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GREGORY: Straight to the breaking news. A heavy security presence in Cairo, Egypt, this morning as military rulers are trying to strengthen their control over a country descending into chaos. So how much worse will it get in Egypt? Hundreds are dead, nearly forty Christian churches have been torched and looted and supporters of the ousted President Morsi, the Muslim Brotherhood are vowing to fight back. We will have a live report coming up from Cairo in just a moment. But back here in Washington, the critical question is, are U.S. taxpayers, in effect, footing the bill for the continuing violence? Joining me now two members of the Senate Armed Services Committee, Democrat Jack Reed of Rhode Island and Republican Kelly Ayotte of New Hampshire. Senators, welcome to you both. Senator Ayotte, straight to you. Several weeks ago this question came up, should we keep the U.S. aid flowing to Egypt? You said, yes, then. Have you had a change of heart now?
SEN. KELLY AYOTTE (R-NH/Armed Services Committee): Well, I think David, in light of recent actions-- we tried to give some time to the administration. They obviously tried to get the military government to not crack down in a violent way, to restore democracy, to move to elections, to release political prisoners. They have ignored all of those requests. And now with the recent violent crackdown, I do not see how we can continue aid. I believe it must be suspended because, unfortunately, I think the military has gotten the impression, and particularly with what the president not asking for aid to be suspended when he spoke this week, that whatever they do, we will continue our aid. So, I do support suspending aid at this time.
GREGORY: So, you talk about the change of heart because you have given them a little bit of room and they haven't responded. The Egyptian military closely allied with the U.S. government, but they are not listening. They are not sort of honoring that alliance.
SEN. AYOTTE: Right.
GREGORY: What leverage does it give the U.S. to take the step you are advocating this morning?
SEN. AYOTTE: Well, I think at this point, they are obviously getting the impression that no matter what they do, our aid will continue, so we do need to exercise our influence by saying we're going to follow the law, particularly in light of your recent violent crackdowns, suspend aid until you restore democracy, until you move to an inclusive process for elections, and obviously, a new constitution that allows all people to have a say in it, to respect people's rights. I think that's what we have to do at this point. We've tried to go down a road to get them to do the right thing. They're not doing that. And also, I would say this, David, the best way to marginalize the Muslim Brotherhood is in the ballot box, not through arrests and killing people. In fact, you're just going to encourage them to martyrdom, rather than just defeating them at the ballot box. They blew it when they were governing. And if we go to a-- a democratic process, if the military does that, rather than taking this over in the power grab they're involved in right now
SEN. AYOTTE: then the Muslim Brotherhood can be defeated through the democratic process.
GREGORY: So, Senator Jack Reed, you know, this is summertime, you're in Rhode Island, you've got to be hearing from your constituents who are saying, "Hey, Senator, why are we sending a billion and a half dollars to Egypt every year, most of that to the military, when they're crushing protestors in the street. It's just another strong man after Mubarak that seems to be quelling dissent." Senator Rand Paul tweeted this week, "President Obama says he "deplores violence in Egypt,' but U.S. foreign aid continues to help pay for it." Senator Ted Cruz says, "We're encouraging the violence by our aid." Have you had a change of heart with regard to keeping the aid flowing to Egypt?
SEN. JACK REED (D-RI/Armed Services Committee): Well, the acts of the last few days by the Egyptian military are completely unconscionable and I do believe we have to change our aid. I think also we have to have included in the legislation a national security waiver because we have to give the president not only the responsibility to deal with the government of Egypt, but also the flexibility. And we have to recognize, this is-- this is not just for the moment, this is a long-term process. One of the obvious facts of a transition from authoritarian government to democracy, it takes a long time and it's not a straight line. And so, we have to have a policy that expresses our outrage really at the military, but also gives the president the tools to, we hope, engage them. And then moreover, we have to engage the regional powers, the Saudis, the Qataris, because they provide significant aid and they also provide economic aid. And finally we have to recognize longer term that there are other strategic issues here including the safety and stability of Israel and transit of the canal. So I do believe that we can send a strong signal by suspending aid. The president has already suspended the F-16 transfers. I believe he'll-- he suspended Bright Star, our military exercise. But if we do, and I think we should, pass legislation; it has to have a waiver so that the president can be able to engage or attempt to engage the Egyptian government.
GREGORY: Well, here's how the president is engaging. He came out during his vacation on Martha's Vineyard, spoke on Thursday. This is part of what he said.
PRESIDENT BARACK OBAMA: We've sustained our commitment to Egypt and its people but while we want to sustain our relationship with Egypt, our traditional cooperation cannot continue as usual when civilians are being killed in the streets and rights are being rolled back.
GREGORY: So ratchets up the pressure, Senator Ayotte, but is the president more or less on the sidelines or do you think he's been doing the right thing?
SEN. AYOTTE: Well, I agreed with his suspension of the military exercise, obviously his condemnation of the violence but I think he fell short when he really didn't come out and call out the real question on the suspension of aid because that is the real influence that we have with Egypt. So I thought that he could have been stronger on that coming very clearly against the violence and saying we're going to suspend aid until you restore democracy.
GREGORY: So the question for me, Senator Reed, is what is it that the United States really wants to stand up for right now? I go back to the Mubarak-- at the end of the Mubarak era in 2011. At the time, Secretary of State Hillary Clinton on this program talking about what it is the administration wanted then. Watch her.
(Videotape; January 30, 2011)
MS. HILLARY CLINTON (Secretary of State): I want the Egyptian people to have the chance to chart a new future. It needs to be an orderly, peaceful transition to real democracy, not faux democracy like the elections we saw in Iran two years ago, where you have one election 30 years ago and then the people just keep staying in power and become less and less responsive to their people.
GREGORY: Do we want real democracy as Secretary Clinton said, Senator Reed, or above all, do we want to preserve our national security interests, which even the military doing what we don't want right now is still preserving, peace in the Sinai desert, access to the Suez Canal, keeping peace in the region, helping us with counter terror?
SEN. REED: I think in the long term, both those objectives are not only necessary but are closely related. We have to have a true democracy in Egypt over the long term. We recall, as you do, that the-- the latest entry into the government by the Egyptian military was sponsored by people who were rejecting Morsi, a huge number of people coming out, a popular movement. Unfortunately, I think what the military has done has taken this as a license to try to install the old national security regime that-- that was featured under Mubarak. We need both in the long run. We can't ignore the security considerations of the Sinai, of the Suez Canal transit, but in the long term, the success of the region is going to be based upon a fully functioning democracy. We've seen that take place but we also understand it takes an awfully long time. It's not a straight-line process. It's zigging and zagging. It's-- we have to be engaged but we have to recognize, too, that in the long term, our values but also our self-interests and the-- the interests of the Egyptian people is in a true democracy.
GREGORY: All right. Senator Jack Reed, Senator Kelly Ayotte, more on the Washington debate. Thank you both very much for your time this morning.
SEN. REED: Thank you.
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