U.S. administration loses top-ranking Arab American

By David Morgan

WASHINGTON (Reuters) - The highest-ranking Arab American in the Bush administration has resigned from her post at the U.S. State Department to take a job with Wall Street investment firm Goldman Sachs, officials said on Wednesday.

Dina Habib Powell, assistant secretary of state for educational and cultural affairs, is the latest in a series of senior State Department officials to leave the administration in recent months.

The Egyptian-born Powell, 33, who is fluent in Arabic, has also played a leading role in administration public diplomacy efforts to address America's eroded stature in the Muslim world as deputy to Undersecretary of State Karen Hughes.

After Israel's 34-day war with Hezbollah last summer, Powell led a delegation to Lebanon to promote a U.S.-sponsored program to foster long-term economic growth and stability with both public and private-sector funding.

Before President George W. Bush nominated her as assistant secretary of state in April 2005, Powell worked at the White House as Bush's top advisor for personnel issues including political appointments.

She has also served as the Republican National Committee's director of congressional affairs and as a congressional aide to Texas Republican Dick Armey, former majority leader of the U.S. House of Representatives.

A Goldman Sachs memo said Powell will serve as managing director for corporate engagement, overseeing the firm's liaisons with nongovernmental organisations and philanthropic and other non-profit groups.

The Washington Post, which first reported her departure on Wednesday, said Powell resurrected people-to-people exchanges with Iran at a time of rising tensions between Washington and Tehran over the country's nuclear program.