During a House Foreign Affairs Committee hearing prior to the Congressional recess, Rep. Young Kim (R-CA) questioned Elaine Dezenski, Senior Director and Head of the Center on Economic and Financial Power at the Foundation for Defense of Democracies, about a new economic security council.
00:00I now recognize myself for the five minutes of questioning, and I want to start by saying
00:08that there has been a lot of suggestions about ways to elevate our economic statecraft regime.
00:16You may know Dr. Henry Farrell and Dr. Abraham Newman. They wrote in their article for Foreign
00:23Affairs in October of 2023 that the U.S. needs a comprehensive economic security strategy
00:32to outline how the U.S. could implement its de-risking strategy. Dr. Norris, I know the
00:40working group that you led has done a lot of outside-the-box thinking on how to align economic
00:46and national security resources. So can you share your thoughts on the idea advocated by
00:53some to create an economic security intelligence apparatus aligned with other intelligence arms
01:00of the U.S. government?
01:05Sure. I think that the suggestion is probably coming into a space that has for a long time
01:14been relatively under-resourced and under-provisioned. A lot of intelligence focuses
01:22around military or strategic intelligence. Economic intelligence is done widely in the
01:30private sector, but not nearly to the same scale or breadth in government. And so I think
01:35that there is potentially a positive contribution to be made around building out our capacity
01:40to be able to do economic security intelligence. The comment about Farrell and Newman's work,
01:47I think it's pretty emblematic in political science because it tends to conceive of economic
01:51tools of national power through a relatively coercive lens. And I agree that that's an important
01:57part of how these things work, but it's not the only part. And it may not necessarily even be the
02:02thing that the United States is best at. So I'd encourage the committee to think more broadly
02:06and holistically about economic tools of national power. Thank you.
02:10Thank you. You know, should Congress consider reviving the Office of Technology Assessment
02:18that provided legislative branch with scientific advice? What is your thinking on that?
02:25I am not a technical specialist, so I always find technical advice to be very constructive in a policy
02:31domain. I think that it's useful in terms of informing good policy. It provides that kind of
02:38information flow back and forth. Well, let me go to Ms. Dozenski. In April 2024, you wrote an article
02:47published in the FDD website. I think the title was Economic Security is National Security, in which you
02:55seem to support the idea of creating a new Economic Security Council to be used as a referee to mitigate the
03:05disputes between the NSC and NEC. Is that still your view? And how do you feel about Economic Security Council idea today?
03:13I do think it's still a good idea to have that strong inter-agency engagement and the ability to close the gap across the siloed organizations and
03:26regulatory authorities and policies that are being used right now. So I think we need that more than ever.
03:35Thank you. The Department has struggled to find its purpose as its most important authorities and functions have been observed by other agencies, as I mentioned in my opening remarks.
03:45This is especially true when it comes to our economic statecraft.
03:51Presidents Obama, Trump both made efforts to move USTR and President Obama proposed to consolidate it with five other agencies.
04:02And President Trump said it should be absorbed by commerce. So there is bipartisan belief that USTR's current independent status is undesirable.
04:12So, Dr. Norris, where should USTR reside? And I would like to ask Mrs. Dozenski to also answer the question,
04:23should international economic statecraft be led by a single agency? And if so, which agency should lead it? Can you both tackle that?
04:33Sure. So USTR plays a very important role in spearheading trade efforts on the part of the US government.
04:41I think what's missing has been the ability to integrate that into a larger strategy and security strategy. At various times, we have integrated it.
04:51And so I think that when we think about where it ought to live and what functions it performs,
04:56I think it needs to be considered under the larger umbrella of strategy and how that role feeds into US strategy, whether it's to expand free trade agreements or to constrict them.
05:06All those things kind of matter from a strategy perspective.
05:08Thank you. And yeah, I'm going to give some time.
05:12Thank you. With respect to who should lead on economic statecraft, I think there's a leadership role across a variety of organizations, tools and authorities, as I mentioned in the testimony.
05:24But I do think there is an opportunity for State Department to take a lead coordination role.
05:30It just feels like the time is right for this. It has to reside somewhere.
05:34The interagency process is valuable and meaningful, but there needs to be leadership that connects strategy to operational implementation and coordination.
05:45And because we are now in a what I think is a full scale pivot to an economic security power projection era.
05:55That is foreign policy now.
05:57So I believe it makes sense to create a leadership function within State Department.
