Nides: Foreign aid funding is a matter of national security

The State Department and USAID are facing their toughest budget season ever as the GOP looks to international affairs accounts for major cuts. But the new Deputy Secretary of State for Management Tom Nides said that the State Department’s argument this year will be that international affairs spending is crucial for America’s national security and therefore can’t be sacrificed.

"Taxpayers want to understand where our money is going. Our view of this is very simple, it is a national security budget," Nides told The Cable in an exclusive interview in his new office on the 7^th floor of State’s Foggy Bottom headquarters. "Our budget should be looked upon no differently than the department of defense’s budget. The DOD budget is a national security budget, the State Department and USAID, likewise."

The Obama administration has long considered State and USAID spending part of the "security" budget, a view that congressional Republicans don’t share. Secretary of State Hillary Clinton has been calling for a unified budget that would combine the Pentagon and State Department budgets into one big account, but that idea has yet to gain traction.  

Some senior lawmakers, such as House Appropriations State and Foreign Ops subcommittee ranking Democrat Nita Lowey (D-NY) and Senate Appropriations State and Foreign Ops subcommittee ranking Republican Lindsey Graham (R-SC), have been arguing that certain parts of the foreign aid budget are certainly crucial to national security, especially the programs in Afghanistan, Iraq, and Pakistan.

Nides argues that all the funding should now be defended on national security grounds — regardless of whether or not they are directly related to countries where the United States has troops on the ground.

"Let’s be clear, the State Department and USAID have a national security mandate. We are helping countries through Feed the Future, Global Health Initiatives, climate change, economic support funding — we’re doing that because we’re building up these countries to be more self reliant and have stronger economies. By doing that, that helps our national security," Nides said.

Already, the Obama administration has subjected the State Department to a disproportional amount of cuts compared to other departments when making budget deals with congressional Republicans. State’s fiscal 2011 budget was cut by $8 billion in the budget deal the administration struck in April to avoid a government shutdown.

Meanwhile, the long-term budget announced in April by House Budget Chairman Paul Ryan (R-WI) would cut the budget for international affairs and foreign assistance by 29 percent in 2012 and 44 percent by 2016 — while increasing the defense budget by 14 percent over the same timeframe.

Administration officials believe their $53 billion fiscal 2012 budget request reflects their first ever Quadrennial Diplomacy and Development Reivew (QDDR), an effort modeled after the Pentagon’s QDR, and aligns resources with national security objectives while making tough choices in a difficult fiscal climate.

But there are signs that State is already thinking about giving up some authorities that it struggled to take from the Pentagon as part of the QDDR’s overall drive to put diplomats and civilians back in charge of foreign policy. For example, State gave back control of the Pakistani Counterinsurgency Capability Fund (PCCF) in the 2011 budget deal in order to take that money off of its ledger. Nides said that was a one-time deal and State would take back that program next year.

"Fiscal year 2011 was an extraordinary year. The transfer back of [PCCF] funding for fiscal year 2011 [to the Pentagon] was just for fiscal year 2011 only. We don’t believe it’s an ongoing policy decision," he said.

He also pledged to keep a robust civilian presence in Afghanistan going forward, despite that Clinton recently said that the buildup of civilians there has peaked.

"We’ve got to keep all this in perspective. There are 100,000 military boots on the ground. We had 300 [civilians in Afghanistan], we’re now at approximately 1,140 civilians. It’s not easy to sustain the level of civilians in a voluntary situation of the level of talent that we need. Over time, we will see a leveling off to a more normalized number of diplomats," said Nides.

Of the 1,140 civilians in Afghanistan now, about 500 are from State, 300 are from USAID, and the rest come from various other government agencies.

Overall, State will continue to make the argument that international-affairs spending comprises only 1 percent of the federal budget and helps produce new economies that can become markets for American companies and goods.

But the main focus will be to identify America’s diplomats and development experts and the front line soldiers in the ongoing battle to keep the country safe and secure, especially as instability due to food shortages and economic turbulence increases around the world.

"You have hungry people, which destabilizes your country. You have a destabilized country, all sorts of bad things happen. State and USAID work to prevent that," Nides said. "This is a very important frame and a very important view.