[House Hearing, 106 Congress] [From the U.S. Government Publishing Office] HEARING ON THE BALKANS: WHAT ARE U.S. INTERESTS AND THE GOALS OF U.S. ENGAGEMENT? ======================================================================= HEARING BEFORE THE COMMITTEE ON INTERNATIONAL RELATIONS HOUSE OF REPRESENTATIVES ONE HUNDRED SIXTH CONGRESS FIRST SESSION __________ AUGUST 4, 1999 __________ Serial No. 106-77 __________ Printed for the use of the Committee on International RelationsU.S. GOVERNMENT PRINTING OFFICE 62-629 CC WASHINGTON : 2000 ------------------------------------------------------------------------------ For sale by the U.S. Government Printing Office Superintendent of Documents, Congressional Sales Office, Washington, DC 20402 COMMITTEE ON INTERNATIONAL RELATIONS BENJAMIN A. GILMAN, New York, Chairman WILLIAM F. GOODLING, Pennsylvania SAM GEJDENSON, Connecticut JAMES A. LEACH, Iowa TOM LANTOS, California HENRY J. HYDE, Illinois HOWARD L. BERMAN, California DOUG BEREUTER, Nebraska GARY L. ACKERMAN, New York CHRISTOPHER H. SMITH, New Jersey ENI F.H. FALEOMAVAEGA, American DAN BURTON, Indiana Samoa ELTON GALLEGLY, California MATTHEW G. MARTINEZ, California ILEANA ROS-LEHTINEN, Florida DONALD M. PAYNE, New Jersey CASS BALLENGER, North Carolina ROBERT MENENDEZ, New Jersey DANA ROHRABACHER, California SHERROD BROWN, Ohio DONALD A. MANZULLO, Illinois CYNTHIA A. McKINNEY, Georgia EDWARD R. ROYCE, California ALCEE L. HASTINGS, Florida PETER T. KING, New York PAT DANNER, Missouri STEVE CHABOT, Ohio EARL F. HILLIARD, Alabama MARSHALL ``MARK'' SANFORD, South BRAD SHERMAN, California Carolina ROBERT WEXLER, Florida MATT SALMON, Arizona STEVEN R. ROTHMAN, New Jersey AMO HOUGHTON, New York JIM DAVIS, Florida TOM CAMPBELL, California EARL POMEROY, North Dakota JOHN M. McHUGH, New York WILLIAM D. DELAHUNT, Massachusetts KEVIN BRADY, Texas GREGORY W. MEEKS, New York RICHARD BURR, North Carolina BARBARA LEE, California PAUL E. GILLMOR, Ohio JOSEPH CROWLEY, New York GEORGE RADANOVICH, California JOSEPH M. HOEFFEL, Pennsylvania JOHN COOKSEY, Louisiana THOMAS G. TANCREDO, Colorado Richard J. Garon, Chief of Staff Kathleen Bertelsen Moazed, Democratic Chief of Staff Mark Gage, Professional Staff Member Marilyn C. Owen, Staff Associate C O N T E N T S ---------- WITNESSES Page Mr. E. Anthony Wayne, Principal Deputy Assistant Secretary, Bureau for European and Canadian Affairs, Department of State.. 8 Ambassador Larry C. Napper, Coordinator for East European Assistance, Department of State................................ 13 Ambassador James Pardew, Principal Deputy Special Adviser to the President and the Secretary of State for Kosovo and Dayton Accords Implementation......................................... 14 Mr. Janusz Bugajski, Director, East European Studies, Center for Strategic and International Studies............................ 32 Professor Janine Wedel, Associate Research Professor, George Washington University.......................................... 34 Dr. Daniel Serwer, Director, Balkans Initiative, United States Institute for Peace............................................ 38 APPENDIX Prepared Statements: The Honorable Benjamin A. Gilman, a Representative in Congress from New York and Chairman, Committee on International Relations...................................................... 48 E. Anthony Wayne, Principal Deputy Assistant Secretary of State for European Affairs........................................... 52 Ambassador Larry C. Napper, Coordinator for East European Assistance..................................................... 66 Ambassador James W. Pardew, Jr., Principal Deputy Special Adviser to the President and Secretary of State for Kosovo and Dayton Implementation................................................. 76 Janusz Bugajski, Director, East European Studies, Center for Strategic and International Studies: Problems of Balkan Reconstruction................................................. 84 Janine R. Wedel, Associate Research Professor and Research Fellow, The George Washington University: U.S. Aid to Kosovo: Lessons From Past Experience................................... 89 Dr. Daniel Serwer, Director, Balkans Initiative, United States Institute of Peace............................................. 95 Additional material submitted for the record: Responses to Questions for the Record submitted to E. Anthony Wayne by Chairman Benjamin Gilman.............................. 98 Newsbyte released June 21, 1999, by the United State Institute of Peace entitled: ``Moving Serbia Toward Democracy,'' submitted by Dr. Daniel Serwer........................................... 129 HEARING ON THE BALKANS: WHAT ARE U.S. INTERESTS AND THE GOALS OF U.S. ENGAGEMENT? ---------- Wednesday, August 4, 1999 House of Representatives, Committee on International Relations, Washington, D.C. The Committee met, pursuant to call, at 10 a.m., in room 2172 Rayburn House Office Building, Hon. Benjamin A. Gilman (Chairman of the Committee) presiding. Chairman Gilman. The Committee will come to order. This morning's hearing will help our Committee and its Members to better understand what America's future role will be in the Balkans. As the United States enters its second peacekeeping mission in the Balkans, with no end to those peacekeeping commitments yet in sight, that question is going to have to be addressed. Just last week, the President participated in a summit meeting on the region to show American commitment to a regional assistance initiative for Southeast Europe. We need to understand what that new commitment will entail. Let me quote an editorial about the meeting from yesterday's Washington Post: ``Mr. Clinton came to the conference armed with some concrete promises. The Europeans who have promised to take the lead in Balkan reconstruction offered no such specifics. If the Stability Pact is to have any meaning, Europe will have to ante up and do it soon.'' Since the end of the cold war, our Nation has provided roughly $7 billion in foreign aid and debt forgiveness to the 15 states of Eastern Europe, plus another $14 billion or more to the 12 states of the former Soviet Union. That figure does not include the billions of dollars in peacekeeping costs that our Nation has incurred and will now continue to incur in the Balkans. But when we add in these costs, we realize that we will soon reach and rapidly surpass an expenditure of $20 billion in aid and military costs in Eastern Europe alone, plus another $15 billion in the former Soviet Union. The point I am making is that America has done and is doing its share. Announcements of new American aid for the states of Southeastern Europe are in fact now made on an almost weekly basis. We must keep that in mind. I expect that our official witnesses today will give us a good estimate of what our Nation will commit to spend as a participant in the new Southeastern Europe Regional Assistance Initiative to which the President has pledged our support. News reports place the cost of the entire Southeastern European Assistance Initiative at $30 billion over a 5-year period. If our Nation were to finance only 20 percent of that total, it would equal $1.2 billion in U.S. aid alone for that region each year. I intend to join with my colleagues from New Jersey and elsewhere, Congressman Smith in particular, in introducing a bill that would authorize assistance specifically for the countries of Southeastern Europe, but that would lay out two important guidelines for our foreign aid to that region. First, a special authorization would be provided for funding to help the democratic opposition in Serbia. It is apparent that without democracy in Serbia there will be no stability in the Balkans. Second, that measure will underline the point that the European Union will have to take the lead in financing the regional assistance initiative by placing a cap on the U.S. financial participation in such an initiative. Democratization in Serbia and the European Union's lead on aid to Southeast Europe are both things that the President and officials of his Administration have said they fully support. I hope such legislation will have the President's support as well. We have a good roster of witnesses today to help us begin our review of our role in the Balkans. Our witnesses on behalf of the Administration include Mr. Anthony Wayne, Principal Deputy Assistant Secretary of State for Europe; Ambassador Larry Napper, State Department Coordinator for Assistance in Eastern Europe; and Ambassador James Pardew, Principal Deputy Special Advisor to the President and Secretary of State for Kosovo and the Dayton Accords Implementation. Our second panel will include Janusz Bugajski, Director of East European Studies at the Center for Strategic and International Studies; Professor Janine Wedel, Associate Professor at George Washington University; and Dr. Dan Serwer, Director of the Balkans Initiative, at the United States Institute for Peace. Before we begin with our first panel, let me ask our Ranking Minority Member, Mr. Gejdenson, if he would care to make any opening remarks. Mr. Gejdenson. Thank you. I just want to say that I generally agree with the Chairman's approach. I think that the United States, because of the assets that we have and the systems that were in place, played the leading role in the conflict. We expended the most significant portion of the cost of the war, and I do think the Europeans have to ante up, as will others in the world. We have, time and time again, taken the responsibility as the world leader. We like leading the world. We are ready to pay the price for that, but we don't want to end up being the sole economic supporter of these recoveries. I think it is clear that in putting together strategies in this region, we need strategies based on regional solutions, not country by country. Trying to do economic development in this region is almost, I believe, impossible if we take a nation-by-nation approach. When you look at the populations in these countries, you find that they are in the millions, not in the tens of millions. Occasionally you have a country that has a population of 10 million. I am going to look at my notes here. Kosovo has 2 million. What's left of Yugoslavia has about 11 million. Montenegro has just under 700,000; Bosnia, 3 million; Macedonia, 2 million; even Bulgaria, 8 million; Romania, 22 million; Slovenia almost 2 million. We need to have a policy that starts forcing the region to work together economically. There is nothing that binds the peace process like an economic relationship, and I know that in some ways the most difficult challenges are ahead. A military victory is a concrete and rather simple goal. To make sure that we are not in this situation 10 or 50 years from now, we really need to promote economic development in the region. I commend the Chairman for holding this hearing. Chairman Gilman. Thank you, Mr. Gejdenson. Chairman Gilman. Mr. Smith. Mr. Smith. Thank you very much, Mr. Chairman. Mr. Chairman, I believe that the issues we are addressing in our hearing today are of critical importance. Obviously, the troubles of Southeastern Europe have had a tremendous impact on the development of U.S. foreign policy in the 1990's, following the cold war. While we do have strong regional interests, the Yugoslav conflict has put us face-to- face with how seriously we take human rights and humanitarian issues as part of our foreign policy, even when national interests may not be otherwise so apparent. Indeed, we hopefully have learned from the tragedy of the Balkans in the 1990's, what those involved in the Helsinki process have known for a long time, namely that there is no true peace without human rights and there is no long-term stability without democratic government. In Bosnia and in Kosovo, what we saw was genocide, and there is no greater moral imperative than to prevent genocide from taking place. There may also be no greater challenge. Our challenge now in the region is to bring democracy to places where it did not previously exist, at least in any durable form. In Southeastern Europe, decades of Communist rule have been followed by an intense, direct and violent assault by extreme nationalists on innocent civilian populations. The effects of endless propaganda are hard to reverse. The effects of witnessing family members being slaughtered are even harder. However, Mr. Chairman, if we are committed in the long term to assisting democratic forces in the region and promoting social tolerance, we can and we will make a difference. That is why I have been a strong supporter of efforts to support democratic development in the region. We simply must understand that some changes could be quick; but not all of those changes can be quick, and we must remain committed to supporting democracy for as long as it takes. Mr. Chairman, as you know, the Helsinki Commission, which I chair, has for a full decade encouraged democratic development in each of the republics and provinces of the former Yugoslavia. Through election monitoring, Congressional visits, public hearings and briefings and proposed legislation, the Commission has persistently brought close scrutiny to the halting transition before, during and after the eruption of violent conflict. As you know, Mr. Chairman, early in this Congress, I introduced both H.R. 1064, the Serbia and Montenegro Democracy Act and H. Con. Res. 118 regarding the culpability of Slobodan Milosevic for war crimes, crimes against humanity and genocide. I view both bills as critical and related to each other. The problems which led to the former Yugoslavia's violent demise may have historical roots and the region's contemporary leaders, as well as society as a whole, may all share some responsibility for perpetuating these problems. However, if it were not for the presence of Slobodan Milosevic and the complete absence of even one ounce of goodwill in that man, these problems certainly would have been resolved without violence on the scale that we have seen, if at all. I want to thank you, Mr. Chairman, for allowing these two pieces of legislation to move forward. I believe that our witnesses are familiar with the language of these bills and I trust that they will comment on these bills. As you know, Mr. Chairman, tomorrow we plan to introduce a new bill, addressing a number of issues in Southeast Europe. I support your notion that H.R. 1064 and H. Con. Res. 118 should move forward in a more comprehensive way, combined with other regional efforts. I also wish to thank you for holding this hearing in which we will hear from Administration views on efforts to promote democracy in the region, as well as insight from the panel of experts and I particularly want to acknowledge Janusz Bugajski and Daniel Serwer, who are each going to be on panels. They have testified before our Commission twice, Mr. Chairman, and they do provide excellent insights. Dr. Serwer, in fact, presented a paper to the Helsinki Commission last December, which was the inspiration for H.R. 1064. The paper became famous when Serb nationalists in Belgrade sought to present it as a covert CIA document designed to overthrow the Yugoslav and Serbian regimes. So I want to thank Dr. Serwer again for his very fine insights that helped us draft that bill. I look forward to our hearing and thank you, Mr. Chairman. Chairman Gilman. Thank you, Mr. Smith. Chairman Gilman. Mr. Payne. Mr. Payne. Thank you very much, Mr. Chairman. Let me also say it is very important that we have this hearing at this time. What are the U.S. Interests and goals of U.S. Engagement? I think that is a very comprehensive question, and I look forward to hearing testimony from our witnesses. I think that we certainly won the war in Kosovo. The question is, can we win the peace? That is going to perhaps be much more difficult than winning the war. Under the iron fist of Marshal Tito for 40 years, it appeared as though ethnic tensions were nonexistent, because the state became so overpowering there was very little expression overtly of the difficulties and tensions that have gone on for decades, for centuries, in that region. With the breakup of the Warsaw Pact and the passing on of people like Marshal Tito and other tyrants who, I think, did more damage than good; although the ethnic tensions were sort of subliminal, there was no work done at educating and breaking down these decades or these centuries of ethnic tension. With the new wave of democracy--you know, democracy means a lot of things to different people--these tensions tend to have surfaced again. So we certainly have a lot of work to do. I had the opportunity to visit most of those countries in the 1960's and very early in the 1970's--Russia, Romania, Hungary, Czechoslovakia, and Yugoslavia, Austria--and the repression of the government there, as I indicated, kept these differences from surfacing. But I think we have a challenge ahead of us. I think it is in our interest. I think it was the right decision for President Clinton to take the bold step. War is always unpopular and it takes courage to do the right thing. I think the President did the right thing. Now we have to complete the task. Thank you very much, Mr. Chairman. I yield back the balance of my time. Chairman Gilman. Thank you, Mr. Payne. Chairman Gilman. Mr. Rohrabacher. Mr. Rohrabacher. Well, the jury is still out on whether or not we did the right thing in the Balkans, and we will find out when we examine exactly what the cost of that operation was to the people of the United States. I mean, after all, we have a President now who says we can't afford tax cuts, which means giving billions of dollars back to the American people; and we have debates as to how much money we can spend on Social Security, how much money we can spend on various other things that are important to the quality of life and to the health and safety of our own people. And we will do that within the context of having spent whatever we did spend--and I hope to get into that with you today--as to what the costs and ongoing costs of the Balkan operation were all about. We need to know what has already happened, the short-term costs, as well as the long-term costs. We also should know whether or not this has created some type of dependency attitude by our European allies on the United States of America. The armed forces of the United States of America, should not be looked at as a foreign legion, as a resource for Europeans who should be shouldering more of the responsibility for their own stability and peace. And if we have now created a situation where our European allies don't think they have to spend more for their own defense and they can rely on the United States, then the costs will be much higher than what we have ever imagined for this operation. Oversight hearings like this will help us determine what policies our government is following, know what those policies actually are and what policies we should be following. I would like to congratulate Chairman Gilman on the leadership that he has provided during this entire crisis. One last note: When we talk about oversight--I will make this very short because we have Administration officials here-- this is one Member of Congress who has tried to have an oversight over our policy in Afghanistan. For over a year I have been requesting documents, and the Members of this Committee understand that. I am a Member of this Committee who has a special interest in Afghanistan. At long last, I would like to inform the Members of our Committee that documents that we requested about diplomatic decisionmaking about Afghanistan were sent to us and let you know most of them were newspaper clippings. In other words, the State Department thumbed its nose at this Committee, thumbed its nose at our oversight responsibility and has insulted us after a year-long stonewalling and putting up roadblocks for us to get the information about what our policy is concerning Afghanistan and the Taliban. So with that, I will thank the Chairman for calling this oversight hearing so we can at least understand what the Administration's policy is here, even though they are engaged in a policy of deception in terms of a covert policy of supporting the Taliban in Afghanistan. I yield back the balance of my time. Thank you very much, Mr. Chairman. Chairman Gilman. Thank you, Mr. Rohrabacher. Chairman Gilman. Mr. Hastings. Mr. Hastings. Mr. Chairman, thank you for holding this hearing. I appreciate very much the witnesses that have assembled. I am sure that the information they impart will be of immense benefit to all of us. My good friend, Dana Rohrabacher--and he is my good friend--continues to amaze me. He and I enjoy a good debate. I heard you say, my dear colleague, and I agree, that we should be concerned about the short-term costs and the long-term costs. There also is a correlative, and that is the short-term benefits and the long-term benefits. This should not be looked at just as a cost factor when, in fact, stability in Europe benefits America immensely. And I can't understand how everybody does not understand that. Mr. Chairman, the crisis in Kosovo must lead all of us to reexamine how we view our place not only in Europe but in the world. As the world has changed, many of the key institutions, particularly European institutions, the European Union, Organization for Security and Cooperation in Europe, NATO, and indeed the United Nations have changed. Even though we are an ocean away, Americans know that in today's world of fungible borders and, Mr. Rohrabacher, the world is in interconnected conflicts, gross violations of human rights have become everyone's business. Having achieved our short-term goals in Kosovo, we must now establish a set of long-term goals for Southeastern Europe. Indeed, what we do now will seal the fate of Europe for the next century. Will there be stability? Will the rule of law be followed? Will there be peace? Will the waters be clean, the air breathable, and the rivers passable for commerce? Will ethnic and religious tensions erode? Will it be possible to attract investment? Our goals are simple, and I believe the Administration and others will put forward many of the terms of those goals: to alleviate tensions, prevent conflicts, promote the development of stronger civil societies which follow the rule of law and respect human rights, encourage the growth of strong and stable economies, raise the living standard for all Europeans and indeed by that raise our own living standards, assist economic and environmental regeneration and establish regional cooperation in the battle against corruption and crime. The people of the Balkans have known centuries of war and fear. This simply cannot continue. We cannot allow insecurity in Kosovo to engulf her neighbors. Montenegro, Albania, Romania, Bulgaria, indeed Hungary and others--they are all threatened by the civil and economic instability which has enveloped Kosovo. If we do nothing, they may also be consumed. By working together, we can transform the Balkans from a historic site of conflict and instability into the fabric of a stable and successful Europe. America can and should be a part of that transformation. And I agree with my colleagues who say that the Europeans should take not only the lead but the lion's share, and I know of no Europeans who have said anything any different. When visiting the Organization for Security and Cooperation in Europe, when I was with Amo Houghton in Ireland, everywhere we went, in London, we find the Europeans say they understand that they have that responsibility. I applaud President Clinton for his efforts to bring about a resolution to the crisis in the Balkans, and for his leadership in instigating the Stability Pact for Southeastern Europe, but the larger burden, obviously, must be carried by Europe. All of us abhor violence. The violence must stop, no matter who the perpetrators are. Our resolve, America's resolve, our commitment, America's commitment, should not be diminished at this time. It is time for us to insist that the United Nations move expeditiously to establish peacekeeping forces on the ground in Kosovo and appropriate training to establish a system of justice. Thank you, Mr. Chairman. Chairman Gilman. Thank you, Judge Hastings. Chairman Gilman. Mr. Delahunt. Mr. Delahunt. I think Mr. Pomeroy is next. Chairman Gilman. Mr. Pomeroy. Mr. Pomeroy. Thank you, Mr. Chairman. Very briefly, I think the jury is definitely in on the Balkans conflict relative to Kosovo. Milosevic lost. NATO won. Nothing could be more clear. The sharp partisan tone of the debate relative to the Kosovo conflict that unfolded during the months of the conflict in the House of Representatives did not distinguish this body. It is my hope that beginning right now, beginning with this hearing, we can move into the post-conflict debate in a much more reasoned, sensible way. There is nothing Republican or nothing Democrat about that--instinctively or naturally arising from the difficult questions of winning the peace in Kosovo and the Balkans generally. We are going to have to work together and fashion reasonable, thoughtful policy. The American people deserve no less, and I hope that we can move to a higher plane than the discussions during the conflict itself. I yield back. Chairman Gilman. Thank you, Mr. Pomeroy. Chairman Gilman. Mr. Delahunt. Mr. Delahunt. Yes. Thank you, Mr. Chairman. I would associate myself with the remarks by Mr. Pomeroy. I would just make one observation. I would submit that the costs of instability in the region would simply be too high, and I would note that this government and this nation for some period of time has, in the Middle East, supported stability in the form of assistance to both Israel and to Egypt, and I think the cost has been well worth it. It is my understanding, and maybe a colleague could help me, that on an annual basis it amounts to somewhere in excess of $6 billion. Mr. Payne indicates yes. And I dare say that nobody on this panel would say that the costs of stability in the Middle East is too high, because the perils and the dangers both in the Middle East and in the Balkans are truly unacceptable. So I think it is important we have a perspective here. Yes, the war was costly and the peace will be costly, and again as Judge Hastings indicated it ought to be--the lion's share ought to be absorbed by the Europeans, but at the same time we have a vital interest. And I yield back. Chairman Gilman. Thank you, Mr. Delahunt. We will now take testimony from our witnesses. Chairman Gilman. Mr. Anthony Wayne had wide-ranging experience with our Department of State. Before assuming his current position as Principal Deputy Assistant Secretary of State for European and Canadian Affairs, he served as the Deputy Chief of Mission to the European Union. We welcome Mr. Wayne. Before that, Mr. Wayne served over many years at our National Security Council, the Office of the Ambassador at Large for Counterterrorism and as Special Assistant to the Secretary of State at our embassies in France, Morocco, and at the Bureau of Intelligence and Research. During a leave of absence, Mr. Wayne worked as a correspondent for the Christian Science Monitor. Mr. Wayne, you may summarize your written statement. It shall be placed in the record. Please proceed. STATEMENT OF MR. E. ANTHONY WAYNE, PRINCIPAL DEPUTY ASSISTANT SECRETARY, BUREAU FOR EUROPEAN AND CANADIAN AFFAIRS, DEPARTMENT OF STATE Mr. Wayne. Thank you very much, Mr. Chairman. It is a privilege to be here today, and I thank you and the Members of the Committee for this opportunity to discuss in some detail the basis for and the elements of our policy toward Southeast Europe. I am very happy to have with me Ambassador James Pardew, our Deputy Special Advisor for Bosnia and Kosovo, and Ambassador Larry Napper, the Coordinator for East European assistance. Each of them will discuss in some more detail, following my remarks, what our policy is in their area of responsibility. But what I would like to try to do is talk a little bit about the overarching policy and programs, the U.S. Interests at stake, our objectives and the approaches and tools that we are trying to use to achieve those objectives and to indeed achieve maximization of our interests. I thought what I might do, to open with, is give a succinct statement of our policy, which came from a speech which President Clinton gave in San Francisco on April 15, and I will just quote from that, because I think this is a good clear overview of what we are trying to do. ``Because stability in Europe is important to our own security, we want to build a Europe that is peaceful, undivided and free. We should try to do for Southeastern Europe what we helped to do for Western Europe after World War II and for Central Europe after the cold war; to help its people build a region of multiethnic democracies, a community that upholds common standards for human rights, a community in which borders are open to people and trade, where nations cooperate to make war unthinkable . . . the best solution for Kosovo, for Serbia, for Bosnia, Croatia, Macedonia and all the countries of Southeast Europe is . . . greater integration into. . .Europe. . . .'' I will discuss a bit later this past week's Stability Pact Summit meeting in Sarajevo. That summit demonstrated our commitment and the commitment of the leaders of the region and indeed of the broader international community to make this integration into a reality. There are three goals which we are pursuing in Southeastern Europe: The stabilization of the region; its transformation into a community of thriving democratic polities and vibrant market economies; and the integration of the region into the broader European transatlantic and global, political, and economic structures. We are pursuing these objectives in a broad range of institutions and programs, and let me just briefly list them because there are a number here: The Dayton implementation process; the Kosovo peace process; the support for east European democracy or SEED program, which Ambassador Napper administers; the Southeast European Cooperative Initiative known as SECI; NATO's Partnership for Peace and Euro-Atlantic Partnership Council; the Royaumont Process; the EC/World Bank donor coordination process; the Southeast Europe Defense Ministers group; and several others. Finally, and most importantly for the medium and long-term prospects in the region, we have established with our partners, as has been mentioned, a Stability Pact for Southeast Europe. This pact has the promise of providing a unifying framework to achieve the broad political and economic reform and the greater integration of the region into Europe, which so many of us seek. I would like to present our approach to Southeast Europe, first by discussing the programs and approaches that are most geographically focused, and then talking a bit about the broader and the longer term efforts that are underway; particularly in that sense, the Stability Pact being the broadest of these. First, there are the Kosovo and Bosnia elements which Ambassador Pardew will address in more detail. Kosovo clearly presents an immediate security, political, economic and humanitarian challenge for all of us. KFOR's deployment has improved the security environment dramatically, but we need to sharpen our focus on improving internal security. We must also establish the political mechanisms called for in the peace agreement and make the transition from meeting urgent humanitarian needs to laying out the basis for a self- sustaining and productive market economy. In Bosnia, local governmental and police institutions are beginning to gain authority and popular legitimacy, which they need to ensure domestic security. But the economy still has a long way to go, and there is much that needs to be done there. I want to stress the importance of getting the Dayton and Kosovo process right. These are intensive tests of the international community's willingness to see peace take hold. Second, a word about Serbia. It is clear that Serbia continues to pose a serious challenge to regional stability, including the democratic government in Montenegro. The loss of Kosovo to KFOR and the U.N. Civil Administration has left President Milosevic weakened and discredited domestically. Milosevic is an international pariah and an indicted war criminal. As long as he and his regime remain in power in Belgrade, Serbia and the FRY cannot take their place among the community of democratic nations, a message that was made very clear at the summit in Sarajevo last week. President Clinton has clearly stated our policy. As long as the Milosevic regime is in place, the United States will consider providing humanitarian assistance through international organizations but not reconstruction assistance to Serbia. Helping to rebuild Serbia's roads and bridges would funnel money directly into the pockets of Milosevic and his friends, prolong the current regime, and deny Serbia the hope of a brighter future. We are working very closely with our friends and allies in Europe to coordinate our activities on Serbia and to forestall any weakening of the existing sanctions regime against the FRY. A key aspect of our policy on Serbia is indeed support for democratic change. We want to support those forces in Serbian society working to this end. We want to nurture the struggle for democracy, but at the same time I do not want to overemphasize our ability to effect change within Serbia. Milosevic maintains a firm grip on the main levers of power and the Serbian opposition remains far from united. But regardless, our support for democratic forces is an investment in Serbia's future. We look forward to working together with Congress to bring democracy to Serbia and restore real stability in the region. Albania, too, in the region, is a potential source of regional instability, as was demonstrated by its near collapse in March 1998. Although we have been obliged to reduce our presence in Albania for security reasons, we are continuing to work to address the security concerns and support political stabilization, economic reform and development in that country. We are now increasing our presence and our programmatic support. We are particularly encouraged by the responsible and restrained approach taken by the Albanian authorities during the Kosovo conflict and the reception accorded to the hundreds of thousands of Kosovar refugees. Albania was instrumental to our success in Kosovo. We feel strongly that its role should not be forgotten. We are restarting several of our bilateral assistance programs, largely focusing on combatting corruption and restoring public order. We participate actively in the Friends of Albania Organization, with many of our European allies and partners. Through that organization, we have established benchmarks for progress in Albania. We support the actions recently taken by the prime minister of Albania and the government to establish an effective rule of law. Progress has been slow, and, due to the nature of Albania's problems, we are going to have to show patience and persistence in order to bring about the long-term change that is desired. Third, for several years we have sought to address the problems of Southeast Europe in a broader context. Looking at the region as a whole, and increasingly since early this year, we have focused on a post-conflict strategy for renewal of the entire region. This strategy has many different elements, but the focus most broadly, of course, is on the three key project areas: Security, economic development, democracy and human rights. First, on the security side, we are working bilaterally with many of the countries in the region, but we are also concentrating our work through the NATO framework. At the April summit here in Washington, the Alliance established a special consultive forum for the members of the alliance plus the seven countries of the region on security that has begun to review regional proposals on crisis management, military-to-military cooperation, infrastructure ideas, and promotion of a democratic media. We have also agreed that the summit could develop mechanisms to better coordinate the security assistance to the region from the various allies. And we are working with the allies to implement this and other decisions on a rapid basis. The EAPC, that is, the Euro-Atlantic Partnership Council, which functions within the NATO structure, also created a working group on regional cooperation for Southeast Europe, which is going to look at defense planning, crisis management, and regional air space management. We are also supporting the efforts in the region, and particularly of note here is the Southeast Europe defense ministerial process that is really something built from the region up, bringing defense ministers together to look at regional cooperation, efforts that they can take together to promote peace, security and military reform. To encourage democratization, we have worked for many years now on a variety of programs, including the SEED program, and with a variety of groups and institutions, including the National Endowment for Democracy, to promote democracy. That also has included cooperation with the OSCE and with the European Union. Economic reform and development, of course, have also been a long, standard priority of what we have been trying to do, with the SEED program providing funding to support policy and administrative reform as well as infrastructure development. An important aspect of our post-World War II reconstruction efforts in Europe was our encouragement of regional cooperation. The states of Southeast Europe, with U.S. support, have built this regional cooperation in a number of different fora. I would like to highlight one, the Southeast European Cooperative Initiative, where we worked with states in the region really to have the first overarching coordinated regional approach to many of the economic troubles which plague the region. Eleven states have come together with the U.S. and other partners to pursue cooperative efforts, looking, for example, at cross-border crime and corruption. The FRY is not a member of this but Montenegro has attended on a regular basis now the SECI meetings as an observer. SECI participants have committed to join in measures to encourage trade and commerce and to make the region more attractive to private investors. The first two agreements, which they recently signed, have to do with harmonizing road transport and providing a sharing of information to combat cross-border crime. Mr. Smith.--[Presiding.] Mr. Wayne, sorry to interrupt. We have about five minutesremaining before we have to report to the floor. Mr. Wayne. OK. Mr. Smith. I apologize to our other witnesses as well. There are two votes and then the Chairman and many others will return to hear the conclusion of your testimony. So I do apologize. The Committee stands in recess until the votes are over. [Recess.] Mr. Houghton.--[Presiding.] All right. Gentlemen, thanks for your patience. We would like to reopen the hearing. And maybe you would like to finish up your statement, Mr. Wayne. Mr. Wayne. Yes. Let me quickly finish up the basic point I wanted to make about the SECI organization that this is largely a self-help program and has not cost the U.S. taxpayer more than very modest amounts, but is producing very concrete results. Let me just say a little bit about the Stability Pact and the summit which took place in Sarajevo last Friday. The Pact itself is a mechanism or, if you will, a process to bring together all of the many ideas, the many organizations, the many actors, at work to help integrate Southeast Europe into the transatlantic and European mainstreams. And so, what we are really talking about here is a forum to facilitate that can provide political coordination and a degree of comparative analysis for these ideas. We hope it is a process that can make more efficient, more effective, and more coherent all of the international and regional efforts that are going underway. The Pact is not a funding or an implementing agency; indeed it is a fairly lean international structure. So any proposals that are developed in the Pact would actually have to be carried out and implemented by other agencies. We foresee no large bureaucracy being developed in this context. The Pact proposals in the economic field requiring funding would go to the EC/World Bank chaired process, donors process, where they would be analyzed and assessed there, and we, of course, are a member of the high-level steering group guiding that process. Last week in Sarajevo, if I might go on, President Clinton and other leaders offered their comments on the future of Southeast Europe. The President took the opportunity to put forward several initiatives which we can talk about in more detail; these included $10 million to aid the efforts for democracy in Serbia. They included a proposed investment compact to spur investment in the region, a number of ideas associated with that, and the trade expansion initiative. Now on all of these, of course, as the President made clear, we look very much forward to working with Congress as we develop these ideas and as they go forward. But Sarajevo itself wasn't just about what people were offering or putting on the table. What was very significant was the clear commitment of everybody there to work together as partners to make this long-term process of integration a success. The clear message from leaders of the region that they knew they shared responsibility to work among themselves to undertake reform; the clear message from those outside the region that they had to respond concretely to those steps by the regional leaders. This was very important. In sum, I might just say that few of us could have foreseen or would have foreseen the depth of our engagement in Southeast Europe today. But I think few would deny that to engage in the region, to bring the states of Southeast Europe into the Euro- Atlantic community of prosperous, secure, and democratic nations is a task and, indeed, an opportunity that must not find us wanting. Thank you. Mr. Houghton. Thanks very much, Mr. Wayne. [The prepared statement of Mr. Wayne appears in the appendix.] Mr. Houghton. The next witness is Ambassador Larry Napper, who serves as Coordinator of Assistance to East Europe after a long career with the State Department. After service with the United States Army, Ambassador Napper joined the Foreign Service and rose to a number of important positions in our diplomatic core including key positions at the Embassy in Moscow, Deputy Chief of Mission at the Embassy in Romania and Director of Department's Office of Soviet Affairs and Ambassador to Latvia. So, Ambassador Napper, we are delighted to have you here. Would you please proceed. STATEMENT OF AMBASSADOR LARRY C. NAPPER, COORDINATOR FOR EAST EUROPEAN ASSISTANCE, DEPARTMENT OF STATE Mr. Napper. Thank you very much, Mr. Chairman. Given Mr. Wayne's detailed statement and our desire to get to your questions, I just want to make three points really about the SEED program and the role that it plays in our overall strategy in Southeastern Europe. First of all, SEED works; it is a demonstrated performer. If you look at the program over the past 10 years, we have graduated eight countries from the SEED assistance program. That means eight countries that were, at one point, recipients of our bilateral assistance have now progressed to the point where they no longer need direct U.S. bilateral assistance. In fact, SEED graduates are members of NATO and partners of NATO and aspiring companies for the European Union, so this is a program with a demonstrated track record. Elsewhere in the region, in Central and Northern Europe and, if we continue and if we persevere, in Southeastern Europe, we can achieve the same results because we can show a demonstrated track record. The second point I would make is that SEED is flexible. It allows us to do activities across a range from technical assistance to support for peace implementation in Bosnia and Kosovo, to the promotion of regional projects. Mr. Gejdenson's point about supporting development of the Southeastern Europe as a region--we can do that through SEED, and we are doing it. And finally, with small amounts of SEED assistance to these countries, we can help them create a climate to promote trade and investment, because the private sector is really the engine that is going to transform Southeastern Europe. So SEED works; it is flexible. My third point is, it is a bargain. Our SEED assistance program this year for all of Central and Eastern Europe began at $430 million, 370 of which was dedicated to Southeastern Europe. With the budget supplemental that the Congress passed and the President signed in May, we now have a total of $490 million in SEED assistance going to Southeast European countries. Mr. Chairman, that is 3 percent of the 150 Account, the total 150 Account. So it is a minuscule part really of what we are doing overall in foreign affairs; and if you compare that to the overall Federal budget at large, you can see what we are doing here is a program that is modest in size, cost effective, and I say again it works. So with that, Mr. Chairman, I would like to conclude and be glad to take your questions. Thank you. Chairman Gilman.--[Presiding.] We regret the interruption for voting. [The prepared statement of Mr. Napper appears in the appendix.] Chairman Gilman. Our next official witness, Ambassador James Pardew, was appointed to his current position in March of this year after being appointed to the rank of Ambassador in 1997. Ambassador Pardew has a long record of service with our military from which he has a number of decorations. Among other positions, Ambassador Pardew served with the staff of the Joint Chiefs in the Army General Staff and completed a number of foreign tours of service. Entering into the risky field of foreign policy, after that military career, the Ambassador served as Representative of the Secretary of Defense at the 1995 negotiations on the Dayton Accords for Bosnia and then as Director of the ``Military Train and Equip Program'' in Bosnia from 1996 to 1999. Mr. Ambassador, we welcome you. You may summarize your written statement and put the full statement into the record as you may deem appropriate. Please proceed. STATEMENT OF AMBASSADOR JAMES PARDEW, PRINCIPAL DEPUTY SPECIAL ADVISER TO THE PRESIDENT AND THE SECRETARY OF STATE FOR KOSOVO AND DAYTON ACCORDS IMPLEMENTATION Mr. Pardew. Thank you, Mr. Chairman. I will submit a statement for the record. And I will just highlight its points, keying on some points that the Members made in their opening statements. First of all, throughout this century the stability of Europe has been of vital interest to the United States; and ethnic conflict in Southeastern Europe clearly is a direct threat to European stability and, therefore, is a threat to the U.S. National interests. That is why we have invested so much time, energy, and resources in former Yugoslavia over the past 10 years. That is why American troops have been in Macedonia since 1993, in Bosnia as part of a NATO-led force since 1995, and now in Kosovo as part of the NATO-led force implementing the agreement that followed the successful air campaign. These military deployments are not a permanent solution, however. Long-term regional stability requires active and robust political and economic development. I will talk about primarily Kosovo and Serbia and skip over the Bosnian peace. But in Kosovo, we have to rebuild civil society from the ruins of the savage campaign which Milosevic waged against the population. Our immediate steps to create an autonomous democratic society were successful in the successful air campaign and the return of over 700,000 of the 800,000 refugees expelled from Kosovo. Currently, more than 37,000 troops from 21 nations are deployed there, including 5,500-5,600 U.S. forces. K-4 is rapidly establishing a secure environment. Separately, the U.N. Administration for Kosovo, UNMIK, is making steady progress in deploying civil administrators, civilian police and judicial authorities to the field under extremely difficult circumstances. UNMIK has a very powerful mandate sufficient to create the foundations of a democratic society. And while it is deploying, it still has a very long way to go. We are doing everything that we can to urge contributing companies and the U.N. to deploy as soon as possible. I want to highlight last Wednesday's immediate needs conference in Brussels, which focused on humanitarian requirements and where donors pledged to provide nearly $2.1 billion in humanitarian assistance. The United States pledged $556 million in assistance for urgent humanitarian needs, subject to clear assessment of the need and a confirmation that other donors will do their part. This money comes from the budget supplemental passed by the Congress and signed by the President on May 21st of this year. None of this funding will go for reconstruction in Kosovo or long-term development in Southeastern Europe. The follow-on donors conference in the fall will concentrate on assistance for reconstruction for which the Europeans will bear the bulk of the burden. An urgent item on UNMIK's agenda is the creation of a civilian police force. The U.N. plans to deploy 3,100 international police; they will be armed and have arrest authority. This is a new development for the U.N. We intend to provide 450 of these police. This is an interim step until we can train 3,000 indigenous police, and the U.S. is playing a leading role in that effort in training local police as well. Further down the road, democratization will require active and pluralistic political life. Our goal is to hold elections in Kosovo as soon as feasible. I will skip over the Bosnian peace only to say that we have obviously had significant success there, but we still have a way to go on such things as refugee returns, economic restructuring, and the strength of state institutions. Finally, let me speak a moment about democratization in Serbia, because long-term stability in the region requires Serbian leadership committed to democracy and the rule of law. President Clinton has made clear that there will be no reconstruction assistance to Serbia as long as the Milosevic regime is in place. Over the past several weeks, Serbia citizens have shown their disgust for Milosevic and their hunger for democratic change through spontaneous demonstrations in the streets and cities throughout the country. These are positive developments, and we should nurture them. At the same time, I don't want to raise expectations that the Milosevic regime will fall easily or soon. Over the past two years, the U.S. Government has--and NGO's like NDR, IRI and NED have spent $16.5 million on democratization projects. In Sarajevo last Friday, the President announced he will work with the Congress to provide 10 million this year and more over the next 2 years to strengthen independent media, NGO's, independent trade unions, democratic opposition. And we look forward to working with this Committee, Mr. Chairman, in that regard. Our democratization programs focus in three areas: first is assistance to opposition parties; second, in promoting independent media and the free flow of information; and third, we give special importance to support for Montenegro. President Djukanovic and the multiethnic democratic government in Montenegro have demonstrated courage and determination, and we want to support them as a model for change in the FOY. Mr. Chairman, that concludes the summary of my points. I will be open to any questions you may have. Chairman Gilman. Thank you, Mr. Ambassador. [The prepared statement of Mr. Pardew appears in the appendix.] Chairman Gilman. We will proceed with questions for the entire panel. Our nation has appropriated about $400 million annually in recent years for our SEED Act assistance program, the major U.S. aid program for Eastern Europe, and, combined with other forms of aid, U.S. assistance in the entire region has probably exceeded $500 million per year. Can our panelists tell us what the Administration will now be seeking for aid to Southeast Europe in fiscal year 2000 and what the Administration will commit to provide annually in such aid to Southeast Europe under a regional assistance initiative? And will that amount be larger than the current aid provided annually in Eastern Europe and, if so, by how much? I would welcome any of our panelists' response. Chairman Gilman. Ambassador Napper. Mr. Napper. Yes, Mr. Chairman. I have got it turned on now. Thank you, Mr. Chairman. The President's current budget requests for the SEED assistance program for 2000 is $393 million. In the context of consideration of that on the Hill, the director of OMB has said that there will be a budget amendment submitted by the Administration, and we believe that, in fact, a budget amendment will be required. Now, I am not in a position today to say exactly what the level is that we will be recommending. That is still being developed within the Administration, and we want to work with you up here on the Hill, this Committee and others, to come to an appropriate level for seed assistance in 2000. Chairman Gilman. Thank you. James Wolfensohn, the President of the World Bank, has stated his fears that aid to the Balkans may siphon off aid needed to respond to the humanitarian crises in Africa and Asia, and he specifically cited the hundreds of thousands of refugees and internally displaced persons who were forced from their homes by the conflict over the region of Nagorno-Karabakh in Azerbaijan earlier in the decade and who have been living in abysmal conditions ever since. How do we respond to that concern? I welcome a response by any of the panelists. Mr. Napper. Well, certainly, Mr. Chairman, we recognize that there are requirements everywhere in the world which do require our attention. One fact, though, that I mentioned, if you look at the size of the SEED assistance program, in the context of the entire 150 Account, the entire foreign affairs account, which is about 3 percent of the 150 Account, I would not say that historically our SEED assistance program has been particularly large--has loomed particularly large in our overall assistance programs worldwide. I would anticipate what we are talking about, I would describe, is fairly modest increases in order to deal with the situation that we found there and to try to bring stability to an area which has after all cost us a number of millions of dollars in terms of fighting military campaigns and conflicts. We would like to avoid that by a reasonable and modest investment of assistance funds. Chairman Gilman. Would any of our other panelists want to join in answering? Mr. Wayne. Mr. Wayne. Just to add that, as you well know, Mr. Chairman, historically this region has been the source of much conflict during this past century, and now there is indeed a strong consensus, as evidenced by the Stability Pact Summit, of the need for a long-term effort to really integrate this region so that will not be the case in the future. And certainly we believe that is worth the investment of time and effort to do so. Just to note, Mr. Wolfensohn was present at the summit and that the World Bank is intimately involved in the thinking and planning that is going to go on for both Kosovo reconstruction and the broader reconstruction in the region. Indeed, the World Bank is one of the co-chairs of the donor coordination process. We have counted heavily already on their expertise and their guidance in developing the thoughts that we have so far, and as we look at the needs for the region, they will be a key player in pulling that needs-assessment together. Chairman Gilman. Ambassador Pardew? Mr. Pardew. I have nothing to add, Mr. Chairman. Chairman Gilman. Let me move on to another issue. In June, a spokesman for Carlos Westendorf, the head of the international effort in Bosnia, stated that corruption there involves hundreds of millions of dollars annually. Westendorf's deputy, Jacques Klein, had stated earlier that corruption in Bosnia was the largest single obstacle to that country's ever becoming independent of aid programs. Can you tell us what is being done to halt such corruption, what plans been made to eliminate that kind of corruption in Kosovo, and what planning will be undertaken to eliminate such corruption throughout Southeastern Europe as the new regional assistance initiative takes hold? Mr. Pardew. Mr. Chairman, let me speak of Bosnia. Chairman Gilman. Ambassador Pardew. Mr. Pardew. We are very much concerned about the issue of corruption in Bosnia and the potential, for that matter, of corruption in Kosovo. As I have said in my written statement to the Committee, we are not yet happy with the level of economic reform in Bosnia. We have put forth to the government, both the entities and the state government, proposals which would reduce the potential dramatically for corruption in that area. We are also working with the police and the international institutions to tackle this problem. But this is a long-term problem, and it requires structural reform in Bosnia. In Kosovo, we are working with the United Nations, the World Bank, and others to provide the immediate technical assistance to create the proper institutions that would reduce the potential for corruption there. Chairman Gilman. Thank you. Chairman Gilman. Mr. Pomeroy. Mr. Pomeroy. Thank you, Mr. Chairman. And first of all, I want to commend you for holding this very important hearing, clearly the complexities of what we are addressing require this Committee to learn everything we can and monitor the situation closely for the foreseeable future. My first question would be to Ambassador Napper and would involve your expertise with the former Soviet Union. What are the ongoing ramifications of the Kosovo conflict for our relationship with Russia? Mr. Napper. Well, Mr. Pomeroy, I am not working on Russia right now, but let me just answer your question the best way I can. Certainly, the issues surrounding this conflict have been at the center of much of our dialogue with Russia over the past few weeks and months. We have not always agreed at every point during the conflict about what should be done at the time. But I think at the end of the day, we have been able to cooperate with the Russians at very important points in the conflict. Mr. Pomeroy. Do you have a sense in terms of the lingering ramifications, whether the nationalists are still very much fueled by our involvement in the conflict? It seems to me that it is dying down very quickly. Mr. Napper. I think there is always a range of political opinions and viewpoints in Russia, that has always been my experience; and I don't think things have changed since then. Russia is now a democratic country and there are a lot of voices that get expressed. But, I think what is important for us is the policy that is followed by Russia. And at the end of the day, after a lot of back and forth and pulling and hauling, in fact, the Russians at key points have been helpful in trying to find a way to resolve the military aspect of the conflict and to bring the peace on the ground. And maybe Ambassador Pardew would like to add to that. Mr. Pomeroy. I think that answers my question adequately. I have a question though for Ambassador Pardew. It relates to the suggestion, and it is an important point, does this make Europe more dependent upon United States military intervention or does it indeed humble them and make them rededicated to developing a more effective European defense force to develop--to deal with European security matters? It seems to me that the comments--in particular, Prime Minister Tony Blair, would support the latter conclusion that, if anything, the aftermath in Europe in terms of this conflict is that they have got to do a better job of developing a coordinated military capability and execution. Mr. Pardew. I think there are two elements to your question, sir. First is a technical military one, and you really need to ask the Pentagon, because I think there is a difference in basic capabilities that this war may have been between the forces, and I am really not the right person to address that. But I think the United States and our European partners have reached a conclusion through this entire process, this decade of the breakdown of the former Yugoslavia, that the United States cannot go too far away from European responsibilities and the Europeans realize that they need our help. So I think we have developed an effective partnership that was borne out in this particular conflict in which we worked very, very closely from the beginning with our European partners on how we could reach an effective political solution. Unfortunately, it required the use of military force. But, again, this was the culmination of 19 different countries focused on the single objective, which is really a remarkable achievement. Mr. Pomeroy. It was a remarkable achievement. Mr. Wayne, do you have a comment? Mr. Wayne. Just to add that I think you are correct in your observations about the remarks that Prime Minister Blair has made, that clearly he and I think several others in Europe (of course, we don't know how many yet) have drawn the conclusion that there has to be a focus on developing defense capability in Europe. And that is one of the lessons that came out of Kosovo: the unity of purpose and the importance of the alliance was one lesson; another one was that there does need to be work on developing the defense capability in Europe. And he certainly has been vigorously pursuing that. Mr. Pomeroy. I hope he is reflective of the alliance. My time is up, but I have got another question. Chairman Gilman. Go ahead. Mr. Pomeroy. Thank you. It relates to housing stock. I represent North Dakota; we know about winter. And it looked to me, especially at the onset of the conflict, that they have a pretty severe winter there. How are we coming in terms of dealing with people who have lost their housing being able to survive a winter, for the hundreds of thousands of impacted families? Mr. Pardew. Well, first of all, this is a very resourceful population, and this whole situation has placed UNHCR under tremendous stress. If you look at what has happened here, first of all, you had the dislocation of 250,000 people inside of Kosovo and spilling over into the borders. Then almost a million people migrated out of the country, and now a million people have migrated back into the country, so the task for UNHCR has been enormous. And while there have been fits and starts, I think we have got to conclude that they have been able to deal with that great tragedy. It is our understanding now, and we have something like 90 NGO's in Kosovo at this point in time, that basic humanitarian requirements are being met: medical, food, and shelter. UNHCR recognizes that they have a limited amount of time, as we do, to get people ready for the winter. But between the population and the self-help program and people sharing their own homes, buildings that have not been destroyed, and materials that are being provided by the international community, we believe right now that basic shelter needs will be met and that we will be able to deal with it. Mr. Pomeroy. Mr. Ambassador, that is music to my ears. Chairman Gilman. Thank you, Mr. Pomeroy. Chairman Gilman. Mr. Bereuter. Mr. Bereuter. Thank you, Mr. Chairman. Ambassador, thank you very much for your testimony. I wanted to call to your attention legislation I introduced on July 30, the Kosovo Burden Sharing Resolution, which was cosponsored by Mr. Lantos and other original cosponsors, Mr. Cox, Mr. Ewing, Mr. Green of Wisconsin, and Mr. Toomey. I had some encouragement from Republican House leadership in preparing this legislation. I held it several weeks, almost a month, while we tried to get more information about the cost of the air war. It still is sketchy, but we provided most of the aircraft. We flew most of the sorties; we provided most of the munitions, by far the majority: logistical planes, about 79 percent. What this resolution does is say that the U.S. should not pay more than 18 percent of the aggregate costs associated with military, air operations, reconstruction of Kosovo, and in other parts of the Southern Balkans. That 18 percent figure came from the President in his personal remarks to the Speaker, but he did not clarify what 18 percent was going to cover. I took the hard-line approach at a beginning of the negotiations and covered air war and so on; and in reality, I think what we spent on air war will be more than 18 percent of totals, but we can begin the negotiations at that point. It is my intention not to let the Administration permit European and other allies pay less than the majority costs for reconstruction in that area. And by majority, I am talking about a supermajority. It is important we don't begin to spread money around in that region. So this will be my effort to make a statement--get other people to support it, and then police the appropriation process hereafter, because Europeans have no history of the United States really coming down and asking them to follow through on promises and to pick up the majority of the costs. The second thing that it does in the way of guidance in the sense of the Congress element is to suggest that Macedonia and Albania deserve high priority for the costs--humanitarian, economic costs that they bore during this period of time in preparation for the air war, during the air war, and subsequent to the air war. I wanted to call that to your attention, gentlemen, and we will see how we progress at this point. But we are watching very carefully to make sure that the President doesn't continue to announce large expenditures without consulting Congress. I do have a question. I hope you can be candid, Ambassador Napper, in particular, with me on this. Is it true that you are having difficulty in the Administration getting approval of appropriations for Macedonia? What is the situation in that respect? Is there one Senator, or one Senate staffer, who is holding up the progress in getting money for Macedonia? If so, what are the cited reasons that you hear? Why are they holding up money for Macedonia when they have borne all of those costs and when they are potentially destabilizable as a result of the Balkans war, a very fragile democracy in its early stages in the first place. Mr. Napper. Mr. Bereuter, thank you very much for your question. I agree with you, we certainly do--in the Administration--Macedonia and Albania deserve priority attention and, in fact, they have received that. In our SEED assistance program, for instance, the original allocation for Macedonia in 1996 was $16 million. That has more than doubled to $32.5 as a result of the supplemental appropriation and other increments that we have been able to bring to the account. In addition, out of the roughly 100 million in ESF (Economic Support Funds) that was appropriated for budget support and balanced payments support, 28, 29 million--22 million of that 100 million went to Macedonia, and then another six that we found in an existing account. So, as you can see, we tried to do everything we can possibly do to assist Macedonia and Albania in these circumstances. We have had dialogue with a number of Members and staff concerning Macedonia. There is at present no impediment to providing the assistance to Macedonia. Whatever questions did exist, and there were some at one point, have been answered so that the assistance is able to flow. There were some questions, frankly, about how the Macedonians and the Macedonia security forces handled the influx of the Kosovar Albanian refugees when they first came into Macedonia. There were some reported instances in which the security forces were not perhaps as welcoming as might have been hoped, but we did work with the Macedonian authorities, we believe we saw a significant improvement. And as I say, we have been able to resolve virtually all of the questions that involve technical assistance and balanced payment assistance. There is one remaining outstanding question concerning foreign military assistance, but by and large all of the assistance to Macedonia is flowing. Mr. Bereuter. Thank you, Mr. Chairman. Chairman Gilman. Thank you, Mr. Bereuter. Chairman Gilman. Mr. Delahunt. Mr. Delahunt. Thank you, Mr. Chairman. Questions have been posed relative to burden sharing, and the disproportionate share in terms of the military action that was undertaken. Clearly there is a growing consensus, within this Committee and in Congress and within the Administration, that the Europeans, our NATO allies, should step up in terms of economic assistance and development at this point. But in the course of the exchange, I think it was you, Mr. Wayne, who talked about Prime Minister Blair in a recognition that they have to increase their burden when it comes to the security, security capacity. But if we are successful, if the United States, our NATO allies are successful in nurturing true democracy in this region, one can't always foresee the future, but I would suggest that a viable dynamic democracy within the region would really, to a substantial degree, obviously obviate the need of the concern about these security issues. Any comment? Again, that is why I would say that a priority at this point has to be examining this question in a regional context and making the kind of investment, whether it be substantial or not, that will save us in the long run. Mr. Wayne. Congressman, if I might take a crack at least at a initial response. We agree fully with you that we need to take a regional view of this situation. That means, of course, sometimes we will act in individual countries, because they have their individual needs. We also agree fully, as you indicated, that the lion's share of the reconstruction and development costs should be provided by the Europeans. And with every European that I have talked to, they agree with that and indeed say that it is their intention, to do so, and that is what they will do. Ambassador Napper can give some specific figures in the technical assistance area, to show that in talking about reconstruction and development, they, indeed, even before the conflict, were providing the lion's share. And they know now that they need to provide more. The European Union is revising its different types of contractual relations to have more trade access available for the countries of the region, particularly for Macedonia, Albania, and Bosnia, where there were different kinds of trade and commericial regimes. They are looking at all of their relations to indeed provide more assistance, to have more trade access, to encourage investment, and this is very important. Indeed, what you said about democracy, supporting democracy, it is vital. We need to do that. Democracy has taken good root in a number of the countries of the region. There are other places clearly where it needs help, and there is Serbia, which is a large hole. We need to work on all of those. And indeed, we can't separate the work on democracy from the work on the economy, from the work on security. We have to pursue all three of those baskets, if I could put it that way, together. Mr. Delahunt. If I may, Mr. Chairman, my time is almost up, just an observation. In any society or in region, there are symbols, I do concur, and really support the Administration's position vis-a-vis aid to Serbia, as long as Milosevic is still in power, because I think he has become such a symbol. I think some of us overestimated his ability to survive. Early on, it was stated that he would never withdraw without the intervention of U.S. ground troops; yet he did, and his efforts to divide the alliance obviously failed. I think it is fascinating to see the demonstrations break out in such short order after the conclusion of the conflict. But I was heartened today to read that an indicted war criminal, a Bosnian Serb general, was arrested. It is important to maintain that course, because I think people in the region are looking toward that end. I think it carries such symbolism in terms of why we were there in the first place, in terms of the moral imperative of saving lives and in being there for the right reasons in terms of defending human rights everywhere. Mr. Wayne. We agree. Chairman Gilman. Thank you, Mr. Delahunt. Chairman Gilman. Mr. Rohrabacher. Mr. Rohrabacher. Gentlemen, when I was a young reporter, I used to ask two questions, and actually I just asked these two questions over and over and over again of whoever I was interviewing. People used to think that I knew a lot more than I knew, because everyone always seemed to be stymied a bit by these two questions. I think I will just ask you fellows the same questions, and I am sorry if you may have already answered them while we were gone for the vote. The two questions I always asked were, how much is it going to cost and who is going to pay for it? So maybe you can tell us specifically how much the Balkan operation has cost us so far? How much will it cost by the time we have reached a conclusion? And just who is going to pay for it? Do we have any specifics for that? I mean, you are here to give us a little insight on these things. Mr. Napper. I would like to try to address the nonmilitary costs. I know you probably are very interested in the military side of it. But that is something that we---- Mr. Rohrabacher. Does the State Department have any overall figure for us? Mr. Napper. If you look at the supplemental appropriation that Congress passed and the President signed for the Kosovo Conflict, that gives you a pretty good thumbnail sketch of what we are intending on doing, and that is roughly just about a little bit more than a billion dollars in terms of nonmilitary costs for the Kosovo conflict, which includes a 120 million in SEED funds, 105 million in economic support funds for a balanced payments assistance to the front line states and investigation of war crimes, and the vast bulk--the remainder of that 1.3 million--is fundamentally humanitarian. Mr. Rohrabacher. The trouble about analyzing a supplemental is that we know that funds have been poured in from other accounts into this specific commitment, because the Administration, you know, saw this as an emergency situation. Mr. Napper. Yes. Mr. Rohrabacher. Would I be wrong in suggesting that after 10 years, we may look back and find that $30 billion have been spent by the United States both in the military as well as the civilian end of this project? Mr. Napper. In my view, that figure is probably far too large, but, you know, it is difficult to sit here and give you an estimate of what the next few years are going to bring. Certainly, there is no plan for a $30 billion commitment over the coming years of that kind. Mr. Rohrabacher. Do I have any other overall idea of estimate? Let me ask, please, the next time we have some type of a briefing on this or some other type of a hearing, that we have a figure, because I think that it is important for the American people to understand the costs. And we all know who is going to pay for it--we are going to pay for it--old Uncle Sam and then all the rest of the taxpayers. One thing that has disturbed me over the years is that ever since World War II, it seems when we have had the upper hand we have been unwillingly to take those final tough steps that will end a situation and correct it. For example, here it is, 10 years later with Saddam Hussein, we are still in Kuwait and we are fighting Saddam Hussein today. My father fought in Korea and 50 years later, one-fourth of the history of our country, we are still occupying Korea. Concerning what we are doing in Kosovo, have we at least decided that Kosovo will have its right to independence and freedom? By the way, I personally believe that the Kosovars and all people should have their right of self-determination. Are we going through all of this cost but still trying to maintain this charade that Kosovo is part of Serbia and thus leaving the door open 10 years from now for the Serbs to do exactly what they just did? Mr. Napper. First of all let me say something about who pays. Again, I can't speak as to the military costs, but I can say that we just had a donor's conference on the immediate humanitarian needs in which the United States pledged roughly one-fourth of those costs. The Administration has been on record over and over and over again that the vast majority of reconstruction cost is a cost that will be borne, in the large part, by the Europeans. The European Union has stepped up to that responsibility and stated that they will take a leadership role and has taken over the reconstruction piece of the U.N. force or the U.N. civil aministration force that is in Kosovo. So the United States will pay particularly in the humanitarian area. Right now, that figure is about 25 percent of the anticipated funding that is going to come in there. We will participate very little in the reconstruction cost. It will largely be a European matter. On the issue of Kosovo, we haven't ruled out independence in the sense that the long-term status of Kosovo has not been decided. It is something that should be decided as the civil society is reconstituted, as people have governments that are put in place, and that just hasn't happened yet. We have a situation over there now in which, first of all, NATO is basically in charge. The U.N. will assume responsibility for civil aministration, and in that process, we will develop local institutions, police, local governance and so forth toward democracy. Once we have a structure in place that can deal with the long-term issue of Kosovo status, it can deal with that. But it is premature now to determine the long- term status of Kosovo. Mr. Rohrabacher. It would probably be better to determine that while we have the upper hand, you might say, I did notice that you were training 33,000 policemen. Mr. Pardew. If I said that I am wrong. Mr. Rohrabacher. What was that, then? Mr. Pardew. It is about 3,000 local police. Mr. Rohrabacher. I was trying to clarify that. Mr. Pardew. We are going to have about 3,100 national police on the interim basis until we can get the police force built. Mr. Rohrabacher. Thank you very much. I do believe, again just for the record, if we have gone through all this and the people of Kosovo have gone through this, the Kosovars do deserve their own independence, which would be the long-term solution. Thank you. Chairman Gilman. Thank you, Mr. Rohrabacher. Chairman Gilman. Ms. Lee. Ms. Lee. Thank you, Mr. Chairman. Let me just follow up on Mr. Rohrabacher's question with regard to the costs. I would like to know when or if we will ever receive these figures, in terms of the costs. In terms of the nonmilitary costs, I would like to know the accounts that this billion is coming out of; because from what I remember during the supplemental appropriation process, we had some numbers in terms of offsets to food stamps and section eight housing and community development block grants. I say that because right now we are facing huge cuts in the VA-HUD budget, and this impacts senior citizens and low-income individuals in terms of housing in their communities and in terms of just their ability to eat. So I would like to know when we receive those costs, if we will know where those costs are coming from. Whether we agreed with the war or not--I certainly did not agree with it--I think it is our obligation to provide the support for the Administration in terms of its rationale to not support reconstruction assistance until Milosevic is out of the picture. But I guess the question I have is, at what point do we evaluate this position and look at what impact it is having or, if it is having no impact on the people of Serbia, regardless of whatever humanitarian assistance that we are contributing. Is there a dropdead point, do we go back and evaluate it? Do we say to Congress, the lack of our participation in reconstruction efforts has impacted the people in this way? Mr. Napper. First, with regard to your first question, the Kosovo supplemental was passed under emergency designation. It was not offset, so that there is not a tradeoff between the moneys that were included in the Kosovo supplemental and the other program accounts that you are discussing. With regard to the people of Serbia, we have made it clear from the beginning that we don't have anything against the people of Serbia. What we have as a problem is their leadership at this point. We have not ruled out the possibility of humanitarian assistance to the people of Serbia; and, indeed, we have continued to contribute to international organizations on the ground in Serbia that are providing that kind of humanitarian assistance. Here I am talking about food and medicine--that kind of thing. But we do draw the line at reconstruction and the President has made that very clear this is our position. And I don't anticipate that changing until there is a change in the leadership. Ms. Lee. I understand that. And I agree, but I am just saying at what point? For instance, if people need bridges to go to work and can't go to their jobs because they can't get there and there is no reconstruction assistance in the mix, do we ever evaluate what that means in terms of the people? I fully agree with what you are doing--I am just saying how do we know its impacts or will we ever know, or does it really matter until Milosevic is out of the picture? Mr. Pardew. This is a tough question, because some of the restrictions--the sanctions regime, and we hold a complete sanctions regime still in place, new bridges and those kinds of questions do have an impact on the population. But the basic rule we are applying at this point is that anything which strengthens the regime is off limits. We are willing to contribute to international organizations that would meet the basic needs of the population, food, shelter, medicine, those kinds of things; but if it goes into accounts which then can go to Milosevic or his cronies or strengthen the regime, even though it may have some impact on the population, we are, at this point, unwillingly to do it. And, you know, we can assess that. Ms. Lee. Are we assessing the impact or will we? Mr. Pardew. What we are trying to do is work with the democratic opposition. As you know, the President has sent 10 million this year. We are assessing the needs for the future on how we can improve the potential to change the regime here in a way that would be more democratic. I think that is the real solution here. And then the restrictions which are in place at this point in time would be reconsidered. Ms. Lee. Thank you, Mr. Chairman. Chairman Gilman. Thank you, Ms. Lee. Chairman Gilman. Mr. Chabot. Mr. Chabot. Thank you, Mr. Chairman. I just have two questions. How much is it going to cost and who is going to pay for it? No, I guess that has already been asked. Seriously, relative to Bosnia, in particular, as you all remember, this House was led to believe that our troops would be there for one year and it was going to cost somewhere in the range of $2 billion or so. It has gone up now, I understand, to eight or nine or $10 billion, and we have been there for four years now with no end in sight. I was just wondering what the latest thinking is, and if you have already covered this in your testimony, I apologize. We have about three Committee hearings that we are kind of bouncing around on--most of the Members. What is the best thinking at this point in time concerning how long our troops are going to be in Bosnia? Mr. Pardew. Well, I think that the lesson was learned in the original projection on giving a specific timeline, that was probably a mistake. Having to go back on that, reassessment has been done in which we are looking for an end state as our way out, not an end date. So there is no willingness at this point to put any kind of timeline on this. I would simply point out that when we went into Bosnia, there were 60,000 U.S. troops. We have set benchmarks on things that need to be done in order to provide long-term stability, and that is our interest and objective here. As the situation there has improved, we have been able to reduce the force commitment now down to about half, less than half of what we had in there to start with, so the troop contribution or troop levels have gone way down. As other areas are improving, we can see the international community cutting back as well. But there is a set of clear benchmarks that we are looking at, the President has set 10 of those, and our presence there will be measured against the benchmarks seeking to achieve long-term stability. Mr. Chabot. OK. I appreciate your response. But in essence, you have said that, yeah, it was one year and that was probably a mistake to tell us that. It has now been four and there is no end in sight at this point. Relative to our commitment in Kosovo, I know that there was no commitment, and I would assume that the Administration would not really find it wise to even venture a guess as to how long the troops might be there either. Is that correct? Mr. Pardew. Again, the presence there is based on the goals of the Security Council Resolution 1244, which gives a powerful mandate to the civil Administration and to the military presence headed by NATO. As the tasks that are identified in the Security Counsel Resolution and the objectives are met, those numbers--that commitment should be reduced. So we are hopeful Kosovo is a significantly different situation than we had in Bosnia. We are hopeful that the presence there can be reduced more rapidly. But, again, Congressman, you cannot put a specific time or date on that. Mr. Chabot. OK. Thank you very much. Chairman Gilman. Thank you, Mr. Chabot. Chairman Gilman. Dr. Cooksey. Mr. Cooksey. Thank you, and thank you gentlemen for being here. You know, I was over there in May and visited some of the camps. My question is, were the camps kept open? Because it seems that the peace is failing, and you have just got a different group of refugees. One group has now gone into the country and another group is coming out. So are you keeping the camps intact to take care of those refugees--the new group, the Serbs that are coming out? There is an infrastructure there now, or has it all been dismantled? Mr. Pardew. It is considerably different, Congressman. First of all, the numbers are vastly different. Mr. Cooksey. Ten percent, I would assume. Mr. Pardew. The number of Serb refugees, I think, is somewhere on the order of less than 200,000, whereas in Kosovo, we had over a million refugees and displaced persons. Some Serb refugees are going to Macedonia where camps were established; they are not going, for obvious reasons, to Albania. There were large camps, so there is no application to Albania. It is my understanding that most of them, those who have gone to Macedonia are simply going back, going to Serbia. Our goal is to have a multicultural society in Kosovo. We are extremely concerned about the departure of the Serbs; and we are concerned about attacks on the Serbs, just as we were concerned about the terrible tragedies that occurred to the Kosovar Albanians. Mr. Cooksey. I would hope you are because they are people, too. You know, another question, and I don't know who should answer this, because I assume none of you have a military background, but is it true that the NATO commander who is an American general requested the British to intercede as the Russians were heading toward the airport at Pristina? Was that command given and is it true that General Jackson failed to respond to that command? Mr. Pardew. Congressman, I don't know the answer to that. Mr. Cooksey. It is a question that should be answered to find out how strong NATO is and what the command structure is. I know it is probably not relevant to people that have no military background, but... Mr. Pardew. I have that, it is somewhat dated. But I honestly can't give you the factual answers to that question, because I simply don't know the facts. Mr. Cooksey. Tell me about Thaci. Mr. Wayne. Thaci. Mr. Cooksey. Thaci, Thaci, short A. Does he have the potential to be a reasonable leader of Kosovo? Mr. Pardew. It remains to be seen. He stepped forward at Rambouillet. He clearly has leadership, natural leadership ability. He has sort of come up out of the ranks of the KLA. He has represented them. Mr. Cooksey. What was his background? What did he do before? Mr. Pardew. He was in the KLA, in the military--I don't know. Mr. Cooksey. Educational background, professional business? Mr. Pardew. I can get you that. Mr. Cooksey. I would like to know, I would be interested in seeing that. Mr. Pardew. All right. Mr. Cooksey. You know the thing that has created a problem for victims on both sides of the issue, both sides of the front is that--and this is a general statement with its potential shortcomings--is in this day and time, if you look across the full panorama, we have had a lot of leaders in this country and Canada and Europe and NATO and Yugoslavia that are narcissistic, that are people who are skilled communicators, take advantage of television, and they don't always do what is best for their people. And Milosevic, if you really look into his background, fits into that mode. He did a lot of what is good for them at the time, what made them feel good at the time; Milosevic actually lived in this country--he worked on Wall Street, as you know, and is well educated. He is a lawyer, whether that is such a good education, but anyway it is an education. A lot of people have fallen victim to these flawed personalities with all the frailties that go with them. I hope that we get some real leaders like Churchill and Thatcher, not to mention any of our great leaders. But are there any of those on the forefront in the Balkans? Mr. Pardew. I think there are people with that kind of potential, but they haven't appeared yet. Mr. Cooksey. Thank you. Would you like to comment? Mr. Wayne. I was just going to say, of course, this is one of the reasons why we have tried to support free media development in Serbia and the former Yugoslavia and elsewhere-- because it is so important to give news access to people, so that there is not only one media outlet that can be dominated by a regime or a magnetic personality. Chairman Gilman. Thank you, Dr. Cooksey. Chairman Gilman. Mr. Burr. Mr. Burr of North Carolina. Thank you, Mr. Chairman. I have to make a statement at the beginning. Ever since the issue of our policy there has come up, I envision those who deal with policy, with this big kaleidoscope, and every time they look in it they see the pretty colors. It is always the same, unfortunately, nothing outside of the kaleidoscope ever affects the inside of what you see. I have a real question as to whether we are being realistic in what can be achieved, or whether our goals are limited to what we see in that kaleidoscope when I hear the perfectly multicultural area that we would like to have. I won't get into the realities of whether we can get there or what the cost is, both financial or human. Let me just ask, and I will address it to anybody who would like to answer, did Kosovo come up in the Dayton talks? Mr. Pardew. Not in a significant way. I can speak of that because I was there. Mr. Burr of North Carolina. Why don't you speak of it ? Mr. Pardew. OK. There may have been some discussions of Kosovo, but it was not a major objective in the Dayton talks, because the Dayton talks were focused on the tragedy in Bosnia that had caused two and a half million refugees and 250,000 dead. Kosovo was, at that time, relatively quiet. In the meantime, Bosnia was on fire and it was the requirement and the belief at that time that what had to be focused on was the immediate fire that needed to be put out, and that if we got into larger issues at that point in time, more distant issues, that it would detract from our ability to bring the Bosnian conflict to a close. Mr. Burr of North Carolina. Dayton was not about stability in Bosnia? Mr. Pardew. Dayton absolutely was, absolutely about stability; but it was focused on Bosnia, and we did not feel as though we could weaken our effort on Bosnia by taking on any number of other issues. I mean, there is also Montenegro. There is Vojvodina. There are any number of issues. Mr. Burr of North Carolina. When did this dissolution of Yugoslavia start? Mr. Pardew. Eighty--well, you could probably trace it back to Tito's death, but it started to come apart in---- Mr. Burr of North Carolina. Certainly in the late eighties, would you agree? Mr. Pardew. Late eighties. Whenever Slovenia---- Mr. Wayne. 1992? Mr. Pardew. No, it actually--I believe it started in--. Mr. Burr of North Carolina. So we had concerns about not only the stability of Bosnia at the time of the conflict, but we knew then that we had a much bigger stability question, didn't we? Mr. Pardew. Well, when Yugoslavia started to come apart, it, of course, raised stability concerns, that is right. Mr. Burr of North Carolina. Did anybody at Dayton say, gosh, we don't have to address Kosovo because that won't be a problem? Mr. Pardew. No. Mr. Burr of North Carolina. In hindsight, do you think we should have addressed Kosovo? Mr. Pardew. No. I think it took all the energy that we could muster to end the war in Bosnia at Dayton. I personally believe that had we decided to take on other issues at that time, it would--it may have caused that very difficult negotiation to fail. Mr. Burr of North Carolina. The Administration officials have said they prefer Montenegro to remain with a restructured Yugoslavia. Can a restructured Yugoslavia work? Mr. Pardew. With proper leadership, it can. Mr. Burr of North Carolina. Describe leadership. Is that-- -- Mr. Pardew. Something different than what we have right now. I don't want to be glib, Congressman. It is very difficult to deal with the impulses of independence in Kosovo or Montenegro or perhaps other places with Slobodan Milosevic leading the government in Belgrade, because of the repressive measures and the anti-democratic policies of that government. I believe that over time, with the change of leadership, with the hope of economic development and democracy, that the populations there can look at their situation and make more rational judgments than perhaps we would make at this point in time with the terrible leadership that they have in Belgrade. That is what I believe. Chairman Gilman. The gentleman's time has expired. Thank you, Mr. Burr. Chairman Gilman. Mr. Bereuter. Mr. Bereuter. Thank you, Mr. Chairman. I know we are anxious to go, but one question for the good of the world order. I guess I would address this to you, Mr. Wayne. The Montenegrins indicate they are going to try to conduct negotiation with Serbia about new constitutional arrangements for a looser Federal system. If those negotiations fail--and as they want the deadline in September, it seems to be likely--and they take unilateral action to change their status or role within the federation, the Federal Republic, is the U.S. prepared for an outbreak of violence in Montenegro? What specific steps have the U.S. and NATO taken to prepare for humanitarian assistance and for military intervention in Montenegro? Why is it, in your judgment, that NATO and the U.N. have not accepted the Montenegrins' offer to base their operations for Kosovo in Montenegro in order to establish a U.N. and a NATO presence in Montenegro, in light of what seems to be about to happen in September? Mr. Wayne. Well, let me make a couple of initial comments, Congressman, and then ask Ambassador Pardew to continue on. One is that we have worked very hard, indeed, to support the democratically elected regime in Montenegro as have our friends and allies in Europe. As you may know, the prime minister was present in Sarajevo at the Stability Pact summit, and the President met with him in Sarajevo. He has visited and been received in a wide range of European capitals, and I think he is even in Moscow today--and yesterday--being received at a very high level. As you also know, NATO issued a policy statement on Montenegro very clearly saying that any move by Milosevic to undermine that democratically elected government would--to get it right--be considered provocative and would be dealt with appropriately. Of course--excuse me, I meant President Djukanovic, not the prime minister, earlier. So we have all tried to send a very clear message of support and to make clear that if there were any moves against that government it would have very, very serious consequences. Similarly, we have acted concretely to support that government financially and with technical assistance; and Ambassador Napper can say more about that. Right now, we certainly do support the democratic leadership in Montenegro, which still prefers to seek a modus vivendi within the FRY. So we are supportive of their efforts to have these talks. I think we, you know, will continue to express our support for their efforts to that regard. As far as looking ahead, I guess I would say, I don't think right now it would be productive to address the hypothetical that you posed. But let me ask Ambassador Pardew if he wants to comment. Mr. Pardew. Well, just to reinforce the point that NATO has been very firm on Montenegro; in fact, in their summit statement in April they said we affirm our strong support for democratically elected government in Montenegro. Any move by Belgrade to undermine the government of Djukanovic will be met with grave consequences. So NATO is on record as taking Montenegro very seriously. We have supported and will continue to support Djukanovic as the democratically elected head of that government, and we want to work with him as a model for change in Serbia. As to whether we have NATO there or not, that is a difficult question. We don't want to put NATO in an awkward position relative to the FRY and so forth. We are looking at that, just as we are looking at ways that we can remove some of the sanctions restrictions on Montenegro without benefiting Belgrade. These are important points. They are delicate, however, in terms of putting NATO or passing NATO through Montenegro, but we are looking at it. Mr. Bereuter. Gentlemen, my leading question is your Capitol Hill warning to be prepared to avert or fight a new Balkan conflict sometime after December, at the wrong time of the year. Thank you, Mr. Chairman. Chairman Gilman. Thank you, Mr. Bereuter. Again, we want to thank our panelists for being with us. We regret the interruptions that delayed your testimony. Without objection, the Chair will submit questions in writing on behalf of Members of the Committee concerning issues reviewed in this hearing for an expeditious response in writing by the Department of State, and there will be three additional days for Members to submit additional material for the record. Once again, our thanks go to our official witnesses for their testimony today. We will now proceed with our second panel. Mr. Bereuter.--[Presiding.] As the next panel comes forward, I would like to introduce them and say a word or two about them. First, Mr. Janusz Bugajski is Director of the East European Studies at the Center for Strategic and International Studies here in Washington, D.C. He has previously worked with Radio Free Europe in Munich and has served as a consultant to the U.S. Agency for International Development, the Defense Department, the Rand Corporation, BBC Television, and other organizations. He has lectured at several universities and institutes and has published numerous books and articles on East Europe. Professor Janine Wedel is an Associate Research Professor at George Washington University and a Research Fellow at the University's Institute of European Russian and Eurasian studies. She has received a number of awards from organizations, such as the National Science Foundation, the MacArthur Foundation, the Woodrow Wilson International Center, the National Council for Eurasian and East European Research. She is a three-time Fulbright fellow. Her latest book, ``Collision and Collusion: The Strange Case of Western Aid to Eastern Europe,'' was published just last year. Our final witness of the three, Dr. Daniel Serwer, is Director of the Balkans Initiative at the United States Institute for Peace here in the Nation's Capital. Dr. Serwer has received a Ph.D. from Princeton University, served at the Department of State as Deputy Chief of Mission and Charge'd'affairs at the Embassy in Rome, as a United States special envoy and coordinator for the Bosnian Federation-- director of European and Canadian Analysis, and finally as Minister Counselor at the Department of the State. At the Institute of Peace, he has co-authored a number of studies on the Balkans States and worked on regional security issues in the Balkans. Mr. Bereuter. Panelists, we are very pleased to have you here to share your wisdom with us on the important subject of the hearings today. I just would note that all of your statements will be made a part of the record and you may summarize your written statements. Mr. Bugajski, we will start with you and welcome. STATEMENT OF MR. JANUSZ BUGAJSKI, DIRECTOR, EAST EUROPEAN STUDIES, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES Mr. Bugajski. Thank you very much and good afternoon, Mr. Chairman. Thank you for including me in this important hearing. I think it is very important for Southeast Europe and I hope it will enhance the U.S. agenda at this very critical period in Balkan history. I would like just to summarize my written statement in a few comments. I believe that the post-war commitment of NATO, the United Nations, and the EU to Balkan reconstruction does offer a unique opportunity to build stable institutions and market economies throughout Southeast Europe. However, to ensure success, I think consistent progress must be made in six key areas. Otherwise, resources will be squandered, and the region will continue to drift toward isolation from Europe. These are the six that I would like to outline. First, political stability. Long-term governmental stability will remain an essential prerequisite for pursuing any kind of economic and institutional reforms. Each Balkan government, I think, needs to ensure programmatic continuity between different Administrations so that the reform process does not veer between periods of progress and reversal. Hence, I would say all Balkan countries require a cross-party commitment to the goals of economic transformation and institutional reform, much as we have seen in Central Europe in the past 10 years. Second, institution building. Successful political stabilization requires the consolidation of authoritative democratic institutions based on firm constitutional principles. The organs of government need to have public confidence and the commitment of all major political players. In this context, extremist parties advocating authoritarian solutions must be marginalized so that they do not undermine the Nation's party politic. Third, civic society development. Each Balkan country must develop a more effective alternative media and a range of citizens' interest groups that will significantly enhance the democratization process. In the area of minority rights, each Balkan state must pursue policies that comply with international obligations. Furthermore, development of a multifaceted civil society will undercut the focus on exclusive ethnic questions that undermine democratic development. Fourth, economic progress. A priority for each Balkan government is the consolidation of a credible market reform program. All too often in the past, vested interest groups have stalled this process to their advantage or politicians have compromised on many essential market components, for example, by maintaining large scale state subsidies to unprofitable industries or failing to ensure transparency in privatization. A serious and far-reaching reform program cannot be held hostage by any political party or economic lobby. Fifth, organized crime fighting. Public security organs must be empowered to deal with organized crime and corruption. Both an internal but also an international strategy must be pursued by each Balkan state working in tandem with neighbors. The pervasiveness of politically connected criminality threatens to obstruct the region's reform process. It consolidates the control of special interest groups, encourages radicalism, dissipates public confidence in the transformation process and jeopardizes economic progress. And sixth, regional cooperation. Regional cooperation, I think, can be buttressed through a range of institutions and a whole array of arrangements: governmental, military, parliamentary, political party, local government, as well as the NGO sector. Economic transformation must also be a region- wide priority, as the failure of economic reform will directly challenge all nearby states. More emphasis also needs to be placed on building economic networks that enhance the reform process in each country. In sum, I would say the Balkan countries must take a much more active role in promoting regional stability and regional development and not focus only on their domestic concerns. In conclusion, I would just like to say, reconstruction not only provides the opportunity for material development, economic development, but also for representative democracy. The commitment to reconstruct must be matched by a commitment to reform. The ultimate objective for all these states must be inclusion and integration in the major European and transatlantic institutions based on solid democratic and capitalist foundations, and I believe the U.S. can clearly assist in this process. Thank you. Mr. Bereuter. Thank you, Mr. Bugajski. Mr. Bereuter. We would now like to hear from Dr. Wedel. You may proceed as you wish. Your entire statement is a part of the record. STATEMENT OF PROFESSOR JANINE WEDEL, ASSOCIATE RESEARCH PROFESSOR, GEORGE WASHINGTON UNIVERSITY Ms. Wedel. Thank you very much for the opportunity to speak with you today. My comments today are based on an extensive study of U.S. assistance to Central and Eastern Europe, Russia and Ukraine over the past 10 years. I am not an expert on the Balkans, but my research on U.S. assistance programs has given me an acute awareness of the promises and pitfalls of aid to Eastern Europe, many of which are discussed in my recent book, ``Collision and Collusion: The Strange Case of Western Aid to Eastern Europe,'' and in previous testimony before this Committee and others. The following six cautionary lessons arise from my research: First, we need to constantly remind ourselves that aid is by no means just a technical matter. It is not just about getting the economic prescriptions right. Aid is a complex task of societal, political and social challenges that must be taken into account if it is to have the desired stated goals. It must be well conceived, well planned and implemented systematically, in accordance with those challenges. It is important that the beneficiaries of the aid are not just western consulting firms looking for fat contracts but also the people and the communities that we want to help. It would be elusive to think that our aid programs alone could build democracies and market economies. On the other hand, poorly conceived and administered aid certainly can do damage, both to the region and to the image of the United States there. As Joseph Stiglitz, chief economist at the World Bank, once suggested, we should adopt, ``a greater degree of humility . . . and acknowledgement of the fact that we do not have all of the answers.'' Second, we should avoid the so-called ``Marriott Brigade'' syndrome. The Marriott Brigade was a term the Polish press coined in 1990-1991 for the short-term ``fly in, fly out'' consultants who were paid to deliver technical assistance to Eastern European governments and officials. The consultants stayed at Warsaw's pricey Marriott and hurtled among five-star hotels across the region, collecting data and advising on economic and political reform. Recipient officials, many of whom were new at their jobs, welcomed the consultants at first but after hundreds of fact- finding and first meetings with an endless array of consultants from donor organizations and international financial institutions, many officials were disillusioned and frustrated. We must avoid that situation in the current effort. Bringing in team after team of high-priced consultants, many of whom will never return, creates a burden for local officials and stirs resentments against the consultants and the donors. It is important not to duplicate fact-finding and to keep ``first visits'' to a minimum. As we have seen in Eastern Europe, local perceptions of aid on the part of officials, politicians, and citizens matter and sometimes even shape aid outcomes. Third, it is crucial to carefully and prudently select our prospective partners and representatives. We must be careful not to play favorites among competing local interests and beneficiaries. The record of U.S. aid to Russia in particular shows that selecting specific groups or individuals as the recipients of uncritical support both corrupts our favorites and delegitimizes them in the eyes of their fellow citizens. Given the discretion that political functionaries in the region have to appropriate large portions of state resources and budget to themselves and to their cronies and the considerable corruption on all sides, there is an ever-present danger of diversion of foreign aid. We must also be aware of potential collusion among consultants and local elites toward that end. As we have learned, or should have learned in Russia, putting aid in the hands of just one political-economic group or clan creates opportunities for the misappropriation of moneys to private and/or political purposes and very quickly undermines donor efforts at democracy building. Further, experience shows that it is simply wrong to think that institutions can be built by supporting specific individuals instead of helping to facilitate processes and the rule of law. Many reforms advocated by the international aid community, including privatization and economic restructuring, depend on changes in law, public Administration and mindsets and require working with the full spectrum of legislative and market participants, not just one group or clan. Fourth, we should help to build administrative and legal structures at the level of cities, regions, and towns. In general, the lower the administrative level of our efforts, the better. Any donor efforts must depend on not just speaking with politicians at the top but on working with an array of local people and communities. U.S. officials and advisors need to establish contacts with a wide cross-section of the regional and local leadership--politicians, social and political activists, and community workers. For example, some aid-funded programs to develop the economy from the bottom up have been useful and have created goodwill. Fifth, we should be clear-eyed about the real potential of the so-called ``independent sector'' and nongovernmental organizations or NGO's. Donors often invest high hopes in the ability of NGO's to build democracy. They often assume that NGO's are similar to their western counterparts, despite the very different conditions under which they developed and operate. But in Eastern Europe, the officials, the individuals and groups charged by the west with public outreach--often the most vocal local players--were not always equipped for that role. At least in the early years of the aid effort, NGO's often distributed western perks to themselves and their peers on the basis of favoritism rather than merit. Here again, there can be no substitute for donor knowledge of local politics, conditions, and culture. The challenge for the donors is in enlisting the expertise of people sufficiently informed, intuitive, and committed to aid efforts in the new environment and in designing assistance to foster those efforts. Mr. Bereuter. Dr. Wedel, I am sorry I am going to have to interrupt you because I have just a couple of minutes to get to the vote. I know we haven't come to your last concluding remarks and we will pick that up when we come back. One of my colleagues may take the Chair in five minutes or so. If not, we will be back at it in about ten. So at this point, hold your thought for the final conclusion, and the Committee stands in recess. [Recess.] Mr. Cooksey.--[Presiding.] Professor Wedel, if you would proceed, we are passing the baton. Ms. Wedel. Thank you. I won't reiterate my first five points. My sixth and final point is that the United States should embark on a broad-based policy to encourage governance and the rule of law. To foster reform, I have learned from my study in Eastern Europe that donors need to work with a broad base of recipients and support structures that all relevant parties can participate in and effectively own, not just one political group or clan or faction. This is, admittedly, not an easy task. The major challenge is how to help build bridges in a conflicted environment with historical distrust and many competing groups and very few cross-cutting ties among them. Although by no means easy, the task of aid workers is precisely to build contacts and to work with all relevant groups toward the creation of transparent, nonexclusive institutions and against the concentration of influence and aid in just a few hands. Thank you very much. Mr. Cooksey. Just before we move to the next witness, you are an anthropologist by education, are you not? Ms. Wedel. I am. Mr. Cooksey. In ten words or less, what do you think of the prospects of achieving this last, this sixth goal, about the broad-based policies and about the aid workers being able to accomplish it, viewed in light of the history that has occurred in this area? Ms. Wedel. I began my statement by saying that I am not an expert on the Balkans, but my experience in looking at aid programs in Central Europe, Russia and Ukraine is that there are competing political, economic, financial groups at the very local level. Russia by the way, is a very difficult environment to work in even though the historical animosities aren't nearly as much at the forefront and the country has not been wrecked by war as have been the Balkans. The task is to begin to create incentives for diverse groups to work with each other. It is critical not to play favorites by giving one group aid resources over others--that is a very destructive aid policy. My experience is that can be done. It is not easy to do. It requires a lot of local knowledge, but money can provide an incentive, and if you find experts who know the local situation, they can help put together programs that will provide incentives for people to do reasonable projects. It can be done but it is not easy. It requires a lot of local knowledge. Mr. Cooksey. And this gets back to your third point about prudent selection of the partners that you would be doing this with? Ms. Wedel. Absolutely. Mr. Cooksey. What model do you think exists for this having been done successfully? Where in Europe or any other part of the world? Can you think of a particular place? Ms. Wedel. Yes. I would point to several kinds of programs. One that I looked at very closely was a program that was in part sponsored by the Congressional Research Services and some of the congressional Committees, and that operated effectively in Poland and, I believe, in some countries further east. That program was to build an institution to provide information and infrastructural support to the Polish Parliament--to everybody in the parliaments. At first, in 1990, 1991, 1992, this was an absolutely revolutionary idea. ``You mean you are going to work with those guys, not just us? '' That was a revolutionary idea. But eventually people saw that it made sense. They saw that independent information, that an infrastructure, a system could be built that everyone could use; that it wasn't just about politics--just for me and my group--but that the benefit would go to all groups. We eventually saw in Poland the value of having such an independent institution modeled after the Congressional Research Services, and aid from the United States played a major role in helping to create that. As I said, it was really a different concept at the beginning because people were not interested and certainly not accustomed to sharing information with a different political- economic group. It was a foreign idea, but it could be done if you had the right people on the ground who understood the problems and had the right resources. Mr. Cooksey. Can you come up with another example? Because really Poland is a rather homogenous group with one religion and they have done very well there, but the Polish people have a lot more structure than anyone in the Balkans, it seems. Ms. Wedel. Well, that is what it may look like from the outside, but, in fact, there were many groups that were competing on the ground for resources. And when you come in with foreign aid, quickly you find that you have a lot of competitors for that money. I think in that respect, the Balkans will be very similar. The animosities may be longer lasting, deeper. Mr. Cooksey. From an economic standpoint? Ms. Wedel. Sorry? Mr. Cooksey. From an economic standpoint? From the fact that they are all looking for this aid, this economic aid, and you think they can overcome their ethnic, religious, racial diversity then? Ms. Wedel. As I stated in my fourth point, I think that it is very important to emphasize local administration and legal structure and to help to build those infrastructures. Without those infrastructures in place, there is probably not much hope of overcoming those animosities. The only choice we have is to help develop those infrastructures. That is the only choice we have. If we come in and say we are going to support this group or another, we are, at the outset, doomed to failure. Mr. Cooksey. Thank you. The Chairman is back. Mr. Bereuter.--[Presiding.] Dr. Cooksey, thank you for filling in; and, Dr. Wedel, for concluding your testimony. We would like to go back, though, to hear from Dr. Serwer to make his presentation. Your entire statement will be made a part of the record. You may proceed as you wish, and then we will open it up for questions for all three of you. STATEMENT OF DANIEL SERWER, DIRECTOR, BALKANS INITIATIVE, UNITED STATES INSTITUTE FOR PEACE Dr. Serwer. Thank you, Mr. Chairman. I would like to start by thanking Mr. Smith for his kind opening remarks about previous testimony before the Helsinki Commission. My name is Daniel Serwer. I direct the Balkans initiative at the U.S. Institute of Peace, which takes no positions on policy issues. The views I express here are my own. But the Institute is well-known for its efforts to promote democracy in Serbia, reconciliation in Bosnia and Herzegovina, and a regional approach to the Balkans, one that emphasizes preventive diplomacy and peaceful conflict resolution. The main U.S. Interest in the Balkans is stability. Instability there cannot be ignored, because of its effect on our European allies and on American public opinion. There are no vital resources at risk. Transportation routes through and near the Balkans are not critical to the United States and no Balkan country threatens U.S. or Allied territory. The United States has nevertheless found itself leading the NATO alliance twice into air wars in the Balkans, followed by expensive ground interventions. Why? What we have seen in Bosnia and in Kosovo is the failure of preventive diplomacy. By not undertaking early and relatively cheap efforts to prevent conflict, we have been forced to intervene after conflict has begun at far greater cost. The exception proves the rule: in Macedonia, early deployment of a small U.N. peacekeeping force and an energetic mission from the Organization for Security and Cooperation in Europe has so far allowed a healthy democracy to develop in that ethnically divided country, preventing a conflict that many thought inevitable. Are there other predictable conflicts that could break out in the Balkans? Yes, is my answer. Are we and our allies doing what is necessary to prevent them? ``No.'' There are a number of laudable efforts under way, but we need to be doing more. The main threat to Balkans stability today is the same as 10 years ago: The Milosevic regime in Belgrade, which has used conflict against non-Serbs as a means of staying in power. Milosevic will strike again, perhaps in Montenegro or in Sandjak, an area almost evenly divided between Muslim and Orthodox Slavs, or in Vojvodina, where there are Hungarian and Croat minorities. In each of these areas, the international community should be undertaking preventive efforts aimed at promoting inter-communal understanding and ensuring that Belgrade cannot exploit ethnic strife. The regime may also strike next against discontented Serbs, who are today the most serious threat to Milosevic's hold on power. Courageous people have been demonstrating against the regime throughout Serbia since the end of the war, but until last week U.S. assistance for democratization there was frozen. There is still an urgent, immediate need for small amounts of money to support those seeking democratic change in Serbia. Friday in Sarajevo, the President announced a $10 million program for Serbian democratization, doubling the pre-war amount. This is a step in the right direction, but still short of the resources the Institute's Balkans working group has recommended and far less than the amount Senator Helms has advocated. The President's program is a good first step, but a major increase will be needed next fiscal year. Mr. Chairman, conditions in Serbia do not favor the development of democracy. Poverty, disillusion, and resentment could create a volatile situation this winter. I believe it is important for the West to provide humanitarian assistance to Serbs and even to repair essential humanitarian infrastructure, provided the resources and credit cannot be diverted to the Milosevic regime. This would mean providing assistance through opposition-controlled municipalities, nongovernmental organizations, and the Church. At this point, Mr. Chairman, I would like to submit for the record an institute paper called Moving Serbia Toward Democracy, which includes a number of ideas along these lines. Mr. Bereuter. Without objection, that will be the order. [The information referred to appears in the appendix.] Dr. Serwer. Thank you. We should also be supporting fragile democracies in Albania and Macedonia that could collapse under pressure of their own internal problems. The main issue in Albania is security. A small NATO presence could go a long way toward helping Albania buildup its own security forces. I have been informed this morning, Mr. Chairman, that the North Atlantic Council on Friday has approved the continuation of a small NATO force in Albania. In Macedonia, the issues are both economic and inter- ethnic. Small resources invested now could prevent future interventions a thousand times more costly. Bosnia and Kosovo will, of course, continue to attract the bulk of U.S. and Allied resources. Failure of either intervention would not only destabilize the Balkans but also create big problems elsewhere. But in the rush to intervene, we have all too often failed to exploit indigenous capacities. This is especially damaging in Kosovo, where before the war an extensive civil society existed. Indigenous Kosovar institutions should be empowered rather than swamped. In Bosnia, the missing ingredient is reconciliation, which is impossible so long as indicted war criminals are at large and their associates occupy positions of power. NATO should arrest Radovan Karadzic and any other indictees still at large in Bosnia and Herzegovina. It will then be possible to mount a serious effort to enable people who want to do so to return to their homes. No less important is the right of Serbs to return home, especially in Croatia and in Kosovo. Neither should enjoy the full benefits the United States and its allies have to offer until they are prepared to establish a rule of law that protects all people, as well as the open media and transparent election processes required in a democracy. Mr. Chairman, the President went to Sarajevo last week to launch a Stability Pact that should give a sense of direction and commitment to all allies and to the democracies in the region. That pact must now fill its political, economic, and security baskets. Empty promises will not do the trick. It is especially important that the European Union accelerate its opening toward the Balkans, forming a customs union and encouraging monetary stabilization through the use of the Euro. Europe, because of its proximity, is vulnerable to Balkans instability and should bear most of the burden of bringing peace and prosperity to the region. But without U.S. Commitment and leadership, the task will not get done. As we enter the 21st Century, the Balkans must not be allowed to generate the kinds of conflict and instability that have marred their history in the 20th. Thank you, Mr. Chairman. Mr. Bereuter. Thank you very much, Dr. Serwer. Mr. Bereuter. I would like to begin with a few questions. I will turn to Mr. Cooksey then. Mr. Bugajski, you talk about the institutions of the civil society as a part of your statement. I am wondering if you would tell me what your thoughts are about us overcoming the ethnic/religious hatreds that have existed in so many parts of Yugoslavia and have been reignited in Bosnia, in Kosovo. Is it possible, in the shorter term for the next generation or two, for these people who have seen atrocities committed against each other, renewing memories of the atrocities committed in World War II by one group against another and in some cases by both sides, is it possible for these people to live together and to begin to restore in the short term the elements of a civil society? Mr. Bugajski. Thank you. Well, let's put it this way: Inter-ethnic reconciliation is a long-term process, but I think very concrete steps in that direction can be made; first of all, by the ouster or replacement of the very political forces that have promoted ethnic division, ethnic conflict. Ethnic conflict was not inevitable in the Balkans, just as it isn't anywhere in Europe. It was deliberately promoted by communist politicians in order to stay in power. Second, I think justice needs to seem to be done. That is why I completely agree that war criminals such as Karadzic, Mladic, as well as Milosevic and his people need to be arrested, need to be tried. Justice needs to be shown to be done as well as being done. Third, I do think there needs to be much more work at a local level. I think this has been part of the problem in Bosnia, why refugees haven't returned, because some of the nationalists who promoted the war are still in power. They still control the local economy; they control the local political system. So I think a lot more work needs to be done at the local level to build the very institutions that can promote at least ethnic coexistence, if not ethnic harmony, but it will be a long-term process. Mr. Bereuter. Thank you. Mr. Bereuter. Professor Wedel, I was very pleased to hear some of your categorization of the mistakes that had taken place in our assistance programs and other international assistance programs for eastern and parts of Central Europe. Not to belittle your research, but some of them seem too self- evident and predictable, but I like the way that you apparently have categorized them. I want to read your book. The Marriott Brigade syndrome, for example, caught my attention. It seemed to me, from the beginning, that there was kind of an executive branch pork barrel that took place with incestuous relationships between people in government: in AID, above AID in State, with the people that they knew and had worked with in other institutions here and in other kinds of elite educational institutions, with people in the beltway bandit organizations today. Just an incredible amount of money spent, as you said, making first-time visits all the time with great resentment. We knew that wouldn't work. We knew that was a waste of resources. We knew it wasn't the best use of resources in any case, but how do we keep people who make those decisions from engaging in this kind of pork barrel activity? That is really what it is. Not by the legislative branch but by the executive branch. There was very little earmarking of money for particular programs or institutions by Congress in this time that went by, but that was not the case in the executive branch. How do we avoid doing something that is obviously not the most efficient use of our resources? Ms. Wedel. What you are describing is at least in part a symptom of the fact that the aid effort was very scattershot, not very well planned, and not exactly high level. Rhetorically, it was always compared to the Marshall Plan, but that was a fallacious comparison, not only because there was so little capital assistance available in comparison but also because it was not a particularly high level effort and it was constructed so that lots of different groups got a piece of the pie. Once you have that setup you are naturally going to have many people who are going to be vying for contracts. So the first thing is to have a very well-planned, well- conceived aid effort, which isn't set up so that everybody gets something. It must have a higher level of leadership so it can have a higher promise and potential. Mr. Bereuter. Thank you. I would ask Dr. Serwer a question or two and then turn to my colleague. As you point out, the emphasis of the United States should be on stability in this region. You talked about the need for preventive action; and I think you are absolutely right, that it is self-evidently important. I know there was a high official ministry in the Federal Republic of Germany who looked at the situation, eventually resigning because he felt so guilty about the decision that had been made to recognize the independence of Slovenia, knowing full well what that would lead to in Croatia. Despite all of the advice from other countries to the contrary, Germany took a very unconventional step for them in going out front on something. One of the lessons I draw from this, which is tough for an American to conclude, is that there are some things more important than self-determination and one of them was to focus on stability for the region. Perhaps you heard my comments about Montenegro and the invitation to the U.N. and NATO and the kind of talks in which they hope to be engaged in September with Belgrade relating to a looser Federal structure in Yugoslavia, and the likelihood of the lack of success for that effort. What do you think we should be doing now, speaking of preventive action, in Montenegro to keep that from degenerating into the next Balkan conflict? And, what do you think perhaps we could have done when we had the first engagement of Croatian and Serbian troops in eastern Croatia? Was that a time when we could have militarily engaged if the U.N.--excuse me, if NATO was ready in this post-cold war era? Dr. Serwer. It is difficult, Mr. Chairman, to second-guess people about things that happened in Croatia that long ago, but your question about Montenegro is a very current and difficult one, I will say that. I believe that we should be establishing as much of an international presence in Montenegro as we possibly can at this point, and I find ambiguous--dangerously ambiguous--the Administration's statements about what it will do if Montenegro is attacked. I think we know from the past that ambiguity with Mr. Milosevic leads to a continuous raising of the threshold for action; and raising the threshold for action leads to the need for greater and greater responses. One British magazine has counted 44 final warnings to Mr. Milosevic since 1991. I am not advocating one more final warning about Montenegro, but I do believe that the Administration has to think hard about what it will do if Montenegro is attacked. I think they have to recognize that within the Alliance there is not a great deal of support for going to war again over Montenegro. They also have to realize that the best prevention is deterrence in this case; the Montenegrins are going to have to be strong and the international presence in Montenegro should be strong. Mr. Bereuter. Thank you, Dr. Serwer. I would like now to turn to Dr. Cooksey for questions he may have. Mr. Cooksey. Thank you, Mr. Chairman. I don't know whether you heard my comments on my impression that most of the world leaders of this generation are narcissistic whimpy-type guys; and Milosevic was that way in his youth in his high school--poor health. And yet once they gain some position of power, they suddenly become warriors. Maybe they are too young to be cold war warriors, but warriors they are in their own mind, and so forth. What lessons do you think that we should have learned in Bosnia that we can translate into avoiding mistakes in this area in Kosovo and dealing with what remains of Yugoslavia, Dr. Serwer? Dr. Serwer. My view, Mr. Cooksey, is that there are several lessons that should be learned. The first lesson is that in these international interventions, we can't afford a divided command. We need a unified command, not only of the military but of the civilians as well. Mr. Cooksey. Can I ask a question? Would you elaborate on the question that I asked in the first meeting about stopping the Russians on their way to the airport? Was that a manifestation of what you are talking about? Dr. Serwer. It was a manifestation on the military side of a lack of unity of command, both in Bosnia and in Kosovo; and I think it was a dangerous moment and an edifying moment. But I was referring to something different. I believe that the pattern we followed in Bosnia of dividing the military from the civilian command and having a military commander who is not responsible for civilian implementation and a civilian commander who can't command military forces was a mistake in Bosnia. It was done to satisfy the United States, which wanted to maintain intact the NATO chain of command. Mr. Cooksey. You are referring to Bosnia now? Dr. Serwer. Yes, I am referring to Bosnia now. Now, in Kosovo, in theory, the civilian and military commands have, again, been separated, and I think that was a mistake. In practice, however, as somebody indicated already this morning, the military is in charge in Kosovo at this moment. Why is that? The reason is that there is no preparedness on the civilian side. The military worries when its preparedness falls a couple of percentage points off 100 percent, as rightly it should. There is no concept of preparedness on the civilian side, except perhaps among the NGO's who do humanitarian relief work, but the U.N. essentially has to go out and hire all of these folks every time there is an intervention. There is very, very little sense of preparedness. I think we are seeing some of the negative consequences of that in Kosovo today in the truly tragic treatment of the Kosovar Serbs. So I believe in unity of command. I believe the command should have been unified in Kosovo under the military commander, a NATO military commander, at least for the first six to eight months of the intervention. I think the ambiguity about who is really in charge is most unfortunate in Kosovo. I think there are other things we should have learned from Bosnia, including that there are indigenous organizations that can be used in the peace process. And in Kosovo you had a very extensive array of nongovernmental organizations, including a whole educational system which was nongovernmental because it existed independently of the Serbian educational system. One of the incredible things about Kosovo today is that the kids are back in school; that alternative educational system has enabled children to go back to school almost immediately. Yet the international community is depending very little on these indigenous capacities and has to some degree even avoided allowing them access to the U.N. and to the international structure being created. This is clearly an error. Kosovo is liberated territory. It is not conquered territory. It should be treated the way liberated territory is treated, which includes the most rapid turnover possible of functions to local organizations. Now, there is a big problem, because those local organizations are, of course, ethnically based for the most part, and that is where the U.N. and the NATO forces have to play a role in insisting on the ethnic integration of those institutions. You cannot have, in Kosovo, a true democracy that treats Serbs as badly as they are being treated today. Mr. Cooksey. When you referred to these indigenous organizations in the education system, you are telling me there is an educational system outside of the government's educational system; it is like private schools or parochial schools? Dr. Serwer. They were schools that were created, Mr. Cooksey, by the Albanians when they were excluded from the Serbian educational system. Mr. Cooksey. From the public education system? Dr. Serwer. Yes. So they are private in a sense. They were run mostly in people's homes. They weren't run in school buildings, and they have been reopened almost immediately with the return of the refugees and displaced people. Mr. Cooksey. Sounds similar to some of the debates we have had in this body. Thank you, Dr. Serwer. Thank you, Mr. Chairman. Mr. Bereuter. Thank you very much, Dr. Cooksey. I would like to announce and introduce Elmer Brok, who is the new Chairman of the Foreign Relations Committee of the European Parliament, an old friend of this Member and many Members of the House of Representatives. Great to have you here, Elmer. Dr. Cooksey, would you see if Mr. Engel has any questions, and then would you conclude the hearing for me so that I can proceed with Mr. Brok? I want to thank all of our witnesses for their effort today. It was very helpful to us. Dr. Cooksey, I turn it over to you so that you may close out the hearing. Mr. Cooksey.--[Presiding.] Mr. Engel. Mr. Engel. Thank you. I just want to ask a couple of, I think, relatively quick questions. I have been perhaps the leading advocate in the House for independence for Kosova. The reason I have done it, and I am more convinced than ever that nothing else long range will work, is because I think that, first of all, the Belgrade regime has lost any kind of right that it ever had to govern in Kosova because of the ethnic cleansing that went on and all the other horrible things. I think that if NATO wants to treat Kosova as a protectorate forever and occupy it forever, then we can continue to do that. But, I think if we don't want to do that, we don't want U.S. troops on the ground forever, then independence is the only solution. I have often said that when the former Yugoslavia broke up, the other citizens of the former Yugoslavia, the Bosnians and the Croats and the Slovenians and the--who am I leaving out? Mr. Bugajski. Macedonia. Mr. Engel. The Macedonians, all had the right to self- determination. I believe that the Kosovar people should have the same right, as well. I would like to hear what the panel thinks about that. I want to also add that as someone who, again, is very sympathetic to what the Kosovar Albanians have gone through for many, many years, I, as strongly as anyone else, condemn atrocities committed on both sides. I think that the killing of the 14 Serbian farmers was unfortunate, as the killing of any innocent civilian is unfortunate. One of the things that I think we have to resist, though, is to put them both on a moral equivalency as if somehow the atrocities have been equal on both sides. While we must condemn them on all sides, and I condemn every atrocity, be it committed by a Serb or an Albanian, I think that we have to understand that the ethnic cleansing that went on--I heard one of my colleagues on the floor the other day say, well, it wasn't 100,000 ethnic Albanians that were killed during the NATO bombing campaign; it was only 10,000-- and I thought, well, you know, if I had a family member who was one of the 10,000, that is no solace to me that it wasn't 100,000. So, I think we need to be careful about putting the atrocities on a moral equivalency. But, I am convinced more than ever that independence is the only solution. So I would like to hear some of the comments. I know, Mr. Bugajski, we have had some discussion about this in the past. I would be interested in hearing what you have to say about this and the other Members as well. Mr. Bugajski. Thank you. I completely agree that without independence for both Kosovo and Montenegro, we are going to be faced with continuing instability, because Milosevic will continue to manipulate those differences, both ethnic and republican, within the remaining Yugoslavia. Yugoslavia is finished, and if we do not take appropriate action, if we do not have a clear objective, two or three years down the road we will be faced with a major policy problem, how to deal with a semi-independent Kosovo Administration and a Serbia that demands Kosovo back. I think now is the time to decide on Kosovo's future status, not in two years, not in three years' time, and the only people who can decide are the population of Kosovo. The other question as far as expulsion of Serbs or the fleeing of Serbs, I don't think there is any equivalence. The attacks on the Albanian population were government ordered, systematic, orchestrated, and planned well in advance and carried out with incredible brutality. What we are now witnessing in Kosovo is somewhat different. Quite frankly, I am surprised at the low level of revenge of a lot of returning Albanians. The number of deaths, I think, are under 100, on both the Albanian and Serbian side. It is terrible, of course, that Serbs are fleeing, particularly the innocent ones, but I don't think it is systematic, this is not ordered by any Albanian organization. These are local, sporadic revenge attacks. All the more reason that we need a systematic system of justice in Kosovo, both to try the war criminals that are present, but also to prevent new crimes. And, third, there is a third wave of expulsions which has not really been reported in the press, which is a continuing expulsion of Albanians from Serbia proper into Kosovo. Between 5,000 and 10,000 have already been forced out of their homes. We have been focusing on the Serbs that are leaving Kosovo. There is also a huge Albanian community within Serbia proper that is currently experiencing what is probably similar to what some of the Kosovo Albanians faced just a few weeks ago. Thank you. Mr. Engel. Thank you, Mr. Bugajski. Dr. Serwer. Mr. Serwer. Mr. Chairman, I wonder if I could also respond because I disagree with Mr. Bugajski on this point. I think, yes, that the question of Kosovo's future status will have to be taken up. I don't believe for a moment that there is an equivalency between the dimensions of the horrors that were committed against the Albanians and what is going on with the Serbs today. But I also believe that no people can claim independence under the circumstances that exist in Kosovo today. It is absolutely critical that we not embark on independence for states that do not have a rule of law, that do not have a democratic system in place. There is no question, quite apart from the question of equivalency, that the current vendetta against the Serbs in Kosovo is going to set back the cause of those who seek self-determination for Kosovo. Mr. Engel. I understand my colleague has to go. So I will accede to that, and I thank him. Mr. Cooksey. Go ahead. Do you have another question? Mr. Engel. I want to talk about the prisoners, the Albanian prisoners that were taken out of Kosovo into Serbia. We understand there are many, many Albanians, ethnic Albanians from Kosovo now in jails in Belgrade and in Serbia. I think that that is an issue that the West needs to raise. We, unfortunately, did not raise that issue when we negotiated the withdrawal of the Serbian forces. And I just wonder if anybody has any comments on that. Mr. Cooksey. Yes, Dr. Serwer. Dr. Serwer. Mr. Chairman, Mr. Engel, I think this is really a disaster story. I think we need to raise the diplomatic level of our protests on this issue. I was informed yesterday that Professor Bardhyl Caushi, whom I know personally from some Institute activities, was among those arrested and is now in prison in Serbia. I find it outrageous that more has not been done on this issue, and I think we simply have to raise our voices and insist that these people be released. Mr. Engel. Thank you. I will turn back the chair. I just wanted to say that I had an amendment which was passed unanimously by the House in a recorded vote, there wasn't one negative vote, demanding the release of these prisoners and the accounting for them. I thank my colleague for his time. Mr. Cooksey. Surely. We want to thank our witnesses for coming today for their testimony, and, most importantly, for their patience with interruptions that we have. We still have to vote casionally, you know. The Committee may followup with additional hearings on this subject. This, I am sure, will be an ongoing issue and subject of discussion, and yet I feel that your testimony gave us and provided a really good foundation for where we need to go. Giving us good background and you have impeccable credentials, we are glad to have people of your caliber here. The Committee stands adjourned. [Whereupon, at 1:33 p.m., the Committee was adjourned.] ======================================================================= A P P E N D I X August 4, 1999 ======================================================================= [GRAPHIC] [TIFF OMITTED] T2629.001 [GRAPHIC] [TIFF OMITTED] T2629.002 [GRAPHIC] [TIFF OMITTED] T2629.003 [GRAPHIC] [TIFF OMITTED] T2629.004 [GRAPHIC] [TIFF OMITTED] T2629.005 [GRAPHIC] [TIFF OMITTED] T2629.006 [GRAPHIC] [TIFF OMITTED] T2629.007 [GRAPHIC] [TIFF OMITTED] T2629.008 [GRAPHIC] [TIFF OMITTED] T2629.009 [GRAPHIC] [TIFF OMITTED] T2629.010 [GRAPHIC] [TIFF OMITTED] T2629.011 [GRAPHIC] [TIFF OMITTED] T2629.012 [GRAPHIC] [TIFF OMITTED] T2629.013 [GRAPHIC] [TIFF OMITTED] T2629.014 [GRAPHIC] [TIFF OMITTED] T2629.015 [GRAPHIC] [TIFF OMITTED] T2629.016 [GRAPHIC] [TIFF OMITTED] T2629.017 [GRAPHIC] [TIFF OMITTED] T2629.018 [GRAPHIC] [TIFF OMITTED] T2629.019 [GRAPHIC] [TIFF OMITTED] T2629.020 [GRAPHIC] [TIFF OMITTED] T2629.021 [GRAPHIC] [TIFF OMITTED] T2629.022 [GRAPHIC] [TIFF OMITTED] T2629.023 [GRAPHIC] [TIFF OMITTED] T2629.024 [GRAPHIC] [TIFF OMITTED] T2629.025 [GRAPHIC] [TIFF OMITTED] T2629.026 [GRAPHIC] [TIFF OMITTED] T2629.027 [GRAPHIC] [TIFF OMITTED] T2629.028 [GRAPHIC] [TIFF OMITTED] T2629.029 [GRAPHIC] [TIFF OMITTED] T2629.030 [GRAPHIC] [TIFF OMITTED] T2629.031 [GRAPHIC] [TIFF OMITTED] T2629.032 [GRAPHIC] [TIFF OMITTED] T2629.033 [GRAPHIC] [TIFF OMITTED] T2629.034 [GRAPHIC] [TIFF OMITTED] T2629.035 [GRAPHIC] [TIFF OMITTED] T2629.036 [GRAPHIC] [TIFF OMITTED] T2629.037 [GRAPHIC] [TIFF OMITTED] T2629.038 [GRAPHIC] [TIFF OMITTED] T2629.039 [GRAPHIC] [TIFF OMITTED] T2629.040 [GRAPHIC] [TIFF OMITTED] T2629.041 [GRAPHIC] [TIFF OMITTED] T2629.042 [GRAPHIC] [TIFF OMITTED] T2629.043 [GRAPHIC] [TIFF OMITTED] T2629.044 [GRAPHIC] [TIFF OMITTED] T2629.045 [GRAPHIC] [TIFF OMITTED] T2629.046 [GRAPHIC] [TIFF OMITTED] T2629.047 [GRAPHIC] [TIFF OMITTED] T2629.048 [GRAPHIC] [TIFF OMITTED] T2629.049 [GRAPHIC] [TIFF OMITTED] T2629.050 [GRAPHIC] [TIFF OMITTED] T2629.051 [GRAPHIC] [TIFF OMITTED] T2629.052 [GRAPHIC] [TIFF OMITTED] T2629.053 [GRAPHIC] [TIFF OMITTED] T2629.054 [GRAPHIC] [TIFF OMITTED] T2629.055 [GRAPHIC] [TIFF OMITTED] T2629.056 [GRAPHIC] [TIFF OMITTED] T2629.057 [GRAPHIC] [TIFF OMITTED] T2629.058 [GRAPHIC] [TIFF OMITTED] T2629.059 [GRAPHIC] [TIFF OMITTED] T2629.060 [GRAPHIC] [TIFF OMITTED] T2629.061 [GRAPHIC] [TIFF OMITTED] T2629.062 [GRAPHIC] [TIFF OMITTED] T2629.063 [GRAPHIC] [TIFF OMITTED] T2629.064 [GRAPHIC] [TIFF OMITTED] T2629.065 [GRAPHIC] [TIFF OMITTED] T2629.066 [GRAPHIC] [TIFF OMITTED] T2629.067 [GRAPHIC] [TIFF OMITTED] T2629.068 [GRAPHIC] [TIFF OMITTED] T2629.069 [GRAPHIC] [TIFF OMITTED] T2629.070 [GRAPHIC] [TIFF OMITTED] T2629.071 [GRAPHIC] [TIFF OMITTED] T2629.072 [GRAPHIC] [TIFF OMITTED] T2629.073 [GRAPHIC] [TIFF OMITTED] T2629.074 [GRAPHIC] [TIFF OMITTED] T2629.075 [GRAPHIC] [TIFF OMITTED] T2629.076 [GRAPHIC] [TIFF OMITTED] T2629.077 [GRAPHIC] [TIFF OMITTED] T2629.078 [GRAPHIC] [TIFF OMITTED] T2629.079 [GRAPHIC] [TIFF OMITTED] T2629.080 [GRAPHIC] [TIFF OMITTED] T2629.081 [GRAPHIC] [TIFF OMITTED] T2629.082 [GRAPHIC] [TIFF OMITTED] T2629.083