Administration officials announced Monday that the Office of Management and Budget (OMB) will release the FY13 budget request on Monday, February 13, one week later than the February 6th deadline.  The one week delay is needed to finalize some aspects of the budget.  Congressional Republicans, including House Budget Committee Chairman Paul Ryan (R-WI), quickly criticized President Obama for “missing another budget deadline.”  USGLC will provide a comprehensive analysis of the President’s FY13 request the afternoon of February 13^th.

2.    Revised FY13 Spending Caps

As a result of the Super Committee’s failure to agree on a plan for $1.2 trillion in spending reductions late last year, a little known provision in August’s Budget Control Act triggered an adjustment last week to the discretionary spending caps for FY13 and beyond.  While the top line discretionary level for FY13, $1.047 trillion, which is $4 trillion above FY12 levels, does not change, the configuration of the caps was adjusted.

Had the deficit reduction committee produced a plan, discretionary spending caps for FY13 would have remained separated into two buckets — security programs (Defense, International Affairs, Homeland Security, Veterans, and Intelligence) and non-security programs.  Under the revised caps, FY13 discretionary spending is separated into two slightly different buckets — Defense and non-Defense programs.  This means that starting in FY13, the International Affairs Budget, along with Homeland and Security, Veterans, and Intelligence, will reside under the “non-Defense” caps along with all other domestic programs.

Neither OMB nor the Congressional Budget Office (CBO) have released official figures that enable precise calculations of how the FY13 funding caps under the new designations compare to enacted FY12 levels.  CBO is expected to publish these numbers next week.  Based on very tentative estimates, however, it appears that the $501 billion FY13 non-Defense cap (of which the International Affairs Budget is part) is about 2.4% above FY12, whereas the new $546 billion Defense cap is roughly 1.4% below FY12.

3.    Trade Reorganization Proposal Impacts International Affairs Agencies

On January 13, President Obama announced plans to reorganize and consolidate the federal government’s trade-related agencies through a series of streamlining proposals, including several funded by the International Affairs Budget.  If granted the authority to do so by Congress, the proposal would consolidate six business and trade-related agencies into a reconfigured Commerce Department.  The agencies affected include the Small Business Administration, the Office of the U.S. Trade Representative (USTR), and the three that are currently funded by the International Affairs Budget — the Export-Import Bank (Ex-Im Bank), the Overseas Private Investment Corporation (OPIC), and the U.S. Trade and Development Agency (USTDA).

The proposal faces considerable opposition on Capitol Hill and within the business community.  Senate Finance Chairman Max Baucus (D-MT) and House Ways and Means Chairman Dave Camp (R-MI) released a joint statement opposing the plan’s inclusion of USTR, over which their committee has jurisdiction.  Representative Sandy Levin (D-MI), the Ranking Member of the House Ways and Means Committee, said Congress should consider the President’s proposal but noted the importance of an independent, stand-alone USTR.  In addition, 86 businesses released a letter to the President expressing deep concerns about the proposal timed to coincide with his State of the Union.

Administration officials have been briefing congressional staff this week on the reorganization proposal.  It is expected that the proposal to the Hill will come in two stages.  The first will be a measure to reauthorize an authority in effect until 1984 that gave the President fast-track authority to reorganize government agencies.  It allows expedited treatment of Presidential proposals to reorganize with an up or down vote by Congress.  The second submission, which would not come until Congress approves the “fast track” authority, would contain the details of the reconfiguration of trade-related agencies in a revamped Commerce Department.

Implications for International Affairs Programs

Making the Federal Government more efficient and streamlining agency operations is vital at a time of intense budget pressure.  At the same time, any merger of assorted agencies and offices needs to make sense in terms of integrating units with similar mission to ensure that well-functioning, high-performing agencies are not consolidated in a way that will undermine their success and hinder their ability to achieve goals.

The proposed reorganization raises several issues beyond the USTR issue that we will be monitoring:

• Shift of mission: Two International Affairs agencies that would be consolidated under the Commerce Department reconfiguration – OPIC and USTDA – have their missions firmly in promoting economic development in developing countries and emerging markets.  Both agencies are frequently central to America’s response to global opportunities and challenges, such as the fall of the Berlin wall in 1989 and more recently the political upheaval in Arab world.

• Risks losing flexibility: A comparative advantage of OPIC and USTDA is that they are small agencies, with a staff of 250 and 50, respectively.  As such, they are agile and can respond quickly to unanticipated global events.  Subsuming them into a large bureaucracy with layers of restrictions and regulations could hinder this degree of flexibility and minimize their utility in contributing to emerging foreign policy contingencies.

• Shifts funds away from International Affairs Budget: OPIC and the Ex-Im Bank are part of the International Affairs Budget and funded within the State-Foreign Operations appropriations bill.  Under the Administration’s proposal, resources for these agencies would likely move to a different appropriations bill.  Ex-Im and OPIC are self-financing institutions, expected to return more than $450 million to the U.S. Treasury this year.  As a result, the State-Foreign Operations account would no longer receive nearly half a billion dollars annually in OPIC and Ex-Im revenues, which is used to fund other programs in the State-Foreign Operations bill.

When considering any reform, reorganization or realignment of International Affairs Budget tools or program, it will be important to consider the foreign policy and development implications, along with the trade questions:

• Does the proposal add value to the overall functioning of American foreign policy and what are the implications for America’s economic development goals?
• Will it negatively affect any of the functions that are currently operating well?
• How does it address a documented problem or does it merely move structures around in an effort to create change?

4.    State Department Announces Changes to F Bureau

Last Friday, the State Department announced that the Office of the Director of Foreign Assistance, the bureau that manages foreign assistance (known as the F Bureau), has been renamed the Office of U.S. Foreign Assistance Resources.  This announcement essentially makes official how the bureau has been operating for the last year and a half.

This office will be headed by a director who will report to the Deputy Secretary for Management and Budget.  Rob Goldberg, previously Deputy Director of the F Bureau, now serves as the Director of the Office of Foreign Assistance Resources.  While the State Department remains the lead agency for overall State and USAID budget development and coordination, USAID retains its budget and policy capacity within the broader foreign assistance process.  This framework builds on USAID’s initiatives to reform its own policies and procedures, including a new monitoring and evaluation policy, initial steps toward procurement reform and a program cycle for next year that will be based on Country Development Cooperation Strategies.  Among other responsibilities, the office will:

• Work with the Bureau of Resource Management and USAID to implement multiyear strategic planning and budgeting, a direction from the Quadrennial Diplomacy and Development Review (QDDR);
• Develop best practices for effective management of foreign assistance funding;
• Oversee operational planning, performance management and accountability of foreign assistance funds; and
• Exercise the authority delegated by the Secretary to provide for continuous supervision and general direction of foreign assistance and approving the programming of foreign assistance as necessary to ensure a coordinated U.S. foreign assistance strategy.

With the latest Continuing Resolution (CR) expiring at midnight tomorrow, and Members eager to adjourn for the year, Congressional leaders and the White House are trying to wrap up the FY12 appropriations process and resolve several other important matters including an extension of the payroll tax cut and unemployment benefits. What was expected to be rather swift passage this week of the FY12 omnibus appropriations bill has now become mired in high-level brinksmanship over competing partisan measures related to the payroll tax cut extension and other non-appropriations related issues.

Earlier this morning House leaders unveiled the omnibus bill of the remaining nine FY12 appropriations bills (H.R. 3671), including the State-Foreign Operations bill.  At the same time, House leaders announced their intention to move the omnibus bill along with two other measures: a disaster relief bill (H.R. 3672) to provide emergency domestic assistance, and a resolution (H. Con. Res. 94) providing offsets to the disaster relief through an across-the-board 1.8% cut to all non-defense discretionary spending.  The filed omnibus is not yet official because Democratic conferees have yet to sign it.  When and how an agreement with the White House and Congressional Democrats will be reached on these measures is very much in question, with passage of another short-term CR into next week a possibility.

The funding level in the omnibus for the FY12 State-Foreign Operations Appropriations bill presents a mixed picture for the International Affairs Budget.  The omnibus measure provides $42.1 billion in base funding for State-Foreign Operations, roughly splitting the difference between the base levels proposed by the House and Senate earlier this year.  This level represents a 5% decrease from FY11 and 14% from FY10.  However, the measure also provides $11.2 billion in the Overseas Contingency Operations (OCO) account for war-related programs in the Frontline States – $2.5 billion above the President’s request.  This additional OCO funding, which includes security-related programs in the Frontline States and other regions that originally had been funded under the base budget, results in a total “base” funding closer to FY11 enacted levels.  While in the short-term this is a favorable outcome given the far deeper cuts proposed by the House, the long-term implications of continued decreases in non-OCO funding levels are very concerning.

2.    Senate Republicans Speak Out on Importance of International Affairs Budget

Speaking this Tuesday at the Foreign Policy Initiative 2011 Forum, Senators Kelly Ayotte (R-NH), Lindsey Graham (R-SC), John McCain (R-AZ) and Marco Rubio (R-FL) championed strong U.S. global engagement and the vital role of the International Affairs Budget.  Senator Rubio stressed the importance of U.S. foreign assistance to all facets of Americans’ daily lives, saying: “In essence, what happens halfway around the world directly impacts virtually every aspect of our life, including how much you pay at the grocery store, how much the toys you buy this Christmas are going to cost, how much food prices are going to be…  And beyond that, the future definition of what the world is going to be like.  I think America’s indispensible to that.”  In an interview with The Washington Post after the forum, Senator Ayotte criticized efforts to cut the International Affairs Budget, noting it provides an excellent return on investment and that “[i]t’s less than one percent of the total budget.”  Senator Graham also took to task those who have called for cutting foreign assistance, saying, “Yes, talk about foreign aid as something that needs to be reformed but, for God’s sakes, don’t give the illusion to Americans that we can be safe by disengaging.”

3.    Senate Defeats Balanced-Budget Amendments

Yesterday the Senate rejected two versions of a balanced-budget amendment to the Constitution after several hours of debate.  Neither of the competing bills received the two-thirds majority (67 votes) required for passage.  S.J. Res. 10, sponsored by Senator Orrin Hatch (R-UT) and rejected 47-53, would require that outlays not exceed revenues unless a two-thirds majority in Congress voted to allow a budget deficit. The bill also caps federal spending at 18% of GDP and would require a two-thirds majority to approve any tax increase.  S.J. Res. 24, sponsored by Senator Mark Udall (D-CO) and rejected 21-79, would also mandate that outlays not exceed revenues, but would require only a three-fifths majority to allow deficit spending.

Under the terms of the August debt ceiling deal, both chambers were required to hold a vote on a balanced-budget amendment before the end of the year.  The House version taken up last month failed by a vote of 261-165.

4.    House Budget Committee Introduces Budget Reform Measures

House Budget Committee Chairman Paul Ryan (R-WI), along with several other Republicans on the committee, recently introduced a package of ten budget reform bills aimed at enforcing tougher spending controls, enhancing oversight, and improving transparency of the federal budgeting process. In a statement, Chairman Ryan said, “Washington stumbles from budget crisis to budget crisis, with little to no oversight of how government spends hardworking taxpayers’ money… These reforms mark an important first step to getting our arms around the problem, but there is no substitute for political will in solving our structural budget problems.” The various proposals include:

• Creating a biennial budgeting cycle;
• Giving the joint budget resolution the force of law by requiring enactment by the President;
• Establishing binding limitations on federal spending and deficits with automatic spending cuts for programs that grow faster than inflation;
• Funding the government though automatic continuing resolutions, with an across-the-board 1% cut for every 90 days past the start of the fiscal year that Congress fails to enact appropriations bills; and
• Capping total government spending at 20% of GDP.

The House is expected to take up the bills early next year, but the previously introduced line-item veto bill (H.R. 3521), sponsored by Chairman Ryan and Ranking Member Chris Van Hollen (D-MD), was approved Thursday by the Budget Committee in a vote of 23-13.  The bill, with twelve bipartisan co-sponsors, grants the president the authority to withhold the obligation of any amount of discretionary budget authority for 45 days, giving Congress time to debate and vote on the proposed cuts in an up-or-down vote.  It is structured to avoid the constitutional obstacles that led to the Supreme Court overturning the previous line-item veto bill enacted in 1996.

With the Senate’s decision earlier this week to forego action on the FY12 State-Foreign Operations Appropriations bill (S. 1601), as part of a second minibus appropriations measure, action now shifts to conference negotiations between House and Senate appropriators to reconcile the two chambers’ bills. The task will be considerable given the $5 billion difference in the bills’ overall allocations, wide variations in funding levels for specific accounts, and several contentious policy-related provisions.

Earlier this week, Defense Secretary Leon Panetta and Joint Chiefs Chairman Martin Dempsey weighed in with House and Senate Appropriations leaders on the importance of robust funding for development and diplomacy programs.  In a letter to Senate Appropriations Committee Chairman Daniel Inouye (D-HI), House Appropriations Committee Chairman Hal Rogers (R-KY), and State-Foreign Operations Appropriations Subcommittee Chairs Patrick Leahy (D-VT) and Kay Granger (R-TX), Secretary Panetta and General Dempsey wrote “[t]he return on investment from robust diplomatic efforts and targeted development programs is the protection of both the lives of our people not sent into harm’s way and our Nation’s fiscal health as we prevent problems from leading to armed conflict.”

The House and Senate are expected by tomorrow to approve a second Continuing Resolution (CR), as part of the final FY12 Agriculture, Commerce-Justice-Science, and Transportation-HUD minibus.  This will give negotiators until December 16 to finalize the nine remaining appropriations bills, including the State-Foreign Operations bill.  Speculation is that this will take the form of one omnibus appropriations measure, although it will meet strong resistance from some House Republicans.  If Congress cannot wrap up work on a final FY12 omnibus before the Christmas recess, they will have to pass a third CR into the New Year.

2.    Super Committee Deadline Fast Approaching

With the November 23 deadline for the Super Committee to propose a plan for reducing the deficit by at least $1.2 trillion less than a week away, lawmakers on the Committee are scrambling to try and forge a compromise amid increasing partisan posturing from both sides over which party will be to blame if the Committee is unable to reach an agreement.  The main sticking points remain over revenue increases and entitlement reform.  The Committee may hold a public session next week to debate the competing proposals that have been offered by Republicans and Democrats on the committee and vote on those proposals.

If the Committee is able to reach a deal it almost certainly will include across-the-board cuts to discretionary programs, imposing additional cuts to those already being shouldered by the International Affairs Budget.  If the Committee is unable to reach a deal, or if Congress is unable to pass an agreement reached by the Committee, the International Affairs Budget will be susceptible to the automatic spending cuts set to begin in FY13.

3.    House Taking Up Balanced-Budget Amendment

Today the House will take up consideration of a balanced-budget amendment to the Constitution (H. J. Res. 2), with a vote scheduled for tomorrow.  The bill would require that federal spending not exceed revenues, unless three-fifths of both the House and Senate voted to allow deficit spending.  It would also require a three-fifths majority in order to raise the debt ceiling, but only a simple majority to raise taxes.  This measure is a more moderate version of other balanced-budget amendment proposals, including one favored by conservatives that imposes spending caps and limits spending levels to 18% of GDP.

The vote on the measure, which requires a two-thirds majority (290 votes) for passage, is expected to be close.  Under the terms of the August debt ceiling deal, both chambers are required to hold a vote on a balanced-budget amendment before the end of the year, but the Senate has yet to take action.  The House passed a nearly identical balanced-budget amendment in 1995 by a vote of 300-132, but the measure failed in the Senate.

Several factors are contributing to the impasse and shift in the Senate floor schedule, including objections to the unanimous consent agreement to proceed to debate on the bill from Senators Bob Menendez (D-NJ), Bill Nelson (D-FL) and Marco Rubio (R-FL), who oppose a provision in the Financial Services bill related to Cuba, and objections from some Republicans, including David Vitter (R-LA), to abortion-related provisions in the State-Foreign Operations bill.  The likelihood of dozens of controversial and time-consuming amendments being offered to the State-Foreign Operations and Financial Services portions of the measure and other competing legislative priorities before the Thanksgiving recess also are factors.

For the remainder of the week, it appears the Senate will continue consideration of the Energy & Water Appropriations bill as a stand-alone bill, the Defense Authorization bill, and the conference report on the first minibus package that also includes a second Continuing Resolution lasting until mid-December. (See the item below for the final FY12 spending levels on international food aid).

Yesterday, voices urging Senators to oppose further cuts to America’s development and diplomacy programs got a powerful boost in a letter from five former Secretaries of State.  In the letter to Members of Congress, Condoleezza Rice, Colin Powell, Madeleine Albright, George Shultz and Henry Kissinger raise their concerns about cuts to the International Affairs Budget, warning that “now is not the time for America to retreat from the world.”

Final FY12 Levels Approved for International Food Aid

The final agreement on FY12 spending levels for the Agriculture, Commerce-Justice-Science, and Transportation-HUD Appropriations bills, which comprised the first minibus package, was reached over the weekend.  The House last night filed the conference report for the measure, which provides a total of $1.65 billion for international food aid programs – $1.466 billion for Food for Peace/P.L. 480 and $184 million for McGovern-Dole Food for Education – representing a 3% cut from FY11 levels but a significant improvement over the 28% cut approved by the House this summer.

As has been reported, the International Affairs Budget is very vulnerable with a number of cutting amendments expected to be offered during the Senate debate.  Actual amendments will not be available until they are filed next week.  However, cutting amendments that are likely to be filed include those on the United Nations, State and USAID Operating Expenses, Pakistan, climate change, the U.S. Institute for Peace, East-West Center, and cutting off assistance to nations such as China and Russia that hold more than $10 billion in U.S. debt.

How the Amendment Process Will Work

The amendment process for this minibus will depend on the unanimous consent (UC) agreements (the terms for consideration of the bill and its amendments) and time agreements (limits on time available for debate and who will control that time) reached by the leadership and the floor managers.

Here are a few items to keep in mind:

1. Timing of Amendments. Though there are three separate appropriations bills (Energy-Water, Financial Services, and State-Foreign Operations) rolled into the minibus, amendments to any of the three bills can be filed, debated and voted on at any time.  Therefore, even though the State-Foreign Operations bill is third and last in the minibus bill text, votes to the State-Foreign Operations bill could occur at anytime throughout the duration of debate on the minibus.
2. Voting Threshold. It is expected that agreements will be reached requiring 60-vote thresholds for some of the amendments to the State-Foreign Operations bill.  More than half of the votes on amendments to the first minibus required 60-vote thresholds.
3. Firewall. During debate of the first minibus, so-called “firewalls,” were established, which prohibited consideration of amendments that would have transferred money between appropriations bills.  For example, the Senate was prohibited from considering an amendment that would have cut funding from the Agriculture bill and transferred the savings to the Transportation bill.  It is expected similar firewalls will be established for the second minibus, but all will depend on the UC agreements ultimately reached.

Senate action on the second minibus is possible the week of November 14, but other competing legislative priorities could take precedence.  For example, indications are that the Senate may take up the FY12 National Defense Authorization Bill the week of November 14, which will require considerable floor time.  In addition, with the deadline for the current Continuing Resolution (CR) expiring on November 18, Congress will need to pass another CR to keep the government running until agreements can be reached on FY12.

The vehicle for the next CR will likely be the conference report on the first minibus package the Senate passed on November 2, which is currently in conference negotiations with the House.  It is expected that the next CR would last until mid-December.

Senate floor action on the next FY12 minibus appropriations package, consisting of the State-Foreign Operations (S. 1601), Financial Services, and Energy-Water appropriations bills will likely begin next week, instead of this week as was earlier reported.  While the floor calendar still remains in flux and some initial debate on the minibus could occur later this week, Democrat and Republican leadership staff indicate that the bulk of the debate will take place next week.

The text of this next three-bill minibus was unveiled last night, following passage earlier in the day of the Agriculture, Commerce-Justice-Science, and Transportation-HUD appropriations minibus.  That measure passed by a 69-30 vote, with 16 Republicans voting in favor of the measure.

As previously reported, the International Affairs Budget is very vulnerable to cutting amendments during Senate floor consideration.

With the clock rapidly ticking toward the November 18 expiration of the FY12 Continuing Resolution (CR) – and acknowledgement now from Appropriations leaders that another CR until mid-late December will be necessary – the Senate is preparing to take up another “minibus” appropriations package next week that could include the State-Foreign Operations Appropriations bill (S. 1601).  This package is tentatively scheduled to hit the floor on Wednesday following a vote earlier in the week on the first appropriations minibus (comprised of the Agriculture, Commerce-Justice-Science, and Transportation-HUD Appropriations bills).  While it has yet to be finalized what bills will be in the second minibus, possibilities include State-Foreign Operations with the Financial Services and Energy-Water Appropriations bills or State-Foreign Operations with the Defense and Homeland Security Appropriations bills.

Given the current political and fiscal climate, the International Affairs Budget would be very vulnerable to additional cuts during Senate floor consideration.  The Senate’s $44.64 billion State-Foreign Operations allocation for non-war related “core” programs is a significant $5 billion improvement over the $39.6 billion provided by the House.  Therefore, any cuts adopted by the Senate could be damaging in final FY12 negotiations with the House.

2.    White House Warns Appropriators Against Disproportionate Cuts to the International Affairs Budget

Last week the Obama administration weighed in on the FY12 appropriations bills, outlining the White House’s priorities for the final bills.  Office of Management and Budget Director Jack Lew sent a letter to House and Senate Appropriations leaders making it clear that President Obama will veto any appropriations measure that “undermines critical domestic priorities or national security through funding levels or language restrictions, contains earmarks, or fails to make tough choices to cut where needed while maintaining what we need to spur long-term job creation and win the future.”

The letter made a strong case for the International Affairs Budget and endorsed the Senate’s higher funding levels.  Lew emphasized the White House’s commitment to the International Affairs Budget, saying: “The President believes that civilian and military power are inextricably linked, and that effective deployment of tools in a coordinated and flexible way is fundamental to meeting the whole of our national security priorities. The budget, therefore, must build military strength and smart civilian security programs, domestically and around the world.”

Lew expressed support for the Senate marks for Defense and State-Foreign Operations and cautioned against deep and disproportionate cuts to the civilian tools of national security, saying, “The [Senate’s] DOD funding level, a freeze, will sustain our strong military, while the difficult but manageable reductions in the Department of State and other international programs leave the resources to sustain critical U.S. engagement around the world. By contrast, an unbalanced approach will not serve America’s national security or its vital interests around the world.”

House Foreign Affairs Committee members Representative Ted Poe (R-TX) and Ranking Member Howard Berman (D-CA) introduced Wednesday the Foreign Aid Transparency and Accountability Act of 2012 (H.R. 3159) along with 29 bipartisan cosponsors.  USGLC released a statement commending Representative Poe and this bipartisan effort “for raising the bar to ensure our nation has accountable, transparent foreign assistance programs across all departments and agencies.”

Building upon transparency and accountability programs already in place at USAID and the State Department, the bill directs the President, in consultation with the State Department, USAID, Millennium Challenge Corporation (MCC), and the Department of Defense, to establish guidelines regarding the establishment of goals, metrics, and monitoring and evaluation plans for all U.S. foreign assistance.  The guidelines must provide direction to all agencies who administer foreign aid on areas such as:

• Building measurable goals, “including the provision of sufficient program resources to conduct monitoring and evaluation;”
• The establishment of annual monitoring and evaluation objectives that reflect policy and programmatic priorities;
• Partnering with the academic community, implementing partners, and other external institutions to ensure the use of best practices in monitoring and evaluation; and
• The development of a knowledge and lessons learned “clearinghouse” accessible by all U.S. development professionals, implementing partners, the aid community, and recipient governments.

The bill also codifies the Foreign Assistance Dashboard and requires all agencies who administer foreign assistance programs to publish online (within two years of enactment of the bill) data on their programs for the previous five fiscal years.

2.    House Foreign Affairs Committee Marks up U.N. “Reform” Bill

The House Foreign Affairs Committee yesterday approved on a party-line vote of 23-15 the United Nations Transparency, Accountability and Reform Act of 2011 (H.R. 2829). The bill, sponsored by Committee Chairwoman Ileana Ros-Lehtinen (R-FL), places several conditions on U.S. contributions to the UN in order to bring about policy reforms in the body.  The legislation would cut U.S. contributions by 50 percent unless the UN moves within two years to voluntary donations from the current system of assessed dues.  Among other provisions, the bill:

• Places a moratorium on new or expanded peacekeeping missions;
• Withholds contributions to the Human Rights Council and prevents the U.S. from holding a seat on the Council;
• Prohibits funding to UN Relief and Works Agency (UNRWA), the UN entity that provides assistance to Palestinian refugees;
• Places restrictions on funding to the International Atomic Energy Agency; and
• Suspends funding to UN bodies that do not sign a “transparency certification” pledging additional cooperation with the U.S. Comptroller General to allow congressional oversight of UN activities.
  

In her opening statement, Representative Ros-Lehtinen (R-FL) stated: “We need a game-changer.  We will never achieve lasting, sweeping reforms if the U.S. keeps paying in full what the UN dictates to us, with no consequences for the UN’s failures. It’s time to leverage our funding to achieve lasting UN reform, by passing this UN Reform bill.” Representatives Dan Burton (R-IN), Ann Marie Buerkle (R-NY), and Jeff Fortenberry (R-NE) also provided statements in support of the bill.

Ranking Member Berman rebutted that “all of us are familiar with flaws and shortcomings of the United Nations… But it is also important to recognize that the UN often plays an essential role in supporting American foreign policy and national security interests.” Representatives Gary Ackerman (D-NY), Russ Carnahan (D-MO) and Ted Deutch (D-FL) spoke in opposition. Representative Carnahan, currently serving as the Democratic Congressional Representative to the UN General Assembly, said that “a policy of engagement is far better than one of disengagement… and this bill is not in our national interest.”

Prior to the markup, Secretary Hillary Clinton sent a letter to the Committee expressing strong opposition to the bill and indicating that she would recommend President Obama veto it.  In the letter Secretary Clinton writes, “As challenges to U.S. national security interests become more global in nature, we must use all the tools at our disposal to advance U.S. values and national security interests.  The United Nations, for all its imperfections, is indispensible to advancing these goals.  This bill would effectively cede American leadership, creating a void for our adversaries to fill.”

During the markup, Ranking Member Berman offered a substitute amendment that called for many of the same policy reforms to improve transparency and accountability in the underlying bill without conditioning contributions to the UN.  In offering the amendment, Berman said, “My amendment will not get the U.S. out of the UN, but it would be a far more effective tool for promoting real reform and countering anti-Israel bias in the UN.”  The amendment, which also would codify the State Department’s UN Transparency and Accountability Initiative (UNTAI) to improve monitoring and evaluation reporting on UN reforms, failed by voice vote.

No date for the bill’s consideration by the full House has been scheduled, although action this year is likely.  The bill will not be considered by the Senate.

3.    FY12 Appropriations Enter Final Negotiations

Two weeks into FY12 and with a little over four weeks remaining before the expiration of the FY12 Continuing Resolution, negotiations over final FY12 appropriations levels are heating up.  House and Senate leaders are working to first reconcile the different top-line spending allocations (302b’s) for each of the 12 appropriations measures.   As previously reported, the Senate’s International Affairs Budget funding level is $6 billion higher than the House level.

Secretary Clinton last week sent a letter to all Members of the House and Senate cautioning against deep and disproportionate cuts to the International Affairs Budget, writing: “With just one percent of the budget, State and USAID make an outsized contribution to America’s security, prosperity, and global leadership.”  She urged Members to support the “reasonable” Senate mark for the State Department and USAID, saying, “Maintaining our leadership takes resolve, and it takes resources.”

Rather than using one catch-all omnibus spending package, House and Senate leaders this week indicated they would prefer to move final appropriations bills in “minibuses” that include a few appropriations bills each.  Thus far the Senate has only approved one appropriations bill while the House has approved six.  The FY12 State-Foreign Operations appropriations bill has gotten as far as subcommittee approval (in July) in the House and Committee approval (in September) in the Senate.

While the Senate is expected to take up the Agriculture, Commerce-Justice-Science, and Transportation-Housing and Urban Development bills next week, action on State-Foreign Operations in not expected in either chamber.

As the FY12 negotiations continue, the Super Committee is continuing its deliberations largely behind closed doors as they work toward the November 23 deadline to report on their recommendations for achieving at least $1.2 trillion in deficit reduction.  This week in the House, all committee Ranking Members sent letters  to the Super Committee focusing on  the impact to programs under their jurisdiction if the Super Committee fails to reach an agreement and automatic cuts under sequestration are triggered. House Foreign Affairs Committee Ranking Member Berman’s letter emphasized the critical economic benefits the International Affairs Budget provides our nation and Appropriations Committee Ranking Member Norm Dicks’ (D-WA) letter focused on the devastating impact cuts to development and diplomacy programs would have on global health and the Food for Peace program, in particular.

Today the House passed by unanimous consent a short-term continuing resolution (CR) for FY12, avoiding a government shutdown when FY12 beings tomorrow at midnight.  The CR, which passed the Senate on Monday and only lasts until Oct. 4, eliminates any FY11 disaster funding, which was the sticking point between the two chambers over offsets to pay for that funding.

On Monday, the Senate also passed a six-week CR providing funding through November 18.  The longer-term CR cuts 1.5 percent across-the-board from FY11 levels to meet the $1.043 trillion discretionary spending cap required by the August budget deal.  It also includes $2.65 billion in FY12 disaster funding with no offsets, a compromise brokered between Senate Majority Leader Reid (D-NV) and Senate Minority Leader McConnell (R-KY).  The House will take up the longer-term CR next Tuesday when lawmakers return from recess. However, passage of the longer-term CR could be opposed by some House Republicans due to the lack of offsets for disaster funding.

FY12 Appropriations Negotiations

With the start of FY12 on Saturday, House and Senate appropriators will be working hard over the next several weeks to reconcile the FY12 spending bills and sign them into law.  The goal is to wrap up FY12 appropriations, potentially in the form of an omnibus appropriations measure, prior to the November 23 deadline for the Super Committee to report on its recommendations for deficit reduction.  It remains uncertain if congressional leaders will be able to meet that timetable.

In terms of the International Affairs Budget, negotiators need to resolve a $5 billion discrepancy between House and Senate levels for the FY12 State-Foreign Operations Appropriations Bill, as well as a roughly $500 million difference between House and Senate levels for international food aid in the FY12 Agriculture Appropriations Bill.  The Senate’s funding level of $44.64 billion for non-war related “base” programs in the State-Foreign Operations Appropriations Bill is a significant improvement from the House’s level of $39.6 billion – which represents a devastating 20 percent cut from FY10 levels, with even deeper cuts to specific areas such as State and USAID operating expenses and multilateral development assistance.  For international food aid in the FY12 Agriculture Appropriations Bill, the Senate provides $1.75 billion while the House provides $1.23 billion.