It is more able to deliver the development product. It can achieve results.

It was, and is, the best development agency in the world, an agency that other donor agencies depend upon.

All of these efforts would be wasted if this legislation passes. We would have to abandon the effort to do more with less as we attempt to do less with less, in an entirely new, more difficult, management environment.

It would be exceedingly difficult for the State Department to absorb USAID and exceedingly difficult for USAID to be absorbed.

Mr. Chairman, I cannot understand why this merger issue is being pursued against the best advice available in the executive branch.

If this committee and the Senate committee persists, our foreign policy agencies will be thrown into complete disarray.

I know you too well, Mr. Chairman. I cannot believe that is your intention.

Thank you.

[The prepared statement of Mr. Atwood appears in the appendix.]

Chairman GILMAN. Thank you, Mr. Atwood. Dr. Duffey.

STATEMENT OF THE HONORABLE JOSEPH D. DUFFEY,
DIRECTOR, U.S. INFORMATION AGENCY

Mr. DUFFEY. Thank you, Mr. Gilman, Mr. Hamilton, members of the committee.

I have a written statement to submit and a supplementary statement about the current work of USIA, which I would like to have entered into the record, though I might keep my comments brief at this time.

Chairman GILMAN. Without objection.

Dr. DUFFEY. I want to thank you for your courtesy and consideration in making this hearing available in which we can discuss the specific terms of the legislation that is before this committee. And I will supply more technical comments at a later point.

It is clear that there is emerging now with new seriousness a consideration of how this nation should conduct its affairs and define its vital interests in a post-cold war era.

In 1991, 2 years after the fall of the Berlin Wall, a study was published with a number of American foreign policy experts that was entitled "Changing Our Ways."

We are still in that discussion trying to determine, both on the basis of resource and interest, how our ways will change after the long, all-defining period of the cold war.

However, in this process, the needs and values of the American people must continue to be the touchstones of our foreign policy.

As the Director of an agency whose entire mission is focused on understanding, engaging, and influencing publics abroad, I am particularly sensitive to the concerns of our own public here at home. And I share with many Americans the conviction that our first concern must be to renew and preserve the promise of our own American dream at home.

But I am convinced that Americans know today that global engagement remains both a fact of life and a requirement for shaping

the kind of world which will make possible the pursuit of our dreams for this nation.

This is a world in which Americans have opportunities, new opportunities that very much relate to our own prosperity in the future, and to our fulfillment of our own values is a world in which we have much at stake.

The bill that is before this committee proposes to reorganize several of our Government's foreign affairs agencies with the goal of affirming, once again, the preeminent role of the Secretary of State in the creation, implementation, and coordination of our policies for dealing with this complex world.

I understand that the intent of this consolidation proposal is to create a future-oriented foreign policy apparatus which better serves U.S. policy and the American taxpayer.

But I would respectfully submit, Mr. Chairman, that this proposal is not the best way to achieve those goals. On the contrary, I agree with Mr. Atwood, it may do more harm to the process of change that is now underway in the foreign policy community than contribute to that agonizing process in which we are now engaged of finding new ways of changing our ways.

For those of us who appear before you today, change is not something that begins with this hearing or this legislation. We have been at work, as has been this administration, months and now 2 years into the process of casting off out-dated programs, reducing personnel levels, adapting to new domestic and international conditions, doing our work with greatly reduced resources.

We have more months and years of change ahead of us.

The reforms which we are implementing each within our agencies are designed to address the new budget realities but also to adapt and strengthen our specialized expertise so that separately and together we remain effective tools for the pursuit of U.S. foreign policy goals in a world in which such specialized talents are more relevant and necessary than ever.

All the agencies before you work for the Secretary of State. We are, nearly daily, in consultation and coordination. I believe Mr. Moose has made the argument that the Vice President made in his letter to the Congress in February that it flies in the face of everything we know about the change of organizations and creative management to lump all of these organizations together.

What we are trying to do as a nation-the word we now use is “engage” the rest of the world is a complicated process that has many levels of interests and expertise to it.

It is in our interest to be in contact, as USIA often is, with the minority parties in another major government. It is in our interest to build and strengthen relationships between private institutions in the nonprofit and in the business world, just as it is in our interest to daily engage the official government policymakers of other countries the central focus and mission of our Department of State. But I think we can look back at history and look at the present, look around us presently, and see how these agencies as specialized divisions of a foreign policy community can work together far more effectively than they could were they lumped together in one large, massive further bureaucratically hampered organization.

Since 1989, USIA-AID officers have been cooperating together under the SEED program envisioned by the Congress as a multiagency endeavor to strengthen democratic institutions and promote economic restructuring in Poland.

A look at our success there working with the Polish people in independent media training and small grants for entrepreneurial development in the private sector illustrates the ways in which these organization work together.

Earlier, Mr. Chairman, I delivered to your desk copies in Russian and English of a new publication: "Trade With America." This demonstrates two facts about the last 2 years in this administration.

Number one, the move to concern ourselves with those policies that enhance the prospects for prosperity and investment and trade that serve the interests of the American people are vital national interests; and also the coordination achieved by the agencies that are represented at this table, each with a program and an emphasis that fits together, many of which could not be conducted in one super agency because they are related. But they are separate pieces of an important task.

I think that is the case in South Africa, an even more dramatic example of how our specialized missions and expertise contribute and continue to contribute to pursuing the goals of this country and the world.

The USIA, for example, has played an important role in America's long-term commitment to the establishment of a democratic, multiracial, new South Africa.

The library in Johannesburg for 50 years, joined later by USIA centers in Cape Town and Sowetho, were tangible symbols of American commitment to openness, to open societies and human rights.

Those programs were often the few places that South Africans of all races could meet during the period of oppression in that country. There were many times when the official positions of the United States created blocks to understanding and relating to many of majorities of that nation. We had an agency that could work, that was a part of our Government, worked in coordination with our other agencies but had a highly specialized task.

Today, USIA, USAID, the Department of State work together with the Department of Commerce, the Eximbank, and other agencies to strengthen prospects for trade and investment ensuring a response to the inspiring attempt to build a multiracial society and set a model both for the rest of Africa and the rest of the world. We are hard at work in that process. USIA has been engaged in the last 2 years in changing itself. We have a budget before you that asks for $120 million less than the budget we brought last year. That is not a November conversion by USIA. We began to plan for that 2 years ago, recognizing the realities that are before

you.

Of the savings achieved in the 150 account, with 6 percent of the budget, USIA has contributed about 58 percent of those savings.

I would like to end by asking you to consider the human impact of mandating, here in the Congress, against the best judgment of those who are closest to the work this kind of coordination.

We have to work our way now throughout the Federal Government through a very difficult period of transition. It has to do with our minds, our expectations, our sense of the role of this country. But it also has to do with the practical instruments of government. And in those agencies, there are men and women like the ones with whom I work, who have taken on this task of change. We must be concerned with finding a process that humanly seeks this change. We have got to be concerned with retraining. We have got to be concerned with transition for the people who will be leaving the government as jobs are reduced.

One of the things that I think we must consider is that many of the members of this committee have companies in American society going through downsizing in their own districts. They know how we have seemed to have left behind in this country the expectations we once had that employers would do this with some humane concern for the human resources that are involved.

The people who work in the government in our agencies did not create this problem. They have contributed their skills and their lives and their professional careers to serving the country. We must now respond to them. We must involve them in the process and create a process of transition through the new size and scope of the government we need in the future, the kind of government, the flexible that is as well managed as the best parts of the American business community and private sector.

But we must do that with more sympathy for the human beings involved and for the transition process than we often see about us in the commercial sector today. So I hope the Congress will expect of itself the same kind of concern for the men and women who are going through this transition as we all should continue to expect of the American business community.

I say that as an argument for an understanding of the process that has begun and for the opportunity-and as a plea for the opportunity to work with the Congress through this transition to the new era and the new ways which will continue to serve this country in its vital interests.

Thank you.

[The prepared statement of Dr. Duffey appears in the appendix.] Chairman GILMAN. Thank you, Dr. Duffey.

Mr. Earle.

STATEMENT OF THE HONORABLE RALPH EARLE, DEPUTY DIRECTOR, UNITED STATES ARMS CONTROL AND DISARMAMENT AGENCY

Mr. EARLE. Mr. Chairman, Mr. Hamilton, members of the committee:

Thank you, Mr. Chairman, first for this opportunity to testify. Thank you for agreeing to place my formal statement in the record. And thank you also for the opportunity to comment further on the technical aspects of the bill. I believe we will take advantage of that offer.

It will come as no surprise to you, Mr. Chairman, that I will use this opportunity to testify as articulately and as carefully and as thoughtfully as I can in opposition to the pending legislation which

would, among other things, abolish the U.S. Arms Control and Disarmament Agency.

I have come here this morning from New York, and will return there immediately after this hearing, where I am chairing the U.S. delegation to the Conference on the Extension and Review of the Nonproliferation Treaty, which has reached a critical point and, hopefully, will end successfully from our point of view at the end of this week.

At the same time that I have been doing that-and will continue to do it the agency's Director, John Holum, is in Moscow with the President and the Secretary of State participating in negotiations on arms control and nonproliferation with Russian leaders.

I must be candid, Mr. Chairman, and tell the committee that the legislation before you would pull the rug out from our country's efforts to negotiate arms control and nonproliferation agreements.

And make no mistake, the bill before you takes a vital part of national security that ain't broke, breaks it, and then asks the taxpayer to spend millions to pick up the pieces.

By arbitrarily shuffling organizational boxes, this bill would undercut the American's people security in this very dangerous postcold war environment.

With respect to arms control and nonproliferation, the bill before the committee has, in our view, at least four fundamental flaws. First, it replaces a good decisionmaking process with a defective process.

Second, it undermines America's arms control expertise.
Third, it blinds America where we need to see.

And, fourth, it costs more than it saves.

And I would like to address each flaw in turn.

First and foremost, this bill reduces the power and suasion of the nation's top arms control advisor. It eliminates his ability and the ability of his agency to argue the arms control case directly to the President and to the National Security Council, as well as the rest of the bureaucracy.

Under the bill, all arms control and nonproliferation decisions would be made at lower levels and not by the most senior officials of our Government.

Of course, when the government speaks abroad, it must speak with one voice. And, of course, it is the State Department's job to represent our country's interests.

But when the U.S. Government's policy is debated and formed internally, the President and his senior advisors must be able to hear an unfiltered case for arms control and non proliferation.

Those cases may not always prevail, but they should be heard— they must be heard.

An ACDA Director can go to the White House-and has done so the nation's benefit at critical times. An Assistant Secretary of State or Under Secretary of State, as envisioned by this legislation, cannot do that and would not do that.

If this bill had been in effect earlier and there had been no arms control agency, we would, today, have no nuclear Nonproliferation Treaty.