 million individuals with critical food supplies;
greatly increased a nation's infrastructure, especially at the
ports and the airport; and coordinated medical assistance
support, including direct treatment for more than 30,000
patients, and performed hundreds of surgeries, saving lives and
limbs.
Haiti faces a long and steep road to recovery. And as the
operations transition from rescue to recovery, we will continue
to stand by the people of Haiti, and appreciate the support of
this committee and the Congress in doing so.
At the same time, we will not lose sight of the other
priorities, including the important work that USAID does to
help other countries achieve their development goals, and the
critical need to strengthen our capacity and accountability in
pursuit of this mission. The investments we make today are a
bulwark against current and future threats, both seen and
unseen, and a down payment for future peace and prosperity
around the world.
As President Obama said in Oslo last December, security
does not exist when people do not have access to enough food or
clean water, or the medicine and shelter they need to survive.
Secretary Clinton strongly shares this view, and has asked
us to elevate development to stand with diplomacy and defense
as part of our nation's foreign policy.
Together with other government agencies, USAID is examining
our resources and capabilities to determine how best to achieve
these development objectives. We are doing so through the
Presidential Study Directive on U.S. Development Policy, the
Quadrennial Diplomacy and Development Review, and through
consultations with congressional committees that are pursuing
foreign assistance reform.
The Fiscal Year 2011 budget request will support
development priorities that contribute directly to our national
security. Specifically, our request is focused on three
priority areas: Securing critical front-line states, meeting
urgent global challenges, and enhancing USAID effectiveness and
accountability.
Allow me to summarize each briefly. First, in critical
front-line states, we propose spending $7.7 billion in State
and USAID assistance in support of development efforts in
Afghanistan, Pakistan, and Iraq. We have made some progress in
each of these countries, but we realize that significant
challenges remain.
Over the past several years our focus in Afghanistan has
been achieving greater stability and security. We are beginning
to see major improvements in health care, education, and
agriculture, as well as, in some cases, the foundation of a
more representative and democratic government.
The administration's funding request is part of the
President's Afghanistan strategy, and designed to encourage
stability and opportunity in that nation.
In Pakistan, our request supports ongoing efforts to combat
extremism, promote economic opportunity, strengthen democratic
institutions, and build a long-term relationship with the
Pakistani people. Here, too, our programs are helping to
achieve significant improvements in education and health.
The funding increase in Fiscal Year 2011 for Pakistan will
help USAID reach approximately 60,000 more children with
nutrition programs, increased enrollment in both primary and
secondary schools by over 1 million learners, and support
500,000 rural households to improve agricultural production.
In Iraq we have transitioned to a new phase in our civilian
assistance relationship, shifting away from reconstruction
toward the provision of assistance to bolster local capacity in
line with Iraqi priorities. USAID is promoting economic
development, strengthening the agriculture sector, which is the
largest employer of Iraqis after the Government of Iraq, and
increasing the capacity of local and national government to
provide essential services.
Our second budget priority is focused on meeting urgent
global challenges. $14.6 billion in State and USAID assistance
will support local and global solutions to core transnational
problems, including global health, extreme poverty, natural and
manmade disasters, and threats of further instability from
climate change and rapid population growth.
In global health, we are requesting $8.5 billion in State
and USAID assistance. Our request supports the President's
Global Health Initiative. With this additional funding, we will
build on our strong record of success in HIV/AIDS treatment,
tuberculosis, and malaria control, and seek to achieve improved
results in areas where progress has lagged, such as obstetric
care, newborn care, and basic nutrition.
In food security we are proposing to invest $1.2 billion
for State and USAID food security and agriculture programs, in
addition to $200 million set aside for nutrition. With these
additional funds we will work in countries in Africa, Central
America, and Asia to combat poverty and hunger.
In climate change, we propose to invest $646 million for
State and USAID programs, part of the administration's overall
$1.4 billion request to support climate change assistance.
USAID will support the implementation of sustainable landscape
investments, as well as developing low-carbon-development
strategies for critical countries, market-based approaches to
sustainable energy sector reform, and capacity building and
technology development to enhance adaptation and resilience
strategies.
In humanitarian assistance, USAID and State propose to
invest $4.2 billion. This funding allows us to assist
internally displaced persons, refugees, and victims of armed
conflict and natural disasters worldwide, such as the tragic
earthquakes in Haiti and Chile. With these combined
investments, we will save lives and help make people less
vulnerable to both poverty and the threat of instability that
extreme poverty breeds.
Our third major budget priority focuses on enhancing
USAID's effectiveness and accountability by investing $1.7
billion in the ongoing rebuilding effort for USAID's personnel
and infrastructure.
All of the priorities I have outlined require strong
capacities in evaluation, planning, strategic resource
management, and research, to ensure we are incorporating the
best practices, innovations, and technologies from the field.
We also must be able to recruit, hire, and retain best-in-
class development professionals. By reducing our reliance on
contractors to design and evaluate programs, we will not only
save taxpayer dollars, but also enable greater oversight and
more effective program implementation. Through these critical
investments we can achieve the development goals we have set
around the world, and restore USAID's standing as the world's
premiere development agency.
I know this is a time of great economic strain for so many
Americans. For every dollar we invest, we must show results.
That is why this budget supports programs vital to our national
security and our ability to account for outcomes.
The United States must be able to exercise global
leadership to help countries, as they develop more stable and
sustainable foundations for security, stability, and well-
being. This requires the effective use of all instruments of
our national security, including development. And this requires
a relentless focus on results and accountability, a focus we
embrace with enthusiasm.
Thank you very much, and I look forward to your questions,
your guidance, and your ongoing consultation.
[The prepared statement of Mr. Shah follows:]Rajiv
Shah deg.

Chairman Berman. Well, thank you very much. We appreciate
your vision, and the specifics that fill it out. And I will
give myself 5 minutes to begin the questioning.
Dr. Shah, could you give us an update on the status of the
Quadrennial Diplomacy and Development Review, and the
Presidential Study Directive on Global Development Policy? And
more specifically, when can we receive the findings, and will
they be made public?
Dr. Shah. Yes, thank you, Mr. Chairman, for those
questions.
The QDDR has completed now its first phase of work, which
was structured around a broad set of exploratory conversations
and brainstorming related to five core working-group topic
areas relating to how the United States projects its power and
its smart power and its diplomatic and development capacities
around the world.
As we transition, we are in the process of transitioning to
a series of more operationally oriented task forces that will
be addressing specific topics, like how we improve our ability
to do policy planning, how we develop real systems for
accountability and budgeting, how we help our country's
missions and our country's chiefs of missions develop long-term
investment strategies for development and diplomacy, and have
the flexibility to partner more effectively with the private
sector with sources of innovation and with country governments
themselves.
The results of those more specific operational efforts
should be available in the April/May timeframe. We, at this
point, do hope to have deep and ongoing conversations both
about the content of the QDDR, as well as learning from the
committees and the Congress around a range of views on some of
these core issues. And that is an ongoing process, but one that
has shifted from a larger strategic conversation to a more
focused set of operational discussions.
The Presidential Study Directive is similarly making the
same transition, after having completed a series of phases of
work that brought together 16 to 18 different agencies
throughout the Federal Government to discuss ideas and concepts
in a more open space, related to the future of development.
That is now transitioning into also a more operational focus,
to come up with specific constructs that will define the
development strategy of this administration going forward.
These two processes come together in a number of different
ways, not least of which are deputy's committees that we
participate in; but also just the key individuals that are part
of both of these processes are often the same individuals.
Chairman Berman. And the PSD, when do you think that
process--you mentioned April?
Dr. Shah. Yes.
Chairman Berman. An initial idea of April for the QDDR.
What about the PSD?
Dr. Shah. Well, I should clarify, I don't think the QDDR
will be complete in April, but I think we will have enough
specifics to begin a serious consultation on a set of ideas in
that timeframe.
On the PSD, I would expect the same thing, although I
shouldn't speak on behalf of the National Security Council. I
think they can identify a more specific timeline, and we could
come back to you with a more specific answer on it.
Chairman Berman. I would appreciate that. In order to fund
Haiti's relief effort, you had to borrow money from other
humanitarian programs across the globe until the supplemental
funding arrives. Everyone understands the overwhelming needs in
Haiti, but the fact is, these transfers have created some
hardships and delays on the ground in other countries, such as
Sudan and Congo.
What is being done to ensure that other humanitarian
emergencies aren't being neglected in order to address the
tragedy in Haiti?
Dr. Shah. Well, I appreciate that question, sir. And I
believe the United States Government has already committed more
than $600 million to the effort in Haiti. And as you point out,
that, a large percentage of that, has come from the IDA account
that provides the flexible and rapid funding. We will seek, in
a supplemental, to reconstitute the IDA account as fully as
possible in this context.
We have been in close contact with our implementing
partners in other complex crises around the world, and have
asked them not to delay or slow down program implementation,
working under the assumption that those additional resources
will arrive prior to the June timeframe, which is when we, you
know, would have to start making those trade-offs that we hope
not to make.
So I am aware that a number of partners felt they might
have to do that. We have tried to be in touch with everyone who
has reached out to us to indicate that they should not slow
down programs in other areas; that we expect the supplemental
to reconstitute IDA in a manner that----
Chairman Berman. So you are really saying the assumption of
my question is wrong. There has not been deprivation in other
programs as a result of the transfer.
Dr. Shah. That is correct, sir. I believe there have been,
I know that partners have reached out to us, asking if they
should. And when we did, we tried to correct that misperception
right away.
Chairman Berman. And my time has expired. The ranking
member is recognized for 5 minutes.
Ms. Ros-Lehtinen. Thank you, Mr. Chairman. I want to touch
on Cuba, Haiti, the West Bank, and Gaza, all in 5 minutes. No
problem, right, Dr. Shah?
I am concerned that, with the arrest and the imprisonment
of U.S. citizen Alan Gross, that USAID programs in Cuba may
have come to a standstill. If we could get a commitment from
you, Dr. Shah, that USAID is going to continue to carry out
U.S. democracy programs in Cuba, I would appreciate that.
On Haiti, following up on the chairman's questions, how
should the cost of recovery response and long-term development
efforts in Haiti be shared among donor countries? And what
portion of the overall aid efforts for Haiti over the coming
years should the United States be expected to provide; 10
percent, 20 percent, 30 percent, whatever figures you think.
Lastly, on the West Bank and Gaza, the administration has
requested another over $400 million in Economic Support Funds
for the West Bank and Gaza, but, as we have seen, there has
been a lot of stealing of those funds; it has not been managed
well.
What kind of vetting do we have in place to ensure that the
funding does not benefit violent extremists or corrupt
officials, and instead reaches its intended targets? What kind
of metrics are we using to ensure that we can actually
accomplish what we seek to do with the funding?
Thank you, sir.
Dr. Shah. Thank you. I appreciate those questions. On Cuba
in particular, I think we can strongly affirm our commitment to
execute our programs and our priorities. We have taken a number
of steps working with the State Department to try to address
the needs of Mr. Gross. I have been in direct contact with DAI,
the partner for whom he was contracted to work with. And we
have worked directly with a range of our other partners to
ensure that they, given the challenging travel situation, that
they come up with alternative solutions to execute and
implement these programs. And we are giving them the
flexibility to do that. So we are fully committed to seeing
through the program there.
On Haiti, I appreciate your points and your earlier
comments there, as well. We have been approximately half of the
overall early relief effort. A large part of that is the
Department of Defense, the costs related to Department of
Defense assets, including the Marines, the Comfort Hospital
Ship, the effort to rebuild the port and the airport, those
were mission-critical early activities that were required for
other assistance to come in.
As we transition through recovery reconstruction, we expect
that percentage will go down significantly. And we are working
with a range of major bilateral partners, but also the World
Bank, as part of the post-disaster needs assessment, to make
sure there is a strong plan going forward that is unveiled at
the donors' conference later in March, this month. And that
U.S. assistance is targeted, and a far more modest percentage
of the overall needs. It will be a small percentage. But our
leadership will be critical, and our technical support and our
deep engagement in this process will be continued and
unwavering.
On West Bank and Gaza, I appreciate the question, as well.
As you know, we have systems for both tracking partners and
vetting partners. The partner-vetting system there involves the
specific identification of names of partners. It involves our
database tracking systems, and we vet that very, very
carefully. That system has been in place for more than 2 years.
On the cash tracking, we also have a very specific system
that has been in place for more than 4 years, where we are
supporting and we authorize specific disbursements from the
Palestinian Authority. The resources are transferred quite
closely, from a bank in Israel to a special Treasury account in
the Palestinian banking system. And then all flows out of that
are monitored on a case-by-case basis.
So there is a very strong system in place for tracking cash
flows in that environment, as well. And our budget request
going forward is to really focus on doing specific work that
will achieve real outcomes in infrastructure and in health, and
in humanitarian support in Gaza. And I am happy to describe
that some of the things we have done have been successful,
building 60 kilometers of road in the West Bank, funding seven
schools that are operational and effective, and promoting a
broadly based health system in that region that is reaching
many, many more people in need.
So we will continue to track those outcomes very closely,
but we have special systems for tracking how we work with
partners, and how we track the flow of cash.
Ms. Ros-Lehtinen. Thank you so much. And the emphasis
should always be to make sure that it is a transparent,
accountable system of aid that is not corrupted by officials in
the West Bank and Gaza.
Thank you, Dr. Shah. Thank you, Mr. Chairman.
Chairman Berman. I yield 5 minutes to the gentleman from
New Jersey, the chairman of the African Global Health
Subcommittee, Mr. Payne.
Mr. Payne. Thank you, Dr. Shah, and let me also commend you
for the outstanding job that you have done in Haiti. Also, I
wish we didn't have a debt, but we do have to remember we had a
balanced budget when President Clinton left. However, the war
in Iraq, which was unnecessary, and big tax cuts put us in the
position we are in today, unfortunately.
Let me just say about the Global Fund. I see that you have
cut $50 million from the Global Fund, and I wonder if you would
look at that. Because, as you know, the U.N. formula is a one-
third U.S., that means $150 million will be cut overall when
the other nations participate.
Secondly, on the neglected tropical diseases. Although you
are dealing with them, some of them, the most neglected, such
as fatal vascular mineosis, sleeping sickness, Charge's
Disease, and some of these other disfiguring, buruli ulcers,
are not covered. And I wonder if they could be included in
that.
Just real quickly, on three governance groups, Somalia, the
transitional Federal Government. I wonder, will there be a
significant increase in development aid, because we have to
support this government or we are going to be, in my opinion,
in very serious problems. If they fall, all of these--Africa,
as you know, Somaliland, Putland, and Somalia, in my opinion,
will go.
Secondly, are we concentrating enough on South Sudan? If,
in 2011, they decide to secede, how will we support the new
government with additional funds?
And finally, Liberia needs to have some consideration.
Where we have strong institutions, we see elections work, like
South Africa and other places. Where we don't, they fail. So if
you could look at Liberia, the historical relationship between
the United States and Liberia is important.
And finally, I would like to know how you are making out
with AFRICOM and the coordination with that. I will just stop
so that you can answer the questions. Thank you.
Dr. Shah. Thank you, Mr. Chairman. We have, on the global
front in particular, and that is in the context of the larger
Global Health Initiative, we are committed to significant
financial increases against Global Health. And even more than
that, using those resources in a way that will be more
effective against those lagging indicators within the MDGs,
like maternal mortality and newborn and obstetric care.
We are working with the Global Fund, with the Global Lines
for Vaccines and Immunization and other vertical programs, to
try to accelerate the partnerships between them, and get more
value out of the overall investment.
The overall administration request on the Global Fund is $1
billion, because it, of course, includes the Treasury
component. And we will be very committed to helping the Global
Fund succeed.
On neglected tropical diseases, I will take your comments
as advisement, and look specifically into those cases. That is
a unique area where I do believe we can have, and we have been
in discussions with private partners to accelerate public-
private partnerships and meet the overall needs, as they have
been delineated by the World Health Organization and others.
And that is very much a priority of the Global Health
Initiative.
On Somalia, we will, in terms of increases in development
assistance, as you know, most of our assistance is humanitarian
at this point. It is flowing through the north. We continue to
be in close conversation with the World Food Program to explore
what can be done, and when it can be done in other parts of
Somalia. And we look to use our development assistance in a
strategic manner. I will follow up more specifically on what we
could do to be more expansive in that context.
With Southern Sudan, we have $95 million for the referendum
and for support for the referendum, and we are doing a series
of activities with respect to capacity building and serving the
people of Southern Sudan.
I will note that our mission is in that region there. And
unlike other partners, even multi-lateral partners that are
trying to serve that region from farther away, we feel we are
very well-positioned to play a critical role should the needs
arise, as you have identified. And so we are doing contingency
planning around that, and also identifying what kind of budget
flexibility we would have, and what the needs would be.
But we think we have an important role in leading that
effort. We think we would have an important role in bringing
other donors and multi-lateral institutions to that mission,
should that be the outcome of the early 2011 referendum. And I
will take your comments on Liberia as guidance.
And on AFRICOM, we continue to be in discussion with them,
and do hope to have a strongly coordinated operational effort
in Africa with them. I personally visited them this summer, and
hope to continue that conversation.
Chairman Berman. The time of the gentleman has expired. The
gentleman from Texas, Mr. Poe, is recognized for 5 minutes.
Mr. Poe. Thank you, Mr. Chairman. Dr. Shah, thank you for
being here. I am over here, far right to you.
First of all, I want to commend the workers in the field in
USAID. I have traveled, you know, like everybody else on this
committee, all over. And they are the greatest ambassadors for
the United States and freedom that we have, are those people in
the field.
And I know that USAID is developing all kinds of things.
Most recently, the farmers down there at Texas A&M invented
some kind of soybean that now yields nine times what they used
to yield, for Afghanistan, so that the farmers in Afghanistan
don't have to raise poppies. They can raise soybeans that were
invented at Texas A&M. I mean, that is all good things, those
are all good.
I am concerned about, though, being good stewards of money.
Last week we had before us the Special Inspector General for
Iraq Reconstruction, Stuart Bowen. And he said that in
reconstruction of Iraq there was, and there is, $4 billion
unaccounted for.
And I asked him which, of all the agencies that are in Iraq
from the United States, has the, I guess the worst record of
accountability. And he said the State Department. Of course,
the example he used was the $2.5 billion that went to Dimecorp
for training police officers, and there is no record. We have
no records about where that $2.5 billion went. And so I am
concerned about the unaccountability of money we send.
And I also asked him about well, could some of that money
have turned up in the hands of our enemies, like al-Qaeda? And
he mentioned that there were 14,000 Glock weapons that
disappeared from our possession to somewhere else. That
troubles me. We have our men and women in uniform overseas
trying to protect us, and guns that we ship over there end up
in their hands because our Federal agencies aren't good
stewards of, of the money.
So you want an increase in the budget. We have 15 million
Americans unemployed. It seems like, to me, when some country
is in trouble, of course they call 1-800-USAID to come over and
help them out, you know. That is what we kind of do in this
country. The government and the people of this country are the
most giving of any nation in history.
But I would like for you to specifically address this
problem of accountability. And how do we know that this money
is going to be accounted for; that thieves aren't going to
steal it, that crooked contractors aren't going to steal it,
and the bad guys aren't going to end up with some of the aid
that we send to foreign countries. Similar to some of the
questions that the ranking member addressed in other parts of
the world.
So how about that, Dr. Shah?
Dr. Shah. Thank you, sir. I want to thank you for your
comments about our staff, and also acknowledge that our Foreign
Service nationals in that context do make us awfully proud.
I also want to address your comment about Texas A&M. We are
proposing in this budget an increase in our agricultural
research and development as it relates to meeting the needs in
some of these priority countries in food security.
With respect to Iraq reconstruction, the contract you
referred to, I would just point out that for USAID, we have a
shifting strategy where we are moving toward supporting the
elections that are upcoming, and providing real support to the
government and the health system, and other, meeting basic
human needs and the needs of IDP populations.
We are also more aggressively pursuing matching fund
requirements to make sure that our resources are being matched
by the Government of Iraq. And we have strong financial
accountability and procurement systems in place that are
tracked very closely in that context.
In general, your point----
Mr. Poe. Excuse me, Dr. Shah. Are these accountability, are
these accounting procedures new? Or are they the same ones
where----
Dr. Shah. No, many of them are new over the course of the
last year. Some of them have all been, are based on some
learning.
There are four basic strategies we use to track and ensure
accountability. I agree they could be more transparent, and it
is one of my priorities to make them more effective and
transparent.
One is selectivity. We have rigorous systems for making
sure we only work with those partners, especially in
Afghanistan and Pakistan, where we can track the resources and
have confidence in effectiveness of spending.
A second is around capacity building, particularly in
financial management and procurement systems, both reform and
tracking.
A third is on monitoring, and a fourth is on auditing,
which we do in a multiple manner system in those places.
Mr. Poe. Thank you, Dr. Shah.
Chairman Berman. The time of the gentleman has expired. The
gentleman from New York, Mr. Meeks, is recognized for 5
minutes.
Mr. Meeks. Thank you, Mr. Chairman. Good morning, Dr. Shah.
It is great having you here, and I thank you for, commend you
for all of your efforts, especially in helping Haiti with the
aftermath of the devastating earthquake.
You talked about how complex it is in dealing with Haiti. I
would like first to ask you the question, can you describe for
us the international aspect of the effort to help Haiti?
Specifically what I am interested in is the coordination of
efforts, the coordination of funds, who is leading that effort,
where do we go from here, and what role can the Haitian
Government play? And how do we support that government until it
has the capacity to take on more or most of the responsibility?
I know that there are a number of international communities
that are calling for a Haiti Marshall Plan. And I, myself, have
put in a resolution calling for a Haiti Marshall Plan. So I
would like to know what your thoughts are on whether or not we
need to do that clarion call, and whether Haiti needs a
Marshall Plan.
Then, I just want to ask also, in the short time that we
have, about Afro-Latinos in the Western Hemisphere. You know
that the Obama administration has finalized the signing of the
U.S.-Colombia Joint Action Plan on Racial and Ethnic Equality.
And we have one on Brazil, of which I have asked also to get
the report on that, so that we can continue to follow that. I
know we are still making progress. But over the years, I have
requested appropriators that, from the USAID funds be
specifically directed toward helping marginalized communities
in Latin America. And more often than not, those
disproportionately means they are Afro-Latinos and indigenous
populations.
So I would like to know, can you tell me about your plans
to address the plight of African Latinos and indigenous
populations? And have you prioritized the plans from the budget
perspective?
And finally, and real briefly, I am also concerned about
trade capacity and trade capacity dollars. So can you tell me
if there are any plans to more comprehensively coordinate trade
capacity dollars across the various departments and agencies
that have these funds?
I have proposed, for example, that we create an Office for
Trade Capacity for the nation. I would like to know your
thoughts on this kind of function.
Dr. Shah. Thank you for those comments and questions. I
will start with Haiti.
The international aspect is being led by the Government of
Haiti, working with an internationally recognized system of
U.N. clusters that are established sector by sector. We play a
key role in each of the clusters, and directly with the
Government of Haiti.
We also, in some cases, like rubble removal for the
establishment of safe places in advancing, where the floods are
coming in, or in food distribution or water distribution, at
times when frankly we felt the clusters needed more support, we
have stepped in and offered more capacity and more directed
leadership from our military-civilian partnership in Haiti. So
that is how it is being coordinated on an international aspect.
In terms of the plan forward, the Haitian Government has
had a plan, most recently unveiled last spring, and also
revised and updated for last fall, which was based on a
decentralization of the population outside of Port-Au-Prince,
and creating vibrant economic opportunities and centers of
economic activity outside of Port-Au-Prince. We expect them to
unveil that plan in a more updated and specific form at the
upcoming donors' conference, and believe that does constitute
the groundwork for a very strong reconstruction effort that
will hopefully build back a more vibrant and more effective
economy, governance system, and ability to meet human needs in
Port-Au-Prince. And, perhaps more importantly, to the majority
of the population outside of Port-Au-Prince.
In terms of your comments about Afro-Latinos in the Western
Hemisphere, it is absolutely true and completely recognized by
our agency that those marginalized communities are
disproportionately suffering on health and human indicators of
welfare and well being throughout the hemisphere. And that is a
clear and statistically straightforward point.
I will come back to you more specifically on how our budget
addresses that. But in our efforts to address food security,
global health, and meeting basic human needs, we are
disproportionately targeting those marginalized populations.
And how that plays out in terms of budget numbers, I will come
back to you more specifically.
And finally, on trade capacity building and coordination, I
do believe that we need more effective coordination in that
context. We have been in a conversation as part of the
Presidential Study Directive, and in efforts like our Food
Security Initiative, to explore how we can improve the
integration of our trade policy, our trade capacity
investments, and our investments in agriculture and high-value
agriculture, to get more bang per buck in our development
spending.
Thank you.
Chairman Berman. The time of the gentleman has expired, and
the gentleman from New Jersey, Mr. Smith, is recognized for 5
minutes.
Mr. Smith. Thank you, Mr. Chairman. Dr. Shah, thank you for
your testimony.
About 12 years ago, Dr. Shah, I initiated an effort on the
whole issue of autism, at a time when very few people were
paying attention to it. And it led to the creation of the
Centers of Excellence. As a matter of fact, I wrote the
provisions for the Centers of Disease Control.
We quickly found that we may have an epidemic where about
one out of every 100 of our children have autism or part of the
autism spectrum.
I have since been focusing on the international elements of
autism. And to my not shock, but certainly to my, and I think
many other people's, dismay, have realized that we have a
global epidemic of autism.
I am working with a number of NGOs in Nigeria, in Kenya,
Indonesia, Poland, and in Ireland, in trying to combat autism.
And what all of these organizations have is a deficiency in
funding. Lots of thought, a lot of good expertise, but lack of
funding.
I have introduced legislation, H.R. 1878, about a year ago,
that would provide a small grants program, and also a teach-
the-teachers program. And I am asking you if you would take a
good, long, hard look at these NGOs, as I am sure you have the
authority, absent the legislation, to assist these NGOs.
I will give you one on defeating autism in Nigeria, as I
know some of the people involved with an NGO there. They
suggest that there may be as many as 1 million Nigerians who
have autism. So I would ask you to take a good, hard look at
this, and provide some assistance there.
Secondly, on your three priority areas, you talk about
instability from rapid population growth. I would respectfully
request that you take a second look at the issue of
depopulation. In places all over Europe, Russia, the U.N.
estimates that by the year 2050, there will be 25 percent lower
population than that which currently exists in Russia. It is
the same way with all of the Eastern European countries. We are
seeing a depopulation trend.
The reason why the aggregate continues to grow is that we
are living longer. It is not about births; it is about the
other side of the spectrum. In South Korea, they are so far
below replacement--Japan has the same problem--that they are
looking at a serious disproportionality when it comes to
workers and those who are on the other end of the spectrum
receiving benefits.
So I think your underlying assumption has been surpassed,
in many ways, by a depopulation trend that is very injurious to
individual countries. And in China, where the sex-selection
abortions has led to gendercide, there are as many as 100
million missing girls, and a whole unique set of problems has
developed there. As many as 40 million men will not be able to
find wives by 2020 because they are gone, they are dead, as a
result of sex-selection abortion and the one-child-per-couple
policy. That is a crime against women, of gargantuan
proportions.
So I would ask you to look at maybe some of the underlying
assumptions about population growth. There is a depopulation
trend that is very, very dangerous.
Finally, on obstetric fistula, I pushed very hard with Dr.
Kent Hill when he was at USAID on behalf of building out the
ability to meet women's real needs when they have obstetric
fistula. Getting the surgeries that are very low cost and high-
impact gives the woman her life back.
Like many of my colleagues, I have been to the hospital in
Addis. I have been to other obstetric hospitals. Can you give
us an assurance that you will not only continue that money, it
was $12 million at the time, but hopefully significantly expand
it? I yield.
Dr. Shah. Thank you for those comments and questions. On
autism, I will be happy to look at the NGOs you are proposing,
and we can do that in a systematic manner.
I do believe the principles of the Global Health
Initiative, which is to broaden the scope of how we think about
supporting health systems and setting priorities based on
medical need, and based on what are the biggest lagging
indicators against meeting development goals, will help guide
our work in the health sector overall going forward. And I
appreciate your comments on that issue.
On instability from population growth, I do believe the
2050 population projections are significant, and they do show
over 9 billion as a global population. And I think consistent
with your comments, they show that those increases will happen
in certain parts of the world, and certain parts of the world
will stay flat, and in some cases decrease. So I appreciate
that, and we will take a nuanced look at that very
specifically.
Some of your comments related to gender and girls in that
context, which is an immediate priority for our team and for
the Secretary. And on obstetric fistula, I do believe our
Global Health Initiative, in its reprioritization of obstetric
care, of skilled attendants at birth, and of focusing on the
needs of women and girls, will create a strong strategic
priority in that space.
Thank you.
Chairman Berman. The time of the gentleman has expired. The
gentleman from Georgia, Mr. Scott, is recognized for 5 minutes.
Mr. Scott. Thank you, Mr. Chairman. Dr. Shah, let me first
of all commend you and the Obama administration for the very
quick response to the situation in Haiti. I would like to ask
you a few questions about that, if I may.
First of all, as of today, how much money has USAID spent
in the disaster relief in Haiti?
Dr. Shah. I believe the overall Federal commitment has been
just over $600 million, maybe just over $630 million. We could
get you a very specific number.
Of that amount, I think USAID has spent approximately $350
million, with the majority of the alternative part of that
being Department of Defense spending.
Mr. Scott. Which leads to my next question. Where has that
money been spent, by category?
Dr. Shah. I would have to provide you a more specific
breakdown, but the major areas have been out of our disaster
relief account, which immediately supported priorities for
urban search and rescue. We sent our two trained international
urban search and rescue teams, but also four or five other
teams that were stood up by FEMA, so that we had at any one
time more than 500 American search and rescue professionals
with heavy equipment and specialized training at work for an
extended period of time.
We made significant investments in the health space,
spending resources to take disaster medical assistance teams
from the Department of Health and Human Services, and put them
in place supporting the treatment of more than 30,000 Haitians
in that context. And then food and water were immediate
priorities that accounted for a large bulk of that spending. We
successfully supported the distribution of food to more than 3
million people who were at risk, and had some immediate and
progressive procurements to make sure that people had as much
access to water in the camps as possible. We think we
successfully met the needs around water. That was a big concern
in the early moments.
So those have been the big areas of disaster assistance
spending. And in addition to that, the Department of Defense,
with its personnel and its other resources, and the Comfort
Hospital Ship, also are cost items that we are tracking.
Mr. Scott. And going forward, Dr. Shah, where do you feel
the priority should be now? Where is the greatest need now for
the people of Haiti?
Dr. Shah. Well, the immediate needs are in two areas. One
is in the collective effort to remove rubble from, and other
waste, from critical sites, whether they are elevated sites
where people could live, or whether they are drainage systems
that will be critical when it rains.
Linked to that is shelter and sanitation. So we are
aggressively pursuing those three priorities, with the common
goal of reaching every Haitian in need with shelter materials,
first by March 8, and then with an expanded set of shelter
materials by April 8. That is probably the top and immediate
priority.
A second priority is public health. And we have vaccinated
more than 150,000. We are trying to reach 150,000 people. I
think we have reached more than 80,000 so far, in advance of
the rainy season.
Mr. Scott. Very good. Now, there have been some reports
coming to us from Haiti that, in our efforts to really move
forward and help them, particularly in our food export area,
and particularly in the area of rice, which is major farming
product of the farmers in Haiti; and there has been some
concern that maybe our efforts to do that have undermined the
basic farmers in Haiti, because we have over-supplied the
market, and thereby putting disincentives in for the Haitian
people themselves, in farming, to produce their own food.
Can you give us an assessment of that situation, and what
are we doing to make sure we correct that?
Dr. Shah. Well, thank you, I appreciate your raising it. It
is an incredibly important point.
What we did was initially, upon sending food, we also sent
some experts who could track market prices of different food
commodities, including rice, vegetable oils, beans, and track
the flow of charcoal and other cooking supplies in markets, to
make sure that we were pursuing an assistance strategy that did
not impede local market systems and resilience.
We have been tracking that closely. We do think we have had
an aggressive response. The data on rice is varying. The data
on beans and vegetable oil is that we have not had as
significant price effect of that.
And complementary to this effort, we have accelerated our
major program to support the agriculture sector, including
trying to get fertilizer support and seeds and other
agricultural support out to farmers in advance of this planting
season. And we will continue to track the price of rice closely
to make sure we are not distorting incentives for local
production. You are right to point that out as a critical
issue.
Mr. Scott. So we do have effective monitoring and
evaluation and measurement systems in place to measure what we
are doing?
Dr. Shah. As best we can, in an emergency environment. We
were getting wildly different price estimates from different
markets, which would not take place in a normal setting. So we
are doing our best, given that issue.
Mr. Scott. Thank you. And again, I commend you for your
excellent work.
Dr. Shah. Thank you.
Chairman Berman. The time of the gentleman has expired. The
gentleman from Arkansas, Mr. Boozman, is recognized for 5
minutes.
Mr. Boozman. Thank you, Mr. Chairman. Secretary Clinton
recently stated that we hope one day to put ourselves out of
the aid business. Because, due to our success, countries will
no longer need this kind of help.
Can you give us some examples of how aid initiatives have
been successful in permanently breaking the cycle of dependence
by impoverished countries on outside aid?
Also maybe in your answer, micro-finance is something that
I have a lot of interest in.
Dr. Shah. Certainly, thank you. I think that is the long-
term goal for anyone in the assistance business, which is to
put ourselves out of assistance because countries effectively
graduate.
The most commonly cited examples are not always the most
generalizable ones, like Western Europe after the World War and
after the Marshall Plan, or South Korea and some other East
Asian and Southeast Asian economies that were USAID
beneficiaries, and now are becoming donor countries. And so
that is important, they are important examples, and we are
trying to learn lessons from there to apply elsewhere.
The guidance in the Spence Commission Report I think offers
a lot of interesting parallels of how we could pursue work
differently in other parts of the world to achieve those
outcomes.
In terms of more specifically, areas like our Global Health
Initiative or our Food Security Initiative are where we are
trying to use that principle in a more sector-specific manner.
So in global health, in a country that we prioritize, we will
look at our full portfolio of activities. We will partner more
deeply with countries. We will develop a financial
sustainability plan, and we will do our best to identify an
exit strategy for our partners and our own financing. It may be
a long exit strategy, but an exit strategy, so that we are not,
so that we are all aiming against that common goal on a more
sector-specific basis.
I appreciate your raising micro-finance. This is an
important area, and the ranking member also made reference to
the Development Credit Authority.
We recently completed a transaction that provided credit
authority support to micro-financed institutions through the
Grameen Bank and its global network. That will leverage more
than $160 million, and provide institutional support to
institutions around the world to put resources in the pockets
of women and vulnerable populations around the world that have
a surprisingly high repayment rate. And in a financial system
that, even though it is banking to the poorest, it is an
incredibly safe bet to make in terms of repayment rates and
risks that the communities take.
We are also, in the micro-finance area, looking to expand
and enhance our investments in the development of other
financial services for the poor. Most notably, insurance
products and savings products that have, recent data and
research have shown, are critically important to reducing the
vulnerability of those people to all kinds of shocks and risks
that they experience in their day-to-day lives. So we
appreciate your comments.
Mr. Boozman. Very good. One of the other things that I have
experienced is, in traveling to various countries, and this is
certainly not true of all areas. But it does seem like there is
a duplication of services. You get into turf battles, you know,
where USAID is there doing a certain function, and then you see
duplicative, you know, activities by perhaps another branch of
the State Department.
Do you see that as a problem? Is that something that you
have experienced? And if so, how do we solve that problem? How
do we get people on the same track? Right now, with the, you
know, all of us being so aware of the finances, the limited
finances that we have got, again, I would appreciate your
comment on how we would tackle that problem.
Dr. Shah. I appreciate that. There clearly are, in certain
parts of the world, a significant duplication of services. And
what is a clear priority for us is trying to get to a place
where we are prioritizing efficiency and outcome, and using
resources as effectively as possible.
I think you do that by really three things. The first is
you set very clear and specific development goals and
development priorities. We are expanding our efforts to do
that, both in our hiring of expertise at USAID and in
developing better policy planning and evaluation systems.
The second is we aspire to serve as a whole of government
platform to point resources against those goals in an efficient
and non-duplicative manner. The learnings from Haiti I think
accelerate the need to do that. The health sector in Haiti is a
good example, where we had some unique capabilities at the
Department of Health and Human Services that were brought into
the field. And we have been able to transition those
capabilities to local NGO partners to expand their ability to
provide more services to Haitians. We need more examples of
that kind of partnership for effectiveness and outcome.
And the third is really to focus on focus and scale as we
implement our programs. And so we structured our policy
planning to do that on a program-by-program basis.
Mr. Boozman. Thank you, Mr. Chairman.
Chairman Berman. The time of the gentleman has expired. And
the gentlelady from California, Ambassador Watson, is
recognized for 5 minutes.
Ms. Watson. Thank you, Mr. Chairman. And Dr. Shah, welcome.
I have really admired your stewardship of USAID. I have been in
several informational hearings with you, and you give us
inspiration that this program is working well.
I want to relate now to the Lantos-Hyde Act. And if you
remember, it mandated a 5-year strategy to treat 4.5 million
cases of tuberculosis under DOTS, and 90,000 multi-drug-
resistant TB cases.
The Global Health Initiative, on the other hand, proposes
to treat only 2.6 million TB patients, and only 57,000 MDR TB
cases. Moreover, TB will soon need new drugs to combat the rise
in highly resistant TB.
So what specific initiatives are planned to strengthen
country responses to re-emerging infectious diseases such as
TB, and how will TB treatment be incorporated into a health
system-strengthening approach?
Dr. Shah. Thank you. I very much appreciate that. I got my
first experience in tuberculosis, working on a DOTS program in
rural South India a number of years ago, and recognize how
critical and important this issue is, and the importance of the
legislative targets.
I would say that the distinction between the targets, in
terms of the 4.5, 2.6, 90, and 57,000 with respect to MDR, is
primarily, I believe, the distinction between what we think we
can achieve in our bilateral programs with current technology
and implementation protocols, and what we would hope to achieve
by getting more efficiencies out of the Global Health
Initiative.
And we can get those efficiencies in two ways. One is as we
repackage our complete programs to be more systems-oriented, I
fully expect, especially given the relationship between TB and
HIV, that we will actually have more resources that are
currently not counting, going toward the joint treatment of TB
and HIV, and getting those numbers up.
The second is I think we will partner better with the
Global Fund, and do more shared system-strengthening
investments that would expand their capacity and ours to reach
TB patients.
So I believe those numbers, the 2.6 and the 57,000, are
really floors upon which we can build as we get more efficient,
and as we partner more effectively.
The second point I would make is we will increase our
research and development investments in this space. I am
particularly enthusiastic about new diagnostic technologies
that I think will detect TB earlier, allowing more cases to be
treated in the general platform, as opposed to MDR
requirements. And that would lower dramatically the cost of
each treatment episode.
I also believe, with new drugs and treatment protocols,
over time the length of time needed to treat an MDR patient
will come down significantly, potentially to as little as 9
months. And if that happens, that would significantly expand
our capacities to offer treatment more broadly.
So we will track these things very closely, and try to
learn from some of the more innovative efforts that are taking
place around the world in TB.
Ms. Watson. Yes. Are you seeing TB in Haiti?
Dr. Shah. Well, we have had all kinds of reports. We have a
51 surveillance site system that the Centers for Disease
Control has set up with our support, tracking diseases. We have
not had a big outbreak or any specific reporting in that area,
but they are out there looking for it. And I did see some
earlier episodes they thought were TB, but then I didn't get
the follow-up that indicated that it had been confirmed.
Ms. Watson. Thank you for that. The administration has
stressed country ownership of aid projects. And the true
meaning of this concept is really unclear to us. Words such as
country-based and country-led are also in the mix.
And also, in addition, aid is coming from a variety of
sectors: GHI, PEPFAR, MCC, and the Global Fund, and so forth.
So can you tell us what country ownership and its many
variations means to you and the administration? And how will
this be reflected in your policies? And can you expand on how
health initiatives will be coordinated within countries already
receiving other forms of aid, and keeping in mind the country
ownership concept?
Dr. Shah. Well, thank you. The Global Health Initiative
will include all of the investments the U.S. Government makes
in helping a country to achieve that goal.
Quickly, the four components of country ownership, to us,
are country plan, specific guidance from countries that informs
our own strategic investment, and restructuring our contracts
and our programs to abide by those guidances, and sharing data,
information, and personnel against the common strategy and
learning platform.
I am very enthusiastic about my ability to work with Tom
Frieden at the CDC and Eric Frisby at the OGEC in order to do
that more effectively going forward.
Ms. Watson. We are out of time. Thank you so much.
Chairman Berman. The time of the gentlelady has expired,
and I recognize the gentleman from California, Mr. Sherman, for
5 minutes.
Mr. Sherman. Thank you, Mr. Chairman. I believe in foreign
aid development because it is the right thing to do. But we are
told to go to our districts and sell it as a necessary
component in the war on terrorism, something we do for our
national security, not just out of generosity.
And frankly, if American people were convinced that it was
only altruistic, I think we would have an even more difficult
time selling foreign aid.
Now, the proponents of foreign aid put forward the idea
that any alleviation of poverty in the world reduces terrorism.
This fits a Western morality play view of the world. Because we
all desperately want to live in a reasonable world, and so
something like terrorism must be the just and reasonable
response of desperate people who are desperately poor.
Unfortunately, we live in an unreasonable world. Poverty
does not correlate with international terrorism. Both the
Christmas Day bomber and bin Laden come from some of the
richest and most powerful families in the world, and a majority
of those who struck us on 9/11 come from a country that has
received far more infusions of cash than USAID has ever dreamed
of putting into one country or all countries; namely, Saudi
Arabia. They were middle- and upper-middle-class kids from a
country that gets an awful lot of American cash.
Somalia is kind of a separate case. But looking at the
world as a whole, the poorest 10 percent of the world's people
cause less than 10 percent of the international terrorism. So
simple poverty alleviation itself cannot be justified as a good
investment in our, in the global war on terrorism.
Another problem we have is the bureaucracy of USAID. It
took strong political push to get them to put the flag on the
bag. They didn't want to say this aid is from the American
people; they just wanted to give out the aid. So many of your
staff are people that wanted to work at OXFAM, but wanted a
retirement plan.
What can you do to make sure that when we select the
countries and the projects, when we design each part of that
project, and when we publicize the efforts and decide how much
resources to put into publicity rather than doing good, and put
the money into telling people we are doing good, that we are,
in fact, honest with the American people that this is an effort
to win the global war on terrorism and to protect them?
Because as good a goal as alleviation of world poverty is,
and as much as I would support it, I don't support telling the
American people we are doing it to stop terrorism; and then
failing to select, design, and publicize so that we really are.
Given your reluctant bureaucracy, what are you doing?
Dr. Shah. Thank you, sir, for that comment. I do believe
that our budget presentation prioritizes the intersection of
development investments in specific places and parts of
specific civilian and military strategies that are designed to
defeat al-Qaeda and support a stronger and more effective
global security environment for our country. It is why we
present our budget in the context of Afghanistan and Pakistan,
where that is being carried out as a front-line state.
I would also note that we have looked carefully at the data
following the Indonesian tsunami, that I know you were involved
in, with the relief effort there. The branding effort around
USAID's giving in that context more than doubled our
favorability rating among the Indonesian people. And in that
same 6-week period after the tsunami, it actually reduced by
more than half the favorability of the Indonesian people in
Osama bin-Laden.
Mr. Sherman. I have limited time. I like your answer, and
hope you will extend it for the record. I just want to urge you
to do everything you can to make sure every aspect of design
and selection reflects what we are telling the American people.
I want to put forward one idea, and that is, in the
impoverished world, people have to pay for their kids'
textbooks. If we were to print all the elementary school,
middle school textbooks, A, we could make sure that the
content, while not entirely politically correct perhaps from an
American perspective, was good; and second, we would be helping
education; and third, we would be reducing corruption, because
it is pretty hard to steal textbooks and turn them into cash,
although I guess you could do it.
Dr. Shah. Thank you.
Chairman Berman. The time of the gentleman has expired. The
gentleman from California, Mr. Costa, is recognized.
Mr. Costa. Thank you very much, Mr. Chairman, for this
important hearing. And thank you, Dr. Shah, for the good work
you are doing.
I am going to cover your efforts in a host of countries
that we are focused in, and I would like some quick responses.
Obviously it was noted earlier about our efforts with regard to
Gaza and the West Bank. How would you assess the results of the
infusion thus far of aid that has been provided, and the
Palestinians' ability to absorb the large amount of American
aid, quickly?
Dr. Shah. Well, we track that very carefully before
making----
Mr. Costa. No, I know, you noted that earlier.
Dr. Shah. Right.
Mr. Costa. How would you assess it?
Dr. Shah. So I think there has been more success in some
areas than others. There have been successes in infrastructure
and the development of road networks and building schools.
There have been successes in health, in particular with
building a stronger health system.
I think there are real challenges, especially in Gaza,
where there, for a variety of reasons, have been issues with
both transport mobility of goods and individuals, as well as
some interference. And so, so there is much to do to improve
the effectiveness of those efforts, and we are working, through
our diplomatic channels, to help improve that.
Mr. Costa. I would like you to provide at a later date
written notice of both those challenged areas. In Afghanistan
and Pakistan, obviously those are harsh environments. Many of
us have visited those countries in the past.
It is my understanding that USAID personnel are only there
for a year at length. However, as we know, after the year ends,
most people are getting their feet on the ground, getting some
level of understanding of local knowledge. Do you think that is
too short of a time period, as they are just becoming to be
experts in their field? Are you considering extending the time?
Dr. Shah. We would like to encourage them to stay for
extended periods of time. We are doing a number of things to
facilitate a more effective personnel situation in Afghanistan
in particular, related to improve----
Mr. Costa. That could be an administrative change, couldn't
it? I mean, if you provide the opportunity to extend beyond a
year?
Dr. Shah. Well, we have to balance that with our recruiting
and hiring and on-boarding process, and making sure we have
enough numbers.
Mr. Costa. What if an individual decides, in Pakistan or
Afghanistan, they would like to stay beyond a year? What is the
normal course?
Dr. Shah. They absolutely can, if they would like to.
Mr. Costa. Okay. As it relates, I have had a little bit of
experience with some folks from my area who have actually taken
the time and contributed to build a hospital in Afghanistan
outside of Kabul. I have seen where some of the other money
that has been spent by us, where we have had a lot of problems
with corruption.
It just seems to me that we don't have it right yet, in
terms of how, whether we are building a road, whether we are
building a school, whether we are building housing, or in this
case a hospital. For $2 million they were able to build a
state-of-the-art hospital in Afshar, Afshar Hospital; 120 beds
with seemingly no corruption that was involved.
What are you guys doing to figure out how you can avoid or
learn from your past mistakes?
Dr. Shah. Well, first I will say I am aware of that
hospital, and appreciate the advance that that represents in
the work from members of your district.
I do think our work in Afghanistan is tracked quite
closely. Health is a good sector example. We were very
selective in working with the Ministry of Health. It took a
number of years to build the financial management and
procurement system and other tracking systems to give us the
confidence that we could enter into the agreement we entered
into with them last year.
We have now started to flow resources through that
ministry, but we track every procurement action quite
carefully. We monitor every strategic decision. And in addition
to that, we have a series of audits that take place, both from
our IG and the Special Inspector General, to make sure that
those resources are being spent effectively.
As a result of our health sector investments, we believe we
have more than tripled access to the health system for the
population of Afghanistan, and we think that is a tremendous
achievement. We are very optimistic in that space.
Mr. Costa. Quickly, before my time expires, Mr. Chairman, I
would like to see us maybe do more work as it relates to
determining how well we are applying smart power, and to ensure
that the money is going into the right places.
Which brings me to Iraq. What would you say, as we ramp
down and USAID ramps up in Iraq, are the lessons learned from
the experience of the Department of Defense?
Dr. Shah. Well, sir, I think there are a broad range of
lessons learned. Some relate to contracting, and the risks of
very large and poorly supervised----
Mr. Costa. And you are going to apply those lessons?
Dr. Shah. Absolutely. We have a contracting reform effort
underway.
Mr. Costa. And finally, what do you think your biggest
challenges are this year?
Dr. Shah. Well, our efforts in Afghanistan, Pakistan, and
Haiti, as well as our health and food efforts. When you put all
that together, we will severely strain our work force. And so
building a strong work force and our ability to do that will be
pretty critical to success.
Mr. Costa. Thank you very much.
Chairman Berman. Thank you, Mr. Costa. Your time, the
gentleman's time has expired. And now the gentleman from
Minnesota, Mr. Ellison, is recognized for 5 minutes.
Mr. Ellison. Thank you, Mr. Chair. And thank you, Dr. Shah.
And let me add my voice to everybody who has thanked you and
the administration for the speedy response in Haiti.
I represent Minneapolis, Minnesota, and we have a large
Somali community there. And they are all--not all, but mostly
all concerned about, you know, what is going on in Somalia.
And I realize that the United States reduced its funding to
Somalia last year after OFAC expressed fear that the extended
supply line in insurgent-heavy areas where aid agencies were
operating meant that aid could be diverted to al-Qaeda-linked
groups.
But on the other side of the coin, the people at the U.N.
have expressed concern about that, because it results in a net
reduction to food to people who need it desperately.
What are the things that you think could be done to
straighten this situation out? And do you care to offer some
views on this?
Dr. Shah. Certainly, thank you. Well, first I will start by
saying that we will follow and respect the law and the guidance
around protecting and stewarding effectively U.S. resources.
We have been in a very in-depth conversation with the World
Food Program, and they have made it--they are our primary food
distribution partner, as you point out. And they have been very
clear with us that this is not, that our policies are not
impeding in any way their capacity to distribute food at this
time. They are not distributing food more aggressively in
Southern Somalia for their own safety, security, and logistics
capacities to do so in a difficult operating environment. So
that is not the current constraint.
We will work with them, if that becomes the constraint, and
they have the ability to distribute food that we have to offer
to them. If they agree to do that, then we will work with them
to make sure we have a policy in place that supports those
efforts.
Mr. Ellison. Well, I am going to just submit this article
for the record, with unanimous consent.
Chairman Berman. Without objection, it will be included in
the record.
[The information referred to follows:]Ellison
FTR deg.

Mr. Ellison. And I will send it to you. And perhaps we
could flesh out a stronger answer, because I would like to get
to the bottom of this. Because it seemed that there was some
sort of technical requirements that we are being restricted,
and I am sure you are aware of the complaint. It sounds like
you are saying that it may be not a valid complaint. But we
will----
Dr. Shah. Yes. Okay, I am sorry. What I was suggesting is
we have worked through that, and they are now in a different
circumstance.
Mr. Ellison. Okay.
Dr. Shah. And the circumstance they are in right now, and
we are in very direct communication, is that that is not an
operating issue any more.
Mr. Ellison. That is great, great. Next is, you know, thank
you for the work that you do to support the people in Gaza. Do
you think that USAID could be more effective at its work if
USAID personnel were able to enter Gaza? Have you reviewed a
process by which USAID personnel might actually be able to
enter, and not just work through surrogates?
Dr. Shah. Well, as a general principle, we do believe that
our presence allows for improved effectiveness. We are
reviewing a broad range of things we can do to improve the
operations in Gaza, that include working with partner agencies,
U.N. agencies more aggressively; working the diplomatic
channels to reduce some of the issues in that department.
Mr. Ellison. I am sorry, Doctor. USAID is working through
surrogates now. That is already happening. I want to know, do
you think it would be an advantage to having USAID personnel in
Gaza, you know, since we are already in other tough areas, like
Afghanistan, Iraq, and others?
Dr. Shah. Well, I think the core constraint for us right
now is actually mobility, getting items in, and a series of
specific issues with respect to interference from Hamas and
others in that environment.
In that context, it is not clear that sending our people in
is the immediate resolution to that. I think the immediate
resolution to that is solving those problems as a precondition
to that. And so we are working with others to do that.
I am happy to review this more specifically, though, and
come back to you with a more specific answer.
Mr. Ellison. Yes. And you know, there are, I mean USAID
does operate in Gaza. And do you feel that the UNRWA is doing
all it can to keep materials and supplies away from Hamas?
Dr. Shah. Well, you know, we believe UNRWA is an incredibly
important partner, and needs to be successful at their efforts.
And so we work in coordination with them.
You know, I think we all can do a better job at any number
of things in Gaza, which is a very difficult operating
environment for the reasons I was identifying.
Mr. Ellison. Thank you, Doctor.
Chairman Berman. The time of the gentleman has expired. And
the gentleman from New York, Mr. McMahon, is recognized for 5
minutes.
Mr. McMahon. Thank you, Mr. Chairman, and Director, it is
good to see you again. And I am sure I want to join in that
chorus of all those who have thanked you and your agency for
the great work you are doing in Haiti in responding to that
emergency there, as well. And I know the people of Chile need
your assistance, as well, and that America is doing that. And
you kind of put a little polish on the reputation of our
country being able to respond in an effective manner, and that
is something that the American people are grateful for.
I also want to thank you for your assistance in allowing
the New York City Search and Rescue Team to get down there to
Haiti. And as you know, we put in a resolution recently, under
the chairman's leadership, commending USAID and the civilian
emergency response team, as well as the military response team.
And we are grateful for that.
Dr. Shah, I want to follow up a little bit on the Gaza
questions that my colleague from Minnesota was asking. The
President's request included $400.4 million in economic
assistance for the West Bank and Gaza to ``strengthen the
Palestinian Authority as a credible partner in Middle Eastern
peace, and continue to respond to humanitarian needs in Gaza.''
The request also states that this assistance will ``provide
significant resources to support the stability of the
Palestinian Authority, economic development into the West Bank,
and increase the capacity of the Palestinian Authority to meet
the needs of its people.''
Dr. Shah, I would like to reiterate the importance of
vetting this funding, and of course, supporting Israel. Just
yesterday the U.N.'s Under Secretary for Humanitarian Affairs,
John Holmes, dismissed Hamas's cross-border raid in 2006, the
kidnapping of Staff Sgt. Gilad Shalit, and Hamas's unacceptable
calls for Israel's destruction by condemning Israel. Of course,
he completely neglected to mention the fact that despite
Hamas's aggression, Israel allows daily shipments of food,
medicine, and other supplies.
Given these statements, and to follow up again to my
colleague from Minnesota, how will USAID make sure that this
funding does not end up in the hands of terrorists,
specifically when we are partnering with organizations like
UNRWA? What sort of safeguards are in place? And if you can be
as specific as possible.
And also, if you could provide an assessment of the
effectiveness of USAID to Palestinians over the past several
years. Which economic projects have been effective, and which
have not? Has U.S. assistance helped increase popular support
from moderate Palestinians in the West Bank, a goal which we
all support? And what role is United States aid playing in
helping to strengthen governing institutions in the West Bank?
Basically, are we making a positive impact?
Dr. Shah. Thank you for those comments with respect to
Haiti, and the questions with respect to Gaza and the West Bank
and Israel.
You know, we do have, as I had noted, we have a very
rigorous system for vetting partners, and for tracking any cash
disbursements all the way through to their end use. On partner
vetting, we have a very sophisticated system; it has been in
place for more than 2 years. It tracks the names of all our
partners, that clearly vets all key personnel in any partner
organization against a larger database, and that allows us to
follow up on any positive hits that occur in that tracking
system.
After we get any positive hits, we have an aggressive
process of investigation and review before going forward. So
that is a very robust system.
The cash tracking system is similarly robust. We track any
authorized disbursements. We transfer resources through an
Israeli-based banking account into a special Treasury account
in a Palestinian bank, and then we monitor all flows out of
that account by every single disbursement being tracked
specifically to its end use.
Most of these disbursements, or nearly all of these
disbursements are used to pay off creditors, so those resources
go back out to other places.
The question with respect to how are we coordinating with
other partners, and what can we do to improve effectiveness, I
will just say I spoke to John Holmes before he went to make the
point that you are making, that our goal is about effectiveness
in that environment, and that we need to look at the whole
picture. It is the PRM program that primarily partners with
UNRWA, and not USAID, although we believe that that is an
important partnership going forward. So we will continue to
have those safeguards in place.
On effectiveness, you know, there are some areas we think
have been more effective than others. Health and education have
been perhaps more effective than the full portfolio of
infrastructure investments, which are more complex to
implement, although there have been some success stories there,
as well, in the West Bank in particular.
In Gaza, with the mostly humanitarian mission, it is a
different operating environment.
Chairman Berman. The time of the gentleman has expired. And
with an impressive show of efficiency of time, Mr. Connolly,
within 45 seconds after entering the room, is recognized for 5
minutes of questioning.
Mr. Connolly. Thank you, Mr. Chairman. I am sorry I am
late, but we had a weekly breakfast meeting with the Speaker
and the freshman class, and it went a little bit over. So
please forgive me, Dr. Shah, for coming in so late. And I thank
the courtesy of the chairman for allowing me to continue
nonetheless.
Dr. Shah, one of the concerns I certainly have, and I know
other members of the committee do as well, is that in some
ways, USAID has been hollowed out in the last decade. And I
would hope that part of your mission is to turn that around.
We had Secretary Clinton here in her first appearance
before the committee--she has been here since--who is certainly
committed to doing that. But we have seen, for example, a
proliferation of aid-related missions that are not, however,
part of USAID. The Millennium Project, and the AIDS Project,
and on and on. I would even argue that an awful lot of the sort
of funds that are used by the military in Afghanistan and Iraq
really ought to be projectized aid, and they are being managed
by our military, and hopefully well. But those sums are now so
substantial, one is concerned about what could go wrong, and
would maybe preferably have them in the hands of professionals.
I wonder if you could address that subject, that whole
question of how do we consolidate, how do we make sure you are
the go-to person for bilateral and multi-lateral U.S.
assistance? And that we remake USAID into a cutting-edge
development agency that actually does something, and isn't just
a place that facilitates contracts with others?
Dr. Shah. Thank you very much for that comment and that
statement. I believe that right now is an incredibly unique
time to seize the opportunity to rebuild USAID as the world's
premiere development agency. I think we have a President and a
Secretary and an administrator completely committed to that
goal, and we have such strong leadership and support in the
congressional committees and in Congress to achieve that
outcome.
I also believe development is a discipline. And I think it
is a professional discipline that needs to benefit constantly
from the learnings of the past and the learnings of the
present. And we need to represent excellence in the practice of
that discipline on behalf of all development activities.
Our game plan for reestablishing our effectiveness and our
transparency, our accountability and our operational
excellence, is really to focus on a handful of strategic
priorities. We will focus our work in Afghanistan and Pakistan
and try to show clear results against clear strategic metrics,
in Haiti and in our series of key issues, like health, food,
security, and climate change.
In each of these areas, USAID can show, through
restructuring how we do our work, that we can have more impact
for less; that we can serve as a whole of government platform
that invites in other partners in a manner that is directed
against specific goals and specific outcomes, and that makes
tough choices about how we use resources so we get the most
bang per buck of our spending, as we tried to do in the relief
effort around Haiti.
We are also pursuing a set of operational improvements, and
I want to thank the Congress for its leadership in allowing us
to have the Development Leadership Initiative and rebuild the
actual Foreign Service Corps of this agency, which you are
right to point out has been decimated over the past 15 years.
We think we have a strong position. We have more than 4,000
Foreign Service nationals that represent people with PhDs and
medical degrees, and are entirely capable leaders that any
other private company would think of as a tremendous core
asset, for a more globally interconnected world.
We need to rebuild our Foreign Service. We are doing that
at the mid-career technical level, and we are doing that
through the DLI.
Mr. Connolly. If I may interrupt you, because my time is
going to run out, but count me as an ally in that effort.
Dr. Shah. Thank you.
Mr. Connolly. The lead development agency, as far as I am
concerned, in the United States Government has to be USAID. Not
the State Department. You are the hands-on guys, you are the
people with the experience, and you just enumerated that. And
that is what we have got to work with.
In my 49 seconds left, one thing I just want to sort of put
in your cap. USAID does provide funding both to NDI and IRI
through various spigots. One of the concerns I have had about
their work is that democratization works from the bottom up,
not the top down. I would like to see a much enhanced effort at
working with local governments in those programs.
Quite frankly, I think we haven't done such a good job over
the years in doing that. We have tried, but it is a hard
mechanism. But they are going to take their lead from where the
money flows. And I would hope that you would take a look at
that. Because I think we have the, if we really mean it about
democratization, the place you build that is at the local
level.
Thank you, Mr. Chairman, my time is up.
Dr. Shah. Thank you.
Chairman Berman. The gentleman's time has expired. I thank
him for echoing some of my sentiments on these issues, an
unusual occurrence. And given the time if it is all right with
you, I am going to recognize myself. No, I am sorry, Mr.
Rohrabacher is here. You are next, Mr. Rohrabacher. The
gentleman is recognized for 5 minutes.
Mr. Rohrabacher. Thank you, Mr. Chairman. How much aid have
we provided to Afghanistan since 2001?
Dr. Shah. I am not sure of the precise number since 2001.
Mr. Rohrabacher. Well, how much have we provided this year?
Dr. Shah. Well, this year we are proposing, in the Fiscal
Year 2011 budget, that we would be spending $3.9 billion. That
is down from $4.4 billion in 2010, when you include the
supplemental amount with the enacted amount.
Mr. Rohrabacher. Okay. And how much will we be providing
Iraq?
Dr. Shah. I believe that is going down, as well, from $700
million to around $400 million, but I will double-check those
numbers for you.
Mr. Rohrabacher. So with Iraq it is going to be 400. And
what are some of the programs we are spending $400 million for
in Iraq?
Dr. Shah. Which programs are priorities in Iraq?
Mr. Rohrabacher. Right.
Dr. Shah. We have, well, our immediate priority is support
for the elections, and successfully completing the elections.
We are also supporting the potential government transitions and
ministries through a support contract that will work in the
aftermath, that are currently up and running, but will also
continue through that critical 4- to 6-month period after the
election. And in addition to that, we have a number of programs
in health and education, economics and agriculture in
particular.
Mr. Rohrabacher. Do you have the figures with you in terms
of how much we have spent, how much aid has been spent in Iraq
since the liberation?
Dr. Shah. No, not at the top of my fingertips, but I will
follow up on that.
Mr. Rohrabacher. Maybe you can tell us of the almost $4
billion, $3.9 billion that will be spent in Afghanistan, what
are some of the programs that Afghanistan will be receiving?
Dr. Shah. Sure. Well, we have restructured our Afghanistan
portfolio to be aligned with and very much a part of the
President's Afghanistan strategy. We have had two major
strategic reviews in March of last year, and in December, when
the President's strategy was announced by the President.
The priorities going forward are agriculture, which is the
largest employer of individuals outside of the government in
Afghanistan. Our investments there have peaked this year at
around $820 million; will come down to $425 million in the 2011
spending. But that continued pipeline of investment will be the
single-greatest investment in productivity centers and in
agriculture. And we are encouraged by some of the early
outcomes with respect to performance in that sector.
We also have major investments, and will continue with
major investments, in health and education. The health sector
is a sector where we are partnering closely with the Ministry
of Health. It has been a number of years in the making to
develop a really robust partnership with strong auditing trails
and financial accountability for our spending, and our
priorities are on building an effective tertiary-care health
system and effective primary-care health system, and getting
health access out into rural areas to serve the needs of women
and children in particular, to most effectively reduce some of
the disproportionate health harms in that context.
We have a broader range of activities in partnership with
other departments and the State Department that include
security, rule of law, counter narcotics. But the USAID-
administered programs will focus in the areas I described.
Other economic growth priorities include roads and power,
as well.
Mr. Rohrabacher. So how much did you say was being spent on
agriculture?
Dr. Shah. Well, the Fiscal Year 2010, when you include the
supplemental, is around 820. And the Fiscal Year 2011 request
is around 425. That is agriculture and food security, including
alternative livelihoods in rural communities, not including
counter narcotic activities.
Mr. Rohrabacher. Not including----
Dr. Shah. Not including counter narcotic.
Mr. Rohrabacher. And could you give us an example of some
of the agricultural spending that we have got?
Dr. Shah. Sure. We have programs, well, first we work in
close partnership with the U.S. Department of Agriculture,
where they are providing significant technical support to
ministries and the public sector system. And we are very
focused on supporting the private sector.
We have farmer support programs that are getting seed and
fertilizer out to farmers through a voucher-based private-
sector system. We have programs to help farmers produce high-
value products, like apples, and then export them in the
region, so they have sources of cash and income in addition to
the production of basic foodstuffs. And we are working to
develop improved access to agricultural credit, so that farmers
can really support their own pathway out of poverty through
agricultural development.
Mr. Rohrabacher. Thank you very much, Mr. Chairman. Thank
you.
Chairman Berman. The time of the gentleman has expired. I
am going to recognize myself for 3 minutes, and Mr. Smith for 3
minutes.
And I just want to follow up a little more specifically on
some of the points raised by my colleague from Virginia. In the
context of what the Secretary has referred to as a key foreign
policy priority--that is, development and rebuilding USAID as
an institution--specifically, could you talk about the
restoration of a budget development capacity and a policy
planning capacity within USAID? And also, in the rebuilding of
the staff with the goal of doubling the number of Foreign
Service officers, to the development leader initiative, your
priorities for hiring and recruitment of new people at USAID.
Dr. Shah. Thank you, Mr. Chairman. We have a strong effort
underway, through the QDDR, to partner some of our new staff
with the members of the F Bureau, to identify really a revised
and improved budget process that would allow USAID to be
financially accountable for the resources it spends.
It goes without saying that in order to be the world's
premiere development agency, we have to be able to account for
our spending, and be held to account for resources that are
spent in a transparent and clear manner. And so we are actively
working on that, through the QDDR and through other processes.
On the policy----
Chairman Berman. What about on the impact of developing--
the accountability is very important. But the question is, are
you handed a budget, or do you get to develop a budget?
Dr. Shah. We will get to a place where we have the
opportunity to develop a budget, working in partnership with
others. But we clearly need to be able to make strategic
resource tradeoffs in order to be held accountable for the
performance of the agency.
On policy planning, similarly, sir, we are building an
active policy-planning capacity. I am pleased to announce we
have had real leaders in the field, like Ruth Levine from the
Center for Global Development, that just joined our team. We
hope to have a world-class innovative evaluation capacity that
helps us learn from direct program beneficiaries, through text
messaging all the way through doing a range of other efforts,
to do randomized control program trials to understand the
impact of our work most effectively, and rebuild our policy
planning and evaluation capacities.
On staff, we have now hired in 420 individuals through the
DLI. We respect the great leadership Congress has provided. My
priorities are to sort of relook at how we do deployments, and
more rapidly deploy the DLI individuals to our core strategic
and operational priorities, and shorten the length of time that
they are in the current training program.
Chairman Berman. My time has expired. The gentleman from
New Jersey is recognized for 3 minutes.
Mr. Smith. Thank you very much, Mr. Chairman.
Dr. Shah, as you know, WHO estimates that up to 70 percent
of health care in Africa is provided by faith-based
organizations. The Catholic health care alone in Africa
constitutes about 40 percent. We know that a number of other
groups, Samaritan's Purse, World Vision and others are all
doing yeoman's work there. They provide expertise,
infrastructure, trust to the people, and an enormous number of
volunteers that otherwise might not be utilized. And their
ability to expand is incredible.
What is your view of increasing the partnership with faith-
based organizations and NGOs, especially as it relates to
implementing the Global Health Initiative?
Dr. Shah. Thank you for that observation. I believe that
the partnerships and bringing those partnerships into a whole
health system construct will be critical to the effectiveness
of the Global Health Initiative. So I would see whether it is
in Kenya or other countries, where there are significant faith-
based organizations running hospitals and doing that work, and
where we are involved in providing support. Our goal is to
bring that support within the context of the health system, and
to make those more formally part of an integrated national
health plan.
So it absolutely involves expanding and deepening our
partnership.
Mr. Smith. I hope you would be mindful that in some
countries where church opposition to human rights abuses has
been very strong, when integrated partnerships are formed and
the government health ministries and others might be less than
quick to want to embrace the faith-based community, I would
hope that we would play a very positive role in suggesting, you
know, when it comes to health care, we want the maximum impact.
And certainly it seems to me--and I know in places, and I
have been throughout Africa--usually when there is corruption
or human rights abuse by a dictatorship or an authoritarian
regime, it is reflected in other parts of that government when
it comes to partnering. So they shun those partnerships in some
instances. So I would hope that we would help to overcome that.
Dr. Shah. Thank you.
Mr. Smith. And finally, in 40 seconds, in reading the
enterprise results reporting, I understand that there is some
real problems with meeting the 50 percent goal of providing
micro-financing to the poorest of the poor.
Could you take a second look at how we might be able to
reach out to those NGOs that are actually meeting, you know, we
had a big fight, we did the reauthorization in 2004. I know,
because that was my bill. And there is a lot of tugs and give-
and-take.
But when it comes to the NGOs that are there on the ground,
providing maximum benefits to the poorest of the poor, the goal
is a real one. I think it is achievable. So please take a
second look at that.
Dr. Shah. We will.
Chairman Berman. The time of the gentleman has expired.
Because of the service for our late colleague, Congressman
Murtha, we are going to adjourn the hearing. We thank you very
much for being here. We look forward very enthusiastically to
working with you in the future.
[Whereupon, at 10:48 a.m., the committee was adjourned.]

A P P E N D I X

----------

Material Submitted for the Hearing RecordNotice deg.

Minutes deg.

Berman statement deg.
__________

Watson statement deg.
__________

Engel QFRs deg._

Ros-Lehtinen QFRs deg._

Lee QFRs deg._

Bilirakis QFRs deg._