Sen. Hillary Rodham Clinton (D-N.Y.) says she supports the Pentagon’s new Africa Command, but she also worries that “we have to be careful that it “doesn’t appear that our only real government engagement throughout Africa is our new military presence.”

Clinton, who is President-elect Barack Obama’s choice to be Secretary of State, says State Department funding is a big problem. “We have so under-resourced our diplomacy and our development” programs, she says, adding that more and more overseas tasks are being turned over to the military – like civil reconstruction and operating health clinics.

In her confirmation hearing before the Senate Foreign Relations Committee, Clinton said withdrawing U.S. troops from Iraq and combining both defense and diplomatic efforts to project “smart power,” were among the Obama administration’s foreign policy priorities.

“We must use what has been called ‘smart power,’ the full range of tools at our disposal – diplomatic, economic, military, political, legal and cultural … for each situation,” Clinton said in her opening statement. Defense Secretary Robert Gates and departing Secretary of State Condoleezza Rice have voiced a similar policy push before lawmakers.

Gates has said the State Department should get more funding for civil reconstruction projects, even if it means less money for the Pentagon. Sen. Jim Webb (D-Va.), a member of the committees that oversee both State and Defense, praises the concept, noting that “the implications go beyond the notion of turf wars.” The issue addresses how the U.S. is perceived around the world, he says, and  increasingly, it's “as a military guarantor in other countries’ instead of an economic or cultural partner.

Clinton also said the Obama camp is conducting a policy review of relations with Iran with plans to use diplomacy, sanctions and coalitions to prevent Iran from acquiring nuclear weapons. She said, however, Obama’s team has “no illusions” about dealing with the Islamic republic adding: “We’re not taking any option off the table.”