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Gold-plated State Department Budget Wastes Billions

Payoffs, Mismanagement, Spies, and Globe-trotting "under secretaries" untouched while heating oil and education funds for poor are cut
Matthew J. Nasuti (Former U.S. Air Force Captain)
Monday 21 February 2011

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The U.S. Department of State, oblivious to the budget crisis and contemptuous of President Obama’s pleas for innovation and competitiveness, last week unveiled its bloated $50.9 billion budget proposal for Fiscal Year 2012, which begins this October.

It is virtually identical to its FY2011 proposal. This reporter’s analysis is that the $50.9 billion could be easily cut by 10% and most probably could be cut by up to 20% with no impact on efficiency. This article summarizes just a few of Kabul Press?’ findings of financial waste and corruption within the State Department.

A little known audit report was published last year regarding U.S. Embassy operations in Kuala Lumpur, Malaysia. It found that all U.S. diplomatic personnel had been removed from the community and were now living in a secure apartment complexes with 24 hour security.

This trend is being repeated through-out the world as U.S. diplomats retreat from the people they were sent to meet and befriend. This evolving policy, based on mostly imagined and exaggerated threats, is for all diplomats to live in fortified bubbles protected by private security armies and mercenaries. The cost of doing so is enormous, but the policy has never been openly debated, nor has the damage to U.S. diplomacy ever been calculated.

Several months ago, NBC’s chief foreign affairs correspondent Richard Engle posted a blog in which he described U.S. diplomats as increasingly isolated. Local host officials were only able to meet their American counterparts if they traveled to the U.S. Embassy and first went through security screening. These practices radiate fear and weakness on the part of the United States.

The cost impact of this policy is reflected in a new reality, which is the “Billion Dollar U.S. Embassies.” One has been completed in Baghdad, one is proposed for London and one is on its way to being built in Kabul, to name a few. According to Rahim Faiez of the Associated Press, the State Department plans to spend $511 million to expand its Embassy in Kabul, on top of $790 million it has already spent on diplomatic buildings in Kabul, Herat and Mazar-e Sharif.

The capital costs listed above reflect only a portion of the funds being spent annually. For example, on April 2, 2010, Al Kamen, writing for the Washington Post, reported that the U.S. Embassy in Kabul leases an adjacent 4.8 acre parcel upon which it has built an additional access road. It pays an Afghan landlord $859,440 per year, on top of a one-time payment of $700,000. The one-time payment is apparently to compensate the landlord for tearing down a small mosque on the property so American vehicles can drive over it.

The U.S. Embassy in Kabul plans to add almost a thousand new employees by January 2012, as part of the “U.S. Civilian Uplift” program. An October 26, 2010, audit of this program by the U.S. special inspector general revealed that many of the Embassy’s employees simply sit in Kabul or on U.S. military bases and appear to accomplish little.

Yang Lei and Christine Schiffner, writing for Xinhua reported on Hillary Clinton’s February 18, 2011, speech to one of her politically-connected favorite contractors, The Asia Society. She told them that the United States currently had 11,000 civilian employees working in Afghanistan. This huge number has apparently never before been made public. What all these people do is a mystery, therefore most could probably be sent home at substantial savings.

The 11,000 figure raises the issue of Embassy “rightsizing.” This is euphemism was coined by the U.S. State Department as it never wants to admit that it over-staffs some of its more popular or important embassies. In July, 2010, the State Department’s Inspector General announced the results of his audit of the U.S. Embassy in Baghdad. The report was alternatively clear and vague. The inspectors found a substantial need to rightsize the embassy. It appears from studying the report that the rightsize would involve eliminating between 600 and 800 positions, out of a total staff of 1873. These are diplomats and staff that simply were not needed. The cost of such mismanagement was well over $100 million a year. Acting Inspector General Harold Geisel refused to name any accountable officials. As a result, to-date, no one at the State Department has been publicly disciplined or fired as a result of this clear and massive waste of public funds.

The State Department plans to spend some of its new money on its new spy program. Thanks to WikiLeaks we learned that Secretary of State Hillary Clinton approved a Secret document entitled: “National HUMINT Collection Directive.” “HUMINT” is a CIA intelligence gathering term. It is short for “human intelligence” or the recruitment of spies. Despite the fact that the U.S. Department of State, pursuant to “Intelligence Community Directive 304 ‘Human Intelligence,’ is not authorized to recruit spies, the Department has decided to enter the spy realm. Its clumsy efforts at spying were revealed in the arrest of Raymond Davis on January 27, 2011, in Pakistan.

Al Kamen of the Washington Post also revealed a small scandal, which appears to be a symptom of a larger problem of corruption within the State Department. He reported on April 2, 2010, on the misadventures of just one of the thousands of political appointees who occupy the U.S. State Department.

Secretary of State Hillary Clinton had appointed Reta J. Lewis to the nonsensical position of “special representative for global intergovernmental affairs.” She began her new job in March 2010, by traveling to the Caribbean resort island of Martinique for a conference of world cities. Then she and an aide flew to Rio de Janeiro, apparently arriving on a Thursday night to attend the World Urban Forum conference that was ending the next morning. She then decided to stay the weekend in Rio, at government expense, at the Copacabana Marriott before flying home.

[Note: other sources reported on the hiring of Ms. Lewis. Federal Election Commission documents reveal that she made thousands of dollars of political contributions to Hillary Clinton’s campaign for President. Secretary Clinton repaid her with this current appointment. Apparently Ms. Lewis would have been barred from a political appointment within the Obama Administration as she could not meet the conflict of interest requirements, so Secretary Clinton bypassed the rules and brought her into the State Department as a Civil Service Schedule “B” employee. This tactic damages the image of the Civil Service, where appointments are supposed to be made on merit.)


The U.S. Embassy in Italy (according to the Embassy’s website) is currently seeking to award a contract for up to $150,000 for someone to write a book about the Ambassador’s official residence in Rome. Why this is necessary was not explained nor did the Ambassador explain why his staff could not write this book.

The U.S. Embassy in Jordan, on January 12, 2011, awarded $100 million in grants to the Kingdom of Jordan, which included $31 million in cash to “advance reforms” and $10.5 million to “create job opportunities for Jordanians.” The necessity for these grants was not explained, nor was it explained why the funds were not spent for American job opportunities.

The U.S. Embassy for Polynesia is about to open its new Embassy complex on Suva. Built for only 25 diplomats and U.S. employees, is it reportedly 4600 square meters and costs a gold-plated $50 million (the costs almost doubled from the original 2007. estimate).

If these figures are correct, the complex costs an astonishing $11,000 a square meter. Compare that with $1,000 a square meter for residential construction in nearby Bali.

The State Department has dozens of Assistant and Deputy Assistant Secretaries along with thousands of other senior diplomats. Some, such as Ms. Lewis are political appointees and some are semi-retired diplomats for whom some job must be found. Secretary of State Clinton has created a gaggle of positions for these people, providing them with staff and travel budgets and then letting them crisscross the globe traveling at the expense of U.S. taxpayers, apparently with no supervision. The following is just a few of the thousands of abuses that occur annually:

  • Philo L. Dibble, Deputy Assistant Secretary of State, flew to Paris for a short interview on January 27, 2011, with four French journalists. He said nothing noteworthy in his remarks and no apparent press coverage resulted.
  • Michael Posner, Assistant Secretary of State for Democracy, Rights and Labor, flew to Cairo for a short October 9, 2010 interview with some local reporters. His said nothing noteworthy in his remarks and no apparent press coverage resulted.
  • Hannah Rosenthal, U.S. Special Envoy to Monitor and Combat Anti-Semitism traveled to Vienna on February 17, 2011, to give a short speech to the Organization for Security and Co-operation in Europe (OSCE). She vaguely implored everyone to do more to combat anti-Semitism. She was accompanied by Farah Pandith, U.S. Special Representative to Muslim Communities who also gave a short speech about the need for everyone to be less anti-Muslim. Their remarks were not reported in the press as they said nothing noteworthy.
  • Jeff Feltman, Assistant Secretary of State for Near Eastern Affairs, flew to Cairo for a short October 14, 2010, interview with some local reporters. He said nothing noteworthy in his remarks and no apparent press coverage resulted.
  • David Thorne, the U.S. Ambassador to Italy, decided to travel to Afghanistan from January 17-19, 2011, solely to visit Italian troops stationed there!
  • Susan Page, Deputy Assistant Secretary of State, flew to Tunis for a two-day conference in April 2010, on “international realities.”
  • Donald Beyer, U.S. Ambassador to Switzerland, flew to Copenhagen for some or all of the December 7-18, 2010, conference on climate change.
  • Stephen Koltal, Senior Advisor for Global Entrepreneurship, apparently is traveling the world with his staff promoting his pet project, the GEP (Global Entrepreneurship Program). He began in Cairo.
  • Robert O. Blake, Jr., Assistant Secretary of State for South and Central Asian Affairs, traveled to Uzbekistan from February 17-18, 2011, for the ABCs (Annual Bilateral Consultations) with representatives of brutal dictator Islam Karimov, who is being kept in power by his NSS secret police.
  • Dr. Kerri-Ann Jones, Assistant Secretary of State for Oceans and Environmental and Scientific Affairs, traveled to Uzbekistan earlier this month for a series of “scientific” meetings. She was also reported to be in Cairo.
  • Ann Stock, Assistant Secretary of State for Educational and Cultural Affairs, accompanied by Alina Romanowski, her Deputy Assistant Secretary traveled to Malaysia earlier this month for a luncheon to discuss the Malaysian-American Alumni Partnership (MAAP) and then traveled to the resort city of Penang to visit a local library. The total length of the visit was at least three days (February 10-12).
  • Finally, Stephen J. Rapp, Ambassador-at-Large for War Crimes Issues, traveled to New Zealand last month. The local U.S. Embassy announced his visit on its web site but was unable to explain what Rapp was actually doing there, other than meeting some colleagues.

Multiply all this useless travel times thousands or perhaps tens of thousands of officials (as the Department has over 100,000 employees) and the costs are staggering. This article does not even begin to touch the amount of waste involved in preparing for and attending United Nations conferences (especially those involving “climate change”), NATO conferences, the G-8 and G-20 conferences, and all the regional security and cooperation conferences.

It was very difficult to locate and verify the above few examples because there is no transparency within the State Department and no way to access travel records by senior officials and their staffs. The amount of travel, destinations, cost, luxury accommodations and lack of necessity for the travel appear to be too politically embarrassing to publicly list.

The State Department spends hundreds of millions of dollars each year to fund many other programs covering such development topics as “governance,” “democracy” “English as a second language” and “rule of law.” All of these should be officially evaluated as they have had either mixed or poor success. It also funds television and radio shows and helps foreign countries with their exports to the United States (which is of dubious value to the U.S. taxpayers).

The Department, which hires large numbers of economists, tends to look down on crucial (but boring) humanitarian aid projects in favor of spending foreign aid dollars on more interesting development aid programs. Afghanistan is one prime example.

With more than 30% of the population not receiving enough food (according to the U.N.’s World Food Programme), the U.S. Embassy in Kabul (according to its own website) is funding trendy electronic banking programs, television game shows and export conferences. It does not appear to be funding any humanitarian aid projects within the country.

In conclusion, Secretary Clinton, the U.S. Congress, and White House should take steps to halt the financial waste and mismanagement by U.S. diplomats and bureaucrats. A 10% cut in the U.S. Department of State’s operating budget is a necessity, with a 20% cut preferable.

Those cuts should eliminate one of the two Deputy Secretaries of State, at least four of the eight Under Secretaries of State, all 25 special envoys and their staffs, half of the 51 Bureaus and Offices with their corresponding Directors or Assistant Secretaries of States, and all of the Diplomats in Residence (i.e., loaned to various U.S. universities for one-two year periods).

The cuts should target unnecessary officials, consultants, staff, travel, consulates and development programs. Such reforms would enhance overall U.S. diplomacy as it would focus U.S. efforts. At the present time, U.S. diplomats are promoting hundreds of projects and initiatives that overlap, are confusing and have no common themes. The intent is simply to go out and support everything, regardless of cost or merit.

For example, Secretary Clinton appointed her former Senate aide Kris Balderston as “U.S. Special Representative for Global Partnerships.” It is not clear what he does or why hundreds of thousands of U.S. taxpayer dollars are being spent supporting him and his office.

President Obama spent the past two weeks urging the private sector in America to embrace efficiency, innovation and competitiveness. He would have been better served to have called a Cabinet meeting in order to impress those important virtues on his staff. If Secretary Clinton refuses to act responsibly in cutting her bloated budget, then the task falls to Congresswoman Ileana Ros-Lehtinen, Chairwoman of the House Foreign Affairs Committee, and, Congresswoman Kay Granger, who chairs the House Appropriations Committee subcommittee overseeing the State Department.

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