Secondly, I appreciate very much your service and how you have handled yourself, certainly over the past year, but particularly since 9/11, and I want to thank you and thank your entire team. You have always been very helpful, very responsive. There may be some issues we do not agree with completely.

We are going to have a number of questions-I know you have to leave at 12:30-on policy issues. In addition, a lot of the budgetary ones will be raised with Mr. Armitage and Mr. Green and others. But I just wanted to make that personal comment.

Secretary POWELL. Thank you, Mr. Chairman.

Mr. WOLF. The Secretary today will testify regarding the fiscal year 2003 budget request for the operation of the Department and the assessed contribution of the United States to the United Nations and other internal organizations. Perhaps the key feature of this budget request is the second large personnel increase in as many years to improve diplomatic readiness and diplomatic security. The request includes funding for 631 new positions. If enacted, this will represent a historic increase of over 1,500 American employees in just two years. I think we will actually set a record.

This dramatic expansion of the Department has been undertaken at the same time as widespread calls for reform. The Overseas President's Advisory Panel Report, the Carlucci Report, and others made significant reform recommendations that are not necessarily and I stress not necessarily directly linked to additional appropriations or staff. These included right-sizing, regionalizing, overseas presence, strengthening the authority of the ambassador to improve management, improving inter-agency coordination, and reorganizing the budget and foreign buildings functions of the Department.

We will be interested to hear about the progress of these reforms, and the Committee will look to you to be able to reassure us that the large budget increases are in no way a substitute for reform. They should go together, and not just one taking the place of the other.

As we have discussed last year, I think you will find the Committee eager to assist you in bringing about any needed reform and in achieving a more secure, strategically-managed U.S. presence

overseas.

I am pleased to see that your budget request continues the funding stream that Congress and the Administration has established to improve embassy security. I think that is very important. I saw the story with regard to Rome several weeks ago, and Singapore, and for the Committee and I know Mr. Rogers was very supportive during his tenure-I am very supportive of making sure that we have improved embassy security. That is why when any reprogramming comes up we always make sure that this is done not to just move something, but is done to maximize security.

Since the embassy bombings in Africa, the committee has provided over $4.3 billion to improve embassy security, so we will be interested to hear your views on how this effort is proceeding, how is General Williams, who I do not see in the audience today, but how is he doing?

Another area of particular concern this year is funding for public diplomacy activities. There is a critical and immediate need for ac

tion to counter anti-American sentiment abroad that results largely from misinformation, lack of information, and misunderstanding. American people are good, decent, compassionate people. Had it not been for the American people and the American Government, I do not know what would have taken place in Bosnia. In some respects, if there was any problem, it was perhaps that we waited too long. But because of American efforts and the American military, in Sarajevo now the shops are open and people can walk, and that is mainly, as you know, a Muslim community.

We came to the defense of the Muslims in Kosovo, which is 90 percent Albanian Muslim, 10 percent Serbian Orthodox. The United States stood very boldly, and had we not participated, the genocide would have continued under Milosevich. You can look at other places as well, such as Macedonia, which has a 35 percent Albanian Muslim population. I see President Mubarak is in town$47 billion of American taxpayer money has been given to the Egyptian government since the Camp David Peace Accord.

So America is a good place, and we are good people, and for some reason our message is not appropriately given out. I am concerned that this effort has not been sufficient, given the magnitude of the task, and that the budget request may be inadequate to continue and expand these important activities.

I sent a letter to Mitch Daniels-I think we shared it with the Department-asking that in this area of public diplomacy there should be additional funding.

The Committee is going to have a hearing later on, after we finish the normal process, with your Charlotte Beers, and we are going to try to bring in some outside experts, with regard to the Middle East-Muslim, Christian, all denominations-to see how we get the message out of the goodness of the United States.

When I saw the latest survey-I know you saw that poll-the country with the most positive view of the United States seemed to be Lebanon. And even in Lebanon-I was in Lebanon in Aprilit did not seem overly warm with regard to the United States. I told the Lebanese we had 241 Marines killed in the barracks who were there in defense of Lebanese people. So America is a good country, decent, honest, and we have to get that message out.

I am concerned that there is not enough money in the public diplomacy area to tell the message. We have a great product, and that is American democracy, it is freedom, it is liberty. How do we get that out around the world? I also saw how few people in many of those countries believe that Usama Bin Laden was responsible for this activity. There should be no doubt. We should be able to make a clear case that Usama Bin Laden, al-Qaeda, the Taliban were responsible for that activity. We have to let them see more data and more information, put it on a web page, bring people in. I think the more exchange that we have with regard to those countries, by our people going over, the better.

I think we are just going to have to really rethink and maybe do it a little bit differently and maybe spend a little bit more. But this is not a battle that we can lose.

Lastly, the American soldier is doing an outstanding job, our military.

With that, I will just refer to Mr. Serrano.

OPENING REMARKS OF SUBCOMMITTEE RANKING MEMBER SERRANO

Mr. SERRANO. Thank you, Mr. Chairman. It is always a pleasure to welcome Secretary Powell. I take great pride in bragging about the fact that you and I come from the same neighborhood.

Secretary POWELL. Thank you.

Mr. SERRANO. I chose to take on the voters every two years, you chose to take on the world, but it is worthwhile and I tell you that every morning as I leave my apartment on the Grand Concourse in the city and I see the Grand Concourse Walk of Fame, there you are. I am not on the Walk of Fame yet, but you are there, and we are working to try to reach that point.

I know that especially today, Mr. Secretary, you face many complex challenges in terms of our Nation's foreign policy. Be assured, however, that our Nation continues to value your leadership at the Department of State.

I look forward to working with you and Chairman Wolf on this year's State Department budget. I have reviewed the budget for the Department of State and I am in agreement that we should continue to place a priority on improving our worldwide security and readiness, on the hiring of additional personnel and on continuing our investment in updated computer technology. We should explore new initiatives in the area of public diplomacy. We must also continue our active participation in and obligation to the international organizations of which we are members, and, of course, we should continue to support and fund our peacekeeping obligation.

I have told you this in private, and I have said it in public. I think, of the so many wonderful things that this country does, our peacekeeping effort has really shown who we are as a people, as a Nation, and I think that we should continue that and I will support you in any way that I can.

Mr. Secretary, I also want to take a moment to thank you for the personal commitment that you have made and continue to make to having the personnel in our State Department and Foreign Service reflect our diverse society. Outstanding progress has been made and I know will continue under your leadership. I look forward to learning more details about this progress during the course of this hearing.

Now I would like to take a moment to express my concerns about the diplomatic challenges that are part of our relationship with Latin America, an area that you know you and I have spent time talking about. We need to be careful, Mr. Secretary, to avoid military involvement in Colombia. Colombia has had a problem for many years, and those of us who have the opportunity to read both English and Spanish media accounts know that is a very difficult and sad situation that has been going on for a long time. It is also one of the few places where it is very hard at times to find out who the good guys are and who the bad guys are, because on any given day anyone can tell you that the bad guys are on both sides of the

issue.

And so I would just caution-and it is a message I also bring from many of my constituents-caution that our involvement in Colombia could be a long and costly one that may not take us in a direction that we want to go.

In addition, we must never take for granted but rather should continue to devote careful attention to our relationship with countries in this part of the world.

Mr. Secretary, you can be assured that I will provide assistance and support to Chairman Wolf as this year's State Department budget moves through the appropriations process. I firmly believe that the State Department, with its professional, talented, and dedicated personnel, plays an invaluable role in the conduct of our Nation's foreign policy. I will certainly continue to work to make this a successful budgetary year for you.

Let me close by saying that, although you are the Secretary of State, in addition to being the Secretary of State, in my opinion, you play a major role in the Administration. One of the concerns I have which touches on the Justice Department and the FBI and the INS is the issue of civil liberties during this very difficult time. I know this is an issue of great concern to you. And so, again, in our desire to get the bad guys, we have to be careful that we do not hurt the good guys, and I am just concerned that the tension of people, the invasion of privacy could, again, lead us down a road we do not want to go to.

I do not know if this is a compliment to you, but I have always seen you, as many other Americans, as a calming voice at times when storms are brewing. You always seem to have a handle on how to keep things in their proper place, while being one of the great American patriots of our time. And so I ask you to continue that balance that balance that makes you feel secure, that if someone is trying to misbehave in our Government, you somehow look over their shoulder and say, "Can we talk about this for a second?" It is that second that will make the major difference in world peace and the future of this country, and I thank you for being with us today.

Secretary POWELL. Thank you, sir.

Mr. WOLF. Mr. Secretary, your full statement will appear in the record. Proceed as you see appropriate.

OPENING REMARKS OF SECRETARY OF STATE COLIN POWELL

Secretary POWELL. Thank you very much, Mr. Chairman, and I do have a full statement, and I appreciate its inclusion in the record in its entirety.

I thank you for your very warm opening remarks, and Mr. Serrano, as well, for yours. Grand Concourse always brings back the fondest of memories for me, Mr. Serrano.

I want to begin, Mr. Chairman, by thanking the committee for the solid support that it has provided to the Department during the first year of my tenure. I think we have tried to be worthy of that support. We have been aggressive with respect to the reform efforts within the Department. I have taken to heart all of the many reports about the Department that have been made over the years and trying not to have another report but to execute on the items that have been identified for us to execute on-getting the rightsizing of our embassies done, fixing our security problem, fixing our personnel system, getting the right people in the right place at the right time for the right job within the Department, opening up the Department to new ideas, making sure that the American people,

especially young Americans, see the value of service in the State Department, whether they are in the Foreign Service or Civil Service or whatever component. I think we have been pretty successful at that.

General Williams is not here with us right now. He is out checking buildings, I hope. That is what he is supposed to be doing, not sitting in hearings with me, except when you call for him, Mr. Chairman. But he has been doing a great job. He has really shaken up our whole building construction operation.

As you know, we have given him a more direct line of authority into the leadership of the Department, and we have held him accountable, and he, in turn, is holding everybody accountable for using the best management techniques available within the commercial building industries to bring those techniques into the Department. We have reduced the overall cost of our embassies. We have done some very, very smart things with respect to standardization of power plants and things of that nature. I think we are being very good stewards of the money that you have given to us, that Congress has given to us, the American people have given to us for embassy construction.

I can assure you that, as I said to you last year, I am the CEO of the State Department, not just foreign policy advisor, and there is not a day goes by that I do not devote part of my day, along with Deputy Secretary Armitage and Under-Secretary Green and other members of my staff, on the leadership and management issues that face the Department, and we are working away at them one at a time.

With respect to public diplomacy, Mr. Chairman, I could not agree with you more. We have got to do a better job, and I think we are doing a better job and will continue to do so and we will get better under the leadership of Under-Secretary of State Beers, who brings a different kind of experience, new experience, marketing experience to the Department. Sometimes we get a little criticism about that: "What does a marketeer know?" Well, we are selling a product, and the product is a value system that we all believe in, not selling America as a way of imposing ourselves on somebody else, but a value system that believes in individual rights, democracy, freedom as a way into this 21st century world that is before us, that everybody could benefit from being a part of a globalized world where trade barriers are broken down, where our value systems mean more and more to people around the world.

I am as disturbed as you are over some of the surveys we have seen recently where we have not been successful in getting that message out, and we have got a tough job ahead of us. There is the Israeli Palestinian conflict that to some extent contaminates some of those surveys. We have got to work on that. We have our work cut out for us, but I can assure you that we will be dedicated to that task.

I also want to assure you, Mr. Serrano, that I take very much. to heart the issue of having a Department that represents America. I thank you for what you have done with respect to the Serrano Fellows and the other programs you have sponsored. You and I have had a chance to sit and talk about all of this, reaching out