26 



Mr. Kauzlarich. Well, we clearly need to look at creative ap- 

 proaches to promoting all of the problem areas that he identified — 

 dismantling of nuclear weapons, conversion of defense facilities, 

 privatization of state enterprises. There is a need to look at this in 

 nontraditional ways, because we've never had to face the problem 

 the same way that we do today. 



However, on the specific point of debt, I want to emphasize a dif- 

 ference between the pohcy that the administration has taken to 

 date and what he is suggesting. We view debt rescheduling as 

 being pursued within a multilateral fi'amework, specifically the 

 Paris Club of Creditors, and the objective of the exercise of debt re- 

 scheduling is to maintain the present value of Western claims. In 

 other words, we haven't contemplated any form of debt reduction 

 as his legislation, as I understand it, would require. 



So, therefore, we sort of have a different approach here, and I be- 

 lieve the Russian interest, too, is to emphasize the rescheduling as- 

 pect of this as opposed to a debt write-down. They want to reestab- 

 hsh their own creditworthiness, and what we need to try to do in 

 the debt area is to give them the breathing space, and that's what 

 a successful rescheduling program would give them, so that they 

 can take advantage of their natural economic strengths and re- 

 sources that they have to begin to become current and to become 

 a full participant in the commercial credit market. 



His proposal obviously takes in a multiplicity of issues that cut 

 across agency lines, and certainly we'd have to talk with USDA, 

 Treasury, Defense, and others as we review thi& legislation. But I 

 think it's important to look at it comprehensively and 

 programmatically, look at the budgetary implications, and then get 

 back to you with our views. 



Mr. Penny. You mentioned in your testimony and again just now 

 the need for coordination across agency lines. How, in the Clinton 

 administration, do you intend to provide for the proper degree of 

 coordination? How can you assure us that that will not impede the 

 pace at which we need to proceed on this issue? Incidentally, how 

 does Strobe Talbot fit into all of this? 



Mr. Kauzlarich. Well, once he's confirmed. Strobe Talbot will be 

 that glue, if you will, that holds the coordination process within the 

 U.S. Government together, and the objective would be to, through 

 a system of very close interagency cooperation, deal with the spe- 

 cific problem areas that we've been talking about this morning. 

 Clearly, this is not an issue that one single agency has the sole re- 

 sponsibility for. That's why we've got to bring everyone together. 

 We've been working very carefiilly with USDA, Treasury, 0MB as 

 we've looked at specificadly these issues relating to agricultural as- 

 sistance in particular. 



But what the President intends to do by creating the position of 

 Ambassador-at-large for the newly independent states, the position, 

 when he's confirmed, that Strobe Talbot will occupy, is to provide 

 the coherence that brings together both policy as well as the oper- 

 ational aspects of this. I know from my conversations with Mr. Tal- 

 bot and fi*om his testimony in his confirmation hearings that he's 

 very concerned about making the assistance programs deliver — not 

 just setting the policy, but making sure the policy is imple- 

 mented — and that's going to be, I think, a clear result of the sum- 



