FOREIGN RELATIONS AUTHORIZATION ACT FISCAL YEARS 1984 AND 1985 REPORT OF THE COMMITTEE ON FOREIGN RELATIONS UNITES STATES SENATE ON S. 1342

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP95B00895R000300030024-4
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 8
• Document Creation Date: December 21, 2016
• Document Release Date: November 20, 2008
• Sequence Number: 24
• Publication Date: May 23, 1983
• Content Type: REPORT

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Calendar No. 220
98TH CONGRESS
1st Session
REPORT No.
1 98-143
FOREIGN RELATIONS AUTHORIZATION ACT
FISCAL YEARS 1984 AND 1985
REPORT
COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE
S. 1342
TO AUTHORIZE APPROPRIATIONS FOR THE DEPARTMENT OF
STATE, THE UNITED STATES INFORMATION AGENCY, THE
BOARD FOR INTERNATIONAL BROADCASTING, THE NATIONAL
ENDOWMENT FOR DEMOCRACY AND THE ASIA FOUNDATION
FOR FISCAL YEARS 1984 AND 1985
U.S. GOVERNMENT PRINTING OFFICE
20-7640 WASHINGTON : 1983
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 AND SURVIVING SPOUSES
~ RADIO LIBERTY INCORPO-
y Senator Percy, creates
Fund composed of gains
ince the pensions of em-
ss that retired prior to
prove the low and inad-
Free Europe and Radio
.976. Aside from a lower
ar-paid pre-1976 retirees
deducted from their al-
y check of man of these
ind is in the $200-$300
)re-1976 retirees receive
tances of this group is
iivalent cost of living in-
o living conditions often
- ly talented individuals,
oviet controlled East Eu-
us in the countries from
munism. Their dedicated
,iberty became the very
ios into the highly effec-
'hese people served well
idered a great service in
n their home countries.
ir better treatment than
ving. They are a small
appropriate pension im-
exists, without requiring
melioration and at least
suffered by these proud
ancial straits. It now ap-
ge rate vs. The deutsch
in the fiscal year 1983
not fully, fund the re-
iost acute shortfalls suf-
3 RFE/RL retirees. This
yen the pre-1976 and the
For widows now receiving
for the 50 percent social
npaid cost of living in-
cost of such a relatively
in the neighborhood of
nge savings for the first
timated to have already
e not available for use by
authorized by the Con-
and thus greatly relieve
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the tragic plight of these people. This section creates a fund for
that purpose.
SECTION 401. SHORT TITLE -
This section provides a short title of "National Endowment for
Democracy Act" for the provisions of this bill. This legislation is a
response to the felt need to increase the U.S. public diplomacy
effort overseas in a manner which involves U.S. private sector ini-
tiatives to strengthen democratic values and institutions abroad.
Over the past 40 years, the United States has been committed to
the goals of democratic institution-building abroad. During this
same period, the Congress, under both Democratic and Republican
leadership, has supported and helped to shape the national consen-
sus in favor of such initiatives. From the earliest days of the Mar-
shall plan, "Point 4" economic assistance, the advent of interna-
tional broadcasting as an element of public diplomacy, and govern-
ment-supported exchange programs such as those authorized by the
Fulbright-Hays Act, several themes have recurred.
Such initiatives reflected concretely the underlying national con-
sensus on broad U.S. foreign policy goals. Second, the new program
did not threaten to undermine either by accident or design the
funding and operations of other existing popularly supported pro-
grams. Third, the new programs enjoyed genuine bipartisan sup-
port across a wide spectrum of American leadership opinion. The
programs funded by the National Endowment for Democracy are
intended to reflect these criteria.
This new proposal is the result of a 6-month nongovernmental
research study by the two major U.S. political parties, labor, and
business involving Democrats, Republicans, liberals, moderates and
conservatives to design new, private sector approaches which will
foster and strengthen democratic values and institutions abroad.
Named the Democracy Program, this study was often confused
with the Reagan Administration's $65 million proposal for a
"Project Democracy," discussed in Title II above, whose broad pur-
poses are to enhance and increase existing public diplomacy pro-
grams of the U.S. Government, and to develop new governmental
initiatives, promote democracy and democratic institution-building
overseas.
Private sector efforts in the past have been fruitful, except for
the AFL-CIO's regional institutes and a range of programs spon-
sored by leading foundations and private voluntary organizations.
Indeed, for several decades, the AFL-CIO has been running region-
al institutes in Latin America, Africa and Asia, often working
under difficult local circumstances in nondemocratic societies to
support democratic trade unions and train their organizers. Since
World War II, the American labor movement has also been active
in efforts to support democratic workers' movements, first in West-
ern Europe when threatened by Communist disruptions in the
bleak aftermath of the war, and most recently in Eastern Europe
with its assistance to Poland's Solidarity movement.
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54
Nonetheless, there has never been a comprehensive structure for
a nongovernmental effort through which the resources of Ameri-
ca's private sector constituencies, the separate and autonomous
programs of energetic institutions, could be mobilized effectively.
Those involved in the Democracy Program recognized from the be-
ginning that to be effective, such a structure should have the in-
volvement of both national political parties, organized labor and
the business community, among other private institutions.
Nor was the Democracy Program first to recognize problem
Eisen-
or pioneer in creating solutions. During the 1950'x President ,
hower, SeDators J. William Fulbright and Hubert H. Humphrey,
and leaders of the American labor movement, such as George
Meany and Walter Reuther, proposed and developed mechanisms
to assist democratic institutional development abroad openly and
through the private sector.
A decade later, during the months that followed the public rev-
elation in 1967 of the CIA's covert funding of overseas Johnson Ad-
ministration American private voluntary organizations, the ministration concluded after careful study that the U.S. Govern-
ment should totally halt all secret financial subsidies to such non-
governmental groups. At the same time, Johnson officials urged
the creation of a new, quasi-autonomous nongovernmental organi-
zation to provide public funds openly for the overseas activities of
American private sector groups engaged in worthwhile internation-
al programs. Anticipating the Johnson proposals, a number of
House members, led by Hon. Dante B. Fascell, introduced in April
1967 a bill to create an Institute of International Affairs. Unfortu-
nately, concern over the problem of past covert funding overrode
sufficient interest in constructive future solutions beyond terminat-
ing all CIA involvement.
Events and institutions in Europe triggered new interest in the
possibility of a nongovernmental democracy program during the
late 1970's. Americans became committed to participating in the
process of monitoring the Helsinki Accords, especially in human
rights ("Basket Three") provisions as these affected Soviet bloc be-
havior. This concern led not only to the creation of the bipartisan
Commission on Security and Cooperation in Europe but also to leg-
islation introduced in 1978 to establish an "Institute on Human
Rights and Freedoms" (among other bills introduced on similar
themes).
Independently, during this same period a number of American
political leaders became intrigued by the activities of the German
"stiftungen"-the political foundations which now collectively re-
ceive over $150 million annually from the German Bundestag.
These four publicly funded foundations in the Federal Republic of
Germany are each allied to a major political party. Today, these
foundations sponsor efforts in over five dozen countries to encour-
age the institutional development vital to the emergence of plural-
ist cultures. The work undertaken by the Konrad Adenauer (CDU),
Friedrich Ebert (SPD), Friedrich Naumann (FDU), and Hans Seidel
(CSU) foundations has been so effective that the idea of party foun-
dations has spread to countries as diverse as Spain (which recently
created its own political foundations after witnessing the helpful
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I
rehensive structure for,
ke resources of Ameri-
irate and autonomous
mobilized effectively.
ecognized from the be-
re should have the in-
3, organized labor and
e institutions.
recognize the problem
1950's, President Eisen-
Hubert H. Humphrey,
rnent, such as George
developed mechanisms
ent abroad openly and
ollowed the public rev-
)f overseas activities by
tions, the Johnson Ad-
that the U.S. Govern-
subsidies to such non-
lohnson officials urged
)ngovernmental organi-
se overseas activities of
worthwhile internation-
roposals, a number of
ell, introduced in April
tional Affairs. Unfortu-
:overt funding overrode
utions beyond terminat-
red new interest in the
cy program during the
to participating in the
Is, especially in human
affected Soviet bloc be-
eation of the bipartisan
L Europe but also to leg-
i "Institute on Human
introduced on similar
a number of American
activities of the German
ich now collectively re-
he German Bundestag.
the Federal Republic of
ical party. Today, these
zen countries to encour-
the emergence of plural-
Conrad Adenauer (CDU),
(FDU), and Hans Seidel
it the idea of party foun-
as Spain (which recently
r witnessing the helpful
role played by the German foundations in sustaining Spanish de-
mocracy), Portugal, Venezuela and the United States.
Similarly, the American labor movement was taking stock of the
effects of United States withdrawal from the International Labor
Organization (ILO) in 1977. AFL-CIO leaders renewed their lon--
standing interest in the possibility of expanding the Federation s
international work. They explored the possibility of.a legislatively-
created labor foundation that could disburse public-funds to its ex-
isting institutes and other organizations doing labor-supported in-
ternational work.
A number of these interests came together in the spring of 1982
to produce a critical mass of public attention. A study was proposed
in a letter to the President by the bipartisan American Political
Foundation and the Democratic and Republican Party chairmen to
determine ways and means for promoting the growth of democracy
and democratic institutions. The letter referred specifically to the
German party foundations' "open and effective prorams to sup-
port democratic political forces throughout the world,' and suggest-
ed that the study, which would be conducted under the auspices of
the bipartisan American Political Foundation, "take up such ques-
tions as whether programs should be bipartisan, what, if any,
should be the connection with the government, how to handle the
tension between maintaining friendly relations with current gov-
ernments while sowing the seeds of democratic successors, how to
encourage domestic pluralistic forces in totalitarian countries, and
what levels of resources are required."
President Reagan devoted space to the research study in his
June 1982 address to the British Parliament. His comments at-
tracted favorable reactions. Such reservations as emerged centered
upon three issues: Concern lest the programs proposed be other than
long-range and bipartisan in scope; anxiety that the Administration
would attempt to exploit the research study for immediate prop-
aganda purposes in its broader public diplomacy initiatives; and op-
position to a dominant political tilt in defining the context and reci-
pients of democratic political assistance. The subsequent recommen-
dations of the Democracy Program study put these fears to rest.
During the summer and fall of 1982, considerable time and
energy was devoted to arranging the delicate balance of political
and institutional interests within the structure of the research
study, in close consultation with the leadership of the two major
political parties and the leaders of the AFL-CIO and the U.S.
Chamber of Commerce. In the late fall, the Democracy Program
study was officially launched with the announcement of a biparti-
san executive board and program director. A staff and initial
consultants were selected who were broadly representative of the
areas of scholarly expertise and political balance required by the
study, including representatives of the Democratic Party, the Re-
publican Party, labor and business programs.
Subsequently, the report of the Democracy Program entitled
"The Commitment to Democracy: A Bipartisan Approach" was
issued. Its recommendations are reflected in this title. Among the
functions envisioned for the Endowment are the following: (a) to
perform general oversight functions relating to its activities to
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56
insure that the charter's purposes are being met; (b) to evaluate
grant proposals from the private sector and to support the collabo-
rative efforts of private sector grantees to design programs which
combine their experience and institutional perspectives; (c) to pro-
f
vide scholarships and fellowships
rog programs desi ed out the to teach democrat
the Endowment and support p P
is concepts; (d) to serve as the "umbrella ' organization through
which the four party, labor and business instrumentalities, enu-
merated in section 411, may receive funding (in addition to those
amounts already earmarked) and within which each one can evolve
independently but in a cooperative and collaborative manner; (e) to
serve as an intermediary between private sector groups and as a
clearinghouse for inquiries and f unities for odemocratic rder to bring sisgtances
together and to create new opp
SECTION 402. ESTABLISHMENT NATIONAL ENDOWMENT FOR
DEMOCRACY
Section 402(a) authorizes the establishment of a private, nonprof-
it corporation called the National Endowment for Democracy.
Section 402(b) provides that the Endowment will not be consid-
ered an agency or establishment of the U.S. Government.
Section 402(c) provides that the Endowment will be subject to the
provisions of this title. In addition, to the extent consistent with
this title, the Endowment will also be subject to the District of Co-
lumbia Nonprofit Corporation Act.
Section 402(d) provides that the principal offices of the Endow-
ment shall be located in the District of Columbia.
SECTION 403. PURPOSES OF THE ENDOWMENT
Section 403(a) outlines the purposes of the Endowment, thus de-
fining the parameters of its activities.
Section 403(aXl) describes the broad purpose of the Endowment,
which is to use private sector initiatives to encourage free and
democratic institutions worldwide. This specifically includes activi-
ties which promote individual rights and freedoms.
Section 403(a)(2) outlines one of the major methods which will be
used by private sector groups carrying out the purposes of the En-
dowment. The section contemplates the use of exchanges between
U.S. private sector groups and democratic groups abroad in order
to carry out the purposes of the Endowment. Among the private
sector groups which will be involved in such exchanges are the
Democratic and Republican parties and U.S. labor and business
group.
Section 403(ax3) provides for the promotion of U.S. nongovern-
mental participation generally in domocratic training programs
and democratic institution-building abroad. Particular mention is
made of the major U.S. political parties, labor and business, as well
as other private sector groups.
Section 403(aX4) enunciates the purpose of strengthening demo-
cratic electoral processes abroad in cooperation with democratic
groups in given country. This arrangement would involve agree-
ment between the relevant groups in the United States and in the
host country.
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met; (b) to evaluate
support the collabo-
sign programs which
rspectives; (c) to pro-
r out the purposes of
d to teach democrat-
organization through
strumentalities, enu-
(in addition to those
z each one can evolve
)rative manner; (e) to
ctor groups and as a
)rder to bring groups
lemocratic assistance.
of a private, nonprof-
for Democracy.
It will not be consid-
overnment.
will be subject to the
xtent consistent with
to the District of Co-
offices of the Endow-
bia.
)OWMENT
Endowment, thus de-
,e of the Endowment,
) encourage free and
fically includes activi-
loms.
nethods which will be
e purposes of the En-
of exchanges between
?oups abroad in order
t. Among the private
h exchanges are the
. labor and business
n of U.S. nongovern-
ic training programs
Particular mention is
and business, as well
strengthening demo-
tion with democratic
would involve agree-
ited States and in the
Section 403(aX5) states as a purpose of the Endowment support
for the participation of the major political parties, labor, business
and other U.S. private sector groups to foster cooperation with
groups abroad dedicated to the cultural values, institutions and or-
ganizations of democratic pluralism.
Section 403(aX6) states that the activities of the Endowment in
encouraging the establishment and growth of democratic develop-
ment are to be consistent with broad U.S. national,, interests and
with the requirements of democratic groups abroad assisted by pro-
grams funded by the Endowment.
Section 403(bXl) states specifically that the Endowment will pro-
vide funds for programs, but will not actually run programs itself.
Section 403(bX2) states that funding will only be provided for pro-
grams meeting the purposes of the Endowment.
Section 403(bX3) provides that the Endowment and its grantees
will be subject to the oversight procedures of the Congress.
SECTION 404. INCORPORATION OF THE ENDOWMENT
Section 404(a) sets forth the 15 initial incorporators of the En-
dowment. These individuals will take the steps necessary to incor-
porate the National Endowment for Democracy under the District
of Columbia Nonprofit Corporation Act. This includes drafting of
the articles of incorporation and the bylaws, which will reflect the
provisions of this title. The listed incorporators represent a cross-
section of Americans active in business, labor, the major political
parties and with expertise in foreign policy law and the like. Sec-
tion 404(b) provides that the Honorable Dahte B. Fascell shall serve
as Chairman of the incorporators and interim Chairman of the En-
dowment until such time as a Chairman is elected under bylaws of
the Endowment. It is expected that, during the pendency of the in-
terim chairman, no funds will be disbursed by the Endowment.
SECTION 405. BOARD OF DIRECTORS
Section 405(a) provides that the Endowment will be governed by
a 15-member Board of Directors. Following the initial incorporation
period, when the Board will consist of those individuals set forth in
section 404 above, the Board will be self-perpetuating and elected
in accordance with the Endowment's bylaws.
Section 405(b) provides that vacancies in the Board's membership
shall not affect its powers. This provision reflects common practice.
Section 405(c) states that members of the Board shall not be
deemed to be officers or employees of the United States. The sec-
tion provides for per diem for the Board members while performing
their duties.
SECTION 406. OFFICERS OF THE ENDOWMENT
Section 406(a) provides that the chief executive officer of the En-
dowment shall be a President appointed by the Board. The Presi-
dent will carry out the daily operations of the Board, and will
report to the Board under appropriate guidelines and procedures.
Section 406(b) provides for staff of Endowment. The number and
type will be determined by the Board.
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58
Section 406(c) provides that the terms of officers of the Endow-
ment will be set by the Board.
Section 406(d) prohibits officers of the Endowment from receiving
compensation from any source other than the Endowment during
the period of their employment by the Endowment.
SECTION 407. NONPROFIT NATURE OF THE ENDOWMENT
Section 407(a), precludes the Endowment from issuing stock or
paying dividends. This reflects the nonprofit character of the En-
dowment.
Section 407(b) prohibits any Board member, officer or employee
of the Endowment from gaining any personal benefit from the cor-
porate assets of the Endowment, other than from duly authorized
compensation.
ENDOWMENT AND THE
SECTION 408. RECORDS AND AUDIT OF ASSISTANCE
RECIPIENTS
Section 408 provides for normal auditing procedures for the En-
dowment and its grantees. regular annual audits of the Endow-
ment 408(aXl) provides for rment by independent auditors. The section requires that all appro-
priate 408(aX2) requires qthat Section 408(aX2) independent audits are to be
included in the annual report required by section 409 below. It fur-
present a scope
complete audit
ther
necessary to forth
any other hstatements audit
picture.
Section 408(b)(1) permits the financial transactions of the Endow-
ment to be audited annually by the General Accounting The
section also provides for appropriate access by
the General Accounting Office to materials necessary to the audits.
Section 408(b)(2) requires that the Comptroller General's audit
report be sent to the Congress. It may contain such comments and
information as the Comptroller General deems necessary to explain
the audit. In addition, the report is required to discuss any transac-
tion which, in the opinion of the Comptroller General, has been
conducted without legal authority. The section also provides that
copies of the audit report be sent to the President and to the En-
dowment when the report is submitted to the Congress.
Section 408(cXl) provides that grantees of the Endowment must
keep records appropriate to the conduct of an audit.
the Endowment or its duly au
t
o
Section 408(c)(2) provides access
thorized representatives (such as an independent auditor) for the
purpose of auditing the records of the grantees. The same access is
authorized for the Comptroller General of the United States or his
or her duly authorized representatives.
SECTION 409. REPORT TO THE CONGRESS
Section 409 provides for an annual report by the Endowment en to
31 of
the Congress. The report shall be submitted by December
each year and shall include a comprehensive and detailed report of
the Endowment's activities, operations, finances and accomplish-
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 f officers of the Endow-
dowment from receiving
the Endowment during
)wment.
THE ENDOWMENT
it from issuing stock or
)fit character of the En-
iber, officer or employee
nal benefit from the cor-
an from duly authorized
ENDOWMENT AND THE
NCE
g procedures for the En-
iual audits of the Endow-
s requires that all appro-
audit.
pendent audits are to be
section 409 below. It fur-
?th the scope of the audit
)resent a complete audit
?ansactions of the Endow-
al Accounting Office. The
ess by representatives of
~s necessary to the audits.
nptroller General's audit
itain such comments and
ems necessary to explain
ed to discuss any transac-
,roller General, has been
section also provides that
President and to the En-
the Congress.
of the Endowment must
I an audit.
i ndowment or its duly au-
ependent auditor) for the
intees. The same access is
f the United States or his
E CONGRESS
sort by the Endowment to
iitted by December 31 of
sive and detailed report of
finances and accomplish-
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59
ments, together with any recommendations the Endowment deems
appropriate. The section further requires the Board members and
officers of the Endowment to be available to testify before appropri-
ate congressional committees.
SECTION 410. FUNDING FOR THE ENDOWMENT
Section 410 provides the funding mechanism for the Endowment.
Subsection (a) provides authority for the Director of the U.S. Infor-
mation Agency to, make grants to the Endowment from the "Sala-
ries and Expenses" account of the agency. Subsection (b) permits
the Endowment to use such funds for the purposes of the Endow-
ment without regard to any limitation or guidelines normally im-
posed by USIA for its grant-making activities.
SECTION 411. ALLOCATION OF FUNDS
Section 411 earmarks specific amounts of money in fiscal years
1984 and 1985 for certain grantees of the Endowment. These in-
clude not less than $5 million for each of the 2 fiscal years for the
National Democratic Institute for International Affairs; not less
than $5 million for each of the 2 fiscal years for the National Re-
publican Institute for International Affairs; not less than
$13,800,000 for the Free Trade Union Institute; and not less than
$2,500,000 for support of the private enterprise development pro-
grams of the National Chamber Foundation.
TITLE V-FOREIGN MISSIONS AMENDMENTS ACT OF 1983
SECTION 501
This title may be cited as the "Foreign Missions Amendments
Act of 1983."
SECTION 502
The Diplomatic Relations Act of 1978 (Public Law 95-393) re-
quires all foreign missions, members of missions and their families
and officials of the United Nations entitled to diplomatic immunity
to carry liability insurance against risks arising from their oper-
ation of motor vehicles, vessels or aircraft in the United States.
Although there has been substantial compliance with the re-
quirements of the Act by the diplomatic community, there have
been instances where diplomats have allowed their insurance poli-
cies to lapse.
The purpose of this title, introduced as an amendment by Sena-
tor Sarbanes, is to assure that all U.S. citizens who are injured by
the negligence of an individual with diplomatic immunity, will
have an opportunity to recover compensation for their damages.
This section transfers the responsibility for implementing the
Act from the Protocol Office to the Office of Foreign Missions. Lia-
bility insurance is a reciprocity issue. All U.S. diplomats are re-
quired to carry such insurance. All foreign diplomats in the United
States should do the same. It is the Committee's view that the
Office of Foreign Missions is a more appropriate place to carry out
the responsibilities of the Diplomatic Relations Act.