I am pleased to welcome our witnesses, particularly our former colleague, Chairman Kolbe, who served as one of the most respected Members on issues involving foreign aid programs.

We are so pleased you could arrange your schedule to be with us here today, Chairman Kolbe.

As the Chairman pointed out, despite efforts over the years by some truly great Members of the House and Senate, such as Senator Hubert Humphrey and several former Chairmen of this Committee, including Dante Fascell, Lee Hamilton, Ben Gilman and Tom Lantos, we have not reformed the 1961 Foreign Assistance Act in any truly meaningful way since 1973.

I commend the new Chairman of our Committee, Mr. Berman, for committing to the task of both authorizing our assistance and overhauling our basic foreign assistance statute, which is now close to fifty years old.

Reform and updating the 1961 Foreign Assistance Act would entail addressing a range of truly difficult issues.

• We would need to look at the categories of assistance, their objectives and their associated programs.

• The Congress would have to focus on addressing questions concerning aid for development and whether the concepts underlying it – which go back to President Kennedy’s day – are relevant today and whether they are effective.

• We would need to consider the many, many restrictions, directives and earmarks that have been placed on our assistance programs --- something that would raise concerns among those of us, both inside the Congress and out, who see some policy prescriptions as vital to the specific efforts and programs we most care about.

• We would have to look at ways in which our foreign aid agencies and offices implement and oversee their particular programs. What we have today is something akin to a bowl of spaghetti with lines of authority and often-uncoordinated pursuit of objectives that are difficult to follow.

• We would need to look at the organization and structure of foreign aid agencies and offices, and consider, in a detailed manner, questions having to do with personnel, procurement, contracting and evaluation.

I credit Secretary of State Rice for trying to address much of this on her own, through the creation of the office of the Director for Foreign Assistance at the State Department two years ago.

However, that effort might not achieve the coordination and evaluation of our assistance that we would all like to see, and there has been no Congressional engagement in the creation of that new office.

Some have proposed the creation of a new cabinet-level Department of Foreign Development.

But the question is whether a new, centralized agency would simply follow in the path of AID.

AID was originally set up as a centralized agency in 1961, but, as demands changed, some of its programs were taken over or supplemented by spin-off agencies, entities and projects.

Thus, Cabinet-level status for a foreign development agency probably would not be enough to prevent the eventual spin-off of many aid programs, as a response to the need for specialized expertise in areas such as infectious diseases, trans-national threats, trafficking in persons, cyber-crime, and similar areas.
 
Therefore, I would like to ask our distinguished panelists:  What do you view as an alternative structure to respond to current and emerging challenges; dynamics; needs and priorities?

A recent commission established by the Congress to look at such questions – the “HELP Commission” –was unable to agree on this issue.
 
But the HELP Commission did prepare a draft bill that provides a basis for discussion today.  It places the onus on the President to develop a reorganization plan that would include:

“(1) the development, if any, of a new foreign assistance agency if the need is there;
(2) the abolition, if appropriate, of the United States Agency for International Development (USAID);
(3) the abolition or termination of functions of each covered agency as may be necessary to effectuate the reorganization…and the termination of the affairs of each agency abolished…;
(4) the transfer to the new foreign assistance agency of the functions and personnel of each covered agency; and
(5) the consolidation and streamlining of the Department of State [or other agencies]”

I would welcome the views of our witnesses today on these proposals.

Finally, I know that Mr. Kolbe has spent so much of his time in Congress dealing with entitlement programs and that may well confront us with some very difficult choices in the approaching years.

Among other things, we may not have as much in the way of available funds for foreign aid in the future, if other program needs place pressure on our overall budget.

One overarching goal must be to ensure that our foreign aid is neither wasted nor lost through corruption.

All of us know how difficult it is to defend foreign aid when instances of waste or fraud arise.

Therefore, any effort we make to authorize or reform our foreign aid programs must have the assurance that the programs are effective --- and that is what the tax payers want to know.

Any such effort must also seek to implement systems to constantly and objectively evaluate our aid to enable us to ensure that it is furthering U.S. short and long-term interests and priorities.

Perhaps this can be accomplished through an independent agency for evaluation.

Moreover, simply setting goals to increase spending year over year is almost certainly not the way to achieve what we all want – a better world in which we are more secure and those who live in poverty can look forward to a better day.

Funding has to be tied to results and funding should go to those things that work the best.

Thank you, Mr. Chairman.