Will Anyone Pay for Uncle Sam’s World Expo Pavilion?

A last-ditch scramble by Trump’s chief diplomat reveals frictions with Congress over how the State Department spends its money.

By Colum Lynch and Robbie Gramer, a diplomacy and national security reporter at Foreign Policy.
Dubai commemorates hosting the 2020 World Expo.
A fireworks show in Dubai to mark the city's preparations for hosting the World Expo in 2020, seen on Oct. 20, 2018. Cedric Ribeiro/Getty Images)

U.S. Secretary of State Mike Pompeo’s latest plan to contest China, Iran, and Russia for world dominance requires $60 million in taxpayer dollars to build a better World Fair pavilion at the 2020 Dubai Expo.

In recent weeks, even as Pompeo has been caught up in the impeachment probe into his boss, President Donald Trump, his office has been flooding Democratic and Republican congressional leaders’ offices with letters and phone calls pleading to lift restrictions on a decades-long prohibition of public funding for the international gatherings.

The initiative would effectively shift the burden of funding the U.S. presence at the international fair from American corporations, which have traditionally borne the costs of promoting their wares at international expos, to American taxpayers. It would also require Congress to take tens of millions of dollars from the State Department’s diplomatic  budget to cover the costs, according to a State Department spokesperson.

Pompeo framed his appeal for greater spending flexibility as part of a broader foreign-policy strategy aimed at competing with China and other big powers on the international stage. He also argued a strong showing at the Dubai Expo would give U.S. cities, including Minneapolis and Houston, a leg up in their bid to host future expos, which could bring in tens of thousands of jobs and generate billions of dollars in revenue.

But the initiative got a chilly reception from some lawmakers, who view it as an unworthy corporate giveaway at a time when the State Department  has struggled to beat back proposals by the White House to gut funding for foreign assistance and core diplomacy. They also faulted the administration for failing to include a request for expo funding in the president’s budget.

“If Secretary Pompeo believed this pavilion was essential, he should have prioritized raising private dollars to do so—just as other administrations have done,” Evan Hollander, the spokesman for the Democrat-led House Appropriations Committee, told Foreign Policy

Pompeo’s request comes as lawmakers are seeking to impose greater constraints on the administration’s ability to spend money it gets from Congress, and to counter what they see as an effort to thwart Congress’s constitutional role in approving the nation’s budget.

The White House budget office has repeatedly raised the specter of  gutting funding for the State Department and slashing billions of dollars in foreign assistance using a maneuver called a rescission, which involves withholding funds from programs it dislikes until the fiscal budget clock runs out. But the White House ultimately backed down in the face of intense bipartisan opposition in Congress.

In April, the White House imposed a freeze on $450 million in U.S. foreign assistance to three Central American countries—Guatemala, Honduras, and El Salvador—to pressure them to agree to do more to prevent immigrants from traveling to the United States.

Pompeo said that State’s efforts to gain private funding for the expo failed, as not enough businesses have agreed to foot enough of the collective bill to build up the U.S. pavilion. “Unfortunately, U.S. participation in Expo 2020 is in jeopardy, because the private-sector funding model has not succeeded,” Pompeo wrote in an Oct. 15 letter to James Risch, the Republican chairman of the Senate Foreign Relations Committee, obtained by Foreign Policy. “Failing to participate will cede the ground to Iran, Russia and China,” he wrote, adding that China is expected to spend more than $100 million in government funding at the expo. He sent similar letters to Senate Majority Leader Mitch McConnell, Speaker of the House Nancy Pelosi, and other senior Republican and Democratic lawmakers in the Senate and House, as Politico Pro reported on Dec. 9.

Pompeo also sought to link this funding crunch to recent efforts by lawmakers to restrict his freedom to reprogram programs funded by Congress to cover the costs of initiatives favored by the White House. 

In a letter to another senior lawmaker, Pompeo protested that a set of new congressional mandates constrain the State Department’s spending authority, and “inhibit” its ability to check “the expanding influence of China and other malign influences in developing countries around the globe.” 

The expos, informally dubbed the “soft power Olympics” by their advocates, are monthslong events in different cities around the globe where countries pour millions of dollars into creating glitzy pavilions to showcase their business, economies, and cultures. But funding U.S. participation in World Fairs, also known as World Expos, has been a challenge for American officials since the 1990s, when congressional Republicans championed a measure prohibiting the use of U.S. funds for international expositions. The Trump administration initially reiterated support for the prohibition. Congressional Republicans continued to oppose U.S. funding for World Expos during the Obama administration, when Pompeo was a member of Congress.  

In the run-up to the 2015 Milan Expo, then-U.S. Secretary of State John Kerry created a nonprofit entity, the Friends of the U.S. Pavilion, to raise funds for the U.S. delegation, according to Quartz. The nonprofit “failed to meet their target by $20 million, but still spent $62 million on the Expo, and ended up broke,” as Quartz reported last year. It left the State Department saddled with unpaid debt.

Congressional restrictions forced State to make a bold request for the 2020 expo: asking private architecture firms to design and build a U.S. pavilion at the Expo for free, “as a gift to the United States Government.”

“Cost for a representative USA Pavilion for Expo 2020 Dubai is estimated at 50-60 million USD and will be the sole responsibility of the selected organization,” the State Department’s public diplomacy office wrote in its request for proposals last year.

But the calls for private funding fell short.

“The State Department was determined to exhaust all efforts within the authority provided to it by Congress,” a State Department spokesperson wrote to Foreign Policy in an email response. “The Department worked extensively to raise private sector funds through 2018 and early 2019. Unfortunately, this model proved to once again fall short – as it has in 7 of the last 10 Expos.”

The Dubai Expo is one of two priorities that are “vital to the conduct of effective foreign policy,” Pompeo wrote in his letter to another senior lawmaker. The other, he added, is Congress giving the State Department greater flexibility to spend its money in the face of “evolving national security concerns.”

He warned that U.S. participation in the expo is “in jeopardy,” because it’s the only country where the private sector, not the government, has to bankroll participation in the expo.

Pompeo has gained an ally in Democratic Rep. Dean Phillips, whose district is in the Minneapolis area. Minneapolis hopes to host the 2027 Expo. Phillips authorized a bill supporting shared U.S. and private business funding for the Dubai Expo. Some who support Phillips believe the expo could be a boon for U.S. companies looking to expand their business and an important platform for U.S. public diplomacy abroad.

“Millions of people will go through [the Dubai Expo], including heads of state and foreign ministers,” said Mark Ritchie, former Minnesota secretary of state and head of Global Minnesota, a Minneapolis-based nonprofit. Ritchie said a strong showing at the Dubai Expo gives Minneapolis a leg up in a competition among cities around the world to host the 2027 World Expo. Hosting the expo could generate $2 billion in total economic impact, according to projections from the state’s application to host the expo that it submitted to the U.S. Department of Commerce.

“Having a major U.S. public opportunity handed on a silver platter in Dubai … it would be disastrous to miss that opportunity,” said Ritchie.

Democratic and Republican administrations have long had flexibility to reprogram funds to respond to changing policy demands, including one budgetary provision, known as a deviation, that allows the administration to cut up to 10 percent from an appropriated program without notifying Congress. The Senate is now weighing a bill that would eliminate that provision, though the administration would still retain some flexibility to shift money around.  

“Democrats and Republicans agree that we have to protect Congress’s power of the purse,” said one Senate aide. “It flouts the intent of Congress when we appropriate funds for a specific purpose and the White House tries to use it for something else, or just not spend it.”

“Congress has traditionally given them flexibility to deviate, to reprogram funds, because we know the world is not a static place—things change, and there are unforeseen crises,” the Senate aide said. “But if they abuse that authority in ways that clearly undermines the working understanding [between the administration and Congress], if they just run roughshod over Congress and ignore our intent, then the system can’t work.”

Some lawmakers view Pompeo’s appeal as consistent with the administration’s effort to undermine Congress’ intent. The administration never included the request for Expo funding in the president’s budget, meaning Congress would have to take the money from another program to pay for it.

“This has it completely backwards,” Hollander, the Appropriations Committee spokesman, said. “The power of the purse rests with Congress, not the Secretary of State. The Trump administration, including Secretary Pompeo, has trampled on longstanding norms requiring respect for Congressional intent.”

Hollander said that while Democratic Rep. Nita Lowey, the chairwoman of the House Appropriations Committee “supports the efforts of American communities to bid for the World Expo in future years, the Trump administration has completely mishandled the process of preparing for an American pavilion at next year’s event.” She “opposes the State Department’s last minute request to redirect funding from national security priorities to a pavilion in Dubai.”

Pompeo, in turn, expressed concern that Congress was straitjacketing State’s flexibility on where and when to spend its money as it scrambles to counter China’s growing diplomatic clout around the world in his letter to another senior lawmaker.

“As we see the expanding influence of China and other malign influences in developing countries around the world, the extensive and overlapping earmarks and directives in the appropriations bill inhibit the Department’s ability to be nimble and strategic,” Pompeo wrote.

Colum Lynch is a senior staff writer at Foreign Policy. Twitter: @columlynch

Robbie Gramer is a diplomacy and national security reporter at Foreign Policy. Twitter: @RobbieGramer