	U.S. Foreign, Security, and Trade Policy in a New Era

[author name scrubbed], Specialist in International Relations ([phone number scrubbed])
[author name scrubbed], Specialist in National Defense ([phone number scrubbed])
In 2003, the 108th Congress is expected to face early challenges in foreign, defense and trade policy. Congress may beasked to provide funding for a range of foreign assistance programs that would facilitate U.S.long-range objectives in Iraq. If the AgreedFramework with North Korea fails, North Korea may resume missile testing. HIV/AIDS. The 108th Congress may be faced with the issue of which should have a higher priority - proliferation of weapons of mass destruction or terrorism (leaving aside other issues that couldtrigger sanctions, such as democracy or human rights) - and shape U.S. law to address that exigency. Stability in the Balkans. Russia and U.S.-Russia Relations. The 108th Congress also faces a set of interrelated trade issues: permanent normal trade relations (PNTR) and WTO accession for Russia, application of the Jackson-Vanik Amendment to Russia,the potential for increased U.S.-Russian energy cooperation, and tension over U.S. poultry exportsto Russia and Russian steel exports to the United States. Latin America

Overview. Congressional oversight of these issues in the 108th will likely focus on the effects on U.S.interests and the appropriate U.S. policy response. Attention is expected to focus on thecontinuing confrontation between Israel and the Palestinians, Iraq's weapons of mass destruction(WMD) programs - and the possibility of a major conflict centering on that issue (see sectionentitled "Possible War with Iraq"), and Middle East aspects of the war on terrorism, including thesituation in Afghanistan. International Terrorism and Security Assistance. HIV/AIDS. The challenges for the United States in the region are first, todiminish the threat of terrorism (as manifest by the bombing in Bali and the Taliban who have fledto Pakistan) second, to reduce the threat of war in hot spots (such as across the Taiwan Straits,between nuclear-armed Pakistan and India, or on the Korean peninsula), third, to contain the spreadof weapons of mass destruction; fourth, to promote stable economic growth and beneficial traderelations (such as China's adherence to World Trade Organization commitments and free-tradeagreements), and, fifth, to continue pressure on countries to improve their human rights and laborrecords and to adopt more democratic institutions. Southeast Asia. A number of other defense policy issues will also be on the agenda . Concurrent Receipt of Military Retired Pay and Veterans' Administration (VA) Disability Benefits. (See also the section belowentitled "Department of Defense Role in Homeland Security"). Defense Management and Business Operations Reform

Acquisition Process Reform. In considering whether to approve FTAs submitted by the Administration,Congress will evaluate how these agreements affect the often divergent interests of exporters,import-competing industries, consumers, and workers, as well as the progress of two broader tradenegotiations that are scheduled to be concluded by 2005 - the Free Trade Area of the Americas(FTAA) and the Doha Development Agenda. The 108th Congress will also take up a number of other trade issues. Agreements with Chile and Central Americaare seen putting pressure on South American countries, particularly Brazil, to negotiate on the FreeTrade Area of the Americas. Congressional Role in Trade Agreements.
The 108th Congress will be faced early on with a number of pressing foreign affairs, defense, and trade issues. This report provides background information on the issues most likely to be takenup in the first session, analyzes the congressional role in shaping U.S. policy on these key issues, andlists CRS products that provide more detailed discussion and analysis.
The terrorist attacks on the World Trade Center and the Pentagon dramatically altered the U.S. political environment, pushing issues of war and homeland security to the top of the policy agenda. Of particular concern to 108th Congress as it begins its first session will be the progress of theongoing war on terrorism, a possible war with Iraq, the unfolding crisis with North Korea, anddealing with the proliferation of weapons of mass destruction (WMD) and missiles. Each of thesetopics receives particular attention in this report.
This report also describes foreign policy tools that the 108th Congress will consider in dealing with a wide range of challenges affecting U.S. interests around the globe. It discusses major foreigneconomic and security assistance programs which Congress may consider funding, including theMillennium Challenge Account, global HIV/AIDS programs, humanitarian aid to Afghanistan,counter-terrorism activities in Southeast Asia and Africa, and possible reconstruction andhumanitarian assistance in Iraq. It examines how U.S. relations with NATO and policies towardcountries such as Iraq, Iran, North Korea, China, Russia, and Pakistan may affect U.S.counter-terrorism and non-proliferation efforts. Other issues covered include potential global flashpoints - such as the Israel-Palestinian conflict, China-Taiwan relations, and the Balkans - and U.S.concerns in Latin America, such as drug trafficking.
A number of defense issues are likely to receive considerable attention in the 108th Congress, including managing defense related costs within budgetary constraints, guiding Department ofDefense (DOD) "transformation" initiatives, setting priorities on major weapons systems, andassessing whether the military is the proper size to meet the demands of current or anticipatedmissions. Other defense issues covered include whether to allow "concurrent receipt" of militaryretired pay and Veterans' Administration disability benefits, the appropriate role of DOD inhomeland security, and oversight of reforms in defense management and business operations.
Congressional consideration of U.S. bilateral free trade agreements (FTAs) with Chile and Singapore, and other trade issues are discussed in this report as well. The 108th Congress will likelymonitor U.S. negotiations on FTAs with Morocco, Central America, the South Africa CustomsUnion, Australia, and countries of the Association of Southeast Asian Nations (ASEAN). Its agendamay include WTO compliance issues, the re-authorization of the Export Administration Act, the FreeTrade Agreement of the Americas (FTAA), and the Doha Development Agenda. This report willnot be updated.