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Dear Board of Directors,

This past week was dubbed by the press “Season 2: New Players”. At first it brings a chuckle – and then it got worrisome when replacement names began to circulate for National Security Advisor – like John Bolton.

So let me share a few private thoughts.

1. The Tectonic Shifts at State Department. Our public statement set out to “hug” Mr. Pompeo for his baseline support for development and diplomacy, and our hope is that he will return some normalcy to Foggy Bottom by embracing the core mission of State/USAID. But at the same time, we should be prepared for whiplash when it comes to management and policy.


* On Management:
* Let’s face it – Secretary Tillerson never embraced the enterprise. Other than two bookend speeches – the one he gave the first day he entered the building and his final emotional farewell press conference – he just didn’t stick up for the professionals at Foggy Bottom. He led an effort to dismantle the Department that demoralized the institution and will live on well past his tenure.
* Hopefully, Pompeo quickly commits to filling key leadership posts and diminish his focus on the “redesign” effort. He is known for empowering his team and as Josh Rogin’s column said in the Post, “Pompeo can make the State Department great again.”

* On Policy:
* Tillerson was a moderating voice, along with Mattis, against some of the president’s most isolationist and protectionist instincts – certainly part of the reason he was let go. Regardless, it appears that much of the national security apparatus is thrilled that he is out.
* In contrast, as we know, Pompeo is far more aligned with the president’s America First foreign policy and that will have ramifications on a range of issues – from relations to NATO allies to NAFTA to family planning to the Iran deal. While USGLC does not take positions on these or other issues, we could see a shift on how the U.S. relates to our allies and this could impact some of our coalition members.

* An Idea – The “Ray Washburne Opportunity”:
* Ray Washburne didn’t know anything about OPIC before he arrived, but he is close to POTUS. He has leveraged this relationship to empower OPIC.
* Now imagine if Pompeo enters Foggy Bottom and decides to “own it”, just like Ray did at OPIC. Imagine that Pompeo truly feels like State and USAID are his “kingdom” and wants to protect them (unlike Tillerson).
* If that were to happen, then Pompeo could use his the relationship with the “King”, and protect State and USAID.
* I may be dreaming, but this will be a strategy that we should discuss at our May board meeting.

2. A Nikki Haley Concern? Hope not. A few updates:


* First, the toxic relationship between Ambassador Haley and Secretary Tillerson was an open secret, and she could not have been more vocal in welcoming Pompeo’s nomination (and not even mentioning Tillerson), tweeting “Congratulations to my friend and soon to be Secretary of State Mike Pompeo! Great decision by the President.”

* Haley’s victory lap on Pompeo and her statements on Russia in the Security Council have reaffirmed her influence inside the Administration. But now I am worried about what she is doing on foreign assistance.

* As you know, after many countries voted against the U.S. in a non-binding UN resolution on the U.S. embassy move to Jerusalem, Haley began making the case that UN votes should be the condition for US foreign assistance and worked to get a very aggressive line into the State of the Union.

* During her AIPAC speech, she softened her rhetoric saying that a UN vote should not be the only factor, but “one factor” to determine our foreign assistance and we know she is working on an op-ed to outline her views on foreign assistance.

* However, at the end of last week, Foreign Policy<http://foreignpolicy.com/2018/03/15/haley-vote-with-u-s-at-u-n-or-well-cut-your-aid/> scooped a very concerning internal USUN memo on conditioning U.S. foreign assistance for UN votes. The confidential report would propose a “sweeping reassessment of U.S. foreign assistance.” While there is no question that support at the UN for U.S. positions is an important part of determining America’s interest, the document, as reported, is shortsighted with its limited view of U.S. strategic interests.

* While she has demonstrated extraordinary leadership on humanitarian aid, we’re concerned about this growing narrative and are working hard to help broaden and educate her and her team.

3. Capitol Hill Stakes. With so much noise, a few things to share:


* I was on the Hill this week with nearly 20 of our three and four-star military leaders. They are so impressive! We saw everyone from Senator Tom Cotton (who gave us advice on how to engage the president) to several Freedom Caucus members. When we sat down with the Youngstown Rep. Tim Ryan (D-OH) – who ran against Speaker Nancy Pelosi and has already visited Iowa and New Hampshire five times – he was blown away when we told him about our 30,000 veterans.

* On Pompeo, Senator Corker was quick to suggest an early April confirmation hearing for the nominee, but based on my conversations with senior Republican senators this week – many are envisioning a prolonged process to get his confirmation across the finish line.
* Rand Paul has already announced his opposition, and there are no SFRC Democrats facing significantly tough 2018 races back home.
* In the full Senate – with McCain and Cochran potentially out – the Republicans could only have 49 votes including Pence.
* It will be interesting to see how much the ticking clock around the potential North Korea Summit impacts private pre-hearing meetings and his confirmation timeline.


* On the staffing front, we know that Pompeo was only allowed a small cadre of political staff at the CIA, so we’re hoping that he will bring to State some of his former congressional staff like Jim Richardson, Reagan Thompson, and Toni Porter who we have built strong relationships with.
* The good news is that Margaret Peterlin and Christine Ciccone have already announced their resignations – both were deeply unpopular and had been a difficult audience for us. And it looks like Brian Hook – who just led the U.S. delegation to Vienna on the Iran Deal – could be sticking around (at least for now).


* Lastly – while McMaster has largely been agnostic on our core budget and personnel issues, he certainly has been a voice to push back against isolationist impulses. When and if he leaves, the position could be filled with a wonderful friend like Ford Motor’s Steve Beigun or a nemesis like John Bolton. Let us hope.

In a separate note, I will share some details on the really interesting meetings we’re having with candidates running for the Senate that have been backed by Rand Paul and Steve Bannon and how we’re winning them over.

Enjoy the rest of the weekend.

Liz
Liz Schrayer, USGLC