Statement of Administration Policy: S. 961 - Foreign Aid Reduction Act of 1995

(Senate)
(Helms (R) North Carolina)

S. 961 would seriously undermine the President's prerogatives and authorities to carry out U.S. foreign policy, and deprive the United States of the resources necessary to exercise leadership in addressing the complex challenges of the post-Cold War period. S. 961, like the related House-passed bill (H.R. 1561), is an unacceptable combination of unwise restrictions on Presidential authority, congressional micro-management, and inadequate appropriations authorizations.

Therefore, if S. 961 were presented to the President in its current form, the Secretary of State, the Secretary of Defense, the U.S. Ambassador to the United Nations, and the Administrator of the Agency for International Development, would recommend that the bill be vetoed.

S. 961 imposes extensive restrictions on the President's authority to conduct foreign policy, which will affect the Administration's ability to honor U.S. international commitments and responsibilities. Among the most objectionable provisions are: unworkable restrictions on implementing the North Korea Framework Agreement; restrictions on participation of Private Voluntary Organizations and the private sector in carrying out assistance programs; and restrictions on important assistance programs in Nicaragua, overseas drug control efforts, and credit programs in the New Independent States.

The bill also contains troublesome policy statements that will complicate the U.S. ability to address delicate foreign policy issues (e.g., Taiwan and China). In addition, the Administration objects to section 318, which would impose criminal penalties for persons engaging in any activity intended to "circumvent" a foreign assistance restriction. The vagueness of this provision raises serious constitutional concerns.

S. 961 would also drastically reduce appropriations authorizations for foreign aid and other programs, and it contains a number of earmarks, which further limit the Executive's ability to address changing requirements. The reduced authorization levels and earmarks in S. 961, together with the reduced authorization and personnel levels in S. 908 (the Foreign Relations Revitalization Act) would lead to a deterioration of our Nation's ability to remain engaged on a variety of issues vital to U.S. national interests. The Administration notes that the overall level of funding authorized in S. 961 represents a reduction greater than that required to meet the already low levels set in the Budget Resolution. Even at the funding level for international programs agreed upon in the Budget Resolution Conference, there is room for improvement in many of the programs authorized in S. 961.

S. 961 sharply limits the purposes of foreign assistance, omitting the Administration's key objectives of preventing environmental degradation, promoting family planning, and expanding democracy and human rights.

In addition, the Administration opposes section 718, which would eliminate cargo preference requirements on the transportation of agricultural commodities as part of any U.S. Government- administered food assistance program. This change in current law would weaken the U.S. maritime industry.

The Administration maintains its strong support for the multilateral development institutions, particularly the International Development Association and the International Monetary Fund's Enhanced Structural Adjustment Facility. These institutions are highly effective in promoting market-oriented economic reform in the poorest developing countries, in integrating these countries into the global economy, and in developing important new markets for U.S. business.

Pay-As-You-Go Scoring

S. 961 would affect receipts; therefore, it is subject to the pay-as-you-go requirement of the Omnibus Budget Reconciliation Act (OBRA) of 1990. OMB's preliminary scoring estimates of this bill are presented in the table below. Final scoring of this legislation may differ from these estimates.

PAY-AS-YOU-GO ESTIMATES
($ in millions)