By Felicia Schwartz 

WASHINGTON -- U.S. chief diplomat Rex Tillerson is floating a plan to slash 2,300 jobs and 26% of the budget from the State Department, affirming the Trump administration's intention to favor military over diplomatic spending, people familiar with the proposal said.

Mr. Tillerson's proposal follows the Office of Management and Budget's plan that included President Donald Trump's call to cut funding for the State Department and the U.S. Agency for International Development by 31%. Officials cautioned that the budget discussions continue and the administration's final funding request to Congress won't be released until the second week of May.

But Mr. Tillerson's proposal still demonstrates his belief that State has become bloated and inefficient. "We have undertaken a budget exercise to accommodate as best we can the president's objective to reduce the cost of what we do over here at the State Department," he said on Fox News this week.

Even Mr. Tillerson's proposal for slightly reduced budget cuts, however, is likely to face resistance on Capitol Hill. Earlier this week, 43 Republican and Democratic senators signed onto a letter to congressional appropriators arguing for "robust funding" for foreign aid and diplomacy.

"At a time when we face multiple national-security challenges around the world, deep cuts in this area would be short-sighted, counter-productive and even dangerous," the letter said.

OMB declined to comment on the budget plans as did the State Department. State employs about 75,000 people in the U.S. and abroad. Many are foreign nationals employed at embassies and consulates.

The budget process is playing out as Mr. Tillerson is looking for a major overhaul of the State Department. He told NPR in an interview aired Friday that he will soon "embark on a department-wide listening mission" to figure out the best way to restructure.

Mr. Tillerson has assigned Bill Inglee, a former Capitol Hill staffer and Lockheed Martin Corp. executive, to oversee the budget process and staffing changes. Mr. Inglee will work with a consulting firm to survey State Department employees about their roles.

Among other steps, the secretary is expected to reduce recruitment of new Foreign Service officers, the diplomats who man U.S. missions around the world issuing visas, providing services to American citizens and conducting relations with local governments.

Adding to the uncertainty at State, the administration has moved slowly to fill the department's upper ranks, which include 119 top positions and ambassadorships confirmable by the Senate. So far, Mr. Tillerson has nominated only one official for a top position inside the Washington headquarters, attorney John Sullivan to be deputy secretary. Mr. Sullivan served in the Commerce and Defense departments during the George W. Bush administration.

Some White House officials have been frustrated with the department's slow pace of hiring.

"That's going to be the natural tension, the White House wants it to be done yesterday," a senior administration official said. "Tillerson wants the department structured the way he wants it -- you have conflicting agendas there."

Mr. Tillerson won't wait to complete the restructuring before filling senior roles, officials said. Mr. Tillerson told NPR "the leadership is coming," adding that the pace has been "a little slower than even I would have hoped."

The Trump administration has nominated or floated names of several ambassadors. Mr. Trump's former bankruptcy attorney, David Friedman, has already secured confirmed to be U.S. ambassador to Israel and is set to arrive there in the coming weeks.

Write to Felicia Schwartz at Felicia.Schwartz@wsj.com

(END) Dow Jones Newswires

April 28, 2017 17:49 ET (21:49 GMT)

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