UNDER SECRETARY KENNEDY: Good morning, everyone. Before beginning this Secretary of State town hall meeting on the QDDR, I would like to ask all of you to rise for a moment in a moment of silence and memory of Ambassador Richard Holbrooke, who so sadly passed away on Monday evening.

(A moment of silence is observed.)

UNDER SECRETARY KENNEDY: Thank you very much.

Before proceeding, I would like to remind everyone that this session is being carried live and by the media and thus is on the record. So please remember – (laughter) – that in your questions, which should relate to the QDDR, that the world is watching and listening. (Laughter.)

It is now my distinct honor and personal pleasure to introduce the Secretary of State Hillary Rodham Clinton. Madam Secretary. (Applause.)

SECRETARY CLINTON: Well, thank you very much. And there are a lot of people standing. There are some seats down here. I know it’s a little bit like coming late to church, but you can come down to the front if you wish to. And I appreciate the very great interest that this turnout evidences. I want to welcome all of our guests from Congress, other agencies, NGOs, and think tanks. I want to thank all of my colleagues from State and USAID for taking time out of your very busy day to join us. I would especially like to thank USAID Administrator Dr. Raj Shah, Deputy Administrator Don Steinberg, Director of Policy Planning Anne-Marie Slaughter, who, along with Pat Kennedy and myself, will be fielding your questions when they begin.

It’s also a special pleasure to welcome back OMB Director Jack Lew, our former but not forgotten deputy. (Applause.) We’re especially pleased he could break away from budgeting and pass-backs and be reminded about how important the missions of State and USAID are. (Laughter.)

Before we get into what this report says and how we will implement it, I want to thank all of you for your vision, inspiration, and perspiration that made it possible.

Jack, Raj, and Anne-Marie led a great team, including Karen Hanrahan, Bill Burke-White, Marisa McAuliffe, and so many others. Hundreds of people from the State Department and USAID, and especially from the field, along with other agencies of our government, Congress, and outside organizations, contributed your ideas and suggestions. And I thank each and every one of you for your energy and your commitment.

I also appreciate Pat reminding us that we lost one of our most respected colleagues and one of America’s most distinguished diplomats with Ambassador Holbrooke’s passing. We are dedicating this first-ever QDDR to his memory. Because every day, I see many of the qualities that I saw in Richard over the years in so many of you – love of country, intellect, determination, fearlessness, and insistence that we back up our words with our actions. And I thank you for holding yourselves to the highest standards of excellence.

You and your colleagues posted around the globe are among the finest public servants our country has ever produced. And from my very first day here at the Department, I have been honored to serve with you and humbled by your efforts.

So I’m very pleased that many of you could join us, and those who are not here in person joining via the internet, for this substantive and sustained conversation about how we can work better and smarter on behalf of the American people.

To drive that conversation, I am proud today to unveil the first-ever Quadrennial Diplomacy and Development Review, the QDDR. This is a sweeping effort that asks a simple question: How can we do better? How can we adapt to a world of rising powers, changing global architecture, evolving threats, and new opportunities? How can we look ahead, prepare for, and help shape the world of tomorrow?

The QDDR is a blueprint for how we can make the State Department and USAID more nimble, more effective, and more accountable, a blueprint for how our country can lead in a changing world through the use of what I call “civilian power” – the combined force of all of the civilians across the United States Government who practice diplomacy, carry out development projects, and act to prevent and respond to crisis and conflict.

Leading through civilian power saves lives and money. With the right tools, training, and leadership, our diplomats and development experts can defuse crises before they explode and create new opportunities for economic growth. We can find new partners to share burdens and new solutions to problems that might otherwise require military action. And where we must work side by side with our military partners in places like Afghanistan and Iraq and in other fragile states around the world, we can be the partner that our military needs and deserves.

Now, as you dig into this report, you’ll see that it is driven by two overarching factors.

First is President Obama’s emphasis on fiscal responsibility and efficiency throughout the federal government. Through the QDDR, we have tried to minimize costs and maximize impacts, avoid overlap and duplication, and focus on delivering results. Across our programs, we are redefining success based on results achieved rather than dollars spent. And this will help us make the case that bolstering U.S. civilian power is a wise investment for American taxpayers that will pay off by averting conflicts, opening markets, and reducing threats.

The second factor is a rapidly shifting global landscape. Once, only a handful of great powers had the clout to shape international affairs. Now, power is shared by a wide array of states, institutions, and non-state actors. The information revolution has brought millions of people all over the world into an ongoing global debate – and they, too, can influence events, unleash new threats, or devise new solutions to global problems.

As you see at State and USAID and across our government every day, today’s challenges and opportunities spill over borders and they blur traditional bureaucratic divides. They are complex and interconnected. For example, advancing democracy, promoting sustainable economic growth, and strengthening the rule of law in fragile states are all overlapping and mutually reinforcing endeavors. They cut across bureaus and offices and agencies. They demand not just the skills of our State Department diplomats and USAID development experts, but also the expertise of civilian specialists across the U.S. Government.

For example, professionals at the Department of Agriculture know how to boost crop yields and irrigate fields in Kansas and in Kandahar. Justice Department experts are adept at strengthening rule of law in countries whose democracies are young and vulnerable. To achieve our goals, such as tipping a fragile state away from conflict and towards stability, all elements of American civilian power must be prepared and empowered to work together.

The QDDR will help the State Department and USAID adapt to, shape, and stay ahead of these trends. This is a program of reforms that will fundamentally change the way we do business. Let me outline four broad areas of change.

First, we will adapt to the changing diplomatic and development landscape of the 21st century. The State Department and USAID will direct and coordinate integrated civilian operations that draw on the skills and strengths from across the U.S. Government to make a real difference on the ground. This will require working far more closely and collaboratively with other agencies that are also active overseas, from planning to implementation.

We will support our diplomats as they reach beyond their embassy walls to engage directly with foreign publics, the private sector, NGOs, and civil society, including with women and others who are too often on the sidelines. And we will ensure that our development experts have the tools they need to lead projects themselves, not just dispense grants and manage contracts.

At the heart of this effort will be our ambassadors and chiefs of mission, who are responsible for directing and coordinating U.S. Government personnel in their countries. We will empower them and hold them accountable as CEOs of multi-agency missions, enhance their training, allow them to contribute to the evaluation of all personnel who serve at their posts, and engage them more fully in policymaking in Washington. We will also consider experience with the interagency as one factor for selecting chiefs and deputy chiefs of mission.

Here in Washington, we will reorganize ourselves to better address clusters of related issues that need greater attention, for example, by creating an under secretary for economic growth, energy, and the environment. We will be reconfiguring, more than adding. And where we are adding, we will work with Congress to make a very specific case for that addition, such as a proposed new bureau for counterterrorism, which will help us counter violent extremism and manage counterterrorism partnerships better around the world.

To embrace the potential for civilian power, we will also draw on the personnel of other federal agencies, when appropriate, before turning to private contractors. Sometimes contracting makes sense and does make us more efficient and flexible. But there are core governmental functions that should always be performed by public servants, not private companies. And we don’t necessarily have to develop these functions in-house at State or USAID. They can often be provided by professionals from other government agencies. This change will allow us to build on existing relationships and restore proper government oversight of core functions.

We also believe it will, over time, save us money. And in a time of tight budgets and greater scrutiny, that is one of my highest priorities, so that we clearly can make the case for everything we do to any taxpayer in America.

The second major area of reform is in development. I will say more about this at USAID on Friday. But a core message of the QDDR, following the President’s policy directive on development, is that development is a strategic, economic, and moral imperative, and that we must elevate it alongside diplomacy as a pillar of American civilian power. To do this we will focus our investments in key sectors where we have special expertise and the ability to make the biggest impact: in food security, global health, climate change, sustainable economic growth, democracy and governance, and humanitarian assistance. And we will emphasize the rights of women and girls throughout.

At USAID, Raj, Don, and their team are practicing high-impact development, investing in game-changing innovations that can scale up and potentially transform millions of lives. USAID’s new venture capital-style fund called “Development Innovation Ventures” has already invested in solar lighting in rural Uganda, mobile health services in India, and an affordable electric bicycle that doubles as a portable power source. And that’s just the beginning.

The United States used to take the lead in such technological innovations, and I want to see us do so again. We are determined to rebuild USAID as the world’s premier development agency. The USAID forward agenda, which grew out of the QDDR process, is helping the agency recruit, train, and retain top development professionals, reduce dependency on contractors, and improve oversight and accountability.

USAID has established a new Bureau of Policy Planning and Learning to promote innovation, research, and evaluation, and has created a new office charged with developing the agency’s annual budget proposal and overseeing budget execution.

We will make our aid more transparent by, among other steps, creating a new web-based dashboard that will publish data on State and USAID foreign assistance. And starting immediately, USAID will assume the leadership of Feed the Future, the Administration’s Global Food Security Initiative.

With the Global Health Initiative, we are targeting the end of 2012 to transition its leadership to USAID, provided that USAID and its partners meet the benchmarks that we have set.

These are important steps that will help our development experts around the world do their job more effectively.

The third key area of change deals with how we work to prevent and respond to crisis and conflict. A hard-learned lesson of recent years is that the failure of even the most remote state can have serious implications for our national security in this interconnected world. America’s civilian power must be able to strengthen fragile states, stop conflicts before they start, and respond quickly when prevention fails. We will make conflict prevention and response a core mission of the State Department and USAID.

For starters, we are uniting our own capabilities here at State under an Under Secretary for Civilian Security, Democracy, and Human Rights, which will consolidate the diplomatic and operational capabilities needed to prevent and resolve conflicts, and to respond to disasters. We are creating a new Bureau of Crisis and Stabilization Operations – CSO in State parlance – that will coordinate early efforts at conflict prevention and rapid deployment of civilian responders.

As we make these organizational changes, we will be strengthening State and USAID’s ability to lead, support, and coordinate civilian operations that use skills from across the federal government. And we are also going to be strengthening our cooperation with partner nations and multilateral organizations like the United Nations.

Supporting our efforts in diplomacy, development, and conflict and crisis, the fourth set of reforms will help us all work smarter and better to deliver results. This is always critically important, but especially now. So we will improve the way we manage contracts and procurement by rebalancing our workforce, enhancing oversight and accountability, and emphasizing local leadership. We will create strategies for regional and functional bureaus. And at the country level, we will unite planning for diplomacy, development, and broader foreign assistance under a single, overarching strategy. We will modernize our planning and budget processes to ensure that we fund our highest priorities, set benchmarks for performance, and establish metrics to ensure each dollar spent has the greatest potential impact.

The changes in the way we work will affect everyone at State and USAID every day. For example, as part of the QDDR review, we surveyed staff at dozens of posts around the world, and found that they are too often tied to their desks, fulfilling hundreds of reporting requirements mandated by both Congress and the Department. I know. Try to contain your shock at that fact. (Laughter.) We believe this can and must change. So we are consolidating or eliminating duplicative reports, making reports shorter, and streamlining workloads. At every level, we will ask again and again: How can we do better?

As we move forward with these reforms, we will harness the power of innovation, applying new technologies, testing new approaches, and searching for creative solutions to entrenched bureaucratic problems. We will practice what you’ve heard me call 21st century statecraft, embracing not just new tools and technologies, but also the innovators and entrepreneurs behind them. We will expand and accelerate our public-private partnerships because we recognize that both government and the private and not-for-profit sectors bring important skills to the table. We will protect ourselves, our networks, and our confidential correspondence through reforms like the creation of a new coordinator for cyber issues.

In short, we are changing the way we do business from top to bottom, but the story does not end here. The reforms included in the QDDR will only make a difference if we all work hard to put them into practice. Implementing the full vision of the QDDR – building capabilities, changing mindsets, and modernizing approaches – will take time, focus, and sustained leadership. But I am determined that this report will not merely gather dust like so many others before it; it will be a priority at both State and USAID.

I will ask the next Deputy Secretary of State for Management and Resources, which we hope will get confirmed – hopefully, Tom Nides – this – before Congress goes out – to bring his enormous talent and energy to the task of overseeing the QDDR’s implementation at State. Administrator Shah will oversee implementation at USAID. But we won’t get very far without your help. So I ask you first to read this report, which is 200-odd pages or so. And we’ve got an executive summary – (laughter) – for those of you who don’t have time to read 200 or so pages. And then I hope you will put your talents, your enthusiasm, your ideas, and your practical suggestions, and your expertise to work to help us turn this vision of reform into a reality.

The important question that we’re asking and we want you to ask and help us answer is: How can we do better? And the QDDR will be up online shortly or imminently. We wanted to make sure we talked together at the time it went up. And we’re going to look for your suggestions and perspectives. It’s a little holiday reading. (Laughter.) I want this to be a two-way conversation and a robust exchange of ideas. We may have overlooked something in the thousands of hours that have been spent over now nearly two years, and we want this to be a very open, candid conversation. But I believe strongly in what State and USAID stand for.

And I also believe strongly that we have to do better, what is clearly our mission to advance American interests and values, to protect our national security, to create greater opportunity for people living around the world, and to do so in a way that justifies the confidence that the people of the United States have in our foreign policy. So with that, let me open the floor up to your questions and discussions, and we’ll call on Under Secretary Kennedy to get us started.

UNDER SECRETARY KENNEDY: Thank you very much, Madam Secretary. (Applause.) The Secretary has time for a few questions before she has to leave for her next appointment. But just a reminder, even though she does have to leave, Dr. Shah, Don Steinberg, and Dr. Anne- Marie Slaughter, and I will remain behind should there be any other questions you might have.

We have two microphones set up plus we’re also receiving questions from our colleagues overseas via the Secretary’s forum. And again, a final reminder, remember, this is a live feed to the world – (laughter) – and so please keep your questions cogent and relevant to the QDDR. We’ll start here, please.

QUESTION: Thank you very much, Pat. I’m Susan Johnson, the president of the American Foreign Service Association, the professional association and union of the foreign services of our five civilian agencies. And I would like to take this opportunity, first, to say that AFSA is also looking to see how we can do better. So we very much identify and support this overall thrust, Madam Secretary. I’d also like to take this public, on-the-record opportunity to state that AFSA welcomes the QDDR and its call for America’s diplomats and development experts to be the first face of American power abroad. So we are fully, fully behind that.

We concur strongly in the need to increase the efficiency and the effectiveness of the State Department, USAID, and our sister foreign affairs agencies, all the more so because we’re facing a competitive world in which, if we want to continue American leadership, we need to do better, not stay where we are. We – AFSA – want to be partners with the QDDR process as it unfolds, so we will be open to and looking for ways that we can contribute to effective implementation.

The QDDR section on recruiting, hiring, and training addresses the mid-level experience gap among other things, now estimated at 200 to 300 positions at the State Department and expected to peak at about 600 positions before closing by 2014 or 2015. AFSA strongly recommends that greater and focused use of Foreign Service retirees, our de facto Foreign Service reserve, be used to fill vacant, mid-level positions until this gap is closed. Our retirees represent an asset that we can’t afford to overlook or ignore. They cost less, they’re quickly available, they need no training, and they can provide badly needed mentoring and coaching.

Secondly, AFSA sees increased professional education and training as critical to developing the premier diplomatic service and development experts that we need, and therefore we’re strong advocates for seeing a training flow not as a luxury, but as a core requirement for the exercise of smart power. And I’d like to know what your views are on these two issues. (Laughter.) Thank you.

SECRETARY CLINTON: Well, I think we are in agreement. We have highlighted the problem of the gap of mid-level diplomats, and we are moving rapidly over the last two years to hire very qualified people for the pipeline who are beginning their career. But we have this gap, and we will certainly look at the suggestion of using retired Foreign Service officers. I think that’s an excellent idea. There will be some consideration given to that, and we will work with you to do so.

And I think in general, we’ve had good cooperation and a very good working relationship with AFSA during this process. We have appreciated your suggestions. And we’re partners, and we want to be as successful in changing the trajectory that we face of this gap and of a likely challenge to our continuing to fill the pipeline for budgetary reasons. So we want to look at a number of different approaches, and you will certainly be part of our effort to do so.

UNDER SECRETARY KENNEDY: A question from the field.

MS. GREENBERG: Good morning. Our first Sounding Board submission comes from Andrew Miller of Consular Affairs. He asks: Will we be revisiting the American Presence Posts concept? Could we consider single-mission American Presence Posts? More than just flying the flag, but have a focus based on an area of need; for instance, one focused solely on development with an AID presence, one focused solely on rule of law with an INL presence, one focused solely on consular work in India or China, lean and mean, virtual as much as possible, but still with some brick-and-mortar requirements?

DR. SLAUGHTER: I will field that one. Thank you for the question from the field. What we provide is exactly to explore, partly through the new public diplomacy strategy that Under Secretary McHale has outlined, a range of posts, including American Presence Posts. This particular vision would be one that we would consider an implementation. But we’ve also emphasized that for experts of the type you’re talking about, whether somebody focused on law enforcement or on women’s issues or on public-private partnerships, they would be regional circuit riders, where they would be based at regional hubs and they would travel around the different embassies of the region to cross-fertilize information, to provide expertise, and to help us think regionally on specific issues.

SECRETARY CLINTON: I want to add that we are both looking, as I said in my remarks, to better unify and focus the physical presence at posts of different agencies under chief of mission authority. I know in my prior lives as First Lady and as senator, it was often clear as I traveled around the world that even in countries where we had State, USAID, and many other U.S. Government agencies represented, there wasn’t the level of cooperation and partnership, so that you sometimes found that people who were working on a different aspect, say, of development didn’t even know who else was in the country from a different American agency. That has absolutely got to end.

And so what we’re trying to do is physically better coordinate under chief of mission authority all of the American Government efforts. But we’re also looking at ways of supplementing posts, as Anne-Marie was saying, with virtual interventions, with regional hubs and circuit riders, because not every post can have a rule of law expert, but there are certainly many places where we would like to further the rule of law as part of our democracy and governance agenda.

So I think this will be somewhat of an implementation demonstration in different places to best see what works, but our goals are very clear.

MODERATOR: On my left.

QUESTION: Madam Secretary, I am Daniel Hirsch. I’m the State Department vice president of the American Foreign Service Association, and I hope that you will allow me to make two additional comments regarding correcting the mid-level staffing gap.

UNDER SECRETARY KENNEDY: If you could, if we could phrase them as a question, please.

QUESTION: I’ll do my best. I will.

First, one tool for fixing the gap that seems to have been overlooked in the QDDR is the retention value of overseas comparability pay. As you know, comparability pay was created in the government as a means for ensuring that the government has access to the best and the brightest talent which might otherwise go elsewhere. If people leave the Foreign Service due to compensation issues or fail to consider the Foreign Service as a career, it will exacerbate the mid-level gap. I hope that you will not allow this important retention tool to be treated as a benefit or mischaracterized as a benefit or as a bonus to the Foreign Service, as some people have done so.

And I hope that you will comment on that after my next comment, which is I would also like to repeat Susan’s – well, to express AFSA’s opposition to mid-level hiring as a means to address this gap. America needs a strong Foreign Service, and whatever other qualifications a mid-level candidate might bring to a job, there is no substitute for experience. Moreover, in our system, it’s expected that more junior members will learn from more senior members, and that is part of the education of an American diplomat. For every mid-level candidate that comes in without experience, that is a supervisor or an office director who cannot pass on needed experience to more junior members. And I hope that you’ll comment on that as well.

SECRETARY CLINTON: Well, I’ll start, and then Raj wants to add.

Look, we want to take advantage of the experience that is available. And our first preference is, of course, to take advantage of Foreign Service experience. And we will look at ways of reaching out and attempting to do so. But we will not stop there if we cannot find the experience. And I just think you need to recognize that we are very respectful and – (applause) – and deeply grateful for the level of experience, expertise, and dedication that we have in our Foreign Service family, but we also have a job to do. And so we will give every effort to try to find people, whether they’re willing to come out of retirement or what else we can entice them to do. But at the end of the day, I’m responsible for making decisions that are in the best interests of the United States of America, and that’s what I will do. (Applause.)

ADMINISTRATOR SHAH: I’ll just add that that question, obviously, was specific to the State Department Foreign Service, but the same issue, of course, is something we’ve tried to be very thoughtful about, at the Secretary’s guidance, with respect to USAID. And we’ve had a chance to both quantify the needs at mid-level and explore how what we’ve learned from the Development Leadership Initiative, which has now brought in 625 new Foreign Service officers at USAID over the last several years. And we have proposed this – a limited but focused and skill-based targeted increase with the mid-level career hiring. And – but we want to do it in a way that’s respectful of all the points you raised, that allows for training, that protects the career growth opportunities for especially new entrants into the Foreign Service, and that enhances our capacity to deliver the types of results the Secretary spoke about. So thank you.

QUESTION: Thank you. (Applause.)

QUESTION: Thank you. I’m Steve Clemons with the New America Foundation. I publish the Washington Note. And I want to congratulate Anne-Marie Slaughter and the whole team for producing this. And we’re really going to miss Anne-Marie when she heads off to Princeton, because I hope the deployment of the report has as much gusto as Anne-Marie has shown in producing it.

My question about the QDDR --

SECRETARY CLINTON: Yes. We fully agree. (Applause.)

QUESTION: Yeah. My question about the QDDR – and I don’t mean to sort of offer a sort of provocative constructive question --

SECRETARY CLINTON: I would expect no less. (Laughter.)

QUESTION: -- is where do the Pentagon and Pentagon resources fit into the picture? General Anthony Zinni at a New America Foundation program offered a critique, and he said as much as he wanted to see USAID and State more fully deployed in this arena, he continued to run into the notion that when it came to thinking like the Pentagon does in simulating crises and how one responds and thinking through every dimension of a challenge to figure it out, he says State and USAID aren’t resourced or even disciplined to operate in that way. And he said he wanted them to, but he saw it as a big deficit.

And so I’m interested, given your close relationship and your many kind of mutual supportive comments with Bob Gates about deploying people and getting them to work, how do you reach across – kind of like Richard Holbrooke was doing in his interagency group. How do you reach across into Pentagon resources and Pentagon personnel and make them – conform is the wrong word, but be good partners with your vision on the development side.

SECRETARY CLINTON: Well, Steve, that’s a very important question and one we spent a lot of time in analyzing, and there’s really three approaches that I would commend to you.

First, we have to be a good partner, and we are well aware that we have a ways to go before we are organized and deployable in a manner that meets the legitimate needs of the kind of civilian- military partnership that both Bob Gates and I believe in. What you will see in the QDDR is our effort to begin to better organize ourselves, to better coordinate between State and USAID, so that we’re not trying to determine, well, who gets deployed and how they get deployed and who they respond to. We can’t keep reinventing the wheel in every crisis. And we’ve learned a lot from what has happened in Iraq and Afghanistan, and we really believe that we are putting forth a better organizational sense. Now, some might say, “Well, that’s just moving the boxes on the organizational chart of the bureaucracy.” That matters. It really matters how we describe how we are organized in order to relate to our friends at the Pentagon. So there are specific organizational reforms.

Secondly, we are trying to build a core of expertise. And one of the, I think, important recommendations that both Anne-Marie and Raj and Don can expand on is that we are looking at what the Congress created, the Conflict Resolution Stability Office. We are trying to create a core of experts who can be on call and deployable. I mean, look, the problem we have is we have a relatively small work force. We’re trying to expand it by having a kind of auxiliary core and also creating better partnerships with the rest of the U.S. Government, very similar to what Richard did with SRAP, which I know created a lot of questions and people wondering what it was, but it was a model of an interagency operational office to deal with one of our highest needs. And so we are looking at how best to do that.

And finally, there is money that has been made available in accounts for State and Defense to work together to expend. We’re trying to, frankly, get back a lot of the appropriation authority that was lost during the 2000s – I guess that’s a word – and that because of the military emphasis in Afghanistan and in Iraq, it just was easier, quicker for the military to do a lot of things. And so you found the military doing development. You had young captains and colonels with discretionary funds, the so-called Commander Emergency Response Funds, the CERF funds, that they were literally able to call on $50- or $100,000 to repair a school outside of Mosul or help build a road in Afghanistan without any of the bureaucratic checks and balances that we go through at AID and State.

So we are well aware that first we have to be a better partner. Secondly, we have to be more operational and expeditionary. And thirdly, we have to win back from the Congress the authority we should have as the coordinators and lead on civilian power in the United States. You cannot work with the Pentagon as multitudes of agencies. That does not work. And one of the key messages in the QDDR is that the State Department has the statutory authority to lead. That doesn’t mean that we’re not in partnership with Justice and Treasury and Ex-Im and everybody else who has a role to play, but you’ve got to have someone accept the responsibility. And that’s what we are offering and, frankly, demanding that we be given in order to make this civilian-military partnership something more than just a phrase.

QUESTION: Thank you. (Applause.)

UNDER SECRETARY KENNEDY: I think that is – Madam Secretary, I think that is --

SECRETARY CLINTON: I can stay a little longer.

UNDER SECRETARY KENNEDY: Very good. From the field.

MS. GREENBERG: Thank you. Our next Sounding Board submission comes from Thomas Goffus, a senior military advisor in EUR. He writes: At Main State, the PM bureau is the likely default contact point for coordinating DOD issues. Under QDDR, State is envisioned as the lead coordinator for multiple domestic agencies that increasingly engage abroad. Will there be a bureau created for coordinating with the scores of U.S. federal agencies other than DOD, for example USDA, Treasury, FAA, et cetera?

DR. SLAUGHTER: Every bureau will be coordinating with all those other civilian agencies. The watchword is exactly inclusive and collaborative leadership. And as the Secretary said, one of the hallmarks of a new way of doing business is precisely that we are not looking out and saying this is only the State Department, this only USAID. We are to be measured on how collaborative and how inclusive we are in every bureau reaching out to our partners across the interagency and making them work better. So if PM is there for DOD, we’re all there for both the civilians in DOD and all the other civilian agencies.

SECRETARY CLINTON: But I think also it’s important to add that we are well aware that PM has been the default reach-out. And PM has very specific, important functions that it performs. And one of the reasons we’re creating a new corps with a new under secretary. We’re taking what is called G, Democracy and Global Affairs, and we’re turning it into Civilian Security, Democracy, and Human Rights. Because we think there has to be synergy among what we do on behalf of stabilization, conflict prevention, refugee flows, human rights work. Because what’s important, and we often have this discussion with our DOD friends, is that you have to have a broader perspective than just the immediate trying to staunch the bleeding. You’ve got to figure out, okay, what happens next and what are the consequences and how do we try to create a more stable environment.

And so what Anne-Marie said is absolutely right. We are tasking everyone at State and USAID to be much more open and collaborative and outreaching to the rest of our government, including DOD, of course, because we cannot expect to produce the best results if we don’t have that attitude.

Take the Global Health Initiative. It’s USAID, PEPFAR, which is part of the State Department, and the Centers for Disease Control, which is part of HHS. We have this triumvirate partnership, and in part because people have not been used to working together in the way that we are going to expect everyone to do so. People bring their own experience, they bring their own expertise, and we are deeply appreciative of that. But we’ve got to listen to each other better. We have to bring to the table the people who are going to be making the decisions that will impact the success of American policy.

So in all of these areas, part of it is organizational, part of it is operational, part of it is funding, but a lot of it is attitude and mindset. And it doesn’t take anything away from State or AID or DOD or HHS or anybody else if we recognize the value added that everybody brings. And so that’s my goal. Because frankly, we – if you look at sort of the problems we face and the challenges we will have in funding our responses, we’ve got to work together and we also have to create this partnership, as Steve was saying, with DOD to kind of enhance what each of us can do more effectively.

Raj, you want to add?

ADMINISTRATOR SHAH: It’s hard to add to that because that’s a very clear and effective point of guidance. But I think to go back to a phrase Anne-Marie used, and the Secretary’s asked us to really build into the core management of USAID in this case, is the concept of inclusive leadership. So to give you a very specific example, we just completed – we’re in the process of doing the senior management group assignments for USAID. We restructured how we do that process so that each senior manager gets evaluated on their interagency performance and skill. That’s basically how we interpret inclusive leadership. And the resulting set of recommendations I got for the top priority mission leadership posts were substantively different. Different people were chosen because we changed the criteria, and the group that came together to debate who’s going to perform well against these new criteria came up with different answers.

We’re going to take that even further by building that criteria into actual performance reviews for the Foreign Service and the SES Civil Service. And we’ve actually had a lot of great conversation at different levels of the agency and amongst the new Development Leadership Initiative members of the Foreign Service about what that means and how that – how we need to have a shift in our mindset as it relates to that point. So I would just add that it’s a very clear aspiration in the document. No document gets you the outcome. We have to manage to that in very specific and concrete ways.

DR. SLAUGHTER: Yes, Don.

MR. STEINBERG: Just to be very specific, we’ve been – Anne-Marie and I have been talking with all of our ambassadors around the world and all of our mission directors together, and we’ve done it specifically together to communicate the same message. And one of the things that we’ve been communicating to all of our AID mission directors is you will no longer be rewarded for being a good infighter. It’s not about fighting for turf. It’s not about AID-centric activities. It’s about the results that you produce; and recognize that in order to produce those results, you need to be working as an inclusive leader with the interagency process. And one of the clear messages that the QDDR communicates is that the AID mission director is the development advisor within the missions overseas. But it also says, with that designation, comes the responsibility for changed behavior. (Applause.)

QUESTION: Well, Madam Secretary, I’m Paul O’Brien. I’m with Oxfam America. We’re an organization that doesn’t take U.S. Government funding precisely so that we can engage in a useful dialogue with the U.S. Government. So thank you very much for staying and thank you very much for inviting us here and all the other NGOs. It reflects the spirit of openness of this Administration and your leadership.

When President Kennedy founded USAID, one of the rationales that he gave was a recognition of the inherent tension between our immediate diplomatic political priorities and our long-term development goals. And as we look at the QDDR and all the discussions around the QDDR, we’ve been very comforted and pleased by the recognition of the need for synergy in a resource-constrained world using our dollars as well as possible. So we’re very confident that that’s going to emerge from the document and from its execution.

The question I have is really around what President Kennedy was thinking about: Does it also recognize the inherent tensions that we face in a resource-constrained world when you can’t do everything with your dollars? I’m sure we’re going to be working years from now in contexts where we both need to achieve immediate economic growth in those contexts, which might be a political imperative, and to make that economic growth as inclusive and broad based as possible, which is more of the developmental imperative. And you’ll do different programs and fund different projects when you have either one in mind.

So are you confident that the QDDR and the execution of the QDDR will do enough to recognize that inherent tension and, while we find the synergies, also resolve those tensions in a way that will honor both our diplomatic goals and our longer-term development goals?

SECRETARY CLINTON: Well, first, let me thank Oxfam for the tremendous work that you do around the world, and we are happy to partner with you in so many difficult and dangerous settings.

You’ve accurately described the tension, and I don’t think there is any way to resolve it. It is not going to disappear, but it can be diminished. And part of the way we hope to diminish it is by being tough evaluators of what we are doing and the results from both our diplomatic and development efforts, because lots of times the tension arises because there is no recognition about the common goal we are seeking. And there is often an impatience to get something short term done at the detriment of the long term, or a frustration that the long term – in the long term, we’ll all be dead and we’re not getting anything done in the short term. So I am well aware of the tension and the absolute healthy debate that this tension represents.

This QDDR is coming at an appropriate time because we are also working with the international community to do a better job of outlining evaluative metrics and measurements and models for what works in development. As you know, DFID is having its own internal review. There will be a global meeting about development in Seoul at the end of 2011. So everyone is facing the same set of questions: In a resource-constrained world, how do we proceed on both tracks simultaneously? We want to stabilize. We want to create the conditions for economic growth. We want it to be inclusive. We want democracy and good governance to improve. And some days, the balance may tip one way or the other. But what we’re trying to do is to keep in mind that tension and try to figure out the best ways moving forward.

It is something we spent a lot of time talking about. We’ve got a perfect example in Haiti right now. We have a dreadful humanitarian crisis with the cholera epidemic that the world is attempting to help Haiti deal with. I’m very proud of the work that CDC, AID, and everybody is doing on the ground. We have the continuing suffering and instability caused by the failure to get enough done since the earthquake to relieve that. And we now have an electoral crisis. So which do you address first? I think that’s a perfect example. If you ignore the legitimate questions raised about the election, you create conditions for longer-term instability. If you don’t continue to provide assistance on the humanitarian side while you try to deal with the questions posed by the election, then you hurt the people you’re trying to help. I mean, so we are well aware of the tensions, the trade-offs, the difficulties, and part of what the QDDR is attempting to do is to better lay out what we expect from ourselves.

And so as we address these inherent tensions, we have a clearer organizational and operational understanding of what we’re capable of doing and what we’re not. Because I think it’s also important to say that the United States cannot wave some magic wand and solve these problems by focusing on either development or diplomacy. We can’t do it alone. The world can’t do it without us. And so my goal is to make sure that this QDDR represents our best efforts at addressing these very difficult challenges.

UNDER SECRETARY KENNEDY: Before I take the next question -- (applause) –

SECRETARY CLINTON: One more? One more? One more. Okay, one more.

UNDER SECRETARY KENNEDY: One more. Is the field ready? No. Sir.

QUESTION: Madam Secretary, my name is Zachary Teich. I am a retired Foreign Service Officer. I currently work in nonproliferation. I’m curious how you’re going to extend the QDDR approach to the other civilian agencies of government. We have at least three foreign services that are not represented here today – the Agricultural Department’s Foreign Agricultural Service, the Commerce Department’s Foreign and Commercial Service, and then, of course, there is the intelligence community. Each of these has a separate legislative mandate. Each of them cooperates in a country team exercise overseas. But each has a separate mission, and it’s very difficult to tell them – just because the ambassador has the authority to do so – that they’re going to do something beyond that legislative mandate. So I’m very curious to hear your views on how we will get the other agencies on board in this approach.

SECRETARY CLINTON: I’m going to let Anne-Marie start.

DR. SLAUGHTER: Well, the first thing I would say is through this process we actually embodied what we’re aiming to achieve in the sense that I think for the first time ever, the Department of Agriculture, and certainly the USTR, the intelligence community, all had extensive comments on what we were proposing, precisely to put input into what do we mean by chief of mission authority of a multiagency mission. How is that going to work going forward? We’ve spent a month working with other agencies, pages and pages of comments, precisely to work that out in a way that they can sign off on so that we go forward. So I would begin by saying this is –this process is the beginning of that different way of working together.

SECRETARY CLINTON: I think your question is a very important one, and a lot will depend upon getting the buy-in, changing the mindset. But I think as we look out across the government – and having served for eight years in the Senate, I have something of an idea of the political debate that we will have around budgets – and it will be very difficult for all of these agencies, including ours, to continue doing what we have done without getting efficiencies, without being smarter about delivering on whatever their statutory mandate might be.

So the timing on this is, I believe, fortuitous because, as Anne-Marie said, we’ve worked really hard to take into account everyone’s concerns. But we’ve got to have somebody in each country who actually speaks for the entire government. We’ve had examples – and I see some heads nodding – where you have contradictions about American policy between the presence of intel personnel, DOD personnel, State, USAID, et cetera, et cetera, et cetera. And we can’t afford that. We have to work out whatever differences there are among the United States Government representatives behind closed doors and, under chief of mission authority, present a unified front.

Otherwise, as we now know, it’s not the world of 10 years ago, let alone 50 or 100 years ago. Everybody is a potential source. Everyone is a potential blogger. Everyone is a potential leaker. (Laughter.) And therefore it would be, I think, beneficial for American foreign policy if we demonstrated as strong a presence as possible in a country after having worked through all the various and sundry jurisdictional turf problems that we know exist. This is a work in progress. It’s not going to happen overnight. But we have had enough examples in the past whereas if we don’t have that unified U.S. Government position, we are working at cross-purposes to our own ends, and that is just not going to cut it in the 21st century.

So we are pressing very hard on one of the key ideas which I mentioned in my remarks: Our ambassadors and chiefs of mission are truly the CEO of the American presence, and that includes everybody. We feel that way about the military’s CINCs. If you’re a regional commander in the United States military and you are going to be operating in a country in your region, the ambassador in that country needs to know and needs to approve. And we feel that that has to be the way we proceed, and I’m looking forward to the many challenges of implementation that that presents. (Laughter and applause.)

UNDER SECRETARY KENNEDY: Okay. Since the Secretary stayed much longer than was anticipated, thank you all very much for coming. You can find the full text of the QDDR on the website, the State Department website, this afternoon. And also, a reminder that on the Secretary’s Sounding Board, you will be able to find a location to post specific questions that you might have about the QDDR and you will get answers. Thank you all very much. (Applause.)