Jack Lew was confirmed by the Senate last night as the OMB Director after his nomination was held up by Senator Mary Landrieu for several months over off-shore drilling issues.  This is Lew’s second round at OMB, as he ran the shop during the Clinton Administration.  He was very supportive of the International Affairs Budget during his time at State, and we look forward to continuing to work with him.  Thomas Nides, who was nominated as Lew’s replacement at State, sailed through his confirmation hearing on Wednesday, and it is expected the Senate will approve his nomination and have him at Foggy Bottom as Deputy Secretary of State for Management and Resources soon.  He reiterated the President and Secretary’s commitment to a smart power foreign policy in his opening statement, saying “At the heart of their vision is a commitment to elevate diplomacy and development alongside defense as pillars of our foreign policy.”

Must Reads
Who’s In the News
Europe and America, Aligned for the Future (Barack Obama – New York Times)
As an alliance of democratic nations, NATO ensures our collective defense and helps strengthen young democracies. Europe and the United States are working together to prevent the spread of nuclear weapons, promote peace in the Middle East and confront climate change. And as we have seen in the recent security alert in Europe and the thwarted plot to detonate explosives on trans-Atlantic cargo flights, we cooperate closely every day to prevent terrorist attacks and keep our citizens safe. Put simply, we are each other’s closest partners. Neither Europe nor the United States can confront the challenges of our time without the other. These summits are thus an opportunity to deepen our cooperation even further and to ensure that NATO — the most successful alliance in human history — remains as relevant in this century as it was in the last. That is why we have a comprehensive agenda at Lisbon.

Smart Power
U.S. considering combining military, international affairs budgets (Kevin Baron – Stars and Stripes)
The Obama administration is considering creating a unified national security budget that would combine elements of the State Department and U.S. Agency for International Development with the Pentagon, according to a draft copy of a long-awaited foreign policy strategy review shared with Congress this week. Citing the joint planning required between U.S. military and civilian agencies in Iraq and Afghanistan, the proposal is one of several that would put the U.S. diplomatic corps and its lead global humanitarian agency on a stronger national security footing, according to a draft of the State Department’s first-ever Quadrennial Diplomacy and Development Review, or QDDR. Secretary of State Hillary Clinton ordered the review last year to be modeled after the Pentagon’s four-year review, intended as a strategic guide for appropriators. It is part of an ongoing White House-led effort to link development and national security.

Politics/Foreign Policy
Foreign policy setbacks deepen Obama’s wounds (Scott Wilson – Washington Post)
President Obama is halfway through his term and politically weaker after midterm voters punished his party. But ahead are a host of unresolved foreign policy issues, from drawing down troops in Afghanistan to advancing Middle East peace prospects and economic relations with China, that will require a firm base of domestic support and could help determine whether he is reelected. Obama left Thursday for a NATO summit in Lisbon, where he hopes to secure military and financial commitments through 2014 from his allies in the Afghanistan war. But shadowing the meeting is Obama’s early pledge to take on the world’s most vexing issues and the lack of lasting progress achieving those goals. Although he found some adoring audiences in Asia, especially in his childhood home of Indonesia, Obama also encountered foreign leaders skeptical of his free-trade ambitions, proposals to address China’s undervalued currency and U.S. monetary policies designed to promote growth at home.

The Realist Prism: Hard Realities, Hard Choices for Obama (Nikolas Gvosdev – World Politics Review)
It is very likely that come the end of November, after a busy month traveling to Asia and Europe, President Barack Obama will have emerged with few decisive victories to burnish his image after the “shellacking” he took in the midterm elections. Instead, Obama and his team will have to adjust to some hard realities. Though the new Congress will not be seated until January 2011, we are already seeing changes in the political climate in Washington that will test the administration’s ability to show, both to Americans and to other governments, that the executive branch is still in the driver’s seat when it comes to setting U.S. foreign-policy priorities. Josh Rogin quotes an anonymous Republican Capitol Hill staffer as declaring, “You are going to see more aggressiveness to push an agenda and not to defer to the administration.” Even in areas where we can expect some agreement between congressional Republicans and the White House, such as passing the free trade agreement for Colombia, the GOP will do everything in its power to prevent Obama from claiming any sort of success for his administration.

Obama Launches Blitz to Ratify Treaty (Jonathan Weisman – Wall Street Journal)
President Barack Obama launched a bipartisan blitz on Thursday to make the case that Senate ratification of his nuclear arms-control treaty with Russia this year is a national-security imperative. At a White House meeting, Mr. Obama enlisted Republican icons such as Henry Kissinger and James Baker in the effort, along with a platoon of military leaders, as hopes faded for quick approval of the New Strategic Arms Reduction Treaty. Mr. Obama and Vice President Joe Biden raised the stakes on ratification this year, saying a delay until the next Congress was unacceptable. “This is not so much about weakening Obama anymore, but about a weakening of the United States,” a European diplomat said. “Europe will say the United States is no longer ready to shape international law.”