1.     Senate Approves 302(b) Allocations, Cuts the International Affairs Budget

Yesterday the Senate Appropriations Committee adopted the all-important 302(b) appropriation allocations for FY 2011, which in total cut $14 billion from the President’s FY 2011 request. The Senate allocation for the International Affairs Budget is $54 billion, $2.6 billion (4.4%) below the President’s request level and $3.3 billion above current funding (not including pending supplemental funding of about $6.2 billion for the Frontline States and Haiti). The Senate’s funding level marks an improvement from the $4 billion cut that the Senate Budget Committee recommended in April and that was recently adopted by the House Appropriations Committee. The USGLC released a statement acknowledging Chairman Inouye’s efforts to minimize the size of the cut but raising deep concern over the diminished funding.

During the mark-up, Chairman Inouye, a long-time supporter of the International Affairs Budget, referenced the bipartisan letter sent to him from 37 Senators urging full funding for the President’s International Affairs Budget request.  He said: “The nation is asking more from our Department of State as it expands its role in Iraq, Afghanistan and Pakistan. I have reluctantly recommended this reduced funding level in recognition of the need to reduce overall spending. I would inform my colleagues that 37 Members of the Senate, including several members of this committee, on both sides of the aisle, wrote Vice-Chairman Cochran and me urging to fully fund the President’s budget for the Department of State. We will obviously not be able to meet that request at this reduced funding level.”

2.     Appropriations Process Picking Up Speed, Senate Markup of State-Foreign Operations Bill  Next Week

After getting off to a delayed start, the FY11 appropriations process is moving forward quickly in both houses. The House has marked up eight of the 12 appropriations bills while the Senate has marked up three. The Senate Appropriations Committee will likely on The bill may be “polled out” of the Subcommittee earlier in the week.  A full committee mark up in the House of State-Foreign Operations bill is not likely before the August recess.

As previously reported, very few individual appropriations bills are likely to see Floor action in either the House or the Senate before the FY11 budget year begins on October 1.  Rather, Congress will likely pass a Continuing Resolution in September that will keep the government operating at FY 10 levels until after the November mid-term elections. Congress would then return later in November or December for a “lame duck” session, during which time they could pass an omnibus appropriations bill.

3.     House and Senate  Hold Oversight Hearings on Afghanistan

With concerns mounting in Congress about the U.S. strategy in Afghanistan, the Senate Foreign Relations Committee held a hearing on Wednesday to investigate civilian and governance issues in the country.  The sole witness was Richard Holbrooke, the Special Representative for Afghanistan and Pakistan.  During the hearing, both Chairman Kerry and Ranking Member Lugar expressed doubts about the course of the war in Afghanistan and the effectiveness of U.S. aid dollars given rampant corruption.  Senator Kerry noted that the sacrifice of our troops “will be irrelevant if the United States and our partners do not have a serious strategy to establish effective Afghan governance.”  Ranking Member Lugar agreed and remarked on the “lack of clarity” on a definition of success, even as it has narrowed under President Obama.  Holbrooke said he shared the Committee’s concern about rampant corruption in Afghanistan’s government.  He also highlighted next week’s Kabul donors conference, which he and Secretary Clinton will attend.

On Thursday, the House State-Foreign Operations Subcommittee held its first in a series of hearings about Afghan corruption problems and U.S. aid to Afghanistan.  Chairman Lowey is withholding $3.9 billion in aid for Afghanistan from the FY 2011 State-Foreign Operations Appropriations bill due to concerns about rampant corruption in the country.  Witnesses at the hearing included the Special Inspector General for Afghanistan Reconstruction, Major General Arnold Fields (Ret.); the USAID Inspector General, Donald Gambatesa; and GAO’s Director of International Relations and Trade, Charles Johnson.  During the hearing, Subcommittee members expressed their grave concerns about the need for greater accountability for U.S. taxpayer dollars being sent to Afghanistan and called for tough investigations into the problem.  General Fields assured the Subcommittee that these investigations are underway.  At the end of the hearing, Chairman Lowey asked the witnesses to indicate a sign of progress moving forward to address these issues in Afghanistan.  Both General Fields and Mr. Johnson agreed that the civilian surge in Afghanistan is a measure of such progress.  While praising the surge, they also indicated that there is still a need for more American civilians on the ground, particularly from USAID.  The Subcommittee will hold a series of briefings for its Members on this issue next week.