EARING OF THE WESTERN HEMISPHERE SUBCOMMITTEE OF THE HOUSE FOREIGN AFFAIRS COMMITTEE SUBJECT: THE CRISIS IN HONDURAS WITNESSES: MICHAEL SHIFTER, VICE PRESIDENT FOR POLICY, DIRECTOR OF THE ANDEAN PROGRAM, INTER-AMERICAN DIALOGUE; GUILLERMO PEREZ-CADALSO, FORMER FOREIGN MINISTER AND SUPREME COURT JUSTICE, REPUBLIC OF HONDURAS; JOY OLSON, EXECUTIVE DIRECTOR, WASHINGTON OFFICE ON LATIN AMERICA; CYNTHIA ARNSON, DIRECTOR OF THE LATIN AMERICA PROGRAM, WOODROW WILSON INTERNATIONAL CENTER FOR SCHOLARS; LANNY DAVIS, PARTNER, ORRICK, HERRINGTON & SUTCLIFFE, LLP, REPRESENTING THE HONDURAS CHAPTER OF THE LATIN AMERICAN BUSINESS COUNCIL; SARAH STEPHENS, EXECUTIVE DIRECTOR, CENTER FOR DEMOCRACY IN THE AMERICAS; OTTO REICH, PRESIDENT, OTTO REICH ASSOCIATES, LLC, FORMER ASSISTANT SECRETARY OF STATE FOR WESTERN HEMISPHERE AFFAIRS CHAIRED BY: REPRESENTATIVE ELIOT ENGEL (D-NY) LOCATION: 2172 RAYBURN HOUSE OFFICE BUILDING, WASHINGTON, D.C. TIME: 11:00 A.M. EDT DATE: FRIDAY, JULY 10, 2009

REP. ENGEL: A quorum being present, the Subcommittee on the Western Hemisphere will come to order.

I want to thank my colleagues for being here on a Friday. We usually don't have hearing on Fridays, but due to the urgency of the matter and the fact that this is something that we could not look the other way and just push back for a couple of weeks, I'm very glad that we were able to call this hearing. And I want to thank my colleague, Mr. Mack, for his cooperation in expediting this hearing.

Let me start by saying that I am deeply concerned with the recent events in Honduras and have called on today's hearings to focus our attention on the crisis. I must say that we had asked the State Department to participate in the hearing, and I must express my dismay that they chose not to come.

I think that Congress, being a co-equal branch of government, has every right to expect the State Department to send a representative when we request it. And I understand that there may be things that they would not want to say or could not say, and we would respect that. But I must say that they need to respect Congress and the wishes of Congress.

And this better not be a pattern of any kind. I realize that there are delicate negotiations going on and they don't want to jeopardize those negotiations, and neither do we, but frankly I think they could have come and we would have understood that certain things could not be said.

So I just want to make it very clear for the record that if this is some kind of pattern, it will not be tolerated by me as chairman or by anybody else on this subcommittee. We intend to have the State Department respond positively to us when we ask for their appearance. And I want everyone to take note that we expect them to appear when we invite them in the future.

I and many other people are deeply concerned with the recent events in Honduras, and we've called today's hearing to focus our attention on the crisis. I issued a statement shortly after the events happened in Honduras. And let me say, before delving into the details, I would like to state very clearly that it's my strong belief that the military should not have deposed President Zelaya and whisked him out of the country.

We can all discuss the events leading up to the removal of President Zelaya, and I intend to do just that. I think there are many good points to make on all sides, and we have excellent panelists who will testify on different aspects of the situation and will agree or disagree with each other. But in the end, our hemisphere cannot tolerate what is essentially a military coup. We don't want to go back to the bad old days when that was commonplace in our hemisphere. And I think that this certainly has the remnants of it and is not something that we should tolerate.

But, that being said, as you say, on the other side of the coin, President Zelaya's efforts to hold a referendum on whether to create a constituent assembly to change the Honduran constitution is also very troubling. It's my understanding that the Honduran constitution contains several clauses which cannot be altered, and among those provisions are those limiting the terms of presidents. According to one interpretation, even trying to amend these causes or proposing their reform automatically and immediately ended Manuel Zelaya's presidency for at least 10 years.

As for me, I'm not a scholar of the Honduran constitution and will not even pretend to be an arbiter of Honduran law or of these causes. That's for the courts and political institutions of Honduras to decide. But as an observer of the region, and having watched the run-up to the recent crisis, I think it was clear that virtually all major Honduran political institutions and actors opposed President Zelaya's efforts. Not only were the supreme court, congress and Zelaya's own attorney general against him. I'm told even members of his own political party and the influential Catholic Church were hostile to Zelaya's efforts to change the constitution.

I do think this matters. When the entire political establishment speaks and expresses dire concerns, the president needed to listen. From everything I can see, he did not. This is not to say that those who deposed him were angels either. Not only am I deeply troubled by the removal of President Zelaya and whisking him out of the country, but I've also heard credible reports of human rights violations in the aftermath.

If the de facto government wants to live up to its assertion that it was defending democracy, there's no better way to do so than to respect the views of those with whom you disagree, end the clamp-down on fundamental freedoms, and protect all peaceful dissenters.

Moving forward, I'd like to now discuss for a bit the ongoing diplomatic process. As I mentioned before, there are negotiations going on. President Obama went to the Summit of the Americas in Trinidad and Tobago -- and many people on our subcommittee and myself were there -- pledging that the United States would be a true partner of countries in the region and would treat our neighbors with respect.

I think the administration has taken a giant step forward in fulfilling that commitment with its excellent diplomacy and mediation efforts on the Honduran crisis. Our administration, the Obama administration, condemned the removal of President Zelaya and called it illegal. They stood with our partners in the hemisphere by supporting a resolution of the Organization of American States calling for President Zelaya's restoration to office. And as I mentioned, Secretary Clinton has jump-started a mediation effort, led by the Nobel Peace Prize-winning president of Costa Rica, Oscar Arias.

With this very strong U.S. diplomatic effort in the background, President Zelaya and de facto President Nicoletti (sp) have begun meeting under the auspices of President Arias in Costa Rica.

So I am glad that the secretary of State and her team are navigating the diplomatic waters at this time. And I hope that a compromise will come about.

However, as much as I defend the OAS -- and you all know yesterday on the House floor I strongly opposed removing money from the OAS -- I must question the expelling of Honduras from the OAS. I'm a strong supporter of the OAS, and as I said, I spoke on the floor of the House of Representatives last night on the floor talking about not removing money from the OAS.

But I'm concerned about their action to suspend Honduras. I think you have to be consistent in what you do. And at a time when we drop the suspension of Cuba and we suspend Honduras, I think it sends an inconsistent message to the region and the world. I think consistency is important. With consistency you have credibility.

I must also say I'm increasingly troubled by efforts throughout the hemisphere to change constitutions so that leaders of certain countries can stay in power after their terms end. We see a pattern here in many countries, and I think it's a dangerous pattern. It's not a pattern that we should support. I think we need to shine a bright light on the dangers of this anti-democratic trend.

And so I say, while the OAS rightly condemned the removal of President Zelaya in Honduras, I believe it should also criticize this drift away from respect of the constitutionalism and the normal transfer of democratic power. If a constitution in any country says that a president cannot run for a second term, I think that suspending the constitution, as was done in many different countries, enabling the leader to continue, is a troubling trend.

So I would like to conclude the same way I began. I believe what took place in Honduras was wrong and deserves to be condemned. But the complicated story doesn't begin or end there. It is my hope that this hearing will draw out many of the issues surrounding the removal of President Zelaya, which add color and depth to our understanding of the crisis, with the hope that such a series of events will not repeat itself.

And with that, I would like to invite my friend, the ranking member, Mr. Mack, to give his opening statement.

REP. CONNIE MACK (R-FL): Thank you, Mr. Chairman. I want to thank you for holding this hearing today. It is very timely.

I also want to thank the witnesses for making yourselves available and being here. And we are very interested to hear what you have to say and to maybe pick your brain a little bit. So thank you for being here.

Let me just start off by saying this. This was not a military coup. And if somebody -- if there's any fault here, it is on Mr. Zelaya. He is the one that, at every turn, turned his back on the people of Honduras and his own constitution, which he pledged to uphold.

As we hold this hearing, parties from all sides are meeting in Costa Rica to negotiate a peaceful and democratic resolution. But it is important to look at the whole picture. Who are the main players? How did we get here? And who is meddling from the outside?

Now, Mr. Chairman, we have Mr. Zelaya, a man who refused to listen to the Honduran supreme court, a man who refused to listen to the Honduran attorney general, a man who refused to listen to the Honduran congress. Mr. Chairman, this is a man who tried to undermine the legislature, the judiciary, the attorney general, the human rights commission, business associations and four of the five political parties represented in the national congress, including his own party.

I am interested to hear what our panel has to say on this. Not only that, Mr. Chairman; this is a man that, when told no by the courts, took it upon himself to storm the military base and seize and distribute ballots for an illegal referendum, ballots that Hugo Chavez' fingerprints are all over.

It seems to me that the more we look at Mr. Zelaya, the more we find a man who believes he is above the law, untouchable, and clearly a man who has no respect for democracy. I also look forward to hearing from our panel on the links between Hugo Chavez and Mr. Zelaya. Since he was exiled, Mr. Zelaya has been flown around the hemisphere on Venezuelan jets. The ballots that were going to be distributed for the illegal referendum were printed and flown from Venezuela.

Furthermore, there are reports that Mr. Zelaya has been involved in drug smuggling from Venezuela and other places in South America. Also there is little doubt that Mr. Zelaya violated Article 239 of the Honduran constitution, which clearly states that, quote, "Anyone who violates this provision must immediately cease the discharge of their duties."

As the parties negotiate in Costa Rica, I want to make one last point. I believe the Obama administration should be commended for making a renewed commitment to Latin America. But at the same time, by calling this a coup, and by early statements insisting on the reinstatement of Mr. Zelaya, the administration now stands with the likes of Chavez, Morales and Ortega, and not with the Honduran people.

While we all want a peaceful and democratic resolution, now is not the time to stand -- now is the time to stand for freedom and with the Honduran people in their fight against the tyranny of the Bolivarian revolution.

Mr. Chairman, thank you again for holding this hearing, and I look forward to hearing from our panelists later.

Mr. Chairman, I just want to say that yesterday on the floor you had the opportunity to speak against the motion to recommit, talking about the OAS and Honduras. I have a different opinion. I believe the OAS is a dangerous organization that is not fighting for freedom or democracy, but instead standing in the way and giving an opportunity for people like Hugo Chavez and others to use the OAS to undermine democracy in the Western Hemisphere.

I hope that as we move down the road, we can have a hearing that's more focused on the OAS so we can have a lengthy debate on whether or not the OAS is still an organization that should be supported by the United States.

Thank you, Mr. Chairman.

REP. ENGEL: Well, thank you, Mr. Mack. And you know I'm always open to having hearings on a myriad of issues, so we can certainly discuss that.

Because we have seven very excellent panelists, and I want to hear from them, I'm going to restrict opening statements to two minutes for each person. We'll go down the line. I'll start with Mr. Meeks.

REP. GREGORY MEEKS (D-NY): Thank you, Mr. Chairman. I'll try to do it in two minutes.

First of all, I think that we've come a long way in the United States from where we were in 2002. There was a coup d'etat in Venezuela, and within 48 hours we supported the coup d'etat government. We've got to make those improvements, and I think we've made that with this administration this time.

We clearly cannot turn back the hands of time. I had the opportunity, at the inauguration of President Martinelli, to talk to several heads of state, including President Arias, who said that we could not allow coup d'etats. And this is the governments of other areas to try to figure out how we make sure that we don't turn back the hands of time. And that's what this is really about. So I'm nervous, as the chairman is, that the hands of time is not turned back.

Now, whether Mr. Zelaya has done whatever he has done, I don't believe that the military has the right to come in and pull him out. It would have been the equivalent, I would think, of, at the time when President Nixon, who had violated laws and the Constitution of the United States, had we not conducted a process in which he would have been impeached, of having, in the middle of the night, the United States Army going into the White House and taking president Nixon out and having him exiled.

Clearly there's a violation, but there is something that has to be done within the democratic process to make sure that those who committed that violation in that office is democratically removed, in my estimation.

Also, I think it is also important that when you talk about the OAS, and in this particular situation, that there's 33 nations there. And we talk about democracy and talking about -- and it took them -- I know it was over 24 hours here in Washington, D.C., working and trying to come together as an organization in a democratic process to decide what to do with reference to Honduras. And it's not just the United States acting in a unilateral manner, as the president has said, but the United States acting in conjunction with others in the region to make a difference.

We've got serious concerns here. I want to hear the witnesses. I wish I had more time, but I'm being gaveled already by my friend the chair, and I'll yield back.

REP. ENGEL: Thank you, Mr. Meeks.

Mr. McCaul.

REP. MICHAEL MCCAUL (R-TX): Thank you, Mr. Chairman. I'll be very brief in my remarks, but I do want to make a few comments. I look forward to the testimony.

I agree with the ranking member that this was not a military coup. This was ordered by the supreme court. The president was in violation of his own constitution. He disregarded his own attorney general. And what's most disturbing to me is that these ballots that Zelaya ordered, printed, at least from the information I have, came from Venezuela. This is the same type of thing that Hugo Chavez pulled off in his country. It seems to me that that's the same pattern that Mr. Zelaya is emulating.

I'd like to know from the panelists and what I'm most interested in is what I think the ranking member indicated, is what is the connection between Mr. Chavez and Zelaya? What's the connection between Venezuela and Honduras?

And with that, I'll yield back the balance of my time.

REP. ENGEL: Thank you, Mr. McCaul.

Mr. Sires.

REP. ALBIO SIRES (D-NJ): Thank you, Mr. Chairman.

The still unfolding events in Honduras are both shocking and frustrating. On one hand, you have a president who overstepped his constitutional bounds. On the other hand, you have a military that exiled a democratic elected president.

Now our government is condemning the military removal of President Zelaya, but look at the company we keep. We are supporting a man who plotted to hold an illegal vote and circumvent the constitution. In the ongoing debate whether President Zelaya acted undemocratically or if it was the military who acted undemocratically, although it appears they are both at fault, it is important to remember that just a few weeks ago President Zelaya proudly led the movement to readmit Cuba into the Organization of the American States. The OAS resolution on Cuba did not mention the Inter-American Democratic Charter. And now he is calling on Honduras and the international community to uphold this charter.

These events make me seriously question the stability of democracy, not only in Honduras but in Latin America. Governments throughout the region have made remarkable progress since the days of military coups and the oppressive regimes. But the action in Honduras severely obstructs this progress. Unfortunately, this is not the first time we have witnessed such grabs for unchecked power.

It is clear that democratic principles continue to be at risk in this hemisphere.

And I would like to thank the panelists that are here, and I look forward to hearing what you have to say.

REP. ENGEL: Thank you, Mr. Sires.

Mr. Smith.

REP. CHRIS SMITH (R-NJ): Thank you.

I appreciate the chairman's disappointment that the administration is AWOL today. Congress has a right and an obligation, a duty, to know what the administration is or is not doing during this crisis.

Mr. Chairman, the world is slowly waking to the reality that what at first might have looked like a military usurpation of democracy, courtesy of very sloppy news reporting, was actually the culmination of a democratic process, a process that began months before.

The branches of the government of Honduras -- the supreme court, the congress and the military -- performed just as they were intended to by the wise writers of the Honduras constitution. Mr. Zelaya was removed from office for his unconstitutional and illegal attempts to alter the constitution of Honduras for purely selfish reasons.

Latin Americans are rightly sick and tired of presidents violating the rule of law to ensure their own presidencies in perpetuity. Article 239 of the Honduran constitution explicitly says, and I quote, "No citizen who has already served as head of the executive branch can be president or vice president." Moreover, the constitution also makes clear that anyone who tries to alter the term limits of the office of the president is guilty of treason.

The Honduran supreme court has stated that the military acted on its orders, and the Honduran congress overwhelmingly passed a decree removing President Zelaya from office and replacing him with the president of the congress. The military has not retained power. Upcoming presidential elections continue to move forward on schedule.

Finally, the (surface appeal ?) argument is that what happened in Honduras was a coup. But that view, in my opinion, melts under any serious scrutiny. Rather, democracy and the rule of law triumphed over Mr. Zelaya's lawlessness.

I congratulate the people of Honduras for their foresight in the writing of a constitution and for their courage to take action in support of the rule of law.

I yield back the balance.

REP. ENGEL: Thank you, Mr. Smith.

Mr. Green.

REP. GENE GREEN (D-TX): Thank you, Mr. Chairman, for holding the hearing.

And coming from Texas and our relationship with both Mexico and Central America and Latin America, this is very important, because we have a number of Honduran-Americans who live in our district.

When President Zelaya announced that he would hold a non-binding referendum asking Honduran voters whether they wanted a constituent assembly to establish them in their constitution, the situation in Honduras started to deteriorate. The issue culminated on June 28th when the Honduran military surrounded the presidential residence and arrested President Zelaya and flew him to Costa Rica, just hours before the polls were to open.

President Zelaya has since been denied return entry, and the Honduran congress approved the decree suspending a number of Bill of Rights issues and constitutional rights that I have concern about. While I don't agree with what President Zelaya has done during his administration, the restoration of democracy in Honduras is critical for stability.

And I applaud the organizations like the OAS and CARICOM and UNASUR for quickly and (unequivocally ?) condemning the Honduran military's action. But I also know that we need to have an impartial negotiation. And I'm glad Secretary Clinton announced that former President Arias of Costa Rica will be that mediator and have democracy restored.

And again, like my colleagues on both sides, we see that in our administration, in our hemisphere, a return to a strongman and military government in usurping the constitutional authority, whether it be in Honduras or in other parts of the hemisphere, including Venezuela, and I would hope that we would see our country providing the leadership for democracy and not necessarily just for whoever happens to have the strong power at that time.

And I yield back my time.

REP. ENGEL: Thank you, Mr. Green.

Mr. Burton, our former ranking member and chairman.

REP. DAN BURTON (R-IN): Thank you, Mr. Chairman. I'll just take a couple of seconds here.

First of all, I talked to some people at the State Department yesterday and they told me that they wanted to give SICA, the Central American Integration System, headed by Mr. Arias, a chance to try to resolve this by getting all the facts. And I think the facts are now clear, of course. But nevertheless, they wanted to give him some time, and that was the reason they said they didn't want to appear today. I disagree with that. They should be here. But nevertheless, that was the reason that they gave.

I'd just like to reiterate what the ranking member said, and I thought he said it extremely well, and that is that the arrest warrant was issued by the supreme court that ordered the armed services to arrest Mr. Zelaya. Now, in the United States, if an arrest warrant is issued, the police go out and arrest them and they put them in handcuffs and they take them to jail. In this particular case, the military was told to do it and they did it.

And so when everybody talks about this being a military coup, I just don't get it. There was an arrest warrant issued by the supreme court. The president had violated the constitution and had not paid any attention to anybody that was giving him the proper advice. And so I don't see that this was a military coup.

And with that, I yield back the balance of my time.

REP. ENGEL: Thank you, Mr. Burton.

Ms. Giffords.

REP. GABRIELLE GIFFORDS (D-AZ): Thank you, Mr. Chairman.

I'm going to be really brief, because I know we're going to have votes soon, and we have a distinguished panel here that I think it's important to hear from.

REP. ENGEL: Thank you.

Mr. Fortenberry.

REP. JEFF FORTENBERRY (R-NE): Thank you, Mr. Chairman, for convening this hearing to help us to come to terms with the developments in Honduras and understand the dynamics and potential outcomes of this very serious leadership crisis unfolding there.

I believe it is vitally important to take a deep breath here and just simply look at the facts, understand the objective truth about Honduras's civil democratic institutions, as well as the scale and scope of abuses of power attributed to Mr. Zelaya.

I would also implore our panel to assess the policy judgments made by the administration thus far in this crisis, the OAS, as well as other key regional as well as international players in this situation.

So with that, Mr. Chairman, I yield back.

REP. ENGEL: Thank you.

Mr. Payne.

REP. DONALD PAYNE (D-NJ): Thank you very much, Mr. Chairman, for calling this hearing.

I think that, as you've indicated, I think it's a bad trend when we have people try to alter the constitution of countries -- I mean, to extend terms of office. However, by the same token, I can't see where anyone can say that if you take somebody out with an army and guns, put him on a plane, and as he tries to come back, you got the military at the airport saying, "If you come any closer, we'll shoot you down," that's a military something. I mean, it's like a duck, you know.

So it's a very complicated situation here. And I, you know, think that because Venezuela was supportive of the president there doesn't mean that we should therefore condemn that country. If we start doing that, we'll have to look at every country in the world and who they associate with, and that certainly wouldn't make any sense.

So I think it's a very complicated situation. I hope that we can get to the bottom of it. As a previous member mentioned, we've had presidents who didn't take the advice of their attorney generals. As a matter of fact, Mr. Peabody, the attorney general, was fired by the president back in the Nixon days because he wouldn't give him the judgment that he wanted. I'm not saying it was right to do it here, nor was it right to do it there.

So this is really a complicated situation, and I hope we can come up with a solution. But, once again, in the Africa Union, when a country is taken over by the military, that country is suspended from the Africa Union. They do not tolerate it, because once it happens there, it'll happen there and it'll happen at the next place, and you'll have that way to take out presidents.

REP. ENGEL: Thank you.

Mr. Bilirakis.

REP. GUS BILIRAKIS (R-FL): Thank you, Mr. Chairman.

This hits home with me because my Honduran-American constituents are particularly concerned that President Zelaya was slowly stripping away the rule of law in Honduras. They fear that Honduras was going to turn away from its democratically elected and constitutionally based institutions and evolve into a Hugo Chavez type of autocratic state.

I think what is particularly disconcerting for me is the fact that no American official at the U.S. embassy in Honduras or the State Department has spoken with the current president of Honduras.

The Obama administration has made it a feature of their diplomacy efforts to listen to all sides and have even displayed a willingness to talk with avowed enemies of the United States. And yet the administration has refused to speak with the institutions in Honduras like the supreme court, the congress, or even the president to fully understand what happened and why Mr. Zelaya has -- (audio break) -- removed.

I look forward to hearing from the witnesses as to why the administration continues to ignore --

(Audio break.)

REP. DANA ROHRABACHER (R-CA): (In progress after audio break) -- in the drug trade. This would-be caudillo was engaged in an anti- democratic power grab. He was -- his intent was to be a strongman in the mold of Castro or Chavez or whatever strongman it was, but he was trying to seize power for himself. It was a power grab. He was leading a street mob to give himself that unlimited power.

Stopping someone like that is a victory for democracy. We don't need Latin America sliding back, whether it's left-wingism or right- wingism, in terms of the caudilloism that it reflects. That should have been left behind a long time ago. And his defeat, the defeat of that power grab, as I say, no matter how it was accomplished, is a great victory for democracy in Central America and Latin America in the long run. We all know that. We all know what he was trying to do. We should be happy and applauding that he was stopped from that horrible power grab, which would have ended real democracy in his country.

REP. ENGEL: Thank you.

Mr. Delahunt.

REP. WILLIAM DELAHUNT (D-MA): I thank the gentleman.

I don't think you can put a shine on this sneaker. I mean, common sense tells you that it's a coup, whether it's a military coup, but it certainly was an unconstitutional removal.

You know, I'm just concerned about not what's happening in this room in this hearing, but the message that's being received all over Latin America at this moment in time. What you're hearing, of course, is this is about Hugo Chavez.

Well, I want my colleagues, particularly my friends on the other side of the aisle, to stand with Felipe Calderon, to stand with Alvaro Uribe, to stand with the president of Chile, to stand with all of the other democratically elected presidents in Latin America who have condemned this, who aren't trying to pass -- I never realized how many experts we had, by the way, on the Honduran constitution. I mean, it's amazing. There must be a class somewhere. I haven't taken it yet, so I have to acknowledge my own ignorance. But of course it's a coup.

And who are these people? I don't know who they are. I mean, I really don't. I do know, however, that the current provisional president attempted the same thing that President Zelaya did in 1985. But I bet there wasn't a peep out of this institution at the time. He attempted to extend the term of some president in the mid-1980s by two years, according to a report. I find that interesting. But that's irrelevant to this.

I'm sure some of the people are well-intentioned, but I did note -- and I think it's important -- and I haven't heard outrage expressed by anyone, including members on the other side, about the statements of the provisional foreign minister, whom they had to dump. But let me tell you what he had to say about the president of the United States. "I like the little black sugar plantation worker."

REP. ENGEL: The gentleman's time has expired.

Mr. Hinojosa.

REP. RUBEN HINOJOSA (D-TX): Thank you, Mr. Chairman. I appreciate your letting me sit in this hearing. I congratulate you for calling it. And I am going to pass an opportunity to make a statement, a prepared statement, and listen with great interest to what I can learn about the situation in Honduras.

Thank you.

REP. ENGEL: Thank you, Mr. Hinojosa.

Now I'm going to introduce our distinguished witnesses. I think the toughest thing about being a witness is you have to listen to all of us before we can listen to you. That's the price you have to pay. I'm sorry.

Let me ask our witnesses to please keep their testimony to five minutes apiece. You do not have to read your statements if you do not want to. You can ask that they be submitted into the record, and they will be as if they had been repeated. And you can just summarize, and that might be better. I'll leave it up to the witnesses.

Let me mention all of our witnesses. Michael Shifter is vice president for policy at the Inter-American Dialogue. Welcome.

Guillermo Perez-Cadalso is a former Honduran foreign minister and supreme court justice and currently serves as professor of international law at Honduras' National University. Welcome.

Joy Olson is executive director of the Washington Office on Latin America, WOLA. Welcome.

Cynthia Arnson is director of the Latin America program at the Woodrow Wilson International Center for Scholars. We welcome you.

Lanny Davis is a personal friend of mine but a partner with Orrick, Herrington and Sutcliffe and is here today representing the Honduras chapter of the Latin American Business Council. Welcome.

And Sarah Stephens is the executive director of the Center for Democracy in the Americas. We welcome you.

And last, but not least, Otto Reich. He's president of Otto Reich Associates and a former assistant secretary of State for Western Hemisphere Affairs. Welcome.

And we'll start with Mr. Shifter.

MR. SHIFTER: Thank you very much, Mr. Chairman.

I'd like to submit my statement for the record.

I want to commend you for holding this hearing. The Honduras situation poses a real critical test for the U.S. government and for the hemisphere. What happened on June 28th in Honduras was a rupture in the democratic order, the democratic process, that I think was properly censored by the United States and the hemispheric and international community.

President Zelaya has more than his share of blame for provoking the crisis to begin with by defying the supreme court and the congress and all the legal procedures that may have been followed before his ouster. But the forced removal from Honduras was a clear violation of the constitution and basic democratic norms.

Having rightly condemned what happened, the main task was to calm the tensions and try to work out a solution. I'm not sure that opting for a more punishing stance so quickly, to issue an ultimatum for the return of President Zelaya and suspending Honduras from the OAS, was the wisest court. The attempted unsuccessful return of President Zelaya last Sunday was particularly counterproductive. As a result, both sides became more entrenched in their positions.

Today this crisis has moved to the phase of negotiation under President Arias. This is an encouraging sign. But caution is in order. The first day showed this is going to be difficult and may take some time to work out. There's tremendous bitterness and distrust between the two parties.

Still, one can imagine elements of a formula that will hopefully be agreed to. It is crucial that conditions in Honduras permit fair and credible elections that are now scheduled for the end of November. It is welcome that the United States is discreetly supporting this initiative announced by Secretary of State Clinton last Tuesday.

The Honduras crisis has posed two difficult challenges for the United States. The first concerns how to deal with the interruption of the democratic process in the region, balancing legality and legitimacy against maintaining social peace and governability on the ground in Honduras.

The second challenge involves finding an effective multilateral approach that engages with Latin American partners while also being active in helping to shape a favorable outcome. The idea is to try to resist the temptations to impose a solution or dictate a solution, but alternatively, not to withdraw and be passive either.

In general, I think the Obama administration has struck the right balance on both of these challenges. It was important to bear in mind from the beginning how decisions that followed the principal stand on the coup -- the suspension of Honduras, for example -- would either exacerbate or diminish the polarization, which is, after all, the root cause of the crisis. This is a case for combining principle with pragmatism. The U.S. is now seen as an important and honest broker in the region.

As I said, the OAS took the right stand on the crisis but might have waited and explored other measures before resorting to such a confrontational response, which did not work and, in fact, seemed to only have hardened positions on all sides.

The OAS might have also tried to anticipate and prevent the heated situation before it reached a boiling point. Alert mechanisms are difficult, and there are sensitive questions about sovereignty. But this is an essential function appropriate for a regional body like the OAS. The head-on collision in Honduras had been building for some time, and an effort should have been made to defuse the mounting tensions.

Looking ahead, even though President Arias is taking the lead as mediator, the OAS should support the efforts to reach a compromise in Honduras. What this crisis has done is to bring into sharp focus the question of double standards and hypocrisy applied to different situations in Latin America. It's not that the OAS shouldn't have reacted to this situation, but it should have reacted to others. The OAS has indeed been too passive and silent in dealing with ruptures in the democratic order in other situations.

There needs to be a way to focus on improving the Inter-American Democratic Charter and the way it is applied and implemented in Latin America. One idea is to not restrict the use of the charter to the executive branch, but also extend it to other branches of government and to the opposition. This could have worked in the Honduras case to head off the eventual coup.

Unfortunately, power grabs in defiance of democratic norms and institutions are too common in Latin America, so the charter and member OAS governments need to take that disturbing tendency into account.

Finally, it would be surprising if the United States did not have to deal with similar situations in Latin America in the future. The region is unsettled, at least several parts of the region. And I hope this case shows the wisdom of working in concert with regional partners to seek solutions that reflect common sense and pragmatism but are anchored in the rule of law.

I look forward to your questions. Thank you.

REP. ENGEL: The gentleman's time has expired.

Mr. Perez-Cadalso. Could you pull the microphone a little closer?

MR. PEREZ-CADALSO: Chairman Engel, Ranking Member Mack and the other distinguished members of the subcommittee, thank you for inviting me today.

I will now provide a summary of my prepared statement, which I request to be included in its entirety in the record.

My name is Guillermo Perez-Cadalso. In the past I have served my country as the minister of foreign affairs, as a supreme court justice, and as the president of the National University of Honduras.

Today, however, I come before you with the title of "concerned Honduran citizen" and not as a government representative.

I have spent this week as part of an ad hoc, diverse delegation of other concerned Honduran citizens visiting with many members of Congress. While we have made some progress in creating greater understanding of the history and context of what has happened in my country, I want to share with you some facts and observations that have been lost or confused in the intense media coverage.

One, the military is not in charge of Honduras. The constitutional order of Honduras remains intact. Our government continues to be led by a civilian executive branch, a duly elected Congress and our judicial branch, guided by our 1982 constitution and the rule of law. Indeed, it was the proper application of our constitution, the rule of law and presidential succession that initiated the recent events in Honduras.

Two, many have confused the timing of key events. For example, Mr. Zelaya was charged with crimes against the form of government, treason, abuse of authority and usurpation of power and the supreme court ordered his arrest before he was taken out of the country.

Three, there has been a failure to separate the issue of Mr. Zelaya's removal from the country versus his proper removal from the president's office according to our constitution and a result of the very serious criminal charges against him. I can only speculate as to what the military did and why. Taking Mr. Zelaya out of the country could have been the result of a terrible dilemma. It is possible that the military, which was properly ordered to arrest Mr. Zelaya by the Honduran supreme court to uphold the constitution, thought it would be more prudent to take him out of the country, rather than hold him in custody in Honduras and risk greater civil unrest and violence.

After all, the military faced a person who had already abused his stature, inciting a mob and using the threat of violence to storm an air force base.

Fourth, there has been a grave misunderstanding about the extent of support for Mr. Zelaya. There is a broad consensus in Honduras that Mr. Zelaya violated the law and our constitution. The Honduran supreme court voted 15 to zero that he broke the law. The national congress voted 124 out of 128 that he broke the law, including every member of congress from his own party. The attorney general, the supreme electoral council and the human rights commissioner all agree that Mr. Zelaya broke the law. Others who agree include four out of five of the political parties, representing more than 90 percent of the congress, including Mr. Zelaya's own party, many labor unions, the private sector and the Catholic and evangelical and other protestant churches.

Meanwhile, tens of thousands of Hondurans have marched for peace and democracy and to express support for the constitutional succession, including more than 50,000 people on July 3rd alone in Tegucigalpa.

Before concluding, here are several thoughts and hopes for the future.

First, the facilitation of the mediation by President Oscar Arias is welcomed, and we praise Secretary of State Hillary Clinton's endorsement of the dialogue process, which should work toward a phased solution that includes fact-finding. We also appreciate that the U.S. government joined last week with other governments in the Organization of American States in advising Mr. Zelaya that it was not the right time to travel back to Honduras.

Second, I believe that the OAS did not live up to the letter and spirit of its charter in this instance. It was too quick to accuse, too soon to judge and too eager to condemn. The OAS should -- could have acted to prevent the situation, but sadly stood silent in the face of months of misconduct by Mr. Zelaya. After the constitutional succession occurred, the OAS did not engaged in collaborative fact- finding. And if it had done so, the burden to host the dialogue would not have fallen on President Arias.

Third, we hope that the interim government's earnest efforts to engage in the dialogue are proof enough that the restrictions on credit flows from international financial institutions should be lifted, and that bilateral and multilateral cooperation in aid programs should continue. These restrictions only exacerbate the effect of the international economic crisis on Honduras and the Honduran poor, and shortchange U.S.-Honduran efforts to combat drug trafficking and organized crime.

Finally, the dialogue can succeed if both sides refrain from personal, emotional reactions and stick to constructive discussions about the issues. Each side can find common ground and solutions if there is a willingness to act in good faith in the higher interest of our country.

Thank you, and I will gladly take your questions.

REP. ENGEL: Thank you.

Ms. Olson.

MS. OLSON: Thank you, Mr. Chairman, for the invitation to speak today. And I would request that my written statement be submitted to the record.

REP. ENGEL: Without objection, so ordered.

MS. OLSON: Thank you.

I must say that I've been pained to watch the conflict playing out in Honduras the past few weeks. It's a country I love and where I spent the formative years of my professional life.

I'm not going to spend much time talking about the facts of what happened, as there will be a lot of that. I'd like to make a couple of observations.

One, it's not only the U.S. who identified this as a coup. Every country in the hemisphere has identified this as a coup. So it's not something that we're standing alone on.

Second, it seems like there was plenty of violating of the law going around on all sides. And those are important issues, but, again, I think there was plenty of it happening.

Also, back to the coup issue for a second, when the military takes the president by force in his jammies do the airport and puts him on a flight out of the country, that's a coup. You know, if it walks like a duck and talks like a duck, it's a duck.

Let me also say a few things about what this situation is not. It's not about Venezuela. It's not about -- and no matter how much President Chavez might want it to be or his opponents might want it to be, it's not about Venezuela.

It's also not about liking Zelaya or how popular he is. If that were the standard, former President Toledo of Peru never would have made it to the end of his term after his approval rating bottomed out at about 7 percent.

While the immediate crisis is around Zelaya's return, there's a more fundamental ongoing political crisis in Honduras. It's a crisis in the party system. Many poor people don't bother to vote, viewing the choice between parties as meaningless. Over the last 20 years of democratic transitions, they've done little to address the political and economic marginalization experienced by the majority of Hondurans.

I'd like to say a few things about the administration's handling of this situation. I think that it was good. It was swift to defend -- to -- it was swift to condemn the coup. The decision to use the OAS in its diplomatic efforts to address the conflict was a welcome change from our historic interventions in Latin America, which are well remembered in the region. The administration had talked about changing the U.S. government's modus operandi in working through multilateral institutions, and in this case I think they walked the walk.

That said, the days following the coup were riddled with mixed messages from the State Department about whether a coup had actually occurred. I'm not sure if the State Department lawyers have yet made this determination. The issue seems to have been that the administration wanted to use aid as a leverage to get the two sides to the table -- a noble goal. But the law is clear that U.S. aid to a government must be suspended if there is a coup. If the military sending a president into exile in his pajamas doesn't qualify as a coup, then what does?

I want to just leave you with one quote from a State Department press briefing. I was following them the past two weeks, and their responses about this issue and the -- and Section 7008, the coup language in the Foreign Assistance Act. Their statements were incredibly convoluted. On the 6th of this month, the press spokesman at the State Department had this to say. "We are suspending as a matter of -- as a policy matter assistance programs we would be legally required to terminate if the events in Honduras are found to have triggered Section 7008."

As Congress moves forward to rewrite the Foreign Assistance Act, I would suggest that you consider further clarifying Section 7008, the coup clause, defining what should be suspended and the process by which the suspension is determined. I would also suggest making it clear that military assistance provided through the Defense Department and not through the Foreign Assistance Act should be suspended as well. Being wishy-washy about applying 7008 for well over a week after the coup I think sets a bad precedent.

On the role of the OAS, generally, throwing stones at the OAS is fairly easy sport. But it is -- but this is the kind of situation that makes clear the need for the OAS. In the immediate aftermath of the coup, no other body could have dealt with this crisis. A unilateral intervention on the part of the United States or, say, Venezuela, would have been disastrous. The fact that governments of all political stripes were unified in their condemnation of the coup and the suspension of Honduras from the OAS did two things: It made clear that no matter how many people dislike the president, coups are no longer accepted in the region. And it also helped push this crisis toward mediation.

Another critical role the OAS played in the last week was in monitoring human rights. The Inter-American Commission on Human Rights followed up on reports of violence, compiled detailed lists of individuals at risk or missing and monitored restrictions on freedom of the press and association.

In conclusion, there is a mediation process now in place, and I think we should all be supportive of President Arias as this process moves forward.

And there can be opportunity in crisis.

The question is, will the end result of the mediation be a limping along of democracy until the next election, or some real introspection on both sides about the more fundamental crisis of Honduran democracy and the existing political parties?

Thank you.

REP. ENGEL: Thank you.

Dr. Arnson.

MS. ARNSON: Thank you very much --

REP. ENGEL: Pull it closer and turn it on.

MS. ARNSON: -- Mr. Chairman, for this invitation. I would also like to ask that my remarks be submitted for the record.

I'd like to say --

REP. ENGEL: Without objection, so ordered.

MS. ARNSON: Thank you -- that I welcome the subcommittee's focus on Central America, a continuation of the historic role that this subcommittee played during the Central American wars in the 1980s and their subsequent resolution in the 1990s.

As the opening statements demonstrated, mostly by the members of the subcommittee as well as by members of this panel, every crisis and every conflict reflects deeply contrasting narratives regarding relevant facts. What I will attempt to do in the short time that I have is not so much to rehash those facts, but perhaps to provide a broader context for understanding these disparate realities.

The crisis of governance reflected in the coup against President Zelaya has both proximate and deeper antecedents. The proximate cause, as we've heard several times this morning, was Zelaya's insistence on a national referendum that the Honduran congress as well as the supreme court considered illegal and unconstitutional. The end game of that referendum would have been to permit changing the constitution for Zelaya to extend his term and eventually, one supposes, to convene a constituent assembly to draft a new constitution. Should these changes have taken place, Honduras would indeed have embarked on a path similar to those taken in Venezuela, Bolivia, Ecuador and, to a lesser extent or earlier, in Nicaragua, where elected presidents have spearheaded processes of constitutional reform that erode checks and balances, strengthen the power of the executive branch and create alternative participatory mechanisms for the exercise of so-called "popular democracy."

Quite apart from the immediate sequence of events, the Honduran crisis has deeper roots. They can be found precisely in the weaknesses and limitations that make the populist temptation in Latin America not only attractive but also feasible: the weakness of the Honduran democratic -- of Honduran democratic institutions, the inadequacy of mechanisms of representation and the failure of Honduras's economic growth and international insertion in the last several years to overcome the country's endemic poverty and inequality.

The coup and the military's role in throwing Zelaya out of the country reflect the Honduran political system's inherent weakness and the absence of mechanisms and a legal framework to resolve political conflict through political means. Overcoming this basic crisis of governance must be an essential feature of any long-term and enduring solution to the current and highly unstable impasse.

The acceptance of President Oscar Arias as a mediator in the crisis is extremely positive, even though the events of the last few days have shown that this will not be an easy -- an easy mediation. President Arias has broad credibility in the region, as well as world- recognized experience in brokering peace. And I think it's worth mentioning and underscoring that the Central American peace plan that he devised in the 1980s linked the end of civil war to internal democratic reforms as an essential ingredient of peace.

The Obama administration, I believe, has acted appropriately and even admirably in response to the crisis. They have honored their commitments at the Summit of the Americas to work in partnership and look -- and seek multilateral solutions to regional problems. The support for the efforts of the OAS and now for President Arias reflect an understanding of the value of partnership over unilateralism.

I also believe that the Obama administration has been appropriately restrained and prudent with respect to the elimination of U.S. economic aid in response to the coup. The example of Haiti should stand as a sober reminder of the harsh economic -- of the consequences that harsh economic sanctions against a desperately poor country can have.

I'd like to conclude by saying that the Honduran crisis should serve as a wake-up call, to the extent that it might still be needed, that despite huge advances in electoral democracy in Latin America over the last two decades, the quality of democracy and the scope of social inclusion remain deeply flawed and, at times, fundamentally compromised. Supporting the capacity of democratic institutions and fostering strategies for inclusionary growth remain the central challenges, even more urgent at a time of economic hardship and reversal.

Thank you.

REP. ENGEL: Thank you.

Mr. Davis.

MR. DAVIS: Thank you, Mr. Chairman and Ranking Member Mack. I'd like to first say that it is a pleasure to be here in the presence of friends on both sides of the aisle. I see Congressman Delahunt, who I knew before his hair was gray, and is a great public servant -- a great public servant. And I see Congressman Dan Burton, who at some point in my past career, I was at times an adversary, but always friendly, always civil, and of course my friend Chris Smith, who I consider a very close personal friend. And Chairman Engel and I happen to also be personal friends.

And the reason I wanted to start out that way is that this issue calls for bipartisanship, calls for civility and calls for dialogue. And I represent a client, so I'm not speaking for myself. There are days when Dan Burton and I debated on television where I was speaking for myself. But I am speaking on behalf of the Honduran Chapter of the Business Council of Latin America, called CEAL, C-E-A-L.

And like Justice Perez, I'm here to talk about solutions, as our great president reminds us, looking forward, rather than looking backward.

And I believe Chairman Engel and Ranking Member Mack have essential agreement on two things. One is Mr. Zelaya violated the law. There is no doubt. Facts are facts. With all due respect to my co-panelist, Ms. Olson, no, there wasn't a lot of lawbreaking going on. The supreme court voted 15 to zero that Mr. Zelaya broke the law. That included eight members of his political party elected justices. The congress, 124 to 4, including all the members of his political party, voted that he violated the law. His own attorney general, the human rights commissioner that is as independent of the government as the GAO is, has supported the finding that he had to be removed from office because he violated the constitution with a self-executing clause that says if you try to extend your term, you are automatically removed from the presidency.

Now, having said that, my clients believe that looking back with the wisdom of hindsight, it could have been done differently that night that the army decided to whisk him out of the country. And I'm not afraid to say that, with the wisdom of hindsight, it probably should have been done differently.

As long as those of you -- and I know Congressman Delahunt shares that view -- are also willing to share the distaste for a president that regarded himself as above the law and every institution in Honduran society, from the church to civil organizations to business organizations to the liberal party to the national party to the supreme court and the congress -- every institution found this president as putting himself above the law -- if both facts are stated by my friends on the Democratic side where I am affiliated and my friends on the Republican side, we can then look forward, as President Obama and Secretary Clinton want us to do, and not argue about past history. So now let's look forward together.

Secretary Clinton -- Secretary of State Clinton did a great service in turning to President Arias, a Nobel Prize winner, and saying, let's have dialogue and let's find a solution, one that is going to take time, that doesn't involve immediately power-shooting Mr. Zelaya back into Honduras, one that recognizes that there is a compromise necessary on all sides. And my client favors such a compromise, and that is about dialogue.

And finally, whatever the solution, it cannot be imposed by the OAS, the United States, by my friends who are Democrats and my friends who are Republicans. It has to be a Honduran solution. Right now, every institution in Honduras and every public opinion poll taken supports this civilian government -- there is no military running this government -- supports this civilian government but also wants a peaceful solution. But it's got to be a Honduran solution between the leaders of Honduras as well as Mr. Zelaya. And under the auspices of President Arias and Secretary of State Clinton, I can see no better way than dialogue and ultimately a peaceful solution.

Thank you, Mr. Chairman.

REP. ENGEL: Thank you very much.

Ms. Stephens.

MS. STEPHENS: Does that work okay?

REP. ENGEL: Yes.

MS. STEPHENS: Thank you, Chairman --

REP. ENGEL: You can pull it closer, if that might be easier for you. What's ever -- what's ever easier for you.

MS. STEPHENS: Thank you, Chairman Engel, Ranking Member Mack and members of the subcommittee for holding this hearing on the crisis in Honduras today.

I'd like to begin by simply expressing my sympathies to the people of Honduras for the violence and political turmoil they've experienced since June 28th. It is understandable and perhaps inevitable that their crisis has triggered a larger debate about policy and politics, democracy and diplomacy. But neither their humanity nor their dignity should be forgotten as we discuss the implications of the coup for all of us inside and outside Honduras. In fact, their interests and ours are in alignment.

In that context, let me make three basic points. First, I believe that the goal of our policy and our diplomacy should be resolving this crisis in a manner that restores the constitutional order to Honduras and returns President Zelaya to office. Second, we need to stand with the region in saying loudly and clearly that military coups cannot be regarded ever again as acceptable alternatives to democracy. Third, we need to understand that there's a principle debate occurring in the Americas about democratic institutions and the constitutions which protect them. At times, some nations will make choices through democratic means that may disturb and discomfort us deeply, but our long-term interest in democracy and stability in the Western Hemisphere can only be vindicated if, by our words and actions, we are seen as respecting rather than undermining their sovereignty and their decisions.

While we may disagree about some of these issues, I would hope that we could speak with one voice on whether it was appropriate for military force to be used against the presidency of Mel Zelaya. After all, the top legal adviser for the Honduran armed forces told the Miami Herald, "We know there was a crime there." And I would say, so do we.

Similarly, Edmundo Orellana, a congressman who served as Mr. Zelaya's defense minister and resigned from his position just days before the coup because he believed Mr. Zelaya was breaking the law, wrote Congress this week that President Zelaya's ouster was illegal and that he would refuse to take his legislative seat until Mr. Zelaya was reinstated.

This drives home the most important theme of the recent events in Honduras. Regardless of ideology or one's opinion of President Zelaya's behavior prior to the coup, can't we say this with clarity? Coups are wrong. They're undemocratic and they taint the hands of everyone who touches them. When violence becomes a substitute for politics, everything falls apart. That has been the sad story in many places across Latin America, and that's why so many people in the region are as proud as they are today for having tried to put that history behind them.

As President Lula said recently, "What we have achieved in these years was, in truth, the result of the deaths of many people, many young people who decided to take up arms to bring down authoritarian regimes in Chile, Argentina, Uruguay, Brazil, in almost all countries. They died, and we are doing what they dreamed of doing, and we have won this by democratic means." None of us want to see that progress rolled back, which is why being clear about why this coup is unacceptable is so important to the region and to our national interests.

Against this backdrop, it is extremely important that President Obama has taken the position from the inception of this crisis that reversing the coup and returning President Zelaya to his nation and to his office were political and diplomatic priorities for the United States. As he said just three days ago during his trip to Russia, "America cannot and should not seek to impose any system of government on any other country. Even as we meet here today, America supports now the restoration of the democratically elected president of Honduras, even though he has strongly opposed American policies."

Against the expectations of some in the region, the United States has reacted with prudence to these events, and that strengthens us and our long-term interests in the Western Hemisphere.

The crisis in Honduras came at a particularly crucial moment. There are debates taking place in Latin America about the role of the state and what democracy should do when their institutions fail to deliver what their people need and want. This is hardly a new phenomenon. Governments of all idealogical stripes have rewritten their constitutions in Latin America for decades, for centuries. This is not a question, as some would have it, simply of left versus right. Colombia is discussing right now whether President Uribe will have the chance to run for a third term.

Nor is it only a debate about centralizing power in the executive. Nations do this to improve governance, to end exclusion and to open opportunity. As Jennifer McCoy of the Carter Center pondered recently, does democracy allow for its own renewal, living within the rules of the game?

There are real and legitimate questions about when that does get out of hand, but we have to be very careful, in light of the region's history and ours, about how and when we ask those questions. These are serious issues, and we place a lot at risk if we treat them lightly.

We should support democracy in places like Honduras not only when we like the choices the people are making, but also when they use elections rather than violence to make those choices for themselves, even when we disagree with the outcome. We share a common border with this region and confront a common set of problems -- diseases, criminality and security, environmental challenges and proliferation. None can be solved without us being good partners -- not by imposing, but by listening and operating multilaterally.

If we identify with their democratic aspirations, our country will be much more successful in the region moving forward. It is that interest and those concerns which I believe are at stake for us in the crisis in Honduras today.

Thank you.

REP. ENGEL: Thank you very much.

Mr. Reich.

MR. REICH: Thank you, Mr. Chairman and members of the committee. I appreciate, again, this opportunity to speak with you. And I'd like to submit my complete remarks for the record.

REP. ENGEL: Without objection, so ordered.

MR. REICH: The current battle for political control of Honduras is not only about that small nation. What happens in Honduras may one day be seen as either the high-water mark of Hugo Chavez's attempt to undermine democracy in this hemisphere, or as a green light to the continued spread of Chavista authoritarianism under the guise of democracy.

The removal of President Zelaya from office two weeks ago has been referred mainly outside of Honduras as an attack on democracy. In contrast, prominent Honduran jurists and scholars who are not members of the government describe it in the exact opposite fashion, as a legal and defensible measure of two co-equal branches of the Honduran government against the autocratic intent of the executive. Many Hondurans insist that these actions save democracy by preventing Zelaya from establishing the kind of 21st-century socialism that is being established in countries of Latin America under something called the ALBA, an alliance invented by Castro and financed by Chavez.

We must find a bipartisan way to defend the true democrats in Honduras. I respectfully suggest to this Congress that one way to do so may be to ask the elected representatives of the people of Honduras, their congress, why they voted -- I had 125 to 3, but it turns out that I hear now it's 124 to possibly 4 -- for the removal of Zelaya? Either way, the equivalent of that vote, in this House of Representatives, would have been about 415 to 11, with a few abstentions.

You, our representatives in Congress, more than anyone, know that when nearly all freely elected members of a nation's congress gives such bipartisan support to such a momentous measure there must be an unusual reason. In Honduras that reason was genuine fear for the future of the country.

I freely admit that I'm not an expert on Honduran law and, therefore, not qualified to judge the legality of this action.

I would also point out, however, that most in this country, and other countries, who have rushed to condemn the Zelaya removal are at least equally unqualified to judge it.

How can this so-called democratic community allow Cuba, Venezuela, Bolivia, and other countries that have either destroyed self rule or are in the process of doing so, to determine the standards of democracy in the region?

ALBA has a consistent modus operandi: Subvert the foundations of self rule, such as free elections and referenda; gain power, concentrated in the hands of the executive; steadily diminish civil liberties; and then change the rules, and even the definitions of democracy, to remain in power indefinitely through any means necessary, including force.

In my opinion, what took place in Honduras on June 28, when the military removed Zelaya on an order of the supreme court, should have been handled differently. As an American, I would have liked to have seen Zelaya's charges better publicized in advance of the arrest; to have seen civilian authorities, not military forces, arrest Zelaya; I would not have expelled him from the country, but would have detained him and given him the opportunity to defend his actions like any other accused felon.

But, I'm not a Honduran. I did not feel threatened by Zelaya's increasing authoritarianism, as did the Honduran congress, for example. I did not fear the undermining of my country's democratic institutions by Zelaya, as did the Honduran supreme court. I did not know the extent of interference by Venezuelan, Cuban and other foreigners in the internal affairs of my country, as did the Honduran armed forces.

Had I been a Honduran -- not living peacefully in the United States, as most of us in this room do, I would have heard the exceptional denunciations of the Catholic Church and the Protestant churches protesting Zelaya's abuses of power. At the same time, however, one does not have to be a Honduran to understand the anger of the average citizen at the documented and repeated instances of gross dishonesty by (Mel ?) Zelaya, his family and members of his cabinet.

I cannot excuse the zeal with which the military broke into Zelaya's house. But, it may be explained by Zelaya's illegal misuse of the police and military to take over private properties, deny access to rightful owners, and thus benefit his extended family. To use the forces of the law to commit unlawful acts is immoral. That may also explain the church's condemnation of Zelaya.

Commendably, the legal adviser of the Honduran armed forces, as has been mentioned here, admitted the law was broken in expelling Zelaya, an action they, the armed forces, justified as taken to prevent violence. When was the last time the legal adviser of Chavez or Castro's armed forces -- assuming they even have such a position, admitted a criminal error in handling a case?

I will submit the balance of my remarks for the record, Mr. Chairman, but in conclusion, let me say that it's always an honor for me to asked to testify before the U.S. Congress, because I've never taken the freedoms this country has afforded me for granted. I'm an immigrant -- a Cuban-American who lived under two dictatorships in his native country, then saw it enslaved by communism.

I've been privileged to serve our government in and out of uniform for over 15 years. I fervently exercise my civil rights because I once lost those rights and know how precious they are. I urge this Congress not to condemn Hondurans for defending theirs, even if we may not approve of the one mistake to which the military have already confessed. Thank you very much.

REP. ENGEL: Thank you very much.

Let me say that we can see that our very distinguished panelists and excellent testimony -- composed of a wide range of views on the subject, and I think that we've heard a lot of good points from a lot of different people. For me, I think the question that I'd like to concentrate on is where do we go from here?

Obviously, there's negotiations going on with Mr. Arias. And the United States, as was mentioned, has been instrumental in putting together those discussions. Secretary Clinton has been very helpful in doing this.

If I could close my eyes and say, well, what kind of possible solution or compromise can come out of these negotiations, I would bet that the most probable thing to come out would be a return to power of Mr. Zelaya to finish out his term, which I believe is four more months; and then have a new election, as was scheduled in Honduras in November -- (audio break) -- has been stated by the Honduran constitution. I would bet the house that that would be the solution that would come out.

I'd like anyone's comments on that. Would that be a viable compromise? And is it something that you think would be likely to come out of these discussions? Any want to try it?

Mr. Davis?

MR. DAVIS: Mr. Chairman, the first thing I'd like to say is I'd rather not offer advice to the parties as to how to solve this. But, I can offer some principles that are in alignment with what you just said and what my clients believe.

The one principle most important is the rule of law needs to be upheld. So, any solution that involves the return of Mr. Zelaya, if that's the choice --

REP. ENGEL: Mr. Davis, would you just hold for a minute.

I notice in the audience there are some signs. And I would please ask the people to put those signs down because I think it's inappropriate. Thank you very much.

Mr. Davis.

MR. DAVIS: So, in alignment with really most of the remarks heard on both sides of the aisle, and certainly with yours, Mr. Chairman, there are two principles that I certainly believe that Mr. Zelaya, Mr. Micheletti and President Arias are aimed at discussing:

One is that the rule of law is very important. Mr. Zelaya needs to acknowledge that, and certainly needs to acknowledge that the supreme court, his own party in the congress, and all the other institutions have found him to have violated the law and he has to be held accountable; as do the people who may have violated the law by sending him out of the country in the middle of the night. So, there may be a solution that is equal-handed about forgiving both of those violations in return for certain commitments. But, the principle is the rule of law.

And the second principle is democracy, and security that goes with the democracy. And the elections, as you mentioned, must take place. And there must be a new president -- someone from his party is running, and someone from the opposition party, national party, and three other parties are running.

So, those two principles: the rule of law, and some agreement on how the rule of law is to be applied equally; and democracy and security. I believe that President Arias can bring the parties together to achieve those two principles.

REP. ENGEL: Thank you.

Dr. Arnson, I noticed you had your hand up.

MS. ARNSON: Once again, I think the interpretation of what constitutes the legal solution in Honduras is a contested issue.

I would share Mr. Davis' reluctance to define, as a U.S. citizen, how Honduran politicians and how the Honduran public should resolve this crisis. But, I frankly find it improbable that a resolution to the crisis could be found that does not include President Zelaya's return to Honduras. At the same time, what he attempted to do -- that the supreme court and the congress have found in violation of the constitution, should not be allowed to take place.

I think it might be entirely reasonable -- to prevent deepening polarization between now and the month of November, to attempt to move up those elections; make sure that they are fully observed, not only at the time of the balloting but before and in the period afterwards, to guarantee that the political process goes forward in an open and democratic fashion, without intimidation, without violence.

I would think that there may be some role for an international observer mission, under the auspices of the OAS or the United Nations, to establish itself in Honduras as a international mechanism to help Hondurans overcome polarization.

I believe that the country is deeply divided, probably equally in favor and against President Zelaya. I think that, and I just agree with what was said earlier, I think that a majority of Hondurans -- not a majority, but a plurality oppose the way in which he was removed.

And I hope that what Mr. Davis has described as the need to look forward, and not to become entrenched in the positions and principles that have been articulated up until now, will be possible, because adherence to those deeply entrenched positions will lead to a continued stalemate. And I think what's needed is a way for both sides to be flexible in order to break this impasse.

REP. ENGEL: I think that one of the things that I hear again -- you know, people are arguing that President Zelaya's removal from power was constitutionally appropriate. The troubling thing -- and even people who, in the panel who are saying that President Zelaya violated the law, I mean, can anybody tell me where in the Honduran constitution it gives the military the right to remove a president from power at gunpoint and whisk them out of the country?

I don't think that anyone differs with me on that. I don't think that there is anything in the Honduran constitution that would give the military that power. I see people shaking their -- nodding their heads. So, I think that that is something that is troubling.

But, I do think that the United States can play, and should play a very positive role in trying to mediate these results.

Mr. Mack.

REP. MACK: Thank you, Mr. Chairman.

You know, first of all, I appreciate the testimony from everyone. And, you know, it's such an important hearing, because what we're trying to get our arms around is democracy in Latin America.

And not all constitutions are written the same. But, it is clear -- and you don't have to be an expert, as someone mentioned on the panel -- one of my colleagues mentioned earlier, to understand the Honduran constitution. You just have to read it.

And it is clear, in Article 239 of the constitution of Honduras, that by the order of the supreme court -- which we have, which we can read, which says to arrest the president -- that the military was just acting out the constitutional responsibility passed to them by the supreme court. I don't -- it's not that hard to figure out. You don't have to be a scholar. You just have to read it.

This idea that this is a coup is so disturbing to me. That you would -- could say with a straight face, after hearing the testimony from the panelists and the members that sit up here, the military is not in charge of Honduras. Therefore, you cannot have -- it cannot be a military coup. The military acted on the rule -- on the order of the supreme court.

So, I think we need to -- someone needs a paradigm shift. Someone needs -- people need to understand, and stop calling this a coup. The negotiations that are going on right now, if at the base of that is that this is a coup, it's going to be very difficult to get to a solution that follows the constitution of Honduras. And anything other than something that follows the rule of law and the constitution of Honduras sets a horrible precedent.

Mr. Davis, I was very interested in your testimony, and I understand it's on behalf of your client. So, I want to ask you this: Does your client believe that this was a military coup?

MR. DAVIS: My client wants me to answer that question based on the facts, and the facts are there is no military person in charge of this government. The government is now, de facto, being run by the successor, under the constitution, the president of the congress. So, the word "military" would be inappropriate as far as my clients are concerned.

On the other hand, I think my clients would agree with the chairman that there's nothing in the constitution that allows somebody to be shipped out of the country in the way that it was done. So, the wisdom of hindsight is not about his removal as president. That, under Article 239, as you said, is expressly stated as an automatic -- he automatically loses office under the wording of that constitution.

And my colleagues here, who talk about democracy, seem to want to ignore a constitution adopted, after military governments in Honduras ruled, in 1982. And that constitution is as sacrosanct to Hondurans as ours is. So, the constitution said he had to be removed; the supreme court, 15 to 0, agreed; and so did all the members of his party.

But, the issue of whether she should have been whisked away in the dead of night by the army is what's troubling, and it is not an easy issue to dismiss. And, from my client's standpoint, they're troubled about that. And I can only say that what I'm authorized is the wisdom-of-hindsight statement that I made: It should have been done differently.

But, just remember the context: The president of Honduras led a mob -- the president himself, you can see it on YouTube, led the mob that overtook the army guards into the barracks to seize ballots that had been shipped in by Mr. Chavez. Now, that's just a fact. And the atmosphere was fearful of physical safety. And it was that context that I believe, with the wisdom of hindsight, something was done that should have been done differently.

REP. MACK: Thank you, Mr. Davis. And I agree with that. I agree with your statements.

I would say this: That if the supreme court, the congress, the business groups, the churches, if all of these groups came together to say that the removal of the president was the right thing to do, certainly they could also come together to say, 'we don't think he should have been flown out of the country.'

And Hondurans could have figured out the right course to go to make sure that that didn't happen again, that their constitution was followed, that the rule of law was followed, but to also make the statement that, in the future. they won't be flown out of the country.

REP. ENGEL: Thank you -- (inaudible) -- your time is expired.

Mr. Meeks.

REP. MEEKS: Thank you, Mr. Chairman.

I want to thank all of the witnesses for being here at what is a very important hearing. And I think that, you know, it gives us a lot of food for thought. And I don't want to jump ahead of ourselves, because I do believe that what President Arias is doing -- and, you know, sometimes I'm trying to look at the prism, whether the glass is half full or half empty.

Some people are saying that democracy throughout South and Central America is being threatened. Well, democracy in the Honduras may be, but the reaction of the countries in Central and South America who are upset about what has taken place -- which has caused them to sit down and try to work together to resolve this so that we do not turn back the hands of time, shows that we still have come a long way; shows that there's still -- that folks even in the region want to work together to make sure that democracies reign; and, hopefully, will also show that those democracies (were ?) assuming that those who have not had for such a long period of time; because the bottom line here are still those poor people in the Honduras, one of the poorest nations on the hemisphere, who, no matter what the system of government, has never received anything.

So, the hope is that we've learned something and that we move forward. And I think that also what is different here -- and one of the things that the prior administration had been criticized, and looked about all over the world in the wrong way, is acting unilaterally. I think the fact that this current administration, acting in a multilateral situation with other nations that's concerned in the region, is a positive step forward to trying to make sure that democracy does remain and prevails, throughout this hemisphere especially, but throughout the world.

Now, I do have -- and I'd just like to ask some questions, you know, that I don't know, in my -- just to get your opinion in this scenario, because I'm concerned about those poor people. And I'm also concerned because you see some human rights groups talk about the individuals who were out there demonstrating. They were, you know -- with the interim government who's there, but there's been some things that's going on with them.

But, we have decided, as far as the United States is concerned, to suspend all foreign aid to the Honduras, including the Millennium Challenge Account and other things. I'm concerned about the poor getting hurt more. I don't know, I'd like to hear your opinion whether or not we should continue that suspension, or whether we should do something differently so that we can make sure that those who are caught in the middle here -- the poorest of the poor, are not hurt.

What do you think that we should do, as the United States, in that regard? I'd be -- I'd like to hear -- (inaudible) -- that.

Ms. Olson?

MS. OLSON: Just to clarify, because I looked -- I looked into this matter.

In 2002, the "coup" language, this 7,008 clause I was referring to, was changed so that the suspension is not to the country but it's to the government. So, all aid is not suspended to Honduras right now. The only aid that's suspended is the portion of the aid that's given directly.

And, because of the way the U.S. gives foreign assistance -- with much of it being executed by non-governmental agencies, actually the total amount is not that large. I think that's of very little legitimate and important concern.

Could I address one previous issue, just very briefly?

REP. MEEKS: Go right ahead.

MS. OLSON: I think that if the scenario had played out -- and that the supreme court ordered the arrest of President Zelaya, the president was arrested by the legitimate authorities tasked with arresting people, and that he was put in jail and that proceedings were taken against him -- that would have been --

REP. MEEKS: I agree.

MS. OLSON: -- completely legitimate.

REP. MEEKS: Absolutely.

MS. OLSON: And, for me, the issue is not right now: Does the military run the country? The question of a coup is not who's running the country entirely at this moment, the question is: Was the president illegally deposed? And, actually, the 7008 language, of Section 7008, talks about a military coup or decree. So, it sees -- it sees the coup concept beyond just the military taking over.

So, the other thing is, is that if you're going to talk legality and illegality, if you illegally remove the president from the country then aren't the people taking over, in some ways, violating the law as well? So, I just -- that was my point about -- it seems like there's a lot of things that could be, have questionable legal -

REP. MEEKS: Well, I agree. And that's why I used the hypothetical earlier in my opening statement that, had we not had the process taking place -- and I've got 30 seconds, I see the gavel, (laughs) -- you know, that we could have taken, or someone could have said President Nixon was, violated the law and just take him out of the country.

But, generally, if you violate the law, and you have the rules, you do come in, you arrest someone, you place them under arrest. And, therefore, there's a proceeding that takes place so that one can be found guilty or innocent, not just summarily. That seems to me to be more of a democratic and fair way to go. That did not take place here.

So, in my estimation, by any stretch of the imagination, a coup did take place.

REP. ENGEL: The gentleman's time has expired.

Mr. McCaul.

REP. MCCAUL: (Off mike.) -- thank the Chairman.

I think we've reached some consensus but not entirely. Clearly, the president violated the constitution. The supreme court held so -- held that he was acting against the established form of government. We have an order here to the military to arrest him. He was ordered to be -- he was found to be in treason against his own country; abused his authority; and usurped his power.

As Mr. Davis pointed out very eloquently, when Article 239 self- executes, once that is violated -- which it was in this case, he is out of power. He is no longer the president of Honduras. I think that the real dilemma here is how was this order implemented, and how did the military respond to this order to arrest him; and does the definition of arrest include deporting him to another country?

I know there are some concerns, certainly. when we have the intervention of Hugo Chavez into the process, and the intervention of these ballots from Venezuela, tremendous concern of the safety and the danger that's posed by keeping him in Honduras.

We've been throwing around the word "military coup" pretty loosely. But, as Mr. Meeks points out, it's actually very important, because under the -- under this appropriations act that we passed, if it's defined as a million coup then the funding is cut off to Honduras by the United States Congress.

So, I think that definition and I think again this has been thrown around very loosely, but the idea, you know, that there was a violation of the Constitution. The Supreme Court held so, called for the arrest. Article 239 self executes. He's now a private citizen in my view.

The real issue with him lies with what's a remedy that we can provide to him in terms of from this point going forward. But he is no longer the president under the rule of law in Honduras and under their Constitution. So Former Supreme Court Justice Perez-Cadalso, I wanted to call upon you and perhaps Mr. Davis as well to help us in the Administration in terms of whether you define this as a military coup.

MR. PEREZ-CADALSO: Thank you, Congressman. Back in the '60s and '70s, Latin America was full of coup de tas. I myself lived through many of them. But reading any text of political science, one finds that the coupe de tas have some characteristics. One, the military seize power, and they take power or they do a civic military junta. Second, they abolish the other powers or the branches of government, certainly Congress and sometimes even the judiciary.

Third, the Constitution is abolished or is subject to whatever the military regime wants. Fourth, usually there's a bloodbath that occurs with the takeover of the military. In this case, we have a very atypical situation. One, the military are not in power. There's a civilian ruling the country. The military have returned to the barracks.

Second, the three branches of government are functioning. The Congress that was elected four years ago with President Zelaya, the judiciary with its 15 members and the branch of government, the Executive branch of government that was elected by Congress in this case, 124 votes out of 128. The Constitution is fully in charge. Nobody has questioned the Constitution. And fortunately for us Hondurans, there was no blood shed in the moment that Mr. Zelaya was arrested.

REP. ENGEL: I'm going to -- the gentleman's time has expired. And as you've heard, we've just been called for a vote. So I'm going to try to see if we can finish before the actual vote takes place. I'm going to ask my colleagues if they could limit themselves with their question to maybe one quick question for about two minutes.

REP MCCAUL: Let me just say thank you for that testimony as well.

REP ENGEL: And Mr. Green.

REP. GREEN: I'm going to try and squeeze two questions in two minutes. First of all, on July the 3rd, the Inter-American Commissioner on Human Rights issued a statement about deep concern over Executive Decree 0112009 from the authorities in Honduras restricting personal liberty and allowing incommunicato detention for 24 hours, freedom of association, the right of assembly as well as freedom of movement to enter and leave and remain on the territory of Honduras. Would any of the --- is that still in effect, or does that have any concern like it does, I think, with a lot of members that international emergency that was created and continuing? Ms. Olson?

MS. OLSON: My understanding is that the suspension of liberties during certain hours of the day which was put forward has been reduced over the past couple of days. I haven't checked -- I didn't check yesterday. So I'm not sure. We have been concerned about it, yes. And one of the big things we've been concerned about and that I think is a second thing's allowed has been the restriction of media. Pretty much all of the opposition media were taken off the air -- off the air, and they weren't showing up in print. So you ended up with a real kind of one-sided view of what was going on.

MR. DAVIS: Actually, Congressman, that's not a correct statement. It happened very briefly. All the media is operating as we speak. There are vociferous protests on both sides. Democracy is flourishing. I do agree that the curfews are the only thing in place that are night time curfews. But as to any civil liberties as far as I know from a distance, the answer is democracy and civil liberties are still flourishing.

REP. GREEN: Well, let me get my other question quickly. The change in constitutions and power in the western hemisphere, and I know there are other countries, Colombia, Venezuela, Bolivia, Ecuador, Honduras, is that fairly common? It seems like, though, except for Colombia, we hear it from people who are mostly aligned with President Chavez in Venezuela. Is that a general correct statement? You don't want to extend the terms of office by public referendum, Mr. Reich?

MR. REICH: Mr. Green, as I commented in my testimony, that pattern of certain elected leaders coming in through an election, as Chavez did ten years ago, as Zelaya did four years ago, as Correa of Ecuador, as Morales in Bolivia --

REP. GREEN: Frankly, I think President Uribe did the same thing, I believe, in Colombia.

MR. REICH: No, really he's not done that. He has presented that. He hasn't decided yet whether he's going to run. The Constitution was changed in Colombia, that's correct, to allow a second term. I personally -- I mean my personal opinion -- I'm not a Colombian, so I didn't vote on that one. I don't think that that's good. I don't think it's good for Colombia any more than I think it was good for Honduras or that it has been good for Venezuela or Bolivia or Ecuador or the others.

But that's just my personal opinion and based on 40 some years of working in Latin America where, you know, some countries, for example, like Mexico have made it part of their constitution there is no reelection because they know that unfortunately for some reason, cultural reasons or political or whatever, once people get into power, they don't want to give it up.

REP. ENGEL: I'm going to let that be the final word for this question. Mr. Smith.

REP. SMITH: Mr. Chairman, thank you. You know, as the crisis in Honduras was heating up, I was actually in Minsk, Belarus meeting with President Lukashenko, the last dictator in Europe, and he's the man who was elected. His august Parliament rewrote the Constitution to allow him to be president for life. And I remember thinking not again, not again, not again, and we have it happening now where it almost happened in Honduras.

My question is Zelaya has been accused of several very serious crimes including treason, abuse of authority and usurpitation of power. The Supreme Court has voted unanimously, as everyone has said here. All of the democratically elected institutions of that government are trying to uphold the rule of law.

Now as Dr. Ares (ph) grapples with this whole issue of what to do, it seems to me one of the top questions has to be should Zelaya be prosecuted. I don't know how those kinds of charges just get swept under the table. People in Honduras, in the United States and every other country want the rule of law to be upheld. Serious charges have been leveled. I believe he should be prosecuted. I would like to know, starting with you, Dr. Perez or Justice Perez, what do you think.

MR. PEREZ-CADALSO: I was -- before the question had been posed about the return of Mr. Zelaya to the country, that of course will be put forth in the mediation table. But the problem will be, too -- I'm almost sure that that's going to be put forward and for him to return as president. The thing that would worry any Honduran that respects the rule of law would be that if he returns, if things follow the legal trend, he will be arrested when he gets to Honduran soil. He has to be arrested if we respect the rule of law. There's a warrant for his arrest. So that poses a problem in the mediation.

And the other problem would be his governability. How would he be able to govern in a country that has a majority of the institutionality that is opposing him. Everybody onl this panel has talked about not only the judiciary, the Congress, the Human Rights Commissioner, the Attorney General, the Catholic Church -- everybody has expressed that he was in contempt of law, that he was beside the law and that he should be prosecuted especially because he was rebellious with all the orders that were issued by other instances of the judiciary power.

REP. ENGEL: Thank you. I think we're going to have to let that be the last word on this question. Mr. Payne.

REP. PAYNE: Yes, let me ask you very quickly. I hear the business people, the Catholic Church, everybody else have condemned this. I understand that the minimum wage was raised, that a lot of indigenous people were supportive, that the Afro-Hondurans -- can anybody speak about that group? I haven't heard them mentioned. They were in support of this coup. They wanted him out, a person who raised the minimum wage, a person who came to New York to swear in an organization called the Central American Black Organizations made up of people of African descent throughout South America to show the respect to that organization. Does anybody have any of the indigenous or minority people's position quickly?

MR. DAVIS: Well, four of the five political parties including the party representing many of the unions, many of the poor people simply upheld the law, Congressman, and found that he violated the law. But if I may say, I would hope you would not support a cut off of aid which will hurt the poorest people in Honduras and to have the United States government cut off aid where the people who would suffer are the people who are least able to cope with the cut off of that aid. I hope that both Democrats and Republicans would not support a cut off of aid at this very important moment.

MR. PAYNE: Well, one thing, we do have to discourage military coups, and much of the aid goes around the government. And so I certainly couldn't see us continuing giving support to someone who was taken out of office by the army. And I just want to conclude because my time is about up that I'm just certainly -- I'm outraged by the representation of the new government with your Foreign Minister who have --

MR. DAVIS: He's been forced out, Congressman. He's no longer --

REP. PAYNE: Okay, but he must have reflection of the group because when he says three times about this new little black man who's the president of the United States, and then talked about, as Mr. Delahunt -- I've negotiated with queers and prostitutes, leftists, blacks and whites. That is my job. However, I like this little black sugar plantation worker who is president of the United States.

I don't want to sound like I am prejudiced, but a statement like that certainly offends me.

MR. DAVIS: Congressman, he's not a reflection of anybody. He was sacked. He is a far-out extremist bigot and there is nobody in the Honduran government that didn't support him being sacked.

REP. PAYNE: Who appointed him? The same guys that took out the former president? They must have put him in.

MR. DAVIS: Well, he got sacked.

REP. PAYNE: Well, he got in.

(Laughter.)

MR. REICH: May I add, Mr. Payne, that Hugo Chavez used exactly the same term to describe President Obama?

REP. PAYNE: Well, I'm talking about, you know, this country. I should have raised it then. I didn't hear it from Chavez, but --

MR. REICH: It's reprehensible no matter who says it.

REP. PAYNE: Right. I agree.

MR. REICH: Whether it's left or right --

REP. PAYNE: No, I agree, but --

MR. REICH: At least in the case of Honduras the foreign minister was fired.

REP. PAYNE: Ms. Lee's time -- is not going to have any time, so I'm going to yield.

REP. ENGEL: Thank you.

Mr. Rohrbacher.

REP. ROHRBACHER: Yes, I think that was a very good point that Ambassador Reich was about to make. Yeah, let's have one standard. And one standard has been Hugo Chavez says something and you condemn him as much as you're condemning some guy that this group sacked because they didn't want to have anything to do with that type of language.

Mr. Reich, or Mr. Ambassador Reich, I should say, didn't Mr. Chavez himself lead a coup d'etat in 1992?

MR. REICH: Yes, sir. That was a coup d'etat. There was no question.

REP. ROHRBACHER: And was his plan to put in power himself, who was a military man, or was his idea to put another democratically elected person into power?

MR. REICH: It was to put the military in power to replace an elected president who had not broken the law, President Carlos Andres Perez.

REP. PAYNE: And so Mr. Chavez, the greatest ally of this would- be Cadillo (sp) in Honduras, himself conducted a military coup against a democratically elected government.

MR. REICH: Well, there is no question there is a double standard. I'm glad, for example, Mr. Shifter referred to the double standard the OAS --

REP. ROHRBACHER: Right.

MR. REICH: -- has been carrying out for the last several years of overlooking the violations of civil rights by governments of the left, the very weekend that we were discussing here in this city what to do with the government of Honduras, which has been described here as having trampled on some civil rights.

Hugo Chavez announced he was closing down 240 ration stations in Venezuela. I didn't even see that reported in the U.S.

REP. ROHRBACHER: Right, and plus with this going on in Honduras, that is exactly what we could have expected from this would-be Cadillo (sp), who has also been implicated in the drug trade, in corruption.

That's what we could expect from him. That's why his people, who understood him and his fellow political people, on all sides of the spectrum down there in Honduras, think that it was the right thing to remove him from power because he had violated the constitution.

REP. ENGEL: The gentleman's time has expired.

REP. ROHRBACHER: Thank you very much.

REP. ENGEL: I give Dr. Arnson 30 seconds.

MS. ARNSON: Briefly, I welcome the reference to the coup attempted by President Chavez. He was jailed for that attempt, and then subsequently, you know, was elected. This is not a defense of the Venezuelan government.

But I think all of the people that have so passionately spoken on behalf of the rule of law have not mentioned the fundamental role of due process as a key aspect of the rule of law. And I think that if we can agree that it's not right to arrest someone in the middle of the night in his pajamas and put him on a plane outside --

MR. : If I could --

(Audio break.)

REP. ENGEL: -- I want to give Ms. Lee a chance.

(Cross talk.)

REP. ENGEL: Ms. Lee.

REP. LEE: Yes, let me just associate myself with the remarks of Congressman Payne. And now I'm learning also that -- well, it's clear that the Honduran business community supported the coup, learning that President Zelaya had, you know, raised the minimum wage.

Because it's been said here how the business community had supported the coup and the church had supported the coup. Now I'm learning that the church didn't of course like his veto and the legislation to ban the morning after pill. And so the more and more you dig into this, you can understand why some of what has been said is the case.

I wanted to ask you about the Inter-American Commission Report on Human Rights on July 3rd. They issued actually a statement expressing deep concern over the human rights violations and it said -- the commission said, "Fundamental rights have been restricted, such as personal liberty, allowing incommunicado detention for more than 24 hours, freedom of association, the right of assembly as well as freedom of movement to leave and enter and remain in the territory of Honduras."

So, given the reports about human rights abuses, coming from the puppet or de facto government, what's an appropriate response to that from those who support this whatever it is that has been placed into power?

Mr. Reich, maybe you could answer that for me.

MR. REICH: Well, I'm not sure I understand the question, but I think --

REP. LEE: The Human Rights Commission report that I just read, in terms of the fundamental rights being restricted as a result of the coup. What's your position on how do we address that?

MR. REICH: I will not justify the restrictions of civil rights by any government, period. However, we need to also look at what led to the events of June 28th in Honduras. There had been violations of the Honduran people's civil rights by the Zelaya government. This didn't just happen.

The Honduran supreme court didn't just wake up that Friday morning and decide, why don't we just write an opinion unanimously to get rid of the president? It was a succession of violations of their own law.

REP. LEE: Well, let me just say, we've had presidents who many of us believe have violated our own law in the Constitution and none of us have suggested any coup d'etat. We've always suggested moving --

MR. REICH: Well, I think that --

REP. LEE -- forward with the democratic process to make sure democracy prevails.

MR. REICH: Right, because our system works and the institutions work. And what I think we are failing to see here is that the institutions of Honduras also worked. And, you know, we are -- I think this is a dialogue of a death, frankly, on the question of the coup.

You've heard members of the -- former members of the Honduras supreme court tell you that by their law, the actions of the president constituted a self-activating rule by which he ceased to be the president of Honduras. I'm not a lawyer. As I've said in my testimony, I'm not qualified to judge, but I think that Mr. Perez- Cadalso -- Dr. Perez-Cadalso certainly is.

And he is saying to us, as did another former president of the Supreme Court, who I quote in my testimony, who said that that action was legal, Mrs. Lee -- Congresswoman Lee. I don't think that the Congress of the United States should sit in judgment of the supreme court of another country.

REP. LEE: Well, let me tell you, Cuba has its constitution, and there are those who were saying -- talking out of both sides of their mouth.

MR. REICH: That's right. Well, and there were also the Nuremburg laws in Germany, if you want to defend those kind of laws.

REP. ENGEL: Let me move -- we have a member of the committee who is with us, although not a member of the subcommittee, and she's been very patient. I would like to give her an opportunity to ask a quick question. That's Ms. Sheila Jackson-Lee.

REP. SHEILA JACKSON LEE (D-TX): Mr. Chairman, you're very kind, and I'll be very, very brief.

This is a crucial and important hearing. I probably beg to differ with my dear friend Mr. Reich. I think it is important for constitutional governments to come in on the process of government.

I would offer this: I think it is good news that the president of Costa Rica and Secretary Clinton are in the engagement process, Mr. Davis, and I thank you for that. Here is my offer and suggestion.

One, I would like to ask Ms. Olson very quickly, do you think the pause that we have on aid is positive? Secondarily, I'd like to hear from anyone who wants to answer whether or not there would be an acceptance of the return of this president to finish out his stated constitutional term, because that is the crux -- crunch of what I believe is the fault.

This was a coup. This was a disruption of government. This was using tools that I don't believe are written in the Honduran constitution. Is a coup written in the constitution? If you can point to me, then I will say that this meeting should end.

I will end on that note and ask Ms. Olson about the pause of aid. It is not a complete elimination, and anyone else that wants to answer whether they would accept the negotiations of Secretary Clinton and the president of Costa Rica.

And I thank you very much, Mr. Chairman. I yield back. And let me say the name right: the president of Costa Rica. Thank you.

MS. OLSON: Just to respond to the question, I don't have the number right in front of me, but it's not a huge percentage of the aid that's suspended right now because so much of U.S. aid now doesn't go directly to the government; it goes through nongovernmental organizations.

Do I think it's appropriate to suspect aid after coups? Yes, I do, because there has to be some kinds of mechanisms that countries can use to show their disagreement, in a sense, with something that's happened.

So, yes, I do think it's an appropriate -- that it is appropriate. And, no, we haven't cut off all aid to Honduras.

REP. JACKSON LEE: And so it's not an indictment of what we're trying to do. Thank you. Anyone want to answer about these negotiations?

MR. : Congresswoman Lee, first of all, it's nice to see you. And, secondly, I did want to correct the record by Congresswoman Lee. The business community did not support violating any constitutional or legal procedures regarding shipping Mr. Zelaya out of the country.

I said, when you weren't here, Congresswoman Lee, that with the wisdom of hindsight, it could have been done differently. But understanding the context of the fear at the time, that he needed to be arrested and he needed to be prosecuted, and that is the rule of law. And I'll let the parties themselves decide if and when he returns, how the rule of law is going to be upheld.

And still, as President Obama always tells us and as Secretary Clinton always tells us, let's come together in dialogue and find a solution where there is no bloodshed, where we can restore the rule of law. That is why Secretary Clinton has done such a great job here in letting President Arias try to mediate.

REP. JACKSON LEE: Well, I agree. I'll just yield back and say that I repeat that a coup is not in the constitution. We all adhere to the rule of law. And I do believe there should be a return. I yield back to the chairman.

REP. ENGEL: Well, thank you. Let me -- unless there is anyone who would like to add anything -- any of the panelists would like to add anything -- Mr. Mack and I have agreed to stay. But I think we've covered it pretty thoroughly and we've had all different points of view, both from my colleagues here and also from the panelists.

So unless anyone has anything they really must say, I want to thank each and every one of you for some very, very important testimony for what I consider this very, very important hearing. This subcommittee will continue to monitor the events in Honduras, and we will continue to act accordingly.

So I thank the panelists. I thank my colleagues. And the subcommittee hearing is now -- (sounds gavel) -- closed.