The 100th Congress Convenes

By Dennis J. Wamsted

Iran Arms Investigations

The 100th Congress officially convened Tuesday, January 6, 1987, under full Democratic control for the first time since President Ronald Reagan assumed office in 1981. Following the transfer of power from Robert Dole (R-KS) to Robert Byrd (D-WV), the new Majority Leader, one of the Senate's first official acts was the creation of an 11-member select committee to investigate the Iran arms sale scandal. The Senate voted 88 to 4 to authorize the panel, which will be chaired by Daniel Inouye (D-HI)—one of the most outspoken supporters of Israel in the current Congress. In the authorizing language, the Senate set August 1, 1987, as the target date to issue the panel's findings. This can be postponed until October 30, 1987, however, if a majority of the Senate, now controlled 55 to 45 by the Democrats, decides that more time is necessary to complete the investigation.

The House, by a 416 to 2 margin, passed a similar resolution one day later to create its 15-member select committee chaired by Rep. Lee Hamilton (D-IN) to investigate the Iran-contra scandal. It set an October 30, 1987 completion date for its investigation. Rep. William Broomfield (R-MI), ranking minority member on the House Foreign Affairs Committee and the second-ranking minority member on the newly-created investigative panel, urged the panel to complete its work "by April and not drag our feet until October." House sources said, however, that the panel probably would not even begin work until some time in February.

The 100th's New Committees

Other organizational concerns dominated the first sessions of the new Congress. In the Senate, a battle erupted between former Senate Foreign Relations chairman Richard Lugar (R-IN) and Senator Jesse Helms (R-NC) over who should become that panel's new ranking minority leader. Helms claimed that as the senior Republican member of the panel, he deserved the position. [In 1984, following the electoral defeat of former Committee chairman Charles Percy (R-IL), Helms became the ranking Republican member on both the Agriculture and Foreign Relations committees. Fulfilling a promise he had made that year during his reelection campaign, Helms assumed the chairmanship of the Agriculture Committee and allowed Lugar to become chairman of the Foreign Relations panel.]

Lugar argued that seniority alone should not determine the ranking member of a committee. The Indiana senator's contention, which could have important long-range implications for the Senate as a whole, was supported 7-0 by his fellow panel members. Helms and Senator Rudy Boschwitz (R-MN) did not vote. Helms, maintaining that the sanctity of the Senate seniority system was at stake, brought up the measure for consideration by the entire 45-member Senate Republican Conference.

This uncertainty slowed selection of Republican committee members and formation of the various subcommittees, including the subcommittee on Near Eastern and South Asian Affairs. The committee's new makeup consists of 11 Democrats and nine Republicans. [It was 9-to-8 in the Republican-controlled 99th Senate.] New members of the committee include:

1) Paul Simon (D-IL);
2) Terry Sanford (D-NC);
3) Brock Adams (D-WA);
4) Daniel Patrick Moynihan (D-NY); and
5) Mitch McConnell (R-KY).

The only Democratic change on the House Foreign Affairs Committee's subcommittee on Europe and the Middle East, which will still have an 8-to-5 Democratic majority, is the addition of freshman Congressman Wayne Owens (D-UT) to replace Harry Reid (Nevada's newly elected senator). Indiana's Hamilton will return as the panel's chairman.

The House Appropriations Committee's Foreign Operations subcommittee will have exactly the same make-up as it did in the 99th Congress. [David Obey (D-WI) is serving as chairman. Jack Kemp (R-NY) is the ranking minority member.] The new Senate Foreign Operations Committee subcommittee chairman is Hawaii's Inouye; Robert Kasten (R-WI), committed chairman in the 99th Congress, becomes the ranking minority member. This subcommittee, with a ratio of seven Democrats to six Republicans, includes all of those senators on the panel last year and the following newcomers:

1) Frank Lautenberg (D-NJ);
2) Tom Harkin (D-IA);
3) Barbara Mikulski (D-MD); and
4) Don Nickles (R-OK).

Reagan's Foreign Aid Budget

On January 5, 1987, President Reagan submitted his budget proposals for fiscal year (FY) 1988. These proposals, as with his previous submissions, sparked an immediate outpouring of congressional opposition, led by Republican minority leader Dole, who said: "I don't think the budget has a prayer. I think it's a starting point; that's about all that can be said for it."

Among the controversial issues this year will be the administration's foreign aid proposals for fiscal 1988. In its recently submitted budget, the administration asked for an overall foreign aid and bilateral assistance budget of $15.2 billion for FY '88, up $1.7 billion from the FY '87 appropriation. Of this total, approximately $5.8 billion is in military aid, including $4.4 billion in foreign military sales (FMS) credits, $1.3 billion in military assistance program funds (MAP) and some $3.6 billion in economic support funds (ESF).

Not surprisingly, Israel and Egypt garnered the bulk of the administration's requests for FMS and ESF monies. As in FY '87, the administration is requesting $1.8 billion in FMS and $1.2 billion in ESF funds for Israel, a total of $3 billion. Egypt is slated to received $1.3 billion in FMS and $815 million in ESF funds, for a total of $2,115,000,000. Other big winners in the foreign aid sweepstakes include: Turkey with about $615 million in military and ESF aid and Pakistan with some $562 million in overall aid.

Administration Proposes Changes in FMS Program

In a significant departure from past policy, the administration is planning to reduce the interest rate on all FMS loans in FY '88 from market-rate levels to so-called concessional levels of three or four percent. In addition, the administration has approved a plan that would ease the terms on loans made by the US to some 38 countries—most notably Israel and Egypt, which currently owe some $5.5 billion and $4.6 billion, respectively.

Under this plan, the administration would lower the interest rate on Egypt's outstanding FMS loans from an average of 14 percent to 7 percent, and defer payments until the notes fall due. At that time, loanholders would have to make a so-called "balloon" payment covering the accrued difference between the two rates. In Egypt's case this payment would amount to more than $2 billion, a sum that the Egyptian government hopes the US will forgive when it falls due.

FMS loanholders will also be given the option of pre-paying their outstanding loans at par or face value without penalty under this new US initiative. The trouble with this option is that, in large part, the countries holding US FMS loans are broke and, for all practical purposes, this option is meaningless.

Dennis J. Wamsted is a free-lance writer specializing in Middle East affairs and the US Congress.