When you are talking about national security and foreign policy we have to be very, very cautious about finding limited savings that would prevent us from making the investments that we need to enhance the benefits that will come out of international engagement.

Mrs. MEYERS. Mr. Chairman, I thank you very much. I want to say that I think that the gentlemen have done a fine job, and their agencies have done a fine job. It is just that we are not going to be able to continue in the way that we have been in the past. And I think that it is going to require major policy changes and major structural changes. And it is going to be very, very difficult and probably traumatic for all of us.

Chairman GILMAN. The gentlelady's time has expired. Thank you, Mrs. Meyers.

Mr. Moran.

Mr. MORAN. Thank you, Mr. Chairman.

I am going to take somewhat the tact that the ranking member took. So the witnesses can sit back a moment. I want to put myself on the record as to where I stand.

You cannot underestimate the importance of the U.S. State Department today for every nation in the world. America's foreign policy as carried out by the State Department really holds the key to whether the 21st century is going to be one of worldwide peace and prosperity, or one that will be dominated by dictatorships and destruction, not only of our fundamental principles but of the peoples and the kinds of bridges that have been built since World War II between nations.

I think that we ought to be beefing up the State Department and not tearing it down. With regard to USAID, we need to bear in mind that every second of every day that four new members of the human race are born, and two of them will go hungry. And the people of the Agency for International Development and the know how that they carry with them is really the key to enabling their governments to feed those new members of the human race.

And unless we address the most basic fiscal needs of people particularly in Third World countries, they will ultimately become a threat to the most basic security interests of the United States.

With regard to USIA, I was just over in Belgrade, Serbia, and saw firsthand the impact of state controlled media. Most Serbs are not predisposed to kill Bosnian men, and rape their women, and pillage their villages. But when the state run television shows them pictures that purported to be of Serb babies being thrown to the animals in the Sarajevo zoo, when the truth is that the animals in the zoo also starved to death because the zoo keepers could not get to them because of Serb sniper fire. Or when the state controlled television brought out these vintage World War II photos and purported them to be pictures of Serb babies hanging on meat hooks.

Things that we cannot imagine could ever be taken seriously in this day and age, and yet there is no limit to the destructive power of state controlled propaganda when it is not countered with the truth that USIA has the capability of delivering throughout the world, particularly in places like Yugoslavia.

Likewise in Rwanda, all of the Hutus were not predisposed to massacre Tutsis. But when the state controlled, or I should say when the radio station that was controlled by the Hutu extremists continued to tell them about the kinds of massacres that were purportedly being carried out by Tutsis against Hutus, that had the kind of desired effect that ultimately resulted in the massacre of hundreds of thousands of people.

The point of bringing these examples up that would seem hard to believe in this day and age is that we desperately need an expanded U.S. Information Agency, Voice of America, and all of the related capabilities that we have for spreading the truth to people who otherwise would not have it.

And likewise and lastly with the Arms Control and Disarmament Agency, today's threat of nuclear, and chemical, and biological weapons is greater than it has ever been. The technological capability is greater than it has ever been. And it threatens the most ardent isolationist in the Michigan Militia, just as much as it does Foreign Service personnel in the State Department in Washington. It is the media threat to all of us.

And if we should be doing anything to protect America's security interest, it should be through the method of expanding the capability of the Arms Control and Disarmament Agency.

We are going in the wrong direction with much of the proposed legislation that has been suggested. And I would hope that the very fine knowledgeable people on the other side of the aisle that we are going to depend upon to moderate some of the extremism that we read about in the papers are in fact going to be heard, and their impact will be felt on the foreign policy authorization that will come out of this committee. And I hope that we will be able to work with them.

We cannot, as I said at the beginning, underestimate the importance of a very, very strong foreign policy structure. And to have the strength of that structure preserved, I think that we need to preserve the autonomy of the four agencies represented here today. Thank you, Mr. Chairman.

Mr. SMITH. The Chair recognizes Mr. Brownback.

Mr. BROWNBACK. Thank you, Mr. Chairman. I appreciate that. And I want to start by associating myself with Mrs. Meyers' comments. Although she has left the room, I think that she really aptly put the entire situation quite well.

I also want to congratulate the agencies for the success that you have produced. We have won a cold war. We have exerted U.S. leadership around the world, and have done a very fine job of it. It has been quite a successful mission that you have been on. A number of us look to moving on to some other missions now, as we go on forward.

I noted in both Mr. Atwood's and Dr. Duffey's testimony, that both of you state that with or without a merger, savings will only be achieved by eliminating programs or cutting personnel. I mean basically you both said that at one point or another in your testimony.

Is that accurate?

Mr. ATWOOD. Yes.
Dr. DUFFEY. Yes.

Mr. BROWNBACK. I presume in your response to Mrs. Meyers' comments that you were stating to her that what you would rather do is not be merged, but cut yourselves way back to achieve the savings that we are asking for.

Is that accurate?

Dr. DUFFEY. Well, I think

Mr. BROWNBACK. You rather not cut yourself back. I understand. Dr. DUFFEY. I think that we are confronting this. As I said, this is a foreign policy consideration. That we work together to manage the Federal deficit. It has to do with U.S. leadership around the world. But there are a number of steps that we are already taking.

For example, this past week, USIA and USAID culminated an effort that we have been engaged in for more than a year to combine our financial systems. USAID had developed a financial system, which we are adopting, saving taxpayers substantial funding.

Mr. BROWNBACK. I think that you have got some of that in your testimony of what you are doing now.

Dr. DUFFEY. Mr. Moose led us 2 years in combining our travel services. So there are a number of ways in which we can achieve those savings.

you

Mr. BROWNBACK. Dr. Duffey, how much do you think that could achieve savings-wise, what do you think that we can achieve percentage-wise of USIA functions by you staying on your own and cutting your own programs back to what we ought to do in a postcold war world, what percentage of savings out of USIA?

Dr. DUFFEY. Well, I think that we could meet whatever targets we need to meet. We have to determine that, and of course is one of the most critical things. USIA, of course, is a small agency. Mr. BROWNBACK. A 50-percent target?

Dr. DUFFEY. I think that 50 percent would be a very severe cut, and we ought to look carefully at the cost. But at USIA, this is not the agency that it was 2 years ago. There are a significant number of things that we no longer do, and have changed.

Mr. BROWNBACK. How long then to do this, how long do you think that it would take for you, say we say that you have got to come up with a 60 percent reduction in program funding, before you could come up with a plan or proposal to be able to do that?

Dr. DUFFEY. I think that is a steep target. I suggested it at the last of my remarks. I think that you want us to do this with as much consideration for the orderly conduct of business, and the protection of our national interest, and some consideration for the men and women whose lives, and families, and futures are involved.

So if we had the resources for transition training, the separation pay, the kind of elements that would enable us to deal with this over time, I think that we can meet whatever goals we have to meet.

Mr. BROWNBACK. Over a 1-year period of time?

Dr. DUFFEY. Excuse me.

Mr. BROWNBACK. Over 1 year?

Dr. DUFFEY. No, I do not think that can be done over 1 year. I do not think that any institution could make that kind of cut over 1 year. Obviously, it could be done.

Mr. BROWNBACK. Two years?

Dr. DUFFEY. Well, what is the figure, Congressman?

Mr. BROWNBACK. Sixty percent.

Dr. DUFFEY. Sixty percent. I have not heard that figure before, but 60 percent. We could come back to you with a plan, if that were the will of the Congress, and also with an impact. I am sure that the Congress would want to know what is the price we would pay. Mr. BROWNBACK. But you cannot give me a timeframe?

Mr. ATWOOD. Mr. Brownback, where I suggest that this line of questioning is leading us to is to suggest that we can develop a consensus between the parties and between the executive branch and the Congress as to what our national interests are, and I am not suggesting that we have yet done that in the post-cold war world. But I think that there is a lot of consensus about what our international interests are. And what you are questioning us on is how can you take these interests that are here and squeeze them into a strait jacket, which is your budget problem. Now this is a serious problem.

Mr. BROWNBACK. Our budget problem.

Mr. ATWOOD. That is what I said. That is our budget problem. We are all on a train toward trying to get this balanced budget by the year 2002. Everyone concedes that. But you also have to make investments in order to cause economic growth, which will produce revenues, that will also help us to balance that budget.

Mr. BROWNBACK. Thank you, Mr. Chairman.

Mr. SMITH. The time of the gentleman has expired. The Chair recognizes Mr. Menendez.

Mr. MENENDEZ. Thank you, Mr. Chairman. I want to first start off by thanking all of the witnesses for I think their excellent testimony. All of us come to this question from different ways. I am not supportive of the legislation.

I am not supportive, however, for various reasons, starting off with that the last thing I want to do is give one of the departments that I think is least responsive and least consultative in their process, meaning the State Department, even greater agencies to be less responsive to the Congress: agencies-having witnessed for over 2 years since I have been here-agencies that are very responsive to the Congress.

So, I ask my colleagues, when they are thinking about this to think about it in many different respects. You know, I have listened to my colleagues talk about smaller bureaucracies in the last several months. And yet today and in the days to come this week we are going to be talking about creating greater bureaucracies.

I have listened to the majority speak about decentralizing government and returning power to the States and to the people. And yet, this effort greatly centralizes government.

And so with juxtaposition of those views, I can only believe that in the mad fury of the meat ax approach to the budget problems we have, we find ourselves with a meat ax approach instead of with the surgeon's knife which is what I hear the testimony of the witnesses say that we are in this together. But there is a better way both fiscally and policy-wise to move ahead.

You know, I think it is very easy for these agencies to lose their missions when they become so subservient. Yes, we want inter

action and coordination. But not when they become so subservient as part of the State Department.

I have never seen it and I have colleagues here who have been here a lot longer, I have never seen someone in a subordinate position in the State Department go ahead and say, Mr. Secretary, you are wrong. And in arms development and proliferation, clearly we need to have that check and balance. And the members of the committee should be considering what are we losing the check and balance approach that we have with the independency of these agen

cies.

I think that we will also find as Members of Congress, representatives of the people here, that the critical questions such as those that, in terms of developing policy will be less detectable by Members of Congress and members of this committee, when these agencies no longer are before you independently, when they sit and reside within the State Department and the State Department decides who they send up here to testify.

It becomes even more difficult to ascertain what is the right question in developmental assistance? What is the right question in USIA projection throughout the world? What is the right answer to going ahead and development and questions of nuclear proliferation? I think it is going to be very hard for us to detect that on behalf of the American people.

Most management specialists will tell you that decentralized specialized units are always more effective. And I guess we are flying against the face of all of that. And I would like to just lastly put this question to Mr. Atwood. You know, I have seen and also to Mr. Moose, two separate questions.

One is we have heard a lot of my colleagues here talk about the values of foreign trade to our country, as it is proposed and what it can bring. You say in page 9 of your testimony that people simply fail to recognize today's global competition for goods, for ideas and for national advantage.

Mr. Atwood says that in some parts of the world, these cuts would clearly benefit the trade prospects for our economic competitors while undermining the growth of U.S. exports to developing markets. I would like to hear you expound upon that because that means money and jobs for Americans.

And lastly, Mr. Atwood, I want you to tell me if this analysis that I come to is wrong as it relates to development assistance. Trade alone will not solve some of the problems we have throughout the world. I do not see it solving the 50 percent of people below the poverty level in this hemisphere in and of itself. Developmental assistance is part of our foreign policy tool and it creates hope.

Now, if there is no hope, there is despair. And where there is despair, it kindles anger. And where there is anger, usually violence approaches. And when there is violence, unfortunately more times than not, there is more loss of life.

And what I see is us being dragged in because of these massive changes in both policy and cuts in developmental assistance into a situation which we will find greater immigration problems and also greater threats that we will find ourselves forced to respond to militarily. I would like you to answer those two questions. Thank you, Mr. Chairman.