That is the agency that oversees US foreign humanitarian and development aid.
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Mr Biden made the announcement and said he was elevating the position to the National Security Council in the White House.
He called Ms Power “a world-renowned voice of conscience and moral clarity”.
Ms Power served as UN ambassador from 2013 to 2017.
She won a Pulitzer Prize in 2003 for her book A Problem From Hell: America And The Age Of Genocide, about the US foreign policy response to genocide.
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