    [Senate Hearing 108-440]
    [From the U.S. Government Publishing Office]

                                                     S. Hrg. 108-440, Pt. 1

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

    =======================================================================

                                    HEARINGS

                                   before the

                          COMMITTEE ON ARMED SERVICES
                              UNITED STATES SENATE

                          ONE HUNDRED EIGHTH CONGRESS

                                 SECOND SESSION

                                       ON

                                    S. 2400

         TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2005 FOR MILITARY
    ACTIVITIES OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND
       FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE
    PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR FOR THE ARMED FORCES, AND FOR
                                 OTHER PURPOSES

                                   __________

                                     PART 1

                                MILITARY POSTURE
                                 SERVICE CHIEFS
                              SERVICE SECRETARIES
                        UNIFIED AND COMBATANT COMMANDERS
                                MISSILE DEFENSE
          ATOMIC ENERGY DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY
       ROLE OF U.S. NORTHERN COMMAND AND U.S. SPECIAL OPERATIONS COMMAND
                        UNIFIED AND REGIONAL COMMANDERS
                        CONTINGENT RESERVE FUND REQUEST

                                   __________

         FEBRUARY 4, 10; MARCH 2, 4, 11, 23, 25; APRIL 1; MAY 13, 2004

             Printed for the use of the Committee on Armed Services

                                   ----------
                             U.S. GOVERNMENT PRINTING OFFICE

    93-571 PDF                       WASHINGTON : 2005

    For sale by the Superintendent of Documents, U.S. Government Printing
    Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800;
    DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC,
    Washington, DC 20402-0001

                          COMMITTEE ON ARMED SERVICES

                        JOHN WARNER, Virginia, Chairman

    JOHN McCAIN, Arizona                 CARL LEVIN, Michigan
    JAMES M. INHOFE, Oklahoma            EDWARD M. KENNEDY, Massachusetts
    PAT ROBERTS, Kansas                  ROBERT C. BYRD, West Virginia
    WAYNE ALLARD, Colorado               JOSEPH I. LIEBERMAN, Connecticut
    JEFF SESSIONS, Alabama               JACK REED, Rhode Island
    SUSAN M. COLLINS, Maine              DANIEL K. AKAKA, Hawaii
    JOHN ENSIGN, Nevada                  BILL NELSON, Florida
    JAMES M. TALENT, Missouri            E. BENJAMIN NELSON, Nebraska
    SAXBY CHAMBLISS, Georgia             MARK DAYTON, Minnesota
    LINDSEY O. GRAHAM, South Carolina    EVAN BAYH, Indiana
    ELIZABETH DOLE, North Carolina       HILLARY RODHAM CLINTON, New York
    JOHN CORNYN, Texas                   MARK PRYOR, Arkansas

                        Judith A. Ansley, Staff Director

                 Richard D. DeBobes, Democratic Staff Director

                                      (ii)

                                C O N T E N T S

                                  ----------

                        CHRONOLOGICAL LIST OF WITNESSES
                                Military Posture
                                february 4, 2004

                                                                       Page

    Rumsfeld, Hon. Donald H., Secretary of Defense; Accompanied by
      Hon. Dov S. Zakheim, Comptroller, Department of Defense; Gen.
      Peter Pace, USMC, Vice Chairman, Joint Chiefs of Staff; Hon.
      Steven Cambone, Under Secretary for Intelligence; and Hon.
      David S.C. Chu, Under Secretary for Personnel and Readiness....    10

                                 Service Chiefs
                               february 10, 2004

    Schoomaker, GEN Peter J., USA, Chief of Staff, United States
      Army; Accompanied by LTG Steven Blum, USA, Chief, National
      Guard Bureau...................................................   143
    Clark, ADM Vernon E., USN, Chief of Naval Operations.............   186
    Hagee, Gen. Michael W., USMC, Commandant of the Marine Corps.....   209
    Jumper, Gen. John P., USAF, Chief of Staff, United States Air
      Force..........................................................   227

                              Service Secretaries
                                 march 2, 2004

    Brownlee, Hon. Les, Acting Secretary of the Army.................   886
    England, Hon. Gordon R., Secretary of the Navy...................   902
    Roche, Hon. James G., Secretary of the Air Force.................   917

        Unified and Regional Commanders on Their Military Strategy and
                            Operational Requirements
                                 march 4, 2004

    Abizaid, GEN John P., USA, Commander, United States Central
      Command........................................................   990
    Jones, Gen. James L., USMC, Commander, United States European
      Command, and Supreme Allied Commander, Europe..................  1007

                           Ballistic Missile Defense
                                 march 11, 2004

    Wynne, Hon. Michael W., Acting Under Secretary of Defense for
      Acquisition, Technology, and Logistics.........................  1082
    Christie, Hon. Thomas P., Director, Operational Test and
      Evaluation.....................................................  1086
    Ellis, ADM James O., Jr., USN, Commander, United States Strategic
      Command........................................................  1090
    Kadish, Lt. Gen. Ronald T., USAF, Director, Missile Defense
      Agency.........................................................  1096
    Dodgen, LTG Larry J., USA, Commander, Space and Missile Defense
      Command........................................................  1110

          Atomic Energy Defense Activities of the Department of Energy
                                 march 23, 2004

    Abraham, Hon. Spencer, Secretary of Energy.......................  1178

     The Role of U.S. Northern Command and U.S. Special Operations Command
          in Defending the Homeland and in the Global War on Terrorism
                                 march 25, 2004

    O'Connell, Hon. Thomas W., Assistant Secretary of Defense for
      Special Operations and Low Intensity Conflict..................  1233
    Brown, GEN Bryan D., USA, Commander, United States Special
      Operations Command.............................................  1239
    McHale, Hon. Paul, Assistant Secretary of Defense for Homeland
      Defense........................................................  1247
    Eberhart, Gen. Ralph E., USAF, Commander, United States Northern
      Command, and Commander, North American Aerospace Defense
      Command........................................................  1256

        Unified and Regional Commanders on Their Military Strategy and
                            Operational Requirements
                                 april 1, 2004

    Fargo, ADM Thomas B., USN, Commander, United States Pacific
      Command........................................................  1313
    LaPorte, GEN Leon J., USA, Commander, United Nations Command and
      Republic of Korea/United States Combined Forces Command, and
      Commander, United States Forces Korea; Accompanied by Maj. Gen.
      Timothy Donovan, USMC, C-5, United States Forces Korea.........  1338
    Hill, GEN James T., USA, Commander, United States Southern
      Command........................................................  1355

                        Contingent Reserve Fund Request
                                  may 13, 2004

    Wolfowitz, Hon. Paul D., Deputy Secretary of Defense.............  1405
    Kaplan, Hon. Joel D., Office of Management and Budget............  1411
    Pace, Gen. Peter, USMC, Vice Chairman of the Joint Chiefs of
      Staff..........................................................  1415

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                          WEDNESDAY, FEBRUARY 4, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

                                MILITARY POSTURE

        The committee met, pursuant to notice, at 9:34 a.m. in room
    HR-2118, Rayburn House Office Building, Senator John Warner
    (chairman) presiding.
        Committee members present: Senators Warner, McCain,
    Roberts, Sessions, Collins, Ensign, Talent, Chambliss, Graham,
    Dole, Cornyn, Levin, Kennedy, Reed, Akaka, Bill Nelson, Ben
    Nelson, Dayton, Bayh, Clinton, and Pryor.
        Committee staff members present: Judith A. Ansley, staff
    director; Marie Fabrizio Dickinson, chief clerk; Cindy Pearson,
    assistant chief clerk and security manager; and Leah C. Brewer,
    nominations and hearings clerk.
        Majority staff members present: Charles W. Alsup,
    professional staff member; L. David Cherington, counsel; Regina
    A. Dubey, research assistant; Brian R. Green, professional
    staff member; William C. Greenwalt, professional staff member;
    Ambrose R. Hock, professional staff member; Gregory T. Kiley,
    professional staff member; Thomas L. MacKenzie, professional
    staff member; Elaine A. McCusker, professional staff member;
    Lucian L. Niemeyer, professional staff member; Paula J.
    Philbin, professional staff member; Lynn F. Rusten,
    professional staff member; Joseph T. Sixeas, professional staff
    member; Scott W. Stucky, general counsel; Diana G. Tabler,
    professional staff member; and Richard F. Walsh, counsel.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; Daniel J. Cox, Jr., professional
    staff member; Madelyn R. Creedon, minority counsel; Kenneth M.
    Crosswait, professional staff member; Gabriella Eisen, research
    assistant; Evelyn N. Farkas, professional staff member; Richard
    W. Fieldhouse, professional staff member; Creighton Greene,
    professional staff member; Jeremy L. Hekhuis, professional
    staff member; Bridget W. Higgins, special assistant; Maren R.
    Leed, professional staff member; Gerald J. Leeling, minority
    counsel; Peter K. Levine, minority counsel; and William G.P.
    Monahan, minority counsel.
        Staff assistants present: Michael N. Berger, Andrew W.
    Florell, and Sara R. Mareno.
        Committee members' assistants present: Christopher J. Paul,
    assistant to Senator McCain; Arch Galloway II, assistant to
    Senator Sessions; James P. Dohoney, Jr. and Derek J. Maurer,
    assistants to Senator Collins; Lindsey R. Neas, assistant to
    Senator Talent; Clyde A. Taylor IV, assistant to Senator
    Chambliss; Aleix Jarvis and Meredith Moseley, assistants to
    Senator Graham; Christine O. Hill, assistant to Senator Dole;
    Russell J. Thomasson, assistant to Senator Cornyn; Sharon L.
    Waxman, Mieke Y. Eoyang, and Jarret A. Wright, assistants to
    Senator Kennedy; Elizabeth King, assistant to Senator Reed;
    Davelyn Noelani Kalipi, assistant to Senator Akaka; William K.
    Sutey, assistant to Senator Bill Nelson; Eric Pierce, assistant
    to Senator Ben Nelson; Todd Rosenblum, assistant to Senator
    Bayh; Andrew Shapiro, assistant to Senator Clinton; and Terri
    Glaze, assistant to Senator Pryor.

           OPENING STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner. Good morning, everyone. I am not sure what
    the precedents are for the Senate Armed Services Committee
    commandeering the other body's chamber, but nevertheless,
    sitting up here, I feel somewhat like a bishop. A very
    impressive setting. I thank my distinguished friend, the
    chairman of the House Armed Services Committee, Duncan Hunter;
    and the ranking Democrat, another dear friend, Ike Skelton; and
    Robert Rangel, the staff director.
        The committee meets today to receive annual testimony from
    the Secretary of Defense and the Joint Chiefs of Staff--this
    morning represented by the Vice Chairman, General Pace, in the
    absence of General Myers, who had the untimely loss of his
    brother, Chuck Myers.
        Senator McCain. Mr. Chairman, I do not think we have order
    here.
        Chairman Warner. I think you have a point, and I cannot
    judge from the noise up here. We will ask the audience to
    refrain from conversation, please. Thank you.
        We are to receive the posture of the United States Armed
    Forces and President Bush's defense budget request for fiscal
    year 2005 and the Future Years Defense Program (FYDP).
    Secretary Rumsfeld and Vice Chairman Pace, we welcome you again
    back before the committee and commend you once again for the
    outstanding leadership that you both continue, as a team, to
    provide our Nation and to our men and women in uniform and
    their families.
        There are few precedents for the challenges you face in
    this post-September 11 world, but in every way you have met the
    challenges.
        I start today by recognizing the men and women of the Armed
    Forces of the United States who, together with a coalition of
    nations, liberated Iraq, a country larger than Germany and
    Italy combined, in roughly 3 weeks. This combined force
    accomplished this with unprecedented precision and casualties
    were far below the estimates. Nevertheless, we grieve each and
    every one who was lost or wounded and express our compassion to
    their families.
        Iraq, a nation that for decades had known only tyranny and
    oppression, is now moving forward to a future of freedom and
    opportunity for all of its people.
        While the mission of the U.S. and the coalition forces
    continues in Iraq, much has been accomplished since Operation
    Iraqi Freedom began last March. The world is a safer place and
    Iraq is a better place because, along with many nations, the
    U.S. confronted a brutal dictator who has defied the mandates
    of the international community for over a decade.
        Disagreements will continue about the process and the
    timing of the decision to use force, but on one thing there can
    be no disagreement: the professionalism, the performance, and
    the sacrifices of the men and women in uniform were, are, and
    always will be inspiring. Every American is justifiably proud
    of the U.S. Armed Forces. The security of the United States of
    America is in good hands today with its military.
        As we meet this morning, hundreds of thousands of our
    service members are engaged around the world and here at home,
    defending our Nation in Operation Enduring Freedom, Operation
    Iraqi Freedom, and other military operations in the ongoing
    global war on terrorism. These brave men and women and their
    families deserve our continued support, and they will get it
    from this committee--the equipment, the resources, the support
    they need to perform their missions today and tomorrow and into
    the future.
        We must remember that defense of our homeland begins on the
    distant battlefields of the world. Our forward-deployed forces
    are and will remain our first line of defense. This committee's
    responsibility will continue to be to ensure that these troops
    remain the best equipped, the best trained, and the most
    capable forces in the world.
        I am encouraged by my initial review of the President's
    defense budget for the fiscal year 2005. This request of $401.7
    billion for the Department represents a 5-percent increase over
    the fiscal year 2004 authorized level and the fourth straight
    year of growth for the defense budget. This sends a strong
    signal to the world of America's commitment to freedom, and the
    President and you, Mr. Secretary, deserve special recognition
    because we know the competitive forces in our budget today. But
    to get this increase was necessary.
        As Congress works its will on the budget request, we must
    be mindful of potential problems. We are putting increased
    demands on our forces around the world, increased demands on
    their families, and increased demands on our Reserve and
    National Guard. We are blessed with a military that is
    responding to these demands with extraordinary commitment, but
    even the best military has its limits.
        As we proceed with the hearing today--and I am going to ask
    unanimous consent that the full balance of my statement be
    included in the record--we are learning of the President's
    initiative to strengthen America's Intelligence Community. I
    commend the President for this leadership, and we await greater
    details about the commission envisioned and its membership. In
    testimony before this committee last week, Dr. David Kay,
    former Special Adviser to Director Tenet, told us that, based
    on the findings to date of the Iraq Survey Group (ISG)--that is
    the military force in country conducting the survey--prewar
    estimates about large stockpiles of weapons of mass destruction
    (WMD) may have been incorrect. As Dr. Kay stated, ``We were
    almost all wrong, and I certainly include myself there.''
        While that is one serious finding to date, he also told us
    of positive findings: that the ISG had discovered a quantum of
    evidence that includes evidence of Saddam Hussein's intent to
    pursue a WMD program on a large scale; evidence of actual and
    ongoing chemical and biological research programs; evidence of
    an active program to use the deadly chemical ricin as a weapon,
    a program that was only interrupted by the start of the war in
    March; evidence of ballistic missile programs that clearly
    violated terms of the United Nations (U.N.) Security Council
    resolution; and there was much more.
        The work of the ISG under General Dayton and Mr. Duelfer
    continues. Final judgments should in fairness await the outcome
    of their work.
        Dr. Kay also told us that he had found absolutely no
    evidence of any intelligence analyst being pressured to change
    or exaggerate any intelligence conclusions. On the contrary, he
    reminded us all that the basic assessment of Iraq's WMD
    holdings had been consistent since 1998, when U.N. inspectors
    left Iraq. Dr. Kay as well as many others have reminded us that
    intelligence efforts often differ from what is later actually
    found on the ground. The important thing is when they differ to
    understand why.
        Based on the intelligence available to the President, not
    only U.S. intelligence but that of the U.N. and other nations,
    Dr. Kay felt that the President could have reached no other
    conclusion: Iraq had caches of chemical and biological weapons,
    had used them in the past, and was likely to use them in the
    future.
        As Dr. Kay stated, ``It was reasonable to conclude that
    Iraq posed an imminent threat. What we learned during the
    inspection made Iraq a more dangerous place potentially than in
    fact we thought it was even before the war.''
        As I stated earlier, the world is a safer place and Iraq is
    a better place because a real and growing threat has been
    eliminated. We did the right thing at the right time to rid
    Iraq of this brutal regime.
        There are currently six ongoing investigations--the
    President's contemplated commission would be the seventh--
    concerning Iraqi WMD programs, including, most importantly, the
    ISG. As I mentioned, it is an ongoing operation, fully funded
    by Congress. It is under the direction of General Dayton and
    Charles Duelfer. It is important that the work of these
    investigations be completed, and I hope that we will receive
    from the Secretary some estimates of the timetable in which
    that is likely to be done.
        An independent panel can build on the good work already
    begun and ultimately contribute to the recommendations on how
    to make our Intelligence Community stronger and more effective.
        The security of our troops in harm's way and of our Nation
    will be improved by these reviews. I wish to commend the
    distinguished chairman of the Intelligence Committee. I am
    privileged to serve on that committee with him, and I believe
    that that committee has done notable work, and perhaps you will
    comment on that in the course of the hearing.
        Mr. Secretary, I hope you can address your views on these
    issues related to the Iraqi WMD and the current situation in
    Iraq in your opening testimony. For example, the President's
    National Security Adviser, Condoleezza Rice, stated, ``There
    are differences between what we knew going in and what we found
    on the ground.'' The question to you is, what steps are you
    taking to ensure that the ongoing intelligence activities of
    defense intelligence agencies, particularly the Defense
    Intelligence Agency (DIA) and the National Security Agency
    (NSA), are as complete and analytically rigorous as possible?
        We must bear in mind that a lot of focus is on the Central
    Intelligence Agency (CIA) and George Tenet, but our
    distinguished witness today has under his jurisdiction a very
    considerable component of the Intelligence Community.
        Mr. Secretary, are you beginning to examine your prewar
    planning and preparation in light of the findings we know to
    date? There have been public accusations of manipulation or
    exaggeration of prewar intelligence by policymakers. You are
    among the first of the administration witnesses to testify
    before Congress on this subject. I say to you most
    respectfully, how do you respond?
        I have been privileged to have known you and worked with
    you for I suspect over 30 years and, speaking for myself, I
    have absolutely 100 percent confidence in your integrity. But
    you should look us square in the eye and give us your own views
    on this subject.
        Mr. Secretary, the plan as laid down by Ambassador Bremer
    and approved by the Iraqi Governing Council calls for a series
    of steps over the next few months culminating in the transfer
    of sovereignty to Iraqi authority on June 30 of this year. Are
    these milestones and final target dates achievable? What
    significant challenges remain? What accommodations are being
    made to ensure our troops can continue to operate and the ISG
    can continue its important work in a sovereign nation,
    presumably, after this transfer on the 30th?
        Again, gentlemen, we welcome you. General Pace, we will
    have the opportunity to hear your testimony and your views, and
    I would certainly invite you to make any comments that you wish
    to make about the WMD program.
        Senator Levin.
        [The prepared statement of Senator Warner follows:]
                   Prepared Statement by Senator John Warner
        The committee meets today to receive annual testimony from the
    Secretary of Defense and the Joint Chiefs of Staff on the posture of
    the U.S. Armed Forces and President Bush's defense budget request for
    fiscal year 2005 and the Future Years Defense Program.
        Secretary Rumsfeld and Vice Chairman Pace, we welcome you back
    before the committee and commend you, once again, for the outstanding
    leadership you both continue, as a team, to provide our Nation and to
    our men and women in uniform and their families. There are few
    precedents for the challenges you face in this post-September 11 world,
    but you have been equal to the task.
        I start today by recognizing the men and women of our Armed Forces
    who, together with a coalition of nations, liberated Iraq, a country
    larger than Germany and Italy combined, in roughly 3 weeks. This
    combined force accomplished this with unprecedented precision and
    casualties far below estimates. Iraq, a nation that for decades had
    known only tyranny and oppression, is now moving forward to a future of
    freedom and opportunity for all of its people.
        While the mission of U.S. and coalition forces continues in Iraq,
    much has been accomplished since Operation Iraqi Freedom began last
    March. The world is a safer place, and Iraq is a better place, because,
    along with many nations, the U.S. confronted a brutal dictator who had
    defied the mandates of the international community for over a decade.
    Disagreements will continue about the process and timing of the
    decision to use force, but on one thing there is no disagreement: the
    professionalism, performance, and sacrifice of our troops was, is, and
    always will be, inspiring. Every American is justifiably proud of the
    U.S. Armed Forces. The security of America is in good hands with
    today's military.
        As we meet this morning, hundreds of thousands of our service
    members are engaged around the world and here at home, defending our
    Nation in Operation Enduring Freedom, Operation Iraqi Freedom, and
    other military operations in the ongoing global war on terrorism. These
    brave men and women, and their families, deserve our continued support.
    They will get it from this committee--the equipment, the resources, the
    support they need to perform their missions.
        As President Bush remarked when he signed last year's Defense
    Authorization Act in November:

            ``Every member of the United States military is now involved in
            a great and historic task. The stakes for our country could not
            be higher. We face enemies that measure their progress by the
            chaos they inflict, the fear they spread, and the innocent
            lives they destroy. America's military is standing between our
            country and grave danger. You're standing for order and hope
            and democracy in Afghanistan and Iraq. You're standing up for
            the security of all free nations, and for the advance of
            freedom.''

        Our President continues to provide the strongest of leadership.
        We must remember that defense of our homeland begins on the distant
    battlefields of the world. Our forward deployed forces are--and will
    remain--our first line of defense. This committee's responsibility will
    continue to be to ensure that these troops remain the best equipped,
    best trained, most capable forces in the world.
        It is critical that we fully honor the service of our men and women
    in uniform, and that we keep faith with their dedication to duty
    through adequate pay raises, timely modernization of equipment and
    facilities, and sustained investment in those programs that enhance the
    quality of life of our service personnel and their families.
        I am encouraged by my initial review of the President's defense
    budget request for fiscal year 2005. This request of $401.7 billion for
    the Department represents a 5-percent increase over the fiscal year
    2004 authorized level, and the fourth straight year of growth for the
    defense budget. This sends a strong signal to the world of America's
    commitment to freedom.
        As Congress works its will on this budget request, we must be
    mindful of potential problems. We are putting increased demands on our
    forces around the world, increased demands on their families, and
    increased demands on our Reserve and National Guard. We are blessed
    with a military that has responded to these demands with extraordinary
    commitment, but even the best military has its limits.
        As we perform our annual budget review, we must--and we will--
    carefully analyze the effects of these challenges on our men and women
    in uniform, and their families. Congress will, I am confident, make the
    investments needed to ensure we have the people and the capabilities
    necessary to meet these challenges.
        There will be many questions. To assist Congress, I hope you can
    address some of these questions in your testimony this morning,
    including:

             Do we have enough people, the right mix of people, and
            the capabilities in the Armed Forces to meet the threats of the
            foreseeable future?
             Are we doing all we can to ensure that our forces
            deployed overseas--both active and Reserve components (RC)--
            have the best possible equipment and support?
             Are the lessons learned from recent military
            operations being rapidly shared and integrated across the
            entire force and with our allies?
             What increased role can we realistically expect NATO
            and other nations to play in the global war on terrorism?
             As we reposition forces to meet new global threats, do
            we have the facilities, infrastructure, and mobility assets we
            will need?

        These are but a few of the complex issues we must work on together
    to solve in the months and years ahead.
        As we proceed with this hearing today, we are learning of the
    President's initiative to strengthen America's intelligence community.
    I commend the President for his leadership.
        In testimony before this committee, last week, Dr. David Kay,
    former Special Advisor to Director Tenet, told us that, based on the
    findings of the Iraq Survey Group, to date, prewar estimates about
    large WMD stockpiles may have been wrong. As Dr. Kay stated, ``. . . we
    were almost all wrong, and I certainly include myself here.'' While
    that is one serious finding, to date, he also told us that the ISG had
    discovered a quantum of evidence, that includes:

             evidence of Saddam Hussein's intent to pursue WMD
            program on a large scale;
             actual, ongoing chemical and biological research
            programs;
             an active program to use the deadly chemical ``ricin''
            as a weapon a program that was only interrupted by the start of
            the war in March; and,
             evidence of ballistic missile programs that clearly
            violated the terms of U.N. Security Council Resolutions.

        Dr. Kay also told us that he had found absolutely no evidence of
    any intelligence analyst being pressured to change or exaggerate any
    intelligence conclusions. On the contrary, he reminded us all that the
    basic assessment of Iraq's WMD holdings had been consistent since 1998,
    when U.N. inspectors left Iraq. Dr. Kay, as well as many others, have
    reminded us that intelligence efforts often differ from what is
    actually found on the ground later. The important thing is when they
    differ, to understand why.
        Based on the intelligence available to the President not only U.S.
    intelligence but that of the U.N. and other nations, Dr. Kay felt that
    the President could have reached no other conclusion: Iraq had caches
    of chemical and biological weapons, had used them in the past, and was
    likely to use them in the future. As he stated, ``. . . it was
    reasonable to conclude that Iraq posed an imminent threat. What we
    learned during the inspection made Iraq a more dangerous place,
    potentially, than, in fact, we thought it was even before the war.''
        As I stated earlier, the world is a safer place and Iraq is a
    better place because a real and growing threat has been eliminated. We
    did the right thing to rid Iraq of this brutal regime.
        There are currently six ongoing investigations concerning Iraqi WMD
    programs, including the work of the Iraq Survey Group funded by
    Congress and under the direction of General Dayton and Charles Duelfer.
    It is important that the work of these investigations be completed. An
    independent panel can build on the good work already begun and,
    ultimately, contribute to the recommendations on how to make our
    intelligence community stronger and more effective. The security of our
    troops in harm's way and of our Nation will be improved by these
    reviews.
        I hope you can address your views on these issues related to Iraqi
    WMD and the current situation in Iraq in your opening testimony. For
    example:

             The President's National Security Advisor, Condoleeza
            Rice, has stated, ``. . . there are differences between what we
            knew going in and what we found on the ground.'' What steps are
            you taking to ensure that the ongoing intelligence activities
            of Defense intelligence agencies particularly DIA and NSA are
            as complete and analytically rigorous as possible?
             Are you beginning to examine your pre-war planning and
            preparation in light of the findings we know, to date?
             There have been public accusations of manipulation or
            exaggeration of pre-war intelligence by policy makers. You are
            among the first in the administration to testify before
            Congress on this subject. How do you respond to these
            accusations?
             The plan, as laid down by Ambassador Bremer and
            approved by the Iraqi Governing Council calls for a series of
            steps over the next few months, culminating in a transfer of
            sovereignty to Iraqi authority on June 30 of this year. Are
            these milestones and final target date achievable? What
            significant challenges remain?
             What accommodations are being made to ensure our
            troops can continue to operate, and the ISG can continue its
            important work, in a sovereign nation after this transfer of
            sovereignty?

        Again, gentlemen, I thank you for your service. Your continued
    commitment to our uniformed and civilian personnel and their families,
    your leadership during time of war, and your focus on preparing our
    Armed Forces to meet the threats of the future have greatly enhanced
    our national security.
        Senator Levin.

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman.
        Let me first join you in welcoming Secretary Rumsfeld,
    General Pace, and Dr. Zakheim back to the Armed Services
    Committee for their annual posture hearing. Much has happened
    in the world since our last posture hearing. The rapid advance
    of our Armed Forces in Operation Iraqi Freedom (OIF) and the
    total collapse of the Iraqi regime stand as a testament to the
    courage and to the dedication of our men and women in uniform,
    who remain by far the best trained, best equipped, and most
    capable military force in the world today. They are the
    standard against which all other military forces are measured.
        Unfortunately, military operations in Iraq did not come to
    an end with the President's announcement on May 1. In early
    July, General Tommy Franks announced that continued violence
    and uncertainty in Iraq would make significant reductions in
    U.S. force levels unlikely for the foreseeable future. Six
    months later, we still have roughly 125,000 troops in Iraq,
    with almost 180,000 more serving in support roles outside of
    the country. We are in the process of rotating in fresh units
    to ensure that we will be able to sustain this presence for
    years to come.
        The current rotation of U.S. forces into Iraq will result
    in a drawdown to 110,000 troops. The drawdown is based upon the
    belief that Iraqi police in the Iraqi Civil Defense Corps
    (ICDC) will be able to take the lead in providing security in
    Baghdad and other Iraqi cities. I am concerned that this will
    set the Iraqi security forces up for failures, as there is a
    real question as to whether they are ready to take on and
    defeat the insurgents who are targeting Iraqis as well as U.S.
    and other coalition forces.
        The new Iraqi army, whose mission is limited to external
    defense, will not have a role in providing domestic security
    for their fellow citizens. I remain convinced, as I have
    written to Secretary Rumsfeld, the President, and others in the
    administration, that the recall of units of the Iraqi army at
    the middle grade and below would have been a better way to help
    handle the insurgent threat.
        Our troops in Iraq face extremely hazardous conditions,
    including improved explosive devices, ambushes, car bombs,
    mortar attacks, and shoulder-fired antiaircraft missiles.
        In addition, roughly 10,000 American troops continue to
    engage in military operations against hostile forces in
    Afghanistan. Tens of thousands more soldiers, sailors, airmen,
    and marines are deployed in Korea and other hot spots around
    the world, including numerous countries that had not seen an
    American in uniform before September 11, 2001.
        Congress and the American people will provide the support
    that is needed by our troops in the field. In less than a year,
    we have enacted two emergency supplemental appropriation acts,
    for $62 billion and $87 billion, to cover the costs of our
    operations in Iraq and Afghanistan. It has been reported that
    an additional supplemental appropriation of $50 billion to $55
    billion will likely be required to fund continued operations
    over the next fiscal year.
        I have no doubt that if our troops need the money Congress
    will provide it. However, that money should have been part of
    the budget before us, not left to a supplemental and therefore
    not part of the projected budget deficit. A fair deficit
    projection would have included those costs since we are
    planning on those costs.
        The pace of operations has placed a great strain on our
    forces. We have seen the imposition of stop-loss requirements
    to prevent troops from leaving the force when their term of
    service is finished. Some have been deployed for extended
    periods, and some have been deployed repeatedly. Some units
    have been told that they would be going home soon, only to have
    their tours of duty extended. Others have been denied clear
    information about when their deployments would end. In the last
    2\1/2\ years, we have seen the largest sustained call-ups of
    National Guard and Reserve components since the establishment
    of an all-volunteer military force.
        A year ago, as our Nation was being prepared to go to war
    in Iraq, a number of us expressed the view that our cause would
    be strongest and our long-term success would be more certain if
    we actively solicited the support of the international
    community. While America's Armed Forces have proven and
    continue to prove every day that they are ready to take on any
    military challenge anywhere in the world, I continue to believe
    that we are paying a steep price for the failure to obtain the
    political support of the international community, which would
    make the occupation one of the world community, to include
    Muslim nations, and not just an occupation by Western nations.
    It would therefore be less difficult and less dangerous.
        The strains on our Armed Forces are very real. Concerns
    about morale and potentially about recruitment and retention
    are real. The risks posed to our Guard and Reserve system are
    real. These are issues that we must do everything in our power
    to help address.
        Finally, in the wake of the testimony of Chief Weapons
    Inspector Dr. David Kay, who concluded that the prewar
    intelligence on Iraqi WMD was fundamentally wrong, this
    committee has a particular responsibility to look into how
    intelligence failures affected planning for and the conduct of
    Operation Iraqi Freedom. I am deeply concerned that my request
    to the Department of Defense (DOD) for information concerning
    the impact that intelligence had on the planning for and the
    conduct of Operation Iraqi Freedom has so far been denied by
    the Department.
        My specific request was for a briefing on the planning
    process generally, including how the intelligence affected that
    planning, and an overview of the final approved war plan for
    Operation Iraqi Freedom to the extent that it can be shared
    with Congress.
        I am also concerned that it has taken so long for the
    Department to respond to my request of November the 25th of
    last year for information relating to the Office of Special
    Plans, which was established by Under Secretary Feith and which
    reportedly involved the review, analysis, and promulgation of
    intelligence outside of the U.S. Intelligence Community.
        My specific request in the case of the Office of Special
    Plans was for documents relating to the establishment,
    functions, and responsibilities of that office and the Policy
    Counterterrorism Evaluation Group, and for documents produced
    by either of those two entities, a list of personnel directly
    related to those two offices, and communications from those two
    offices to key agencies.
        Finally, this morning apparently some of the information
    was delivered to us. But after, just at a quick perusal of that
    information, we also see that much of what we asked for is
    still being denied by the Department, and that is simply
    indefensible. We have an obligation and a responsibility to
    oversee the operations of this Department. I have been
    repeatedly promised that information by Mr. Feith and there
    just was no justification for the long delay in forwarding what
    information came to us this morning. I do hope, Mr. Secretary,
    that you will straighten this out for us.
        I look forward to the testimony of our witnesses and I
    welcome them all back to this committee.
        Chairman Warner. Thank you, Senator Levin.
        Mr. Secretary.

      STATEMENT OF HON. DONALD H. RUMSFELD, SECRETARY OF DEFENSE;
    ACCOMPANIED BY HON. DOV S. ZAKHEIM, COMPTROLLER, DEPARTMENT OF
    DEFENSE; GEN. PETER PACE, USMC, VICE CHAIRMAN, JOINT CHIEFS OF
     STAFF; HON. STEVEN CAMBONE, UNDER SECRETARY FOR INTELLIGENCE;
      AND HON. DAVID S.C. CHU, UNDER SECRETARY FOR PERSONNEL AND
                               READINESS

        Secretary Rumsfeld. Thank you very much, Mr. Chairman,
    members of the committee. I appreciate this opportunity to
    testify on our DOD budget and request that my full statement be
    included in the record.
        I, too, regret that General Myers could not be with us
    today because of the loss of his brother. I have, in addition
    to General Pace and Dr. Zakheim, brought two individuals, two
    under secretaries, along in the event that there are questions
    on the intelligence side or on the force level side. Dr. David
    Chu is here and is available, and Dr. Steve Cambone. Dr. Chu of
    course is the Under Secretary for Personnel and Readiness, and
    Dr. Cambone is the Under Secretary for Intelligence.
        I, too, want to commend the courageous men and women in
    uniform and also the civilians in the DOD that serve all over
    the globe as well. What they have accomplished since our
    country was attacked 28 months ago is truly impressive. They
    have helped to overthrow 2 terrorist regimes, to capture or
    kill 45 of the 55 most wanted in Iraq, including Saddam Hussein
    and his sons, to capture or kill close to two-thirds of known
    senior al Qaeda operatives, and to disrupt terrorist cells on
    several continents. We value their service, their sacrifice,
    and the sacrifice of their families as well.
        When this administration took office 3 years ago, the
    President charged us to change the status quo and prepare the
    Department to meet the new threats of the 21st century. To meet
    that charge, we have fashioned a new defense strategy, a new
    force sizing construct, a new approach to balancing risks. We
    have issued a new unified command plan, taken steps to attract
    and retain the needed talent in our Armed Forces, including
    targeted pay raises and quality of life improvements for the
    troops and their families.
        We have instituted what we believe to be more realistic
    budgeting so that the Department now looks to budget
    supplementals for unknown warfighting costs and not to simply
    sustain readiness. We have completed a nuclear posture review.
    We have transformed the way the Department prepares its war
    plans. We have adopted a new lessons-learned approach during
    Operation Iraqi Freedom and undertaken a comprehensive review
    of our global force posture. With your help, we are
    establishing the new National Security Personnel System (NSPS)
    that should better enable us to manage our 746,000 civilian
    employees.
        The scope and scale of what has been done, what has been
    accomplished, and what has been initiated is substantial. Our
    challenge is to build on these efforts even as we fight the
    global war on terror.
        One effect of the global war on terror has been a
    significant increase in operational tempo and an increased
    demand on the force. To manage the demand on the force, we have
    to first be very clear about what the problem really is, so
    that we can work together to fashion appropriate solutions.
        The increased demand on the force we are experiencing today
    is, we believe, very likely a spike, driven by the deployment
    of 115,000 troops in Iraq. For the moment, the increased demand
    is real, and we have taken a number of immediate actions. We
    are increasing international military participation in Iraq. We
    have accelerated the training of Iraqi security forces, now
    more than 200,000 strong. Our forces are hunting down those who
    threaten Iraq's stability and transition to self-reliance.
        Another way to deal with the increased demand on the force
    is to add more people. Well, we have already done so--we might
    want to put up a chart there----

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        --a fact that many people seem not to understand. Using the
    powers granted by Congress, we have already increased Active-
    Duty Force levels by nearly 33,000 above pre-emergency
    authorized end strength. We have done this over the past 2
    years, as you can see. If the war on terror demands it, we will
    not hesitate to increase force levels even more using those
    emergency authorities provided by Congress.
        But it should give us pause that even a temporary increase
    in our force levels was and remains necessary. Think about it.
    At this moment we have a pool of about 2.6 million men and
    women, active and Reserve. Yet the deployment of 115,000 troops
    in Iraq has required that we temporarily increase the size of
    the force by 33,000. That suggests strongly that the real
    problem is not the size of the force per se, but rather the way
    the force has been managed and the mix of capabilities at our
    disposal. It suggests that our challenge is considerably more
    complex than simply adding more troops.
        General Pete Schoomaker, the Army Chief of Staff, compares
    the problem to a rain barrel in which the spigot is near the
    top. When you turn the spigot on, it only draws off the water
    at the very top. The task--you have two choices: You can either
    increase the size of the barrel and leave the spigot where it
    is or you can lower the spigot and start drawing on the
    contents of the entire barrel.
        The answer in my view is most certainly not a bigger rain
    barrel. The answer is to move the spigot down so that all the
    water is accessible and can be used and so that we can take
    full advantage of the skills and talents of everyone who serves
    in the Guard and Reserve.
        Another chart, please, Commander.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        I do not know if you can see that up there. But I keep
    hearing people talk about the stress on the Guard and the
    Reserve. The fact is that since September 11, 2001, we have
    mobilized only 36 percent of the Selected Reserve, a little
    over one-third of the available forces in the Selected Reserve.
    But while certain skills are in demand, as the chart shows,
    only a very small fraction of the Guard and Reserve, just 7.15
    percent, have been involuntarily mobilized more than once since
    1990, 13 years ago. Over 13 years we have mobilized only 7.15
    percent of the Guard and Reserve involuntarily more than once.
        That means that the same people are getting stressed and
    they are getting used and used, but the vast majority of the
    Guard and Reserve are not being used. Over 60 percent have not
    been mobilized to fight the global war on terror. Indeed, I am
    told that a full 58 percent of the current selected Reserve, or
    about 500,000 troops, have not been involuntarily mobilized in
    the past 10 years.
        Now, what does that tell us? First, it argues that we have
    too few Guard and Reserve Forces with the skill sets that are
    in high demand. We obviously, therefore, have too many Guard
    and Reserve Forces with skill sets that are in little or no
    demand.
        Second, it indicates that we need to rebalance the skill
    sets within the Reserve components and also between the active
    and the Reserve components so that we have enough of the right
    kinds of forces available to accomplish the needed missions.
        Third, it suggests that we need to focus on transforming
    the forces for the future, making sure we continue to increase
    the capability of the force, thus our ability to do more with
    the forces that we have. We are working to do just that.
        In looking at our global force posture review, some
    observers had focused on the number of troops, tanks, and ships
    that we might add or remove from a given part of the world,
    Europe, Asia, or somewhere else. I would submit that that may
    well not be the best measure. If you have 10 of something, say
    ships, and you reduce the number by 5, you end up with half as
    many. But if you replace the remaining half with ships that
    have double the capability, then you have really not reduced
    your capability even though the numbers have been reduced.
        That is true of troops. That is true of aircraft. It is
    true of going from dumb bombs to precision bombs. Today the
    Navy is reducing force levels. Yet, because of the way they are
    arranging themselves, they will have more combat power
    available than they did when they had more people. In Operation
    Iraqi Freedom, the Navy surged more than half of the fleet to
    the Persian Gulf region for the fight. With the end of the
    major combat operations, instead of keeping two or three
    carrier strike groups forward, they quickly redeployed all
    their carrier strike groups to home base. By doing so they
    reset the force in a way that will allow them to surge over 50
    percent more combat power on short notice to deal with future
    contingencies.
        The result? Today six aircraft carrier strike groups are
    available to respond immediately to any crisis that might
    confront us--all while the Navy is moderately reducing the size
    of its Active Force.
        The Army, by contrast, has put forward a plan that, by
    using emergency powers, will increase force levels by about 6
    percent. Because of the way he will do it, the Army estimates
    that they will be adding, not 6 percent, but up to 30 percent
    more combat power. Instead of adding more divisions, Pete
    Schoomaker and the acting Secretary of the Army are focusing
    instead on creating a 21st century modular army made up of
    self-contained, more self-sustaining brigades that are
    available to work for any division commander.
        As a result, the intention is that 75 percent of the Army's
    brigade structure would always be ready in the event of a
    crisis. The Army plans will increase the number of active and
    Reserve brigades significantly over the next 4 years, but
    because we will be using emergency powers we will have the
    flexibility to reduce the number of active troops if, as, and
    when the security situation permits.
        The point is this: The focus needs to be on more than just
    numbers. We should be focusing on finding ways to better manage
    the forces we have and on increasing the speed, agility,
    modularity, capability, and usability of those forces. Today
    DOD has several dozen initiatives under way to improve
    management of the force and to increase its capability. We are
    investing in new information age technologies and less
    manpower-intensive platforms and technologies.
        We are working to increase the jointness of our forces,
    taking civilian tasks currently done by uniformed personnel and
    converting them into civilian jobs, freeing military personnel
    for military tasks. We have begun consultations with allies and
    friends about ways to transform our global force posture to
    further increase our capability. We are working to rebalance
    the active and Reserve components, taking skills that are found
    almost exclusively in the Reserves and moving forces out of
    low-demand specialties, such as heavy artillery, and into
    higher demand capabilities, such as Military Police, civil
    affairs, and Special Operations Forces.
        A number of the members of the committee have served in the
    Guard and Reserve. Each of us knew when we signed up that it
    was not simply to serve 1 weekend and 2 weeks active duty. We
    signed up so that if war was visited on our country we would be
    ready to become part of the Active Force, and on September 11
    war was visited on our country.
        If we were not to call up the Guard and Reserves today,
    then why would we have them at all? This is the purpose of the
    Guard and Reserve. It is what they signed up for, and, God
    bless them, the vast majority are eager to serve, a fact borne
    out by the large number of those who stepped forward and
    volunteered to be mobilized for service in Afghanistan and in
    Iraq.
        Our responsibility is to do everything we can to see that
    they are treated respectfully, managed effectively, and that we
    have the tools they need to win today's wars and to deter
    future conflicts.
        Today, because DOD has the flexibility to adjust troop
    levels as the security situation may require, we believe that a
    statutory end strength increase will take away our flexibility
    to manage the force. First, if the current increased demand
    turns out to be a spike, the Department would face a
    substantial cost of supporting a larger force when it may no
    longer be needed.
        Second, if we permanently increase statutory end strength,
    we will have to take the cost out of the DOD top line. That
    will require cuts in other parts of the defense budget--
    crowding out investments and the programs that will allow us to
    manage the force better and to make it more capable.
        I urge Congress not to lock us into a force size and
    structure that may or may not be appropriate in the period
    ahead. During the period of the emergency, we have all the
    flexibility that is required and we have been using it.
        The 2005 budget before you is in a real sense a request for
    a second installment on funding for the transformational
    priorities set out in the President's 2004 request. In 2005, we
    have requested $29 billion for investments in transforming
    military capabilities. We have requested additional funds to
    strengthen intelligence, including critical funds to increase
    DOD human intelligence capabilities, persistent surveillance,
    as well as technical analysis and information-sharing.
        We have requested $11.1 billion to support procurement of
    nine ships in 2005. In all, the President has requested $75
    billion for procurement in 2005 and $69 billion for research,
    development, testing, and evaluation.
        We also need your continuing support for two initiatives
    that are critical to the 21st century transformation, the
    Global Posture Review and the Base Realignment and Closure
    (BRAC) Commission scheduled for 2005. These are important
    initiatives. We need BRAC to rationalize our infrastructure and
    the new defense strategy and to eliminate unneeded bases and
    facilities that are costing the taxpayers billions of dollars
    to support. We need the global posture changes to help us
    reposition our forces around the world so that they are
    stationed--not where the wars of the 20th century happened to
    end, but rather arranged in a way that will allow them to deter
    and, as necessary, defeat potential adversaries who might
    threaten our security or that of our friends and allies in the
    21st century. These two are inextricably linked.
        Mr. Chairman, the President has asked Congress for $401.7
    billion for fiscal year 2005. It is an enormous amount of
    taxpayers' hard-earned money. Such investments will likely be
    required for a number of years to come because our Nation is
    engaged in a struggle that could well go on for a number of
    years. Our objective is to ensure that our Armed Forces remain
    the best trained, best equipped fighting force in the world and
    that we treat the volunteers who make up the force with the
    respect commensurate with their sacrifice and their dedication.
        Before turning to questions, let me make some comments in
    response to your request on the subject of intelligence and WMD
    and the testimony that Dr. Kay presented to this committee.
    During my confirmation hearing before this committee, I was
    asked what would keep me up at night, and I answered,
    ``Intelligence.'' I said that because the challenge facing the
    Intelligence Community today is truly difficult. Their task is
    to penetrate closed societies--and you might want to put that
    picture of a closed society up----

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        --and organizations and try and learn things our
    adversaries do not want them to know.
        That is the Korean Peninsula. The Demilitarized Zone (DMZ)
    is the line in the middle. South Korea, the same people as in
    North Korea, has light. It is a satellite photo. It has light
    and energy and opportunity and a vibrant, democratic system.
    North Korea is a dark, dark country. The little dot of light to
    the left in the center of North Korea is Pyongyang.
        So their task is to penetrate these closed societies and
    organizations, to try and learn things that our adversaries do
    not want them to know, the Intelligence Community, often not
    knowing precisely what it is that we need to know, while our
    adversaries know precisely what it is that they do not want
    them to know. That is a tough assignment.
        Intelligence agencies are operating in a era of surprise,
    when new threats can emerge suddenly, with little or no
    warning, as happened on September 11. It is their task to try
    to connect the dots before the fact, not after the fact. It is
    hard enough after the fact, but they are trying to connect the
    dots before the fact so action can be taken to protect the
    American people.
        They have to do this in an age when the margin for error is
    modest, when terrorist networks and terrorist states are
    pursuing weapons of mass destruction and the consequences of
    underestimating a threat could be the loss of potentially tens
    of thousands of lives. The men and women in the Intelligence
    Community have a tough and often thankless job. If they fail
    the world knows it, and when they succeed, as they often do, to
    our country's great benefit, their accomplishments often have
    to remain secret.
        Though we cannot discuss those successes always in open
    session, it would be worth the committee's time to hear of
    them, and I hope and trust that the Director of Central
    Intelligence, George Tenet, will be able to make some of those
    recent examples of successes--and there have been many--public
    so that the impression that has and is being created of broad
    intelligence failures can be dispelled.
        I can say that the Intelligence Community's support in
    Afghanistan and Iraq, as well as the global war on terror
    overall, have contributed to the speed, the precision, and the
    success of those operations and saved countless lives. We are
    blessed that so many fine individuals have stepped forward to
    serve in the Intelligence Community and are willing to work
    under great pressure and in more than a few cases risk their
    lives.
        They faced a difficult challenge in the case of Iraq. They
    knew the history of the Iraqi regime, its use of chemical
    weapons on its own people and its neighbors. They knew what had
    been discovered during the inspections after the Persian Gulf
    War, some of which was far more advanced, particularly the
    nuclear program, than the pre-Gulf War intelligence had
    indicated. They were keen observers of the reports of the U.N.
    Special Commission (UNSCOM) in the 1990s. They and others did
    their best to penetrate the secrets of the regime of Saddam
    Hussein after the inspectors left in 1998.
        It was the consensus of the Intelligence Community and of
    successive administrations of political parties and of Congress
    that reviewed the same intelligence and much of the
    international community, I might add, that Saddam Hussein was
    pursuing WMD. Saddam Hussein's behavior throughout that period
    reinforced that conclusion. He did not behave like someone who
    was disarming and wanted to prove he was doing so. He did not
    open up his country to the world, as Kazakhstan, Ukraine, and
    South Africa had previously done and as Libya is doing today.
        Instead, he continued to give up tens of billions of
    dollars in oil revenues under U.N. sanctions when he could have
    had the sanctions lifted and received those billions of dollars
    simply by demonstrating that he had disarmed if in fact he had.
    Why did he do this?
        His regime filed with the U.N. what almost everyone agreed
    was a fraudulent declaration and ignored the final opportunity
    afforded him by U.N. Security Council Resolution 1441. Why?
        Congress and the national security teams of both the
    Clinton and the Bush administrations looked at essentially the
    same intelligence. They came to similar conclusions: the Iraqi
    regime posed a danger and should be changed. Congress passed
    regime change legislation in 1998. In the end, the coalition of
    nations decided to enforce the U.N.'s resolutions.
        Dr. David Kay served in Iraq for some 6 months directing
    the work of the ISG and reporting to Director Tenet. He and the
    ISG have worked hard under difficult and dangerous conditions.
    They have brought forward important information. Dr. Kay is a
    scientist and an extremely well experienced weapons inspector.
    He has outlined for the committee his hypothesis on the
    difference between prewar estimates of Iraq's WMD and what has
    been found thus far on the ground.
        While it is too early to come to final conclusions, as he
    indicated, given the work that is still to be done, there are
    several alternative views that are currently being postulated.
    First is the theory that WMD may not have existed at the start
    of the war. I suppose that is possible but not likely.
        Second is that it is possible that WMD did exist but was
    transferred in whole or in part to one or more other countries.
    We see that theory put forward.
        Third, it is possible that the WMD existed but was
    dispersed and hidden throughout Iraq. We see that possibility
    proposed by various people.
        Next, that it is possible that WMD existed but was
    destroyed at some moment prior to the end--the beginning of the
    conflict--or that it is possible that Iraq had small quantities
    of biological or chemical agents and also a surge capability
    for rapid buildup and that we may eventually find it in the
    months ahead.
        Or, finally, there is the theory that some have put forward
    that it could have been a charade by the Iraqis, that Saddam
    Hussein fooled his neighbors and fooled the world; or that
    Saddam Hussein fooled the members of his own regime; or that
    the idea that Saddam Hussein himself might have been fooled by
    his own people, who may have tricked him into believing that he
    had capabilities that Iraq really did not have.
        These are all theories that are being put forward today.
    This much has been confirmed: The Intelligence Community got it
    essentially right on Iraq's missile programs. Iraq was
    exceeding the U.N.-imposed missile range limits and documents
    found by the ISG show evidence of high-level negotiations
    between Iraq and North Korea for the transfer of still longer-
    range missile technology. If we were to accept that Iraq had a
    surge capability for biological and chemical weapons, his
    missiles could have been armed with WMD and used to threaten
    neighboring countries.
        It is the job of Dr. Kay's successor, as the chairman
    indicated, and the ISG to pursue these issues wherever the
    facts may take them. It is a difficult task. Think, it took us
    10 months to find Saddam Hussein. The reality is that the hole
    he was found hiding in was large enough to hold enough
    biological weapons to kill thousands of human beings. Our
    people had gone past that farm several times--had no idea he
    was there. Unlike Saddam Hussein, such objects, once buried,
    can stay buried. In a country the size of California, the
    chances of inspectors finding something buried in the ground
    without their being led to it by people knowledgeable about
    where it was are minimal.
        As Dr. Kay has testified, what we have learned thus far has
    not proven Saddam Hussein had what intelligence indicated and
    what we believed he had. But it also has not proven the
    opposite.
        The ISG's work is some distance from completion. There are
    some 1,300 people in the ISG in Iraq working hard to find
    ground truth. When that work is complete, we will know more.
    Whatever the final outcome, it is important that we seize the
    opportunity to derive lessons learned to inform future
    decisions. In the DOD, the Joint Forces Command has done an
    extensive review of Operation Iraqi Freedom. The Intelligence
    Community is also looking at lessons learned. It is doing it
    under the leadership of Director Tenet with Dr. Kerr. It is
    being done in other elements of the community as well.
        It is important also that we step back and take a look at
    the bigger picture and see that U.S. intelligence capabilities
    are strengthened sufficiently to meet the threats and
    challenges of this century. The President has announced that he
    will be forming a bipartisan commission on strengthening U.S.
    intelligence capabilities. The commission will review the past
    successes of the Intelligence Community as well as the cases
    that have not been successes, to examine whether the
    Intelligence Community has the right skills, the proper
    resources, and the appropriate authorities to meet the
    challenges and the threats of the 21st century.
        Intelligence will never be perfect. We do not, will not,
    and cannot know everything that is going on in this world of
    ours. If at this important moment we mistake intelligence for
    irrefutable evidence, analysts might become hesitant to inform
    policymakers of what they think they know and what they know
    that they do not know, and even what they think. Policymakers
    bereft of intelligence will find themselves much less able to
    make prudential judgments, the judgments necessary to protect
    our country.
        I am convinced that the President of the United States did
    the right thing in Iraq, let there be no doubt. I came to my
    conclusions based on the intelligence we all saw, just as each
    of you made your judgments and cast your votes based on the
    same information. The President has sworn to preserve, protect
    and defend the Nation. With respect to Iraq, he took the
    available evidence into account; he took into account September
    11; he took into account Saddam Hussein's behavior of
    deception; he took into account Iraq's ongoing defiance of the
    U.N. and the fact that he was still shooting at U.S. and U.K.
    aircraft and the crews that were enforcing U.N. resolutions in
    northern and southern no-fly zones; and he took into account
    the fact that this was a vicious regime that had used WMD
    against its own people and its neighbors and murdered and
    tortured the Iraqi people for decades.
        The President went to the U.N. and the Security Council and
    passed a seventeenth resolution, and he came here to this
    Congress and, based on the same intelligence, you voted to
    support military action if the Iraqi regime failed to take that
    final opportunity to cooperate with the U.N.
        When Saddam Hussein did pass up that final opportunity, the
    President nonetheless gave him an ultimatum, a final final
    opportunity to leave the country. Only then, when all
    alternatives had been fully exhausted, did the coalition act to
    liberate Iraq. Ours is a safer world today, and the Iraqi
    people are far better off for that action.
        Senator Warner asked in his opening statement if I know of
    any pressure on intelligence people or manipulation of
    intelligence, and the answer is absolutely not. I believe that
    Senator Roberts has attested to that from the analysts and
    witnesses that he and his committee have interrogated over a
    period of many months. I believe that Dr. Kay answered exactly
    the same way--that he talked to analyst after analyst and no
    manipulation of the data and no indication of anyone expressing
    concern about pressure.
        I thank you, Mr. Chairman, and I would be happy to turn it
    over to General Pete Pace.
        [The prepared statement of Secretary Rumsfeld follows:]
                 Prepared Statement by Hon. Donald H. Rumsfeld
                                  introduction
        Mr. Chairman, members of the committee, I am pleased to be here
    today to discuss the progress in the global war on terrorism, our
    transformation efforts, and to discuss the President's 2005 budget
    request for the Department of Defense.
        First, I want to commend the courageous men and women in uniform
    and the Department civilians who support them. They are remarkable--and
    what they have accomplished since our country was attacked 28 months
    ago is truly impressive. In less than 2\1/2\ years, they have:

             Overthrown two terrorist regimes, rescued two nations,
            and liberated some 50 million people;
             Captured or killed 45 of the 55 most wanted in Iraq--
            including Iraq's deposed dictator, Saddam Hussein;
             Hunted down thousands of terrorists and regime
            remnants in Iraq and Afghanistan;
             Captured or killed close to two-thirds of known senior
            al Qaeda operatives;
             Disrupted terrorist cells on most continents; and
             Likely prevented a number of planned terrorist
            attacks.

        Our forces are steadfast and determined. We value their service and
    sacrifice, and the sacrifice of their families, who also serve.
        We thank the members of this committee for the support you have
    shown for the troops during the global war on terror. With your
    support, we have the finest Armed Forces on the face of the Earth.
        We have a common challenge: to support the troops and to make sure
    they have what they will need to defend the Nation in the years ahead.
        We are working to do that in a number of ways:

             By giving them the tools they need to win the global
            war on terror;
             By transforming for the 21st century, so they will
            have the training and tools they need to prevail in the next
            wars our Nation may have to fight--wars which could be notably
            different from today's challenges; and
             By working to ensure that we manage the force
            properly--so we can continue to attract and retain the best and
            brightest, and sustain the quality of the All-Volunteer Force.

        Each represents a significant challenge in its own right. Yet we
    must accomplish all of these critical tasks at once.
        When this administration took office 3 years ago, the President
    charged us with a mission--to challenge the status quo, and prepare the
    Department of Defense to meet the new threats our Nation will face as
    the 21st century unfolds.
        We have done a good deal to meet that charge. Consider just some of
    what has been accomplished:

             We have fashioned a new defense strategy, a new force
            sizing construct, and a new approach to balancing risks--one
            that takes into account not just the risks in immediate war
            plans, but also the risks to people and transformation.
             We have moved from a ``threat-based'' to a
            ``capabilities-based'' approach to defense planning, focusing
            not only on who might threaten us, or where, or when--but more
            on how we might be threatened, and what portfolio of
            capabilities we will need to deter and defend against those new
            threats.
             We have fashioned a new Unified Command Plan, with

                     A new Northern Command, that became fully
                    operational last September, to better defend the
                    homeland;
                     The Joint Forces Command focused on
                    transformation; and
                     A new Strategic Command responsible for early
                    warning of, and defense against, missile attack and the
                    conduct of long-range attacks.

             We have also transformed the Special Operations
            Command, expanding its capabilities and its missions, so that
            it can not only support missions directed by the regional
            combatant commanders, but also plan and execute its own
            missions in the global war on terror, supported by other
            combatant commands.
             We have taken critical steps to attract and retain
            talent in our Armed Forces--including targeted pay raises and
            quality of life improvements for the troops and their families.
             We have instituted realistic budgeting, so the
            Department now looks to emergency supplementals for the unknown
            costs of fighting wars, not to sustain readiness.
             We have reorganized the Department to better focus our
            space activities.
             Congress has established a new Under Secretary of
            Defense for Intelligence and an Assistant Secretary of Defense
            for Homeland Defense.
             We have completed the Nuclear Posture Review, and
            adopted a new approach to deterrence that will enhance our
            security, while permitting historic deep reductions in
            offensive nuclear weapons.
             We have pursued a new approach to developing military
            capabilities. Instead of developing a picture of the perfect
            system and then building the system to meet that vision of
            perfection, however long it takes or costs, the new approach is
            to start with the basics, roll out early models faster, and
            then add capabilities to the basic system as they become
            available.
             We have reorganized and revitalized the missile
            defense research, development, and testing program, and are on
            track to begin deployment of our Nation's first rudimentary
            ballistic missile defenses later this year.
             We have established new strategic relationships, that
            would have been unimaginable just a decade ago, with nations in
            Central Asia, the Caucasus, and other critical areas of the
            world.
             We have transformed the way the Department prepares
            its war plans--reducing the time it takes to develop those
            plans, increasing the frequency with which they are updated,
            and structuring our plans to be flexible and adaptable to
            changes in the security environment.
             We adopted a new ``Lessons Learned'' approach during
            Operation Iraqi Freedom, embedding a team with U.S. Central
            Command that not only studied lessons for future military
            campaigns, but provided real-time feedback that had an
            immediate impact on our success in Iraq.
             We made a number of key program decisions that are
            already having a favorable impact on the capability of the
            force. Among others:

                     We are converting four Trident nuclear-powered
                    ballistic missile submarines (SSBN) into conventional
                    nuclear-powered cruise missile attack submarines (SSGN)
                    capable of delivering special forces and cruise
                    missiles into denied areas.
                     The Army has deployed its first Stryker
                    brigade to Iraq, is completing conversion of the
                    second, and is replacing the Crusader with a new family
                    of precision artillery that is being developed for the
                    Future Combat System.
                     We have revitalized the B-1 bomber fleet by
                    reducing its size and using the savings to modernize
                    the remaining aircraft with precision weapons and other
                    critical upgrades.

             We have also undertaken a comprehensive review of our
            global force posture, so we can transform U.S. global
            capabilities from a structure driven by where the wars of the
            20th century ended, to one that positions us to deal with the
            new threats of the 21st century security environment.
             Using authority granted to us last year, we have
            established a new Joint National Training Capability, that will
            help us push joint operational concepts throughout the
            Department, so our forces train and prepare for war the way
            they will fight it--jointly.
             We have worked with our Allies to bring NATO into the
            21st century--standing up a new NATO Response Force that can
            deploy in days and weeks instead of months or years, and
            transforming the NATO Command Structure--including the creation
            of a new NATO command to drive Alliance transformation.
             With the help of Congress last year, we are now
            establishing a new National Security Personnel System that
            should help us better manage our 746,000 civilian employees,
            and we are using the new authorities granted us last year to
            preserve military training ranges while keeping our commitment
            to responsible stewardship of the environment.

        The scope and scale of what has been accomplished is remarkable. It
    will have an impact on the capability of our Armed Forces for many
    years to come.
        We will need your continued support as we go into the critical year
    ahead.
        Our challenge is to build on these successes, and continue the
    transformation efforts that are now underway. In 2004, our objectives
    are to:

             Successfully prosecute the global war on terror;
             Further strengthen our combined and joint warfighting
            capabilities;
             Continue transforming the joint force, making it
            lighter, more agile and more easily deployable, and instilling
            a culture that rewards innovation and intelligent risk-taking;
             Strengthen our intelligence capabilities, and refocus
            our intelligence efforts to support the new defense strategy
            and our contingency plans;
             Reverse the existing WMD capabilities of unfriendly
            states and non-state actors, and stop the global spread of WMD;
             Improve our management of the force;
             Refocus our overseas presence, further strengthen key
            alliances, and improve our security cooperation with nations
            that are likely partners in future contingencies;
             Continue improving and refining DOD's role in homeland
            security and homeland defense; and
             Further streamline DOD processes, continuing financial
            management reform, and shortening acquisition cycle times.

        So, we have an ambitious agenda. But none of these tasks can be put
    off.
        Our task is to prepare now for the tomorrow's challenges, even as
    we fight today's war on terror.
                               managing the force
        One effect of the global war on terror has been a significant
    increase in operational tempo, which has resulted in an increased
    demand on the force. Managing the demand on the force is one of our top
    priorities. But to do so, we must be clear about the problem--so we can
    work together to fashion the appropriate solutions.
        The increased demand on the force we are experiencing today is
    likely a ``spike,'' driven by the deployment of nearly 115,000 troops
    in Iraq. We hope and anticipate that that spike will be temporary. We
    do not expect to have 115,000 troops permanently deployed in any one
    campaign.
        But for the moment, the increased demand is real--and we are taking
    a number of immediate actions. Among other things:

             We are increasing international military participation
            in Iraq.

                     As the President noted in his State of the
                    Union address, 34 countries now have forces deployed in
                    Iraq with U.S. forces and Iraqi security forces.
                     Japan began deploying its Self-Defense Forces
                    to Iraq last month--the first time Japanese forces have
                    been deployed outside their country since the end of
                    World War II.

             As more international forces deploy, we have
            accelerated the training of Iraqi security forces--now more
            than 200,000-strong--to hasten the day when the Iraqis
            themselves will be able to take responsibility for the security
            and stability of their country, and all foreign forces can
            leave.
             As we increase Iraq's capability to defend itself, our
            forces are dealing aggressively with the threat--hunting down
            those who threaten Iraq's stability and transition to self-
            reliance.

        Another way to deal with the increased demand on the force is to
    add more people. We have already done so. Using the special powers
    granted by Congress, we have increased force levels by nearly 33,000
    above the pre-emergency authorized end strength.

             The Army is up roughly 7,800 above authorized end
            strength;
             The Navy is up roughly 6,000;
             The Marine Corps is up some 2,000, and
             The Air Force is up about 17,000.

        If the war on terror demands it, we will not hesitate to increase
    force levels even more using our emergency authorities. Because we are
    using emergency powers, we have the flexibility to reduce force levels
    in the period ahead, as the security situation permits, and as our
    transformation efficiencies bear fruit.
        But it should give us pause that even a temporary increase in our
    force levels was, and remains, necessary. Think about it: At this
    moment we have a force of 2.6 million people, both active and Reserve:

             1.4 million Active Forces,
             876,000 in the Selected Reserve--that is the Guard and
            Reserve Forces in units; and
             An additional 287,000 in the Individual Ready
            Reserves.

        Yet, despite these large numbers, the deployment of 115,000 troops
    in Iraq has required that we temporarily increase the size of the force
    by some 33,000.
        That should tell us a great deal about how our forces are
    organized.
        It suggests strongly that the real problem is not the size of the
    force, per se, but rather the way the force has been managed, and the
    mix of capabilities at our disposal. It suggests that our challenge is
    considerably more complex than simply adding more troops.
        General Pete Schoomaker, the Army Chief of Staff, compares the
    problem to a barrel of rainwater, on which the spigot is placed too
    high up. When you turn it on, it only draws water off the top, while
    the water at the bottom can't be used. The answer to this problem is
    most certainly not a bigger rain barrel; the answer is to move the
    spigot down, so that more of the water is accessible and can be used.
        In other words, our challenge today is not simply one of increasing
    the size of the force. Rather, we must better manage the force we
    have--to make sure we have enough people in the right skill sets and so
    that we take full advantage of the skills and talents of everyone who
    steps forward and volunteers to serve.
        Consider another example: I keep hearing people talk about the
    stress on the Guard and Reserve--that we can't keep calling them up for
    repeated mobilizations. Well the fact is, since September 11, 2001, we
    have mobilized roughly 36 percent of the Selected Reserve--a little
    over one-third of the available forces--and most of those mobilizations
    are concentrated in certain skill sets. For example:

             We have called up 86 percent of enlisted installation
            security forces
             69 percent of enlisted law enforcement forces
             67 percent of enlisted air crews
             65 percent of enlisted special forces
             56 percent of civil affairs officers
             51 percent of military police officers
             48 percent of intelligence officers

        But, while certain skills are in demand, only a tiny fraction of
    the Guard and Reserve--just 7.15 percent--have been called up more than
    once since 1990. The vast majority of our Guard and Reserve Forces--
    over 60 percent--have not been mobilized to fight the global war on
    terror. Indeed, I am told that a full 58 percent of the current
    Selected Reserve--or about 500,000 troops--have not been involuntarily
    mobilized in the past 10 years.
        What does that tell us?

             First, it argues that we have too few Guard and
            Reserve Forces with certain skill sets that are high demand and
            too many Guard and Reserve with skills that are in little or no
            demand.
             Second, it indicates that we need to rebalance the
            skill sets within the Reserve component, and between the active
            and Reserve components, so we have enough of the right kinds of
            forces available to accomplish our missions.
             Third, it suggests that we need to do a far better job
            of managing the force. That requires that we focus not just on
            the number of troops available today--though that is
            important--but on transforming the forces for the future,
            making sure we continue to increase the capability of the
            force, and thus our ability to do more with fewer forces.

        We are working to do just that.
                              mass vs. capability
        One thing we have learned in the global war on terror is that, in
    the 21st century, what is critical to success in military conflict is
    not necessarily mass as much as it is capability.
        In Operation Iraqi Freedom, coalition forces defeated a larger
    adversary. They did it not by bringing more troops to the fight, which
    we could have done, but by overmatching the enemy with superior speed,
    power, precision and agility.
        To win the wars of the 21st century, the task is to make certain
    our forces are arranged in a way to ensure we can defeat any adversary,
    and conduct all of the operations necessary to achieve our strategic
    objectives.
        In looking at our global force posture review, some observers have
    focused on the number of troops, tanks, or ships that we might add or
    remove in a given part of the world. I would submit that that may well
    not be the best measure.
        If you have 10 of something--say ships, for the sake of argument--
    and you reduce the number by 5, you end up with 50 percent fewer of
    them. But if you replace the remaining five ships with ships that have
    double the capability of those removed, then obviously you have not
    reduced capability even though the numbers have been reduced.
        The same is true as we look at the overall size of the force. What
    is critical is the capability of the Armed Forces to project power
    quickly, precisely, and effectively anywhere in the world.
        For example, today the Navy is reducing force levels. Yet because
    of the way they are arranging themselves, they will have more combat
    power available than they did when they had more people.
        In Operation Iraqi Freedom, the Navy surged more than half the
    fleet to the Persian Gulf region for the fight. With the end of major
    combat operations, instead of keeping two or three carrier strike
    groups forward deployed, as has been traditional Navy practice, they
    quickly redeployed all their carrier strike groups to home base. By
    doing so, they reset their force in a way that will allow them to surge
    over 50 percent more combat power on short notice to deal with future
    contingencies.
        The result? Today, six aircraft carrier strike groups are available
    to respond immediately to any crisis that might confront us. That
    capability, coupled with the application of new technologies, gives the
    Navy growing combat power and greater flexibility to deal with global
    crises--all while the Navy is moderately reducing the size of its
    Active Force.
        The Army, by contrast, has put forward a plan that, by using
    emergency powers, will increase the size of its Active Force by roughly
    6 percent or up to 30,000 troops above authorized end strength. But
    because of the way they will do it, General Schoomaker estimates the
    Army will be adding not 6 percent, but up to 30 percent more combat
    power.
        This is possible because, instead of adding more divisions, the
    Army is moving away from the Napoleonic division structure designed in
    the 19th century, focusing instead on creating a 21st century ``Modular
    Army'' made up of self-contained, more self-sustaining brigades that
    are available to work for any division commander.
        So, for example, in the event of a crisis, the 4th Infantry
    Division commander could gather two of his own brigades, and combine
    them with available brigades from, say, the 1st Armored Division and
    the National Guard, and deploy them together. The result of this
    approach is jointness within the Service, as well as between the
    Services. That jointness--combined with other measures--means that 75
    percent of the Army's brigade structure should always be ready in the
    event of a crisis.
        The Army's plan would increase the number of active and Reserve
    brigades significantly over the next 4 years. But because we will be
    using emergency powers, we will have the flexibility to reduce the
    number of troops if the security situation permits--so the Army would
    not be faced with the substantial cost of supporting a larger force as
    the security situation and the efficiencies permit.
        Yet even if the security situation, and our progress in
    transformation, were to permit the Army to draw down the force, the new
    way they are arranging their forces will ensure the U.S. still has more
    ground combat power--more capability.
        So we have two different approaches:

             In one case, the Navy is reducing force levels while
            increasing capability;
             In the other, the Army is increasing troop levels--but
            doing so in a way that will significantly increase its
            capability.
             In both cases, the increase in capability of each
            Service will be significant.

        The point is: our focus needs to be on more than just numbers of
    troops. It should be on finding ways to better manage the forces we
    have, and by increasing the speed, agility, modularity, capability, and
    usability of those forces.
                                dod initiatives
        Today, using authorities and flexibility Congress has provided, DOD
    has several dozen initiatives underway to improve management of the
    force, and increase its capability.
        Among other things:

             We are investing in new information age technologies,
            precision weapons, unmanned air and sea vehicles, and other
            less manpower-intensive platforms and technologies.
             We are working to increase the jointness of our
            forces, creating power that exceeds the sum of individual
            services.
             We are using new flexibility under the Defense
            Transformation Act to take civilian tasks currently done by
            uniformed personnel and convert them into civilian jobs--
            freeing military personnel for military tasks.
             This year, we will begin to move 10,000 military
            personnel out of civilian tasks and return them to the
            operational force--effectively increasing force levels by an
            additional 10,000 service members in 2004. An additional 10,000
            conversions are planned for 2005.
             We have begun consultations with allies and friends
            about ways to transform our global force posture to further
            increase capability.

        We are also working to rebalance the active and Reserve components.
    We are taking skills that are now found almost exclusively in Reserve
    components and moving them into the Active Force, so that we are not
    completely reliant on the Guard and Reserve for those needed skills. In
    both the active and Reserve components, we are moving forces out of low
    demand specialties, such as heavy artillery, and into high-demand
    capabilities such as military police, civil affairs, and Special
    Operations Forces.
        Already, in 2003, the Services have rebalanced some 10,000
    positions within and between the active and Reserve components. For
    example, the Army is already transforming 18 Reserve field artillery
    batteries into military police. We intend to expand those efforts this
    year, with the Services rebalancing an additional 20,000 positions in
    2004, and 20,000 more in 2005--for a total of 50,000 rebalanced
    positions by the end of next year.
        We are also working to establish a new approach to military force
    management called ``Continuum of Service.'' The idea is to create a
    bridge between the active and Reserve components--allowing both Active
    and Reserve Forces greater flexibility to move back and forth between
    full-time and part-time status, and facilitating different levels of
    participation along that continuum.
        Under this approach, a reservist who normally trains 38 days a year
    could volunteer to move to full-time service for a period of time--or
    some increased level of service between full-time and his normal
    Reserve commitment, offering options for expanded service that do not
    require abandoning civilian life. Similarly, an active service member
    could request transfer into the Reserve component for a period of time,
    or some status in between, without jeopardizing his or her career and
    opportunity for promotion. It would give military retirees with needed
    skills an opportunity to return to the Service on a flexible basis--and
    create opportunities for others with specialized skills to serve, so we
    can take advantage of their experience when the country needs it.
        For example, coalition forces in Iraq need skilled linguists--so
    under the Continuum of Service approach we have recruited 164 Iraqi-
    Americans into a special Individual Ready Reserve program, and expect
    to deploy the first program graduates to Iraq this spring.
        The ``Continuum of Service'' would allow the Armed Forces to better
    take advantage of the high-tech skills many reservists have developed
    by virtue of their private sector experience--while at the same time
    creating opportunities for those in the Active Force to acquire those
    kinds of skills and experiences. It encourages volunteerism and
    improves our capability to manage the military workforce in a flexible
    manner with options that currently exist only in the private sector.
        We have also been working to fix the mobilization process. We have
    worked hard over the past year to add more refined planning tools to
    the process, and make it more respectful of the troops, their families,
    and their employers. Among other things:

             We have tried to provide earlier notifications, giving
            troops as much notice as possible before they are mobilized, so
            they can prepare and arrange their lives before being called
            up;
             We have worked to ensure that when they are called up,
            it is for something important and needed--and not to replace
            someone in a task that could wait until a contingency is over;
             We've tried to ensure that the number of people who
            have been recently mobilized is as small as possible, and that
            as many of the forces as possible that are remobilized or
            extended are volunteers;
             We have tried to limit tours, and give the troops some
            certainty about the maximum length of their mobilization and
            when they can expect to resume civilian life. We are doing
            better, but in my opinion, the process is still not good
            enough.

        We are working each day to make the process better, and more
    respectful of the brave men and women who make up the Guard and
    Reserve.
        As you can see, we have a number of initiatives underway that we
    are confident will improve the management and treatment of the Guard
    and Reserve Forces.
        The men and women who make up the Guard and Reserve are all
    volunteers. They signed up because they love their country, and want to
    serve when the country needs them.
        A number of you on this committee have served in the Guard and
    Reserve, as have I. Each of us knew when we signed up, it was not to
    serve 1 weekend a month and 2 weeks active duty. We signed up so that
    if war was visited upon our country, we would be ready to leave our
    work and family, and become part of the Active-Duty Force.
        Well, on September 11, war was visited on our country. Our nation
    was attacked--more than 3,000 innocent men, women, and children were
    killed in an instant. At this moment, in caves and underground bunkers
    half-a-world away, dangerous adversaries are planning new attacks--
    attacks they hope will be even more deadly than the one on September
    11.
        We are a nation at war. If we were not to call up the Guard and
    Reserves today, then why would we want to have them at all? Why were we
    asking them to sacrifice time with their families every month to train?
    Why are the taxpayers paying for postservice benefits, including
    healthcare and retirement pay, that add up to between $250,000 and
    $500,000 per reservist?
        This is the purpose of the Guard and Reserve. It is what they
    signed up for. I know that the vast majority are eager to be in the
    fight--a fact born out by the large number of those who stepped forward
    and volunteered to be mobilized for service in Iraq.
        Our challenge--our responsibility--is to do everything we can to
    see that they are treated respectfully, managed effectively, and that
    they have the tools they need to win today's war, and to deter future
    wars.
        We are working to do just that--to better manage the force, and to
    transform the force to make it more capable for the 21st century.
        Today, with authority granted by Congress, DOD has the flexibility
    to adjust troop levels, as the security situation requires.

             We have authority to increase or decrease, as need
            arises.
             We are using that authority; and
             We are working on a number of new initiatives that
            will allow us to better manage and transform the force.

        However, we believe that a statutory end strength increase would
    take away our current flexibility to manage the force:

             First, if the current increased demand turns out to be
            a spike and if we are successful in the transformation and
            rebalancing initiatives underway, the Department would face the
            substantial cost of supporting a larger force when it may no
            longer be needed--pay and benefits, such as lifetime
            healthcare, for each service member added, not to mention the
            additional costs in equipment, facilities, and force
            protection.
             Second, if we permanently increase statutory end
            strength, instead of using the already available emergency
            powers, we will have to take the cost out of our top line. That
            will require cuts in other parts of the defense budget--
            crowding out investments in the very programs that will allow
            us to manage the force and make it more capable.

        None of us has a crystal ball to see into the future. You have
    given us the authority to adjust the size of the force and the
    flexibility to deal with unknowns. We have been using that authority
    over the past 2-plus years, even as we work to implement comprehensive
    measures to better manage the force. I urge Congress to not lock us
    into a force size and structure that may or may not be appropriate in
    the period ahead.
        Instead, help us to support the Armed Services with the
    transformational initiatives they now have underway; help us rebalance
    the Active and Reserve Force, and give the troops more options to
    contribute along an expanded continuum of service; help us add
    capability, and transform the force for the future.
                                  2005 budget
        The President's 2005 budget requests the funds to do just that.
        The President's first defense budgets were designed while our
    defense strategy review was still taking place. It was last year's
    budget--the 2004 request--that was the first to fully reflect the new
    defense strategies and policies.
        One of the key budget reforms we implemented last year is the
    establishment of a 2-year budgeting process in the Department of
    Defense--so that the hundreds of people who invest time and energy to
    rebuild major programs every year can be freed up and not be required
    to do so on an annual basis, and can focus more effectively on
    implementation.
        The 2005 budget before you is, in a real sense, a request for the
    second installment of funding for the priorities set out in the
    President's 2004 request.
        We did not rebuild every program. We made changes to just 5 percent
    of the Department's planned 2005 budget, and then only on high-interest
    and must-fix issues--and then only when the costs incurred to mitigate
    risks could be matched by savings elsewhere in the budget.
        The President's 2005 budget requests continued investments to
    support the six transformational goals we identified in our 2001
    defense review:

             First, we must be able to defend the U.S. homeland and
            bases of operation overseas;
             Second, we must be able to project and sustain forces
            in distant theaters;
             Third, we must be able to deny enemies sanctuary;
             Fourth, we must improve our space capabilities and
            maintain unhindered access to space;
             Fifth, we must harness our advantages in information
            technology to link up different kinds of U.S. forces, so they
            can fight jointly; and
             Sixth, we must be able to protect U.S. information
            networks from attack--and to disable the information networks
            of our adversaries.

        In all, in 2005, we have requested $29 billion for investments in
    transforming military capabilities that will support each of these
    critical objectives.
        The President's 2005 budget requests $10.3 billion for missile
    defense, including:

             $9.2 billion for the Missile Defense Agency--an
            increase of $1.5 billion above the President's 2004 request;
            and
             $1 billion for Patriot Advanced Capability-3, the
            Medium Extended Air Defense System, and other short and medium
            range capabilities;

        The budget also includes $239 million in funding for accelerated
    development of Cruise Missile Defense, with the goal of fielding an
    initial capability in 2008;
        The 2005 budget request includes critical funds for Army
    Transformation, including:

             $3.2 billion to support continued development of the
            Future Combat Systems--an increase of $1.5 billion over the
            2004 budget; and
             $1.0 billion to fund continued deployment of the new
            Stryker Brigade Combat Teams, such as the one now serving in
            Iraq.

        We have also requested additional funds to strengthen intelligence,
    including critical funds to increase DOD Human Intelligence (HUMINT)
    capabilities, persistent surveillance, as well as technical analysis
    and information sharing to help us better ``connect the dots.''
        To enhance our communications and intelligence activities, we are
    requesting:

             $408 million to continue development of the Space
            Based Radar (SBR)--which will bring potent and transformational
            capabilities to joint warfighting--the ability to monitor both
            fixed and mobile targets, deep behind enemy lines and over
            denied areas, in any kind of weather. SBR is the only system
            that can provide such capability.
             $775 million for the Transformational Communications
            Satellite (TSAT) which will provide the joint warfighter with
            unprecedented communication capability. To give you an idea of
            the speed and situational awareness the TSAT will provide,
            consider that transmitting a Global Hawk image over a current
            Milstar II, as we do today, takes over 12 minutes with TSAT it
            will take less than a second.
             $600 million for the Joint Tactical Radio System, to
            provide wireless internet capability to enable information
            exchange among joint warfighters.

        The budget also requests $700 million for Joint Unmanned Combat Air
    Systems (J-UCAS)--a program that consolidates all the various unmanned
    combat air vehicle programs, and focuses on developing a common
    operating system.
        The budget requests $14.1 billion for major tactical aircraft
    programs, including:

             $4.6 billion for the restructured Joint Strike Fighter
            (JSF) program;
             $4.7 billion to continue procurement of the F/A-22;
             $3.1 billion to continue procurement of the F/A-18E/F;
            and
             $1.7 billion to support development and procurement of
            11 V-22 aircraft.

        The budget requests funds for Navy fleet transformation, including
    $1 billion to continue funding the new CVN-21 aircraft carrier, and
    $1.6 billion to continue development of a family of 21st century
    surface combatants including the DDX destroyer, the littoral combat
    ship, and the CG(X) cruiser.
        We have requested $11.1 billion to support procurement of 9 ships
    in 2005. Fiscal year 2005 begins a period of transition and
    transformation for shipbuilding as the last DDG 51 destroyers are
    built, and the first DD(X) destroyer and Littoral Combat Ship are
    procured. This increased commitment is further shown in the average
    shipbuilding rate for fiscal years 2005-2009 of 9.6 ships per year.
    This will sustain the current force level and significantly add to Navy
    capabilities.
        In all, the President has requested $75 billion for procurement in
    2005 and $69 billion for Research, Development, Testing and
    Evaluation--funds that are vital to our transformation efforts.
        Another area critical to transformation is joint training. Last
    year, Congress approved funding to establish a new Joint National
    Training Capability (JNTC), an important initiative that will
    fundamentally change the way our Armed Forces train for 21st century
    combat.
        We saw the power of joint warfighting in Operation Iraqi Freedom.
    Our challenge is to bring that kind of joint warfighting experience to
    the rest of the forces, through both live and virtual joint training
    and exercises. Thanks to the funds authorized in the 2004 budget, the
    JNTC's initial operating capability is scheduled to come online in
    October of this year. We have requested $191 million to continue and
    expand the JNTC in 2005.
        With your help, we have put a stop to the past practice of raiding
    investment accounts to pay for the immediate operation and maintenance
    needs. The 2005 request continues that practice. We have requested full
    funding for the military's readiness accounts, providing $140.6 billion
    for Operation and Maintenance (O&M) including $43 billion for training
    and operations. These funds are critical to transformation because they
    allow us to pay today's urgent bills without robbing the future to do
    so.
        We have also requested funds to support pay and quality of life
    improvements for the troops--including a 3.5 percent military base pay
    raise. We have requested funds in the 2005 budget that will also help
    the Department keep its commitment to eliminate 90 percent of
    inadequate military family housing units by 2007, with complete
    elimination projected for 2009. We have requested funds to complete the
    elimination of out-of-pocket housing costs for military personnel
    living in private housing. Before 2001, the average service member had
    to absorb over 18 percent of these costs. By the end of fiscal year
    2005, it will be zero. These investments are important to the troops,
    and also to their families, who also serve--and deserve to live in
    decent and affordable housing.
        I am also appointing a commission to conduct a comprehensive review
    of military compensation and benefits, with a view toward simplifying
    and improving them. Today, we have too many pay categories that serve
    overlapping purposes, or provide incentives where they are most needed.
    Before making major changes, I urge you to allow the Department to
    first develop a comprehensive and integrated set of compensation
    proposals, which we will submit to you next year.
        We are also making progress in getting our facilities replacement
    and recapitalization rate in proper alignment. When we arrived in 2001,
    the Department was replacing its buildings at a totally unacceptable
    average of once every 192 years. Today, we have moved the rate down for
    the third straight year, though it is still too high--to an average of
    107 years. The 2005 budget requests $4.3 billion for facilities
    recapitalization, keeping us on track toward reaching our target rate
    of 67 years by 2008. We have funded 95 percent of facilities
    maintenance requirements--up from 93 percent in fiscal year 2004.
        The budget also supports our continuing efforts to transform the
    way DOD does business. With the passage of the Defense Transformation
    Act last year, we now have the needed authority to establish a new
    National Security Personnel System, so we can better manage DOD's
    civilian personnel. Initial implementation will begin this year, and
    cover roughly 300,000 of DOD's 746,000 civilian employees.
        Yet, while progress has been made, the Defense Department still
    remains bogged down by bureaucratic processes of the industrial age,
    not the information age. We are working to change that. To help us do
    so, we have requested funds for a Business Management Modernization
    Program that will help us overhaul DOD management processes and the
    information technology systems that support them.
        We have also requested that Congress nearly double the Department's
    General Transfer Authority, from the current limit of $2.1 billion to
    $4 billion, or roughly 1 percent of the DOD budget. In an age when
    terrorists move information at the speed of an email, money at the
    speed of a wire transfer, and people at the speed of a commercial
    jetliner, it is critical that we have the ability to shift funds
    between priorities.
        We also need your continuing support for two initiatives that are
    critical to 21st century transformation: the Global Posture Review, and
    the Base Realignment and Closure (BRAC) Commission round scheduled for
    2005.
        Mr. Chairman, I cannot overemphasize the importance of proceeding
    with both of these initiatives.
        We need BRAC to rationalize our infrastructure with the new defense
    strategy, and to eliminate unneeded bases and facilities that are
    costing the taxpayers billions of dollars to support.
        We need the Global Posture Review to help us reposition our forces
    around the world--so they are stationed not simply where the wars of
    the 20th century ended, but rather are arranged in a way that will
    allow them to deter, and as necessary, defeat potential adversaries who
    might threaten our security, or that of our friends and allies, in the
    21st century.
        These two efforts are inextricably linked.
        It is critical that we move forward with both BRAC and the Global
    Posture Review--so we can rationalize our foreign and domestic force
    posture. We appreciate Congress' decision to authorize a BRAC round in
    2005--and will continue to consult with you as we proceed with the
    Global Posture Review.
                                   conclusion
        Mr. Chairman, the President has asked Congress for a total of
    $401.7 billion for fiscal year 2005--an increase over last year's
    budget. Let there be no doubt: it is a large amount of the taxpayer's
    hard-earned money. Such investments will likely be required for a
    number of years to come because our Nation is engaged in a struggle
    that could well go on for a number of years to come.
        Our objective is to ensure that our Armed Forces remain the best
    trained, best equipped fighting force in the world--and that we treat
    the volunteers who make up the force with respect commensurate with
    their service, their sacrifice, and their dedication.
        Their task is not easy: they must fight and win a global war on
    terror that is different from any our Nation as fought before. They
    must do it, while at the same time preparing to fight the wars of 2010
    and beyond--wars which may be as different from today's conflict, as
    the global war on terror is from the conflicts of the 20th century.
        So much is at stake.
        Opportunity and prosperity are not possible without the security
    and stability that our Armed Forces provide.
        The United States can afford whatever is necessary to provide for
    the security of our people and stability in the world. We can continue
    to live as free people because the industriousness and ingenuity of the
    American people have provided the resources to build the most powerful
    and capable Armed Forces in human history--and because we have been
    blessed with the finest young men and women in uniform--volunteers
    all--that the world has known.
        They are courageous; they are selfless; and they are determined.
    They stand between this nation and our adversaries, those who wish to
    visit still further violence on our cities, our homes and our places of
    work. The men and women of the Armed Forces are hunting the enemies of
    freedom down--capturing or killing them in the far corners of the
    world, so they will not kill still more innocent men, women, and
    children here at home.
        We are grateful to them and proud of them. We stand ready to work
    with you to ensure they are treated with the dignity they deserve, and
    the respect they earn every day.
        Thank you, Mr. Chairman. I'd be pleased to respond to questions.

        Chairman Warner. Thank you, Mr. Secretary. That was a very
    strong, informative, and forthright statement, and I commend
    you for it.
        General Pace. Mr. Chairman, members of the committee: Thank
    you very much for this opportunity, and thank you, Mr.
    Chairman, for your words of condolence to General Myers and his
    family. I know they deeply appreciate that.
        General Myers did write a written statement for submission
    to this committee, and I would ask that his statement be
    accepted.
        Chairman Warner. Without objection, the statement of all
    witnesses today will be incorporated in entirety in the record.
        General Pace. Thank you, sir.
        Sir, I will keep my remarks short, but I would be remiss if
    I did not say a couple of things. First, thank you to this
    committee and to Congress for your strong, sustained,
    bipartisan support of the military. I would like to dwell on
    that for a second. This is not a pro forma statement. You said
    in your statement, Mr. Chairman, that we have the best trained,
    best equipped, most capable Armed Forces in the world. We have
    that because of the resources that Congress provides, and we
    deeply appreciate it.
        Second, a thank-you to the service men and women who serve
    our country. They are magnificent. They are doing everything we
    are asking them to do, and we are very proud of what they are
    doing.
        Next, their families who serve at home, whose sacrifices at
    home are often as equal to or greater than the servicemen and
    women that they are providing support to overseas--we owe a
    great debt of gratitude as a Nation to their families.
        We also should thank the employers of our National Guard
    and Reserve. We could not do what we are doing without the
    skills of our Guard and Reserve. They are quality people, and
    because they are quality people, there is no doubt in my mind
    that there are businesses around the United States that have
    gaps of quality in them because their reservist or their
    guardsman is away from home. We deeply appreciate the
    employers' support of those members so they can help protect
    our country.
        We are a Nation at war, but we are not alone. We have
    invaluable coalition partners, and, together with those
    coalition partners, we will protect our homelands and we will
    defeat terrorism.
        This will be a long and difficult fight, but it is a fight
    worthy of the extraordinary efforts of your soldiers, sailors,
    airmen, marines, and coast guardsmen. When you visit them--and
    many of you have and we thank you for that--you look them in
    the eye. You know they get it. They understand what is at
    stake. They are proud of what they are doing. They know that
    their good works do not always make the evening news, but they
    also know that the roads, the hospitals, schools, electric
    grids, power plants, all the things that they are doing to help
    restore the basics of society in both Iraq and Afghanistan, are
    in fact critical to success.
        Their extraordinary efforts have been and must continue to
    be matched here at home by our collective will, patience, and
    commitment. Our Nation and those who defend her deserve no
    less.
        I am proud to sit here before you today representing all
    the men and women of our Armed Forces. I am proud to be a part
    of this process with you, and I look forward to your questions.
        [The prepared statement of General Myers follows:]
               Prepared Statement by Gen. Richard B. Myers, USAF
        I am privileged to report to Congress on the state of the United
    States Armed Forces.
        As they were a year ago, our Nation's soldiers, sailors, airmen,
    marines, and guardsmen are currently operating within our borders and
    around the globe with dedication, courage and professionalism,
    alongside our coalition partners, to accomplish a variety of very
    demanding missions. Global terrorism remains a serious threat, and the
    stakes in the global war on terrorism remain high.
        Over the past year, I have told you that with the patience, will,
    and commitment of our Nation we would win the war on terrorism. The
    support we have received from Congress has been superb. From
    congressional visits to deployed personnel, to support for
    transformational warfighting programs, to funding for security and
    stability operations, to improved pay and benefits for our troops, your
    support for our service men and women has enabled us to make
    significant progress in the war on terrorism.
        We are winning. Saddam Hussein no longer terrorizes the Iraqi
    people or his neighbors; he is in custody awaiting justice. The Iraqi
    people are well on their way to establishing a prosperous and peaceful
    future. They have already assumed a significant role in providing for
    their own security, and the list of important accomplishments in every
    sector--education, medical care, business, agriculture, energy, and
    government, to name a few--is long and growing. We have made
    substantial progress in Afghanistan as well. The recent Constitutional
    Loya Jirga is an encouraging example of democracy in action. In both
    countries, as in the Horn of Africa and other areas, U.S. and coalition
    personnel work together to capture or kill terrorists, while at the
    same time improving infrastructure and economic conditions so that
    peace and freedom can take hold.
        Despite the operational demands on our forces, we remain ready to
    support the President's National Security Strategy to assure our
    allies, while we dissuade, deter and defeat any adversary. The draft
    National Military Strategy (NMS), developed in consultation with the
    service chiefs and combatant commanders describes the ways we will
    conduct military operations to protect the United States against
    external attack and aggression, and how we will prevent conflict and
    surprise attack and prevail against adversaries. The strategy requires
    that we possess the forces to defend the U.S. homeland and deter
    forward in four critical regions. If required, we will swiftly defeat
    the efforts of two adversaries in an overlapping timeframe, while
    having the ability to ``win decisively'' in one theater. In addition,
    because we live in a world marked by uncertainty, our forces must also
    be prepared to conduct a limited number of lesser contingencies while
    maintaining sufficient force generation capabilities as a hedge against
    future challenges.
        We appreciate your continued support giving our dedicated personnel
    the warfighting systems and quality of life they deserve. Our challenge
    for the coming year and beyond is to stay the course in the war on
    terrorism as we continue to transform our Armed Forces to conduct
    future joint operations. We cannot afford to let our recent successes
    cause us to lose focus or lull us into satisfaction with our current
    capabilities. The war is not over, and there is still dangerous work to
    do. To meet this challenge, we continue to focus on three priorities:
    winning the war on terrorism, enhancing joint warfighting, and
    transforming for the future.
                                war on terrorism
        Twenty-eight months after the terrorist attacks on September 11,
    defeating global terrorism remains our military's number one priority.
    We will continue to fight this war on many different fronts, because
    terrorism comes in many different forms. The stakes remain high, but
    our resolve remains firm.
        The more experience we gain in this fight, the more we recognize
    that success is dependent on a well-integrated military, interagency
    and coalition effort. This means the coordinated commitment of the
    military, diplomatic, informational, economic, financial, law
    enforcement, and intelligence resources of our Nation--all instruments
    of our national power. On the international level, coalition military
    and interagency cooperation has been remarkable. In Iraq, coalition
    forces from 34 nations are working hard to bring peace and stability to
    a country brutalized for 3 decades. In Afghanistan, 37 nations are
    working to secure a democratic government and defeat al Qaeda and
    remnants of the Taliban regime, with NATO assuming an increasing role
    in stability and reconstruction efforts.
        We have made significant strides coordinating U.S. Government
    efforts within the interagency and with our coalition partners. One of
    the ways we have been successful at coordinating interagency efforts is
    through venues such as the Strategy Working Group, the Senior
    Leadership Review Board and the Regional Combating Terrorism
    Strategies. Continued success in this war will depend largely on our
    ability to organize for a sustained effort and coordinate seamlessly
    among all government agencies. An even more demanding task is
    coordinating the efforts of our coalition partners, now numbering more
    than 90 nations. Coalition contributions have been significant, ranging
    from combat forces, to intelligence, logistics, and medical units. They
    have complemented our existing capabilities and eased the requirement
    for current U.S. forces in Iraq and Afghanistan. Coordinating the
    efforts of our coalition partners is critical to combating the
    remaining terrorist threat.
        The al Qaeda network, though damaged, remains resilient, adaptable
    and capable of planning and executing more terrorist acts, such as the
    attacks in Saudi Arabia and Turkey toward the end of 2003. Al Qaeda
    continues to receive support and recruit operatives from sympathizers
    around the world. Al Qaeda will increasingly focus on Iraq as today's
    jihad. As the network consolidates its efforts in Iraq, the threats of
    attacks will grow. In fact, four al Qaeda audiotapes released in 2003
    prominently mentioned Iraq, demonstrating Osama bin Laden's emphasis on
    staging attacks there. Ansar al-Islam also remains a formidable threat
    in Iraq, despite damage inflicted by coalition forces during Operation
    Iraqi Freedom (OIF). Its key leadership remains at large and continues
    to plot attacks against U.S. and coalition interests.
        Other terrorist groups also pose significant threats to U.S.
    interests, and we believe that some of these terrorist groups have
    developed contingency plans for terrorist attacks against U.S.
    interests abroad. The Revolutionary Armed Forces of Colombia continue
    to conduct terrorist attacks throughout Colombia. They currently hold
    three U.S. hostages captured in early 2003, and directly threaten
    efforts to bring peace, stability and an end to the drug trade in
    Colombia. Jemaah Islamiyah in Southeast Asia is another terrorist group
    that shares al Qaeda's goals and methods, adding to the transnational
    terrorist threat. The intelligence that led to recent heightened alert
    levels in the U.S. show that the threat of a major terrorist attack
    against the U.S. homeland remains very real.
        Disturbingly, terrorist groups continue to show interest in
    developing and using chemical, biological, radiological, and nuclear
    (CBRN) weapons in terrorist attacks. Terrorists have attempted to
    acquire military-grade materials, and interest in CBRN weapons and
    materials by several groups is well documented.
        The coalition's efforts in the war on terror represent the
    significant first step in curtailing WMD proliferation. Our strategy
    for combating WMD calls for the combatant commanders to detect, deter,
    deny, counter, and if necessary, interdict WMD and its means of
    delivery. Combating WMD relies on a continuum of interrelated
    activities, employing both defensive and offensive measures, and
    confronting the threat through mutually reinforcing approaches of
    nonproliferation, counterproliferation, and consequence management.
    This multi-tiered and integrated effort will greatly reduce the threat
    of WMD falling into the hands of terrorists. Following the liberation
    of Iraq and the collapse of Saddam Hussein's brutal regime, the
    countries of Iran, and most recently, Libya have been more forthcoming
    about their illegal WMD programs to the international community. This
    should also help to apply international pressure on North Korea and its
    nuclear declarations.
        To counter the potential threat of the proliferation of WMD, the
    President's Proliferation Security Initiative (PSI) is the most far-
    reaching attempt to expand our efforts to impede and interdict the flow
    of weapons of mass destruction, their means of delivery, and related
    materials, between state and non-state actors of proliferation concern.
    It is part of a larger effort to counter proliferation of weapons of
    mass destruction and missile-related technology by interdicting
    shipments of these materials by air, land, and sea. To date, there are
    11 partner nations actively participating in PSI operations and
    exercises. Our goal is to expand PSI participation in order to be
    postured to respond quickly to assist in the interdiction of the
    proliferation trade.
                             oif and oef operations
        U.S. Central Command (CENTCOM) is still center-stage in the war on
    terrorism, and doing a magnificent job under difficult circumstances.
    Iraq is well on its way to becoming a sovereign country. Our coalition
    is strong, with 34 countries directly supporting stability and security
    in Iraq. As part of the 15 November 2003 agreement, the U.S., our
    coalition partners, and the Iraqi Governing Council are forging plans
    and agreements to allow for the transfer of sovereignty to Iraq this
    June. Since the end of major combat operations, we have made steady
    progress towards meeting our objectives. Essential services are being
    restored, and a political transformation is already underway in Iraq.
    Security in Iraq is steadily improving, and we are transitioning to a
    time when the face of security in Iraq is an Iraqi face, and coalition
    forces are in the background.
        Today, coalition forces continue to rout out remnants of the former
    regime attempting a desperate last stand. Using intelligence provided
    by Iraqi citizens, we are conducting thousands of raids and patrols per
    week alongside Iraqi security forces. We have seized massive amounts of
    ammunition, and captured or killed 45 of the 55 most wanted former
    Iraqi leaders, as well as thousands of other Saddam loyalists,
    terrorists and criminals. We have captured or killed all of the top
    five, most notably Saddam Hussein and his sons, Uday and Qusay.
        The Iraq Survey Group is continuing its examination of Saddam's WMD
    programs by interviewing Iraqi citizens, examining physical evidence,
    and analyzing records of the old regime. We know that this process will
    take time and patience, and must be able to stand up to world scrutiny.
        Our soldiers, sailors, airmen, marines, and guardsmen in Iraq are
    now supporting over 203,000 Iraqi security forces. The Iraqi police
    continue to expand their training pipelines in Jordan and Iraq,
    producing hundreds of trained officers each month. We are well on track
    to meet our goal of 71,000 Iraqi police by August 2004. The Facilities
    Protective Service has fewer training requirements and has already
    reached its goal of 50,000 members. They have taken over security from
    coalition forces at most fixed site locations, such as power lines and
    parts of the oil infrastructure--key targets for sabotage. Our goal for
    the Border Enforcement Force is to have 25,700 members by December
    2004. They will relieve coalition forces guarding checkpoints along
    Iraq's border. U.S. military forces continue to vet former members of
    the Iraqi military and other security services for employment in the
    new Iraqi security services, but Iraqis are formally in charge of de-
    Baathification efforts and have established guidelines for that
    process. The Emergency Supplemental Appropriations Act for Defense and
    for the Reconstruction of Iraq and Afghanistan 2004 that Congress
    approved last year was instrumental in enabling our planned accelerated
    development of these security forces, and we are grateful for that
    support.
        The New Iraqi Army continues to train additional battalions. Iraq's
    Army needs more than just military skills. They must have a deep-rooted
    sense of professionalism, focused on protecting all Iraqis while
    operating firmly under civilian control. The new army will reflect
    Iraq's religious, regional, and ethnic mix, will be apolitical, and
    indoctrinated in their role of defense and security. We will spend the
    time and resources necessary to ensure the Iraqi Army is a well-trained
    and highly capable force.
        The linchpin of our security efforts during this transition period
    is the Iraqi Civil Defense Corps (ICDC), which is currently planned for
    a force of 40,000 by the summer of 2004. The ICDC is a light military
    force, created to deal with the current stability issues in Iraq. As we
    have done from the beginning, we continue to reassess the security
    environment in Iraq. These security assessments could change force
    goals for the various components of Iraqi security forces. With the
    resources allocated from the supplemental, we have made great headway
    in providing them with vehicles, uniforms and other gear, including
    communications systems that will enable them to succeed in their
    critical tasks. Military commanders in Iraq tell me that the Iraqi
    Civil Defense Corps has been highly effective, and as such, we
    increased the goal from 18 to 36 Battalions and provided $124 million
    extra funding to reinforce the success of this Iraqi Security Force.
        These supplemental funds also provided commanders with one of the
    most successful tools in winning the hearts and minds of the Iraqi and
    Afghan people, the Commander's Emergency Response Program (CERP). These
    funds provide commanders and the resourceful young troops they lead
    with the means to respond to urgent humanitarian and stabilization and
    reconstruction needs such as water and sanitation projects, irrigation
    and small-scale agriculture assistance, school house repairs, and civic
    cleanup projects. This program is an invaluable tool for establishing
    relationships with the Iraqi and Afghan people, assisting in economic
    development, and creating a safer environment.
        The United Nations and the international community are also playing
    vital roles in the political and economic transformation of Iraq. Over
    70 countries and international organizations including the U.S.,
    pledged $33 billion at the Madrid Donors Conference. U.N. Security
    Council Resolution 1511 called upon Iraqis, initially through the Iraqi
    Governing Council, to determine the course and speed of their political
    reformation. In response, the Iraqi Governing Council has submitted its
    plan and timetable for selecting a transitional National Assembly and
    interim government, drafting a constitution and holding elections. It
    is an ambitious schedule, but one that they can accomplish with our
    help.
        In addition to security and political progress, we continue to help
    Iraq rebuild the infrastructure required for economic progress and a
    stable democracy. The Coalition Provisional Authority (CPA) and Task
    Force Restore Iraqi Electricity are managing a comprehensive
    maintenance and upgrade program designed to improve power generation,
    transmission, efficiency and capacity to meet the future needs of the
    Iraqi people. Through the coordinated efforts of the Army Corps of
    Engineers and the Iraqi Ministry of Electricity, we met the initial
    October 2003 goal of 4,400 mega-watts (MW) of peak power generation.
    The next goal is 6,000 MW of power by 1 June 2004. In order to meet
    this goal the CPA developed the Power Increase Plan to offset recent
    system failures from severe weather and continuing sabotage and
    looting. This plan increases electrical power generation through an
    increase of generator rehabilitation and maintenance projects, the
    increase of new power generators to the national power grid, increasing
    electrical power imports from other nations, and improving system-wide
    power transmission and distribution. Other progress continues
    throughout Iraq in potable drinking water projects, supplying hospitals
    with medical supplies, providing school supplies for Iraqi school
    children and rebuilding classrooms. Living conditions are improving
    everyday in Iraq, as many of you have seen for yourselves on recent
    trips to Iraq.
        In Afghanistan, our military strategy combines both combat and
    stability operations. U.S. and coalition forces are conducting combat
    operations to rid Afghanistan of al Qaeda and Taliban remnants, and
    stability operations to assist in building Afghan security
    institutions, governing bodies, and economic prosperity. A few weeks
    ago the interim Afghan government held their first Constitutional Loya
    Jirga, approving a new constitution for Afghanistan.
        Security and stability operations are being conducted by 11
    Provincial Reconstruction Teams (PRTs) operating throughout
    Afghanistan, with 1 more PRT planned for this year. PRT representatives
    are making great strides improving the quality of life for the Afghan
    people by building schools, clinics, wells, roads, and other community
    infrastructure projects. Reopening the Kabul-to-Kandahar road was a
    major success. Our efforts have increased security and stability in
    Afghanistan.
        In August 2003, NATO assumed responsibility for the International
    Security Assistance Force (ISAF) in Afghanistan. In October 2003 the
    United Nations Security Council passed a resolution extending ISAF's
    mission in Afghanistan for 1 year, and authorizing ISAF to operate
    outside Kabul and its environs. In February 2004, a Canadian officer
    will assume command of the NATO ISAF headquarters from the German
    commander. NATO's role in Afghanistan is expanding. The first phase of
    NATO expansion included transfer of responsibility for the U.S. PRT at
    Konduz to NATO, with Germany as lead nation, and temporary NATO
    deployments outside Kabul. NATO is planning future ISAF expansion
    throughout Afghanistan.
        The Afghan National Army (ANA), now numbering 5,785 trained
    personnel, is at the forefront of efforts to improve security and
    stability and establish a strong national identity among the Afghan
    people. They are well on their way to reaching the annual throughput
    goal of 10,800 personnel by June 2004. To date the ANA has performed
    well, fighting side-by-side with U.S. and coalition forces during
    recent successful combat operations to capture or kill Taliban, Hezb-I-
    Islami-Gulbiddin, and al Qaeda elements. Most of the funding provided
    in the Afghanistan portion of the Fiscal Year 2004 Emergency
    Supplemental is being targeted to efforts that strengthen the ANA, such
    as new infrastructure and equipment that will also improve recruitment
    and retention efforts. These efforts include increased pay, plans to
    field 15 new regional recruiting centers by this spring, and
    establishing military benefit packages.
        Congress has demonstrated its commitment to the future of
    Afghanistan, but there is still much more the international community
    could and should contribute to the reconstruction of Afghanistan. The
    Afghan government, with the help of the U.S. Government, is seeking
    more donations for several infrastructure projects such as a new
    Ministry of Defense headquarters, a hospital in Kabul, and a military
    academy, as well as donations of certain equipment, weapons and
    ammunition.
        In neighboring Pakistan, working closely with President Musharraf,
    we have been able to increase coordination among U.S., Coalition,
    Afghan, and Pakistani Forces along the Pakistan-Afghanistan border. The
    Pakistani government has taken some initiatives to increase their
    military presence on the border, such as manned outposts, regular
    patrols and security barriers, including areas of the Pakistan
    federally Administered Tribal Areas, an area historically avoided by
    Pakistan's military forces. The Tripartite Commission consisting of
    U.S., Afghan, and Pakistan representatives concluded its fifth session
    in December, and among its accomplishments was the establishment of a
    subcommittee to investigate means to prevent cross-border conflict.
    U.S./Pakistani military cooperation continues to improve, and we are
    helping Pakistan identify equipment requirements for their
    counterterrorism efforts.
        Operations in the Horn of Africa remain an essential part of the
    war on terrorism. The Joint Task Force Horn of Africa at Camp Lemonier,
    Djibouti is conducting counterterrorist and civil affairs operations in
    Eastern Africa. Although these operations have impacted al Qaeda's
    influence in the region, a continued military presence is essential to
    stop the movement of transnational terrorists and demonstrating to the
    region our resolve to wage the war on terrorism in Africa.
        In support of Operation Enduring Freedom (OEF)--Philippines, U.S.
    Pacific Command (PACOM) used congressionally-approved funds this past
    year to continue counter-terrorism training for the Armed Forces of the
    Philippines. A small contingent of U.S. military personnel remains in
    the southern Philippines managing these efforts and other humanitarian
    assistance projects.
                           other overseas operations
        U.S. European Command (EUCOM), in accordance with Secretary of
    Defense (SECDEF) guidance, has developed a concept for the reduction of
    U.S. forces supporting U.S. Kosovo Force in the Province of Kosovo, and
    U.S. Stability Forces in Bosnia-Herzegovina. Implementation of this
    plan is dependent on the North Atlantic Council's Periodic Mission
    Review recommendation for the Balkans.
        When EUCOM concludes the Georgia Train and Equip Program in May
    2004, they will meet their objective of improving Georgia's ability to
    confront transnational terrorism operating within Georgia. Training is
    being provided for two staffs, four battalions, and one mechanized/
    armor company team. To build on this success and momentum, EUCOM is
    reviewing a possible follow-on Georgia Capabilities Enhancement Program
    to sustain and improve the Georgian military's newly acquired
    capabilities, and demonstrate a continued U.S. commitment to the
    Georgian Armed Forces' development.
        Maritime Interdiction Operations took on a new global focus last
    year, beyond the historical CENTCOM and EUCOM missions, when the
    President approved Expanded Maritime Interception Operations to
    interdict terrorists and their resources globally. Expanded Maritime
    Interception Operations are now significant mission areas for every
    deployed battle group, especially along maritime transit lanes and
    choke points. Results from these maritime operations, such as in the
    Mediterranean Sea, have produced lower insurance premiums in the
    shipping industry, considerably less illegal immigration in countries
    such as Spain, Italy, and Greece, and a reduction in crime at sea.
    Maritime Interdiction Operations are a truly international effort.
    German and Spanish led multi-national naval forces patrol the CENTCOM
    area of responsibility, and this past year coalition naval forces have
    been responsible for boarding over 30 ships within EUCOM's area of
    responsibility.
        U.S. Southern Command (SOUTHCOM) continues to support
    counternarcotics trafficking and counterterrorism efforts in the
    Caribbean and Central and South America. They are assisting the
    Colombian military in its fight against designated terrorist
    organizations by providing military advice, training, and equipment
    with an emphasis on the pursuit of narcoterrorist leadership,
    counternarcotics tactics, and security for major infrastructure such as
    the Cano Limon pipeline. SOUTHCOM supported the formation of the
    Colombian Army Special Operations Command and is continuing its efforts
    to train the Commando Battalion, and a Ranger-type unit. Training was
    successfully completed for the first Colombian Commando Battalion, and
    training has begun for the second battalion. The Colombian military has
    been very successful over the past year in their fight against
    narcoterrorism. The Tri-Border Area between Argentina, Brazil, and
    Paraguay is another focal point for drug and arms trafficking, money
    laundering, document fraud and Islamic terrorist-supported activities
    in South America. U.S.-sponsored multilateral exercises are promoting
    security, improving effective border control, and denying terrorist
    groups such as Hizballah, Hamas, and other Middle Eastern terrorist
    safe havens, restricting their ability to operate.
        SOUTHCOM is also providing nearly 2000 military personnel to manage
    detainee operations at Guantanamo Bay, Cuba. We operate in close
    coordination with several U.S. agencies. We are constantly reviewing
    the status of each detainee, and to date have transferred 87 of the
    detainees who were determined to be of no intelligence or law
    enforcement value, or no threat to the U.S. or its interests, back to
    their countries of origin for release. Four detainees have been
    transferred back to their country of origin, under an agreement for
    continued detention by that country. More await similar agreements to
    allow for transfer or continued detention. A number of detainees have
    been assessed as high intelligence and or law enforcement value, or
    pose a significant threat to U.S. interests. These detainees will
    remain for further exploitation. Other cases are being considered for
    referral to the Military Commission, although no one has been referred
    to date. Information gleaned from detainees, many of whom continue to
    make threats against Americans, has already helped prevent further
    terrorist attacks against the U.S. and our allies. Furthermore,
    continued detention of those who pose a threat to U.S. interests
    prevents those enemy combatants from returning to the battlefield.
        In accordance with the Unified Command Plan 2002 Change 2
    implemented last year on 1 January 2004, U.S. Strategic Command
    (STRATCOM) reported significant progress in all of their new mission
    areas: global strike; missile defense; DOD information operations; and
    command, control, communications, computers, intelligence,
    surveillance, and reconnaissance missions. Further, they are on
    schedule to achieve full operational capability in each of the newly
    assigned mission areas this year. The Secretary of Defense (SECDEF) has
    already approved the Information Operations Roadmap, which has 57 wide-
    ranging recommendations that aid combatant commanders in planning and
    executing fully integrated information operations.
        As we become more reliant upon information to conduct operations,
    the defense of our network is paramount. This requires properly trained
    people, common operating standards, and a well-stocked arsenal of
    information assurance tools. We are working diligently to centralize
    network operations and defense, and to formalize information sharing
    policy, guidance, and procedures. These steps, along with our
    cryptographic modernization plan, will safeguard our vital information.
        We are formalizing the role of U.S. Special Operations Command
    (SOCOM) in the war on terrorism. In the near future, we will be
    recommending a change to the Unified Command Plan assigning SOCOM
    specific responsibility to coordinate DOD actions against terrorist
    networks. We are also drafting planning guidance that will designate
    SOCOM as the supported commander for planning and, when directed,
    executing operations against terrorist networks. These changes will
    provide SOCOM and all of DOD improved focus in our global effort to
    combat terrorism.
                      current homeland defense operations
        Last year, U.S. Northern Command (NORTHCOM) reached full
    operational capability in their mission to deter, prevent and defeat
    threats and aggression aimed at the U.S. and its territories. Upon
    SECDEF approval, NORTHCOM can now deploy Quick Response Forces
    (company-sized units) and Rapid Response Forces (battalion-sized
    forces) to support time-sensitive missions such as defense of critical
    infrastructures or consequence management in support of the Department
    of Homeland Security (DHS). To improve interagency collaboration, DOD
    has been working with DHS to develop and implement the National
    Response Plan, a national-level, all-hazards plan that will integrate
    the current family of Federal Domestic Emergency Response Plans into a
    single plan.
        The Joint Staff has developed a contingency plan (CONPLAN) for
    consequence management operations, and NORTHCOM and PACOM have
    developed supporting plans. NORTHCOM's Joint Task Force Civil Support
    maintains strong interagency relationships to integrate command and
    control of DOD forces with Federal agencies to manage the mitigation of
    chemical, biological, radiological, nuclear, and explosive (CBRNE)
    incidents. This past summer, DOD, Nevada National Guard and Reserve
    units, Federal Emergency Management Agency (FEMA), 27 other Federal
    agencies, and Nevada State and local agencies participated in a
    consequence management exercise in Nevada called Determined Promise
    2003. I was thoroughly impressed by the coordination and cooperation
    among active and Reserve component forces, Federal, State, and local
    authorities. We are conducting similar exercises across the country.
        In regards to antiterrorism and force protection measures, the
    Joint Staff is working to ensure that combatant commanders at home and
    abroad have the resources to mitigate threats and respond to emergent
    requirements through the Combating Terrorism Readiness Initiatives
    Fund. My staff is involved in developing and updating antiterrorism
    standards and policies to reflect current worldwide operations and
    lessons learned so that we can address any vulnerabilities. We
    coordinate with various agencies in the areas of training, planning,
    operations and intelligence sharing, all essential for developing sound
    antiterrorism policies.
        In an effort to improve the security of U.S. military installations
    and personnel around the world, the Joint Staff has created the
    Antiterrorism Enterprise Portal, an evolving web-based portal that
    aggregates the resources and programs required to support the DOD
    Antiterrorism Program. This portal is fast becoming DOD's one-stop
    location for antiterrorism/force protection information.
        A program that complements this portal capability is the Joint
    Protection Enterprise Network (JPEN). Operated by NORTHCOM, this
    network provides the means to share unclassified force protection
    information rapidly between military installations in the continental
    United States, increasing their situational awareness and security
    significantly. Although currently operating only on military
    installations, JPEN has the potential to be expanded to share terrorist
    information with Federal, State, and local agencies as well.
        The war on terrorism requires collecting relevant data and turning
    it into knowledge that will enable us to detect and preempt the plans
    of an elusive, skilled enemy dispersed across the globe. Although many
    obstacles remain, we are making significant progress in the area of
    information sharing. The Joint Intelligence Task Force for Combating
    Terrorism (JITF-CT) at DIA is a prime example of effective intelligence
    cooperation in the war on terrorism. In the area of counterterrorism,
    we are making significant progress toward transparency and full
    information sharing. JITF-CT has experts from 12 intelligence and law
    enforcement organizations, and JITF-CT personnel are embedded in 15
    other organizations, including some forward deployed personnel.
                        readiness for future operations
        Our Nation's number one military asset remains the brave men and
    women serving in our Armed Forces. This past year, they demonstrated to
    the world their dedication, perseverance, and compassion as they
    liberated the Iraqi people and worked to bring peace and prosperity to
    the region. The administration, Congress, and DOD have made raising
    their standards of living a top priority. The 2004 budget provided an
    average military pay raise of 4.15 percent and targeted increases of up
    to 6.5 percent for some enlisted personnel. The 2005 budget's proposed
    reduction of out-of-pocket housing expenses from 3.5 percent to 0 is a
    sound investment, as are future pay increases based on the Employment
    Cost Index plus .5 percent.
        DOD has a focus group that continues to look at programs to enhance
    the combat effectiveness and morale of service and family members
    associated with OIF and OEF. Areas where we have made significant
    progress are Rest and Recuperation Leave, danger area benefits to
    include incentive options for extended tours of duty in Iraq and
    Afghanistan, exchanges, childcare and communications initiatives.
        All Services generally met or exceeded active duty and Reserve
    component recruiting and retention goals in both fiscal years 2002 and
    2003 and entered fiscal year 2004 with healthy Delayed Entry Program
    levels. However, recruiting and retention of both active and Reserve
    personnel will continue to require attention and continued investment
    as we face the challenges of an improving economy and the high
    operations tempo associated with the war. I view all of the quality-of-
    life issues as inseparable from overall combat readiness, and we
    greatly appreciate congressional support for all of these initiatives.
        The overall readiness of our Armed Forces--whether forward
    deployed, operating in support of contingency operations, or employed
    in homeland defense--remains good. Our forces are the world's best
    trained and, possess the requisite personnel, equipment, and resources
    necessary to accomplish the military objectives outlined in the
    Strategic Planning Guidance. Challenges do exist, especially with
    regard to ground forces in Iraq. We are currently in the midst of
    rotating our combat troops in Iraq--a feat that will rival any in
    history. We will continue to examine force levels and size them
    appropriately as security dictates.
        We continue to rely heavily on our Reserve and Guard personnel, who
    are playing critical roles in homeland defense, and serving with
    distinction around the world in the war on terrorism. Some missions
    like the ones in Bosnia-Herzegovina and Kosovo are almost exclusively
    made up of Reserve and Guard units, and they are doing a magnificent
    job. We are well aware of the strains on members, their families, and
    their employers, and continuously seek better ways to support them.
        There are several initiatives underway, collectively by DOD, the
    Services, combatant commands, and the Joint Staff to reform the
    mobilization process and to relieve the stress on the force. United
    States Joint Forces Command (USJFCOM), in conjunction with the
    Services, is leading the mobilization reform effort by evaluating
    policy changes and identifying other solutions to streamline the
    mobilization/demobilization process, and preliminary recommendations
    are expected in early 2004. Two Operational Availability sub-studies
    were conducted last year and identified the active component/Reserve
    component mix and low density/high demand assets as two areas of
    immediate concern to relieve stress on the Reserve component forces. As
    an example, the Army has already begun converting some Reserve
    component artillery forces into Military Police forces to meet one of
    the expected high demand roles of the foreseeable future. This, and
    other ongoing rebalancing efforts will ensure that Active and Reserve
    Forces continue to complement each other. The Services are actively
    engaged in reviewing how much of a given capability they need for this
    new security environment, and which capabilities belong in each
    component. Other key DOD areas of concern are reducing the need for
    involuntary mobilization of the Reserve component early on in rapid
    response operations, establishing a more rigorous process for reviewing
    joint force requirements, and ensuring efficient use of mobilized
    Reserve component personnel. A comprehensive Rebalancing the Force
    Report by Assistant Secretary of Defense (Reserve Affairs (ASD(RA))
    will summarize these efforts, while a study by Assistant Secretary of
    Defense (Health Affairs (ASD(HD)) will define Reserve component
    requirements for homeland defense.
        U.S. Armed Forces are capable of achieving all assigned objectives
    in the defense strategy. However, current stresses on the force remain
    considerable. The increased demands of the war on terrorism, sustaining
    post-conflict operations in Iraq and Afghanistan, and other global
    commitments are unlikely to change significantly in the near-term.
    Moreover, while committed globally, our Armed Forces must continue to
    defend the homeland, reconstitute forces returning from contingency
    operations, transform to meet future challenges, strengthen joint and
    combined warfighting capabilities, and maintain readiness. Today, given
    these commitments and requirements, we are carefully managing the risk
    in executing an additional major combat operation.
        When units return home from combat operations, they must undergo a
    reconstitution process, which generally means a drop in their
    readiness. However, this does not necessarily indicate that a unit is
    either unavailable for or incapable of executing part or all of their
    assigned wartime missions. We have initiated new measures in the
    current readiness reporting system to identify Service and combatant
    command requirements, determine the scope of required reset actions,
    and develop appropriate solutions to mitigate shortfalls and manage
    risk. Our workload remains high, but we remain prepared to accomplish
    those missions assigned to us.
        Army units returning from OIF I/OEF require focused maintenance
    efforts to return them to pre-hostility readiness levels, while
    continuing to meet combatant commanders' maintenance requirements. The
    Army's goal is to return OIF I/OEF active duty units to pre-deployment
    readiness within 6 months and Reserves within 1 year after return to
    home station. However, some critical aviation systems may require
    additional time in order to complete depot level repairs. Funding was
    programmed from the 2004 supplemental for these organizational and
    depot level maintenance requirements. Army Materiel Command is the lead
    agency for developing a plan to repair major equipment items from OIF
    I/OEF. Approximately 1,000 aviation systems, 124,400 communications and
    electronics systems, 5,700 combat/tracked vehicles, 45,700 wheeled
    vehicles, 1,400 missile systems, 6 patriot battalions, and 232,200
    various other systems are included in this repair plan. As OIF II and
    beyond maintenance requirements are further defined, DOD will refine
    estimates and update costs.
        Combatant commanders and the Services identified preferred
    munitions as one of their risk areas of concern via periodic readiness
    reporting. Supplemental funding, as well as augmented annual budget
    requests, have allowed us to meet our requirement for Joint Direct
    Attack Munitions and laser-guided bomb kit demands. In the near-term,
    we are focused on improving how we determine our munitions
    requirements. Over the long-term, we plan to field improved guided
    munitions systems that build on our already superb precision-delivery
    capabilities.
        Our military training areas are facing competition from population
    growth, environmental laws, and civilian demands for land, sea, and
    airspace. The Services are proud of their success in protecting the
    environment, endangered species and cultural resources. We are grateful
    to Congress for their assistance in the Fiscal Year 2004 Defense
    Authorization Act, which precluded designating certain DOD lands as
    critical habitat, and preserved valuable Navy training while ensuring
    protection of marine mammal species. Having the world's most
    sophisticated weapons systems and simulators cannot substitute for our
    most important military training activities, air, land, and sea
    maneuver and live-fire training. Some installations, ranges, and
    training areas are losing critical military value because encroachment
    is impairing their capability to provide useful readiness and
    operational support. Such facilities should be reviewed during the next
    round of Base Realignment and Closure. We will continue to seek
    congressional support that balances environmental concerns and
    readiness.
        Our Nuclear Readiness continues to evolve. In December 2001, the
    Nuclear Posture Review established a New Triad composed of Offensive
    Strike capabilities (both nuclear and non-nuclear), Defenses (active
    and passive) and Responsive Infrastructure in order to respond to a
    wide range of contingencies. DOD is in the midst of a Strategic
    Capabilities Assessment to assess the progress in fielding the New
    Triad and determine the number and types of forces to meet the
    President's goal of 1,700 to 2,200 operationally deployed strategic
    nuclear warheads by 2012.
        We continue our efforts to ensure we can operate effectively in a
    CBRN environment, since our potential adversaries, both nation states
    and terrorists, seek to acquire and develop weapons of mass
    destruction, including biological warfare agents. Vaccinations
    represent an important countermeasure against biological threats and
    provide our military personnel with the best available protective
    measures. To date, approximately 695,000 military personnel have been
    vaccinated against anthrax and more than 520,000 military personnel
    have received smallpox vaccinations. The anthrax and smallpox
    vaccination programs are very successful, and it is imperative to
    develop effective countermeasures against other biological threats to
    protect our warfighters.
        While our warfighting team has always included contractors, their
    involvement is increasing. The Joint Staff is leading a joint group to
    develop overarching DOD policy for management of contractor personnel
    during contingency operations.
        We must also reexamine our ability to get to the fight. The
    Mobility Requirements Study 2005, completed in 2000, is the current
    baseline mobility requirements document. DOD is actively engaged in
    conducting a new full-scale mobility study that reflects our current
    defense strategy and incorporates lessons learned from OEF and OIF to
    further clarify strategic lift requirements. The goal is to complete a
    new Mobility Capabilities Study by June 2005, in time to influence
    preparation of Program Objective Memorandum-08 (POM-08).
        Sustaining our overseas presence, responding to complex
    emergencies, prosecuting the global war on terrorism, and conducting
    operations far from our shores are only possible if our ships and
    aircraft are able to make unencumbered use of the sea and air lines of
    communication. Our naval and air forces must be able to take advantage
    of the customary, established navigational rights that the Law of the
    Sea Convention codifies. We strongly support U.S. accession to the
    convention.
        Although C-17 production is not planned to terminate until fiscal
    year 2008, production of several C-17 long lead items is planned to
    close in fiscal year 2006. The Air Force and DOD are studying the
    benefits and risks (including financial and war fighting) of continuing
    or terminating the C-17 long lead items production line, and plan to
    complete this assessment in time to inform the fiscal year 2006 POM and
    the Enhanced Planning Process.
        Increasing costs, decreasing reliability and maintainability, and
    an increased need for air-refueling capability dictate modernization of
    the KC-135 fleet. Congress has authorized the Air Force to lease 20 and
    purchase 80 new Boeing 767 tanker aircraft. In early December 2003, DOD
    suspended negotiations with Boeing, pending the outcome of ongoing
    Inspector General investigations. Based on the results of that
    investigation, the Air Force will recommend a cost-effective strategy
    for acquiring a suitable replacement for the KC-135 fleet to meet joint
    warfighting requirements to support our National Security Strategy.
        The F-35 Joint Strike Fighter (JSF) will be a giant leap over
    existing attack/fighter capabilities. JSF is in the third year of an
    11-year development program, and we have seen some design challenges.
    The current design challenge for all three variants is weight, which
    impacts performance requirements, particularly for the Short Takeoff
    and Vertical Landing variant. Design teams are working diligently to
    solve this issue, and we have moved the first planned production
    procurement to the right 1 year, and added extra money to the
    development. The weight issue is within normal parameters of design
    fluctuation, and this issue will be worked out through the development
    and design process.
        Protection of our troops remains a top priority. Interceptor Body
    Armor (IBA) was in the initial fielding phase at the start of OIF. The
    Army has been aggressively managing this critical item, and accelerated
    fielding and production rates when CENTCOM identified the need due to
    the threat situation. The Army has been issuing the IBA directly for
    use in the combat theater of operations. IBA consists of an Outer
    Tactical Vest (OTV) and a set of Small Arms Protective Inserts (SAPI).
    As of 26 January, 93 percent of the troops and DOD civilians operating
    in Iraq had been outfitted with IBAs with SAPI. The OTV and SAPI assets
    needed to equip the remainder of the force are in theater being
    distributed. During the upcoming force rotation, all OIF II forces will
    be outfitted in Kuwait prior to entering Iraq. We will continue to work
    diligently to provide the best protective equipment for our servicemen
    and women and DOD civilians.
        The up armored version of the high mobility multi-purpose wheeled
    vehicle (HMMWV) has proven to be effective at protecting our soldiers
    against mines, improvised explosive devices (IED) and direct fire
    weapons. Currently there is a shortfall in Iraq and worldwide. To fill
    this shortfall, in the near term, the Joint Staff, the Services, and
    the combatant commanders are conducting an aggressive campaign to
    redistribute worldwide inventories of up armored HMMVVs to Iraq. In the
    longer-term, Congress' Emergency Supplemental provided funding to
    accelerate production of up armored HMMVVs to meet CENTCOM requirements
    by January 2005.
        OIF reaffirmed how critical the deployment and distribution process
    is to joint warfare. The Joint Staff is working with DOD and the
    Service logistics experts to develop an integrated end-to-end
    deployment and distribution process that is responsive to rapid
    projection of forces, the delivery and handoff of joint forces, and
    worldwide sustainment in support of the Joint Forces Commander.
        During the fiscal year 2004 budget cycle, Congress voiced concern
    over the Department's overseas basing plans. Since then, our global
    posture strategy has matured. We are now in the process of detailed
    consultation with our allies and Members of Congress. The overseas
    portion of the fiscal year 2005 military construction budget submission
    includes projects at enduring locations. These projects reflect our
    combatant commanders' most pressing base and infrastructure needs. I
    urge Congress to support our combatant commanders and fund the overseas
    military construction projects submitted in the fiscal year 2005 budget
    request. These projects contribute directly to our readiness and the
    quality of life our personnel deserve.
                               joint warfighting
        Protecting the U.S., preventing future conflicts, and prevailing
    against adversaries require our military to sustain and extend its
    qualitative advantage against a very diverse set of threats and
    adversary capabilities. Maintaining our qualitative advantage begins
    with improving education programs across the Services. We must also
    adapt and transform organizations and functions to eliminate gaps and
    seams within and between combatant commands, agencies at all levels of
    government, and potential coalition partners. Information sharing is at
    the forefront of this effort.
        Recent operations in Afghanistan, Iraq, the Philippines, and Africa
    have demonstrated the impact timely sharing of intelligence has on
    planning and executing military operations. Since this is a global war
    requiring an international effort, we must also improve coalition
    command and control capabilities, and consolidate the numerous networks
    that exist today. These disparate networks hinder our ability to plan
    in a collaborative environment and exercise timely and effective
    command and control with our multinational partners.
        We must also review policies and implement technology that
    safeguard our vital sensitive information while ensuring critical
    operational information is shared with all those who fight beside us.
    JFCOM has been tasked to take the lead in identifying specific
    multinational information sharing requirements and recommending policy
    changes. Our goal is to establish a multinational family of systems
    with common standards as part of the Global Information Grid enterprise
    services. I view this as a top priority and ask for congressional
    support--information sharing with our allies is critical to winning the
    war on terrorism.
        During OIF, our military forces benefited from unprecedented
    situational awareness through a common operational picture. In
    particular, one new system, Blue Force Tracker, was critical to the
    success of our forces as they sped towards Baghdad. Some of the 3rd
    Infantry Division, V Corps, and I Marine Expeditionary Force (MEF)
    vehicles were equipped with transponders that automatically reported
    their positions as they maneuvered across the battlefield--greatly
    improving situational awareness for our battlefield commanders, and
    reducing the potential for blue-on-blue engagements. Despite
    significant improvements in joint combat identification, challenges
    remain to reduce incidents of friendly fire, and maximize the synergy
    of combined arms to provide all front-line tactical units with friendly
    and threat information during decisive engagements. To address these
    challenges, JFCOM has the lead in the comprehensive effort to improve
    Joint Battle Management Command and Control, which includes the
    integration of Common Operational and Tactical Pictures, Combat
    Identification, and Situational Awareness across the force.
        We are taking command and control lessons learned from OIF like the
    capability to track Blue Forces, and running them through the Joint
    Capabilities Integration and Development System process to help shape
    future systems requirements. The objective is to ensure all of the
    critical considerations of Doctrine, Organization, Training, Material,
    Leadership and Education, Personnel, and Facilities (DOTMLPF) are
    employed in an approach that synchronizes material and non-material
    solutions.
        We are also improving our military war planning process. The Joint
    Staff has developed an adaptive planning process--whose key concepts
    are agility and speed--to reduce the time to develop and update war
    plans, while adding flexibility and adaptability to respond to the
    rapid changes in the global strategic security environment. The goal is
    to provide the President and SECDEF the best options possible. We have
    also been developing a collaborative campaign-planning tool for crisis
    action planning and execution. These tools should allow commanders the
    ability to assess multiple courses of action, rapidly compressing plan
    development time while increasing plan flexibility.
        Our warfighting effectiveness is also enhanced by our Joint
    Exercise Program, which provides combatant commanders with the means to
    train battle staffs and forces in joint and combined operations,
    evaluate their war plans, and execute security cooperation plans with
    our allies and coalition partners. In order to improve joint training
    opportunities, JFCOM has established a Joint National Training
    Capability (JNTC), which will achieve Initial Operational Capability in
    October 2004. JNTC will combine live and virtual play at multiple
    locations. The goal is to provide realistic joint combat training
    against an adaptive and credible opposing force, with common ground
    truths, and high quality exercise feedback.
        Strategic airlift is available to exercises only on an as-available
    basis, since it is prioritized for operational needs first. Providing
    the personnel and assets to accomplish meaningful joint training during
    this period of high operations tempo (OPTEMPO) has also been
    challenging. To balance these competing requirements, the combatant
    commanders are reviewing their fiscal year 2004 exercise programs with
    a view to canceling, downsizing, or postponing exercises. We must
    continue to balance operational and exercise requirements against
    operations/personnel tempo (OPS/PERSTEMPO) and available lift.
        Prior to combat operations in Iraq, we established a process for
    adapting OIF lessons learned for future operations as rapidly as
    possible. JFCOM has the lead role in turning identified operational
    level lessons learned into required capabilities through the Joint
    Capabilities Integration and Development System. A consolidated OIF
    After Action Review will be presented to Congress in July 2004. The top
    three OIF Strategic Lessons Learned, from the Joint Staff perspective,
    are the need for an improved deployment process (including Reserve
    component mobilization), redistributing specialties between the active
    and Reserve components, and improving the Phase IV planning and
    transition process.
        Phase IV transition and Stability Operations require significant
    adjustments in how we plan, train, organize, and equip our forces. We
    can expect future adversaries to attempt to offset U.S. military
    strengths through asymmetric means, to include terrorist insurgency, as
    combat operations transition to post conflict operations. The lessons
    learned process continues during stability operations in Afghanistan
    and Iraq.
        The Joint Staff, in coordination with the Services and the
    combatant commanders, is revising the National Military Strategy to
    link strategic guidance to operational warfighting and serve as a
    military plan to implement the National Defense Strategy and the
    National Security Strategy. The National Military Strategy provides the
    context for other military documents such as the Joint Operations
    Concept, Joint Strategic Capabilities Plan, and other plans. It will
    incorporate lessons learned from Operations Noble Eagle, Enduring
    Freedom, and Iraqi Freedom and establish specific military priorities,
    objectives, employment concepts, and capabilities for combatant
    commands and Services. The 2004 National Defense Authorization Act
    requires that the National Military Strategy include the Chairman,
    Joint Chiefs of Staff (CJCS) annual risk assessment, which is due 15
    February 2004.
          considerations and recommendations for goldwater-nichols act
        For the past 18 years, joint operations have been improving under
    the provisions of the Goldwater-Nichols Act. The act strengthened
    civilian control of the military and facilitated better military advice
    to the President, SECDEF, National Security Council (NSC) and Congress.
    Now, it is time to consider new ideas for improving the effectiveness
    and efficiency of the military instrument of power in today's new
    security environment.
        The war on terrorism and other recent military operations have
    demonstrated the need for improved interagency cooperation, integration
    and execution of National Security Council decisions. We also need to
    improve how we coordinate the efforts of international, regional and
    non-governmental organizations. I fully support initiatives to
    formalize a mechanism that creates effective lines of authority and
    provides adequate resources to execute interagency operations. For
    example, designating the Chairman of the Joint Chiefs of Staff as the
    principal military advisor to the Homeland Security Council would
    improve homeland defense and prosecution of the war on terrorism beyond
    our borders.
        Joint Officer Management codified in the 1986 Goldwater-Nichols
    legislation was based on the threats and force structure evident late
    in the Cold War. We are developing a strategic plan to shape joint
    officer management based on the type and quantity of officers needed to
    perform current and future joint missions, and the education, training,
    and experience joint officers require. This strategic approach will
    ensure future joint officers meet the needs of joint commanders.
        We are already taking some initiatives to improve our Joint
    Professional Military Education system, with the goal of educating and
    training the right person for the right task at the right time.
    Historically, we waited until officers became majors and lieutenant
    colonels before we provided them with joint education. We are finding
    that the war on terrorism requires noncommissioned officers and junior
    officers from all Services to work in the joint environment more often
    than they have before. We are developing courses tailored to the needs
    of our younger troops that expose them to joint warfighting far earlier
    in their careers. To improve joint officer management and education,
    and prepare officers for joint duty earlier in their professional
    careers, I request consideration to allow the Service War Colleges to
    teach Joint Professional Military Education (JPME) Phase Two and the
    authority to determine the appropriate length of the Joint Forces Staff
    College's JPME Phase II course. We also have pilot programs providing
    joint education to Senior Noncommissioned Officers and our Reserve and
    Guard component members. Additionally, we are reviewing our joint
    general and flag officer training programs to ensure our senior
    officers are prepared to command joint task forces and work effectively
    with interagency and coalition partners.
        Today, the chairman remains well positioned to assist in providing
    strategic direction to the Armed Forces, assess impacts on the long-
    term readiness of the force, and evaluate current and potential levels
    of risk associated with global military activities. Already, we are in
    the process of transforming our internal processes make them more
    responsive in the current dynamic environment. In a similar vein, I
    request we also reevaluate and streamline our current reporting
    requirements to Congress, many of which seem of questionable utility. I
    propose the formulation of a working group composed of members from the
    House Armed Services Committee (HASC), Senate Armed Services Committee
    (SASC), House Appropriations Committee (HAC), Senate Appropriations
    Committee (SAC), Office of the Secretary of Defense (OSD), Office of
    Management and Budget (OMB), and Joint Staff to identify the best means
    and frequency of communications to meet congressional oversight needs.
                    transformation of the u.s. armed forces
        We cannot focus solely on the threats we face today and assume
    there are not other, perhaps even more challenging threats on the
    horizon. Maintaining our unchallenged military superiority requires
    investment to ensure the current readiness of deployed forces while
    continuing to transform military capabilities for the future. Our
    adversaries will learn new lessons, adapt their capabilities, and seek
    to exploit perceived vulnerabilities. Therefore our military must
    transform, and must remain ready, even while we are engaged in war.
        Before the events of September 11, transforming the force was
    viewed as DOD's greatest near-term challenge. Since then, we have had
    to fight battles in the mountains of Afghanistan, in the cities of
    Iraq, and around the world for the security of America. Putting
    transformation on the back burner and focusing solely on the fight at
    hand is simply not an option. We are fighting a war unlike any we have
    fought before--it demands new ways of thinking about military force,
    new processes to improve strategic agility, and new technologies to
    take the fight to the enemy. DOD continues to invest heavily in
    transformation, both intellectually and materially. Given that
    transformation begins with innovative thought, we have developed a
    suite of concepts that will define how the joint commander will fight
    in 2015 and beyond.
        We recently published an overarching concept document titled Joint
    Operations Concepts to provide a framework for developing capabilities
    and defining concepts. Using this document as a foundation, the Joint
    Staff completed development of five joint functional concepts to define
    how joint warfighting will be conducted across the range of military
    operations. These functions include force application, protection,
    command and control, battlespace awareness, and logistics. Meanwhile,
    the combatant commands have been working on four high-level operating
    concepts that include strategic deterrence, stability operations,
    homeland defense, and major combat operations.
        Collectively, functional and operating concepts define how we want
    to fight in the future, and will help us transform from the threat-
    based force of the Cold War to a capabilities-based force postured to
    respond to a wide variety of threats, some of which we cannot
    confidently predict today. To aid the Joint Requirements Oversight
    Council in determining warfighting needs with a capabilities-based
    approach, we are developing joint integrating concepts. These concepts
    are far more focused than functional and operating concepts, and define
    specific tasks to be conducted. They are designed to bridge the gap
    between how we want to fight and the capabilities we need. Examples
    include urban operations, global strike operations, and forcible entry
    operations. The functional, operating, and integrating concepts will
    continue to evolve over time. The first round of this very important
    concept work should be done within the year.
        For each functional concept area we have established a Functional
    Capability Board to integrate the views of the combatant commands,
    Services, defense agencies, Joint Staff, and OSD. These boards comprise
    functional experts from across DOD who will provide the best advice
    possible for our planning, programming, and acquisition processes.
    Functional Capability Boards also support a new process called the
    Joint Capabilities Integration and Development System, which replaces
    the previous Cold War-era Requirements Generation System. The new
    system recognizes that less expensive programs can have a significant
    impact on joint operations. Virtually all programs are reviewed through
    the JROC process for potential joint impact before they get a green
    light, ensuring all Service future systems are born joint.
        Based on the recommendations of the Joint Defense Capabilities
    Study--the Aldridge Study--we established the Strategic Planning
    Council chaired by SECDEF, and composed of the Service Secretaries, the
    Joint Chiefs, principal under secretaries, and the combatant
    commanders. The first meeting was held 28 January 2004. To capture and
    disseminate this top-down strategic direction, we will produce a new
    Strategic Planning Guidance document as the mechanism to provide
    subordinates with this strategic guidance. The first Strategic Planning
    Guidance document should be complete by February 2004.
        We are also developing an Enhanced Planning Process that integrates
    DOD-wide lessons learned, experimentation, concept development, study
    results, capability gap analysis, and technology development into a
    collaborative capabilities planning function. The goal is to offer
    distinct and viable alternatives to senior leadership rather than a
    consensus driven, single point solution, and implement their decisions
    into the Joint Programming Guidance document, the first of which will
    be issued in May 2004.
        These three transformational process initiatives--Functional
    Capability Boards, Joint Capabilities Integration and Development
    System, and the Enhanced Planning Process--work together improving our
    planning and programming agility for future joint capabilities. JFCOM
    is working with the Functional Capability Boards to incorporate lessons
    learned from OEF and OIF into a list of materiel and non-materiel
    recommendations to the Joint Requirements Oversight Council to turn
    lessons learned into identified capabilities needs as quickly as
    possible.
        JFCOM is also coordinating with the Services, combatant commands,
    other U.S. agencies, and coalition partners to ensure experimentation
    efforts support the warfighter. One of JFCOM's key experimentation
    initiatives is the Standing Joint Force Headquarters, which will
    provide combatant commanders a rapidly deployable command and control
    team, along with supporting information systems and reachback
    capabilities, that will enable us to respond to regional conflicts with
    smaller and more effective joint operational headquarters. JFCOM is
    establishing the prototype Standing Joint Force Headquarters this year,
    and in fiscal year 2005 we will field the communications portion known
    as the Deployable Joint Command and Control System to CENTCOM and
    PACOM. EUCOM and SOUTHCOM receive follow on systems in fiscal year 2006
    and fiscal year 2007. The Deployable Joint Command and Control System
    will use state-of-the-art information technology to enhance Joint Force
    command and control.
        Communications systems are a prime target for transformational
    ideas. The Joint Tactical Radio System is a software programmable radio
    that will provide seamless, real-time, voice, data and video networked
    communications for joint forces. It will be scalable allowing
    additional capacity (bandwidth and channels) to be added, backwards-
    compatible to communicate with legacy systems, able to communicate with
    multiple networks, and able to accommodate airborne, maritime and land
    based systems. It provides the tactical warfighter with netcentric
    capabilities and connectivity to the Global Information Grid, and is
    essential to meeting our 21st century joint communications warfighting
    requirements.
        Transformation also means developing multiple, persistent
    surveillance capabilities that will let us ``watch'' situations and
    targets by looking, smelling, feeling, and hearing with a variety of
    long-dwell sensors from space, air, ground, sea and underwater and
    integrating these capabilities into a ``system of systems.'' The
    exploitation of Measurement and Signature Intelligence (MASINT), holds
    great promise. MASINT collects information from many diverse sources to
    detect, characterize and track a target or activity by its distinctive
    properties, or ``signatures'' that are very difficult to conceal or
    suppress. Last year, DIA created its Directorate for MASINT and
    Technical Collection to develop new forms of technical collection and
    integrate MASINT into collection strategies and operations.
        Another example of the transformational technologies we have just
    fielded is the Army's Stryker Brigade, which is centered on a new,
    fast, and quiet vehicle that can deliver 11 troops to the fight. This
    effort is far more than simply fielding a new vehicle; it is also a new
    way to organize a brigade, and link that brigade to a networked command
    and control system that shares intelligence, surveillance, and
    reconnaissance information. Our Stryker Brigade Combat Teams (BCTs) are
    organized and trained to take advantage of this new technology. The
    first Stryker BCT is already proving its worth in Iraq.
        To reduce our vulnerability to weapons of mass destruction, we have
    made progress on providing missile defenses for our homeland, our
    deployed forces, and our friends and allies. In the coming year, we
    plan to deploy six ground-based interceptors in Alaska and four in
    California to provide an initial capability to defend the U.S. from
    ballistic missile attack. The Patriot missile defense system and the
    emerging AEGIS-based SM-3 system will provide short and medium range
    missile defenses, as well as critical surveillance and tracking
    essential to our Ballistic Missile Defense System. Coupled with an
    upgraded launch detection capability provided by the Space-Based
    Infrared System, our ballistic missile defenses will continue to
    improve significantly over the next few years.
        The Global Positioning System (GPS) offers an excellent example of
    a system that transformed modern warfare. GPS delivers worldwide
    positioning, navigation and timing data that provide U.S. and allied
    forces an all-weather, precision engagement capability. Over the last
    decade, the success of combat operations was largely due to GPS-aided
    precision-guided munitions. We must continue to modernize GPS, improve
    capabilities, protect U.S. and allied access to reliable military
    positioning, navigation and timing information, and deny this
    information to our adversaries, while minimizing impacts to peaceful
    civil users. We are engaged with NATO and the European Union to resolve
    our concerns with the proposed Galileo system, a civil satellite system
    that puts at risk our programmed military enhancements to GPS. A U.S.
    interagency team has made significant headway with some tough technical
    issues over the past year, but continued negotiations are essential to
    address the remaining technical, and more importantly, the political
    issues. Once these issues are resolved, we can confidently move forward
    with our vision of space superiority to support future joint and
    coalition operations.
        As recent military operations have demonstrated, space is a
    critical dimension of the battlespace. Lessons learned from OEF and OIF
    highlight our increasing reliance on space communication assets and our
    demand for bandwidth. Our challenge is meeting future warfighter
    requirements in the face of an aging satellite constellation. Despite a
    planned 10-fold increase in capability through Advanced Extremely High
    Frequency (EHF) and Wideband Gapfiller Systems, projected capacity may
    not meet the growing demand. This shortfall will potentially impact our
    ability to maintain a technological advantage over our adversaries.
    Work on Transformational Satellite Communications continues, which is
    designed to improve communications for mobile systems, particularly
    those that provide intelligence, surveillance, and reconnaissance. Our
    unmanned aerial vehicles and the Army's Future Combat System place
    heavy demands on bandwidth, particularly when real-time video feeds are
    required. The frequency spectrum is critical not only to joint
    warfighting, but to all Federal, State, and local agencies to ensure
    national security and public safety. Military and civilian technology
    is rapidly moving to a wireless medium. As pressures from commercial
    sources to free up more Federal spectrum mount, we must ensure our
    long-term spectrum accessibility for our military forces.
        These are just a few examples of our ongoing transformation
    efforts. We are working hard to integrate old systems with new, in
    innovative ways. Interoperating between our own legacy and
    transformational systems is a challenge for us, but it is an even
    greater challenge to our coalition partners, who must participate in
    key decisions on how transformation will enhance combined operations in
    the future.
        Over the past year, NATO has achieved great success in progressing
    toward a transformed military organization. The alliance has developed,
    approved, and begun implementing a new, more streamlined command
    structure, which will make it viable in the 21st century global
    security environment. The catalyst for modernization will be the new
    Allied Command Transformation, which will maintain a close partnership
    with JFCOM. Also, on the forefront of transformation, NATO has created
    the NATO Response Force, a key enabler of NATO's new operational
    concept. It is designed to be a combined, deployable, sustainable, and
    lethal force intended to be NATO's first responders, able to respond
    quickly to a crisis anywhere in the world. In a display of NATO's new
    focus, on August 11, 2003, NATO assumed command of International
    Security Assistance Force (ISAF) in Afghanistan, the first out of area
    mission in the history of the Alliance. To be an effective joint force
    in the future, we must ensure that our allies keep pace with our
    transformation efforts.
                                   conclusion
        Responding to today's dynamic threat environment requires our Armed
    Forces to be innovative, agile, and flexible. With Congress' strong
    support, our military has made significant progress combating
    terrorism, improving our joint warfighting capabilities, and
    transforming our military into a 21st century fighting force. We
    appreciate your efforts to help us be responsive to a changing world,
    and make that world a safer and better place.

        Chairman Warner. Thank you very much, General.
        Members of the committee, we have a quorum present, and it
    is the desire of the chair and the ranking member to address to
    the committee promotions of three flag officers and general
    officers who are in combat commands today. I propose that we
    briefly go into executive session to consider and act upon
    several important nominations.
        [Whereupon, at 10:27 a.m., the hearing was recessed, the
    committee proceeded to other business in executive session,
    then reconvened the hearing at 10:29 a.m.]
        Chairman Warner. Colleagues, the Secretary will be
    addressing the House in the posture statement beginning at 1
    o'clock. We will therefore have to conclude our work by the
    hour of 12:00, so we will hold to 5-minute rounds for each
    member. I will proceed at this point in time.
        Mr. Secretary, I thought your comprehensive statement on
    transformation is one that this committee will try and support
    in every way. Do you know of any special legislation that you
    will further require for the implementation of this package?
    The legislative package is in the normal sequence of events to
    come to the committee here in a week or so, but perhaps you
    could tell us at this time. An example is the important
    institution of reform in the civil service that you proposed
    last year and which I think in large measure was adopted. Any
    other legislative proposals you could alert us to at this time?
        Secretary Rumsfeld. Mr. Chairman, there is nothing of the
    magnitude of the new national security personnel system that we
    will be proposing. But there will be a number of smaller items,
    lesser items, that we will be recommending for approval,
    consideration of the committee.
        Chairman Warner. Do you feel that the budget provides the
    needed dollars to implement the transformation that you have
    undertaken and continue to undertake?
        Secretary Rumsfeld. I do.
        Chairman Warner. That involves not only pay and benefits
    for the military, but also the acquisition of new equipment?
        Secretary Rumsfeld. I do.
        Chairman Warner. The plan of the United States Army under
    the direction of a very able Chief of Staff and a very able
    Acting Secretary requires sort of fracturing the existing force
    into another series of units. Are they going to be fully
    equipped?
        Secretary Rumsfeld. They will be. Pete Schoomaker and I
    briefed the President on the Army's proposal. The President
    approved it. General Schoomaker will be presenting it to this
    committee at a time of your choosing. It is important that it
    be considered carefully.
        It has multiple dimensions. Not only does he intend to go
    from 33 to 48 brigades over a period of 4 or 5 years--5?
        General Pace. Four years to 43, sir, and then an additional
    4 to the 48.
        Secretary Rumsfeld. So it is 4 years to the 43 brigades and
    then an additional period for the remaining 5 brigades, with an
    off ramp in the event they are not needed.
        But, in addition, he intends to more fully equip these
    brigades with division capabilities that currently are only at
    the division level and to make them more modular, so that they
    can be mixed and matched and deployed. There is no doubt in my
    mind but that if this plan is completed in the time frame
    indicated then we will have a much improved tooth-to-tail
    ratio.
        Chairman Warner. Thank you.
        Returning to the question of the WMD, the ISG, the military
    force augmented by a number of civilians from the Agency and
    other departments of the government, is one that is under the
    command of General Dayton, and now Mr. Duelfer will join. Is
    the funding adequate for them to continue and fulfil their
    mission? Because you and I both stressed that this mission must
    be completed.
        You described in your statement a number of, as you call
    it, ``theories'' of things that could have happened. Now, we
    wish to develop all the facts that we can possibly find to
    determine the answers to the various theories that you have
    represented.
        Secretary Rumsfeld. The ISG has somewhere between 1,200 and
    1,300 people currently assigned.
        Chairman Warner. That is correct.
        Secretary Rumsfeld. General Dayton is the individual who is
    responsible for those people. He had reported to Dr. Kay, and
    Dr. Kay had the responsibility for the judgment calls as to the
    pace at which people should be interviewed and interrogated,
    the pace at which various documentation should be translated,
    and all of those judgment things that are more appropriate to
    the CIA than the DOD.
        General Dayton has done a superb job of managing that task.
    There is a natural tension. You never have enough Arabic
    speakers or enough people to go over all the documentation that
    exists. They do not exist in our country or even through
    contractors. On the other hand, they have a good cadre of these
    folks. As you said, they come from all departments and
    agencies. It is fully budgeted for in this budget, and they are
    doing a terrific job under very difficult circumstances.
        The tension that exists is our people are not currently
    being killed by WMD; they are being killed by terrorists. The
    same individual that one might interrogate or the same document
    that one might translate could produce information, for
    example, on the location of Saddam Hussein; it could produce
    information on counterterrorism, and it could produce
    information on the location of WMD. You do not know that as you
    go through that process.
        So we are continuing to focus on WMD, but we are also
    focusing on counterterrorism.
        Chairman Warner. The mission basically remains the same?
        Secretary Rumsfeld. It does.
        Chairman Warner. The structure of leadership remains the
    same?
        Secretary Rumsfeld. It is identical.
        Chairman Warner. You will keep this committee informed if
    at any time you feel those resources of a significant amount
    have to be diverted away from that mission?
        Secretary Rumsfeld. Dr. Cambone, am I correct when I said
    that the mission has not been altered?
        Dr. Cambone. Yes, sir.
        Secretary Rumsfeld. It has not.
        Chairman Warner. Fine. Thank you very much.
        I was pleased that you directly answered my question with
    regard to the WMD. You also added your personal dimension to
    it, which is important because you have served under a number
    of presidents for a very long time in many challenging tasks,
    and you understand government service and the importance of
    being honest and forthright, as you are.
        General Pace, on the question of the transfer of
    sovereignty, you have looked at the various steps that have to
    be performed. One of them General Abizaid addressed, and in our
    preliminary discussions in preparation for this hearing you
    felt that he might have been misquoted with regard to the
    appropriate protections of the coalition forces and the ability
    of them to continue their work, not only the ISG, but the
    hunting down of the insurgents and the terrorists.
        Are you satisfied, one, that the schedule can be kept; and,
    two, that the basic military missions of the coalition forces
    can continue after June 30?
        General Pace. Sir, your Armed Forces right now are
    currently protected by the provisions of U.N. Resolution 1511,
    which gives us the protections of an agreement like the Status
    of Forces Agreement (SOFA) as we do what we do right now in
    Iraq. Our State Department, working with the U.N., working with
    the Iraqi Governing Council, knows exactly the kinds of
    protections that our Armed Forces will continue to need after
    the turnover of sovereignty, and they are working that.
        General Abizaid has had his input to that. We are watching
    that very carefully. We will ensure that our soldiers, sailors,
    airmen, marines, and coast guardsmen continue to have the
    requisite protection of their own individual rights as they do
    the mission that we have asked them to do.
        Chairman Warner. Lastly, Mr. Secretary, the forces under
    your supervision in the military are dependent on intelligence
    daily, I mean today, tomorrow, and in the future. While there
    are six and possibly seven investigations of the questions
    associated with WMD, we cannot wait until the final outcome to
    make some corrective measures. Are you personally looking at
    the DIA, the NSA, and other organizations, and contributing
    also your views to the greater Intelligence Community, about
    such corrections that have to be made today to see that the men
    and women of the Armed Forces and indeed others engaged in
    intelligence work that are on the front lines are receiving
    accurate, to the best we can, intelligence?
        Secretary Rumsfeld. Yes, sir. The things that are under way
    with respect to the DOD: number one, we are participating with
    the Director of Central Intelligence's (DCI), review of lessons
    learned that is led by Mr. Kerr. The DIA has its own lessons
    learned activity under way, as do the Services.
        In addition, we, needless to say, have been cooperating
    with the 9/11 Commission. We have been cooperating and will be
    cooperating with the commission to be appointed.
        I should add, however, that the intensive lessons learned
    activity that took place looking from the U.S. perspective
    after the Iraq war and also from the Iraqi perspective,
    interrogating Iraqi military people, has provided information
    as well with respect to intelligence. So there have been a
    whole series of things that the people have been proceeding on
    in an orderly way.
        Chairman Warner. Corrective measures are taken as you and
    others deem they are appropriate?
        Secretary Rumsfeld. Absolutely.
        Chairman Warner. In a timely way to protect our people?
        Secretary Rumsfeld. As the lessons are learned, they are
    implemented and have been. That process has been under way and
    ongoing.
        Chairman Warner. Thank you.
        Senator Levin.
        Senator Levin. Thank you, Mr. Chairman.
        There was an article about a week ago in the press that
    said that in two rounds of talks at the U.N. and Washington the
    United States told U.N. representatives that everything is on
    the table except the June 30 deadline for handing over power to
    a new Iraqi Government. Is that an accurate description of the
    President's position, that there will be no extension of that
    deadline regardless of the situation on the ground or
    regardless of whether or not that deadline has the support of
    the U.N.?
        Secretary Rumsfeld. First, let me come right back to that,
    but let me clarify some confusion. I have been reading things
    where critics and people have been saying that the Iraqi
    security situation is not sufficiently good that we could turn
    over sovereignty and then leave on June 30. There was never any
    intention to do that.
        Senator Levin. I just wonder, though, if you could answer
    my question----
        Secretary Rumsfeld. I will.
        Senator Levin.--because of the time problem.
        Secretary Rumsfeld. Okay.
        Senator Levin. Is that the position of the administration,
    that there will be no extension despite whatever happens on the
    ground and even if the U.N. does not support the turnover of
    sovereignty on that date?
        Secretary Rumsfeld. A decision on changing the date or
    changing whatever are really decisions for the President and
    not for me. These issues involving the governance pass-over are
    things that are basically in the hands of the President and the
    NSC, not the DOD.
        Senator Levin. Thank you.
        On the WMD issue, in September 2002, DIA produced a
    classified study called ``Iraq--Key WMD Facilities: An
    Operational Support Study.'' Part of that study has now been
    declassified. It included the following statement: ``There is
    no reliable information on whether Iraq is producing and
    stockpiling chemical weapons or where Iraq has or will
    establish its chemical warfare agent production facilities.''
    That is from a September DIA study, which was classified until
    recently.
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Now, on September 19, 2002, the same month of that
    classified DIA assessment, you publicly stated that Saddam has,
    ``amassed large clandestine stockpiles of chemical weapons''
    and ``we know he continues to hide biological and chemical
    weapons, moving them to different locations as often as every
    12 to 24 hours and placing them in residential neighborhoods.''
        How do you explain the contrast between the DIA-reported
    intelligence that said there was no reliable information about
    production or stockpiling of chemical weapons and your public
    statements that you knew that Saddam has such weapons? What
    explains the discrepancy there?
        Secretary Rumsfeld. First, let me say that, on your prior
    question, I would never say never on the deadline myself.
    Clearly the goal is to pass sovereignty as soon as possible,
    but what judgments the President might or might not make depend
    on the way the world evolves.
        Needless to say, I am sure I never saw that piece of
    intelligence and whether or not it was the DIA's view overall
    or an analyst's view I cannot tell from the way you have
    presented it. I have relied not on any one single intelligence
    entity, like the DIA or the CIA. I have relied on the
    Intelligence Community's assessments, and the Intelligence
    Community's assessments were what they were, and they were as I
    stated them.
        Senator Levin. Do you see a difference between saying with
    certainty that we know something and saying that there is some
    evidence of something?
        Secretary Rumsfeld. I do.
        Senator Levin. That was not the way in which the public
    statements of the administration were made. It was not that
    there is evidence or that there is belief. It was the
    statements of great certainty, that we know that there are
    amassed stockpiles of weapons, we know where they are.
    Everything was stated with certainty. What is not part of any
    of those investigations, those six that you have mentioned, is
    a review of the policymakers' certainty in their statements and
    what was the basis in intelligence for those statements of
    certainty.
        That is one of the issues here, as to whether or not those
    statements, made with certainty by many members of the
    administration, should be reviewed in terms of what the
    intelligence was that did or did not back up such certain
    statements. I am not asking the question. I just want to let
    you know that that is not being looked at by any of the
    investigations that you refer to. The investigation or inquiry
    that I am attempting to make at the Armed Services Committee
    with my staff is to look at that issue as well as all the other
    issues.
        But here is my question for you. It relates to the
    operation of Under Secretary of Defense for Policy Doug Feith.
    He made an analysis of the links between al Qaeda and Iraq and
    apparently presented a briefing to you on that analysis of the
    intelligence. Apparently the briefing that he made to you was
    then made to the DCI, the Intelligence Community staff, the
    NSC, and then to the Office of the Vice President.
        Was the Feith operation supposed to look at intelligence
    through a different prism from the rest of the Intelligence
    Community? Why was it formed other than for that? Why did it
    bypass the usual channels with the product of his analysis? It
    is kind of a two-part question.
        Secretary Rumsfeld. There was something that the press has
    characterized as an intelligence cell in the Office of Policy,
    Mr. Feith's office. It had two people in it at any given time.
    The people changed, and there may be two more. Maybe there were
    four or five at some point.
        All they did was to try to, as I understand it--and I
    talked to Mr. Feith about this. Their task was simply to read
    the intelligence, not to gather intelligence, but to read the
    intelligence that existed and to assist him in developing
    policy recommendations in his role as Under Secretary for
    Policy.
        At one moment, you are quite right, two people who had been
    looking at this thought they had an interesting approach to it.
    He asked me to be briefed. I sat there and listened to them. I
    said, ``Gee, that is interesting; why do you not brief the
    people at CIA?'' They did.
        Senator Levin. And the Vice President.
        Secretary Rumsfeld. I did not say that. I said exactly what
    I said. I asked them to brief the people at the CIA, and they
    did that. I do not know if they briefed anyone else besides
    that, but they did do what I asked.
        The implication that this two-person activity, or four or
    five over time, was gathering intelligence or doing something
    unusual is just not correct, as I understand it.
        Senator Levin. My question, though, was it intended that
    they look at intelligence through a different prism?
        Secretary Rumsfeld. No. As I understand it, just what I
    said. Their task was to take the intelligence that existed,
    look at it and see what they could figure out about it, just as
    I do when I read it and you do when you read it. In this case,
    Doug Feith asked a couple of people--there are mountains of
    this stuff and it is a big task to integrate it in your mind.
    He had this small group doing that, and they looked at
    terrorist networks, which seems to me to be a perfectly logical
    thing to do after September 11.
        Senator Levin. Thank you. My time is up.
        Chairman Warner. Senator McCain.
        Senator McCain. Thank you.
        Mr. Secretary, I am certainly glad to hear of the increase
    of 30,000 members in the United States Army, although it was
    done in a rather bizarre fashion by the Chief of Staff of the
    Army, as I understand. It is usually an announcement made by
    the Secretary of Defense, but it is not important.
        But a year and a half ago a number of us on this committee
    recognized the need for additional Marine Corps and Army
    troops, and I am sorry it took you so long to reach that
    conclusion. The reason I say that is because 40 percent of the
    troops in Iraq now will be Guard, National Guard, and Reserves
    and, despite your testimony, from my conversations with Guard
    and reservists around the country, you are going to see a very
    large exodus of members of the Guard and Reserve because of the
    incredible deployment burden that has been laid upon them. I
    hope that I am wrong, but that is what I am hearing from
    National Guardsmen and reservists throughout the Nation.
        Mr. Secretary, is it your intention still not to provide
    this committee with the communications concerning the Boeing
    decision, despite the fact that there is an Inspector General
    (IG) investigation and a Department of Justice investigation,
    and this is an issue of very serious consequence? I only have 5
    minutes, Mr. Secretary.
        Secretary Rumsfeld. Let me comment. First of all, it seems
    to me that your suggestion that it took us a long time to
    increase the size of the Army is not correct. The Army has been
    being increased over a 2-year period, under the emergency
    authorities authorized by Congress. General Schoomaker has only
    been in for a short period of months and he has fashioned a
    plan, presented it, and it seems to me a perfectly proper
    approach for the Chief of Staff of the Army to be the one
    discussing the way the Army is going to be organized and
    arranged. I do not consider it strange or unusual.
        In terms of the exodus issue from the Army, we certainly
    hope not. Pete Pace, do you want to comment on the retention
    and recruiting in the Army?
        General Pace. Sir, I can, sir. It is a snapshot in time,
    and we all need to be attentive to how we use our folks and
    what the downstream effects are. But, currently, all our
    retention goals, all of our recruiting goals, are being met. In
    fact, those Army and Guard units that are notified of going
    overseas, they have had an increase in those whose window was
    coming up for retention or getting out. They have increased
    that number by about 130 percent across the board.
        So the immediate snapshot is one of heroes--not victims--
    stepping forward to support their country. But you are correct,
    Senator, we do need to keep an eye on it that we have them
    doing missions that are viable, missions that they should be
    conducting, that we treat them with respect, that they know
    ahead of time when they can be called up, that they know how
    long they are going to be called up for, and that they know
    when they are going to be demobilized--all things we need to do
    better.
        Senator McCain. We will see. I hope I am wrong. That is not
    what I am hearing from the people that actually are being
    deployed and are returning, including in my own State.
        But please answer the question about whether you intend to
    turn over the documents to this committee or not, particularly
    in light of actual criminal investigations that are going on.
        Secretary Rumsfeld. The first thing I would say is that you
    have not received a definitive answer in a long period and for
    that, I regret that. The complexity of it, as I understand it,
    is that it is not a DOD issue in total. It is a matter of a
    longstanding practice of the DOD and other executive branch
    departments of not turning over internal documents that reflect
    advice and opinions of employees as they advise senior
    decisionmakers. You are aware of this. E-mails are considered
    that type.
        With respect to the tanker issue, because of the concerns
    that a great many people have raised and the criminal
    investigation--the investigation, I should say, that you
    mentioned----
        Senator McCain. You answered my question, Mr. Secretary. I
    would like your long answer to be made part of the record,
    okay?
        Secretary Rumsfeld. Fair enough.
        [The information referred to follows:]

        There is a longstanding practice in the Department of not turning
    over internal documents that reflect the opinions of our employees as
    they advise senior decisionmakers. Electronic mail, like any other
    document, is subject to this principle. Generally, electronic mail
    messages that have been disclosed outside the executive branch or that
    do not reflect communications of Federal employees in advising on
    decisions will be turned over. Those internal electronic mail messages
    that do reflect advice to decisionmakers will not be turned over. It is
    important that officials of this Department receive open and candid
    advice and assessments from its employees. Turning over documents
    containing the frank opinions and candid advice of employees at many
    levels in the Department could discourage them from providing the
    crucial communications that our officials need to make the important
    decisions they are charged to make. On the proposed tanker program, we
    have provided, in addition to documents, comprehensive explanations of
    this program in testimony, briefings, and interviews. We stand willing
    to provide briefings and interviews on this and other important issues
    as we have in the past.

        Senator McCain. Does it bother you when there are e-mails
    that have already been disclosed that say things, for example
    from Boeing, ``Boeing doing good stuff, Rudy and Andy met with
    Bill Schneider, Bill Schneider very supportive, will work issue
    in OSD''? Understand, Mr. Schneider is Chairman of the Defense
    Science Board (DSB), which will be, according to what you are
    about to tell me, reexamining the requirement. So you have the
    fox guarding the henhouse.
        Does it bother you, ``We have ghostwritten several op-eds,
    including former Commander in Chief of the Pacific Fleet
    (CINCPAC) Archie Clemins, we will have one in Navy Times and
    maybe in Air Force Times, and get an early bird when
    published''?
        Does it bother you when the Secretary of the Air Force
    calls in the Boeing lobbyist--these are according to the e-
    mails that we got from Boeing and why we need your e-mails, Mr.
    Secretary--and says, ``You have to put pressure on Mike
    Wynne.'' He chastises the Boeing lobbyist for not putting
    pressure on Mike Wynne?
        Does it bother you when, even after you had put a pause on
    the Boeing tanker deal, that Mr. Sambur sends out an e-mail
    that says the ``lease should be published today because all
    concerns concerning Ms. Druyun have been resolved''?
        Does it bother you when there are many members of the
    Defense Policy and Science Board who were lobbying DOD and Air
    Force officials to approve the lease of 100 Boeing 767s? Some
    of them are mentioned in the Boeing e-mails: Richard Perle,
    Bill Schneider, General Fogleman, Admiral Jeremiah, and Admiral
    Clemins.
        Does not all of this bother you, Mr. Secretary, that this
    incestuous relationship went on between Boeing, the United
    States Air Force, the Secretary of the Air Force in particular,
    and Mr. Sambur, and none of these people have been called to
    account for this kind of behavior?
        Secretary Rumsfeld. Senator McCain, I personally and we the
    Department take seriously any and every allegation of
    wrongdoing.
        Senator McCain. These are facts, Mr. Secretary. These are
    facts on paper, of e-mails that were sent within the DOD and by
    Boeing.
        Secretary Rumsfeld. As you are well aware, there is a DOD
    Inspector General's investigation of the entire aspect of this,
    and we are proceeding in an orderly and systematic way to try
    to come to the truth as to what took place. I assure you that
    if there has been wrongdoing, as there appears to have been, we
    will take appropriate action.
        I would say one other thing. When I left the DOD in 1977, I
    made it a point not to be connected with anything related to
    the Defense Department that was for profit. I did it so that I
    could always feel I could say whatever I wanted on a defense
    issue and not have someone do what you just did and suggest
    that, simply because I was connected to a defense company,
    therefore what I said----
        Senator McCain. I am not suggesting----
        Secretary Rumsfeld. Just a minute.
        Senator McCain. I am not suggesting, Mr. Secretary. I am
    telling you that Admiral Clemins, who is on your board, had
    ghostwritten by Boeing an article praising the tanker lease.
        Secretary Rumsfeld. I understand what you said, and I say
    we are looking into those things. But I do not think that
    simply reading off all of those names of people who happen to
    serve the government in a nonprofit way, on the Defense Science
    Board or the Defense Policy Board or some other advisory board
    of the DOD, that they are suddenly supposed to be in a
    cellophane package and not have any other thoughts or any other
    role in life. We understand----
        Senator McCain. I am talking about their actions. I am
    talking about their actions, not their position, Mr. Secretary.
        Secretary Rumsfeld. Well, we are looking into it. If we
    find any wrongdoing, I can assure you we will take appropriate
    action, as we have in the past.
        Senator McCain. Well, the Senate Armed Services Committee
    has the responsibility of oversight of the activities of your
    Department, and I do not see how we are going to be informed as
    to exactly what happened unless we see the communications and
    what went on in this decisionmaking process.
        I thank you, Mr. Chairman.
        Chairman Warner. I listened to you in your response to
    Senator McCain and you acknowledged that your Department was
    tardy in the response to some of the material which can be
    forthcoming, because, as the Senator said, this committee has
    oversight responsibilities, and we must continue to perform
    those and not just await IG reports and the like.
        I thank you.
        Secretary Rumsfeld. The IG reports, well, I will not get
    into the details, but the reason for the delay is because it is
    not totally a DOD decision. It is a decision for the executive
    branch, and we have to coordinate with the White House and the
    Office of Management and Budget.
        Chairman Warner. Thank you, Mr. Secretary.
        Senator Kennedy.
        Senator Kennedy. Thank you very much, Mr. Chairman, Mr.
    Secretary, General Pace. Thank you for representing the
    servicemen and speaking about their continued service to the
    country, which all of us are grateful for.
        Mr. Secretary, the U.S. Iraqi weapons inspector David Kay
    made it clear in recent days that his exhaustive postwar
    inspections leave little doubt that Saddam Hussein had no WMD
    at the time the war began. His conclusion is a devastating
    refutation of the Bush administration's case for war in Iraq
    and seriously undermines our credibility in the world.
        Until now, the administration has resisted the independent
    investigation of the issue, but now it is proposing
    investigation by a committee handpicked by the administration,
    with findings to be made only after the 2004 election. The
    White House agenda is clear--to blame the failure, the
    administration's case for war, on the Intelligence Community
    rather than the administration's manipulations and
    misrepresentations on the available intelligence.
        The debacle cannot all be blamed on the Intelligence
    Community. Key policymakers made crystal-clear the results they
    wanted from the Intelligence Community. Mr. Kay said, ``We were
    all wrong.'' He is wrong. Many in the Intelligence Community
    were right. There were clear warnings from the Intelligence
    Community. The dissents within the Intelligence Community to
    many of the positions taken by the administration were not
    noted or glossed over.
        As Senator Levin pointed out, your own DIA in September
    2002 said: ``There is no reliable information''--``no reliable
    information,'' Mr. Secretary--``whether Iraq is producing,
    stockpiling, chemical weapons or where Iraq has or will
    establish its chemical warfare agent production facilities.''
        The State Department Bureau of Intelligence and Research
    (INR) concluded: ``The activities we have detected do not add
    up to a compelling case that Iraq is currently pursuing what
    INR would consider to be an integrated, comprehensive approach
    to acquire nuclear weapons. INR considers the available
    evidence inadequate to support such a judgment.''
        Department of Energy intelligence disagreed that the famous
    tubes were a nuclear weapons program. The INR also concluded
    that the tubes were not intended for use in Iraq's nuclear
    weapons.
        Greg Thielmann, a retired career State Department official
    who had served as Director of the Office of Strategic
    Proliferation and Military Affairs at the INR, said it all last
    July: ``Some of the fault lies with the performance of the
    Intelligence Community. Most of it lies with the way senior
    officials misused the information they were provided.'' He
    said: ``They surveyed the data, picked out what they liked. The
    whole thing was bizarre. The Secretary of Defense had this huge
    Defense Intelligence Agency and he went around it.''
        Lieutenant Colonel Karen Kwiatkowski, a recently retired
    Air Force intelligence officer who served in the Pentagon
    during the buildup to the war, said: ``It was not intelligence;
    it was propaganda. They take a little bit of intelligence,
    cherry-pick it, make it sound much more exciting, usually by
    taking it out of context, usually by juxtaposition of two
    pieces of information that do not belong together.''
        We have seen in the examples that were mentioned this
    morning, for example just on the issues of stockpiling on
    chemical weapons, as mentioned by Senator Levin, in 2002 DIA
    said no reliable information on whether producing and
    stockpiling. You said in 2002 before this committee, ``We do
    know that.'' ``We do know that.'' I understand the Intelligence
    Community never says ``We know.'' But you said in September,
    ``We do know that.''
        In October the National Intelligence Estimate (NIE) said we
    have 100 metric tons, 500 metric tons of chemical weapons. We
    found that out in the last year. Secretary Powell says in
    February, ``That is a conservative estimate.'' The stockpile of
    100 tons to 500 tons--``That is a conservative estimate.''
        Then you say in March 2003, ``We know where they are.''
    ``We know where they are.'' That is an extraordinary leap, and
    that extraordinary leap was wrong.
        Do you not think that that independent commission ought to
    be really reflective of men and women that can look hard and
    fast, at not just what the intelligence was, but how it was
    manipulated, and interrogate career individuals in the
    Intelligence Community that believe that to be the case?
        Secretary Rumsfeld. Senator Kennedy, you might not have
    been here for my opening statement on the intelligence piece,
    but there was not a single thing in there that blamed the
    Intelligence Community or put any cast on it even slightly like
    you suggested.
        Second, I never have gone around the Intelligence
    Community. The Intelligence Community does not always agree.
    You have hundreds of people, and they have footnotes and they
    have different opinions. You develop a consensus. I have stuck
    with the consensus----
        Senator Kennedy. Are we not entitled to hear what the
    dissent was as well?
        Secretary Rumsfeld. Absolutely.
        Senator Kennedy. Did we ever? Was that provided----
        Secretary Rumsfeld. Absolutely.
        Senator Kennedy. Will you provide where these dissent
    positions were provided us prior to the time that we voted?
        Secretary Rumsfeld. I am not in the Intelligence Community.
    I do not deal with the Intelligence Community committees in
    Congress. I am saying that within the executive branch, when
    intelligence is circulated it includes footnotes, it includes
    differing opinions, as it always has for the last 30 years to
    my certain knowledge.
        Next, you have twice or thrice mentioned manipulation. I
    have not heard of it. I have not seen any of it, except in the
    comments you have made.
        Third, I am told by Dr. Cambone sitting behind me that the
    document you read from and possibly the same document that
    Senator Levin read from also has a paragraph in it that says
    the following: ``Although we lack any direct information, Iraq
    probably possesses chemical warfare agent in chemical
    munitions, possibly including artillery rockets, artillery
    shells, aerial bombs and ballistic missile warheads. Baghdad
    also probably possesses bulk chemical stockpiles primarily
    containing precursors, but that also could consist of some
    mustard agent and stabilized VX.'' That is in the same
    document, I am told.
        Last----
        Senator Kennedy. You said ``probable'' and ``possible,''
    ``probable'' and ``possible'' rather than ``we know.'' It is a
    big difference.
        Secretary Rumsfeld. I am coming to ``we know.''
        I could be wrong. I am asked a lot of questions. I use a
    lot of words, and I am sure from time to time I say something
    that in retrospect I wish I had not. However, I remember the
    moment I said ``we know'' something, and it was this: The
    forces had gone in, out of Kuwait into Iraq, and they were
    moving up and they had gotten in a day or two possibly, and
    they were a long way from Baghdad.
        As everyone on this committee will remember, the suspect
    sites, which is what they generally call them, for WMD that the
    Intelligence Community produced, the suspect sites tended to be
    north. They tended to be in the Baghdad and north area. Our
    troops were a long way from even Baghdad. I was asked, ``Where
    are the WMD?'' I think I said: ``We know where they are. They
    are up north; they are not down here.'' I was referring to the
    suspect sites.
        You are quite right. Shorthand ``we know where they are''
    probably turned out not to be exactly what one would have
    preferred in retrospect.
        But let me say one other thing. General Pace, would you
    please describe what the United States Armed Forces did every
    day by putting on chemical gear? They believed, we believed,
    everyone believed, they had chemical weapons. These people did
    not get into these----
        General Pace. Yes, sir. What we did, sir, was, as you would
    expect, prepare for the potential capabilities of the enemy.
    Even if you disregard all of the intelligence that was current
    at that time, if you simply looked at the fact that he had used
    chemicals against his own people, had used chemicals against
    Iran, it was prudent for military planners to believe that he
    might use chemicals against us when we attacked.
        So as we went across the line of departure, as we crossed
    from Kuwait into Iraq, all of our troops were in mission
    protective chemical gear, and they stayed in that, either just
    the suits themselves, sometimes the boots and the gloves, and
    on occasion the mask as well, as the tactical intelligence
    changed. They put that gear on and stayed in that well past the
    line at which we thought, which was about 60 miles south of
    Baghdad--well north of that line, they stayed in chemical
    protective gear.
        It was reinforced by discoveries on the battlefield, like
    3,000 brand new sets of chemical protective suits and atropine
    injectors that were found on the Iraqi side when they uncovered
    them in a school. Those kinds of discoveries led us to believe
    that if the Iraqis themselves had that kind of equipment and we
    knew we did not have chemical weapons, that they were preparing
    to use it.
        That is the kind of environment inside of which we wore the
    chemical protective gear. It was not only for the troops who
    were on the ground, but everyone in theater. The Navy guys at
    sea, the Air Force folks where they were, all had the chemical
    equipment right there with them and practiced daily getting
    into it in case they were attacked.
        Senator Kennedy. Thank you, Mr. Secretary.
        I just say that in your September 19, 2002, testimony to
    the committee you said five times that Iraq has or we know they
    have WMD.
        Thank you, Mr. Chairman.
        Secretary Rumsfeld. I am not going to go back and quote the
    comments from the previous administration and President Clinton
    and Vice President Gore and Secretary Cohen and all of that the
    way you have. I can just say that the stream of intelligence
    over a period of a long time in both administrations led the
    same people in similar jobs to the same conclusions.
        Chairman Warner. Mr. Secretary, that is an important point.
    You must recognize, we are slightly handicapped, that our
    offices are locked. We cannot get to a lot of the information
    we had intended to bring with us this morning. I will see that
    our record will remain open for an indefinite period of time
    until our offices are once again opened and material is
    available to members to put in the record and ask such further
    questions as may be appropriate.
        But you are quite correct on that, Mr. Secretary, and there
    is a continuity between the manner in which these facts were
    brought to the attention of the American public by the
    succession of the Clinton and the Bush administrations. I think
    in time we will get the answers to it.
        But I would like to note one thing. In the mystery of where
    these weapons may be, perhaps it will be solved, but we should
    thank God that they were not there to be used against our
    troops, bottom line.
        Yes, Senator.
        Senator Levin. Mr. Chairman, I just want to make it clear
    that the record will be kept open and not just for whatever
    submission you referred to, but for other submissions and for
    additional questions, given the short period of time that we
    have to question the Secretary.
        I wonder, just how long would that record be kept open? A
    couple of days?
        Chairman Warner. You and I will consult. We have to know
    when our offices are opened, and that is an undetermined period
    of time.
        We will now proceed to Senator Roberts.
        Senator Roberts. Thank you, Mr. Chairman.
        Senator Kennedy has indicated that we need somebody to take
    a hard look at the intelligence that is hard and fast. Senator
    Kennedy, if I could have your attention.
        Senator Kennedy. Excuse me.
        Senator Roberts. I am hard; I am fast; I am from Dodge
    City; and I am chairman of the Select Committee on
    Intelligence. We have under Senate Resolution 400 marching
    orders to investigate or to make an inquiry in regards to the
    timeliness and the credibility of the prewar intelligence in
    reference to WMD and any terrorist activity, the atrocities
    that were committed in Iraq, which are obvious, and also
    regional stability.
        I want people to know that in this committee, with this
    hard and fast and tough chairman from Dodge City, we have had a
    7-month, 24-7, 10 staff members, work just tremendous overtime
    effort. We have a working draft over 300 pages long that will
    be presented to the members of the Intelligence Committee as of
    tomorrow.
        We have interviewed over 200 analysts, including critics,
    including people mentioned by Senator Kennedy. I must say that,
    after repeated interviews by our staff, to date we still have
    yet to find any coercion or intimidation on the part of any
    analyst to change their analytical product. It is the most
    comprehensive inquiry in intelligence in at least a decade.
        After this Thursday, we will meet again after a week, after
    members of the Intelligence Committee are able to digest and
    educate themselves to what is in this report. We hope to agree
    on a report. That may be a little tough, but we are going to
    get that job done. We will be making some recommendations, as
    opposed to simply pointing fingers of blame.
        We will redact the classified material. We will work with
    the Agency to get that done. We will have deadlines. We will
    make a public report. I hope we can do it in March.
        If there are any egregious policy decisions that we find in
    this report, we will look into it. Under Secretary Feith will
    again appear before the Intelligence Committee, along with his
    subordinates. CIA Director Tenet will also appear, and I cannot
    emphasize enough how aggressive, how strongly I feel that we
    will let the chips simply fall where they may.
        Over the course of the inquiry that we hope to complete
    soon in the Intelligence Committee, we have found a large and
    consistent body of analysis, as you have indicated, Mr.
    Secretary, over 10 years in regards to Saddam Hussein in
    reference to his WMD capability. This intelligence was used,
    the famous word ``used,'' by the executive, by President
    Clinton, by President Bush, and also by those of us in
    Congress. It was used on the no-fly zones, on the sanctions, on
    the targeted bombing attacks, and, finally, in regards to
    military action.
        I would just like to quote the President when he indicated
    that ``We simply cannot allow our adversaries to build arsenals
    of nuclear, chemical, and biological weapons and missiles to
    deliver them. There is no more clear example of this threat
    than Saddam Hussein. The UNSCOM inspectors believe that Iraq
    still has stockpiles of chemical and biological munitions, a
    small force of Scud-type missiles, and the capacity to restart
    quickly its production program and build many more weapons. Let
    me be clear: A military operation cannot destroy all the
    weapons of mass destruction, but it can and will leave him
    significantly worse off than he is now in terms of the ability
    to threaten the world with these weapons or to attack his
    neighbors. He will know that the international community
    continues to have the will to act when he threatens again.''
        That statement was made by President Clinton, and I am not
    trying to point out President Clinton or President Bush. The
    key question is, did you find this intelligence to be true and
    consistent prior to the military action? I think your answer is
    going to be ``yes.'' I think that is going to be stressed all
    the way through this hearing and your answer. So I will leave
    that to you to answer that question, after I have answered it
    for you.
        Secretary Rumsfeld. I agree. It has become developed and
    adjusted as one goes along, but the threads have been
    consistent.
        Senator Roberts. All right. Now, as everybody knows, there
    has been a global Intelligence Community failure, on the other
    hand, in regard to whether or not they had WMD stockpiles and a
    challenge really to recommend systemic reform. You have gone
    over some action steps that the military is taking. If I can
    find my list, you said the DCI is having a review with the Kerr
    report. The DIA is conducting their review. All the Services
    are conducting their reviews. You are working with the 9/11
    Commission.
        We have the House Intelligence Committee investigation, the
    Senate Intelligence Committee investigation, and now this
    outside Warren Commission type of investigation. There are at
    least six or seven panels now doing investigation on the
    systemic reform that must take place because of the mistake in
    regard to the stockpiles. I hope the hell there is somebody
    left down at the CIA to actually conduct the global war on
    terrorism, with all of these activities.
        But I guess my question to you is, we will have Mr. Tenet
    up again. We will have Secretary Feith up again. We will get
    our work done. I trust that you are committed to really trying
    to find out how we can do this better because, as the Senator
    has indicated--I am talking about Senator Kennedy now--many
    strong statements were made. I believed that we would find the
    WMD. Dr. Kay believed that. Dr. Duelfer even still believes
    that. Still there was a failure in regard to intelligence.
        Would you have any comment?
        Secretary Rumsfeld. Well, Dr. Kay is probably correct when
    he said that we are not completed; we are 85 percent down the
    road, and there is more to be looked at. We will know ground
    truth before it is over, and the ISG and Dr. Duelfer have a big
    task to finish it up.
        I agree completely; the country, the President of the
    United States, is determined to get to the bottom of this
    question. Your committee is determined; Congress is determined;
    and I am sure we will as a country get the answers as to what
    took place. I personally believe that the independent
    commission that the President has proposed is a good thing to
    do. I agree with you that there are a great many people looking
    at this, but it is a big subject. It is an important subject.
        As we go into the 21st century and look at the challenges
    and threats we face, we have to have a high degree of
    confidence that we understand them and we understand what we
    know about them and what we do not know about them.
        Chairman Warner. Thank you, Senator Roberts.
        Senator Roberts. As we say as individual Senators, I know
    my time has expired, but I do want to quote Dr. Kay in regards
    to: The world is far safer with the disappearance and removal
    of Saddam Hussein. When we have the complete record, you are
    going to discover that after 1998 it became a regime that was
    totally corrupt. Individuals were out for their own protection.
    In a world where we know others were seeking the WMD, the
    likelihood at some point in the future of a seller and a buyer
    meeting up would have made that a far more dangerous country
    than even we anticipated with what may turn out to be not fully
    accurate estimating.
        I thank the chairman for his leniency.
        Chairman Warner. Thank you very much.
        Senator Reed.
        Senator Reed. Thank you very much, Mr. Chairman, Mr.
    Secretary.
        I do not think I am the only one who is alarmed at the
    significant costs associated with Afghanistan and Iraq that are
    not included in this budget, and alarmed that these off-book
    transactions are potentially dangerous and misleading.
        Secretary Rumsfeld. Pardon me, I am having trouble. What
    was misleading?
        Senator Reed. Well, I think there is a number of costs that
    we assume----
        Secretary Rumsfeld. A number of what?
        Senator Reed. Costs.
        Secretary Rumsfeld. Costs?
        Senator Reed. Costs associated with Iraq and Afghanistan:
    the ongoing commitment of over 100,000 troops, the
    recapitalization of equipment, the bonuses that we will have to
    use to maintain troop strength. All these costs do not seem to
    be properly included within the budget going forward. There
    seems to be a prospective reliance upon a supplemental sometime
    down the road.
        Secretary Rumsfeld. Well, Senator----
        Senator Reed. May I complete?
        Secretary Rumsfeld. Sure.
        Senator Reed. It seems that the operative logic here is
    that if it cannot be properly or accurately estimated, then it
    is assumed to be zero or it is excluded from the budget. In
    fact, what I find alarming is that seemed to be the logic that
    applied to post-combat operations in Iraq last year, when many
    people on this committee asked for estimates about the cost of
    ongoing operations, the costs of occupation, and we were told
    essentially, ``Well, we cannot estimate them, so we will not
    include them in our specific budget request.''
        That led to a $79 billion--a huge supplemental last year. I
    feel we could be on the same track.
        I just want your view, Mr. Secretary.
        Secretary Rumsfeld. Well, Senator, I am confused by your
    comment. Last year we came before Congress and had a plug
    number to propose--or 2 years ago, I guess it was--for
    Afghanistan. We were told by Congress: ``Do not do that.
    Supplementals are for wartime operations; we will not consider
    any proposals for the wartime operation in Afghanistan or
    Iraq.''
        The reason the budget is cast the way it is cast is because
    Congress insisted that it be cast the way it is currently cast.
        Senator Reed. Well, Mr. Secretary, I do not believe I
    insisted on that; did I?
        Secretary Rumsfeld. You are a Member of Congress.
        Senator Reed. I know, but I am not going to accept an
    argument saying that we forced you to disregard costs, not to
    include proper estimates, not to include in your proposal to
    Congress what you think you need.
        Secretary Rumsfeld. Senator, we were zeroed out. We
    proposed it, and it was zeroed out. We were told, ``Do not do
    it this way.''
        Senator Reed. Do you think that is the right approach, Mr.
    Secretary?
        Secretary Rumsfeld. No. Obviously, we wanted----
        Senator Reed. Then why do you not propose a budget that
    reflects accurately all the costs that you anticipate over the
    next year for Afghanistan and Iraq?
        Secretary Rumsfeld. The decision was made, after Congress
    rejected that approach, that the executive branch would try to
    use supplementals for the purpose of wartime operations, but
    not for various things that just were not included in the
    budget.
        Senator Reed. Mr. Secretary, as I recall the debate about
    the $10 billion, it was not the fact that we were telling you
    do not put the money in. We wanted to know what you were going
    to spend it for. You wanted $10 billion unconditional, to be
    spent anyway you wanted. That is a usurpation of our
    responsibility to appropriate money for specific items.
        You have the obligation to come before us with a detailed
    estimate of the cost and what you propose to do in the way of
    covering those costs. I cannot understand how you can argue
    that we are forcing you to disregard costs.
        Secretary Rumsfeld. I did not suggest that at all. That was
    your statement, not mine, Senator. What we are doing is we will
    come before Congress with the proposal for what should be spent
    in a supplemental. There will be the details; there will be the
    justification, just as there would have been in the budget.
        Senator Reed. Why can you not include those costs today in
    your budget, so that we can make appropriate decisions about
    offsets, about priorities? This is to me extraordinarily
    ineffective and misleading budgeting, and it is not because
    Congress has ordered you. I would suspect that the law requires
    you to send up a budget here that covers all your anticipated
    costs.
        Secretary Rumsfeld. Well, Senator, if you go back over the
    years you will find that every war has been funded by
    supplementals. That is what has been done throughout my adult
    lifetime. I do not know a single situation where there has been
    a war that has been funded by a budget----
        Senator Reed. Mr. Secretary----
        Secretary Rumsfeld.--that is developed a year and a half
    before and then submitted to Congress for a war that is
    ongoing.
        Senator Reed. Mr. Secretary, we both understand that
    supplementals are used to cover unanticipated costs that arise
    after the budget documents are presented and because of other
    exigencies that take place. You know fully well, as we all do,
    that we will be committing over 100,000 troops to Iraq, other
    troops to Afghanistan. These troops have costs. Their costs are
    numerous, myriad costs. Yet you are telling us now that,
    because we have told you you have to operate with a
    supplemental, you are not putting those costs in the budget?
        Chairman Warner. Senator, your time is up.
        I would like to observe that the Appropriations Committee
    has a lot to do with the supplementals and the policy governing
    those supplementals. I believe if you will consult with Senator
    Inouye and Senator Stevens that this is their domain and they
    made that decision. If I am incorrect, Mr. Secretary----
        Senator Reed. Mr. Chairman, the Secretary basically said
    that he has not included all the costs that he anticipates this
    year for operations in Afghanistan and Iraq in this budget,
    and, therefore, we are not getting a full picture in the budget
    of the anticipated, the known, the most likely military
    operations of this Government for the next year.
        Secretary Rumsfeld. I would phrase it quite close to that,
    but not exactly--that it is not possible to predict costs a
    year in advance in a war. Wars are uncertain things. It is
    possible to say, you are correct, Senator, that the funds for
    the ongoing conflict in the global war on terror and
    Afghanistan and Iraq are not in the budget. That was specified
    in the budget when it was presented. That is the pattern that
    has developed during the 3 years I have been back in this post,
    as I understand it, as a result of an interaction between the
    executive and the legislative branches at a level far above me.
        Chairman Warner. Senator Chambliss.
        Senator Chambliss. Thank you, Mr. Chairman.
        Mr. Secretary and General Pace, let me make sure that we
    remind you, as you do every opportunity you have and every
    opportunity we have, to convey to our men and women in uniform
    how much we appreciate the great job they are doing. As we go
    through this budget process, we want to make sure that we pass
    a budget that is reflective of the great work that they are
    doing and the great appreciation that all Americans have for
    that terrific work that all of our men and women are doing.
        I want to talk about a couple of specific issues, Mr.
    Secretary, relative to the budget. The two issues are first of
    all tactical air (TACAIR) and second air mobility. I know this
    is probably General Myers' specialty, but again you and I have
    talked about each of these in enough detail that I know you are
    prepared on this.
        First of all with respect to TACAIR, we have been talking
    about this train wreck that may be forthcoming down the road
    relative to Joint Strike Fighter, F/A-18, F-15, and the F-22. I
    note with very much approval that you have 24 F-22s funded in
    this authorization proposal. Last year during the Senate
    deliberations on the budget we had an issue relative to the F-
    22 and we worked through it. I am assuming because of your
    proposal that you are satisfied that procurement of F-22 is on
    time, on schedule, and continues to be on budget.
        Second, with respect to the TACAIR issue, I note that we
    are having some problems with the Joint Strike Fighter. It is
    the same kind of problems we always have with every aircraft--I
    do not care what it is. We experienced it with the F-22, and
    our critics were quick to jump on us with respect to the F-22.
    But I want to make sure that you are satisfied that this weight
    issue on the Joint Strike Fighter is not something that is
    going to delay that, that both of these programs are on
    schedule, and that this train wreck that we have all feared may
    be forthcoming is going to be able to be avoided.
        Secretary Rumsfeld. Well, I certainly hope you are right.
    The F-22 has a cost cap on it. It had some troubles with the
    software, and the costs have gone up. The Joint Strike Fighter
    has a weight problem, and that is being worked on. As you
    properly indicate, that is not unusual in programs of this
    type. It is in its very early stages.
        If one talks to the experts in the Air Force, they seem
    reasonably confident that they have noted the problems, have
    addressed them, and have people proceeding on them in an
    orderly way.
        Do you want to add anything to that, Dov?
        Dr. Zakheim. Yes. Senator, as you well know, this is not a
    problem that is unique to the United States. This is an issue
    that always arises when you go from computer-aided design to
    actual engineering. It affects every country that builds an
    airplane.
        The decision that was taken, which was very prudent, was to
    deal with the issue now and to have cost control and
    essentially to get our arms around the problem now instead of
    taking some systems out and then having to reintegrate them
    later on at a much higher cost to the taxpayer. Of course, the
    Joint Strike Fighter is an international program and all our
    partners have agreed to this approach.
        Senator Chambliss. I am taking the response from both of
    you that you are very comfortable with the schedule of both of
    those programs at this point?
        Secretary Rumsfeld. I am never comfortable. They are always
    complicated; they are always difficult; they always seem to
    take a little longer than you wish; and they always seem to
    cost a little more than you would hope. But the folks that are
    working on them believe they have their arms around the
    problems, and they are working on them hard.
        Senator Chambliss. Mr. Chairman, I note my time has
    expired.
        Senator Sessions [presiding]. I believe Senator Warner
    asked that Senator Akaka be recognized. Senator Akaka, you are
    next.
        Senator Akaka. Thank you very much, Mr. Chairman.
        I would like to begin by permitting Senator Levin 30
    seconds.
        Senator Levin. Thank you very much, Senator Akaka.
        The issue of whether or not an intelligence investigation
    by an outside commission should be a truly outside commission
    or one just appointed by the President we can save for another
    place. If it is going to be independent, it has to be
    independent of the President, and that means Congress has to be
    involved in the selection of that commission and the rules.
    That is number one.
        Another issue, which we are not going to resolve here, is
    we believe on the Democratic side that the Intelligence
    Committee should look at the use of intelligence by the
    policymakers, not just at the production and creation by the
    Intelligence Committee. That is another issue for another place
    and another day.
        I want to put in the record something relative to the
    alleged continuity of intelligence between the Clinton
    administration and the Bush administration. I am going to put
    in the record three tables that were produced by the Carnegie
    Endowment. Table 3 compares pre-2002 intelligence assessments
    with October NIE assessment in 2002. So I am going to go down
    the list and put these tables in the record comparing pre-
    October intelligence with post-October 2002 intelligence.

              ``Iraq reconstituted its nuclear program after
            1998'': pre-2002, probably not; October 2002, yes.
              ``Iraq attempted to enrich uranium for use in nuclear
            weapons'': pre-2002, maybe; October 2002, yes.
              ``Iraq attempted to purchase uranium from abroad'':
            pre-2002, no; October 2002 NIE assessment, yes.

        Now, on the chemical weapons programs: ``Iraq had large
    stockpiles of chemical weapons:'' pre-2002, maybe; October 2002
    NIE, yes.

              ``Iraq had covert chemical weapon production
            facilities'': before 2002, not sure; October 2002, yes.

        On and on, the significant differences in the intelligence
    between before and after October 2002, laid out in this
    Carnegie Endowment study. I would ask that these be made part
    of the record.
        [The information referred to follows:]

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        Chairman Warner. Without objection. The Secretary should be
    given the opportunity to put in the record a rebuttal.
        Senator Levin. That was on Senator Akaka's time, so I
    appreciate it----
        Chairman Warner. I understand that.
        Secretary Rumsfeld. I would be happy to. I will say this;
    George Tenet was the DCI in the last administration and this
    administration, and he has indicated repeatedly that there are,
    as I said, threads of the intelligence that are consistent and
    provide continuity over a sustained period of time. He is the
    DCI.
        [The information referred to follows:]

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        Senator Levin. Thank you, Senator Akaka.
        Chairman Warner. Thank you very much.
        Senator Cornyn.
        Senator Levin. No, no. Senator Akaka still has the rest of
    his time.
        Senator Akaka. General Pace, various lessons learned
    reports have highlighted the problems associated with theater
    logistics during Operation Iraqi Freedom. My understanding of
    the problem is that there were two major drivers: first,
    shipments. Shipments were not well-configured for in-theater
    distribution when they left the United States, which shifted a
    major burden onto the deployed units there. Second, this
    problem was exacerbated by the lack of timely deployment of
    distribution units and equipment.
        My first question to you is, what is your assessment of
    these problems. Has DOD taken steps to ensure that these
    problems will not arise again as new units are deployed into
    Iraq?
        General Pace. Thank you, Senator. As I think you know,
    Senator, we had, as part of our prewar workup with the team
    that was going to be leading it in Central Command, folks who
    were focused on lessons learned. They went down to Tampa. They
    worked with the leadership in Tampa. They went with the forces
    overseas and they have worked with the forces since they have
    come back to collect just the kind of data you are talking
    about.
        When we looked at deploying the force, we knew that we did
    not need to repeat what we did last time, to move so much gear
    to theater. Literally last time, I am told, although I do not
    know the exact figures, about 90 percent of the logistics that
    were taken to the theater and Operations Desert Shield-Desert
    Storm had to be put back aboard ships and brought home. We
    wanted to avoid that problem.
        We wanted to make sure that we had the tooth forward and
    the tail sufficient, but coming up behind to support. In the
    process of doing that, the number of ships that were available,
    the numbers of planes that were available, were allocated by
    the Transportation Command commander in support of the troops
    on the ground.
        In doing so, there were certainly lessons about how to load
    ships and the kinds of things that, had they been there a
    little sooner, would have helped. But we have absorbed those
    lessons and we are taking those and redesigning our logistics
    system to make a joint logistics system. What we were able to
    do in this last one was coordinate and de-conflict each
    Service's logistics push forward. What we need, as we had with
    the joint fighting force, we need a joint logistics system that
    allows us to better coordinate and get the right gear to the
    battle at the right time.
        Were there problems? Certainly, sir. We have identified the
    problems and we are working on them.
        Chairman Warner. Thank you very much, General.
        Senator Cornyn.
        Senator Cornyn. Mr. Secretary, the London Financial Times
    reports February 4, 2004, that the ``U.S. is preparing to cut
    its troop levels in Europe by up to a third.''
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        My question is, with the ongoing Global Defense Posture
    Review and the likely decision to bring home troops from
    overseas bases, whatever that number may be--and perhaps you
    could comment on that--not to mention the decision to
    temporarily increase Army end strength levels, how will these
    be factored into the BRAC process?
        Secretary Rumsfeld. The BRAC process is just getting under
    way, and, of course, one would hope that the answer to your
    question would be that the BRAC Commission would do it
    skillfully. But at the moment we do not have a good solid
    number as to the number of forces that would be coming out of
    Europe, although there certainly will be forces coming out of
    Europe and also some out of Asia as well as elsewhere.
        The BRAC process task will be to look at that and see that,
    if the theory is right that there is something like 20 percent
    base capacity, facility capacity, excess at the present time.
    If that is true and then one brings forces home from overseas,
    one would think that the excess capacity here at home would be
    somewhat less than that and the BRAC Commission would have to
    take those things into account.
        Senator Cornyn. My next question has to do with the fiscal
    year 2003 creation of the Assistant Secretary of Defense for
    Homeland Defense, the purpose of which was to better coordinate
    and provide policy oversight for DOD homeland defense
    activities. Could you please explain how you see DOD's role in
    homeland defense evolving and how that will be factored into
    the BRAC process as well?
        Secretary Rumsfeld. Well, I do not know that it will have a
    relationship with the BRAC process. The forces we have, of
    course, around the world are available for homeland defense.
    The ones that are here are closest. The ones that are elsewhere
    are available. The principal responsibility for homeland
    defense, as we know, is the first responders, depending on the
    nature of the problem.
        But very quickly the DOD gets engaged. For example, at the
    Olympics last year in Salt Lake City we had a lot of forces
    there. In fact, we had a lot more forces there than we did in
    Afghanistan at that time. When there is a difficulty like at
    the Senate Office Building today, we have a chem-bio unit that
    is coming up to assist in that.
        But the Assistant Secretary for Homeland Defense task is to
    keep us in the Department sensitive to the responsibilities of
    the Department with respect to supporting the first responders
    here in the United States and to working closely with the
    Homeland Security Department and in the interagency process to
    see that there are the kinds of exercises and testing of
    systems to see that we are prepared and able to respond and
    coordinate properly with the people who have the principal
    responsibility.
        Senator Cornyn. Well, I know, for example, in my State the
    military bases frequently have memoranda of understanding with
    local communities so that if there is an emergency of some
    nature on base that the fire department, the first responders,
    off base can augment the resources available on base and vice
    versa. That is the thrust of my question.
        But to that extent, do you deem that relevant to the
    process? I mean, is that going to be factored in somehow or
    another?
        Secretary Rumsfeld. Well, certainly the statute lists a
    whole series of things that need to be taken into
    consideration, and I would think that those kinds of
    considerations would be included.
        Senator Cornyn. Thank you.
        Chairman Warner. In the instance of the last question and
    other questions, you might amplify for the record your
    responses, so that we can move along here expeditiously. I
    thank the witnesses and the questioners.
        [The information referred to follows:]

        Homeland defense mission requirements will be factored into the
    military value evaluation of DOD's installations within the Base
    Realignment and Closure process 2005 analytical effort.
        The criterion to be used in the Base Realignment and Closure
    process is as follows (as published in the Federal Register on February
    12, 004):
    Military Value
        1. The current and future mission capabilities and the impact on
    operational readiness of the Department of Defense's total force,
    including the impact on joint warfighting, training, and readiness.
        2. The availability and condition of land, facilities and
    associated airspace (including training areas suitable for maneuver by
    ground, naval, or air forces throughout a diversity of climate and
    terrain areas and staging areas for the use of the Armed Forces in
    homeland defense missions) at both existing and potential receiving
    locations.
        3. The ability to accommodate contingency, mobilization, surge, and
    future total force requirements at both existing and potential
    receiving locations to support operations and training.
        4. The cost of operations and the manpower implications.
    Other Considerations
        5. The extent and timing of potential costs and savings, including
    the number of years, beginning with the date of completion of the
    closure or realignment, for the savings to exceed the costs.
        6. The economic impact on existing communities in the vicinity of
    military installations.
        7. The ability of both the existing and potential receiving
    communities' infrastructure to support forces, missions, and personnel.
        8. The environmental impact, including the impact of costs related
    to potential environmental restoration, waste management, and
    environmental compliance activities.
        Homeland defense mission requirements will be factored into the
    military value evaluation of DOD's installations within the BRAC 2005
    analytical effort.
        The security of our Nation, whether expressed as homeland defense,
    domestic preparedness, or the global war on terrorism, is the primary
    DOD mission. Both the Base Realignment and Closure legislation and
    DOD's implementation of it ensures that homeland defense and security
    are considered in the BRAC process. Specifically, criterion two
    requires DOD components to consider ``the availability and condition of
    land, facilities, and associated airspace . . . as staging areas for
    the use of the Armed Forces in homeland defense missions.''
    Additionally, as a mission of DOD, all of these issues (homeland
    defense, domestic preparedness, and the global war on terrorism) are
    captured by the requirements of criteria one and three.

        Senator Ben Nelson.
        Senator Ben Nelson. Thank you, Mr. Chairman.
        Mr. Secretary, General, it is a pleasure to be able to
    recognize the men and women in the military and the wonderful
    job that they do. It is also a sobering experience for my
    colleagues and I to call the parents, the spouses of those who
    have been lost in Iraq or anywhere around the world.
        My question today is going to be a basic question. General
    Pace, last November I asked Acting Secretary of the Army Les
    Brownlee when every soldier in Iraq would be equipped with the
    most advanced body armor. I asked this question after a
    constituent called my office to complain that his son was
    conducting house to house searches in Iraq and still wearing
    kevlar. Secretary Brownlee said that all troops in Iraq would
    have the advanced body armor by December.
        My question, of course, is, do you know if this is now the
    case?
        General Pace. Sir, it is the case. In fact, it was January,
    last month, that 100 percent of DOD military and civilians in
    Iraq had been issued to them individually the advanced body
    armor. As we rotate the force, before they go into Iraq the new
    troops will have issued to them the new body armor. Thanks to
    the funding of Congress, we have been able to take the initial
    capacity of industry--when this war began, it was still in the
    technology environment. We were able to take that 1,600 set per
    month capacity, and we have built it up now, thanks to your
    funding, to 25,000 sets per month. We have met the objective
    and we will be able to ensure that everyone continues to have
    it as they enter the country.
        Senator Ben Nelson. I now hear that the 1057th
    Transportation Company, part of the 37th Theater Supply
    Command, is not outfitted with advanced body armor. They have
    some newer vests, but not the insert of the body armor. Their
    mission, as you may know, is the transportation of supplies and
    personnel into southern Iraq, which then also takes them into
    harm's way on a very regular basis.
        Do you know whether they have or can you look into that if
    you do not know whether they have it by now?
        General Pace. Sir, I will find out specifically whether or
    not every soldier in that unit currently has that. I can tell
    you for a fact that there are sufficient sets in Kuwait and in
    Iraq to have every single service member and DOD civilian with
    their own personal set. It is the plan as they rotate to ensure
    that each gets a set before they go in. But I will find out on
    that unit.
        Senator Ben Nelson. Thank you. I know that all of you are
    committed to the best protection for our men and women in
    uniform. You can appreciate the fact that when a call comes in
    from a parent concerned about the safety of his son or
    daughter, that is a matter of critical interest, as well it
    should be. I will communicate that information back to that
    very concerned parent.
        General Pace. Thank you, sir.
        Senator Ben Nelson. Thank you very much.
        Thank you.
        Chairman Warner. Thank you, Senator. That is a very
    important series of questions.
        Senator Ben Nelson. And my time is up.
        Chairman Warner. Thank you very much.
        Senator Collins----
        Secretary Rumsfeld. Mr. Chairman, could I just make a quick
    comment?
        Chairman Warner. Yes, sir.
        Secretary Rumsfeld. On reflection, Senator Levin mentioned
    a Carnegie report. I do not know. I have never seen it, but I
    suspect it is unclassified. If it came from open sources, one
    ought not to be surprised that there might be a difference
    between an open source document and what the DCI told me.
        Chairman Warner. We note that for the record. Thank you.
        Senator Collins.
        Senator Collins. Thank you, Mr. Chairman.
        Mr. Secretary, in your testimony today you have a whole
    section entitled ``Mass Versus Capability,'' and you state,
    ``Critical to success in military conflict in the 21st century
    is not necessarily mass as much as it is capability.'' But the
    fact is, whether we are talking about troops or weapons systems
    or body armor or ships, numbers still matter.
        For that reason, I want to talk to you about the
    shipbuilding budget. Our naval fleet now consists of only 294
    ships, and there are some projections that say that as cruisers
    and destroyers are decommissioned, the number may drop to as
    low as 180 ships. The Chief of Naval Operations has testified
    many times that a more appropriate fleet size would be
    approximately 375 ships. I realize that these ships of the
    future are going to be far more capable ships, but nevertheless
    the Chief of Naval Operations is still saying that our fleet
    size is considerably too small.
        There are also reports that the Navy is slipping
    construction of a second DDX destroyer by 1 year, from fiscal
    year 2006 to 2007. If that occurs, it will be the first year in
    more than 20 years that our military will not be procuring a
    major surface combatant. That threatens to exacerbate what is
    already a shortfall in the number of ships that would ideally
    be maintained in our fleet. But it also raises serious
    questions about the impact on our industrial base.
        I would like you to discuss the shipbuilding budget in
    light of the Chief of Naval Operations' belief that we are
    significantly underfunding shipbuilding and also with regard to
    the possibility of the DDX destroyer construction slipping.
        Secretary Rumsfeld. Yes, Senator Collins. This is the Chief
    of Naval Operations and the Secretary of the Navy's proposed
    budget for shipbuilding. This is their recommended budget. You
    are right: the ships at the end of fiscal year 2003 have
    dropped below 300 to 296. You are also correct that in the case
    of ships, capability is important, to be sure, but numbers do
    also matter because of presence. I agree completely with that.
        The DDX situation as I understand it, they provided a gap
    year, a delay of a year, to allow lessons learned from the
    first ship to be applied to the following ships. That was the
    judgment that was made in the Department of the Navy.
        With respect to the total shipbuilding program over the
    forward year defense plan, the numbers go from 7 to 9 to 6 to 8
    to 8 to 17, the 17 being because the ships nature, the littoral
    ships, and that you can do more of them.
        But we agree that, with the program that the Department of
    the Navy has put forward, it is a less manpower-intensive Navy.
    It is important that what they have arranged is a surge
    capability so that they are going to be able to provide greater
    seapower in more places, at more times, than had been the case
    in the past.
        General Pace, do you want to comment on it?
        General Pace. I can. Let me just take for example, ma'am,
    aircraft carriers, which in the past have been one-third on
    deployment--about four on deployment, one-third coming back and
    reconstituting and changing out ship's crews, and one-third
    getting ready for the next deployment. You have had generically
    about four that you could get to a battle right away.
        What Admiral Clark has done in his transformation of the
    Navy has made it so that he is going to be able to provide to
    any combatant commander anywhere in the world six of these
    carrier battle groups on demand. He is doing that by things
    like integrating Marine Corps and Navy aviation, so he has the
    wings that fly off the carriers working together as a unit and
    trained up.
        I will not take more of your time.
        Senator Collins. We are going to have to have further
    discussions on that.
        In closing, let me just say very quickly that I am also
    very concerned about reports that I am hearing from Federal
    employees' representatives and from the Office of Personnel
    Management (OPM) on the progress with the new personnel system.
    I will be following up in writing with some of those concerns.
        Chairman Warner. Senator, you keep a very watchful eye on
    this man's Navy. Thank you very much.
        Senator Pryor.
        Senator Pryor. Thank you, Mr. Chairman.
        Mr. Secretary, thank you again for being here and doing
    what you do. Let me commend you on one thing in your budget, if
    I may, and that is your treatment of housing for our men and
    women in uniform. Basically the way you have it structured now
    the housing is now a tax-free benefit that they receive, and
    that is a very positive thing. It is good for morale and good
    for the quality of life.
        There is one thing that I would love to work with you on
    this year, though, Mr. Secretary, and that is that, given the
    structure of the earned income tax credit and also the child
    tax credit, our men and women in uniform, even in a combat
    zone, could be penalized under the Federal tax system for
    serving in the military, and they could lose up to $4,000 a
    year.
        I do want to work with you on that this year. I was not
    aware if you were aware of that problem and if it is something
    that you perceive as a problem that we can solve in your
    budget.
        Secretary Rumsfeld. I am not aware of what you are
    referring to, but we would be happy to look into it and work
    with you.
        Senator Pryor. I look forward to working with you on that.
        I also want to look at Halliburton. I know there has been a
    recent spate of news stories about Halliburton. One said it
    overbilled about $28 million for food service over in the
    region in and around Iraq. I believe that was five different
    facilities if I have my facts straight. Then there was the
    story that we have all read and seen about overbilling for
    gasoline.
        There is another story about $6.3 million in overbilling
    for sort of unspecified services. I am not quite sure what that
    is, but I was reading some of the press clips on that.
        As I see these stories, I am sensing a pattern with
    Halliburton's billing practices. Mr. Secretary, I was wondering
    if you had that same concern that I do about Halliburton's
    billing practices?
        Secretary Rumsfeld. I will just make a brief comment and
    then Dov can comment on it, Dr. Zakheim.
        A prime contractor ends up with subcontractors. The
    subcontractor ends up then billing the prime, and the prime
    bills the person letting the contract. We have hundreds and
    thousands--not hundreds of thousands, but hundreds and probably
    thousands--of auditors. They are constantly looking at all of
    these things.
        In these things, they frequently come up with differences
    of opinion. They are all making the press, and that is fair
    enough. Those are all also things that we are concerned about,
    and the auditors are crawling all over them.
        Dov?
        Dr. Zakheim. Yes, Mr. Secretary.
        Senator, let me first tell you that in April of this year,
    with the Secretary's approval, I sent a team of auditors to
    Iraq. With the exception of the one press report about the $6.3
    million, and I will get back to that, every single report, in
    fact every single revelation, came from our auditors in our
    Department. Those auditors are also working with our inspector
    general and with the General Accounting Office (GAO), because
    they are on top of not just the issues you just raised, but of
    every single contract in Iraq, are every single contractor.
        You are right about the $28 million. That reflects what our
    auditors found relative to 5 of 58 facilities, and they are
    still working their way through the other 53. Kellogg Brown and
    Root (KBR) has agreed that there will be a withhold on that
    charge simply because there is a disagreement over how to
    estimate the number of people being served.
        With respect to the gasoline, again $61 million was
    identified. That has gone to the Inspector General, so I really
    cannot say very much more about that.
        With respect to the $6.3 million, that was something that
    KBR found themselves and they reported it. That gives you an
    indication, and it goes back to what the Secretary said: The
    prime contractor is doing its best to do the right thing when
    it has literally billions of dollars in contracts not that such
    funds have necessarily already been received and spent, but in
    terms of the size of the undertaking. A good part of that, the
    logistics, or ``logcap'' as it is called, was something they
    were awarded several years before the Iraq war and was for
    worldwide support.
        The basic issue that our auditors are finding is that of
    relationships with subcontractors, and we are working our way
    through that.
        Chairman Warner. Thank you very much.
        Senator Pryor. Mr. Chairman, I am out of time. Thank you.
        Chairman Warner. Thank you.
        Senator Ensign.
        Senator Ensign. Thank you, Mr. Chairman.
        Mr. Secretary, I want to try to protect you from something
    you said today that hopefully nobody will hold against you in
    the future. You said that we will know before it is over. In
    other words, ``we will know''--and I just want to make sure
    that you had a chance to correct that.
        Secretary Rumsfeld. Thank you. I'll correct it right now.
    We will know what we know, but we may not know all we would
    like to know when it is over. I thank you very much for that.
    You have saved me a tough question from Senator Levin a year
    from now. [Laughter.]
        Senator Levin. No, he has not. [Laughter.]
        Senator Ensign. I actually do want to go along that line of
    questioning, though, simply because I want to point out
    something that everybody is saying. That is that we basically
    know we have an intelligence failure, we think we know we have
    an intelligence failure, but yet members of the panel are
    saying it like it is fact.
        The reason that I am bringing that out is because to their
    best guess, they are saying it like it is fact, just like when
    you were before this committee, just like you said today, we
    know because in all probability we should know whether or not
    there were WMD and things like that.
        We should be a little more careful, but it certainly was
    not the intent of anybody on this committee to mislead the
    American public, hopefully it was not, just like I do not
    believe it was your intent on the ``we know'' comments.
        Secretary Rumsfeld. No indeed.
        Senator Ensign. So that is really important.
        But when we are doing these intelligence investigations--
    the most important part for all of us to keep in mind is that
    this should not be a witch hunt to find somebody, to find a
    scapegoat. It is important, if people did something wrong or if
    they purposely did something and misled people, then they
    should be held accountable. But the purpose it seems to me for
    the investigation, just like we did an intelligence
    investigation after the missiles of October, was so that we
    could improve our intelligence-gathering capabilities.
        We know right now that we have some problems. We have known
    that, actually, maybe for quite some time, and some people have
    been arguing that we need to improve the human intelligence
    instead of relying so much on our high-tech stuff.
        I guess I would just like maybe your comment on the focus,
    where the focus should be into the future. You have put up that
    satellite photo of North Korea. Okay, we identify, but how do
    we get into the future? How do we really improve our
    intelligence capabilities into the future?
        Secretary Rumsfeld. Well, my impression is that Director
    Tenet has done a lot to improve intelligence over these past
    years. The funding has been increased. Improving human
    intelligence--there has been a good deal of effort on that. It
    takes a long time, years, 4, 5, 6, 7 years, to actually
    strengthen that aspect of it.
        I am hopeful that the Senate Intelligence and the House
    Intelligence Committees, when they complete their report, will
    have thoughts on this subject, and certainly the commission
    will have thoughts on this subject.
        Senator Ensign. I guess one of the other comments that I
    want to make of us leaning forward, because of the media
    attention that has been focused on intelligence and possible
    intelligence failures, is that it will stop us from doing the
    right thing in the future. Some people might use this as we
    cannot trust our Intelligence Community.
        What Dr. Kay said has to be emphasized more than we can
    possibly emphasize it, in that, yes, there were probably some
    intelligence failures, but it does not take away from the fact
    that it may have been a more dangerous world than we thought. I
    am hoping that it does not change the administration's policy
    on forward-leaning, the idea of preemption, the idea of, ``If
    we could have prevented September 11, would we not have done
    everything we possibly could?''
        What we did in Iraq was prevent more September 11s, and I
    am hoping that this recent revelation does not change
    administration policy.
        Secretary Rumsfeld. Senator, you are on a very important
    point. We have to know that there are always going to be
    intelligence failures, and there also are going to be
    intelligence successes and they have saved people's lives.
        Second, there is a risk that policymakers would hesitate to
    make decisions or that analysts would hesitate to explain what
    they thought. One thing that is important that worries me about
    the discussion here this morning: it is critically important
    that there be interaction between users of intelligence and
    suppliers of intelligence. Each informs the other.
        The implication that if there is an interaction between a
    policymaker and a supplier of intelligence that somehow or
    other that is pressure or that is manipulation or that is not
    right or fair to them is wrong, because we each learn from each
    other. Inattentive users of intelligence have a responsibility
    to interact with suppliers, and the suppliers learn from that--
    of intelligence--and the user of intelligence learns, because
    they end up talking to each other in a very open way. That is a
    healthy thing, not a worrisome thing.
        Senator Ensign. Mr. Chairman, my time has expired and for
    the record I would like to ask the Secretary and your people to
    give us an idea of when you will have a plan on transforming
    the Guard and the Reserve, the idea of that spigot, when,
    approximate timetable you will have a plan for us.
        Secretary Rumsfeld. We have the plan, and we can brief you
    at your desire, whenever, particularly the Army. General
    Schoomaker is well along in it, and the Navy and the Air Force
    have some Reserve Forces, and they have some plans also.
        Senator Ensign. Thank you.
        Chairman Warner. Thank you, Senator.
        Senator Dayton.
        Senator Dayton. Thank you, Mr. Chairman.
        Mr. Secretary, I share the concern of Senator Reed about
    the fact that there is no money in the budget you submitted for
    fighting the ongoing wars in Afghanistan and Iraq. In your
    testimony you refer to the unknown costs of fighting wars. I
    guess I am incredulous that that is not something that DOD and
    the service branches can quantify fairly accurately. That is
    what you do. With all your experience and success in the
    private sector as well as the public sector, I just cannot
    believe that that is an unknowable figure for fiscal year 2005.
        Can we just, given that it is not in there, try to identify
    what we, for the purposes of our discussion and our
    decisionmaking, or it is already a factor in the transportation
    bill that we are considering now? I have seen numbers that said
    $4 billion a month is the cost of the current operation in
    Iraq--these are published reports--and $800 million in
    Afghanistan. Is it for estimation purposes reasonable to
    extrapolate that for fiscal year 2005?
        Secretary Rumsfeld. Senator, fiscal year 2005 starts
    October 1, 2004. It is what, 10 months from now? The budget for
    2005 that was submitted by the President this week was prepared
    starting in January 2003 and completed in November 2003, and
    given to the OMB, sent up to Congress in January 2004 for the
    year that starts in October 2005 and goes to September 2006.
        Now, if one thinks about it, that is anywhere from at the
    minimum 12 and at the maximum 24 months in advance. We do not
    know, we cannot know, how many troops we are going to want in
    Iraq in the period----
        Senator Dayton. Mr. Secretary, you must for planning
    purposes be making some assumptions. I am just asking you, can
    we reasonably assume on an estimated basis that the numbers I
    just read--$4 billion a month for the current operation in
    Iraq, $800 million a month for the current operation in
    Afghanistan, multiplied by 12 are an approximation for what it,
    under a best guess, will cost?
        Secretary Rumsfeld. You get into best guesses and you
    misinform people.
        Senator Dayton. I consulted last night an oracle. I said,
    who is best qualified to shed some light on this, and I went
    looking for Rumsfeld's Rules. I discovered it is not that easy
    to find them now. You are off the Web site. You are probably
    one of the few in the administration who practices them,
    especially as it relates to budget matters.
        But a couple of them that come to mind are: ``Be precise.
    Lack of precision is dangerous when the margin of error is
    small.'' This is Stephen Friedman. I do not know if he is
    quoting you precisely. He references a couple of them. ``If you
    cannot measure it, you cannot manage it. That which require to
    be reported on you will improve if you are selective.''
        It seems to me if we are going to manage--our role is to
    manage and we are making decisions first now in the next couple
    weeks about overall Federal budget and then as an authorizing
    committee about levels for the--this is the lineup we have and
    the timetable we are on. If you will not give us numbers, how
    can we manage and fulfil our responsibilities?
        Secretary Rumsfeld. My first choice would have been to do
    it. I tried to do it 2 years ago, and I was told by Congress,
    ``Do not do it.'' Now, that is a fact.
        Senator Dayton. But ``Congress'' covers a multitude of
    sins. I am only one.
        Secretary Rumsfeld. You said that. I did not.
        Senator Dayton. I did not have a role in that. I do not
    agree with Congress all the time, but I guess I am trying just
    to go back again because we are going to have to deal with
    this. Is this a state secret, what this estimate is for 2005?
        Secretary Rumsfeld. Of course not. What one can do and what
    we tried to do--in fact, what we proposed and were rejected on
    2 years ago--was to say: ``Look, you have alternative futures.
    You could end up with 115,000 troops in Iraq, or it could go up
    because the security situation could deteriorate and you might
    have to do something else, or it could go down because the
    Iraqi security forces exceed 200,000 and are capable of taking
    over a number of those responsibilities. It could be any one of
    those.''
        We came in with a budget that said that and said here is a
    midpoint; we do not know whether it will have to go up or stay
    the same or go down. We were told: ``Listen, wars are funded
    with supplementals; do it that way.''
        Senator Dayton. My time is up.
        Chairman Warner. Senator Sessions.
        Senator Dayton. Thank you, Mr. Chairman.
        Chairman Warner. Thank you.
        Senator Sessions. It may be in terms of spending money and
    Congress, ``Congress'' means Senator Ted Stevens. I do not
    know, but if I recall it was his belief that we should do it by
    supplemental. It certainly gives those few in Congress who
    oppose the war a readily available number to claim how much we
    are spending as justification for their opposition from the
    beginning.
        The intelligence issue will roll along. I do know that the
    truth always generally comes out. It was interesting that Dr.
    Kay, in his testimony the other day before us, indicated that
    the Republican Guard commanders in Iraq thought they had WMD.
    Only they would say: ``No, I did not have it, but my fellow
    commander had it. They would interview him and he would say: I
    do not have it, but commander such-and-such has it.'' They all
    thought they had it, but apparently it has not been found yet.
        Mr. Secretary, I commend you on continuing a steady train
    of transformation of the defense of America. I remember one of
    the first hearings I asked Mr. Wolfowitz that he had not broken
    enough glass, not enough people were hollering about the
    changes; maybe you were not making enough changes. He said:
    ``We have a plan and a thought to move steadily forward to make
    our Defense Department more relevant to the threats facing
    America, and I think you will see us accomplish that.''
        Do you feel that, even with this war that fell upon us, you
    are on track to make us, as Coach Eddie Robinson said, ``more
    hostile, agile, and mobile.''
        Secretary Rumsfeld. Indeed I do. There was a lot of
    discussion after September 11 as to whether the global war on
    terror should take precedence and we should try to forget
    transforming and not try to do two things at once. But, in
    reality, the transformation supports the global war on terror,
    and it is critically important.
        It not only supports it, but it informs it. It gives us the
    impetus to achieve the kinds of transformation and changes that
    are so necessary.
        Senator Sessions. Well, I thank you for having a historical
    vision of where we are today and where we need to go and moving
    steadily and effectively in that direction.
        I am so proud of our Guard and Reserve. I have visited a
    number of their ceremonies where they were activated and left
    their home communities, like Foley, Alabama, and Mobile, and
    the crowds were enthusiastic. They feel a sense of service.
    They do not feel, General Pace, they are victims. They feel
    like they are serving America. They want to be used well. They
    want to be used wisely.
        I have had personal interviews, Mr. Secretary, with the
    head of Guard and Reserve Forces, the commanders, and they tell
    me you are pushing them; you not only support them, but you are
    encouraging them to study how we activate people, to make it
    less burdensome on families. Would you share your personal view
    of how we can do better about handling Guard and Reserve?
        Secretary Rumsfeld. I will indeed. We have all three
    Services working to rebalance the active and Reserve components
    so that we do not have to overuse those Guard and Reserve units
    that have special skills that are in short supply in the Active
    Force. That rebalance is going forward, and it is going forward
    apace.
        Second, we have looked at the deployment and redeployment
    process, and we recognize the importance of certainty on the
    part of people. We are taking steps to improve the tools, the
    planning tools that will enable us to do a vastly more nuanced
    job. I am impressed with the effort that Transportation Command
    is engaged in. I am impressed with the effort the Joint Forces
    and the Joint Staff are engaged in. We have simply got to do a
    better job to make sure it is respectful of them and their
    families and their employers.
        Chairman Warner. Thank you, Senator, for discussing that
    Guard issue.
        Secretary Rumsfeld. Mr. Chairman, could I make one comment?
        Chairman Warner. One other thing. When you and I talked you
    told me a very important fact about the quantum of the Guard
    and Reserve which you felt, although they would serve and serve
    willingly, simply their skills did not match to the needs. Do
    you remember that discussion we had?
        Secretary Rumsfeld. Exactly, and that is what General
    Schoomaker particularly in the Army is in the process of
    working very hard to do. He knows what to do; he has it
    calculated; he knows the units--I believe he knows the units--
    and he is well along in that task.
        Could I make a quick comment?
        Chairman Warner. Yes.
        Secretary Rumsfeld. I hate to have the meeting end without
    making a statement that should have been made at the time
    Senator McCain was asking questions. I am advised that in
    selecting the DSB for the tanker recapitalization evaluation,
    the DOD took significant measures to ensure that individuals on
    the task force leading the evaluation--Admiral Don Pilling, USN
    retired, and Dr. Ted Gold as co-chairmen--had no relationship
    with Boeing or the tanker lease program, and the committee can
    be assured that no member of the task force will have any
    association with Boeing or the tanker lease program.
        I can further assure the committee that the chairman of the
    DSB, Dr. Bill Schneider, will recuse himself from any
    association with the evaluation or the task force efforts.
    Furthermore, the process and results will be entirely open
    since the evaluation task force will be operated in accordance
    with the provisions of P.L. 92-463, the Federal Advisory
    Committee Act, and DOD Directive 5105.4, the DOD Federal
    Advisory Committee Management Program.
        Chairman Warner. Thank you, Mr. Secretary. Could we get a
    copy of that document such that we can give it to Senator
    McCain?
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Warner. Now we will turn to Senator Clinton.
        Senator Clinton. Thank you, Mr. Chairman.
        Mr. Secretary, when Senator Reed and I were in Afghanistan
    over Thanksgiving we learned that the North Atlantic Treaty
    Organization (NATO) had not yet met its obligations or its
    commitment to provide additional troops for the provisional
    reconstruction teams (PRTs) and other purposes. So far as I am
    aware, they still have not done so. Could you please advise us
    as to what, if any, progress is being made to persuade NATO
    countries to contribute additional troops, as they had
    obligated to do so?
        Secretary Rumsfeld. I know that Lord Robertson, before he
    left at the end of December, had worked very hard on it, and
    the U.S. had been involved in assisting. The new Secretary
    General has been working on it as well. The last time I looked,
    there were still, out of the totality of the requirements, a
    few pieces that had not been filled.
        I suspect that what is happening is that the U.S., which
    has been under a memorandum of understanding first with the
    International Security Assistance Force (ISAF) and now with
    NATO ISAF, has worked together with them to fill in gaps as
    they occur from time to time. But to my knowledge, they have
    not fully completed everything, although they must be in the
    high 90 percent.
        Do you know?
        Dr. Zakheim. There is that. Also, with respect to the PRTs
    that you mentioned, the British are in fact in Mazar-e-Sharif.
    The Germans have one up and running as well. One of the issues
    has been where they go. We have eight of those now up and
    running, and the idea is to have new ones stood up. We are
    talking, to my knowledge, to at least five different NATO
    countries that have given preliminary indications that they do
    want to go in and set up PRTs. The question is, how do you do
    that in an organized fashion?
        Senator Clinton. You will keep this committee informed as
    it goes forward?
        Dr. Zakheim. Absolutely, Senator.
        Senator Clinton. Is Turkey one of those five countries?
        Dr. Zakheim. They are one of them, but there are several
    others, as I say.
        Senator Clinton. With respect to the budget, it is my
    understanding that, at least during the Vietnam War, the costs
    of the war were in the budget. Supplementals were used for
    additional costs. In September of this past year, I asked
    Ambassador Bremer when he appeared before our committee whether
    the administration would request an additional supplemental for
    Iraq and Afghanistan. He replied, ``If there is any further
    need, I would anticipate any further request will be done
    through the normal appropriations process. In other words, it
    will come forward as part of the regular appropriations
    process, the 2005 budget, presumably early next year.''
        With respect to the comments that Congress instructed----
        Secretary Rumsfeld. Excuse me. Were you referring to Iraq
    or Afghanistan in that last comment?
        Senator Clinton. Iraq and Afghanistan.
        Secretary Rumsfeld. Both?
        Senator Clinton. Both.
        With respect to the comments that you have made, Mr.
    Secretary, that Congress essentially told you not to do it a
    certain way, would you provide this committee with the names of
    those Members of Congress or the staff and with whom they
    communicated that demand in the Secretary's office at some very
    early date, please?
        Secretary Rumsfeld. Well, it was Congress overall. They
    just simply took it all out. They zeroed out the $10 billion we
    had requested.
        Senator Clinton. But Mr. Secretary, that was for a
    discretionary pool of $10 billion to be used as presumably you
    saw fit. We are talking about a budget that connects costs to
    missions and functions. As late as September 2003, Ambassador
    Bremer, who I believe reports to you, assured this committee
    that there would be requests done through the normal
    appropriations process. Now, if there is someone in Congress--
    not just Congress as a large undifferentiated mass--that is
    saying, ``Do not do that,'' we would like to know it.
        What the response from Congress was: We are not about to
    give you a blank check of $10 billion to be used with no
    oversight. We need to clarify that, because it goes right to
    the heart of the authority of this body and the kind of
    oversight that we are expected to provide.
        Indeed, it raises some questions because at least the press
    reports that there will be a supplemental after the election,
    which seems to me to be inappropriate. I would hope that we
    could get to a meeting of the minds as to exactly what is
    expected from the budget to these ongoing expenses in both Iraq
    and Afghanistan.
        Secretary Rumsfeld. Senator Clinton, I am told that you are
    right, that there have been some portions of wars that have
    been funded through the normal process. It appears that from
    1967 to 1970 in the Vietnam War they included some estimates.
    After 1970, I am told, they stopped putting cost estimates in
    because they did not prove to be very accurate and thereafter
    the Vietnam War was not, nor have, I believe, subsequent wars.
        Second, I suppose you could say $10 billion; it would not
    be fair to say what you said, ``Ten billion dollars to be spent
    any way you want, without any oversight.'' No department of
    Government does that. They always report; they always say what
    they are doing. They have to get it cleared, if it is major
    changes at all, from eight different committees. So there is
    plenty of oversight.
        The answer to your question about what Bremer said is also
    correct, and that is that if you take the supplemental, a
    portion of it was for the Coalition Provisional Authority
    (CPA), $18.6 billion as I recall. He said, and I believe Mitch
    Daniels and later Josh Bolten said, that that was for that
    period and that funds for non-military purposes, the $18.6
    billion, would, in fact, be put into normal appropriation
    process, and that is what is planned to be done.
        Senator Clinton. Planned to be done. It is not in the 2005
    budget?
        Secretary Rumsfeld. Anything--as I understand it--maybe you
    ought to say it in the Office of Management and Budget (OMB)
    language, Dov.
        Dr. Zakheim. Essentially the money was for reconstruction,
    and, as you recall, Senator, when that money was asked for, it
    was meant to extend beyond just 1 year. Then the idea was, and
    I believe Director Bolten has reiterated that, that once we get
    past that amount of money laid out, everything that is
    requested will become part of the normal budget and such
    requests are normally outside the Defense Department budget. So
    I do not think there is an inconsistency there.
        Senator Clinton. Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator.
        Senator Graham.
        Senator Graham. Thank you, Mr. Chairman.
        Mr. Secretary, I appreciate your generosity of time. I am
    just going to throw out some concepts to follow up with you
    later. Number one, my big fear after listening to this debate
    and discussion is that we are going to rush to get out of Iraq
    before the job is done. I know you will not do that. I want to
    let you understand that some of us up here know that predicting
    the future is a very hard thing to do. What it costs is what it
    costs, and what good have we done if we leave before the job is
    done?
        I am very hopeful that in the long term Iraq will become
    more stable. There is one less dictator to give money to
    suicide bombers in the Mideast. I think we are better off, and
    if we want to have that discussion politically, as Senator
    Kerry says, bring it on.
        But, bottom line, that is my political statement. Here is
    something that a lot of us agree on, and it may be I find
    myself on the outs with the Pentagon, the Guard, and the
    Reserve. You have tunnel vision about the role of the Guard and
    Reserve. The Guard and Reserve do not just answer the Nation's
    call; it also answers its State's call. There are 500,000
    people you say that are being underutilized. I would like some
    information about how many times those citizen soldiers are
    called up to deal with disasters in Alabama, South Carolina,
    Virginia, California, wherever.
        Second, I believe our homeland security needs are not being
    adequately met, that the Guard and Reserve has an additional
    role there that could supplement our homeland security needs.
    When you look at restructuring your force to meet the needs of
    the 21st-century war model, Iraq and other places like Iraq,
    let us not forget that the Guard has more missions than just
    that one mission.
        I want to leave with you a couple thoughts. Number one, I
    believe that 40 percent of the force in Iraq will be Guard and
    Reserve in the immediate future. I believe that it is going to
    get worse before it gets better, and it is time to start
    upgrading the benefits of those who are doing a good job for
    this country.
        Specifically, would you support reducing the retirement age
    from 60 to 55 for those who serve 30 years as a member of the
    Guard and Reserves?
        [The information referred to follows:]

        I do not support retirement reform that is solely for the purpose
    of reducing the age of eligibility. Simply reducing the eligibility age
    would provide an immediate benefit only to individuals who are already
    retired or eligible for retirement, and provides no immediate benefit
    to the vast majority of members who are bearing the burden of
    activation and deployment today. I view the Reserve retirement system
    as part of a total Reserve compensation package that should enable the
    Department to shape the force and achieve strategic human resource
    management objectives. It should enhance retention, particularly among
    members bearing increased burdens of mobilization; attract members to
    the force, both prior service and non-prior service personnel; and
    enhance personnel management flexibility. We need to make a careful
    examination of this issue in the context of total compensation. I will
    be forming an advisory committee to look at the total compensation
    program, including Reserve retirement.

        Secretary Rumsfeld. First, Senator, I agree completely. The
    President has said that we should stay in Iraq as long as is
    necessary and not a day longer. There is no suggestion of a
    premature departure.
        Second, I am not sure I agree completely with what you said
    about the Guard and Reserve. The implication of what you said
    was that they necessarily were the only forces available for
    U.S. needs, home needs, and domestic needs, and I do not agree
    with that. The Active Force also does a lot with respect to
    fighting fires or hurricanes or various other things that may
    happen. We look at it as a total force concept.
        Senator Graham. Right. But the primary mission of the Guard
    in its day-to-day training is title 32, not title 10.
        Secretary Rumsfeld. I understand, but I would not want to
    leave the impression that the Active Force is disinterested in
    homeland defense or in the domestic needs that they get called
    up to assist on.
        Senator Graham. No, sir, and I do not want to give you the
    impression that the Active-Duty Forces are somehow not doing
    everything. They are doing everything and then some. So I have
    some problems with you on end strength, too.
        But I do not want to get tunnel vision about the role of
    the Guard. Unlike the Active-Duty Forces, which have done a
    marvelous job, that are stretched too thin, are being asked to
    do too much in my opinion. You cannot rearrange the pie until
    you grow the pie. That is just my opinion about this. The Guard
    has a specific function, unlike the Active Forces, under title
    32.
        Chairman Warner. Ladies and gentlemen, we have to move
    right along.
        Senator Graham. Thank you.
        Chairman Warner. That is an important question, and I would
    hope you would provide your response for the record, because
    this distinguished member of our committee is an active member
    of the National Guard.
        Senator Graham. I am not part of the solution. I am
    probably part of the problem. I am not up here tooting my horn.
        Chairman Warner. If we do not stop, he is going to call you
    to active duty and send you overseas.
        Senator Graham. If that happens, you know we are really in
    trouble.
        But I do want to work with you, Mr. Secretary, to address
    the Guard and Reserve role in its entirety, to look at end
    strength, not just from an army like Iraq but maybe an army
    like North Korea, and see if this makes sense. But stay the
    course. The investigation will be done by an independent group.
    You have done a great job. You helped bring people out that
    were hurt during September 11. You are the right guy at the
    right time. So hang in there, and any differences I have with
    you will be honest differences, openly displayed. I am proud of
    what you have done for our country, so hang in there.
        Secretary Rumsfeld. Thank you very much.
        Chairman Warner. Well stated. Thank you very much.
        Now, gentlemen, the two of you will wrap up.
        Senator Bayh, you lead off.
        Senator Bayh. Thank you, Mr. Chairman.
        Chairman Warner. We are obligated to yield these chambers
    back to the other body here.
        Senator Bayh. I will move quickly. Thank you, Mr. Chairman.
        I would like to touch upon just a couple of things I hear
    frequently from the public, the first dealing with the adequacy
    and the quality of the intelligence we receive. I am interested
    in your opinion as a consumer of intelligence. I agree with all
    the things you said at the beginning. It is a tough and
    thankless assignment. We have a lot of good men and women
    trying to deal with circumstantial evidence, gaps in the
    evidence, contradictory evidence, denial and deception,
    etcetera, etcetera, etcetera. It is possible that good people
    get a lot of things right but occasionally make some mistakes.
        With that as a preface, many Americans would be interested
    in your opinion as a consumer of intelligence. On a scale of 1
    to 100, 100 being omniscience, 1 being clueless, how would you
    characterize the quality and the adequacy of the intelligence?
        Secretary Rumsfeld. In between. [Laughter.]
        Senator Bayh. Can you try and quantify it a little better?
    Many Americans right now look at perhaps the failure that we
    have experienced in Iraq, they look at the fact that we maybe
    underassessed Libya and Iran, and they wonder: ``Gee, just we
    are having to make decisions of great import. Just how adequate
    and reliable is this information?''
        Secretary Rumsfeld. You want to put that chart back up?

        See previously inserted chart.

        This is the problem. We are dealing with closed societies,
    dictatorial regimes. There is North Korea, not a light there.
    It is enormously difficult. The reality is we have had some
    wonderful successes, and some of them are not public. I hope
    George Tenet will make some of them public this week or next
    week because I think he ought to. The failures are very
    visible, and that is always the case.
        I cannot give it a grade. It would vary depending on the
    collection source. It would vary depending on the target. One
    has to live with that in this world of ours. You end up making
    the best policy judgments you can off of that.
        Senator Bayh. Perhaps this is a job for this commission,
    because when we make decisions about going to war or other
    things based upon understandably imperfect information, many
    people wonder just how imperfect is it. Is this an aberration
    or is this more the normal course of events?
        My second question just very briefly has to do with
    priorities, Mr. Secretary. I hear from a number of people, not
    a man or woman on the street, but from people more who follow
    these things more regularly. They look at the situation in
    North Korea, with their capabilities, their experimentations
    with longer range missiles, and the belligerent and erratic
    nature of that regime. They look at Iran with their well-known
    connections to terrorists and the fact that their program is
    further advanced than we thought. They now look at what we do
    know about Iraq, and they say that perhaps Iran and North Korea
    constitute even greater threats, yet we are spending over $100
    billion to address Iraq. We obviously have used force to
    liberate that country and trying to introduce democracy in that
    part of the world, and they wonder, ``Is this an appropriate
    ordering of priorities? Should we not be devoting more to
    trying to address the problems of Iran and North Korea, given
    now what we know?''
        Secretary Rumsfeld. Well, they are each being addressed in
    a different way. North Korea is being addressed in a diplomatic
    way in the relatively early stages since they made the
    announcements of their capabilities. Iraq had been addressed in
    a diplomatic manner through 17 resolutions of the U.N. over a
    period of a decade and a half. Iran has just been revealed to
    have more advanced nuclear activities than they had indicated.
        On the other hand, if you look at North Korea, they have
    lowered the height requirement to go into the Army to under 5
    feet, to 4 feet 10, because so many people were starved. There
    is abuse of the food distribution system at the present time.
    It is hard to know what is actually going on in there. We do
    know there are concentration camps. We do know that there are a
    lot of people that are trying to flee the country.
        We have imperfect knowledge in this world of ours. We do
    today and we will into the future. I personally believe that
    the President made the right decision with respect to Iraq. He
    is making the right decision to try diplomacy with respect to
    North Korea and to work those problems with the neighbors in
    China, Russia, and South Korea and Japan.
        With respect to Iran, there is obviously ferment and
    turmoil going on with the young people and the women and the
    people who want reform in that country, going on as we meet
    today. Each is going to play out in a way that I suppose is
    different.
        Chairman Warner. Thank you, Mr. Secretary. They are very
    clear responses to an important question.
        Senator Bill Nelson.
        Senator Bill Nelson. Good afternoon, Mr. Secretary.
        Secretary Rumsfeld. It is suddenly afternoon.
        Senator Bill Nelson. Mr. Secretary, I spoke to you about my
    meeting with President Asad in Syria. When I confronted him
    with why he did not stop the jihadists from going from Syria
    into Iraq, where they are killing our men and women, he
    answered without an answer, saying, ``Well, I cannot control my
    borders; you cannot control your borders.''
        Then he talked of the historical smuggling that goes on
    across that border, but then said, ``I would like to cooperate
    with the Americans.''
        I have reported that conversation to many people in our
    government, including you, and you seemed to dismiss that that
    was worth following up. Can you tell me why?
        Secretary Rumsfeld. Senator, my portfolio is not Syria and
    foreign policy. I do not believe I dismissed it, and I try not
    to be dismissive of anything. On the other hand, we know he has
    been notably unhelpful on his border. We know that he is
    working with Iran in funding Hezbollah and bringing them down
    through Damascus into Lebanon, into Israel.
        Senator Bill Nelson. I confronted him with all of those,
    and he was not cooperative.
        Secretary Rumsfeld. We know he is testing chemical weapons.
        Senator Bill Nelson. I confronted him with that.
        Secretary Rumsfeld. We know he has taken the Iraqi funds
    that are in Syria and refused to give us access to those funds,
    and they belong to the Iraqi people. That is a regime that has
    been almost consistently unhelpful.
        Senator Bill Nelson. I confronted him about the withholding
    of those funds. But if he were sincere, I do not see that there
    is any down side for us to explore that----
        Secretary Rumsfeld. I do not either.
        Senator Bill Nelson.--because it would lessen the people
    going in trying to harm Americans.
        Secretary Rumsfeld. Senator, we explored it with Libya, and
    Libya said, ``Here it is, let us come in and take it out.'' We
    sent airplanes in and took it out, and it is in the United
    States being examined--the documentation and the materials. He
    is opening up his country to inspectors. That is a very good
    thing. There is a model there.
        Saddam Hussein did not follow it. Qaddafi is following it.
    Asad is not.
        Senator Bill Nelson. Well, General Myers was interested in
    that, but General Myers works for you. It might be something
    worth exploring, and I would respectfully suggest that that is
    in the interests of the United States.
        Secretary Rumsfeld. I agree.
        Chairman Warner. Senator----
        Senator Bill Nelson. Mr. Chairman, I have been waiting this
    whole time. I have one more thing.
        Chairman Warner. I was not going to cut you off. Go ahead,
    take 1 more minute.
        Senator Bill Nelson. Good, thank you.
        Chairman Warner. I just commented I thought your question
    was well taken.
        Senator Bill Nelson. Oh, well, you are very kind. I thought
    you were asking me to stop.
        I have reported to you and Senator Levin on this very same
    thing.
        Now, the other thing that----
        Secretary Rumsfeld. I am going to have to ask it to end
    quite soon. I have the House hearing at 1:00.
        Chairman Warner. We are going to end in about a minute.
        Secretary Rumsfeld. I have to make a phone call in between
    and get prepared for that.
        Chairman Warner. Right.
        Senator Bill Nelson. Respectfully, Mr. Secretary, I was
    told not only about the WMD prior to the vote in the Senate,
    but I was specifically told what has now been made public by
    the President and the Secretary of State: that there were
    unmanned aerial vehicles (UAVs) that could be put on ships off
    the eastern seaboard and flown over eastern seaboard cities
    with the WMD. You can understand that I thought that was an
    imminent threat to the interests of the United States.
        However, what I was not told was that there was a dispute
    in the Intelligence Community over the veracity of that
    information, specifically, as reported by The Washington Post,
    that it was Air Force intelligence that specifically discounted
    that, that it was not true.
        My question to you is, why was I not told that there was
    this disagreement in the Intelligence Community, instead of
    being told that it was gospel truth that those UAVs could be
    flown over eastern seaboard cities?
        Secretary Rumsfeld. I do not know who told you that, and I
    would not use the word ``veracity.'' I would use the word
    ``accuracy.'' There was a discussion in the internals, in the
    Intelligence Community, and I have forgotten exactly how it
    worked. But one agency believed that the--I am trying to--is
    this unclassified or classified now?
        Chairman Warner. Mr. Secretary, I suggest you answer that
    for the record. It is an important question, and it will give
    you adequate time.
        Secretary Rumsfeld. It is, and there is a classified answer
    and an unclassified answer. I can give you an unclassified
    answer here and we would be happy to--Dr. Cambone can give you
    a classified answer in 1 minute.
        Senator Bill Nelson. Mr. Secretary, everything that I have
    said has been unclassified.
        Secretary Rumsfeld. Right. I am talking about my answer,
    not your question. Your question clearly is unclassified.
        My understanding is there was a discussion and some people,
    as is usual in intelligence, believed that the equipment
    associated with the Iraqi UAVs--which we saw and watched
    tested, they flew considerable distances, they were not big,
    but they did have the ability to carry something, and they had
    some vehicles in close proximity to them during some tests.
    There was a debate as to whether those vehicles had a role in
    connection with the UAVs or whether the vehicles had a role in
    connection with hydrogen balloons or weather balloons or
    something else.
        Dr. Cambone. Well, that is two different things.
        Secretary Rumsfeld. Is that two different things? Steve
    Cambone, come up and answer it for me.
        Senator Bill Nelson. Mr. Chairman, if you want to receive a
    classified answer I would be happy.
        Chairman Warner. Fine. At this point, Mr. Secretary, time
    has expired for everybody. You have been most patient.
        I thank you, Senator, and thank you, General. We have had
    an excellent hearing----
        Secretary Rumsfeld. Steve can give a 2-minute unclassified
    answer.
        Chairman Warner. All right, if you wish. Then we will
    proceed as you desire.
        Dr. Cambone. Yes, sir. There was, Senator, a dispute on the
    role of the UAVs. The Air Force had a different view than
    others in the community, and I think that you have two parts of
    the story combined that I would like to separate for you, if I
    may, in a closed session.
        But there was a dispute by the Air Force. It was resolved
    as part of the ordinary process of doing the NIEs and the
    estimates that are done. The Air Force maintained its dissent.
    What you are reporting on is an after-the-fact report of the
    Air Force's dissent.
        But let me clean up the parts for you in a different
    setting.
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Levin. His question is why he was not informed of
    the dissent.
        Dr. Cambone. That I cannot answer, sir.
        Chairman Warner. Okay, gentlemen----
        Senator Bill Nelson. That is the question.
        Chairman Warner. We thank you very much, Mr. Secretary,
    General. We have had an excellent hearing.
        [Questions for the record with answers supplied follow:]
                   Questions Submitted by Senator John McCain
                                  end strength
        1. Senator McCain. Secretary Rumsfeld, there seems to be some
    confusion relating to increasing Army end strength. The press has
    recently reported that you will increase Army end strength by 30,000
    over 4 years. Last week, my staff was briefed by the DOD Comptroller
    Dr. Zakheim that those reports were false and you still oppose
    increasing end strength. Where do you stand on increasing Army end
    strength?
        Secretary Rumsfeld. While I oppose a permanent increase in the
    Army's end strength, I strongly support a temporary increase of 30,000
    that allows the necessary flexibility for the Army, while fighting the
    global war on terrorism, to increase the number of Active Force brigade
    combat teams (BCT) from 33 to 43 between now and fiscal year 2007. A
    determination for an additional 5 BCTs (for a total of 48) will be made
    at a later date. This temporary measure will enable the Army to field
    standardized unit designs and transition to a unit-based personnel
    management system. Our intent is to make the Army more ready and
    relevant for the unpredictable nature of the emerging strategic
    environment. Once this restructuring is complete, the Army will return
    to their authorized strength by fiscal year 2009.

        2. Senator McCain. Secretary Rumsfeld, paying for the 30,000
    increase in troops is not included in the budget. Do you plan on
    relying on supplemental spending bills for the next 4 years to pay for
    this increase?
        Secretary Rumsfeld. No decision has been made on how to pay for
    this increase. Since the increase is not reflected in the fiscal year
    2005 request, we likely would need to fund it as part of a fiscal year
    2005 supplemental.

        3. Senator McCain. Secretary Rumsfeld, supplemental bills are
    submitted by the administration for emergency spending requests. Why is
    future end strength considered an emergency spending request? These are
    the same accounting gimmicks we accused the previous administration of
    committing.
        Secretary Rumsfeld. For fiscal year 2005, including this end
    strength increase in a fiscal year 2005 supplemental would be
    consistent with the administration position because it is directly
    related to the global war on terrorism, whose incremental costs are
    being funded in supplementals. Beyond fiscal year 2005, no decision has
    been made on how to fund the end strength increase.

        4. Senator McCain. Secretary Rumsfeld, every independent expert has
    called for increasing Army end strength. The demands of the global war
    on terror have stretched our military thin. Will the administration
    continue to oppose legislative efforts by Congress to increase end
    strength?
        Secretary Rumsfeld. While reducing stress on the Active and Reserve
    Forces continues to be a top priority within the Department, the
    addition of permanent end strength is not the most effective or
    efficient means to relieve stress on our forces. The Department is
    already using existing legislation that allows for temporary increases
    in end strength to meet mission requirements. Furthermore, the Army is
    aggressively reworking its division structure to create additional
    combat brigades from within existing end strength.
        In addition to the Army initiatives, there are several dozen other
    initiatives across the Department that will reduce stress on the force
    while increasing our capabilities. For example, actions are underway to
    realign units and specialties within the active and Reserve components
    to reduce mobilization and deployment imbalances. Also, the Services
    are taking actions over the next 2 years to convert as many as 20,000
    military positions that are civilian in nature to civilian status, so
    that more military billets will be available to support current
    operations.

                            national call to service
        5. Senator McCain. Secretary Rumsfeld, you are pursuing a temporary
    increase in manpower levels for the Army which will need to be phased
    out in a short time and could well reside in the Reserves. Does it not
    make sense to employ the Call to Service Act's 18-18-18 plan to augment
    the required end strength you are pursuing?
        Secretary Rumsfeld. The Army has implemented the National Call to
    Service Plan (NCSP) and established a 1-year test to quantify the
    impacts of this program. We want to allow NCSP to mature and to
    complete the 1-year test to help us make better decisions on the
    program and its place in the Army. Currently, our force stabilization
    and modularity efforts are key elements of our transformation. Some of
    the increase will be covered with the 15-month variable enlistment
    (VEL), although it does not mesh with the Army's stabilization plan.
    Furthermore, the structure the Army is creating during the increase is
    primarily infantry and armor. If we were to fill the ranks of the new
    Units of Action (UAs) with 15-month VEL soldiers, we would not have a
    sufficient population of infantry and armor noncommissioned officers to
    fill the ranks of these UAs later. Considering the historical loss
    rates of 3-year and 4-year term soldiers, and the propensity of the 15-
    month VEL soldiers to not reenlist, relying on the 15-month VEL to
    create temporary strength would create a critical shortage of junior
    leaders in our future UAs.

        6. Senator McCain. Secretary Rumsfeld, I would like you to discuss
    the implementation of the 18-18-18 plan that Senator Bayh and I
    included in the Fiscal Year 2003 National Defense Authorization Act. If
    the Army is envisioning only a temporary increase in end strength, it
    may be well-suited for the Call to Service Act's 18-18-18 plan. What
    percentage of your total force will be made up of personnel under this
    type of contract?
        Secretary Rumsfeld. The Army has implemented the NCSP and
    established a 1-year test to quantify the impacts of this program. We
    want to allow NCSP to mature and to complete the 1-year test to help us
    make better decisions on the program and its place in the Army.
    Currently, our force stabilization and modularity efforts are key
    elements of our transformation. The 15-month VEL cannot realistically
    be used, except on a marginal basis, as it does not mesh with the
    Army's stabilization plan. The temporary strength increase of the Army
    will need to occur across all parts of the military structure, not just
    the initial entry soldier. Our solution is focused on long-term results
    for shaping the Army as a whole. The Army is keeping the number of 15-
    month VEL accessions at approximately 2 percent of the annual accession
    mission. Assuming minimal reenlistment rates for these soldiers, less
    than half a percentage of the total force will be made up of personnel
    under this type of contract at any one time.

        7. Senator McCain. Secretary Rumsfeld, do you envision expansion of
    this program?
        Secretary Rumsfeld. The DOD initiated the National Call to Service
    (NCS) enlistment option on October 1, 2003, with all four Services
    participating. Although the program is new, we are pleased with its
    start and are enthusiastic about the future of the program. We are
    currently evaluating the program.

        8. Senator McCain. Secretary Rumsfeld, what is the role of the 18-
    18-18 plan playing in each of the Services?
        Secretary Rumsfeld. The NCS program plays a role in each of the
    Services as they implement the program in accordance with overall
    departmental guidance.

             The Air Force goal for fiscal year 2004 is 370 NCS
            participants. They started the program on October 1, 2003, with
            the first NCS enlistee on that day. To date, the Air Force has
            enlisted 295 NCS participants.
             The Army's goal for fiscal year 2004 is 2 percent of
            non-prior Service accessions, or about 1,450 participants.
            Unique among the Services, the Army is offering NCS program
            participation in 10 of its 41 recruiting battalions. The RAND
            Corporation will analyze the NCS program to determine its
            effects on other enlistment options and the degree to which NCS
            is a market expander in the high quality recruit market.
            Through February 20, the Army has enlisted 213 participants.
             The Marine Corps' goal for fiscal year 2004 is 175 NCS
            participants. The Marine Corps has enlisted 39 NCS participants
            to date, but expects no difficulty meeting the 175 participant
            goal.
             The Navy's goal for fiscal year 2004 is 1,000 NCS
            participants. Due to initial challenges with their recruit
            reservation system, the Navy did not start enlistments under
            NCS until January 2004. To date, they have enlisted 55
            participants, but see no problem in meeting the 1,000
            participant goal.

                                     bases
        9. Senator McCain. Secretary Rumsfeld, I applaud your leadership in
    reassessing our force structure in Europe and around the globe. Bases
    in the Central Asian nations of Uzbekistan and Kyrgystan have been
    invaluable in the Afghan theater. Reports indicate Romania, Poland, and
    Bulgaria as sites for future bases. Can you comment on this? What other
    countries are being considered?
        Secretary Rumsfeld.

             Global posture is really more than bases and
            facilities. It encompasses several factors--facilities,
            activities, relationships, usability of forces, surge and
            personnel management.
             As part of our process each combatant commander
            provided proposals for realigning the posture in their
            respective Area of Responsibility (AOR). A key theme in the
            realignment effort has been to strengthen and transform
            existing alliances, as well as build new partnerships.
             We are currently compiling a report on the overall
            Global Posture effort. It will contain a classified annex that
            will enumerate countries, by region, where we intend to
            position forces and capabilities.

        10. Senator McCain. Secretary Rumsfeld, I applaud your leadership
    in determining our future force structure, global basing strategy, and
    efforts to more fully integrate Active and Reserve Forces. What
    deadlines have you established to ensure these initiatives are folded
    into the upcoming BRAC process?
        Secretary Rumsfeld.

             We will use the Global Posture Review to inform the
            BRAC process. The review enables us to provide specific input
            on overseas changes for the BRAC 2005 process.
             This input will allow domestic implications of the
            review--with forces and personnel either returning to or moving
            forward within U.S. territory--to be effectively accounted for
            within the BRAC decisionmaking process.
             BRAC decisions in will be critical in preparing
            appropriate domestic infrastructure for those U.S. forces that
            will be returning to the U.S. and its territories.
             Rather than sub-optimizing through individual moves,
            BRAC looks at the whole picture, thus yielding more efficient
            and effective placement of forces.

                     BRAC is the best way to determine the
                    placement of forces relocating to the U.S. Both efforts
                    are necessary for a true capabilities-based
                    infrastructure prioritization.

                                   guantanamo
        11. Senator McCain. Secretary Rumsfeld, we commend our service
    members for treating the detainees at Guantanamo humanely and in a
    manner consistent with the principles of the Third World Geneva
    Convention of 1949. That said, many of the detainees in Guantanamo have
    been in captivity for 2 years. As you are aware, as time elapses, the
    quality of intelligence you can gather decreases. In December, Senator
    Lindsey Graham, Senator Cantwell, and I wrote you to inquire about your
    plans for the detainees in Guantanamo. Since I have not heard a
    response, can you please update me on your plans for prosecuting the
    detainees?
        Secretary Rumsfeld. I am likewise proud of our service members and
    the tremendous job they have been doing and continue to do in the
    operations at Guantanamo.
        It is important to note that the intelligence-gathering mission at
    Guantanamo continues to provide vital intelligence in the current
    conflict. The individuals being held at Guantanamo are providing us
    with important information that continues to help us in our efforts to
    undermine the al Qaeda network and defend the Nation against that
    network. For example, intelligence gained from Guantanamo has provided
    U.S. and coalition forces with information for use in planning and
    executing counterterrorism missions. It has enhanced and continues to
    expand our understanding of jihadist motivation, selection, and
    training process.
        As I mentioned in my February 18 letter, the President has
    designated six detainees as eligible for military commissions, and we
    are working through each case systematically. In  February, Guantanamo
    detainees Ali Hamza Ahmed Sulayman al Bahlul of Yemen and Ibrahim Ahmed
    Mahmoud al Qosi of Sudan were charged with conspiracy to commit war
    crimes. Prior to being charged, these detainees were assigned military
    defense counsel. Their trial dates and commission panel members will be
    selected at a later time. In addition to the assignment of counsel to
    and the charging of al Bahlul and al Qosi, military defense counsel
    have been assigned to Salim Ahmed Hamdan of Yemen and David Hicks of
    Australia.
        In addition to the above progress in the cases of those currently
    designated as eligible for commissions, we have also finalized a number
    of decisions that we believe are essential to moving forward and
    ensuring that the proceedings are full and fair. On December 30, the
    Department of Defense announced the selection of John D. Altenburg, Jr.
    to serve as the Appointing Authority. On March 17, 2004, I issued
    Military Commission Order No. 5 officially delegating the appointing
    authority responsibility to Mr. Altenburg. Mr. Altenburg brings with
    him a wealth of legal and military experience that will serve our
    Nation well in his performance of the Appointing Authority's duties.
    The progress made in the military commission process requires day-to-
    day management by an individual, like Mr. Altenburg, who can devote his
    entire attention to the process.
        The Department also announced the selection of Air Force Brigadier
    General Thomas L. Hemingway as legal advisor to the appointing
    authority. As legal advisor, Brigadier General Hemingway will aid Mr.
    Altenburg in the day-to-day management of the process by overseeing
    Appointing Authority personnel and advising him on legal matters
    concerning the military commissions.
        The Department of Defense also announced four individuals who will
    be designated to serve on the Military Commission Review Panel
    established by Military Commission Order No. 1 (Mar. 21, 2002). Those
    individuals are: Griffin B. Bell, who served as Attorney General under
    President Carter and as a judge on the U.S. Court of Appeals for the
    Fifth Circuit; Edward G. Biester, a Pennsylvania state court judge,
    former Pennsylvania Attorney General and former member of the U.S.
    House of Representatives; William T. Coleman, an attorney currently in
    private practice who has served as Secretary of Transportation and as
    an adviser to several administrations; and Frank Williams, chief
    justice of the Rhode Island Supreme Court. As you may know, the Review
    Panel is responsible for hearing appeals from the decisions of the
    military commission. In that capacity, the panel plays an integral part
    in ensuring the fullness and fairness of the military commission
    process.
        The General Counsel of the Department of Defense also issued a
    military commission instruction that provides specific details on the
    Review Panel's responsibilities and operation. Among other things, this
    instruction establishes term limits and permits removal of review panel
    members only for good cause and protects them against undue influence.
        As we continue to move forward with the military commission
    process, it is important to bear in mind that in past conflicts we
    generally prosecuted war criminals after we had been victorious. In so
    doing, we greatly diminished the need to protect information. In
    today's war on terrorism, we are prosecuting our enemies even while the
    war clearly remains ongoing. In this current conflict, perhaps more so
    than any other conflict before it, information is the critical weapon
    for defeating our enemies and the need for the protection of vital
    information continues.

        12. Senator McCain. Secretary Rumsfeld, on December 12, 2003,
    following a visit to the facilities in Guantanamo, Senator Graham,
    Senator Cantwell, and I expressed our serious concern over issues
    regarding the disposition of the detainees--some of which have been
    detained for over 2 years. Since we are waiting for your written reply
    to this matter, when will you make a determination on the final
    disposition of the detainees' status?
        Secretary Rumsfeld. I very much appreciate the time that you and
    Senators Graham and Cantwell took to see for yourselves the operations
    at Guantanamo as well as your thoughtful concerns and questions about
    the detention of enemy combatants at Guantanamo.
        As I noted in my February 18, 2004 response, at the time of capture
    and based on available information, the detaining combatant commanders
    determined that those detained were part of, or otherwise supporting,
    forces hostile to the United States. Under the law of war, enemy
    combatants such as those detained at Guantanamo may be detained until
    the end of hostilities. Our Nation continues to be in an armed
    conflict. As with any armed conflict, no one can predict when its end
    will occur. Regarding detainee disposition and status, there is an
    interagency process in place to review the status of detainees
    regularly, to asses their intelligence value, if any, and evaluate
    whether they remain potential threats. Although a stark departure from
    U.S. Government practice in past conflicts, we have already released
    some detainees and are currently engaged with a number of countries to
    seek arrangements to return detainees to their home countries.

        13. Senator McCain. Secretary Rumsfeld, when and how will you begin
    the process outlined in the Order of the Military Commissions that the
    President signed in November 2001, and will you have outside observers?
        Secretary Rumsfeld. That process is already well underway. In July
    2003, the President determined that six individuals were subject to his
    November 13, 2001 Military Order. In February 2004, Guantanamo
    detainees Ali Hamza Ahmed Sulayman al Bahlul of Yemen and Ibrahim Ahmed
    Mahmoud al Qosi of Sudan were charged with conspiracy to commit war
    crimes. Prior to being charged, al Qosi and al Bahlul were assigned
    military defense counsel. Their trial dates and commission panel
    members will be selected at a later time. In addition to the assignment
    of counsel to and the charging of al Bahlul and al Qosi, military
    defense counsel have assigned to Salim Ahmed Hamdan of Yemen and David
    Hicks of Australia.
        Approximately 80 members of the media will be permitted to attend
    and an offer has been extended to the International Committee of the
    Red Cross to have a representative observe military commission
    proceedings. We are currently examining whether it is logistically
    possible for additional groups or individuals to attend.

                                     budget
        14. Senator McCain. Secretary Rumsfeld, I notice in the new budget
    there are large increases in funding for already existing programs. How
    does this year's budget proposal figure into your long-term
    transformation plans?
        Secretary Rumsfeld. The fiscal year 2005 budget sustains our
    ongoing transformation plans. Transformation is a large undertaking,
    but it does not consume the entire acquisition budget. Many ongoing
    programs remain vital to the short-term and long-term superiority of
    our military--for example new ships, transport aircraft, trucks,
    communications gear. These ongoing programs will continue to consume
    large portions of our acquisition budget.

        15. Senator McCain. Secretary Rumsfeld, during your first
    appearance in front of this committee you questioned the need for three
    tactical aviation programs. Can we still afford three new tactical
    aviation programs: F/A-18E/F, F/A-22, and Joint Strike Fighter (JSF)?
        Secretary Rumsfeld. The fiscal year 2005 budget continues the
    multiyear plan we formulated in preparing the fiscal year 2004 request.
    This plan made adjustments in our tactical aviation programs to ensure
    that they were realistically funded and executable, i.e. affordable.
    These and all other major programs will again be subject to new
    scrutiny as we prepare our fiscal year 2006-fiscal year 2011 multiyear
    plan.

                                missile defense
        16. Senator McCain. Secretary Rumsfeld, under the fiscal year 2005
    DOD budget, top-line funding for missile defense is going up to $9.2
    billion, an increase of $1.5 billion over the previous year. In fiscal
    year 2005, the Missile Defense Agency (MDA) will start to ``initiate
    technology development and testing of advanced, lightweight space-based
    interceptor components'' with the goal of incorporating them into its
    Block 2012 capability. Arguably, these space-based interceptors cross
    the line from militarizing space to weaponizing space. Yet, this move
    is being done without any real debate on U.S. security needs. Is the
    U.S. space policy being updated to include the option to weaponize
    space?
        Secretary Rumsfeld. The MDA continues to study space-based
    interceptors along with many other technology programs and future
    capabilities. Building on prior technology assessment studies of space-
    based missile defenses, MDA will conduct an analytical effort in 2004
    to assess the potential benefits of these capabilities to support a
    layered missile defense system. MDA's current five year budget calls
    for continuing research and development in this area, with the option
    of developing a space-based test bed in Block 2012. Ultimately, any
    future decision to deploy interceptors in space would require
    additional Department and congressional decisions and funding.

        17. Senator McCain. Secretary Rumsfeld, MDA states that the Initial
    Defensive Operations system will not be considered to have achieved
    Initial Defensive Capability until after an assessment from the
    Director of Operational Test and Evaluation (DOT&E). Will this be
    DOT&E's report on the missile defense system that is expected in summer
    2004?
        Secretary Rumsfeld. Initial Defensive Capability will be achieved
    when a militarily useful increment of missile defense capability is
    available to place on alert. DOT&E will include appropriate comments on
    the Ballistic Missile Defense System (BMDS) the February 2005 report to
    Congress.

        18. Senator McCain. Secretary Rumsfeld, as you likely know, the
    DOT&E, Mr. Christie, has publicly expressed serious concern about the
    lack of operational test data for his office to evaluate. Given these
    concerns, how much can DOT&E really analyze this system?
        Secretary Rumsfeld. DOT&E will have access to all the testing data
    available on the BMDS deployable test bed. I expect that DOT&E will use
    the available data to provide the Department its fair and objective
    assessment of the defensive capabilities of the system.

        19. Senator McCain. Secretary Rumsfeld, the designation of a
    program as undergoing spiral development is crucial because, according
    to section 803 of the National Defense Authorization Act for Fiscal
    Year 2003, once a program is designated to be undergoing spiral
    development, it must show its development strategy, test plans,
    performance parameters, exit criteria, and operational assessment.
    Furthermore, from 2003 to 2008, the Secretary of Defense must give an
    annual report to Congress by September 30 on the status of each program
    undergoing spiral development.
        In the MDA budget request, this phrase is used to explain its
    development process (``Spiral development enables the execution of an
    iterative process for developing the BMDS. . . .'' p. 2), yet according
    to the GAO, there are no programs that are officially undergoing spiral
    development. Is the BMDS ever going to be officially designated a
    program undergoing spiral development?
        Secretary Rumsfeld. The BMDS was identified as undergoing spiral
    development after September 30, 2003 and, therefore, will be included
    in the Department status report due by September 30, 2004.

        20. Senator McCain. Secretary Rumsfeld, is it still reasonable to
    believe that the BMDS will be capability operational by the end of
    2004? Will the missiles be fully operationally tested by then?
        Secretary Rumsfeld. We still expect the BMDS to have operational
    capability by the end of 2004. As we have stated previously, this will
    be a limited capability with improvements to follow.
        The Ground-based Interceptors (GBIs) that are a part of the Ground-
    based Midcourse (GMD) element will not be fully operationally tested by
    the end of 2004; however, they will be proven in developmental tests
    against threat-representative targets. Operational testing of this
    initial and evolving capability will proceed as the test bed is
    complete and continue as part of the development program and as part of
    our validation and verification effort.

     joint requirements oversight council decision on joint standoff weapon
        21. Senator McCain. General Pace, in General Myer's posture
    statement he states that you are ``establishing a more rigorous process
    for reviewing joint requirements.'' He also affirms that ``in the near
    term, [you] are focused on improving how [you] determine our munitions
    requirements. Over the long-term, [you] plan to field improved
    munitions systems that build on our already superb precision-delivery
    capabilities.''
        It appears to me that the cancellation of the United States Air
    Force's (USAF) joint participation in the Joint Standoff Weapon (JSOW)
    program in favor of the USAF's Wind Corrected Munitions Dispenser
    Extended Range (WCMD-ER) is totally counter to the direction Secretary
    Rumsfeld is setting for the department.
        With respect to requirements, WCMD-ER has half the range, increases
    the signature for the delivery platform, and offers no plan to
    accommodate for the unexploded hazard of aging explosives.
        With respect to the business case, the decision ignores the sunk
    costs that have already been spent on integrating the JSOW into five
    USAF aircraft in favor of future integration of the WCMD-ER into two
    USAF platforms at the time when the USAF is about to realize their
    return on investment. How do you explain this decision?
        General Pace. The Joint Staff has absolutely increased its rigor in
    reviewing service as well as joint munitions requirements. We are
    currently coordinating between combatant commanders (COCOM), individual
    Services, and the Joint Staff to accurately depict warfighter needs
    through the Munitions Requirement Process. This effort will enable
    Services to better define the capability and funding requirements
    needed to support the combatant commander's operations plan (OPLAN)
    requirements and threat assessment.
        Addressing the USAF decision to terminate the JSOW program in
    fiscal year 2005, Director, J-8 directed a review of several munitions
    programs. Over a 3-month period, the Force Application Functional
    Capabilities Board (FCB) conducted an assessment of standoff weapons
    capabilities and the impact of the USAF termination initiative on the
    overall JSOW program. The Joint Staff assessment did not focus on a
    pure comparison between JSOW-A and WCMD-ER. The tasking sought to
    identify gaps, seams, and redundancies in comparing JSOW with other
    joint and Service munitions. The unique attributes of JSOW were
    recognized and these capabilities weighed against their cost/benefits
    to the warfighter. JSOW is a standoff outside point defense weapon
    (SOPD). WCMD-ER is also a SOPD weapon. While it does not have the same
    range as JSOW, WCMD-ER does have the ability to be launched outside the
    range of most tactical threat systems. We recognize the issue with the
    unexploded ordnance hazard, but this is a challenge for our entire
    inventory of area target munitions. A final theme in the assessment
    included Strategic Planning Guidance direction to accept risk when
    existing capabilities sustain our advantage.
        The USAF based its decision to end JSOW-A procurement on
    requirements analysis that concluded JSOW-A provided a capability that
    would be served by other weapons. The USAF, even considering the
    funding for JSOW to date, projected a cost savings of $398 million in
    the FYDP.
        The Joint Staff recommended canceling the JSOW program, stating
    that advancements in precision capability of other current and funded
    munitions could effectively serve the JSOW target set. Current standoff
    munitions, together with direct attack munitions delivered by stealthy
    platforms, provide the necessary capabilities to meet COCOM
    requirements. The Joint Staff concluded that cancellation of the JSOW
    program would present limited risk in joint warfighting capabilities
    and offer substantial offsets for other critical requirements.
        The Joint Staff concluded that DOD should accept limited risk and
    capture substantial offsets for future programs.

                               air force tankers
        22. Senator McCain. General Pace, regarding tanker aircraft, the
    National Defense Authorization Act for Fiscal Year 2004 calls for an
    ``Analysis of Alternatives,'' a long-term maintenance and training
    requirements study, and a corrosion study to be completed by March,
    April, and May 2004, respectively. Where are we with regard to each
    project? Specifically, who is conducting them? When will each be
    completed?
        General Pace. Independent Analysis of Alternatives (AoA) Public Law
    108-136 Section 134 directs the Secretary of the Air Force to submit an
    AoA by a federally-funded research and development center or another
    independent agency no later than March 1, 2004. The AoA Guidance was
    approved by the Under Secretary of Defense for Acquisition, Technology,
    and Logistics (USD(AT&L)) outlining the conduct of an AoA using a
    federally-funded research and development center or other entity
    independent of the DOD. This effort is expected to take 18 months to
    complete.
        Maintenance and Training Public Law 108-136 Section 135 requires
    the Secretary of Defense to submit a report, no later than April 1,
    2004, regarding long-term tanker aircraft maintenance and training
    requirements. The Air Force, more specifically the KC-767 and Trainer
    System Program Offices, are preparing the report, with Logistics and
    Materiel Readiness as the Office of the Secretary of Defense (OSD)
    lead. The report is expected to be submitted to Congress by USD(AT&L)
    no later than April 1, 2004.
        Aircraft Material Condition Public Law 108-136 Section 345 requires
    the Secretary of Defense to submit a report, no later than May 1, 2004,
    on the material condition of the KC-135 fleet. The statement of work
    has been prepared and the Center for Naval Analysis (CNA) is under
    contract. CNA is reviewing the available data and beginning their
    assessment.

        23. Senator McCain. General Pace, on December 1, 2003, the Deputy
    Secretary ordered a ``pause'' in the execution of the tanker contracts
    until the Office of the Inspector General (OIG) completes an
    independent assessment of allegations related to the tanker proposal.
    As you likely know, the Justice Department is also investigating
    matters related to the tanker program. It seems to me that the need for
    a ``pause'' prompted by the OIG's assessment applies with equal if not
    greater force to the Justice Department's investigation. In other
    words, the tanker contracts should not be executed until the Justice
    Department has completed its investigation. Do you agree? If not, why
    not?
        General Pace. I'm not in a position to comment about ongoing
    investigations. The Joint Requirements Oversight Council (JROC)
    approved the Air Refueling Aircraft Program Operational Requirements
    Document, thus validating the need for air refueling capability. This
    capability is essential to COCOMs, and we should take every appropriate
    action to satisfy it as soon as possible.
                                     ______

                 Questions Submitted by Senator Saxby Chambliss
                             targeted pay increases
        24. Senator Chambliss. Secretary Rumsfeld, I am concerned as I know
    you are about retention and morale among our troops, particularly those
    who continue to be deployed overseas for long periods of time.
    Apparently as DOD was putting together its fiscal year 2005 budget
    recommendation, the OMB took out DOD's proposals for targeted pay
    raises, primarily for career enlisted members. I realize that resources
    are tight and that we can't always fund every pay and benefit program
    on the table. Having said that, I would appreciate your thoughts on how
    we can continue to retain high quality personnel, most of whom have
    other options outside the military, and what you believe is the proper
    mix of pay increases and quality of life enhancements that will ensure
    we create an environment that will retain the necessary amount of
    soldiers, sailors, airmen, and marines in our Armed Forces.
        Secretary Rumsfeld. We've made great strides in reaching our goal
    of improving military compensation so that it is equal to or greater
    than the 70th percentile of private sector incomes for military members
    with comparable education and years of service. We've closed the gap
    for officers and will have closed nearly 80 percent of the gap for mid-
    grade non-commissioned officers (NCOs) with this year's 3.5 percent
    (Employment Cost Index (ECI) plus \1/2\ percent) across-the-board pay
    raise. We remain committed to achieving this goal. Our service members
    have seen this commitment over the past few years in increases to pay
    and housing allowances. This year's budget provides the resources to
    eliminate the remaining 3.5 percent out-of-pocket housing expenses for
    the average member on the first of January.
        Further, I am appointing a Defense Advisory Committee on Military
    Compensation to conduct a comprehensive review of military compensation
    for Active and Reserve Forces with a view toward simplifying and
    improving our compensation program to ensure we retain the right mix of
    soldiers, sailors, airmen, and marines in our Armed Forces.

           temporary increase in end strength/guard-reserve missions
        25. Senator Chambliss. Secretary Rumsfeld, I applaud your recent
    decision to float up the Army end strength over the next several years
    in order to better meet the demands being placed on our Armed Forces.
    As I interact with my constituents who are military members it
    continues to become clear to me that they are, overwhelmingly, proud to
    serve their country and willing to do so when called. At the same time,
    they want predictability in their lifestyle and a sustainable
    deployment schedule. The temporary increase you are instituting will
    help spread mobilizations and deployments over more people, and I
    believe that will help relieve some of the strain on our military
    members. Part of your plan for creating a more operational, deployable
    Army is to move people into skill sets that have high demand from those
    that are not in high demand. Regarding how this rebalancing may affect
    the Reserve components, can you explain in more detail which skill sets
    you are talking about and how this shift in skill sets will affect the
    way the Guard and Reserve look and how they are used in the future?
        Secretary Rumsfeld. Specialties such as Civil Affairs, Security/
    Police Forces, Intelligence, and Special Operations Forces are examples
    of the most highly stressed career fields that need rebalancing.
    Converting skills from lower demand areas such as Field Artillery, Air
    Defense Artillery, and Combat Heavy Engineers to these higher stressed
    career fields increases the number of these units. Expanding the
    rotational base allows the Services to achieve mobilization rates that
    are both reasonable and sustainable.

                            guard/reserve retention
        26. Senator Chambliss. Secretary Rumsfeld, our Guard and Reserve
    members have done a great job over the last several years and have
    played a major role in military operations overseas and at home. Based
    on the planned ratio of Reserve to Active Forces in Iraq during OIF 2,
    they will be playing an even larger role in the future. Indications I
    get from Guard and Reserve personnel I've talked to are that we have a
    possible retention crisis brewing. People I've talked to who have been
    deployed or are currently deployed claim that as many as 70 percent of
    the people in their units plan to get out when they are demobilized.
    It's unclear if they actually will, however the fact they say they are
    going to is troubling. The additional feedback I get that I think is
    important to mention is that predictability in lifestyle is more
    important to retaining these people than any kind of pay and benefit. I
    know you and your staff are working right now to revamp the
    mobilization process and develop new standards for how Guard and
    Reserve personnel will be used. But I want you to know that this issue
    is in the forefront of my concern as well and I look forward to seeing
    how DOD will address this issue which I believe is absolutely central
    to the future of our Armed Forces. On that note, I would appreciate any
    preliminary thoughts you have on the standards the Department intends
    to put in place for using and retaining our Guard and Reserve Forces.
        Secretary Rumsfeld. We are acutely aware that the Reserve
    components are being called upon now more than they have in the past,
    and we are concerned about the impact of this increased use on our
    ability to meet our future human resource requirements. It is unclear
    at this point what current and long-term effects this increased use may
    have. While we are currently achieving our strength objectives, we
    remain vigilant about future enlistment and reenlistment behavior and
    trends. In our efforts to strengthen Reserve recruiting and retention,
    the Department is examining proposals for enhanced bonus programs and
    exploring opportunities to improve the quality of life for our members.
    We have stepped up our family and employer support programs, and we
    monitor employer- and family-related issues and concerns for potential
    serious problems. In addition, we are considering a number of
    initiatives that are focused on limiting the personal turbulence for
    our Reserve component members.
        To promote judicious and prudent use of the Reserve components and
    to reduce the strain on Reserve component members, we are focusing much
    of our effort on developing new standards for their use. We are
    exploring policies that will provide more predictable periods of
    mobilization and more advanced planning time for overseas tours. For
    example, a member could plan for not more than 1 year of mobilization
    in every 6 years of Reserve service and arrange his personal and family
    affairs accordingly. We are examining ways to enhance our use of
    volunteers in an effort to minimize the need for involuntary activation
    orders. Additionally, our efforts to prepare proposed legislation and
    revise our policies to support the continuum of service are ongoing.
    These efforts are focused on removing barriers to optimal use of
    Reserve component members across the spectrum of military operations in
    both peacetime and in times of national emergency.
        Although there are no immediate indications that the current
    mobilization has negatively impacted recruiting and retention, we are
    working to identify early warning indicators that will assist us in
    targeting enlistment and reenlistment incentives before problems become
    serious.
        The Secretaries of the military departments are individually
    responsible for determining their strength requirements and skill mix
    and applying available resources to ensure manning requirements are
    achieved. We will continue to work with them to ensure that our
    programs are sufficient to provide a strong force with the requisite
    numbers and skills.

                               strategic airlift
        27. Senator Chambliss. General Pace, strategic airlift has been
    absolutely central to our success in Afghanistan and Iraq over the past
    3 years, and central to the success of the Expeditionary Air Force for
    much longer than that. You are currently in the process of revising the
    Mobility Requirements Study to incorporate lessons learned from
    Operation Enduring Freedom (OEF) and OIF, and I understand that this
    study will be complete by June 2005. However, I don't think it takes a
    complex, time-consuming study to determine that we simply don't have
    enough airlift. We can't build C-17s fast enough and we can't modify C-
    5s fast enough to produce the amount of airlift capability that we
    need. One illustration of this which I find a little troubling is that
    over the last few years DOD has contracted with the Russians to use AN-
    124 aircraft for strategic airlift because we simply don't have enough
    of our own. At the same time, DOD and the Air Force in particular are
    dragging their feet in funding C-5 modernization programs which could
    help alleviate our need to contract with the Russians. I would
    appreciate your comments on this situation as well as your comments on
    how you will fund the C-5 modernization effort in order to increase the
    United States' strategic airlift capacity.
        General Pace. The AN-124 is only used on a limited basis as the
    last option for airlifting outsized cargo. Our preferred method of
    cargo shipment is sealift. Only when the material is needed at
    destination before sealift can get it there, do we resort to airlift.
    Certain large shipments, known as outsized cargo, can only fit on a C-5
    or C-17. The Fly America Act mandates that when the appropriate
    aircraft are not available, we must first offer a contract to U.S./
    Civil Reserve Fleet carriers. However, no U.S. carriers have the
    capability to move outsized cargo. In the past 5 years we have
    contracted the AN-124 125 times, with the vast majority of those
    instances being in fiscal year 2002-2003 as we were building up and
    executing OIF. In fiscal year 2003, the AN-124 flew less than one-half
    of 1 percent of the total strategic airlift missions flown (79 out of
    180,000).
        As part of the C-5 modernization effort, we have funded the
    Avionics Modernization Program (AMP) for 55 aircraft. In fiscal year
    2005, $103 million is included in the President's budget request,
    including funds for procurement of kits for 18 additional aircraft. We
    have also requested $322 million in the fiscal year 2005 budget for the
    Reliability Enhancement and Re-Engining Program (RERP). Three test kits
    (two C-5Bs and one C-5A) were procured in fiscal year 2004 with
    operational test and evaluation scheduled to be complete in fiscal year
    2008. The Air Force has programmed funds for procurement of 12
    additional kits through fiscal year 2009, scheduled to begin as the
    Operational Test and Evaluation ends. Although budgetary constraints
    have delayed this program, we plan to AMP all remaining C-5s in the
    fleet and RERP the required amount to meet mobility requirements.
                                     ______

                Questions Submitted by Senator Lindsey O. Graham
                                tricare funding
        28. Senator Graham. Secretary Rumsfeld, last year, Congress
    appropriated $400 million to the Defense Health Program for an expanded
    TRICARE benefit for reservists and their families. Recognizing your
    reluctance to rely on unnamed sources, I have received information that
    a significant amount of these funds have been expended without program
    implementation. How much of that $400 million remains, and for what
    purpose has the money been used?
        Secretary Rumsfeld. Thank you for your support of our reservists. I
    share your respect and appreciation for their contribution to our
    Nation. Implementing the enhanced access to TRICARE provided to
    reservists by the Fiscal Year 2004 National Defense Authorization Act
    (NDAA) presents the Department with both fiscal and administrative
    challenges.
        As no additional funds were appropriated to support the new
    requirement, a prior approval reprogramming from within the
    Department's current appropriated funds is required. That reprogramming
    action is currently being staffed within the Department and should be
    forwarded to Congress shortly. As an interim measure, costs associated
    with the benefit are being absorbed within funds appropriated to the
    Defense Health Program appropriation as part of the Fiscal Year 2004
    Appropriations Act. Given that the ability to absorb these costs is
    limited, I request your support expediting congressional approval of
    the reprogramming request.
        The enhanced benefit also introduces a number of administrative
    challenges. As sections 703 and 704 of the NDAA for Fiscal Year 2004
    represent the extension of current periods of eligibility, the benefit
    became active and the Department began to incur costs on November 6,
    2003. At that time, the system capability to capture and report actual
    program expenditures did not exist. The Department is aggressively
    pursuing the necessary systems changes and contract modifications to
    properly administer these benefits, but those efforts are not yet
    finalized. As such, actual benefit expenditures are currently not
    available. However, current analysis indicates expenditures through
    March 2004 will be approximately $244 million. This estimate includes
    the provision of health care benefits under section 703 and 704, as
    well as associated system changes and contract modifications.
        Section 702 requires regulatory action which is currently under
    development within the Department. The Department is developing the
    program to ensure administrative and health care costs do not exceed
    the $400 million limit specified by Congress in fiscal year 2004.

        29. Senator Graham. Secretary Rumsfeld, could you please comment on
    the status of the implementation of this vital readiness and retention
    program?
        Secretary Rumsfeld. The Emergency Supplemental Appropriations Act
    and the NDAA for Fiscal Year 2004 temporarily revise statutes governing
    healthcare services for Reserve component (RC) sponsors and their
    family members. We are committed to making these changes as quickly as
    possible to ensure eligible members have access to TRICARE health
    benefits.

             The Department has begun a series of steps to
            implement these new temporary benefits such as changing systems
            and contracts, and developing marketing and educational
            materials to get information out to the RC members and their
            families.
             The law limits the fiscal year 2004 outlays to $400
            million for authorized benefits. The Department is setting up
            systems to accurately track and account for all administrative
            and healthcare costs to stay within this limit.
             Looking to the future, we need to proceed cautiously
            in considering costly new entitlements for reservists who have
            not been activated. A key issue would be the effect of a new
            entitlement on recruitment and retention of both active duty
            and Reserve component members.

                               air national guard
        30. Senator Graham. Secretary Rumsfeld, since the 1950s, the Air
    National Guard has followed a policy of maintaining at least one flying
    mission in every state. This policy is no doubt due to the invaluable
    contributions that the Guard provides not only to the national defense
    but also in recognition of the positive role Guard members play in
    their communities offering most individuals their only exposure to the
    military. Do you intend to continue that longstanding policy?
        Secretary Rumsfeld. I appreciate your long-standing support for our
    Nation's men and women in uniform as well as your concern for the
    continued relevance of our citizen airmen of the Air National Guard.
    The support of Congress will be critical as we transform the DOD to
    meet the national security requirements of the 21st century.
        The Department anticipates an overall reduction in the number of
    manned aircraft as we transform. This is due not only to constrained
    resources, but also the capabilities the Nation will require from the
    Department in the future. Information age warfare requires a different
    portfolio of capabilities than industrial age warfare, and we are
    transforming the joint force to meet that challenge. Also, the aircraft
    the Department is planning on procuring will be vastly more capable
    than our current legacy systems, which will result in a lower number of
    aircraft being procured. The Department is also very interested in the
    potential of unmanned systems.
        The USAF is committed to ensuring the Air National Guard is a full
    and equal partner in the Air Force of the future. I strongly support
    their efforts to ensure the future relevancy of the Air National Guard
    in their transformation plans. Our shift to capabilities based planning
    and the resulting shift in focus away from legacy systems require a
    commensurate change of focus by the Air National Guard. Lieutenant
    General James has developed a strong transformation vision, and I am
    confident that his approach will help to ensure a relevant Air National
    Guard.
        The Air Force and Air National Guard assure me their intent is to
    maintain a Guard flying unit in every state; however, first and
    foremost, they are committed to providing a relevant and more capable
    Air National Guard presence in every state, to provide required
    capabilities to the joint force. While it has always been a goal, there
    is no stated policy to keep a flying unit in each State. The Department
    believes such a policy would not be in the best interests of the
    Nation. The Air Force and Air National Guard leadership require the
    flexibility to transform the Air National Guard to ensure it has the
    required capabilities needed for the future.

                               rebalancing forces
        31. Senator Graham. Secretary Rumsfeld, you mention in your brief
    prepared for Congress the need to manage/reduce the need for Reserve
    mobilization but at the same time you want to ``restructure'' the
    Reserves to serve in more ``high demand'' units such as military
    police. Please comment on your plan to achieve both of these goals.
        Secretary Rumsfeld. The rebalancing strategy has as its objectives:
    to enhance early responsiveness by structuring forces to reduce the
    need for involuntary mobilization during the early stages of a rapid
    response operation; to resolve stressed career fields by structuring
    forces to limit involuntary mobilization to reasonable and sustainable
    rates; and to employ innovative management practices such as the
    continuum of service, reachback, enhanced volunteerism, mobilization
    process improvements, and predictable rotational overseas presence.
    Through this comprehensive rebalancing strategy the Department will
    gain added efficiencies from its existing force structure that may
    preclude any necessity to increase force end strength. For example, the
    Army's rebalancing plans will convert lower priority, less stressed
    field artillery force structure to higher priority and higher demand
    military police. This will increase the number of both active and
    Reserve component military police units. Expanding the rotational base
    allows the Services to achieve mobilization rates that are both
    reasonable and sustainable.

        32. Senator Graham. Secretary Rumsfeld, it was mentioned in the
    budget brief that, contrary to what has been reported, Army end
    strength numbers are not going to be temporarily increased; instead,
    active duty personnel are going to be ``restructured.'' Who will
    replace those active duty positions that are being restructured?
        Secretary Rumsfeld. The President has authorized the Army to
    temporarily increase active component strength by 30,000, using
    emergency powers provided in statute, for the purpose of resetting the
    force and creating 10 additional brigade UAs to address demands on the
    force based on current global war on terrorism emergency operations.
    The Army will increase its strength by up to 30,000 over the next 4
    years and then return to statutory limits provided in the NDAA. It will
    employ a number of methods to return to the prescribed statutory
    limits. These methods include restructuring of ``Cold War''
    capabilities deemed unnecessary or excessive for the emerging strategic
    environment, converting selected military spaces to civilian spaces in
    the institutional force, and headquarters delayering to provide more
    soldiers in deployable units. The exact number of spaces to be
    restructured is still under review. The spaces for ``Cold War''
    capabilities that are no longer needed are being reinvested to create
    brigade UAs and associated support elements. Spaces in the
    institutional force that can be converted to civilian positions will be
    filled through the hiring of general schedule civilians or contractors.

                         military retention/recruiting
        33. Senator Graham. Secretary Rumsfeld, in your opinion, what
    effect will the lack of targeted pay raises have on military retention
    in light of an improving economy and the current strain on military
    forces?
        Secretary Rumsfeld. In my opinion, the lack of targeted pay raises
    will not adversely affect retention. The proposed 3.5 percent pay raise
    is one-half percent greater than the average pay raise in the private
    sector. When we also consider that the Basic Allowance for Housing, for
    some members about one-third of their regular military compensation,
    increased 6.9 percent and the Basic Allowance for Subsistence rose 4.8
    percent, military compensation growth was significantly higher than for
    the average civilian.

        34. Senator Graham. Secretary Rumsfeld, what effect do you believe
    the current stop losses will have for long term recruiting and
    retention goals?
        Secretary Rumsfeld. I believe the current Stop Loss program will
    have minimal effect on long-term recruiting goals. The current Stop
    Loss program is small in scale, impacting approximately 45,000 (as of
    the end of January 2004) out of the 2,000,000 active and Reserve
    Service members. As of today, the Army is the only Service currently
    executing stop loss. Army Stop Loss programs are expected to remain in
    effect until their unit stabilization system and increased manning
    initiatives are fully realized in 3 to 4 years. We are closely
    monitoring retention rates. When we ask the force about their
    intentions to stay in uniform, the signals remain positive.

                                stockpile report
        35. Senator Graham. Secretary Rumsfeld, over the last several
    years, the Senate has supported a number of Department of Energy (DOE)
    programs essential to the Nation's nuclear deterrent force. Many of
    those programs support DOD as the end ``customer.'' When do you intend
    to finalize the Stockpile Report?
        Secretary Rumsfeld. We are currently conducting a periodic review
    of our plans for implementing the Nuclear Posture Review. The updated
    plans will serve, among other things, as the means to change the
    projection of our specific stockpile requirements. We will make a two-
    thirds reduction in number of our operationally deployed nuclear
    weapons that President Bush has announced. The plan must also protect
    against a number of unknowns in the 2012 timeframe and beyond,
    including the international environment, the limited progress we have
    made toward restoring our nuclear infrastructure, and the condition of
    the aging stockpile. Infrastructure is of particular concern, since the
    U.S. cannot build complete replacement warheads or build new ones from
    scratch if it were required to do so. Because of this and other
    infrastructure shortfalls, we must rely on those warheads we have in
    secure storage to respond to new threats by incorporating new
    technology into these existing warheads when required.
        Nearly all of the weapons in the stockpile were designed and built
    during the Cold War. For now, our plan is to retain some, explore
    modifications of others to give them improved capabilities, and to
    prudently reduce the overall inventory of warheads. Predicting specific
    stockpile requirements that will meet our deterrence needs for the next
    decade and beyond, is a very complex problem. This initial stockpile
    plan for 2012, now in development, will involve significant reductions.
    We will continue to refine our requirements in the future taking into
    account progress made in restoring the nuclear infrastructure and the
    condition of the stockpile.
                                     ______

                 Questions Submitted by Senator Elizabeth Dole
                                 transformation
        36. Senator Dole. General Pace, in a recent article in the National
    Journal, the operational linking of individual Service training ranges
    at Nellis, the National Training Center, Twentynine Palms, and San
    Diego was hailed as one of the greatest transformation achievements
    stemming from operations in Iraq. Where do you see further
    ``transformational'' opportunities emerging in joint training and
    operations?
        General Pace. While the Joint National Training Capability (JNTC)
    has demonstrated initial success in providing a capability to conduct
    joint training at a collective level, we are also making strides to
    develop an enhanced capability to provide distance learning and
    training at an individual level. This capability is referred to as the
    Joint Knowledge Development and Distribution Capability (JKDDC).
        JKDDC will transform the way our joint military forces receive
    joint individual training. Through this capability we will develop and
    distribute joint knowledge via a dynamic, global-knowledge network that
    provides immediate access to joint education and training resources.
    This capability facilitates a transformed culture by preparing future
    decisionmakers and leaders (officers, enlisted, and DOD civilians
    across the joint community) to employ joint operational art, understand
    joint doctrine, and respond innovatively to adversaries.

                             rebalancing the forces
        37. Senator Dole. General Pace, while end strength is certainly an
    area of concern, I am more concerned about force mix particularly, the
    total force of active, Reserve and Guard. How are you addressing the
    short-term issue of manning high demand career fields?
        General Pace. The Services are taking a number of actions to reduce
    stress on high demand career fields beginning in fiscal year 2004-2005.
    Generally, they will move force structure from high-density, low-demand
    capabilities (air defense and artillery) into high-demand capabilities
    (military police and civil affairs).
        The Army will begin the restructuring of 40,000 billets in fiscal
    year 2004-fiscal year 2005. This includes beginning realignment of
    30,000 billets in fiscal year 2004--affected career fields include
    Civil Affairs, Psychological Operations, Chemical Defense, Special
    Operations Forces, Intelligence, and Military Police. Realignment of
    the remaining 10,000 billets will begin in fiscal year 2005 affected
    career fields include Military Police, Transportation, and
    Quartermaster.
        The Navy will complete realignment of over 14,600 billets by fiscal
    year 2005 in its Antiterrorism/Force Protection, Intelligence, and
    Medical career fields. Additionally, the predominantly RC Naval Coastal
    I Warfare capability will gain active component structure: (1) four
    active component Maritime Security Force Squadrons will be commissioned
    by end fiscal year 2004; and (2) two of eight RC Naval Coastal Warfare
    Squadrons transfer to AC in fiscal year 2005.
        The Air Force will realign 3,800 billets in fiscal year 2004-fiscal
    year 2005. This includes 2,700 billets in the highly stressed Special
    Operations career field and 1,100 across 16 other stressed AC career
    fields.
        The U.S. Marine Corps will realign billets in Air/Naval Gunfire
    Liaison Companies and examine further rebalancing efforts for Law
    Enforcement, Civil Affairs, and Intelligence. In fact, three Air/Naval
    Gunfire Liaison Companies will be established resulting in a 54/46 AC/
    RC mix of forces in a capability that was previously 100 percent in the
    RC.

        38. Senator Dole. General Pace, in your proposal to reassign some
    units (namely air defense and artillery) to units such as military
    police and civil affairs, are we sacrificing a capability of a core
    mission in order to meet a short-term requirement?
        General Pace. We are not sacrificing a capability of a core mission
    in order to meet short-term requirements. The rebalancing efforts by
    the Services are the result of detailed analysis. In general, the
    Services will move force structure from high-density, low-demand
    capabilities (air defense and artillery) into high-demand capabilities
    (military police and civil affairs).

        39. Senator Dole. General Pace, could you discuss in further detail
    how you plan to rebalance the forces between the active, Guard, and
    Reserve components?
        General Pace. The Services are taking a number of actions, in
    addition to those already mentioned for the near-term, to rebalance
    forces between the AC and RC to better match the force structure to the
    Defense Strategy.
        The Army will realign up to an additional 85,000 billets beginning
    in fiscal year 2006 upon the completion of the Total Army Analysis 06-
    11. This is in addition to the 40,000 billets that will begin
    realignment in fiscal year 2004. The primary capabilities affected will
    be: (1) significant decreases in Field Artillery, Air Defense,
    Engineers, and Armor; and (2) significant increases in Military Police,
    Transportation, Petroleum, Oils, and Lubricants/Water Distribution,
    Civil Affairs, Psychological Operation, and Chemical Defense.
        Other actions by the Services that will affect the AC/RC include:

            --  All Services will increase the use of ``reach-back''
            capabilities, particularly in the Medical and Intelligence
            career fields, in order to reduce the deployment requirements
            for high-stressed RC career fields;
            --  The U.S. Navy (USN) and USMC will integrate AC/RC F/A-18
            units to improve overall carrier air wing availability and
            reduce reliance on one component or the other, exclusively;
            --  The Air Force will reduce reliance on the RC by 24 percent
            over the FYDP through AC/RC realignment in the highly stressed
            career fields of Combat Search and Rescue (CSAR) helicopters
            and the C-130s that refuel the CSAR helicopters.

                       mobilization of the national guard
        40. Senator Dole. General Pace, with this month's deployment of
    North Carolina's 30th Heavy Enhanced Separate Brigade, I have been made
    painfully aware of some of the problems faced by our National Guard
    (NG) units as they mobilize. What are you doing to guarantee that these
    service members are expediently transitioned to active duty payrolls
    and that their lodging and subsistence are of the same quality as the
    active units training on the same bases?
        General Pace. For pay and lodging and subsistence, we are doing the
    following:

              Pay. Since the mid-1990s, mobilized Army National Guard
            (ARNG) soldiers remain on the Defense Joint Military Pay System
            (DJMPS) and are not rolled over to the active component (AC)
            pay system. When an ARNG soldier is mobilized, the NG United
            States Property and Fiscal Officer (USPFO) issues a pay order
            which establishes entitlements using an AC accounting
            classification; thereby, transitioning the soldier to active
            duty.
              Problems arise when an ARNG soldier reports to an AC Finance-
            Office with a pay concern, as the AC is not familiar with the
            DJMPS-RC system. However, the U.S. Army Finance Command in
            conjunction with the Defense Finance and Accounting System
            established RC training teams to conduct training at various AC
            installations on the DJMPS-RC. In addition, the ARNG has
            implemented a toll-free number and set up an email address for
            ARNG soldiers to use when they have questions or concerns
            regarding their pay. Also, three ARNG Mobilization Pay Teams
            (MPTs) are being organized to identify and make necessary pay
            adjustments and corrections. The toll-free number and email
            address were operational March 1, 2004, and the MPTs should be
            operational April 1, 2004.
              Lodging and Subsistence. The Army has experienced significant
            challenges in billeting mobilized soldiers. In response, the
            Installation Management Agency (IMA) has created a standard
            policy for all installations to use when accommodating
            mobilized soldiers regardless of component affiliation. This
            standard is based on the fundamental principle that AC and RC
            soldiers are on one team and are to be treated equally within
            the installation's capabilities.

        41. Senator Dole. General Pace, the budget request news release
    sent out by your office proposes the use of innovative management to
    improve the mobilization process. Could you go into some specifics
    about that objective?
        General Pace. In order to relieve stress to the RC force, we are
    evaluating several innovative management practices to improve the
    flexibility of the total force. We also want to reduce the impact on
    critical career fields in the RC and the need for involuntary
    mobilization. Our four approaches include: establish the paradigm of
    the continuum of service, increase use of reachback, improve
    predictability of rotational overseas presence, and improve the
    mobilization process.
        The paradigm of the continuum of service is a new practice that
    provides individual service members greater opportunities to serve in
    support of the Department's mission. Currently, the RC force is made up
    of either full-time or traditional reservists. With the new approach,
    RC individuals will be able to perform military service in a variety of
    ways, at varying levels of service, moving between full-time and part-
    time status, as circumstances in their lives and needs of the
    Department evolve.
        Increased use of reachback refers to the ability to connect
    electronically to information sources and resources at home base or
    other locations around the world to accomplish essential tasks and
    missions. By employing reachback, the in-theater force can be smaller
    and more agile, with corresponding reductions in combat support and
    physical security requirements. Additionally, by using computer
    connectivity, RC units and individuals can provide mission support
    during drill periods as well as short-rotation active duty tours, thus,
    further lessening the requirements for RC mobilizations.
        Improving the predictability of rotational overseas presence allows
    longer lead-time to plan for overseas deployment. RC members benefit
    from additional time to prepare their families, employers, and train
    with their units. Incorporating RC forces into a more predictable
    rotational overseas presence plan also allows the Department to free up
    active component units to support rapid-response requirements that may
    arise, and the Services are able to better manage the operational tempo
    of the total force.
        Improvements to the mobilization process include: establishing
    standards to ensure judicious and prudent use of the RC, gaining better
    access to the Individual Ready Reserve pool (for greater source of
    military manpower and depth of capabilities), and continuing Service
    refinements to automation systems, thus, enhancing visibility of
    activated RC members and improving the ability to meet mobilization
    requirements.

        42. Senator Dole. Secretary Rumsfeld, since September 11, 2001, 21
    North Carolina NG units have been mobilized. Of those, only one unit
    was given anywhere close to a 30-day notice. With the announcement of
    the OIF 2 rotation, the 30th Heavy Enhanced Separate Brigade received
    their orders 4 days prior to their mobilization date. While I
    understand the urgent requirements immediately following September 11,
    this holding of notice orders for an anticipated rotation is
    unacceptable, especially given the additional preparations required for
    our citizen soldiers. What is being done to address this ongoing
    problem?
        Secretary Rumsfeld. The 30th Enhanced Separate Brigade alert order
    was released by Headquarters, Department of the Army on July 25, 2003.
    The 30th Enhanced Separate Brigade mobilization order was released by
    Headquarters, Department of the Army, on September 27, 2003, with a
    mobilization date of October 1, 2003. While it is the Army's policy to
    issue mobilization orders 30 days prior, operational requirements
    sometime dictate otherwise. While it was unfortunate that it was only 4
    days from mobilization order receipt to report for duty, it did allow
    for the soldiers families to become eligible for the benefits and
    entitlements that come with activation, such as medical care, dental
    care, and lower interest rates for loans. It is the Department's policy
    to ensure the predictable use of Reserve Forces shall be extended to
    the maximum amount possible by notifying Reserve members early that
    they are being considered for activation and by issuing orders as soon
    as it is operationally feasible to do so with the goal of providing
    them to the activating member at least 30 days prior to the report
    date.

                        brac/guard and reserve training
        43. Senator Dole. Secretary Rumsfeld, with the proposed 25 percent
    reduction in domestic facilities with BRAC and movement away from
    large, forward-operating bases, how are you planning to accommodate
    Guard and Reserve training, basing, and quality-of-life needs when
    worldwide operations require a manpower ``spike''?
        Secretary Rumsfeld. The Department of Defense is committed to
    meeting the quality-of-life needs of our service members and their
    families as we transform our military for the 21st century. Just as our
    forces are dealing with the global war on terrorism, so too, are our
    military families. We have the honor and the obligation to assist them
    in meeting the stresses and challenges of military life. Because of the
    unique challenges of our times, we formed a Joint Family Readiness
    Working Group in October 2002. The working group is critical in the
    Department's efforts to monitor deployment and family readiness and
    serves as an advisor to DOD leadership on emerging policy and
    operations issues.
        Each of the military services has comprehensive deployment support
    programs. These programs educate families and help them cope with the
    demands of military life and separations. Outreach efforts include
    personal contact with families on a regular basis. Through technology
    (toll-free numbers, Military OneSource, and Web sites), families can
    access information or link to services virtually around the clock.
    Personal services include emergency assistance, respite care for
    children, financial assistance, and help in navigating military
    systems.
        The military family lives with a high level of stress not only
    because of frequent deployments that place the service member/parent/
    spouse in harm's way, but also because of frequent moves, disruptions
    in the military spouse's employment, and the challenges created by
    children changing schools. The OneSource program is a primary means of
    support to families dealing with these challenges, especially the two-
    thirds who live off-base and the 60 percent with family
    responsibilities. Through the Military OneSource programs, service
    members and their families can also access prepaid nonmedical family
    assistance counseling to help them deal with deployment separations,
    parent-child communication, financial issues, and reunion/reintegration
    issues.
        Our service members have strong family values and high aspirations
    and expectations for their quality of life. To that end, the
    Department, in its new social compact, has entered into a written
    commitment to improve life in the military, underwrite family support
    programs, and work in partnership with families to accomplish the
    military mission. Family support is a continuous effort, and there is
    no finish line for readiness.
        As we continue to support our Active and Reserve Forces and their
    families, we are closely monitoring our programs so that resources are
    available and accessible to all affected by mobilization and
    deployment. We are being particularly vigilant and supportive of our
    family readiness volunteers. They do a superb job and are an incredible
    group of dedicated and effective volunteers.

        44. Senator Dole. Secretary Rumsfeld, while I understand the
    temporary nature of many of the facilities now housing our Guard and
    Reserves units training for deployment, the deplorable state of those
    facilities is not understandable. How will remedying this situation be
    factored into the considerations for the 2005 BRAC round?
        Secretary Rumsfeld. As the Department rationalizes its base
    infrastructure with defense strategy through the BRAC process, excess
    base capacity can be eliminated. This will release scarce resources
    that would otherwise not be available for other higher-priority
    requirements, such as modernizing weapons, improving quality of life
    for military members, and improving the readiness of our forces by
    upgrading the facilities that support them. To the extent funding can
    be diverted from unnecessary facilities through BRAC, the facilities
    you mention could be improved.

                      transformation and postwar stability
        45. Senator Dole. Secretary Rumsfeld, while our latest military
    innovations have been significant in ``winning the war,'' we seem to
    have a ways to go in ``keeping the peace.'' How does your
    transformation vision address the need to maintain a postwar stability
    operation or peacekeeping capability?
        Secretary Rumsfeld. Our vision of transformation encompasses
    developing new concepts for the employment of military force across the
    range of military operations, from major force-on-force combat to
    stability operations. To support this vision, the Joint Staff,
    combatant commands, and the military services are developing future
    joint concepts that will support our operational goals as laid out in
    the 2001 Quadrennial Defense Review. For example, the April 2003
    Transformation Planning Guidance included specific guidance on
    developing a joint operating concept (JOC) for stability operations,
    with particular emphasis on peace enforcement. That JOC is now under
    development and is expected to be completed soon. To make the concept a
    reality, the military will conduct experiments and wargames to ensure
    the force adopts the new concept. Such transformational capabilities
    are critical to adapting our forces' combat capabilities into useful
    tools for resolving crisis situations. In addition, we continue to work
    with our friends and Allies to increase global capacity to conduct
    stability operations and to develop policies, concepts, and doctrines
    that ensure we can operate together effectively during stability
    operations.

                         welfare of the military family
        46. Senator Dole. Secretary Rumsfeld, the welfare of the military
    family is undoubtedly a key to the success of our All-Volunteer Force.
    I would like to take this opportunity to thank the countless volunteers
    and military family advocacy employees for their dedicated work during
    OEF and OIF. How is DOD formalizing the family advocacy mission, and
    how is this mission included in you transformation vision?
        Secretary Rumsfeld. The Department of Defense is committed to
    meeting the quality of life needs of our service members and their
    families as we transform our military for the 21st century. Just as our
    forces are dealing with the global war on terror, so too, are our
    military families. We have the honor and the obligation to assist them
    in meeting the stresses and challenges of military life. Because of the
    unique challenges of our times, we formed a Joint Family Readiness
    Working Group in October 2002. The working group is critical in the
    Department's efforts to monitor deployment and family readiness and
    serves as an advisor to DOD leadership on emerging policy and
    operations issues.
        Each of the military services has comprehensive deployment support
    programs. These programs educate families and help them cope with the
    demands of military life and separations. Outreach efforts include
    personal contact with families on a regular basis. Through technology
    (toll-free numbers, Military OneSource and Web sites), families can
    access information or link to services virtually around the clock.
    Personal services include emergency assistance, respite care for
    children, financial assistance, and help in navigating military
    systems.
        The military family lives with a high level of stress not only
    because of frequent deployments that place the service member/parent/
    spouse in harm's way, but also because of frequent moves, disruptions
    in the military spouse's employment, and the challenges created by
    children changing schools. The OneSource program is a primary means of
    support to families dealing with these challenges, especially the two-
    thirds who live off-base and the 60 percent with family
    responsibilities. Through the Military OneSource programs, service
    members and their families can also access pre-paid non-medical family
    assistance counseling to help them deal with deployment separations,
    parent-child communication, financial issues and reunion/reintegration
    issues.
        Our service members have strong family values and high aspirations
    and expectations for their quality of life. To that end, the
    Department, in its new social compact, has entered into a written
    commitment to improve life in the military, underwrite family support
    programs, and work in partnership with families to accomplish the
    military mission. Family support is a continuous effort and there is no
    finish line for readiness.
        As we continue to support our Active and Reserve Forces and their
    families, we are closely monitoring our programs so that resources are
    available and accessible to all affected by mobilization and
    deployment. We are being particularly vigilant and supportive of our
    family readiness volunteers. They do a superb job and are an incredible
    group of dedicated and effective volunteers.

        47. Senator Dole. Secretary Rumsfeld, given that our current
    deployments are drawing heavily on Guard and Reserve Forces, what is
    the Department doing to ensure necessary and appropriate support for
    all families, especially those from rural communities who live long
    distances from military installations?
        Secretary Rumsfeld. We have been working with the Services and the
    RCs to create more of a joint service, total force family readiness and
    support perspective, so that any member or family can go to any
    installation or family support group and receive the assistance they
    need, regardless of the Service or component affiliation of the member.
        Family readiness is a command function that must start at the
    battalion/squadron level. The unit commander is in the best possible
    position to determine what is needed to support his or her unit members
    and their families. Thanks to the National Guard Bureau, over 400
    family assistance centers have been brought online to augment the
    family support system in America's hometowns in support of mission
    readiness. These joint centers provide an outreach capability not only
    to Guard and Reserve families that are not located near an
    installation, but they also support the large number of active service
    and family members who reside off the installation. Combined with the
    active duty family centers, there are over 700 family assistance
    centers around the world.
        Through technology (toll-free numbers, Military OneSource, and Web
    sites), families can access information or link to services around the
    clock. We have been extremely pleased with the success of the OneSource
    program. This program offers service members and their families, from
    any location in the world, 24 hours a day, 7 days a week, access to a
    professional counselor via a toll-free telephone line, the Internet,
    and e-mail. The program offers the service in more than 130 languages.
    Personal services include emergency assistance, respite care for
    children, counseling, financial assistance, or help in navigating
    military systems. In addition, military members and their families can
    access prepaid family assistance counseling services on issues ranging
    from parent-child communications to reunion/reintegration of the family
    following deployments. A licensed provider provides this counseling
    within 30 minutes of the military family's home.
        The military family lives with a high level of stress not only
    because of frequent deployments that place the service member/parent/
    spouse in harm's way, but also because of frequent moves, disruptions
    in the military spouse's employment, and the challenges created by
    children changing schools. The OneSource program is a primary means of
    support to families dealing with these challenges, especially the two-
    thirds who live off-base and the 60 percent with family
    responsibilities.
        Our service members have strong family values and high aspirations
    and expectations for their quality of life. To that end, the
    Department, in its new social compact, has entered into a written
    commitment to improve life in the military, underwrite family support
    programs, and work in partnership with families to accomplish the
    military mission. The OneSource program leverages the power of public-
    private partnerships and technology to deliver services.

        48. Senator Dole. Secretary Rumsfeld, what is the Department doing
    to facilitate coordinated, targeted support for these troops and their
    families from local community resources, like schools, churches, and
    public agencies?
        Secretary Rumsfeld. The National Guard Family Assistance Centers,
    located at over 400 sites in communities throughout the country, work
    with local agencies to ensure support is made available to military
    families. Moreover, the Family Centers at the installation have always
    worked with the local public agencies to ensure military families
    receive the appropriate support for which they are eligible. A number
    of veteran service organizations have also stepped up to the plate and
    are assisting families whose loved ones are deployed with home repairs,
    cars, lawn mowing, and other tasks that the deployed service member did
    while at home. The community response to our military families has been
    and continues to be very inspiring.
        The family support systems at the installation level work with the
    schools to ensure that their staffs are aware of the unique needs of
    military children and, in particular, students with a parent deployed.
    Family Center staff and School Liaison Officers work regularly with the
    local schools providing training and other resources to help them
    assist military children.
        Military OneSource, our recently implemented toll-free telephonic
    information and referral service links military families directly to
    local civilian community services. Military OneSource verifies
    referrals and frequently conducts a three-way call to introduce the
    military family to community service providers. In addition, families
    can access prepaid nonmedical family assistance counseling, provided by
    local civilian counselors, through the Military OneSource program.
        I am pleased to recount a number of initiatives: for example, DOD
    sponsors www.MilitaryStudent.org, a Web site designed for children and
    parents of military families on deployment, their teachers, military
    installation leaders and families of special needs. The Web site is an
    extensive collection of information, skills, and strategies to help
    students and their families address deployment challenges as well as
    information and suggestions for those in support roles.
        We help educators become aware of the challenges of the military
    child. To foster national awareness and highlight best practices for
    public school and military leaders, the DOD and the Military Impacted
    Schools Association (MISA) sponsored the National Conference for the
    Military Child. An outgrowth of the conference was the Promising
    Practices Program, which promotes worldwide replication of school
    programs and policies that schools can emulate for the benefit of
    military children and is located on the DOD Web site,
    www.MilitaryStudent.org.
        The Department has initiated several partnerships. A partnership
    with the Department of Education's Safe and Drug Free Schools has
    expanded to include work with the National Child Traumatic Stress
    Network (sponsored by the University of California, Los Angeles, Duke
    University, and the Department of Health and Human Services) and world-
    renowned trauma experts to develop publications such as: ``Educator's
    Guide to the Military Child During Deployment'' and ``Educator's Guide
    to the Military Child During Post Deployment: Challenges of Family
    Reunion.'' In addition, Parent's Guide to the Military Child in
    Deployment has been written in collaboration with the same agencies. A
    partnership with child psychologists and the Child Study Center of New
    York University School of Medicine has made their outstanding
    guidebook, Caring for Kids After Trauma and Death: A Guide for Parents
    and Professionals, available on our www.MilitaryStudent.org Web site
    where the DOD publications mentioned above also reside.
        A partnership with Generations United is allowing the DOD to work
    with a nonprofit organization to develop a literacy tutoring program
    for children of deployed military families by training retired military
    members to offer educational and emotional support on a one-to-one
    basis. It will be piloted in six heavily impacted public school
    districts. In addition, the National Child Traumatic Stress Network and
    DOD are working with Walter Reed Army Medical Center and the Veterans
    Administration to develop a program to work with children of severely
    wounded military members returning from Iraq and Afghanistan to help
    children comprehend the life-altering changes of the military member
    and the impact on the family.
        To give national prominence to military child education issues and
    to encourage states to work together to solve many of the challenges of
    military children in transition and deployment, DOD is sponsoring the
    National Education Consortium of Highly-Impacted States. It will be
    held in Washington, DC, in 2004 and attended by Chief State Schools
    Officers of the most heavily impacted military states. The agenda
    includes discussion regarding reciprocity and legislative initiatives,
    establishment of partnerships, and future consortium plans.

        49. Senator Dole. Secretary Rumsfeld, does the Department play a
    direct role in helping these types of organizations help our troops and
    families, or are we merely assuming that they are all doing their part
    to support military families? What type of feedback are you receiving?
        Secretary Rumsfeld. In October 2002, we established a Joint Service
    Family Readiness Working Group. This working group has family program
    representatives from all active and Reserve components, nonprofit
    organizations such as the Red Cross, the National Military Family
    Association, and relevant Federal agencies such as, the Department of
    Veterans Affairs. This group casts a wide net of information gathering
    from their field programs and offices. Through this we get a great deal
    of feedback. I am pleased that the feedback indicates a great deal of
    community support for our military families.
        Family support leaders conduct site visits to highly impacted
    areas. The visits are intended to get a pulse of family and community
    support operations. During these visits, they meet with families,
    family readiness group leaders, and family support staff. Leaders come
    back from these trips impressed with the strength of our family support
    infrastructure but also with the incredible amount of community support
    for our troops and their families.
        We work closely with the President's USA Freedom Corps to provide a
    means of channeling public service to military communities and
    individuals in need. Industries, not-for-profit organizations, schools,
    and individuals have rallied to support our troops and their families
    in countless ways from repairing cars to providing respite care.
        The DOD plays an active role in partnerships with many
    organizations. We are not only the beneficiaries of the efforts of not-
    for-profit organizations, we are also active participants. With the
    MISA, for example, we contribute publications, Web site information,
    and programs that can benefit schools highly impacted by our children
    of military families. We have hired outstanding educators, researchers
    and child psychologists to develop an on-line course that educators
    anywhere in the world can access for free. The course contains cutting
    edge strategies, research, and teaching and counseling techniques that
    will help to support our military children.
        Military OneSource is a success story for us. We constantly receive
    feedback from our service members that our 24/7/365 information and
    referral service for our military families is providing a much needed
    support function, everything from locating a dentist for their autistic
    child to providing school district information for family relocation.
    In addition, military members and their families can access prepaid
    family assistance counseling services on issues ranging from parent-
    child communications to reunion/reintegration of the family following
    deployments. A licensed provider provides this counseling within 30
    minutes of the military family's home. Military OneSource tracks the
    requests from military members and gives us constant feedback regarding
    concerns and needs of our families. This invaluable information is used
    to guide our decisions regarding new programs, policies, and procedures
    necessary to improve military family quality of life.

            guard and reserve activations/separation from businesses
        50. Senator Dole. Secretary Rumsfeld, many of our Guard and Reserve
    personnel either work for a small business or actually run their own
    small business. Given the historic magnitude of current Guard and
    Reserve activations and the substantial economic implications
    associated with these activations, could you outline for the committee
    how the Department is preparing these business owners and employees for
    separations that could last 12 to 18 months, both before they leave and
    after they return?
        Secretary Rumsfeld. Employer support is an important part of an
    individual's decision to remain in the Reserves under normal conditions
    and is even more important in a time of mobilization when employees are
    absent from their employers for more extended periods. Absences by
    reservist-employees may create work problems and increased costs for
    civilian employers and may significantly affect the operations of a
    self-employed reservist's business. Employers of America's NG and
    Reserve members have become inextricably linked to a strong national
    defense.
        The Department chartered the National Committee for Employer
    Support of the Guard and Reserve (ESGR), an agency within the Office of
    the Assistant Secretary of Defense for Reserve Affairs, in 1972 to
    promote cooperation and understanding between Reserve component members
    and their civilian employers and to assist in the resolution of
    conflicts arising from an employee's military commitment. Today, ESGR
    operates through a network of more than 4,500 volunteers throughout 55
    committees located in each State, the District of Columbia, Guam,
    Puerto Rico, the Virgin Islands, and Europe. The Department tasks ESGR
    to ``. . . promote both public and private understanding of the
    National Guard and Reserve in order to gain U.S. employer and community
    support through programs and personnel policies and practices that
    shall encourage employee and citizen participation in National Guard
    and Reserve programs.''
        ESGR uses the military chain of command to promote better
    understanding of the importance of maintaining positive working
    relations between employers and their RC employees, in order to sustain
    NG and Reserve participation. ESGR also solicits the assistance of
    military agencies, military training schools, and military and civilian
    associations in educating the Reserve Forces about their rights and
    responsibilities regarding terms and conditions of civilian employment,
    as stipulated in the Uniformed Services Employment and Reemployment
    Rights Act (USERRA).
        Congress also provided clear protection for all members of the
    uniformed services (including noncareer NG and Reserve members, as well
    as active duty personnel) in October 1994, with passage of the USERRA
    chapter 43 of title 38, U.S. Code. The Department of Labor is the
    enforcement authority for USERRA, and it processes all formal
    complaints of violations of the law. The Act seeks to ensure that
    members of the uniformed Services are entitled to return to their
    civilian employment upon completion of their service. They should be
    reinstated with the seniority, status, and rate of pay they would have
    obtained had they remained continuously employed by their civilian
    employer. The law also protects individuals from discrimination in
    hiring, promotion, and retention on the basis of present and future
    membership in the armed services.
        There is a difference between the reservist who is self-employed
    and chooses to also pursue a military career in the Guard or Reserve,
    and the small business owner who employs a reservist who is called up
    for an extended period of time. About 15 percent of employed reservists
    are either small business owners, manage or work in a family owned
    business, or have their own professional practice. About 18 percent are
    employed by small businesses (firms with fewer than 100 employees). The
    Small Business Administration (SBA) advises small business owners, and
    small businesses with essential employees who are members of the
    Reserve or NG to have a plan in place to work through any potential
    disruption that may result from a broad call-up to active duty. The SBA
    Office of Veterans Business Development has created a new Web site
    where small business owners or small businesses with key employees who
    are members of the Reserve or NG can find relevant information. The Web
    site is part of a comprehensive plan to provide members of the NG and
    Reserve who own or are an essential employee of a small business with
    timely information on all SBA programs and services available to them
    if and when they are called to active duty.
        Through a vast array of programs and services, the U.S. SBA
    provides tools to assemble and enact a plan designed to prevent or
    reduce the potential disruption caused a business by the sudden absence
    of a key player. The SBA and its resource partners offer managerial,
    technical, and financial assistance, counseling, and training to assist
    small businesses with any conceivable business-related issue, from how
    to market their products and services, to financial assistance, to what
    to do if called to active duty.
        Additionally, the SBA has implemented the Military Reservist
    Economic Injury Disaster Loans (MREIDL) program. Small Businesses may
    qualify for MREIDL, the purpose of which is to provide funds to
    eligible small businesses to meet its ordinary and necessary operating
    expenses that it could have met, but are unable to meet, because an
    essential employee was ``called-up'' to active duty in their role as a
    military reservist. These loans are intended only to provide the amount
    of working capital needed by a small business to pay its necessary
    obligations as they mature until operations return to normal after the
    essential employee is released from active military duty. Interest
    rates are determined by formulas set by law and recalculated quarterly
    but the maximum interest rate for this program is 4 percent. Loan terms
    up to a maximum of 30 years are available, and SBA determines the term
    of each loan in accordance with the borrower's ability to repay. The
    actual amount of each loan is limited to the actual economic injury as
    calculated by SBA, not compensated by business interruption insurance
    or otherwise, and beyond the ability of the business and/or its owners
    to provide. If a business is a major source of employment, SBA has
    authority to waive the $1,500,000 statutory loan limit.
        Little data is available on the actual or specific employer costs
    associated with Reserve employees. To address this lack of information,
    the Department is conducting a study to determine if and when
    significant problems with employer support of the Guard and Reserve
    arise due to RC call-ups or other reasons. The Department is also
    collecting information about the costs that mobilizations impose on
    employers of RC personnel and to evaluate various approaches of
    offsetting those costs. Also, last July the Secretaries of Defense and
    Labor signed a Memorandum of Understanding that provides the framework
    for a broad range of continuing and new partnership efforts between the
    two departments to ease reentry into the civilian workforce and ensure
    military skills are translated into civilian employment.

                             military intelligence
        51. Senator Dole. Secretary Rumsfeld, in recent interviews, Dr.
    David Kay, the former head of the ISG, stated that the CIA became far
    too dependent on spy satellites and intercepted communications. This
    statement concerns me, especially as we move to ``transform'' the
    military aspects of the intelligence community. I was, however,
    encouraged to see the DOD's initiative to improve human intelligence
    collection mentioned as part of the budget request. Could you discuss
    in more detail how you plan on balancing technology-based intelligence
    data with the necessary elements of human intelligence and data
    analysis?
        Secretary Rumsfeld. Our efforts to balance technology-based
    intelligence data with human intelligence (HUMINT) reform began in 2003
    with a broad-based, 4-month study entitled ``Taking Stock of Defense
    Intelligence'' and a simultaneous initiative to reform HUMINT. Based on
    on-site research and discussion with every COCOM, Service, and Combat
    Support Agency, the ``Taking Stock'' study yielded a comprehensive
    account of intelligence issues and shortfalls, including the need for
    more and better HUMINT. Concurrently, as we strove to reform our HUMINT
    activities, we also uncovered numerous unaddressed problems in other
    areas: analysis, horizontal integration, dissemination, training, and
    professional development--to name a few. Thus, it became clear to us
    that broad-based changes are needed in the way we conduct defense
    intelligence activities. We are now engaged in a comprehensive
    remodeling effort for all of defense intelligence, which will address
    many, if not most of these problems, balance HUMINT and technical
    collection, provide robust support to the warfighter, and serve the
    greater needs of the DCI and the National Intelligence Community.

                              reserve mobilization
        52. Senator Dole. Secretary Rumsfeld, one of your proposals to
    manage demand placed on our military forces is rebalancing the forces
    to reduce the need for Reserve mobilization. Within the context of
    today's extended rotations, this appears to be a prudent measure;
    however, there may be a long-term implication to address. Having a
    military less reliant on Reserve mobilization places less of a
    requirement on the executive branch to seek congressional approval when
    deploying the United States Military. Could you elaborate on how you
    envision the end state of the military after restructuring the Active
    and Reserve Forces?
        Secretary Rumsfeld. Use of RCs is an integral part of the
    Department's total force policy in support of our Nation's challenges
    and interests, and will continue to be so as we meet the emerging
    challenges of the 21st century and the myriad of requirements
    associated with the global war on terrorism. Our focus is to have a
    force with the right amount of capabilities in the right place, able to
    use them at the right time. Access to the RC without reliance on
    mobilization, especially in the early phases of rapid response
    operations, is both prudent and necessary. In the end, our goal is to
    rebalance the RC to ensure reasonable and sustainable mobilization
    rates.

        53. Senator Dole. Secretary Rumsfeld, more specifically, will the
    transformed military still depend on mobilizing the Reserve Forces to
    execute significant military operations?
        Secretary Rumsfeld. The transformed military will still depend on
    mobilizing the Reserve Forces to execute significant military
    operations. The forces that will be most readily available in the early
    stages of a rapid response operation will be those in the AC. At the
    same time, unique capabilities resident within the RC can still be used
    through enhanced volunteerism without the need for early mobilization.
    The Reserves remain a critical part of our total force, and as such
    will always be essential to major combat operations.

        54. Senator Dole. Secretary Rumsfeld, partial mobilization, by law,
    authorizes the mobilization of Ready Reserve members, without their
    consent, for a period not to exceed 24 consecutive months. Yet a policy
    has been instituted within the Department that requires our Ready
    Reserve Forces, who have been previously mobilized (but still have not
    met the 24 month cap), to sign statements declaring that they volunteer
    to be mobilized for a second tour. In most cases, if the service member
    refuses to volunteer for a second tour, they will not be mobilized with
    the rest of their unit. In one specific case in my State, service
    members were reluctant to volunteer, not for lack of motivation or an
    unwillingness to deploy, but because they feared long-term
    consequences, both financially and socially. Service members are
    concerned that by volunteering (via a signed document retrievable
    through the Freedom of Information Act (FOIA)) for active duty they may
    give up protections afforded them under the Servicemembers Civil Relief
    Act. They fear employers will be less likely to hold their jobs because
    their return to active duty was voluntary. Additionally, some service
    members fear societal repercussions; their spouse, for example, may not
    share the service member's enthusiasm as they consider another year
    apart. In this situation the service members fear that a signed
    volunteer form, if made public, may come back to haunt them. Thus, the
    requirement for a signed volunteer statement has the unintended
    consequence of forcing mobilized units to find individual replacements
    for soldiers electing not to volunteer. I fear this policy may also
    contribute to more force turbulence in the long run.
        Can you explain why a policy has been instituted that seems
    contrary to the edicts of an executive order directing the partial
    mobilization of the Ready Reserve? Why does the Department feel this
    documentation is necessary?
        Secretary Rumsfeld. There is no Department-wide policy to that
    effect. The Department's policy is to encourage and maximize the use of
    volunteers to reduce the need for involuntary mobilizations.
    Volunteerism is a cornerstone of the current mobilization, and it has
    served the Nation well.
        It is important to note that whether service is voluntary or
    involuntary, the service member enjoys and retains the same rights,
    benefits, and protections under both the service members Civil Relief
    Act and the Uniformed Services Employment and Reemployment Rights Act.
        However, to best employ its total force, the Department of Army
    established a set of guidelines or priorities regarding how they select
    units and individuals for deployment, both active duty and Reserve
    component members. These involve readiness, time at home station, and
    length and number of times mobilized. One of these guidelines with
    respect to Guard and Reserve units and individuals is that they will
    only be mobilized for a second time as a last resort. However, if there
    are soldiers who wish to volunteer for a second mobilization, the Army
    has informally asked them to acknowledge that they are volunteering for
    a second mobilization to insure the guidelines are being followed.
        Though the intent of this practice is valid, it may, as you pointed
    out, be counterproductive. Accordingly, I have initiated a Department-
    wide review of individual call up documentation to ensure that
    volunteerism is not hampered, that unintended consequences are not
    generated, and that we properly account for our service members.

        55. Senator Dole. Secretary Rumsfeld, on a related issue, please
    provide me the actual numbers of Guard and Reserve members who have
    been mobilized since 1991, the number mobilized more than once, more
    than twice, and the number mobilized more than three times. Of those
    mobilized multiple times, how many signed volunteer statements?
        Secretary Rumsfeld. The best available data reflects the number of
    Reserve component (RC) members mobilized (fiscal year 1991 (1 October
    1990)--first quarter fiscal year 2004 (31 December 2003)):
        Total Mobilized from fiscal year 1991 (1 October 1990) first
    quarter fiscal year 2004 (31 December 2003): 575,057 (Desert Shield/
    Desert Storm; Haiti; Bosnia; SouthWest Asia; Kosovo, Noble Eagle/
    Enduring Freedom/lraqi Freedom)
        Mobilized once (for one contingency only): 517,942
        Total mobilized two times: 53,060
          (Mobilized two times--for current contingency only): (15,982)
          (Mobilized two times--for two contingencies only): (37,078)
        Mobilized three times (for three contingencies only): 3,520
        Mobilized more than three times (for more than three
    contingencies): 535
        Data includes all members who served in the Reserve components over
    this time period, including those who are no longer in the force.
        The total number of individuals who have served in the Selected
    Reserve during this time period is about 2,549,855.
        Most of the members mobilized were Selected Reserve members.
        About 45,000 of those mobilized were Individual Ready Reserve
    members.
        Some of the Army RC members mobilized did volunteer for
    mobilization under involuntary orders. Army information reveals that
    the policy of having volunteers sign forms, indicating that they are
    true volunteers, began in late 2003.
        From January 1, 2004 through March 31, 2004, 1,883 Army RC members
    signed such forms. This is 6.9 percent of the total Army RC members
    mobilized (27,428) in the first quarter of 2004.
        It is important to note that a member's military obligation to
    serve in the Ready Reserve as part of the All-Volunteer Force is with
    the understanding that the member is liable for active duty in times of
    war or national emergency. Therefore, if these members did not
    volunteer for duty, others, or possibly even these members themselves,
    would have been called-up.
                                     ______

                   Questions Submitted by Senator Carl Levin
                                  iraq and wmd
        56. Senator Levin. Secretary Rumsfeld, on September 26, 2002, you
    stated ``We know they have weapons of mass destruction. We know they
    have active programs. There isn't any debate about it.'' On January 7,
    2003, you said: ``There is no doubt in my mind but that they currently
    have chemical and biological weapon.'' What was the basis for your
    statements that you knew that Iraq possessed WMD, and that there
    ``isn't any debate about it''?
        Secretary Rumsfeld. [Deleted.]

        57. Senator Levin. Secretary Rumsfeld, on March 11, 2003, you said
    that Saddam Hussein ``claims to have no chemical or biological weapons,
    yet we know he continues to hide biological and chemical weapons,
    moving them to different locations as often as every 12 to 24 hours,
    and placing them in residential neighborhoods.'' What was the basis for
    your statement that you knew that Iraq continued to hide biological and
    chemical weapons and move them every 12 to 24 hours?
        Secretary Rumsfeld. [Deleted.]

                         intelligence/al qaeda and iraq
        58. Senator Levin. Secretary Rumsfeld, in the summer of 2002, the
    staff of the Under Secretary of Defense for Policy, Doug Feith,
    presented a briefing to you on analysis of the intelligence concerning
    the links between Iraq and al Qaeda. That same briefing was later
    provided, reportedly at your suggestion, to the DCI, then to
    Intelligence Community staff, then to the National Security Council
    (NSC), and then to the Office of the Vice President. What was the
    purpose of this intelligence analysis product that was prepared outside
    of the Intelligence Community?
        Secretary Rumsfeld. There is no ``intelligence analysis product
    that was prepared outside the intelligence community'' as you state. A
    briefing was prepared, as you note, to point out information obtained
    from a CIA report published during the Clinton administration. The
    information in this CIA product led to information contained in several
    other CIA publications, and this data was immediately brought to the
    attention of the DIA, the Joint Staff J-2, and the Defense Intelligence
    Officer (DIO) for the Middle East in April 2002--the Intelligence
    Community, in other words. This information was subsequently briefed,
    as you noted, to the DCI, to Intelligence Community staff, and to the
    NSC--hardly the hallmark of preparing an intelligence product ``outside
    the Intelligence Community.''
        The purpose of the briefing was to help to clarify the various
    kinds of support and relationships that existed between terrorist
    groups and various state sponsors based on existing intelligence.

                                postwar planning
        59. Senator Levin. Secretary Rumsfeld, in the current edition of
    the Atlantic Monthly magazine, James Fallows has an article describing
    problems with the postwar planning effort for Iraq. One of his
    recurring points is that the Defense Department, specifically your
    office, told military personnel they could not participate in the
    various planning studies and exercises that were being conducted by the
    CIA, the State Department, the Army War College, and the U.S. Agency
    for International Development (USAID). Did you or your office ever tell
    any military personnel not to participate in any such planning effort
    and, if so, why?
        Secretary Rumsfeld. Mr. Fallows' article says Pentagon personnel
    ``were forbidden by OSD to attend'' numerous interagency meetings,
    including a January 2003 National Intelligence Council exercise. This
    is not the case. As just one example, Dr. Joseph J. Collins, Deputy
    Assistant Secretary of Defense for Special Operations and Low-Intensity
    Conflict, certainly an important part of OSD, participated not only in
    this particular National Intelligence Council meeting, but from early
    fall of 2002 and through March 2003, also participated in countless
    interagency meetings and conferences, working hand in glove with our
    colleagues at the Department of State, USAID, the CIA, and the NSC,
    acting as the Pentagon's ``point man'' for postwar planning.

        60. Senator Levin. Secretary Rumsfeld, according to James Fallows'
    article in this month's Atlantic Monthly, you called retired General
    Jay Garner and told him to fire Tom Warrick, the head of the State
    Department's ``Future of Iraq'' study team, from General Garner's
    reconstruction planning staff. According to Fallows, your direction to
    fire Warrick came from higher authority, believed to be Vice President
    Cheney. Did you tell General Garner to fire Tom Warrick, and did Vice
    President Cheney have any involvement in this issue?
        Secretary Rumsfeld. This is not true. I did not direct Jay Garner
    on matters related to junior staff. As I did not call him, questions
    regarding the Vice President's ``direction'' in this matter are moot.

        61. Senator Levin. Secretary Rumsfeld, why did the administration
    not want Tom Warrick to serve on General Garner's staff, especially
    given that General Garner reportedly indicated that Tom Warrick was a
    highly valued member of his team?
        Secretary Rumsfeld. State Department officials, including Mr.
    Warrick, participated in daily interagency planning meetings on post-
    Saddam Iraq from their beginning in the summer of 2002. When it came
    time to staff the Office of Reconstruction and Humanitarian Assistance
    (January 2003), State Department experts were a significant percentage
    of the interagency team assigned.

                          iraq and biological weapons
        62. Senator Levin. Secretary Rumsfeld, on September 19, 2002, you
    told this committee of the ``need to focus on the immediate threat from
    biological weapons. . . . Iraq has these weapons. They are much simpler
    to deliver than nuclear weapons and even more readily transferred to
    terrorist networks who could allow Iraq to deliver them without Iraq's
    fingerprints on the attack.''
        Dr. David Kay testified last Wednesday that the ISG had found no
    evidence that Iraq had any stockpiles of biological weapons before the
    war. What was the basis for your comment that Iraq's biological weapons
    posed an ``immediate threat''?
        Secretary Rumsfeld. The last NIE of the previous administration had
    this to say in December 2000:
        [Deleted.]
        In October 2002, the CIA stated that, ``there are compelling
    reasons to be concerned about BW activity at other sites and in mobile
    production units and laboratories. Baghdad has pursued a mobile BW
    research and production capability to better conceal its program.''
    (Emphasis in original: (U) CIA, ``Iraq's Weapons of Mass Destruction
    Programs,'' p. 17.)
        The basis for my comment, then, was (a) intelligence from the
    experts at the UN, operating in Iraq from 1991 through 1998; (b)
    contemporary intelligence from the CIA; and (c) the intelligence
    presented during the previous administration.

        63. Senator Levin. Secretary Rumsfeld, on September 19, 2002, in
    testimony to this committee about Saddam Hussein's WMD programs, you
    said ``Many of his WMD capabilities are mobile and can be hidden to
    evade inspectors.''
        The administration has said that the two trailers found in Iraq
    were intended to produce biological warfare (BW) agents. Last week Dr.
    Kay told this committee ``I think the consensus opinion is that when
    you look at those two trailers . . . their actual intended use was not
    for the production of biological weapons.''
        Were you referring to mobile biological trailers in your testimony?
    If so, what is your current view on whether those trailers were
    intended to produce biological agents? If not, what were you referring
    to?
        Secretary Rumsfeld. The consensus opinion of the entire
    Intelligence Community in October 2002, was that there were compelling
    reasons to be concerned about BW activity in mobile production units
    and laboratories. ``Iraq has now established large-scale, redundant,
    and concealed BW agent production capabilities based on mobile BW
    facilities.'' (U) CIA, ``Iraq's Weapons of Mass Destruction Programs,''
    p. 17.

        64. Senator Levin. General Pace, in the current edition of the
    Atlantic Monthly magazine, James Fallows wrote a long article about the
    problems with the planning for the postwar situation in Iraq. He
    described numerous studies and planning efforts conducted outside of
    the Defense Department and military, including by the CIA, USAID, State
    Department, Army War College, and others. His article says that the
    military and the Defense Department ignored these studies. Is that
    true? If so, why were they ignored?
        General Pace. DOD Deputy Assistant Secretary of Defense (DASD)
    Joseph J. Collins has already formally provided a rebuttal to that
    article. The rebuttal was printed in the April 2004 issue of the
    Atlantic (copy included). I concur with DASD Collins' assessment, that
    Mr. Fallows' article overemphasized bureaucratic conflict in the
    executive branch and distorted the nature of the contingency planning.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        All components of the executive branch involved in national
    security, Defense, State (to include USAID), the CIA, and the NSC, were
    involved in the contingency planning for postwar Iraq. The fact that
    different agencies did not completely agree during the planning process
    is well-known and requires no further explanation, but when the time
    came for national-level decisions in an NSC meeting, all points of view
    were vetted and resolved.
        Planning by interagency representatives occurred for OIF and its
    possible contingencies every single day. The level of coordination for
    the planning for Iraq was unprecedented. Our planners did not work in a
    vacuum; they participated in the ``Future of Iraq'' project; they went
    to the war colleges for seminars, and they interacted through the
    policy and academic communities at periodic events.
        Planners do not have a perfect crystal ball. Some of our
    assumptions were correct; some were incorrect. Regardless, we have
    adjusted for current circumstances, modified our path where required,
    and continued to move forward. Not surprisingly, there are disputes. In
    our open system of government, combined with a free media, these
    disputes sometimes play themselves out in our newspapers and magazines
    and television. But that does not mean we are blind about the realities
    of the situation in Iraq or lacking in energy and thought about
    crafting a way forward.
        The positive results are often overlooked. One of the most heinous
    dictators of the 20th century is permanently vanquished, and over 25
    million people liberated from his tyrannical regime of oppression and
    death. Over 80 percent of Saddam's senior leadership have been killed
    or captured, while rebuilding in Iraq proceeds at a pace unknown in
    other examples of postwar contingencies. Furthermore, Iraq was
    liberated while protecting most of its infrastructure and natural
    resources, providing key enablers to allow Iraq to rapidly return to
    the world's family of peaceful nations, and soon the family of
    democratic nations as well. The Iraqi Governing Council signed into
    being Iraq's first ever--in a society many millenniums old--interim
    constitution establishing the elements of a democratic government with
    guarantees of basic human rights--another first for the Middle East.
    This would never have happened under Saddam or his sons.

                                missile defense
        65. Senator Levin. Secretary Rumsfeld, the Department has announced
    plans to ``field'' a national missile defense in September, despite the
    fact that the system has not yet been operationally tested. Your budget
    request also asks for hundreds of millions of dollars to continue
    production of missiles for this system, which have yet to be
    realistically tested.
        DOD officials testified last year that the Department had no intent
    to waive operational testing for missile defense. For example, then-
    Under Secretary of Defense for Acquisition Pete Aldridge testified
    that: ``the reason we have the [national missile defense] test bed. . .
    is to enable operational testing.'' However, in a recent article the
    Pentagon's chief tester, Tom Christie, said: ``I don't know when we're
    going to run operational tests, to be brutally frank. That's off in the
    future.''
        When do you plan to have the Pentagon's chief tester conduct formal
    operational testing for the National missile defense system, in
    accordance with the law, so that we will all know whether the system
    will actually work against a real threat?
        Secretary Rumsfeld. At Initial Defensive Operations (IDO) the BMDS
    will provide a modest operational capability to defend the Nation
    against a limited ballistic missile attack. The test bed will enable
    testing to improve system maturity and, through the next year,
    incorporation of operational testing objectives for developmental
    testing. These tests will incorporate increasing levels of operational
    realism using alert-configured hardware and software, operational
    tactics, techniques and procedures, threat-representative targets, and
    trained warfighters. They will facilitate assessment by the tri-Service
    Operational Test Agency team in support of the DOT&E's annual reporting
    requirements. Title 10 operational testing of the integrated system
    will be planned and executed as appropriate.

        66. Senator Levin. General Pace, General Myers' written testimony
    says that we will achieve ``full operational capability'' for missile
    defense this year. According to Defense Department documents, full
    operational capability means, ``the full attainment of the capability
    to employ effectively a weapon, item of equipment, or system.''
        Yet, according to a report recently sent to Congress by the
    Pentagon's chief tester, the national missile defense the Department
    intends to deploy in September of this year has not yet had end-to-end
    operational testing. This report also says that ``at this point in
    time, it is not clear what mission capability will be demonstrated
    prior to [deployment].'' Furthermore, Secretary Rumsfeld has said that
    the missile defense to be deployed this year will only be
    ``rudimentary,'' and that any ``capability'' will be with a small
    ``c.''
        How can you assert that missile defense will be ``fully
    operational'', when the Pentagon's chief tester says we have no idea
    how well the system will work, because we haven't realistically tested
    it yet?
        General Pace. The missile defense capability to be delivered this
    year is an initial capability intended to provide a rudimentary means
    to defend against a limited, long-range ballistic missile attack
    against the United States. The chairman and I are confident that we are
    on track to field and operate this capability.
        Admiral Ellis at U.S. Strategic Command (USSTRATCOM) is conducting
    a Military Utility Assessment (MUA) providing the COCOMs assessment of
    the missile defense operational capabilities and limitations. His
    initial increment of the assessment is based on data available in the
    September-December 2003 timeframe. The additional test events,
    exercises, and war games to be executed in 2004 will allow for a more
    in-depth assessment, and confidence in the assessed capabilities will
    grow as more system performance data is collected.
        The MUA and the assessment by the DOT&E are closely related. They
    share a common database of observations derived from testing and
    simulation at the system, element, component and subcomponent level.
    The warfighter and Operational Test Agencies are working
    collaboratively to develop test objectives, quantify system
    performance, and assess mission execution.
        Unlike a traditional operational test and evaluation, the MUA is
    not assessing performance against a fixed performance level; instead it
    is determining the extent to which a developmental system contributes
    to mission accomplishment. The missile defense system to be fielded
    this year will make us safer than we are now and serve as the
    foundation for increasingly effective capabilities in the future.

                                  jsf program
        67. Senator Levin. Secretary Rumsfeld, the DOD press release on the
    budget states that the development cost for the JSF program has
    increased more than $7 billion from $33.0 billion to $40.5 billion in
    the last year, and that ``schedule delays on this very complex aircraft
    are prudent and necessary.'' Is this 22 percent cost growth in the JSF
    program a reflection of unrealistic cost estimates or poor program
    management?
        Secretary Rumsfeld. The Acting USD(AT&L) directed a restructuring
    of the program to improve the performance of the aircraft through
    additional design work. The focus is on reducing the weight of each
    variant, since weight control is always a challenge for aircraft, and
    is particularly critical for the short-takeoff-and-vertical-landing
    (STOVL) variant. This additional work and schedule extension contribute
    to the increased cost of the System Development and Demonstration (SDD)
    phase of the JSF program. Developing three JSF variants for the
    Services is an aggressive undertaking. I view these budget changes as
    cost and schedule realism, inherent in a program unmatched in scope,
    complexity, and importance, rather than as the product of unrealistic
    estimates or poor management.
        We are replanning JSF SDD to make sure that we succeed.
    Specifically, our SDD plan recognizes that: (1) STOVL performance is
    absolutely vital; (2) we must focus on STOVL performance upfront to
    ensure the viability of that variant for our warfighters; (3) we must
    aggressively pursue trade studies to improve performance by reducing
    weight; (4) we must aggressively pursue propulsion enhancements to
    improve performance; and (5) fiscal year 2007 is the right time to
    begin low-rate initial production. We also are reviewing the program,
    with the assistance of an independent team, to establish that we are
    doing all we can to succeed.
        I want to point out that the development of propulsion, subsystems,
    avionics, and autonomic logistics has gone well. The extensions in the
    schedule and increases in cost will allow us to improve the design of
    the airframe, but do not reflect difficulties in all aspects of
    development.

        68. Senator Levin. Secretary Rumsfeld, in your view, is a 1-year,
    22 percent cost growth in a major program like this acceptable?
        Secretary Rumsfeld. Cost growth in any program is a reason for
    concern and should be examined to identify its causes. The 22-percent
    cost increase spans fiscal year 2005 through fiscal year 2013. In the
    President's budget for 2005, the Department extended the design phase
    and reprogrammed procurement funds to account for the additional work.
    The increase in cost also reflects the development of anti-tamper
    capability, technical risks, and adjustments to the cost estimate to
    reflect those risks with a greater degree of confidence. The increase
    in cost, over the full course of development, is reasonable for a
    program of this magnitude and complexity.

                                nonproliferation
        69. Senator Levin. Secretary Rumsfeld, the President's budget
    request would reduce funding for the Nunn-Lugar Cooperative Threat
    Reduction (CTR) program by $40 million--from $449 million to $409
    million. At a time when we are all deeply concerned about the danger
    that WMD--and especially nuclear weapons--could end up in the wrong
    hands, why would we want to cut back on the one program that has proven
    most successful in preventing the proliferation of such weapons?
        Secretary Rumsfeld. The decrease you are questioning is largely due
    to the Chemical Weapons Destruction Facility having completed the
    capital-intense phase of construction. The question implies that the
    annual budget request is the single measure of progress and the single
    indicator of commitment. It is an important metric. But there are three
    others: actual threat reduction, value for US investments, and
    increasing recipients' stake in the success of specific projects.
    Measured against the aggregate of all four metrics, the CTR program
    continues to be a vital component of the U.S. Government's national
    security strategy. The President and his administration remain firmly
    committed to his 2002 pledge of $10 billion over 10 years for
    nonproliferation and threat reduction programs in the former Soviet
    Union, including--but not limited to--CTR. Yearly programmatic
    requirements mean that some annual requests, as for fiscal year 2005,
    will slightly below the $1 billion average; others will be slightly
    above.
        It is important to acknowledge that, of the 62 CTR program areas
    Congress has funded since the program's inception, 51 of those areas
    are now complete. This reflects the large amount of former Soviet
    nuclear weapons inventory and infrastructure that CTR has helped
    eliminate or secure. Many of CTR's original array of projects is
    reaching completion. These include projects that were capital-intense
    in their early construction phases. CTR's fiscal year 2005 program plan
    includes only two ``infrastructure-heavy'' projects: the Shchuch'ye
    chemical weapons destruction project already under way, and
    infrastructure supporting Nuclear Weapons Site Security enhancement
    projects. Newer areas of CTR focus--Biological Weapons Proliferation
    Prevention and Weapons of Mass Destruction-Proliferation Prevention
    Initiative--do not require capital-intense construction projects to
    achieve their threat reduction goals.

                         development of nuclear weapons
        70. Senator Levin. Secretary Rumsfeld, the President's budget
    request would increase the funding for new or modified nuclear weapons
    and include funds intended to cut in half the time needed to resume
    nuclear weapons testing. What is the military requirement for new
    nuclear weapons?
        Secretary Rumsfeld. Military requirements stem from a lack of
    capability to perform a mission. If existing nuclear weapons cannot
    perform a mission or meet only a portion of our deterrence objectives,
    we are obligated to pursue ways to correct these deficiencies in order
    to maintain the U.S. deterrent. Our current situation is that our
    forces are equipped with nuclear systems whose average age is 20 years
    and that were designed for a Cold War deterrence posture. We have
    requested a few programs to examine the potential to adapt existing
    weapons to give them improved capabilities. We also need to explore new
    technologies and processes that will keep our scientists and engineers
    at the forefront of nuclear weapon science.
        The main thrust of test readiness is aimed at reducing the amount
    of time we required in order to address a potentially serious problem
    in the stockpile using an underground nuclear test. We believe that 36
    months is too long; the U.S. needs a more responsive test readiness
    posture, which is reflected in the President's fiscal year 2005
    request.

        71. Senator Levin. Secretary Rumsfeld, what are the target types
    for these new nuclear weapons?
        Secretary Rumsfeld. First, there are no current programs to produce
    any new nuclear weapons. We made that point clear in the Nuclear
    Posture Review, which was submitted to Congress in December 2001.
    However, the Nuclear Posture Review did identify limitations in
    capabilities of the existing nuclear arsenal. We are examining both
    nuclear and non-nuclear options that could correct the existing
    limitations. For example, hard and deeply-buried targets, which are
    often associated with adversary weapons of mass destruction facilities,
    are one area where it would be very useful to improve our current
    capabilities. We are studying an option to repackage an existing weapon
    to do so.

        72. Senator Levin. Secretary Rumsfeld, are these new nuclear
    weapons intended to be used in a preemptive fashion?
        Secretary Rumsfeld. The United States is not developing any new
    nuclear weapons for any purpose. The President of the United States is
    the sole authority for employing nuclear weapons to protect U.S.
    territory, troops, allies, or friends against aggression. Today, the
    United States and our friends and allies are threatened by rogue states
    that possess weapons of mass destruction. As a matter of policy, no
    President forecloses options that can be used to deter and defeat
    aggression. It is my job to ensure the President has the flexibility
    and the options to address the variety of risks that our Nation may
    face today and in the foreseeable future.

        73. Senator Levin. Secretary Rumsfeld, will we have to resume
    nuclear weapons testing to support new and modified nuclear weapons?
        Secretary Rumsfeld. The administration is currently observing as
    matter of policy a test moratorium, although we continue to oppose
    ratification of the Comprehensive Test Ban Treaty (CTBT). Annually, the
    Secretary of Energy and I review an assessment of the safety and
    reliability of the stockpile. At this time, the Secretary of Energy and
    I have not recommended that the U.S. resume nuclear testing to resolve
    technical issues affecting the safety and reliability of the nuclear
    stockpile.

                          detainees at guantanamo bay
        74. Senator Levin. Secretary Rumsfeld, the President has determined
    that six detainees being held in Guantanamo are eligible to be tried by
    military commissions, though the actual decision whether to charge
    someone will be made by the Appointing Authority, Major General John D.
    Altenburg, Jr. My understanding is that no date has been set yet to
    start commission proceedings. In the meantime, five detainees have been
    assigned defense counsel, and these military attorneys have filed a
    friend-of-the-court brief to the U.S. Supreme Court. They argue that
    prisoners convicted by military commissions should have the right to
    appeal to civilian courts. This is an issue that I raised when we held
    a hearing in December 2001 on military commissions. In addition, my
    staff has been told that even if a detainee is tried and acquitted of
    all charges, the DOD may continue to detain that individual
    indefinitely. When will you begin military commission proceedings, and
    how long do you expect it to take for the government to either release
    or charge and try all 650 or so detainees?
        Secretary Rumsfeld. In February, Guantanamo detainees Ali Hamza
    Ahmed Sulayman al Bahlul of Yemen and Ibrahim Ahmed Mahmoud al Qosi of
    Sudan were charged with conspiracy to commit war crimes. Prior to being
    charged, these detainees were assigned military defense counsel. Their
    trial dates and commission panel members will be selected at a later
    time. In addition to the assignment of counsel to and the charging of
    al Bahlul and al Qosi, military defense counsel have been assigned to
    Salim Ahmed Hamdan of Yemen and David Hicks of Australia.
        As you point out, military defense counsel have filed a friend-of-
    the-court brief to the U.S. Supreme Court. I have no doubt that
    military defense counsel will mount a vigorous defense for any
    individual they are assigned to represent and that the efforts of the
    prosecution will be no less vigorous. Those involved in the military
    commission proceedings must take the time to do things properly so that
    every accused receives a full and fair trial. It would be inappropriate
    and impossible for me to predict a date certain for a conclusion to all
    of the cases in which charges will be brought.
        Moreover, it is important to bear in mind that the war with al
    Qaeda is real and ongoing. Since the massive attacks of September 11,
    al Qaeda has continued to launch attacks as well as to attempt attacks.
    In December 2001, Richard Reid, who has been linked to al Qaeda
    attempted to bomb a transatlantic commercial flight. In April 2002, al
    Qaeda firebombed a synagogue in Djera, Tunisia. Last spring, al Qaeda
    suicide bombers attacked three residential compounds for foreign
    workers in Riyadh, Saudi Arabia, killing 34 people including 10 U.S.
    citizens. In August 2003, Jemaah Islamiyah, an al Qaeda affiliated
    group, set off a car bomb outside the J.W. Marriott Hotel in Jakarta,
    Indonesia, killing 12 and wounding 150. This past fall, the Taliban
    stepped up its insurgency in Afghanistan. U.S. troops and coalition
    forces remain on the ground in Afghanistan. Between August 2003 and
    January 2004, 11 U.S. soldiers have been killed in Afghanistan. Just
    recently, several Army Rangers were killed in an ambush in Afghanistan.
    It is clear that the war is far from over.
        Those detained at Guantanamo have been captured in a real war. They
    include not only rank and file soldiers who took up arms against the
    coalition in Afghanistan but also senior al Qaeda and Taliban
    operatives, some who have been linked to potential attacks against the
    United States, and others who continue to express their commitment to
    kill Americans if released.
        We detain them to prevent them from returning to the conflict--to
    prevent them from hijacking a plane and using it as a weapon of mass
    destruction, returning to the battlefields of Afghanistan, or rejoining
    the armed conflict against the United States elsewhere. We detain these
    individuals for the security of our citizens and our soldiers. When we
    believe that these individuals can be either transferred to the control
    of another government or released without impairing the security of our
    service men and women as well as our citizens we have done so. To date,
    146 detainees have been released or transferred from Guantanamo. We
    have done so despite the fact that the law of war does not require it.
    Moreover, we have done so through a multi-layered and interagency
    process that likewise is not required by the law of war.
        We are not limited to either charging or releasing these detainees.
    The law of war does not require the release of enemy combatants prior
    to the cessation of hostilities. It does not require it because to do
    so would be to undermine the very purpose of the law of war itself:
    minimizing the loss of life and damage inflicted by war. Releasing
    individuals who would return to the fight could only serve to inflict
    more damage on U.S. citizens and their sons and daughters who bravely
    serve this country. This reasoning would also lead to the unacceptable
    conclusion that the only means to remove the enemy from the battlefield
    is to kill him. Nor does the law of war require that we charge the
    detainees held at Guantanamo. Enemy combatants are held at Guantanamo
    not as punishment but to prevent them from continuing the fight.
        During the course of any war, the end of the war remains uncertain.
    It could have very easily been said during the middle of World War II
    or Vietnam that prisoners of war captured during those wars were going
    to be held indefinitely. No one could predict with certainty the end to
    either of those conflicts. Nor can we predict today with certainty the
    conclusion of al Qaeda's war against the United States.
        In a very real sense, the release of detainees not suspected of
    violations of the law of war lies in the hands of al Qaeda and its
    affiliates and supporters. Only al Qaeda and its affiliates and
    supporters can stop waging war against the United States. Until they
    stop, we will not rest and we will not increase their strength by
    permitting their fighters to return to the battlefield anywhere in the
    world. This war will not last forever. It is a war that I am confident
    we will win.

                       north korea's nuclear capabilities
        75. Senator Levin. Secretary Rumsfeld, North Korea has taken some
    alarming actions and made some alarming announcements over the last 2
    years. Last October, Pyongyang declared that they had reprocessed all
    8,000 plutonium fuel rods that had been canned and frozen for 7 years
    under the Agreed Framework--from 1994 to 2003. This came after North
    Korea had expelled the International Atomic Energy Agency (IAEA)
    inspectors, withdrawn from the Non-Proliferation Treaty (NPT), and
    stated that it had restarted its five-megawatt nuclear reactor.
    According to a new report, North Korea may already have as many as
    seven nuclear weapons. How solid is our intelligence regarding North
    Korea's nuclear capabilities and intentions, and specifically regarding
    the reprocessing of the spent plutonium?
        Secretary Rumsfeld. As you are aware, North Korea presents an
    extremely difficult intelligence target. Its extreme isolation and
    Stalinist society present daunting obstacles to fully understanding and
    ascertaining events within its borders. Nevertheless, we have
    concluded, as have North Korea's neighbors (China, Japan, South Korea
    and Russia), that North Korea does have an ongoing and active nuclear
    weapons program. We have all come to this conclusion independently, and
    are actively engaged in the Six Party Talks with North Korea aimed at
    ending this program and its threat to regional peace and stability.
        As reported in the press, a recent, non-official U.S. delegation to
    North Korea, containing former nuclear weapons experts, was allowed to
    tour North Korea's primary nuclear facility at Yongbyon. They were
    shown an empty area where the 8,000 spent fuel rods containing
    plutonium had been stored and material they adjudged to be reprocessed
    plutonium from this fuel. It is possible that North Korea has
    fabricated several nuclear weapons from this plutonium, but we cannot
    confirm this.
        Dr. David Kay states unequivocally in his ``Interim Progress Report
    on the activities of the Iraq Survey Group (ISG)'' that there were
    prohibited weapons programs in Iraq and that Saddam was in violation of
    the U.N. Security Council resolutions regarding weapons of mass
    destruction. In addition, by expelling UNSCOM he clearly showed his
    contempt for the U.N. and international norms. It is also a fact that
    Saddam's regime sheltered and met with terrorists over the course of
    the 1990s and into the new century.
        As the President has said, he ``will not wait on events while
    dangers gather.'' The Saddam regime was dangerous, in clear violation
    of U.N. Security Council Resolutions regarding WMD, and was a state
    sponsor of terrorism. In light of these facts, there does not seem to
    be a need to reexamine the decisions that led to the liberation of the
    people of Iraq.

        76. Senator Levin. Secretary Rumsfeld, how willing is the rest of
    the world likely to rely upon this intelligence, in light of concerns
    that have been raised about the intelligence that we relied upon in
    Iraq?
        Secretary Rumsfeld. China, Japan, South Korea, and Russia, have all
    independently concluded that North Korea has an ongoing and active
    nuclear weapons program. In light of the number of disparate
    intelligence agencies that have all independently come to this
    conclusion, including three of the most powerful countries on Earth--
    Russian, China, and Japan--I think it very likely the rest of the world
    will consider this intelligence to be reliable.

                              preemption doctrine
        77. Senator Levin. Secretary Rumsfeld, press reports have quoted
    David Kay as saying ``If you cannot rely on good, accurate intelligence
    that is credible to the American people and others abroad, you
    certainly can't have a policy of preemption.'' In light of the
    intelligence failures which clearly undercut the prime rationale for
    the war in Iraq, do you continue to espouse a doctrine of preemption
    for the future?
        Secretary Rumsfeld. America's future depends on our willingness to
    lead in the world. One of the important lessons from September 11 is
    that we must take threats seriously before they fully materialize. The
    United States has long maintained the option of preemptive actions to
    counter a sufficient threat to our national security. The greater the
    threat, the greater is the risk of inaction--and the more compelling
    the case for taking anticipatory action to defend ourselves, even if
    uncertainty remains as to the time and place of the enemy's attack. To
    forestall or prevent such hostile acts by our adversaries, the United
    States will, if necessary, act preemptively.
                                     ______

                Questions Submitted by Senator Edward M. Kennedy
                            office of special plans
        78. Senator Kennedy. Secretary Rumsfeld, it has been suggested that
    the Pentagon established the Office of Special Plans (OSP) to sift for
    yourself the information on Iraq. Many believe that by establishing OSP
    you were signaling your lack of confidence in the Intelligence
    Community and its assessment of the threat posed by Iraq. What was your
    goal in establishing OSP? Was it to develop intelligence to contradict
    that produced by the CIA, as some have suggested?
        Secretary Rumsfeld. The Directorate of Special Plans (often
    referred to as the OSP) was an expansion of that part of the Bureau of
    Near East and South Asian Affairs (NESA) that dealt with Iraq and Iran.
    It was renamed ``Special Plans'' because we did not want to undercut
    the President's diplomatic efforts in the United Nations and elsewhere
    with respect to Iraq by attracting attention to the fact that the part
    of NESA that dealt with Iraq was being expanded.
        This directorate was an expansion of the Northern Gulf Directorate
    within NESA in September 2002. It was established due to the increased
    workload related to the war on terrorism and to what was then a
    possible Iraq contingency. It was a policy planning group and was a
    consumer, rather than a producer, of intelligence. It helped develop
    policy with respect to subjects such as deployment planning, coalition
    building, media in a putative postwar Iraq, potential war crimes
    investigations, possible oil issues in a postwar Iraq, and
    implementation of the 1998 Iraq Liberation Act (Public Law 105-338,
    passed unanimously by the Senate).

        79. Senator Kennedy. Secretary Rumsfeld, did it, indeed, reflect a
    lack of confidence in the analysis you were receiving from the
    Intelligence Community? If so, what was your principal complaint with
    the community's analysis?
        Secretary Rumsfeld. As stated earlier, the organization that was
    then known as the Directorate of Special Plans (often referred to as
    the OSP) did not provide ``competitive analysis'' of intelligence.

        80. Senator Kennedy. Secretary Rumsfeld, did OSP ever go beyond
    analysis and collect any intelligence of its own, at any time?
        Secretary Rumsfeld. No. It was a policy planning group and was a
    consumer, rather than a producer, of intelligence.

        81. Senator Kennedy. Secretary Rumsfeld, did OSP ever task the
    Iraqi National Congress (INC) to collect intelligence? If so, how were
    tasking priorities established?
        Secretary Rumsfeld. No.

        82. Senator Kennedy. Secretary Rumsfeld, what was your assessment
    of the intelligence the INC collected?
        Secretary Rumsfeld. Any assessment of the intelligence the INC
    collected was provided to me by the professionals of the Intelligence
    Community, having been processed in accordance with long-established
    vetting procedures used throughout the Intelligence Community.

        83. Senator Kennedy. Secretary Rumsfeld, was this intelligence
    subsequently vetted for accuracy?
        Secretary Rumsfeld. The professionals of the DIA treated the data
    obtained in exactly the same way it treated any other intelligence
    source information, processing it in accordance with long-established
    vetting procedures used throughout the Intelligence Community.

        84. Senator Kennedy. Secretary Rumsfeld, how accurate was it
    determined to be at the time? How accurate is it now determined to be?
        Secretary Rumsfeld. The professionals of the DIA treated the data
    obtained in exactly the same way it treated any other intelligence
    source information, processing it in accordance with long-established
    vetting procedures used throughout the Intelligence Community.
        There are many examples of excellent information provided by the
    INC Information Collection Program. Here are a few categories:
        [Deleted.]

        85. Senator Kennedy. Secretary Rumsfeld, was this information sent
    directly to the White House, circumventing regular Intelligence
    Community channels?
        Secretary Rumsfeld. No.

        86. Senator Kennedy. Secretary Rumsfeld, was it used in White House
    speeches and statements?
        Secretary Rumsfeld. You'll have to ask the White House how speeches
    and statements were researched.

                              questionable sources
        87. Senator Kennedy. Secretary Rumsfeld, according to critics like
    Ken Pollack, a former analyst and supporter of the war in Iraq, OSP
    chose to believe reports that trained intelligence officers considered
    unreliable or downright false. Pollack further states that OSP gave
    great credence to reports from INC and its administration-backed
    leader, Ahmed Chalabi, because the INC was telling the administration
    what it wanted to hear. Do you agree with that assessment? As a long-
    time and practiced intelligence consumer, isn't one of the cardinal
    rules of the business to abstain from wishful thinking?
        Secretary Rumsfeld. I do not agree with that assessment. The DIA
    considered the INC's Information Collection Program a reliable source
    of intelligence. That intelligence went through the normal Intelligence
    Community review. Another cardinal rule of intelligence is to never
    rely on a single source of analysis.

        88. Senator Kennedy. Secretary Rumsfeld, did OSP pass raw
    intelligence to the White House, and, specifically to the Vice
    President's office, or did OSP pass only finished all-source evaluated
    intelligence that contained an assessment of the reliability of the
    sources upon which it was based?
        Secretary Rumsfeld. No, to neither. OSP was a consumer, not a
    provider of intelligence.

        89. Senator Kennedy. Secretary Rumsfeld, did DCI George Tenet, who
    oversees the Intelligence Community, ever express concern to you, or
    that you became aware of, regarding OSP's role? If so, what were his
    concerns?
        Secretary Rumsfeld. No.

        90. Senator Kennedy. Secretary Rumsfeld, why did you close OSP last
    summer?
        Secretary Rumsfeld. The office is not closed. It has simply
    returned to its original name.
        The Directorate of Special Plans (often referred to as the OSP) was
    an expansion of that part of the NESA that dealt with Iraq and Iran. It
    was called ``Special Plans'' because we did not want to undercut the
    President's diplomatic efforts in the United Nations and elsewhere with
    respect to Iraq by attracting attention to the fact that the part of
    NESA that dealt with Iraq was being expanded.
        This Directorate was an expansion of the Northern Gulf Directorate
    within NESA in September 2002. It was established due to the increased
    workload related to the war on terrorism and to what was then a
    possible Iraq contingency. Once the administration decided to proceed
    with the liberation of Iraq, it was decided to change the designation
    of this Directorate back to its previous name of the NESA Northern Gulf
    Affairs Directorate.

        91. Senator Kennedy. Secretary Rumsfeld, you're a great fan of
    lessons learned exercises. Given the OSP's controversial role, have you
    asked that the OSP concept be the subject of a lessons learned
    exercise? If so, what have you learned? If not, why not?
        Secretary Rumsfeld. I do not consider controversy (or the lack
    thereof) as an indicator of the effectiveness of an office. Such
    controversies seldom have anything to do with the facts involved in a
    matter and are not a sufficient reason for in-depth reexamination of
    every decision.

                            iraqi national congress
        92. Senator Kennedy. Secretary Rumsfeld, did the Pentagon oversee
    the INC's own intelligence collection program?
        Secretary Rumsfeld. [Deleted.]

        93. Senator Kennedy. Secretary Rumsfeld, did the U.S. fund INC's
    collection effort?
        Secretary Rumsfeld. [Deleted.]

        94. Senator Kennedy. Secretary Rumsfeld, what did the Pentagon's
    oversight consist of, and what was the purpose of the INC's collection
    program?
        Secretary Rumsfeld. [Deleted.]

        95. Senator Kennedy. Secretary Rumsfeld, how many Iraqi defectors
    did the INC produce?
        Secretary Rumsfeld. [Deleted.]

        96. Senator Kennedy. Secretary Rumsfeld, who at the Pentagon was in
    charge of the defectors program and responsible for vetting each
    defector for reliability?
        Secretary Rumsfeld. [Deleted.]

        97. Senator Kennedy. Secretary Rumsfeld, how many INC-produced
    defectors did you judge to be reliable?
        Secretary Rumsfeld. The DIA Defense HUMINT Service made those
    judgments--as they do with all foreign intelligence programs.

        98. Senator Kennedy. Secretary Rumsfeld, how was reliability
    determined? For example, did you polygraph them? If so, how many of
    those polygraphed showed deception?
        Secretary Rumsfeld. The reliability of any intelligence data
    presented to me or to other policy makers is determined by the
    professionals of Intelligence Community. The DIA treated the data
    obtained from the INC Information Collection Program in exactly the
    same way it treated any other intelligence source information,
    processing it in accordance with long-established vetting procedures
    used throughout the Intelligence Community.

        99. Senator Kennedy. Secretary Rumsfeld, did the Intelligence
    Community share your views on INC defector reliability? If not, why
    not?
        Secretary Rumsfeld. Assessing defector reliability is something
    which the Intelligence Community has decades of extensive experience.
    The reliability of any intelligence data, of the reliability of what a
    putative defector's information might be, is presented to me after
    having been determined by the professionals of the Intelligence
    Community. The DIA treated the data obtained from the INC Information
    Collection Program in exactly the same way it treated any other
    intelligence source information, processing it in accordance with long-
    established vetting procedures used throughout the Intelligence
    Community.
        [Deleted.]

        100. Senator Kennedy. Secretary Rumsfeld, given the apparent
    inaccuracy of much of the information the INC-produced defectors
    provided, have you initiated a lessons learned exercise to determine
    how this inaccurate intelligence was not detected and how, in some
    cases, it found its way to policymakers?
        Secretary Rumsfeld. Your premise that ``much of the information the
    INC-produced defectors provided'' is inaccurate, is itself not correct.
    [Deleted.]
        There are many other examples of good information that the INC
    Information Collection Program has provided. Here are a few categories:
        [Deleted.]
                                     ______

                 Questions Submitted by Senator Daniel K. Akaka
                               service readiness
        101. Senator Akaka. General Pace, the Army is planning to go to a
    unit manning system, which will result in a cycle of very ready units
    for a period of time and will then ``stand down'' for a period of time
    before reconstituting themselves with new personnel. The Navy has begun
    to implement the Fleet Response Plan (FRP) that attempts to raise the
    average level of readiness over time, but will minimize the readiness
    ``peaks and valleys'' of the previous inter deployment training cycle.
    It seems that the Navy is moving to a system that will produce Army-
    like readiness cycles at the same time that the Army is moving to a
    readiness cycle that is more like the Navy's. Also, these proposals
    seem to be ``bottom up'' and have come from Service initiatives
    designed for various purposes. Has the Joint Staff looked at the impact
    of these changes and whether it is sound to have the Services heading
    in opposite directions on this issue?
        General Pace. Although seemingly divergent, both Services are
    actually converging on concepts to transform from Cold War paradigms to
    more continental U.S. (CONUS)-based, highly mobile and rapidly
    deloyable constructs. This would support anticipated continued high
    tempo of operations (OPTEMPO), while increasing overall force readiness
    and reducing unit stress. Already a core capability of the Marine
    Corps, the Air Force's Air Expeditionary Force concept supports this as
    well.
        Navy forces currently deploy under the Global Naval Force Presence
    (GNFPP), which is a Secretary of Defense-approved rotational schedule.
    The Navy's FRP would provided sustained rotational forward deployed
    forces ``on demand,'' while affording a significant surge response for
    contingencies (six Carrier Strike Groups within 30 days, plus two
    additional as follow-on forces). This would enable the Navy to maintain
    more forces at a higher level of readiness.
        The Army has traditionally worked from a ``steady-state'' concept
    where it deployed forces when needed for emerging crises/missions,
    while maintaining a large forward-based presence. The Army concept,
    still very early in development, would use scheduled unit rotations
    into and out of forward-based locations, so it would be similar to
    GNFPP in that regard. The intent of the Army's concept would be to
    provide a predictable deployment schedule, preserve a ready surge-
    capability for contingencies, and reduce the overall footprint of
    permanently forward-based forces.

        102. Senator Akaka. General Pace, what will the impact be on the
    Services' ability to provide ready units to combatant commanders?
        General Pace. Both initiatives are being developed in close
    coordination with the Joint Staff and Joint Forces Command (JFCOM) with
    readiness, sustainment, Global Force Management, and, most importantly,
    warfighting effectiveness issues in the forefront.

        103. Senator Akaka. General Pace, your statement says, ``When units
    return home from combat operations, they must undergo a reconstitution
    process, which generally means a drop in their readiness. However, this
    does not necessarily indicate that a unit is either unavailable for, or
    incapable of, executing part or all of their assigned wartime
    missions.'' My understanding of the term ``readiness'' is that it is
    generally used as shorthand for ``readiness to execute wartime
    missions.'' Are you using the term in some other way? If not, how does
    a drop in readiness not equate to a reduced ability to execute assigned
    missions, either in whole or in part?
        General Pace. A reduction in readiness does mean a unit has a
    reduced ability to execute its wartime mission, as was stated. But that
    does not mean the unit is necessarily unavailable for tasking, or that
    a unit is not capable of executing all or portions of its wartime
    mission. A unit could be tasked to execute only the portions of its
    wartime mission for which it is ready. Or it could be augmented with
    equipment and/or manning, termed ``cross-leveling,'' to quickly
    increase its readiness status for deployment/employment. Or a unit
    could simply be tasked to execute its wartime mission at a reduced
    readiness level, but with a commensurate higher risk to mission
    accomplishment.

        104. Senator Akaka. General Pace, if drops in readiness do not
    necessarily mean that units can't perform their missions, what system
    are you using to evaluate what their true capabilities are?
        General Pace. Chairman, Joint Chiefs of Staff Instruction (CJCSI)
    3401.02, Global Status of Resources and Training System (GSORTS),
    governs the readiness system used by DOD. GSORTS provides a monthly
    assessment of selected unit status indicators (personnel, equipment/
    supplies, equipment condition, training) and includes a commander's
    subjective assessment on the unit's ability to execute the mission(s)
    for which it was organized or designed.
        Unit readiness status is reported as C-1 through C-5:

            C-1--Unit possesses required resources and is trained to
            undertake its wartime mission(s).
            C-2--Unit can undertake portions of its wartime mission(s), but
            may have reduced flexibility and could require some
            compensation for deficiencies.
            C-3--Unit can undertake many, but not all, portions of its
            wartime mission(s), with significantly reduced flexibility and
            required compensation.
            C-4--Unit requires additional resources/training to undertake
            its wartime mission(s), but may be directed to undertake
            portions of its wartime mission(s).
            C-5--Unit is undergoing Service-directed resource action and is
            prepared to undertake wartime mission(s).

                       improving overseas training ranges
        105. Senator Akaka. Secretary Rumsfeld, I know that the budget
    request assumes that most of the changes in overseas presence will
    occur in concert with BRAC, and, therefore, that most of the associated
    funding will not be required until fiscal year 2006. However, it
    appears that a decision has been made to make greater use of overseas
    training ranges, and I understand that many of these ranges are fairly
    primitive and undeveloped. How much do you anticipate will be required
    to expand and improve overseas ranges to support the new presence
    policy?
        Secretary Rumsfeld. There have been no decisions yet on any aspect
    of the proposed global posture changes, so it is premature to speculate
    where we may use overseas training ranges in the future. We will indeed
    seek the use of overseas ranges where such use provides us unique
    training opportunities, supports our security cooperation priorities,
    and helps with the transformation process of our allies and partners.
    However, we are still analyzing the advantages and cost implications of
    combatant commander proposals and therefore cannot speculate on exact
    requirements for such ranges.

        106. Senator Akaka. Secretary Rumsfeld, are any funds for this
    purpose included in the fiscal year 2005 budget request, and, if not,
    when do you expect they will be required?
        Secretary Rumsfeld. Any fiscal year 2005 budget proposals related
    to overseas training ranges are connected to ongoing service
    initiatives, and separate from the broader Global Posture Review. An
    example is the Army's Efficient Basing Graffenwoer initiative. Because
    we are still conducting our posture review, we cannot speculate on when
    any new funding requests related to future use of overseas training
    ranges will be forthcoming.
                                     ______

                   Questions Submitted by Senator Mark Pryor
            tax-free treatment of military personnel in combat zones
        107. Senator Pryor. Secretary Rumsfeld, I would like to again
    commend you for addressing family housing in the DOD's fiscal year 2005
    budget. This is an issue which I believe is close to the hearts of our
    military personnel. I want to work with you to ensure that our military
    is fairly compensated. I understand that under the tax code, military
    pay is given tax-free treatment while the soldier, sailor, airman, or
    marine is serving our Nation in a combat zone. Congress provided this
    tax-free treatment because of the sacrifice these men and women are
    making to their country. However, the exclusion of combat pay has
    penalized some military personnel with families by limiting the
    benefits of the earned income and child tax credits. In some cases, our
    military personnel with families lose as much as $4,000 in these tax
    credits because they are serving our Nation. Do you see this as a
    problem, and is this something that should be addressed this year?
        Secretary Rumsfeld. Yes, the DOD agrees that this is a problem. In
    the summer of 2003, my staff began working with representatives from
    the Treasury Department and the Internal Revenue Service on a solution
    that will prevent service in a combat zone from interfering with a
    service member's eligibility for tax credits. The solution requires
    legislation. The DOD would like to see this issue addressed this year
    and is working with the Treasury Department to alleviate this
    unintended tax consequence to the Service members serving in combat
    zones.

                                  halliburton
        108. Senator Pryor. Secretary Rumsfeld, I have heard from many
    constituents concerned about defense contracts to Halliburton. Three
    recent news stories indicate that Halliburton over-billed $28 million
    for food services at five different food service facilities, that
    Halliburton overbilled for gasoline, and that Halliburton overbilled
    $6.3 million for unspecific services. Which, if any, of these contracts
    were competitively bid?
        Secretary Rumsfeld. Two prime contracts are represented here. The
    first contract is known as the Logistics Civil Augmentation Program
    (LOGCAP III) contract. It covers the referenced ``food services'' and
    ``unspecific services.'' This contract was awarded on the basis of
    competitive procedures. The second contract is a sole source contract
    for fuel. It covers the referenced ``gasoline.'' This contract has
    since been replaced with contracts awarded using competitive
    procedures. The $6.3 million represents a voluntary disclosure and
    refund from a subsidiary of Halliburton: Kellogg, Brown, and Root on
    the original fuel contract. This apparent overbilling and the others
    are presently being investigated.

        109. Senator Pryor. Secretary Rumsfeld, how many noncompetitive DOD
    contracts have been awarded to Halliburton in the last 3 years?
        Secretary Rumsfeld. In the last 3 years, DOD awarded Halliburton 80
    contract actions on a noncompetitive basis and 1,732 contract actions
    on the basis of competitive procedures.

        110. Senator Pryor. Secretary Rumsfeld, what penalty does
    Halliburton face for overbilling the DOD?
        Secretary Rumsfeld. When an overbilling is identified, the
    government auditor immediately notifies the contractor, the
    government's disbursing officer, and the government's contracting
    officer. The overbilled amount is deducted from subsequent contract
    payments. Other possible remedies (criminal, civil, contractual, or
    other) for overbilling will depend upon the reasons for the
    overbilling, as determined by various investigations.

                   business management modernization program
        111. Senator Pryor. Secretary Rumsfeld, you have proposed in your
    budget an effort to implement the Business Management Modernization
    Program (BMMP). I understand that the program would overhaul the DOD
    management processes, consolidate and integrate information systems,
    and facilitate auditable financial statements. Will BMMP help to
    prevent the billing problems we have seen with Halliburton in the
    future?
        Secretary Rumsfeld. The BMMP is transforming business processes to
    implement common processes, data, and controls. BMMP will improve the
    business of the Department as a whole.

        112. Senator Pryor. Secretary Rumsfeld, do we have to wait for the
    passage of the fiscal year 2005 bills to implement the BMMP?
        Secretary Rumsfeld. The answer to your question is no. We don't
    have to wait for the fiscal year 2005 bill to implement BMMP.

                     iraqi wmd/recommendation to go to war
        113. Senator Pryor. Secretary Rumsfeld, Secretary of State Colin
    Powell stated in an interview with The Washington Post that he might
    have made a different recommendation on war with Iraq, if he had known
    that Iraq had no prohibited weapons. If you knew Iraq had no, or
    little, WMD, would you still have recommended military action? If yes,
    please articulate the threat. If no, please elaborate.
        Secretary Rumsfeld. Dr. David Kay states unequivocally in his
    ``Interim Progress Report on the activities of the Iraq Survey Group
    (ISG)'' that there were prohibited weapons programs in Iraq and that
    Saddam was in violation of the U.N. Security Council resolutions
    regarding weapons of mass destruction. In addition, by expelling UNSCOM
    he clearly showed his contempt for the U.N. and international norms. It
    is also a fact that Saddam's regime sheltered and met with terrorists
    over the course of the 1990s and into the new century.
        As the President has said, he ``will not wait on events while
    dangers gather.'' The Saddam regime was dangerous, in clear violation
    of U.N. Security Council Resolutions regarding WMD, and was a state
    sponsor of terrorism. In light of these facts, there does not seem to
    be a need to reexamine the decisions that led to the liberation of the
    people of Iraq.

        [Whereupon, at 12:40 p.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                           TUESDAY, FEBRUARY 10, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

                                 SERVICE CHIEFS

        The committee met, pursuant to notice, at 9:31 a.m. in room
    SR-325, Russell Senate Office Building, Senator John Warner
    (chairman) presiding.
        Committee members present: Senators Warner, McCain, Allard,
    Sessions, Collins, Talent, Chambliss, Dole, Levin, Kennedy,
    Lieberman, Reed, Akaka, Bill Nelson, E. Benjamin Nelson,
    Clinton, and Pryor.
        Committee staff members present: Judith A. Ansley, staff
    director; and Leah C. Brewer, nominations and hearings clerk.
        Majority staff members present: Charles W. Alsup,
    professional staff member; L. David Cherington, counsel; Regina
    A. Dubey, research assistant; Brian R. Green, professional
    staff member; William C. Greenwalt, professional staff member;
    Ambrose R. Hock, professional staff member; Gregory T. Kiley,
    professional staff member; Thomas L. MacKenzie, professional
    staff member; Elaine A. McCusker, professional staff member;
    Lucian L. Niemeyer, professional staff member; Lynn F. Rusten,
    professional staff member; Joseph T. Sixeas, professional staff
    member; Scott W. Stucky, general counsel; Diana G. Tabler,
    professional staff member; and Richard F. Walsh, counsel.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; Daniel J. Cox, Jr., professional
    staff member; Madelyn R. Creedon, minority counsel; Richard W.
    Fieldhouse, professional staff member; Creighton Greene,
    professional staff member; Maren R. Leed, professional staff
    member; Gerald J. Leeling, minority counsel; and William G.P.
    Monahan, minority counsel.
        Staff assistants present: Sara R. Mareno, Nicholas W. West,
    and Pendred K. Wilson.
        Committee members' assistants present: Cord Sterling,
    assistant to Senator Warner; Christopher J. Paul and Dan
    Twining, assistants to Senator McCain; Jayson Roehl, assistant
    to Senator Allard; Arch Galloway II, assistant to Senator
    Sessions; Derek J. Maurer, assistant to Senator Collins;
    Lindsey R. Neas, assistant to Senator Talent; Clyde A. Taylor
    IV, assistant to Senator Chambliss; Meredith Moseley, assistant
    to Senator Graham; Christine O. Hill, assistant to Senator
    Dole; Mieke Y. Eoyang and Jarret A. Wright, assistants to
    Senator Kennedy; Terrence E. Sauvain, assistant to Senator
    Byrd; Frederick M. Downey, assistant to Senator Lieberman;
    Elizabeth King, assistant to Senator Reed; William K. Sutey,
    assistant to Senator Bill Nelson; Eric Pierce, assistant to
    Senator Ben Nelson; Andrew Shapiro, assistant to Senator
    Clinton; and Terri Glaze, assistant to Senator Pryor.

           OPENING STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner. Good morning, everyone.
        We start today's hearing by first welcoming back one of the
    members who has been absent without leave (AWOL), the
    distinguished Senator from Connecticut. If you would like to
    take a moment to explain your absence, we would be glad to have
    your views.
        Senator Lieberman. Well, Mr. Chairman, thanks for welcoming
    me back. It was quite a journey. I feel as if I was actively
    deployed and now I am returning to my home base. I appreciate
    very much the opportunity to return.
        I do want to say very briefly that along the way in this
    journey I met a number of families who have service members on
    active duty in Iraq, and I met some of the service members
    themselves who had returned. The level of pride and morale is
    extremely high. Cutting through all the natural debate that
    goes on about the war, it was very reassuring.
        If you will allow me, I carry this around with me because
    we lost Anthony De Agostino from Waterbury, Connecticut, and I
    was in touch with his folks and they sent me a mass card after
    the funeral. The father sent me this note: ``Dear Senator
    Lieberman: Please continue to support all our men and women in
    uniform. Please keep America the true leader of peace in the
    world. Tony was our only son, our only legacy. Although this
    was a great loss to our family, we wish you godspeed in making
    the world a safer place.''
        I had the honor to go on my own journey across America, but
    these are the real heroes. I wanted to say this in front of you
    and the Service Chiefs, with great honor and admiration. I
    return to work with you and Senator Levin with a sense of
    purpose to work on the critically important work of this
    committee, to make sure that we complete the mission we started
    with success, and to return our service men and women home as
    soon as possible in peace, and in what I would describe as
    victory.
        I thank you for your welcome. I promise not to give
    extended remarks any other time you call on me.
        Chairman Warner. No, that is all right. We are very
    appreciative of your sentiments. I recall vividly when you
    first joined this committee and you were one of the principal
    co-sponsors of the resolution in 1991 to authorize the use of
    force against Iraq. You were a member of the four of us who
    were co-sponsors in the recent resolution. You have always been
    a very strong voice on behalf of the men and women of the Armed
    Forces, and I appreciate your sentiments that we should
    complete this mission with a measure of unquestioned success.
        Your statement is so powerful that I am thinking about
    waiving mine, but I think I will go ahead.
        We meet today to receive the annual testimony of the
    Service Chiefs on the posture of each of our military services
    and on their respective portions of President Bush's defense
    budget request for fiscal year 2005 and the Future Years
    Defense Program (FYDP). We have a great team before us today,
    military men of great distinction and humility, men who have
    served this Nation well during previous conflicts, in most
    instances combat conflicts. Equally important, if not of
    greater importance, today in this global war on terrorism you
    bring to bear that vast experience that each of you have.
        Thank you for what you do every day for our men and women
    in uniform and their families. It has been a challenging year
    for our military. You have provided the leadership they need to
    successfully accomplish their mission and to understand just
    how important their service is to the security of the United
    States and indeed to the whole free world.
        I start by recognizing the extraordinary professionalism
    and courage of the men and women of our Armed Forces. In this
    past year, together with a coalition of nations, they freed
    Iraq from the tyrannical rule of Saddam Hussein. They are
    valiantly fighting today in Afghanistan and other far-flung
    points on the globe.
        In Iraq they did this mission quickly, with precision, and
    with casualties well below the estimates. This is proof of the
    training, equipment, readiness, and inspiration that you
    individually and collectively have provided your forces. Their
    sacrifices and the sacrifices of their families are deeply
    appreciated by every citizen in this Nation, most particularly
    the sacrifices of those families who lost their loved ones, and
    those families who welcomed home those who bear the wounds of
    war. I ask you to communicate one message to the uniformed
    service members and their families that you represent: America
    is proud of you.
        We need not let the critics of the moment diminish the
    importance of what our military has accomplished. In my
    opinion, there is no doubt that a very dangerous threat has
    been removed. The United States and indeed the world is a safer
    place because of the efforts of our military and coalition
    partners in Iraq.
        The Nation will continue, as it should, the debate over
    whether or not Saddam Hussein had large stockpiles of weapons
    of mass destruction (WMD), and the debate on other issues
    relative to the WMD program. However, not all the facts are in
    on the specific issue of stockpiles and on the other issues. We
    cannot reach final judgments and conclusions. We have upwards
    of 1,300 men and women in uniform together with many other
    civilians still as a part of the Iraq Survey Group (ISG) who
    are continuing that mission.
        What we do know at this point is as follows: We know that
    Saddam Hussein was indeed a threat. He has used WMD on his
    neighbors and on his own people, and he was maintaining his
    capability to quickly produce these weapons. Clearly he had
    breakout capability on a range of weapons, some of mass
    destruction.
        We know that Dr. Kay testified that Saddam Hussein had
    restarted Iraq's nuclear weapons program. Although there are no
    estimates, it was a matter of time until he acquired some
    measure of capability with those awesome, ultimate weapons of
    mass destruction.
        We know that Iraq was continuing research and development
    (R&D) on chemical and biological weapons, and had an active
    program to use the deadly chemical ricin as a weapon. We know
    that Iraq was developing and producing ballistic missiles that
    clearly violated United Nations (U.N.) Security Council
    mandates that were imposed following the first Gulf War.
        As Dr. Kay told this committee 2 weeks ago, and I quote
    him: ``It was reasonable to conclude that Iraq posed an
    imminent threat. What we learned during the inspection made
    Iraq a more dangerous place potentially than in fact we thought
    it was even before the war.'' Our military men and women in
    uniform under your leadership, have removed this threat.
        There have been allegations that the President and his
    senior advisers manipulated and exaggerated the prewar
    intelligence on Iraq. I personally have seen no clear and
    convincing evidence of this. In fact, many of the basic
    conclusions reached by President Bush, Vice President Cheney,
    and others, are entirely consistent with the basic conclusions
    of officials in the previous administration. I have with me
    today a whole series of those quotes.
        An examination of United States intelligence, intelligence
    of other nations, and reports in the U.N., combined with Iraq's
    past history, led 77 members of this body, the United States
    Senate, to basically reach the same conclusions that two
    administrations' senior officials had reached: Saddam Hussein
    represented a great threat that had to be confronted with
    military force.
        Diplomatic efforts were tried repeatedly and failed. The
    last of 18 U.N. Security Council Resolutions, 1441, passed
    unanimously by 15 members of the Security Council on November
    8, 2002, found Iraq to be ``in material breach of its
    obligations'' that the U.N. Security Council had set down. The
    council then specifically said ``the final opportunity to
    comply with its disarmament obligations is before Iraq'' and
    warned of serious consequences if Saddam Hussein failed to
    comply. He did not comply.
        Before us today are the leaders of our four military
    Services, three of whom were at their current positions at the
    start of Operation Iraqi Freedom (OIF). Now, the Goldwater-
    Nichols Act, which I brought with me today, fundamentally
    reshaped the duties and responsibilities of the Chiefs and then
    the body of the Joint Chiefs, including special provisions to
    ensure that any dissenting opinions from the members of the
    Joint Chiefs of Staff could reach the President. I direct you
    to section 151, title 10, subsection D, ``Advice and Opinions
    of Members Other than Chairman.''
        I think it is appropriate, since this is your first
    appearance as a group before this committee since the
    commencement of hostilities, that each of you in your opening
    statements, with your exception, General Schoomaker,
    specifically advise this committee. There is a presumption
    raised by Goldwater-Nichols that you had the opportunity to
    approach the President and indeed the Chairman of the Joint
    Chiefs and others if you had any doubts concerning the
    advisability of the use of force at the time it was used
    against Iraq, and this is that opportunity today.
        I think it is very important for America to understand how
    their professional military leaders felt about the decision to
    go to war before the use of force, and also how they feel today
    in light of revelations about certain portions of our
    intelligence. This is that opportunity.
        Operations continue in Iraq, Afghanistan, and elsewhere in
    the global war on terrorism. The circumstances of our times
    demand, however, that we not rest on the laurels of our recent
    successes. We must prepare now for the future, a future fraught
    with new challenges and new dangers.
        The President's budget request anticipates this uncertain
    future. The fiscal year 2005 budget request for the Department
    of Defense (DOD) of $401.7 billion represents a 5-percent
    increase over the fiscal year 2004 authorized level and the
    fourth consecutive year of growth in the defense budget.
        Much is being asked of each military Service. You have all
    been looking for better and more efficient ways to use each
    taxpayer dollar, from developing new capabilities to changing
    concepts of operations to better integrating the very valuable
    National Guard and Reserve Forces that we have in this Nation.
    We look forward to hearing about your initiatives and welcome
    your insights on the challenges that you face.
        Senator Levin.

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman.
        First let me join you in welcoming back our friend Joe
    Lieberman. He in his own way has been serving the Nation, both
    in the campaign that he just waged and also in his
    extraordinarily fine service here in the United States Senate,
    the civility, the thoughtfulness which he brings to his every
    task that he undertakes. I just want to join you, Mr. Chairman,
    I know speaking for every member of this committee, in
    welcoming Joe home.
        As we meet today, America's Armed Forces are heavily
    engaged in trying to bring stability to Iraq. Additionally,
    almost 40,000 more stand on the front lines in Korea, within
    range of North Korean artillery and rockets. Thousands of
    American troops are risking their lives every day in continued
    operations in the global war on terrorism in Afghanistan and
    other hot spots around the world. Of course, many more continue
    to work to keep the peace and to build a more stable future in
    the Balkans and elsewhere.
        To support these efforts, the President has already called
    up nearly 190,000 members of the Reserve components to active
    duty. Given the presence of all of our Service Chiefs, we all
    want to extend to those men and women serving us and through
    our Service Chiefs our thanks to both active duty and Reserve
    Forces for the work that they are doing with bravery and
    dedication on behalf of all Americans.
        I also want to note that they and their families are making
    sacrifices for all of us and that there are stresses and
    strains on all of them, and that the military is stretched
    thin.
        Mr. Chairman, you have made reference to the inquiry into
    intelligence failures prior to the war. It is essential that
    there be an inquiry into massive intelligence failures relative
    to the presence of WMD in Iraq. It was the presence of those
    weapons which was given as the reason for urgency in proceeding
    to attacking Iraq. It is essential that there be an inquiry
    made into the way in which our intelligence was projected and
    represented by our policymakers, and it is essential that there
    be an inquiry made into the planning which either existed or
    did not exist relative to the post-Saddam period as to what we
    could expect in that period and how we would address it.
        Whatever we determine about those issues, let nobody doubt
    that those who ask those questions, all of us, stand four-
    square behind our men and women who serve our Nation around the
    world. We will provide our men and women in uniform with
    everything that they need to ensure that they succeed in their
    mission. People who are asking the questions about intelligence
    so that our future intelligence and decisions are better are
    just as determined to help us succeed in our mission and to
    give our men and women in uniform everything they need to
    achieve that success as persons who are taking different
    positions relative to those inquiries.
        The budget before us represents a peacetime budget. It
    fails to include funding to pay for the incremental costs of
    operations in Iraq and Afghanistan. So while the exact costs of
    those operations in fiscal year 2005 are not presently known,
    many of the costs can be readily estimated.
        I want to just emphasize this so that everyone understands
    what I have said. The budget before us does not include items
    that we know have to be paid for, and should be paid for and
    will be paid for, in terms of supporting our men and women and
    giving them all the resources that they need. Now, some of
    those costs, although they are not included in this budget, can
    be readily estimated and should be estimated at this time.
        For instance, we know that forces are going to be rotating
    into and out of Iraq in the October time frame, just after the
    beginning of fiscal year 2005. It is my understanding again
    that these costs are not in the budget. But this, coupled with
    the announced policy of the administration of not asking for a
    supplemental appropriation for the DOD this calendar year, is
    going to result in forcing the Services to plan on supporting
    deployed operations from within the normal budget, at least for
    several months.
        That puts the Services, it seems to me, in a very difficult
    position. I would be interested in hearing from our witnesses
    this morning about the measures that they may have to take if
    they are to live within these constraints until a supplemental
    appropriation is requested next January.
        The U.S. military is by far the best trained, best
    equipped, most capable fighting force in the world today. Its
    readiness can be attributed in large measure to the hard work
    that the Service Chiefs and their staffs have put forward in
    support of their responsibilities mandated by title 10, U.S.
    Code, to organize, train, and equip their respective Services.
    We are going to do everything we can to ensure that our
    military remains the best, and it is to that end that we are
    going to be exploring some critical issues with the witnesses
    before us today and other witnesses who will be called before
    this committee.
        So, Mr. Chairman, I want to join you in welcoming our
    witnesses today. I want to thank them for their service, for
    their leadership. It has made a critical difference during
    these very difficult times. I want to give a special welcome to
    General Schoomaker, who is making his first appearance as our
    Army Chief of Staff before the committee at a posture hearing.
    Welcome, all of you.
        Chairman Warner. Thank you very much, Senator Levin.
        General Schoomaker, as the senior Service, the Army, you
    may lead off.

      STATEMENT OF GEN PETER J. SCHOOMAKER, USA, CHIEF OF STAFF,
    UNITED STATES ARMY; ACCOMPANIED BY LTG STEVEN BLUM, USA, CHIEF,
                         NATIONAL GUARD BUREAU

        General Schoomaker. Thank you very much, Mr. Chairman. Good
    morning. Mr. Chairman, distinguished members of the committee.
    It is a pleasure to appear before you today. With your
    permission, I would like to submit the 2004 Army Posture
    Statement for the record.
        Chairman Warner. Without objection, it will be admitted to
    today's record in its entirety, together with the statements of
    the other members of the panel.
        General Schoomaker. Thank you, sir.
        I would like to begin by thanking each of you for the
    tremendous support you continue to show for our men and women
    in uniform, as witnessed by your statements this morning
    already.
        The fiscal year 2004 defense legislation and supplemental
    appropriation have provided our soldiers the tools they need to
    carry on their important, often dangerous work. The fiscal year
    2005 President's budget request provides our Army with the
    resources we need to meet the noncontingency requirements of
    the national security strategy. It fully funds our statutory
    end strength of 482,400 soldiers. It supports training
    requirements in accordance with our joint and combined arms
    training strategy.
        The budget request funds depot maintenance for the 15
    critical systems in our recapitalization program. It provides
    funds to upgrade barracks, family housing, and funds facilities
    sustainment at 95 percent.
        The budget request also provides for future readiness by
    funding upgrades for Stryker Brigade Combat Team 5 and our
    continuous investment in the Future Combat System (FCS).
        As with any budget, it reflects a balance. We have accepted
    risk in some lower priority depot maintenance, base operations,
    and other areas. The budget request does not fund our
    contingency requirements for OIF and Operation Enduring Freedom
    (OEF). We do not know with certainty what these requirements
    will be, but we will need a supplemental to fund them once they
    are known.
        All of this has been carefully weighed and I ask for your
    support of the fiscal year 2005 budget request.
        There is no question that the pace of our Nation at war
    challenges our Army. It is hard to recall a time in history,
    with the exception of World War II, when we have been busier,
    as we deploy and redeploy nearly a quarter of a million
    soldiers over the next 4 months. We continue to meet these
    challenges with the seamless commitment of active, Reserve, and
    National Guard soldiers who continue to give so selflessly to
    our great Nation. Accompanying me today are Lieutenant General
    Steve Blum, the Chief of the National Guard Bureau, and
    Brigadier General Gary Profit from the Office of the Chief of
    the Army Reserve. I appreciate their presence here today.
        Chairman Warner. Gentlemen, we welcome you to the hearing.
    Thank you.
        General Schoomaker. This is not easy and we cannot approach
    it as if it is business as usual. This state of war requires us
    to challenge old paradigms, to be flexible and adaptable. Using
    the authority provided by Congress and the flexibility you have
    built into our law, the Secretary of Defense and the President
    of the United States supported my request to temporarily grow
    the Army by up to 30,000 soldiers above its statutory end
    strength. I asked for your support as well.
        I appreciate the concern that many of you have shown over
    this issue. This temporary end strength increase is the right
    choice. A permanent increase in statutory end strength before
    the Army has implemented our ongoing force structure reforms
    would be inefficient and could jeopardize the future readiness
    of our Army.
        I have asked to temporarily grow the force under the
    authorities provided in title 10, section 123[a] because the
    real issue we must address is improving Army capabilities, by
    tailoring our structure to better meet the requirements of our
    national security strategy. Capability is the issue, not the
    number of soldiers. With the flexibility I have requested, we
    can grow the active component from 33 to 43 combat brigades
    while increasing the number of National Guard combat brigades
    that are identical to the Active Force.
        In the future we will make a decision on adding an
    additional five active component combat brigades to further
    enhance our capability. Combined with other initiatives, such
    as adjusting the balance between the active component and the
    Reserve component, increasing the pool of soldiers in high-
    demand specialties, and the implementation of unit modularity
    and stabilization, this restructure will provide the Nation and
    the Joint Forces Commanders with an Army better suited to meet
    rotational or readiness requirements such as we face today,
    while remaining ready to meet the challenges of the future.
        We must never lose sight of the fact that it is our
    soldiers who put it all on the line. We will do everything in
    our power to prepare them for the challenges they face. I could
    not be more proud of them and the professionalism, courage, and
    competence that they demonstrate every day. I would include our
    family members in that who have already been recognized. They
    pay a tremendous price and they are with us.
        In closing, I would like to thank this committee for the
    opportunity to appear before you today and for your continued
    support for the men and women in our Army, deployed in Iraq,
    Afghanistan, and throughout the world.
        I look forward to answering your questions. Thank you, sir.
        [The 2004 Army Posture Statement follows:]

        [GRAPHIC(S) NOT AVAILABLE TIFF FORMAT]

        Chairman Warner. Thank you very much, General.
        Admiral Clark.

         STATEMENT OF ADM VERNON E. CLARK, USN, CHIEF OF NAVAL
                               OPERATIONS

        Admiral Clark. Thank you.
        Chairman Warner and Senator Levin, distinguished members of
    the committee: Good morning to each of you. I very much
    appreciate the opportunity to be here this morning and to talk
    to you about your great Navy, the Nation's great Navy.
        It is also my privilege, like my friend General Schoomaker,
    to thank you, on behalf of the men and women of the United
    States Navy--the uniformed members, the civilian members,
    active and Reserve--for the support provided by Congress to
    make our Navy ready to respond to the issues that face us in
    the world today, and for helping us create the Navy of the
    future.
        The support of Congress in the face of difficult choices,
    choices that each of you must make each year, has made a
    difference to our people and to our Nation's defense. All of us
    in the Navy are very grateful for what you do.
        Of course, your Navy is just one part of an unparalleled
    joint warfighting team. I am also very grateful for these great
    partners that I am sitting here with today at this table. It
    has been my privilege to serve with these great professionals
    and I consider them the best of the best. We spend quite a bit
    of time together, oftentimes just the Joint Chiefs and
    sometimes with the Secretary. But I can tell you that this
    group of individuals is dedicated and committed to delivering
    the kind of joint operating concepts and transformational
    capabilities that this Nation needs for the future.
        We recognize that it will take all of us working together
    to bring the kind of joint capabilities that the Nation needs
    now and in the future.
        I have outlined, Mr. Chairman, in some detail our Navy's
    accomplishments over the last year in my written statement. So,
    in the interest of time, I will not dwell on them here, except
    to say that this has been an incredible year for our Navy. Your
    Navy was built to take credible, persistent, combat power to
    the far corners of the Earth, anywhere, any time the Nation
    needs us to take it there. Our operations this past year have
    proved again the value of being truly ready to meet combat and
    ready to perform combat operations.
        At the height of OIF, 7 of our carriers were deployed, 7 of
    our 10 air wings, and 75 percent of our amphibious structure.
    In total, 55 percent of our fleet was deployed overseas.
        This last year proved again the importance and the need to
    exploit the vast maneuver space provided to us and the
    independence to operate from the seas. Most importantly, it
    proved once again that our Navy's actions this year highlighted
    the asymmetric advantages that we possess in this country. That
    is the ability to deploy unparalleled technology and the genius
    of our people. The things that you have said about our young
    men and women are greatly appreciated.
        With this year's budget request, we seek to accelerate our
    advantages into the future, to deliver the right readiness for
    this Nation at the right cost, to respond to the Nation's
    warfighting needs, to shape the 21st century workforce, to
    deepen our investment in the growth and development of our
    people, our number one asset, to accelerate our investment in
    our Seapower 21 vision, to recapitalize and transform our Navy,
    and to improve its ability to operate as part of the joint
    warfighting team.
        As General Schoomaker pointed out, this is not an easy
    task. Our budget request this year assesses the capabilities we
    need for today and tomorrow, and it balances the investment,
    and the key word here is ``balance.'' It balances the
    investments that we need so that we can take on the challenges
    and deal with acceptable risks.
        As I indicated to this committee last year, we seek to make
    improvements in our investments for the future. This year we
    are requesting procurement dollars for 9 new ships and 104
    aircraft. As a point of reference, that's 30 percent more than
    we projected in last year's budget. The key thing that I have
    spoken with this committee a number of times about is
    investment streams and the requirement to get the shipbuilding
    investment stream to the level that it needs to be.
        As a point of reference, the year I arrived in this post
    the account for the Navy shipbuilding and conversion (SCN) was
    $4.7 billion. We invest this year a little over $11 billion in
    new construction and in modernization of our force. I am proud
    of those improvements.
        Our investment in aircraft programs is significantly higher
    than it was 4 years ago as well. We have invested nearly $6
    billion in our 2005 budget request and this is almost double
    our investment in 2001. This does not include the investment of
    over $6.3 billion in aviation R&D. This number is triple what
    it was 3 years ago.
        We have focused these investments on important new
    capabilities. The heart of our future family of ships is the
    DD(X), the 21st century destroyer, a ship that will absolutely
    revolutionize naval fire support and almost everything that we
    know about shipbuilding. The DD(X) has a new, stealthy hull
    form; integrated electric drive and power generation system;
    modularity and enhanced human systems engineering will reduce
    manning, and it is estimated that that alone will save the
    taxpayers over $18 billion in the life of this program;
    leveraging the platform for future growth and spiral
    development. It will change the way we develop and construct
    ships and it will change the way we fight for the next half
    century. DD(X) starts this year.
        The EA-18G was brand new in the budget last year. This
    year's budget will greatly accelerate the recapitalization of
    the just plain old EA-6B, the Nation's only joint electronic
    attack capability. OIF and congressional action last year
    accelerated the aging process on this airplane. With your
    support this year means that relief is on the way, and it
    cannot happen too soon.
        We will commission the first Virginia class submarine later
    this year. Virginia will incorporate unmanned vehicles and the
    ability to plug into joint networks like no other submarine
    ever has in history. Congress' authorization for multi-year
    procurement of five of these submarines in last year's budget
    has helped make these important, complex platforms more
    affordable for the future.
        Of course there are others, like the Littoral Combatant
    Ship (LCS). We will award it with this year's budget. Our first
    new aircraft carrier in 3 decades, CVN-21, continues to be
    funded as well as a sea-based missile defense and a nuclear-
    powered cruise missile attack submarine (SSGN) and F-18E and
    Joint Strike Fighter (JSF), and the Advanced Hawkeye program.
    We accelerate our request for the LPD-17 class.
        We have other initiatives in this budget, like our Fleet
    Response Plan (FRP), mentioned the other day in front of this
    committee, that will deliver the right readiness and the
    ability to surge 50 percent more combat power than we have ever
    been able to do routinely in the past.
        General Pace described to you this transformational
    approach. It is a change in the way we organize, train, and
    equip our force. It means that we can surge this morning, if
    the President needs us, to six carrier strike groups anywhere
    we need to in the world.
        It is all about maximizing the investment that the
    taxpayers make in the Nation's defense. The bottom line is that
    we have framed in this budget the right current readiness at
    the right cost to the Nation, and for that I seek your support.
        Of course, at the heart of everything good that is
    happening in the Navy today is this: We are winning the battle
    for people. The momentum here is fantastic. The Navy has seen
    higher quality recruits, and the best retention that I have
    ever seen in my life. In fact, for the third straight year, it
    is the highest retention in the history of the United States
    Navy. This was made possible with innovative incentive pay
    pilot programs. We have experienced dramatically reduced
    attrition, competitive reenlistments in detailing and
    outstanding deckplate leadership. In short, this is the highest
    quality Navy this Nation has ever seen, and it is all about the
    people.
        The authorities you have granted us in this regard are
    incredibly important and in my view, have made the difference.
    I ask you to continue to give us the tools to be successful.
    These tools have been critical in our ability to attract,
    retain, and shape the kind of workforce we need for the future.
        I will say this, as I said last year: Manpower is never
    free. So in this budget I am suggesting and requesting that we
    reduce our end strength by some 7,900 people from the 2004
    levels. Our strategy for doing this is simple. We are capturing
    the work on our ships and stations, improving our training
    processes, leveraging technology advances, decommissioning our
    older, most manpower-intensive platforms where the risks allow
    us to do so, and rebalancing our Reserve and Active Forces in a
    way that delivers the right skills when we need them and
    reduces the personnel strain.
        I am committed, Mr. Chairman and members of this committee,
    to building a Navy that can maximize the capability of our
    people and minimize the total number on the payroll. We will
    continue to invest in our sailors' growth and development, and
    our ability to provide them meaningful and challenging careers
    that lets them make a difference. This is part of our covenant
    with them.
        As our Navy delivers the more high-tech systems that I
    mentioned, it is my intent for us to also develop a smaller yet
    smarter workforce. We will spend whatever it takes to equip and
    enable our sailors. We do not want to spend one extra penny for
    manpower that we do not need.
        There is a lot more to talk about, and we will in the
    closed hearing that follows.
        Mr. Chairman, in response to your question about my
    position and understanding and beliefs prior to OIF, I say
    this: As I watched the hearing the other day with the Secretary
    and General Pace, I watched the kind of questions that you were
    asking, and I thought about where we were at that point in time
    in our history. I asked the Secretary of Defense if I could
    read just part of a private correspondence that I sent to him
    on the morning we commenced combat operations.
        It is a private correspondence, I will not read the whole
    thing, but this part he said would be appropriate for me to
    share with you, and this was at my request. I started by
    telling him that we were ready. I said that the leadership in
    the fleet was confident. I said that our readiness was higher
    than I had ever seen it.
        Then I said this: ``For some this is about weapons of mass
    destruction, for others it is about al Qaeda. For us it is
    about all of that and more. Iraq has been shooting at our
    aircraft for over 5 years.'' I went on to say to him that it
    was my belief that this cause was just and our people believed
    in it. Mr. Chairman, that was my position then and that is what
    I believe today.
        I look forward to your questions and I thank you again for
    the opportunity to be here.
        [The prepared statement of Admiral Clark follows:]
                 Prepared Statement by ADM Vernon E. Clark, USN
        Mr. Chairman and members of the committee, I appreciate this
    opportunity to appear before you. I want to express my gratitude for
    the substantial investment you have made in making this Navy the best
    Navy the Nation has ever seen.
        Your Navy is built to take credible combat power to the far corners
    of this Earth, taking the sovereignty of the United States of America
    anywhere we need to take it and at anytime we choose to do so. It is
    capable of delivering the options this Nation needs to meet the
    challenges of today and it is committed to the future capabilities the
    joint force will need to win throughout the 21st century.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        It is a wonderful time to be a part of this Navy and a great
    privilege to be associated with so many men and women--active and
    Reserve, uniformed and civilian--committed to the service and defense
    of this Nation. I speak for all of our men and women in thanking you
    for your exceptional and continuous support.
      i: your navy today--projecting decisive joint power across the globe
        Your Navy's performance in Operations Enduring Freedom (OEF) and
    Iraqi Freedom (OIF) last year proved--more than anything else--the
    value of the combat readiness in which you have invested. It
    demonstrated the importance of the latest technology in surveillance,
    command and control, and persistent attack. It highlighted our ability
    to exploit the vast maneuver space provided by the sea. Most
    importantly, it reaffirmed the single greatest advantage we hold over
    every potential adversary: the genius of young Americans contributing
    their utmost in their service to this Nation.
        This past year, the fleet produced the best readiness levels I have
    seen in my career. We have invested billions of dollars to training,
    maintenance, spare parts, ordnance, flying hours and steaming days
    accounts these last few years, and that investment resulted in the
    combat ready response of more than half the Navy to operations
    worldwide.
        Seven aircraft carriers and 9 big deck amphibious ships were among
    the 164 U.S. Navy ships forward deployed last spring in support of OEF
    and OIF and contingencies worldwide. The Military Sealift Command
    sailed and chartered more than 210 ships and moved 94 percent of the
    Nation's joint and combined capability to the fight. We also deployed 3
    fleet hospitals, a hospital ship, 22 P-3 aircraft, 25 naval coastal
    warfare detachments and we mobilized more than 12,000 reservists.
        OIF and OEF were the most joint operations in our history and they
    have provided the best possible opportunity to dissect, study, and
    analyze some of the limiting factors and effects of how we fight.
    Beyond the mere numbers, these operations confirmed that we should
    continue to pursue the capabilities that enhance our power projection,
    our defensive protection and the operational independence afforded by
    the sea.
        While we recognize that we must continue to challenge all of our
    assumptions in a variety of scenarios, our lessons learned indicate
    that the capabilities-based investment strategies, new warfighting
    concepts and enabling technologies we are pursuing in our Sea Power 21
    vision are on the right vector. Let me give you some examples.

         The reach, precision, and persistence of our Sea Strike
    capability added lethality to ground combat engagements in Afghanistan
    and Iraq. The joint surveillance and attack technologies and processes
    that we have already put in place forced enemy combat formations to
    either disband and desert or be destroyed in place by precision
    weapons. Navy aviation generated more than 7,000 combat sorties in
    support of OIF, sometimes flying joint missions with land-based Air
    Force tankers more than 900 miles from their carriers. Surface
    combatants and submarines struck targets throughout Iraq with more than
    800 Tomahawk missiles. The initial deployments of new F/A-18E/F Super
    Hornet squadrons greatly extended our range, payload, and refueling
    options. We will realize more of these capabilities in the future
    through the conversion of the first of four Trident nuclear-powered
    ballistic missile submarines (SSBNs) into the nuclear-powered cruise
    missile attack submarine (SSGN) conventional strike and Special
    Operations Forces (SOF) platform.
         U.S.S. Higgins (DDG 76) provided early warning and
    tracking to joint forces in Kuwait and southern Iraq to help warn
    forces and defend against the threat of theater ballistic missiles.
    This tracking-only capability demonstrated the initial potential of
    extending Sea Shield defenses to the joint force. In a sign of things
    to come, we advanced our missile defense capability with another
    successful flight test of our developmental sea-based defense against
    short-to-medium range ballistic missiles. U.S.S. Lake Erie (CG 70) and
    U.S.S. Russell (DDG 59) combined to acquire, track, and hit a ballistic
    test target in space with an SM-3 missile in support of the ballistic
    missile defense program. This was the fifth success in six tests.
        Our OIF mine warfare efforts cleared 913 nautical miles of water in
    the Khor Abd Allah and Umm Qasr waterways, opening 21 berths in the Umm
    Qasr port and clearing the way for operations in the littoral areas of
    the Northern Persian Gulf and for humanitarian aid shipments into Iraq.
    These operations included the use of the High Speed Vessel X1 (Joint
    Venture), Navy patrol craft and six unmanned, autonomous underwater
    vehicles (AUVs) directly from our science and technology (S&T) program
    in the littoral for special operations and mine clearance operations,
    and gave us important insights into our vision for both future littoral
    and mine warfare concepts and capabilities.
         We projected joint combat forces across the globe with
    greater speed and agility than we have ever done in the past. Along
    with our number one joint partner, the United States Marine Corps, we
    put more than 60,000 combat-ready marines ashore in Kuwait in 30 days.
    The Navy's Military Sealift Command delivered more than 32 million
    square feet of combat cargo and more than 1 billion gallons of fuel to
    the Nation's warfighters in OEF and OIF. We were able to sustain the
    strategic and operational flexibility afforded by Sea Basing to
    generate a three-axis attack on Iraq from our dispersed aircraft
    carriers, surface combatants, and submarines in the Red Sea, the
    Mediterranean Sea, and the Persian Gulf.
        We forged ahead in our shipbuilding investments. We awarded three
    preliminary design contracts for the Littoral Combat Ship (LCS),
    leading to the construction of the first LCS in fiscal year 2005. We
    selected the baseline design for the DD(X) 21st century multi-mission
    destroyer, launched San Antonio (LPD 17), christened Virginia (SSN 774)
    and began fabrication of Makin Island (LHD 8) and Lewis and Clark (T-
    AKE 1).
         In OIF, we were able to know more, decide faster, and act
    more decisively than ever before. Our three-axis, multi-platform attack
    from the Persian Gulf, Red Sea, and Mediterranean Sea--as well as the
    geometric increases in striking power, defensive protection and speed
    of maneuver generated by our joint forces--is made possible by the
    power of joint command, control, communications, computers,
    intelligence, surveillance, and reconnaissance (C\4\ISR). Fully 80
    percent of targets struck with precision ordnance were unknown at
    aircraft launch. We developed and installed CENTRIX and COWAN networks
    to enhance joint and coalition interoperability on all of our deploying
    ships, and we also promulgated the FORCEnet campaign plan, defining the
    architecture and standards that will help us further integrate
    warriors, sensors, weapons, and platforms.
        These accomplishments this past year have taught us more about who
    we are and where we are headed. We know that the combat power of the
    truly joint force is much more than the sum of the Services'
    contributions. We understand the value of readiness and the importance
    we must place on improving the fleet's ability to respond and surge
    with decisive combat power. We relearned the lesson that over flight
    and basing is not guaranteed; our dominance of the maritime domain and
    our consequent ability to quickly deliver an agile combat force is a
    priceless advantage for our Nation. We reaffirmed that our people are
    now, and always will be, the root of our success.
              ii: your navy tomorrow--accelerating our advantages
        Readiness, advanced technology, dominance of the maritime domain,
    and the genius of our people--these are our asymmetric advantages. They
    are the core of our Sea Power 21 Navy and we intend to accelerate these
    advantages over the coming year. We are in a position to continue to
    build upon and recapitalize these strengths, to innovate and
    experiment, and to push the envelope of operational art and
    technological progress. Our ability to project persistent, sovereign
    combat power to the far corners of the Earth now and in the future
    depends on it.
        In last year's statement, I discussed principally the advantages
    brought by advanced technology and the vast maneuver area of the sea in
    our Sea Power 21 vision.

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        This year, I would like to spend a few moments on the efforts we
    have taken to improve our other advantages: our readiness to respond to
    the Nation's defense needs and the tools we will need to ensure the
    right people for our Sea Power 21 Navy.
        Today's naval forces and personnel are superbly trained and well
    provisioned with ordnance, repair parts and supplies. They are ready
    earlier--for a longer period of time--and they are deploying at a
    higher state of readiness than ever before. In short, the Navy this
    Nation has paid for is truly ready to accomplish its missions and it is
    more ready to do so than I have ever seen it in my career.
        I mentioned the results; in OIF, we surged more than half the fleet
    to fight half a world away. The combined power of our forward presence
    forces and those that we were able to surge overseas helped keep our
    enemies on the run. This conflict and our analysis of future campaign
    scenarios make it apparent that the readiness of both our forward
    forces and the forces that must surge forward will be critically
    important to our future. It is no longer good enough to be able to
    surge just once every 10 years or so.
        The war on terrorism and the unpredictability of the global
    security environment make this an immediate imperative. The Nation
    needs a Navy that can provide homeland defense and be both forward and
    ready to surge forward to deliver overmatching and decisive combat
    power whenever and wherever needed. We are committed to do so.
        With this in mind, we launched the Fleet Response Plan (FRP) this
    past year. The FRP resets the force in a way that will allow us to
    surge about 50 percent more combat power on short notice and at the
    same time, potentially reduce some of the personnel strain of forward
    rotations.
        In simplest terms, rather than having only two or three Carrier
    Strike Groups (CSGs) forward-deployed and properly equipped at any one
    time--and an ability to surge only a maximum of two more--the FRP
    enables us to now consistently deliver six forward deployed or ready to
    surge CSGs almost immediately, plus two additional CSGs in the basic
    training phase in 90 days or less. This FRP capability is commonly
    known as six plus two.
        To do this, we have fundamentally reconfigured our employment
    policy, fleet maintenance, deployment preparations and fleet manning
    policies to expand the operational availability of non-deployed fleet
    units. We have shifted the readiness cycle from one centered solely on
    the next-scheduled-deployment to one focused on returning ships to the
    right level of readiness for both surge and deployed operations. The
    net result is a fleet that is more ready, with more combat power--more
    quickly--than was possible in the past.

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        Our forward rotations remain critically important to our security,
    to strengthening alliances and coalitions, and to the global war on
    terrorism. But it is clear we must make these rotations with purpose,
    not just to fill the calendar.
        For example, implementing the new Proliferation Security Initiative
    to counter weapons of mass destruction (WMD) as a tool for terrorists
    and their sponsors is likely to involve the use of forward naval forces
    in maritime interdiction. Additionally, we plan to be ready to
    establish initial missile defense operations using forward-deployed
    Arleigh Burke class guided missile destroyers and their Aegis systems
    in Long-Range Tracking and Surveillance roles. Of course, we will
    continue to provide combatant commanders with the combat-credible,
    rapidly employable forward forces required for the Nation's defense.
        But at the same time, we recognize that our ability to rapidly
    surge significant additional combat power and provide a range of joint
    employment options is critically important to the swift and decisive
    combat operations that must be our future. The FRP allows us to do just
    that.
        We have an obligation to accurately assess the readiness needs and
    create the resources necessary to support this FRP capability. This has
    also been a major focus this past year.
        Readiness is a complex process. It is much more than a count of our
    end strength, our ordnance and spares, and the number of hours and days
    spent training. It is the product of our ability to deliver the
    required effects needed to accomplish the mission. We know too that
    readiness at any cost is unacceptable; as leaders we must achieve and
    deliver the right readiness at the right cost.
        The Integrated Readiness Capability Assessment (IRCA) was developed
    for the fiscal year 2005 budget to more carefully examine our readiness
    processes. Starting with our new FRP operating construct, we took a
    hard look at everything that we needed to have on hand and what we
    needed to do to deliver the required combat readiness for the Nation's
    needs.

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        The IRCA assessment helped us understand the collective
    contributions of all the components of readiness, accurately define the
    requirements, align the proper funding, and provide a balanced
    investment to the right accounts. It improved our visibility into the
    true requirements and it gave us a methodology to assess and understand
    both acceptable and unacceptable risks to our current readiness
    investments.
        The end result is this: we have carefully defined the readiness
    requirement. We have identified areas where we can streamline or cease
    activities that do not add to readiness. We have requested the funds
    our commanders need to create the right readiness for fiscal year 2005.
    I ask for your support of this year's current readiness request as
    we've redefined these processes and already taken acceptable risks. We
    will deliver the right readiness at the right cost to the Nation.
        These improvements to our operational availability of forces and
    the associated readiness elements will not be made on the backs of our
    people.
        We have a smart, talented cadre of professionals who have chosen a
    lifestyle of service. Our ability to challenge them with meaningful,
    satisfying work that lets them make a difference is part of our
    covenant with them as leaders.
        A new operating concept like the FRP could not be made if we still
    had the kind of manpower-intensive mindset to problem solving we had
    even 5 years ago. But today, thanks to your sustained investment in S&T
    among others, we have already realized some of the advancements in
    information technology, simulators, human system integration,
    enterprise resource planning, Web-enabled technical assistance and ship
    and aircraft maintenance practices that can reduce the amount of labor
    intensive functions, the training, and the technical work required to
    ensure our readiness.
        These advances speak to our larger vision for our Sea Power 21 Navy
    and its Sea Warrior initiative. Our people are today's capital assets.
    Without them, all the advanced weaponry in the world would sit dormant.
    But at the same time, it is the effects they deliver that are the true
    measure of their contribution to readiness and capability.
        We have long had a force stove-piped into active and Reserves,
    uniformed and civilian, sea and shore, and enlisted and officer
    components, all with work driven largely by the limits of industrial
    age military capabilities, personnel practices, technology, and the
    organizational models of the day.
        In today's era, when we have whole corporations bought or sold just
    to capture the intellectual capital of an organization, we recognize
    that our human resource strategy must capture the talents and efforts
    of our capital as well. Our vision for the future is a more truly
    integrated workforce wholly committed to mission accomplishment. This
    must include a total force approach that can functionally assess
    missions, manpower, technology, and training and produce an enterprise-
    wide resource strategy.
        The principles of this strategy are clear. We will capture the work
    that contributes to mission accomplishment. We will define enterprise-
    wide standards. We will leverage technology to both enhance and
    capitalize on the growth and development of our people. We will
    streamline organizational layers. We will instill competition. We will
    incentivize the talents and behaviors needed to accomplish the mission.
        There is still much to study and discuss as we develop our total
    force approach in the months and years ahead, but we can already see
    that the application of these principles will help us more accurately
    define our manpower requirement and lead us to a smaller workforce in
    the future.
        The benefits are enormous. Our people will be powerfully motivated
    and better educated and more experienced in the coming years. They will
    be properly equipped to maintain, operate and manage the higher
    technology equipments that are our future. Our combat capabilities will
    continue to grow.
        We must be committed to building a Navy that maximizes the
    capability of its people while minimizing the total number in the
    manpower account. Manpower is never free; in fact, manpower we do not
    truly need limits both the true potential of our people and the
    investments needed to transform our combat capability for the future.
        Our developing human resource strategy will likely require changes
    in the way we recruit, assess, train and manage the workforce. Sea
    Warrior of course, is crucial here. Last year's authorization of the
    National Security Personnel System (NSPS) is very important to such an
    effort as well. The NSPS Act authorized a more flexible civilian
    personnel management system that allows the Department of Defense (DOD)
    to be a more competitive and progressive employer at a time when our
    national security demands a highly responsive system of civilian
    personnel management. The legislation also ensures that merit systems
    principles govern changes in personnel management, whistleblowers are
    protected, discrimination and nepotism remain illegal, and veterans'
    preference is protected. This will facilitate the kind of competition
    and performance we need for the future. The Navy has volunteered to be
    in the first wave of conversions to NSPS in 2004.
        Most importantly, I believe we will also need these kinds of
    flexible authorities and incentive tools to shape the career paths and
    our skills mix in a way that lets us compete for the right talent in
    uniform, not just within the Navy, but with all the Nation's employers
    as well.
        In the months ahead, I will continue to discuss with you our
    developing human resource strategy and the kinds of authorities we'll
    need to deliver on it.
        We are beginning to realize the powerful warfighting capabilities
    of Sea Power 21. Our culture of readiness and our commitment to
    developing a 21st century workforce will help us employ those
    transformational capabilities to achieve unprecedented maritime power.
                    iii. our fiscal year 2005 budget request
        This past year our Navy's budget request continued our effort to
    sustain our current readiness gains, deepen the growth and development
    of our people and invest in our transformational Sea Power 21 vision
    while harvesting the efficiencies needed to fund and support these
    three critical priorities.
        This year we intend to:

             Deliver the right readiness at the right cost to
            support the war on terror and the Nation's warfighting needs,
             Shape the 21st century workforce and deepen the growth
            and development of our people, and
             Accelerate our investment in Sea Power 21 to
            recapitalize and transform our force and improve its ability to
            operate as an effective component of our joint warfighting
            team.

        At the same time, we will continue to pursue the Sea Enterprise
    improvements that make us a more effective Navy in both fiscal year
    2005 and beyond. Our Navy budget request for fiscal year 2005 and the
    future supports this intent and includes:

         Nine new construction ships in fiscal year 2005, including
    construction of the first transformational destroyer (DD(X)) and the
    LCS, the acceleration of a San Antonio Class Amphibious Transport Dock
    Class ship from fiscal year 2006 to fiscal year 2005, and one SSBN
    conversion and refueling. Our request this year includes the following
    ships:

             Three Arleigh Burke Class Guided Missile Destroyers
            (DDG)
             One Virginia class submarine (SSN)
             One San Antonio Class Amphibious Transport Dock (LPD)
             Two Lewis and Clark Class Dry Cargo and Ammunition
            ships (T-AKE)
             One 21st century Destroyer (DD(X))
             One LCS, and
             One SSBN conversion/refueling

        The investment plan across the Future Year's Defense Plan (FYDP)
    also includes three Maritime Prepositioned Force (Future) (MPF (F))
    ships and advanced procurement for an MPF (F) aviation variant. While
    our build rate dips to six ships in fiscal year 2006, this is a
    reflection of a shift in focus to the next generation surface
    combatants and sea basing capabilities. We have also assessed the risks
    and divested several assets that have high operating costs and limited
    technological growth capacity for our transformational future; this
    includes decommissioning two coastal mine hunter ships, and the
    accelerated decommissioning of the remaining Spruance-class destroyers,
    Sacramento Class Fast Combat Store Ships and the first five
    Ticonderoga-class guided missile cruisers in the FYDP.

         Procurement of 104 new aircraft in fiscal year 2005,
    including the F/A-18 E/F Super Hornet, the MH-60 R/S Seahawk and
    Knighthawk Multi-mission Combat Helicopter, the T-45 Goshawk training
    aircraft, and the Marine Corps MV-22 Osprey among others. We continue
    to maximize the return on procurement dollars through the use of multi-
    year procurement (MYP) contracts for established aircraft programs like
    the Super Hornet and we have increased our research and development
    investment this year in the Joint Strike Fighter (JSF), the EA-18G
    Airborne Electronic Attack (AEA) aircraft and the broad area anti-
    submarine, anti-surface, maritime and littoral intelligence,
    surveillance, and reconnaissance (ISR) capable Multi-mission Maritime
    Aircraft (MMA).
         Investment in transformational unmanned underwater
    vehicles (UUVs) like the Long-Term Mine Reconnaissance System, and
    unmanned aerial vehicles (UAVs) such as the Broad Area Maritime
    Surveillance UAV and the Joint-Unmanned Combat Air System. The budget
    also requests funding for experimental hull forms like the X-Craft, and
    other advanced technologies including the Joint Aerial Common Sensor
    (JACS).
         A 3.5 percent basic pay raise, and a reduction in average
    out-of-pocket housing costs from 3.5 percent to 0, allowing sailors and
    their families more of an opportunity to own their own homes and have
    more of a stake in their communities;
         Investment in housing and public-private ventures that
    will help eliminate inadequate barracks and family housing by fiscal
    year 2007 and enable us to house shipboard sailors ashore when their
    vessel is in homeport by fiscal year 2008;
         Readiness investment that supports the FRP, including
    sustained funding for ship and aircraft operations, aviation depot
    maintenance, and precision-guided munitions. This includes improvements
    in ship maintenance and training scheduling to maximize surge
    capabilities.
    A. Delivering the Right Readiness at the Right Cost
        To me, the ``right readiness'' is the return on your investment in
    the Navy. Readiness is the catalyst that brings combat power to bear
    whenever it is needed. Achieving readiness at any cost however is not
    good for the Nation. This year's request accurately defines our
    readiness needs, assesses the risks to our investment and--as
    requested--will deliver the resources necessary for leaders in the Navy
    to create the required readiness.

         Ship Operations and Flying Hours requests funds for ship
    operations operational tempo (OPTEMPO) of 51.0 days per quarter for our
    deployed forces and 24 days per quarter for our non-deployed forces. We
    have properly funded the flying hour account to support the appropriate
    levels of readiness and longer employability requirements of the FRP.
    This level of steaming and flying hours will enable our ships and air
    wings to achieve the required readiness over the longer periods defined
    by the FRP, and as a result, it will improve our ability to surge in
    crisis and sustain readiness during deployment.
         Ship and Aviation Maintenance. We have made significant
    improvements these last few years by reducing major ship depot
    maintenance backlogs and aircraft depot-level repair back orders;
    improving aircraft engine spares; adding ship depot availabilities;
    ramping up ordnance and spare parts production; maintaining steady
    ``mission capable'' rates in deployed aircraft; fully funding aviation
    initial outfitting; and investing in reliability improvements.
        Our fiscal year 2005 request continues to improve the availability
    of non-deployed aircraft and meets our 100 percent deployed airframe
    goals. Our ship maintenance request continues to ``buy-down'' the
    annual deferred maintenance backlog and sustains our overall ship
    maintenance requirement. We are making great strides in improving the
    visibility and cost effectiveness of our ship depot maintenance
    program, reducing the number of changes in work package planning and
    using our continuous maintenance practices when changes must be made.
         Shore Installations. Our Facilities Sustainment,
    Restoration, and Modernization (SRM) program remains focused on
    improving readiness and quality of service for our sailors. While our
    fiscal year 2005 Military Construction and Sustainment program reflects
    difficult but necessary trade-offs between shore infrastructure and
    fleet recapitalization, the majority of the SRM trends are very good.
    Facilities sustainment has increased in fiscal year 2005. Our budget
    request keeps us on a course to achieve the DOD goal of a 67-year
    recapitalization rate by fiscal year 2008, achieve Navy goals to
    eliminate inadequate family and bachelor housing by fiscal year 2007
    and provides Homeport Ashore Bachelor Housing by fiscal year 2008. We
    are exploring innovative solutions to provide safe, efficient
    installations for our service members, including design-build
    improvements, and base realignment and closure (BRAC) land sales via
    the General Services Administration (GSA) Internet. Additionally, with
    the establishment of Navy Installations Command, we have improved our
    capability to manage our dispersed facility operations, conserve
    valuable resources, establish enterprise-wide standards and continue to
    improve our facility infrastructure.
         Precision-guided munitions receive continued investment in
    our fiscal year 2005 request with emphasis on increasing the Joint
    Stand-Off Weapon (JSOW) baseline variant, Joint Direct Attack Munition
    (JDAM), Tactical Tomahawk (TACTOM), and Laser-Guided Bomb (LGB)
    inventory levels, while the JSOW penetrator variant enters full-rate
    production. We have also entered into a common missile program with the
    U.S. Army to replace the aging inventory of TOW, Maverick, and Hellfire
    missiles. Joint partnerships with the Air Force and Army in several of
    our munitions programs continue to help us optimize both our
    inventories and precious research and development investments and will
    remain a focus for us in the future.
         Training Readiness. We continue to make significant
    strides in this critical area. In fiscal year 2004, Congress supported
    two important programs to advance our training readiness. First, you
    endorsed the Training Resource Strategy (TRS), to provide more complex
    threat scenarios and to improve the overall realism and value of our
    training. Additionally, you funded the Tactical Training Theater
    Assessment and Planning Program to provide for a comprehensive training
    range sustainment plan. Our fiscal year 2005 budget continues this
    work. We are working to make the Joint National Training Capability a
    reality. We have established a single office to direct policy and
    management oversight for all Navy ranges as well as serve as the
    resource sponsor for all training ranges, target development and
    procurement, and the Navy portion of the Major Range Test Facility Base
    (MRTFB).
         Environmental Readiness. In the last 2 years, Congress has
    provided significant legislative relief from encroachment and
    environmental requirements by amending the Endangered Species Act, the
    Migratory Bird Treaty Act, and the Marine Mammal Protection Act. These
    amendments help to balance environmental stewardships and realistic
    military training. We will continue to focus the use of our ranges on
    military training, and remain committed to our environmental
    obligations through integrated natural resource management plans. We
    will make every effort to protect marine mammals while ensuring our
    sailors are properly trained and our transformational systems are
    properly tested. We look forward to demonstrating our ongoing
    commitment to environmental stewardship.
    B. Shaping the 21st Century Workforce
        At the heart of everything good in our Navy today is this: We are
    winning the battle for people. Higher quality recruits, historic
    retention rates, innovative incentive pay pilots, reduced attrition,
    competitive reenlistments and detailing, and outstanding leadership in
    the ranks has made this the highest quality workforce the Navy has ever
    seen.
        In 2003 specifically, we exceeded all of our aggregate retention
    goals for the third straight year; our recruiters reached their quotas
    for the 28th consecutive month; we reduced attrition another 10 percent
    from fiscal year 2002 levels; and, through decommissioning older,
    manpower-intensive platforms, improving training and employment
    processes, and more efficient infrastructure organization, we have
    reduced gaps at sea to less than 1,000, down from 18,000 gaps just 6
    years ago.

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        These accomplishments will help us develop the 21st century
    workforce we will need for our Sea Power 21 Navy. As our Navy becomes
    more high tech, so must our workforce. Our people will be a more
    educated and experienced group of professionals in the coming years,
    and we must properly employ their talents. We will spend whatever it
    takes to equip and enable these outstanding Americans, but we do not
    want to spend one extra penny for manpower we do not need.
        As part of that effort, we continue to pursue the kind of new
    technologies and competitive personnel policies that will streamline
    both combat and non-combat personnel positions, improve the two-way
    integration of active and Reserve missions, and reduce the Navy's total
    manpower structure. To that end, we are proposing a fiscal year 2005
    Navy end strength reduction of 7,900 personnel.

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        We will use existing authorities and our Perform To Serve (PTS)
    program to preserve the specialties, skill sets and expertise needed to
    continue the proper balancing of the force.
        We intend to build on the growth and development momentum of the
    last 3 recordbreaking years. We are fully committed to ensuring every
    sailor has the opportunity and resources to successfully compete. Our
    goal remains attracting, developing, and retaining the most highly
    skilled and educated workforce of warriors we have ever had, to lead
    the 21st century Navy.
        As I testified last year, Sea Warrior is designed to enhance the
    assessment, assignment, training, and education of our sailors.

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        Our fiscal year 2005 budget request includes the following tools we
    need to enhance mission accomplishment and professional growth:

         Innovative personnel employment practices are being
    implemented throughout the fleet. Optimal manning experiments in U.S.S.
    Boxer (LHD-4), U.S.S. Milius (DDG 69) and U.S.S. Mobile Bay (CG 53)
    produced revolutionary shipboard watch standing practices, while
    reducing overall manning requirements and allowing sailors to focus on
    their core responsibilities. The fleet is implementing best practices
    from these experiments to change Ship Manning Documents in their
    respective classes. Optimal manning means optimal employment for our
    sailors.
        We have our fourth crew aboard U.S.S. Fletcher (DD 992) and our
    third crew aboard U.S.S. Higgins (DDG 76) in our ongoing Sea Swap
    initiative. This has saved millions of dollars in transit fuel costs
    and increased our forward presence without lengthening deployment times
    for our sailors. Fletcher and Higgins will return to San Diego this
    year after a period of forward deployed operations of 22 months and 17
    months respectively. We will continue to assess their condition and
    deep maintenance needs to develop and apply lessons learned to future
    Sea Swap initiatives.
         Selective Reenlistment Bonus (SRB). Targeted bonuses such
    as SRB are critical to our ability to compete for our highly trained
    and talented workforce both within the Navy and with employers across
    the Nation as well. Proper funding, adequate room for growth, and the
    flexible authorities needed to target the right skills against the
    right market forces are important to the shape of the workforce. This
    program specifically targets retention bonuses against the most
    critical skills we need for our future. We ask for your continued
    support and full funding of this program.
         Perform to Serve. Last year, we introduced PTS to align
    our Navy personnel inventory and skill sets through a centrally managed
    reenlistment program and instill competition in the retention process.
    The pilot program has proven so successful in steering sailors in
    overmanned ratings into skill areas where they are most needed that the
    program has been expanded. More than 2,400 sailors have been steered to
    undermanned ratings and approved for reenlistment since the program
    began last February and we will continue this effort in 2005.
         Assignment Incentive Pay (AIP) is a financial incentive
    designed to attract qualified sailors to a select group of difficult to
    fill duty stations. AIP allows sailors to bid for additional monetary
    compensation in return for service in these locations. An integral part
    of our Sea Warrior effort, AIP will enhance combat readiness by
    permitting market forces to efficiently distribute sailors where they
    are most needed. Since the pilot program began last June, more than
    1,100 AIP bids have been processed resulting in 238 sailors receiving
    bonuses for duty in these demanding billets. We ask for continued
    support of this initiative.
         Professional Military Education (PME). We are taking a
    more comprehensive approach to the education of our people than we have
    done in the past. We are in the process of developing a PME continuum
    that integrates general education, traditional Navy-specific PME, and
    Joint PME (JPME) curricula. This will allow us to develop a program
    that fully incorporates all aspects of our professional and personal
    growth and development training needs. Improvements so far include
    establishing networks with civilian educational institutions,
    developing new degree programs, and establishing partnerships with
    other services' institutions. We are also expanding opportunity through
    distance learning and the Internet. We are committed to broadening the
    professional and intellectual horizons of both our officers and our
    enlisted men and women to prepare them to operate tomorrow's fleet and
    assume key naval and joint leadership roles.
         The Human Performance Center (HPC) has been established to
    apply Human Performance and Human System Integration principles in the
    research, development and acquisition processes. In short, the HPS will
    help us understand the science of learning. They will ensure training
    is driven by fleet requirements and they will focus requirements on the
    performance needed to carry out our missions. This will eliminate
    potential performance and training deficiencies, save money and help us
    improve our readiness.
         The Integrated Learning Environment (ILE) is the heart of
    our revolution in training. ILE is a family of systems that, when
    linked, will provide our sailors with the ability to develop their own
    learning plans, diagnose their strengths and weaknesses, and tailor
    their education to support both personal and professional growth. They
    will manage their career requirements, training and education records.
    It will match content to career requirements so training is delivered
    at the right time. Most importantly, these services will be provided
    anytime, anywhere via the Internet and the Navy-Marine Corps Intranet
    (NMCI).
        We are taking advantage of every opportunity to accelerate the
    tools we need to develop our 21st century workforce. The improvements
    and pilots that Congress has supported--including bonuses, pay table
    adjustments, retirement reforms, better medical benefits, and our Sea
    Warrior initiatives--are having the desired impact.
        Your support of our fiscal year 2005 request for a 3.5 percent
    basic pay raise, for our efforts to transform our manpower structure in
    some fundamental ways, and for a reduction in average out-of-pocket
    housing costs from 3.5 percent to 0 will have a direct effect on our
    ability to properly size and shape the 21st century workforce that is
    our future.
    C. Accelerate Our Investment in Sea Power 21
        As I testified last year, Sea Power 21 defines the capabilities and
    processes that the 21st century Navy will deliver. We now have an
    opportunity to accelerate the advantages that our vision for a joint,
    netted, and sea-based force provides this Nation, thanks to the
    tremendous investments that you have made in our battle for people, in
    the quality of service for each of our sailors, and in readiness.
        This year, we will pursue distributed and networked solutions that
    could revolutionize our capability. We will focus on the power of sea
    basing and our complementary capability and alignment with our number
    one joint partner, the U.S. Marine Corps. We will sustain a robust
    science and technology program, and we will exploit investments made in
    joint research and development (R&D) wherever possible.
        For example, we are urgently pursuing technical advances to support
    our sailors, soldiers, airmen, and marines in Iraq. The Naval Sea
    Systems Command and the Office of Naval Research are working closely
    with all Services, government agencies, industry, and academic and
    government laboratories to identify, test, and deploy promising
    technologies that can counter improvised explosive devices (IEDs),
    snipers, suicide bombers, and other force protection threats. We are
    also pursuing other quick-reaction technology initiatives such as
    persistent wide-area surveillance using small UAVs, blue force tracking
    technology, body armor, and extremity protection. We are committed to
    ensuring that the joint force on the ground is as equipped as they
    possibly can be to accomplish their mission.
        Our highest priority programs within each of the core capability
    sets that define our Sea Power 21 vision.
        Sea basing is the projection of operational independence. Our
    future investments will exploit the largest maneuver areas on the face
    of the Earth: the sea. Sea basing serves as the foundation from which
    offensive and defensive fires are projected--making Sea Strike and Sea
    Shield a reality. Sea basing capabilities include, Joint Command and
    Control, Afloat Power Projection and Integrated Joint Logistics.

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        Our intent is to maximize our sea basing capability and minimize as
    much as possible our reliance on shore-based support nodes. To do this,
    we will make doctrinal, organizational and operational changes mandated
    by this concept and by the underlying technology that makes it
    possible. We have an opportunity here, along with the U.S. Marine Corps
    and the U.S. Army, to reexamine some of the fundamentals of not only
    how we move and stage ground forces, but how we fight ashore as well.
    Our highest priority sea basing investments include:

         Surface Combatant Family of Ships. As I have already
    testified, the power of joint forces in OIF was in the synergy of
    individual Service strengths. The same concept holds true within the
    Navy itself. We seek the synergy of networks, sensors, weapons, and
    platforms that will make the joint force greater in combat power than
    the sum of the individual parts. Development of the next generation of
    surface combatants as ``sea frames''--analogous to ``air frames''--that
    are part of a modular system is just such an endeavor.
        The surface combatant family of ships allows us to dramatically
    expand the growth potential of our surface combatants with less
    technical and fiscal risk. To bring these concepts to life and to take
    them--and the fight--to the enemy, we have decided upon three entirely
    new ship classes. The first to premier will be the LCS in 2007. The
    DD(X) will follow in about 2011. Just a few years after the first
    DD(X), the keel will be laid on the first CG(X), the next class of
    cruiser designed from the keel up for theater air and ballistic missile
    defense.
        Our R&D efforts and experimentation with high speed and theater
    support vessels like Swift, and the X-Craft later this year, are
    helping us reduce our technical risk and apply important lessons in
    hull design and mission modularity to the development of the surface
    combatant family of ships. DD(X)is the heart of the family and will
    spiral promising technologies to both CG(X) and LCS in the future. I
    will discuss each one of these ships in more detail below.

         CVN 21 is the centerpiece of the Navy CSG of the future.
    It will bring transformational capabilities to the fleet, including a
    new electrical generation and distribution system, the electromagnetic
    aircraft launching system (EMALS), a new/enlarged flight deck, weapons
    and material handling improvements, and a crew reduction of at least
    800 personnel. It will be able to generate higher daily and sustained
    sortie rates than our Nimitz-class aircraft carriers. Our fiscal year
    2005 request of $979 million in R&D and procurement funding continues
    the development of CVN 21 and several critical technologies in the lead
    ship, including the EMALS prototype and testing already ongoing in
    Lakehurst, New Jersey. Construction of the CVN 21 remains on track to
    start in fiscal year 2007.
         CVN 70 RCOH. The fiscal year 2005 budget provides advanced
    procurement funds for the U.S.S. Carl Vinson (CVN 70) RCOH, now
    scheduled to begin in fiscal year 2006. CVN 70 has sufficient reactor
    fuel for one additional deployment. This action makes the best possible
    use of Carl Vinson's remaining fuel capacity and improves shipyard work
    loading.
         MPF(F). These future Maritime Prepositioning Ships will
    serve a broader operational function than current prepositioned ships,
    creating greatly expanded operational flexibility and effectiveness. We
    envision a force that will enhance the responsiveness of the joint team
    by the at-sea assembly of a Marine Expeditionary Brigade that arrives
    by high-speed airlift or sealift from the United States or forward
    operating locations or bases. These ships will off-load forces, weapons
    and supplies selectively while remaining far over the horizon, and they
    will reconstitute ground maneuver forces aboard ship after completing
    assaults deep inland. They will sustain in-theater logistics,
    communications and medical capabilities for the joint force for
    extended periods as well. Our fiscal year 2005 request accelerates the
    lead MPF(F) from fiscal year 2008 to fiscal year 2007 to reflect our
    emphasis on Sea Basing capabilities.

        Sea Strike is the projection of precise and persistent offensive
    power. The core capabilities include Time Sensitive Strike; ISR; Ship
    to Objective Maneuver; and Electronic Warfare and Information
    Operations.

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        We are already investing in impressive programs that will provide
    the capabilities necessary to support Sea Strike; these include the
    following fiscal year 2005 priorities:
         DD(X). The technology engine for the fleet, DD(X) is the
    centerpiece of a surface combatant family of ships and will deliver a
    broad range of capabilities. This advanced multi-mission destroyer will
    bring revolutionary improvements to precise, time-critical strike and
    joint fires and our Expeditionary Strike Groups of the future.
        Transformational and leap ahead technologies include an electric
    drive and integrated power system; an advanced gun system (AGS) with
    the high rate of fire and precision to reach almost 8 times farther and
    command more than 110 times the area of our current five inch
    capability; the new Multi-Function Radar/Volume Search Radar suite;
    optimal manning through advanced system automation, stealth through
    reduced acoustic, magnetic, infrared, and radar cross-section
    signature; and enhanced survivability through automated damage control
    and fire protection systems. DD(X) is an enabler both technically and
    operationally. This seaframe will also reduce our seagoing manpower
    requirements and will lower total ownership costs.
        This program will provide a baseline for spiral development of
    technology and engineering to support a range of future seaframes such
    as CG(X). It will also enable the transformation of our operations
    ashore. Imagine an Army or Marine rifleman on the ground and Navy petty
    officer at sea looking at the same real-time picture of enemy troops
    encamped at a municipal airport. With the push of a button, the
    rifleman sends targeting coordinates to the petty officer in a DD(X)
    more than 50 miles offshore. Within a few minutes, rounds from the AGS
    start falling on the airport with incredible accuracy. That kind of on-
    demand, persistent time-critical strike will revolutionize our joint
    fire support and ground maneuver concepts of operation and it will free
    our strike fighter aircraft for more difficult targets at much greater
    ranges.
        DD(X)'s all-electric drive, called the Integrated Power System
    (IPS), will not only drive the ship through the water, but will also
    generate the kind of power capacity that will enable eventual
    replacement of the AGS. When combined with the physical capacity and
    volume of the hull form, DD(X) could lead us to revolutionary
    technologies from the naval research enterprise like the
    electromagnetic rail gun and directed energy weapons. The fact that
    rail guns do not require any explosives will free up magazine space for
    other mission areas. This capability is projected to be a reality in
    the 2015 to 2018 timeframe. DD(X) will be in service for decades after
    that; having the kind of growth potential to install those kinds of
    technologies dramatically lowers our future development costs.
        The funding profile for DD(X) supports the 14,000-ton design and
    the S-Band Volume Search Radar (VSR). Lead ship detail design and
    construction are planned to start in fiscal year 2005.

         JSF. The JSF will enhance our Navy precision with
    unprecedented stealth and range as part of the family of tri-Service,
    next-generation strike aircraft. It will maximize commonality and
    technological superiority while minimizing life cycle cost. The JSF has
    just completed the second year of a 10-11 year development program, and
    is experiencing a variety of typical challenges that affect System
    Development and Demonstration (SDD) program schedule and cost.
    Additional design work is required to address technical issues,
    primarily weight projections. The budget therefore realigns $5 billion
    from procurement appropriations in fiscal year 2005 through fiscal year
    2009, and Low Rate Initial Production (LRIP) was deferred 1 year to
    fiscal year 2007. The JSF remains vital to our future. It will give us
    the range, persistence and survivability needed to keep our strike
    fighters viable for years to come.
         SSGN. Funding is included in fiscal year 2005 to continue
    the SSGN conversion program. Our future SSGN capability will provide
    covert conventional strike platforms capable of carrying 150 Tomahawk
    missiles. The SSGN will also have the capacity and capability to
    support SOF for an extended period, providing clandestine insertion and
    retrieval by lockout chamber, dry deck shelters or the Advanced Seal
    Delivery System (ASDS), and they will be arrayed with a variety of
    unmanned vehicles to enhance the Joint Forces Commander's knowledge of
    the battlespace. The inherently large capacity of these hulls will
    enable us to leverage future payloads and sensors for years to come. We
    still expect our first SSGN to be operational in 2007.
         EA-18G. Last year, you initiated funding at our request to
    replace the aging EA-6B Prowler with the EA-18G AEA aircraft. Increased
    EA-6B usage in 2003 has resulted in wing center section or outer wing
    panel fatigue for some 43 EA-6B aircraft, making your support last year
    critical to our ability to dramatically accelerate the recapitalization
    of the Nation's only joint electronic attack capability. Using the
    demonstrated growth capacity of the F/A-18E/F, the EA-18G will quickly
    recapitalize our electronic attack capability at lower procurement
    cost, with significant savings in operating and support costs; all
    while providing the growth potential for future electronic warfare
    system improvements. It will use the Improved Capability Three (ICAP
    III) receiver suite and provide selective reactive jamming capability
    to the warfighter. This will both improve the lethality of the air wing
    and enhance the commonality of aircraft on the carrier deck. We begin
    purchasing airframes in fiscal year 2006 and will achieve initial
    operating capability in 2009.
        Sea Shield is the projection of layered, global defensive power.

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        Sea Shield will enhance deterrence and warfighting power by way of
    real-time integration with joint and coalition forces, high speed
    littoral attack platforms setting and exploiting widely distributed
    sensors, and the direct projection of defensive power in the littoral
    and deep inland. Sea Shield capabilities include: homeland defense, sea
    and littoral control, and theater air and missile defense. Our highest
    priority Sea Shield programs this year include:
         Mine Warfare Programs. We intend to field a set of
    unmanned, modular mine countermeasure (MCM) systems employable from a
    variety of host platforms or shore sites to minimize our risk from
    mines and sustain our national economic and military access to every
    corner of the globe. Our future MCM capability will be faster, more
    precise and organic to both Expeditionary and Carrier Strike Groups and
    will ultimately remove both the man and our mammals from the minefield.
    Within the FYDP, we expect to reduce the time that it takes to render
    sea mining ineffective by at least half of the time that it takes us
    today.
        Our fiscal year 2005 budget request includes funding to realize
    organic mine warfare capabilities in one Strike Group this year, while
    maintaining the funding necessary for a potent and dedicated MCM force.
    We have also requested an increase of $167 million across the FYDP for
    mine warfare programs, to include unmanned vehicles such as the Long-
    Term Mine Reconnaissance System (LMRS) to provide a clandestine mine
    reconnaissance capability from our Los Angeles-class submarines, and
    the Remote Minehunting System on Arleigh Burke-class destroyers (DDGs
    91-96). Both of these programs are scheduled to reach initial operating
    capability (IOC) milestones this year. Future introduction of the LCS
    with mine warfare mission modules will improve the ability of Strike
    Groups to neutralize mine threats in parallel with--not in sequence
    before--other operations.
         Littoral Combat Ship. The role of LCS is to provide access
    to joint forces in the littorals; a capability gap we identified as a
    result of the 2001 Quadrennial Defense Review. During the past year and
    a half, considerable campaign analysis and fleet battle experiments
    have demonstrated that naval forces need better ways to fight mines;
    small, fast, highly armed boats; and quiet diesel and advanced air-
    independent propulsion submarines operating in shallow waters. The
    performance of U.S. Navy Patrol Craft and the experimental HSV-X1 Joint
    Venture in the Iraqi littoral was critical to the early detection and
    destruction of the Iraqi mine threat. The same kind of capability needs
    to be delivered in a fast, maneuverable, shallow-draft platform that
    has the survivability to operate independently. LCS will have these
    characteristics, along with self-defense, navigation, and command-and-
    control systems.
        LCS will be built from the keel up to be a part of a netted and
    distributed force, and will be the first ship designed with FORCEnet as
    a requirement. The main battery of LCS will be its off-board systems:
    manned helicopters and unmanned aerial, surface and underwater
    vehicles. It is the off-board vehicles--with both sensors and weapons--
    that will enter the highest threat areas. Its modular design, built to
    open-systems architecture standards, provides flexibility and a means
    to rapidly reconfigure mission modules and payloads. As technology
    matures, the Navy will not have to buy a new LCS platform, but will
    upgrade the mission modules or the unmanned systems.
        LCS also will have an advanced hull design and be significantly
    different from any warship that has been built for the U.S. Navy.
    Detail design and construction of the first LCS Flight 0 ship is
    planned in fiscal year 2005. The LCS requirements process is tailored
    to support the rapid delivery of two flights (Flight 0 and 1) of ships,
    using an evolutionary, ``spiral'' acquisition approach. The spiral
    development process allows time-phased capability improvement for ship
    and mission systems. This incremental development and delivery strategy
    supports the ship's accelerated acquisition schedule, diverse threat
    and capability requirements, and dynamic levels of technology push/
    pull. The ship's modular, open design will also enable lifecycle
    adaptability and affordability. Four LCSs have been added since last
    year's budget plan was submitted.
         Missile Defense. Our Navy is poised to contribute
    significantly in fielding initial sea based missile defense
    capabilities to meet the near-term ballistic missile threat to our
    homeland, our deployed forces, and our friends and allies. We are
    working closely under the authority of the Missile Defense Agency (MDA)
    to deliver this much-needed capability to the Nation's combatant
    commanders. Our sea-based missile defense programs experienced
    tremendous success on the test range this year, scoring two of three
    intercepts. Continued development and testing will support initial
    defensive operations beginning in the fall of 2004, with select Arleigh
    Burke-class destroyers providing long range surveillance and tracking
    to the Nation's capability late this year.
         MMA--Broad Area Maritime Surveillance (BAMS). We
    significantly increased this year's R&D funding for the MMA to
    recapitalize our 1950s-era Lockheed ``Electra'' based P-3 force. Our
    acquisition plan was further refined this past year with the
    integration of the BAMS-UAV program into the overarching Maritime
    Patrol and Armed Reconnaissance requirement. This lethal combination of
    manned and unmanned reconnaissance aircraft will recapitalize our
    maritime patrol anti-submarine warfare, anti-surface warfare and armed
    ISR capability. We also developed a robust sustainment plan for the
    current P-3 fleet that includes special structural inspections (SSI)
    and kits that extend P-3 service lives by a minimum of 5,000 hours.
    This SSI program will replace, correct or modify our current P-3 force
    to ensure that they do not prematurely reach the end of their fatigue
    life before we achieve IOC of the MMA in 2013.
         Virginia-class submarine (SSN-774). The first ship of this
    class was christened this year and will commission in 2004. This class
    will replace Los Angeles-class (SSN-688) attack submarines and will
    incorporate new capabilities, including unmanned vehicles, and the
    ability to support SOF. It will be an integral part of the joint,
    networked, dispersed 21st century fleet. Our fiscal year 2004 budget
    funded the first of five submarines under the MYP contract authorized
    by Congress last year. The second submarine of the MYP contract is
    funded in fiscal year 2005. Approximately $240 million in economic
    order quantity advance procurement is funded in fiscal year 2005 in
    support of this contract.
         CG Modernization. Funding for the Ticonderoga-class
    cruiser modernization continues in fiscal year 2005. The Cruiser
    Modernization Program is a mid-life upgrade for our existing Aegis
    cruisers that will ensure modern, relevant combat capability well into
    this century and against evolving threats. These warships will provide
    enhanced area air defense to the Joint Forces Commander. These
    modifications include installations of the Cooperative Engagement
    Capability, which enhances and leverages the air defense capability of
    these ships, and an antisubmarine warfare (ASW) improvement package.
    These converted cruisers could also be available for integration into
    ballistic missile defense missions when that capability matures. Our
    first cruiser modernization begins in fiscal year 2006.
        FORCEnet is the operational construct and architectural framework
    for naval warfare in the joint, information age. It will allow systems,
    functions, and missions to be aligned in a way that will transform our
    situational awareness, accelerate speed of decisions and allow naval
    forces to greatly distribute its combat power in a unified, joint
    battlespace. FORCEnet provides the world-class information and
    technology (IT) tools that we need to continue to be the world-class
    Navy.

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        Programs that will enable the future force to be more networked,
    highly adaptive, human-centric, integrated, and enhance speed of
    command include:
         Navy Marine Corps Intranet. NMCI is operational and
    providing commercial IT services for more than 300,000 Navy employees
    and two combatant commanders. This initiative, as part of our FORCEnet
    strategy, is providing a single, secure shore-based network and will
    link with our tactical networks to provide end-to-end collaboration
    within the Navy and across the joint community. fiscal year 2005
    funding of $1.6 billion provides for NMCI operations and, at the same
    time, continues transition of the remaining legacy IT networks to NMCI
    enterprise network services. This past year, with the help of the
    authorizing language you provided, the NMCI program finalized a full
    partnership agreement with the Defense Information Systems Agency
    (DISA) for operations and provisioning.
         Mobile User Objective System (MUOS). The new MUOS
    Satellite Communications (SATCOM) program will increase DOD narrowband
    ultra-high frequency (UHF) SATCOM capacity by roughly 1,300 percent
    over current capabilities. MUOS is a $6.4 billion joint interest
    program, and it supports a particularly important ``Comms-on-the-Move''
    capability for handheld terminals, aircraft, missiles, and UAVs in
    urban and heavily wooded terrain. We plan to reach the initial
    operational capability (IOC) milestone in 2009, with full operational
    capability in 2013.
         Joint Aerial Common Sensor (JACS). We have partnered with
    the Army in the JACS development program in our pursuit of a
    replacement for the aging EP-3 airborne information warfare and
    tactical signals intelligence (SIGINT) aircraft. JACS will provide
    multi-intelligence strike targeting data and Signals Intelligence
    capabilities, and will include a Synthetic Aperture Radar, Ground
    Moving Target Indicator, electro-optical and infrared sights, and
    measurements and signature capabilities. These will be coupled with
    automatic/manual data fusion. Our fiscal year 2005 request includes $25
    million for this program.
         Joint Tactical Radio System (JTRS). JTRS will be the
    wireless ``last tactical mile'' component of the Global Information
    Grid (GIG) and will transform Navy's tactical communications systems by
    incorporating Internet Protocol (IP) communications over multi-spectral
    radio frequency (RF) media. JTRS is a software programmable, multi-
    band, multi-mode family of net-workable radios, capable of simultaneous
    voice, data, video communications and mobile ad hoc networking. Our
    fiscal year 2005 request includes $56 million for JTRS.
         Deployable Joint Command Control System (DJC2). DJC2 is
    the priority command and control (C2) transformation initiative. DJC2
    will provide a standing, fully deployable, scaleable, and standardized
    C2 capability to the regional combatant commanders (RCC) and Joint
    Force Commanders. DJC2 responds to the need for joint, deployable C2
    capability, with first RCC delivery to Pacific Command (PACOM) in
    fiscal year 2005. DJC2 is an enabler for the Standing Joint Force
    Headquarters concept being developed by Joint Forces Command (JFCOM).
    The Navy is lead component for the acquisition program, and we ask your
    support for the $81 million we've requested in fiscal year 2005.
    D. Improving Effectiveness
        As I have testified, your Navy today is the most capable and most
    ready Navy in our history, thanks in large part to the support of
    Congress and of the American people. But, I believe that we can do
    better--that, in fact, we must do better--as stewards of the public
    trust in determining not just how much we should spend on programs, but
    how those defense dollars are spent. This is especially true today
    because of the strategic challenges posed by the ongoing global war on
    terrorism, because of our need to recapitalize aging, Cold War-era
    infrastructure and capability, and because of the burgeoning
    technological and operational changes that will dramatically alter the
    way we fight. Revolutionizing the way in which our defense dollars are
    spent presents opportunities to increase our effectiveness, both now
    and in the future.
        Sea Enterprise is focusing headquarters leadership on outputs and
    execution, and is creating ideas that will improve our productivity and
    reduce our overhead costs. Its key objectives are to:

             Leverage technology to improve performance and
            minimize manpower costs;
             Promote competition and reward innovation and
            efficiency;
             Challenge institutional encumbrances that impede
            creativity and boldness in innovation;
             Aggressively divest non-core, underperforming or
            unnecessary products, services and production capacity;
             Merge redundant efforts;
             Minimize acquisition and life-cycle costs;
             Maximize in-service capital equipment utilization; and
             Challenge every assumption, cost, and requirement.

        Department of the Navy senior leadership is actively engaged in
    tracking the execution of ongoing Sea Enterprise initiatives totaling
    approximately $40 billion, and identifying $12.4 billion in cost
    savings and requirements mitigation across the FYDP. We are committed
    to efficiency and productivity improvements that will generate the
    savings necessary to augment our investment stream and implement our
    Sea Power 21 vision--delivering the right force, with the right
    readiness, at the right cost. Specific highlights of these fiscal
    transformation initiatives include:

         Right Readiness. Along with the FRP, we have also
    initiated processes ashore that will generate a more effective force.
    As just one example, we have established a single shore installation
    management organization, Commander, Navy Installations (CNI), to
    globally manage all shore installations, promote ``best practices''
    development, and provide economies of scale, increased efficiency,
    standardization of polices, and improved budgeting and funding
    execution. This initiative is anticipated to save approximately $1.2
    billion across the FYDP.
         Right Cost. We have taken a hard look at our ``level of
    effort'' programs to maximize return on taxpayer investment. This
    year's effort generated $2 billion in future savings in programs not
    supported by specific performance metrics in force structure, readiness
    or cost benefit. In addition, we focused on streamlining our
    organizations and processes as a means to harvest efficiencies and
    control costs. Innovative programs like Shipmain and the Naval Aviation
    Readiness Integrated Improvement Program are aiding in developing and
    sharing best practices, streamlining maintenance planning and improving
    performance goals in shipyards, aviation depots, and intermediate
    maintenance activities. We also reorganized the Navy Supply Systems
    Command, including the establishment of the Naval Operational Logistics
    Support Center to consolidate transportation, ammunition and petroleum
    management. We will continue to look for additional opportunities in
    this area while leveraging the gains already made.
         Right Force. We believe transformation to our future force
    must include improving our buying power. To improve upon our force
    structure, we are divesting non-core, redundant, underperforming, and
    outdated products and services. We are using multi-year procurement
    contracts and focusing where possible on economic order quantity
    purchase practices to optimize our investments. An excellent example
    lies in the F/A-18E/F multi-year procurement contract that anticipates
    procurement of 210 aircraft while saving us in excess of $1.1 billion
    across the FYDP. We also recognize the need to transform our single
    greatest asymmetric advantage, our people. The upcoming year will focus
    on ensuring we not only have the right number, but the right mix of
    military, civilian, and contractor personnel to accomplish the mission
    at the lowest possible cost. You have given us a tremendous tool to
    enhance our flexibility in this area, the NSPS, and we plan to take
    full advantage of it.
        Building on prior efforts, I am dedicating a significant amount of
    personal time to conducting execution reviews with leadership at the
    major commands across the Navy because, as I see it, leadership
    engagement in execution is an essential step to achieving our Sea
    Enterprise objectives. These reviews have provided me the opportunity
    to focus on the intricate details of the organizations while ensuring
    commanders are aligned with the vision and direction in which we are
    steaming. We focus on ways to swiftly move from strategy to
    implementation, as well as innovative ways to reduce costs and return
    resources to the enterprise for reinvestment.
        In 2005, the Navy will continue to pursue product and process
    efficiencies and the opportunities to be more effective while improving
    our warfighting capability. Harvesting the savings for recapitalization
    is a vital part of that effort, and we will continue to balance the
    benefits of new productivity initiatives against operational risks. Our
    intent is to foster a culture of continuous process improvement, reduce
    overhead, and deliver the right force structure both now and in the
    future.
                                 iv. conclusion
        For us, winning the global war on terrorism remains our number one
    objective--and victory is the only acceptable outcome. To achieve this,
    we are accelerating the advantages we bring to the Nation.
        The FRP will improve upon the operational availability of fleet
    units, providing forward deployed forces for enhanced regional
    deterrence and contingency response, while at the same time, retaining
    the ability to rapidly surge in times of crisis.
        We are investing in enhanced warfighting capability for the joint
    force, using the extended reach of naval weapons and sensors to reach
    farther and more precisely with striking power, and deliver broader
    defensive protection for joint forces ashore and fully leverage our
    command of the sea.
        We are creating a personnel environment that attracts, retains, and
    relies upon creative, effective, and competitive people. We are
    investing in the tools, the information technology, and the training
    that delivers more meaningful job content to them because it is they
    who offer us our greatest advantage.
        The support of Congress is vital to our readiness today and to
    building the Navy of tomorrow--I thank you for your dedicated efforts
    and support.

        Chairman Warner. Thank you very much, Admiral. I felt it
    important to pose that question at this particular time because
    we are very proud in this Nation of civilian control of the
    military. Nevertheless, those in the ranks look up and they see
    you as Chief of Naval Operations (CNO) and they repose in you
    and the other chiefs a very special trust and confidence. That
    statement that you just made will resonate throughout the Armed
    Forces of the United States.
        Thank you.
        General Hagee.

      STATEMENT OF GEN. MICHAEL W. HAGEE, USMC, COMMANDANT OF THE
                              MARINE CORPS

        General Hagee. Thank you. Mr. Chairman, Senator Levin,
    distinguished members of the committee: It is my privilege to
    report to you that your marines, active and Reserve, are well
    trained, well equipped, highly motivated, and they are ready.
    As Senator Lieberman so beautifully articulated, their families
    are behind them.
        Your support, and that of the American people, is critical
    and deeply appreciated. Your sustained commitment to improving
    our Nation's Armed Forces to meet the challenges of today as
    well as those of the future is vital to our Nation's security.
        Mr. Chairman, in answer to your question, I was in sort of
    a unique position over the last couple of years, two positions
    actually. Before becoming Commandant of the Marine Corps, I was
    the Commanding General of the First Marine Expeditionary Force
    (MEF). That, of course, was the force that fought up on the
    right flank in Iraq. In that role I was very involved in the
    planning of that particular operation. I can tell you, sir,
    that based on the intelligence that I had received from
    throughout the Intelligence Community and the analysis of our
    own internal intelligence individuals, I was absolutely
    convinced that Saddam Hussein had chemical weapons, if not
    biological weapons, and that he would use them when we crossed
    the line of departure.
        We prepared those marines for that contingency. We went to
    great lengths to secure the Saratoga suits. We went to great
    lengths to ensure they all had protective masks and the
    appropriate number of filters. We had both chemical and
    biological detection devices, devices that we did not normally
    have in the Marine Corps, brought in for that contingency.
        I took over as Commandant of the Marine Corps on January 13
    of last year. The intelligence that I saw once I came back here
    to Washington convinced me that I was correct in my analysis.
    When we crossed the line of departure last March, I was still
    convinced that he was going to use chemical weapons on our
    marines and our soldiers. In that particular stance, I am happy
    that I was wrong on that.
        But looking back on the intelligence that we had at that
    particular time, there is nothing different that I would do,
    even having perfect vision looking back.
        Sir, the Marine Corps' first priority is and will continue
    to be warfighting readiness and excellence in support of our
    Nation. In the near term, the Marine Corps is focused on
    readiness to provide expeditionary forces that meet our
    Nation's demanding needs. For the long term, the Marine Corps
    and the Navy are committed to developing a sea basing
    capability that will provide a critical joint competency for
    assuring access and projecting power from the sea worldwide.
        During this past year, your marines, both active and
    Reserve, were engaged in operations in support of the global
    war on terrorism from Afghanistan to the Horn of Africa to
    Liberia. Highlighting the value of our expeditionary
    capability, in OIF we deployed a combat-ready sustainable force
    of almost 70,000 marines and sailors in less than 60 days.
        We are now preparing to deploy forces to relieve Army units
    in western Iraq in support of OIF 2. Beginning this month, we
    will deploy approximately 25,000 marines into Iraq. In our
    preparations we are working closely with Army forces in and
    outside concerning equipment, tactics, techniques, and
    procedures. We are also drawing on analysis of our experiences
    last year in southern Iraq, the tactics of the British, and our
    own extensive small wars experience.
        Before we deploy, we are conducting rigorous urban
    operations training and language and cultural education. We are
    paying particular attention to individual and vehicle
    protective equipment enhancements and procedures. We are also
    continuing to improve our warfighting capabilities by
    leveraging advancements in technology, developing innovative
    organizations, and improving our joint training. Currently the
    First Expeditionary Strike Group, which combines the
    capabilities of essentially a surface action group, submarine
    and maritime patrol aircraft, with those of an amphibious ready
    group and a Marine expeditionary unit, special operations
    capable, is returning from its deployment to the U.S. Central
    Command (CENTCOM) area of responsibility (AOR).
        We are combining our analysis of OEF and OIF with the
    lessons from this initial deployment in order to enhance our
    adaptability, flexibility, and lethality. In addition, naval
    tactical air (TACAIR) integration continues to be implemented
    and we are aggressively improving our interoperability with
    special operations forces.
        Our top ground and aviation programs are adequately funded.
    The introduction of new systems such as the MV-22 Osprey, the
    Expeditionary Fighting Vehicle, the JSF, the Lightweight 155
    Howitzer, the Four-Bladed Cobra and Huey Upgrade Helicopters,
    and the High Mobility Artillery Rocket System into our force
    structure will significantly increase our speed, flexibility,
    and our overall expeditionary and amphibious warfighting
    capabilities.
        In planning for the future uncertainties, the Secretary of
    the Navy, the CNO, and I are committed to developing a sea
    basing capability that will provide a critical joint competency
    for assuring access and projecting power that will greatly
    improve the Nation's security. Sea basing in the future will
    assure joint access by capitalizing on the dilemma created by
    the operational maneuver of forces from the sea. The
    replacement ships for the amphibious assault ships (LHA) class
    are an essential part of our concept of joint sea basing.
        Mr. Chairman, lastly I would like to emphasize the
    magnificent performance of your individual marines, the most
    agile and lethal weapon system we possess.
        On behalf of all marines, I thank this committee for your
    steadfast support and I look forward to your questions.
        [The prepared statement of General Hagee follows:]
               Prepared Statement by Gen. Michael W. Hagee, USMC
        Chairman Warner, Senator Levin, distinguished members of the
    committee; it is my honor to report to you on the state of readiness of
    your United States Marine Corps. Your marines are firmly committed to
    warfighting excellence, and the support of Congress and the American
    people has been indispensable to our success in the global war on
    terrorism. Your sustained commitment to improving our Nation's Armed
    Forces to meet the challenges of today as well as those of the future
    is vital to the security of our Nation. On behalf of all marines and
    their families, I thank this committee for your continued support.
                                i. introduction
        In the near-term, the Marine Corps' top priorities are to maintain
    our high state of readiness and to provide capable forces that meet the
    demanding needs of the unified combatant commanders in order to
    prosecute the global war on terrorism in support of the Nation. For the
    long-term, the Marine Corps and Navy are committed to developing a sea
    basing capability that will provide a critical joint competency for
    assuring access and projecting power that will greatly improve the
    security of the United States. The marked increase in our warfighting
    capability will be apparent as we introduce new systems such as the MV-
    22 Osprey, the Expeditionary Fighting Vehicle (EFV), the Joint Strike
    Fighter (JSF), and the Lightweight 155mm Howitzer into our force
    structure, using them to enhance the already potent combat power of our
    Marine Air-Ground Task Forces (MAGTFs) as integral elements of our
    Nation's joint force.
        The Navy-Marine Corps team continues to play a critical role in the
    global war on terrorism and in the establishment of stability and
    security throughout the world. During this past year, the Marine Corps,
    both active and Reserve, was engaged in operations from Afghanistan to
    the Arabian Gulf, the Horn of Africa, Liberia, the Georgian Republic,
    Colombia, Guantanamo Bay, and the Philippines. Most prominent in
    highlighting the value and power of the Nation's naval expeditionary
    capability was the Marine Corps' participation in Operation Iraqi
    Freedom (OIF). Success in this operation underscored the unique
    contributions of our multi-dimensional naval dominance, our
    expeditionary nature, our flexibility to deal with complex situations
    and challenges, and the adaptability of our forces and individuals in
    order to defeat the challenges posed by adaptive, asymmetric enemies,
    and long-term threats.
        Early last year, the I Marine Expeditionary Force (MEF) deployed a
    combat ready force of almost 70,000 marines and sailors in less than 60
    days using the full array of our complementary power projection
    capabilities. Forward deployed Marine Expeditionary Units (MEUs)
    (Special Operations Capable) again demonstrated their proven value for
    immediate response. Eleven strategically located Maritime Prepositioned
    Force ships were unloaded in 16 days to provide the equipment and
    sustainment for two Marine Expeditionary Brigades. A 7 ship amphibious
    force from each coast embarked a total of 11,500 marines, sailors, and
    their equipment and within 30 days these 14 ships began to arrive and
    offload in Kuwait. Strategic sea and air lift was also vital to our
    success in this effort. Exploiting the operational speed, reach, and
    inherent flexibility of seapower, the Navy-Marine Corps team achieved a
    rapid buildup of sustained warfighting power that was combat ready to
    support U.S. Central Command (CENTCOM) on March 1, 2003.
        Closely integrated with our joint and coalition partners, as well
    as Special Operations Forces (SOF), the I MEF provided the combatant
    commander with a potent combined arms force comprising a balance of
    ground, aviation, and combat service support elements all coordinated
    by a dynamic command element. This teamwork--the product of demanding
    and realistic Service and joint training--presented a multi-dimensional
    dilemma for the Iraqi regime's forces and loyalists. It also greatly
    increased the range of options available to our leadership as they
    addressed each unique and complex situation. The integration of the 1st
    United Kingdom Division within the I MEF provides outstanding lessons
    for achieving merged coalition capabilities and consistent goals in the
    future.
        The combat power of I MEF generated an operational tempo that our
    enemy could not match. With short notice that operations would commence
    early, the marines and their joint and coalition partners rapidly
    secured key strategic objectives. The I MEF then engaged in 26 days of
    sustained combat operations. Using the tenets of maneuver warfare, they
    executed four major river crossings, fought 10 major engagements, and
    destroyed 8 Iraqi divisions before stopping in Tikrit--almost 500 miles
    inland. In support of Joint Special Operations Forces Northern Iraq,
    the 26th MEU inserted a MAGTF from the Eastern Mediterranean into
    Northern Iraq--almost 1,200 miles distance. The sustained resources of
    the Marine Force, which were derived primarily from our seaborne
    logistics, provided us unrivaled advantages. While our logistics were
    stretched by the operational commanders, our combat service support
    units demonstrated flexibility and resourcefulness.
        Highlighting the expeditionary mindset of marines, our combined
    arms force successfully operated in desert, urban, swamp, and rural
    environments while effectively conducting combat, peacekeeping, and
    humanitarian operations--at times simultaneously. Marines also
    demonstrated the ability to re-task and reorganize to conduct
    unanticipated missions like the taking of the city of Tikrit. Following
    major combat operations, I MEF assumed responsibility for security and
    stability in five Central Iraq provinces until they were relieved of
    the last province by coalition forces this past September. Flexibility
    and adaptability are key characteristics of an expeditionary force, and
    they are critical advantages that we must seek to optimize for the
    future, particularly in this era of global uncertainty.
        Recent operations also emphasize the increased importance of access
    to key regions for projecting our Nation's power. With global
    interests, the United States must retain the capability to secure
    access as needed. Power projection from the sea greatly increases the
    range of options available to avert or resolve conflicts. A credible
    naval forcible-entry capability is critical to ensure that we are never
    barred from a vital national objective or limited to suboptimal
    alternatives.
        Since the end of major combat operations, the Marine Corps has been
    setting the force in order to enhance warfighting readiness for future
    contingencies. We are reloading combat equipment and materiel on the
    ships of the Maritime Prepositioned Squadrons while also ensuring that
    the requirements for OIF 2 are fulfilled. We are using provided funding
    to repair, refurbish, and where necessary, replace equipment. During
    this period, marines have continued to forward deploy. Marine Corps
    units are supporting Operation Enduring Freedom (OEF) in Afghanistan,
    operations in the Horn of Africa, exercises critical to supporting the
    Combatant Commanders' Theater Security Cooperation Plans, and
    counterdrug operations in support of joint and joint-interagency task
    forces. In addition, we have conducted a major program to identify and
    analyze lessons learned from the Iraqi campaign. We have also begun to
    assimilate these lessons and determine where and how our force should
    be rebalanced.
        As the last few years have demonstrated, the Marine Corps Reserve
    is a full partner in our total force. Reserve units participated in all
    aspects of the war in Iraq, providing air, ground, and combat service
    support as well as a large number of individual augmentees to marine
    and joint staffs. Mobilized Marine Reserve infantry battalions have
    also served as ready reaction forces, ``on call'' to support the
    Federal Emergency Management Agency's (FEMA) role in homeland security.
                ii. building on success for immediate operations
        We continue to execute global operations and exercises with our
    joint and coalition partners. The Marine Corps is preparing to deploy
    forces to relieve the 3d Armored Cavalry Regiment and the 82d Airborne
    Division in Western Iraq in support of OIF 2. These forces will be
    deployed in two rotations of 7 months each. This rotation policy will
    result in the least disruption for the long-term health of the Marine
    Corps, precluding stop-loss/stop-move and unnecessary interruptions in
    recruit training, career progression and development, professional
    military education, and other deployment requirements. The first
    rotation, from March until September 2004, will include 25,000 marines
    and their equipment and includes almost 3,000 Reserve component
    marines. A second rotation--of like size and composition--will overlap
    the first and ensure a smooth and stable transition.
        In preparation for OIF 2, I MEF has analyzed lessons learned from
    their experiences in conducting security and stability operations from
    March to September 2003, and recent Army lessons learned. As they did
    last year, I MEF is working closely with the Army Forces in Iraq; they
    have conducted a number of liaison visits with the Army units they will
    relieve. They have drawn from procedures used by the Los Angeles Police
    Department for neighborhood patrolling in gang dominated areas, the
    tactics of the British in Iraq--which reflect years of experience in
    low intensity conflicts and peacekeeping operations, as well as the
    Marine Corps' own extensive ``Small Wars'' experience. We have
    assimilated these lessons through a comprehensive training package that
    includes tactics, techniques, procedures for stability and counter-
    insurgency operations. We have conducted rigorous urban operations
    training and exercises. Over 400 marines are receiving Arabic language
    immersion training, and all deploying marines and sailors are receiving
    extensive cultural education. Our supporting establishment is focused
    on the equipment, logistics, and training requirements of this force--
    paying particular attention to individual protective equipment,
    enhanced vehicle and aircraft hardening, and aviation survival
    equipment and procedures. This training and support are critically
    important as we send marines back to war in a volatile, dangerous, and
    changing situation.
        During this next year MEUs will still deploy as part of Naval
    Expeditionary Strike Groups in support of combatant commander
    requirements. Units will continue to rotate to Okinawa and Iwakuni
    Japan, and some of those forces will further deploy in support of OIF
    2. While the operational tempo (OPTEMPO) remains high, recruiting and
    retention continue to exceed our goals. We are monitoring the health of
    our Service, and we are focused on ensuring that the Marine Corps
    remains ready for all current and future responsibilities.
                          iii. taking care of our own
        Events of the past year continue to highlight the value of the
    individual marine over all other weapon ``systems.'' While we always
    strive to provide our marines with the best equipment and weapons, we
    never forget that people and leadership are the foundations of the
    Marine Corps' readiness and warfighting capabilities. OIF demonstrated
    that the Marine Corps' recruiting, training, and education of the force
    are extremely successful in maintaining the high standards of military
    readiness our Nation requires. The Marine Corps remains committed to
    taking care of our marines, their families, and our civilian marines.
    Marines
        End Strength
        The Marine Corps is assimilating the congressionally authorized
    increase in Marine Corps end strength to 175,000. The increase of 2,400
    marines previously authorized by Congress addressed an urgent need to
    train and maintain enough marines for the long-term requirements
    associated with the global war on terrorism. It has been particularly
    important in enabling us to provide the Nation with a robust, scalable
    force option specifically dedicated to antiterrorism--the 4th Marine
    Expeditionary Brigade (Antiterrorism).
        The Marine Corps is expeditionary by nature and therefore
    accustomed to deploying in support of contingency and forward presence
    missions. We are structured in such a way as to satisfy our enduring
    requirements and meet operational contingencies as long as the
    contingencies are temporary in nature. While the force is stretched, we
    are meeting our current challenging operational commitments. Our high
    operational and personnel tempos have not negatively impacted
    accessions or retention efforts; however, we continue to monitor both
    very closely.
        Recruiting
        Sustaining our ranks with the highest quality young men and women
    is the mission of the Marine Corps Recruiting Command. Recruiting
    Command has consistently accomplished this mission for more than 8
    years for enlisted recruiting and 13 years for officer recruiting. This
    past year the Marine Corps recruited over 100 percent of its goal with
    over 97 percent Tier I High School graduates. In order to continue
    attracting America's finest youth, Recruiting Command provides its
    recruiters the best tools available to accomplish their mission.
        The Marine Corps Reserve achieved its fiscal year 2003 recruiting
    goals with the accession of 6,174 non-prior service marines and 2,663
    prior service marines. With regard to our Reserve component, officer
    recruiting and retention to fill out the requirements of our Selected
    Marine Corps Reserve (SMCR) units remains our most challenging concern.
    This is primarily due to the fact that we recruit Reserve officers
    almost exclusively from the ranks of those who have first served a tour
    as an active duty marine officer and currently the Corps is
    experiencing a low attrition rate for company grade officers in our
    Active Force. We are attempting to alleviate this challenge. Two
    successful methods include increasing awareness of the benefits of
    service in the Reserves to the company grade officers who are leaving
    the active ranks and Reserve officer programs for qualified enlisted
    marines.
        Retention
        Retaining the best and the brightest marines is a constant goal;
    history has proven that superb leadership in the staff noncommissioned
    officer ranks is a major contributor to the Corps' combat
    effectiveness. The ranks of this elite group of leaders can only be
    filled by retaining our best enlisted marines. The Marine Corps has two
    retention measures and both clearly indicate healthy service
    continuation rates. Our First Term Alignment Plan (first tour) has
    consistently achieved its reenlistment requirements over the past 9
    years. With just over one-third of the current fiscal year completed,
    we have achieved 76 percent of our first-term retention goal.
    Furthermore, our Subsequent Term Alignment Plan (second tour and
    beyond) reveals that we have already retained 47 percent of our goal
    for this fiscal year.
        Current officer retention is at a 19-year high, continuing a 4-year
    trend of increasing retention. Despite the increased retention overall,
    certain military occupational specialties perennially suffer high
    attrition. We are attempting to overcome this challenge by offering
    continuation pay for those marines with military occupational
    specialties that include special qualifications and skills. Military
    compensation that is competitive with the private sector provides the
    flexibility required to meet the challenge of maintaining stability in
    manpower planning.
        Marine Corps Reserve
        In 2003, the Marine Corps Reserve rapidly mobilized combat ready
    marines to augment and reinforce the active component. Marine Corps
    Reserve activations in support of OIF began in January 2003, and peaked
    at 21,316 Reserve marines on active duty in May 2003. This represented
    52 percent of the SMCR. Of the approximately 6,000 reservists currently
    on active duty, over 1,300 individual mobilization augmentees,
    individual ready reserves, and retirees fill critical joint and
    internal billets. As of January 2004, the Marine Corps Reserve began
    activating approximately 7,000 SMCR marines in support of OIF 2.
    Judicious employment of Reserve marines remains a top priority of the
    Marine Corps to ensure the Marine Corps Reserve maintains the
    capability to augment and reinforce the active component. Marine Corps
    Reserve units and individuals are combat ready and have rapidly
    integrated into Active Forces commands demonstrating the effectiveness
    of the Total Force Marine Corps.
        A strong inspector-instructor system and a demanding Mobilization
    and Operational Readiness Deployment Test program ensured Marine Corps
    Reserve units achieved a high level of premobilization readiness.
    Marine Reserve Units continuously train to a C1/C2 readiness standard,
    eliminating the need for post-mobilization certification. Ninety-eight
    percent of SMCR marines called up for duty reported for mobilization
    and less than 1 percent requested a deferment, delay, or exemption. The
    Marine Corps Reserve executed a rapid and efficient mobilization with
    units averaging 6 days from notification to being deployment-ready, and
    32 days after receiving a deployment order they arrived in theater.
    Many activated Marine Reserve units were ready to deploy faster than
    strategic lift could be provided.
        Building on the important lessons of the last year, the Marine
    Corps is pursuing several transformational initiatives to enhance the
    Reserves' capabilities as a ready and able partner with our active
    component. These pending initiatives include: increasing the number of
    Military Police (MP) units in the Reserve component; establishing a
    Reserve Intelligence Support Battalion to include placing Reserve
    Marine Intelligence Detachments at the Joint Reserve Intelligence
    Centers; returning some of our civil affairs structure to the active
    component to provide enhanced planning capabilities to the operational
    and Service headquarters; and, introducing an improved Individual
    Augmentee Management Program to meet the growing joint and internal
    requirements.
        When called, the Marine Corps Reserve is ready to augment and
    reinforce. Our Reserve marines are a vital and critical element of our
    total force. The training, leadership, and quality of life of our
    Reserve component remain significant Marine Corps priorities.
        Marine For Life
        The commitment to take care of our own includes a marine's
    transition from active service back to civilian life. The Marine For
    Life Program's mission is to provide sponsorship for our more than
    27,000 marines who honorably leave active service each year. The
    program was created to nurture and sustain the positive, mutually
    beneficial relationships inherent in our ethos, ``Once a Marine, Always
    a Marine.'' In cities across the United States, Reserve marines help
    transitioning marines and their families get settled in their new
    communities. Sponsorship includes assistance with employment,
    education, housing, childcare, veterans' benefits, and other support
    services needed to make a smooth transition. To provide this support,
    Marine For Life taps into the network of former marines and marine-
    friendly businesses, organizations, and individuals willing to lend a
    hand to a marine who has served honorably.
        Initiated in fiscal year 2002, the program will reach full
    operational capability in fiscal year 2004. In addition to 110 Reserve
    marines serving as ``Hometown Links,'' an enhanced web-based electronic
    network, easily accessed by marines worldwide, will support the
    program. The end state of the Marine For Life Program is a nationwide
    marine and marine-friendly network available to all marines honorably
    leaving active service, that will improve their transition to civilian
    life.
    Civilian Marines
        Civilian Workforce Campaign Plan
        Recognizing that our civilian marines are integral to the success
    of military operations, General James L. Jones, the 32nd Commandant of
    the Marine Corps, charged our senior Marine Corps officials with the
    development and implementation of a strategic 5-year plan for the
    recruitment, development, and retention of our civilian marines. The
    Civilian Workforce Campaign Plan (CWCP) consists of six strategic
    goals: (1) nurture, build, and grow civilian marines; (2) provide
    flexible career opportunities; (3) create leaders at all levels; (4)
    improve the performance evaluation system; (5) strengthen workforce
    management expertise; and (6) establish an integrated total force
    management approach. As commandant, I have provided the following
    additional implementing guidance.
        Our vision is to make the Marine Corps the employer of choice for a
    select group of civilians imbued with the Marine Corps values of honor,
    courage, and commitment. Through implementation of the CWCP, we will
    not only define what the Marine Corps will offer its civilian marines,
    but what the Corps expects from them. We will attract, nurture, build,
    and grow civilian marines by providing innovative recruitment,
    development, retention, reward, and acculturation programs throughout
    the work-life cycle.
        National Security Personnel System
        We want to take this occasion to thank again the committee and
    Congress for enacting the National Security Personnel System (NSPS) in
    the National Defense Authorization Act for Fiscal Year 2004. The act
    authorized a more flexible civilian personnel management system for the
    Department of Defense (DOD) that allowed DOD to be a more competitive
    and progressive employer at a time when our national security demands a
    highly responsive system of civilian personnel management. The
    legislation ensures that merit system principles govern any changes in
    personnel management, whistleblowers are protected, discrimination
    remains illegal, and veterans' preference is protected. The Department
    will collaborate with employee representatives, invest time to try and
    work out our differences, and notify Congress of any differences before
    implementation. In January, DOD officials met with union
    representatives to begin the development of a new system of labor-
    management relations. Later this year, following an intensive training
    program for supervisors, managers, human resources specialists,
    employees, as well as commanders and senior management, the DOD plans
    to begin implementing NSPS. The Marine Corps, along with the entire
    Department of the Navy, expects to be in the first wave of
    implementation.
        Military-Civilian Conversions
        The Marine Corps will continue to actively pursue a review of all
    functional areas within the Marine Corps in an effort to return more
    marines to the operating forces. Through fiscal year 2003, we have
    returned over 2,000 manned structure spaces to the operating forces,
    and we will return approximately 650 more marines in fiscal year 2004.
    The fiscal year 2005 President's budget converts roughly an additional
    1,400 more billets from marines to civilian marines, which will provide
    us more options to increase manning in the operating forces.
    Education
        Amid today's uncertain, volatile security environment, our most
    effective weapon remains the individual marine who out-learns, out-
    thinks, and out-fights any adversary. Such warfighting competence is
    secured only through intellectual development. Recent events
    demonstrated how quality education instills confidence in marines. Our
    educational standards and programs produce innovative leaders who take
    initiative and excel during challenging situations involving
    uncertainty and risk. These high educational standards are inculcated
    by the Marine Corps University and are designed to target every rank in
    both our Active and Reserve Forces. Each year the Marine Corps
    University student population includes members of the other Services,
    various government agencies as well as dozens of international military
    officers from over 30 different countries.
        The Marine Corps endeavors to provide its marines with `lifelong
    learning' opportunities through a variety of educational programs,
    college courses, and library services on our bases and stations.
    Furthermore, distance learning programs through the Marine Corps
    University make continuing education available to marines regardless of
    their location. In addition, the Marine Corps will continue to fully
    fund the Tuition Assistance Program in accordance with DOD guideline--
    funding for 100 percent of tuition cost up to $250 per semester hour
    with a maximum of $4,500 per year. In fiscal year 2003, there were
    25,662 marines enrolled in almost 80,000 courses with the help of the
    Tuition Assistance Program.
        Joint Initiatives
        The Marine Corps synchronizes its educational objectives with those
    of the other armed services in order to provide regional combatant
    commanders with the most capable joint force. We support the proposal
    for a Joint Advanced Warfighting School (JAWS) and for broadening Joint
    Professional Military Education (JPME) opportunities for the Total
    Force. By working closely with Joint Forces Staff College and our
    sister services, JAWS has the potential to empower future combatant
    commanders with talented officers who are experienced in campaign
    planning. Intent on broadening our joint experience base, the Marine
    Corps is pursuing an accredited advanced joint curriculum (JPME Phase
    II) at the Marine Corps War College and will continue to work to
    provide JPME opportunities for both active and Reserve components.
        Senior Leader Development Program
        The Senior Leader Development Program was developed last year to
    address General Officer and Senior Executive Service career development
    and to link education opportunities to career progression. A study was
    commissioned to identify the competencies required in each of our
    general officer billets in an effort to link core and complimentary
    curriculum with the assignment process. Within the core curriculum,
    senior leaders will attend the Joint Warfare series of courses as
    prerequisites by rank and billet while they study innovation, business
    transformation, and resource management through complementary courses.
    Quality of Life/Quality of Service
        The Marine Corps works to improve the quality of life for marines
    and their families in order to continue the success of the all
    volunteer force. We provide excellent quality of life programs and
    services, while also helping new marines to better understand what to
    expect in the military lifestyle. We continuously assess, through a
    variety of means, the attitudes and concerns of marines and their
    families regarding their quality of life expectations. With 67 percent
    of our marines deployed away from their home installations at the
    height of OIF, we carefully captured lessons learned to ensure quality
    of life programs meet the needs of deployed marines and families who
    remain at home. Community and family assistance centers were
    established at Camp Lejeune, Camp Pendleton, Marine Corps Air Station
    Miramar, and Marine Corps Base Twentynine Palms to provide marine
    family members and loved ones access to relevant information and
    referral services.
        To further help marines and their families before, during, and
    after deployments, the Marine Corps implemented Marine Corps Community
    Services (MCCS) One Source, a Marine Corps-conducted, DOD funded pilot
    program providing around-the-clock information and referral services.
    MCCS One Source is especially useful to our activated Marine Reserves
    and their families as they negotiate the requirements and procedures
    associated with utilization of military programs such as TRICARE and
    other benefit services. In recognition of the importance of the
    transition home after deployments for both marines and their families,
    the Marine Corps developed a standardized return and reunion program
    consisting of a mandatory warrior transition brief for returning
    marines, a return and reunion guidebook for marines and family members,
    a caregiver brief, and briefs designed for spouses.
        We greatly appreciate the supplemental appropriations bills during
    2003, that contained additional help for deployed marines and their
    families. In 2004, quality of life efforts will continue to focus on
    issues related to supporting deployed forces and their families.
    Safety
        Safety programs are vital to force protection and operational
    readiness. Marine leaders understand the importance of leadership,
    persistence, and accountability in the effort to reduce mishaps and
    accidents. The fiscal year 2003 off-duty and operational mishap rates
    were driven upward by the mishaps that occurred during and post OIF,
    while the aviation mishap rate decreased. To meet the Secretary of
    Defense's challenge to all Services to reduce mishaps by 50 percent in
    2 years, the Marine Corps is focusing on initiatives that deal
    particularly with the development of strategies and specific
    interventions to reduce all mishaps. Our leadership at every level
    understand the challenge, and we are actively involved in the effort to
    safeguard our most precious assets--marines and sailors.
                     iv. building on success for the future
        The Marine Corps, in partnership with our Navy brethren, provides
    our Nation with unrivaled maritime power to help secure peace and
    promote our national interests. The President's fiscal year 2005
    budget, together with your support, will provide a strong foundation
    for our continued success. The fiscal year 2005 budget--predicated on a
    peacetime OPTEMPO--sustains a high level of readiness and ensures our
    ability to rapidly respond to emerging situations. It also allows us to
    assimilate new technologies and explore new concepts that will help
    realize the full potential of our people and their equipment. We will
    continue to seek improved means to increase the efficiency of our
    investments and increase the combat effectiveness of our forces.
    Technology and Experimentation
        The Marine Corps has a long history of innovation and adaptation.
    Experimentation is our principle means to explore new ideas and
    technologies in order to develop new capabilities to overcome emerging
    challenges. The Marine Corps Combat Development Command has realigned
    its experimentation program around the Sea Viking campaign. This
    campaign will explore both concept and prototype technology development
    pathways leading to the sea-based expeditionary capabilities envisioned
    for the future, to include forcible entry from the sea. The Sea Viking
    campaign is complementary to the joint concept development and
    experimentation campaign of Joint Forces Command (JFCOM) and the Navy's
    Sea Trial experimentation process. As an integral part of this effort,
    the Marine Corps is refining the expeditionary combat capabilities best
    suited to participate in future Expeditionary Strike Group (ESG) and
    Expeditionary Strike Force operations. It is also exploring the
    potential for an expanded Seabasing capability in support of future
    joint operations.
        The Marine Corps Warfighting Laboratory has experimented with
    several new pieces of equipment to enhance individual and small unit
    effectiveness. Based on successful experimentation, limited numbers of
    the M16A4 Modular Weapons System, Rifle Combat Optic, and the
    Integrated Intra Squad Radio were fielded for use during OIF. The
    Marine Corps continues to seek enhanced capabilities for the future as
    we continue to improve and transform the force. In addition, we have
    procured sufficient quantities of the Outer Tactical Vest and its Small
    Arms Protective Insert plates to ensure all marines participating in
    OIF 2 are equipped with enhanced ballistic protection.
    New Concepts and Organizations
        The Expeditionary Force Development System implemented this past
    year is a methodological process that is designed to facilitate the
    development and realization of military operational concepts. It is a
    streamlined and integrated system that covers all phases of concept
    development to the acquisition of necessary equipment and weapons
    systems. The Expeditionary Force Development System proved to be of
    great value to our forces engaged in combat operations and is proving
    to be a helpful means of ensuring that the Marine Corps quickly profits
    from recent operational experiences. The system is compatible with and
    supports naval and joint transformation efforts as it integrates
    transformational, modernization, and legacy capabilities and processes.
    Several emerging concepts and organizational structures are maturing
    that will benefit the Marine Corps and ensure we can meet the future
    demanding requirements of the combatant commanders.
        The Sea Basing Concept
        Sea basing, envisioned as a national capability, is our overarching
    transformational operating concept for projecting and sustaining multi-
    dimensional naval power and selected joint forces at sea. As stated by
    the Defense Science Board in its August 2003 Task Force report: ``Sea
    basing represents a critical future joint military capability for the
    United States.'' It assures joint access by leveraging the operational
    maneuver of forces globally from the sea, and reduces joint force
    operational dependence upon fixed and vulnerable land bases. Sea basing
    unites our capabilities for projecting offensive power, defensive
    power, command and control, mobility and sustainment around the world.
    This will provide our regional combatant commanders with unprecedented
    versatility to generate operational maneuver. Sea basing will allow
    Marine Forces to strike, commence sustainable operations, enable the
    flow of follow-on forces into theater, and expedite the reconstitution
    and redeployment of Marine Forces for follow-on missions. As the core
    of naval transformation, sea basing will provide the operational and
    logistical foundation to enable the other pillars of naval
    transformation (Sea Strike, Sea Shield, Sea Base, and FORCEnet).
        This year, the Marine Corps has continued to refine plans for the
    Marine Expeditionary Brigade of 2015, in concert with our concept for
    sea-based operations. Similarly, the analysis of alternatives for our
    Maritime Prepositioning Force (Future) (MPF(F)), a critical component
    of Seabasing, will provide valid choices for achieving Seabasing
    capabilities. These initiatives will complement, rather than replace,
    the amphibious lift and forcible entry capacity of the LHA(R), LPD-17,
    and LHD, and will provide the Nation a deployment and employment
    capability unmatched in the modern world.
        Expeditionary Strike Groups
        The Marine Corps and Navy continue the series of experiments that
    will refine the ESG concept. This concept will combine the capabilities
    of surface action groups, submarines, and maritime patrol aircraft with
    those of Amphibious Ready Groups and enhanced MEUs (Special Operations
    Capable) to provide greater combat capabilities to regional combatant
    commanders. Navy combatants are incorporated within the existing
    training and deployment cycle of the Amphibious Ready Group. Further
    experimentation will also allow us to test command-and-control
    arrangements for the ESG. We will soon complete the pilot deployment in
    this series, ESG-1, composed of West Coast Navy and Marine Forces. The
    ESG-2, composed of East Coast Navy and Marine Forces, will deploy later
    this year. Currently, the Marine Corps Combat Development Command is
    working with Navy and Marine operating forces to capture critical
    information from these experimental deployments to ensure that the ESG
    capability thoroughly integrates doctrine, organization, training,
    materiel, leadership, education, personnel, and facilities. Also, the
    Marine Corps Combat Development Command is working with the Navy to
    develop the concept for the employment of the additional capabilities
    that the ESG provides regional combatant commanders. Finally, the
    Center for Naval Analyses is evaluating the series of experiments
    through embedded analysts deployed with both ESGs and will submit their
    consolidated reports to the Navy and Marine Corps in October 2004.
        Marine Corps--U.S. Special Operations Command Initiatives
        The Marine Corps continues to aggressively improve interoperability
    with SOF. The U.S. Special Operations Command-Marine Corps Board has
    developed over 30 initiatives to support our interoperability goals.
    The Marine Corps and U.S. Special Operations Command (SOCOM) are
    working to leverage existing pre-deployment and deployment training as
    a means to ``operationalize'' our relationship. Our deploying MEUs
    (Special Operations Capable) exchange liaison officers with the Theater
    Special Operations Commands as the MEUs deploy within the various
    theaters. On June 20, 2003, a Marine Corps ``proof of concept''
    detachment that is task organized to complement SOCOM mission areas in
    Direct Action, Special Reconnaissance, Coalition Support and Foreign
    Internal Defense formally stood up at Camp Pendleton, California. The
    Detachment transferred to the operational control of SOCOM last
    December, to facilitate joint pre-deployment training and is scheduled
    to deploy in April 2004, with a Naval Special Warfare Squadron
    supporting CENTCOM. Finally, we are conducting joint training with
    SOCOM in the areas of fixed and rotary wing air support of special
    operation missions.
        Reestablishment of Air-Naval Gunfire Liaison Companies
        During this past summer the Marine Corps reestablished an Air-Naval
    Gunfire Liaison Company in I MEF and another in the II MEF. These
    companies provide teams that specialize in all aspects of fire
    support--from terminal control to support of division fire support
    coordination centers. They greatly enhance the MAGTF Commanders'
    liaison capability--with foreign area expertise--to plan, coordinate,
    employ, and conduct terminal control of fires in support of joint,
    allied, and coalition forces. Each company will be fully stood up by
    this summer, and a separate platoon will be stood up in III MEF in
    October 2004.
        Tactical Aircraft Integration
        Naval Tactical Aircraft (TACAIR) Integration makes all naval
    strike-fighter aircraft available to meet both Services' warfighting
    and training requirements. As part of the TACAIR Integration plan, a
    Marine fighter-attack squadron will eventually be attached to each of
    the 10 active carrier air wings and will deploy aboard aircraft
    carriers. In addition, three Navy strike-fighter squadrons will be
    assigned into the Marine Corps' Unit Deployment Program for land-based
    deployments. Force structure reductions associated with this plan
    should result in a total cost savings and cost avoidance of over $30
    billion. The integration of the fifth marine squadron into a Carrier
    Air Wing and the first Navy squadron into the Unit Deployment Program
    are scheduled for later this year.
        TACAIR Integration retains our warfighting potential and brings the
    naval services a step closer to the flexible sea based force we
    envision for the future. A leaner, more efficient naval strike-fighter
    force is possible because of three underlying factors. The first factor
    is ``Global Sourcing''--the ability to task any non-deployed Department
    of Navy squadron to either Service's missions, allowing for a reduction
    in force structure. Second, `Level Readiness'--applying the proper
    resources to training, maintenance, and modernization, will ensure the
    smaller force is always capable of responding to the Services' and
    Nation's needs. Third, the development of an operational concept that
    will efficiently manage the employment of this integrated strike-
    fighter force within the naval and joint context. Support of readiness
    accounts, modernization programs, and our replacement of the F/A-18 and
    AV-8B with the short takeoff and vertical landing (STOVL) JSF will
    ensure the potential promised by this integration.
    Better Business Practices
        The Secretary of Defense and Secretary of the Navy have emphasized,
    and the Marine Corps is committed to, business transformation in order
    to optimize resource allocation. The Marine Corps is employing a
    variety of business transformation initiatives including: competitive
    sourcing of over 3,500 commercial billets to save $57 million annually;
    outsourcing garrison food service in our mess halls in the continental
    United States in to free up 594 marines for other duties; using public-
    private ventures to fund new family housing and to increase the
    quantity of safe, comfortable, and affordable homes; consolidation of
    equipment maintenance from five to three echelons in order to improve
    maintenance effectiveness and efficiency; and, regionalizing garrison
    mobile equipment to realign marines and dollars with higher priorities.
    The Marine Corps continues to develop its activity based costing
    capability in order to support fact based decision making.
        In March 2003, the Marine Corps began participation in the Navy
    Marine Corps Intranet (NMCI)--a network outsourcing initiative that
    will provide a common end-to-end Department of the Navy information
    system capability for voice, video, and data communications. By
    outsourcing information technology services not considered to be core
    competencies, the Marine Corps has been able to return 355 supporting
    establishment personnel structure spaces to the operating forces. As a
    result of this improved business practice, the NMCI operating
    environment will promote greater naval interoperability. The Marine
    Corps will continue to refine our business practices and increase the
    effectiveness of warfighting potential.
                 v. our main effort--excellence in warfighting
    Training
        Training at Eglin Air Force Base
        In anticipation of the cessation of naval expeditionary forces
    training in Vieques, Puerto Rico, efforts began in September 2002 to
    establish a new training capability at Eglin Air Force Base (AFB).
    Training at Eglin AFB is envisioned to provide a near-term pre-
    deployment training capability for East Coast Navy Amphibious Ready
    Groups/ESGs and MEUs (Special Operations Capable), with the potential
    to be part of the long-term solution. The training concept was designed
    for up to two 10-day training periods per year. The long-term objective
    is that during each 10-day event, the ESGs will be able to conduct the
    full spectrum of training required. The Marine Corps has invested
    approximately $4.2 million in environmental assessment/mitigation and
    infrastructure development required to establish an initial training
    capability at Eglin AFB.
        In December 2003, the Marine Corps completed its first 10-day
    training period at Eglin AFB, at an additional cost of approximately $1
    million. The Marine Corps is assessing the quality the training offered
    at Eglin AFB while continuing to explore and develop other options,
    both within the United States and abroad. While Eglin AFB has the
    potential for enhanced live fire and maneuver training, developing this
    capability will require a significant investment by the Department of
    the Navy and DOD to upgrade existing facilities.
        Joint National Training Capability
        As described by the Deputy Secretary of Defense: ``The centerpiece
    of our Training Transformation effort will be a Joint National Training
    Capability.'' The Joint National Training Capability is one of the
    three pillars of Training Transformation, and will improve joint
    interoperability by adding certified `joint context' to existing
    Service training events. The Joint National Training Capability is a
    cooperative collection of interoperable training sites, nodes, and
    events that synthesizes combatant commander and Service training
    requirements with the appropriate level of joint context.
        The first in a series of pre-Initial Operational Capability (IOC)
    Joint National Training Capability exercises was held in January 2004,
    linking a Marine Corps Combined Arms Exercise with live close air
    support sorties, a Navy Stand-off Land Attack Missile Exercise, an Army
    rotation at the National Training Center, and an Air Force Air Warrior
    Exercise. The Marine Corps will be actively involved in future Joint
    National Training Capability exercises including Combined Arms
    Exercises and Marine Aviation Weapons and Tactics Squadron-1 evolutions
    scheduled for fiscal year 2005. The Marine Corps is fully engaged in
    the Joint National Training Capability program development, and is on
    track to enhance Service core-competency training with the appropriate
    level of joint context. In concert with the other Services, the Marine
    Corps is working with JFCOM to refine the phrase ``joint context,''
    certify ranges, and accredit exercises to ensure the force is training
    properly.
    Infrastructure
        Blount Island Facility
        The acquisition of the Blount Island facility in Jacksonville,
    Florida, is critical to our Nation and to our Corps' warfighting
    capabilities. Blount Island's peacetime mission is to support the
    Maritime Prepositioning Force. Its wartime capability and capacity to
    support massive logistics sustainment from the continental United
    States gives it strategic significance. The Blount Island facility has
    a vital role in the National Military Strategy as the site for
    maintenance operations of the Maritime Prepositioning Force. The Marine
    Corps thanks Congress for your role in supporting this acquisition
    project. Phase II, funded by the $115.7 million appropriated in the
    Defense Authorization Act of 2004, gives the Marine Corps ownership of
    the leased maintenance area and supporting dredge disposal site
    consisting of 1,089 acres.
        Encroachment
        We are grateful to Congress for providing a tool to facilitate the
    management of incompatible developments adjacent to or in close
    proximity to military lands. We are working with state and local
    governments and with non-governmental organizations such as the Trust
    for Public Lands, The Nature Conservancy, the Sierra Club, and the
    Endangered Species Coalition to acquire lands buffering or near our
    bases including Camp Lejeune, Marine Corps Air Station Beaufort, and
    Camp Pendleton. In return for our investment, the Marine Corps is
    receiving restrictive easements that ensure lands acquired remain
    undeveloped and serve as buffer zones against future encroachment on
    our bases.
        We are also grateful to Congress for codifying legislation that
    gives us the opportunity to partner with the U.S. Fish and Wildlife
    Service and State fish and game agencies in order to manage endangered
    species present on military lands. Management via our Integrated
    Natural Resources Management Plans, which we prepare in partnerships
    with these agencies, allows us to protect and enhance populations of
    these species on our lands while allowing marines to train. Finally, we
    support the Secretary of Defense's efforts to provide flexibility under
    the Clean Air Act and to clarify the governing authorities under which
    the DOD would manage operational ranges. The Marine Corps strives to be
    a good environmental steward and the growing number of endangered
    species on our lands and their increasing populations are examples of
    our successes. We remain committed to protecting the resources
    entrusted to us by the American people.
        Base Realignment and Closures
        A successful Base Realignment and Closure (BRAC) process, resulting
    in recommendations in 2005, is critically important to the Nation, the
    DOD, and the Department of Navy. By eliminating excesses and improving
    efficiencies, the armed services will achieve a transformation of our
    infrastructure in the same way we are achieving a transformation of our
    forces. Recommendations will be developed only after a thorough and in-
    depth review.
    Command and Control
        Naval expeditionary warfare will depend heavily on the ability of
    the forces to share linked and fused information from a common source
    which will, in turn, ensure command and control of widely dispersed
    forces. Exploiting the use of space, ground and aerial platforms
    requires a networked, protected, and assured global grid of
    information. Leveraging command and control technology to improve our
    interoperability continues to be our focus of effort.
        Advances in technology and a need to leverage existing
    infrastructure requires us to establish a new information technology
    (IT) framework--one that is more reliable, efficient, secure, and
    responsive. This new IT framework must provide enhanced information
    access and improved information services to the operating forces. By
    streamlining the deployment of IT tools and realigning our IT
    resources, the Marine Corps Enterprise IT Services will shift the
    burden away from the operating forces by establishing a new IT
    environment. This IT environment will fuse and integrate Department
    wide, net-centric enterprise services to provide a common set of
    sharable IT services to the entire Marine Corps. By eliminating
    individual organizations providing duplicative and redundant services,
    we will reduce the IT burden on the operating forces through enterprise
    provided IT services, and improve our ability to process information
    and enhance the speed of decisionmaking.
    Intelligence
        Our fiscal year 1996 through fiscal year 2004 enhancements to
    Marine Corps intelligence improved the intelligence capability within
    Marine Corps units and established a ``reach-back'' intelligence
    production capability between forward deployed units and our Marine
    Corps Intelligence Activity in Quantico, Virginia. These improvements
    are proving to be remarkably beneficial to our efforts in OIF and OEF.
    Marine intelligence is concurrently supporting ongoing operations,
    preparing for near term operations, and transforming our intelligence
    systems to meet future warfighting requirements. Marine Intelligence
    Specialists have provided significant contributions to ongoing
    operations in Iraq, Afghanistan, and Djibouti and will play a crucial
    intelligence role as Marine Forces return to Iraq in larger numbers
    this year. Before again deploying to Iraq, we will train over 400
    marines in basic Arabic to aid in our efforts to work with the Iraqis
    at the patrol level, and we will provide enhanced language training for
    some of our Arabic heritage speakers and others trained linguists to
    increase our operational influence and effectiveness. Meanwhile, we
    prepare for future conflicts by ensuring that our intelligence training
    and systems funded in the fiscal year 2005-2009 program incorporate the
    latest technological advances and become more capable of seamless
    interoperability with the systems used by other Services and national
    agencies.
    Mobility
        As preliminary assessments of operations in Iraq highlight,
    operational and tactical mobility are essential to overcome the current
    range of threats. The ability to rapidly respond and then flexibly
    adapt to a changing situation is critical to address future challenges.
    Increasing the speed, range, and flexibility of maneuver units that are
    enhanced by logistical power generated from the sea, will increase
    naval power projection. The following initiatives are vital to achieve
    greater operational mobility:
        MV-22 Osprey
        The MV-22 remains the Marine Corps' number one aviation acquisition
    priority. While fulfilling the critical Marine Corps medium lift
    requirement, the MV-22's increased range, speed, payload, and
    survivability will generate truly transformational tactical and
    operational capabilities. With the Osprey, Marine Forces operating from
    a sea base will be able to take the best of long-range maneuver and
    strategic surprise, and join it with the best of the sustainable
    forcible-entry capability. Ospreys will replace our aging fleets of CH-
    46E Sea Knight and CH-53D Sea Stallion helicopters.
        KC-130J
        Continued replacement of our aging KC-130 fleet with KC-130J
    aircraft is necessary to ensure the viability and deployability of
    Marine Corps Tactical Air and Assault Support well into the 21st
    century. Acquisition of the KC-130J represents a significant increase
    in operational efficiency and enhanced refueling and assault support
    capabilities for the Marine Corps. The KC-130J provides the aerial
    refueling and assault support airlift resources needed to support the
    Osprey, the JSF, and the MAGTF and Joint Force Commanders.
    Expeditionary Fighting Vehicle
        The EFV, formerly known as the Advanced Amphibious Assault Vehicle
    (AAAV), will provide Marine Corp surface assault elements the requisite
    operational and tactical mobility to exploit fleeting opportunities in
    the fluid operational environment of the future. Designed to be
    launched from naval amphibious shipping from over the horizon, the EFV
    will be capable of carrying a reinforced Marine Corp rifle squad at
    speeds in excess of 20 nautical miles per hour in sea state three. This
    capability will reduce the vulnerability of our naval forces to enemy
    threats by keeping them well out to sea while providing our surface
    assault forces mounted in EFVs the mobility to react to and exploit
    gaps in enemy defenses ashore. Once ashore, EFV will provide Marine
    Corp maneuver units with an armored personnel carrier designed to meet
    the threats of the future. EFV will replace the aging Assault
    Amphibious Vehicle (AAV). With its high speed land and water
    maneuverability, highly lethal day/night fighting ability, and advanced
    armor and Nuclear, Biological, and Chemical (NBC) protection, the EFV
    will significantly enhance the lethality and survivability of Marine
    Corp maneuver units and provide the MAGTF and ESG with increased
    operational tempo across the spectrum of operations.
        Power Projection Platforms
        Combined with embarked marines, amphibious warships provide our
    Nation with both a forward presence and a flexible crisis response
    force. These power projection platforms give decisionmakers immediately
    responsive combat options. As the sea basing concept matures, enhanced
    naval expeditionary forces will be optimized to provide a full spectrum
    of capabilities.
        Inherent in the Sea Strike pillar of the sea basing concept is the
    ability to both strike with fires from the sea base and from units
    maneuvering within the littoral region. The dilemma that these two
    offensive capabilities impose on an enemy and the multitude of options
    they create for our leadership increase our ability to achieve success
    effectively and efficiently. The built-in flexibility and survivability
    of amphibious ships coupled with their combat sustainment capability
    ensure the rapid achievement of a full range of offensive operations
    that either allow us to accomplish operational objectives directly or
    enable us to set the conditions for major joint operations. The ability
    to defeat an anti-access strategy--before it is completed or even once
    it is developed--is vital to our national security objectives.
        The LPD 17 class amphibious ships, currently planned or under
    construction, represent the Department of the Navy's commitment to a
    modern expeditionary power projection fleet. These ships will assist
    our naval forces in meeting the fiscally-constrained programming goal
    of lifting 2.5 Marine Expeditionary Brigade Assault Echelons (AEs). The
    lead ship detail design has been completed and the construction process
    is over 80 percent, complete with a successful launch in July 2003.
    Production effort is focused on meeting test milestones for a November
    2004 delivery. Construction of LPD 23 has been accelerated from fiscal
    year 2006 to fiscal year 2005, leveraging Fiscal Year 2004 Advance
    Procurement resources provided by Congress. LPD 17 replaces four
    classes of older ships--the LKA, LST, LSD, and the LPD--and is being
    built with a 40-year expected service life.
        LHAs 1-5 reach their 35-year service life at a rate of one per year
    in 2011-2015. LHD-8 will replace one LHA when it delivers in fiscal
    year 2007. In order to meet future warfighting requirements, the Navy
    and Marine Corps leadership is evaluating LHA (Replacement)--LHA(R)--
    requirements in the larger context of joint sea basing, power
    projection, the global war on terrorism, and lessons learned from OEF
    and OIF. The resulting platform will provide a transformational
    capability that is interoperable with future amphibious and Maritime
    Preposition Force ships, high-speed connectors, advanced rotorcraft
    like the MV-22, JSF, and EFVs.
        Maritime Prepositioning Force
        The leases on the current Maritime Prepositioning Ships begin to
    expire in 2009. The MPF(F) will be a key enabler to sea-based
    operations. It will allow us to better exploit the maneuver space
    provided by the sea to conduct joint operations at a time and place of
    our choosing. When the MPF(F) becomes operational, the maritime
    prepositioning role will expand far beyond its current capability to
    provide the combat equipment for a fly-in force. MPF(F) will serve four
    functions that the current MPF cannot: (1) at-sea arrival and assembly
    of units; (2) direct support of the assault echelon of the Amphibious
    Task Force; (3) long-term, sea-based sustainment of the landing force;
    and (4) at-sea reconstitution and redeployment of the force. The
    enhanced capabilities of these ships will significantly increase the
    capability of the Sea Base--in the sea basing concept--to provide
    unimpeded mobility and persistent sustainment. This enhanced sea base
    will minimize limitations imposed by reliance on overseas shore-based
    support, maximize the ability of the naval elements of the joint force
    to conduct combat operations from the maritime domain, and enable the
    transformed joint force to exploit our Nation's asymmetric advantage of
    our seapower dominance. The ability to rapidly generate maneuver forces
    from this sea base will augment our forward presence and forcible entry
    forces, increasing the overall power and effect of the joint campaign.
    Acceleration of the lead MPF(F) from fiscal year 2008 to fiscal year
    2007 in the fiscal year 2005 budget reflects an emphasis on sea basing
    capabilities. The fiscal years 2005-2009 plan procures three MPF(F)
    ships and advanced construction for an MPF(F) aviation variant.
        High Speed Connectors
        High Speed Connectors (HSCs) possess characteristics that make them
    uniquely suited to support the sea base and sea-based operations. HSCs
    are unique in combining shallow draft, high speed, and large lift
    capacity into a single platform. HSCs will help create an enhanced
    operational capability by providing commanders with a flexible platform
    to deliver tailored, scalable forces in response to a wide range of
    mission requirements. The range and payload capacity of HSCs, combined
    with their ability to interface with current and future MPF shipping
    and access austere ports greatly enhances the operational reach,
    tactical mobility, and flexibility of sea-based forces.
        Mine Countermeasure Capabilities
        There is a great need to continue the development of our mine
    countermeasure capabilities. A major challenge for the Navy-Marine
    Corps team is ensuring the effective delivery of ground forces ashore
    when mines and other anti-access measures are employed in the surf zone
    or ashore beyond the high water mark. We are currently exploring with
    the Navy how the technology of Joint Direct Attack Munitions (JDAM)
    promises a short-term solution and may lead to a better long-term
    solution to the challenge of mines in the surf zone. Using unitary
    bombs, fuses, and JDAM tail kits, we have designed a mine
    countermeasure known as the JDAM Assault Breaching System (JABS).
    Preliminary test results are showing promise as an interim solution for
    breaching surface laid minefields and light obstacles in the beach
    zones. Further testing and characterization of the JABS system is
    proceeding throughout fiscal year 2004 with tests against Surf Zone
    Mines and obstacles.
        Some aspects of JABS development may lead to a long-term solution
    to the mine threat. One possible solution that is envisioned includes
    developing bomb-delivered darts that physically destroy buried mines in
    the Beach Zone and Surf Zone region. In addition, the Navy has adopted
    the Marine Corp Coastal Battlefield Reconnaissance and Analysis (COBRA)
    mine sensor system for the beach zone with a planned product
    improvement enhancement for COBRA called the Rapid Overt Airborne
    Reconnaissance (ROAR) that extends detection to the very shallow water
    and the surf zone regions by 2015. In addition, the Marine Corps seeks
    to improve breaching capability beyond the high water mark by
    developing both deliberate and in-stride breaching systems. These
    include the Advanced Mine Detector program and the Assault Breacher
    Vehicle program.
    Fires and Effects
        As events over the past year have demonstrated--and suggest for the
    future--the increased range and speed of expeditionary forces and the
    depth of their influence landward has and will continue to increase. To
    fully realize these capabilities the Nation requires a range of
    complementary, expeditionary lethal and non-lethal fire support
    capabilities. During OIF, 60 AV-8B Harrier aircraft were based at-sea
    aboard amphibious shipping--minimizing the challenge of airfield
    shortages ashore. This prelude to future sea-based operations was
    extremely successful with over 2,200 sorties generated--mostly in
    support of I MEF ground units. A key factor to this success was the
    employment of forward operating bases close to the ground forces which
    allowed the AV-8B to refuel and rearm multiple times before returning
    to their ships. In addition, the complementary capabilities of surface
    and air delivered fires were highlighted in this campaign. Further, the
    importance of both precision and volume fires was critical to success.
    Precision fires assisted in reducing both collateral damage and the
    demands on tactical logistics. I MEF also validated the requirement for
    volume fires in support of maneuver warfare tactics. These fires allow
    maneuver forces to take advantage of maneuver warfare opportunities
    before precision intelligence can be developed and precision fires can
    be employed against fleeting targets or rapidly developing enemy
    defensive postures.
        Short Take Off Vertical Landing Joint Strike Fighter
        The STOVL JSF will be a single engine, stealth, supersonic, strike-
    fighter capable of short take-offs and vertical landings. The aircraft
    is designed to replace the AV-8B and FA-18 aircraft in the Marine Corps
    inventory. The operational reliability, stealth, and payload capability
    designed into the STOVL JSF represents a great improvement in combat
    capability over existing legacy platforms. The aircraft is in the
    second year of a 10-12 year development program. The STOVL JSF force is
    integral to our future warfighting capabilities. Its design and
    capabilities will fulfill all Marine Corps strike-fighter requirements
    and better support the combined arms requirements in expeditionary
    operations. Continued support of the STOVL JSF is vital to the Marine
    Corps.
        Indirect Fires Support
        In response to identified gaps in our indirect fires capability,
    the Marine Corps undertook an effort to replace the aging M198 155mm
    towed howitzers and provide a full spectrum all-weather system of
    systems fires capability. Operations in Iraq confirmed this requirement
    and the direction that the Marine Corps has undertaken. This system of
    systems will be capable of employing both precision and volume
    munitions.
        The Lightweight 155mm Howitzer (LW 155) is optimized for
    versatility, pro-active counter fire and offensive operations in
    support of light and medium forces. It supports Operational Maneuver
    from the Sea and replaces all M198s in the Marine Corps, as well as the
    M198s in Army Airborne, Light Units, and Stryker Brigade Combat Teams.
    Compared to the current system, the LW 155 is more mobile, capable of
    more rapid deployment, more survivable, and more accurate. IOC is
    expected during fiscal year 2005, and a full operational capability
    will be reached 3 years later.
        The High Mobility Artillery Rocket System (HIMARS) fulfills a
    critical range and volume gap in Marine Corps fire support assets by
    providing 24 hour, all weather, ground-based, responsive, General
    Support, General Support-Reinforcing, and Reinforcing indirect fires
    throughout all phases of combat operations ashore. HIMARS will be
    fielded in one artillery battalion of the active component and one
    battalion of the Reserve component. An IOC is planned for fiscal year
    2007 with a full capability expected during fiscal year 2008. An
    interim capability of one battery during fiscal years 2005-2006 is also
    currently planned.
        The Expeditionary Fire Support System (EFSS) is the third element
    of the triad of ground firing systems, and it will be the principal
    indirect fire support system for the vertical assault element. EFSS-
    equipped units will be especially well suited for missions requiring
    speed, tactical agility, and vertical transportability. The estimated
    Approved Acquisition Objective is 88 systems. Initially, this provides
    eleven batteries to support our MEUs (Special Operations Capable). IOC
    is planned for fiscal year 2006 and full operational capability is
    planned for fiscal year 2008.
        Naval Surface Fire Support
        An important element of our fires and effects capability will
    continue to be surface ships that provide direct delivery of fires from
    the sea base. Critical deficiencies currently exist in the capability
    of the Navy to provide all-weather, accurate, lethal and responsive
    fire support throughout the depth of the littoral in support of
    expeditionary operations. In the critical period of the early phases of
    the forcible entry operations when organic Marine Corps ground indirect
    fires are not yet or just beginning to be established, the landing
    force will be even more dependent on the complementary capability
    required of naval surface fire support assets. To date, no systems have
    been introduced or are being developed which meet near- or mid-term
    Naval Surface Fire Support requirements. The DD(X) destroyer--armed
    with two 155mm Advanced Gun Systems--continues to be the best long-term
    solution to satisfy the Marine Corps' Naval Surface Fire Support
    requirements. Our Nation's forcible entry, expeditionary forces will
    remain at considerable risk for want of suitable sea-based fire support
    until DD(X) joins the fleet in considerable numbers in 2020. Currently,
    the lead ship of this class will not be operational until fiscal year
    2013. In addition, the Marine Corps is closely monitoring research into
    the development of electromagnetic gun technology to support future
    range and velocity requirements. Electromagnetic guns could potentially
    provide naval surface fire support at ranges on the order of 220
    nautical miles, and could eventually be incorporated into ground mobile
    weapon systems like the future EFVs as size, weight, and power
    technology hurdles are overcome.
        H-1 (UH-1Y/AH-1Z)
        The current fleet of UH-1N utility helicopters and AH-1W attack
    helicopters is reaching the end of their planned service life and face
    a number of deficiencies in crew and passenger survivability, payload,
    power availability, endurance, range, airspeed, maneuverability, and
    supportability. The Department of the Navy has determined that the H-1
    Upgrade Program is the most cost effective alternative that meets the
    Marine Corps' attack and utility helicopter requirements until the
    introduction of a new technology advanced rotorcraft aircraft. The H-1
    Upgrade Program is a key modernization effort designed to resolve
    existing safety deficiencies, enhance operational effectiveness of both
    the UH-1N and the AH-1W, and extend the service life of both aircraft.
    Additionally, the commonality gained between the UH-1Y and AH-1Z
    (projected to be 84 percent) will significantly reduce life-cycle costs
    and logistical footprint, while increasing the maintainability and
    deployability of both aircraft. On October 22, 2003, the program to
    enter Low-Rate Initial Production (LRIP), and on December 29, 2003, the
    LRIP Lot 1 aircraft contract was awarded to Bell Helicopter.
        Information Operations
        The Marine Corps is exploring ways to ensure marines will be
    capable of conducting full spectrum information operations, pursuing
    the development of information capabilities through initiatives in
    policy and doctrine, career force, structure, training and education,
    and programs and resources. Marine Forces will use information
    operations to deny, degrade, disrupt, destroy or influence an adversary
    commander's methods, means or ability to command and control his
    forces.
        New Weapons Technologies
        The Marine Corps is particularly interested in adapting truly
    transformational weapon technologies. We have forged partnerships
    throughout DOD, other agencies, and with industry over the past several
    years in an effort to develop and adapt the most hopeful areas of
    science and technology. Several notable programs with promising
    technologies include: (1) Advanced Tactical Lasers to potentially
    support a tactical gunship high energy laser weapon, (2) Active Denial
    System--a high-power millimeter-wave, non-lethal weapon, (3) Free
    Electron Lasers for multi-mission shipboard weapons application, and
    (4) various promising Counter Improvised Explosive Device technologies.
    Logistics and Combat Service Support
        Logistics Modernization
        Since 1999, the Marine Corps has undertaken several logistics
    modernization efforts to improve the overall effectiveness of our
    MAGTFs as agile, expeditionary forces in readiness. Some of these
    initiatives have reached full operational capability or are on track
    for complete implementation. Applying the lessons learned from OIF
    resulted in new initiatives concerning naval logistics integration,
    naval distribution, and the integration of the Combat Service Support
    Element with Marine Corps Bases.
        The Marine Corps' number one logistics priority is the re-
    engineering of logistics information technology and the retirement of
    our legacy systems, which is described in the next section. The Marine
    Corps is working to enhance the integration of its distribution
    processes across the tactical through strategic levels of warfare,
    providing the warfighter a ``snap shot'' view of his needed supplies in
    the distribution chain to instantly locate specific items that are en
    route. This capability, described in the following section, will result
    in increased confidence in the distribution chain and will reduce both
    the quantity of reorders and the amount of inventory carried to support
    the warfighter.
        Logistics Command and Control
        The Global Combat Support System-Marine Corps is the Marine Corps'
    portion of the overarching Global Combat Support System Family of
    Systems as designated by the Joint Requirements Oversight Council
    (JROC) and the Global Combat Support System General Officer Steering
    Committee. It is a Marine Corps acquisition program with the
    responsibility to acquire and integrate commercial off the shelf
    software in order to satisfy the information requirements of
    commanders, as well as support the Marine Corps Logistics Operational
    Architecture. The Global Combat Support System--Marine Corps program
    will provide modern, deployable information technology tools for all
    elements of the MAGTF. Existing Logistics Information Systems used
    today in direct support of our MAGTFs are either not deployable
    (mainframe based) or are deployable with such limited capability
    (tethered client server) that our commanders lack in-transit and asset
    visibility. Global Combat Support System-Marine Corps requirements
    include a single point of entry, Web-based portal capability to
    generate simple requests for products and services, logistics command
    and control capability to support the MAGTF, and back office tools to
    assist in the management of the logistics chain. These capabilities
    will improve warfighting excellence by providing commanders with the
    logistics information they need to make timely command and control
    decisions. The key to improving the accuracy and visibility of materiel
    in the logistics chain is to establish a shared data environment.
        End-to-End Distribution
        The Marine Corps is aggressively pursuing standardization of the
    materiel distribution within the Marine Corps to include interfacing
    with commercial and operational-level DOD distribution organizations.
    Furthermore, distribution processes and resources used in a deployed
    theater of operations need to be the same as those used in garrison. We
    strongly support United States Transportation Command's designation as
    the DOD's Distribution Process Owner. In this capacity, United States
    Transportation Command can more easily integrate distribution processes
    and systems at the strategic and operational levels and provide the DOD
    a standard, joint solution for distribution management. Materiel End-
    To-End Distribution provides Marine Corp commanders the means to
    seamlessly execute inbound and outbound movements for all classes of
    supply while maintaining Total Asset and In-transit Visibility
    throughout the distribution pipeline.
                                 vi. conclusion
        The Marine Corps remains focused on organizing, training, and
    equipping our forces to best support combatant commanders throughout
    the spectrum of combat. Incorporating recent experiences, increasing
    our forces' integration with joint capabilities, exploiting the
    flexibility and rapid response capabilities of our units, and
    preserving the adaptability of our marines, will collectively lead to
    more options for the combatant commanders. The Marine Corps' commitment
    to warfighting excellence and the steadfast support we receive from
    this committee will lead to success in the global war on terrorism
    while helping to ensure America's security and prosperity.

        Chairman Warner. We thank you for your service, General,
    and I thank you for your very clear and forthright statement,
    which again will be listened to very carefully by your forces
    and their families for your actions and judgment concerning the
    conflict in Iraq. I share your view, as we all do. WMD were not
    there readily available to be used.
        General Jumper.

    STATEMENT OF GEN. JOHN P. JUMPER, USAF, CHIEF OF STAFF, UNITED
                            STATES AIR FORCE

        General Jumper. Mr. Chairman, Senator Levin, members of the
    committee: It is a pleasure for me to be here today and to
    represent more than 700,000 active duty, Air National Guard,
    Air Force Reserve, and Air Force civilians who serve in our
    United States Air Force.
        I would like to thank this committee for their continued
    support of all that we do around the world to deal with this
    global war on terrorism and the other contingencies that we
    support globally. Senator Lieberman, I am particularly taken by
    your acknowledgment of our families that are out there, that we
    hear from every single day. I am encouraged every day at the
    courage and the bravery of those families, and I would also
    include in that the commitment of the employers who support our
    mobilized Air National Guard and Air Force Reserve members that
    have served throughout this crisis.
        I would also like to take this time, Mr. Chairman, to make
    the point that during Operation Desert Shield and Operation
    Desert Storm in 1990 and 1991 I was put in charge of preparing
    for biological and chemical warfare defense by then Chairman of
    the Joint Chiefs of Staff Colin Powell when I worked for him on
    the Joint Staff. The evidence then was compelling, and
    continued to be throughout the years of our no-fly zone
    operations, of stored chemical and biological weapons, even
    weaponizing on warheads. We did not know the disposition of
    their Scud missiles, but we knew that there were missiles left
    over after the Operation Desert Storm and Operation Desert
    Shield crisis.
        We watched for years as the Iraqis made attempts to evade
    the inspectors that were on the ground finding these weapons,
    and then we watched, as was pointed out earlier, the attempts
    to shoot at our airplanes that were patrolling the no-fly
    zones. I was, as Admiral Clark said, convinced then and I was
    convinced as we went into the war that they were there, and I
    stand by my position at that time.
        Chairman Warner. Thank you, General.
        General Jumper. Sir, as Admiral Clark pointed out, the
    group at this table spend a lot of time together, and we talk
    about our capabilities jointly and the ability to go to war
    jointly. We have decided among ourselves that we will never be
    going alone to any confrontation that this Nation undertakes.
    We have embarked on a series of joint concepts of operations so
    that we can be together when we do deploy at the Nation's
    bidding.
        As the Army undertakes its new concept of operations
    (CONOP) for a brigade combat team and as the sea basing CONOP
    unfolds, we are configuring our Air Force to be able to
    maintain the superiority in air and space and to join in on
    these concepts of operations as required to make them
    successful. We are also undertaking dedicated efforts to
    improve our close air support for the United States Army. You
    will see in this budget efforts that will assure that we have
    dedicated and improved close air support on into the future.
        We in the United States Air Force have completed our
    configuration to the Air Expeditionary Force, an effort that
    has taken us since 1994 and in a more dedicated way since 1997
    to complete this configuration into 10 equally capable
    expeditionary force packages. Today I can report to you that 75
    percent of our people in the Air Force are on tap to be
    mobilized if required.
        OIF required us to deploy 8 of our 10 Air Expeditionary
    Forces. We pulled them forward. We deployed into 32 bases and
    locations around the world. I can tell you that at the height
    of OIF I do not think we had one tent left in the United States
    Air Force. We continue today with 14 bases open throughout the
    AOR to conduct operations.
        Like the Army, the Air Force helped us with our security
    needs. They provided us with their National Guard security
    forces when we experienced increased threat conditions after
    September 11. We now have almost 100 percent of our combat
    engineers deployed to help the transition in and out between
    the United States Army and the United States Marine Corps.
        We have invested, and will continue to invest, a great deal
    in the technology of air and space. We will see continued
    development of the space-based radar (SBR), and of the
    transformational communications system. We will see the F/A-22
    in the budget as it continues to go through its operational
    testing. This is a system that will be able to deal with the
    surface-to-air missiles that we see being developed and
    deployed right now around the world, and will also be able to
    deal with anything that comes up to challenge us in the air.
        We are developing a new series of joint weapons, to include
    standoff munitions. We are developing a 250-pound small
    diameter bomb that will be able to glide with internal wings
    out many miles, allowing it to deal with targets far away. When
    we are able to incorporate this on an F/A-22 we will be able to
    support the brigade combat team concept deep behind enemy lines
    to support people on the ground.
        As for mobility, you will see that we continue to acquire
    additional C-17s, airplanes that have been renownedly
    successful. We saw in OIF the drop of over 1,000 members of the
    173rd Brigade in northern Iraq, which proved to be a very
    successful operation. Jumping with the Army were 22 airmen who
    got to the ground and made sure that the air field was able to
    be used to land aircraft as quickly as possible.
        In concert with the United States Navy, we continue to
    develop unmanned aerial vehicles (UAVs) and to put these UAVs
    out there in the hands of the people who need them: the
    Predator unmanned vehicle, the Global Hawk, and the Predator B.
    These are armed Predators: The two versions of the Predator are
    both armed and can deal with targets, as we saw them do in Iraq
    when we took out a satellite TV station being used by Baghdad
    Bob that was parked right near the Grand Mosque. We were able
    to do that with great precision, with only a very small warhead
    used from the Predator UAV.
        We continue to ask that we be able to recapitalize our
    tanker force in a way that is appropriate and is approved by
    this committee and by Members of Congress.
        We ask for continued improvement of our bomber force, to
    include standoff capability on our B-1s. We ask that we may
    develop a bomb rack from which we can drop 80 individually
    guided, Global Positioning System (GPS)-guided munitions from a
    single B-2. This has been tested and proven to be successful.
        Of course, as the other Service Chiefs have testified, none
    of this is made possible without absolutely magnificent people.
    More than 20 percent of each of our Air Expeditionary Force
    packages are made up of members of the Air National Guard and
    the Air Force Reserve. We cannot go to war without them. They
    volunteer in normal times to go on these rotations, and then we
    have innovative concepts that are working. Take, for example,
    the blended unit in Senator Chambliss' State of Georgia that
    has the Air National Guard and the Active-Duty Force in the
    same unit. In this case, it is commanded by a guardsman, but
    the command can transfer back and forth, and it provides us a
    terrific way to have ready forces that Air National Guard
    members can fall in on in times of surge. We are going to look
    at this concept also in the future with our fighter forces, to
    include the F/A-22.
        We are happy to report, as are the other Services, great
    progress and success in retention and in recruiting. Before
    this fiscal year started, we had 43 percent of this year's
    recruiting already in the bank and ready to go. Retention again
    for several years in a row now is at 100 percent in all
    categories. We expected some drop after stop-loss was dropped
    last summer. We saw no dropoff in retention. I am proud to
    report, sir, that in my travels overseas where I have visited
    with soldiers, sailors, airmen, and marines in the AOR, the
    highest morale I have ever seen and a pride that I can tell you
    I have never felt before.
        Sir, it is a pleasure to be here today and I look forward
    to your questions.
        [The prepared statement of General Jumper follows:]
                Prepared Statement by Gen. John P. Jumper, USAF
        Mr. Chairman, Senator Levin, and distinguished members of the
    committee, the Air Force has an unlimited horizon for air and space
    capabilities. Our Service was borne of innovation, and we remain
    focused on identifying and developing the concepts of operations
    (CONOPs), advanced technologies, and integrated operations required to
    provide the joint force with unprecedented capabilities and to remain
    the world's dominant air and space force.
        Throughout our distinguished history, America's Air Force has
    remained the world's premier air and space power because of our
    professional airmen, our investment in warfighting technology, and our
    ability to integrate our people and systems together to produce
    decisive effects. These Air Force competencies are the foundation that
    will ensure we are prepared for the unknown threats of an uncertain
    future. They will ensure that our combatant commanders have the tools
    they need to maintain a broad and sustained advantage over any emerging
    adversaries.
        In this strategic environment of the 21st century, and along with
    our sister Services, our Air Force will continue to fulfill our
    obligation to protect America, deter aggression, assure our allies, and
    defeat our enemies. As we adapt the Air Force to the demands of this
    era, we remain committed to fulfilling our global commitments as part
    of the joint warfighting team. In partnership, and with the continuing
    assistance of Congress, we will shape the force to meet the needs of
    this century, fight the global war on terrorism, and defend our Nation.
        The 2004 Posture Statement is our vision for the upcoming year and
    is the blueprint we will follow to sustain our air and space dominance
    in the future. We are America's Air Force--disciplined airmen, dominant
    in warfighting, decisive in conflict.
                                  introduction
        In 2003, U.S. and coalition military operations produced
    unprecedented mission successes--across the spectrum of conflict and
    around the globe. The joint warfighting team demonstrated combat
    capability never previously witnessed in the history of conflict.
    Integrating capabilities from air, land, sea, and space, the U.S. and
    coalition allies achieved considerable progress in the ongoing global
    war on terrorism. In our most recent engagements, our Armed Forces
    fulfilled our immediate obligations to defend America, deter
    aggression, assure our allies, and defeat our enemies.
        The foundation of these achievements can be found in the Department
    of Defense's (DOD) commitment to teamwork and excellence. Operation
    Iraqi Freedom (OIF) was a joint and coalition warfighting effort from
    planning to execution. Air, ground, maritime, and space forces worked
    together at the same time for the same objectives, not merely staying
    out of each other's way, but orchestrated to achieve wartime
    objectives. Our air and space forces achieved dominance throughout the
    entire theater, enabling maritime and ground forces to operate without
    fear of enemy air attack. Our airmen demonstrated the flexibility,
    speed, precision, and compelling effects of air and space power,
    successfully engaging the full range of enemy targets, from the
    regime's leadership to fielded forces. When our ground and maritime
    components engaged the enemy, they were confident our airmen would be
    there--either in advance of their attacks, or in support of their
    operations. America's Air Force was there, disciplined, dominant, and
    decisive.
        These operational accomplishments illustrate the growing maturation
    of air and space power. Leveraging the expertise of our airmen, the
    technologies present in our 21st century force, and the strategies,
    CONOPs, and organizations in use today, the U.S. Air Force continues to
    adapt to meet the demands of this new era, while pursuing the war on
    terrorism and defending the homeland.
        On September 11, 2001, the dangers of the 21st century became
    apparent to the world. Today, the U.S. faces an array of asymmetric
    threats from terrorists and rogue states, including a threat that poses
    the gravest danger to our Nation, the growing nexus of radicalism and
    technology. As we continue our work in Afghanistan and Iraq, we stand
    ready to respond to flashpoints around the world, prepared to counter
    the proliferation of weapons of mass destruction (WMD) to unfriendly
    states and non-state entities.
        We are adapting to new and enduring challenges. As we do, we are
    exploiting the inherent sources of strength that give us the advantages
    we enjoy today. It is a strategy predicated on the idea that, if we
    accurately assess our own advantages and strengths, we can invest in
    them to yield high rates of military return. This approach helps us
    create a portfolio of advantages allowing us to produce and continue to
    exploit our capabilities. Our goal is to create a capability mix
    consistent with CONOPs and effects-driven methodology, relevant to the
    joint character and increasingly asymmetric conduct of warfare.
        Since 1945, when General Henry ``Hap'' Arnold and Dr. Theodore von
    Karman published Toward New Horizons, the Air Force has evolved to meet
    the changing needs of the Nation--with the sole objective of improving
    our ability to generate overwhelming and strategically compelling
    effects from air and now, space. It is our heritage to adapt and we
    will continue to do so. During this comparatively short history, we
    became the best air and space force in the world through our focus on
    the development of professional airmen, our investment in warfighting
    technology, and our ability to integrate people and systems to produce
    decisive joint warfighting effects.
        The Air Force is making a conscious investment in education,
    training, and leader development to foster critical thinking,
    innovation, and encourage risk taking. We deliberately prepare our
    airmen--officer, enlisted, and civilian--with experience, assignments,
    and broadening that will allow them to succeed. When our airmen act in
    the combined or joint arena, whether as an Air Liaison Officer to a
    ground maneuver element, or as the space advisor to the Joint Force
    Commander (JFC), this focused professional development will guide their
    success.
        We are also investing in technologies that will enable us to create
    a fully integrated force of intelligence capabilities, manned, unmanned
    and space assets that communicate at the machine-to-machine level, and
    real-time global command and control (C2) of joint, allied, and
    coalition forces. Collectively, these assets will enable compression of
    the targeting cycle and near-instantaneous global precision-strike.
        As we cultivate new concepts of global engagement, we will move
    from analog to digital processes and adopt more agile, non-linear ways
    of integrating to achieve mission success. This change in thinking
    leads to capabilities including: networked communications; multi-
    mission platforms which fuse multi-spectral sensors; integrated global
    intelligence, surveillance, and reconnaissance (ISR); robust, all-
    weather weapons delivery with increased standoff; small smart weapons;
    remotely-piloted and unattended aircraft systems; advanced air
    operations centers; more secure position, navigation, and timing; and a
    new generation of satellites with more operationally responsive launch
    systems.
        Investment in our core competencies is the foundation of our
    preparation for future threats. They ensure we have the tools we need
    to maintain strategic deterrence as well as a sustained advantage over
    our potential adversaries. Ultimately, they ensure we can deliver the
    dominant warfighting capability our Nation needs.
        Potential adversaries, however, continue to pursue capabilities
    that threaten the dominance we enjoy today. Double-digit surface-to-air
    missile systems (SAMs) are proliferating. China has purchased
    significant numbers of these advanced SAMs, and there is a risk of
    wider future proliferation to potential threat nations. Fifth-
    generation advanced aircraft with capabilities superior to our present
    fleet of frontline fighter/attack aircraft are in production. China has
    also purchased, and is developing, advanced fighter aircraft that are
    broadly comparable to the best of our current frontline fighters.
    Advanced cruise missile technology is expanding, and information
    technology is spreading. Access to satellite communications, imagery,
    and use of the Global Positioning System (GPS) signal for navigation
    are now available for anyone willing to purchase the necessary
    equipment or services. With this relentless technological progress and
    the potential parity of foreign nations, as well as their potential
    application in future threats, the mere maintenance of our aging
    aircraft and space systems will not suffice. Simply stated, our current
    fleet of legacy systems cannot always ensure air and space dominance in
    future engagements.
        To counter these trends, we are pursuing a range of strategies that
    will guide our modernization and recapitalization efforts. We are using
    a capabilities-based planning and budgeting process, an integrated and
    systematic risk assessment system, a commitment to shorter acquisition
    cycle times, and improved program oversight. Our goal is to integrate
    our combat, information warfare, and support systems to create a
    portfolio of air and space advantages for the joint warfighter and the
    Nation. Thus, we continue to advocate for program stability in our
    modernization and investment accounts.
        The principal mechanisms that facilitate this process are our Air
    Force CONOPs. Through the CONOPs, we analyze problems we will be asked
    to solve for the JFCs, identify the capabilities our expeditionary
    forces need to accomplish their missions, and define the operational
    effects we expect to produce. Through this approach, we can make
    smarter decisions about future investment, articulate the link between
    systems and employment concepts, and identify our capability gaps and
    risks.
        The priorities that emerge from the CONOPs will guide a reformed
    acquisition process that includes more active, continuous, and creative
    partnerships among the requirement, development, operational test, and
    industry communities who work side-by-side at the program level. In our
    science and technology (S&T) planning, we are also working to
    demonstrate and integrate promising technologies quickly by providing
    an operational ``pull'' that conveys a clear vision of the capabilities
    we need for the future.
        We are applying this approach to our space systems as well. As the
    DOD's executive agent for space, we are producing innovative solutions
    for the most challenging national security problems. We have defined a
    series of priorities essential to delivering space-based capabilities
    to the joint warfighter and the Intelligence Community. Achieving
    mission success--in operations and acquisition--is our principal
    priority. This requires us to concentrate on designing and building
    quality into our systems. To achieve these exacting standards, we will
    concentrate on the technical aspects of our space programs early on--
    relying on strong systems engineering design, discipline, and robust
    test programs. We also have many areas that require a sustained
    investment. We need to replace aging satellites, improve outmoded
    ground control stations, achieve space control capabilities to ensure
    freedom of action, sustain operationally responsive assured access to
    space, address bandwidth limitations, and focus space S&T investment
    programs. This effort will require reinvigorating the space industrial
    base and funding smaller technology incubators to generate creative
    ``over the horizon'' ideas.
        As we address the problem of aging systems through renewed
    investment, we will continue to find innovative means to keep current
    systems operationally effective. In OIF, the spirit of innovation
    flourished. We achieved a number of air and space power firsts:
    employment of the B-1 bomber's synthetic aperture radar and ground
    moving target indicator for ISR; incorporation of the Litening II
    targeting pod on the F-15, F-16, A-10, and the B-52; and use of a
    Global Hawk for strike coordination and reconnaissance while flown as a
    remotely piloted aircraft. With these integrated air and space
    capabilities, we were able to precisely find, fix, track, target, and
    rapidly engage our adversaries. These examples illustrate how we are
    approaching adaptation in the U.S. Air Force.
        Ultimately, the success of our Air Force in accomplishing our
    mission and adapting to the exigencies of combat stems from the more
    than 700,000 active, Guard, Reserve, and civilian professionals who
    proudly call themselves ``airmen.'' In the past 5 years, they have
    displayed their competence and bravery in three major conflicts: the
    Balkans, Afghanistan, and Iraq. They are a formidable warfighting
    force, imbued with an expeditionary culture, and ready for the
    challenges of a dangerous world.
        Poised to defend America's interests, we continue to satisfy an
    unprecedented demand for air and space warfighting capabilities--
    projecting American power globally while providing effective homeland
    defense. This is the U.S. Air Force in 2004--we foster ingenuity in the
    world's most professional airmen, thrive on transitioning new
    technologies into joint warfighting systems, and drive relentlessly
    toward integration to realize the potential of our air and space
    capabilities. We are America's airmen--confident in our capability to
    provide our Nation with dominance in air and space.
                  air and space dominance in a new environment
        The U.S. Air Force ensures a flexible, responsive, and dominant
    force by providing a spectrum of operational capabilities that
    integrate with joint and coalition forces. To sustain and improve upon
    the dominance we enjoy today, the Air Force will remain engaged with
    the other Services, our coalition partners, interagency teams, and the
    aerospace industry. As we do, we will incorporate the lessons learned
    from rigorous evaluation of past operations, detailed analyses of
    ongoing combat operations, and thoughtful prediction of the
    capabilities required of a future force.
        The pace of operations over the past year enabled us to validate
    the function and structure of our Air and Space Expeditionary Forces
    (AEFs). Operations in 2003 demanded more capability from our AEFs than
    at any time since their inception in 1998. However, for the first time
    we relied exclusively on our AEFs to present the full range of our
    capabilities to the combatant commanders. Through our 10 AEFs, our AEF
    prime capabilities (space, national ISR, long range strike, nuclear,
    and other assets), and our AEF mobility assets, we demonstrated our
    ability to package forces, selecting the most appropriate combat ready
    forces from our Total Force, built and presented expeditionary units,
    and flowed them to the theaters of operation in a timely and logical
    sequence. We rapidly delivered them to the warfighters, while
    preserving a highly capable residual force to satisfy our global
    commitments.
        More than three-fourths of our 359,300 active duty airmen are
    eligible to deploy and are assigned to an AEF. Through much of the past
    year, Total Force capabilities from 8 of the 10 AEFs were engaged
    simultaneously in worldwide operations. The remaining elements were
    returning from operations, training, or preparing to relieve those
    currently engaged. By the end of 2003, more than 26,000 airmen were
    deployed, supporting operations around the world.
        In 2004, we will continue to use the AEFs to meet our global
    requirements while concurrently reconstituting the force. Our number
    one reconstitution priority is returning our forces to a sustainable
    AEF battle rhythm while conducting combat operations. Attaining this
    goal is about revitalizing capabilities. For most airmen, that will
    include a renewed emphasis on joint composite force training and
    preparation for rotations in the AEF. Through the AEF, the Air Force
    presents right-sized, highly trained expeditionary units to JFCs for
    employment across the spectrum of conflict.
    Global War on Terrorism
        The year 2003 marked another historic milestone for the U.S. and
    the Air Force in the global war on terrorism. Since September 11, 2001,
    air and space power has proven indispensable to securing American
    skies, defeating the Taliban, denying sanctuary to al Qaeda and other
    terrorist organizations, and most recently, removing a brutal and
    oppressive dictator in Iraq. This global war on terrorism imposes on
    airmen a new steady state of accelerated operations and personnel tempo
    (PERSTEMPO), as well as a demand for unprecedented speed, agility, and
    innovation in defeating unconventional and unexpected threats, all
    while bringing stability and freedom to Afghanistan and Iraq. The Air
    Force and its airmen will meet these demands.
    Operation Noble Eagle
        High above our Nation, airmen protect our skies and cities through
    air defense operations known as Operation Noble Eagle (ONE). The Total
    Force team, comprised of active duty, Air National Guard, and Air Force
    Reserve airmen, conducts airborne early warning, air refueling, and
    combat air patrol operations in order to protect sensitive sites,
    metropolitan areas, and critical infrastructure.
        This constant ``top cover'' demands significant Air Force assets,
    thus raising the baseline of requirements above the pre-September 11
    tempo. Since 2001, this baseline has meant over 34,000 fighter, tanker,
    and airborne early warning sorties were added to Air Force
    requirements.
        This year the Air Force scrambled nearly 1,000 aircraft, responding
    to 800 incidents. Eight active duty, 8 Air Force Reserve, and 18 Air
    National Guard units provided 1,300 tanker sorties offloading more than
    32 million pounds of fuel for these missions. Last year, over 2,400
    airmen stood vigilant at air defense sector operations centers and
    other radar sites. Additionally, in 2003, we continued to
    institutionalize changes to our homeland defense mission through joint,
    combined, and interagency training and planning. Participating in the
    initial validation exercise Determined Promise-03, the Air Force
    illustrated how its air defense, air mobility, and command and control
    capabilities work seamlessly with other agencies supporting U.S.
    Northern Command (NORTHCOM) and Department of Homeland Security (DHS)
    objectives. The integration and readiness that comes from careful
    planning and rigorous training will ensure the continued security of
    America's skies.
    Operation Enduring Freedom--Afghanistan
        Operation Enduring Freedom--Afghanistan (OEF) is ongoing. Remnants
    of Taliban forces continue to attack U.S., North Atlantic Treaty
    Organization (NATO), coalition troops, humanitarian aid workers, and
    others involved in the reconstruction of Afghanistan. To defeat this
    threat, aid coalition stability, and support operations, the Air Force
    has maintained a presence of nearly 24,000 airmen in and around the
    region. Having already flown more than 90,000 sorties (over 72 percent
    of all OEF missions flown), the Air Force team of active, Guard, and
    Reserve airmen continue to perform ISR, close air support (CAS), aerial
    refueling, and tactical and strategic airlift.
        While fully engaged in ONE and OIF, the men and women of the Air
    Force provided full spectrum air and space support, orchestrating
    assets from every Service and 10 different nations. Of these, Air Force
    strike aircraft flying from nine bases flew more than two-thirds of the
    combat missions, dropped more than 66,000 munitions (9,650 tons) and
    damaged or destroyed approximately three-quarters of planned targets.
    In 2003 alone, Air Force assets provided more than 3,000 sorties of on-
    call CAS, responding to calls from joint and/or coalition forces on the
    ground.
        Last year, the Air Force brought personnel and materiel into this
    distant, land-locked nation via 7,410 sorties. Over 4,100 passengers
    and 487 tons of cargo were moved by airmen operating at various Tanker
    Airlift Control Elements in and around Afghanistan. To support these
    airlift and combat sorties and the numerous air assets of the coalition
    with aerial refueling, the Air Force deployed over 50 tankers. In their
    primary role, these late 1950s-era and early 1960s-era KC-135 tankers
    flew more than 3,900 refueling missions. In their secondary airlift
    role, they delivered 3,620 passengers and 405 tons of cargo. Without
    versatile tankers, our Armed Forces would need greater access to
    foreign bases, more aircraft to accomplish the same mission, more
    airlift assets, and generate more sorties to maintain the required
    duration on-station.
        Operations in Afghanistan also highlight U.S. and coalition
    reliance on U.S. space capabilities. This spanned accurate global
    weather, precise navigation, communications, as well as persistent
    worldwide missile warning and surveillance. For example, OEF relied on
    precision navigation provided by the Air Force's GPS constellation,
    over-the-horizon satellite communications (SATCOM), and timely
    observations of weather, geodesy, and enemy activity. To accomplish
    this, space professionals performed thousands of precise satellite
    contacts and hundreds of station keeping adjustments to provide
    transparent space capability to the warfighter. These vital space
    capabilities and joint enablers directly leveraged our ability to
    pursue U.S. objectives in OEF.
    Operations Northern Watch and Southern Watch
        During the past 12 years, the Air Force flew over 391,000 sorties
    enforcing the northern and southern no-fly zones over Iraq. With the
    preponderance of forces, the Air Force, along with the Navy and Marine
    Corps, worked alongside the Royal Air Force in Operations Northern
    Watch (ONW) and Southern Watch (OSW). Manning radar outposts and
    established C2 centers, conducting ISR along Iraq's borders, responding
    to almost daily acts of Iraqi aggression, and maintaining the required
    airlift and air refueling missions taxed Air Force assets since the end
    of Operation Desert Storm. Yet, these successful air operations had
    three main effects: they halted air attacks on the ethnic minority
    populations under the no-fly zones; they deterred a repeat of Iraqi
    aggression against its neighbors; and they leveraged enforcement of
    United Nations (U.N.) Security Council Resolutions. Throughout this
    period, our airmen honed their warfighting skills, gained familiarity
    with the region, and were able to establish favorable conditions for
    OIF. For more than a decade, American airmen rose to one of our
    Nation's most important challenges, containing Saddam Hussein.
    Operation Iraqi Freedom
        On March 19, 2003, our airmen, alongside fellow soldiers, sailors,
    marines, and coalition teammates, were called upon to remove the
    dangerous and oppressive Iraqi regime--this date marked the end of ONW/
    OSW and the beginning of OIF. OIF crystallized the meaning of jointness
    and the synergies of combined arms and persistent battlefield
    awareness.
        In the first minutes of OIF, airmen of our Combat Air Forces (USAF,
    USN, USMC, and coalition) were flying over Baghdad. As major land
    forces crossed the line of departure, Air Force assets pounded Iraqi
    C\2\ facilities and key leadership targets, decapitating the
    decisionmakers from their fielded forces. Remaining Iraqi leaders
    operated with outdated information about ground forces that had already
    moved miles beyond their reach. As the land component raced toward
    Baghdad, coalition strike aircraft were simultaneously attacking Iraqi
    fielded forces, communications and command and control centers,
    surface-to-surface missile launch sites, and were supporting Special
    Operations Forces, and ensuring complete air and space dominance in the
    skies over Iraq. Due to these actions and those during the previous 12
    years, none of the 19 Iraqi missile launches were successful in
    disrupting coalition operations, and not a single Iraqi combat sortie
    flew during this conflict. Twenty-one days after major combat
    operations began, the first U.S. land forces reached Baghdad. Five days
    later, the last major city in Iraq capitulated.
        The Air Force provided over 7,000 CAS sorties to aid land forces in
    the quickest ground force movement in history. Lieutenant General
    William S. Wallace, Commander of the U.S. Army V Corps said, ``none of
    my commanders complained about the availability, responsiveness, or
    effectiveness of CAS--it was unprecedented!'' As Iraqi forces attempted
    to stand against the integrated air and ground offensive, they found a
    joint and coalition team that was better equipped, better trained, and
    better led than ever brought to the field of battle.
        Training, leadership, and innovation coupled with the Air Force's
    recent investment in air mobility allowed U.S. forces to open a second
    major front in the Iraqi campaign. Constrained from access by land, Air
    Force C-17s airdropped over 1,000 paratroopers from the 173rd Airborne
    Brigade into northern Iraq. This successful mission opened Bashur
    airfield and ensured U.S. forces could be resupplied.
        Before 2003, the Air Force invested heavily in the lessons learned
    from OEF. Shortening the ``kill chain,'' or the time it took to find,
    fix, track, target, engage, and assess was one of our top priorities.
    This investment was worthwhile, as 156 time-sensitive targets were
    engaged within minutes, most with precision weapons. The flexibility of
    centralized control and decentralized execution of air and space power
    enabled direct support to JFC objectives throughout Iraq. Coalition and
    joint airpower shaped the battlefield ahead of ground forces, provided
    intelligence and security to the flanks and rear of the rapidly
    advancing coalition, and served as a force multiplier for Special
    Operations Forces (SOF). This synergy between SOF and the Air Force
    allowed small specialized teams to have a major effect throughout the
    northern and western portions of Iraq by magnifying their inherent
    lethality, guaranteeing rapid tactical mobility, reducing their
    footprint through aerial resupply, and providing them the advantage of
    ``knowing what was over the next hill'' through air and space-borne
    ISR.
        The Air Force's C\2\ISR assets enabled the joint force in
    Afghanistan as well. This invaluable fleet includes the RC-135 Rivet
    Joint, E-8 JSTARS, and the E-3 Airborne Warning and Control System
    (AWACS). This ``Iron Triad'' of intelligence sensors and C\2\
    capabilities illustrates the Air Force vision of horizontal integration
    in terms of persistent battlefield awareness. Combined with the Global
    Hawk unmanned aerial vehicle (UAV) and Predator remotely piloted
    aircraft, spaced-based systems, U-2, and Compass Call, these invaluable
    system provided all-weather, multi-source intelligence to commanders
    from all services throughout the area of responsibility.
        OIF was the Predator's first ``networked'' operation. Four
    simultaneous Predator orbits were flown over Iraq and an additional
    orbit operated over Afghanistan, with three of those orbits controlled
    via remote operations in the U.S. This combined reachback enabled
    dynamic support to numerous OIF missions. Predator also contributed to
    our operational flexibility, accomplishing hunter-killer missions,
    tactical ballistic missile search, force protection, focused
    intelligence collection, air strike control, and special operations
    support. A Hellfire equipped Predator also conducted numerous precision
    strikes against Iraqi targets, and flew armed escort missions with U.S.
    Army helicopters.
        Space power provided precise, all-weather navigation, global
    communications, missile warning, and surveillance. The ability to adapt
    to adverse weather conditions, including sandstorms, allowed air, land,
    and maritime forces to confound the Iraqi military and denied safe
    haven anywhere in their own country. As the Iraqis attempted to use
    ground-based GPS jammers, Air Force strike assets destroyed them, in
    some cases, using the very munitions the jammers attempted to defeat.
    As Defense Secretary Donald Rumsfeld noted, this new era was
    illustrated by the coalition's ``unprecedented combination of power,
    precision, speed, and flexibility.''
        During the height of OIF, the Air Force deployed 54,955 airmen.
    Ambassador Paul Bremer, Chief of the Coalition Provisional Authority
    (CPA), pronounced, ``In roughly 3 weeks [we] liberated a country larger
    than Germany and Italy combined, and [we] did so with forces smaller
    than the Army of the Potomac.'' Led by the finest officers and non-
    commissioned officers, our airmen flew more than 79,000 sorties since
    March 2003. Ten thousand strike sorties dropped 37,065 munitions. The
    coalition flew over 55,000 airlift sorties moved 469,093 passengers and
    more than 165,060 tons of cargo. In addition, over 10,000 aerial
    refueling missions supported aircraft from all services, and 1,600 ISR
    missions provided battlespace awareness regardless of uniform, Service,
    or coalition nationality. This was a blistering campaign that demanded
    a joint and combined effort to maximize effects in the battlespace.
        Today, Air Force airmen continue to contribute to the joint and
    coalition team engaged in Iraq. At the end of the year, 6,723 airmen
    from the active duty, Reserve, and Air National Guard conducted a wide
    range of missions from locations overseas, flying approximately 150
    sorties per day including CAS for ground forces tracking down regime
    loyalists, foreign fighters, and terrorists. On a daily basis, U-2 and
    RC-135 aircraft flew ISR sorties monitoring the porous borders of Iraq
    and providing situational awareness and route planning for Army patrols
    in stability and support operations. Providing everything from base
    security for 27 new bases opened by the coalition to the lifeline of
    supplies that air mobility and air refueling assets bring to all joint
    forces, Air Force airmen are committed to the successful accomplishment
    of the U.S. mission in Iraq.
    Other Contingency Operations
        In 2003, the Air Force remained engaged in America's war on drugs
    and provided support to NATO ground forces in the Balkans. Since
    December 1989, Air Force airmen have been an irreplaceable part of the
    interagency fight against illegal drug and narcotics trafficking.
    Deployed along the southern U.S., in the Caribbean, and Central and
    South America, airmen perform this round-the-clock mission, manning
    nine ground-based radar sites, operating 10 aerostats, and flying
    counter drug surveillance missions. The Air Force detected, monitored,
    and provided intercepts on over 275 targets attempting to infiltrate
    our airspace without clearance. Along with our interagency partners,
    these operations resulted in 221 arrests and stopped hundreds of tons
    of contraband from being smuggled into our country.
        In the Balkans, airmen are fully committed to completing the
    mission that they started in the 1990s. Today, Air Force airmen have
    flown over 26,000 sorties supporting Operations Joint Guardian and
    Joint Forge. These NATO-led operations combine joint and allied forces
    to implement the Dayton Peace Accords in Bosnia-Herzegovina and enforce
    the Military Technical Agreement in Kosovo. At the end of 2003,
    approximately 800 airmen were supporting NATO's goal of achieving a
    secure environment and promoting stability in the region.
        Additionally, the Air Force engaged in deterrence and humanitarian
    relief in other regions. While the world's attention was focused on the
    Middle East in the spring of 2003, our Nation remained vigilant against
    potential adversaries in Asia. The Air Force deployed a bomber wing--24
    B-52s and B-1s--to the American territory of Guam to deter North Korea.
    At the height of OIF, our Air Force demonstrated our country's resolve
    and ability to defend the Republic of Korea and Japan by surging bomber
    operations to over 100 sorties in less than 3 days. This deterrent
    operation complemented our permanent engagement in Northeast Asia. The
    8,300 airmen who are stationed alongside the soldiers, sailors,
    marines, and our Korean allies maintained the U.N. armistice, marking
    50 years of peace on the peninsula.
        Our strength in deterring aggression was matched by our strength in
    humanitarian action. In response to President Bush's directive to help
    stop the worsening crisis in Liberia, we deployed a non-combat medical
    and logistics force to create a lifeline to the American Embassy and
    provide hope to the Liberian people. An AEF of airmen provided airlift
    support, aeromedical evacuation, force protection, and theater of
    communications support. Flying more than 200 sorties, we transported
    and evacuated civilians and members of the Joint Task Force (JTF) from
    bases in Sierra Leone and Senegal. The 300 airmen deployed in support
    of JTF-Liberia reopened the main airport in Monrovia, and ensured the
    security for U.S. military and civilian aircraft providing relief aid.
    Strategic Deterrence
        The ability of U.S. conventional forces to operate and project
    decisive force is built on the foundation of our strategic deterrent
    force; one that consists of our nuclear-capable aircraft and
    intercontinental ballistic missile (ICBM) forces, working with the U.S.
    Navy's Fleet Ballistic Missile Submarines. In 2003, these forces as
    well as, persistent overhead missile warning sensors and supporting
    ground-based radars, provided uninterrupted global vigilance deterring
    a nuclear missile strike against the U.S. or our allies. The dedicated
    airmen who operate these systems provide the force capability that
    yields our deterrent umbrella. Should that deterrence fail, they stand
    ready to provide a prompt, scalable response.
    Exercises
        The Air Force's success can be attributed to the training,
    education, and equipment of our airmen. Future readiness of our
    operations, maintenance, mission support, and medical units will depend
    on rigorous and innovative joint and coalition training and exercising.
    This year we are planning 140 exercises with other Services and
    agencies and we anticipate being involved with 103 allied nations. We
    will conduct these exercises in as many as 45 foreign countries.
    Participation ranges from the joint/combined command post exercise
    Ulchi Focus Lens with our South Korean partners to the tailored
    international participation in our FLAG exercises and Mission
    Employment Phases of USAF Weapons School. From joint search-and-rescue
    forces in Arctic Sarex to Partnership for Peace (PFP) initiatives, our
    airmen must continue to take advantage of all opportunities that help
    us train the way we intend to fight.
        In addition to previously designed exercises, recent operations
    highlighted the need for combat support training. During OEF and OIF,
    the Air Force opened or improved 38 bases used by joint or coalition
    forces during combat. Our Expeditionary Combat Support teams
    established secure, operable airfields in Kyrgyzstan, Uzbekistan,
    Pakistan, and in Iraq. They also built housing, established
    communications, and erected dining facilities that are still used by
    other Services and follow-on forces today. To prepare our airmen for
    these missions, we have created Eagle Flag, an Expeditionary Combat
    Support Field Training Exercise. During this exercise, combat support
    personnel apply the integrated skills needed to organize and create an
    operating location ready to receive fully mission capable forces within
    72 hours. From security forces and civil engineers to air traffic
    controllers and logisticians, each airman required to open a new base
    or improve an austere location will eventually participate in this
    valuable exercise.
        Our ranges and air space are critical joint enablers and vital
    national assets that allow the Air Force to develop and test new
    weapons, train forces, and conduct joint exercises. The ability of the
    Air Force to effectively operate requires a finite set of natural and
    fabricated resources. Encroachment of surrounding communities onto Air
    Force resources results in our limited or denied access to, or use of,
    these resources. We have made it a priority to define and quantify the
    resources needed to support mission requirements, and to measure and
    communicate the effects of encroachment on our installations, radio
    frequency spectrum, ranges, and air space. We will continue to work
    with outside agencies and the public to address these issues. The Air
    Force strongly endorses the Readiness Range and Preservation
    Initiative. It would make focused legislative changes, protecting the
    Air Force's operational resources while continuing to preserve our
    Nation's environment.
    Lessons for the Future
        As we continue combat operations and prepare for an uncertain
    future, we are examining lessons from our recent experiences. Although
    we are currently engaged with each of the other Services to refine the
    lessons from OIF, many of the priorities listed in the fiscal year 2005
    Presidential budget submission reflect our preliminary conclusions. The
    Air Force has established a team committed to turning validated lessons
    into new equipment, new operating concepts, and possibly new
    organizational structures. Working closely with our joint and coalition
    partners, we intend to continue our momentum toward an even more
    effective fighting force.
        One of the most important lessons we can draw was envisioned by the
    authors of the Goldwater-Nichols Act. ONE, OEF, and OIF all validated
    jointness as the only acceptable method of fighting and winning this
    Nation's wars. In OIF, the mature relationship between the Combined
    Forces Land Component Commander (CFLCC) and the Combined Forces Air
    Component Commander (CFACC) led to unprecedented synergies. The CFACC
    capitalized on these opportunities by establishing coordination
    entities led by an Air Force general officer in the supported land
    component headquarters and by maintaining internal Army, Navy, Marine
    Corps, and coalition officers in his own headquarters. Both of these
    organizational innovations enabled commanders to maximize the
    advantages of mass, lethality, and flexibility of airpower in the area
    of responsibility.
        Another lesson is the Air Force's dependence on the Total Force
    concept. As stated above, September 11 brought with it a new tempo of
    operations, one that required both the active duty and Air Reserve
    component (ARC) to work in concert to achieve our national security
    objectives. The synergy of our fully integrated active duty, Air
    National Guard, and Air Force Reserve team provides warfighters with
    capabilities that these components could not provide alone.
        Our Reserve component accounts for over one-third of our strike
    fighters, more than 72 percent of our tactical airlift, 42 percent of
    our strategic airlift, and 52 percent of our air refueling capability.
    The ARC also makes significant contributions to our rescue and support
    missions, and has an increasing presence in space, intelligence, and
    information operations. In all, the ARC provides a ready force
    requiring minimum preparation for mobilization. Whether that
    mobilization is supporting flight or alert missions for ONE, commanding
    expeditionary wings in combat, or orchestrating the Air Force Special
    Operations roles in the western Iraqi desert, the ARC will remain
    critical to achieving the full potential of our air and space power.
        A third lesson was validation of the need for air and space
    superiority. Through recent combat operations, the Air Force maintained
    its almost 50-year-old record of ``no U.S. ground troops killed by
    enemy air attack.'' Without having to defend against Iraqi airpower,
    coalition commanders could focus their combat power more effectively.
    In addition, air and space superiority allowed airmen to dedicate more
    sorties in support of the ground scheme of maneuver, substantially
    reducing enemy capability in advance of the land component.
        We also need to continue to advance integration and planning--
    integration of Service capabilities to achieve JFC objectives,
    interagency integration to fight the war on terrorism, and information
    integration. Integration of manned, unmanned, and space sensors,
    advanced command and control, and the ability to disseminate and act on
    this information in near-real time will drive our combat effectiveness
    in the future. Shared through interoperable machine-to-machine
    interfaces, this data can paint a picture of the battlespace where the
    sum of the wisdom of all sensors will end up with a cursor over the
    target for the operator who can save the target, study the target, or
    destroy the target.
        Finally, there are three general areas for improvement we consider
    imperative: battle damage assessment, fratricide prevention/combat
    identification, and equipping our battlefield airmen. First, battle
    damage assessment shapes the commander's ability for efficient
    employment of military power. Restriking targets that have already been
    destroyed, damaged, or made irrelevant by rapid ground force advances
    wastes sorties that could be devoted to other coalition and joint force
    objectives. Advances in delivery capabilities of our modern fighter/
    attack aircraft and bombers mean that ISR assets must assess more
    targets per strike than ever before. Precision engagement requires
    precision location, identification, and precision assessment. Although
    assets like the Global Hawk, Predator, U-2, Senior Scout, and Rivet
    Joint are equipped with the latest collection technology, the Air
    Force, joint team, and Intelligence Community must work to ensure that
    combat assessments produce timely, accurate, and relevant products for
    the warfighters.
        We are also improving operational procedures and technology to
    minimize incidents of fratricide or ``friendly fire.'' In OIF, major
    steps toward this goal resulted from technological solutions. Blue
    Force Tracker and other combat identification systems on many ground
    force vehicles allowed commanders situational awareness of their forces
    and enemy forces via a common operational picture. Still, not all joint
    or coalition forces are equipped with these technological advances. We
    are pursuing Fire Support Coordination Measures that capitalize on the
    speed and situational awareness digital communications offer rather
    than analog voice communications and grease pencils.
        A third area we are actively improving is the effectiveness of the
    airmen who are embedded with conventional land forces or SOF. With
    assured access to Air Force datalinks and satellites, these
    ``Battlefield Airmen'' can put data directly into air-land-sea weapon
    systems and enable joint force command and control. We have made great
    progress in producing a Battlefield Air Operations Kit that is 70
    percent lighter, with leading-edge power sources; one that will
    increase the combat capability of our controllers. This battle
    management system will reduce engagement times, increase lethality and
    accuracy, and reduce the risk of fratricide. This capability is based
    upon the good ideas of our airmen who have been in combat and
    understand how much a single individual on the battlefield can
    contribute with the right kit.
    Summary
        The airmen of America's Air Force have demonstrated their expertise
    and the value of their contributions to the joint and coalition fight.
    These combat operations are made possible by Air Force investments in
    realistic training and education, superior organization, advanced
    technology, and innovative tactics, techniques, and procedures. In the
    future, our professional airmen will continue to focus advances in
    these and other areas guided by the Air Force CONOPs. Their charter is
    to determine the appropriate capabilities required for joint
    warfighting and to provide maximum effects from, through, and in air
    and space. This structure and associated capabilities-based planning
    will help airmen on their transformational journey, ensuring continued
    operational successes such as those demonstrated in 2003.
               ensuring america's future air and space dominance
        Air Force lethality, mobility, speed, precision, and the ability to
    project U.S. military power around the globe provide combatant
    commanders the capabilities required to meet the Nation's military
    requirements and dominate our enemies. Consistent with the DOD's focus
    on Joint Operating Concepts, we will continue to transform our force--
    meeting the challenges of this era, adapting our forces and people to
    them, and operating our service efficiently. We will adopt service
    concepts and capabilities that support the joint construct and
    capitalize on our core competencies. To sustain our dominance, we
    develop professional airmen, invest in warfighting technology, and
    integrate our people and systems together to produce decisive joint
    warfighting capabilities.
            developing airmen--right people, right place, right time
        At the heart of our combat capability are the professional airmen
    who voluntarily serve the Air Force and our Nation. Our airmen turn
    ideas, tools, tactics, techniques, and procedures into global mobility,
    power projection, and battlespace effects. Our focus for the ongoing
    management and development of Air Force personnel will be to: define,
    renew, develop, and sustain the force.
    Defining our Requirements
        To meet current and future requirements, we need the right people
    in the right specialties. The post-September 11 environment has taxed
    our equipment and our people, particularly those associated with force
    protection, ISR, and the buildup and sustainment of expeditionary
    operations. Our analysis shows that we need to shift manpower to
    stressed career fields to meet the demands of this new steady state,
    and we are in the process of doing this. We have realigned personnel
    into our most stressed specialties and hired additional civilians and
    contractors to free military members to focus on military specific
    duties. We have also made multi-million dollar investments in
    technology to reduce certain manpower requirements. We have redirected
    our training and accession systems and have cross-trained personnel
    from specialties where we are over strength to alleviate stressed
    career fields, supporting the Secretary of Defense's vision of moving
    forces ``from the bureaucracy to the battlefield.''
        Since 2001, we have exceeded our congressionally mandated end
    strength by more than 16,000 personnel. In light of the global war on
    terrorism and OIF, DOD allowed this overage, but now we need to get
    back to our mandated end strength. We are addressing this issue in two
    ways: first, by reducing personnel overages in most skills; and second,
    by shaping the remaining force to meet mission requirements. To reduce
    personnel, we will employ a number of voluntary tools to restructure
    manning levels in Air Force specialties, while adjusting our Active
    Force size to the end strength requirement. As we progress, we will
    evaluate the need to implement additional force shaping steps.
        We are also reviewing our ARC manpower to minimize involuntary
    mobilization of ARC forces for day-to-day, steady state operations
    while ensuring they are prepared to respond in times of crisis. Since
    September 11, 2001, we have mobilized more than 62,000 people in over
    100 units, and many more individual mobilization augmentees. Today, 20
    percent of our AEF packages are comprised of citizen airmen, and
    members of the Guard or Reserve conduct 89 percent of ONE missions. We
    recognize this is a challenge and are taking steps to relieve the
    pressure on the Guard and Reserve.
        In fiscal year 2005, we plan to redistribute forces in a number of
    mission areas among the Reserve and active components to balance the
    burden on the Reserves. These missions include our Air and Space
    Operations Centers, remotely piloted aircraft systems, Combat Search
    and Rescue, Security Forces, and a number of high demand global
    mobility systems. We are working to increase ARC volunteerism by
    addressing equity of benefits and tour-length flexibility, while
    addressing civilian employer issues. We are also looking at creating
    more full-time positions to reduce our dependency on involuntary
    mobilization.
        We are entering the second year of our agreement to employ Army
    National Guard soldiers for force protection at Air Force
    installations, temporarily mitigating our 8,000 personnel shortfall in
    security forces. As we do this, we are executing an aggressive plan to
    rapidly burn down the need for Army augmentation and working to
    redesign manpower requirements. Our reduction plan maximizes the use of
    Army volunteers in the second year, and allows for demobilization of
    about one third of the soldiers employed in the first year.
    Future Total Force
        Just as in combat overseas, we are continuing to pursue seamless
    ARC and active duty integration at home, leveraging the capabilities
    and characteristics of each component, while allowing each to retain
    their cultural identity. We continue to explore a variety of
    organizational initiatives to integrate our Active, Guard, and Reserve
    Forces. These efforts are intended to expand mission flexibility,
    create efficiencies in our Total Force, and prepare for the future.
    Today's Future Total Force team includes a number of blended or
    associate units that are programmed or are in use. The creation of the
    ``blended'' unit, the 116th Air Control Wing at Robins Air Force Base,
    Georgia, elevated integration to the next level. With an initial
    deployment of over 730 personnel, and significant operational
    achievements in OIF, we are now examining opportunities to integrate
    active, Guard, and Reserve units elsewhere in order to produce even
    more measurable benefits, savings, and efficiencies.
        The reasons for this type of integration are compelling. We can
    maximize our warfighting capabilities by integrating Active, Guard, and
    Reserve Forces to optimize the contributions of each component.
    Reservists and guardsmen bring with them capabilities they have
    acquired in civilian jobs, leveraging the experience of ARC personnel.
    Integration relieves PERSTEMPO on the Active-Duty Force. Because ARC
    members do not move as often, they provide corporate knowledge,
    stability, and continuity. Finally, integration enhances the retention
    of airmen who decide to leave active service. Because the Guard and
    Reserve are involved in many Air Force missions, we recapture the
    investment we've made by retaining separating active duty members as
    members of the ARC.
    Renewing the Force
        To renew our force, we target our recruitment to ensure a diverse
    force with the talent and drive to be the best airmen in the world's
    greatest Air Force. We will recruit those with the skills most critical
    for our continued success. In fiscal year 2003, our goal was 5,226
    officers and 37,000 enlisted; we exceeded our goal in both categories,
    accessing 5,419 officers and 37,144 enlisted. For fiscal year 2004, we
    plan to access 5,795 officers and 37,000 enlisted.
        In the Air Force, the capabilities we derive from diversity are
    vital to mission excellence and at the core of our strategy to maximize
    our combat capabilities. In this new era, successful military
    operations demand much greater agility, adaptability, and versatility
    to achieve and sustain success. This requires a force comprised of the
    best our Nation has to offer, from every segment of society, trained
    and ready to go. Our focus is building a force that consists of men and
    women who possess keener international insight, foreign language
    proficiency, and wide-ranging cultural acumen. Diversity of life
    experiences, education, culture, and background are essential to help
    us achieve the asymmetric advantage we need to defend America's
    interests wherever threatened. Our strength comes from the collective
    application of our diverse talents, and is a critical component of the
    air and space dominance we enjoy today. We must enthusiastically reach
    out to all segments of society to ensure the Air Force offers a
    welcoming career to the best and brightest of American society,
    regardless of their background. By doing so, we attract people from all
    segments of society and tap into the limitless talents resident in our
    diverse population.
        In addition to a diverse force, we also need the correct talent
    mix. We remain concerned about recruiting health care professionals and
    individuals with technical degrees. To meet our needs, we continue to
    focus our efforts to ensure we attract and retain the right people. We
    will also closely monitor ARC recruitment. Historically, the Air
    National Guard and Air Force Reserve Command access close to 25 percent
    of eligible, separating active duty Air Force members with no break in
    service between their active duty and ARC service.
    Developing the Force
        Over the past year, we implemented a new force development
    construct in order to get the right people in the right job at the
    right time with the right skills, knowledge, and experience. Force
    development combines focused assignments and education and training
    opportunities to prepare our people to meet the mission needs of our
    Air Force. Rather than allowing chance and happenstance to guide an
    airman's experience, we will take a deliberate approach to develop
    officers, enlisted, and civilians throughout our Total Force. Through
    targeted education, training, and mission-related experience, we will
    develop professional airmen into joint force warriors with the skills
    needed across the tactical, operational, and strategic levels of
    conflict. Their mission will be to accomplish the joint mission,
    motivate teams, mentor subordinates, and train their successors.
        A segment of warriors requiring special attention is our cadre of
    space professionals, those that design, build, and operate our space
    systems. As military dependence on space grows, the Air Force continues
    to develop this cadre to meet our Nation's needs. Our Space
    Professional Strategy is the roadmap for developing that cadre. Air
    Force space professionals will develop more in-depth expertise in
    operational and technical space specialties through tailored
    assignments, education, and training. This roadmap will result in a
    team of scientists, engineers, program managers, and operators skilled
    and knowledgeable in developing, acquiring, applying, sustaining, and
    integrating space capabilities.
    Sustaining the Force
        The Air Force is a retention-based force. Because the skill sets of
    our airmen are not easily replaced, we expend considerable effort to
    retain our people, especially those in high-technology fields and those
    in whom we have invested significant education and training. In 2003,
    we reaped the benefits of an aggressive retention program, aided by a
    renewed focus and investment on education and individual development,
    enlistment and retention bonuses, targeted military pay raises, and
    quality of life improvements. Our fiscal year 2003 enlisted retention
    statistics tell the story. Retention for first term airmen stood at 61
    percent, exceeding our goal by 6 percent. Retention for our second term
    and career airmen was also impressive, achieving 73 percent and 95
    percent respectively. Continued investment in people rewards their
    service, provides a suitable standard of living, and enables us to
    attract and retain the professionals we need.
        One of the highlights of our quality of life focus is housing
    investment. Through military construction and housing privatization, we
    are providing quality homes faster than ever before. Over the next 3
    years, the Air Force will renovate or replace more than 40,000 homes
    through privatization. At the same time, we will renovate or replace an
    additional 20,000 homes through military construction. With the
    elimination of out-of-pocket housing expenses, our Air Force members
    and their families now have three great options--local community
    housing, traditional military family housing, and privatized housing.
    Focus On Fitness
        We recognize that without motivated and combat-ready expeditionary
    airmen throughout our Total Force, our strategies, advanced
    technologies, and integrated capabilities would be much less effective.
    That is why we have renewed our focus on fitness and first-class
    fitness centers. We must be fit to fight. That demands that we reorient
    our culture to make physical and mental fitness part of our daily life
    as airmen. In January 2004, our new fitness program returned to the
    basics of running, sit-ups, and pushups. The program combines our
    fitness guidelines and weight/body fat standards into one program that
    encompasses the total health of an airman.
                           technology-to-warfighting
        The Air Force has established a capabilities-based approach to war
    planning, allowing us to focus investments on those capabilities we
    need to support the joint warfighter. This type of planning focuses on
    capabilities required to accomplish a variety of missions and to
    achieve desired effects against any potential threats. Our
    capabilities-based approach requires us to think in new ways and
    consider combinations of systems that create distinctive capabilities.
    Effects Focus: Capabilities-Based CONOPs
        The Air Force has written six CONOPs that support capabilities-
    based planning and the joint vision of combat operations. The CONOPs
    help analyze the span of joint tasks we may be asked to perform and
    define the effects we can produce. Most importantly, they help us
    identify the capabilities an expeditionary force will need to
    accomplish its mission, creating a framework that enables us to shape
    our portfolio.

             Homeland Security CONOPs leverage Air Force
            capabilities with joint and interagency efforts to prevent,
            protect, and respond to threats against our homeland--within or
            beyond U.S. territories.
             Space and Command, Control, Communications, Computers,
            Intelligence, Surveillance, and Reconnaissance (C\4\ISR) CONOPs
            harness the integration of manned, unmanned, and space systems
            to provide persistent situation awareness and executable
            decision-quality information to the JFC.
             Global Mobility CONOPs provide combatant commanders
            with the planning, command and control, and operations
            capabilities to enable timely and effective projection,
            employment, and sustainment of U.S. power in support of U.S.
            global interests--precision delivery for operational effect.
             Global Strike CONOPs employ joint power-projection
            capabilities to engage anti-access and high-value targets, gain
            access to denied battlespace, and maintain battlespace access
            for required joint/coalition follow-on operations.
             Global Persistent Attack CONOPs provide a spectrum of
            capabilities from major combat to peacekeeping and sustainment
            operations. Global Persistent Attack assumes that once access
            conditions are established (i.e. through Global Strike), there
            will be a need for persistent and sustained operations to
            maintain air, space, and information dominance.
             Nuclear Response CONOPs provide the deterrent
            ``umbrella'' under which conventional forces operate, and, if
            deterrence fails, avails a scalable response.

        This CONOPs approach has resulted in numerous benefits, providing:

             Articulation of operational capabilities that will
            prevail in conflicts and avert technological surprises;
             An operational risk and capabilities-based
            programmatic decisionmaking focus;
             Budgeting guidance to the Air Force Major Commands for
            fulfilling capabilities-based solutions to satisfy warfighter
            requirements;
             Warfighter risk management insights for long-range
            planning.
    Modernization and Recapitalization
        Through capabilities-based planning, the Air Force will continue to
    invest in our core competency of bringing technology to the warfighter
    that will maintain our technical advantage and update our air and space
    capabilities. The Capabilities Review and Risk Assessment (CRRA)
    process guides these efforts. Replacing an outdated threat-based review
    process that focused on platforms versus current and future warfighting
    effects and capabilities, our extensive 2-year assessment identified
    and prioritized critical operational shortfalls we will use to guide
    our investment strategy. These priorities present the most significant
    and immediate Air Force-wide capability objectives.
        We need to field capabilities that allow us to reduce the time
    required to find, fix, track and target fleeting and mobile targets and
    other hostile forces. One system that addresses this operational
    shortfall is the F/A-22 Raptor. In addition to its contributions to
    obtaining and sustaining air dominance, the F/A-22 will allow all
    weather, stealthy, precision strike 24 hours a day, and will counter
    existing and emerging threats, such as advanced surface-to-air
    missiles, cruise missiles, and time sensitive and emerging targets,
    including mobile targets, that our legacy systems cannot. The F/A-22 is
    in low rate initial production and has begun Phase I of its operational
    testing. It is on track for initial operational capability in 2005. A
    complementary capability is provided by the F-35 Joint Strike Fighter,
    providing sustainable, focused CAS and interservice and coalition
    commonality.
        We also recognize that operational shortfalls exist early in the
    kill chain and are applying technologies to fill those gaps. A robust
    command, control, and sensor portfolio combining both space and
    airborne systems, along with seamless real-time communications, will
    provide additional critical capabilities that address this shortfall
    while supporting the Joint Operational Concept of full spectrum
    dominance. Program definition and risk reduction efforts are moving us
    towards C\4\ISR and Battle Management capabilities with shorter cycle
    times. The JFC will be able to respond to fleeting opportunities with
    near-real time information and will be able to bring to bear kill-chain
    assets against the enemy. Additionally, in this world of proliferating
    cruise missile technology, our work on improving our C\4\ISR
    capabilities--including airborne Active Electronically Scanned Array
    (AESA) radar technology--could pay large dividends, playing a
    significant role in America's defense against these and other threats.
    To create this robust command and control network, we will need a
    flexible and digital multi-service communications capability. We are
    well on our way in defining the architecture to make it a reality. The
    capabilities we are pursuing directly support the Department's
    transformational system of interoperable joint C\4\ISR.
        There is a need for a globally interconnected capability that
    collects, processes, stores, disseminates, and manages information on
    demand to warfighters, policy makers, and support people. The C2
    Constellation, our capstone concept for achieving the integration of
    air and space operations, includes these concepts and the future
    capabilities of the Global Information Grid (GIG), Net Centric
    Enterprise Services, Transformational Communications, the Joint
    Tactical Radio System, and airborne command, control, and communication
    assets, among others.
        One of the elements of a sensible strategy to maintain U.S. power
    projection capabilities derives from a global aerial refueling fleet
    that serves Air Force, Navy, Marine Corps, and coalition aircraft. Our
    current fleet of aging tankers met the challenges of OEF and OIF but is
    increasingly expensive to maintain. The fleet averages more then 40
    years of age, and the oldest model, the KC-135E, goes back to the
    Eisenhower administration. Recapitalization for this fleet of over 540
    aerial refueling aircraft will clearly take decades to complete and is
    vital to the foundation and global reach of our Air Force, sister
    Services, and coalition partners. The Air Force is committed to an
    acquisition approach for this program that will recapitalize the fleet
    in the most affordable manner possible.
        Capabilities-driven modernization and recapitalization efforts are
    also taking place on our space systems, as we replace constellations of
    satellites and ground systems with next generation capabilities. The
    Evolved Expendable Launch Vehicle (EELV) has completed six successful
    launches. Using two launch designs, we will continue to seek
    responsive, assured access to space for government systems. Space-based
    radar (SBR) will provide a complementary capability to our portfolio of
    radar and remote sensing systems. We will employ internet protocol
    networks and high-bandwidth lasers in space to transform communications
    with the Transformational Satellite, dramatically increasing
    connectivity to the warfighter. Modernization of GPS and development of
    the next-generation GPS III will enhance navigation capability and
    increase our resistance to jamming. In partnership with the National
    Aeronautics and Space Administration (NASA) and the Department of
    Commerce, we are developing the National Polar-orbiting Operational
    Environmental Satellite System, which offers next-generation
    meteorological capability. Each of these systems supports critical
    C\4\ISR capabilities that give the JFC increased technological and
    asymmetric advantages.
        Space control efforts, enabled by robust space situation awareness,
    will ensure unhampered access to space-based services. Enhanced space
    situation awareness assets will provide the information necessary to
    execute an effective space control strategy. However, we must be
    prepared to deprive an adversary of the benefits of space capabilities
    when American interests and lives are at stake.
        Additional capability does not stem solely from new weapon system
    acquisitions. It results from innovative modernization of our existing
    systems. One example is incorporating a Smart Bomb Rack Assembly and
    the 500-lb. version of the Joint Direct Attack Munition (JDAM) into the
    weapons bay of the B-2. In September 2003, we demonstrated that the B-2
    bomber is now able to release up to 80 separately targeted, GPS-guided
    weapons in a single mission. This kind of innovation reduces the number
    of platforms that must penetrate enemy airspace while holding numerous
    enemy targets at risk. The second order consequences run the gamut from
    maintenance to support aircraft.
        We will also address the deficiencies in our infrastructure through
    modernization and recapitalization. Improvements to our air and space
    systems will be limited without improvements in our foundational
    support systems. Deteriorated airfields, hangars, waterlines,
    electrical networks, and air traffic control approach and landing
    systems are just some of the infrastructure elements needing immediate
    attention. Our investment strategy focuses on three simultaneous steps:
    disposing of excess facilities; sustaining our facilities and
    infrastructure; and establishing a sustainable investment program for
    future modernization of our facilities and infrastructure.
        Finally, we need to continue to modernize and recapitalize our
    information technology infrastructure. To leverage our information
    superiority, the Air Force is pursuing a modernization strategy and
    information technology investments, which target a common network
    infrastructure and employ enterprise services and shared capabilities.
    Science and Technology
        Our investment in S&T has and continues to underpin our
    modernization and recapitalization program. Similar to our applied-
    technology acquisition efforts, the Air Force's capability-based focus
    produces an S&T vision that supports the warfighter.
        The Air Force S&T program fosters development of joint warfighting
    capabilities and integrated technologies, consistent with DOD and
    national priorities. We will provide a long-term, stable investment in
    S&T in areas that will immediately benefit existing systems and in
    transformational technologies that will improve tomorrow's Air Force.
    Many Air Force S&T programs, such as directed energy, hypersonics,
    laser-based communications, and the emerging field of nanotechnology,
    show promise for joint warfighting capabilities. Other technology
    areas, such as miniaturization of space platforms and space proximity
    operations, also show promise in the future. Through developments like
    these, the Air Force S&T program will advance joint warfighting
    capabilities and the Air Force vision of an integrated air and space
    force capable of responsive and decisive global engagement.
    Capabilities-Based Acquisition/Transforming Business Practices
        To achieve our vision of a flexible, responsive, and capabilities-
    based expeditionary force, we are transforming how we conceive, plan,
    develop, acquire, and sustain weapons systems. Our Agile Acquisition
    initiative emphasizes speed and credibility; we must deliver what we
    promise--on time and on budget. Our goal is to deliver affordable,
    sustainable capabilities that meet joint warfighters' operational
    needs.
        We continue to improve our acquisition system--breaking down
    organizational barriers, changing work culture through aggressive
    training, and reforming processes with policies that encourage
    innovation and collaboration. Already, we are:

             Realigning our Program Executive Officers (PEOs). By
            moving our PEOs out of Washington and making them commanders of
            our product centers, we have aligned both acquisition
            accountability and resources under our most experienced general
            officers and acquisition professionals.
             Creating a culture of innovation. Because people drive
            the success of our Agile Acquisition initiatives, we will focus
            on enhanced training. Laying the foundation for change, this
            past year 16,500 Air Force acquisition professionals, and
            hundreds of personnel from other disciplines, attended training
            sessions underscoring the need for collaboration, innovation,
            reasonable risk management, and a sense of urgency in our
            approach.
             Reducing Total Ownership Costs. With strong support
            from the Secretary of Defense, we will expand the Reduction in
            Total Ownership Cost program with a standard model ensuring
            that we have accurate metrics.
             Moving technology from the lab to the warfighter
            quickly. Laboratories must focus on warfighter requirements and
            researchers need to ensure technologies are mature, producible,
            and supportable. Warfighters will work with scientists,
            acquisition experts, and major commands to identify gaps in
            capabilities. With help from Congress, we have matured our
            combat capability document process to fill those gaps. During
            OIF, we approved 37 requests for critically needed systems,
            usually in a matter of days.
             Tailoring acquisition methods for space systems. In
            October 2003, we issued a new acquisition policy for space
            systems that will improve acquisitions by tailoring acquisition
            procedures to the unique demands of space systems.

        Transformation of our business processes is not limited to
    acquisition activities. Our Depot Maintenance Strategy and Master Plan
    calls for financial and infrastructure capitalization to ensure Air
    Force hardware is safe and ready to operate across the threat spectrum.
    Our increased funding for depot facilities and equipment modernization
    in fiscal year 2004-2009, along with public-private partnerships, will
    result in more responsive support to the JFC. We expect to maximize
    production and throughput of weapon systems and commodities that will
    improve mission capability.
        Our logistics transformation initiative will revolutionize
    logistics processes to improve warfighter support and reduce costs. The
    goal of the Air Force's logistics transformation program, Expeditionary
    Logistics for the 21st century, is to increase weapon system
    availability by 20 percent with zero cost growth. Our current
    initiatives--depot maintenance transformation, purchasing and supply
    chain management, regionalized intermediate repair, and improved
    logistics command and control--will transform the entire logistics
    enterprise.
        Our depots have put some of these initiatives into place with
    exceptional results. In fiscal year 2003, our depot maintenance teams
    were more productive than planned, exceeding aircraft, engine, and
    commodity production goals and reducing flow days in nearly all areas.
    Implementation of ``lean'' production processes, optimized use of the
    existing workforce, and appropriate funding, all contributed to this
    good news story. In addition, our spares support to the warfighter is
    at record high numbers. In 2003, supply rates and cannibalization rates
    achieved their best performance since fiscal years 1994 and 1995,
    respectively. Fourteen of 20 aircraft design systems improved their
    mission capable rates over the previous year, with Predator UAVs
    improving by 11 percent, and B-1 bombers achieving the best mission
    capable and supply rates in its history. Thanks to proper funding,
    fleet consolidation, and transformation initiatives, spare parts
    shortages were reduced to the lowest levels recorded across the entire
    fleet.
    Financing the Fight
        An operating strategy is only as good as its financing strategy.
    Similar to acquisition, logistics, and other support processes, our
    finance capabilities are strong. We are taking deliberate and
    aggressive steps to upgrade our financial decision support capability
    and reduce the cost of delivering financial services. Our focus is on
    support to our airmen, strategic resourcing and cost management, and
    information reliability and integration. The initiatives that will get
    us there include self-service web-based pay and personnel customer
    service, seamless e-commerce for our vendor payment environment,
    budgets that link planning, programming, and execution to capabilities
    and performance, financial statements that produce clean audit opinions
    while providing reliable financial and management information, and
    innovative financing strategies.
                             integrating operations
        The Air Force excels at providing communications, intelligence, air
    mobility, precision strike, and space capabilities that enable joint
    operations. Our airmen integrate these and other capabilities into a
    cohesive system that creates war-winning effects. Integration takes
    place at three levels. At the joint strategic level, integration occurs
    between interagencies and the coalition. Integration also takes place
    within the Air Force at an organizational level. At its most basic
    level, integration takes place at the machine-to-machine level to
    achieve universal information sharing which facilitates true
    integration at every level.
    Integrating Joint, Coalition, and Interagency Operations
        The ever-changing dynamics of global events will drive the need to
    integrate DOD and interagency capabilities and, in most cases, those of
    our coalition partners. Joint solutions are required to produce
    warfighting effects with the speed that the global war on terrorism
    demands. Fully integrated operations employ only the right forces and
    capabilities necessary to achieve an objective in the most efficient
    manner. We must also integrate space capabilities for national
    intelligence and warfighting.
        We are pursuing adaptations of our C2 organizations and
    capabilities to support this vision. While the Air Force's global C2
    structure has remained relatively constant, throughout our 57-year
    history, the demands of a changing geopolitical environment have
    stressed current C2 elements beyond their design limits.
        We have conducted an extensive review of our C2 structures to
    support the National Security Strategy objectives of assure, dissuade,
    deter, and defeat as well as the Secretary of Defense's Unified Command
    Plan (UCP). We will enhance our support for the JFC and our
    expeditionary posture through a new Warfighting Headquarters Construct.
    This will enable the Numbered Air Forces to support Unified Combatant
    Commanders in a habitual supported-supporting relationship. Working
    with their strategy and planning cells on a daily basis will ensure
    that Air Force capabilities are available to the JFC's warfighting
    staff. This new headquarters will provide the Combined Air Operations
    Center (CAOC) with sufficient staff to focus on planning and employment
    of air, space, and information operations throughout the theater.
        We are also adapting the capabilities of our CAOCs. The CAOCs of
    each headquarters will be interconnected with the theater CAOCs, all
    operating 24 hours a day, 7 days a week. They will be operated as a
    weapons system, certified and standardized, and have cognizance of the
    entire air and space picture. This reorganization will increase our
    ability to support our combatant commanders, reduce redundancies, and
    deliver precise effects to the warfighters. As we near completion of
    the concept development, we will work with the Secretary of Defense and
    Congress to implement a more streamlined and responsive C2 component
    for the combatant commanders and national leadership.
        Integrated operations also depend on integrated training. We
    continue to advance joint and combined interoperability training with
    our sister Services and the nations with which we participate in global
    operations. The Joint National Training Capability (JNTC) will improve
    our opportunities for joint training. The aim of the JNTC is to improve
    each Service's ability to work with other Services at the tactical
    level and to improve joint planning and execution at the operational
    and strategic levels. The Air Force has integrated live, virtual, and
    constructive training environments into a single training realm using a
    distributed mission operations (DMO) capability. JNTC will use this DMO
    capability to tie live training events with virtual (man-in-the-loop)
    play and constructive simulations. Live training in 2004--on our ranges
    during four Service-conducted major training events--will benefit from
    improved instrumentation and links to other ranges as well as the
    ability to supplement live training with virtual or constructive
    options. These types of integrated training operations reduce overall
    costs to the services while providing us yet another avenue to train
    like we fight.
    Integrating Within the Air Force
        The Air Force is continuing to strengthen and refine our AEF. The
    AEF enables rapid build-up and redeployment of air and space power
    without a lapse in the Air Force's ability to support a combatant
    commander's operations. The Air Force provides forces to combatant
    commanders according the AEF Presence Policy (AEFPP), the Air Force
    portion of DOD's Joint Presence Policy. There are 10 AEFs, and each AEF
    provides a portfolio of capabilities and force modules. At any given
    time, two AEFs are postured to immediately provide these capabilities.
    The other eight are in various stages of rest, training, spin-up, or
    standby. The AEF is how the Air Force organizes, trains, equips, and
    sustains responsive air and space forces to meet defense strategy
    requirements outlined in the Strategic Planning Guidance.
        Within the AEF, Air Force forces are organized and presented to
    combatant commanders as Air and Space Expeditionary Task Forces
    (AETFs). They are sized to meet the combatant commander's requirements
    and may be provided in one of three forms: as an Air Expeditionary Wing
    (AEW), Group (AEG), and/or Squadron (AES). An AETF may consist of a
    single AEW or AEG, or may consist of multiple AEWs or AEGs and/or as a
    Numbered Expeditionary Air Force. AETFs provide the functional
    capabilities (weapon systems, expeditionary combat support and command
    and control) to achieve desired effects in an integrated joint
    operational environment.
        One of our distinctive Air Force capabilities is Agile Combat
    Support (ACS.) To provide this capability, our expeditionary combat
    support forces--medics, logisticians, engineers, communicators,
    security forces, services, and contracting, among several others--
    provide a base support system that is highly mobile, flexible, and
    fully integrated with air and space operations. ACS ensures responsive
    expeditionary support to joint operations is achievable within resource
    constraints--from creation of operating locations to provision of
    right-sized forces. An example of this capability is the 86th
    Contingency Response Group (CRG) at Ramstein Air Base, organized,
    trained, and equipped to provide an initial ``Open the Base'' force
    module to meet combatant commander requirements. The CRG provides a
    rapid response team to assess operating location suitability and
    defines combat support capabilities needed to establish Air
    Expeditionary Force operating locations.
        Another example of ACS capability is the light and lean
    Expeditionary Medical System (EMEDS) that provides the U.S. military's
    farthest forward care and surgical capability. Air Force medics jump
    into the fight alongside the very first combatants. Whether supporting
    the opening of an air base or performing life saving surgeries, these
    medics bring an extraordinary capability. They carry backpacks with
    reinforced medical equipment, permitting them to perform medical
    operations within minutes of their boots hitting the ground.
    Complementing this expeditionary medical capability is our air
    evacuation system that provides the lifeline for those injured
    personnel not able to return to duty. The other Services and our allies
    benefited greatly from this capability in OEF and OIF. The Army and
    Navy are now developing a similar light and lean capability. The
    success of EMEDS is also apparent in the reduction of disease and non-
    battle injuries--the lowest ever in combat.
    Horizontal Machine-to-Machine Integration
        We also strive to increasingly integrate operations at the most
    basic level--electron to electron. Victory belongs to those who can
    collect intelligence, communicate information, and bring capabilities
    to bear first. Executing these complex tasks with accuracy, speed, and
    power requires assured access and the seamless, horizontal integration
    of systems, activities and expertise across all manned, unmanned, and
    space capabilities. Such integration will dramatically shorten the kill
    chain.
        Machine-to-machine integration means giving the warfighter the
    right information at the right time. It facilitates the exchange of
    large amounts of information, providing every machine the information
    it needs about the battlespace and an ability to share that
    information. In the future, we will significantly reduce the persistent
    challenges of having different perspectives or pictures of the
    battlefield. Examples would be to ensure that the A-10 could see the
    same target as the Predator or to guarantee that the F-15 has the same
    intelligence about enemy radars as the Rivet Joint.
        We want a system where information is made available and delivered
    without regard to the source of the information, who analyzed the
    information, or who disseminated the information. It is the end product
    that is important, not the fingers that touch it. The culmination of
    the effort is the cursor over the target. It is an effect we seek, and
    what we will provide.
        The warfighters' future success will depend on Predictive
    Battlespace Awareness (PBA). PBA relies on in-depth study of an
    adversary before hostilities begin in order to anticipate his actions
    to the maximum extent possible. We can then analyze information to
    assess current conditions, exploit opportunities, anticipate future
    actions, and act with a degree of speed and certainty unmatched by our
    adversaries. PBA also relies on the ability of air and space systems to
    integrate information at the machine-to-machine level and produce high-
    fidelity intelligence that results in a cursor over the target. The
    result--integrated operations--is our unique ability to conduct PBA and
    impact the target at the time and place of our choosing. This machine-
    to-machine integration will include a constellation of sensors that
    create a network of information providing joint warfighters the
    information and continuity to see first, understand first, and act
    first.
        The C2 Constellation is the Air Force capstone concept for
    achieving the integration of air and space operations. Our vision of
    the C2 Constellation is a robust, protected network infrastructure, a
    globally based command and control system to encompass all levels of
    the battle and allow machines to do the integration and fusion. It uses
    Battle Management Command and Control and Connectivity and consists of
    command centers, sensors, and systems like the U-2, SBR, the
    Distributed Common Ground System, and our CAOCs. Given the C2
    Constellation's complexity, the Air Force recognizes the need for an
    architecture to address myriad integration issues--methodically--so all
    elements work in concert.
                        securing america's next horizon
        Armed with the heritage of air and space power in combat, the
    lessons learned from our most recent conflicts, and the powerful
    advances in technology in the 21st century, we stand ready to deliver
    decisive air and space power in support of our Nation. Whether called
    to execute a commanding show of force, to enable the joint fight, to
    deliver humanitarian assistance, or to protect our Nation from the
    scourge of terrorism, we will deliver the effects required. Our ability
    to consistently answer the call is our dividend to the Nation, a result
    of our sustained investment in people, technology, and integration.
        Our portfolio of advantages provides dividends on the battlefield.
    We bring to bear a diversified collection of capabilities, which answer
    the needs of a spectrum of combat and humanitarian operations. As one
    would with any investment, we will monitor, maintain, and adjust our
    investments as needed to reflect the demands of a dynamic environment.
    Transformational initiatives in the way we organize, train, and equip
    reflect such adjustments, changes that will result in significant gains
    for our force, for the joint team, and for our Nation. Yet, we will not
    shift our focus from the core competencies that have provided the
    foundation for our success and continue to do so. The success of the
    Air Force resides in the airmen who employ the technology of
    warfighting through integrated operations with our joint and coalition
    partners. This is our heritage and our future. This is America's Air
    Force.

        Chairman Warner. Thank you, General, for that statement. I
    think the committee as a whole is very appreciative of the good
    strong reports from each of you that we have received this
    morning.
        We will now proceed to a first round of 6 minutes each and
    I will lead off. General Schoomaker, we are preparing to have
    one of the largest rotations of forces in Iraq in contemporary
    military history. That not only involves the training to have
    those men and women ready when they arrive, but also the
    equipment. You and I have spent some time here recently in
    consultation on how at this very moment further adaptations are
    being made to the equipment, particularly the high-mobility
    multipurpose wheeled vehicle (HMMWV), to meet the ever-changing
    type of threat and weaponry being used. General Hagee, you are
    about to oversee your forces once again returning to Iraq.
        So I will ask each of you to discuss the ramifications of
    this very significant turnover of forces and equipment, whether
    it is the HMMWV, personal vests, or body armor. What is the
    status as they go into this face of harm's way?
        General Schoomaker. Sir, as you correctly stated, this is
    one of the largest movements we have had since World War II. It
    is very complex. We have approached it in a very deliberative
    fashion, we have extended the period of time in which this
    rotation will take place to provide for the adequate
    preparation time, training, coordination, reconnaissance, and
    all of the things we have to do to ensure an appropriate
    seamless turnover of forces for this very complicated theater.
        Included in this is the extensive management of the
    equipment that will remain behind. Any equipment that we have
    designed, especially for force protection, including the up-
    armored vehicles, not just the up-armored HMMWVs but the
    extensive efforts we have been making on other larger vehicles
    that are there--supply trucks, the body armor, these kinds of
    things. We have, I am happy to say, met the goal--which I
    testified to previously--in both Iraq and Kuwait to have the
    Interceptor Body Armor now over there in sufficient numbers for
    everybody to have. All of that will remain in place and it is
    being managed in a very detailed way that will ensure that
    nobody is not protected with the very best equipment that we
    can acquire.
        We have tripled the number of up-armored HMMWVs that are in
    the theater and are moving toward a requirement of 4,100. This
    is a constantly moving target. We have included the Marine
    Corps' requirements in that number and we are working very
    closely with General Hagee's people to ensure that adequate
    distribution of vehicles for their sector takes place.
        We have significantly increased production of this
    equipment. You and I have had extensive conversations about not
    only the up-armored HMMWV situation but also the add-on armor
    kits that are being produced. So unless you want to go into
    more detail, sir, I will stop there.
        Chairman Warner. That is fine.
        General Hagee.
        General Hagee. I will not repeat what General Schoomaker
    said, but we are ready. We have about 3,000 vehicles--which
    includes both large vehicles and the smaller HMMWVs--that we
    are hardening right now in conjunction with the Army. The Army
    is also leaving behind some of their so-called up-armored
    HMMWVs. When the transfer of authority takes place we believe
    that we will have all of our vehicles hardened and ready to go.
        We have enough body armor for every single marine to
    produce sufficient protection, not only in Iraq but in
    Afghanistan. Working with the Army, we have also developed
    technical means against these improvised explosive devices
    (IEDs), but I cannot go any further here in open session.
        In addition, we have spent the last few months working with
    the Army doing extensive training, taking their lessons learned
    from Iraq. We have sent every single maneuver battalion through
    an extensive 1-week course out in southern California. We have
    taken all of our pilots and put them through a 2-week course
    down at Yuma, Arizona. We have also taken our combat support
    and combat service support marines, reminded them that every
    marine is a rifleman, and sent them through an extensive
    training course.
        Sir, as we deploy this month we believe we are ready.
        Chairman Warner. Thank you.
        The Commandant mentioned Afghanistan. Obviously, the
    theaters are in some competition for equipment. It would be my
    expectation that you find that your forces in Afghanistan are
    equally well equipped as those in Iraq. Am I correct on that,
    General?
        General Schoomaker. That is correct, sir.
        Chairman Warner. You mentioned in your opening statement
    the tremendous value the Guard and Reserve have held throughout
    this and indeed other conflicts. Yet when the Secretary of
    Defense came, he very forthrightly said that there had been
    some analytical studies made of the Guard and Reserve and their
    training, and workup for such operations should be changed.
        Can you elaborate on how you are working with the Guard and
    Reserve community to begin to make them into units that are
    more readily able to integrate with the Active Forces?
        General Schoomaker. Sir, I would be happy to. At the
    highest level, our initiative of modularity that allows us to
    plug and play Reserve component units with active component
    units in a seamless fashion is, of course, our objective. Take
    a look at the way that we have been and are currently preparing
    and have been preparing the three guard brigades that are part
    of this current rotation going in for OIF 2. We have put the
    very best equipment on these soldiers, about $3,000 a set,
    including Interceptor Body Armor, the very best of weaponry,
    and all of the other equipment that is out there. They have
    been going through one of the most extensive training regimens,
    both at the National Training Center and at the Joint Readiness
    Training Center, which replicates very closely the environment
    in which they will operate, with extensive civilians on the
    battlefield, etcetera.
        Chairman Warner. Thank you for that, General.
        Lastly, General Jumper. The brunt of the transportation has
    fallen in many ways on your Transportation Command. What is the
    status of those aircraft and their ability to really handle
    this enormous transfer of forces that it is beginning to
    undertake?
        General Jumper. Mr. Chairman, a great deal of planning has
    gone on, not only for the airborne portion of this, but also
    for the portion that we send on ships. I have talked to General
    Handy, the commander of the U.S. Transportation Command, about
    this and he has a flow plan that is going to get this done in a
    timely fashion.
        I am confident that the planning for this has been good and
    that the flow will be normal.
        Chairman Warner. The Navy's role, Admiral, is up and ready
    on this?
        Admiral Clark. That is correct, sir. As we speak, we have a
    ship full of General Hagee's helicopters in the Red Sea en
    route, and all of the other shipping that is required is under
    control and ready to go.
        Chairman Warner. Thank you, gentlemen.
        Senator Levin.
        Senator Levin. Thank you, Mr. Chairman.
        As I indicated in my opening remarks, the budget that is
    before us does not include funding to pay for the incremental
    costs of operations in Iraq and Afghanistan. How are we going
    to pay for the costs that we know are going to be incurred
    before a supplemental budget is presented to us in next
    January?
        Let me ask General Schoomaker specifically. Do you have an
    estimate of the incremental costs that are going to be required
    to continue those ongoing operations at the same level in Iraq
    and in Afghanistan?
        General Schoomaker. Sir, I do not have an estimate, other
    than to look at the level at which we are currently operating.
    This year our share of that supplemental approached around $38
    billion, in the fiscal year 2004 budget.
        Senator Levin. Do you have an estimate as to what the
    approximate monthly incremental cost would be to maintain those
    operations at the current level?
        General Schoomaker. At the current level, sir, I believe we
    are expending around $3.7 billion in Iraq.
        Senator Levin. Per month?
        General Schoomaker. Per month, yes, sir.
        Senator Levin. Those are incremental costs?
        General Schoomaker. This is what I understand right now to
    be the total cost of operating in Iraq. In Afghanistan it is
    about $900 million a month.
        Senator Levin. Do you have the costs for the other
    Services? General Hagee, do you have a cost?
        General Hagee. Sir, right now, within the Marine Corps, we
    are projecting for this fiscal year expending about $800
    million to $900 million. Discussing this with the Secretary of
    the Navy, we believe that for this year it is about $1.5
    billion. We have captured those costs. We have submitted them
    to the Office of the Secretary of Defense (OSD) and we expect
    for them to be paid out of the supplemental.
        Senator Levin. General Schoomaker, General Hagee, press
    reports indicate that the Central Intelligence Agency (CIA) is
    concerned that a civil war could erupt in Iraq within the next
    6 months. How prepared are your forces, given the large
    rotation, to address that potential turn of events if this
    occurred, General Schoomaker?
        General Schoomaker. Sir, we are going to have a peak of
    almost 200,000 people in there at the peak of the rotation. We
    certainly are not intending to hold those people in there. That
    is part of the rotation base.
        I have heard of the discussions about the possibility of
    civil war and that is clearly a possibility, but I have not
    heard anybody predicting that in fact that is the case. We are
    prepared to deal with whatever comes our way. We are very well
    prepared to fight. We are very well prepared to do our duty
    there in the manner that we are doing it now.
        Senator Levin. General Hagee, do you have any comment on
    that?
        General Hagee. Sir, I would align myself with the Chief of
    Staff of the Army.
        Senator Levin. There were a number of expectations and
    assumptions that were based on prewar intelligence that did not
    pan out. For example, the expectation that many Iraqi army
    units would defect. That did not happen. There was an
    expectation that Iraqi police would stay at their stations.
    That did not happen.
        The fact that these did not happen led to subsequent
    events, such as the looting and the destruction of government
    files and buildings. These events probably led to what I and
    others consider to be a major error; the decision of Ambassador
    Bremer to disestablish the Iraqi army. As a result the various
    Iraqi security units had to be rebuilt from the ground up.
        There are certain other predictions, assumptions, and
    assessments, made by the Intelligence Community which did not
    take place. Obviously, the first is the presence of WMD.
    General Hagee gave us one example of how our actions were
    affected by those assessments and predictions. The same thing
    could be said relative to a CIA assessment that Iraq had UAVs
    that were intended for delivering WMD, but apparently they did
    not.
        There were more than 500 sites where WMD or WMD-related
    activities were possibly located. This means that there may
    have been targets that we did not strike because we were
    concerned about collateral damage from the potential release of
    chemical and biological weapons. Those are just some of the
    assessments and predictions that did not pan out.
        This is my question to each of you: Have you been
    interviewed by either the Senate or House Intelligence
    Committees or by any other congressional committee to determine
    the impact of prewar intelligence on the planning for or the
    conduct of OIF? General Schoomaker?
        General Schoomaker. No, sir, I have not.
        Senator Levin. Admiral Clark?
        Admiral Clark. No, sir.
        Senator Levin. General Hagee?
        General Hagee. No, sir.
        Senator Levin. General Jumper?
        General Jumper. No, sir.
        Senator Levin. Do we have contingency plans in the event
    that Iraq, after sovereignty is transferred to them, does not
    agree to provide the status that we want for our U.S. forces in
    Iraq? Once sovereignty is transferred, we are going to have to
    deal then with whoever that sovereign is relative to the
    operation of our forces and presumably reach an agreement with
    that entity that represents the government of Iraq relative to
    the status of our forces and the ability of our forces to
    operate.
        Do we have contingency plans in the event that Iraq does
    not agree to provide the status that we want or allow the U.S.
    forces to operate freely there? General, let me again start
    with you. Do you know of any contingency plan?
        General Schoomaker. Sir, I am not aware of what is going on
    in that regard. I think it is appropriate for General Abizaid
    to address that.
        Senator Levin. Do any of you have any comment on that? [No
    response.]
        My time is up. Thank you.
        Chairman Warner. Senator McCain.
        Senator McCain. Thank you, Mr. Chairman. I want to thank
    the witnesses for being here today.
        General Schoomaker, this transition that was just discussed
    of troops being rotated in Iraq will result in about 40 percent
    of those troops being Guard and Reserve units. Is that correct?
        General Schoomaker. Sir, I believe the last figure I was
    given is about 37 percent.
        Senator McCain. This is probably the largest percentage of
    guardsmen and reservists in a combat situation in history.
    Would you agree with that?
        General Schoomaker. Sir, I would not be able to agree with
    that. I do not know. I am not sure.
        Senator McCain. I do not have the facts, but I continue to
    disagree with the assertion made by the Secretary of Defense
    and all of you again today that we will not have significant
    impact on retention of guardsmen and reservists. Many of these
    guardsmen and reservists will be there for their second tour,
    is that correct?
        General Schoomaker. Sir, I do not have the figures before
    me, but if I recall the testimony the Secretary gave the other
    day, something like 7 percent of the Guard and Reserve has been
    called up more than once.
        Senator McCain. Well, we will find out, I guess. As I have
    said before, I hope that I am wrong.
        You intend to expand, General Schoomaker, the size of the
    Army by 30,000 individuals over 4 years. Is that correct?
        General Schoomaker. Sir, I have asked to grow some headroom
    in the Army so that we have the ability to do the modularity,
    movements, and transformation that we want to do, while we find
    the offsets for them within our current end strength
    authorization.
        Senator McCain. I guess I had better repeat the question,
    General Schoomaker: Is there going to be an increase of 30,000
    troops over a 4-year period?
        General Schoomaker. Yes, sir.
        Senator McCain. Do you intend to ask for that to be paid
    for each year in an emergency supplemental? It is not reflected
    in any budget request by the DOD.
        General Schoomaker. No, sir, it is not. That is what I
    asked for; it is under the supplemental funding under the
    current level of operations that we have. As I said before, we
    have 11,000 people right now above our statutory end strength
    that are being paid for through the supplemental because of the
    level of operations. What I have asked for is to be able to
    target who we keep so we can form more units while we fund the
    offsets in personnel within our current authorization through
    our restructuring and other initiatives.
        Senator McCain. Which again, in all due respect, ends up
    with an increase of 30,000 personnel. Is that correct?
        General Schoomaker. Yes, sir. I asked to be able to grow to
    that level. We cannot achieve that level overnight. This is
    going to be incremental growth over that period.
        Senator McCain. But each year is it the intention to ask
    for the funding for this out of emergency supplemental funding?
        General Schoomaker. Sir, as long as we have this emergency,
    yes, in conjunction with what we have in our program. Obviously
    if the emergency terminates then we will have to terminate
    this, but this is why we built the off-ramps during the period
    of growth.
        Senator McCain. I guess my point is, Mr. Chairman, I have
    not known of personnel increases being paid for in the name of
    emergency supplementals to pay for a conflict. I think what it
    does is it increases the size of the deficit and again deceives
    the American people about the size of the deficit and the debt
    that we are incurring per household.
        General Jumper, are you aware that members of the Senate
    Armed Services Committee staff were given falsified information
    by the people at Tinker Air Force Base?
        General Jumper. No, sir, I am not.
        Senator McCain. You were not aware of this issue being
    discussed in an open hearing? Your liaison people did not
    inform you of our concern about that?
        General Jumper. No, sir, not about false statements. I have
    heard nothing about false statements.
        Senator McCain. I showed before the committee doctored
    documents that were given to the staff of this committee. You
    know nothing about that?
        General Jumper. I am sorry, sir; I do not.
        Senator McCain. General Hagee, do you need additional
    members of the Marine Corps to carry out your responsibilities?
        General Hagee. As I see the situation right now, no, sir.
        Senator McCain. You do not?
        General Hagee. I do not, sir.
        Senator McCain. Thank you.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator McCain.
        Senator McCain. I would like to have several questions
    submitted for the record.
        Chairman Warner. Without objection, all members are given
    that opportunity.
        You raised very important questions relative to the budget
    and the supplemental, as did Senator Levin. I wish to make it
    clear that, having been in the building myself for many years,
    these witnesses before us received guidance from the Secretary
    of Defense as to what to do. They did not make the decision not
    to include in their own budget process the cost for those
    personnel. I think we all agree on that. It is a level above
    them where that decision was made as to the allocation of the
    budget costs.
        Are we agreed on that, gentlemen?
        Senator Levin. I think that is usually true.
        Chairman Warner. Yes. They are responding to the actual
    facts, but the decision on the budget was made, frankly, by the
    Office of Management and Budget (OMB) and promulgated through
    the Secretary of Defense.
        Senator Levin. They could appeal it to the President, I
    guess, under Goldwater-Nichols.
        Chairman Warner. Senator Lieberman.
        Senator Levin. Good old Goldwater-Nichols.
        Senator Lieberman. Thank you, Mr. Chairman, and again
    thanks to the chiefs for being here.
        Mr. Chairman, there have been some references made and
    questions asked regarding the ongoing debate about the quality
    of our intelligence about WMD and the way in which the
    administration used that intelligence. Those are important
    questions. I think it is even more important that we focus, as
    I believe all of us want to do, and as Senator Levin mentioned
    in his opening statement, on how we support you and our forces
    to successfully complete the mission in Iraq. While the inquiry
    regarding WMD and the intelligence is significant certainly as
    we go forward, what is really important is to go forward.
        We are there now. We have successfully carried out what I
    have for more than a decade believed was a just and necessary
    mission, which was to overthrow Saddam Hussein. I have no
    doubt, thanks to the skill and bravery of your forces, that
    America and the world are safer as a result.
        Now the question is how to complete the next phase, which
    in some sense is a different mission. So my questions will
    focus on that. I, like everyone else, have been reading lately
    and hearing about Mr. Abu Mus'ab al-Zarqawi, a Jordanian
    thought to have links to al Qaeda. We now link him to a number
    of bombings in Iraq and now have found this disk with what
    looks like a request by him to the leadership of al Qaeda for
    support for what he called ``a secular war against the Shias.''
        I must say, parenthetically, I have always been struck by
    the conclusion that there was no link between al Qaeda and
    Saddam Hussein. How could there be a link, they say, because al
    Qaeda is theological and Saddam was very secular? I am not
    reaching a conclusion here, but I am just urging others not to
    reach a conclusion. Unfortunately, they had something that tied
    them together, which was their hatred of us.
        I now return to my question. The news about Zarqawi leads
    me to ask, how would you describe the insurgency we are facing
    now? Am I right in concluding it is a mix of Baathist
    loyalists, Saddam loyalists, and terrorists? Is that the
    conclusion you reach about the enemy we are facing in this
    phase of the conflict in Iraq? I will start with you, General
    Schoomaker, and then General Hagee.
        General Schoomaker. Sir, I think it has been best described
    as being a combination of former regime loyalists and dead-
    enders. There are certainly some criminal elements that are
    being paid to perform certain things by them, and obviously you
    have seen intelligence that there are other entities that are
    there.
        It appears from what has been in the open press today that
    there is a direction towards trying to work the seams between
    the different entities within the country to their advantage. I
    will pass the question to General Hagee.
        Senator Lieberman. As you advise the Secretary and equip
    and staff General Abizaid, I take it that you have no doubt
    that part of the element we are fighting in Iraq is terrorists.
    They are not just the Baathist loyalists, is that right,
    General?
        General Schoomaker. Yes, sir, I think that that is clear.
    The evidence is there. But terror is a tactic as well as a
    philosophy.
        Senator Lieberman. Right.
        General Schoomaker. I think that we nevertheless,
    regardless of what the source of it is, are seeing terror
    tactics used against us in this insurgency. The source of it
    from my perspective matters less from my area of
    responsibility, which is to protect and prepare our soldiers to
    perform over there. I would agree in that regard.
        Senator Lieberman. That is an important point and I accept
    it. There may be terrorist groups that have come in from
    outside, but the point is that from the point of view of your
    forces terrorism is terrorism. It could be the Baathists using
    terrorist means.
        General Hagee.
        General Hagee. Sir, I agree with that assessment.
        Senator Lieberman. Let me ask a more general question,
    which builds a little bit on questions that have been asked
    before. I will ask each of you this. Does the budget submitted
    by the administration give you the resources you need to fight
    the ongoing war against the insurgents in Iraq and conduct
    those essential military activities to win the peace as well as
    to be prepared to fight and win if necessary elsewhere in the
    world?
        Understanding that you can never have everything you want
    in a world of limited resources, what would be your top
    unfunded requirement if in fact you feel that you received as
    much of your priority list as you need in the administration's
    budget?
        General Schoomaker. Sir, I would have to submit that for
    the record. I would not like to guess at that at this stage. I
    would like to say that the 2004 budget with supplemental is
    sufficient to prepare us and to conduct the operations that we
    are doing today. What we have in the 2005 Army budget is
    sufficient to prepare and equip the Army to do the day-to-day
    things to support our preparation for the war. It does not
    include the contingency costs of actually operating over in
    that theater.
        Senator Lieberman. What you would like to submit in writing
    is what your top unfunded requirement would be. Did I
    understand that correctly?
        General Schoomaker. If you are asking me that question,
    that is the way I would prefer to answer it, yes, sir.
        [The information referred to follows:]

        The fiscal year 2005 budget supports our highest Army base program
    priorities. Should additional funds become available, we would apply
    them first to accelerate our force protection efforts, including
    ballistic armor protection and individual soldier equipment.

        Senator Lieberman. Fine.
        Admiral Clark.
        Admiral Clark. The demand on the Navy is certainly not the
    same as it is on the Army and the Marine Corps with regard to
    this specific fight. The requirement for us to be represented
    globally certainly is there. Thirty-two percent of my force is
    forward-deployed today. I have sufficient resources to execute
    that.
        Over the course of our discussion, I have talked on a
    consistent pattern about the requirement to make sure this
    force is ready. In my opening testimony I spoke to the value of
    readiness. I assure you that this budget has the resources in
    it to make sure that it is ready and I can respond this
    afternoon if I have to.
        With regard to my most pressing requirement--and you are
    exactly right, in a perfect world I could dream up some things
    that we could go faster. I fundamentally believe that one of
    the things that is costing us in the acquisition side of the
    house is that many of our programs--because of resources, we
    are not able to move fast enough, so we have them on a program
    on minimum sustain rate or do not invest as rapidly as we could
    which ends up costing the Nation more.
        But I will tell you that for me, the focus is now on how to
    create the Navy of the future. For too many years we did not
    buy enough ships and airplanes. That would be my most pressing
    need and that is where I would put additional resources: to
    recapitalize ships, aircraft, and submarines, in a more rapid
    manner.
        Senator Lieberman. Thanks, Admiral.
        I know I am over my time, Mr. Chairman. I wonder if we
    could just ask General Hagee and General Jumper to respond,
    please?
        Chairman Warner. Yes, of course.
        General Hagee. Sir, with the combination of the budget and
    the supplemental we can handle day-to-day operations and any
    other contingencies that come up. As far as the number one item
    on my list, it would be resetting the force, ensuring as we use
    the equipment either in Iraq or Afghanistan or wherever that we
    have sufficient funds to either purchase new equipment or to
    refurbish the equipment that is coming back.
        Senator Lieberman. Thank you.
        General Jumper.
        General Jumper. Sir, we also have the resources to do our
    job, and resetting the force quickly and being able to
    recapitalize, as Admiral Clark says, are the two priorities on
    the Air Force's list.
        Senator Lieberman. Thank you all for your testimony. Thanks
    for what you do for us and our country every day.
        Chairman Warner. We thank you, Senator Lieberman.
        Senator Dole.
        Senator Dole. Thank you, Mr. Chairman. I certainly want to
    thank the Service Chiefs for being here today, but I also want
    to thank you for the great work that you are doing in leading
    our young men and women in the military as they fight and
    battle terrorism both here at home and abroad. Thousands of
    young men and women in my home State of North Carolina are
    currently fighting the war on terror in Iraq. We are forging a
    process of peace and in doing so we are moving toward turning
    control of the government and society back to the Iraqi people.
        In Iraq and Afghanistan, our Nation is helping to rebuild
    schools and hospitals, water supply systems and roadways. We
    have made great progress, thanks to our diverse and skilled
    workforce, which is meeting the challenges with a courage that
    makes us all very proud indeed.
        With this month's deployment of North Carolina's 30th Heavy
    Enhanced Separate Brigade, I have been made painfully aware of
    some of the problems faced by the National Guard units as they
    mobilize. General Schoomaker, what are you doing to guarantee
    that the service members are expeditiously transitioned to
    active duty payrolls and that their lodging and subsistence are
    of the same quality as the active units that are training on
    the same bases?
        Would you respond to that, and then also to the budget
    request news release sent out by DOD which proposes, ``the use
    of innovative management to improve the mobilization process.''
    Could each of you go into more specifics about how your Service
    intends to meet that objective?
        General Schoomaker. Senator Dole, thank you very much. As I
    think you might know, I spent considerable time with the 30th
    Brigade, Old Hickory, all the way from its pre-mobilization
    through the mobilization process and through its most recent
    training at the Joint Readiness Training Center. We have pulled
    out all stops to ensure that they are absolutely prepared,
    equipped, trained, have all of the benefits, and to ensure that
    they have mission success.
        To answer the second part of your question, we are going to
    school on ourselves in preparation for mobilization. We are
    learning very much about what we are doing now and have been
    doing in mobilization. Both the Chief of the Army National
    Guard and the Chief of the Army Reserve are working with us to
    achieve the initiatives through modularity and a transition
    from what we used to call an ``alert, train, deploy'' mentality
    to a ``train, alert, deploy'' capability within our Reserve
    components.
        Senator Dole. Would others answer briefly, please.
        Admiral Clark. Very briefly, we have now only 1,900
    Reserves mobilized. Our problem and challenge is significantly
    different than the other Services. Suffice it to say that the
    main way we are taking this on, Senator, is this: We are
    rebalancing the active-Reserve mix so that we do not get caught
    in a position where if we have to go accomplish some mission,
    we are forced to have a lot of Reserves on day one. We have
    restructured our fast response force so that Reserves will not
    be required for at least the first 60 days of any operation we
    might be required to be involved in.
        General Schoomaker's comment about learning from ourselves
    is absolutely true. We continue to do that. The biggest area
    for us has been in pay. We have made great progress with the
    computer systems to support that.
        General Hagee. Senator, we are an expeditionary ready
    force. We have active duty personnel located with our Reserve
    units to ensure that their training meets the same standards as
    our Active-Duty Forces. We are ready to activate those
    individuals within an extremely short period of time to respond
    to any contingency.
        General Jumper. Senator, in the Air Force we train our Air
    National Guard and Air Force Reserve to the same standards as
    the active and they share the same equipment. We have a very
    high volunteer rate for our normal rotations in the Air Force,
    but we are configured with our Air Expeditionary Forces so that
    we can call forward the active portions of those forces as
    force packages as we need them if we want to avoid
    mobilization.
        Still, with our high volunteer rates we do not think that
    that is necessary in normal times.
        Senator Dole. General Jumper, I have an interest in the A-
    10 aircraft. This year's budget shows a significant procurement
    funding increase for the A-10. The A-10 certainly has shown its
    continued capabilities in Iraq, despite its status as an aging
    aircraft. Does the budget investment support your goal of
    extending the service life of this aircraft to 2028? Have
    recent operations further validated the use of other platforms,
    like the F-16 and the B-1, for the close air support mission?
        General Jumper. Well, Senator, especially since Kosovo and
    particularly into Afghanistan, we have worked close air support
    with every kind of airframe that we have. The most significant
    addition has been our bomber force. In many cases we have been
    able to provide close air support with greater accuracy with
    our GPS-guided bombs than we have actually being closer to the
    ground with some of our fighter aircraft.
        But our F-16s, our A-10s, and our bomber aircraft are all
    committed to that mission. We will continue to have, in the Air
    Force, dedicated airplanes whose sole mission is close air
    support like the A-10. As you say, we have a significant
    upgrade program. How this will play out into the future and how
    we work this with the aging aircraft problems with the A-10 is
    yet to be determined, but we will continue with dedicated close
    air support capability in our Air Force.
        Senator Dole. Thank you.
        My time has expired. Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator, for your
    contributions on these questions.
        Now, Senator Reed.
        Senator Reed. Thank you, Mr. Chairman.
        Gentlemen, thank you for your service to the Nation and
    your individual branches of the Service. My theme will be
    reminiscent of many that are here today. The most remarkable
    thing about this budget is what it leaves out, not what it
    includes. It leaves out the cost of operations in Iraq and
    Afghanistan, and the deliberate increases as a result of 30,000
    additional Army troops that were committed to.
        I think it is a deceptive way to finance the operations of
    the military and I think it also has practical ramifications.
    It impacts the Army most specifically and the Marine Corps to a
    similar degree.
        General Schoomaker, as I understand, the way we are
    financing operations today is that this budget proposal will
    cover the routine operations of the Army through the 2005 year,
    but operations in Afghanistan and Iraq and other contingencies
    are being funded out of the 2004 supplemental?
        General Schoomaker. That is correct, sir.
        Senator Reed. At the current burn rate, when do you run out
    of 2004 supplemental money? What day or month?
        General Schoomaker. Sir, we are funded through the end of
    this year. At the burn rate, we are funded through the end of
    the fiscal year.
        Senator Reed. You are funded until September 30?
        General Schoomaker. Until 30 September, yes, sir.
        Senator Reed. The 30th. If this supplemental is delayed
    past September 30, say the end of November, or even delayed
    until the following year, which is customary nowadays, you will
    burn out all the money that is appropriated?
        General Schoomaker. That is correct, sir.
        Senator Reed. In trying to balance the commitments and the
    demands, do you anticipate cutting down base support operations
    as a way to cover shortfalls?
        General Schoomaker. Sir, quite frankly I only have
    visibility of what the Army has. I do not know what OSD has
    available. I am concerned, and I think this is what you are
    getting to, on how we bridge the gap between the end of this
    fiscal year and whenever we can get a supplemental in the next
    year. I do not have an answer for you exactly how we would do
    that.
        Senator Reed. Thank you, General.
        Admiral Clark, do you have similar concerns?
        Admiral Clark. I do not, because I do not have that kind of
    surge requirement at this time. If I had to increase the pace
    of aviation operations, then I would need additional resources.
    I will end up being the party that pays for the Marine Corps
    transportation and that is a small amount that we will have to
    deal with. We expect to be covered out of the 2004 supplemental
    for this movement and then next year we will have to deal with
    when they would be coming home.
        Senator Reed. General Hagee, your comments?
        General Hagee. Sir, I share the Chief of Staff of the
    Army's concerns about this.
        Senator Reed. General Jumper?
        General Jumper. Sir, so do I. We are funded through the end
    of fiscal year 2004 and then we will have to either cash flow
    or find a way to bridge until any potential supplement in 2005.
        Senator Reed. So if we do not see a supplemental up here in
    the middle of the summer, given the way we work, you gentlemen
    in varying degrees are facing a funding problem beginning
    September, or beginning October 1. Is that a fair assumption?
        General Schoomaker. Yes, sir.
        Senator Reed. Admiral Clark, except for the Navy?
        Admiral Clark. Based on what I said last time, I do not
    have any requirements that I know of at this time, but I might
    have a small transportation requirement.
        Senator Reed. General Hagee.
        General Hagee. Yes, sir, we will have a challenge during
    that first quarter. We would take actions like General Jumper
    mentioned: forward flowing or cash flowing until the
    supplemental became available.
        Senator Reed. Let me ask another related question. This
    goes against the Army because they are bearing so much of this
    burden and bearing it extremely well, General. The Secretary of
    Defense had a chart at the last hearing which he is going to
    use to talk about the end strength increases. What I find
    remarkable is that from September 2003 to December 2003 the
    Army lost 10,000 soldiers at a time that stop-losses were in
    place, and at a time that we were contemplating at least
    increasing the number of soldiers.
        I am concerned that this trend, if it continues, will be
    serious in terms of manning the forces, regardless of whatever
    end strength and by whatever means we achieve, coupled together
    with the anticipation in July when OIF 1 finishes of
    significant recruitment problems and retention problems. Could
    you comment upon that, General Schoomaker?
        General Schoomaker. I am not familiar with the chart you
    just held up and I do not know about losing 10,000 soldiers.
        Senator Reed. This is the Secretary of Defense's chart,
    with the end strength of the actual Army. They show in
    September 2003 499,301, and in December, 490,174. This is a
    loss of about 10,000 personnel in end strength. That is his
    chart.
        General Schoomaker. Sir, our statutory end strength at the
    end of last year was 480,000.
        Senator Reed. I am probably being confusing. The numbers I
    refer to is the actual end strength, not the statutory.
        General Schoomaker. That is temporary end strength, that
    has grown within their authority, and within the authority of
    the Secretary of Defense.
        Senator Reed. I am not questioning the legality. It appears
    to me that we lost 10,000 soldiers, real boots on the ground,
    at a time we had stop-loss orders in effect, and at a time in
    which we were trying to begin our recruitment for these
    additional soldiers.
        General Schoomaker. Sir, they are not related. That is what
    I am trying to tell you. We have met our retention and
    recruiting goals at 100 percent of the force. The force waxes
    and wanes based upon who we are mobilizing, and who we are
    moving, and it has been as high as twice that number during
    part of the year.
        Senator Reed. If you could provide me a more specific
    written response----
        General Schoomaker. Yes, sir, I will.
        [The information referred to follows:]

        The drop in end strength is directly attributable to traditionally
    low enlisted accessions in December and the end of the active
    component, 12-month skill-based stop loss/stop move program.
    Historically, the active Army does not bring many new soldiers onto
    active duty during the holiday season. Thus, each year, strength dips a
    few thousand in December and recovers in January. In the summer of
    fiscal year 2003, the Army terminated the skill-based stop loss/stop
    move program. The termination plan provided for most solders who were
    subject to stop loss to depart the active Army between October 31, 2003
    and December 20, 2003. Approximately 8,000 soldiers chose to depart
    during that time. A new stop loss policy began in January 2004, and
    only affects soldiers in deploying units. It will not be based on a
    soldier's military occupational specialty. With the implementation of
    unit stop loss and a return to accessing new soldiers in January, all
    factors indicate a steady increase in strength into the summer months.

        Senator Reed. I will provide more specific questions
    perhaps.
        If you just look at the lines here, we are increasing
    actual end strength month by month though last year. We hit a
    peak in December of last year and we started going down. If the
    next report for January, February, and March shows continued
    deterioration in actual end strength, I think it undercuts your
    ability to conduct your mission and it raises a serious
    problem. I will just stop there.
        General Schoomaker. Yes, sir.
        Senator Reed. Thank you, Mr. Chairman.
        Chairman Warner. Senator Allard.
        Senator Allard. Thank you, Mr. Chairman. I have a brief
    statement I would like to have included in the record just
    prior to my questioning.
        Chairman Warner. The statement will be put into the record.
        [The prepared statement of Senator Allard follows:]
                   Prepared Statement by Senator Wayne Allard
        Thank you, Mr. Chairman. I want to express my appreciation to each
    of you for your leadership and dedication. A year ago, our Nation was
    demanding much of our military. Our forces were fighting in
    Afghanistan, assisting local forces in Yemen, Djibouti, and Georgia,
    and defending our homeland. Since then, they have taken on a new
    mission: the securing and stabilization of Iraq. The mobilization of
    thousands of men and women in the Reserves and National Guard are
    indicative of the size and scope of our current military operations.
    Despite many hardships, our soldiers, sailors, airmen, marines, and
    coast guardsmen have stepped forward and embraced their country's call
    to arms. We thank them for their service. We thank each of you for
    providing them with the leadership they need to defend our Nation.
        Even as we confront our foes around the world today, we must
    prepare to meet the threats of tomorrow. The ongoing transformation of
    the military is vital to the future safety and security of this great
    Nation. We must not avoid making difficult choices about legacy
    systems. Nor should we turn away from the cost of investing in new
    technologies. We must remain committed to this effort. The superiority
    of American arms in the decades to come is at stake.
        I want to thank our witnesses for taking the time to appear before
    us today. I know each of you have many responsibilities, particularly
    during this time of conflict. Yet, it is important for us to hear from
    you the needs of the men and women under your command. So, I again
    thank you for being here.
        Thank you, Mr. Chairman. I look forward to our time of questions.

        Senator Allard. Just recently, I went to a Board of
    Visitors meeting, which is advisory to the Superintendent of
    the Air Force Academy (AFA), and I want to take this
    opportunity to thank General Jumper as well as Secretary of the
    Air Force Roche for attending the last two Board of Visitors
    meetings. I know they are very busy individuals and their
    commitment to the future leaders of the Air Force is very much
    appreciated.
        I would also add that this last meeting was probably the
    best Board of Visitors meeting I have had the chance to attend
    in the 6 years that I have been on the Board. We are under new
    leadership with Jim Gilmore, who is our chairman, and both the
    Superintendent of the AFA, General Rosa, as well as the
    Commandant, General Weida. They gave good reports and I think
    most generally, in talking with the members of the Board, they
    felt that considerable progress had been made at the AFA as far
    as addressing this problem with sexual assaults that they have
    just been dealing with for the last year or so.
        I would ask General Jumper, who was there and listened, if
    he might share with this committee his assessment of where we
    are with sexual assault issues there at the AFA and how the
    plan is moving forward.
        General Jumper. Thank you, Senator. I appreciate your
    efforts, sir, to reinvigorate the Board of Visitors and to get
    the members interested in what is going on out there. You and
    Chairman Gilmore have done a superb job of that and I think
    that is what made the meeting such a success.
        Senator, there is a great deal that has gone on as we
    implement the provisions of the Fowler Commission report. We
    have about 80 percent of those recommendations implemented at
    the AFA. The actions that you and the Board of Visitors took at
    the last meeting went a long way in implementing many of the
    rest of those provisions. As we have looked at the agenda for
    change at the AFA, I think we have seen an excellent response,
    especially with regard to the use of alcohol among the cadets.
    The number of incidents have gone down dramatically. We do not
    declare success on that. We just take it as a trend.
        The number of sexual assault incidents that have been
    reported since the new leadership has been in place is 10.
    Those are being dealt with. The issue that we are consumed with
    right now, that I know Senator Collins is worried about, is the
    issue of confidentiality and actually how we implement
    something that allows some element of confidentiality. We are
    working on that right now with the DOD Inspector General to try
    and find a way to accommodate all the concerns surrounding
    that.
        I think from the alcohol uses, to the reporting, to the
    response team measures that we have put in at the AFA, I think
    that the attitude that I see when I go out there is positive.
    Senator, I visit often and I randomly go around and talk to the
    cadets, as does Secretary Roche. I see a recognition of the
    problem. I see less and less denial and a determination to get
    on with fixing the elements of this problem.
        We will continue to press forward with all energy, Senator,
    to get through this thing.
        Senator Allard. Thank you, General Jumper.
        General Schoomaker, the President's fiscal year 2005 budget
    request provides over $1.4 billion for the DOD's chemical
    demilitarization program. You have a major role in that, or the
    Army has a major role in it. I was looking at the budget
    request and how the Government Performance and Results Act
    (GPRA), which is a provision that has been put in place by
    Congress for agencies to measure the progress and results of
    their programs, received the lowest rating as far as measuring
    results.
        It does not necessarily reflect funding, but there are also
    some problems with cost overruns and some other problems. I
    wonder if you would just share with me about the funding and
    some of the evaluations of that program. The bottom line
    question is are we going to be able to meet the 2012 treaty
    deadline for the Army's chemical demilitarization program?
        General Schoomaker. Sir, I know that Acting Secretary of
    the Army Brownlee is personally involved in running this issue.
    I am not as familiar with it and I would be glad to provide for
    the record the information.
        [The information referred to follows:]

        The Army remains committed to safely and efficiently meeting treaty
    deadlines.

        Senator Allard. Yes, I wish you would do that, because the
    GPRA measurement on that means that you are setting goals and
    objectives and you are not meeting them. I am concerned about
    that. Could you give this to me and perhaps maybe the rest of
    the members of the committee who are interested in knowing what
    is happening?
        General Schoomaker. I would be glad to.
        Senator Allard. I am particularly concerned about the cost
    overruns and everything that we are hearing about in that
    particular program. I think that is an area of concern and
    something that we need to watch.
        I have another question for you. The Denver Post reported 3
    weeks ago that as many as 40 women have been sexually assaulted
    while serving our country in Iraq. Then The Washington Post
    wrote an article and then USA Today wrote an editorial on that.
    As a result, Secretary Rumsfeld ordered a comprehensive
    investigation into the matter.
        Is the Army addressing the problem of sexual misconduct
    when soldiers are deployed?
        General Schoomaker. Would you say the last part of your
    question again?
        Senator Allard. Are you addressing this problem in the
    Army?
        General Schoomaker. Yes, sir, we are. We are addressing it
    very aggressively. This has been a subject that has received
    leadership attention. It is a chain of command issue. It is a
    leadership issue. It is a discipline issue. We have significant
    resources available to us to handle it and we are reviewing
    those in regard to much of what General Jumper just spoke to.
        Senator Allard. Back to you, General Jumper. Last November
    the Armed Services Subcommittee on Strategic Forces, which I
    chair, held a hearing on the current status of many of our
    military space programs. It was noted that many of these
    programs had fallen behind schedule, experienced enormous cost
    overruns, and they may not be appropriately managed.
        I believe that we cannot allow our military space programs
    to continue down this path, which could eventually threaten our
    space dominance. I believe that we need to seriously examine
    the size and type of satellites that we are building and I
    believe our launch capabilities need to be much more responsive
    and much more affordable.
        General Jumper, given that the cost of building a few
    large, highly capable satellites is becoming prohibitively
    expensive, do you believe it is time for us to begin examining
    the possibility of building large quantities of smaller, less
    capable satellites that together provide the same overall
    capability?
        General Jumper. Senator, I can tell you that Pete Teets,
    who is the Space Executive for OSD and the Under Secretary of
    the Air Force, is focused on the ability of our space industry
    to perform. It has to do with a number of things, not the least
    of which is getting our arms around the requirements.
        It has long been a practice in the space industry that
    requirements can come from all directions and that they are
    perhaps not properly constrained. We are taking aggressive
    action to get hold of the requirements.
        Certainly one of the things that has to be looked at is the
    size and complexity of the satellites. There is a large effort
    going on with the development of microsat technology and what
    it might be able to do for us, especially as we look at being
    able to focus on specific areas. I take your point, sir, and I
    know that Mr. Teets is looking at that and I think that is
    probably one of the alternatives to the way we are going now.
        Chairman Warner. Thank you very much, Senator. We are past
    the time.
        Senator Allard. Thank you. Sorry, I did not realize.
        Chairman Warner. Not at all.
        Senator Allard. Thank you, Mr. Chairman.
        Chairman Warner. It is a very important question.
        Senator Pryor.
        Senator Pryor. Thank you, Mr. Chairman.
        Admiral Clark, I was interested in a comment you made about
    moving the Navy to more technically advanced ships.
        We are moving toward much more technically advanced ships.
    I am curious about that. In a sense, are you saying that we are
    going to have fewer and fewer tasks that, say, an E-1 can
    perform on those ships and more and more tasks on those ships
    that E-6s will perform? How will that work?
        Admiral Clark. You have it exactly. The technology that we
    are inserting in our new platforms is going to require a more
    experienced, call it a richer experienced, force. I said in my
    opening testimony that our asymmetric advantages are technology
    and the genius of our people, and I want all of it I can get.
        DD(X) starts construction in 2005. DD(X) will be an all-
    electric ship. It will have the ability to project fires 100
    miles. It will revolutionize naval fires. Today we can do it at
    around 10. This will change the way we fight with the Marine
    Corps, and it will change the way we support Army units on the
    ground.
        A typical ship today that size maybe would have 500 or 600
    people on it. This one is going to have between 100 and 150
    people on it. No, I do not anticipate that there are going to
    be many E-1s there. It is going to require a very experienced
    group of people to operate this ship.
        This is why I need all of the incentive tools to shape the
    force, and it is why I am one chief that is talking about a
    force that is much more capable but with fewer people in it.
        Senator Pryor. Right. I assume for budgetary reasons there
    will be fewer people with a higher pay scale, is that right?
    But does that wash out in the end in terms of----
        Admiral Clark. Well, it absolutely is shaped differently.
    For 4 years, I have been coming up here talking about making my
    force richer and experienced. When I got here, the top six,
    that is E-4 through 9, were 69.9 percent of my force. In 2004
    it goes to 73.3, and in this budget it goes to 74 percent of my
    force.
        You cannot change this overnight and we have been
    progressively growing the experience in the force. It provides
    more opportunity for our people, but also sends them the
    message: We need you, we need your skill set, and this is what
    the Navy is going to be like in the future.
        Senator Pryor. Let me ask this in light of that, and I
    follow what you are saying completely. I recently received a
    letter from a constituent from my State of Arkansas and I
    believe he is stationed in Japan. Under the high-tenure system,
    it sounds like he is about to be forced to retire. He is an E-
    6. I do not know all of his background, and do not know a lot
    about him, but I do have his letter right here.
        I wonder if we should reevaluate our high-tenure system in
    light of what you just said, that there may be some people that
    maybe do not go up their promotion chain, but are awfully good
    at what they do. We should keep those people for a longer
    period of time. Does that make sense?
        Admiral Clark. That absolutely makes sense. As CNO, one of
    the things I get to do is put policies in place. In order to
    shape the manpower force, I put policies in place that put a
    limit on an individual that has served for a number of years
    and has not been promoted, in order to then make room for a
    hard charger that has the potential to serve much longer in the
    future. I put rules in on how long they can serve without being
    promoted.
        Having said that, every individual is an individual, and I
    have waiver clauses on every one of those policies. That option
    is always open and we assess each case as required to meet the
    needs of the current and future naval service.
        Senator Pryor. Yes, because, based on what you said a few
    moments ago, it seems like you want preferably more tenured
    people, more experienced people, and fewer of them per ship. I
    understand that. I did not want to point out an inconsistency,
    but I just did not know how that worked.
        General Schoomaker, let me ask you a question about this
    huge rotation that you are undergoing right now in Iraq. I
    think you are moving out 125,000, and moving in 110,000, if I
    understand the numbers correctly. Could you just give us a
    status report on that rotation?
        General Schoomaker. Sir, the rotation is on schedule and
    moving very well in every aspect, from the transportation plan
    to the transfers authority in the theaters.
        Senator Pryor. We are right on the timetable?
        General Schoomaker. We are doing very well, yes, sir.
        Senator Pryor. Are there any hidden or maybe unexpected
    costs that you had not anticipated? Are the costs of the
    rotation tracking your schedule?
        General Schoomaker. I am aware of nothing that is different
    in that regard.
        Senator Pryor. Let me also ask this, General Schoomaker.
    Since I have been on this committee, which has been just over a
    year now, we have heard a lot about transformation. What is the
    most significant development or developments in transformation
    in this budget that we are talking about today? What should we
    see in the Army over this fiscal year, that we as a committee
    can look to and track and follow the transformation process?
        General Schoomaker. Sir, it would take the rest of the
    hearing for me to lay it all out. We are going to come over and
    provide exquisite detail to every member and every staff member
    that would like to see what we are doing. In short,
    modularizing the force, increasing the number of modules, and
    putting enablers in that cause these modules to be much more
    powerful than they are today. This changes the doctrine to look
    much more like the doctrine of the future, not the doctrine of
    the past. Using this momentum, as a result of the war and the
    focus and the level of funding, we have to reset for tomorrow,
    not reset for yesterday.
        You will see three new brigades this year, at least three
    new brigades next year, and four brigades the following year.
    We will increase the Active Force by 30 percent with a minimal
    cost to our program.
        If you take a look at the National Guard, Lieutenant
    General Blum is building towards 34 brigades that look exactly
    like the kinds of brigades that we have. If we go all the way
    to the end of what we can do, we could end up potentially with
    82 brigades in the United States Army. That means that the
    dwell time issues, the kinds of pressures that are on the Guard
    and Reserve and the Active Force, can be reduced. The force is
    also stabilized so that people stay longer in one place, kids
    go to the same schools, spouses work, and people can invest in
    homes and develop equity like other people do. All of these
    kinds of things are all part of this transformation.
        Transformation is not just equipment. It is about the full
    dimension of the doctrine.
        Chairman Warner. Thank you very much, Senator, General.
        Senator Collins.
        Senator Collins. Thank you, Mr. Chairman.
        General Schoomaker, last Saturday I had the great privilege
    of participating in a welcome back ceremony for 24 soldiers
    from the Maine National Guard who were returning from
    Afghanistan. I would note that Maine has the third highest
    percentage of guardsmen and women being deployed right now in
    the entire Nation.
        Last week Secretary Rumsfeld suggested to us that the Guard
    is not overstressed and he provided us with a chart that showed
    that only 7 percent of our Guard have been mobilized more than
    once during the past 10 years. That does not reflect the
    experience of my Guard units in Maine at all. Many of them have
    been deployed three times in the last 10 years. Some were
    mobilized with only 5 days notice. Many of them had no idea how
    long they were going to be gone nor when they would return.
        I want to emphasize that the members of the Maine Guard are
    very proud of their service and they do a fabulous job, but
    repeated deployment over a 10-year period, 3 times in 10 years,
    has imposed a tremendous strain on their families. I am
    reminded of the old saying that you recruit the soldier, but
    you retain the family. I think, as Senator McCain and others
    have suggested, that we are going to see an exodus from the
    Guard and Reserves that is going to be very harmful because of
    these repeated deployments.
        I have two questions for you. First, how are you going to
    restructure the Guard units so that you spread the burden more
    evenly? My units are clearly in this 7 percent. Second, will
    the additional 30,000 active duty troops that you are
    requesting help relieve some of the excessive pressure on these
    overused Guard units?
        General Schoomaker. Senator, thank you very much for your
    question and thank you for the service of your constituents. We
    are very proud of them. While you were meeting them I was down
    in Senator Pryor's State with 400 Guard commanders and command
    sergeant majors from across the whole United States working on
    exactly what you are talking about.
        This is not an issue of how many people as much as it is
    what capabilities and how many units of capability we have
    available to us. The overstressed people that we have in the
    Guard and Reserve and the Active Force are in specialties that
    have high demand of which we have too few of them. So much of
    our transformational activity is balancing lesser used
    capability within our force into the more highly used
    capabilities within our force, so we can reduce that stress.
        I would like to refer to the rain barrel analogy that the
    Secretary of Defense used the other day. I used it with him but
    he beat me up a little bit when I first used it. Apparently he
    liked it because he used it with you. The problem is we are
    paying for a full barrel of rain water here. I would prefer to
    call it maybe whiskey, but we had to go with rain water. The
    spigot is too high up on the side of the barrel and we are not
    able to assess all of that liquid that is in the bottom of that
    barrel.
        What we want to do is move that spigot down by creating
    more of the low-density units and take the units we have too
    many of that we do not use enough and convert them and balance
    them across the Active, Guard, and Reserve Force structure. It
    is essential. To do this we have to have some room, and thus
    the temporary bump. That buys us the ability to start doing it
    now, because the faster we can create more of these brigades
    that look like each other in other capabilities the faster we
    will be able to relieve the stress on the force. That kind of
    pulls it together.
        Because of this rebalancing that we do, that temporary
    strength goes away and the units remain when it is over.
        Senator Collins. Thank you.
        Admiral Clark, you did not think you were going to get off
    scot-free today when I am here. I am going to submit several
    questions to you about shipbuilding, but I want to bring up a
    different issue today with you. A few months ago I also
    welcomed back to Brunswick Naval Air Station a squadron of P-3
    pilots and crews who had been assigned overseas to provide
    support in both our operations in Afghanistan and in Iraq.
        Could you comment on the role of the P-3 aircraft in OEF
    and OIF and what you see as the future for our marine patrol
    aircraft?
        Admiral Clark. Absolutely, and thank you for asking the
    question. This is a group of people who everybody really needs
    to know about for what they have been doing for America. This
    airplane, which was designed over 30 years ago, actually
    probably 40 years ago, was designed to go hunt submarines.
        It is a classic example of what happens in America when you
    apply the genius of our people and you keep introducing new
    systems. Over time we have put better and better sensors on
    this airplane, which was designed to do reconnaissance, and
    sometimes even underwater reconnaissance. In OIF, I will tell
    you that they operated principally in support of the land
    forces. We operated them at an extraordinary rate.
        These airplanes are wearing out. In fact, I took a proposal
    to the Secretary of Defense recently and said that I cannot
    keep flying them at this rate. The rate that we are flying them
    at today will not meet the transition for the new airplane that
    we have in this year's budget, the R&D for, the multimission
    maritime aircraft (MMA). We cannot get to the transition
    without limiting the flight hours on this airframe.
        These people have done a fabulous job and it is our task to
    husband this resource, use it where the Nation must use it in
    order to deal with the global war on terrorism and the
    challenges that we face. The men and women flying in these old
    airplanes are doing a magnificent job.
        Senator Collins. Thank you.
        Chairman Warner. Thank you, Senator, very much.
        Senator Akaka.
        Senator Akaka. Thank you very much, Mr. Chairman.
        I want to express how proud I am of our troops and the
    efforts they are making in keeping our Nation secure, and also
    of the great military leadership that we have had.
        General Schoomaker, I understand that the Army is
    attempting to reset your prepositioned stocks. General Hagee,
    your statement suggests that this task is already largely
    accomplished for the Marine Corps. However, I believe both of
    your Services are also continuing to use at least some portion
    of those stocks in support of ongoing operations in Iraq. I
    have two questions.
        First, what is the current status of your prepositioned
    stocks, and how much do you plan to continue to draw on them
    during OIF 2? Second, based on those answers, how long will it
    take you to reset your prepositioned equipment, how much
    supplemental funding will it require, and what is the impact on
    your ability to respond to other missions in the meantime?
    Thank you.
        General Schoomaker. Senator, thank you for the question.
    The most heavily used prepositioned stocks are those that are
    actually in Kuwait right now, the ones that we used for the
    war. The 3rd Infantry Division, for instance, deployed from
    Fort Stewart and Fort Benning, fell in on those prepositioned
    stocks and that is what they used to fight the war.
        We have something like 9,000 pieces of equipment in those
    prepositioned stocks that require resetting. This will take us
    a couple years to do. Most of this equipment is the equipment
    that was used for the phase one-two operations, or the battle
    operations. We are not using them today, so we are starting to
    reset the equipment.
        The equipment that we have sent into theater for current
    operations, primarily HMMWV and other wheeled vehicle forces,
    is different. I think the one that is most used right now is
    the one that is in Kuwait. We are resetting it. Others are
    intact and available to us for worldwide commitment.
        Senator Akaka. General Hagee.
        General Hagee. Yes, sir. I may have not been quite clear.
    We are resetting the force right now. We are in the midst of
    accomplishing that. We have not completed the refurbishment of
    our three maritime prepositioning squadrons. We have one that
    is essentially complete and ready to respond to any
    contingency. We have several ships in the two other squadrons
    that are complete.
        The remaining ships are either providing equipment to our
    forces in Iraq, the forces that are getting ready to flow in,
    or are in the process of being refurbished right now. How long
    it will take until we have all three squadrons back up will be
    a function of how long we will have to use the equipment there
    in Iraq. We are going to be working on this for a couple more
    years to come.
        Senator Akaka. General Schoomaker, your statement makes
    clear the need for all soldiers, regardless of their specialty,
    to be able to engage in combat missions. This guidance, the
    wisdom of which continues to be made abundantly clear in Iraq,
    seems to imply the need for additional training, especially on
    small arms. I know that the Army has for some time had a
    shortfall in ammunition. The direction you are heading in would
    indicate that shortages are likely to increase. If it is not
    classified, what is the current size and cost of your
    ammunition shortfall and what are your plans to address it?
        General Schoomaker. Sir, let me start with the last part of
    your question first and if it does not answer your question I
    will provide the rest for the record. I have asked them to take
    a look at opening another facility for small arms production
    this year. We are in the process of doing that right now.
        You are correct, we are stressed in the small arms area,
    have been for quite a while, and I am concerned about it. The
    need to train all soldiers to a higher level, especially the
    combat support and combat service support soldiers, to do live
    fire convoy protection against ambushes, and to improve their
    proficiency in individual arms, puts additional strain on our
    small arms ammunition budget. We are doing that training right
    now. We are proceeding and I am told that we are okay in terms
    of having the ammunition available today to do that.
        But I know if we fire at this rate that we are going to
    have to produce ammunition more in the future, so now is the
    time to facilitize in order to enable that.
        I think it will cost between $30 and $40 million to create
    another facility to do this. Right now the Army has one small
    arms ammunition manufacturing facility.
        Senator Akaka. General Schoomaker, your statement
    emphasizes the Army's need to continue its efforts in leader
    development and states that you will ensure that leaders get
    ``the right mix of operational assignments and training and
    education opportunities for now and in the future.''
        I am wondering how your initiative to extend the length of
    time that soldiers stay at a given post to up to 6 or 7 years
    interacts with your leader development goals, especially at
    posts that have a small number of units or that have very
    similar type units. Can you explain how soldiers at small or
    homogeneous posts will get multiple assignments that will
    advance their leadership skills over a 7-year period?
        General Schoomaker. Yes, sir. Obviously we have to look at
    the larger posts as being the ones that are the easiest at
    which to do this. Take Fort Hood, Texas, for example. With two
    divisions there, you have the ability to professionally develop
    in an operational setting much easier than you do on some of
    the outlying ones.
        In some cases we are going to have to look regionally to be
    able to do the things that we want to do with some of the
    smaller places. Our commitment to the professional military
    education piece, however, remains the same and we are working
    the whole process right now. I quite frankly do not see that we
    will have a problem maintaining the institutional training side
    such as schools and education.
        We need to ask ourselves the opposite question than we have
    always asked. The question ought to be, ``Why are we moving
    this soldier?'' If the answer is good then we will move that
    soldier. If the answer is, ``well, because he or she has been
    here 2 or 3 years and it is time to move,'' I do not think that
    cuts the mustard. As long as we can continue to develop the
    soldier and provide cohesion in the unit that soldier and his
    or her family should stay.
        I think we are going to find an overwhelming number of
    cases in which we do not have to move soldiers. Every soldier
    we do not move is a soldier in the force. We have an average of
    63,000 soldiers every day in motion that are not in units. By
    stabilizing this Army, I can certainly get 8 to 10,000 soldiers
    manning brigades. That is part of what we have to do. That is
    part of what we are doing inside of this temporary 30,000 that
    we are talking about. We are finding those people and getting
    them to the units so that we can bring down that temporary
    piece of it.
        I am sorry for such a long answer, but it is an extremely
    complicated process that will make this Army better in the
    future than it was before we went into this.
        Chairman Warner. Thank you very much, Senator, for your
    questions.
        Senator Akaka. Mr. Chairman, thank you very much.
        Chairman Warner. Senator Chambliss.
        Senator Chambliss. Thank you, Mr. Chairman.
        General Hagee, I was pleased to see your comments in your
    written statement relative to the purchase of Blount Island and
    what an asset that has been to the Marine Corps. I think that
    the peacetime mission as well as the wartime mission at Blount
    Island is going to be an even greater asset to the Marine Corps
    in the future.
        I was going to ask you about the armor plating of the
    HMMWVs and the tactical trucks, but you responded to Senator
    Warner's question and mentioned that. I am very proud of the
    work that the folks at the Marine Corps Logistics Base (MCLB)
    in Albany have done there and I am glad to hear that the
    leadership as well as the men and women in theater have a great
    appreciation for the improvement of those systems.
        General Schoomaker, I want to go back to Senator Allard's
    question to you relative to these allegations of sexual assault
    in Iraq and Kuwait. I know this is not isolated to Iraq and
    Kuwait. It is not isolated to the Army. These are the latest
    allegations that have come forth. You mentioned that this is a
    chain of command issue. I want to make sure that you are
    comfortable with the fact that the chain of command is
    operating to the extent that you as Chief of Staff of the Army
    are getting information directly from the ground on what is
    happening with respect to these allegations. I want to make
    sure that you have a procedure in place that is not just
    adequate, but a procedure in place that is working to allow the
    allegations of this nature to be brought forth in the proper
    and sensitive respect that it should be brought forth, and that
    these allegations are being handled in a very professional
    manner and that justice is being meted out.
        Are you comfortable that that is being done?
        General Schoomaker. Sir, I am comfortable that we have the
    resources and the procedures and the regulations and the
    training and everything else that is required. You are hitting
    on the most important part and that is compliance with all of
    this. That is why the Acting Secretary of the Army and I are
    personally involved and we are energized to make sure that we
    are complying. We have a task force that the Acting Secretary
    set up to look into this, to make sure that we are in
    compliance, and to find out why in each case that we find
    ourselves not in compliance, why we are not.
        I will tell you, this goes back to the chain of command and
    discipline. It goes back to things that are fundamental, and we
    need that to address that and fix it. Unfortunately, we are not
    aware of all of these allegations, what Senator Allard was
    talking about there regarding those numbers. We are not aware
    of each and every one of those, so I do not know what the
    magnitude of what his figures are. We are on top of this and
    will continue to do it. This extends into our military academy.
        Senator Chambliss. That is an issue that the Personnel
    Subcommittee, if not the full committee, Mr. Chairman, is going
    to be following very closely because it is critically important
    to you, I know, and certainly to us and to all members of each
    branch of the service.
        General Schoomaker. Sir, I would add that, since I have a
    daughter going into the Army, that I have a personal interest
    in making sure.
        Senator Chambliss. Well, I know you are concerned, but I
    just want to make sure it gets the profile that it needs to be
    attended to.
        General Jumper, I appreciate your comment about the work
    that the blended wing is doing at Robins. Now Brigadier General
    Lynn is commanding the first blended wing that I think is going
    to be the precedent for every branch of the Service in the
    future relative to the integration of the Guard and Reserve
    into the Active Force. Those men and women down there continue
    to do a terrific job and I am just as proud of them as you are.
        I want to talk with you for a minute about strategic
    airlift. You talked about the C-17 and the great work that it
    is doing, has done, and continues to do in theater. I agree
    with that, and strategic airlift has been absolutely central to
    our success in both Afghanistan and Iraq over the past 3 years.
    It has also been central to the success of the expeditionary
    Air Force for much longer than that.
        Now, you are currently in the process of revising the
    mobility requirements study to incorporate lessons learned in
    OIF and OEF, and I understand this study is going to be
    complete by June 2005. However, I do not think it takes a
    complex, time-consuming study to determine that we simply do
    not have enough airlift. We cannot build enough C-17s, or
    modify enough C-5s fast enough to produce the amount of airlift
    capability that we need.
        One illustration of this, which I find a little troubling,
    is that 125 times over the last 3 years DOD has contracted with
    the Russians to use An-124 aircraft for strategic airlift
    because we simply did not have enough of our own. At the same
    time, DOD and the Air Force seem to be dragging their feet on
    funding C-5 modernization programs which could help alleviate
    our need to contract with the Russians.
        I would appreciate your comments on this situation as well
    as your comments on how you will fund the C-5 modernization
    effort in order to increase our strategic airlift capacity.
        General Jumper. Yes, sir, Senator, and thank you for that
    question. The global mobility forces that are out there working
    every day are indeed the key to our ability to reach out around
    the world. The current mobility study has put the requirement
    at 54.5 million ton-miles per day. That is the number that we
    are challenging and we are looking and looking again to see if
    that is the right measure or if we need to rethink it
    completely in this contingency world that we live in.
        In order to get to that number, we were on the track that
    got us to some number of C-17s plus a re-engined and re-
    engineered C-5. Part of our work with the C-5s is to see how
    many of the C-5s that are currently in the inventory are
    capable of being modified. Do they have service life left? Have
    they been overworked? That work is ongoing and as part of the
    study that is due in the summer of 2005 we will then be able to
    put those together and come up with an answer on the right
    combination of C-17s and C-5s modified to be able to meet the
    requirement.
        That work is ongoing. It is on the front burner. We have
    made some adjustments in the funding of the C-5 to move from
    the Reliability and Enhancement and Re-engining Program (RERP)
    to the avionics modernization program in the C-5 so we can keep
    more of those compatible with the current Federal Aviation
    Administration (FAA) and international regulations. But I can
    assure you, Senator, this is an area of concern for us and we
    are going to keep pushing this.
        Chairman Warner. Thank you very much, General, and thank
    you for raising the questions about the sexual assault. Sexual
    assault is a primary concern to this full committee.
        Senator Clinton.
        Senator Clinton. Thank you, Mr. Chairman, and thanks to all
    of you for the work you do every day and for once again coming
    to appear before this committee.
        General Schoomaker, I am equally concerned along with
    Senators Chambliss and Allard on the investigation into the
    allegations of sexual assault and misconduct. Will you be
    sharing the results of the investigation with this committee at
    some future date?
        General Schoomaker. Senator, I would be glad to. We are
    taking a look at our internal processes and making sure that
    they are being complied with and find out if there are things
    that we have to tailor. We would be glad to share that.
        Senator Clinton. I would appreciate that. Does the internal
    processes review also include looking at these individual cases
    that have come to the attention of the press? Obviously that
    concerns us as well.
        General Schoomaker. Yes, ma'am.
        Senator Clinton. Thank you, General.
        General, with respect to the news that yesterday the Army
    Corps of Engineers admitted it had falsely stated that the Air
    Force and the Small Business Administration were involved in
    the awarding of the contract to Halliburton for the rebuilding
    of Iraq's oil industry, will you direct the Corps to provide
    this committee with information on how it decided to award that
    contract to Halliburton?
        General Schoomaker. I will ask them to do that, Senator.
        Senator Clinton. Thank you, General.
        General, I am deeply impressed by the work that the Army is
    doing under the rubric of transformation. The report that you
    have provided us in this posture review is very reassuring and
    persuasive as you make these significant changes. I am also
    concerned about some very old problems, and the recent
    unclassified study by the Army's Combined Arms Center at Fort
    Leavenworth, a 504-page internal Army history of the Iraqi war,
    which pointed out considerable problems in logistics.
        In reading the press reports of this report, we are struck
    by all of the old-fashioned problems we had. People could not
    communicate. They always were outracing their supply lines.
    They did not have the information as well as the resources that
    they thought. The fact that the strategy of starting the war
    before all support groups were in place, in order to achieve an
    element of surprise, taxed the resources of local commanders.
        How are you addressing that issue? Is that an issue that is
    reflected in this budget or are there additional resources and
    changes that need to be taken into account?
        General Schoomaker. Those issues are reflected in the
    budget. The logistician for the combined force land component
    commander, General Christianson, is now the G-4 of the Army. He
    suffered the problem on that end. He is now part of the
    solution, and we are aggressively looking at it.
        You are exactly right, we have not made the best use of our
    information technologies. We have not done things that we can
    do to fix this. But in all fairness, I also have to say that
    the distances and the speed at which all of this occurred
    seriously exposed these issues. These are far greater distances
    than were anticipated doctrinally. I have heard it said that
    the distance from Kuwait to Mosul, up where the 101st was, is
    like going from Omaha Beach to Berlin. That is a pretty good
    distance. That is a lot further than Patton tried to do in his
    Redball Express.
        I think this is a serious issue because it has everything
    to do with our strategic and operational level agility, and our
    ability to do the logistics. There is also a lot of money tied
    up in this. Believe me, we are going to school on this piece.
        Senator Clinton. General, I know that many of us on this
    committee want to be very helpful to you in confronting this
    set of challenges, and it does strike me that there is an
    opportunity here to think a little bit outside the box. I have
    long thought that we ought to be pushing much harder on
    alternative energy and clean energy. We use fuel cells, for
    example, to lift off our space shuttles, but we are not yet
    figuring out how to use them in our military on a day-to-day
    basis.
        There are some opportunities not just in the immediate
    arena about how we should solve this problem the best we can
    right now, but also opportunities to think outside the horizon
    about what could we be working on at this moment that would
    help us. We would appreciate any suggestions or ideas that you
    or any of the other Services have that would enable us to help
    on this.
        I was particularly struck in the report about the failure
    of communication, which was so reminiscent of what happened in
    New York on September 11. Police were not able to talk to
    firefighters, people in one part of the building could not
    communicate with someone in another part; and then to read that
    again the radios were out of range, and people were improvising
    with cell phones. We just have to get a better grip on what we
    need to do with technology.
        Just as the Defense Advanced Research Projects Agency
    (DARPA) and the space program were the source of new technology
    that had tremendous effects both for the military and civilian
    side, we need to be making some of those investments today as
    well.
        General Schoomaker. I do not disagree with you.
        Senator Clinton. The final point I would make to all the
    Services, General, is that I appreciated what you said about
    train, alert, and deploy, and I continue to be concerned about
    the medical and dental readiness of our Guard and Reserve. I
    asked this question for all of our Service Chiefs at last
    year's posture hearings, but since then a General Accounting
    Office (GAO) study released in 2003 found that the Army had not
    been able to consistently carry out the statutory requirements
    for monitoring the health and dental status. The result was
    that many reservists called up could not be deployed because of
    health, and particularly, dental problems.
        I would like to get some additional information about what
    we are doing to try to deal with that. Of course, the fact that
    we do not have universal health care insurance so Guard and
    Reserves are on the civilian economy, and do not necessarily
    have the health care that they need, is an issue far beyond
    this hearing. I would appreciate knowing about whatever the
    Army or other Services are doing to try to make sure that we
    have the health status as good as possible.
        General Schoomaker. Senator, I am happy to report that we
    are tracking this very well. For those we have mobilized, we
    have a baseline of their medical status as they went in. As
    they come back out, we are doing a very good job in comparing
    the baseline to make sure they are corrected.
        But you are exactly right. We were previously funded to
    have one physical every 5 years for our Guard members and no
    dental. This means that they arrive with only what they have
    been doing with themselves. It is one of the reasons why we
    changed the mobilization criteria. Now we mobilize for the
    first 25 days, and do a medical check. If we have problems, we
    demobilize. We only keep those that pass it as it goes forward.
        We have to fix this systemically in the future, and part of
    that is being better prepared before an alert so that we can
    deploy more rapidly with a more ready force.
        Senator Clinton. Thank you.
        Chairman Warner. Thank you very much.
        Senator Sessions.
        Senator Sessions. Thank you, Mr. Chairman.
        I want to congratulate all of you on the continuing superb
    performance of our men and women in uniform. I could not be
    prouder. They have been stressed in a number of different
    situations. They have consistently shown discipline and courage
    on the battlefield or in the streets of the cities in Iraq.
    Many of them had to have felt threatened, but they have held
    their fire, they maintained their discipline in the face of
    hostility, and have won friends as a result. I am just very
    proud of them.
        Also I am proud and hope we can continue to improve our
    jointness idea, where air, ground, naval, and marine forces all
    work together as one force for America. As we do that, I think
    we will utilize our existing resources better. We get more bang
    for the buck that we have invested. I could not be prouder of
    what you are doing. We are transforming in the middle of a war.
    It is a very stressful time to have to do that. Maybe it is a
    good time in the sense that we are learning exactly what we
    need to be effective.
        As you noted on logistics, General Schoomaker, you learn
    from stress. We are learning from stressing our Guard and
    Reserve how we can do it better.
        General Schoomaker, is it fair to say that since you have
    been in your position, one of your top priorities has been this
    personnel issue; how to confront it, how to use our Guard and
    Reserve better and more effectively, and how to configure our
    Active-Duty Forces effectively?
        General Schoomaker. That is correct. We are funding almost
    2.6 million people in uniform, and we need to figure out how to
    get the most out of each and every one of them, not just them
    individually, but how to configure them in a way that is most
    useful for not only the current operating environment but what
    the future one is going to be. We cannot transform without
    transforming the personnel system.
        Senator Sessions. I think you are correct. We are looking
    forward to your report on this intensive analysis you have done
    about troop strength, configuration, and the brigades idea that
    you have. I do think that it is time for us to think anew, out
    of the box, as Senator Clinton said, and really develop a force
    that is appropriate, perfect if possible, for the future we
    might be facing.
        I thought I understood you to say that you could maybe even
    increase the effective force by 30 percent with this
    rearrangement. Did I understand that?
        General Schoomaker. Sir, there is no question we can.
        Senator Sessions. Well, that is a tremendous thing. I know
    you have increased our manpower and our end strength by
    utilizing the flexibility that has been given you. But also to
    be able to increase the effectiveness of our force by 30
    percent, Mr. Chairman, that is tremendous.
        General Schoomaker. Sir, I have to reemphasize, the
    increase in manpower is temporary. I do not intend to retain
    that manpower. I want it long enough to get the pump primed and
    to get these capabilities developed, so that I can have that 30
    percent increase within the level of end strength that I have
    today.
        Senator Sessions. Well, General Schoomaker, you are a
    combat veteran. You have been a special forces guy all your
    life. You understand warfare, and if you say you can do that I
    think we ought to give you the chance to do it. I will be
    supportive for sure.
        General Schoomaker. I appreciate it.
        Senator Sessions. General Schoomaker and General Hagee, we
    are going to have a lot of equipment that has also taken some
    hits and wear and tear in the deserts of Iraq and Afghanistan,
    and we have to reset that equipment so it will be available for
    you. I am pleased to see this budget does have a 7-percent
    defense budget increase but I am concerned. It is good that the
    President has done this. But do we have enough, and do we have
    a plan to reset that equipment, tracked vehicles, wheeled
    vehicles, and other equipment that maybe suffered substantial
    wear and tear? General Schoomaker and General Hagee?
        General Schoomaker. Sir, this year we are resetting the
    equipment that we can with the additional funding we have
    through the supplemental. We do not have the funds to reset
    this equipment within the program beyond this year. I will say
    it one more time: I think we have to have 2 years of
    supplemental beyond this emergency to reset this force. It is
    just going to take us that long to do it. War and the level of
    operation that we have conducted over there consumes equipment.
    It consumes engines, transmissions, and even metal on aircraft.
    This is a huge task. I said that approximately 9,000 pieces of
    equipment need to be reset alone for the prepositioned stocks.
        Senator Sessions. I have heard that a figure of $3 billion
    may be necessary. Is $3 billion a figure that you could vouch
    for?
        General Schoomaker. Senator, that figure does not resonate
    with me. I think that the supplemental that will be required
    will be considerable if we continue this level of operation and
    reset the force.
        Senator Sessions. General Hagee.
        General Hagee. Yes, sir. We are using the 2004 supplemental
    to reset the force during this fiscal year. We are also
    capturing those costs of equipment expenditure both in
    Afghanistan and in Iraq and would expect that those costs would
    be covered by a supplemental in 2005 or in the out years.
        Senator Sessions. I think we are going to have to confront
    that. After the last Gulf War I think we learned we did not set
    aside enough money to refurbish our equipment and it cost us in
    the long run. It is better to invest that early rather than
    later.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator. Thank you
    very much.
        Senator Ben Nelson.
        Senator Ben Nelson. Thank you, Mr. Chairman.
        Thank you, gentlemen, for being here today. Let me add my
    appreciation to the families of the military because, like many
    of my colleagues, I have made calls to those who have lost
    loved ones. I have spoken to wives, I have spoken to parents.
    They are all resolute in their pride of the service of their
    loved one. We all recognize how important that service is and
    how important it is to do everything that we can to have
    adequate end strength for security of the forces as well as for
    the importance of the mission.
        Perhaps in the long term restructuring makes sense and a
    temporary effort to try to make certain that we have end
    strength sufficient to take care of security of the troops and
    the mission makes sense. What I hope is that the process of
    restructuring is being based on that need rather than on the
    budget process. The budget process is in my judgment the
    equivalent of making a pie a piece at a time. That way, we
    never really know what is coming and we cannot see a
    comprehensive budget at any one particular point in time
    because of one nuance or another. We cannot do it in this
    budget, but it will be in a supplemental, or rather in two
    supplementals.
        I hope in the next 3 years there are no more than two
    supplementals, but I suspect it will not be limited to the DOD
    budget. There will be supplementals for other things as well.
        I hope that the process here of reorganization, which
    cannot ignore budgetary constraints and budgetary concerns,
    will not be driven simply by a budget. I think there may be a
    feeling among some of my colleagues that the budget may have
    more to do with it than it should.
        I only want to say that as a prelude to asking, General
    Schoomaker, in your judgment is this being done, not simply for
    budgetary purposes, but for the end strength requirements that
    you see today and tomorrow?
        General Schoomaker. Sir, I am not sure I exactly followed
    your question, but I will tell you why we are doing this. We
    have an enormous amount of momentum as a result of this
    conflict and we ought to take advantage of this momentum that
    we are paying for, because we are conducting operations, and we
    ought to reset ourselves the way we want to be tomorrow, not
    set ourselves the way we were.
        It is kind of a silver lining in a black cloud--if we had
    to pay for this level of motion to get this whole thing moving,
    it would take us decades to do the kind of transformation that
    we can do now within this window of opportunity. It is as
    simple as that in my mind. It may not be complex enough to
    answer your question, but I think that this is a window of
    opportunity.
        Senator Ben Nelson. At the end of the day, it is not being
    done primarily for budgetary purposes? It is being done to
    transform the military and to protect troops and mission?
        General Schoomaker. That is correct.
        Senator Ben Nelson. Present and future missions.
        General Schoomaker. In the end, we end up with the same
    size force configured differently, with better capability for
    the future.
        Senator Ben Nelson. In the interim, is that end strength
    sufficient to protect the security of the troops and the
    mission? I know in the long term transformation may get us to
    where we need to be, but what about the immediate term? To use
    another analogy, if you want to cut asparagus in your garden
    you have to plant it 2 years early. What I am concerned about
    is making sure that in the current situation we will have
    protection of our troops.
        General Schoomaker. Sir, in the current situation, what we
    know today, we are fine. This is working for what we know
    today. I cannot predict what is going to happen in the future.
    If we end up with a huge conflict in the future, all bets will
    be off.
        Senator Ben Nelson. I understand that.
        One more question. I appreciate your response to my letter
    regarding the Army's aviation review. Do you have any idea when
    this might conclude so that we would know what is going to
    happen with regard to any potential changes that might develop?
        General Schoomaker. I expect that no later than the end of
    this month I will be back-briefed on the final results, and we
    will share that here. We will gladly open it up and let
    everybody look at it.
        Again, we are looking at modularity.
        Senator Ben Nelson. Yes.
        General Schoomaker. Right now all these brigades are
    different, from the number of helicopters in them, to the
    number of units, to sub-units within these brigades. The way
    they are organized is extraordinarily inefficient.
        Senator Ben Nelson. I appreciate the fact that you are
    doing that. I think it is important to continue to make those
    reviews.
        General Jumper, I would like to commend you first for
    continuing your vision to maintain what has been referred to as
    a Total Force, blending together active Air Force, Air Force
    Reserve, and the Air National Guard. It has been successful in
    Nebraska, we believe. We have watched it very carefully.
        As part of balancing your forces, are you planning to move
    current KC-135s from Reserve units to the active? If so, do you
    know what would happen to the missions for those that would be
    losing their KC-135s?
        General Jumper. Sir, there is a flow plan that has been
    shown around and I will make sure you get that flow plan. I
    would not want to try to articulate any piece of it because it
    is a total plan. It is out there, and I will be glad to get
    that to you.
        Senator Ben Nelson. If you get it to me personally, that
    will satisfy my questions.
        General Jumper. Yes, sir.
        Senator Ben Nelson. I appreciate it.
        Thank you very much, gentlemen. Thank you for your service.
        Chairman Warner. Thank you very much.
        Senator Bill Nelson.
        Senator Bill Nelson. Gentlemen, thank you for your service
    to our country.
        General Jumper, in the course of the intelligence that was
    given to us prior to us voting on the resolution regarding
    Iraq, we were told not only about the WMD, but we were also
    told about the UAVs. All of this information has since been
    unclassified by statements that were made by the President as
    well as the Secretary of State. The information includes the
    UAVs as a threat to the interests of the United States and
    being put on ships off the Atlantic coast that could threaten
    United States eastern seaboard cities with WMD.
        What we were not told was, as reported by The Washington
    Post a week ago, that Air Force intelligence totally discounted
    the story of the UAVs. The Air Force intelligence that should
    know more about UAVs than anybody else in the country. Did you
    know about that Air Force intelligence report?
        General Jumper. No, sir, I did not at the time. The
    Intelligence Community gets together all elements of its
    intelligence sources and they come together, as the Air Force
    does, and each contributes their knowledge to the effort. That
    goes into an overall assessment that is put out by the Central
    Intelligence Agency (CIA) that has privy to everything.
        I did not know. At the time this was not an Air Force
    position that was contrary to another position. This was our
    input at the time to the overall effort as part of the
    Intelligence Community.
        Senator Bill Nelson. Were you the Chief of Staff of the Air
    Force at the time?
        General Jumper. I was, sir, yes.
        Senator Bill Nelson. Mr. Chairman, there is another example
    as we get into this question of how were we so faulty on the
    intelligence, and how we were not told that there was a
    disagreement, a dispute as to the accuracy of that
    intelligence. Instead, it was presented to us as, in this case
    with UAVs, as if it was the gospel truth. Here the Air Force
    Chief of Staff did not even know about the disagreement in Air
    Force intelligence, and that it had no truth to it.
        Chairman Warner. Would you allow me to read into the
    record.
        Senator Bill Nelson. Please, Mr. Chairman.
        Chairman Warner. ``The classified version showed there was
    a major disagreement on the issue from the agency with the
    greatest expertise on such aircraft, the Air Force. The Air
    Force does not agree that Iraq is developing UAVs primarily
    intended to be delivery platforms for chemical and biological
    warfare (CBW) agents. It said `The small size of Iraq's new
    UAVs strongly suggests a primary role of reconnaissance,
    although CBW delivery is an inherent capability.' ''
        I think you will find that much of the material that came
    before the Senate did have the caveats and so forth set forth
    in them.
        Senator Bill Nelson. Well, according to what you just read,
    it clearly states the Air Force's opinion that they did not
    have the capability of delivering the WMD. We find out that
    General Jumper, the Chief of Staff of the Air Force, does not
    even know about that dispute. That concerns me and it concerns
    the obvious question that we have to answer in the future of
    having accurate and timely intelligence in order to protect
    ourselves.
        Thank you for sharing that, Mr. Chairman.
        General Schoomaker, you have stated here that we should
    train, alert, and deploy the Reserves instead of alert, train,
    and deploy the Reserves. Yet the budget just submitted has a
    $600 million shortfall in the training for the Reserves. Why?
        General Schoomaker. Sir, I cannot answer that. I will get
    back to you on it. I was unaware of it.
        Senator Bill Nelson. It is there. What I do not know is
    that it might not just be the Reserves. It may be the National
    Guard as well. But whether it is $600 million just for the Army
    Reserves or $600 million for the Reserves and the National
    Guard, the question is obviously begged, what you are trying to
    do in remolding the Army? I congratulate you. You have had a
    lot of accolades around this table today, and we want to see
    you succeed. It is a changing world and we have to succeed. Yet
    we have a budget in front of us with a $600 million shortfall.
        General Schoomaker. Sir, I will look at that. I do not
    understand it that way. But, taking your word for it that is
    where it is, I will look at it and I will get back to you and
    let you know.
        [The information referred to follows:]

        Based on projected Reserve component mobilizations in fiscal year
    2005, $606 million for drills and annual training was realigned from
    the Reserve component pay accounts to support other priorities,
    including the extension of TRICARE to the Reserve components. At the
    projected mobilization levels, the Reserve component training budget
    provides the funds necessary to conduct military occupational specialty
    training (individual training at 95 percent), professional military
    education training (leader training), and the necessary operational
    tempo to support collective training for those units preparing for
    mobilization and deployment while in a Reserve status, as well as
    enabling recently demobilized units to maintain their readiness edge.

        Senator Bill Nelson. Perhaps at some time, Mr. Chairman, we
    might want to get General Helmly, the head of the Reserves, to
    come up and let us specifically get at this. This budget is not
    reflecting where the Chief of Staff of the Army wants to go.
        General Schoomaker. Sir, General Profit is here from the
    Office of the Chief of the Army Reserves and also General Blum,
    who is the Chief of the National Guard Bureau.
        Chairman Warner. Does the Senator wish to have the General
    approach the microphone and give a response to your question?
        Senator Bill Nelson. Absolutely.
        Chairman Warner. Fine. General Schoomaker, will you invite
    your colleague up, please.
        General Blum. I thank you for the opportunity to respond on
    this. We are working very closely with the Army on this. It is
    one Army with three components, for the first time in the
    history of this Nation. General Schoomaker is using Army fiscal
    assets against all three components to assure that all three
    components are ready to do what this Nation requires or asks of
    them.
        I am not aware of the $600 million shortfall that you are
    talking about, but I will be happy to look at what you see and
    I would be glad to discuss it. If the goal for us is to have
    all the money we need and want to achieve the level of
    readiness that we would like, that goal does not exist in any
    budget with any supplemental. There will be some risk, and
    General Schoomaker and General Helmly, the Chief of the Army
    Reserve, and I are working in a very collaborative effort to
    make sure, as we move to this modularity piece, which is a big
    piece to solving the problem, that the units get what they need
    in time to be ready so they can make the train, alert, and
    deploy model.
        It is not intended that everybody in the Army, all three
    components, will be equally and adequately resourced, to be
    completely combat-ready at any moment. The people that are
    being reset obviously are coming back in, refitting and
    reconfiguring. That is where resources come from that set up
    the people who are moving into the getting-ready set, so that
    when they are ready and they are called upon they have had the
    training, equipment, and resources they need to go down range
    and do their jobs.
        But I would very much like to see what you have, and if we
    are short, sir, we will work to identify those shortfalls for
    you.
        General Schoomaker. We need to look at this, because we may
    disagree on what it is you are talking about here. I am unaware
    of that level of underfunding.
        Senator Bill Nelson. What I am trying to do is help you.
        General Schoomaker. Sir, I can use all the help I can get,
    believe me. But you have presented something here that just
    does not resonate with me. We have been working so closely
    together, so I am surprised I would not know something like
    that.
        Senator Bill Nelson. Mr. Chairman, I want to help General
    Schoomaker, because jihadists, as I have reported to you, are
    going across the Syrian border and they are killing our
    American men and women. There is an offer out there on the
    table which I have reported to you all, to General Myers, to
    the Secretary of State, and the Secretary of Defense, etcetera.
    There is an offer on the table to seal that border, as
    presented by President Assad. If that had not filtered down to
    you, General Schoomaker, I would suggest that that is something
    you might want to follow up on. It is obviously of considerable
    concern to you to be able to secure that border.
        General Schoomaker. Sir, I watched the Secretary's
    testimony when you raised that issue. I have been on that
    border and I know what it takes to seal borders, and that would
    be an incredible effort if that were possible.
        Chairman Warner. Thank you very much, Senator.
        Senator Kennedy.
        Senator Kennedy. Thank you. Thank you, Mr. Chairman.
        Again, I want to thank all of you for service to the
    country. We are all grateful and we thank you for being here
    today.
        General Schoomaker, I want to just focus on one area and
    that is the HMMWVs, light-skinned HMMWVs. I visited a wonderful
    young person, and I am sure you have too, out at Walter Reed on
    Saturday. He had been wounded December 10, losing both of his
    legs in Iraq. We have had 16 killed from Massachusetts. A great
    number of those have been as a result of riding in light-
    skinned HMMWVs.
        The wonderful young person is Private John Hart. Brian
    Hart, his father, and his mother Alma ask that the one thing to
    try and make sure is that we are not going to let these young
    people out there in light-skinned HMMWVs. You are aware of this
    issue and the problem.
        We have had conflicting testimony in recent months and also
    going back to 2003, on the numbers that are going to be needed
    in terms of the HMMWVs and also the add-on armor kits. Starting
    on September 30, 2003, HMMWV requirements were 1,723. When you
    were here on November 17, the number that was mentioned was
    3,600. Now I believe 4,149 is the exact figure.
        The up-armored HMMWV is more of a challenge. If we go
    strictly with the up-armored HMMWV, it could be as late as the
    summer of 2005 before we would have all of them. Secretary
    Brownlee was talking about 3,600 when he testified on November
    19. You are now talking about 4,100 at the present time.
        In the budget for this year you have $355 million, which is
    818. In 2005 it is $156 million. For HMMWV add-on armor kits it
    is $209 million for this year and none for 2005. Medium truck
    add-on armor kits saw zero funding in 2004 and will see zero
    funding in 2005 for heavy truck add-on armor kits, its zero
    funding in 2004 and zero funding in 2005.
        Does the President's 2005 budget fully fund your
    requirement for the up-armored HMMWVs?
        General Schoomaker. Sir, your numbers are correct on the
    up-armored HMMWVs. The difference in when we testified before
    you last on this issue and now is the marine requirement.
        Senator Kennedy. Marine and Air Force too, I believe.
        General Schoomaker. Yes, sir. The requirement has
    quadrupled. Our total requirement for the entire Army in the
    future is about 11,000 up-armored HMMWVs. We did not have that
    requirement before. The answer is, against the entire Army
    requirement, no, it is not funded here. It is going to take us
    years to do that.
        I think you know that Secretary Brownlee had the chief
    executive officers (CEOs) of both AM General and O'Gara-Hess
    together this week or last week. They are looking at how to
    increase the production levels at the facilities. We are
    raising production levels from 80 to 220 a month, and right now
    in those plants they are working two 10-hour shifts. We are
    looking at how we might be able to increase it further.
        Senator Kennedy. I think the area and the requirement of
    the greatest need is obviously Iraq and having sufficient
    numbers of either the armored HMMWVs or the armor kits. I am
    just wondering when we are going to be able to get those. How
    are we going to be able to tell the parents of these kids that
    we do not have armored HMMWVs or armor kits available?
        General Schoomaker. Sir, we are producing the add-on armor
    kits in great number.
        Senator Kennedy. Well, the 2004 funding is $209 million and
    there is none in 2005. You have $209 million for 2004 vehicles;
    in fiscal year 2005, zero out. You only have enough in the
    request for 818 HMMWVs. Given the magnitude of this problem and
    the magnitude of the problem today in Iraq, it is difficult to
    see how something as basic as these HMMWVs and the body armor
    are not being met.
        We have the statement from Lieutenant General James Helmly,
    who said: ``The suddenness, the uncertainty, the rapidity with
    which we mobilized the units not only caught them, the Army,
    flat-footed but it meant you had shortages of body armor that
    came up, shortages of up-armored HMMWVs.'' That is January 21,
    2004. He did not mean you. I know you have come in to it.
        What we are asking is why the budget now for the Army does
    not reflect the need that you have in Iraq to make sure that
    every one of those young soldiers is going to be in an armored
    HMMWV or going to be guaranteed that the add-on armor kits are
    going to be there.
        General Schoomaker. Sir, the budget is only part of the
    answer. We are using the current supplemental funding to fund
    much of the level of effort that we have going on, including
    the local efforts I know you are aware of all of the local
    efforts that are going on to manufacture things.
        The Army never intended to up-armor every HMMWV, until this
    kind of situation arose that we have today. We never intended
    to have this number of HMMWVs. We have taken armored units,
    artillery units, and all kinds of other units, and put them
    into HMMWVs as motorized formations, which never existed
    before. This is an area where you cannot fix it overnight. It
    is a matter of physics.
        Senator Kennedy. I understand that this was not
    anticipated. Many of us thought that might be the case. It was
    not anticipated.
        Mr. Chairman, I would like to just ask if the General could
    provide, from the supplementary other funding, all the funding
    that you have available. I want to know so I can tell this
    family exactly whether or not HMMWVs and the body armor these
    parents are talking about have the highest priority.
        General Schoomaker. Sir, force protection is our highest
    priority.
        Senator Kennedy. I talked to General Abizaid 5 months ago
    and he said: ``The supplemental request will permit the
    services to rapidly resolve this equipment problem, rapidly
    resolve the procurement of up-armored HMMWVs.'' That was 6
    months ago.
        General Schoomaker. Sir, we have tripled the number of up-
    armored HMMWVs in theater.
        Senator Kennedy. Okay, but how many are necessary to be
    replaced in Iraq today? How many young people are going out on
    patrol today in Iraq in the light-skinned HMMWVs?
        General Schoomaker. Sir, I do not know.
        Senator Kennedy. If any of them are going out it is wrong,
    I think. You would agree, would you not?
        General Schoomaker. Sir, there are some people that do go
    out there and they go out on purpose, but there is capacity
    there for people to use the up-armored ones for their patrols.
        Senator Kennedy. General, we can get into this. You will
    have a tough time convincing the young boy I saw, who lost both
    his legs 4 weeks ago in a light-skinned HMMWV.
        Now, if there are areas that are passive, okay. I think
    that it is a tragedy if we are not ensuring that every young
    serviceman that goes on out in any dangerous area in Iraq, is
    not going to be adequately protected. I do not understand it.
    If you have the supplementary funding and the production list,
    I want to know how we are going to guarantee this so I can tell
    tell the Hart family, that there is not going to be a young
    person that is going to go out on a patrol in a risky area in
    Iraq that is not going to have the adequate protection. We
    ought to be able to do that. I am sure you agree with that.
        General Schoomaker. Sir, I do. I am with you 100 percent.
    We will provide you with that data.
        Senator Kennedy. If we can get that from you and the
    supplementary services and what is happening over there in
    terms of these patrols, I would appreciate it.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator Kennedy.
        When I opened the question period of this hearing, the
    question period, my first question related to the HMMWVs and
    their status. I think Acting Secretary Brownlee and the Chief
    of Staff are doing their very best. I should point out that in
    my detailed discussions with you, General, about the issue of
    the HMMWV, you carefully pointed out to me that there are some
    missions during which the men are safer using the lighter
    weight HMMWV. Am I not correct on that?
        General Schoomaker. Sir, there are people making choices on
    which vehicle they want. The choices are not random, but
    because the nature of the mission requires it, they choose not
    to use the up-armored HMMWV. This whole measure of protection
    against IEDs and other things is a matter of a multitude of
    capabilities, as has been discussed, to include some that we
    should not discuss here.
        I am confident that we are doing everything we can to move
    increasingly more up-armored HMMWVs and other armored vehicles
    into theater to do exactly what Senator Kennedy is talking
    about. We share the same goal here.
        Chairman Warner. It is important that you share the same
    goal.
        Senator Kennedy. I thank the chair, but the fact is you are
    below the requirement that the Army has set for themselves and
    this budget which we are having our hearing on does not provide
    the makeup of the requirement that the Army itself has set.
    That is my point. If it does and I am wrong and you are making
    it up with supplementary funds, then I look forward to hearing
    from you.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you.
        General Hagee, do you wish to make any further comments
    about the HMMWVs that will be in your units going over?
        General Hagee. No, sir. I have already addressed that in my
    statement, sir.
        Chairman Warner. Thank you.
        Now, Senator Levin, you and I will conclude here. Would you
    like to lead off and we will just alternate with questions?
        Senator Levin. I would be happy to do that.
        Just on this HMMWV issue, is the facility that is armoring
    the HMMWVs working three shifts?
        General Schoomaker. I do not know how many shifts they are
    working. I am told they are working 20 hours a day, and I
    believe that is two shifts of 10 hours.
        Senator Levin. Can we check that out?
        General Schoomaker. Yes, sir.
        Senator Levin. Just to make sure that they are working 24-
    7? As to whether there is anything more that we can do
    moneywise, we do not have to wait for a supplemental. This
    issue is important enough that it could be done tomorrow if
    there is any indication that the budget is the reason. If it is
    not the reason, then is the facility going 24-7? If it is not,
    then we expect it will be.
        General Schoomaker. Sir, I will get you all of the facts on
    this.
        [The information referred to follows:]

        No, the facility that is up-armoring the HMMWV is currently working
    two 10-hour shifts each day. During these shifts, the contractor is
    producing 185 vehicles for March, 205 vehicles for April, and 220
    vehicles per month for May through August 2005. This contractor is
    fully capable of meeting our needs.

        Senator Levin. General, one of the disadvantages of the new
    unit rotation approach is that the expertise that is gained and
    the relationships with Iraqis that have been built over a 12-
    month period are severed abruptly. They are cut abruptly in a
    major way as these whole units rotate. It would be much less
    dramatic if it was individual rotation. Is that an issue which
    is being addressed in some way?
        General Schoomaker. Sir, as I mentioned, we are stretching
    this rotation and the turnover over a period of 4 or 5 months
    for exactly that reason. I know for instance the unit that I
    talked to in the training base the other day has already made
    four trips over there and is doing right-seat rides. This
    period of handoff here is deliberate and the intention is to
    make sure to pass all the contacts to one another and be
    comfortable in that regard.
        General Hagee. Senator, I would like to add that we are
    doing the same thing in the Marine Corps. We are working very
    closely with the 82nd Airborne Division over there. We have
    already made several trips over there, and we are going to take
    our time in the handover to ensure that we are completely
    familiar with that battleground.
        Chairman Warner. I will shift to a question here now for
    the CNO. The subject is shipbuilding, which is something that
    you and I have worked on for many years. The budget request for
    the Navy's shipbuilding and conversion account is almost $1.5
    billion less than last year. The Navy states there are nine
    ships in the budget request, but two of these ships, one DD(X)
    and one LCS, which has been your ship from the beginning, are
    funded with the research, development, test, and evaluation
    (RDT&E) funds at a fraction of what these ships will eventually
    cost.
        I am also concerned that the budget request projects only
    six ships in the fiscal year 2006 budget.
        Can you enlighten us as to why DOD reduced the shipbuilding
    and conversion account by 13 percent in this particular request
    before us here today? You have often spoken of your 375-ship
    Navy. I think we are at 297 this morning, thereabouts?
        Admiral Clark. 294 this morning, Mr. Chairman.
        Chairman Warner. 294.
        Admiral Clark. Yes, sir.
        Well, the path to 375 is to start buying new ones and to
    buy the kind of ships that we need for the future. The LCS will
    allow us to buy the kind of ships we need to dominate the near-
    land arena and we are going to have to buy them in numbers.
    They are going to be smaller ships, but we are not buying them
    just so we can buy small ships to have numbers. Because it is
    plug-and-play, it is going to be a revolutionary kind of a
    concept in the way we build, outfit, and put the combat systems
    in the ship, again with very low manning. That is what we need
    in the future.
        Your specific question about why this number is lower than
    last year is that each year when I have come to testify before
    this committee I have been trying to make this number bigger.
    As I mentioned in my opening statement, I have balanced this
    the best I know how. Because we have been allowed under the
    procurement rules to procure the first ship of a class in R&D,
    the number for this particular year is a lower number. The
    reality is that if we had paid for it all in 1 year the
    Shipbuilding and Conversion, Navy (SCN) number itself would be
    remarkably bigger.
        The other thing about it is that we have several ships that
    are being done in modernization programs that constitute major
    segments of the total SCN fund. I am talking specifically about
    the SSGNs and the engineering-refueling overhauls in the
    submarines and so forth.
        As I have said before, we need to think about
    recapitalizing the ships in the Navy with a stream of
    resources. I have said that I am reaching for a $12 billion
    stream and that is what I have been doing.
        I have testified in response to a previous question about
    the importance of DD(X) and the importance to our future Navy.
    Where I see ourselves today, Mr. Chairman, is here. We have
    been working to get to the point where we are today, where the
    ships are going to start rolling off the line, and this is a
    great victory for the Navy, and it has happened because we had
    the support of Congress to get here.
        This is not a finished task. In order to create the
    resources to recapitalize the Navy, we are trying to transform
    the way we do business in the Navy. The resources that have
    allowed us to move from the number I talked to you about when I
    started this job--I had just between 4 and 5, it was under $5
    billion that year in the account. In the whole decade of the
    1990s it was barely over $6 billion per year. This is the hole
    that we created.
        I am pleased that this year, in new construction, we are at
    almost $10 billion, and with the other modernization we are at
    $11.1 billion. We are on the way. We are not there and we have
    to keep working at it.
        It is exactly what we are working on right now, the
    development of the program for next year. We take a dip next
    year, but we are looking at that hard to see how we can recover
    from that. 2006 happens to be a very difficult year for us.
        When the Secretary of Defense was here he raised a question
    about the gap that we have taken in DD(X) in 2006. I will tell
    you that there is a learning curve to be had in any
    shipbuilding project, as in any development program. If I had
    plenty of resources, I would have funded that ship in 2006 and
    kept right on going as fast as we could. The fact is I am
    required to put all of the money in 1 year to buy a ship for a
    4- to 6-year construction or a 6- or 7-year construction for a
    carrier and I did not have the resources in the 2005 bill to
    put it in 2006. We will be working that hard to see how we can
    improve that number for next year. We desperately need to do
    that to get to the size Navy we need.
        The other point that was made is that the Navy is more
    capable than it has ever been before--a very factual statement.
    Lethal platforms. There is one area, though, where numbers
    really count. The laws of physics still prevail and I have not
    figured out a way to have one of these ships be in more than
    one place at one time.
        I never said 375 is the exact number. It is about the right
    number. As you analyze the scenarios and the kind of forward
    presence that the Nation wants when representing the country,
    that number will ebb and flow. It is the target for us to reach
    for and we are seeking to rechannel funds so we can realize the
    Navy of the future.
        Chairman Warner. Thank you, Admiral. I know from the many
    years I was privileged to serve in this body it is not a matter
    of preference to the Navy, but we are very conscious as a
    Nation of the need for the sea lanes to be kept open, not only
    for security purposes but also for protecting our commerce.
    Therefore, Congress has historically been very supportive of
    shipbuilding for the United States Navy. Thank you.
        Senator Levin, why do you not take a question.
        Senator Levin. Thank you, Mr. Chairman.
        I would like to ask General Schoomaker about the effect of
    rotation on the capability of the forces that we have there. As
    I understand it, the 4th Infantry Division is modern and
    digitized. The 101st Air Assault Division has a huge helicopter
    fleet. Both of those units are coming out. Will their
    replacements be as capable?
        General Schoomaker. The geometry and the way General
    Abizaid is changing the shape of Iraq over there, require
    different kinds of capabilities. The forces that we are putting
    in there are sufficient for the tasks that he wants them to
    perform.
        I think you know that the Stryker brigade is going to be
    one of the areas where the 101st was, for instance, in the
    north. This is one of the areas where he is starting to move
    more things towards local control. We are meeting his
    requirement with the force structure that he wants.
        I ought to remind you that, even though the 4th Infantry
    Division was there, for instance, we basically dismounted them
    out of most of their heavy platforms and put them in HMMWVs to
    do the kind of things that they were going to do, such as
    motorized force, artillery, in some cases armor, and infantry.
    We are meeting the need that he articulated, and it certainly
    is not the same kind of force that went in and fought the war
    and then stayed.
        Senator Levin. This is sort of a follow-up to that, Mr.
    Chairman.
        What did Secretary Rumsfeld mean when he said that the
    capability of the security forces in Iraq will increase?
        General Schoomaker. I believe he is talking about our Iraqi
    security forces.
        Senator Levin. Thank you.
        Chairman Warner. Let us talk about another aspect of
    intelligence. We have had a lot of discussions, of course,
    about the WMD and things like that. However, we must as a
    Nation constantly be improving our intelligence from lessons
    learned. We cannot wait until six different committees look
    into the intelligence as they are looking at the issues now. On
    a real-time basis, we have to contribute to the Intelligence
    Community and strengthen the decisions and the knowledge that
    we think are best.
        I would like to ask all of you this question. There has
    been significant attention paid to the national intelligence,
    as we said. There were reports shortly after major combat
    operations concluded in Iraq about problems with tactical
    intelligence. What is your assessment of the intelligence
    support provided to the battlefield commanders in the Iraq and
    Afghanistan theaters of operations? What improvements to
    national, theater, and tactical intelligence need to be made
    now to best support our combat forces and others all over the
    world who are relying on this intelligence? What initiatives
    have you taken in your respective military departments to
    ensure the strongest tactical intelligence?
        Why do we not give you a rest, General, and we will start
    in with General Jumper.
        General Jumper. Thank you, Mr. Chairman. The biggest
    problem we found as a result of our lessons learned from OIF
    was our bomb damage assessment and how we were able to get
    accurate and timely bomb damage assessment to the commanders on
    the ground. Part of this is what I call an administrative
    problem. It is a problem of definition in what it takes to
    score an enemy vehicle destroyed, which I think really has to
    be relooked. We are undertaking that now to try and get those
    definitions which are more useful to the field commander, who
    is much more concerned about whether he is going to have to
    deal with an enemy tank company in the next 5 or 6 hours than
    he is with whether or not the national intelligence was able to
    score a kill because the turret was separated from the body of
    the tank.
        It is that sort of detail we are trying to correct, and we
    are also trying to organize ourselves so that we take advantage
    of all the sensors that are over that battlefield. Among the
    Services here, we have hundreds of vehicles over that
    battlefield with sensors that can be turned on to this
    surveillance problem after they deliver their weapons. That is
    one thing we are going to focus on with some energy, in order
    to get that corrected. It has been a chronic issue with late
    Battle Damage Assessment (BDA) and we are going to take that
    one head-on.
        You will see money in our budget against this notion of
    being able to network the platforms we already own. We saw some
    magnificent results during the dust storm in OIF. During the
    depth of that dust storm, we put together our JSTARS vehicles
    with a Global Hawk vehicle, networked the bombers and some of
    the assets from the other Services, in order to know exactly
    when reinforcements were moving down out of Baghdad toward
    especially the Medina Division south of Baghdad, we were able
    to coordinate with our space efforts to know exactly when the
    dust storm was going to be there and then to network those
    assets to be able to destroy them as they moved down, even
    before they got into position.
        Chairman Warner. What about the targeting? Your targeting
    is highly dependent on accurate intelligence.
        General Jumper. That intelligence, of course, was the real-
    time surveillance that was made available because we were able
    to focus those platforms on that particular problem.
        The question is, then, how do we arrange these assets so
    that we can shift from some of the national priorities of
    collecting intelligence to be analyzed into putting those same
    assets against the real and emerging problems that exist on the
    battlefield at any one moment, like we were able to do during
    the dust storm?
        With proper networking, you can treat this as an
    interleaved solution. You can focus for just very short periods
    of time, seconds or minutes, on one problem long enough to get
    an answer and then go back to another chore, much like you do
    with a network of computers.
        This is what we are trying to do. There is money in the
    program to be able to do this with networking, with programs
    like the E-10A, and other command and control efforts along
    with the Intelligence Community to network this in a proper
    way.
        Chairman Warner. Thank you.
        General Hagee.
        General Hagee. Yes, sir. This is an issue that we are
    addressing, just like the logistics issue that Senator Clinton
    brought out. Sir, when you talk about tactical intelligence,
    you are talking about information that is fleeting, and it is
    really important that you get it quickly to the user on the
    ground.
        I would divide this into three main areas. One is UAVs, and
    General Jumper talked a little bit about that and the ability
    of our UAVs to quickly get that information down to the
    individual marine or soldier who is on the ground. We are
    addressing that in this particular budget.
        The second area, which General Jumper talked about quite a
    bit, is having these various sensors be able to talk to one
    another, to fuse this information and turn the data into actual
    intelligence quickly for that individual on the ground. We are
    addressing that large area.
        The third area has to do with human intelligence (HUMINT).
    When you get right down to it, there is just some information
    that you can only get via HUMINT. I believe that we need to do
    much better in this particular area. Having discussed some of
    this with Director Tenet, I know he feels exactly the same way
    and is doing what he can to increase this Nation's HUMINT
    capability.
        Chairman Warner. Thank you very much. I likewise want to
    see emphasis put on HUMINT.
        Admiral?
        Admiral Clark. Well, there are several areas that I would
    focus on. I would start by saying that there were some great
    victories in intelligence and we are focusing on all the things
    that did not turn out right. I happen to believe that one of
    the first things that we need to focus on is continued work to
    turn strategic intelligence into tactical intelligence with the
    speed of light. We are unable to do that and get it to the end
    user. What I believe happens today is that there is a lot of
    intelligence that is there, and we own it, but we cannot get it
    to the right place.
        Let me give you an example of things that worked very well.
    It has been little talked about, but we were able to determine
    that they were trying to and were ready and prepared to deploy
    mines in the waterways. If they had done so we would have been
    working for months to get them all out of there. Fortunately,
    we saw them doing it. We had the intelligence to get it done.
        Here is what I think that leads to. I believe the future is
    going to have a much greater focus and influence on a
    requirement for pre-hostilities. This is why I believe that
    gets me to sensors. General Hagee mentioned UAVs. It is all
    unmanned sensors. We had, for the first time ever, a half dozen
    pre-production models of unmanned sensors over there working in
    the waterways. It is important to have the ability to know
    before hostilities start and to be able to operate
    clandestinely in enemy territory or in near-land arenas.
    Lacking that, you cannot play your hand until hostilities
    start.
        We have to have the platforms and the sensors to be able to
    do that. We need unmanned vehicles in the air and on the
    surface. A major problem for us is we have to sort ourselves
    out in the waterways, where it is free for everybody to be. You
    cannot do that with a large platform. This is why a low-cost
    LCS is so important to me. We have to have a smaller platform
    that can react with speed and saturate and dominate the area
    with unmanned vehicles, so that we own the space.
        Networking is vitally important. General Jumper mentioned
    that. Let me go to the next point.
        We call it Automatic Target Acquisition (ATA). ATA is
    really fundamentally machine-to-machine discussions instead of
    machine-to-human, by human-to-machine discussions. We have to
    exploit our technical advantage there.
        I would say that the other issue with sensors is we have
    programs in the budget that are going to vastly improve our
    capability. Working with the Air Force, Active Electronically
    Scanned Array (AESA) radar is coming. It will tremendously
    improve our ability to see the ground. Then we have to be able
    to communicate it, just as Senator Clinton talked about the
    whole issue of communications. The modern communications that
    will carry these data streams is a primary investment priority
    for the Nation.
        Chairman Warner. Did you wish to include in that the
    programs for countering anti-ship missiles?
        Admiral Clark. Absolutely.
        Chairman Warner. That is a growing concern to this Senator.
        Admiral Clark. Yes, sir.
        Chairman Warner. All right, thank you.
        Now, General Schoomaker.
        General Schoomaker. Sir, thank you. I will be very brief
    here.
        We learned a lot. We have a lot of lessons learned. There
    are about 127 areas specifically in tactical intelligence from
    OIF lessons learned and OEF. About 107 of those have been
    rectified and are working.
        There are four key areas. One of them is tactical
    collection. It has already been spoken to here across the
    board. It really is saying that every soldier is a sensor, and
    you are collecting from everybody that is in touch with the
    space. It has to do with HUMINT, it has to do with the
    integration of UAVs, and it has to do with the kinds of things
    that you can do and live.
        It really is an issue of understanding that intelligence is
    an operation. It cannot be a union issue here. You have to
    fight for knowledge, and that is one of the things that we
    know. It is things like having a common operating picture for
    both blue forces and red forces.
        The second one is in reporting, and that is reporting from
    the soldier all the way up to the national level. We are not
    making the best use of our information technology (IT)
    infrastructure, of our processes and all the rest of it, still
    legacy.
        Also crucial is access to national level intelligence.
    There is still too much difficulty in terms of accessing
    databases across the board in a timely fashion. I am now
    talking about the tactical level, which is still very
    complicated.
        Chairman Warner. That is something we should address very
    promptly. I would appreciate if you would give me a little
    memorandum on how you see that problem and what recommendations
    you would like to make to Congress to step into this situation.
        General Schoomaker. Sir, this is a huge issue and I think
    we all share this question of how we really get access so that
    we can mine all of what we really know in a way that is
    coherent.
        Chairman Warner. Let us close out on this issue. You will
    come back to me and coordinate your memorandum with the other
    Service Chiefs. Senator Levin and I serve on the Intelligence
    Committee, and that, to me, is something we should pay a high
    level of attention to.
        General Schoomaker. Sir, I would add this last point and I
    will quit. That is, networking the analytical centers, so that
    we are not only networking Services but are networked across
    the interagencies and the joint services, national through
    tactical, is very important to us.
        The last point I will make is that one of the things that
    makes our future formation so powerful is that we are putting a
    significant reconnaissance, surveillance, and target
    acquisition (RSTA) capability within those formations. We are
    talking about the modular brigades, ground cavalry kinds of
    organizations, UAVs, and scouts with the kinds of optics and
    sensors that we need. The payback on this in terms of
    capability is huge and that is one of the main centerpieces of
    what we are doing.
        Chairman Warner. As a seasoned combat soldier, you know
    that intelligence is an enormous force multiplier.
        Senator Levin.
        Senator Levin. Thank you.
        I want to go back to the issue of national intelligence and
    the shortfalls and errors there. I asked you about whether or
    not you had been interviewed relative to the effect of impact
    of prewar national intelligence on the planning for or conduct
    of OIF and you indicated no. Now I want to ask you another
    question relating to the national intelligence, and that is
    whether or not you have seen any reports or analyses of the
    impact of that national intelligence on the conduct of OIF.
    Have you seen any reports on the issue inside your service or
    anywhere else?
        It does not make any difference where we start. General
    Jumper, again we will give you the first shot.
        General Jumper. Sir, I am scanning here. That is a broad
    question. I cannot recall anything particular that analyzed
    that. If I come up with something I will get back to you
    immediately.
        [The information referred to follows:]

        Sir, I have staffed this issue with our Senior Intelligence Office,
    the Director for Intelligence, Surveillance, and Reconnaissance, and
    his staff. We have no documentation or other indications of any reports
    of analysis concerning the impact of prewar national intelligence on
    the conduct of Operation Iraqi Freedom.

        Senator Levin. Thank you.
        General Hagee.
        General Hagee. No, sir, I have not.
        Senator Levin. Admiral Clark.
        Admiral Clark. No, I have not.
        Senator Levin. General.
        General Schoomaker. Sir, we only have the lessons learned
    kind of information within our own resources. I have seen that,
    but nothing else.
        Senator Levin. In terms of what I am talking about, you
    have not seen that kind of an analysis?
        General Schoomaker. To the best of my knowledge I have not,
    sir.
        Senator Levin. Now, I have a pending request, as our
    chairman knows, that is sitting on the Secretary of Defense's
    desk. It is a pending report to have interviews with our
    military leaders, including our commanders in the field, to see
    if we cannot make an assessment of the impact of our national
    intelligence on the conduct of OIF. I am just hopeful that we
    can get a positive answer from the Secretary of Defense. There
    just is no justification, it seems to me, for the delay in
    getting a positive answer, and it is essential that this
    committee and other committees look at that aspect of our
    prewar intelligence.
        I am just going to state this. I am not going to ask you a
    question on this. I am just going to state this as a fact, that
    we are awaiting the answer to that request. It seems to me that
    it is a responsibility of this committee and the similar
    committee on the House to understand that impact. I know that
    the Secretary of Defense has representatives here. Perhaps we
    can get a prompt answer and a positive answer to my request.
        Chairman Warner. On that point, when you and I were
    visiting with the Secretary, I think it was last week, we
    discussed a range of those inquiries and he seemed to indicate
    that he is going to take these under serious consideration.
        Senator Levin. I hope he does. I think our responsibility
    is a heavy one here for the future well-being of this country
    as well as for any accountability and responsibility in the
    past. The future it seems to me requires that we do everything
    we possibly can to understand the effect of our intelligence on
    operations and planning, as well as the other aspects of
    intelligence for other purposes. That is right within the
    purview of this committee, and I would hope that the Secretary
    of Defense would help us carry out that responsibility with a
    positive answer.
        I have just one last question for General Hagee. There have
    been press reports that some of the Marine Corps officers
    believe that the Army was too confrontational in its approach
    in Iraq and unnecessarily antagonized the population, and that
    the Marines were going to pursue something less confrontational
    as a way of encouraging greater Iraqi cooperation against the
    insurgents. I am wondering if you would comment on those press
    reports, and tell me whether they are accurate or not?
        General Hagee. Sir, I have seen those press reports and I
    can tell you that the Army and the Marine Corps are working
    together very well to ensure that we have learned all the
    lessons that they have gathered over there and that we can
    implement them when they go in.
        When the Army first went in, the battlefield looked a
    certain way and, because of the great performance of those
    soldiers over there, that battlefield has changed. Both the
    Army and the Marine Corps are changing their tactics to respond
    to that change.
        Senator Levin. Thank you.
        Chairman Warner. Thank you.
        Gentlemen, we have had an excellent hearing and we will be
    submitting additional questions for the record. Thank you very
    much and pass a well-done down to your troops.
        [Questions for the record with answers supplied follow:]
                   Questions Submitted by Senator John Warner
                       spare parts and logistics support
        1 and 2. Senator Warner. General Schoomaker, last year, Congress
    supported the Army's request for significant increases in funding for
    fiscal year 2004 to address challenges in the Army's spare parts and
    logistics support program. Current estimates indicate, however, that
    the Army will only be able to spend approximately 70 percent of what
    was authorized by Congress. Why is the Army unable to fully execute the
    amount authorized by Congress? What are the consequences for the Army
    of not spending the funding for spare parts and logistics support
    program that was authorized by Congress?
        General Schoomaker. In the fiscal year 2004 budget request the Army
    assumed risk in base operations support (BOS) to support an emergent
    requirement to increase the inventory of spare parts. The realignment
    plan, developed prior to operations in Iraq, was a 3-year effort to
    increase spares on the shelf in anticipation of future needs. With the
    onset of war in 2003, the Army used fiscal year 2003 supplemental funds
    to accelerate the replenishment of repair parts. As a result, the funds
    originally budgeted for this effort are no longer required for this
    program and will be realigned to BOS, the original source of these
    funds. This action does not reduce the availability of spare parts.

        3. Senator Warner. General Schoomaker, Admiral Clark, and General
    Jumper, departmental and Service investments in basic research serve
    many purposes, one of which includes training of the future defense
    workforce in disciplines of critical importance to our national
    security. Do you feel confident that the current investment trend will
    ensure an adequate number of appropriately-trained domestic experts to
    fill the Department of Defense's (DOD) need for an innovative workforce
    in key disciplines such as mechanical, aerospace and chemical
    engineering, computer architecture, mathematics, physics, and
    oceanography?
        General Schoomaker. Basic research supports the fundamental
    training of graduate students in the key disciplines indicated, and
    these individuals can contribute to our future defense workforce needs.
    The current funding streams are sufficient to ensure an adequate number
    of students to fill the DOD's needs, assuming other significant
    factors, such as sudden funding reductions, competition with private
    industry for similar resources, or a decline in the number of native-
    born U.S. citizens acquiring advanced technical degrees, do not disrupt
    the trend.
        Admiral Clark. I am confident that both our investments and the way
    in which we have structured our research and development (R&D) programs
    will ensure an adequate number of the kinds of domestic research
    scientists and engineers that you have mentioned. Between the Naval
    Research Lab and the In-house Laboratory Independent Research (ILIR)
    program, we have roughly $115 million going annually to help develop
    appropriately trained scientists and engineers in key disciplines.
        In addition, we are working with the National Science Foundation
    (NSF) to start a $10 million pilot program, commencing in fiscal year
    2005, that is focused on bringing into the Naval Research Enterprise
    the next generation of scientists and engineers. This program, called
    Naval Research--Science and Technology for America's Readiness (N-
    STAR), is focused on revitalizing connections between the Navy's R&D
    centers and the Nation's universities.
        General Jumper. The current Air Force Science and Technology (S&T)
    investment portfolio, including over $215 million for basic research,
    is focused on providing technology that ultimately enables warfighting
    capabilities. Although there may be a perception that overall basic
    research funding is in decline, Air Force ``core'' basic research has
    actually increased about $13 million or almost 5 percent real growth
    over the fiscal year 2004 President's budget. This Air Force basic
    research investment is closely linked with academia and this link is
    expected to attract, develop, and produce graduates that can compete in
    future job markets that support our endeavors in delivering the
    warfighting capabilities needed to ensure our national defense. While
    recruiting and retaining scientists and engineers (S&Es) continues to
    be a challenge, we have no indication that there will be a shortage of
    S&Es in the future.
                                     ______

                   Questions Submitted by Senator John McCain
                                    tankers
        4. Senator McCain. General Jumper, according to the Air Force,
    ``There is only a negligible amount of funds in the fiscal year 2005
    budget that falls under the tanker lease heading, and no funds to
    actually lease aircraft. Should the current review and Congress concur
    leasing is the best way ahead, funds could be reallocated using the
    normal budgeting tools.'' Exactly what funding is there in this budget
    that relates in any way to the tanker program?
        General Jumper. There is no money included in the fiscal year 2005
    President's budget for the KC-767A program. The KC-767A program
    accelerates the start of our tanker recapitalization effort. However,
    the tanker recapitalization program of record in the fiscal year 2005
    President's budget, PE41221F KC-135 Tanker Replacement, has funding
    that starts in fiscal year 2006 and notionally delivers its first
    aircraft in fiscal year 2010, depending on the recommendation of the
    analysis of alternatives.

        5. Senator McCain. General Jumper, from the Air Force's statement,
    am I to understand that it is your intention to fund the lease of up to
    20 tankers by reprogramming from other systems?
        General Jumper. The National Defense Authorization Act for Fiscal
    Year 2004 authorized leasing 20 tankers and buying 80 more under
    multiyear authority. If the program is approved by the Office of the
    Secretary of Defense (OSD), we intend to submit an above threshold
    reprogramming for fiscal year 2005 funds.

                                force protection
        6. Senator McCain. General Schoomaker, I am perplexed about a
    situation dealing with base security forces. The Army active duty,
    Reserve and National Guard security forces are, according to your words
    and every outside expert, stretched thin. In fact, at Fort Huachuca in
    Arizona and Army bases elsewhere, security forces, military police
    (MP), and gate guards are supplemented by the civilian guards. Why are
    Army and National Guard service members guarding Air Force bases?
        General Schoomaker. In September 2002, OSD and the Air Force asked
    the Army to provide force protection augmentation at Air Force
    installations based on the Air Force's inability to sustain global
    force protection and security levels. In December 2002, the Secretary
    of the Army signed a Memorandum of Agreement providing force protection
    augmentation at Air Force installations for 2 years. We are currently
    in the second year. Army augmentation is scheduled to end in November
    2004.

        7. Senator McCain. General Jumper, why are you using Army guardsmen
    and reservists to provide gate guard and base security force protection
    and have chosen not to augment or replace your base security force with
    contract or civilian security guards?
        General Jumper. The use of Army guardsmen was, and remains today, a
    stopgap measure used until longer-term solutions like civilian and
    contractor guard forces are fully developed. Since the service
    agreement was started in January 2003, we have shifted from a mobilized
    Army augmentation force to a 100-percent volunteer force in the second
    year of this 2-year agreement. Originally, the Army provided over 8,000
    soldiers to augment Air Force force protection capabilities. Today,
    that number has been reduced to less than 5,300 soldiers. We are using
    every available means to meet these increased demands through
    utilization of technology infusion, Air Reserve component volunteers,
    manpower realignments within end strength limits, civilian conversions,
    and contract development. Our goal remains the same: reduce reliance on
    mobilized Guard and Reserve Forces as alternatives come online.

                              future combat system
        8. Senator McCain. General Schoomaker, an independent assessment of
    the Future Combat Systems (FCSs) ``other transaction authority''
    agreement conducted by a subcontractor called CommerceBasix highlighted
    the financial risk associated with this $15 billion agreement that was
    being negotiated with Boeing. Among other things, this due diligence
    assessment concluded that if the Army did not address the issues it
    identified in the May 31, 2003 version of the ``other transaction
    authority'' agreement, the Army's contractually based financial risk
    could exceed $1 billion. To what extent were the issues raised in this
    assessment adequately addressed in the final ``other transaction
    authority'' agreement with Boeing?
        General Schoomaker. The other transaction agreement executed
    between the Department of the Army and Boeing for the system
    development and demonstration (SDD) phase of the FCS program contained
    sufficient contractual provisions to provide necessary protections for
    both the Army and Boeing. We are of the opinion that the contractual
    issues raised in the CommerceBasix findings were addressed in the SDD
    other transaction agreement and that the provisions provided sufficient
    safeguards for the government's $14.1 billion program investment.

        9 and 10. Senator McCain. General Schoomaker, to what extent have
    you evaluated the Army's legal and financial risks associated with the
    final ``other transaction authority'' agreement with Boeing? Will you
    provide a copy of documents that reflect your evaluation to this
    committee?
        General Schoomaker. As previously responded, I have not undertaken
    any evaluation regarding the FCS. The Acting Secretary of the Army has
    commissioned the Institute for Defense Analysis (IDA) study and the
    Army will release the study in the June 2004 timeframe.

        11. Senator McCain. General Schoomaker, did Army Acquisition Chief
    Claude Bolton, at any time, convey CommerceBasix' analysis, or any
    information regarding this analysis, to Boeing?
        General Schoomaker. Not to my knowledge.

        12. Senator McCain. General Schoomaker, if Mr. Bolton conveyed
    CommerceBasix' analysis, or any information regarding this analysis,
    please indicate to whom, and when, he did so.
        General Schoomaker. I have no knowledge of this.

        13. Senator McCain. General Schoomaker, please provide a copy of
    both the May 31, 2003, and the final version of the FCSs ``other
    transaction authorization'' agreement.
        General Schoomaker. The information requested is attached.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                  end strength
        14. Senator McCain. General Schoomaker, you are redesigning the
    U.S. Army and growing the number of brigades to meet the challenges of
    the new century. Why does your budget not reflect this?
        General Schoomaker. Lessons from Operation Iraq Freedom (OIF) and
    Operation Enduring Freedom (OEF) have taught us that we need more agile
    forces, capable of operating in a joint environment, and we need them
    as soon as possible. We did not arrive at a decision to implement the
    redesign until after the budget was finalized. Because of the immediacy
    of the requirement, we plan to reconfigure OIF 1 units during their
    reset process. Some of these units may deploy to meet OIF 3 force
    requirements, so we need to reconfigure them immediately. As this
    requirement is directly related to continuing the global war on
    terrorism, we believe supplemental funds are appropriate.

        15. Senator McCain. General Schoomaker, paying for the 30,000
    increase in troops is not included in the budget. Do you plan on
    relying on supplemental spending bills for the next 4 years to pay for
    this increase?
        General Schoomaker. This requirement is directly related to the
    global war on terrorism and is being made under emergency authority.
    Because the increases are above authorized strength, we believe the
    supplemental appropriations are a proper way to fund them.

        16. Senator McCain. General Schoomaker, supplemental bills are
    submitted by the administration for emergency spending requests. Why is
    future end strength considered an emergency-spending request?
        General Schoomaker. As we fight the global war on terrorism, we
    must adapt our forces and our methods to best engage our enemy. We need
    to implement the lessons that we have learned in Iraq and Afghanistan
    as soon as possible. We need to change the way our units are organized
    and how they fight now. The associated requirement for a strength
    increase is a direct result of the global war on terrorism and its
    immediate, but temporary nature, is our reasons for using supplemental
    funds.

        17. Senator McCain. General Schoomaker, every outside independent
    expert has called for increasing Army end strength. The demands of the
    global war on terror have stretched our military thin. Will the
    administration continue to oppose legislative efforts by Congress to
    increase end strength?
        General Schoomaker. While I oppose a permanent increase in the
    Army's end strength, I strongly support a temporary increase of 30,000
    that allows the necessary flexibility for the Army, while fighting the
    global war on terrorism, to increase the number of Active Force Brigade
    Combat Teams (BCTs) from 33 to 43 between now and fiscal year 2007. A
    determination for an additional 5 BCTs (for a total of 48) will be made
    at a later date. This temporary measure will enable the Army to field
    standardized unit designs and transition to a unit-based personnel
    management system. Our intent is to make the Army more ready and
    relevant for the unpredictable nature of the emerging strategic
    environment. Once this restructuring is complete, the Army will return
    to their authorized strength by fiscal year 2009.

        18. Senator McCain. General Schoomaker, we are relying more and
    more on our reservists. According to the testimony of General Myers,
    ``some missions like the ones in Bosnia and Kosovo are almost
    exclusively made up of Reserve and Guard units.'' Reports indicate that
    nearly 40 percent of the soldiers in the Iraqi and Afghan theaters are
    reservists or guardsmen. I am concerned about the retention problems
    that may arise in the near future due to this reliance. What are you
    doing to encourage reservists to re-enlist?
        General Schoomaker. The Army Selected Reserve (SELRES) strength was
    211,380 as of January 29, 2004, or 3.1 percent above its
    congressionally mandated end strength objective. The Army Reserve began
    to notice a drop in attrition and increase in strength soon after the
    first round of calls to active duty (January 2003) in support of
    Operations Noble Eagle (ONE) OEF. Since this time, the Army Reserve has
    been in a continuous state of mobilization with an average of 28
    percent of its troop program unit (TPU) strength called to active duty
    in support of ONE/OEF/OIF rotations. On average, 1.9 percent of the
    SELRES strength attrits each month. The mobilized population has not
    been able to follow this ``normal pattern'' of attrition and may act on
    this ``pent-up'' attrition upon their return. The Army Reserve is
    expecting losses between 22 percent and 34 percent of pent-up attrition
    (based on 12 to 18 months of mobilization) from this population within
    7 to 9 months of their return. Based on these expected demobilization
    losses, the Army Reserve end strength is projected to fall to between
    203,490 and 207,481 by the end of the fiscal year and within the 2
    percent congressional allowance by the beginning of the fourth quarter,
    depending on the timing of demobilization losses and the attrition
    patterns experienced.
        The Chief, Army Reserve (CAR), tasked the Office of the Chief, Army
    Reserve (OCAR) Retention Transition Division to form a Retention Task
    Force to develop and institute initiatives to retain as many of these
    demobilizing soldiers as possible. Some of the ongoing initiatives
    include:

        (1) Completion of a demobilization survey, administered by a
    retention and transition noncommissioned officer (NCO), by each
    returning soldier.
        (2) Counseling provided to each soldier during the demobilization
    process pointing out that they could immediately use tuition assistance
    upon their return, and identifying opportunities in the Army Reserve to
    continue their careers, such as the Active Guard Reserve program,
    warrant officer program, or options for commissioning.
        (3) Free marriage retreats, conducted by Army Reserve chaplains,
    offered to all redeploying soldiers and their spouses.
        (4) Retention and transition NCOs are contacting redeployed
    soldiers during the 90-day reconstitution period giving these soldiers
    a chance to share their mobilization experience and to encourage them
    to stay in the Army Reserve.
        (5) Family readiness groups and commanders are conducting welcome
    home activities during the first Army Reserve training assembly
    scheduled after redeployment.

        The Army Reserve realized improvements in first term reenlistment
    figures in February; however, it remains below mission for the second
    straight month and for the year. Additionally, careerists lagged for
    the 4th straight month. Upon review of the causes of the careerist
    shortfall, it was discovered that the systems used to update
    reenlistment dates had not caught up to the change in policy requiring
    Reserve component soldiers in ranks of staff sergeant or above to
    reenlist for an indefinite term. There are currently over 1,000
    reenlistment contract packets awaiting input into the personnel
    accounting systems. A software change package is due out at the end of
    March 2004. This will enable the Army Reserve to remedy the situation
    by the end of April 2004. Retention of demobilizing soldiers continues
    to be monitored closely to determine the effects of mobilization on
    retention.

        19. Senator McCain. General Schoomaker, the biggest strength of our
    military is the men and women who serve. We have major commitments
    across the globe including 330,000 Army troops deployed to 120
    countries. The United States will have a major presence in Iraq and
    Afghanistan for the foreseeable future. Are the budget priorities of
    the Service in line with the increased demands we are putting on our
    soldiers?
        General Schoomaker. Absolutely. The fiscal year 2005 budget
    emphasizes manning the force, taking care of our soldiers and their
    families, and sustaining the quality of the force. The Army's request
    reflects a strength increase of 2,400 in the active component as
    authorized in the National Defense Authorization Act for Fiscal Year
    2004. This budget also provides soldiers with an average pay increase
    of 3.5 percent.
        The Army is transitioning to an improved manning system designed to
    increase unit readiness by increasing stability and predictability for
    unit commanders, soldiers, and families. The Army is also implementing
    incentives and manning initiatives to meet recruiting and retention
    goals in order to enhance warfighting capabilities.
        The fiscal year 2005 budget begins a rebalancing of the active and
    Reserve components based on rapid response operations, high demand
    units, and rotational requirements. To improve force manning in the
    active component in fiscal year 2005, we will increase authorizations
    to equal requirements by adding 1,043 authorized spaces to existing
    active units. This initiative will bring them to their full requirement
    level in fiscal year 2005 ensuring their campaign quality capabilities.
    Additionally, beginning in fiscal year 2005, the Army will bring the
    Reserve component force structure allowance under programmed end
    strength. This initiative will improve manning and readiness and will
    reduce operational tempo (OPTEMPO) stress in the remaining units types.
    The Army will also convert 917 Reserve component spaces from less used
    structure such as field artillery to high demand units such as MPs and
    civil affairs.
        While we are at war and addressing global war on terrorism
    emergency requirements, these initiatives will relieve some of the
    pressure on our soldiers, while still providing the right mixes of
    capabilities for our Army.

        20. Senator McCain. Admiral Clark, I am a little concerned that the
    Navy is going to face a problem training new aviators over the next
    couple of years. There have been stories of the Navy turning away
    hundreds of qualified aviators already in the aviation pipeline.
    Currently, few pilots are leaving the Navy to fly commercially because
    the airlines are not hiring. When this trend changes and the commercial
    airlines start to hire, the Navy is going to have a shortage of junior
    officers. What is being done to ensure that there are an adequate
    number of junior aviators?
        Admiral Clark. We access enough junior officers as prospective
    aviators each year to allow for training attrition and to properly fill
    first-tour requirements in each squadron. We are continuously updating
    our models to validate actual performance while taking measures to
    incentivize the behaviors we want to optimize our investment in naval
    aviators. This includes a continuing commitment to a robust bonus
    program that helps lessen the economic disadvantage for a pilot serving
    in the military. We have worked hard to improve the quality of service
    for all of our dedicated professionals, including those in naval
    aviation where we are experiencing record retention. As a result, we
    now have an opportunity to both increase the level of experience in our
    squadrons and more selectively choose department heads and executive/
    commanding officers in key aviation leadership billets that those
    junior aviators will aspire to.

        21. Senator McCain. General Hagee, I was recently contacted by the
    father of a constituent who expressed concern that his son is being
    redeployed to Iraq. On his son's first deployment, he flew F-18s, but
    now he is being sent back to Iraq as a MP. Are the Marines that short
    of troops that we are now sending aviators back to Iraq to serve on the
    ground? Is this not a perfect example of why we need to increase end
    strength?
        General Hagee. I can assure you that the Marine Corps is not
    sending our F-18 pilots back to Iraq as MPs. We have embedded within
    our ground combat units, billets for naval aviators to serve as air
    officers. These Marine aviators advise the unit commanders on the
    employment of all types of aviation support from close air support to
    helicopter resupply, medical evacuation, etc. It is not uncommon to
    take advantage of our aviator's recent combat experience by rotating
    pilots from the cockpit to the ground combat units to take advantage of
    their expertise. This relationship has always been an important part of
    our air-ground team philosophy and been in existence since the
    introduction of aviation into the Marine Corps. This is how we normally
    do business and is not related to any shortfall in end strength.

                            national call to service
        22. Senator McCain. General Schoomaker, since you are pursuing a
    temporary increase in manpower levels for the Army which will need to
    be phased out in a short time and could well reside in the Reserves,
    does it not make sense to employ the 18-18-18 National Call to Service
    (NCS) Act to augment the required end strength you are pursuing?
        General Schoomaker. The Army has implemented a National Call to
    Service Program (NCSP) and established a 1-year test of the program so
    we can quantify the impacts of this program. We want to allow the NCSP
    to mature and to complete the 1-year test to help us make better
    decisions on the program and its place in the Army. Currently, our
    force stabilization and modularity efforts are key. The temporary
    strength increase of the Army will need to occur across all parts of
    the military structure not just the initial entry soldier. Our solution
    is focused on long-term results for shaping the Army as a whole.

        23. Senator McCain. General Schoomaker, Admiral Clark, General
    Jumper, and General Hagee, I would like you to discuss the
    implementation of the 18-18-18 plan that Senator Bayh and I included in
    the National Defense Authorization Act for Fiscal Year 2003. In
    particular, what percentage of your total force will be made up of
    personnel under this type of contract?
        General Schoomaker. Since implementation of the NCSP on October 1,
    2003, the Army has had 250 soldiers enlist under this option. Overall,
    the fiscal year 2004 goal for the NCSP is 1,450, which equals 2 percent
    of the initial fiscal year 2004 accession mission and 0.3 percent of
    the total Active Force.
        Admiral Clark. In this first year of implementation of NCSP, the
    Navy's goal of 1,000 NCSP accessions was achieved. This represents 2.5
    percent of the Navy's entire fiscal year 2004 accessions and 0.3
    percent of fiscal year 2004 total active enlisted strength.
        We are embarked on an effort to develop a 21st century human
    resources strategy which will baseline how we acquire, develop and
    retain the people needed to keep our Navy the best the world has known.
    We intend to assess the 18-18-18 methodology to see how we can better
    exploit opportunities to show young people the benefits of service.
        General Jumper. Senator, the 18-18-18 plan was included in the
    National Defense Authorization Act for Fiscal Year 2003 as the NCSP. I
    am proud to say the Air Force hit the ground running with this program.
    We were the first Service to bring someone on active duty and have not
    let up since then. We have accessed approximately 300 airmen since the
    program began on October 1. Our plan is to access 370 airmen this
    fiscal year and an additional 365 next year. This will be 1 percent of
    our non-prior service enlisted accessions each of those years.
        General Hagee. The Marine Corps is currently planning on recruiting
    up to 1 percent of our yearly accession mission via the NCSP. We are
    implementing this program over a 3-year period; 175--fiscal year 2004,
    275--fiscal year 2005, and 350--fiscal year 2006.

        24. Senator McCain. General Schoomaker, Admiral Clark, General
    Jumper, and General Hagee, do you envision expansion of this program?
        General Schoomaker. The Army approached this program somewhat
    differently than the other Services. On behalf of the Army, Rand
    Corporation is conducting a 1-year study that ends on September 30,
    2004, to determine market expansion as well as effects this program
    might have on our other enlistment programs. We placed this program in
    10 of our 41 recruiting battalions. The Rand report will follow in the
    December 2004/January 2005 timeframe. We project expanding this program
    nationwide on October 1, 2004. Upon completion of the study, the number
    of personnel allowed into the program could very well grow, but at this
    time, we want this program to mature.
        Admiral Clark. Yes, we currently plan to double the NCS accession
    next year.
        General Jumper. We are taking a cautiously optimistic view of the
    program and do anticipate the program's expansion in the future. We are
    interested in establishing some type of metric to indicate what the
    majority of these enlistees will choose to do at the end of their
    training plus 15-month commitment. This will allow us to better
    establish a plan to ensure sustainment of these Air Force Specialty
    Codes is not affected.
        General Hagee. At this time, the Marine Corps does not envision
    expansion of this program. We will continue to evaluate this position.

        25. Senator McCain. General Schoomaker, Admiral Clark, General
    Jumper, and General Hagee, what is the role of the 18-18-18 plan
    playing in each of the Services?
        General Schoomaker. The NCSP was implemented to give applicants a
    chance to serve the Nation for a limited amount of time (15 months plus
    training). If they chose not to reenlist for active duty, they would
    then serve 2 years in the Selected Reserves and the rest of their
    service in the Individual Ready Reserve or a national service program.
        The Army continues to shape its programs to attract high quality
    men and women to serve as soldiers. The NCSP is a short-term enlistment
    option that we are focusing on the college markets. The NCSP currently
    has 30 percent of its enlistees with some college versus 25.7 percent
    of the Army's total year to date enlistments. This program will benefit
    both the Active and Reserve component in today's Army and well into our
    future Army.
        Admiral Clark. Sailors enlisted under the NCSP plan play a key role
    in filling critical skill shortages within the Naval Reserve. For
    fiscal year 2004, we have dedicated fully  of our NCSP enlistment
    quotas toward two skills most urgently needed in the Selected Reserves:
    Hospital Corpsman (HM) and Master at Arms (MA). U.S. Navy Reserve has a
    long-term priority need for corpsmen with both training and follow-on
    experience. NCSP HMs will directly support the Reserve mission of
    providing field medics to Marine Corps units (many of which are engaged
    in OEF and OIF). Those recruits enlisted as NCSP HMs will not only have
    received required formal technical schooling, they will also bring an
    additional 15 months of Fleet or Fleet Marine Force experience with
    them as they affiliate with their Reserve units. The NCSP MAs will also
    serve to beef up the Navy antiterrorism/force protection mission, for
    much the same reason as HMs--a combination of formal technical training
    coupled with follow-on fleet experience in a variety of assignments.
    The remaining 12 percent of this fiscal year's NCSP enlistees are
    dedicated (in smaller numbers) to other Reserve Force missions
    including intelligence, anti-mine warfare, and naval aviation. For
    fiscal year 2005, Navy plans to double the number of NCSP enlistees,
    with those sailors continuing to be enlisted into ratings and skills in
    high demand in the Reserves.
        General Jumper. This program has provided our recruiters with
    another tool to try and reach more of America's finest youths. We are
    encouraged by the results but the trends are unclear. Our desire was to
    bring in people that would not have otherwise considered the Air Force
    as a career option. While this is true in some situations, the trend
    indicates most young people would have enlisted either way but opted
    for the NCSP believing it provided the greatest incentives. One of the
    roles we hoped this program would play is to help with manning our Air
    Reserve component forces. We will not know how this succeeds until the
    first of these airmen become eligible to make those career decisions
    late in fiscal year 2005.
        General Hagee. At this time, the Marine Corps is using the NCSP as
    an additional incentive program to attract the ``best and brightest''
    youth into our Marine Corps. We continue to evaluate the success of the
    program and are looking at innovative ways to use the program to
    possibly attract critical skill personnel to support our Selected
    Marine Corps Reserve Units such as intelligence and MPs. The Marine
    Corps has a Total Force Working Group looking at this issue.

                                   munitions
        26. Senator McCain. General Schoomaker, you have directed a ``blank
    sheet approach'' to determine the ``real'' requirement for munitions.
    When will you program the ``real'' requirement into the budget process?
        General Schoomaker. We will program the new warfighting requirement
    in the fiscal year 2006 budget submission. I have given guidance
    relative to this year's programming efforts to conduct an operational
    assessment of planning factors and modeling results used to determine
    war reserve munitions requirements. The intent is to tightly link the
    munitions risk assessment and prioritization decisions to projected
    warfight requirements informed by the current operational environment.
    As the Army matures its thinking about the best way to approach the war
    reserve munitions requirement, we will work with OSD to document the
    modifications required of the process, as laid out in DOD Instruction
    3000.4, DOD Munitions Requirements Process.
        Additionally, we have identified an fiscal year 2005 unfunded
    requirement (UFR) to fill high-priority training ammunition shortfalls
    in small and medium calibers and mortar rounds.

        27. Senator McCain. General Jumper, why has the Air Force chosen to
    leave a joint program after development is complete and the weapon is
    integrated on five Air Force platforms in favor of a single-service
    development program which has yet to be developed or integrated on any
    platform?
        General Jumper. Joint Stand-Off Weapon (JSOW)-A is integrated on
    four United States Air Force (USAF) platforms, but with numerous
    restrictions, issues, and ``workarounds.'' After 12 years in the JSOW
    program, the USAF has dropped zero in combat. Based on program
    documentation, combat, and developmental and operational test data,
    JSOW's operational utility for the USAF, and successful integration on
    USAF platforms, has not been proven. The USAF based its decision to end
    JSOW-A procurement on capability requirements and analyses of a wide
    range of platforms and weapons that can provide the required
    capabilities. We balanced capabilities, cost, and risk during the
    fiscal year 2005 program objective memorandum (POM). We analyzed
    numerous platforms and weapon options to ensure the required
    capabilities (direct attack, standoff outside point, area and theater
    defenses) are being provided and procured, and Wind Corrected Munitions
    Dispenser Extended Range (WCMD-ER) is just one of the many technical
    solutions being applied by the USAF to provide the required
    capabilities. Defense budget plans, the Integration Capability Review
    and Risk Assessment process, and Air Force Studies and Analyses Agency
    studies support the decision. The analyses showed the capability
    requirements could be met with a mix of existing and planned platforms
    and weapons. The planned JSOW-A procurement (475 through fiscal year
    2004) will provide an effective ``bridge'' until other capabilities
    reach sufficient inventories.

        28. Senator McCain. General Jumper, given the Navy's success with
    the JSOW in OIF, how can you justify the risk of weapon development
    when an existing joint program is established and already integrated on
    multiple platforms?
        General Jumper. The USAF analyzed numerous platforms and weapon
    options to ensure the required capabilities (direct attack, standoff
    outside point, area and theater defenses) are being provided and
    procured, and WCMD-ER is just one of the many technical solutions being
    applied by the USAF to provide the required capabilities.
        JSOW is integrated on four USAF platforms, but with numerous
    restrictions, issues, and ``workarounds.'' The USAF has used zero in
    combat after 12 years of participation in the JSOW program. Based on
    program documentation, combat, and developmental and operational test
    data, JSOW's operational utility for the USAF, and successful
    integration on USAF platforms, has not been proven.

        29. Senator McCain. General Jumper, how does the Air Force plan to
    deal with the unexploded ordnance issue for the BLU-97 sub-munitions in
    WCMD and WCMD-ER?
        General Jumper. The reliability of the USAF's current cluster bombs
    is approximately 95 percent. The USAF is further improving the
    reliability of its current cluster bombs with the use of WCMD kits and
    the procurement of a new cluster bomb, Sensor Fuzed Weapon (SFW), which
    has a reliability of 99 percent.
        One of the biggest issues in the past with cluster munitions was
    that we did not have guided delivery systems to ensure precision. The
    baseline, and now the extended-range WCMD allows the USAF to deliver
    the submunitions to precise locations (inertial navigation system and
    Global Positioning Satellite (GPS) guidance), which make it easier for
    the troops to avoid unexploded ordinances as they advance. After the
    conflict ends, clean up is much safer and efficient. In addition, there
    are sensors in SFW that look for targets vice the BLU-97 Combined
    Effects Munition's generalized explosion on impact. The weapon also has
    three built in self-destruct modes if no target is found. This
    combination of features has improved the reliability of the USAF's
    cluster bombs to 99 percent.

        30. Senator McCain. General Jumper, can you explain why the BLU-97
    submunition unexploded ordnance hazard issue does not make the existing
    submunitions inventory obsolete?
        General Jumper. The reliability of the USAF current cluster bombs
    is approximately 95 percent. The USAF is further improving the
    reliability of its current cluster bombs with the use of WCMD kits,
    WCMD-ER kits, and the procurement of a new cluster bomb, SFW, which has
    a reliability of 99 percent through three redundant self-destruct/
    deactivation features. Just like SFW, any cluster weapon submunitions
    the USAF may procure in the future would comply with all established
    policies and directives.
        The baseline, and now the WCMD-ER allows the USAF to deliver the
    submunitions to precise locations (inertial navigation system and GPS
    guidance), which make it easier for the troops to avoid unexploded
    ordinances as they advance. After the conflict ends, clean up is much
    safer and efficient.

        31. Senator McCain. General Jumper, have you conducted a business
    case analysis which shows a clear cost-benefit advantage to the DOD
    (not the USAF) to pursue WCMD-ER over JSOW-A, which includes
    development and integration costs?
        General Jumper. The Air Force decision to cancel the JSOW-A was not
    based on a comparison between WCMD-ER and JSOW-A. Rather, the USAF
    performed a Capability Requirements and Risk Assessment (CRRA) of our
    delivery platforms and munitions. This in-depth analysis determined
    JSOW-A provides a redundant capability relative to a number of other
    weapons and delivery platforms. The planned USAF inventory offers
    several capable and less expensive standoff alternatives to JSOW, such
    as Small Diameter Bomb (SDB) and WCMD-ER, as well as Joint Direct
    Attack Munition (JDAM), WCMD, and Joint Air-to-Surface Standoff Missile
    (JASSM) that could be dropped from stealth aircraft. All these weapons
    are existing programs established and funded by Congress.
        Collectively, these programs mitigate the near term risk with JSOW
    cancellation. No single weapon addresses the entire target set--some
    are adequate for parts of the target set and are significantly less
    expensive. One business case consideration is we already have over
    100,000 rounds for tactical munitions dispensers which can be converted
    to WCMD for $20,000 each, or WCMD-ER for $68,000 each versus JSOW which
    is well over $200,000 each.
        Thus, the final USAF decision was to maintain our total buy of
    JSOW-As at 475 missiles and redirect $398 million of savings toward
    other priorities. OSD and JCS/J-8 validated the decision, but directed
    the Air Force transfer $100 million to the Navy to offset program costs
    incurred by Air Force withdrawal and ensure continuance of ongoing
    production (i.e., maintenance of minimum sustaining rate).

        32. Senator McCain. General Jumper, we understand that in recent
    conflicts, enemy air defenses have not been very capable. However, in
    future conflicts that is likely to change. How much does WCMD-ER
    decrease the survivability of the aircraft compared to JSOW-A given the
    high radar cross section of WCMD-ER?
        General Jumper. The USAF based its decision to end JSOW-A
    procurement on capability requirements and analyses of a wide range of
    platforms and weapons that can provide the required capabilities. We
    balanced capabilities, cost, and risk during the fiscal year 2005 POM.
    The USAF analyzed numerous platforms and weapon options to ensure the
    required capabilities (direct attack, standoff outside point, area and
    theater defenses) are being provided and procured, and WCMD-ER is just
    one of the many technical solutions being applied by the USAF to
    provide the required capabilities.
        Like question #33, this question was addressed in the USAF's
    analyses during the fiscal year 2005 POM and prior performance
    comparisons for area attack weapons. The WCMD and WCMD-ER provide more
    submunitions per delivery truck than JSOW, or, in other words, more
    probability of damaging the target per weapon. The USAF also looked at
    the target sets and concluded that a mobile target set (troops or
    vehicles on the move) are protected by mobile anti-aircraft artillery
    or surface-to-air missile systems, and both JSOW and WCMD-ER have
    similar survival capabilities in this scenario. Due to the increased
    firepower with WCMD-ER, as well as similar survival capabilities as
    JSOW against mobile threats, USAF analyses showed the requirement for
    fewer aircraft sorties to complete wartime campaigns. This translates
    to lower platform attrition and increased aircrew survivability.

        33. Senator McCain. General Jumper, how does WCMD-ER's range,
    approximately half of JSOW's range, adversely effect survivability and
    mission effectiveness?
        General Jumper. The USAF based its decision to end JSOW-A
    procurement on capability requirements and analyses of a wide range of
    platforms and weapons that can provide the required capabilities. They
    balanced capabilities, cost, and risk during the fiscal year 2005 POM.
    The USAF analyzed numerous platforms and weapon options to ensure the
    required capabilities (direct attack, standoff outside point, area and
    theater defenses) are being provided and procured, and WCMD-ER is just
    one of the many technical solutions being applied by the USAF to
    provide the required capabilities.
        This question was addressed in the USAF's analyses during the
    fiscal year 2005 POM and prior performance comparisons for area attack
    weapons. The WCMD and WCMD-ER provide more submunitions per delivery
    truck than JSOW, or, in other words, more probability of damaging the
    target per weapon. The USAF also looked at the target sets and
    concluded that a mobile target set (troops or vehicles on the move) are
    protected by mobile anti-aircraft artillery or surface-to-air missile
    systems, and both JSOW and WCMD-ER have similar survival capabilities
    in this scenario. Due to the increased firepower with WCMD-ER, as well
    as similar survival capabilities as JSOW against mobile threats, USAF
    analyses showed the requirement for fewer aircraft sorties to complete
    wartime campaigns. This translates to lower platform attrition and
    increased aircrew survivability.

        34. Senator McCain. General Jumper, with the large Air Force
    investment in stealth technology on aircraft and other weapons such as
    JASSM, why would the Air Force choose to develop a non-stealth weapon
    that cannot be carried inside the bay of the Joint Strike Fighter
    (JSF)?
        General Jumper. The utility of stealthy platforms is the ability to
    avoid or minimize the aircraft's exposure to enemy threats. The USAF's
    ``kick down the door'' concept of operations (CONOP) relies on stealth
    technology to penetrate enemy defenses and roll them back. This will
    allow less stealthy platforms to conduct follow-on operations with
    reduced risk. WCMD, which will be carried internally on the JSF,
    contains the same number of submunitions as WCMD-ER, so the stealthy
    platform with WCMD carried internally meets the initial roll back
    concept, and WCMD-ER, carried externally on JSF and non-stealthy
    platforms, continues the attacks with standoff capability.

                               depot maintenance
        35. Senator McCain. General Schoomaker, the Army budget submission
    funds depot maintenance at 72 percent of the requirement (1 percent
    more than last year) and BOS services to 70 percent of requirement (4
    percent more than last year). Will your continued underfunding of this
    requirement not drive us toward a hollow force?
        General Schoomaker. The Army's depot maintenance program is funded
    in accordance with Army priorities and is balanced against other high
    priority Army programs. In fiscal year 2004, the Army received $1.2
    billion emergency supplemental funding for depot-level reset in
    addition to the peacetime budget for depot maintenance. The reset
    workload is specifically being driven by planned unit rotations into
    the Iraqi theater of operations. A key portion of the Army's depot
    maintenance funding is the $491 million for recapitalization
    requirements, which bring equipment back to a near-new condition.

                                     dd(x)
        36. Senator McCain. Admiral Clark, how is the Navy progressing in
    selecting a hull design for the DD(X) and what are some of the dilemmas
    that you are facing?
        Admiral Clark. The Wave Piercing Tumblehome Hull (WPTH) has been
    tentatively selected as the baseline for the Ship Preliminary Design
    Review (PDR). Scale model testing to validate predictions that the WPTH
    will meet stability and stealth criteria is due for completion later
    this month.
        As risk mitigation, we have designed and are still testing a Semi-
    Wave Piercing Tumblehome Hull (SWPTH) as an alternative, credible back-
    up to the revolutionary WPTH.

        37. Senator McCain. Admiral Clark, crew size will be dramatically
    reduced on the DD(X). Do you see any potential threats in reducing the
    crew size to around 100?
        Admiral Clark. No truly revolutionary program is entirely without
    risk. That said, the potential benefits of this program--from
    improvements in precise, time-critical strike and joint fires to leap-
    ahead technologies like the integrated power system and electric
    drive--are integral to our success in the future, joint battlespace.
    This ship will command more than 110 times the area of today's naval
    fire support systems, with the growth potential to accommodate new
    capabilities such as the electromagnetic rail gun at lower future
    development cost. Our crew size objective for DD(X) is 125 personnel
    and we have established a threshold of 175. DD(X) will not only deliver
    substantially more combat power ashore than today's combatants which
    require twice that crew size, it will lower total ownership costs and
    will provide a baseline for spiral development of technology and
    engineering to support a range of future seaframes including the
    Littoral Combat Ship (LCS) and CG(X). Further, we are conducting
    extensive analysis of all ship functions, including damage control, to
    mitigate the risk associated with a small crew size by automating many
    of the systems operated manually in today's fleet.

        38. Senator McCain. Admiral Clark, an argument could be made that
    designing a new destroyer is not the most cost-effective way to bring
    the Navy's fleet of ships into the 21st century. Why do you believe
    that the DD(X) fulfills the needs of the Navy better than continuing to
    build the DDG-51, which only costs $750 million?
        Admiral Clark. The DDG-51 is an outstanding multi-mission platform
    that has served this Nation well and will continue to do so far into
    this century. It is the Air and Missile Defense backbone of our Carrier
    and Expeditionary Strike Groups (ESGs), and it provides substantial
    strike capacity with its Vertical Launching System. But the reality is
    that the DDG-51 was originally designed for 20th century missions in
    blue water, leaving us with a capability gap in the littoral and in
    projecting precise, persistent combat power well inland in response to
    the 21st century needs of this Nation. DD(X) helps fill the gap where
    the DDG-51 cannot. DD(X) will command more than 110 times the area of
    today's naval fire support systems, with the growth potential to
    accommodate new capabilities such as the electromagnetic rail gun and
    directed energy weapons at lower future development cost. While the
    DDG-51 may have a lower initial production cost than DD(X), we estimate
    that we will achieve significant reductions of 25-50 percent in
    operations and support costs over the life of the DD(X) as compared to
    the DDG-51. The DD(X) is the right ship for our future.

                                 transformation
        39. Senator McCain. General Schoomaker, Admiral Clark, General
    Jumper, and General Hagee, I notice in the new budget there are large
    increases in funding for already existing programs. How does this
    year's budget proposal figure into your long-term transformation plans?
        General Schoomaker. The Army views its transformation as a
    continuous process encompassing the entire force. It combines advanced
    technologies, organizations, highly adaptive leaders and soldiers, and
    improved processes with new concepts to create sources of dominant
    military power that are responsive, deployable, agile, versatile,
    lethal, survivable, and sustainable.
        The Army continues to make difficult choices to cancel and
    restructure programs to invest in transformational capabilities. In the
    fiscal year 2005 budget we are terminating 14 systems and restructuring
    15 systems to realign $423 million. Some of these investments are
    already providing results in the form of new capabilities today, such
    as in the new Stryker BCT formations being fielded and operating in
    Iraq.
        Other major fiscal year 2005 future force related R&D and
    acquisition efforts include Stryker, which is funded in fiscal year
    2005 to buy 310 vehicles for Stryker BCT 5, (2nd Brigade, 25th Infantry
    Division, Hawaii) to begin fielding in fiscal year 2006; and $1.2
    billion for aviation modernization. The budget request also funds
    procurement of high-mobility multipurpose wheeled vehicles (HMMWVs).
    $156.3 of the $303.7 million for HMMWVs will used to procure 818 Up-
    Armored HMMWVs (UAHs). This increased funding for UAHs is due to
    lessons learned from recent operations.
        This budget request puts us one step closer to realizing a more
    responsive modularized force. The modularized brigades are
    strategically responsive, joint interdependent, precision force,
    dominant across the full range of military operations that we envision
    as necessary in the future global security environment.
        Admiral Clark. The Navy budget request for fiscal year 2005
    reflects a shift in focus to transformational surface combatants and
    sea basing capabilities. Offensive capabilities include DD(X), CVN 21,
    and nuclear-powered cruise missile attack submarine (SSGN) which will
    incorporate innovative technologies and concepts to project joint fires
    and Special Operations Forces faster and to significantly greater
    distances than today. LCS will utilize novel warfighting modules to
    transform maritime dominance in the littorals against increasing
    numbers of mines, submarines, and small combatants. The Multi-mission
    Maritime Aircraft (MMA) will revolutionize broad-area anti-submarine
    and surveillance coverage.
        To link these platforms into a networked force, we've requested
    funding for FORCEnet enablers such as Deployable Joint Command and
    Control and Joint Tactical Radio Systems. Unmanned Airborne and
    Underwater Vehicles (UAV/UUV) such as the Long-term Mine Reconnaissance
    System (LMRS) and Broad Area Maritime Surveillance (BAMS) UAV will
    provide persistent and pervasive reconnaissance and surveillance
    capabilities to the joint force. These existing programs exemplify the
    intention of the Navy's 2005 budget request to accelerate investments
    for a transformed, joint, netted, and sea-based force.
        General Jumper. Transformation is a process of constant change and
    adaptation, integrating revolutionary technologies with revolutionary
    organizations and operational concepts. The Air Force fiscal year 2005
    budget proposal is carefully balanced to support this transformative
    process, both today and over the long-term. It recognizes that key
    capability areas are in different stages of maturity. Some are in very
    early S&T stages that will not be deployed for decades to come. Some
    are in advanced stages of production and deployment as we speak, and
    others are somewhere in between.
        Almost half ($16.7 billion) of the USAF's $36 billion fiscal year
    2005 modernization request is for new ``enabling'' technologies
    supporting transformation in all the Services. It includes more than $2
    billion for space systems such as GPS II and GPS III and the
    Transformational Communications Satellite; almost $2 billion in
    research, development, test, and evaluation (RDT&E) for directed
    energy, hypersonics, and Joint Battlespace Infosphere; and more than
    $57 million for Airborne Electronic Attack. Likewise, half of the
    inflation-adjusted Air Force increase from fiscal year 2004 to fiscal
    year 2005 targets programs forming the leading edge of joint
    transformation today, like Link 16, the Global Hawk UAV, F/A-22, and
    precision munitions like JDAM.
        These current and future capabilities (which also include the
    Advanced Extremely High Frequency (AEHF) communications satellite,
    Automated Intelligence, Surveillance, and Reconnaissance (ISR), Combat
    Information Transport System, Distributed Common Ground System, Joint
    Tactical Radio System, E-10, and Space-Based Radar (SBR)) produce
    ``transformation'' when they combine in the seamless machine-to-machine
    integration of all systems. They are dramatically reshaping warfare by
    enabling joint forces to produce the effects of mass without having to
    mass forces. They achieve an order of magnitude increase in the number
    of targets affected per sortie and dramatically reduce the time it
    takes to put the cross hairs over a target from hours to minutes--and
    do it much more precisely. They greatly reduce the forward logistics
    footprint, protect our information systems, protect our Nation and
    forces from ballistic and cruise missile attacks, and rapidly deploy
    forces anywhere in the world.
        The USAF Transformation Flight Plan details all these efforts.
        General Hagee. The fiscal year 2005 President's budget sustains the
    Marine Corps focus of main effort; current readiness and warfighting
    excellence, while also funding key transformational concepts like
    Seabasing and Expeditionary Maneuver Warfare. Working with our Navy
    partners, these concepts will provide America assured access around the
    globe and revolutionize the way we deploy and employ forces both in
    peacetime and in conflict. The current budget supports the continued
    development and fielding of key systems like the MV-22 Osprey, the
    Expeditionary Fighting Vehicle (EFV), and the short takeoff vertical
    landing (STOVL) JSF. When these and other critical enabling systems
    enter service with the Corps, they will significantly enhance the
    already potent capabilities represented by today's naval expeditionary
    forces.
                                     ______

                  Questions Submitted by Senator Jeff Sessions
                                   readiness
        40. Senator Sessions. General Schoomaker, this committee applauds
    the performance of the Army's deployed men and women in OIF, OEF, and
    the global war on terrorism. A lingering concern I have is not the
    readiness of the soldiers in uniform, but rather the readiness of their
    equipment and the substantial reset effort faced by the Army. In the
    past the Army harvested significant dollars from current force programs
    to pay for the future force. Army systems are now accumulating a year's
    worth of wear and tear in a month, a decade in a year, in what is
    acknowledged to be some of the harshest environment on Earth. Most of
    the deployed track and wheeled vehicle equipment is now in need of
    overhaul, rebuild, and upgrade. I am told in the Army budget brief that
    the Army has approximately $1.8 billion planned for the restoration of
    10/20 standards. But I am deeply concerned that 10/20 standards are not
    acceptable repair levels for our key combat systems, many of which will
    need complete rebuilding of suspensions systems, engines, and the black
    boxes that run them following their arduous duty in Iraq. These systems
    are well beyond the 10/20 standard of repair, which I am told is being
    applied to most equipment returning from Iraq. What is your plan to
    have the industrial base and their public-private partnerships bring
    this equipment back to the depot condition our soldiers deserve?
        General Schoomaker. The Army covers depot maintenance requirements
    by funding major end items, (tanks, helicopters, wheeled vehicles and
    communications equipment) and secondary components (engines,
    transmissions, and suspension systems). Both programs deliver a product
    in accordance with national maintenance program standards that ensure
    all deterioration and damage are restored and repaired to a serviceable
    condition. In fiscal year 2004, the Army received $1.2 billion
    emergency supplemental reset funding for depot level overhauls and
    rebuilds in addition to our peacetime budget for depot maintenance. The
    U.S. Army Forces Command also received $251.6 million in reset funding
    specifically targeted for 10/20 level work. The Army is using reset
    funding to have its industrial base and industry partners restore key
    combat systems to the 10/20 standard condition our equipment was in
    when it deployed with our soldiers. To date, the Army has expanded its
    industrial base by establishing over 40 partnerships between the Army's
    depots and private industry.

                                    comanche
        41. Senator Sessions. General Schoomaker, I know that Comanche has
    had a troubled past within the Army, in part due to increased
    requirements and in part due to it serving as a ``bill-payer'' for
    other programs. It seems the Army finally got it right with this last
    restructure, that the program is doing well and meeting all performance
    criteria. So well in fact, that the Army fully funded it once again in
    the latest budget. Tell me what the Office of Management and Budget
    (OMB) review means?
        General Schoomaker. Senator, the study was directed by OMB as part
    of their response to the fiscal year 2005 budget submission. They
    directed OSD to conduct the study, but did not divulge their reasoning
    for the study to the Army, nor did they direct any tasks to the Army.

        42. Senator Sessions. General Schoomaker, will the Comanche remain
    the critical part of the future force we expect it to be?
        General Schoomaker. Armed reconnaissance is a critical component
    that will allow the Future Force to see first, understand first, act
    first and finish decisively. The Comanche is the platform the Army
    currently envisions for this role.

        43. Senator Sessions. General Schoomaker, can you comment on
    whether the Comanche is in fact meeting its key performance parameters
    and milestones as outlined in the restructured program?
        General Schoomaker. The Comanche is performing well in its current
    phase of development. It is expected to meet key performance
    parameters.

                                     jstars
        44. Senator Sessions. General Jumper, we understand Joint
    Surveillance Target Attack Radar System (JSTARS) aircraft are crucial
    to U.S. forces and played a pivotal role in sandstorm battles during
    OIF. JSTARS's contribution was so important that aircrew members
    incurred additional risk continuing missions over hostile territory
    with engines shut down. The E-8C aircraft have known mission-degrading
    problems with aging engines. While the entire aircraft was reworked
    previously, the engines were not. Congress suggested that the Air Force
    study the best fix for the problem. Are you close to a cost-effective
    decision to remedy the situation?
        General Jumper. The Air Force intends to address our preferred
    JSTARS engine approach in the fiscal year 2006 POM. Meanwhile, we have
    prepared and are staffing the DOD's response to Congress' request for a
    study of three JSTARS re-engining options. The three potential options
    are: (1) maintain the current engine, (2) lease a replacement engine,
    or (3) purchase a replacement engine. Information to include associated
    costs are included in the response to Congress.

        45. Senator Sessions. General Jumper, what are the associated costs
    and when will you begin to execute a creditable program to remedy the
    situation?
        General Jumper. The Air Force intends to address our preferred
    JSTARS engine approach in the fiscal year 2006 POM. Meanwhile, we have
    prepared and are staffing the DOD's response to Congress' request for a
    study of three JSTARS re-engining options. The three potential options
    are: (1) maintain the current engine, (2) lease a replacement engine,
    or (3) purchase a replacement engine. Information to include associated
    costs are included in the response to Congress.

                              shipbuilding program
        46. Senator Sessions. Admiral Clark, our Navy has performed
    superbly, carrying the fight to the enemy, surging quickly, and
    bringing impressive sea power to the global war on terrorism. I am
    happy to see that shipbuilding and aircraft programs continue to
    provide for recapitalization of your equipment that is badly needed. I
    am concerned however that your ship inventory will drop to 290 ships.
    Is the shipbuilding program keeping pace sufficiently to deliver the
    force structure needed?
        Admiral Clark. We are on the right track with this year's
    shipbuilding program to deliver the kind of force structure that we
    need for the 21st century. That said, we cannot undo history. We simply
    did not buy enough ships in the 1990s. Over that decade, our
    shipbuilding budget averaged just over $6 billion per year, all while
    the Congressional Budget Office (CBO) was estimating that $12 billion
    in shipbuilding per year was necessary merely to sustain the force
    structure as it was. While I don't think that the 290 ships that we are
    projecting for fiscal year 2005 are enough to meet the long-term needs
    of this Nation, our budget request provides for a steady rise in that
    number beyond fiscal year 2005, and it will continue to rise as we
    build the new ships in the program.

        47. Senator Sessions. Admiral Clark, must we act to provide the
    advanced appropriations this year for the Amphibious Assault Ship
    Replacement (LHA(R))?
        Admiral Clark. The Navy/Marine Corps Team would benefit from an
    advanced appropriations approach to the procurement of LHA(R). Fiscal
    pressures experienced in this budget build, and the full-funding policy
    for ship procurement, caused us to move the planned procurement of
    LHA(R) from fiscal year 2007 to fiscal year 2008. In doing so, we have
    added some risk to the maintenance of a stable industrial base. Split-
    funding would allow us to mitigate this workload risk and avoid the
    potential for the layoff and rehiring of the skilled workers that will
    be needed to build these ships in the future.

                              transformation plans
        48. Senator Sessions. General Schoomaker, I support Secretary
    Rumsfeld's efforts to transform the DOD and have been informed that the
    Army is aggressively operationalizing the concepts of a lighter force
    and evolution into the BCT units of action. However, I have two
    concerns:
        First, I am aware that as part of your reorganization you have
    developed plans to fundamentally change the mission tasking of over
    100,000 troops or 20 percent of the Army. In this process you intend to
    eliminate the following types of units or battalions: 24 artillery, 10
    air defense, 11 engineer, 19 armor, and 65 ordnance. In addition, you
    intend to convert these for high demand units such as 149 MP companies,
    16 transportation units, and several civil affairs units. I believe
    that as we move forward, we need to know the specific impacts this
    massive change will have on Army procurement requirements for major end
    items. I am especially concerned about armor, wheeled vehicles, and
    aviation requirements for the Future Years Defense Program (FYDP) as
    projected. In addition, a sense of the impact to operating costs,
    spares, and training dollars as the old units are eliminated and new
    units are created is necessary.
        Second, I have seen in the press that the manning for the BCT will
    be between 4,000 and 5,000 troops. At 48 brigades, this accounts for
    about only half of the Army's current authorized end strength or
    approximately 240,000 troops at most. What then are the specific
    transformation plans for the other half of the Army?
        General Schoomaker. The 100,000 troops restructured to address the
    rebalancing of force structure within the active component/Reserve
    component affects about 12 percent of the Army's combat structure. This
    initiative has been captured in three major phases: global war on
    terrorism requirements; Secretary of Defense guidance on utilization
    and employment of Reserve component forces; and recent Army efforts to
    minimize impacts on high demand units, establishing trainees,
    transients, holdees, and students (TTHS) accounts in both the Army
    National Guard and the Army Reserve; and decreasing Reserve component
    over structure to help shape more ready and relevant Reserve component
    forces. These types of force structure changes are typical of the force
    sizing analysis and programming the Army goes through for each FYDP
    submission. The equipping impacts for the force structure changes
    generated in phase two required reprogramming $181.2 million of
    equipment procurement in the POM 2005-2009. The impacts on manning,
    equipping, and training generated by the changes in phase three will be
    captured in the upcoming POM. Armor, wheeled vehicles, and aviation
    requirements for the FYDP, as previously projected, will reflect these
    approved force structure changes. However, projected requirements from
    these changes should have minimal impacts on the procurement of major
    end items due to the projected cascading of equipment and the force
    designs of the BCT units of action. Additionally, equipment for units
    designated for inactivation or conversion will cascade to fill
    shortages as the Army reorganizes to meet global war on terrorism
    operational demands and evolves structure to the new BCT units of
    action. Major aviation end items are not eliminated, but rather
    restructured under a new design. Overall, this initiative will
    rebalance the forces and improve their readiness to meet operational
    demands.
        Army transformation is a comprehensive effort intended to reinvent
    the Army at strategic, operational, and tactical levels. The 48 BCTs
    (43 maneuver brigade units of action and 5 Stryker BCTs) will comprise
    the ``tip of the spear'' at the tactical level, but they require
    command and control and a broad range of support to deploy and
    successfully accomplish their assigned missions. By fiscal year 2009,
    the strength of the 48 BCTs is estimated at approximately 168,000
    soldiers. The remainder of the deployable operating force will total
    approximately 171,000 soldiers and will include Special Operations
    Forces (SOF), combat support, combat service support, and command and
    control elements.
        Combat support and combat service support elements will be
    organized under support units of action (SUAs) and doctrinally
    configured to operate with and in support of the maneuver brigade units
    of action. Variants of the SUA will include the Aviation SUA (full
    spectrum multifunctional aviation operations), Protect SUA (force
    protection and security to lines of communication and rear areas),
    Reconnaissance and Surveillance SUA, Strike SUA (lethal and non-lethal
    strikes), and Sustain SUA (logistical support).
        The nature of modern operations requires that Army command and
    control formations become more flexible than our current divisions and
    corps. Above the BCT level, two higher units of employment (UEx and
    UEy) will orchestrate tactical engagements into battles, major land
    operations, and when designated as a joint task force, campaigns. The
    design of both the UEx and UEy incorporates the capability for either
    to become a joint task force for smaller scale contingencies with
    little or no augmentation.
        The generating force constitutes the part of the Army, which is
    generally nondeployable, but performs title 10 functions and provides
    critical support to the operating force. Accomplishing such functions
    as recruiting, institutional training, acquisition, and power
    projection platform operations, the generating force will support the
    transformation, becoming more efficient, and declining in military
    strength to approximately 85,000 by fiscal year 2009.
        Finally, as a consequence of force stabilization initiatives, the
    Army anticipates reducing the number carried as TTHS from 63,000 to
    58,000.
                                     ______

                  Questions Submitted by Senator Susan Collins
                                ship procurement
        49. Senator Collins. Admiral Clark, I very much appreciate the
    commitment you have shown in your budget to fully fund the construction
    of three DDG-51 Arleigh Burke-class destroyers. We are entering a very
    crucial period as the DD(X) destroyer program begins to ramp up. I
    appreciate that the DOD's fiscal year 2005 budget submission begins the
    funding for the construction of the first DD(X) destroyer. I am,
    however, concerned about the DOD future shipbuilding plan, specifically
    the transition between the DDG and DD(X) programs. The Navy is
    apparently slipping the construction of the second DD(X) destroyer 1
    year, from fiscal year 2006 to fiscal year 2007. If this occurs, it
    will be the first year in over 20 years that our Navy will not be
    procuring a major surface combatant. This threatens to exacerbate an
    already significant problem with regard to overall fleet size, as well
    as significantly disrupt our Nation's industrial base. I would like you
    to comment on the impact a year without destroyer procurement would
    have on the continuing reduction in the size of the fleet and the
    viability of our industrial base.
        Admiral Clark. I am on record before Congress as saying that I do
    not believe we have enough ships in the inventory for the needs of this
    Nation, and we are doing all that we can to make up for the acquisition
    holiday in shipbuilding during the decade of the 1990s. This budget
    request puts us on the right track--in the form of $11.1 billion in the
    Shipbuilding and Conversion, Navy (SCN) account--to deliver the kind of
    force structure that we need for the 21st century. That said, fiscal
    year 2006 is going to be a tough year for us. We are going to have to
    make some hard decisions, and one of those decisions is about the
    procurement of a DD(X). If I thought we had the money to accelerate the
    procurement of DD(X) while balancing that against our other
    commitments, then we certainly would do that. At this point, it appears
    that we will not have that kind of flexibility. Let me assure you,
    however, that I am sensitive to the business needs of our partners in
    the shipbuilding industry as well as to the importance of maintaining
    the unique skills required to build the best surface combatants in the
    world. In order to mitigate the impact of the transition on the
    industrial base, we have developed a DD(X) acquisition strategy to
    provide the best value for the Navy with considerations for industrial
    base viability. This includes a portion of the lead ship detail design
    and construction effort being performed at General Dynamics Bath Iron
    Works, as well as Northrop Grumman Ship Systems.

        50. Senator Collins. Admiral Clark, as of January 30, 2004, our
    fleet consists of only 294 ships. You have suggested that a more
    appropriate fleet size would be approximately 375 ships to meet current
    and future threats. The current rate of Navy ship procurement falls far
    short of meeting this goal. I realize that the ships of the future will
    have greater capability than those ships built only a decade or two
    ago, but part of a fleet's capability is its numbers, particularly when
    the U.S. might face multiple challenges in different parts of the world
    and worldwide presence has long been a mission of the Navy. How do you
    envision the U.S. Navy's capability to meet current and growing
    worldwide threats with less than a 300-ship Navy?
        Admiral Clark. The shipbuilding program provides for investment in
    new construction to deliver the kind of force structure we need for the
    21st century. Fundamentally, that means a force structure measured in
    terms of aggregate capabilities as well as the number of hulls.
    However, as you have correctly pointed out, numbers do matter if we are
    to have sufficient capacity to deliver those capabilities to the far
    corners of the Earth. Our budget request provides for a steady rise in
    that number, reaching 308 in fiscal year 2009.
        The most pressing challenge we face is obtaining the new
    capabilities we need to shape the Navy of the future and address the
    threats you have addressed. We need the DD(X) and LCS capabilities in
    the fleet as soon as possible. LCS in particular provides the kind of
    platform that is designed to take on the enemies we face in the post-
    September 11 environment. We are at risk without it. In the interim, we
    are maximizing our existing capability to meet the challenging threats.
    This past year led to the restructuring our training and maintenance
    processes under the Fleet Response Plan (FRP) and Sea Swap in order to
    derive the maximum amount of operational availability from each of our
    ships and air wings.

                                 maritime norad
        51. Senator Collins. Admiral Clark, I've been following with
    interest your thoughts about a ``maritime'' North American Aerospace
    Defense Command (NORAD). Do you anticipate that idea will become
    policy?
        Admiral Clark. While I cannot say for sure that this will become
    policy, such an approach has three elements that I consider important
    in providing homeland security and force protection. First, is my view
    that the Nation needs to develop the global maritime awareness that can
    reduce our port vulnerability. We can best do this by partnering with
    the U.S. Coast Guard (USCG) and with our allies to ensure timely
    dissemination of intelligence and by assisting in littoral
    identification and tracking of contacts of interest and/or concern.
    Second, we need to better define and enhance naval roles in global
    merchant ship tracking in relation to Navy homeland security/homeland
    defense missions. The third element would be to identify, in
    conjunction with the USCG, the technologies required for global surface
    vessel tracking and identification and develop a concerted plan for
    their implementation.

        52. Senator Collins. Admiral Clark, you noted in one speech that on
    a small scale, San Diego has a maritime warning center staffed by the
    Navy, Coast Guard and harbor police. Is there a maritime surveillance
    infrastructure in place that covers the Nation and the world that would
    serve as a basis for a ``maritime NORAD''?
        Admiral Clark. We do not have an integrated national maritime
    surveillance infrastructure in place today. The San Diego warning
    center you are referring to is one of two prototype Joint Harbor
    Operations Center (JHOCs), with the second prototype in Hampton Roads,
    Virginia. Navy and Coast Guard have worked together closely on this,
    and have agreed to co-share costs for development of these two sites.
    Our goal is to enable Navy and Coast Guard to more closely support each
    other in our shared harbor security responsibilities.

                                ``one shipyard''
        53. Senator Collins. Admiral Clark, I would like you to bring us up
    to date on the ``One Shipyard'' concept and how that will improve the
    capability, efficiency, and the viability of our naval shipyards, such
    as Portsmouth Naval Shipyard in Kittery, Maine, which has been
    designated as a center of excellence for the overhaul and refueling of
    our nuclear submarines.
        Admiral Clark. ``One Shipyard'' is our conceptual approach to
    improved use of the ship.maintenance and construction industrial base
    through resource and infrastructure sharing.
        Our objective is to capitalize on shipyard availability and
    employee skill sets in a way that provides more effective and efficient
    use of the limited maintenance resources needed to support our
    readiness; to provide better workload predictions and stability to our
    public and private shipyards; and, to leverage unique employee skill
    sets across the span of the industry in a way that lets us minimize
    some of the personnel strain of homeport shifts for our sailors between
    deployments.
        This should result in improved health and stability for both our
    private and public shipyards, the right readiness for our Navy and
    better employee opportunity.

                               ballistic inserts
        54. Senator Collins. General Schoomaker, given that the U.S. has
    been in Iraq for nearly a year and that we had some indication that we
    would possibly go into Iraq for several months prior to that, how is it
    that the number of ballistic inserts for the troops' body armor failed
    to keep up with the number of troops in-theater?
        General Schoomaker. Prior to the war, the Army was procuring and
    fielding Interceptor Body Armor (IBA) to all units preparing to
    participate in OIF. During the first part of the war, the major combat
    operations phase, our soldiers were adequately equipped with IBA. Our
    requirement for IBA was considerably less at the onset of the war
    because tank crews and other armored vehicle crews did not require IBA
    as their vehicles protected them. Since major combat operations have
    ended, our requirements for IBA have substantially grown due to a
    different operational environment and guidance from the commanders
    directing OIF. Today, most of our soldiers are dismounted from their
    armored vehicles as they conduct dismounted patrols throughout the
    Iraqi countryside in an effort to have closer contact with the Iraqi
    people.

        55. Senator Collins. General Schoomaker, why didn't we have enough
    ballistic inserts for the troops' body armor?
        General Schoomaker. Prior to the war, the Army had set different
    procurement objectives for the Outer Tactical Vest (OTV) and the Small
    Arms Protective Inserts (SAPI), the two major components of IBA. Since
    then, the Army's updated procurement objectives for both OTVs and SAPI
    are now the same. Therefore, our SAPI procurement was accelerated to
    our current rate of 25,000 sets per month in order to meet our current
    IBA requirements. Given the absolute critical nature of this life-
    saving equipment, we must allow the manufacturers' requisite time to
    meet quality production standards. The strictest quality control
    measures are in place to ensure no soldier or civilian is needlessly
    placed at risk in a substandard piece of body armor.

        56. Senator Collins. General Schoomaker, how can we change the
    procurement system to ensure that our troops have the necessary gear
    when they are sent into combat, not a year after it started? I ask this
    question not only for the body armor, but other equipment needs which
    may emerge as well.
        General Schoomaker. We can do two things. First, we can plan for
    potential requirements beyond those in approved program levels and
    second, we can add options into critical contracts to allow for
    accelerated production. This will encourage more proactive thinking
    about contingency requirements and potential obstacles to rapid
    production and may reduce risk. However, this will not eliminate all
    risk. The noncontiguous urban threat of OIF necessitated that every
    soldier and DOD civilian in theater receive body armor. This was a
    divergence from the original guidance to issue only combat soldiers
    body armor. Once we recognized an increased risk, the requirement
    changed and the procurement system then used all possible means to
    respond. We will work to improve our procurement system, but we cannot
    eliminate all risk from changing threats.

                                reports of abuse
        57. Senator Collins. General Schoomaker, The Denver Post has
    recently reported that female soldiers are returning from Iraq and
    seeking assistance from civilian rape-crisis centers. I know Secretary
    Rumsfeld has ordered an inquiry, but can you tell me what the Army is
    doing to investigate these reports and ensure that women who wear the
    uniform are protected from such abuse?
        General Schoomaker. Our U.S. Army Criminal Investigation Command is
    actively investigating or has completed investigations in 86 sexual
    assault crimes reported in the U.S. Central Command (CENTCOM) area of
    responsibility (AOR). When the evidence warrants, our Army takes a
    tough and aggressive stance on prosecuting sexual assault cases. Our
    Army is committed to providing strong support to victims of all crimes
    whether in a deployed environment or in garrison. As with all criminal
    allegations, there is a presumption of innocence until a case is fully
    investigated and, if appropriate, tried in a court of law. As you are
    well aware, the system that you have given us--through the Uniform Code
    of Military Justice (UCMJ)--provides commanders with the necessary
    process to ensure good order and discipline in our force. By protecting
    the rights of the accused and victims alike, the UCMJ provides the
    tools necessary to ensure the integrity of our investigatory and
    military justice system.
        The Army is committed to ensuring that the victims of sexual
    assault are properly cared for and treated and that their medical and
    psychological needs are properly met. Currently, we are assessing our
    Army's policies and programs to determine whether they properly provide
    appropriate support services to victims both in garrison and in a
    deployed environment. To ensure that our current policies and programs
    are effective, the acting Secretary of the Army has directed the
    establishment of a task force to conduct a detailed review of the
    effectiveness of our Army's policies on reporting and properly
    addressing allegations of sexual assault. This review will examine our
    policies, programs, procedures, and training with regard to the
    prevention of sexual assault. The task force will further review the
    processes in place to ensure a climate exists where victims feel free
    to report allegations and leaders at every level understand their
    responsibilities to support those victims. This task force will render
    its report by the end of May 2004. However, if the task force
    identifies actions, which can be taken sooner to improve the Army's
    policies, programs, or procedures, our Army will implement them as
    appropriate.
                                     ______

                 Questions Submitted by Senator Saxby Chambliss
                          vision for the navy reserve
        58. Senator Chambliss. Admiral Clark, the Navy deserves great
    credit for thinking innovatively about how to manage the increased
    demands placed on the fleet and your sailors, and in developing the FRP
    to allow for greater availability, deployability, and surge capacity of
    our carriers and air wings. The other Services have similar challenges
    as the Navy and are also taking steps and thinking creatively about how
    to meet increased demands without increasing people or resources. The
    Reserve components play a major role in all of our Services and have
    made enormous contributions over the past several years. Although I
    believe the Reserves should be managed in a unique way from a personnel
    standpoint, I am in favor of giving the Reserve components the same
    robust responsibilities and demanding of them the same level of
    performance as the Active Force. With this comes resourcing the
    Reserves with adequate hardware and committing them to high-level
    training requirements. If we do not do this, we cannot expect
    reservists to want to stick around just to ``pinch-hit'' or perform
    tasks that no one else wants to do. With this in mind, can you share
    your vision for how you plan to take advantage of your Navy Reserve
    sailors in a way that truly capitalizes on their capabilities and
    desire to serve the Navy and the United States?
        Admiral Clark. My vision for the future is a seamlessly integrated
    and balanced Active and Reserve Force rather than the two-tiered system
    that has resulted in separate standards and procedures in place today.
    This is a two-way integration. We will balance the force by instilling
    one standard for training and readiness, ensuring Reserve Forces have
    access to front-line equipment, and streamlining headquarters functions
    in a way that will support the seamless integration of Reserve Forces
    when they are needed.

                        c-17 public-private partnership
        59. Senator Chambliss. General Jumper, I believe that public-
    private partnerships provide great synergy between the government and
    industry and represent a great capability to provide extended depot
    maintenance for our military hardware. I am pleased with the progress
    the Air Force has made with the C-17 partnership in particular and am
    very pleased to hear that the Air Force will consider software as a
    ``core'' requirement and resource our air logistics centers
    appropriately to accomplish this core workload. Can you outline how
    software maintenance and sustainment for the C-17 program will be
    accomplished and how the government and industry can partner together
    to ensure the Air Force's logistics and sustainment requirements in
    this area continue to be met?
        General Jumper. The C-17 System Program Office (SPO) has developed
    preliminary strategies and requirements necessary to establish
    Government organic software support capability for the C-17 aircraft.
    In the near term, the Air Force and Boeing Company will be partnering
    to develop C-17 component diagnostics software Test Program Sets (TPSs)
    at all three Air Logistic Centers. In the long-term, the Air Force and
    the Boeing Company will partner to establish C-17 aircraft operational
    flight program software maintenance capability.
                                     ______

                 Questions Submitted by Senator Lindsey Graham
                               air national guard
        60. Senator Graham. General Jumper, since the 1950s, the Air
    National Guard has followed a policy of maintaining at least one flying
    mission in every State. This policy is no doubt due to the invaluable
    contributions that the Guard provides not only to the national defense
    but also in recognition of the positive role Guard members play in
    their communities offering most individuals their only exposure to the
    military. Do you intend to continue that longstanding policy?
        General Jumper. I appreciate your long-standing support for our
    Nation's men and women in uniform as well as your concern for the
    continued relevance of our citizen airmen of the Air National Guard.
    The support of Congress will be critical as we transform the DOD to
    meet the national security requirements of the 21st century.
        The DOD anticipates an overall reduction in the number of manned
    aircraft as we transform. This is due not only to constrained
    resources, but also the capabilities the Nation will require from the
    DOD in the future. Information age warfare requires a different
    portfolio of capabilities than industrial age warfare, and we are
    transforming the joint force to meet that challenge. Also, the aircraft
    the DOD is planning on procuring will be vastly more capable than our
    current legacy systems, which will result in a lower number of aircraft
    being procured. The DOD is also very interested in the potential of
    unmanned systems.
        The USAF is committed to ensuring the Air National Guard is a full
    and equal partner in the Air Force of the future. I strongly support
    their efforts to ensure the future relevancy of the Air National Guard
    in their transformation plans. Our shift to capabilities based planning
    and the resulting shift in focus away from legacy systems require a
    commensurate change of focus by the Air National Guard. Lieutenant
    General James has developed a strong transformation vision and I am
    confident that his approach will help to ensure a relevant Air National
    Guard.
        The Air Force and Air National Guard assure me their intent is to
    maintain a Guard flying unit in every State; however, first and
    foremost, they are committed to providing a relevant and more capable
    Air National Guard presence in every state, to provide required
    capabilities to the joint force. While it has always been a goal, there
    is no stated policy to keep a flying unit in each State. The DOD
    believes such a policy would not be in the best interests of the
    Nation. The Air Force and Air National Guard leadership require the
    flexibility to transform the Air National Guard to ensure it has the
    required capabilities needed for the future.

        61. Senator Graham. General Jumper, in addition, can you provide me
    with a list of the facilities on the east coast that offer
    opportunities for blackout, runway, and field operations?
        General Jumper. Senator Graham, we have two Air National Guard
    facilities on the east coast which have backup power generators in case
    of blackout that can be used for field operations. The two units are
    the 102nd FW, Otis AGB, Massachusetts and the 169th FW, McEntire AGS,
    South Carolina.

                               military retention
        62. Senator Graham. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, in your opinion, what effect will the lack
    of targeted pay raises have on military retention in light of improving
    economy and the current strain on military forces?
        General Schoomaker. Attitude and opinion surveys of the active Army
    have consistently shown that the amount of basic pay is one of the top
    reasons why soldiers report that they are leaving or thinking about
    leaving the Army before retirement. In the fall 2003 Sample Survey of
    Military Personnel, 14.4 percent (second most important) of enlisted
    personnel and 6.7 percent (third most important) of officers cited
    amount of basic pay as one of the most important reasons for leaving or
    thinking about leaving the Army before retirement.
        Admiral Clark. Although our analysis may support further targeted
    pay raises in the coming years, it really is too soon to tell what, if
    any, effect the lack of targeted pay raises may have on retention this
    year. But, I can tell you that retention in the Navy has never been
    better, thanks in large part to the support of your committee for both
    targeted and uniform pay raises. Together, we have made great strides
    in closing the gap between military and private sector pay for those
    with comparable levels of education and experience.
        The Secretary of Defense is appointing an Advisory Committee on
    Military Compensation to examine, among other things, future targeted
    raises. I do believe that targeted pay raises and other incentive pays
    will be incredibly important in our future, not only for retention, but
    for our ability to shape and develop the kind of skills and behaviors
    we will need for our high-tech future as well.
        General Hagee. The targeted pay raises provided in fiscal year 2000
    through fiscal year 2004 accomplished their objectives to adjust basic
    pay for those grades where the pay differentials needed to be
    comparable to the private sector and ensure quality force retention. At
    this time, we should be able to concentrate on across the board pay
    raises for all pay grades. Judicious use of special pays and retention
    bonuses should be pursued in those exceptional cases where recruitment
    or retention are challenges.
        General Jumper. Targeted pay raises over the past several years
    have made tremendous strides in closing the gap between military and
    comparably educated civilians. The pay gap currently exists with our
    mid and senior enlisted grades. Over the past 2 years, our retention in
    these grades has improved and we anticipate retention remaining stable.
    Over the past 3 years we have heavily targeted these grades to close
    the gap, in an effort to meet the recommendations of the 9th
    Quadrennial Review of Military Compensation (QRMC). The 9th QRMC
    recommended that military pay reach the 70th percentile of what
    comparably educated civilians earned. The 2001 targeted pay raises
    closed the gap by 23 percent and subsequent targeting has made
    significant progress. The administration's fiscal year 2005 3.5 percent
    across-the-board pay raise, coupled with past targeting efforts, will
    close the gap by 70 percent.

        63. Senator Graham. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, what effect do you believe the current stop-
    losses will have for long-term recruiting and retention goals?
        General Schoomaker. We believe recruiting and retention goals for
    the Army's stop-loss programs will not affect the long-term. Stop loss
    does not normally affect the accessions achievement mission. However,
    prior service recruiting into the National Guard and Army Reserve has
    been affected because of regular Army stop loss.
        It is still too early to determine whether Army stop-loss programs
    have negatively impacted active Army retention program. We are slightly
    below glide path with regards to our annual retention mission, but
    remain guardedly optimistic we will achieve the mission by the end of
    the fiscal year. As the Army implements force stabilization
    initiatives, the need to use stop-loss programs will diminish over
    time.
        Admiral Clark. Because Navy's use of stop-loss was in effect for
    only 1 month and affected only 2,600 Navy Field Medical Service
    Technicians (Hospital Corpsman) out of our total Active and Reserve
    Force of more than 463,000 personnel, we do not believe it will have an
    impact on long-term recruiting nor on retention.
        General Jumper. Air Force stop-loss ended in June 2003 and by
    January 2004, all affected personnel either retired, separated,
    reenlisted, or decided to stay. Today, no Air Force personnel are
    affected by stop-loss. Stop-loss has had little or no negative impact
    on retention and recruiting as the Air Force is currently exceeding
    both retention and recruiting goals.
        General Hagee. The Marine Corps has not used stop-loss in fiscal
    year 2004.

        64. Senator Graham. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, could you comment on the plan mentioned by
    Secretary Rumsfeld and General Pace to restructure the Reserve
    component to utilize the ``most pertinent skill-sets?'' How do you plan
    to accomplish this goal in light of the DOD's stated goal of managing/
    reducing its reliance upon the Guard and Reserve?
        General Schoomaker. The Army actively seeks to rebalance its
    current active component/Reserve component mix to best match the
    current strategy and 1-4-2-1 force sizing construct. For fiscal years
    2004-2009, the Army made significant headway in reducing the stress
    placed on existing high demand units, both active component and Reserve
    component, by converting about 19,500 spaces in less utilized force
    structure. In response to the directives set forth in the Secretary of
    Defense's July 9, 2003, memorandum on Rebalancing Forces, the Army took
    actions through two program change packages, to rebalance approximately
    10,000 spaces of active component and Reserve component force structure
    required in the first 15 days of a rapid response operation. This
    mitigates stress on select Reserve component high-demand units. The
    Army intends to convert an additional 80,000 spaces of lower priority
    force structure to meet future operational requirements. In addition to
    these actions, I directed a thorough review of all Army force structure
    with the intent of improving the readiness and deployability of Army
    units and ensuring a correct balance between active component and
    Reserve component forces. The end state of these self-initiated actions
    will be a more relevant Army, properly balanced and postured as a full
    joint warfighting partner.
        Admiral Clark. These two goals are not mutually exclusive. In fact,
    I see them as complementary. We are reducing our overall reliance upon
    the Reserves by rebalancing the force in some key areas; specifically:

             Anti-Terrorism/Force Protection (AT/FP): Active
            component strength increases in our dedicated security forces
            (officer, enlisted, and civilian), permit us to meet day-to-day
            or elevated AT/FP requirements. Even in situations requiring
            the highest levels of force protection readiness, we can
            fulfill those requirements for a short period with active
            component personnel before resorting to Reserve component
            augmentation.
             Naval Coastal Warfare (NCW): We have created
            additional NCW capability in the active component by
            establishing the Mobile Security Force (MSF), and
            reapportioning end strength from accelerated ship
            decommissionings. Having an active component NCW capability
            relieves the Reserve component from meeting each and every
            short-term and short-notice NCW requirement.
             Naval Aviation: Planning is underway to merge certain
            aviation missions that are resident in both the active
            component and Reserve component by converting some independent
            Reserve component squadrons into active component squadron
            augment units. This will have the benefits of populating active
            component squadrons with highly experienced Reserve component
            pilots, improving equipment commonality, and reducing (but not
            eliminating) the need for Reserve component maintenance
            personnel and infrastructure.
             Fleet Marine Force (FMF) (HM8404) Corpsmen: Several
            hundred Reserve component HM8404 corpsmen billets in support of
            Reserve Marine Corps units have been reclassified as Functional
            Area Code (FAC) A, meaning that in the event of mobilization,
            active duty HM8404 corpsmen will transfer from shore duty at
            naval hospitals to fill these requirements. Their hospital
            billets will be backfilled with Reserve component corpsmen as
            necessary to sustain hospital operations. The HM8404
            classification is historically difficult to recruit, train, and
            retain in the Reserves. This change will ensure Reserve Marine
            Corps units are properly manned when required, and will
            effectively employ Reserve component corpsmen at naval
            hospitals using skills that are easier to gain and maintain in
            the Reserves.

        General Hagee. The Marine Corps is unique due to the fact that our
    Reserve component mirror images our active component and has the
    primary mission to augment and reinforce it. We traditionally integrate
    our active component/Reserve component units within our Marine Air-
    Ground Task Forces using the Total Force approach. In regard to the
    active component/Reserve component mix, we are constantly reviewing our
    mix based on lessons learned. We are currently getting ready to kick-
    off a general officer lead review within the Marine Corps to address
    this specific problem.
        General Jumper. The Air Force has always had a strong relationship
    with our Reserves. The Air National Guard and Air Force Reserve operate
    side-by-side with our Active Force, both in times of peace and times of
    conflict. We continue to enjoy a great spirit of volunteerism that
    complements the Active Force, and hinges on the professionalism,
    readiness, and front-line equipment of our Active Reserve Component
    (ARC). We seek to preserve the relevance of the ARC, while not
    overtaxing them with an operational tempo that is insensitive to the
    part-time nature of the Reserves. We are transforming as a Total Force
    Team--in the technologies we all use, the operational concepts we
    employ, and the structures under which we are organized. Given the
    increased capabilities of newer weapon systems and the fiscal
    realities, the Air Force is not necessarily planning to recapitalize
    our fleet on a one-for-one basis. Furthermore, the pending Base
    Realignment and Closure (BRAC) actions will focus on reducing excess
    capacity in our installations across our total force. These factors,
    combined with the increased crew ratios called for by the capabilities
    of our emerging weapon systems, call for innovative management of our
    most valuable asset, our people. The Air Force plans to capture the
    talent and experience of our reservists and guardsmen by integrating
    our active and Reserve units as both migrate into the newest weapons
    systems.
        As we move units into emerging mission areas, we are consciously
    placing guardsmen and reservists in missions least disruptive to their
    dual status as members of both the military and the civilian
    workforce--those areas that exploit reach-back to the United States
    while supporting operations abroad. An example of this would be the
    increased use of the Guard and Reserve in space, intelligence, and even
    UAVs. These efforts also capitalize on the high tech skills these
    members bring from their civilian experience. As we make these changes,
    we are mindful of the unique cultures of the Guard and Reserve. We seek
    to preserve those cultures and their associated strengths. We are
    aggressively working our force development programs to ensure they
    address the needs of our total force, at both the personal and
    organizational level. We take great pride in leading the DOD in the
    integration of our Reserve component, and will make the pertinent skill
    sets of the Air National Guard and Air Force Reserve central to our
    transformational efforts.

                                     earmyu
        65. Senator Graham. General Schoomaker, recently, retired Sergeant
    Major of the Army Jack Tilley said eArmyU was the best thing the Army
    has ever done for its enlisted soldiers. Currently, how many posts
    offer eArmyU, and do you believe the program should be extended Army-
    wide?
        General Schoomaker. eArmyU is currently implemented at 14
    installations. However, soldiers have rotated and are participating
    from locations Army-wide, to include Iraq. The program is a good
    retention tool--21 percent of participants have reenlisted or extended
    to be eligible. By offering unprecedented access, choice, and
    flexibility in an online learning environment, we are attracting
    soldiers who have never taken college courses before at a rate of 27
    percent. Student satisfaction surveys indicate that soldier morale has
    improved. Expanding eArmyU will increase soldier access to education
    enabling them to fit their continuing education around their duties,
    family time, field training, and other obligations. Because we do not
    know what the total demand for this program is, it is difficult to
    determine the cost. We are currently assessing the cost for program
    expansion.

               reduction in training dollars for reserve soldiers
        66. Senator Graham. General Schoomaker, we are all cognizant of the
    very significant contributions of the Reserves to ongoing contingency
    operations in Afghanistan and Iraq as well as other locations in the
    global war on terrorism. Indeed, it is very clear to me that we could
    not effectively wage this war without our citizen soldiers, sailors,
    airmen, and marines.
        I am certain that you and your colleagues in the DOD have long
    since carefully calculated the offsets resulting from members of the
    Reserve component being placed on active duty and mobilized and paid
    with active duty appropriations. I further assume that the President's
    budget request reflects those offsets.
        What I am concerned about is the need to train those members of the
    force who have not yet been mobilized and those who have been mobilized
    and returned home to their units. Can you assure the members of this
    committee that there is sufficient funding in the Reserve component's
    budget for fiscal year 2005 to support the training requirements to
    maintain and restore their mobilization readiness?
        General Schoomaker. The fiscal year 2005 Reserves training budget
    ensures the funds necessary to conduct military occupational specialty
    (MOS) training (individual training), professional military education
    (PME) training (leader training), and the necessary OPTEMPO to support
    collective training for those units preparing for mobilization and
    deployment while in a Reserve status, as well as, enabling recently
    demobilized units to maintain their readiness edge. As the OIF/OEF
    missions stabilize and the Army moves to a train-alert-deploy strategy,
    ample time will be available for Reserve component soldiers and units
    to meet C1/C2 readiness standards prior to mobilization.

        67. Senator Graham. General Schoomaker, I know that the cost is
    significant and that the Reserves' training budget reflects a reduction
    of more than $600 million in fiscal year 2005. Can you give me some
    idea of how you may have reached the requested budget figure and how it
    is related to the level of funding needed to support the readiness
    training for those who remain in and return to their Reserve unit? I
    would hate to see the vital recruiting and retention efforts of our
    Reserve Forces undermined by funding reductions in their training
    accounts, reductions that sap readiness and morale and penalize the
    very men and women who have served so bravely and so well at such
    sacrifice to themselves, their families, and communities.
        General Schoomaker. The offsets for the fiscal year 2005 reduction
    of $600 million in Reserve component training budget reflects the
    projected mobilization and deployment of 150,000 Reserve soldiers to
    support the ongoing global war on terrorism missions. The $600 million
    represents a cost avoidance of the drill pay and annual training pay
    for those soldiers mobilized since their pay and allowances are paid
    from the active duty military pay account. As I mentioned above, the
    fiscal year 2005 Reserve training budget ensures the funds necessary to
    conduct MOS training (individual training), PME training (leader
    training), and the necessary OPTEMPO to support collective training for
    those units preparing for mobilization and deployment while in a
    Reserve status, as well as enabling recently demobilized units and
    soldiers to maintain their readiness edge.
                                     ______

                 Questions Submitted by Senator Elizabeth Dole
                                  end strength
        68. Senator Dole. General Schoomaker, while end strength is
    certainly an area of concern, I am more concerned about force mix
    particularly, the total force of active, Reserve, and Guard. How are
    you addressing the short-term issue of manning high demand career
    fields?
        General Schoomaker. The Army is committed to manning skills
    critical to the successful execution of the global war on terrorism.
    Thus, the Army has taken several steps to ensure these jobs remain
    filled. First, when possible, individual active Army soldiers are
    reassigned to deployed units to fill critical requirements. To minimize
    the need for replacements, the Army offers monetary bonuses to soldiers
    willing to reenlist in, or re-classify to, many high-demand career
    fields. Concurrently, recruiting efforts focus on enlisting soldiers
    into these skills. However, it takes time to recruit and train these
    new soldiers, and they do not have the experience or advanced training
    necessary for some jobs.
        The Army also relies upon Individual Mobilization Augmentee (IMA)
    and Individual Ready Reserve (IRR) soldiers, retiree recalls, various
    other voluntary mobilizations, and mobilized Reserve and National Guard
    units to augment the manning efforts. An IMA is an individual reservist
    who is pre-assigned to an active Army, DOD, or other government agency.
    The IRR is an Army manpower pool primarily consisting of individuals
    who have had training, have served previously in the active component
    or the SELRES, and may have some period of mandatory military service
    obligation remaining. The IRR consists of trained soldiers who may be
    called upon to replace soldiers or fill vacancies in Reserve or active
    units.

        69. Senator Dole. General Schoomaker, in your proposal to reassign
    some units (namely air defense and artillery units) to units such as MP
    and civil affairs, are we sacrificing a capability of a core mission in
    order to meet a short-term requirement?
        General Schoomaker. No, the defense strategy emerging from the 2001
    Quadrennial Defense Review (QDR) had significantly different
    requirements than the previous strategy. The Army recognized a need for
    change to support a new force-sizing construct and made plans to divest
    of cold war structure to meet the demands of the emerging strategic
    environment. We conducted extensive analyses to ensure we retain the
    required capabilities, including air defense and artillery, to conduct
    the full range of missions.

                               guard and reserve
        70. Senator Dole. General Schoomaker, with this month's deployment
    of North Carolina's 30th Heavy Enhanced Separate Brigade, I have been
    made painfully aware of some of the problems faced by our National
    Guard units as they mobilize. What are you doing to guarantee that
    these service members are expediently transitioned to active duty
    payrolls and that their lodging and subsistence are of the same quality
    as the active units training on the same bases?
        General Schoomaker. The Army National Guard is doing what it can to
    ensure that the transition to active duty is as smooth as possible. For
    example, we coordinate with the Power Projection Platforms to obtain
    the best lodging, subsistence, and training available. We also send
    support teams as necessary to solve problems. As regards to what the
    active component is doing in this area, we do not have information on
    that.

        71. Senator Dole. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, with the proposed 20-25 percent reduction in
    domestic facilities with BRAC and movement away from large, forward
    operating bases (FOBs), how are you planning to accommodate Guard and
    Reserve training, basing, and quality-of life needs when worldwide
    operations require a manpower ``spike''?
        General Schoomaker. A 20-25 percent reduction in domestic
    facilities through BRAC is not an official Army policy. Although there
    may exist excess capacity in DOD facilities, that excess does not
    equate to a comparable reduction in facilities through BRAC. The BRAC
    committee is taking into consideration all scenarios in developing
    recommendations for closures. Reserve units are not moved/changed as
    liberally as active units when it comes to domestic facilities. They
    are built around communities that can support and maintain a unit
    structure within a particular population. Once the BRAC recommendations
    are approved, the Army station and installation plans will have to be
    updated to take care of the future requirements of possible spikes in
    manpower.
        Admiral Clark. Because the majority of our Reserve training is
    conducted at the supported fleet active command, at designated training
    sites, or through the use of distance learning, there should be little
    impact on training accomplishment. With respect to basing, if Naval
    Reserve Activities (NRAs) are closed or reduced in numbers, we will
    seek efficiencies though joint base ventures with the other military
    Services in order to optimize resources across DOD. This same kind of
    collaborative effort applies to quality of life needs as well, through
    the use of other Service Family Support Centers, military health care
    facilities, recreational facilities, etc.
        General Jumper. First, as you are aware, there are no specific Air
    Force goals or target lists for the upcoming 2005 congressional
    authorized BRAC. Not only does the BRAC process allows us to dispose of
    excess facilities, it frees up valuable funds to fully sustain our
    needed facilities and systems so they remain effective through their
    expected life. We owe to our professional airman who voluntarily serves
    the Air Force and their nation a steady investment program to restore
    and modernize our critical facilities and infrastructure systems, while
    continually advancing our ability to protect our people and resources
    from the growing threat of terrorism. Second, today's airmen realize
    deployments are a vital part of the Air Force's critical mission of
    projecting air and space power globally. Our goal is to provide these
    expeditionary airmen and their families with the training, tools, and
    quality of life they need to continue to successfully sustain the
    mission. As we continue to support ongoing operations and prepare for
    an uncertain future, we are examining and acting on lessons learned
    from our recent experiences.
        We are continuing to pursue seamless Air Reserve component and
    active duty integration at home, leveraging the capabilities and
    characteristics of each component, while allowing each to retain their
    cultural identity. We continue to explore a variety of organizational
    initiatives to integrate how our Active, Guard, and Reserve Forces are
    based and trained. These efforts are intended to expand mission
    flexibility, create efficiencies in our Total Force, and prepare for
    the future. Today's Future Total Force team included a number of
    blended or associate units that are programmed or in use.
        Finally, the combat readiness of our forces is a direct result of
    the strides made in terms of quality of life for our airman and our
    families. For instance, the Air Force Reserve participated in the
    Federal Long Term Care Insurance Program to better provide long term
    care insurance coverage for its members and their families. This
    program affords members of the Air Force Reserve and Air National Guard
    insurance coverage for a variety of home and assisted living care
    requirements. Additionally, the National Defense Authorization Act for
    Fiscal Year 2004 provided improvements to the TRICARE Program in
    support of Air National Guard and Air Force Reserve members. These will
    pay dividends in the quality of life for our Guard and Reserve members.
        General Hagee. The Secretary of Defense has established a process
    for the 2005 round of BRAC that will assess all U.S. installations,
    both active and Reserve, equally. He has also established and published
    the final selection criteria to be used in the analytical process for
    making realignment and closure recommendations. These criteria include
    among others the ability to accommodate contingency, mobilization, and
    Future Total Force requirements at both existing and potential
    receiving locations to support operations and training. I believe the
    BRAC process will assure that sufficient and appropriate infrastructure
    is retained, as needed.

        72. Senator Dole. General Schoomaker, while I understand the
    temporary nature of many of the facilities now housing our Guard and
    Reserve units training for deployment, the deplorable state of some of
    those facilities is not understandable. How does this budget remedy
    this situation?
        General Schoomaker. The Army has a sustained, ongoing program to
    demolish excess facilities, especially World War II temporary wooden
    barracks and facilities. Unfortunately, the global war on terrorism has
    forced us to use some of the remaining World War II temporary wooden
    buildings. Recognizing the unacceptable state of some of those
    facilities, we are vigorously working to upgrade them with operations
    and maintenance, Army (O&MA) funds from the supplemental appropriation
    that supports global war on terrorism. In addition, we are developing a
    long-term solution to rebuild key mobilization and power projection
    centers at selected installations with military construction funds.
        Using available O&MA funds, the Army has repaired and upgraded
    temporary buildings and support facilities at installations where
    Reserve soldiers deploy, as well as other locations. These
    installations include Fort Lewis, Washington; Fort Leonard Wood,
    Missouri; Fort Carson, Colorado; Fort Benning, Georgia; Fort Stewart,
    Georgia; Fort Drum, New York; Fort Dix, New Jersey; Fort Eustis,
    Virginia; Camp Atterbury, Indiana; and Aberdeen Proving Ground,
    Maryland. Typical improvements involve latrines, showers, heating and
    air conditioning systems, smoke alarms, plumbing and electrical
    systems, lighting, floor coverings, ceilings, windows, and roofs. We
    will continue in fiscal year 2005 to improve the facilities from which
    our soldiers deploy.

        73. Senator Dole. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, while our latest military innovations have been
    significant in ``winning the war,'' we seem to have a way to go in
    ``keeping the peace.'' How does your Service's transformation vision
    address the need to maintain post-war stability operations or
    peacekeeping capabilities?
        General Schoomaker. The Army's transformation plan will provide us
    with a range of modular, interchangeable formations that can operate
    across the spectrum of warfare. We are adjusting our force structure,
    particularly that of the Army National Guard, to reduce our Cold War-
    era capabilities set with one more suited to current and future threats
    and missions. As an example, we are deactivating 22 National Guard
    field artillery battalions and using that opportunity to increase our
    force structure in such capabilities as MPs and civil affairs.
        Admiral Clark. The Navy transformation vision reflects a supporting
    role for stability operations and peacekeeping activities. The Navy
    will maintain maritime dominance gained during combat operations, such
    as by the mission-reconfigurable LCS and advances in undersea warfare.
    Where fire support is called for, warships like DD(X) and aircraft like
    the Naval JSF and FA-18E/F will support joint and coalition ground
    forces operating at significantly greater ranges inland. From the
    safety of the sea military and humanitarian/commercial material can
    rapidly enter the area. Lastly, distributed and networked naval forces
    will achieve an additional long term effect in support of the
    President's Proliferation Security Initiative, denying the use of the
    high seas to those trying to transport weapons of mass destruction
    (WMD) into or from the area.
        For sailors who regularly operate on or close to the shore in post-
    combat situations, the Navy works closely with other Services to
    provide effective protection. Naval Special Warfare, Naval Coastal
    Warfare, and Explosive Ordnance Disposal units utilize state-of-the-art
    force protection equipment and technologies to protect personnel. This
    not only includes such items as weapons, chemical, biological, and
    radiological (CBR) equipment, body armor and up-armored vehicles, but
    detection systems that provide forewarning and afford preemptive
    actions against various threats. Ships used to monitor sea lanes during
    stability operations are provided a variety of small arms, halogen
    lights, body armor, and night vision devices to aid force protection.
    The Shipboard Protection System will provide increased capability
    through incremental technology insertions.
        General Hagee. The institutional agility and tactical flexibility
    demonstrated by the Marine Corps' participation in ongoing stability
    operations in Iraq and Afghanistan reflect our larger and ongoing
    Marine Corps transformation process. Stability and peacekeeping
    operations are not new to the Corps, with a history that includes the
    Boxer Rebellion in China, the ``Banana Wars'' in the Caribbean, and
    multiple armed interventions in Haiti, the Dominican Republic, and
    Lebanon. More recently, marines and Marine units have supported
    peacekeeping and peace enforcement operations at length in both Bosnia-
    Herzegovina and Kosovo. Today, the Navy-Marine Corps Team continues to
    play a critical role in the global war on terrorism and in the
    establishment of stability and security throughout the world. During
    this past year, the Marine Corps, both active and Reserve, was engaged
    in stability and peacekeeping operations in the Arabian Gulf, the Horn
    of Africa, Liberia, the Georgian Republic, Colombia, Guantanamo Bay,
    and the Philippines.
        As the Nation's ``Force in Readiness,'' we principally prepare to
    fight and win our country's first battles. As a learning organization,
    however, we relentlessly adapt to develop the capabilities required to
    meet the demands of tomorrow, and there is no question that
    capabilities for peacekeeping and stability operations will continue to
    be required. While we constantly transform our total force, ongoing
    changes to our organization, equipment, and training will provide us
    with greatly enhanced capabilities for stability and peacekeeping in
    the Marine Corps of the next decades.
        Organizationally, we have recently conducted a Force Structure
    Review of the entire Corps, and are implementing a number of changes
    that will provide us an increased ability to more effectively
    accomplish missions across the range of operations. The reestablishment
    of our first active component civil affairs billets in decades along
    with additional Reserve civil affairs forces will provide us with the
    systematic ability to plan, coordinate, and conduct the civil-military
    operations (CMO) so necessary in these environments. Similarly, the
    addition of active component information operations (IO) and
    psychological operations (PSYOP) personnel will add non-destructive
    alternatives to our commanders' ``toolboxes'' during stability and
    security operations. By growing and reorganizing our intelligence,
    counterintelligence, and human intelligence (HUMINT) capabilities, we
    will enable our deployed operating forces to be both more effective and
    more efficient. A substantial increase in our explosive ordnance
    disposal forces will enhance our ability to deal with the common
    threats peacekeeping forces face, and we continue to examine
    alternatives to provide additional MP units. Finally, by increasing the
    number of our maneuver units, including additional infantry and light
    armored reconnaissance formations, we extend our ability to better
    influence action where it most matters--along city streets and across
    farmer's fields.
        The most decisive factor in success of these units will be the
    ability of the individual marine and his small unit leaders. Recent
    improvements in technology provide these marines with a wider array of
    capabilities. For example, the tactics and abilities of the junior
    leader are significantly enhanced by the fielding of the Advanced
    Combat Optical Gunsight (ACOG), the Personal Role Radio (PRR), and the
    PRC-148 radio. The ACOG is an internally adjustable, compact telescopic
    sight that can be used easily in low light or at night and enables more
    discriminate use of small-arms fire. The PRR is a small transmitter-
    receiver that allows patrolling warfighters to communicate over short
    distances, even through thick walls or heavy cover, without shouting,
    hand signaling, or relaying messages. The PRC-148 radio is a multi-band
    compatible squad system that has ultra-high frequency (UHF) and very
    high frequency (VHF) capabilities, enabling small unit users to link to
    the support and heavy weapons of the entire joint force. Each of these
    items are examples of the equipment we are aggressively pursuing to
    enable the rapid development and immediate distribution of information
    required to make decisions at the lowest level, where stability
    operations are won or lost.
        Real transformation depends upon a change in culture, however, not
    a change in equipment. The ongoing training for stability deployments
    and operational experience our marines are now developing will have a
    critical impact on our stability operations and peacekeeping
    capabilities for years to come. Our Project Metropolis (ProMet) Team
    has rigorously trained units for stability operations in Iraq,
    especially in urban environments. As part of our naval transformation
    vision of the increased joint and coalition unity of effort typical of
    peacekeeping, preparation for these deployments also includes an
    extensive training program involving the participation of our partner
    militaries. Our transformational technologies have recently been used
    in joint training exercises with British, Canadian, and Australian
    units as well. Each of these efforts is teaching a great number of our
    future leaders how to be ``No Better Friend, No Worse Enemy,'' lessons
    they are internalizing today for tomorrow's requirements of organizing,
    training, and equipping our future Corps.
        In short, we anticipate a continued need for the capabilities that
    are required for stability and peacekeeping operations, and are
    actively adapting our force with these requirements in mind. The Marine
    Corps does not look upon these as new competencies, however, and will
    employ them according to our maneuver warfare philosophy and
    expeditionary heritage. Our transformation will provide our future
    leaders with greater depth and additional options with which to place
    our adversaries on the ``horns of a dilemma'' during combat or
    peacekeeping. However, these options will increasingly include non-
    kinetic effects, Horn 10 and PSYOP to CMO and the training of local
    forces. We continue to believe that every operation requires an
    aggressive combined-arms approach, and the recognition that they remain
    an often-bloody contest of human will. The innovation, change and
    adaptation we depend upon will continue to create the capabilities
    required across the range of tomorrow's operations, and ensure the
    Corps continues it role as the Nation's total force in readiness.
        General Jumper. The Air Force's transformation plan identifies the
    capabilities we need to prevail in the future security environment.
    While broadly conceived, many of them, especially our joint force
    ``enabling'' capabilities, are directly relevant to future stability
    and peacekeeping operations. Our agile airlift fleet, for example, will
    be a key conduit of external aid and support, while giving joint and
    coalition forces needed mobility in areas of poor or nonexistent
    infrastructure. Our global Command, Control, Communications, Computers,
    Intelligence, Surveillance, and Reconnaissance (C\4\ISR) umbrella will
    lend clarity to an often chaotic operating environment by linking
    together distributed ``blue'' forces and furnishing them with precision
    navigation; establishing a coherent joint logistics picture; and
    providing persistent situational awareness against dispersed threats in
    urban areas and other complex terrain. Our ability to inflict a wide
    range of effects, including non-kinetic, non-lethal effects, will be a
    critical force multiplier for a Joint Force Commander (JFC) striving to
    establish order and security in the post-conflict phase.
        As DOD refines its vision for stability operations through the
    draft Stability Operations Joint Operating Concept, the Air Force will
    continue to identify Air Force capabilities crucial in enabling this
    aspect of transformation. All of our projected transformational
    capabilities are detailed in the USAF Transformation Flight Plan.

        74. Senator Dole. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, the welfare of the military family is undoubtedly a
    key to the success of our All-Volunteer Force. I would like to take
    this opportunity to thank the countless volunteers and military family
    advocacy employees for their dedicated work during OEF and OIF. How are
    your Services formalizing the family advocacy mission and how is this
    mission included in you transformation vision?
        General Schoomaker. Taking care of families is a dynamic and
    integral part of Army Transformation and the ``Installations as Our
    Flagships'' focus area. Army Community Service provides a full range of
    services to help soldiers and families adapt to the military lifestyle.
    The Army is adjusting family programs and resources to better support
    our soldiers and their families and to meet our goal to provide them
    the same qualify of life as is afforded the society they are pledged to
    defend.
        Admiral Clark. The Navy's Family Advocacy Program (FAP) is formally
    established through Secretary of the Navy and Chief of Naval Operations
    (CNO) instructions. It is a mandated program addressing the issue of
    child maltreatment and domestic abuse/domestic violence, including
    prevention, reporting, intervention, follow-up, and evaluation. Service
    to military families is formalized through longstanding fleet and
    family support programs provided on all Navy bases. Reservists who are
    deployed are informed of services available at each Navy base.
        For families living in remote areas, we have implemented a ``One
    Source'' program, which allows active and Reserve members of the Navy
    family to contact a professional counselor via toll-free telephone
    numbers for a wide range of assistance, including timely referral and
    assistance to the broad array of FAP resources.
        General Jumper. The Community Readiness Consultant (CRC) model will
    optimize resources and meet validated community level needs at each
    installation. CRC allows Family Support Centers (FSCs) to be proactive
    in individual/community support. Our current system encourages families
    to be passive recipients rather than active participants in their own
    lives and in the life of the community. The CRC model will allow FSC
    staff to provide services in the FSC and at the units. CRCs and
    Community Readiness Technicians provide more efficient and effective
    delivery of counseling/consulting services to Total Force members and
    families.
        Additionally, the program delivery fits community/family needs with
    more flexible tools to respond to changing and emerging needs of
    families/communities. The CRC utilizes the FSC automated Management
    Information System to assist with assessments, performance based
    measures and return on investment. The CRC model will provide a multi-
    skilled FSC staff to help build a strong, vibrant community through
    collaboration with other agencies, ensuring cost effective utilization
    of resources; thus meeting the community needs through outcome
    measures.
        General Hagee. The military lifestyle is challenging. The Marine
    Corps works very hard to provide ``combined arms support''--integrating
    the programs that address prevention and intervention needs for Marines
    and their families. In addition to the ``hometown'' support that
    families enjoy on our bases and stations, Marine Corps Community
    Services (MCCS) offers numerous programs that are specifically focused
    on prevention of domestic violence. Formally established in 1986, the
    FAP is a commander's program designed to prevent and treat domestic
    violence. The centerpiece of this program is a philosophy of
    Coordinated Community Response (CCR) that involves the command and
    brings to bear the host of supporting agencies and civilian community
    support resources to effectively address domestic violence.
        Prevention of family violence is our primary focus with initiatives
    such as the Mentors in Violence Prevention (MVP) program and the New
    Parent Support Program, as well as local training and education
    efforts. The MVP program was established to encourage the participation
    of male marines in efforts to prevent rape, battering, sexual
    harassment, and all forms of male violence against women. The MVP
    program is a ``marines helping their fellow marines'' program, which
    encourages marines to become involved when they see abusive situations.
    For the past 2 years the MVP program courses have been offered at the
    Senior NCOs' Academies, the 1st Sergeants' Courses, The Career Courses
    (NCOs) and the Advanced Courses (SNCOs).
        The New Parent Support Program helps ``replace'' the extended
    family available to new parents. It educates and supports families with
    children up to 6 years of age. It gives our new parents someone to call
    if they have questions, problems or concerns--questions that if in
    their hometowns they might have asked Mom, Grandma, or an older sister.
    This program consists of home visitation, classes and outreach through
    Play Morning, Single Parent Support Groups, Mom's Basic Training,
    Parenting Classes, and Daddy's Baby Boot Camp. The program successfully
    reduces the number of child abuse/neglect cases.

        75. Senator Dole. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, given that our current deployments are drawing
    heavily on Guard and Reserve Forces, what are you doing to ensure
    necessary and appropriate support for all families, especially those
    from rural communities who live long distances from military
    installations?
        General Schoomaker. The Army's goal is to provide accessible
    services and information for all family members. We are currently
    developing a multi-component family support network that will optimize
    information flow and program support to active, Guard, and Reserve
    families regardless of their proximity to Army installations.
        The Army's family and soldier readiness system includes assistance
    centers, readiness groups, rear detachments, and unit liaisons. Army
    Community Service (ACS) provides Reserve component family program
    personnel with information, training, and other assistance, and unit
    commanders use ACS and other resources to ensure soldiers and families
    are prepared and supported before, during, and after deployments.
        Army One Source (AOS) is one example of a program that meets the
    needs of geographically dispersed families. AOS is a 24-hour, 7-day-a-
    week toll-free information and referral telephone service available to
    soldiers, deployed civilians, and their families worldwide. AOS refers
    individuals to local civilian counselors for assistance as needed.
        Admiral Clark. We have recently implemented a program called,
    ``Navy One Source,'' which is particularly helpful for families of
    active and Reserve personnel in remote or isolated areas who require
    information/referral services. The program offers access to highly
    qualified staff of consultants through a toll-free telephone number and
    via the World Wide Web. A wide range of assistance is available,
    including, but not limited to, guidance on preparing for the arrival of
    a new born, preparing for deployment, counseling on relationship or
    financial difficulties, locating qualified child care resources and
    purchasing an automobile. The program's response is tailored to the
    callers' needs, is fully confidential, and is provided at no cost to
    users.
        General Jumper. We make every effort to ensure we stay in contact
    with and provide great support to our families, and especially those
    far removed from military installations. Our FSCs serve as the core of
    our outreach and care to these families before, during, and after
    deployments. They collaborate with appropriate State, and local
    resources to maximize support and services with our affected families.
    We have Family Readiness NCOs specifically trained to provide family
    assistance during times of crisis such as war, real world
    contingencies, and natural disasters. We facilitate as much family
    communication as possible to keep the family ties strong--especially
    during deployments. Our FSCs offer email connectivity, morale call
    programs, letter writing programs, video phones, and phone cards to
    encourage family communication. We also keep family members informed
    using unit spouse support groups, key spouse training, and town hall
    meetings. Families of the Air Force Reserve and Air National Guard also
    benefit from the services coordinated by Family Readiness Directors
    assigned to our Reserve units as well as Guard Family Assistance
    Centers throughout the U.S.
        We rely heavily on our technology-based systems to increase our
    capability to address the needs of our geographically separated
    families. Air Force Crossroads, (www.airforcecrossroads.com) our
    community Web site developed in 1999, posts updated information on
    family readiness and all of our family support resources from childcare
    and parenting, to job search and managing finances. Through Air Force
    Crossroads, we host a very active Spouses Forum Give chat room for
    spouses to meet, share concerns and support each other. Participants
    are able to quickly link to FSC staff if needed. Air Force One Source,
    (www.airforceonesource.com) launched earlier this year, is a geography-
    independent, 24-hour call center, and interactive Web-based service.
    Twenty-four hours a day, our total force and their families can use
    either a toll-free telephone number or the web to contact staff for
    counseling and referral on issues including deployment/reunion,
    parenting/child care, grief/loss, education, older adult care/
    information, legal, financial, and emotional well-being.
        General Hagee. Over the past year, the Marine Corps has gathered
    lessons learned on family support from OEF and OIF 1. We will continue
    to refine this support for all future deployments, but have established
    family outreach through multiple communication mechanisms (i.e., touch,
    virtual, voice, etc.) to address the different needs of our Marine
    Corps families.
        Our Key Volunteer Network (KVN) served as the official
    communication link between deployed commands and the families. The KVN
    is primarily a spouse-to-spouse connection that commanders use to pass
    important, factual, and timely information on the status and welfare of
    the operational unit. As spouse leaders, the key volunteers
    respectively interact with the commander regarding the welfare of the
    command's family members.
        The establishment of an OIF Family Information Hotline that has
    been re-activated for OIF 2 and a deployment support Web site assist
    with today's vast information and public contact requirement,
    regardless of the location of the caller or user. Both are specifically
    designed to sort the information needs of callers or users, and re-
    direct them to specific response or support capabilities. The Marine
    Corps is also very fortunate to have MCCS OneSource, a DOD employee
    assistance pilot program operated for the Marine Corps by Ceridian
    Corporation, as yet another touch point for family member support.
    Available Corps-wide in January 2003, over 26,000 uses occurred by
    telephone, email, or online in 2003, with increased uses in the months
    of March and April during the height of the conflict. This program can
    be especially useful for remote users such as the families of activated
    reservists. The program is available 24/7/365 via toll free telephone
    and Internet access.
        The most frequently asked about areas were in the categories of
    deployment status, parenting, childcare, everyday issues, and
    education. The families of activated reservists found helpful
    information on military programs such as TRICARE and other benefits and
    services. In addition to the expanded communications tools such as
    hotlines, Web site, and MCCS One Source, families of deployed Marines
    have access to the established family support programs on Marine Corps
    installations as well as through Unit Family Readiness Officers and
    Peacetime Wartime Support Team members located at each of our Reserve
    Training Centers.
        The scope and hours of operation of morale, welfare, and recreation
    (MWR) programs are adjusted as necessary during deployments. Families
    can receive pre-deployment briefs in person or online, as well as
    assistance in developing proactive, prevention-oriented plans such as
    family care plans, powers of attorney, family financial planning, and
    enrollment in the Dependent Eligibility and Enrollment Reporting System
    (DEERS) to minimize the stress of everyday decisions after the Marine
    has deployed. For post-deployment, the Marine Corps has also set up a
    Return and Reunion program to assist marines, sailors, and family
    members in transitioning to a more normal lifestyle. Additional
    services are provided to those who need respite childcare, assistance
    coping with separation, or specialized support in areas such as
    spiritual guidance, coping, and social skills.

    advanced threat infrared countermeasures/common missile warning system
                                 (atircm/cmws)
        76. Senator Dole. General Schoomaker, in light of the threats posed
    by Iraqi insurgents to our helicopters, could you elaborate on the
    Army's November 2003 decision to stick with its multiyear procurement
    of the ATIRCM/CMWS?
        General Schoomaker. In the months leading up to the November 2003,
    low-rate initial production (LRIP) decision for ATIRCM, the Army
    evaluated all cost, performance, and schedule implications of the
    program. This included an evaluation of all competing systems. The Army
    decided to stay with the multiyear procurement of the ATIRCM/CMWS
    because it was the only system that fully met all technical and
    scheduled requirements of the program, no other system could be fielded
    faster, and ATIRCM was 50 percent cheaper than any competitor.
    Concurrent with this decision, the Army decided to accelerate the
    installation of aircraft survivability equipment on all deployed
    aircraft. The modular design of the ATIRCM/CMWS equipment facilitated
    the execution of that decision by allowing near-term CMWS deployment to
    better counter existing threats while the ATIRCM jam head could
    continue through its scheduled development and testing program for
    deployment against future threats.

        77. Senator Dole. General Schoomaker, this system is not available
    for conventional units until 2010. By not accelerating this program,
    are we passing up an opportunity to provide our troops better
    protection in helicopters?
        General Schoomaker. Our conventional Army Aviation forces are
    scheduled to start receiving the CMWS with the Improved Countermeasure
    Munitions Dispenser (ICMD) in the fourth quarter fiscal year 2004. This
    will be accomplished under an accelerated fielding of aircraft
    survivability equipment approved by the acting Secretary of the Army on
    January 15, 2004. This system will provide an enhanced countermeasure
    capability against all known manportable air defense missile threats.
    To supplement CMWS/ICMD, the Army has also approved the accelerated
    fielding of a multi-band laser jammer, known as the ATIRCM, for fiscal
    year 2007. Together, these systems will provide our aircraft with a
    comprehensive flare/laser countermeasure capability for the future.

        78. Senator Dole. General Schoomaker, while we wait on the
    development and acquisition of future technologies, are there any
    interim systems available that could bridge this gap or are you finding
    that the threat (possibly small arms fire and rocket propelled grenades
    (RPGs)) requires a lower-tech solution?
        General Schoomaker. In early December 2003, the Army selected the
    ALE-47 Flare Dispenser Countermeasure System for installation on
    Chinook (CH-47) aircraft operating in theater. This effort is ongoing
    and will include all type aircraft scheduled to deploy for future
    operations. Concurrent with this activity, the Army has also upgraded a
    fleet of C-23 fixed-wing aircraft with a missile warning and flare
    dispenser system. In addition, the Army recently approved funds for
    procuring ballistic protection systems (BPS) for both the CH-47 and
    Black Hawk (UH-60) aircraft operating in theater. The BPS lines the
    cargo/passenger compartment of the aircraft types noted and will
    provide enhanced protection against small arms projectiles.

                                 strategic lift
        79. Senator Dole. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, each of your Services are transforming and
    investing heavily towards the next generation of capabilities. Yet less
    than 5 percent of the procurement and RDT&E budget, across the
    Services, is dedicated to strategic lift. Our national military
    strategy requires our forces to be capable of operating in multiple
    theaters at varying levels of conflict. Do you believe the defense
    budget request sufficiently resources and programs strategic lift to
    support our national security strategy and your Service's needs?
        General Schoomaker. Current directives, policy, guidance and vision
    beginning with the National Security Strategy (NSS) and National
    Military Strategy (NMS), require the military to be able to overcome or
    defeat enemy anti-access and area denial efforts. To meet the
    requirements of the combatant commanders, lethal ground combat
    formations must arrive intact and ready for immediate employment.
        The DOD should continue efforts to modify and improve current
    inter-theater (strategic lift) and intra-theater lift platforms, and
    field technologies that increase the number of usable theater entry
    points. The Army continues to facilitate joint interdependence in
    support of the combat commander's requirements by engaging the OSD and
    Service counterparts for support of Army strategic/intra-theater lift
    requirements.
        The Mobility Requirements Study for fiscal year 2005, finalized in
    January 2001, validated the sea and airlift requirements in a pre-
    September 11 environment. The new Mobility Capabilities Study, to be
    completed in June 2005, will validate lift requirements throughout DOD.
    With regard to strategic airlift, the Army supports the Air Force's
    position that at least 222 C-17s are required. Greater capabilities for
    strategic lift platforms and intra-theater lift platforms will enable
    us to deliver combat power faster into austere environments. Inter-
    theater and intra-theater lift capabilities are linked and must be
    complementary to meet the JFC's requirements. Super short take-off and
    landing, heavy-lift vertical take-off and landing, and high-speed
    shallow draft vessels, are developing technologies that support the
    Army's Future Force.
        Admiral Clark. In an unconstrained environment we could see needs
    that would suggest more spending on strategic lift. However, we are
    living with constraints and the budget presented presents a balanced
    approach that we believe properly resources strategic lift. We have
    asked for $117.0 million in the R&D account under the National Defense
    Sealift Fund (NDSF). This represents an increase of $103.6 million over
    the amount appropriated in fiscal year 2004. The bulk of this increase
    is to fund the concept development for the Maritime Prepositioning
    Force (Future) (MPF(F)) platform--which is envisioned to be the
    prepositioned centerpiece of our sea basing efforts in the coming
    years. In addition, we have requested $140.3 million to maintain our 8
    Fast Sealift Ships (FSSs) and 11 large medium-speed roll-on/roll-off
    (LMSR) ships in a 4-day readiness status. Finally, we have requested
    $221.5 million to maintain the 68 ships of the Maritime
    Administration's Ready Reserve Force (RRF) in near-term readiness
    status. We expect to continue our extensive analysis of this critical
    area in the fiscal year 2006 budget build.
        General Hagee. The Director, OSD Program Analysis and Evaluation
    (PA&E) and Director of Logistics (J4), Joint Staff are conducting the
    Mobility Capabilities Study (MCS) that will answer these questions with
    a substantial degree of accuracy. The overall study, which will be
    completed in March 2005, will examine the global mobility platforms and
    enablers needed to execute the defense strategy and support service
    transformation in the 2012 time frame. The study will identify mobility
    capability gaps, overlaps, or excesses and provide associated risk
    assessments; and recommend mitigation strategies where possible. The
    study will also identify and quantify alternatives in mobility
    capabilities to support the defense strategy from point of origin to
    point of use and return. Upon completion of the study, the Marine Corps
    will be able to accurately and with specificity, respond to the
    questions you raise.
        General Jumper. Our capability to project power anywhere in the
    world at any time is a key to meeting the current and anticipated
    challenges facing this Nation. These capabilities include the ability
    to airlift materiel and personnel across strategic distances and
    provide air refueling support to our own and coalition forces.
    Currently, the requirements to obtain these capabilities are defined in
    studies such as the Mobility Requirements Study-05. However, this study
    was based on earlier versions of the NSS and defense planning that did
    not anticipate the OPTEMPO of our post-September 11 world. To address
    the environment we find ourselves in today, the Air Force is engaged
    with the OSD and Joint Staff in a new and comprehensive MCS. We
    anticipate results will be available in the summer 2005 timeframe.
        The Air Force has allocated approximately 14 percent of procurement
    and RDT&E funding in the fiscal year 2005 budget proposal for strategic
    lift capabilities (C-17, C-5, and Materiel Handling Equipment). The MCS
    will refine our airlift and air refueling requirements and the Air
    Force will continue to balance priorities, risk and resources to
    sustain our critical mobility capability.

        80. Senator Dole. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, I applaud the support given by each Service in the
    effort to privatize housing for military families. Not only does this
    budget provide our military families with better living conditions but
    it does so at a lower cost to our taxpayers. In North Carolina this
    privatization plan calls for transferring, renovating, replacing, or
    building well over 8,000 family residences in just the next decade. Are
    the installation commanders being allowed to tailor these privatization
    projects for their respective communities?
        General Schoomaker. Installation commanders are encouraged to
    develop a project that meets local codes and installation design
    criteria. The Army has set minimum standards for a few basic criteria
    such as overall unit size but other aspects are within the installation
    purview and are negotiated at the installation.
        Admiral Clark. Yes. Installation commanders are instrumental in
    concept development and in the determination and articulation of the
    needs their communities.
        General Hagee. Marine Corps installation commanders are actively
    engaged in the development and execution of privatization projects for
    their communities. Installation commanders and their personnel
    participate in the development of the scope of work required and in
    determination of neighborhood phasing plans for larger privatization
    projects that will be executed in phases over a period of 2 or 3 years.
    Installation commanders approve the privatization concepts for their
    bases or stations prior to concept approval by Headquarters Marine
    Corps. Installation commanders or their designees, as well as command
    sergeants major, are also involved in the source selection and
    negotiation process.
        General Jumper. The installation commander and his staff play a
    critical role throughout the privatization of an installation's
    housing. Their role starts with collecting and validating the data, for
    the Housing Marketing and Requirements Analysis (HRMA), which
    determines the number of on-base housing units required to support the
    installation. The staff is also integral in the development of the
    Housing Comprehensive Plan (HCP), which identifies the construction and
    renovation requirements needed to bring the installation's housing to
    an adequate condition.
        Once the determination is made that a privatization initiative is
    feasible at a particular installation, the commander and staff serve as
    members of the Project Development Team (PDT) along with
    representatives from the Major Command and Air Force Center for
    Environmental Excellence. The PDT is charged with defining the scope
    and desired amenities to be included in the concept and request for
    proposal. Following concept approval, representatives from throughout
    the installation serve as members of the Acquisition Support Team
    reviewing proposals and serve as advisors. Finally, once an offer or is
    selected, installation personnel become the main focus as the terms of
    the transaction are finalized, the transition process is initiated, and
    development/long-term operations commence. This direct involvement of
    the installation commander and staff throughout the privatization
    process ensures the sustained success of the installation's housing
    privatization initiative.

        81. Senator Dole. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, how is the construction of new schools and other
    necessary support facilities being factored into privatization plans?
        General Schoomaker. The Army engages local school authorities early
    and continuously throughout the planning process to assess possible
    impacts of added or shifting student loads on school requirements. The
    Army provides development scope and schedule information to school
    officials to assist with planning for school requirements. The Army
    does not include school construction in the privatization development
    plan; however, the Army may offer land and infrastructure support for
    schools.
        Admiral Clark. Privatization projects are subject to the review
    requirements imposed by the National Environmental Policy Act (NEPA).
    The normal NEPA process includes coordination with local officials to
    assess any consequent impacts on schools and other necessary support
    facilities. The Department of the Navy factors into our privatization
    projects the normal development fees or impact fees customarily charged
    to all residential construction developers. Our projects include all
    costs normally associated with any other private development in the
    community. In situations where a new school is proposed to accommodate
    an increased student loan the Navy may make land available to the
    school district through the privatization process. In some
    circumstances the Navy may include funding for specific infrastructure
    improvements in the cost of the project. In New Orleans, for example,
    the Navy privatization project included a little more than $1 million
    for the construction of a sewage lift station to support the 545 new
    homes being constructed.
        General Hagee. Marine Corps privatization projects to date have not
    resulted in a requirement for construction of new schools because much
    of the privatization has been rehabilitation/reconstruction of existing
    stock, with limited deficit reduction. As a result, there has been
    little increased demand put on the local school systems. Each of the
    projects has, however, included construction of community support and
    recreation facilities. As Public-Private Venture (PPV) projects are
    developed, an assessment of environmental impacts, which include school
    impacts must be completed. As part of this process we engage local
    officials, including those representing schools to ensure their
    requirements are considered. Also, local school districts generally
    receive a higher level of school impact aid for children of military
    families living in privatized military housing located on government-
    land leased to the private partner than they would receive from
    traditional military housing.
        General Jumper. The Air Force looks upon its housing privatization
    projects as community developments, not just houses. The community as a
    whole is examined to determine the housing requirements as well as the
    requirement for ancillary facilities. These ancillary facilities can
    include schools, community centers, playgrounds, recreational areas,
    and other support-type facilities. Identified requirements are then
    worked into the project in order to provide a full, complete
    neighborhood community for the military member and their family.
        At the current time, none of our projects have determined the need
    for additional schools beyond what the local community can provide.
    However, they have determined the need for other ancillary facilities
    such as swimming pools, community centers, and playgrounds. These
    requirements have been included in the privatization process. The Air
    Force is conscious of our responsibility to the American taxpayer and
    ensures that the community requirements included in our projects are
    consistent with those found in similar housing developments privately
    owned in the local community.

                         joint warfighting capabilities
        82. Senator Dole. General Hagee, in preparation for OIF 2, you
    mentioned that the Marines are drawing on lessons learned from your
    sister Services, coalition partners, inter-departmental agencies, and
    the Marine Corps' own ``Small Wars'' experience. According to recent
    news articles, the Marine Corps is planning to take a ``fresh''
    approach as it prepares to take over in areas currently occupied by the
    United States Army (for example, emphasizing restraint and cultural
    sensitivity while living among the Iraqi population in platoon size
    elements). Does this mean that the Marines and the Army will
    deliberately employ different strategies in OIF 2? If so, isn't this
    contrary to your priority of enhancing joint warfighting capabilities?
        General Hagee. The Marine Corps continually evaluates new
    techniques and technology to address the unique requirement of this
    operational environment. This includes the re-evaluation and potential
    incorporation or modification of previously utilized strategies. This
    includes the Marine Corps' own historical lessons learned as well as
    other Services, as applicable to Marine Corps contribution to joint
    operations in OIF 2.
                                     ______

               Questions Submitted by Senator Joseph I. Lieberman
                            joint system development
        83. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, it is my understanding that the Joint
    Requirement Oversight Council's (JROC) primary functions are to assist
    the Chairman of the Joint Chiefs of Staff in providing you the best
    possible guidance on the degree to which budget proposals conform to
    the warfighting community's requirements and to ensure that joint
    warfighting capabilities and joint interoperability issues are
    highlighted in your budget guidance to Congress. In the National
    Defense Authorization Act for Fiscal Year 2001, Congress required the
    DOD to address perceived shortcomings in the joint weapons development
    process, specifically with the definition of joint (i.e. non-stove
    piped) requirements:

            --  First, to shift the JROC's primary focus towards more
            strategic issues;
            --  Second, to integrate joint experimentation activities fully
            into each new defense program's requirements, capabilities, and
            acquisition process; and
            --  Finally, to shift the focus of Joint Warfighting Capability
            Assessment (JWCA) teams to directly support the JROC in
            analyzing broader, future joint warfighting requirements.

        Since 2001, I have not heard nor have I seen notable progress in
    the efficiencies and successes of developing testing and fielding new
    and innovative weapons programs. What progress has the DOD made in the
    joint development arena?
        General Schoomaker. The issue of progress in gaining efficiencies
    and successes in developing, testing, and fielding of new and
    innovative weapons programs can be addressed in several ways. These
    issues are directly tied to the JROC's role in defining future joint
    requirements and program development. The JROC has already directed
    numerous changes to joint training and experimentation. It is extremely
    rare for any weapons program to reach fruition in a short 3-year time
    period. Programs which had the most visibility over the past few years
    had their roots and origins in developmental concepts and warfighting
    concepts that were in place long before 2001. Clearly, there is both
    good and bad to this situation. This more deliberate approach ensures
    that the right weapon for the right purpose, integrated in the right
    way, is put in the hands of the Joint Force. The Joint Force is an
    incredibly complex entity with countless moving parts. Accelerating the
    acquisition and fielding of systems for the Joint Force introduces some
    risk into the process. Sometimes those risks are worth taking as
    evidenced by the progress made in confronting the improvised explosive
    device threat in Iraq. This is a clear case of how the JROC can
    directly influence the rapid development and fielding of urgently
    needed capabilities.
        Most often, the Joint Force requires a more mature system and
    concept before it can safely and cost efficiently procure and field a
    new capability. To this end, the JROC has implemented significant
    procedural changes to the Services' acquisition processes that
    ultimately ensure a joint synergy which spans the spectrum of
    capability development.
        In 2001, the chairman's vision of the future was encapsulated in a
    document known as the Joint Vision. Between the strategic level of
    thought about warfighting contained in the Joint Vision and the actual
    development of service concepts and programs, there was very little
    guidance. The Secretary of Defense expressed his concern that, by the
    time major acquisition programs rose to the level where he could impact
    them, they were too far into development and the Services were so
    deeply invested he had no opportunity to make influential decisions.
    Most importantly, the Secretary was constrained to merely deciding
    whether to allow a program to proceed (and at what level) or to kill a
    program.
        Implementation of the new Joint Capabilities Integration and
    Development System (JCIDS) is rapidly rectifying this situation. At
    fruition, JCIDS will ensure the Services develop programs that are
    designed from inception to support overall requirements of the Joint
    Force and facilitate effective integration of these programs into the
    Joint Force. The management process that accompanies JCIDS, a group of
    Functional Capabilities Boards, which subsume the JWCAs, is directly
    focused on those issues that you highlighted from the 2001 National
    Defense Authorization Act. These boards ensure that, early in a
    program's life, it is determined to what extent that program fills a
    critical gap in our joint capabilities, or to what extent it provides a
    complimentary or redundant capability. This same Functional
    Capabilities Board process will determine the relative value of
    increasing our capability in a specific area, and whether the increase
    in capability is worth the investment.
        JCIDS will do all of this at fruition. Obviously, JCIDS represents
    a significant cultural change to previous methods of developing,
    prioritizing, and fielding new capabilities. Inculcating this new and
    more efficient process will take some time. The analytical tools that
    support decisions made under JCIDS are being implemented concurrently
    and require Service-wide dissemination. This is well under way.
    Programs presented to the JROC are now subjected to a level of scrutiny
    that is more detailed, more focused, and more prescriptive than at any
    time in the past. Programs that started as ``service centric''
    capabilities have been returned to the Services for revision or
    cancellation. Some of these revised programs will be reborn as a more
    efficient and cost effective joint capabilities.
        Combat developers and programmers are learning that the time to
    find out what the other services may want or need from an Army system
    is early in the program development cycle as opposed to when it is
    ready for production. The Services are learning to effectively leverage
    capabilities of other Services to avoid developing a service unique
    solution.
        The Army and its sister Services have worked very closely with the
    JROC and the Joint Staff to develop a set of concepts that provide a
    common framework which delineates how the Joint Force will fight in the
    future. This conceptual framework provides the critical link between
    individual Service efforts and the Joint Vision. Equally important, it
    integrates combatant commanders into the JROC process. The creation of
    Joint Operating Concepts provides an opportunity for the combatant
    commanders to directly influence the development of future warfighting
    concepts. The creation of Joint Functional Concepts has provided a much
    more detailed framework for understanding the common needs and purposes
    of Service capabilities, and for understanding those cases that require
    Service-unique needs and capabilities. The integration of these
    concepts into a jointly agreed upon, integrated framework provides the
    foundation for a truly Joint Force. These concepts will not answer
    every warfighting question or issue. They will provide a succinct focus
    to our experimentation community and provide them a clearly defined
    process by which to evaluate lessons learned.
        Admiral Clark. Progress in the joint development arena is
    exemplified, but not limited to the following programs; each is
    included in the President's budget request, and each has a record of
    meeting notable joint and cross service requirements. In each example,
    warfighting effectiveness and economic efficiencies were gained through
    the joint development process.
        JSF. The JSF is part of the family of tri-service, next-generation
    trike aircraft that will be the single fighter airframe for DOD.
        Joint Aerial Common Sensor (JACS). JACS is a research, development
    and acquisition program designed to replace our aging EP-3 airborne
    information warfare and tactical signals intelligence (SIGINT)
    aircraft.
        Joint Tactical Radio System (JTRS). JTRS is a software
    programmable, multi-band, multi-mode family of net-workable radios,
    capable of simultaneous voice, data, video communications and mobile ad
    hoc networking.
        Deployable Joint Command Control System (DJC2). DJC2 will provide a
    standing, fully deployable, scalable, and standardized command and
    control (C2) capability to the Regional Combatant Commanders (RCCs) and
    JFCs.
        General Hagee. Since 2000, there have been many changes in the
    processes that identify and validate joint capabilities. This will have
    a significant effect on joint development, testing and fielding of new
    and innovative weapons systems. In June 2003, the chairman implemented
    the JCIDS (CJCSI 3170.1C). The procedures established in the JCIDS
    support the chairman and the JROC in identifying, assessing and
    prioritizing capabilities needs as specified in title 10. JCIDS
    implements a capabilities-based approach that better leverages the
    expertise of all government agencies, industry, and academia to
    identify improvements to existing capabilities and to develop new
    warfighting capabilities. JCIDS is an enhanced methodology utilizing
    joint concepts that will identify and describe existing or future
    shortcomings and redundancies in warfighting capabilities, describe the
    attributes of effective solutions and identify the most effective
    approach or combination of approaches to resolve those shortcomings.
    The process inherently promotes efficiency while enhancing capabilities
    of the joint warfighter particularly important while faced with current
    fiscal challenges.
        One example of the JCIDS process at work to achieve efficiencies
    and successes in the development, testing, and fielding of new and
    innovative weapons programs is evident in the JROC's recent action to
    combine two similar, but different, programs, namely the Army's FCS and
    the Marine Corps' MAGTF Expeditionary Future Fighting Vehicle (MEFFV).
    To optimize research and development efforts, the JROC recommended
    forming a Joint Program Office (JPO). While the Army's FCS is an
    integrated family of vehicles, personal equipment, sensors and C2
    devices, the Marine Corps' MEFFV is being developed as a replacement
    for our aging feet of main battle tanks and light armored vehicles.
    Despite the similarities, each Service has different warfighting
    capability needs based upon specific methods of employment, performance
    parameters, missions, and organizational structure. JCIDS ensures that
    similarities are leveraged thus reducing the cost of redundant
    development efforts. We expect to achieve efficiencies in management,
    research, development and acquisition with the combining of these two
    future programs.
        General Jumper. The Air Force continues to look for ways to
    maximize joint development and testing, working with the Navy, Army,
    Marine Corps, and SOF community to identify opportunities.
    Interoperability is one of the most important factors as we move toward
    a capabilities based and network centric construct, which continues to
    be reviewed and directed by the JROC and the Air Force. We are also
    increasing the emphasis on joint programs and the use of one Service's
    program to satisfy the requirements of multiple Services. There are
    many examples, but some are of particular note. The Air Force-Navy JSF
    program will be developed with three variants for use by the Air Force,
    Navy, and Marine Corps, all of which maximize common parts, components,
    and maintenance. The Air Force's Family of Advanced Beyond Line of
    Sight Terminals (FAB-T) will develop and field satellite communications
    (SATCOM) terminals to replace the current U.S. Military Communications
    Satellite Program (MILSTAR) Command Post Terminals for all Services,
    the Joint Staff and OSD. At the same time, the Air Force is procuring
    Tactical UHF, Multi-Band, Multi-Mode Radios (MBMMRs) from the U.S.
    Special Operations Command (SOCOM) Program Office. The Air Force and
    Navy are also working very closely on developing joint weapons such as
    the JASSM and the JDAM. The Department is also pursuing programs such
    as the JTRS, which uses a common waveform repository to ensure
    interoperability while greatly reducing development costs. We have also
    changed the Air Force's focus on operational testing, working now to
    get the operational testers, from all affected Services, involved in
    the development effort as soon as possible. In this way, many potential
    issues are identified early in the program, allowing the opportunity to
    address them. As a result, our success in operational testing continues
    to improve, enabling us to get critical capabilities into the field as
    quickly, and safely, as possible.

        84. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, do you see an evolving and more substantive
    role for the JROC in future joint requirement definitions and program
    development? Please share with me the recent and future innovations the
    DOD has or is currently pursuing to promote more effective joint
    experimentation/training.
        General Schoomaker. The changes emanating from the National Defense
    Authorization Action of 2001 has led to concrete deliverables, in terms
    of weapon systems, by mid-2004. Most systems being delivered today do
    not reflect these changes. However, the systems of the future,
    especially those systems currently funded for research, development,
    and acquisition in the POM have been affected by the changes begun in
    2001. The maturation of the JCIDS process ensures the force you see in
    2010 will be vastly more jointly integrated, efficient, and capable
    than any force designed and programmed under the old way of doing
    business.
        Admiral Clark. Yes, there is an evolving and more substantive role
    for the JROC. The JCIDS, recently codified in Chairman's Instruction
    3170.01C on June 24, 2003, provides an enhanced role for JROC in future
    requirements definition and program development. All new Service
    programs are vetted through a joint review process that validates and
    approves new requirements and programs that bridge identified gaps in
    joint warfighting capabilities. This new process, which includes
    participation from all Services, the OSD, and other applicable
    agencies, assists the Chairman of the Joint Chiefs of Staff and the
    JROC in identifying, assessing, and prioritizing joint military
    requirements.
        Regarding innovations that promote more efficient joint
    experimentation and training, the JROC works closely with all combatant
    commanders, especially with United States Joint Forces Command (JFCOM),
    on joint experimentation and training. JFCOM serves as DOD's
    experimentation, joint training, interoperability and force provision
    ``transformation laboratory.'' One innovation promoting more efficient
    joint training is JFCOM's Joint National Training Capability (JNTC).
    Identified in the DOD's training transformation plan, this effort
    broadens and deepens the reach of joint force training through a
    networked collection of interoperable sites and nodes that synthesize
    personnel, doctrine and technology. This initiative will provide the
    participants with a global, network-centric capability that strengthens
    military transformation efforts, which promote joint warfighter
    effectiveness.
        General Jumper. In the summer of 2003, the JROC changed from a
    requirements-based system to a capabilities-based system. A
    capabilities-based process implements rigorous up-front analysis,
    ensuring more programs get visibility of the joint community. This new
    process drives jointness from the top-down, strengthening joint
    warfighting capabilities; links strategic direction to strategic
    investment decisionmaking; provides an engine for force transformation,
    and integrates material and non-material solutions to capability gaps
    and shortfalls. These are all challenges the new processes were created
    to meet. The long-term objective is for ``born joint'' capabilities
    development to drive system acquisitions. We are on our way to making
    this a reality.
        The Air Force has taken many steps to ensure more effective joint
    experimentation and training. We have stood up an Air Force Liaison
    office at JFCOM to help facilitate our efforts to assist them with
    concept development and the joint experimentation roadmap. A product of
    this relationship is our partnering with JFCOM to co-host the Air
    Force's primary wargame, Unified Engagement 04.
        General Hagee Yes. The JROC is taking an evolving and more
    substantive role in future joint requirement definitions and program
    development through the JCIDS. Under the JROC's direction the new JCIDS
    process replaced the old Requirements Generation System. JCIDS ensures
    greater visibility of capability proposals and established programs
    across each of the Services and agencies. The new process was
    established based on the need for a joint concepts-centric capabilities
    identification process that will allow joint forces to meet the full
    range of military challenges of the future. Meeting these challenges
    involves a transformation that requires the ability to project and
    sustain joint forces and to conduct flexible, distributed and highly
    networked operations. The process must produce capability proposals
    that consider the full range of doctrine, organization, training,
    materiel, leadership and education, personnel, and facilities (DOTMLPF)
    solutions to advance joint warfighting. Joint experimentation is used
    to validate the concepts that feed the JCIDS process. Joint
    experimentation explores concepts to identify joint and component
    DOTMLPF change recommendations and capabilities needs. Experimentation
    provides insight and understanding of concepts and capabilities that
    are possible given the maturity of specific technologies.
        JFCOM has been a major component of the joint concept development
    and experimentation program for the DOD since 1999. On October 1, 2002,
    the JFCOM was designated as the DOD's agent for transforming our
    Nation's joint warfighting forces. As such, their mission is to
    participate in the larger DOD effort to craft a military force in which
    combatant commanders, Service branches, and multinational partners work
    in concert to develop and produce new concepts and prototypes for
    waging war.
        An important catalyst for transforming military capability is the
    joint Concept Development and Experimentation (CDE) Campaign. This
    campaign aims to collaboratively develop concepts that, through
    vigorous debate, refinement, and experimentation, can be translated
    into warfighting capabilities that strengthen the effectiveness of
    combatant commanders in the field. Perhaps more important than
    fostering the creation of new concepts, the campaign serves as a
    mechanism to synchronize the efforts of combatant commanders, Services,
    and interagency partners as we collectively develop concepts and plan
    experiments in the course of transforming the military.
        JCIDS, under the JROC's direction, will continue to be a critical
    process to ensure the DOD is responsibly and efficiently meeting our
    national security requirements.
        The Marine Corps has historically conducted concept-based
    experimentation to help chart future combat development and deliver
    advanced capabilities to the operating forces. The Marine Corps premier
    wargame for 2004, ``Sea Viking,'' continues this tradition with a
    series of events designed to inform senior leaders on key issues
    affecting the Future Joint Force. JFCOM, in collaboration with the
    Services, has been tasked with developing the joint forcible entry
    capability enhancements required to overcome a potential range of anti-
    access/area denial strategies. The Sea Viking campaign will assess
    future Sea Based Marine Expeditionary capability sets, ESG/Force
    capability sets, and Sea Based Command and Control capability sets
    required for joint forcible entry operations. This will help inform the
    ongoing Joint Staff, Joint Forcible Entry Capabilities Based
    Assessment.

                         office of force transformation
        85. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, the Director of the DOD's Office of Force
    Transformation (OFT), Vice Admiral Arthur Cebrowski, has said recently
    that military transformation, ``lies at the heart of our new approach
    to defense'' and that it ``is not [just] a goal for tomorrow, it is a
    fundamentally important endeavor that we must embrace in earnest
    today.'' I agree. However it remains to be seen exactly how the OFT is
    furthering military transformation and how exactly it works
    collaboratively with the JROC and JFCOM to promote a unified path for
    the development, test, and implementation of joint force doctrine.
    Please explain to me the current projects, near- and long-term
    objectives, and the process used by OFT to coordinate with the Service
    branches and combatant commands.
        General Schoomaker. Vice Admiral (Retired) Cebrowski's office has
    been an advocate and a catalyst for advancing Defense transformation.
    OFT promotes synergy between the Services and JFCOM ensuring that
    transformation strategy is open to challenge by a wide range of
    innovative ideas. OFT regularly meets and coordinates with the Services
    and JFCOM to facilitate transformation roadmap development. Using these
    roadmaps, and other sources, OFT provides recommendations and revisions
    to the Strategic Planning Guidance ensuring U.S. forces continue to
    operate from a position of overwhelming military advantage. OFT also
    conducts an annual Strategic Transformation Appraisal of Defense
    Transformation. In this appraisal, OFT identifies key barriers to
    military competition that are systemic across the DOD and identifies
    joint capabilities gaps. OFT's Transformation Trends highlights new and
    emerging issues for key decisionmakers within the Department, the
    military services, commercial industry, and the technology world.
        Admiral Clark. The Navy interacts directly with OFT to produce the
    Naval Transformation Roadmap. This is an annual DOD requirement and
    includes our current projects and near- and long-term objectives. OFT
    analyzes the service and joint roadmaps and provides feedback to the
    services individually and to DOD leadership collectively. Additionally,
    OFT leads a congressionally-mandated study of Naval Architecture this
    year. Navy officials have provided briefings and data to the OFT in
    support of this effort.
        General Jumper. OFT is a key player in most aspects of OSD's
    transformation strategy articulated in Secretary Rumsfeld's
    Transformation Planning Guidance. It regularly meets and coordinates
    with the Services and JFCOM to help guide transformation roadmap
    development. OFT uses these roadmaps, which include the Air Force
    Transformation Flight Plan, as well as DOD science and technology
    efforts and other sources, to conduct the annual ``Strategic
    Appraisal'' of DOD transformation. In this appraisal, OFT identifies
    major issues or shortfalls that may exist across the DOD impeding
    transformation progress. These shortfalls provide inputs to OSD's
    Strategic Planning Guidance, which, in turn, informs future Service POM
    development. Finally, OFT initiates rapid RDT&E programs through the
    Transformation Initiative Program and the Joint Rapid Acquisition
    Program.
        With regard to the Air Force specifically, OFT is collaborating
    with us on several programs. OFT and the Air Force Research Laboratory
    (AFRL) are working together to develop the new Rapid Response Launch
    Vehicles for tactical satellites (launch is scheduled for May). We are
    also working with OFT on developing airborne relay mirrors; adding
    transformation to our academy and professional military education
    curriculums; and in inserting transformational concepts into our
    Service wargames.
        General Hagee. The OFT has a direct role in influencing how our
    transformational objectives will be pursued. Under the guidance from
    certian documents like the Transformation Planning Guidance, as well
    as, joint documents such as the Joint Operations Concepts, and the
    Joint Operating Concepts, the Marine Corps, in conjunction with the
    Navy, develops an annual Naval Transformation Roadmap. Shortly
    thereafter, OFT conducts a strategic appraisal of the DOD, that
    provides valuable feedback on the capabilities and strengths of each
    Service's transformational plans in the current-, near-, and far-term.
    By performing these efforts, OFT ensures that the individual service
    efforts match the joint environment and the goals set forth by the
    Secretary of Defense.
        The ultimate objective is a rational, sustained effort to create
    and maintain a concept-based force development system. By setting
    transformational goals early in the planning process, prioritized
    decisions can be made to ensure that the right initiatives are pursued
    in support of our vision of the future joint force.
        Additionally, certain joint transformational concepts are
    championed by OFT and influence our naval concepts, as well as, our
    capabilities development. For instance, the Sense and Respond Logistics
    concept is an OFT-sponsored initiative to improve our naval concept of
    sea basing and at the same time provides joint capability enhancements
    for the JFC. Sense and Respond Logistics is envisioned as an approach
    that yields adaptive, responsive demand and support networks that
    operate in alternate structures that recognize operational context and
    coordination.

                  support to national guard and reserve forces
        86. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, I realize that a great deal of effort has
    been put on the fielding of IBA and up-armored HMMWVs to all of our
    military and civilian personnel engaged in combat operations world-
    wide. The DOD has made progress working with industry officials and
    greatly increasing production of these critical force protection
    supplies. This good work, however, does not excuse the fact that our
    military was woefully unprepared and ill-equipped to engage in a low
    intensity type conflict, as we are currently experiencing in Iraq.
    Furthermore, I have received countless correspondences from concerned
    Connecticut residents, whose loved-ones are valiantly serving in
    deployed Guard and Reserve units supporting OIF. However, these men and
    woman have not been adequately provided critical assets needed to
    perform their duties: ammunition, personal protection devices, armored
    vehicles, etc. With the military promoting a Total Force concept, where
    Guard and Reserve units play an active and important role in conducting
    operations as Active-Duty Forces, it is inexcusable that these brave
    men and women are not adequately supported by there leadership. What
    are you doing to ensure that this situation does not occur in future
    combat or peacekeeping deployments?
        General Schoomaker. We can do two things. First, we can plan for
    potential requirements beyond those in approved program levels and
    second, we can add options into critical contracts to allow for
    accelerated production. This will encourage more proactive thinking
    about contingency requirements and potential obstacles to rapid
    production and may reduce risk. However, this will not eliminate all
    risk. The noncontiguous urban threat of OIF necessitated that every
    soldier and DOD civilian in theater receive body armor. This was a
    divergence from the original guidance to issue only combat soldiers
    body armor. Once we recognized an increased risk, the requirement
    changed and the procurement system then used all possible means to
    respond. We will work to improve our procurement system, but we cannot
    eliminate all risk from changing threats.
        Admiral Clark. We undertook a comprehensive effort to ensure all of
    our personnel participating in OIF were properly equipped for the types
    of operations they were asked to perform. Based on lessons learned from
    last year, we have restructured unit allowance lists for many of these
    units, such as Naval Construction Force (``Seabees'') and Expeditionary
    Logistics Support Force (cargo handling) units, to upgrade their
    personnel protection capabilities to meet new mission requirements.
    Navy resource sponsors have realigned current year funds to provide the
    identified new, or additional, gear to those units. The Navy makes no
    distinction in equipping its Active and Reserve Forces for deployment
    to OIF. Like units with like missions, are equipped the same to safely
    perform their operational duties. Additionally, we have made every
    effort to ensure that all Navy individuals enroute to the CENTCOM
    theater receive everything needed to maximize their safety while on the
    ground by sending them through one of the two Army continental United
    States (CONUS) Replacement Centers (Reserve components). As our
    missions evolve in the future, we will continue to evaluate planned
    operating environments and to resource Active and Reserve Forces to
    safely and effectively perform their designated missions.
        General Hagee. The Marine Corps is completely committed to ensuring
    that our Reserve Forces are equipped equally with their active duty
    counterparts. In particular, our procurement strategies for ammunition,
    personal protection devices and armored vehicles have been designed to
    provide Marine Forces Reserve, with the same equipment as I, II, and
    III Marine Expeditionary Forces (MEFs), the active duty commands to
    which our Reserve units join upon mobilization. Allow us to be more
    precise.
        1. Ammunition: Again sir, there is no distinction between active
    duty and Reserve marines for ground ammunition. Each marine receives
    sufficient ammunition assets to conduct all pre-deployment training
    including: weapons handling, individual live firing with known
    distance, unit cohesion engagement skills and any other type training
    deemed appropriate by any and all commander's from the unit level to
    the combatant commander. Live ammunition is initially issued in bulk
    and is referred to as a Combat Load. A Combat Load is the quantity of
    ammunition that can be carried on the individual marine's body or
    transported with organic vehicles. For example: the M16A2 Rifle Combat
    Load is 350 rounds of ball ammunition, ten rounds of tracer ammunition.
    Additionally, commanders at any level have the authority to increase
    Combat Loads, based on their personal threat assessment, without
    recourse. Ammunition re-supply or sustainment is provided daily in
    sufficient quantities to regenerate each marines original Combat Load.
    The Marine Corps has sufficient quantities of ammunition in the CENTCOM
    AOR to sustain all deployed Marine forces for extended periods at
    intense (assault) engagements levels. Globally, the Marine Corps has no
    shortages of ground ammunition to support deployed forces. To date,
    since the inception of the global war on terrorism (OEF, OIF 1, OIF 2),
    there has been no ammunition shortages for Marine Corps Forces deployed
    during combat operations. We are confident that our ammunition
    processes and funding profile will continue to ensure that sufficient
    ammunition is available for future combat or peacekeeping operations
    for both our Reserve and Active Forces.
        2. Personal Protection Devices: As in the case of ammunition there
    is no distinction between active duty and Reserve marines in terms of
    equipment for personal protection. Essentially, when we refer to
    personal protection in regard to the global war on terrorism (OEF, OIF
    1, OIF 2) we are referring to the procurement and issue of SAPI plates
    and the OTV in which the SAPI plates are worn. At the outset of OIF the
    USMC was already producing SAPI plates and OTVs to equip all our
    forces. However, the surge demand for combat in OIF 1 required us to
    not only shift our fielding plans to focus all items coming off the
    production lines to I MEF's Reserve and active duty units but to also
    direct some redistribution of SAPI plates and OTVs from the other MEFs
    in support of I MEF. To date, the Marine Corps has completed the SAPI
    plate fielding push required to meet the OIF 2-1 requirement, resulting
    in all active and Reserve marines deployed in theater having two SAPI
    plates and one OTV. We are now returning to the established fielding
    rate of 4,800 plates per month over the next year. In addition, we are
    preparing to let a contract, in support of OIF 2-2, for an additional
    14,000 plates with delivery this summer. We anticipate an estimated
    delivery of 18 months to meet our acquisition objective of 267,154
    plates. In the interim, the Marine Corps will redistribute plates as
    necessary to both Reserve and active duty units in order to meet any
    emergent contingencies requiring future combat or peacekeeping
    deployments.
        3. Armored Vehicles: As with all our efforts to equip our forces
    there have been no distinctions with our active duty and Reserve
    marines in regard to armored vehicle procurements. As we saw in OIF 1,
    the balance of armored vehicles to unarmored vehicles within our Marine
    formations (i.e., Tanks, Assault Amphibious Vehicles (AAVs), Light
    Armored Vehicles (LAVs), armored HMMWVs versus un-armored HMMWVs and
    trucks) served us very well in the swift defeat of Iraqi conventional
    formations. As we are just now beginning the re-introduction of Marine
    Forces back into Iraq in support of OIF 2-1, the USMC has accomplished
    a surge effort to augment vehicle hardening armor within our tactical
    wheeled vehicle fleet (i.e., HMMWVs and trucks) ensuring that every
    Marine HMMWV and truck with I MEF's Reserve and active duty units in
    Iraq will have armor kits available by March 19. Concurrently, we are
    reassessing our long-term tactical wheeled vehicle armoring strategy
    and have directed the Marine Corps Combat Development Command to
    recommend an appropriate mix of armored to unarmored tactical wheeled
    vehicles for foreseeable future contingencies. In the interim, we are
    confident that if necessary to support imminently emergent future
    combat or peacekeeping operations we will be able to conduct another
    surge effort to provide ``just-in-time'' armor kits.
        In closing, I want to assure you, yet again, that inside the Marine
    Corps there is no differentiation between our Active-Duty Forces and
    our Reserve Forces when it comes to equipment for combat, especially in
    regard to efforts to prepare for future combat. Our transformation
    efforts whether through our Marine Corps Warfighting Lab, through
    Advanced Concept Technology Demonstrations (ACTD) or through other
    venues consistently rely on Reserve participation and input. Each
    marine's welfare and success in battle is foremost in our efforts and
    every marine will receive our unstinting efforts in their behalf now
    and in the future.
        General Jumper. The Air Force remains committed to ensuring all our
    airmen (Active Duty, Guard and Reserve) are equipped to meet current
    and future requirements across the realm of military operations. We
    strive to ensure Air Force solutions to capability and equipment
    shortfalls are ``total force'' solutions that provide continuous
    seamless integration of the Air Reserve component when called to
    action. The challenges our airmen are facing in OIF both demand and
    deserve our utmost attention and we are committed to solving those
    issues. The Air Force is working aggressively to equip all of our
    warfighting airmen to ensure mission accomplishment at the least
    possible risk. For example, we have provided 8,000 sets of IBA to our
    deployed personnel and we are focused on completing a $100 million
    central purchase of IBA. We are also working closely with the Army and
    the Joint Staff to reallocate limited resources, such as up-armored
    vehicles, to ensure those critical assets are available for the
    combatant commanders' highest priority missions.

                            post-conflict operations
        87. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, in response to the many lessons learned from
    the military's difficulties in post-war Iraq, I understand that the
    Pentagon has begun an investigation into the creation of a military
    force specializing in peacekeeping and reconstruction activities
    following future conflicts. What can you tell me about your overall
    vision for this capability?
        General Schoomaker. Rather than have a portion of our forces
    specialized in a niche array of tasks, the Army's modular brigade units
    of action will be organized to perform in a variety of roles and
    missions. In order to maintain our flexibility and a depth of
    capabilities for long-term rotational operations, our forces will be
    multi-functional rather than narrowly focused. Our objective is to
    create a force that can sustain a rotational campaign-level of effort,
    in which forces can rapidly transition from traditional combat
    operations, such as raids and deliberate attacks to stability and other
    support and stability tasks, such as presence patrols and
    reconstruction efforts. Our recent experiences tell us we must be able
    to transition literally overnight--to the point of executing combat
    operations in one sector, while simultaneously performing stability
    operations in an adjacent sector. In fact, our successes in stability
    and support operations have been greatly enabled by our ability to
    rapidly shift from traditional peacekeeping tasks in order to conduct
    decisive offensive action.
        Admiral Clark. My vision for the future of these operations ashore
    is fundamentally and necessarily about how we will conduct operations
    at, and from the sea. By providing a joint, networked and secure sea
    base from which to apply persistent sensors, command and control,
    strike and logistics, we can ensure that we have not just a smaller
    logistic and support footprint ashore, but the right footprint ashore.
    Additionally, by moving a large proportion of supporting fires and
    tactical aircraft to sea, we could reduce our force protection
    requirements as well. Thus, we can focus more of our marines and
    soldiers on the ground toward accomplishing, rather than supporting the
    mission.
        This is part of what I like to call the strategic speed and
    operational agility that we, along with our number one joint partner,
    the United States Marine Corps, are in the process of improving.
    Together, we are working toward a naval force that can rapidly seize
    the initiative on the kinds of non-contiguous and chaotic battlefields
    that are so prevalent in Iraq. We will achieve that kind of speed and
    agility by getting lighter, by investing in C\4\ISR and precision
    fires, and by fundamentally altering our concepts of operation.
        General Hagee. Marine Forces are trained and equipped for success
    in the full spectrum of combat operations. We view peacekeeping and
    reconstruction activities as routine operational requirements which are
    encompassed within our scope of operations. Our troops are adept at
    transitioning from combat operations to peacekeeping and reconstruction
    operations. We view peacekeeping and reconstruction operations as the
    foundation for the successful re-establishment of stabilization in a
    post combat environment and are prepared to remain until civil
    authorities become capable of providing the basic needs of their
    society. We remain committed to maintaining our dedication to
    warfighting excellence in these operational areas.
        General Jumper. The Air Force currently operates at all levels of
    the spectrum of operations providing a diverse range of capabilities
    from close air support to humanitarian assistance to ISR. The Air Force
    studied lessons learned from Afghanistan and was able to incorporate
    those lessons directly into Iraqi operations. Logistics planning
    allowed a comprehensive base draw down, while at the same time
    effectively supporting humanitarian airlift operations. The use of
    radio frequency tags enhanced in-transit visibility and automated
    decision tools allowed airlift planners to maximize limited staging
    space. Additionally ISR operations, especially UAVs provided valuable
    support in reconnaissance and surveillance of potential hotspots. All
    the while, space systems provided precise location for GPS equipped
    units and equipment, and over the horizon communications. The Air Force
    has placed airmen in Combined Joint Task Force-7 (CJTF-7) and CENTCOM
    to ensure that the full range of air and space power meets the
    combatant commander needs. Because of the flexibility of the Air
    Force's projected force structure, the Air Force will continue to make
    substantial contributions to efforts to attain stability and restore
    conditions that can promote democracy and liberty.

        88. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, what level of interaction do you foresee
    this capability having with international forces, either through the
    United Nations (U.N.) or North Atlantic Treaty Organization (NATO)?
        General Schoomaker. We are designing our forces and command modules
    to be capable of joint and coalition operations. If the global war on
    terrorism continues at its current pace, we foresee significant
    interaction with coalition forces in order to achieve our common goals
    and objectives.
        Admiral Clark. I anticipate that we are going to have to continue
    to be able to work well with international forces if we are going to be
    successful in these types of operations. Ongoing NATO missions in
    Afghanistan, the Mediterranean Sea, and the Balkans demonstrate the
    high degree of interaction and interoperability required for
    international post-conflict operations. We expect that the
    interoperability between NATO forces, gained over many years of
    cooperative training and operations, will continue as a key element to
    our success in this regard. We have also gained important experience
    working with non-NATO forces in the post-conflict environment. In fact,
    since May 2003, there have been 85 maritime assets from 15 nations (see
    Table 1) employed by the Commander, U.S. Naval Forces, CENTCOM in
    support of OEF and OIF.
        One of the outcomes of all of this practical experience has been
    the emergence of a need to enhance our ability to exchange secure data
    with our friends and allies. Given the level of interaction with them
    that we expect in future operations, we have pursued a technology
    called the Combined Enterprise Regional Information Exchange System
    (CENTRIXS). This is a standing global network allowing U.S. and
    coalition nations to share secure operational and intelligence
    information in support of combined planning and decision making in
    multinational operations. CENTRIXS, already being used by several
    partner nations, is scheduled for full certification in the fall of
    2004.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        General Hagee. The Marine Corps continually evaluates new
    techniques and technology to address the unique requirement of this
    operational environment. This includes the re-evaluation and potential
    incorporation or modification of previously utilized strategies. This
    includes the Marine Corps' own historical lessons learned as well as
    other Services, as applicable to Marine Corps contribution to joint
    operations in OIF 2.
        General Jumper. The U.S. Armed Forces historically rely on
    international forces, whether in coalition or alliances, to provide
    forces and capabilities to accomplish each military operation's
    strategic objectives and end-state. Throughout the operations of the
    last decade we have learned the positive impact regular training
    interaction brings to multinational operations culminating in unity of
    effort. I will continue to ensure any capabilities developed for the
    Air Force will account for the fact we are likely to deploy and employ
    in a multinational environment. As much as possible we will stress
    compatibility, interoperability, interchangeability, and commonality
    with not only NATO and the U.N., but other regional forces as well.

        89. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, what progress has the DOD made in developing
    a concept for transforming and implementing our military's post-
    conflict force structure?
        General Schoomaker. The OSD has introduced several initiatives to
    shape transformation. OSD Transformation Planning Guidance and
    Strategic Planning Guidance (SPG) will help the Services properly
    structure their forces for the emerging strategic environment. We are
    implementing initiatives to transform our force, e.g., modularity,
    force stabilization, military to civilian conversions, and active
    component/Reserve component rebalancing which complement OSD's efforts.
    These Army initiatives will improve our broad-spectrum capabilities for
    both combat and post-conflict operations by increasing high demand
    capabilities such as infantry, military police, SOF, and various
    support units. They will improve our force readiness, decrease
    turbulence, and enhance our ability to respond quickly. Overall, the
    initiatives will yield a force that is more ready and relevant to the
    Nation's needs in war and peace.
        Admiral Clark. In light of our lessons learned from OEF and OIF, we
    are working with JFCOM, in concert with the Joint Staff, the other
    Services and the combatant commanders, to develop a set of concepts for
    conducting stability operations. When completed, these concepts will be
    integrated into the joint process to identify capability and
    supportability shortfalls, compare alternatives for improving joint
    capabilities, and lead to appropriate resource decisions.
        The Navy-Marine Corps team is working now to develop the concepts
    and design the structure that will help provide a joint, networked and
    secure sea base from which to apply persistent sensors, C\2\, strike
    and logistics. This would allow us to have not just a smaller logistic
    and support footprint ashore, but the right footprint ashore.
    Additionally, by moving a large proportion of supporting fires and
    tactical aircraft to sea, we could reduce our force protection
    requirements ashore as well. Thus, we can focus more of our marines and
    soldiers on the ground toward accomplishing, rather than supporting the
    mission.
        This is part of what I like to call the strategic speed and
    operational agility that we, along with our number one joint partner,
    the Marine Corps, are in the process of improving. Together, we are
    working toward a naval force that can rapidly seize the initiative on
    the kinds of noncontiguous and chaotic battlefields that are so
    prevalent in Iraq. We will achieve that kind of speed and agility by
    getting lighter, by investing in C\4\ISR and precision fires, and by
    fundamentally altering our concepts of operation.
        General Hagee. With regard to transformation plans and implementing
    our military's post-conflict force structure, the following is
    submitted. This is an excerpt from the February 12, 2004, Deputy
    Commandant, Plans, Policies, and Operations draft statement to the
    Subcommittee on Military Readiness of the House Armed Services
    Committee that was delivered on March 11, 2004.
        Opportunities for modernization are rare, and opportunities for
    true transformation come but once in a generation, if at all. That is
    why we feel compelled to emphasize here the importance of our
    acquisition priorities and program initiatives such as the MV-22
    Osprey, our number one aviation priority, the KC-130J, representing a
    significant increase in operational efficiency and enhanced refueling
    and assault support capabilities, the EFV which will reduce the
    vulnerability of our naval forces and greatly enhance operational and
    tactical mobility for our surface assault elements, the STOVL JSF which
    represents a great improvement in reliability and combat capability
    over existing legacy platforms, the Lightweight 155mm Howitzer, a more
    capable, deployable, survivable, and accurate weapon than current
    indirect fire systems, and the CH-53X and UH-1Y/AH-1Z aircraft which
    promise greater safety, survivability, and supportability over the
    current fleet of aging airframes.
        Concepts like Tactical Air integration, Logistics Modernization and
    Command and Control, and improvements in intelligence and information
    operations are equally essential to true transformation, and we are
    focusing our efforts on the technology and processes that facilitate
    transformation.
        Most important of all to our future readiness are our sea basing
    initiatives in partnership with the Navy. We hold a deep and abiding
    conviction that sea basing initiatives hold the greatest promise for
    transforming the Marine Corps-Navy team into a more flexible,
    responsive crisis response force, able of projecting power across the
    full spectrum of operational capabilities anywhere in the world.
        This year, the Marine Corps has continued to refine plans for the
    Marine Expeditionary Brigade of 2015, in concert with our concept for
    sea-based operations. Similarly, the analysis of alternatives for our
    Maritime Pre-positioning Force (Future), a critical component of sea
    basing, will provide valid choices for achieving sea basing
    capabilities. These initiatives will complement, rather than replace,
    the amphibious lift and forcible entry capacity of the LHA(R), LPD-17,
    and LHD, and will provide the Nation a deployment and employment
    capability unmatched in the modern world.
        In addition to the above items, the Commandant of the Marine Corps
    has recently directed experimentation with a concept for distributed
    operations, whereby Marine Forces will be able to operate in a more
    decentralized manner with smaller tactical units to better extend
    operation reach and control in an extended battlespace.
        General Jumper. The Air Force is not planning to create a separate
    military force to deal with post-conflict operations. The USAF
    currently operates at all levels of the spectrum of operations
    providing a diverse range of capabilities from close air support to
    humanitarian assistance to ISR. The USAF took lessons learned from
    Afghanistan and was able to incorporate those lessons directly into
    Iraqi operations. Logistics planning allowed a comprehensive base draw
    down while at the same time effectively supporting humanitarian airlift
    operations. The use of radio frequency tags enhanced in-transit
    visibility and automated decision tools allowed airlift planners to
    maximize limited staging space. Additionally ISR operations, especially
    UAVs, provided valuable support in reconnaissance and surveillance of
    potential hotspots. All the while, space systems provided precise
    location for GPS equipped units and equipment, and over the horizon
    communications. The USAF has placed airmen in CJTF-7 and CENTCOM to
    insure that the full range of air and space power meets the combatant
    commander needs. The built-in flexibility of the projected force
    structure will allow the Air Force to substantially contribute to
    efforts to attain stability and restore conditions that can promote
    democracy and liberty.

                      research and development off-shoring
        90. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, many experts in the defense and intelligence
    communities are seriously concerned about the loss to the U.S. economy
    of the high-end semiconductor chip-manufacturing sector to East Asian
    countries, the likely subsequent loss of the semiconductor research and
    design sectors, and the grave national security implications that this
    would entail. The composition of the global semiconductor industry has
    changed dramatically in recent years. National trade and industrial
    policies of East Asian countries which have capitalized on these
    changes are driving a migration of semiconductor manufacturing to that
    region, in particular to China, through a large array of direct and
    indirect subsidies to their domestic semiconductor industry. This
    migration is occurring at a time when these components are becoming a
    crucial defense technology advantage to the U.S., due to the present
    and future needs of advanced processors in the defense and intelligence
    communities. Informed elements of the military and intelligence sectors
    have made clear that relying on semiconductor integrated circuits
    fabricated outside the U.S. (e.g. in China, Taiwan, and Singapore) is
    not an acceptable national security option. Is the DOD engaged in
    analyzing this issue and are you planning to outline the potential
    long-term solutions of this problem with respect to the DOD?
        General Schoomaker. This is an effort led by the OSD, in which the
    Army participates. On October 10, 2003, the Acting Deputy Secretary of
    Defense for Acquisition, Technology, and Logistics (AT&L) established a
    strategy to ensure access to trusted suppliers of leading edge,
    critical integrated circuits in sensitive defense weapons. That
    strategy consists of identifying dependable producers and exploring
    needed refinements to the strategy.
        Admiral Clark. The DOD is engaged in this issue. On October 10,
    2003, the Deputy Secretary of Defense established a formal approach to
    ensure access to trusted suppliers of leading edge, critical integrated
    circuits for use in defense systems. The Department is actively
    exploring alternatives and has established a Defense Science Board Task
    Force to examine the subject, which began its study in March 2004.
        General Hagee. The Marine Corps depends on the semi-conductor chip
    industry for processing and delivering critical information and
    appreciates the national security implications of the industry's
    domestic decline and the potential security implications of relying on
    development and manufacture of semiconductor chips in foreign
    countries. The Marine Corps, however, has not yet linked this concern
    to the loss or threat of capability nor developed a service-specific
    solution to this situation and, as the matter effects the whole of the
    DOD, we respectfully defer to the leadership of the Joint Staff and/or
    the expertise of the National Security Agency (NSA) to address any
    long-term solutions the DOD has undertaken.
        General Jumper. The Air Force analyzes source of supply issues on a
    case-by-case basis and has not addressed the semiconductor industry as
    a whole or focused on the movement of production capability offshore.
    However, this is an area being studied by the DOD and the current
    approach calls for establishing a ``trusted foundry'' to ensure
    critical defense systems have a trusted source of semiconductor
    components--a source that can manufacture sensitive defense designs in
    confidence, ensuring these components have not been modified or their
    integrity compromised, and can guarantee these components and the
    underlying technology are available when needed by the DOD.
        Where there is concern is in the move offshore of the materials and
    components used in building these integrated semiconductor components-a
    large portion of the companies manufacture items such as ceramic
    packages, high-purity silicon wafers, die materials, quartz products,
    resins, and optical equipment are foreign-based or foreign-owned. These
    items are not unique to military parts and the commercial market drives
    their economics and technology. However, with an annual world market
    for semiconductors and semiconductor equipment of almost $300 billion,
    the industrial base for these components should remain strong. As for
    the integration of these components, current military requirements are
    met predominately by the large vertically integrated United States
    defense manufacturers--companies such as Lockheed Martin, Northrop-
    Grumman, Raytheon, and Honeywell who have design and fabrication
    capabilities to ensure military unique performance and security
    requirements are met.

        91. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, I understand that a foundry to ensure DOD
    access to a short- and mid-term supply of cutting edge integrated
    circuits may address immediate national security concerns. What kinds
    of long-term strategies are being considered to ensure DOD first and
    assured access to critical advanced components from trusted domestic
    sources?
        General Schoomaker. This is an effort led by the OSD, in which the
    Army participates. Long-term strategies being considered include
    assessing the possibility of additional research investments by the DOD
    and policy changes to help our integrated circuit suppliers compete in
    worldwide markets.
        Admiral Clark. I understand that the DOD is actively exploring
    long-term strategies and has established a Defense Science Board Task
    Force to examine this subject. These strategies will examine the root
    cause of offshore migration, the options for policy and DOD investment,
    alternatives to onshore trusted foundries and the development of
    requisite inspection technologies, enabling alternative inherently
    trustworthy processing technologies. There are currently two trusted
    foundries producing Rad Hard circuits in the United States. I
    understand the DOD is using Title III funds to upgrade these foundries
    to support current and future DOD Rad Hard circuit requirements.
        General Hagee. The Marine Corps is aware of the NSA proposal to
    establish a trusted foundry to ensure DOD first and assured access to
    critical advanced components from trusted domestic sources. However,
    long-term strategies of this nature are developed and lead by the DOD.
    We respectfully defer to the NSA at the DOD/agency level to provide
    insight on the long-term strategies to be considered and developed.
        General Jumper. Maintaining a strong industrial base for integrated
    circuits is a key element to ensuring the DOD with first and assured
    access to critical advanced components from trusted domestic sources.
    The DOD's Manufacturing Technology program aids in this quest by
    developing manufacturing technologies that enable affordable production
    and sustainment of current and future weapon systems.
        Another option for assured access is the Defense Production Act
    Title III program, which establishes, maintains, and/or expands a
    production capability necessary for national defense. This program is
    currently being used to establish a domestic fabrication capability for
    radiation-hardened microelectronics to meet critical requirements from
    the combined space community, including the Air Force, the Missile
    Defense Agency, the National Reconnaissance Office, and the National
    Aeronautics and Space Administration.

        92. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, what programs currently exist that address
    the issue of first and assured access to critical advanced components
    from trusted domestic sources?
        General Schoomaker. The principal program facilitating first and
    assured access to critical requirements is the Defense Priorities and
    Allocation System (DPAS). This program implements authority contained
    in Title I of the Defense Production Act. DPAS allows us to work
    through the Commerce Department to require priority acceptance and
    performance of orders placed with domestic sources, if those orders are
    within their capability.
        Admiral Clark. I understand the DOD and the NSA have undertaken a
    pilot program to address the vulnerability of critical Application
    Specific Integrated Circuits (ASICs) used in mission essential defense,
    communications, and national security systems. The program is a first
    step to support in identifying short and mid-term solutions that could
    supply the Department with advanced technology trusted ASICs. It is
    consistent with the approach set forth by the Deputy Secretary of
    Defense on October 10, 2003. The program is further defined in the
    subsequent interim guidance on the use of Trusted Integrated Circuits
    set forth January 27, 2004, from the Office of the Under Secretary of
    Defense for AT&L. The pilot program covers the requirements to ensure
    trust from basic circuit design to the finished wafer scale devices
    (not yet delineated into individual dies or packaged at this stage).
    Additional trusted ASIC sources will be identified and certified as
    required in the ongoing program. If necessary, the pilot program will
    expand by engaging additional trusted domestic suppliers of critical
    high end ASICs to encourage multiple sources and increased access to
    the most advanced technologies.
        General Hagee. Headquarters, Marine Corps C4 Department is aware of
    the NSA proposal to establish a trusted foundry to ensure DOD first and
    assured access to critical advanced components from trusted domestic
    sources. We respectfully defer this response to NSA.
        General Jumper. As mentioned, the DOD's current approach to address
    the issue of first and assured access to critical advanced components
    from trusted domestic sources calls for establishing a ``trusted
    foundry'' to ensure critical defense systems have a trusted source of
    semiconductor components available when needed by the Department.
        In addition, the DOD's Manufacturing Technology program helps
    strengthen the industrial base by developing manufacturing technologies
    that enable affordable production and sustainment of current and future
    weapon systems. The Defense Production Act Title III program can also
    assist by establishing, maintaining, and/or expanding a production
    capability necessary for national defense as is currently being done in
    the case of radiation-hardened microelectronics.

        93. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, does the DOD have plans to maintain the
    critical semiconductor equipment industry (i.e. lithography, photo
    masks) in the U.S., either through a government-industry consortium or
    through more direct intervention?
        General Schoomaker. This is related to an effort led by the OSD and
    the Defense Advanced Research Projects Agency (DARPA). The Army
    participates. We understand that maintaining the critical semiconductor
    equipment industry will be addressed as part of an upcoming Defense
    Science Board study entitled: High Performance Microchip Supply.
    Separately, but in close coordination with OSD and DARPA, the Army does
    fund direct research of improved semiconductor fabrication equipment as
    part of our effort to achieve Army research objectives. We plan to
    continue that funding effort.
        Admiral Clark. The DOD does not currently have plans to address
    maintenance of the semiconductor equipment industry. However, if any
    aspect of the semiconductor industry changes in such a manner that
    creates vulnerabilities or diminishes capabilities, we will explore
    options and take necessary action.
        General Hagee. Respectfully, we must defer to the Joint Staff and/
    or OSD to provide information on any DOD-wide plans to support the
    semi-conductor equipment industry.
        General Jumper. The DOD has not formulated any plans to establish a
    government-industry consortium or directly intervene in the
    semiconductor equipment industry. Accounting for less than 2 percent of
    total market sales of semiconductors and associated equipment, makes it
    difficult for the DOD to directly influence the industry. In fact, the
    last major consortium effort, SEMATECH, dropped Federal sponsorship in
    1996 and now includes international manufacturers. Instead, the DOD is
    currently pursuing a ``trusted foundry'' approach, which could
    contribute to the maintenance of a viable semiconductor industrial
    base.

        94. Senator Lieberman. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, will Congress have the opportunity to
    discuss the proposed solutions as they evolve?
        General Schoomaker. Yes.
        Admiral Clark. I expect the DOD will continue, as always, to work
    with Congress to explore solutions for securing trusted
    microelectronics for our warfighters.
        General Hagee. The Marine Corps will afford Congress the
    opportunity to discuss proposed solutions that are participated in and
    in support of the operational requirements that are of interest.
        General Jumper. As mentioned, the DOD is currently looking to
    existing efforts, such as the ``trusted foundry'' approach, its
    Manufacturing Technology program, and the Defense Production Act Title
    III program to provide for first and assured access to critical
    semiconductor components. Should additional solutions become necessary,
    Congress will be an essential element in the formulation and
    implementation of a national policy with regards to the semiconductor
    industry and other critical industries that support national defense.
                                     ______

                    Questions Submitted by Senator Jack Reed
                       science and technology investment
        95. Senator Reed. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, all of the Services have reduced their investments
    in transformational S&T programs significantly below the fiscal year
    2004 appropriated levels. What role do these S&T programs play in the
    transformation of our Nation's military?
        General Schoomaker. The fiscal year 2005 budget submission reflects
    the Army's sustained commitment to make leap-ahead S&T investments that
    will provide high payoff transformational capabilities for our
    soldiers. At $1.8 billion, the fiscal year 2005 S&T budget request
    continues the transformational programming strategy established last
    year.
        Army S&T is committed to providing America's Army with sustained
    overmatch in land combat. To do so, the Army S&T retains a dynamic
    portfolio of technology investments that is responsive to the
    warfighters' needs of today and the future. The Army S&T mission is to
    conceptualize and develop future leap-ahead technologies that are
    necessary to maintain a superior land combat capability unmatched
    anywhere in the world while exploiting opportunities to accelerate the
    transition of proven innovative technologies to enhance the
    capabilities of the Current Force. The Army's S&T program is well
    balanced to provide high payoff needs of the Future Force while seeking
    rapid transitions for critical capabilities into the Current Force.
        Admiral Clark. The Navy S&T accounts reflect the balance of
    priorities among the competing fiscal requirements. The fiscal year
    2005 Navy S&T budget request declines by 1.4 percent compared to the
    fiscal year 2004 budget request, but is well focused on supporting the
    warfighting capabilities outlined in the latest Naval Transformation
    Roadmap.
        The role of naval S&T is to guide innovation that will provide
    technology-based options for transformational Navy and Marine Corps
    capabilities, including capabilities that promise to fundamentally
    change how we prepare for, fight and win wars. A great deal of our
    transformational effort towards ``The Next Navy and Marine Corps'' is
    lodged in the Future Naval Capabilities (FNCs). We have strengthened
    alignment of the FNC process with the naval capabilities development
    process that establishes our warfighting program requirements and
    priorities.
        The relatively mature technologies involved in FNCs are in many
    cases the result of long term S&T investments in discovery and
    invention programs with 6.1 and early 6.2 funding. The focus of this
    discovery and invention portion of the S&T portfolio is largely on
    areas where the Navy is the only significant U.S. sponsor such as ocean
    acoustics and underwater weaponry. This stable, long term investment is
    essential to keeping the pipeline full of transformation enabling
    technologies for ``The Navy and Marine Corps After Next''.
        The final transformational S&T investment is in the area of
    Innovative Naval Prototypes. Examples of these ``game-changing''
    technologies include the free electron laser, the electromagnetic
    railgun, unmanned underwater vehicles, the X-Craft, and super-
    conducting electric drive motors.
        General Hagee. Naval S&T is pursuing innovative technology
    prototypes for equipment that we hope will have transformational impact
    in the future. There are numerous examples. We are developing a
    reconfigurable rotor blade for the MV-22 tiltrotor aircraft that when
    delivered will assist this revolutionary aircraft extend its range and
    load capacity to keep up with anticipated expansion of mission
    requirements. In effect, we are using S&T investment now to plan to
    upgrade a technology not yet operational.
        Another example is our investment in autonomous mobile sensors--
    Dragon Eye UAV and Dragon Runner Unmanned Ground Vehicle--as a means of
    providing the tactical element on the ground to see over the next hill
    or around the next comer. Dragon Eye is in the process of fielding;
    however, when coupled with potentially transformational changes in
    concepts of operations for ground units our ground forces may emerge
    from planned experimentation over the next couple of years into a
    distinctly different force.
        Still another example includes technologies leverage off of GPS
    permitting ground forces to know precisely their own location. Systems
    such as Blue Force Tracker--and specifically the Iridium-based
    Expeditionary Tactical Communications System as a surrogate for a
    future low-earth orbit tactical communications network, coupled with
    projects such as the Target Handoff System (Experimental) providing
    precise targeting and the ability to digitally coordinate targeting
    between the forces on the ground and tactical aircraft, may open the
    door for emerging new concepts for employing distributed operations on
    the future battlefield.
        General Jumper. Air Force S&T programs play a pivotal role in the
    transformation of our Nation's air and space force. The United States
    Air Force is continuing to transform to a capabilities-focused
    Expeditionary Air and Space Force. We are doing this through the
    development of the CONOPs for each of the seven major tasks the Air
    Force must be capable of accomplishing to support the combatant
    commanders. Our goal is to make the warfighting effects and
    capabilities we need to achieve them the drivers for everything we do.
    This is especially true for our S&T program. We have taken the effects
    and capabilities required by the seven CONOPs and transformational
    goals and mapped them to the long-term challenges and the short-term
    objectives identified in the congressionally-directed S&T planning
    review completed in February 2002. A prime example of the role Air
    Force S&T plays in this transformation is in the area of space
    communications technology. We have increased our investment in this
    area and are working to identify, develop, and demonstrate the wideband
    technologies needed to build a space-based laser communications network
    to provide higher data throughput. There are other technologies, such
    as directed energy, microsatellites, and more that will significantly
    change future warfighting capabilities.

                           3 percent investment goal
        96. Senator Reed. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, the DOD has again failed to meet its own goal of 3
    percent investment of the DOD topline into S&T programs. Does your
    Service still desire to achieve that 3 percent level?
        General Schoomaker. The Army supports the DOD's stated goal of
    investing 3 percent of Total Obligation Authority (TOA) in S&T. Over
    the past 4 years, the Army has sustained increases to its S&T
    investments to accelerate fielding the FCS and other Future Force
    capabilities while also seeking to identify mature technologies that
    can be provided to the Current Force--today's soldiers.
        Admiral Clark. The fiscal year 2005 Navy S&T budget request
    stabilizes funding at 0 percent real growth for the first time in 3
    fiscal years, and though it is not 3 percent of Navy TOA, it does
    provide a sufficient level of investment in this very important program
    for this year. Three percent remains our goal, but at the same time, we
    must recognize and balance competing investment priorities from year to
    year. We have done that in this year's budget and I expect we will
    continue to do so in the years to come.
        General Hagee. The Marine Corps complies with proposed Science
    Policy Council guidance to maintain or increase S&T investment at
    levels programmed in the fiscal year 2005 President's budget.
        General Jumper. The S&T funding goal of 3 percent applies to the
    DOD S&T program as a whole vice by individual Service. Therefore, when
    taking into account other non-Service S&T funding, such as funding
    managed by the DARPA, the individual Service goal can be lower. With
    respect to the Air Force S&T program, it is funded at almost 2 percent-
    close to a more realistic goal of 2 to 2.4 percent. At $1.9 billion in
    the fiscal year 2005 President's budget, Air Force S&T is funded at a
    level to achieve the warfighting capabilities needed to support Air
    Force Core Competencies. I believe this is a more meaningful yardstick
    by which to measure the adequacy of S&T funding.

        97. Senator Reed. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, is there a different investment goal that has been
    set for your Service?
        General Schoomaker. The Army is committed to a strong S&T program,
    but we have not set specific investment goals for S&T. We carefully
    evaluate our S&T investments to develop the technologies that will
    enable specific full spectrum capabilities for the Army's Future Force,
    while seeking opportunities to transition proven innovative
    technologies to the Current Force faster.
        Admiral Clark. The Navy's investment goal has been established by
    the DOD. It complies with DPG, and is consistent with the other
    Services.
        General Hagee. The Marine Corps complies with proposed Science
    Policy Council (SPC) guidance to maintain or increase S&T investment at
    levels programmed in the fiscal year 2005 President's budget.
        General Jumper. The Air Force has not set a formal percentage
    investment goal for its S&T program. However, I feel that 2 to 2.4
    percent is a realistic goal and will maintain current and future
    warfighting capabilities.

                              defense laboratories
        98. Senator Reed. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, what role do your defense laboratories and
    engineering centers play in the development of transformational
    technologies for your Service?
        General Schoomaker. The Army's laboratories and engineering centers
    play a critical role in developing and maturing the needed technologies
    in support of the Army's transformation objectives. A good example of
    the role the Army's labs and engineering centers have contributed to
    these objectives is the development and maturation of the Army's
    technology base in support of the FCS; the centerpiece of the Army's
    Future Force and key element of the Army's Transformation campaign
    plan. The Army's laboratories and engineering centers play a key role
    in maturing the technology base in partnership with the private sector
    to an adequate technical readiness level that enables the Army to
    proceed to a successful Milestone B system development and
    demonstration decision for the FCS. Additionally, the Army's
    laboratories and engineering centers helped to identify the critical
    technology areas deemed to be centrally important to successful
    development of the FCS architecture and its component platforms, and
    potential solution sources in order to achieve baseline threshold key
    performance parameters. The successful development of these critical
    technologies is essential to reduce the technical risk in the
    acquisition and fielding of the FCS equipped unit of action. As
    detailed engineering designs are developed and refined, it is expected
    that additional critical technologies will be identified in order to
    meet designated capability levels (threshold or objective). Here again,
    the Army's labs and engineering centers will play a major role in
    maturing these technologies to adequate technology readiness levels to
    achieve these needed capabilities for the FCS equipped unit of action.
        Admiral Clark. The labs and centers have a long history of
    developing technological innovations that have made significant
    contributions to transforming the fleet and force. The Navy's
    scientists and engineers continue to push the state of the art to
    achieve order of magnitude increases in warfighting effectiveness. As
    an example, the Naval Research Laboratory (NRL) continues its
    leadership in the development of unmanned platforms and technology for
    improved ISR capabilities. NRL has used its world-class expertise in
    these areas to deliver the Dragon Eye, a small UAV, for small unit
    tactical reconnaissance. The Dragon Eye is small, light, easy to
    transport, and easy to fly. Developed at NRL, this UAV has transitioned
    into the Marine Corps Force and is with the I MEF in Iraq. Scientists
    at NRL are continuing this effort to develop the next generation of
    transformational sensors and platforms in advanced tactical
    reconnaissance.
        General Hagee. Our laboratories and engineering centers, e.g., the
    NRL, Naval Surface Warfare Centers, and the Marine Corps Warfighting
    Laboratory, provide the synergy, expertise and coordination imperative
    for transformational technologies and experimentation.
        General Jumper. The various AFRL research sites are crucial in the
    development of the transformational technologies required as the Air
    Force continues to transform to a capabilities-focused Expeditionary
    Air and Space Force. In particular, there are many world-class research
    efforts ongoing across the AFRL. For example, we have completed and
    recently transitioned initial breakthrough work on eye and sensor laser
    protection developed at the Human Effectiveness Directorate, Brooks
    City Base, Texas, and at the Materials and Manufacturing Directorate,
    Wright-Patterson Air Force Base, Ohio. The information data wall
    currently being used in Afghanistan and Korea is the result of
    outstanding efforts by the Information Directorate at Rome, New York.
    We are also proud of our work at Tyndall Air Force Base, Florida, and
    their development of the Elastomeric Coating polymer, which is capable
    of protecting key buildings and installations from close proximity
    explosions, such as air dropped weapons or truck bombs and is currently
    being installed in the Pentagon Reservation. In addition to conducting
    world-class research, the AFRL works closely with universities and
    industry to focus their research efforts on transformational
    technologies relevant to the Air Force. These are but a few of the
    extraordinary contributions being made in our laboratory facilities
    around the country.

                      laboratory personnel demonstrations
        99. Senator Reed. General Schoomaker, Admiral Clark, General Hagee,
    and General Jumper, what is the status of the ongoing laboratory
    personnel demonstrations that are being executed at many of your
    Service laboratories?
        General Schoomaker. Since late fiscal year 1997, five Army-unique
    personnel demonstration projects were implemented under section 342 of
    the National Defense Authorization Act for Fiscal Year 1995. These
    demonstration projects were individualized experiments designed by each
    laboratory to meet its specific needs and requirements and they were
    ``generally similar in nature to China Lake,'' that is, most civilian
    personnel management decisions were delegated to the laboratory
    director at each Army laboratory. Two additional Army laboratories have
    designed and submitted demonstration project proposals; however, those
    proposals were not approved due to the emergence of the OSD National
    Security Personnel System (NSPS) and the OSD Best Practices Initiative.
    One Army laboratory has been approved for a second, 5-year experiment
    by its local bargaining unit. Currently, OSD is in the process of
    replacing all Army laboratory demonstration project experiments with a
    personnel demonstration project known as the Best Practices Initiative.
    It is generally agreed that these personnel authorities have enhanced
    the ability of the Army laboratories to successfully discharge their
    mission of support to the warfighter.
        Admiral Clark. Our laboratory personnel demonstrations at the Naval
    Sea Systems Command Warfare Centers and the NRL are fully implemented
    and operating well. They will continue until such time as the DOD
    issues its final Federal Register notice for the DOD Best Practices
    Demonstration Project. Once this notice is published, the Best
    Practices Demonstration Project will supersede these Laboratory
    Demonstration Projects and both these demonstration projects and their
    employees will be converted to the Best Practices Demonstration
    Project. The conversion schedule is still to be determined.
        If the Best Practices Demonstration Project is not implemented
    prior to October 1, 2008, the DOD NSPS may supersede the Laboratory
    Demonstration Projects at that time.
        General Hagee. The following is a partial excerpt of what Admiral
    Cohen approved: ``Our current personnel demonstration projects at the
    Naval Sea Systems Command Warfare Centers and the NRL are fully
    implemented and operating well. They will continue until such time as
    the DOD issues its final Federal Register notice for the DOD Best
    Practices Demonstration Project. Once this notice is published, the
    Best Practices Demonstration Project will supersede these Laboratory
    Demonstration Projects and both these demonstration projects and their
    employees will be converted to the Best Practices Demonstration
    Project. The conversion schedule is still to be determined.''
        General Jumper. At present, the Air Force Laboratory Demonstration
    Project, or Lab Demo, is currently ongoing and continues to provide the
    AFRL with flexibilities key to hiring critical S&E talent. These key
    flexibilities include a simplified classification system, broadband pay
    levels, and contribution-based compensation, all of which have been
    very successful and have ensured lab-unique requirements were
    accommodated. Once the recently authorized NSPS is implemented we
    anticipate it will also produce positive results in shaping our S&E
    workforce.

        100. Senator Reed. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, how have these demonstrations programs
    helped your laboratories fulfill their missions?
        General Schoomaker. The fundamental thesis of the Army's laboratory
    demonstration projects is to attract and retain a high-quality
    workforce to achieve quality Army laboratories and quality laboratory
    products. Army laboratories have been enhanced by providing individual
    laboratory directors/commanders greater managerial control over
    personnel functions and concurrently, expanding the opportunities
    available to employees through a more responsive and flexible
    laboratory personnel system unique to each laboratory, Specific
    demonstration project features which enhance the ability of the
    laboratory to attract high-quality employees include: (1) market-based
    salary setting by managers (broad banding), (2) new appointment
    authorities (Distinguished Scholastic Achievement and quality grouping
    which has abolished the OPM's ``Rule of Three''), (3) classification
    authority delegated to the laboratory director/commander, and (4)
    simplified classification which has transformed Army laboratories from
    antiquated classification-driven organizations to world-class
    performance-based laboratories, just to identify a few. Specific
    demonstration project features which enhance the ability of the
    laboratory to retain high-quality employees include: (1) compensation
    linked directly to employee performance which tracks straight to
    laboratory goals, (2) accelerated compensation for laboratory local
    interns, i.e., newly hired out of colleges/universities, (3)
    extraordinary performance recognition and compensation beyond that of
    the normal pay-for-performance processes, and (4) ability of the
    laboratory director to make a counter-offer (basic pay adjustment) as a
    result of a private sector employment offer to a mission-critical
    laboratory employee. The success of these demonstration features is
    illustrated by the fact that over the last 5 years, laboratories
    operating under provisions of personnel demonstration projects have
    been selected four out of five times as the Army's Research and
    Development Organization of the Year. These features, which mirror
    commercial practice, have further enabled the laboratories to become
    and remain competitive with their private sector counterparts.
        Admiral Clark. These demonstrations have helped personnel managers
    hire and retain highly skilled scientists, engineers and technicians,
    pay higher starting salaries as a recruitment tool, and reward high
    performing individuals. We believe that these tools will help us
    compete with the aggressive private sector jobs market for these highly
    skilled people.
        General Hagee. The following was what Admiral Cohen approved: ``The
    ability to hire and retain highly skilled scientists, engineers and
    technicians is critical to effective execution of the tasks assigned to
    our laboratories and centers. The demonstration projects have had
    overall positive impact on laboratory effectiveness because management
    has the capability, flexibility, and authority to pay higher starting
    salaries as a recruitment tool and reward high performing individuals
    thus retaining more of their top performers. This is critical in these
    times of technical personnel shortages and an aggressive private sector
    jobs market for highly-skilled personnel.''
        General Jumper. As mentioned, the flexibilities authorized by
    Congress under the laboratory personnel demonstrations projects have
    been very successful in enabling us to hire critical S&E talent for our
    workforce. This infusion of talent has helped to revitalize and bring
    new ideas into the S&E community, providing a larger talent pool from
    which to draw as we continue our transformation to a capabilities-
    focused Expeditionary Air and Space Force.

        101. Senator Reed. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, are there any other specific personnel
    authorities that your laboratory directors need to better accomplish
    their unique Service missions?
        General Schoomaker. The DOD laboratories have identified a number
    of specific personnel authorities which would certainly provide the
    opportunity to further enhance the Army's laboratories, to include: (1)
    an increase in the pay cap of difficult-to-recruit categories of DOD
    laboratory S&E to $200,000 (an authority provided to the National
    Institutes of Health); (2) an increase in the traditional 3R
    authorities (recruitment and relocation bonuses, and retention
    allowances) to 100 percent of basic pay, to permit retention allowance
    lump sum payments, and to permit the option of retention allowances as
    increases to basic pay, in order for the DOD S&T laboratories to
    attract and retain top quality S&E; (3) concurrently, to ensure a
    continuing flow of fresh new young S&E talent into the DOD laboratories
    by providing a financial incentive to older S&E to retire, an increase
    in the Voluntary Separation Incentive Pay to $50,000; (4) personnel
    services contracting to hire administrative and clerical labor,
    currently prohibited by Federal Acquisition Regulation 37-104, which
    would permit the laboratories to devote scarce in-house resources to
    the laboratory missions of research, development, and engineering
    support; and (5) restoration of the section 1113 authority from the
    National Defense Authorization Act for Fiscal Year 2001, which provides
    the ``authority for the experimental personnel program for scientific
    and technical personnel'' which terminates in October 2005. The full
    range of additional authorities for Army laboratory directors and
    commanders, requiring either new legislation or DOD policy revision,
    can be found in OSD, Research and Engineering, commissioned study
    titled ``DOD Laboratory S&E Workforce Framework of HR Features for the
    Alternative Personnel System'' published on September 30, 2002.
        Admiral Clark. There are two such authorities in the area of S&E
    candidate recruiting that would help to better accomplish our
    laboratory missions.
        First, authorization of a Direct Appointment of National Research
    Council (NRC) and American Society for Engineering and Education (ASEE)
    Postdoctoral Fellowship Program Participants upon successful completion
    of their programs would eliminate a duplicative, second competitive
    action under current Federal Government Direct Hire or Delegated
    Examining Authority. This could streamline the recruitment process
    (reducing work hours by an estimated 24 hours per case), and reduce
    hiring time by 4 to 12 weeks.
        Second, authorization of a Direct Appointment Authority for
    scientific, engineering, or medical occupations, to include an
    exemption from Title V hiring regulations, would provide true ``on-the-
    spot'' hiring authority. This authority would be applied only to those
    positions and occupations that meet the criteria of the OPM Research
    Grade Evaluation Guide or Part III or the OPM Equipment Development
    Grade Evaluation Guide and require specialized experience.
        General Hagee. Not all the labs and centers need exactly the same
    personnel authorities, as their staffing and recruiting challenges are
    often different. For example, some of the Navy's warfare/systems
    centers need to fill large numbers of entry-level positions every year,
    so the flexibility granted by their demonstration projects (categorical
    ranking and distinguished scholar) have been of benefit to them. In
    contrast, more than half of the hires made by the NRL are PhDs with
    specialized experience at the GS-12 level or above, so such open
    registers are of lower utility.
        Below are two specific personnel authorities that would benefit
    some or all of the Navy labs and centers.
    Recommendations to Improve Recruitment of S&E Candidates with
            Specialized Experience
        (1) Authorize a Direct Appointment of NRC and ASEE Postdoctoral
    Fellowship Program Participants upon successful completion of their
    associateship programs. This proposal would allow the appointment of
    specially qualified NRC and ASEE participants upon completion of their
    associateship program. NRC and ASEE Participants compete through an
    extensive national recruitment effort and rigorous evaluation scheme to
    qualify for consideration. This competition is significantly more
    stringent than the competition required under the Direct Hire or
    Delegated Examining Hiring Authorities. This proposal, if accepted,
    would eliminate a duplicative, second competitive action under current
    Federal Government Direct Hire or Delegated Examining Authority,
    streamline the recruitment process (reducing work hours by 24 hours per
    case), and reduce hiring time by 4 to 12 weeks.
        (2) Authorize a Direct Appointment Authority for scientific,
    engineering, or medical occupations. This proposal, which includes an
    exemption from Title V hiring regulations, would provide a true ``on-
    the-spot'' hiring authority for scientific and engineering research
    positions in professional scientific, engineering, or medical
    occupations that meet the criteria of the OPM Research Grade Evaluation
    Guide or Part III or the OPM Equipment Development Grade Evaluation
    Guide and require specialized experience.
        General Jumper. Previously mentioned flexibilities, such as a
    simplified classification system, broadband pay levels, and
    contribution-based compensation, have been very successful and have
    ensured lab-unique requirements were accommodated as we worked to hire
    critical S&E talent for our workforce. Once the recently authorized
    NSPS is implemented, we anticipate it will also produce positive
    results in shaping our S&E workforce. Until NSPS is fully implemented,
    it is too early to forecast if additional personnel authorities will be
    required to recruit and retain S&E talent for the laboratory.

                              repair requirements
        102. Senator Reed. General Schoomaker, you say in your posture
    statement that the Army has determined repair requirements for all OIF
    I units, and that the resulting workload is ``immense'' and a
    ``significant expansion of normal maintenance activities.'' You state
    further that Army readiness is directly dependent on the reset program,
    and that ``continued resourcing will be needed'' to ensure the Army's
    recovery from current operations. What is the total estimate for the
    Army's reset program, at present?
        General Schoomaker. The initial fiscal year 2004 cost estimate to
    reconstitute OIF and OEF equipment was based on experience from past
    operations, in-theater technical inspections, and emerging maintenance
    data emanating from current operations. The reset plan takes into
    consideration the full spectrum maintenance operations, from
    organizational level to depot. The estimate for fiscal year 2004 reset
    totals $5.2 billion: $2.9 billion for 10/20 and delayed desert damage,
    $1.5 billion for depot maintenance, and $.8 billion for Army
    prepositioned stocks, munitions, and second destination charges.
    Estimates are for the fiscal year 2004 reset; we have not identified
    fiscal year 2005 reset cost requirements.

        103. Senator Reed. General Schoomaker, how much of this has already
    been funded by the fiscal year 2004 supplemental?
        General Schoomaker. The fiscal year 2004 emergency supplemental
    funded $1.2 billion in depot maintenance requirements and $2.0 billion
    in 10/20 level maintenance and delayed desert damage. Additionally, we
    received another $208 million for transportation to move equipment to
    the depots and to commercialize some in-theater communications
    capability. This was particularly important in that it permitted us to
    redeploy several of the Army's unique communications units who were
    approaching their 1-year mark for deployment. We also received $712
    million in investment funds to purchase communications equipment,
    replacement stocks for our prepositioned equipment sets, and lethality
    and survivability equipment for both active and Reserve component
    soldiers.

        104. Senator Reed. General Schoomaker, how much is included in the
    fiscal year 2005 budget request?
        General Schoomaker. As I stated earlier, the fiscal year 2005
    budget only addresses peacetime requirements. The Army staff is
    developing cost estimates for the repair of OIF 2 and OEF 4/5 equipment
    that will return from theater. At this point, it is too early to
    discuss those estimates with a high degree of confidence. I do know
    that the fiscal year 2005 budget request does contain $89.1 million to
    purchase lethality and survivability equipment for our troops.

        105. Senator Reed. General Schoomaker, how do you expect to fund
    the remainder?
        General Schoomaker. While we have not yet received guidance on the
    focus of an emergency supplemental for fiscal year, I would expect some
    of the reset requirements to be funded from that source. In addition to
    requirements for fiscal year 2005, there will still be outstanding
    requirements from fiscal year 2004, especially in the investment
    accounts. Reset requirements are incremental to normal peacetime
    operations and so far have been appropriate candidates for using
    supplemental funds. Reset is critical to future readiness. If funding
    for reset is not provided to the Army in a fiscal year 2005
    supplemental, we will be forced to balance risk within the base budget
    to meet the requirement.

        106. Senator Reed. General Schoomaker, what is your current
    estimate of how much additional funding the Army would need from an
    fiscal year 2005 supplemental, at least for reset purposes?
        General Schoomaker. We have not yet received guidance from the OSD
    on what the focus of a fiscal year 2005 supplemental will be, but I
    have little reason to believe that resetting the force will be any less
    expensive than it will be for returning OIF I forces. Additionally,
    there will be some items we cannot get to in fiscal year 2004 for which
    the requirements will carry into fiscal year 2005.

                          university research programs
        107. Senator Reed. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, what role do your investments in fundamental
    (6.1) research at small high-tech businesses and universities play in
    the fulfillment of your Service missions?
        General Schoomaker. The Army's basic research program produces new
    knowledge to fuel revolutionary advances and leap-ahead technology that
    enable Army Transformation. The program invests in world-class
    expertise (government, academic, and industry) and state-of-the-art
    equipment. It balances its investment between in-house Army unique
    research and leveraging external scientific research that has great
    potential for military applications.
        The Army maintains an extramural basic research program that is
    balanced between its two major components: (1) the single investigator
    program that invests in the brightest minds at our leading universities
    and is a key source of next-generation of scientists and engineers with
    an understanding of military problems, and (2) larger scale
    partnerships with universities and industry to take advantage of
    commercial investments and the cutting edge research at outstanding
    universities in areas critical to the Future Force.
        In regard to the second component, the external basic research
    program takes advantage of the power of academia and industry, focuses
    world-class research on Army challenges, allows flexibility to capture
    new discoveries, trains the next generation of scientists and engineers
    critical to the advancement of Army technology, and complements
    internal efforts through the following centers:

             Collaborative Technology Alliances (CTAs) are
            industry-led 6.1 collaborations between the government,
            industry and academia, combining industry investment in areas
            critical to transformation while taking advantage of cutting
            edge research at universities, and the Army laboratories'
            understanding of military requirements to leverage state-of-
            the-art technology for military applications.
             University Affiliated Research Centers are university-
            led 6.1 and shared 6.2 collaborations between universities,
            industry, and Army laboratories where industrial partners
            provide competence in related technologies, expertise in
            transitioning technologies from laboratories to the industrial
            sector, and cost share.
             Centers of Excellence are university 6.1 research
            centers established by the Army, and provide partnering
            opportunities between academia and Industry through cooperative
            agreements, when there is a significant synergy between the
            Center and the production capabilities of industry, but only
            the university is funded.
             The Army's new Flexible Display Center is university-
            led, with strong industry participation and collaboration with
            Army laboratories but has 6.2, 6.3, and ManTech funding.

        The Army also engages small businesses with S&T investments through
    the small business innovative research program; however, this involves
    applied research. The Army continues to exploit the opportunities
    created by these organizations to accelerate development of
    transformational capabilities to a lighter, smaller, smarter, and
    faster force.
        Admiral Clark. The 6.1 (S&T Account) investments that we have made,
    including those made in small, high-tech businesses and in
    universities, have assisted in the fulfillment of the Navy's mission in
    one of the most fundamental ways possible: they have laid the
    groundwork for our future. Much of the maturing technology being
    delivered today for incorporation into platforms, weapons, sensors, and
    process improvements are the result of long-term investments in
    research and invention programs in 6.1 and early 6.2 funding
    categories. These investments also serve to attract the Nation's best
    scientific talent, most of which resides in small, high-tech companies
    and in universities. This helps focus them on uniquely naval problems
    such as Ocean Acoustics and Underwater Weaponry that might otherwise
    receive little attention.
        General Hagee. The Marine Corps has no 6.1 funding. The Office of
    Naval Research (ONR) supports the 6.1 requirements for the Navy.
    However, the following was what Admiral Cohen approved ``Yes,
    historically, The ONR's investment in basic research helps support the
    training of research S&E. The NRL receives a large share of the Navy's
    6.1 investment (roughly $100 million annually). The Navy's warfare
    centers and medical labs share the ILIR program (about $15 million
    annually). These funds are used to help develop appropriately trained
    scientists and engineers in key disciplines.
        In addition, ONR is working with the National Science Foundation
    (NSF) to start a $10 million pilot program, commencing in fiscal year
    2005, that is focused on bringing into the Naval Research Enterprise
    the next generation of scientists and engineers. This program, called
    N-STAR, is focused on revitalizing connections between the Navy's
    research and development centers and the university community.''
        General Jumper. Basic Research, or 6.1, plays a key role in the Air
    Force S&T program, laying the foundation for later Applied Research, or
    6.2, and Advanced Technology Development, or 6.3, efforts. In fact, Air
    Force ``core'' Basic Research is funded at $217.3 million in the fiscal
    year 2005 President's budget--an increase of almost $13 million or
    almost 5 percent real growth, over the fiscal year 2004 President's
    budget. With approximately 70 percent of Air Force 6.1 funding going
    primarily to universities and some small high-tech companies, they play
    a fundamental role in helping to fulfill our Air Force mission.

                    personnel for commander joint task force
        108. Senator Reed. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, I understand the decision has been made to
    establish a combined force headquarters in Iraq in between CJTF-7 and
    General Abizaid. I would like each of you to give me your military
    judgment about the need for an additional headquarters, as well as some
    estimate of how much each of your Services would be expected to
    contribute and the impact of providing still more senior servicemen and
    women as headquarters personnel.
        General Schoomaker. The Army is fully supportive of the combatant
    commander's structuring headquarters to provide the required command
    and control, unity of command, and unity of effort in their area of
    operations. It is important to have a headquarters structured to meet
    these requirements as the Coalition Provisional Authority (CPA)
    conducts the transfer of authority in Iraq. This new headquarters will
    focus on coordinating the counterinsurgency campaign, civil-military
    operations, building Iraqi security and Armed Forces capabilities, and
    reconstruction efforts.
        The planning for the combined force headquarters is ongoing;
    therefore, we do not have defined personnel requirements. It is
    anticipated that the new headquarters will be formed from existing
    headquarters, maximize the capabilities within those headquarters, and
    through efficiencies avoid large increased demand for additional senior
    soldiers.
        Admiral Clark. Senator, it is my understanding that this decision
    is not final. However, JFCOM has been directed to develop options and
    recommendations for replacing CJTF-7, the single joint headquarters
    currently responsible for all strategic, operational and tactical
    issues in Iraq, with a command structure that consists of two joint,
    combined headquarters: a multinational force headquarters that would
    tackle the strategic and politico-military issues in Iraq, and a
    subordinate warfighting headquarters that would focus on operational
    and tactical tasks.
        In my view, such a structure would improve current CJTF-7
    headquarters span of control challenges, enhance our effort to
    establish a secure and stable Iraq, and at the same time, permit
    General Abizaid to focus on integrating and commanding the larger war
    on terror and regional security efforts throughout all of CENTCOM.
    While the specific service manpower contribution is yet undefined, I
    expect to be able to address any manpower concerns as JFCOM's
    recommendation comes forward.
        General Hagee. As this question was generated in March 2004, it is
    overcome by events. CJTF-7 has become Multi-National Force Iraq (MNF-
    I). The Commander of the CENTCOM is the appropriate entity to answer
    the question on personnel and force requirements to support any
    combined force headquarters.
        General Jumper. Doctrine and our current command structure informs
    us as to what this new combined force headquarters should be, and that
    is the Joint Force Land Component Commander (JFLCC) and staff. The
    JFLCC is responsible for planning coordinating and executing all land
    component actions in the AOR. The Air Component, commanded by the
    JFACC, is prepared and primed to provide the required support to the
    JFLCC in this endeavor. In addition, we are prepared to provide an Air
    Component Coordinating Element (ACCE) in the JFLCC headquarters as we
    did during OIF to facilitate and synchronize our operations. We feel
    this is the ``best practices'' option and should be used in this
    situation, as it is the most efficient for managing limited air
    resources. However, we will support the combatant commander's proposed
    C2 structure to the best of our ability and our limited resources. We
    will provide a limited ACCE, but we will not be able to field a
    component headquarter for this new combined force headquarters, nor do
    we believe it is best to distribute air resources down to this new
    command.

                                     budget
        109. Senator Reed. General Schoomaker, Admiral Clark, General
    Hagee, and General Jumper, I understand that, at the current pace of
    operations in Iraq and Afghanistan, you may still be short as much as
    $5-10 billion beyond funds provided in the fiscal year 2004
    supplemental. Is that true, and if so, how do you expect to address
    these shortfalls?
        General Schoomaker. Based on input from the field, we do have
    shortfalls. We are working to minimize these by asking our commanders
    to redouble their efforts to carefully review expenditures and
    reconcile supply requisitions to avoid duplication. As the field
    submits additional requirements, a group in the Army Staff, led by the
    Deputy Chief of Staff for Operations (G3), Lieutenant General Dick
    Cody, carefully reviews and validates them. Once requirements are
    validated, they are prioritized for available funding. To fund these
    critical, emerging priorities, we are reviewing all Army programs to
    determine if these new requirements are so compelling that we need to
    defer other planned expenditures to fund them. This is an ongoing
    process and it will undoubtedly continue through the remainder of the
    year. At mid-year, we will discuss shortfalls with OSD and we expect
    some relief. Right now, I believe we may need help in the range of
    about $3 billion for operations and maintenance-type requirements.
    Finally, we may have to come back with an omnibus reprogramming action
    to meet our most critical requirements.
        Admiral Clark. The fiscal year 2004 supplemental was predicated on
    a post-OIF pace of operations. For the Navy, this assumption has
    changed dramatically because of the decision to deploy a MEF and
    supporting Navy elements. Our current estimate is that the Navy will
    incur over $700 million in unplanned costs during fiscal year 2004
    related to this OIF 2 deployment. This estimate is likely to change as
    we gain experience with the pace of operations and actual return costs.
    At this time, the DOD plans to realign the necessary funds, both from
    the amounts provided in the supplemental and the fiscal year 2004
    appropriations act, to cover the increased costs of OIF 2.
        General Hagee. Our current shortfall estimate continues to evolve
    with recent deployments in support of OIF 2 and OEF 5. We intend to
    address these shortfalls with assistance from the Iraqi Freedom Fund
    (IFF) and internal reprogramming actions. The Marine Corps continues to
    work with the Under Secretary of Defense (Comptroller) to resolve the
    balance and address changing requirements as operating tempo and actual
    manpower fluctuate.
        General Jumper. The Air Force received $350 million less than
    requested for operations and maintenance (O&M) in the fiscal year 2004
    supplemental. We have asked the DOD for $252 million from the IFF for
    O&M items such as airlift, combatant commander support, and our support
    to the Army. Provided our current O&M program is not reduced, we
    believe we can make it to the end of the year through prudent
    management. However, we will have to bypass and/or delay some items or
    activities we deem important, but not mission critical.

        110. Senator Reed. General Schoomaker, I believe that the Army is
    currently spending about $3.5 billion each month to support operations
    in Iraq and Afghanistan, and that, assuming OIF 2 develops as is
    currently projected (that is, no major force reductions beyond what is
    already anticipated), you would run through your ``base budget'' by as
    early as March 2004. What is your current estimate for how much the
    Army would need to support planned operations in Iraq in fiscal year
    2005 and how soon do you need those funds?
        General Schoomaker. We are currently spending about $1 billion a
    month in military pay and an average of $2.5 billion a month in O&M to
    sustain operations in the global war on terrorism. These expenditures
    are incremental to our normal, peacetime operating costs. Our
    preliminary data for January indicates that we have a total year to
    date O&M expenditure, base program and global war on terrorism, of
    $19.4 billion. Our base O&M program for fiscal year 2004 is $25.5
    billion. If we had been forced to conduct our current level of
    operations without having received the fiscal year 2004 supplemental
    early in the year, we would be in a position to ``burn out'' in March.
        At this point, we have not received guidance from the OSD on what
    the parameters of a fiscal year 2005 supplemental will be. We would
    expect the parameters to include a cost of sustaining operations and we
    will develop cost estimates for resetting our returning units, but we
    do not know what the scope of the mission will be as we begin fiscal
    year 2005. If our fiscal year 2005 burn rate were similar to fiscal
    year 2004, we would exhaust our O&M base budget by mid-March 2005, and
    our military personnel, Army base budget by the end of May 2005.

        111. Senator Reed. General Schoomaker, how different would the
    impact be if you received those funds in October or November as opposed
    to March or April?
        General Schoomaker. We do not yet know the level of effort that
    will be required in fiscal year 2005. If we assume it will remain the
    same as what we are providing in fiscal year 2004, as you stated in
    your previous question, we would normally prefer to receive
    supplemental funding earlier in the year, rather than later. If forced
    to fund operations in support of global war on terrorism ahead of
    receiving a supplemental, we lose the flexibility to address critical
    emerging requirements and are forced to pay, in the short term, for
    current operations from our base appropriations. As an example, in our
    O&M program through end of January, a third into the fiscal year, we
    are 42 percent obligated overall. Without the supplemental, we would be
    about 76 percent obligated against our base O&M program. If we had not
    received the early supplemental, and with only a quarter of the base
    program left, we would be forced to defer nearly all spending beyond
    operations in the theater until supplemental funding is received.

        [Whereupon, at 1:03 p.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                             TUESDAY, MARCH 2, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

                              SERVICE SECRETARIES

        The committee met, pursuant to notice, at 9:34 a.m. in room
    SH-216, Hart Senate Office Building, Senator John Warner
    (chairman) presiding.
        Committee members present: Senators Warner, McCain, Inhofe,
    Collins, Chambliss, Cornyn, Levin, Akaka, and Ben Nelson.
        Committee staff members present: Judith A. Ansley, staff
    director; and Leah C. Brewer, nominations and hearings clerk.
        Majority staff members present: Brian R. Green,
    professional staff member; William C. Greenwalt, professional
    staff member; Ambrose R. Hock, professional staff member;
    Gregory T. Kiley, professional staff member; Thomas L.
    MacKenzie, professional staff member; Lucian L. Niemeyer,
    professional staff member; Diana G. Tabler, professional staff
    member; and Richard F. Walsh, counsel.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; Creighton Greene, professional staff
    member; Maren R. Leed, professional staff member; Gerald J.
    Leeling, minority counsel, Peter K. Levine, minority counsel;
    and Michael J. McCord, professional staff member.
        Staff assistants present: Michael N. Berger, Andrew W.
    Florell, and Nicholas W. West.
        Committee members' assistants present: Christopher J. Paul,
    assistant to Senator McCain; John A. Bonsell, assistant to
    Senator Inhofe; Jayson Roehl, assistant to Senator Allard; Arch
    Galloway II, assistant to Senator Sessions; James P. Dohoney,
    Jr. and Derek J. Maurer, assistants to Senator Collins; Clyde
    A. Taylor IV, assistant to Senator Chambliss; Meredith Moseley,
    assistant to Senator Graham; Russell J. Thomasson, assistant to
    Senator Cornyn; William K. Sutey, assistant to Senator Bill
    Nelson; Eric Pierce, assistant to Senator Ben Nelson; and
    Andrew Shapiro, assistant to Senator Clinton.

           OPENING STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner. Good morning, everyone. We have a most
    unusual day before us. The Senate has, on the floor, a series
    of at least five to seven amendments. The votes start at 11:30,
    therefore we're going to try and get this hearing completed in
    2 hours time; otherwise it would be a very considerable
    inconvenience to our distinguished witnesses.
        So we welcome you with that cheerful news. I know how well
    you've prepared, and you have, each of you, a half-hour opening
    statement, ready for a barrage of questions. [Laughter.]
        But I think, in this instance, Senator Levin and I will
    give short statements. We'll proceed, then, to receive
    hopefully somewhat abbreviated statements on your behalf, and
    then you'll just have to work with us as we have members coming
    and going through the course of the hearing.
        We start this hearing this morning with news reports out of
    Baghdad which are quite disturbing. In our hearts and minds are
    the welfare of the men and women of the Armed Forces and a very
    large number of civilians, who are doing their very best to
    bring about a degree of democracy in that troubled part of the
    world. So the posture statements this morning relate, of
    course, to the President's defense budget, which, in itself, is
    subject to scrutiny here on Capitol Hill by a number of persons
    who have considered the overall fiscal situation facing the
    Nation. Acting Secretary Brownlee, Secretary England, and
    Secretary Roche, we welcome you.
        We'll start by recognizing, again, the professionalism of
    the men and women of our Armed Forces, together with our
    coalition partners. They have been very successful in executing
    complex joint military operations around the world in the
    ongoing global war on terrorism. In Iraq and Afghanistan, our
    forces defeated brutal regimes quickly, with precision, and
    continue to provide stability and support as those nations move
    toward democracy. The men and women of the Armed Forces--
    active, Reserve, and National Guard--supported by civilian
    employees and contractors, have performed magnificently. This
    is proof of the training, equipment, and readiness that you
    have provided, their service, and their sacrifices, and the
    sacrifices of their family--we always must remember that--are
    deeply appreciated, most particularly by those who lost their
    lives and those who bear the wounds of this conflict and the
    conflicts, of course, in Afghanistan.
        Military operations continue at a high tempo in Iraq and
    Afghanistan, the Balkans, and elsewhere around the world. At
    the same time, we must prepare now for the future, a future
    fraught with new threats and new challenges.
        The President's budget request anticipates this uncertain
    future. That's why this Senator strongly supports the
    President's budget, at the level of $401.7 billion for defense.
    The budget continues the President's strong commitment to
    safeguard America, and sends a strong signal, to the world, of
    America's resolve.
        Since our Nation was attacked on September 11, much has
    been asked of each of your respective Services. Over the past
    several years, we have seen hundreds of thousands of soldiers,
    sailors, airmen, and marines deployed around the world, to
    fight the global war on terrorism, and to maintain our forward
    presence. At the same time, we have asked the services to
    transform to meet future threats. We're all aware of the hard
    choices you must make in your departments when deciding whether
    or not to trade a dollar of today's readiness to invest a
    dollar in modernizing for this challenging and uncertain
    future. I know each of you is looking for better, more
    efficient ways to use your limited resources, from developing
    new capabilities, to introducing new organizational structures,
    to better integrating the Guard and Reserve with the Active
    Force. The Army's modular brigades, the Navy's fleet response
    plan, and the Air Force's aerospace expeditionary force concept
    are but a few of the innovations and capabilities that we look
    forward to discussing with you today.
        As Congress works its will on the President's budget
    request, we must be mindful of the potential problems. We are
    putting increased demands on our forces around the world,
    increased demands on their families, and increased demands on
    our Reserve and National Guard. We are fortunate, as a Nation,
    with a military that has responded to these demands with
    extraordinary commitment, but even the best military has its
    limits.
        As we perform our annual budget review, we must, and we
    will, carefully analyze the effects of these challenges on our
    men and women in uniform, and their families. Congress will,
    I'm confident, make the investments needed to ensure we have
    the people, the capabilities, and the facilities necessary to
    meet these future threats.
        There are many questions. To assist the committee, I hope
    each of you will address the following in your opening
    statements. Do we have enough people in your respective
    military departments, the right mix of people, and the
    capabilities in your departments to meet the threats of the
    foreseeable future? Are we doing all we can to ensure that our
    forces deployed overseas, both active and Reserve components,
    have the best possible equipment and support? Are the lessons
    learned from recent military operations being rapidly, real-
    time integrated within your departments and the operational
    forces? As we reposition forces to meet new global threats, do
    we have the facilities, the infrastructure, and the mobility
    that we will need? Are we doing everything we can to provide a
    safe, constructive environment for the patriotic young men and
    women who volunteer to serve our Nation? These are but a few of
    the issues we hope to explore with you today.
        We have the best Armed Forces in the world. We don't say
    that boastfully. It's absolutely substantiated by fact. It can
    be sustained with smart investment, strong leadership, and the
    continued sacrifices of our individual soldiers, sailors,
    airmen, and marines, and their families. We will do our part by
    providing them the resources they need to successfully execute
    their missions in the cause of freedom, and to protect us here
    at home. I commend each of you. You've been in office now for
    some period of time, and I think you've done commendable
    performances in leadership of your respective departments.
        So, Senator Levin?

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman. Let me join you in
    welcoming our witnesses and thanking them for their service to
    this Nation.
        Our forces, as you indicate, Mr. Chairman, continue this
    year to be heavily engaged in ongoing operations, including a
    rotation of troops and equipment in and out of Iraq that has
    been said to be the largest since World War II. Nearly 120,000
    troops will depart Iraq, to be replaced by nearly 110,000
    others. The demand on the Active Force, particularly the Army,
    is so great that the proportion of Reserve component forces
    serving in Iraq will increase from the current 20 percent to
    nearly 40 percent of the total in this next rotation. Marine
    Corps units, which were withdrawn last summer, will be
    returning to Iraq in this rotation to replace some of the
    departing Army units. Those same Army units, after a very short
    rest, will be busy reorganizing, retraining, and refurbishing
    their equipment in preparation for a potential return to Iraq
    in a year's time.
        It is reported that 11,000 U.S. troops operating in Eastern
    Afghanistan are coordinating offensive actions more closely
    with Pakistani forces operating in Western Pakistan in a
    renewed effort to go after the principal terrorist threat to
    our Nation. Additionally, almost 40,000 more U.S. troops stand
    their ground in Korea, confronting the undeniably-serious
    conventional and potential nuclear threats posed by the regime
    in North Korea. Thousands more serve in stability operations in
    the Balkans and the Sinai, and now, once again, in our own
    hemisphere, in Haiti.
        So I join with you, Mr. Chairman and other members of this
    committee, in renewing our pledge to our military men and
    women, and to their families, that we will work to ensure that
    they continue to receive the best training and the best
    equipment that our Nation can provide, and that they and their
    families are appropriately compensated and supported as is
    befitting the service that they render to our Nation.
        The President's defense budget request for $420 billion
    represents an estimate of the cost of the normal operations of
    the activities within the defense budget function for fiscal
    year 2005. However, the budget does not include any request to
    support the incremental costs that our military forces in
    fiscal year 2005 will incur in continuing operations in Iraq,
    Afghanistan, or Haiti. Administration officials have further
    said that they do not intend to seek any funds for a
    supplemental to pay for these incremental costs this calendar
    year. That is not a responsible way to support our troops, and
    it is not responsible budgeting. We should provide for those
    costs that we can reasonably predict that our forces will
    incur. We should not force our Armed Forces to rob from
    existing requirements to pay for these operations.
        Congress provided an extra $65 billion to support
    operations in Iraq and Afghanistan during fiscal year 2004. It
    turns out that these funds will not even be sufficient to cover
    all the incremental costs of these operations until the end of
    the fiscal year. So we cannot count on any excess carryover
    funding to address these problems in fiscal year 2005 until a
    mid-year supplemental can be enacted.
        At an earlier hearing before this committee, the Chiefs of
    Staff of the Army and Air Force, the Chief of Naval Operations
    (CNO), and the Commandant of the Marine Corps all expressed
    concerned about waiting until after the end of calendar year
    2004 to submit a supplemental budget request. Hopefully, our
    service secretaries will tell us this morning whether they
    share the concerns of their service chiefs; and, if so, whether
    they are urging the Secretary of Defense and the President to
    seek such supplemental funding from Congress on an urgent and a
    timely basis.
        The delay in requesting the supplemental is only part of
    the problem. Press reports indicate that administration
    officials plan on asking for $50 billion in supplemental
    funding for fiscal year 2005, but the requirement will likely
    be much higher. In fact, Army officials have indicated that the
    Army's requirement alone may equal or surpass that amount. The
    Army Chief of Staff testified that the Army is currently
    spending $3.7 billion a month in Iraq, and $900 million a month
    in Afghanistan. He has also testified that he received approval
    from the Department of Defense to temporarily increase Army end
    strength by 30,000 soldiers, an increase that he intends to pay
    through supplemental appropriations. That will potentially add
    an additional cost of nearly $4 billion a year.
        One other point about supplementals. The current
    supplemental is probably insufficient to meet the current needs
    of the Armed Forces through September 30. Ongoing funding needs
    are apparently several billion dollars higher than that which
    the President requested from Congress and which we appropriated
    for the supplemental for this year. Consequently, the Army will
    have to find the funding in its regular budget this year to
    make up the sizeable difference.
        This under-funding of supplemental requirements is already
    having an effect on the transformation effort. Recently, the
    Army decided to terminate its only new helicopter program, the
    Comanche. Although the Army leadership has said that the
    changing operational environment, coupled with the emerging
    ability of joint systems to provide the capability originally
    intended of Comanche were factors in that decision, it seems
    clear that funding constraints were of equal, if not greater,
    significance.
        Meanwhile, the Army must still deal with significant
    unfunded requirements to complete armoring of trucks in Iraq
    and Afghanistan, and for the refurbishing of the heavily used
    equipment from those ongoing military operations.
        Having terminated its future air-combat system, I would
    hate to see the Army forced to do the same to its ground future
    combat systems to meet requirements related to ongoing
    operations that may also go unfunded by future supplemental
    appropriations.
        While perhaps not as extreme as the Army, the other
    services are facing similar challenges, as the leaders of those
    services have recently testified. We, in Congress, cannot allow
    those challenges to become problems through the neglect to
    address them on a timely basis.
        So, Mr. Chairman, I, again, look forward to discussing
    these and other issues with our witnesses this morning.
        Senator Inhofe [presiding]. Thank you, Senator Levin.
        Without objection, some of you who weren't here during
    Senator Warner's opening statement, we will have votes at
    11:30, and we're going to try to expedite this, so, if you
    don't mind, we won't have further opening statements, and we'll
    go right ahead into the opening statements of our secretaries.
        We'll start with Secretary Brownlee.
        Secretary Brownlee, let me mention, this morning we had an
    Army Caucus meeting. It was very well attended. General
    Schoomaker did an excellent job.
        We'll recognize you now for your opening statement.

      STATEMENT OF HON. LES BROWNLEE, ACTING SECRETARY OF THE ARMY

        Secretary Brownlee. Thank you very much, Mr. Chairman.
        Distinguished members of the committee, thank you for the
    opportunity to appear before you today, along with the
    Secretary of the Navy and the Secretary of the Air Force. When
    I appear before this distinguished committee with the wonderful
    public servants to my left, I have to admit, again, I feel much
    like a mule entered in the Kentucky Derby here, but I shall do
    my best.
        I'm especially honored to have the opportunity to testify
    before this distinguished committee on the status of the Army.
    I have a prepared posture statement, and, with your permission,
    would like to submit that statement for the record.
        Senator Inhofe. Without objection, all full statements will
    be a part of the record.
        Secretary Brownlee. Let me begin by expressing my gratitude
    for your tremendous support for our soldiers, who are serving
    our country around the world, as well as to their families at
    home. This support comes from the members, as well as from your
    dedicated, professional, and personal staff. Your interest and
    involvement in the Army's activities has made a significant
    difference in our soldiers' welfare and their mission
    accomplishment. To the Members and staff of this distinguished
    committee, on behalf of the United States Army, thank you all.
        I know that you're deeply interested in the great work our
    soldiers are doing, their training and morale, and how we are
    equipping them. In the last 9 months, I've visited our troops
    in Iraq three times, and those in Afghanistan twice, and
    traveled to our posts in Germany, South Korea, and here in the
    United States. I'm grateful to have the opportunity to share
    what I've learned with you.
        As Senator Levin indicated, we have proposed to grow the
    Army, temporarily, by 30,000 soldiers over the next several
    years, using the authority in title 10, and to be paid for from
    supplemental appropriations. We will plan to use these
    resources to stand up at least ten new combat brigades over the
    next several years, and we ask for your support in that
    endeavor.
        Many of you have asked me about measures we are taking to
    protect our forces in Iraq. I would like to address two in
    particular. First, the number of up-armored high-mobility
    multipurpose wheeled vehicles (HMMWVs) in the Central Command
    area of responsibility is now over 2,000, compared to about 500
    last spring. You will recall that when General Schoomaker and I
    testified before this committee in November, we estimated then
    that we would be unable to satisfy the CJTF-7 requirement in
    Iraq of 3,000 up-armored HMMWVs until May 2005. The committee
    indicated that they found that unacceptable, as did we, and we
    have worked with the manufacturers to steadily increase
    production of these vehicles, and will continue to do so, going
    from 185 produced this month, up to 220 per month by May,
    which, with summary distribution, will enable us to produce the
    current Central Command Combined Forces Land Component Command
    (CENTCOM CFLCC) requirement of 4,149 vehicles by August 2004.
        I've talked to the chief executive officers of these
    companies that build these up-armored HMMWVs, and visited their
    production lines. They are committed to and capable of
    increasing production rates to up to 450 per month to help us
    fill our requirements even faster. While this will require
    additional resources, I am working within my budget and with
    the Office of the Secretary of Defense (OSD) so that we can
    achieve this accelerated production level as quickly as
    possible.
        Second, there has been concern about every soldier having
    the best-available protection against bullets and explosive
    fragments. To provide this protection, we increased the
    production of interceptor body armor last fall, and are
    currently producing and shipping 25,000 sets monthly to the
    theater of operation. There are now sufficient stocks of
    interceptor body armor (IBA) to equip every soldier and the
    Department of Defense (DOD) civilian in Iraq and Afghanistan,
    and we will fill our requirement for the remainder of the
    soldiers and DOD civilians in theater by the end of this month.
    In summary, we are producing enough interceptor body armor so
    all soldiers now rotating into theater will be issued a set of
    body armor either before they deploy into Iraq or immediately
    after arrival in Afghanistan.
        Underlying everything we are doing and planning to do is
    the most important point I want to make here today. We are an
    army at war, serving a Nation at war.
        Let me comment on a matter of grave importance to the
    senior leadership of the Army, sexual assaults on soldiers by
    fellow soldiers. Such attacks not only weaken unit cohesion and
    lessen combat power, they are wrong. They will not be
    overlooked, and they will not be tolerated. The Army is
    committed to identifying and holding accountable those who
    commit such actions, as well as committed to providing proper
    care for the victims of such attacks. We are dedicated to
    creating an environment and command climate where these young
    women feel free to report these incidents through multiple
    venues: the chain of command, medical channels, chaplains, as
    well as their peers. We will properly care for those who have
    been assaulted, and investigate and take appropriate action
    against those perpetrating these crimes. It is the right thing
    to do, and we are going to do it.
        The Army provides relevant and ready campaign-quality land
    power to combatant commanders as a part of the joint force. To
    better do this, we are transforming the Army itself in response
    to lessons learned and experience gained by the Army's recent
    2\1/2\ years with combat in the global war on terror, as well
    as the operational environments envisioned in the foreseeable
    future.
        Last Monday, the Chief of Staff of the Army, General Pete
    Schoomaker, and I, announced the termination of the Comanche
    helicopter program as part of a major restructuring and
    revitalization of Army aviation. In lieu of completing
    development and procuring 121 Comanche helicopters in the
    fiscal year 2005 through fiscal year 2011 Future Years Defense
    Plan (FYDP), we will propose to reallocate these resources to
    procure almost 800 new aircraft for the active and the Reserve
    components. As a part of our total program over the FYDP, we
    will also enhance, upgrade, and modernize over 1,400 aircraft
    in our existing aviation fleet. This program to revitalize Army
    aviation reflects the changed operational environment, and will
    provide the modularity and flexibility we must have to achieve
    the joint and expeditionary capabilities that are so essential
    to the Army's role now and in the future.
        Additionally, we are restructuring our Active and Reserve
    Forces to meet the challenges of the day, and to more
    effectively use the resources that Congress and the American
    people have entrusted to us. This is an ongoing process, and we
    will keep Congress fully informed.
        The fiscal year 2005 President's budget we've submitted,
    when amended to reflect the termination of Comanche, represents
    a balanced consideration of both our current and long-term
    requirements, and provides our Army with the resources we need,
    excluding war-related costs.
        The tempo of our current operations is high, and has human
    and material costs. We appreciate the assistance of Congress in
    addressing these issues as we work to restore our units and
    equipment to the high levels of readiness necessary to continue
    to meet our obligations to the Nation.
        In all that the Army has accomplished, and in all that it
    will be called upon to do, the American soldier remains the
    single most important factor in our success. Today, our
    soldiers are present in over 120 countries around the world,
    representing the American people and American values with
    courage and compassion.
        I want to express my appreciation for the service and the
    enormous sacrifices made by our soldiers, especially those who
    have given the last full measure--and their families--as we
    meet the challenges and risks posed by the war on terror. Our
    deepest thanks go to the members of our active and Reserve
    component units, as well as to the thousands of the Department
    of Army civilians who are also deployed overseas in harm's way.
    Regardless of where our soldiers serve, they perform as the
    professionals they are, with skill, courage, and dedication.
    They embody the values of our Army and our Nation, serving
    selflessly, and seeking only to do what must be done before
    returning home.
        Despite remarkable successes, our fight is far from over.
    It will take time to win the war on terror. Our enemies are
    resolute, but hardline al Qaeda operatives in Iraq have already
    recognized that they cannot dislodge our forces by fear or
    intimidation. Our commitment to prevail in Iraq and elsewhere
    is unshakeable. I have seen the resolution in our soldiers'
    eyes, and heard the determination in their voices. We must do
    our part to ensure they have all they need to do the job we
    have set before them. When the American people and our leaders
    stand behind them, they can accomplish any task on earth.
        We are transforming the Army while retaining the values
    critical to the Army's achievements of the past 228 years. The
    fiscal year 2004 defense legislation and supplemental
    appropriations have enabled the Army to do that which it has
    been asked to do. I look forward to discussing with you how the
    fiscal year 2005 budget request will permit us to continue
    meeting our obligations now and in the years to come.
        Mr. Chairman, in closing, I would like to thank you and the
    members of this distinguished committee for your continuing
    support for the men and women in our Army, an army at war, and
    a full member of the joint team deployed and fighting terror
    around the world.
        I appreciate this opportunity to appear before you today,
    and I look forward to answering your questions.
        [The joint prepared statement of Secretary Brownlee and
    General Schoomaker follows:]
       Joint Prepared Statement by Hon. R.L. Brownlee and Gen. Peter J.
                                   Schoomaker
        Our Nation is at war. The security of our homeland, the global war
    on terror, and sustained engagement around the world define today's
    complex and uncertain strategic environment. The future will be no less
    ambiguous.
        We must prepare now to meet the challenges of tomorrow. Rather than
    focusing on a single, well-defined threat or a geographic region, we
    must develop a range of complementary and interdependent capabilities
    that will enable future Joint Force Commanders to dominate any
    adversary or situation. A capabilities-based approach to concept and
    force development, as articulated in the 2001 Quadrennial Defense
    Review, is the major focus of defense transformation.
        Over the past year our Army has met the demands of the global war
    on terror, with more than 325,000 troops deployed around the world in
    over 120 countries. The Army was instrumental in the defeat of Saddam
    Hussein and the Taliban and the subsequent liberation of more than 46
    million people from oppression and despair. The Army remains a central
    and critical participant in Operation Iraqi Freedom and Operation
    Enduring Freedom. Although these and other operations have stressed the
    force, our soldiers have responded magnificently.
        Our Army's commitment to the Nation remains absolute. While we
    execute the global war on terror, our Army simultaneously continues its
    organizational and intellectual transformation to meet the challenges
    of the 21st Century. In support of the National Security Strategy and
    the National Military Strategy we are improving our warfighting
    readiness and ability to win decisively. We also remain dedicated to
    the well-being of our soldiers, their families, and our civilian
    workforce.
        The United States Army is the most powerful land force on earth.
    With this power comes a great responsibility. American soldiers show by
    their daily actions that they understand this, and are fully worthy of
    the trust the American people have placed in them.
        For 228 years the Army has never failed the Nation, and it never
    will.

                                       R.L. Brownlee,
                                               Acting Secretary of the
                                                   Army.

                                       Peter J. Schoomaker,
                                               General, U.S. Army, Chief of
                                                   Staff.
                        purpose of the posture statement
        The Army Posture Statement provides an overview of today's Army.
    Focusing on the soldier, the centerpiece of the force, it explains the
    current and future strategic environments that provide our mandate for
    transformation. Our core competencies and how we intend to meet our
    current demands and future challenges are outlined. It describes what
    we must become in order to provide more ready and relevant forces and
    capabilities to the Joint Team.
                 2004 army posture statement executive summary
    Our Nation at War
        Our Nation, and our Army, are at war. It is a different kind of
    war, fought against a global terrorist network and not likely to end in
    the foreseeable future. In the days following the attacks on September
    11, 2001, President Bush spoke candidly to the Nation. ``These
    terrorists kill not merely to end lives, but to disrupt and end a way
    of life.'' He added: ``The only way to defeat terrorism as a threat to
    our way of life is to stop it, eliminate it and destroy it where it
    grows.''
        Our Army exists to fight and win our Nation's wars. We are an
    integral member of the Joint Team committed to winning in fulfillment
    of our responsibilities to national security. We are fighting to
    preserve the American way of life and to safeguard the many freedoms
    our citizens enjoy. Our soldiers and their families have not forgotten
    the events of September 11, which launched us to action in Afghanistan
    and Iraq. They are reminded daily of the ongoing conflict through
    separation, concern for forward-deployed loved ones and, most
    regrettably, news of casualties. Our Army continues the mission and
    remains committed to defeating our enemy.
    Our Army's Core Competencies
        As our Army fights the current war and remains dedicated to
    transforming, we are focused on our two core competencies: (1) Training
    and equipping soldiers and growing leaders; (2) Providing relevant and
    ready land power to combatant commanders as part of the joint force.
        Our Army must be an agile and capable force with a Joint and
    Expeditionary Mindset. This mindset is the lens through which we view
    our service. We must be mobile, strategically deployable and prepared
    for decisive operations whenever and wherever required. We must be
    lethal and fully interoperable with other components and our allies, as
    well as flexible, informed, proactive, responsive, and totally
    integrated into the joint, interagency, and multinational context. Our
    management and support processes must reflect and support these same
    characteristics.
    Strategic Environment--Our Mandate for Transformation
        At the end of the Cold War, the United States had no peer
    competitor. Our Army was much larger and was built around heavy,
    mechanized, and armored formations. Because America stood as the lone
    superpower during this time of global realignment, we were able to
    downsize our force structure. Today, the future is uncertain and
    presents many challenges. The emerging challenges manifest themselves
    as new adaptive threats, employing a mix of new and old technologies
    that necessitate changes to the ways in which the elements of our
    national power are applied.
        The 21st century security environment is marked by new actors and a
    noteworthy proliferation of dangerous weapons, technologies and
    military capabilities. While threats from potentially hostile regional
    powers remain, increasingly non-state actors, operating autonomously or
    with state-sponsorship, also are able to endanger regional and global
    security. These forces--insurgents, paramilitaries, terrorists,
    narcotraffickers, and organized crime--are a growing concern. They
    often are networked and enabled by the same tools and information
    systems used by state actors. Our adversaries will rely more frequently
    on indirect and asymmetric methods, such as anti-access and area-denial
    strategies, unrestricted warfare and terrorism, to mitigate their
    relative disadvantage. The most dangerous of these threats are the
    development and proliferation of weapons of mass destruction (WMD)--
    including biological or chemical agents, or radiological ``dirty
    bombs''--to attack the United States. This security environment
    requires that the Army have the capability to dominate throughout the
    spectrum of conflict and to plan for multiple future contingencies.
        As a result of this adaptive enemy and our worldwide commitments,
    current organizations, systems and facilities are and will continue to
    be stressed. We now rely on our Reserve component to support our
    operations to a degree not seen since World War II. As of January 14,
    2004, there were more than 164,000 Reserve component soldiers mobilized
    with over 139,000 of them serving overseas. The institutional Army is
    being asked to do more, applying lessons learned from current
    operations. These lessons are critical to our organizations and
    individual soldiers as they prepare for worldwide missions. Therefore,
    the current and future strategic environments require the Army to have
    the capability to dominate throughout the spectrum of conflict and to
    plan for multiple contingencies. These new security challenges, coupled
    with the current war on terrorism, require a different approach.
    Army Focus Areas
        Last summer, Army leaders identified immediate focus areas
    instrumental to adapting Army organizations and processes that will
    help us to better meet the Nation's security requirements. All of our
    focus areas should be viewed in the context of our ongoing efforts to
    retain the campaign qualities of our Army while simultaneously
    developing a Joint and Expeditionary Mindset. Of these focus areas, a
    critical enabler is the redesign of our resource processes to be more
    flexible, responsive, and timely. Our goal is to be a better Army every
    day--better able to execute our core competencies as members of the
    Joint Team.
    Adapting Resource and Acquisition Processes
        The resource process is at the core of our Army's mission success.
    Our Nation faces a cunning and adaptive enemy, predictable only in his
    zeal and intent. We are just as cunning and our soldiers are constantly
    changing tactics and techniques in order to disrupt the enemy's plans.
    In the same way, our resource and acquisition processes must become
    more flexible, responsive, and timely in order to take immediate
    advantage of technological improvements and to sustain the quality of
    the force over time.
    Resetting our Force
        Quickly resetting our forces upon their redeployment from current
    operations is a strategic imperative. The reset program incorporates
    lessons learned from Operation Iraqi Freedom (OIF) and Operation
    Enduring Freedom (OEF), retrains essential tasks, adjusts pre-
    positioned stocks of equipment and ammunition, and brings unit
    equipment readiness back to standard. Units must recover quickly in
    order to provide the combatant commanders with land-power capabilities
    for future requirements. We will face challenges as we rotate troops
    from deployment to home station, while simultaneously maintaining
    vigilance and readiness.
        Continued congressional support and adequate resources are needed
    to accomplish our reset tasks and to mitigate the risk we have incurred
    to our Current and Future Forces. The fiscal year 2004 defense
    legislation and supplemental appropriation delivered substantial
    assistance toward covering the cost of current operations and
    initiating the reset process. We fully appreciate the exceptional
    support members and their staffs have provided this year. But, the job
    is not complete. In fact, it has only just begun.
    Mitigating Strategic Risk Through Increased Land Power Capability
        Today our Army is executing operations in defense of the homeland
    (Operation Noble Eagle); stability and support operations in the
    Balkans (Stabilization Force/Kosovo Force); peacekeeping in the Sinai
    as part of the Multinational Force and Observers (MFO) and combat
    operations in Iraq and Afghanistan (Operation Enduring Freedom/
    Operation Iraqi Freedom). We are also forward stationed in Korea and
    elsewhere. Approximately two-thirds of our active and Reserve combat
    formations were deployed in fiscal year 2003 and will be deployed in
    fiscal year 2004.
        These deployments, coupled with planned future rotation of units
    into OIF and OEF, the largest movement of Army troops since World War
    II, have highlighted already existing stress to our force. To mitigate
    risk, the Army is embarking on a series of initiatives. The first
    initiative is resetting forces returning from OIF and OEF to a standard
    higher than before their deployment. A second establishes force
    stabilization measures to reduce turbulence amongst soldiers, units,
    and their families. Third, the Army is internally rebalancing active
    and Reserve component forces to better posture our existing force
    structure to meet global commitments. Lastly, we are beginning to
    increase the number of available combat brigades through improved force
    management and modular reorganization. This increase allows the Army to
    improve strategic flexibility, sustain a predictable rotation cycle,
    and permits the Reserve component to reset.
        To facilitate this end state, the Army will seek to maintain, or
    even to increase temporarily, its current level of manning. These
    measures, when resourced, will mitigate risk and ultimately provide
    increased capability to combatant commanders.
    Conclusion
        Our Nation is at war and our Army is at war; we remain ever
    relevant and ready to meet today's challenges. Yet there is much more
    to do. We are prioritizing wartime requirements, incorporating next-
    generation capabilities into current systems where appropriate, and
    preserving essential investments in the Future Force. We also are
    becoming more joint and expeditionary. We do not move forward alone,
    but as part of the Joint Team. We need the support of the American
    people and the U.S. Congress. With this backing, we'll continue to
    carry the fight to our enemies to provide security here at home.
                               core competencies
        Our Army has two core competencies, supported by a set of essential
    and enduring capabilities. These core competencies are: (1) training
    and equipping soldiers and growing leaders; and (2) providing relevant
    and ready land-power capability to the combatant commanders as part of
    the joint force. Additionally, our Army's senior leadership has
    established immediate focus areas and issued specific guidance for
    planning, preparation, and execution of actions aimed at rapidly
    effecting necessary transformation in support of these core
    competencies. See Addendum I (available at www.Army.mil) for more
    information on the Army's focus areas.
                   train and equip soldiers and grow leaders
        Our Army prepares every soldier to be a warrior. Our training
    replicates the stark realities of the battlefield in order to condition
    soldiers to react instinctively in combat. Such training is essential
    to building soldiers' confidence in themselves, their equipment, their
    leaders, and their fellow soldiers. Constant training in weaponry and
    field craft, and a continuous immersion in the warrior culture, give
    soldiers the skills they need to succeed on the battlefield. Mental and
    physical toughness are paramount to the development of the warrior
    ethos and apply to all soldiers from private to general. Every soldier
    is called upon to be a leader.
    The Soldier
        The American soldier remains the centerpiece of our combat systems
    and formations and is indispensable to the Joint Team. Adaptive,
    confident, and competent soldiers, infused with the Army's values and
    warrior culture, fight wars, and win the peace. As a warrior, every
    soldier must be prepared to engage the enemy in close combat; the modem
    battlefield has no safe areas. Our Army trains our soldiers to that
    standard, without regard to their specialty or unit. The soldier--
    fierce, disciplined, well-trained, well-led, and well-equipped
    ultimately represents and enables the capabilities our Army provides to
    the joint force and the Nation.
        Our soldiers are bright, honest, dedicated, and totally committed
    to the mission. All share common values, a creed and a warrior ethos.
    Our Army defines selfless service as putting the welfare of our Nation,
    Army and subordinates before your own. Soldiers join the Army to serve.
    Most Americans do not fully realize the personal sacrifices these
    soldiers and their families endure. However, our soldiers know that
    they have done their part to secure our Nation's freedoms and to
    maintain the American way of life.
        Our Soldiers' Creed captures the warrior ethos and outlines the
    professional attitudes and beliefs that characterize our American
    soldier. The warrior ethos is about the refusal to accept failure and
    the conviction that military service is much more than just another
    job. It defines who soldiers are and what soldiers do. It is linked to
    our long-standing Army values, and determination to do what is right
    and do it with pride.
        Recruiting and Retaining a High-Quality Volunteer Force
        All of our soldiers are warriors whose actions have strategic
    impact. Because we are at war and will be for the foreseeable future,
    we must recruit soldiers who have the warrior ethos already ingrained
    in their character, who seek to serve our Nation, and who will have the
    endurance and commitment to stay the course of the conflict. We must
    recruit and retain soldiers who are confident, adaptive, and competent
    to handle the full complexity of 21st century warfare.
        We will continue to bring the highest quality soldier into the
    force. All newly enlisted soldiers are high school graduates (diploma
    or equivalent) and 24 percent have some college. These young Americans,
    who believe service to our Nation is paramount, make our success
    possible. They display a willingness to stand up and make a difference.
        Our recruiting and retention efforts continue to be successful. The
    active Army met its recruiting and retention goals in fiscal year 2003.
    The Army National Guard exceeded its retention goals for fiscal year
    2003 and simultaneously met its end strength objectives. The Army
    Reserve met its recruiting goals and all but one retention target in
    fiscal year 2003. Most importantly, all components sustained their end
    strength requirements.
        We do not know yet the effect the high operational pace of recent
    months will have on our recruiting and retention in fiscal year 2004
    and future years. We must carefully monitor recruiting and retention
    trends and adequately resource our successful recruiting and retention
    initiatives. Incentives such as the Enlistment Bonus Program, The Army
    College Fund, and the Loan Repayment Program, have successfully enabled
    the Army to execute precision recruiting in fiscal year 2003. Our
    Special Forces Candidate ``Off the Street'' initiative continues to
    attract highly motivated and qualified warriors. Significantly,
    Selective Reenlistment Bonuses, such as the Present Duty Assignment
    Bonus and the Theater Selective Reenlistment Bonus, which are intended
    to enhance unit stability, have helped us realize our retention
    successes. For more information on recruiting, see Addendum C.
    Civilian Component Enhances our Capabilities
        Army civilians are an integral and vital part of our Army team.
    They are essential to the readiness of our Army at war and our ability
    to sustain operations. Our civilian employees share our Army values.
    They are smart, resourceful, and totally committed to supporting our
    soldiers and our Army to do whatever it takes to meet the challenges
    that come our way. These dedicated civilians perform critical, mission-
    essential duties in support of every functional facet of combat support
    and combat service support, both at home and abroad. Army civilians
    serve alongside soldiers to provide the critical skills necessary to
    sustain combat systems and weaponry. They work in 54 countries in more
    than 550 different occupations. In fiscal year 2003, nearly 2,000 Army
    civilians deployed to southwest Asia in support of Operation Iraqi
    Freedom, Operation Enduring Freedom, and the global war on terrorism
    (GWOT). They have the education, skills, and experience to accomplish
    the mission while ensuring continuity of operations for all commanders.
    Realistic Training--Essential to Mission Success
        Tough, realistic training ensures that our soldiers and units
    maintain readiness and relevance as critical members of the joint
    force. Our Army's combined-arms training strategy, including an
    appropriate mix of live, virtual, and constructive training, determines
    the resource requirements to maintain the combat readiness of our
    troops. We revised our training ammunition standards to allow Combat
    Support and Combat Service Support units to conduct live fire exercises
    under conditions similar to those they might encounter in combat.
        The Army's tempo of operations (OPTEMPO) budget is among its top
    priorities. Our leadership is committed to fully executing the active
    and Reserve component ground and air OPTEMPO training strategies, which
    include actual miles driven and hours flown, as well as virtual miles
    associated with using simulators. The flying hour program is funded to
    achieve a historic execution level of live flying hours per aircrew per
    month. If units exceed the historic execution level, our Army will
    increase their funding. Thus far this year, OPTEMPO execution reports
    show units exceeding their programmed miles driven and hours flown.
    These are the units that are aggressively preparing for deployments to
    OIF and OEF, as well as the units who recently have returned and are
    preparing for future operations. Our combined arms training strategy is
    working and sustaining our warfighting readiness. We see the results
    every day in Afghanistan and Iraq.
    Joint and Expeditionary
        Our Army is the dominant ground component of the Joint Team and
    provides the Joint Force Commander a campaign quality force with unique
    and complementary capabilities. We are vital and indispensable members
    of the Joint Team first and are a Service second. We must remain aware
    that our Army always conducts operations--offensive, defensive,
    stability, and support--in a joint and expeditionary context. Acting in
    concert with air and naval power, decisive land power creates a synergy
    that produces a joint force with abilities far exceeding the sum of the
    individual service components. Our Army can: support civil authorities
    at home and abroad; provide expeditionary forces at the right time and
    the right place; reassure our allies and multinational partners; deter
    adversaries and, should deterrence fail, decisively defeat the enemy;
    and win the peace through post-conflict operations, in concert with
    interagency and multinational efforts. Our Army must continually
    examine the capabilities resident in and required by the joint force.
    We will concentrate our energies and resources on those attributes
    which our Army is best suited to provide to the joint force. Our Army
    will arrive on the battlefield as a campaign-quality force fulfilling
    the requirements of the Joint Force Commander--lethal, agile, mobile,
    strategically responsive, and fully interoperable with other components
    within the interagency and multinational context.
    Train and Educate Army Members of the Joint Force
        Our Army is taking action across a broad front to make jointness an
    integral part of our culture by including this concept in our education
    and training programs. We have always produced leaders with the right
    mix of unit experience, training, and education. As we look to the
    future, we know that, to meet our current and future leadership
    requirements and those of the joint force, we must redesign aspects of
    our Army's training and leader development programs to include lessons
    learned from current operations. Our objectives are to increase our
    ability to think and act jointly and to provide our soldiers with the
    latest and most relevant techniques, procedures and equipment that will
    make them successful on the battlefield. Additionally, the changes
    acknowledge the current and projected pace of operations and
    deployments. As a result, we will be better prepared for the current
    and future strategic environments.
        Maintaining a ready Current Force today and achieving a transformed
    Future Force tomorrow requires a shift in the way units train for joint
    operations. Our Army's Training Transformation Initiative (TTI), which
    supports the June 2003 Defense Department Training Transformation
    Implementation Plan, provides dynamic, capabilities-based training and
    mission rehearsal in a joint context.
    Leader Development--Train for Certainty, Educate for Uncertainty
        Leader development is an essential part of our Army's core
    competencies and the lifeblood of our profession. It is the deliberate,
    progressive and continuous process that develops our soldiers and
    civilians into competent, confident, self-aware, adaptive, and decisive
    leaders. They emerge prepared for the challenges of 21st century
    combined arms, joint, multinational, and interagency operations.
        Army leaders at all levels bear responsibility for America's
    soldiers and accomplishing the mission, whatever it may be. The range
    of missions and their complexity continue to grow, presenting our
    leaders with even greater challenges than previously experienced. The
    evolving strategic environment, the gravity of our strategic
    responsibilities, and the broad range of tasks that the Army performs
    require us to review, and periodically to refocus, the way we educate,
    train and grow professional warfighters.
        We have a training and leader development system that is unrivaled
    in the world. Our professional military education prepared our officers
    and noncommissioned officers to fight and win in Iraq and Afghanistan.
    We will continue to develop our leaders with the right mix of
    operational assignments and training and education opportunities that
    meet the current and future requirements of the Army and joint forces.
    Our leader training focuses on how to think, not what to think. We will
    maintain our investment in the future by sustaining the highest quality
    leader training and education for our Army.
    Combat Training Centers (CTC)/Battle Command Training Program (BCTP)
        The CTC program is a primary culture driver for our Army.
    Additionally, our CTCs are a primary enabler of, and full participant
    in, the Joint National Training Capability. The CTCs develop self-aware
    and adaptive leaders and soldiers and ready units for full spectrum,
    joint, interagency, and multinational operations. CTCs continuously
    integrate operational lessons learned into the training. Our Army
    enhances the training experience offered by our CTCs (National Training
    Center in California, Joint Readiness Training Center in Louisiana,
    Combat Maneuver Training Center in Germany and Battle Command Training
    Program based in Kansas) by increasing the focus on development of
    capabilities essential to joint operations. Leader training and
    development during CTC exercises hone the joint and expeditionary
    mindset and promote our Army's warrior culture.
      provide relevant and ready land power capabilities to the combatant
                          commander and the joint team
        To meet global commitments across the full spectrum of military
    operations, our Army has mobilized more than 164,000 Reserve component
    soldiers. More than 325,000 American soldiers are serving overseas and
    more than 23,000 soldiers are supporting operations within the United
    States. This high operating tempo is no longer an exception. Sustained
    operations and deployments will be the norm for our Army forces
    supporting multiple and simultaneous shaping and stability operations
    around the globe. At the same time, we will continue to contribute to
    joint force execution of major combat operations, homeland security
    missions, and strategic deterrence.
    Army Global Commitments
        Our Army is engaged in more than 120 countries throughout the
    world. To highlight our Army's commitment, a review of the major
    warfighting formations of the active and Reserve component serves as a
    measurable benchmark. Over 24 of the Army's 33 active component brigade
    combat teams (BCTs), and 5 of our 15 Reserve component Enhanced
    Separate Brigades (ESB) were deployed in fiscal year 2003. This trend
    will continue in fiscal year 2004, with 26 of 33 active component BCTs
    and 6 of our 15 Reserve component ESB brigades projected for
    deployment.
        The majority of these combat formations are deployed in the U.S.
    Central Command (CENTCOM) area of responsibility (AOR), effectively
    executing stability and support operations. More than 153,000 soldiers
    are supporting CENTCOM operations in Iraq, Afghanistan, Kuwait, and the
    Horn of Africa. We are currently in the middle of the largest movement
    of troops since WWII, as we rotate more than eight-and-a-half divisions
    and two ESBs to or from the theater. The approximate ratio of active to
    Reserve component forces today is currently 63 to 37 percent,
    respectively. Once our current rotation is complete, the ratio will
    change to approximately 54 to 46 percent, active to Reserve component.
    Since September 11, we have mobilized almost half of the Reserve
    component. They are trained, professional, and ready to execute any
    task.
        Army support to other combatant commanders remains high. U.S.
    Northern Command's (NORTHCOM) Army component, U.S. Army Forces Command,
    provides more than 23,000 active and Reserve component soldiers for
    duty in the defense of our homeland. These troops are available for
    missions including Military Assistance to Civil Authorities (MACA),
    emergency preparedness, and antiterrorist operations. The Army Reserve
    provides to NORTHCOM significant voice and data connectivity necessary
    to execute real-time operations. U.S. European Command provides forces,
    such as V U.S. Corps, to CENTCOM; and to Stability Force (SFOR) and
    Kosovo Force (KFOR) in the Balkans. U.S. Pacific Command supports
    ongoing operations in the Philippines, as part of the global war on
    terrorism, in addition to maintaining more than 31,000 soldiers on the
    Korean Peninsula. U.S. Southern Command is fully engaged as the
    headquarters for 1,500 soldiers executing detainee operations at
    Guantanamo Bay, Cuba; has deployed 740 soldiers to Joint Task Force--
    Bravo at Soto Cano Airbase, Honduras; and is assisting the government
    of Colombia in its war on narcoterrorism. U.S. Special Operations
    Command's Army component provides professional, dedicated, and
    specially trained soldiers to each combatant commander. These soldiers,
    working closely with conventional forces, have been instrumental to our
    success in the global war on terrorism. In addition to Federal
    missions, our Army National Guard (ARNG) plays an important domestic
    role, routinely responding to State emergencies. In fiscal year 2003,
    there were 280 requests for emergency support, ranging from basic human
    needs to engineering support during natural disasters. Our ARNG has
    fielded 32 Weapons of Mass Destruction (WMD) Civil Support Teams (CST),
    which assist first responders in the event of an incident. Another 12
    CSTs are due to be activated within 18 months. To date, these teams
    have responded to 74 different requests for support. Also, more than
    8,000 ARNG soldiers have executed critical force protection duties at
    148 Air Force installations in CONUS.
    Resetting the Force
        The extraordinary demands major combat and stability operations in
    Afghanistan and Iraq are placing on our equipment and personnel require
    that our Army quickly reset returning units for future national
    security needs. The reset program will incorporate lessons learned from
    OIF and OEF, retrain essential tasks, adjust prepositioned stocks of
    equipment and ammunition, and bring unit equipment readiness back to
    standard. The objective is to ensure our Army forces are ready to
    respond to near-term emerging threats and contingencies. However, reset
    cannot be viewed as a one-time event. Reset will continue to be key to
    our future readiness as our military executes our national security
    missions.
        Through reset, all returning active duty and Army Reserve units
    will achieve a sufficient level of combat readiness within 6 to 8
    months of their arrival at home station. The Army National Guard will
    take longer to achieve the desired level of readiness. The goal for
    these units is to reestablish pre-deployment readiness within 1 year.
    Our Army also will take advantage of reset as an opportunity to
    reorganize units into modular designs that are more responsive to
    regional combatant commanders' needs; that better employ joint
    capabilities; that reduce deployment time; and that fight as self-
    contained units in nonlinear, noncontiguous battlespaces. This effort
    began with the 3rd Infantry Division and will soon be expanded to
    include the 101st Airborne Division (Air Assault).
        In addition to investing in new equipment to replace items that
    were destroyed or worn out during combat and stability operations, the
    reset program will repair major items used in OIF and OEF. Repair
    requirements have been determined for all OIF I units and the workload
    for this comprehensive effort is immense: about 1,000 aviation systems;
    124,400 communications and electronics systems; 5,700 combat/tracked
    vehicles; 45,700 wheeled vehicles; 1,400 missile systems; 9 Patriot
    battalions; and approximately 232,200 items from various other systems.
    This effort represents a significant expansion of normal maintenance
    activities, requiring the increased use of continental United States
    (CONUS) and outside the continental United States (OCONUS) based depot,
    installation and commercial repair facilities.
        Reconfiguring existing Army prepositioned stocks for global
    coverage of potential missions is a major component of the reset
    process. The intent is for each stock to have sufficient combat power
    to meet the immediate threat, as well as enough materials to render
    relief in other contingencies.
        Congressional support, in the form of supplemental appropriations,
    has been invaluable in beginning the reset effort. Our readiness
    depends directly on the successful execution of the reset program, and
    it will remain an ongoing priority for the foreseeable future.
    Continued resourcing will be needed to ensure that our Army can fight
    the current war and posture itself for future missions.
    Transformation: Moving from the Current to the Future Force
        The goals of Army transformation are to provide relevant and ready
    forces that are organized, trained and equipped for full-spectrum
    joint, interagency and multi-national operations and to support Future
    Force development. Army transformation occurs within the larger context
    of changes to the entire U.S. military. To support our Army staff in
    the execution of transformation, the Army leadership directed the
    establishment of an Army Training and Doctrine Command (TRADOC) Futures
    Center, operational as of October 2003.
        Our current force is organized, trained and equipped to conduct
    operations as part of the joint force. It provides the requisite
    decisive land power capabilities that the Joint Force Commander needs
    across the range of military operations: support to civil authorities
    at home and abroad; expeditionary forces; the ability to reassure
    friends, allies and multinational partners; dissuading and deterring
    adversaries; decisively defeating adversaries should deterrence fail;
    and winning the peace as part of an integrated, interagency, post-
    conflict effort. Our future force is the operational force the Army
    continuously seeks to become. Informed by national security and
    Department of Defense guidance, it is a strategically responsive,
    networked, precision capabilities-based maneuver force that is dominant
    across the range of military operations envisioned for the future
    global security environment.
        As our Army develops the future force, it simultaneously is
    accelerating select future doctrine, organization, training, materiel,
    leadership, personnel, and facilities (DOTMLPF) capabilities into our
    current force. This process will be fundamental to our success in
    enhancing the relevance and readiness of our Army and prosecuting the
    global war on terrorism. Similarly, the operational experience of our
    current force directly informs the pursuit of future force
    capabilities.
    Balancing Current and Future Readiness
        Balancing risk between current and future readiness remains a
    critical part of our Army's transformation process and one that
    requires continual assessment to ensure that plans and programs are
    aligned with overall requirements. Without question, the issue of
    current operational readiness is our Army's highest priority. During
    the past several years, our Army made a conscious decision to accept a
    reasonable degree of risk to the readiness of our current force in
    order to permit investment in capabilities for our future force. This
    risk came in the form of reductions in and limitations to modernization
    and recapitalization programs. As part of the past four budget
    submissions, our Army made difficult choices to cancel and restructure
    programs, shifting resources to the development of transformational
    capabilities. Some of these investments have already produced results:
    for example, the new Stryker Brigade Combat Team formations now being
    fielded, the first of which is currently deployed on the battlefield in
    Iraq. Others are helping to develop emerging technologies and
    capabilities that will be applied to our force throughout the coming
    decade.
        Besides the ongoing efforts related to equipping the current force,
    our Army also has begun other major initiatives that will improve our
    readiness and relevance in the future. These include an effort to
    realign active and Reserve component units and capabilities, in order
    to make our Army more readily deployable and available to Joint Force
    Commanders; home-basing and unit-focused stability, which will improve
    readiness and reduce personnel turbulence; and the reorganization of
    Army units into more modular and capability-based organizations.
        While the previous decisions to accept reasonable risk in our
    current force were considered prudent at the time, the strategic and
    operational environment has significantly changed in light of the
    large-scale engagement of Army forces in Operation Iraqi Freedom and
    other expeditionary operations. Ever-changing demands on our force,
    coupled with our commitment to mitigating risk to our soldiers, have
    necessitated re-examination and transformation of our Army's resource
    process and business practices (see Addendum H at www.Army.mil).
    Making the Resource Process More Responsive
        The resource process is our Army's center of gravity. Without the
    right people, the proper equipment, top-notch installations, and
    adequate dollars to support all appropriately, our Army would not be
    able to fulfill its duty to our Nation.
        In order to maintain our premier warfighting capability, Army
    resource processes must be flexible, dynamic, transparent, and
    responsive to both our requirements and those of the joint force. This
    is especially true in today's environment. We are at war against
    conventional and unconventional enemies, and simultaneously pursuing
    transformation. Our resource process must be transformed to allow us to
    keep pace with changes brought on by the enemy. Though we anticipate
    the battle against terrorism will last for years, possibly decades, we
    cannot program and budget in advance for that war. Our Army obviously
    cannot ignore our country's current security needs, yet it would be
    equally imprudent to deviate from the development and fielding of our
    Future Force. Balancing these requirements will be one of our toughest
    tasks.
        The GWOT requires a host of radical paradigm shifts in the way we
    view the face and nature of our global operating environment, as well
    as in the way that we conduct operations. Responsible yet creative
    stewardship of our resources will remain absolutely necessary. Internal
    controls must be tightened and waste eliminated; outsourcing non-core
    functions is still an important option. Risk will continue to be a
    factor and our resourcing decisions must take this into account.
        We must transform our resource processes and adjust our priorities
    to meet the challenge of the current strategic environment. Because we
    cannot mass-produce a volunteer Army, the retention of the right
    volunteer force is an imperative. This force is essential to the combat
    effectiveness of an increasingly complex and technologically
    sophisticated Army. We must refine and streamline the resource,
    acquisition, and fielding processes for equipment and supplies, as we
    cannot make up for lost time in a crisis.
    Accelerated Acquisition and Fielding
        We have adapted and continue to improve our acquisition and
    fielding processes. In 2002, as soldiers reported equipment shortages
    in Afghanistan and elsewhere, we implemented the Rapid Fielding
    Initiative (RFI) to ensure that all of our troops deploy with the
    latest available equipment. Equipment fielding schedules were revised
    to support unit rotation plans, and procurement and fielding cycles
    were radically compressed.
        In coordination with field commanders and our soldiers, a list of
    more than 40 mission-essential items, including the Advanced Combat
    Helmet, close-combat optics, Global Positioning System receivers,
    soldier intercoms and hydration systems, was identified for rapid
    fielding. Laying the foundation for acquisition transformation, RFI
    already has equipped nine BCTs. In fiscal year 2004, RFI will upgrade a
    minimum of 18 BCTs and 8 ESBs, serving in OIF and OEF. Additionally, we
    are accelerating fielding of select future capabilities to our current
    force. These items include thermal weapon sights, enhanced night vision
    goggles, improved body armor, the Future Combat Rifle, and a new sniper
    rifle. Congressional support for regular budget and supplemental
    spending requests enables our Army to put this improved equipment in
    the hands of our soldiers.
        With this support, our Army also has instituted a Rapid Equipping
    Force (REF) that works directly with operational commanders to find
    solutions to operational requirements. These solutions may be off-the-
    shelf or near-term developmental items that can be made quickly
    available. For example, the REF established a coordinated effort to
    supply U.S. forces with immediate solutions to counter improvised
    explosive device (IED) threats. Currently, IED teams are on location
    providing expertise and material solutions, to safeguard our soldiers.
    We are acting aggressively to improve the armor protection of our
    armored and light-skinned vehicles. Other recent examples of REF
    products are the Well-Cam and PackBots. The Well-Cam is a camera
    attached to an Ethernet cable and a laptop that enabled soldiers in
    Afghanistan to search wells for weapons caches. PackBots are
    operational robots used to clear caves, buildings, and compounds so
    soldiers are not unnecessarily put in harm's way.
        RFI and REF provide timely support to our relevant and ready forces
    and to the combatant commanders, and facilitate Army transformation.
    Balancing our Active and Reserve Component Force Structure
        Currently, neither our active nor Reserve component is optimized
    for today's rapid deployability requirements. We will continue ongoing
    efforts to restructure our forces in order to mitigate stress; to align
    better with the current and projected security environments; and to
    offer campaign-quality land power capabilities to the combatant
    commanders. By doing so, we will ensure that our Army provides the
    responsiveness and depth required to achieve strategic and operational
    objectives, while simultaneously defending our homeland.
        Our Army is restructuring and rebalancing more than 100,000
    positions in our active and Reserve component force structure. These
    conversions increase the active component capabilities available to
    support the first 30 days of a rapid response operation. In response to
    Secretary of Defense guidance, we have already completed approximately
    10,000 positions. For example, the ARNG provisionally organized 18
    additional military police (MP) companies. Between fiscal year 2004 and
    fiscal year 2009, our Army will divest approximately 19,500 positions
    of less frequently used active and Reserve component force structure to
    further resource critical high demand units such as military police,
    civil affairs, and Special Operations Forces. We project that future
    rebalancing efforts will convert an additional 80,000 positions of
    lower-priority force structure. Despite these changes, our Army will
    remain stressed to meet anticipated requirements. To ensure that our
    Army can fulfill its commitment to our Nation, we should have the force
    capability level required to facilitate rebalancing, resetting,
    restructuring, and transforming of the Army.
        Military-to-civilian conversions are another way to improve
    manpower efficiency. More military personnel will fill the operational
    force if they are moved out of positions that can be prudently
    performed by civilians. To improve the Army's ability to better support
    worldwide commitments, it is essential to start this process now.
        Our Reserve component relies heavily on full-time support (FTS)
    personnel to sustain support of current contingencies while
    restructuring the force. FTS personnel perform the vital, day-to-day
    organizational, administrative, training and maintenance activities
    that ensure the highest level of soldier and unit readiness. To
    guarantee that our Army's Reserve component will continue to fulfill
    ever-increasing demands with trained and ready units, our Army plans to
    raise FTS authorizations by 15 percent, from the current level of
    71,928 to 85,840, by fiscal year 2012. In 2003, the Army Reserve began
    implementation of the Federal Reserve Restructuring Initiative. The
    goal is to better meet contingency requirements and to improve unit
    readiness.
    Achieving Greater Combat Capability with Modular, Capabilities-Based
            Unit Designs
        Modular units are interchangeable, scalable, and tailorable
    formations, which provide the Joint Force Commander with a
    strategically responsive force that greatly increases his ability to
    defeat any adversary. Modularity enables us to tailor our capabilities
    to the requirements of the situation and delivered at the right time
    and the right place. Modularity permits the combatant commander to
    optimize his warfighting tool set.
        Moving toward independent, echelon-above-brigade headquarters will
    enhance modularity. In accordance with our unit of employment (UE)
    construct, a UE will provide the command-and-control structure into
    which modular, capabilities-based units of action (UA) are organized to
    meet combatant commander requirements. These UAs will incorporate
    essential maintenance, intelligence, and communications functions
    previously provided by higher-level organizations. Our UE headquarters,
    while able to accept joint capabilities such as a standing joint force
    headquarters element, will have an organic capability, depending on the
    contingency, to function as a joint task force or joint force land
    component command headquarters like we have already done in Afghanistan
    and Iraq.
    Force Stabilization
        The great demands placed on our Army have forced us to re-examine
    many of our long-standing personnel and basing practices. As a result,
    our Army is transitioning to an improved manning system, designed to
    augment unit readiness by increasing stability and predictability for
    commanders, soldiers, and families. Force Stabilization will allow
    Reserve component soldiers to plan for their deployments while
    supporting their civilian jobs and their community commitments. It
    places greater emphasis on building and sustaining cohesive,
    deployable, combat-ready forces for combatant commanders.
        The home-basing initiative keeps our soldiers in their assignments
    at specific installations longer, thus reducing unit turbulence and
    increasing unit cohesion. Unit focused stability synchronizes our
    soldiers' assignments to their units' operational cycle, providing a
    more capable, deployable, and prepared unit.
    Installations as Our Flagships
        Our installations are an essential component in maintaining the
    premier Army in the world. For the warfighter, installations are the
    platforms from which we project military power. Our installations
    perform the following key missions: (1) provide effective training
    facilities; (2) rapidly mobilize and deploy the force; (3) provide
    reachback capabilities; (4) sustain and reconstitute the force; and (5)
    care for our families. As power projection platforms, our installations
    must be equipped with a robust information infrastructure that gives
    the deployed commander quick and efficient reach-back capabilities. All
    of these missions help to maintain our Army's deploy ability and
    fighting edge.
        Historically, we have accepted risk in our infrastructure and
    installation services in order to maintain our current readiness. The
    cumulative effect on our installations is that commanders rate more
    than 50 percent of our facilities as ``adversely affecting mission and
    training requirements.'' We have adjusted our management processes to
    be more effective stewards of our resources. In 2002, we established
    the Installation Management Agency (IMA) to create a corporate-focused
    structure that provides efficient installation management worldwide.
    The IMA uses creative management programs to sustain quality
    installations and maintain the well-being of the entire Army family.
        The Installation Information Infrastructure Modernization Program
    (I3MP) enhances the installation's role in power projection and
    provides the architecture to address the essential reach-back
    requirement. Additionally, our Installation Sustainability Plan
    addresses ways to fulfill environmental requirements without impacting
    current or future training. Other important progress include
    modernization of barracks and housing; a Residential Communities
    Initiative; and divestiture of redundant facilities infrastructure and
    non-core utility systems through privatization.
        In the past few years, the administration and Congress have helped
    us to begin addressing our infrastructure challenges. We requested 94
    percent of funding required for sustainment of our installations in
    fiscal year 2004. We have made progress in improving our installations
    by adjusting existing programs and developing new management
    strategies. However, there is much still left to do in order to upgrade
    our installations to better support the mission, soldiers, and our
    families.
    Army Families and Well Being
        People are the heart and soul of the Army--soldiers, civilians,
    family members, and retirees. Our readiness is inextricably linked to
    the well being of our people. The Army family, for both the active and
    Reserve component, is a force multiplier and provides the foundation to
    sustain our warrior culture. We have placed significant emphasis on our
    Reserve component this year in recognition of their contributions to
    the global war on terrorism. With the help of the administration and
    Congress, many improvements have been made including the retention and
    increase of Imminent Danger Pay, Family Separation Allowance, and a
    sizable pay raise. Other key well-being initiatives include the Spousal
    Employment Partnership, new TRICARE policies for the Reserve
    components, and improvements in barracks and family housing. For more
    information on other Army well-being initiatives, see Addendum D
    (available at www.Army.mil)
    Introducing New Capabilities into Current Force
        While at war, the urgency to accelerate the development and
    fielding of new and enhanced capabilities to our fighting forces in the
    field has never been greater. Our Army is making significant strides in
    this regard with the employment of a new brigade combat team
    organization, equipped with the latest available technology, to provide
    the combatant commander with enhanced warfighting capabilities. The
    rapid fielding of the Stryker vehicle demonstrates our Army's ability
    to use the acquisition and resource processes to meet a combatant
    commander's urgent needs.
        Stryker Brigade Combat Team (SBCT)
        In 2003, our Army deployed our first SBCT, the 3rd Brigade, 2nd
    Infantry Division, to Operation Iraqi Freedom, delivering its enhanced
    capability to the joint force in record time: 4 years from broad
    concept to deployment. Exceptional support from Congress and the Office
    of the Secretary of Defense, along with close collaboration between the
    Army and industry, made this achievement possible.
        Stryker brigades are our Army's first truly network-centric force,
    filling the capability gap between light- and heavy-force units with
    infantry-rich, mobile force that is strategically responsive,
    tactically agile, and more lethal. Improved battlespace awareness and
    battle-command technologies embedded in our SBCTs enhance combat
    effectiveness and survivability by integrating data from manned and
    unmanned air and ground-based sensors and providing real-time,
    continuous situational understanding. Planned enhancements will
    incorporate still-developing technologies. Significantly, our SBCTs
    will improve our Army's understanding of future force processes,
    helping us to formulate an advanced warfighting doctrine that will
    serve as an important bridge to the development of our unit of action,
    the structural foundation of our future force.
        This spring, our second SECT at Fort Lewis, Washington, will become
    operational. Our third SECT, in Alaska, will be available in 2005.
    Continued OSD and congressional support will ensure that subsequent
    brigades in Hawaii, Louisiana, and Pennsylvania, are fielded between
    2004 and 2008.
        Future Capabilities
        Our Army plans to field a number of systems this decade that will
    provide a foundation for informing the transformation of our current
    force capabilities into those needed by our future force. Once fielded,
    these systems will perform as interdependent systems of systems and
    will greatly enhance joint warfighting capabilities. Our future
    capabilities programs are designed to enhance the campaign-quality
    land-power capabilities that we provide to the combatant commanders.
    Our programs undergo continuous reviews to ensure they meet the
    capability requirements of the joint force. When required, we
    restructure programs, revise requirements and reprogram resources. The
    following are just a few of the key transformational systems our Army
    will begin to field during the next 6 years:
        The Network. Our future force situational dominance will depend
    upon a comprehensive, ubiquitous, and joint-interoperable command,
    control, communications, computers, intelligence, surveillance, and
    reconnaissance (C\4\ISR) architecture (the Network) that enables the
    Joint Force Commander to conduct fully interdependent and network-
    centric warfare. The network will provide the backbone of our future
    force and the future joint force, enabling the maneuver commander to
    effectively coordinate battlefield effects. Some of the more important
    systems within our network include:

             Warfighter Information Network--Tactical (WIN-T). WIN-
            T will be the communications network of our future force,
            optimized for offensive and joint operations, while providing
            the combatant commander the capability to perform multiple
            missions simultaneously.
             Joint Tactical Radio System (JTRS). JTRS is a family
            of common, software-defined, programmable radios that will
            become our Army's primary tactical radio for mobile
            communications.
             Distributed Common Ground System--Army (DCGS-A). DCGS-
            A is a single, integrated, ground-based, ISR processing system
            composed of joint, common hardware and software components and
            is part of the DOD DCGS family of systems.
             Aerial Common Sensor (ACS). This ISR system and
            platform will use robust sensor-to-shooter and reach links,
            (such as DCGS-A ground stations), to provide commanders at
            every echelon the tailored, multi-sensor intelligence required
            for joint operations.

        Future Combat Systems (FCS). By extending the network capabilities
    into the unit of action, the FCS provide a system of systems capability
    that was not previously available to soldiers and commanders in joint
    operations. The core of our future force's maneuver unit of action is
    the Future Combat Systems, comprised of 18 manned and unmanned
    platforms that are centered around the soldier and integrated within a
    C\4\ISR network. FCS will provide our soldiers greatly enhanced
    situational awareness, enabling them to see first, understand first,
    act first, and finish decisively. Our FCS platforms will offer the
    joint force networked, lethal direct fire; indirect fire; air defense;
    complementary non-lethal fires and effects; and troop transport
    capability. In May 2003, FCS moved, on schedule, into the system
    development and demonstration phase. Our Army is aggressively managing
    our FCS development effort and intends to achieve initial operational
    capability by the end of the decade.
        Army Science and Technology
        The Army Science and Technology (S&T) program provides our Army
    superiority in both human and materiel systems arenas--preventing
    technological surprise. The Army S&T program retains a dynamic
    portfolio of investments that are responsive to warfighter needs today
    and into the future. The priority for Army S&T is to pursue paradigm-
    shifting technologies that can alter the nature of the military
    competition to our advantage in the future and, where feasible, to
    exploit opportunities to accelerate the transition of proven
    technologies to our current force.
        The Army S&T program exploits technology developments from the
    other services, defense agencies, and commercial industry as well as
    international communities. The S&T program focuses on technology
    relevant to our Army and joint capabilities. It synchronizes
    operational concepts development and acquisition programs through
    transformational business practices that speed technology fielding to
    the soldier. The Army's S&T program is balanced to satisfy the high
    payoff needs of the future force while seeking rapid transitions for
    critical capabilities to our current force.
    Joint Operational Concepts (JOpsC)
        The joint force has transitioned from independent, de-conflicted
    operations to sustained interoperability. It must now shift rapidly to
    joint interdependence. To that end, we are reviewing training
    requirements, traditional relationships and developmental and
    institutional programs. This process includes ensuring that our
    operational concepts are nested inside those employed by the joint
    force. The concepts and initiatives listed below discuss particular
    Army emphasis areas; these areas are not all-inclusive. Functional
    concepts and other Army initiatives that support the JOpsC are
    discussed in detail in Addendum J (available at www.Army.mil).
        Actionable Intelligence
        Our Army also is focused on attaining actionable intelligence--
    intelligence that provides situational understanding to commanders and
    soldiers with the speed, accuracy, and confidence necessary to
    influence favorably current and future operations. Actionable
    intelligence achieves its intended purpose of empowering greater
    individual initiative and self-synchronization among tactical units by
    fusing information across organizations and echelons--accelerating the
    speed of decisionmaking and the agility of operations.
        Focused Logistics
        Our Army's current actions around the world in support of the
    global war on terrorism present a view of future military operations
    and provide valuable insights as we transform our logistics systems
    from the current to the future force. The successes enjoyed during OIF
    were the result of the integrated logistics team of soldiers,
    civilians, and contractors, all of who developed innovative solutions
    to a range of challenges caused by four major capability gaps in the
    current logistics system. To sustain combat power, our Army must have
    the ability to ``see the requirements'' on-demand through a logistics
    data network. We require a responsive distribution system, enabled by
    in-transit and total-asset visibility and managed by a single owner who
    has positive end-to-end control in the theater. Our Army needs a
    robust, modular, force-reception capability--a dedicated and trained
    organization able to quickly open a theater and support continuous
    sustainment throughout the joint operations area. Lastly, we need an
    integrated supply chain that has a single proponent, who can reach
    across the breadth and depth of resources in a joint, interagency, and
    multinational theater. As we move from the current force to the future
    force, we will build confidence in the minds of the combatant
    commanders by delivering sustainment on time, every time.
                           a commitment to our nation
        Our Nation and our Army are engaged in a global war on terrorism--a
    war of survival against an insidious and cruel enemy that threatens our
    civilization and our way of life. This enemy is actively targeting the
    interests of America and our allies, both within our own country and
    abroad.
        Defeating this enemy require the continued, strong support of our
    Nation. The steadfastness of our Nation in this effort is readily
    apparent. Ordinary Americans are doing their part and will continue to
    do so. Congressional support for our troops has been critical to our
    success. The industrial base also has responded, accelerating
    production of items essential to our soldiers' protection and
    warfighting ability.
        Our Army, too, remains committed to its heritage of preserving
    freedom. American soldiers display unrelenting tenacity, steadfast
    purpose, quiet confidence, and selfless heroism. For America to survive
    and flourish throughout the 21st century, our Army must defeat
    decisively the threats that challenge us today. To accomplish this
    essential task, we must recognize some important truths.

             The fight against terror will be a long one
             Our Army must simultaneously deter aggression, defeat
            the forces of international terrorism, and maintain our
            campaign qualities
             We must continue to modernize to meet the challenges
            of our future
             Our operational tempo is high and will remain so
             Sustained operations and deployments will be the norm
            for our soldiers--NOT the exception
             Old rules and operational methods may no longer apply;
            we will not achieve victory with a business-as-usual approach

        Congressional backing for reset, our continued transformation to
    the future force, our rebalancing and restructuring of the active and
    Reserve component, and improvements to our installation infrastructure
    is essential to continued mission readiness. We fully appreciate the
    exceptional support members and their staffs provided this past year.
    The support of the American people and their elected representatives in
    the United States Congress is essential.
        Our Army's commitment to the future is certain. We will continue to
    provide our Nation, the President, the Secretary of Defense, and the
    combatant commanders a unique set of core competencies and
    capabilities. We remain dedicated to training and equipping our
    soldiers and growing leaders. We will continue to deliver relevant and
    ready land power to the combatant commanders and the joint force. We
    will protect our country and our way of life as we have for 228 years.
    It is our privilege, our duty, and our honor to do so.

        Senator Inhofe. Thank you, Secretary Brownlee, for an
    excellent opening statement.
        Secretary England.

       STATEMENT OF HON. GORDON R. ENGLAND, SECRETARY OF THE NAVY

        Secretary England. Senator, thank you very much. I know
    time is short, so I'll keep my remarks also very short.
        First, I do want to thank the committee for confirming me
    the second time and allowing me to come back to have this great
    privilege and honor, of course to appear before this committee,
    but to serve our men and women in uniform, our sailors and
    marines. They are absolutely magnificent. I am convinced this
    is the finest naval force the world has ever seen, and I thank
    this committee for your great support, because without your
    support we would not have the ability that we have to defend
    freedom and liberty that we all so cherish in this country. So
    I thank you.
        I am pleased to report that the naval forces we are
    deploying today and that we plan to deploy for the future,
    which is contained in our fiscal year 2005 budget request, are
    vastly different, and they're also vastly better than what I
    reported during my first committee discussion here about 2
    years ago. I can tell you that naval transformation is well
    underway. It is reflected in our budget, and it is crucially
    important as we move forward into the future. So I would
    appreciate your support.
        I do want you to know that the Chief of Naval Operations
    (CNO), the Commandant, and myself are committed to being very
    effective and also very efficient. So you will see, in this
    budget, a continuation of the past 2 years, where we have
    continued to move money from what I call the ``back end of the
    business'' into our weapon systems. We continue to be more
    effective. We work very hard to be good stewards of our
    citizens' money, and we continue that, and you will see that
    reflected in the 2005 budget.
        I do want to comment that people are, indeed, our most
    important asset. While we have a lot of requests in the budget,
    in terms of weapon systems, people are our most important
    asset. We are a strong, well-trained, and highly-motivated
    combat-ready force. I would like you to know that retention
    across the Department of the Navy is at record levels. So we
    are retaining our people, they want to serve in our naval
    forces, they want to serve our country, and our recruiting
    continues to be robust. We have the very best people, our
    morale is very high, and they are pleased to deploy, and defend
    and protect this great Nation.
        As I sit here today, the naval forces continue to
    demonstrate their value to our Nation. We are today redeploying
    our marines to Iraq, also our naval forces, as part of
    Operation Iraqi Freedom II. Of course, with what's happened in
    the last few days, our Marine Forces are now also in Haiti. The
    Navy-Marine Corps team is a force in readiness. We are
    prepared, at any time, to support our Nation, whenever,
    wherever.
        So ladies and gentlemen of this very important committee,
    I, again, thank you for the opportunity to be here. I thank you
    earnestly for the opportunity to again serve my Nation as the
    Secretary of the Navy. Our sailors, our marines, and their
    families are proud to serve this Nation, and I am privileged
    and proud to serve them. I'm also privileged and proud to serve
    with the other secretaries here today, and specifically with
    our great CNO and our magnificent commandant.
        So it's a pleasure being with you today. Thank you for your
    support, and I do look forward to your questions and
    discussion.
        Thank you very much.
        [The prepared statement of Secretary England follows:]
                  Prepared Statement by Hon. Gordon R. England
                value to our nation--the navy/marine corps team
    I. Introduction
        During my last appearance before this committee in February 2002
    and as reported in that statement, the Navy and Marine Corps
    contributions in the ``War Against Terrorism'' have been significant
    and important in the overall success of U.S. military forces. This
    continues to hold true today. Our Navy and Marine Corps team projects
    decisive, persistent, joint power across the globe, in continuing to
    prosecute the war on terrorism.
        Projecting power and influence from the sea is the enduring and
    unique contribution of the Navy and Marine Corps to national security.
    Operation Iraqi Freedom (OIF) demonstrated the strategic agility and
    operational flexibility that forward deployed naval expeditionary
    forces provide. This committee's support has been vital for the Navy
    and Marine Corps team to exploit the access afforded by the seas and to
    respond to the full spectrum of contingencies. Congressional support
    has led to increased readiness which was proven in OIF, where dispersed
    military forces networked together fought as a single, highly
    coordinated joint team.
        Naval warfare will continue its progression to operate in a joint
    environment in responding to new threats and to the increased
    asymmetric capabilities of our enemies. We will be bold and continue to
    develop new capabilities and concepts, and fund them in quantities that
    are relevant to tomorrow's emerging threats. We have embraced
    transformation. We are addressing the challenge to operationalize our
    vision, Naval Power 21, with technological, organizational, and
    doctrinal transformation.
        The following statement highlights key elements of the fiscal year
    2005 President's budget applicable to the Department of the Navy (DON)
    within the balanced scorecard approach of managing operational,
    institutional, force management, and future challenges risks.
    II. Fiscal Year 2005 Budget Priorities--Underway with Naval Power 21.
        The fiscal year 2005 Department of the Navy budget fulfills our
    essential warfighting requirements. We are resourced to fight and win
    our Nation's wars and our number one priority, the war against
    terrorism, is reflected across each allocation. Additionally, we
    continue to invest in future technologies and capabilities that are
    part of a broader joint warfighting perspective. The Navy and Marine
    Corps are continuously working with other Services to draw on the
    capabilities of each Service, to eliminate redundancy in acquisition,
    and create higher levels of military effectiveness. A prime example is
    our agreement with the Department of the Air Force to merge our two
    Joint Tactical Radio System (JTRS) programs into a single program that
    will produce a common family of radios for use aboard our ships,
    submarines, and aircraft. The following summarizes the fiscal year 2005
    budget request priorities for the Department of the Navy:
        Personnel Salary and Benefits
        Smart, motivated, and capable people are a key element to any
    successful transformation effort. Our Navy and Marine Corps are
    increasingly a technologically advanced maritime force and we are in
    competition with the private sector to attract and retain the best men
    and women we can find. Accordingly, our budget includes a 3.5 percent
    basic pay raise for all military personnel. Additionally, housing
    allowances have been increased to buy down out-of-pocket housing
    expenses for our military personnel. Concurrent with this commitment to
    provide an appropriate level of pay and benefits to our sailors,
    marines, and their families is a responsibility to operate this
    Department as efficiently and effectively as possible. While we want
    the best people we can get to serve in the Navy and Marine Corps, we
    don't want a single person more than we need to properly operate the
    force. Job satisfaction comes not only just from compensation, but also
    from meaningful service--we owe it to our people to ensure that they
    are given duties and equipment appropriate to a volunteer force.
        Operations and Maintenance
        The operations and maintenance accounts are funded with over a $2
    billion increase. The present environment requires naval forces to be
    both forward deployed and capable of surging when called. This account
    will help develop the transformational Fleet Response Plan (FRP). This
    is the means to institutionalize the capability to maintain a more
    responsive force that is ready to surge, more efficient to maintain,
    and able to reconstitute rapidly.
        Shipbuilding Account
        The Department's shipbuilding plan supports our transformational
    vision and increases the number of new construction ships from seven in
    fiscal year 2004 to nine in fiscal year 2005 plus one SSBN Engineered
    Refueling Overhaul (ERO). Initial LCS and DD(X) platforms are funded
    from the RDT&E account. Additionally, the Navy's fiscal year 2005
    spending plan completes the purchases of the last 3 DDG-51 class ships
    for a total of 62 ships.
        Aviation Account
        The Department's fiscal year 2005 budget request is structured to
    maintain the continued aviation superiority of the Navy and Marine
    Corps. The naval aircraft procurement plan emphasizes replacing costly
    stand-alone legacy platforms with more efficient and capable integrated
    systems. The number of aircraft requested increases from 99 in fiscal
    year 2004 to 104 in fiscal year 2005 which includes 5 VXX helicopters.
    The budget continues to maximize the return on procurement dollars,
    primarily through the use of multi-year procurement (MYP) for the F/A-
    18E/F, the E-2C, the MH-60S, and the KC-130J programs. Development
    funding is provided for Joint Strike Fighter (JSF), MV-22, AH-1Z/UH-1Y,
    CH-53X, EA-18G, and the Multi-mission Maritime Aircraft (MMA). The
    budget reflects an amended acquisition strategy for the V-22 to fund
    interoperability issues and cost reduction initiatives.
        Munitions Account
        During OEF and OIF, the Department expended less precision ordnance
    than projected. In this environment, the precision munitions purchases
    for fiscal year 2005 have been decreased for JDAMs and LGBs. This
    decrease in procurement provides no increased risk to the DON but
    merely reflects the lower utilization rates of expended ordnance.
        RDT&E Account
        An increase of $1.4 billion reflects our commitment to future
    transformational capabilities and technology insertion for major
    platforms including DD(X), LCS, CVN-21, V-22, Joint Strike Fighter
    (JSF), Advanced Hawkeye (AHE), and MMA. As demonstrated in recent
    operations, our naval forces have been able to project overwhelming
    combat power because they are technologically superior. We continue to
    sustain a robust RDT&E effort as we transform the Navy and Marine Corps
    to the next generation of combat systems.
        Effectiveness and Efficiency
        A guiding principle in all we do is improving effectiveness to gain
    efficiency. The very best organizations are the most efficient
    organizations. If you are very efficient, you incorporate technology
    more quickly, you can develop new systems and capabilities, and you can
    bring them on line faster. Underlying all of the previous accounts and
    our execution of them is a continuing and concerted focus to achieve
    the most efficient organization. The Fleet Response Plan, TacAir
    Integration, and establishment of the Commander Naval Installations are
    a few of our initiatives to improve effectiveness within the
    Department.
        Our objective for the fiscal year 2005 budget request is to move
    forward with Naval Power 21. This budget builds upon the foundation
    laid in the fiscal year 2004 program and reaffirms our commitment to
    remain globally engaged today while developing future technology to
    ensure our future military superiority. We are also continuing to
    emphasize the Department's commitment in the areas of combat
    capability, people, technology insertion and improved business
    practices. With our fiscal year 2005 budget request we are committed to
    executing this vision.
    III. Calendar Year 2003 Operational Successes (A Nation at war)
        The extraordinary capability of our joint forces to project power
    around the world in support of vital national objectives was
    demonstrated over the last year. The maritime contribution to our
    success in the defeat of Saddam Hussein's Baathist forces, as well as
    in support of other joint engagements in the global war on terrorism,
    was significant. The rapid deployment and the warfighting capability of
    your naval force in the liberation of Iraq provided an example of the
    importance of readiness and the responsive capabilities to support our
    Nation's objectives in an era of unpredictability and uncertainty. The
    demonstrated importance of our multi-dimensional naval dominance, our
    expeditionary nature, our ability to deal with complex challenges, and
    adaptability of our forces are illustrative of the high level of return
    on investment of your naval force.
        The accomplishments of this past year tell the naval forces
    readiness story and its return on investment. The ships, aircraft,
    weapon systems, and readiness you funded provided our sailors and
    marines the tools necessary to remain the premiere maritime and
    expeditionary combat ready force. In preparing for and conducting
    operations in the Iraq theater, speed of expeditionary operations and
    sustainment were important military competencies. Naval forces applied
    dominant, persistent, decisive, and lethal offensive power in support
    of coalition warfighting objectives. The speed, agility, flexibility,
    and persistence of naval combat capability helped end a regime of
    terror and liberate a people during OIF.
        The past year has been one of significant accomplishment. Our men
    and women operating in the air, on and under the sea, and on the ground
    are at the leading edge in the global war on terrorism. As in OEF, we
    once again have demonstrated naval forces' unique value in contributing
    to the security of our Nation and our friends and allies.

             During OIF, more than 50 percent of our force was
            forward deployed. The deployment of seven Carrier Strike Groups
            (CSGs) and eight large deck amphibious ships proved our ability
            to be both a surge and a rotational force demonstrating our
            flexibility and responsiveness.
             Navy and Marine Corps aircraft flew more than 8,000
            sorties and delivered nearly 9,000 precision-guided munitions.
             Over 800 Tomahawk cruise missiles were fired from 35
            coalition ships, one-third of which were launched from
            submarines. The highest number of TLAMs launched in 1 day
            occurred on March 21, 2003--nearly 400 Tomahawks.
             Navy Special Forces, MCM, Explosive Ordnance Disposal
            (EOD), and coalition counterparts cleared more than 900 square
            miles of water, ensuring the safe passage of critical
            humanitarian relief supplies to the Iraqi people.
             Marines from the I Marine Expeditionary Force (I MEF),
            supported by Sea Basing concepts, made one of the swiftest
            combat advances in history. They fought 10 major engagements,
            destroying 9 Iraqi divisions in the 450 mile advance into Iraq.
             Eleven Maritime Prepositioned Force (MPF) ships
            provided equipment and sustainment for over 34,000 marines and
            sailors and 14 amphibious ships embarked and delivered another
            12,000 marines and sailors and their equipment.

        Since the end of major combat operations, naval forces have been
    instrumental in supporting the coalition's goals of security,
    prosperity and democracy in Iraq. Coalition maritime forces have
    diligently supported the United Nations Security Council Resolution
    1483. They have queried over 6,000 vessels, boarded close to 3,500 and
    diverted approximately 430. These forces have confiscated and returned
    to the Iraqi people approximately 60,000 barrels of fuel. Additionally,
    seaward protection of the Al Basara Oil Terminal (ABOT) is enabling the
    generation of critically needed oil revenue. Since re-opening, the ABOT
    has pumped 261,500,000 barrels of oil valued at over $7.5 billion.
        Navy Seabees and Marine Engineers, as the I MEF Engineer Group,
    undertook construction initiatives that built and repaired major
    roadways and bridges, and completed major utility restoration projects.
    In all, 150 projects valued at $7.1 million were completed.
        Naval EOD forces are working with Army counterparts in support of
    the coalition forces and Iraqi Police and are collecting over 2,000
    pounds of unexploded ordnance per week.
              iv. navy and marine corps today (current readiness)
        Today's naval forces exist to control the seas, assure access, and
    project power beyond the sea to influence events and advance American
    interests. Navy and Marine Corps forces continue to lead the way to
    secure the peace by responding with speed, agility, and flexibility.
    The value of naval forces continues to be demonstrated through the
    projection of decisive, persistent, joint power across the globe. The
    investment in training, maintenance, parts, ordnance, flying hours,
    steaming days, and combat ready days coupled with our forward presence
    and our ability to surge has positioned naval forces as the most
    effective and efficient military force.
        Congress' investment in readiness over the past several years has
    paid large dividends for naval forces during OIF. With combat forces
    operating in two fronts in the GWOT our readiness investments have
    resulted in enhanced naval forces ready to strike on a moment's notice,
    anywhere, anytime. Our success in deploying 9 out of 12 aircraft
    carriers and 10 out of 12 big deck amphibious ships to major combat
    areas of operation in demanding environments is attributable to the
    continued improvements in current readiness.
        The Department is in the process of re-deploying Navy and Marine
    Forces in preparation for Operation Iraqi Freedom II. Navy and Marine
    Forces will deploy in two 7-month rotations with the first beginning
    this month. This initial ground rotation will include about 25,000
    marines, 3,500 marine reservists, over 5,000 active duty Navy, and 800
    naval reservists.
        Since the return of our forces from OIF we have invested heavily in
    constituting the Navy and Marine Corps team for the next fight.
    Continued successful programmed investment will ensure we have the most
    capable forces to face the unique challenges ahead. The fiscal year
    2005 budget continues a broad range of modernization and readiness
    initiatives for naval forces.
    Acquisition Programs
        The Fleet and Marine Forces continue to take delivery of the most
    sophisticated weapon systems in the world. In 2003, the Navy launched
    the first of two new classes of ships, U.S.S. Virginia (SSN 774) and
    U.S.S. San Antonio (LPD 17), commissioned the aircraft carrier U.S.S.
    Ronald Reagan (CVN 76), and continued timely delivery of the Arleigh
    Burke class guided missile destroyers and F/A-18 E/F Super Hornets.
        We are continuing to build on previous budgets to ensure we equip
    and train our forces to help us continue to meet the challenges of the
    future. What the DON budget will buy to advance our vision in Naval
    Power 21:
        Shipbuilding
        The fiscal year 2005 to fiscal year 2009 shipbuilding rate of 9.6
    battle force ships per year is up from 8.4 battle force ships per year
    for the same period in fiscal year 2004. The fiscal year 2005 budget
    request closes the procurement gap and with the exception of a slight
    reduction in fiscal year 2006, provides an upward trend through the
    FYDP, procuring 17 battle force ships by fiscal year 2009. The fiscal
    year 2005 to fiscal year 2009 investment is an average of $13 billion
    per year in new construction. The fiscal year 2005 to fiscal year 2009
    plan also procures three Maritime Pre-positioned Force (Future) (MPF
    (F)) ships and a MPF (F) aviation variant. While our build rate drops
    to six in fiscal year 2006, this is a reflection of a shift to the next
    generation surface combatants and sea basing capabilities.
        The Navy has nine new ships and one SSBN refueling requested in the
    fiscal year 2005 budget, as well as substantial shipyard/conversion
    work. This investment includes:

             Three DDGs ($3.4 billion)
             One Virginia class submarine SSN-774 ($2.5 billion)
             One LPD-17 ($967 million)
             Two T-AKE ($768 million)
             One DD (X) ($221 million) (RDT&E funded)
             One Littoral Combat Ship (LCS) ($108 million) (RDT&E
            funded)
             One SSBN conversion/refueling ($334 million)

        Fiscal year 2005 marks the final year of DDG 51 procurement,
    bringing to closure a 10-ship fiscal year 2002 to fiscal year 2005 MYP
    contract awarded in fiscal year 2002. The Navy will move to the DD(X)
    and LCS hulls as quickly as possible. In addition to vitally needed new
    capability, these ships will increase future shipbuilding rates.
    Investment in these platforms will also help maintain critical
    industrial bases.
        The Department is modernizing its existing submarine with the
    latest technology while, at the same time, continuing to replace aging
    fast attack submarines with the new Virginia class submarine. The
    Virginia class design is complete and the lead ship (SSN 774), will
    commission on schedule. Fiscal year 2004 funded the first of five
    Virginia class submarines under a MYP contract. The second submarine of
    the MYP contract is funded in fiscal year 2005. Consistent with
    congressional approval of 5 year-five ship MYP authority (fiscal year
    2004 to fiscal year 2008) for SSN 774, the Navy is maintaining one
    submarine per year through fiscal year 2008.
        The DON accelerated one LPD from fiscal year 2006 to fiscal year
    2005 leveraging fiscal year 2004 advanced procurement resources
    provided by Congress. The lead ship detail design has been completed
    and lead ship construction is over 80 percent complete with a
    successful launch in July 2003. Production effort is focused on a
    November delivery. The LPD 17 class ship represents our commitment to a
    modernized expeditionary fleet.
        The fiscal year 2005 budget request also provides for procurement
    of two auxiliary cargo and ammunition ships (T-AKEs) in the National
    Defense Sealift Fund. These will be the seventh and eighth ships of the
    class. Lastly, the fiscal year 2005 budget request accelerates the lead
    MPF (F) from fiscal year 2008 to fiscal year 2007 to reflect an
    emphasis on sea basing capabilities.
        DD(X) is a centerpiece to the transformational 21st century Navy
    and will play a key role in the Naval Power 21 strategic concept. This
    advanced warship will provide credible forward naval presence while
    operating independently or as an integral part of naval expeditionary
    forces. The DD(X) lead ship design and initial construction contract
    will be awarded in fiscal year 2005.
        Conversion and Modernization
        The fiscal year 2005 budget request proposes advanced procurement
    funds for the U.S.S. Carl Vinson (CVN 70) Refueling Complex Overhaul
    (RCOH), now scheduled to begin in fiscal year 2006. CVN 70 has
    sufficient reactor fuel for one additional surge deployment.
        Funding for the Ticonderoga class cruiser modernization effort
    began in fiscal year 2004 and continues in fiscal year 2005. The
    cruiser modernization effort will substantially increase the service
    life and capability of CG 47 class ships. The conversion will reduce
    combat system and computer maintenance costs, replace obsolete combat
    systems, and extend mission relevance service life. Fiscal year 2005
    will fund advanced procurement items for the first cruiser
    modernization availability in fiscal year 2006.
        Funding is included in fiscal year 2005 to complete the conversion
    of the third and the overhaul of the fourth hull of four Ohio class
    SSBNs to SSGNs. The SSGN conversion provides a covert conventional
    strike platform capable of carrying up to 154 Tomahawk missiles. The
    fiscal year 2006 budget request will complete the conversion of the
    last SSGN. All four of these transformed platforms will be operational
    by calendar year 2007.
        Aircraft Production
        Consistent with the fiscal year 2004 program, the fiscal year 2005
    budget request reflects continued emphasis on re-capitalizing our aging
    aircraft. Our focused efforts to aggressively ``shore up'' operational
    readiness by providing requisite funding for our Flying Hour Program,
    Ship Depot Maintenance, Ship Operations, and Sustainment, Re-
    capitalization, and Modernization accounts continue. While we continue
    to make substantial investments in readiness accounts and working
    capital accounts, we identified the resources to procure 104 aircraft
    in fiscal year 2005. The Department's aircraft procurement plan
    emphasizes replacing costly legacy platforms with more efficient and
    capable integrated systems. This has resulted in significant
    investments in transformational aircraft and program investments across
    the spectrum of aviation capabilities. Such valuable investments in
    more capable aircraft have allowed a reduction of 40 aircraft from
    fiscal year 2005 to fiscal year 2009.
        During the past year, we continued to enjoy the fruits of our
    aviation investments with the successful first deployment and
    operational employment of the F/A-18 E/F Super Hornet in support of
    OIF. Highly praised for tactical capability and platform reliability,
    the F/A-18 E/F program has been funded to provide a transformational
    radar, helmet mounted sight, advanced targeting pod and integrated
    weapons system improvements. Additionally, we recently awarded a second
    MYP contract that includes the EA-18G airframe to replace the Navy's
    aging EA-6B beginning in fiscal year 2009.
        All helicopter missions continue to be consolidated into the MH-60R
    and MH-60S airframes. These helicopter platforms are the cornerstone of
    Navy helicopter concept of operations designed to support the CSG and
    ESG in various mission areas.
        The Department significantly increases the funding requested for
    MMA. MMA will provide the Navy with strategic blue water and littoral
    capability by re-capitalizing the P-3 Maritime Patrol Aircraft broad
    area anti-submarine, anti-surface, maritime and littoral Intelligence,
    Surveillance, and Reconnaissance (ISR) capability.
        Progress continues towards delivering a high-quality aircraft to
    the Marines and Special Forces including increasing capability and
    interoperability of the aircraft, investing to reduce production costs,
    and maximizing production efficiency. Since the resumption of V-22
    flight-testing, in May 2002, the V-22 is satisfying the threshold
    levels for all its key performance parameters and reliability and
    maintainability measures. V-22 test pilots have recorded more than
    1,100 flight hours since that time. The V-22 program will continue Low
    Rate Initial Production (LRIP) until the Milestone III decision
    expected late calendar year 2005.
        The Department will continue to procure the AH-1Z/UH-1Y. These
    aircraft meet the Marine Corps' attack and utility helicopter
    requirements by providing increased aircraft agility, airspeed, range,
    and mission payload. They provide numerous capability improvements for
    the Marine Corps, including increased payload, range and time on
    station, improved sensors and lethality, and 85 percent component
    commonality. The KC-130J MYP is funded and supported in this budget.
    The advantages include an all digital cockpit that reduce aircrew
    manning requirements, a new propulsion system that provides more cargo
    capability, and increased fuel delivery.
        Mine Warfare Programs
        In keeping with the Department's goal to achieve an organic mine
    warfare capability in 2005, the budget request supports the development
    and procurement of five organic airborne systems integrated into the
    MH-60S helicopter: the AQS-20A Mine-hunting System, the Airborne Laser
    Mine Detection System (ALMDS), the Airborne Mine Neutralization System
    (AMNS), the Rapid Airborne Mine Clearance System (RAMICS), and the
    Organic Airborne and Surface Influence Sweep (OASIS) system. The fiscal
    year 2005 budget request also supports the development and procurement
    of the Remote Minehunting System (RMS) integrated into DDG-51 hulls 91-
    96, and the Long-term Mine Reconnaissance System (LMRS) integrated into
    SSN-688. The ALMDS, AQS-20A, and RMS will reach an initial operating
    capability in fiscal year 2005. The budget request supports the
    transition of assault breaching technologies into acquisition, which
    will provide a capability to detect, avoid, and defeat mines and
    obstacles in the surf and craft landing zones. In fiscal year 2005, we
    will continue with our Surface Mine Countermeasures (MCM) mid-life
    upgrade plan. We have initiated a product improvement program for the
    engines of the MCM-1 Avenger class mine countermeasure ships to enhance
    their reliability and availability. We are upgrading our minesweeping
    capability with new acoustic generators and magnetic sweep cables, and
    have programmed resources to replace our maintenance-intensive mine
    neutralization system (AN/SLQ-48) with an expendable mine
    neutralization system.
        Munitions
        The Standard Missile (SM) program replaces ineffective, obsolete
    inventories with the procurement of more capable SM-2 Block IIIB
    missiles. The Rolling Airframe Missile (RAM) program continues
    procurement of the improved guided missile launching system and the
    upgraded Block I missile, providing an enhanced guidance capability
    along with a helicopter, air and surface mode. In addition to SM and
    RAM, the fiscal year 2005 budget request provides funding to continue
    production of the Evolved Sea Sparrow Missile (ESSM) and will support
    the first Full Rate Production (FRP) contract award of 82 U.S. and 288
    international missiles. We have committed to replenish our precision
    munitions inventories and to do so, we will utilize a 5-year MYP to
    maximize the quantity of Tomahawk missiles procured.
        Marine Corps Expeditionary Capability
        The Expeditionary Fighting Vehicle (EFV), formerly the Advanced
    Amphibious Assault Vehicle (AAAV), will provide surface assault
    elements the requisite operational and tactical mobility to exploit
    opportunities in support of joint operations. The EFV will be capable
    of carrying a reinforced Marine rifle squad at speeds in excess of 20
    nautical miles per hour from over the horizon in sea state three. Once
    ashore, the EFV will provide Marine maneuver units with a world-class
    armored personnel carrier designed to meet the threats of the future.
    Production representative vehicle procurement occurred in fiscal year
    2003 and will deliver in fiscal year 2005. IOC will be released in
    fiscal year 2008 and FOC in 2018.
        Also critical to Marine Corps transformation efforts is the Joint
    Lightweight 155mm Howitzer (LW-155). This system will enter FRP in
    fiscal year 2005, and our budget includes a request for a Joint Marine
    Corps--Army MYP. Another transformational component of the fiscal year
    2005 budget, the High Mobility Artillery Rocket System (HIMARS), will
    continue LRIP delivery.
    Alignment
        The DON is transforming to dramatically reduce operating and
    support costs. Changes will embrace efficiency and result in increased
    effectiveness and a higher readiness standard in concert with the
    overarching goals of the President's management agenda. We have made
    several fleet and shore organizational changes that have shown great
    potential in maximizing the way forces can be employed and supported.
        Fleet Response Plan (FRP)
        FRP provides a model for a new joint presence concept that will
    transform how the U.S. military is employed. It refines maintenance,
    training, and readiness processes in order to increase the number of
    combat ready ships and aircraft throughout the fleet. FRP ensures six
    employable Carrier Strike Groups (CSGs) always are ready to respond to
    a crisis, plus two additional CSGs capable of deploying to the fight
    within 90 days of notification (``6+2''). With the implementation of
    FRP, half of the fleet either could be deployed or postured to surge,
    able to arrive swiftly with the overpowering combat power needed either
    to deter or defeat the hostile intentions of an adversary, or to win
    decisively in combat against a significant enemy.
        TacAir Integration
        The Navy and Marine Corps team embarked on a Tactical Aircraft
    Integration plan that will enhance our core combat capabilities and
    provide a more potent, cohesive, and affordable fighting force. The
    culmination of a long-term effort to an increased level of readiness
    from the resources given to us, TacAir integration seeks to generate a
    greater combat capability from naval TacAir. Through TacAir
    integration, the Department will reduce the number of tactical aircraft
    (JSF and F/A-18) from 1,637 to 1,140 aircraft by 2021. This integration
    will provide increased combat capability forward and is in concert with
    enhanced sea basing concepts. A cornerstone of this plan is the global
    sourcing of the Department's TacAir assets and the funding and
    maintenance of legacy aircraft at the highest level of readiness until
    they are replaced by the JSF and the Super Hornet (F/A-18 E/F).
        Training Resource Strategy (TRS)
        TRS was developed to provide high quality training to our deploying
    combat forces. The training of our high technology force in modern
    warfare has shifted to a network of existing ranges and installations
    stateside. Fully implemented, TRS has resulted in more training
    options, reduced pre-deployment training transit time, and has
    increased productive training days. The U.S.S. Enterprise was the first
    CSG to deploy under the TRS, utilizing six training ranges, each unique
    to the successful completion of her qualification. TRS supports the FRP
    and will quickly respond to surge requirements by delivering and
    bringing to bear a capable fighting force.
        Current and future readiness requirements underscore the continued
    need for realistic training and maximized use of training and testing
    ranges. While we continue to find ways to enhance readiness through
    increased use of information technology and simulation, live training
    on actual ranges and training areas remains critical during the
    essential phases of the training cycle. Maintaining training realism
    and access to these ranges has been of keen concern to our naval
    forces. We continue to balance the need to maintain a ready and capable
    force with the need to be sensitive to environmental and encroachment
    issues.
        For the last 2 years, Congress has addressed critical Navy needs
    regarding encroachment. Readiness-specific changes to the Marine Mammal
    Protection Act (MMPA), Endangered Species Act, and Migratory Bird
    Treaty Act will help the Navy meet training and operational needs. The
    Navy and Marine Corps has and will continue to demonstrate leadership
    in both its military readiness role and as an environmental steward of
    the oceans we sail and the lands we train upon. We are pursuing
    opportunities for acquiring land buffers adjacent to our training
    lands. We are implementing the Integrated Natural Resources Management
    Plans prepared under the Sikes Act to address endangered species
    concerns in lieu of designating critical habitats. We will continue
    operational actions to minimize harm to marine mammals, as we continue
    investments in research into marine mammal biology and behaviors. The
    MMPA is due for reauthorization in this legislative cycle. To maintain
    our military readiness, your support is necessary to retain the proper
    balance between environmental protection and military readiness during
    the reauthorization debate.
        Carrier Strike Group (CSG)/Expeditionary Strike Group (ESG)
        CSG alignment is complete and the first Pacific Fleet Expeditionary
    Strike Group (ESG-1), centered on the U.S.S. Peleliu Amphibious Ready
    Group and the embarked Marines of the 13th Marine Expeditionary Unit
    (Special Operations Capable), is completing an 8-month deployment. The
    Navy deployed an Atlantic Fleet ESG, the U.S.S. Wasp Amphibious Ready
    Group, last month.
        The ESG adds to the ARG/MEU, a robust strike, anti-air, anti-
    surface, and anti-subsurface capability of a cruiser, destroyer,
    frigate and attack submarine and for the first time, the Advanced
    Swimmer Delivery System (ASDS). These combined capabilities give the
    Combatant Commander a wider variety of options and enables independent
    operations in more dynamic environments.
        Vieques/NSRR closure
        The former training ranges on Vieques have been closed and the
    property has been transferred to the Department of the Interior (DOI),
    Fish and Wildlife Service. We have active cleanup and range clearance
    programs underway at disposal sites on both east and west parcels. We
    are working with the appropriate agencies to negotiate a Federal
    Facilities Agreement governing cleanup activities. We are refining
    costs to complete cleanup estimates for range areas and resolve
    litigation issues filed by the residents of Vieques. We will close
    naval Station Roosevelt Roads by 31 March, as directed by the Fiscal
    Year 2004 Defense Appropriations Act. Naval Activity Puerto Rico will
    serve as the caretaker organization following operational closure.
    Puerto Rico has established a Local Redevelopment Authority, and we
    will proceed quickly to property disposal.
        Commander Navy Installations Command (CNI)
        We have aligned all Navy shore installations under a single command
    that will allow us to make better decisions about where to invest
    limited funds. By consolidating all base operations worldwide and
    implementing common support practices the Navy expects to save a
    substantial amount of money over the next 6 years.
    Communications
        FORCEnet will provide the overarching framework and standard
    communication mechanism for future combat systems. Navy Open
    Architecture, in conjunction with the FORCEnet standards, will provide
    a common open architecture for warfare systems aboard surface,
    subsurface and selected airborne platforms such as the E-2C Advanced
    Hawkeye. A critical subset application already being procured is the
    Cooperative Engagement Capability (CEC), which will be installed on 38
    ships and 4 squadrons (16 aircraft) by fiscal year 2006. CEC includes
    robust data communication capability among cooperating units in support
    of sensor netting. In the future, CEC will also include a Joint Track
    Manager to create a single integrated air picture of sufficient quality
    to support fire control application for each combat control system.
        Navy Marine Corps Internet (NMCI) is operational and providing
    commercial IT services for more than 300,000 DON employees and 2
    combatant commanders. To date, we have ordered 330,000 of the expected
    345,000 fiscal year 2004 seats. Implementing NMCI has enabled us to
    increase the security posture of our networks and has given
    unprecedented visibility into IT costs. As we roll out NMCI we are
    doing away with the over 1,000 separate networks that the Navy used to
    run. We have reduced the number of legacy applications in the Navy's
    inventory from 67,000 to about 31,000 and begun further efforts to
    reduce this number to around 7,000--an almost 90-percent reduction. As
    we proceed with NMCI, we anticipate other opportunities for progress in
    areas such as enterprise hosting, software release management, IT
    resource analysis and technology insertion.
        We have designed the NMCI operational evaluation to provide
    critical information necessary to determine how well NMCI is supporting
    mission of the user and to judge how well service level agreement
    metrics measure the service. As part of the spiral development process,
    NMCI worked with the testing community to segment the testing effort
    into a local evaluation of network services and a higher-level
    assessment of other enterprise services. Testing was completed 15
    December 2003; the final report is due in April.
    V. Navy and Marine Corps in Transformation (Future Readiness)
        The Chief of Naval Operations and Commandant of the Marine Corps
    consider the culture of transformation integral to the development of
    future combat capabilities. Innovative capabilities will result in
    profound increases in military power, maintaining the Navy and Marine
    Corps team as the preeminent global naval power. We are now at the
    point of delivering on many of our transformational goals.
        We have embraced a vision in how naval forces will contribute to
    joint warfighting in the future. This vision can only be implemented
    with the support of Congress. This section describes the principal
    components of Naval Vision 21.
    Acquisition Programs
        The fiscal year 2005 budget request supports continued funding for
    accelerated development of several critical technologies into the CVN
    21 leadship. This transformational 21st century ship, the future
    centerpiece of the Navy Carrier Strike Group, will bring many
    significant changes to the fleet. These changes include a new
    electrical power generation and distribution system, the
    electromagnetic aircraft launching system, a new enlarged flight deck,
    weapons and material handling improvements, and a crew reduction of at
    least 800. Construction of the CVN 21 remains on track to start in
    fiscal year 2007.
        Critical components of Sea Power 21 are the DD(X) and LCS. These
    ships, designed from the keel up to be part of a netted force, are the
    centerpieces of the 21st century surface combatant family of ships.
    DD(X) will be a multi-mission combatant tailored for land attack. LCS
    is envisioned to be a fast, agile, relatively small and affordable
    combatant capable of operating against anti-access, asymmetric threats
    in the littorals. The FYDP includes $2.76 billion to develop and
    procure modular mission packages to support three primary missions of
    mine countermeasures, anti-submarine warfare, and anti-terrorism and
    force protection. Detail design and construction of the first LCS is
    planned to begin in fiscal year 2005.
        The V-22 Osprey, a joint acquisition program, remains a top
    aviation acquisition priority. The V-22's increased capabilities of
    range, speed, payload, and survivability will generate truly
    transformational tactical and operational opportunities. With the
    Osprey, naval forces operating from the sea base will be able to take
    the best of long-range maneuver and strategic agility, and join it with
    the best of the sustainable forcible-entry capability. LRIP will
    continue until the Milestone III decision is made late calendar year
    2005. We expect to move from LRIP to FRP in calendar year 2006.
        Another important joint program with the Air Force, the JSF has
    just completed the second year of a 10-11 year development program. The
    program is working to translate concept designs to produce three
    variants. This is a complex process requiring more initial development
    than we predicted. JSF development is experiencing typical challenges
    that affect System Development and Demonstration (SDD) program schedule
    and cost. LRIP was deferred and research and development increased to
    cover SDD challenges. The current issues are solvable within the normal
    process of design fluctuation, and have taken prudent steps necessary
    to meet these challenges.
        The plan to re-capitalize the P-3 Maritime Patrol Aircraft with the
    MMA was further refined this past year in collaboration with the Broad
    Area Maritime Surveillance--Unmanned Aerial Vehicle or BAMS-UAV
    program. With a MMA IOC of fiscal year 2013, we also developed a robust
    sustainment plan for the current P-3 that includes special structural
    inspections and kits that extend the platform service life by a minimum
    of 5,000 hours. Additionally, the Department has decided to join the
    Army's Aerial Common Sensor (ACS) program as the replacement platform
    for the aging EP-3.
        In order to maintain Electronic Warfare (EW) superiority, the
    Department is pursuing both upgrades in current Airborne Electronic
    Attack (AEA) capability as well as a follow-on AEA aircraft to replace
    the aging EA-6B. The Navy has selected the EA-18G as its follow-on AEA
    aircraft and will begin to replace Navy EA-6Bs in fiscal year 2009.
        Continuing an emphasis on transformational systems, the Department
    has budgeted R&D funding through the FYDP for several aviation
    programs. The Advanced Hawkeye (previously known as E-2 Radar
    Modernization Program (RMP)) is funded through the FYDP with the first
    production aircraft in fiscal year 2009. A fully automated digital
    engine control and improved generators have been incorporated into the
    aircraft to improve performance and reliability. Additionally, the
    Department has included funding to support procurement of required
    capabilities in the fleet, such as Advanced Targeting Forward Looking
    Infrared and the Joint Helmet Mounted Cueing Systems.
        The fiscal year 2005 budget continues to demonstrate the
    Department's commitment to developing, acquiring and fielding
    transformational UAV technologies for ISR and tactical missions. The
    budget includes funding for a second Joint Unmanned Combat Air System
    (J-UCAS) demonstrator and continues development of the BAMS. The Navy's
    Unmanned Combat Air Vehicle (UCAV-N) is incorporated into J-UCAS under
    a DOD joint program office.
        Helicopters
        The fiscal year 2005 budget request includes an incremental
    approach to developing a replacement for the current aging Presidential
    helicopter. The Presidential Helicopter Replacement Aircraft (VXX) will
    enhance performance, survivability, communications, navigation, and
    executive accommodations inherent in the existing fleet of Presidential
    airlift helicopters.
        Ballistic Missile Defense (BMD)
        The fielding of a National Ballistic Missile Defense capability is
    critical to protecting the U.S. homeland against the evolving ballistic
    missile threat. As part of the President's directive to accelerate the
    fielding of a BMD Initial Defensive Operations capability by September
    2004, the Navy will deploy, on a continuous basis, a DDG to serve as a
    Long-Range Surveillance and Tracking (LRS&T) platform. Additionally,
    Aegis Ballistic Missile Defense (ABMD) continues its development and
    testing of the SM-3 missile in order to support deployment of a sea-
    based mid-course engagement capability by December 2005. Since November
    2002, ABMD had two of three successful intercepts with the SM-3 Block 0
    missile. The Navy is also evaluating the benefits associated with
    developing a Sea-based Terminal Missile Defense capability. A viable
    regional and terminal sea based ballistic missile defense system is
    important to ensure the safety of U.S. forces and the flow of U.S.
    forces through foreign ports and air fields when required.
        FORCEnet/Navy Open Architecture (OA)/Space/C\4\I
        FORCEnet is the operational construct and architectural framework
    for naval warfare in the Information Age which integrates warriors,
    sensors, networks, command and control, platforms and weapons into a
    networked, distributed combat force, scalable across the spectrum of
    conflict from seabed to space and sea to land. FORCEnet is the core of
    Sea Power 21 and Naval Transformation, and is the USN/USMC vehicle to
    make Network Centric Warfare an operational reality. It is being
    implemented in coordination with transformation initiatives in the
    Army, Air Force, and Coast Guard--enhancing efficiency, joint
    interoperability, and warfighting effectiveness. DD(X), LCS, CVN-21,
    SSGN, Virginia class SSNs, San Antonio class LPDs, and MMA are examples
    of platforms that are being designed from inception to perform in the
    netted environment of the future. Systems being procured and produced
    under the FORCEnet concept are CEC, Naval Fires Network (NFN), and
    Airborne/Maritime/Fixed (AMF) JTRS.
        The Navy is engineering a single open architecture for all warfare
    systems called Navy Open Architecture. Future systems will be designed
    to this architecture while legacy systems will be migrated to that
    single architecture where it is operationally and fiscally feasible.
    This integrates the Command and Control and Combat systems information
    flow using open specifications and standards and open architecture
    constructs, to support FORCEnet and other global information networks.
    Further, this significantly reduces the development and maintenance
    costs of computer programs. The Navy and its Joint Service partners
    continue to jointly engineer the Joint Track Manager and plan to
    implement it into Navy Open Architecture as the Open Architecture Track
    Manager. This joint focused application will be populated in all naval
    warfare systems that conform to the single OA warfare system
    architecture.
        The Navy and Marine Corps continues to pursue the maximum use of
    space to enhance our operational capabilities. We look to leverage
    existing systems and rapidly adapt emerging technology. For example,
    the Navy has long been the leader in ultrahigh frequency (UHF)
    satellite communications (SATCOM). The Navy is the executive agent for
    the next generation UHF SATCOM system. This program, the Mobile Users
    Objective System, will be the system used by all DOD components for
    their UHF communications needs.
        Sea Basing and Strategic Sealift
        Sea Basing is a transformational operating concept for projecting
    and sustaining naval power and a joint force, which assures joint
    access by leveraging the operational maneuver of sovereign,
    distributed, and networked forces operating globally from the sea.
        The Sea Basing concept has been endorsed by the other military
    services and its importance was confirmed when DOD announced a Joint
    Sea Basing Requirements Office will soon be established. Central to the
    staying power of naval forces will be the Maritime Pre-positioned
    Force-Future MPF (F). The fiscal year 2005 budget accelerates the lead
    MPF (F) from fiscal year 2008 to fiscal year 2007 to reflect an
    emphasis on Sea Basing capabilities.
    Infrastructure
        Prior Rounds of Base Realignment and Closure (BRAC)
        The Department of the Navy completed the closure and realignment of
    activities from the 1988, 1991, 1993, and 1995 rounds of BRAC. All that
    remains is to complete the environmental cleanup and property disposal
    on all or portions of 23 of the original 91 bases. We have had
    significant successes on both fronts. We are successfully using
    property sales as a means to expedite the disposal process as well as
    recover the value of the property for taxpayers. We sold 235 acres last
    year at the former Marine Corps Air Station, Tustin, California on the
    GSA Internet Web site for a net $204 million. We sold 22 acres at the
    former naval Air Facility Key West, Florida, in January 2004 for $15
    million. The City of Long Beach, California, opted to pre-pay its
    remaining balance on a promissory note, and gave us $11 million to
    conclude its purchase of the former Naval Hospital Long Beach,
    California. We are applying all funds to accelerate cleanup at
    remaining prior BRAC locations. More property sales are planned that
    will be used to finance remaining prior BRAC cleanup actions. Of the
    original 161,000 acres planned for disposal from all four prior BRAC
    rounds, we expect to have less than 7 percent (or about 11,000 acres)
    still to dispose by the end of this fiscal year.
        BRAC 2005
        The Fiscal Year 2002 Defense Authorization Act authorized another
    round of BRAC in 2005. We will scrupulously follow the process laid out
    in the law. We will treat each base equally and fairly, whether
    considered for closure or realignment in the past or not. In no event
    will we make any recommendations concerning any closures or realignment
    of our bases until all the data has been collected, certified and
    carefully analyzed within the overall BRAC 2005 statutory framework.
        BRAC 2005 gives us the opportunity to transform our infrastructure
    consistent with the significant changes that are, and will be,
    happening with the transformation of our force structure. The Secretary
    of Defense is leading a process to allow the military departments and
    defense components to closely examine joint use opportunities. Military
    operations in Afghanistan and Iraq demonstrated the force multiplier
    benefits of joint operations. We will apply those approaches to our
    shore infrastructure. We will look beyond the traditional stovepipes of
    Navy bases and Marine Corps bases in BRAC 2005 and take a joint
    approach matching military requirements against capacity and
    capabilities across the Department of Defense.
        The added benefit is the opportunity to eliminate excess capacity
    and seek greater efficiencies in our shore infrastructure. Continuing
    to operate and maintain facilities we no longer need diverts precious
    resources from our primary mission. Resources freed up as a result of
    this process will be used to re-capitalize our ships, aircraft,
    equipment, and installations for the future.
        Better Business Practices
        The DON has implemented several continuous improvement initiatives
    consistent with the goals of the President's management agenda that
    enable realignment of resources in order to re-capitalize.
        Specific initiatives include: converging our Enterprise Resource
    Planning (ERP) pilots into an end-to-end operating system;
    incorporating proven world class efficiency methodologies such as Six
    Sigma and Lean concepts into our day-to-day operations; and
    implementing additional Multi-Ship/Multi-Option (MSMO) repair contracts
    and Performance Based Logistics (PBL) agreements. Of note, Lean
    efficiency events that concentrate on increasing velocity and
    productivity in our Aviation Intermediate Maintenance Departments
    (AIMD) were initiated on U.S.S. George Washington (CVN 73) and U.S.S.
    Harry Truman (CVN 75). The outcome of these events will allow us to
    improve our afloat AIMD processes and influence our future manning
    requirements on CVN 21 Class carriers. These are the first Lean events
    conducted on Navy warships.
        These continuous improvement initiatives enable us to increase our
    combat capabilities with the expectation that we become more efficient,
    agile, flexible, and reliable at a reduced cost of doing business.
    VI. Our Total Force (Sailors, Marines, and Civilians)
        Today more than other time in recent history our sailors and
    marines have a greater understanding and appreciation for service to
    country. In time of war they have shown the Nation the highest
    standards of military professionalism and competence. The heaviest
    burdens in our war on terror fall, as always, on the men and women of
    our Armed Forces. We are blessed as a Nation to have a 228-year legacy
    where magnificent men and women volunteer to protect and defend
    America. Sailors and marines--along with our civilian workforce--remain
    the strong and steady foundation of our naval capabilities.
    Active Duty
        The Navy and Marine Corps again met enlisted recruiting and
    accession goals in 2003, and continue to attract America's finest young
    men and women to national service. The Navy achieved recruiting goals
    for a fifth consecutive year and in February completed the 31st
    consecutive month of attaining goals for accessions and new contracts.
    The Marine Corps met its 8th year of meeting monthly and annual
    enlisted recruiting goals and its 13th year of success in officer
    recruiting. Both Services are well positioned for success in meeting
    2004 officer and enlisted accession requirements.
        During 2003, the Navy implemented a policy requiring 94 percent of
    new recruits be high school diploma graduates (HSDG), and Navy
    recruiters succeeded by recruiting 94.3 percent HSDG. Navy Recruiting
    continued to seek the best and brightest young men and women by
    requiring that 62 percent of recruits score above 50 on the Armed
    Forces Qualification Test (AFQT); Navy recruiters excelled with a rate
    of 65.7 percent. Navy recruiting also sought to increase the number of
    recruits with college experience in fiscal year 2003, recruiting more
    than 3,200 applicants with at least 12 semester hours of college.
        The Marine Corps accessed 97.1 percent high school diploma
    graduates in fiscal year 2003, exceeding their annual goal of 95
    percent and ensured the Marine Corps recruited the highest quality
    young men and women with 70.3 percent of Marine Corps recruits scoring
    over 50 on the AFQT. This achievement exceeded their annual goal of 60
    percent of accessions scoring above 50 on the AFQT. The Marine Corps
    began fiscal year 2004 with a 58.8 percent starting pool in the Delayed
    Entry Program and has continued to achieve its monthly recruiting goals
    during the second quarter of fiscal year 2004. The Marine Corps Reserve
    achieved fiscal year 2003 recruiting goals, assessing 6,174 non-prior
    service marines and 2,663 prior service marines. Navy Recruiting was
    also successful in Naval Reserve recruiting by exceeding the enlisted
    goal of 12,000 recruits for fiscal year 2003.
        Retention
        Retaining the best and brightest is as important as recruiting
    them. Military compensation that is competitive with the private sector
    provides the flexibility required to meet that challenge.
        The Marine Corps has achieved first-term reenlistment goals over
    the past 9 years. They have already achieved 79.8 percent of their
    first-term retention goal and 59.8 percent of second tour and beyond
    goals. Officer retention is at a 19-year high.
        Retention in the Navy has never been better. For the third straight
    year, we experienced the highest retention in history. Retention goals
    for all categories were exceeded. As a result, at-sea personnel
    readiness is exceptional and enlisted gaps at sea are at an all-time
    low.
        Notwithstanding our current success in retention, we are constantly
    on alert for indicators; trends and developments that might affect our
    ability to attract and retain a capable, trained and talented
    workforce. We are aware that we need to compete for the best, and
    ensure continuing readiness, through a variety of means including
    effective compensation and bonus programs.
        The Selective Reenlistment Bonus (SRB) remains the primary tool
    available to the Navy and Marine Corps for retaining our best and
    brightest enlisted personnel. SRB represents an investment in the
    future of our Navy and Marine Corps. The Department of the Navy has a
    proven track record in the judicious management of this program and
    other continuation pays used to keep the right force mix to meet the
    Nations requirements. Your continued support of the SRB program as a
    proven and highly effective tool is important and appreciated.
        Attrition
        Navy leaders reduced attrition 10 percent from a year ago and 33
    percent from fiscal year 2000, while Marine Corps First-Term Post Boot
    Camp attrition continues the favorable downward trend begun in fiscal
    year 1999. For the Marine Corps, fiscal year 2003 attrition was at a
    historical low, down 1,773 from the previous year. This drop is due
    largely to a reduction in misconduct and incidents of desertion.
        The Department's ``Zero Tolerance'' drug-use policy continues to be
    strictly enforced, widely disseminated, and supported throughout the
    leadership. Through a comprehensive random drug testing program,
    educational programs, and command support, the Navy and Marine Corps
    team achieved an 18-percent reduction in attrition even while testing
    rates increased.
        Training
        The Navy and Marine Corps have defined their respective strategies
    for advancing into the future as part of a joint force. The Services
    have developed strategies that clearly define how Navy and Marine
    forces of the 21st century will be equipped, trained, educated,
    organized and used in our continued efforts to control the seas, to
    project American military influence abroad, and to protect our borders.
        Marine Corps' Strategy 21 defines as its vision and goal the
    development of enhanced strategic agility, operational reach, and
    tactical flexibility and enabled joint, allied, and coalition
    operations.
        Navy's Sea Power 21 defines its commitment to the growth and
    development of its service members. Sea Warrior is the ``people'' part
    of Sea Power 21. Its focus is on growing individuals from the moment
    they walk into a recruiting office through their assignments as Master
    Chiefs or Flag Officers, using a career continuum of training and
    education that gives them the tools they need to operate in an
    increasingly demanding and dynamic environment. Transformation for the
    future, leveraging technology and tapping into the genius of our people
    to make them more efficient and effective--creating a single business
    process for the range of human resource management activities is
    exactly what Sea Warrior is all about. Our goal remains attracting,
    developing, and retaining the more highly skilled and educated
    workforce of warriors that will lead the 21st century Navy.
    Reserves
        Reserves remain an integral part of our Navy and Marine Corps team.
    The Department of Defense is undergoing a transformation to a more
    responsive, lethal and agile force based on capabilities analysis
    rather than threat analysis. Last July, Secretary Rumsfeld issued a
    memorandum, Rebalancing Forces, in which he directed the Services to
    promote judicious and prudent use of rebalancing to improve readiness
    of the force and to help ease stress on units and individuals. Three
    areas of focus of the Services are:

            -- Enhance early responsiveness.
            -- Resolve stressed career fields.
            -- Employ innovative management practices.

        The Navy recently completed a study focused on redesigning the
    Naval Reserve so that it is better aligned with, and operationally
    relevant to, Active Forces. Working groups have been chartered to
    implement key points of the study. Implementation has commenced and
    will continue through this year and next. The three main areas of focus
    are Personnel Management, Readiness and Training, and Organizational
    Alignment. The Navy is transforming the Naval Reserve so that it is
    fully integrated with Active Forces. Reservists are shifting away from
    thinking of ``Naval Reserve requirements'' to ``Navy requirements''--a
    shift that includes goals, capabilities, and equipment. The Navy
    mission is the Naval Reserve mission. One Navy, one team, is the
    message.
        Naval and Marine Corps reservists are filling critical joint and
    internal billets along with their active counterparts. Naval and Marine
    Corps Reserve mobilization is a requirements-driven evolution and
    reservists, trained and ready, are making significant contributions.
    While the numbers of mobilized reservists can fluctuate as GWOT
    requirements dictate, our objective is to keep the number of mobilized
    personnel at a minimum.
        Since September 11, 2001, the Navy has mobilized over 22,000
    reservists with a peak of just over 12,000 during OIF. This is from a
    Selected Reserve population of just over 87,000. Mobilized commissioned
    naval units include Coastal Warfare, Construction Battalion, and
    Aviation communities, while individuals were mobilized primarily from
    Security Group, Naval Intelligence, Law Enforcement, and Physical
    Security augment units. We anticipate a steady state of approximately
    2,500 mobilized naval reservists this year.
        The Marine Corps has mobilized over 22,000 reservists from an
    authorized Selected Reserve end strength of 39,600 and just over 3,500
    from the Individual Ready Reserve. Currently mobilized reservists
    number just under 6,500. With OIF II requirements, the number of
    mobilized Marine reservists is expected to increase by approximately
    7,000. OIF II marines will deploy in two rotations of approximately 7
    months each, augmenting Marine Corps capabilities in Infantry, Armor,
    Aviation, Command, Control, Computers and Intelligence, Military
    Police, and Civil Affairs.
    Civilian Personnel
        A large part of the credit for the Navy's outstanding performance
    goes to our civilian workforce. These experienced and dedicated
    craftspeople, researchers, supply and maintenance specialists, computer
    experts, service providers, and their managers are an essential part of
    our total naval force concept.
        In the past, our ability to utilize these skilled human resources
    to accomplish the complex and fast-developing missions of the 21st
    century has been limited by the requirements of a 19th century
    personnel system. The Fiscal Year 2004 Defense Authorization Bill now
    allows DOD to significantly redesign a National Security Personnel
    System (NSPS) for the civilian workforce. This change represents the
    most significant improvement to civilian personnel management since the
    1978 Civil Service Reform Act.
        The DON has volunteered to be in the first wave of conversions to
    NSPS later this year. The Department expects to transition as many as
    150,000 of our dedicated, hard-working civilians to the new system this
    year. We will work closely with DOD to ensure we meet this aggressive
    timeline. We are also working Defense Acquisition Workforce Improvement
    Act streamlining initiatives alongside NSPS to ensure we use these
    tools to produce a robust and capable workforce.
        The reforms will provide supervisors and managers greater
    flexibility in managing our civil service employees, facilitate
    competition for high quality talent, offer compensation competitive
    with the private sector, and reward outstanding service. It will build
    greater pride in the civilian workforce and attract a new generation of
    civilians to public service. Properly executed, these changes also will
    assist us in better utilizing the Active-Duty Force by making it easier
    to employ civilians in jobs currently filled by uniformed military
    personnel.
        NSPS legislation will have a transformational effect on
    organizational design across the Department. NSPS will improve
    alignment of the human resources system with mission objectives,
    increase agility to respond to new business and strategic needs, and
    reduce administrative burden. The NSPS Act authorizes a more flexible
    civilian personnel management system that allows us to be a more
    competitive and progressive employer at a time when our national
    security demands a highly responsive system of civilian personnel
    management. The legislation also ensures merit systems principles
    govern changes in personnel management, whistleblowers are protected,
    discrimination remains illegal, and veterans' preference is protected.
    The process for the design of NSPS is specified by statue and covers
    the following areas: job classification, pay banding, staffing
    flexibilities, and pay for performance.
        The foundation for NSPS is a more rigorous tie between performance
    and monetary awards for employees and managers. Basic pay and
    performance incentives should be tied directly to the performance
    measurement process--supervisory personnel are also rewarded for
    successfully performing managerial duties. Implementation of this
    system will be a significant step forward by linking employees'
    performance to mission accomplishment and enabling better management of
    scarce resources throughout the DON.
        We are faced with a monumental change in how we will do business
    and an even larger cultural change from one of entitlement to one that
    has a performance-based compensation. This will be a huge effort and we
    are determined to ensure successful implementation. We will continue to
    scrutinize our human resource business methods. As we implement the
    bold initiatives in NSPS, we will take a hard look at our
    administrative policies with a specific eye on those that are
    burdensome or add no value.
    Quality of Service
        We will continue to provide an environment where our sailors and
    marines, and their families have confidence in themselves, in each
    other, in their equipment and weapons, and in the institution they have
    chosen to serve. This year, with your help, we continued the
    significant advances in compensation, in building the structure to
    realize the promise of the revolution in training, in improving
    bachelor and family housing, and in strengthening our partnership with
    Navy and Marine Corp families.
        The Department remains committed to improving living conditions for
    sailors and marines, and their families. Our policy is to rely first on
    the private sector to house military families. As a result, along with
    the initiative to increase Basic Allowance for Housing (BAH), the need
    and consequently the inventory for military family housing is going
    down. Additionally, we are partnering with the private sector in
    Public/Private Ventures (PPV) to eliminate inadequate housing.
        At the top of nearly any list put together in our partnership is
    the promise of medical care for sailors, marines, and their families.
    Naval medicine is a force multiplier, ensuring our troops are
    physically and mentally ready to whatever challenges lie ahead. High
    quality care and health protection are a vital part of our ability to
    fight the global war on terrorism and execute other worldwide mission.
    Naval medicine today is focused on supporting the deployment readiness
    of the uniformed services and promoting, protecting and maintaining the
    health of all those entrusted to naval medicine care--anytime,
    anywhere.
    Safety
        The Navy and Marine Corps are working to meet the Secretary of
    Defense's goal of reducing mishaps by 50 percent from fiscal year 2002
    to the end of fiscal year 2005. We have many initiatives in place and
    planned for the near future. We have seen real progress in reducing
    private motor vehicle fatalities, which are down 20 percent from the
    fiscal year 2002 baseline. We have begun applying technologies now used
    in commercial aviation to provide a visual and quantitative feedback
    loop to pilots and mechanics when either the pilot or aircraft has
    exceeded specific safety of flight parameters. We will continue to
    press forward with safety both to take care of people, our most
    precious asset, and to allow us to invest elsewhere.
    Shaping the Force
        The Navy is making an effort to reduce its active duty manpower as
    part of the DON transformation program. This is the first step and an
    integral part of our strategy to properly shape both the officer and
    enlisted force. Today, as the Navy moves to a more efficient and surge-
    ready force, maintaining the correct skill sets is more important than
    ever. We are convinced we can get the job done with fewer people; by
    eliminating excess manpower we can focus better on developing and
    rewarding our high-performing forces. Additionally, reducing manpower
    gradually today will ensure the Navy is properly manned when a new
    generation of optimally manned ships joins our force, with completely
    revised maintenance, training, and war-fighting requirements. We will
    ensure any manpower reductions will be preceded by reductions in
    functions.
    VII. Summary
        Naval forces remain a critical and unique element of our national
    security strategy. The Navy and Marine Corps team answers the
    President's call to duty by being the first on station--with staying
    power. Our forces exploit the open oceans and provide the combatant
    commander with persistent sovereign combat naval forces. This is the
    value that credible forward deployed naval forces provide our Nation.
        The fiscal year 2005 budget unifies many of our innovative and
    transformational technologies with Naval Power 21. Sustaining
    investment in naval forces continues to protect and promote American
    interests by allowing the forward deployed Navy and Marine Corps team
    to shape the international security environment and to respond to the
    full spectrum of current and future crises.
        With our fiscal year 2005 budget request we focus on people, combat
    capability, technology insertion, and improved business practices.
    Additionally, we continue to work with our joint service partners in
    organizing, equipping and training to fight jointly. With continued
    congressional support the Department of the Navy will position the Navy
    and Marine Corps team as part of the most formidable military force in
    the 21st century.

        Senator Inhofe. Thank you, Secretary England.
        Secretary Roche.

      STATEMENT OF HON. JAMES G. ROCHE, SECRETARY OF THE AIR FORCE

        Secretary Roche. Thank you, Mr. Chairman, Senator Levin,
    and members of the committee. It's my great pleasure to appear
    before this distinguished body to represent the 700,000 active,
    Guard, Reserve, and civilian airmen who are engaged in
    defending our Nation.
        General John Jumper and I are certainly proud of their
    achievements and service this past year, from combat
    operations, to homeland defense, to their daily efforts that
    guarantee the health, security, and morale of our force.
    They've contributed significantly to our Nation's global fight
    against terrorism, to our military achievements in Iraq and
    Afghanistan. They are devoted American servants, and have my
    utmost respect and confidence. But I'd also like to say how
    honored I am to serve alongside General John Jumper. He is an
    outstanding leader, and, like my two colleagues, it's a delight
    to work with him.
        Our highest priority continues to be a focus on warfighting
    and delivering the capability that enables us to remain
    decisive in combat. Combatant commanders rely on us to provide
    the full spectrum of air and space capabilities, all while
    protecting our homeland. Through the efforts of this committee,
    your colleagues in Congress, and dedicated professionals in the
    Department, we are proud to report that we are meeting these
    objectives.
        As we highlight in our written testimony, we continue to
    adapt the Air Force to realize the President and Secretary
    Rumsfeld's vision of transformation. Our strategy is to exploit
    the sources of strength that give us the military advantages
    that we enjoy today. Our goal is to build a portfolio of
    advantages, one that uses operational concepts to guide
    investments, is relevant to the joint character of warfare, and
    is useful in the increasingly asymmetric conduct of warfare. To
    date, we've made great progress in applying this approach.
        In terms of strategy, we refocused Air Force strategic
    thinking on core competencies, we refined our air expeditionary
    forces, and focused our training to support homeland defense,
    close-air support, and close partnering with land, maritime,
    and special operations forces. We are putting our space
    programs on track. We've increased the unity of effort among
    the Air Force, the National Reconnaissance Office, and
    intelligence community, and we have enhanced space support for
    the warfighter, bringing a joint perspective to our role as the
    Department of Defense's executive agent for space. We've made
    significant investments in our people over the past time.
        With respect to capabilities, we've delivered a transformed
    Air Force to the battlefield--armed Predators, Global Hawks,
    bombers working closely with battlefield airmen on the ground,
    new tactics for time-sensitive targets, networked intelligence
    surveillance, reconnaissance, and the combined air operations
    center.
        Where it makes sense, we've integrated active, Guard, and
    Reserve units as part of our future total force, and we
    continue to do so when it enhances our combat capability,
    increases our surge capacity, enables us to achieve
    efficiencies in how we organize, train, and equip our total
    force.
        We have engaged with industry to stabilize production of
    critical Air Force capabilities--the F/A-22, C-17, Predators,
    Global Hawk, and other systems--thereby, increasing
    efficiencies in the supplier base.
        We are transforming the F/A-22 by integrating new avionics
    and weapons that will make it the premier air-to-ground strike
    system in heavily defended areas, as well as highly effective
    against cruise missiles, in addition to its role in deterring
    any nation from challenging our ability to gain and maintain
    air dominance. Our F/A-22 budget request continues much needed
    program stability, and supports the transition from development
    to operational tests with initial operational capability (IOC)
    at the end of fiscal year 2005.
        Our next step is to focus in four distinct mission areas,
    all with demonstrable capabilities to support land and surface
    forces. We are realistically modernizing our special operations
    aircraft, starting with needed recapitalization of our
    helicopter force, continuing with the tools essential to link
    air and ground capabilities.
        We are increasing our attention to close air support from
    various altitudes. In this regard, we will seek to update an
    as-yet-to-be-determined number of A-10s, and we will acquire
    the short-takeoff vertical landing (STOVL) version of the Joint
    Strike Fighter (JSF) by further expanding our opportunities for
    integration with our Marine Corps brethren.
        We are developing a long-range strike strategy that
    includes an investment plan to sustain our legacy force, and
    possibly a future stealthy regional bomber.
        We are focusing on joint warfighting in space, working with
    other interested parties on rapid insertion of microsats, as
    well as potential methods of protecting our space assets.
        Beyond establishing and maintaining air dominance, there
    are initiatives where we are pressing forward with families of
    UAVs or remotely-piloted aircraft, many of which will support
    land combat directly and in real time. We are building a
    portfolio of sensing capabilities, and we continue to develop
    ground-moving target-indicator capabilities, cruise missile
    defense technologies, as well as new integration of battlefield
    command and control (C2) capabilities, all focused on dramatic
    support of land forces.
        In the interest of time, Mr. Chairman, I'll move past some
    of this.
        One of the concerns in our budget that I would like to
    highlight is the growing pressure and increased cost in our
    military healthcare system. Improvements to Tricare benefit
    over the past several years, coupled with escalating premiums
    and co-pays in the civilian sector, are driving many retirees
    and family members to choose Tricare. Over the past 2 years, we
    have seen an 8 percent increase in the number of retirees using
    our system. From one point of view, this is a good story,
    validation that we are caring for our retired service members.
    It comes, however, with significant cost growth. This year, the
    Department reprogrammed over $600 million to pay for this
    growth, costs increasingly absorbed by the Services. Although
    you will mark the DOD health program as a separate
    authorization, I ask that you keep this increased usage and
    cost in mind as you consider any proposed expansion of
    benefits.
        Finally, our budget request includes increases of both
    research, development, test, and evaluation (RDT&E) and
    procurement to support our emphasis on transformation and
    modernization consistent with the strategy we've discussed. Our
    proposed budget makes a significant investment in a number of
    critical joint programs: C-17s, C-130Js, Predators, Global
    Hawks, and joint space capabilities, including transformational
    communications, space-based radar, and military satellite
    communications. We are also investing in a wide range of joint
    weapons for close-air support and precision strike, including
    more than 23,000 Joint Direct Attack Munitions (JDAMs). In
    addition to our increased focus on air-to-ground concepts of
    operations (CONOPs), we are proud of our continued investment
    in these joint warfighting capabilities needed by our combatant
    commanders.
        Finally, our tanker recapitalization initiative is on hold.
    The initiative is complicated enough, so I am in complete
    agreement with Secretary Rumsfeld's desire to ensure that it
    was not tainted by any illegality. Meanwhile, as I told the
    committee 2 years ago, we are programming money, starting in
    fiscal year 2006, to conduct a KC-X tanker replacement program,
    which will be a normal new-aircraft procurement.
        Let me close today on the subject of sexual assault. With
    the help of this committee, your counterparts in the House, the
    Fowler panel, and the reinvigorated Air Force Academy Board of
    Visitors, we have taken a wide range of actions at the Academy
    to protect our cadets and to implement a system of response,
    investigation, and victim care consistent with that in the
    operational Air Force. Since the implementation of the Agenda
    for Change, in March of last year, and the release of the
    Fowler Panel Report, I am pleased to report that there has been
    meaningful progress across multiple fronts. The Academy senior
    leadership is aggressively focused on the areas of basic cadet
    training, officer development, and cadet discipline systems. In
    the area of prevention, we have sought outside experts to
    review and assist in training faculty, staff, and leadership.
    We have incorporated almost all of the Fowler recommendations
    to enhance training, implemented a tough new alcohol policy,
    and, most important, we have created an integrated response
    team for victims of sexual assault.
        But we continue to refine our approach. For instance, based
    on the Fowler Panel's recommendation of confidentiality we have
    attempted to strike a balance between the needs of the victim
    and the necessity of investigating felony allegations. While
    this is proving to be a difficult concept to implement, we
    sincerely believe it is in our best interest to remove barriers
    to victims coming forward so that we can prosecute criminal
    offenders.
        Whether we look at the record numbers or increasing quality
    of female applicants to the Academy, our initial indications
    are very positive. As of today, the Academy admissions office
    has received over 3,000 applications from women, an increase of
    over 35 percent, and the largest number of female applicants in
    the history of the Academy. The increases in the average grade
    point averages across all four classes of cadets, both male and
    female, appear to show that we are continuing to instill an
    improved climate for learning, as well. These are initial good
    signs, but we are in a long-term agenda to change the culture,
    and we know there is much to do, so we will remain focused.
        Finally, Mr. Chairman, I want to inform the committee of a
    recently commissioned assessment we've ordered of our sexual
    assault response system across the Air Force. General Jumper
    and I have tasked our major-command commanders to include
    education, training, and prevention, reporting procedures,
    response programs, and program oversight in these comprehensive
    reviews. We directed this assessment across our major commands
    prior to the recent articles about Sheppard Air Force Base. In
    fact, we did it very quietly in the fall of this year to do a
    review of our Pacific air forces in order to get a benchmark as
    to how our Active Force was doing relative to the things that
    we learned from the Air Force Academy's situation.
        Mr. Chairman, members of the committee, I am proud to be a
    part of the finest air force in the world, and am honored to be
    part of the joint team that has done much to defend America and
    our interests. With your continued support and the investment
    this budget makes in adapting our force for the demands of this
    new era, we will continue to deliver for our citizens.
        I look forward to your questions. Thank you very much.
        [The prepared statement of Secretary Roche follows:]
                   Prepared Statement by Hon. James G. Roche
        Mr. Chairman, Senator Levin, and distinguished members of the
    committee, the Air Force has an unlimited horizon for air and space
    capabilities. Our Service was borne of innovation, and we remain
    focused on identifying and developing the concepts of operations,
    advanced technologies, and integrated operations required to provide
    the joint force with unprecedented capabilities and to remain the
    world's dominant air and space force.
        Throughout our distinguished history, America's Air Force has
    remained the world's premier air and space power because of our
    professional airmen, our investment in warfighting technology, and our
    ability to integrate our people and systems together to produce
    decisive effects. These Air Force competencies are the foundation that
    will ensure we are prepared for the unknown threats of an uncertain
    future. They will ensure that our combatant commanders have the tools
    they need to maintain a broad and sustained advantage over any emerging
    adversaries.
        In this strategic environment of the 21st century, and along with
    our sister Services, our Air Force will continue to fulfill our
    obligation to protect America, deter aggression, assure our allies, and
    defeat our enemies. As we adapt the Air Force to the demands of this
    era, we remain committed to fulfilling our global commitments as part
    of the joint warfighting team. In partnership, and with the continuing
    assistance of Congress, we will shape the force to meet the needs of
    this century, fight the global war on terrorism, and defend our Nation.
        The 2004 Posture Statement is our vision for the upcoming year and
    is the blueprint we will follow to sustain our air and space dominance
    in the future. We are America's Air Force--disciplined airmen, dominant
    in warfighting, decisive in conflict.
                                  introduction
        In 2003, U.S. and coalition military operations produced
    unprecedented mission successes--across the spectrum of conflict and
    around the globe. The joint warfighting team demonstrated combat
    capability never previously witnessed in the history of conflict.
    Integrating capabilities from air, land, sea, and space, the U.S. and
    coalition allies achieved considerable progress in the ongoing global
    war on terrorism. In our most recent engagements, our Armed Forces
    fulfilled our immediate obligations to defend America, deter
    aggression, assure our allies, and defeat our enemies.
        The foundation of these achievements can be found in the Department
    of Defense's (DOD) commitment to teamwork and excellence. Operation
    Iraqi Freedom (OIF) was a joint and coalition warfighting effort from
    planning to execution. Air, ground, maritime, and space forces worked
    together at the same time for the same objectives, not merely staying
    out of each other's way, but orchestrated to achieve wartime
    objectives. Our air and space forces achieved dominance throughout the
    entire theater, enabling maritime and ground forces to operate without
    fear of enemy air attack. Our airmen demonstrated the flexibility,
    speed, precision, and compelling effects of air and space power,
    successfully engaging the full range of enemy targets, from the
    regime's leadership to fielded forces. When our ground and maritime
    components engaged the enemy, they were confident our airmen would be
    there--either in advance of their attacks, or in support of their
    operations. America's Air Force was there, disciplined, dominant, and
    decisive.
        These operational accomplishments illustrate the growing maturation
    of air and space power. Leveraging the expertise of our airmen, the
    technologies present in our 21st century force, and the strategies,
    concepts of operation, and organizations in use today, the U.S. Air
    Force continues to adapt to meet the demands of this new era, while
    pursuing the war on terrorism and defending the homeland.
        On September 11, 2001, the dangers of the 21st century became
    apparent to the world. Today, the U.S. faces an array of asymmetric
    threats from terrorists and rogue states, including a threat that poses
    the gravest danger to our Nation, the growing nexus of radicalism and
    technology. As we continue our work in Afghanistan and Iraq, we stand
    ready to respond to flashpoints around the world, prepared to counter
    the proliferation of weapons of mass destruction to unfriendly states
    and non-state entities.
        We are adapting to new and enduring challenges. As we do, we are
    exploiting the inherent sources of strength that give us the advantages
    we enjoy today. It is a strategy predicated on the idea that, if we
    accurately assess our own advantages and strengths, we can invest in
    them to yield high rates of military return. This approach helps us
    create a portfolio of advantages allowing us to produce and continue to
    exploit our capabilities. Our goal is to create a capability mix
    consistent with operational concepts and effects-driven methodology,
    relevant to the joint character and increasingly asymmetric conduct of
    warfare.
        Since 1945, when General Henry ``Hap'' Arnold and Dr. Theodore von
    Karman published ``Toward New Horizons,'' the Air Force has evolved to
    meet the changing needs of the Nation--with the sole objective of
    improving our ability to generate overwhelming and strategically
    compelling effects from air and now, space. It is our heritage to adapt
    and we will continue to do so. During this comparatively short history,
    we became the best air and space force in the world through our focus
    on the development of professional airmen, our investment in
    warfighting technology, and our ability to integrate people and systems
    to produce decisive joint warfighting effects.
        The Air Force is making a conscious investment in education,
    training, and leader development to foster critical thinking,
    innovation, and encourage risk taking. We deliberately prepare our
    airmen--officer, enlisted, and civilian--with experience, assignments,
    and broadening that will allow them to succeed. When our airmen act in
    the combined or joint arena, whether as an Air Liaison Officer to a
    ground maneuver element, or as the space advisor to the Joint Force
    Commander (JFC), this focused professional development will guide their
    success.
        We are also investing in technologies that will enable us to create
    a fully integrated force of intelligence capabilities, manned, unmanned
    and space assets that communicate at the machine-to-machine level, and
    real-time global command and control (C2) of joint, allied, and
    coalition forces. Collectively, these assets will enable compression of
    the targeting cycle and near-instantaneous global precision-strike.
        As we cultivate new concepts of global engagement, we will move
    from analog to digital processes and adopt more agile, non-linear ways
    of integrating to achieve mission success. This change in thinking
    leads to capabilities including: networked communications; multi-
    mission platforms which fuse multi-spectral sensors; integrated global
    intelligence, surveillance, and reconnaissance (ISR); robust, all-
    weather weapons delivery with increased standoff; small smart weapons;
    remotely-piloted and unattended aircraft systems; advanced air
    operations centers; more secure position, navigation, and timing; and a
    new generation of satellites with more operationally responsive launch
    systems.
        Investment in our core competencies is the foundation of our
    preparation for future threats. They ensure we have the tools we need
    to maintain strategic deterrence as well as a sustained advantage over
    our potential adversaries. Ultimately, they ensure we can deliver the
    dominant warfighting capability our Nation needs.
        Potential adversaries, however, continue to pursue capabilities
    that threaten the dominance we enjoy today. Double-digit surface-to-air
    missile systems (SAMs) are proliferating. China has purchased
    significant numbers of these advanced SAMs, and there is a risk of
    wider future proliferation to potential threat nations. Fifth-
    generation advanced aircraft with capabilities superior to our present
    fleet of frontline fighter/attack aircraft are in production. China has
    also purchased, and is developing, advanced fighter aircraft that are
    broadly comparable to the best of our current frontline fighters.
    Advanced cruise missile technology is expanding, and information
    technology is spreading. Access to satellite communications, imagery,
    and use of the Global Positioning System (GPS) signal for navigation
    are now available for anyone willing to purchase the necessary
    equipment or services. With this relentless technological progress and
    the potential parity of foreign nations, as well as their potential
    application in future threats, the mere maintenance of our aging
    aircraft and space systems will not suffice. Simply stated, our current
    fleet of legacy systems cannot always ensure air and space dominance in
    future engagements.
        To counter these trends, we are pursuing a range of strategies that
    will guide our modernization and recapitalization efforts. We are using
    a capabilities-based planning and budgeting process, an integrated and
    systematic risk assessment system, a commitment to shorter acquisition
    cycle times, and improved program oversight. Our goal is to integrate
    our combat, information warfare, and support systems to create a
    portfolio of air and space advantages for the joint warfighter and the
    Nation. Thus, we continue to advocate for program stability in our
    modernization and investment accounts.
        The principal mechanisms that facilitate this process are our Air
    Force Concepts of Operation (CONOPs). Through the CONOPs, we analyze
    problems we'll be asked to solve for the JFCs, identify the
    capabilities our expeditionary forces need to accomplish their
    missions, and define the operational effects we expect to produce.
    Through this approach, we can make smarter decisions about future
    investment, articulate the link between systems and employment
    concepts, and identify our capability gaps and risks.
        The priorities that emerge from the CONOPs will guide a reformed
    acquisition process that includes more active, continuous, and creative
    partnerships among the requirement, development, operational test, and
    industry communities who work side-by-side at the program level. In our
    science and technology planning, we are also working to demonstrate and
    integrate promising technologies quickly by providing an operational
    ``pull'' that conveys a clear vision of the capabilities we need for
    the future.
        We are applying this approach to our space systems as well. As the
    DOD's Executive Agent for Space, we are producing innovative solutions
    for the most challenging national security problems. We have defined a
    series of priorities essential to delivering space-based capabilities
    to the joint warfighter and the Intelligence Community. Achieving
    mission success--in operations and acquisition--is our principal
    priority. This requires us to concentrate on designing and building
    quality into our systems. To achieve these exacting standards, we will
    concentrate on the technical aspects of our space programs early on--
    relying on strong systems engineering design, discipline, and robust
    test programs. We also have many areas that require a sustained
    investment. We need to replace aging satellites, improve outmoded
    ground control stations, achieve space control capabilities to ensure
    freedom of action, sustain operationally responsive assured access to
    space, address bandwidth limitations, and focus space science and
    technology investment programs. This effort will require reinvigorating
    the space industrial base and funding smaller technology incubators to
    generate creative ``over the horizon'' ideas.
        As we address the problem of aging systems through renewed
    investment, we will continue to find innovative means to keep current
    systems operationally effective. In OIF, the spirit of innovation
    flourished. We achieved a number of air and space power firsts:
    employment of the B-1 bomber's synthetic aperture radar and ground
    moving target indicator for ISR; incorporation of the Litening II
    targeting pod on the F-15, F-16, A-10, and the B-52; and use of a
    Global Hawk for strike coordination and reconnaissance while flown as a
    remotely piloted aircraft. With these integrated air and space
    capabilities, we were able to precisely find, fix, track, target, and
    rapidly engage our adversaries. These examples illustrate how we are
    approaching adaptation in the U.S. Air Force.
        Ultimately, the success of our Air Force in accomplishing our
    mission and adapting to the exigencies of combat stems from the more
    than 700,000 active, Guard, Reserve, and civilian professionals who
    proudly call themselves ``airmen.'' In the past 5 years, they have
    displayed their competence and bravery in three major conflicts: the
    Balkans, Afghanistan, and Iraq. They are a formidable warfighting
    force, imbued with an expeditionary culture, and ready for the
    challenges of a dangerous world.
        Poised to defend America's interests, we continue to satisfy an
    unprecedented demand for air and space warfighting capabilities--
    projecting American power globally while providing effective homeland
    defense. This is the U.S. Air Force in 2004--we foster ingenuity in the
    world's most professional airmen, thrive on transitioning new
    technologies into joint warfighting systems, and drive relentlessly
    toward integration to realize the potential of our air and space
    capabilities. We are America's airmen--confident in our capability to
    provide our Nation with dominance in air and space.
                  air and space dominance in a new environment
        The U.S. Air Force ensures a flexible, responsive, and dominant
    force by providing a spectrum of operational capabilities that
    integrate with joint and Coalition Forces. To sustain and improve upon
    the dominance we enjoy today, the Air Force will remain engaged with
    the other services, our coalition partners, interagency teams, and the
    aerospace industry. As we do, we will incorporate the lessons learned
    from rigorous evaluation of past operations, detailed analyses of
    ongoing combat operations, and thoughtful prediction of the
    capabilities required of a future force.
        The pace of operations over the past year enabled us to validate
    the function and structure of our Air and Space Expeditionary Forces
    (AEFs). Operations in 2003 demanded more capability from our AEFs than
    at any time since their inception in 1998. However, for the first time
    we relied exclusively on our AEFs to present the full range of our
    capabilities to the combatant commanders. Through our 10 AEFs, our AEF
    prime capabilities (space, national ISR, long range strike, nuclear,
    and other assets), and our AEF mobility assets, we demonstrated our
    ability to package forces, selecting the most appropriate combat ready
    forces from our total force, built and presented expeditionary units,
    and flowed them to the theaters of operation in a timely and logical
    sequence. We rapidly delivered them to the warfighters, while
    preserving a highly capable residual force to satisfy our global
    commitments.
        More than three-fourths of our 359,300 active duty airmen are
    eligible to deploy and are assigned to an AEF. Through much of the past
    year, Total Force capabilities from 8 of the 10 AEFs were engaged
    simultaneously in worldwide operations. The remaining elements were
    returning from operations, training, or preparing to relieve those
    currently engaged. By the end of 2003, more than 26,000 airmen were
    deployed, supporting operations around the world.
        In 2004, we will continue to use the AEFs to meet our global
    requirements while concurrently reconstituting the force. Our number
    one reconstitution priority is returning our forces to a sustainable
    AEF battle rhythm while conducting combat operations. Attaining this
    goal is about revitalizing capabilities. For most airmen, that will
    include a renewed emphasis on joint composite force training and
    preparation for rotations in the AEF. Through the AEF, the Air Force
    presents right-sized, highly trained expeditionary units to JFCs for
    employment across the spectrum of conflict.
    Global War on Terrorism
        The year 2003 marked another historic milestone for the U.S. and
    the Air Force in the global war on terrorism. Since September 11, 2001,
    air and space power has proven indispensable to securing American
    skies, defeating the Taliban, denying sanctuary to al Qaeda and other
    terrorist organizations, and most recently, removing a brutal and
    oppressive dictator in Iraq. This global war on terrorism imposes on
    airmen a new steady state of accelerated operations and personnel tempo
    (PERSTEMPO), as well as a demand for unprecedented speed, agility, and
    innovation in defeating unconventional and unexpected threats, all
    while bringing stability and freedom to Afghanistan and Iraq. The Air
    Force and its airmen will meet these demands.
    Operation Noble Eagle
        High above our Nation, airmen protect our skies and cities through
    air defense operations known as Operation Noble Eagle (ONE). The Total
    Force team, comprised of active duty, Air National Guard, and Air Force
    Reserve airmen, conducts airborne early warning, air refueling, and
    combat air patrol operations in order to protect sensitive sites,
    metropolitan areas, and critical infrastructure.
        This constant ``top cover'' demands significant Air Force assets,
    thus raising the baseline of requirements above the pre-September 11
    tempo. Since 2001, this baseline has meant over 34,000 fighter, tanker,
    and airborne early warning sorties were added to Air Force
    requirements.
        This year the Air Force scrambled nearly 1,000 aircraft, responding
    to 800 incidents. Eight active duty, 8 Air Force Reserve, and 18 Air
    National Guard units provided 1,300 tanker sorties offloading more than
    32 million pounds of fuel for these missions. Last year, over 2,400
    airmen stood vigilant at air defense sector operations centers and
    other radar sites. Additionally, in 2003, we continued to
    institutionalize changes to our homeland defense mission through joint,
    combined, and interagency training and planning. Participating in the
    initial validation exercise Determined Promise-03, the Air Force
    illustrated how its air defense, air mobility, and command and control
    capabilities work seamlessly with other agencies supporting NORTHCOM
    and Department of Homeland Security objectives. The integration and
    readiness that comes from careful planning and rigorous training will
    ensure the continued security of America's skies.
    Operation Enduring Freedom--Afghanistan
        Operation Enduring Freedom--Afghanistan (OEF) is ongoing. Remnants
    of Taliban forces continue to attack U.S., NATO, coalition troops,
    humanitarian aid workers, and others involved in the reconstruction of
    Afghanistan. To defeat this threat, aid coalition stability, and
    support operations, the Air Force has maintained a presence of nearly
    24,000 airmen in and around the region. Having already flown more than
    90,000 sorties (over 72 percent of all OEF missions flown), the Air
    Force team of active, Guard, and Reserve airmen continue to perform
    ISR, close air support (CAS), aerial refueling, and tactical and
    strategic airlift.
        While fully engaged in ONE and OIF, the men and women of the Air
    Force provided full spectrum air and space support, orchestrating
    assets from every service and 10 different nations. Of these, Air Force
    strike aircraft flying from nine bases flew more than two-thirds of the
    combat missions, dropped more than 66,000 munitions (9,650 tons) and
    damaged or destroyed approximately three-quarters of planned targets.
    In 2003 alone, Air Force assets provided more than 3,000 sorties of on-
    call CAS, responding to calls from joint and/or Coalition Forces on the
    ground.
        Last year, the Air Force brought personnel and materiel into this
    distant, land-locked nation via 7,410 sorties. Over 4,100 passengers
    and 487 tons of cargo were moved by airmen operating at various Tanker
    Airlift Control Elements in and around Afghanistan. To support these
    airlift and combat sorties and the numerous air assets of the coalition
    with aerial refueling, the Air Force deployed over 50 tankers. In their
    primary role, these late 1950s-era and early 1960s-era KC-135 tankers
    flew more than 3,900 refueling missions. In their secondary airlift
    role, they delivered 3,620 passengers and 405 tons of cargo. Without
    versatile tankers, our Armed Forces would need greater access to
    foreign bases, more aircraft to accomplish the same mission, more
    airlift assets, and generate more sorties to maintain the required
    duration on-station.
        Operations in Afghanistan also highlight U.S. and coalition
    reliance on U.S. space capabilities. This spanned accurate global
    weather, precise navigation, communications, as well as persistent
    worldwide missile warning and surveillance. For example, OEF relied on
    precision navigation provided by the Air Force's GPS constellation,
    over-the-horizon satellite communications (SATCOM), and timely
    observations of weather, geodesy, and enemy activity. To accomplish
    this, space professionals performed thousands of precise satellite
    contacts and hundreds of station keeping adjustments to provide
    transparent space capability to the warfighter. These vital space
    capabilities and joint enablers directly leveraged our ability to
    pursue U.S. objectives in OEF.
    Operations Northern Watch and Southern Watch
        During the past 12 years, the Air Force flew over 391,000 sorties
    enforcing the northern and southern no-fly zones over Iraq. With the
    preponderance of forces, the Air Force, along with the Navy and Marine
    Corps, worked alongside the Royal Air Force in Operations Northern
    Watch (ONW) and Southern Watch (OSW). Manning radar outposts and
    established C2 centers, conducting ISR along Iraq's borders, responding
    to almost daily acts of Iraqi aggression, and maintaining the required
    airlift and air refueling missions taxed Air Force assets since the end
    of Operation Desert Storm. Yet, these successful air operations had
    three main effects: they halted air attacks on the ethnic minority
    populations under the no-fly zones; they deterred a repeat of Iraqi
    aggression against its neighbors; and they leveraged enforcement of
    United Nations Security Council Resolutions. Throughout this period,
    our airmen honed their warfighting skills, gained familiarity with the
    region, and were able to establish favorable conditions for OIF. For
    more than a decade, American airmen rose to one of our Nation's most
    important challenges, containing Saddam Hussein.
    Operation Iraqi Freedom
        On 19 March 2003, our airmen, alongside fellow soldiers, sailors,
    marines, and coalition teammates, were called upon to remove the
    dangerous and oppressive Iraqi regime--this date marked the end of ONW/
    OSW and the beginning of OIF. OIF crystallized the meaning of jointness
    and the synergies of combined arms and persistent battlefield
    awareness.
        In the first minutes of OIF, airmen of our Combat Air Forces (USAF,
    USN, USMC, and coalition) were flying over Baghdad. As major land
    forces crossed the line of departure, Air Force assets pounded Iraqi
    command and control facilities and key leadership targets, decapitating
    the decisionmakers from their fielded forces. Remaining Iraqi leaders
    operated with outdated information about ground forces that had already
    moved miles beyond their reach. As the land component raced toward
    Baghdad, coalition strike aircraft were simultaneously attacking Iraqi
    fielded forces, communications and command and control centers,
    surface-to-surface missile launch sites, and were supporting special
    operations forces, and ensuring complete air and space dominance in the
    skies over Iraq. Due to these actions and those during the previous 12
    years, none of the 19 Iraqi missile launches were successful in
    disrupting coalition operations, and not a single Iraqi combat sortie
    flew during this conflict. Twenty-one days after major combat
    operations began, the first U.S. land forces reached Baghdad. Five days
    later, the last major city in Iraq capitulated.
        The Air Force provided over 7,000 CAS sorties to aid land forces in
    the quickest ground force movement in history. Lieutenant General
    William S. Wallace, Commander of the U.S. Army V Corps said, ``none of
    my commanders complained about the availability, responsiveness, or
    effectiveness of CAS--it was unprecedented!'' As Iraqi forces attempted
    to stand against the integrated air and ground offensive, they found a
    joint and coalition team that was better equipped, better trained, and
    better led than ever brought to the field of battle.
        Training, leadership, and innovation coupled with the Air Force's
    recent investment in air mobility allowed U.S. forces to open a second
    major front in the Iraqi campaign. Constrained from access by land, Air
    Force C-17s airdropped over 1,000 paratroopers from the 173rd Airborne
    Brigade into northern Iraq. This successful mission opened Bashur
    airfield and ensured U.S. forces could be resupplied.
        Before 2003, the Air Force invested heavily in the lessons learned
    from OEF. Shortening the ``kill chain,'' or the time it took to find,
    fix, track, target, engage, and assess was one of our top priorities.
    This investment was worthwhile, as 156 time-sensitive targets were
    engaged within minutes, most with precision weapons. The flexibility of
    centralized control and decentralized execution of air and space power
    enabled direct support to JFC objectives throughout Iraq. Coalition and
    joint airpower shaped the battlefield ahead of ground forces, provided
    intelligence and security to the flanks and rear of the rapidly
    advancing coalition, and served as a force multiplier for Special
    Operations Forces. This synergy between Special Operations and the Air
    Force allowed small specialized teams to have a major effect throughout
    the northern and western portions of Iraq by magnifying their inherent
    lethality, guaranteeing rapid tactical mobility, reducing their
    footprint through aerial resupply, and providing them the advantage of
    ``knowing what was over the next hill'' through air and space-borne
    ISR.
        The Air Force's C\2\ISR assets enabled the joint force in
    Afghanistan as well. This invaluable fleet includes the RC-135 Rivet
    Joint, E-8 Joint Surveillance and Target Attack Radar System (JSTARS),
    and the E-3 AWACS. This ``Iron Triad'' of intelligence sensors and C2
    capabilities illustrates the Air Force vision of horizontal integration
    in terms of persistent battlefield awareness. Combined with the Global
    Hawk unmanned aerial vehicle and Predator remotely piloted aircraft,
    spaced-based systems, U-2, and Compass Call, these invaluable system
    provided all-weather, multi-source intelligence to commanders from all
    services throughout the area of responsibility.
        OIF was the Predator's first ``networked'' operation. Four
    simultaneous Predator orbits were flown over Iraq and an additional
    orbit operated over Afghanistan, with three of those orbits controlled
    via remote operations in the U.S. This combined reachback enabled
    dynamic support to numerous OIF missions. Predator also contributed to
    our operational flexibility, accomplishing hunter-killer missions,
    tactical ballistic missile search, force protection, focused
    intelligence collection, air strike control, and special operations
    support. A Hellfire equipped Predator also conducted numerous precision
    strikes against Iraqi targets, and flew armed escort missions with U.S.
    Army helicopters.
        Space power provided precise, all-weather navigation, global
    communications, missile warning, and surveillance. The ability to adapt
    to adverse weather conditions, including sandstorms, allowed air, land,
    and maritime forces to confound the Iraqi military and denied safe
    haven anywhere in their own country. As the Iraqis attempted to use
    ground-based GPS jammers, Air Force strike assets destroyed them, in
    some cases, using the very munitions the jammers attempted to defeat.
    As Defense Secretary Donald Rumsfeld noted, this new era was
    illustrated by the coalition's ``unprecedented combination of power,
    precision, speed, and flexibility.''
        During the height of OIF, the Air Force deployed 54,955 airmen.
    Ambassador Paul Bremer, Chief of the Coalition Provisional Authority,
    pronounced, ``In roughly 3 weeks [we] liberated a country larger than
    Germany and Italy combined, and [we] did so with forces smaller than
    the Army of the Potomac.'' Led by the finest officers and non-
    commissioned officers, our airmen flew more than 79,000 sorties since
    March of 2003. Ten thousand strike sorties dropped 37,065 munitions.
    The coalition flew over 55,000 airlift sorties moved 469,093 passengers
    and more than 165,060 tons of cargo. In addition, over 10,000 aerial
    refueling missions supported aircraft from all services, and 1,600 ISR
    missions provided battlespace awareness regardless of uniform, service,
    or coalition nationality. This was a blistering campaign that demanded
    a joint and combined effort to maximize effects in the battlespace.
        Today, Air Force airmen continue to contribute to the joint and
    coalition team engaged in Iraq. At the end of the year, 6,723 airmen
    from the active duty, Reserve, and Air National Guard conducted a wide
    range of missions from locations overseas, flying approximately 150
    sorties per day including CAS for ground forces tracking down regime
    loyalists, foreign fighters, and terrorists. On a daily basis, U-2 and
    RC-135 aircraft flew ISR sorties monitoring the porous borders of Iraq
    and providing situational awareness and route planning for Army patrols
    in stability and support operations. Providing everything from base
    security for 27 new bases opened by the coalition to the lifeline of
    supplies that air mobility and air refueling assets bring to all joint
    forces, Air Force airmen are committed to the successful accomplishment
    of the U.S. mission in Iraq.
    Other Contingency Operations
        In 2003, the Air Force remained engaged in America's war on drugs
    and provided support to NATO ground forces in the Balkans. Since
    December 1989, Air Force airmen have been an irreplaceable part of the
    interagency fight against illegal drug and narcotics trafficking.
    Deployed along the southern U.S., in the Caribbean, and Central and
    South America, airmen perform this round-the-clock mission, manning
    nine ground-based radar sites, operating ten aerostats, and flying
    counter drug surveillance missions. The Air Force detected, monitored,
    and provided intercepts on over 275 targets attempting to infiltrate
    our airspace without clearance. Along with our interagency partners,
    these operations resulted in 221 arrests and stopped hundreds of tons
    of contraband from being smuggled into our country.
        In the Balkans, airmen are fully committed to completing the
    mission that they started in the 1990s. Today, Air Force airmen have
    flown over 26,000 sorties supporting Operations Joint Guardian and
    Joint Forge. These NATO-led operations combine joint and allied forces
    to implement the Dayton Peace Accords in Bosnia-Herzegovina and enforce
    the Military Technical Agreement in Kosovo. At the end of 2003,
    approximately 800 airmen were supporting NATO's goal of achieving a
    secure environment and promoting stability in the region.
        Additionally, the Air Force engaged in deterrence and humanitarian
    relief in other regions. While the world's attention was focused on the
    Middle East in the spring of 2003, our Nation remained vigilant against
    potential adversaries in Asia. The Air Force deployed a bomber wing--24
    B-52s and B-1s--to the American territory of Guam to deter North Korea.
    At the height of OIF, our Air Force demonstrated our country's resolve
    and ability to defend the Republic of Korea and Japan by surging bomber
    operations to over 100 sorties in less than 3 days. This deterrent
    operation complemented our permanent engagement in Northeast Asia. The
    8,300 airmen who are stationed alongside the soldiers, sailors,
    Marines, and our Korean allies maintained the United Nations armistice,
    marking 50 years of peace on the peninsula.
        Our strength in deterring aggression was matched by our strength in
    humanitarian action. In response to President Bush's directive to help
    stop the worsening crisis in Liberia, we deployed a non-combat medical
    and logistics force to create a lifeline to the American Embassy and
    provide hope to the Liberian people. An Expeditionary Group of airmen
    provided airlift support, aeromedical evacuation, force protection, and
    theater of communications support. Flying more than 200 sorties, we
    transported and evacuated civilians and members of the Joint Task Force
    (JTF) from bases in Sierra Leone and Senegal. The 300 airmen deployed
    in support of JTF-Liberia reopened the main airport in Monrovia, and
    ensured the security for U.S. military and civilian aircraft providing
    relief aid.
    Strategic Deterrence
        The ability of U.S. conventional forces to operate and project
    decisive force is built on the foundation of our strategic deterrent
    force; one that consists of our nuclear-capable aircraft and
    Intercontinental Ballistic Missile forces, working with the U.S. Navy's
    Fleet Ballistic Missile Submarines. In 2003, these forces as well as
    persistent overhead missile warning sensors and supporting ground-based
    radars provided uninterrupted global vigilance deterring a nuclear
    missile strike against the U.S. or our allies. The dedicated airmen who
    operate these systems provide the force capability that yields our
    deterrent umbrella. Should that deterrence fail, they stand ready to
    provide a prompt, scalable response.
    Exercises
        The Air Force's success can be attributed to the training,
    education, and equipment of our airmen. Future readiness of our
    operations, maintenance, mission support, and medical units will depend
    on rigorous and innovative joint and coalition training and exercising.
    This year we are planning 140 exercises with other services and
    agencies and we anticipate being involved with 103 allied nations. We
    will conduct these exercises in as many as 45 foreign countries.
    Participation ranges from the Joint/Combined command post exercise
    Ulchi Focus Lens with our South Korean partners to the tailored
    international participation in our FLAG exercises and Mission
    Employment Phases of USAF Weapons School. From joint search-and-rescue
    forces in Arctic Sarex to Partnership for Peace initiatives, our airmen
    must continue to take advantage of all opportunities that help us train
    the way we intend to fight.
        In addition to previously designed exercises, recent operations
    highlighted the need for combat support training. During OEF and OIF,
    the Air Force opened or improved 38 bases used by joint or coalition
    forces during combat. Our Expeditionary Combat Support teams
    established secure, operable airfields in Kyrgyzstan, Uzbekistan,
    Pakistan, and in Iraq. They also built housing, established
    communications, and erected dining facilities that are still used by
    other services and follow-on forces today. To prepare our airmen for
    these missions, we have created Eagle Flag, an Expeditionary Combat
    Support Field Training Exercise. During this exercise, combat support
    personnel apply the integrated skills needed to organize and create an
    operating location ready to receive fully mission capable forces within
    72 hours. From security forces and civil engineers to air traffic
    controllers and logisticians, each airman required to open a new base
    or improve an austere location will eventually participate in this
    valuable exercise.
        Our ranges and air space are critical joint enablers and vital
    national assets that allow the Air Force to develop and test new
    weapons, train forces, and conduct joint exercises. The ability of the
    Air Force to effectively operate requires a finite set of natural and
    fabricated resources. Encroachment of surrounding communities onto Air
    Force resources results in our limited or denied access to, or use of,
    these resources. We have made it a priority to define and quantify the
    resources needed to support mission requirements, and to measure and
    communicate the effects of encroachment on our installations, radio
    frequency spectrum, ranges, and air space. We will continue to work
    with outside agencies and the public to address these issues. The Air
    Force strongly endorses the Readiness Range and Preservation
    Initiative. It would make focused legislative changes, protecting the
    Air Force's operational resources while continuing to preserve our
    Nation's environment.
    Lessons for the Future
        As we continue combat operations and prepare for an uncertain
    future, we are examining lessons from our recent experiences. Although
    we are currently engaged with each of the other services to refine the
    lessons from OIF, many of the priorities listed in the fiscal year 2005
    Presidential budget submission reflect our preliminary conclusions. The
    Air Force has established a team committed to turning validated lessons
    into new equipment, new operating concepts, and possibly new
    organizational structures. Working closely with our joint and coalition
    partners, we intend to continue our momentum toward an even more
    effective fighting force.
        One of the most important lessons we can draw was envisioned by the
    authors of the Goldwater-Nichols Act. ONE, OEF, and OIF all validated
    jointness as the only acceptable method of fighting and winning this
    nation's wars. In OIF, the mature relationship between the Combined
    Forces Land Component Commander (CFLCC) and the Combined Forces Air
    Component Commander (CFACC) led to unprecedented synergies. The CFACC
    capitalized on these opportunities by establishing coordination
    entities led by an Air Force general officer in the supported land
    component headquarters and by maintaining internal Army, Navy, Marine
    Corps, and coalition officers in his own headquarters. Both of these
    organizational innovations enabled commanders to maximize the
    advantages of mass, lethality, and flexibility of airpower in the area
    of responsibility.
        Another lesson is the Air Force's dependence on the Total Force
    concept. As stated above, September 11 brought with it a new tempo of
    operations, one that required both the active duty and Air Reserve
    Component (ARC) to work in concert to achieve our national security
    objectives. The synergy of our fully integrated active duty, Air
    National Guard and Air Force Reserve team provides warfighters with
    capabilities that these components could not provide alone.
        Our Reserve component accounts for over one-third of our strike
    fighters, more than 72 percent of our tactical airlift, 42 percent of
    our strategic airlift, and 52 percent of our air refueling capability.
    The ARC also makes significant contributions to our rescue and support
    missions, and has an increasing presence in space, intelligence, and
    information operations. In all, the ARC provides a ready force
    requiring minimum preparation for mobilization. Whether that
    mobilization is supporting flight or alert missions for ONE, commanding
    expeditionary wings in combat, or orchestrating the Air Force Special
    Operations roles in the western Iraqi desert, the ARC will remain
    critical to achieving the full potential of our air and space power.
        A third lesson was validation of the need for air and space
    superiority. Through recent combat operations, the Air Force maintained
    its almost 50 year-old record of ``no U.S. ground troops killed by
    enemy air attack.'' Without having to defend against Iraqi airpower,
    coalition commanders could focus their combat power more effectively.
    In addition, air and space superiority allowed airmen to dedicate more
    sorties in support of the ground scheme of maneuver, substantially
    reducing enemy capability in advance of the land component.
        We also need to continue to advance integration and planning--
    integration of service capabilities to achieve JFC objectives,
    interagency integration to fight the war on terrorism, and information
    integration. Integration of manned, unmanned and space sensors,
    advanced command and control, and the ability to disseminate and act on
    this information in near-real time will drive our combat effectiveness
    in the future. Shared through interoperable machine-to-machine
    interfaces, this data can paint a picture of the battlespace where the
    sum of the wisdom of all sensors will end up with a cursor over the
    target for the operator who can save the target, study the target, or
    destroy the target.
        Finally, there are three general areas for improvement we consider
    imperative: battle damage assessment, fratricide prevention/combat
    identification, and equipping our battlefield airmen. First, battle
    damage assessment shapes the commander's ability for efficient
    employment of military power. Restriking targets that have already been
    destroyed, damaged, or made irrelevant by rapid ground force advances
    wastes sorties that could be devoted to other coalition and joint force
    objectives. Advances in delivery capabilities of our modern fighter/
    attack aircraft and bombers mean that ISR assets must assess more
    targets per strike than ever before. Precision engagement requires
    precision location, identification, and precision assessment. Although
    assets like the Global Hawk, Predator, U-2, Senior Scout, and Rivet
    Joint are equipped with the latest collection technology, the Air
    Force, joint team, and Intelligence Community must work to ensure that
    combat assessments produce timely, accurate, and relevant products for
    the warfighters.
        We are also improving operational procedures and technology to
    minimize incidents of fratricide or ``friendly fire.'' In OIF, major
    steps toward this goal resulted from technological solutions. Blue
    Force Tracker and other combat identification systems on many ground
    force vehicles allowed commanders situational awareness of their forces
    and enemy forces via a common operational picture. Still, not all joint
    or coalition forces are equipped with these technological advances. We
    are pursuing Fire Support Coordination Measures that capitalize on the
    speed and situational awareness digital communications offer rather
    than analog voice communications and grease pencils.
        A third area we are actively improving is the effectiveness of the
    airmen who are embedded with conventional land or Special Forces. With
    assured access to Air Force datalinks and satellites, these
    ``Battlefield Airmen'' can put data directly into air-land-sea weapon
    systems and enable joint force command and control. We have made great
    progress in producing a Battlefield Air Operations Kit that is 70
    percent lighter, with leading-edge power sources; one that will
    increase the combat capability of our controllers. This battle
    management system will reduce engagement times, increase lethality and
    accuracy, and reduce the risk of fratricide. This capability is based
    upon the good ideas of our airmen who have been in combat and
    understand how much a single individual on the battlefield can
    contribute with the right kit.
    Summary
        The airmen of America's Air Force have demonstrated their expertise
    and the value of their contributions to the joint and coalition fight.
    These combat operations are made possible by Air Force investments in
    realistic training and education, superior organization, advanced
    technology, and innovative tactics, techniques, and procedures. In the
    future, our professional airmen will continue to focus advances in
    these and other areas guided by the Air Force CONOPs. Their charter is
    to determine the appropriate capabilities required for joint
    warfighting and to provide maximum effects from, through, and in air
    and space. This structure and associated capabilities-based planning
    will help airmen on their transformational journey, ensuring continued
    operational successes such as those demonstrated in 2003.
               ensuring america's future air and space dominance
        Air Force lethality, mobility, speed, precision, and the ability to
    project U.S. military power around the globe provide combatant
    commanders the capabilities required to meet the Nation's military
    requirements and dominate our enemies. Consistent with the DOD's focus
    on Joint Operating Concepts, we will continue to transform our force--
    meeting the challenges of this era, adapting our forces and people to
    them, and operating our service efficiently. We will adopt service
    concepts and capabilities that support the joint construct and
    capitalize on our core competencies. To sustain our dominance, we
    develop professional airmen, invest in warfighting technology, and
    integrate our people and systems together to produce decisive joint
    warfighting capabilities.
            developing airmen--right people, right place, right time
        At the heart of our combat capability are the professional airmen
    who voluntarily serve the Air Force and our Nation. Our airmen turn
    ideas, tools, tactics, techniques, and procedures into global mobility,
    power projection, and battlespace effects. Our focus for the ongoing
    management and development of Air Force personnel will be to: define,
    renew, develop, and sustain the force.
    Defining our Requirements
        To meet current and future requirements, we need the right people
    in the right specialties. The post-September 11 environment has taxed
    our equipment and our people, particularly those associated with force
    protection, ISR, and the buildup and sustainment of expeditionary
    operations. Our analysis shows that we need to shift manpower to
    stressed career fields to meet the demands of this new steady state,
    and we are in the process of doing this. We have realigned personnel
    into our most stressed specialties and hired additional civilians and
    contractors to free military members to focus on military specific
    duties. We have also made multi-million dollar investments in
    technology to reduce certain manpower requirements. We have redirected
    our training and accession systems and have cross-trained personnel
    from specialties where we are over strength to alleviate stressed
    career fields, supporting the Secretary of Defense's vision of moving
    forces ``from the bureaucracy to the battlefield.''
        Since 2001, we've exceeded our congressionally mandated end
    strength by more than 16,000 personnel. In light of the global war on
    terrorism and OIF, DOD allowed this overage, but now we need to get
    back to our mandated end strength. We are addressing this issue in two
    ways: first, by reducing personnel overages in most skills; and second,
    by shaping the remaining force to meet mission requirements. To reduce
    personnel, we will employ a number of voluntary tools to restructure
    manning levels in Air Force specialties, while adjusting our Active
    Force size to the end strength requirement. As we progress, we will
    evaluate the need to implement additional force shaping steps.
        We are also reviewing our ARC manpower to minimize involuntary
    mobilization of ARC forces for day-to-day, steady state operations
    while ensuring they are prepared to respond in times of crisis. Since
    September 11, 2001, we've mobilized more than 62,000 people in over 100
    units, and many more individual mobilization augmentees. Today, 20
    percent of our AEF packages are comprised of citizen airmen, and
    members of the Guard or Reserve conduct 89 percent of ONE missions. We
    recognize this is a challenge and are taking steps to relieve the
    pressure on the Guard and Reserve.
        In fiscal year 2005, we plan to redistribute forces in a number of
    mission areas among the Reserve and Active components to balance the
    burden on the Reserves. These missions include our Air and Space
    Operations Centers, remotely piloted aircraft systems, Combat Search
    and Rescue, Security Forces, and a number of high demand global
    mobility systems. We are working to increase ARC volunteerism by
    addressing equity of benefits and tour-length flexibility, while
    addressing civilian employer issues. We are also looking at creating
    more full-time positions to reduce our dependency on involuntary
    mobilization.
        We are entering the second year of our agreement to employ Army
    National Guard soldiers for Force Protection at Air Force
    installations, temporarily mitigating our 8,000 personnel shortfall in
    Security Forces. As we do this, we are executing an aggressive plan to
    rapidly burn down the need for Army augmentation and working to
    redesign manpower requirements. Our reduction plan maximizes the use of
    Army volunteers in the second year, and allows for demobilization of
    about one third of the soldiers employed in the first year.
    Future Total Force
        Just as in combat overseas, we are continuing to pursue seamless
    ARC and active duty integration at home, leveraging the capabilities
    and characteristics of each component, while allowing each to retain
    their cultural identity. We continue to explore a variety of
    organizational initiatives to integrate our Active, Guard, and Reserve
    Forces. These efforts are intended to expand mission flexibility,
    create efficiencies in our total force, and prepare for the future.
    Today's future total force team includes a number of blended or
    associate units that are programmed or are in use. The creation of the
    ``blended'' unit, the 116th Air Control Wing at Robins Air Force Base,
    Georgia, elevated integration to the next level. With an initial
    deployment of over 730 personnel, and significant operational
    achievements in OIF, we are now examining opportunities to integrate
    active, Guard, and Reserve units elsewhere in order to produce even
    more measurable benefits, savings, and efficiencies.
        The reasons for this type of integration are compelling. We can
    maximize our warfighting capabilities by integrating Active, Guard, and
    Reserve Forces to optimize the contributions of each component.
    reservists and guardsmen bring with them capabilities they have
    acquired in civilian jobs, leveraging the experience of ARC personnel.
    Integration relieves PERSTEMPO on the Active-Duty Force. Because ARC
    members do not move as often, they provide corporate knowledge,
    stability, and continuity. Finally, integration enhances the retention
    of airmen who decide to leave active service. Because the Guard and
    Reserve are involved in many Air Force missions, we recapture the
    investment we've made by retaining separating active duty members as
    members of the ARC.
    Renewing the Force
        To renew our force, we target our recruitment to ensure a diverse
    force with the talent and drive to be the best airmen in the world's
    greatest Air Force. We will recruit those with the skills most critical
    for our continued success. In fiscal year 2003, our goal was 5,226
    officers and 37,000 enlisted; we exceeded our goal in both categories,
    accessing 5,419 officers and 37,144 enlisted. For fiscal year 2004, we
    plan to access 5,795 officers and 37,000 enlisted.
        In the Air Force, the capabilities we derive from diversity are
    vital to mission excellence and at the core of our strategy to maximize
    our combat capabilities. In this new era, successful military
    operations demand much greater agility, adaptability, and versatility
    to achieve and sustain success. This requires a force comprised of the
    best our Nation has to offer, from every segment of society, trained
    and ready to go. Our focus is building a force that consists of men and
    women who possess keener international insight, foreign language
    proficiency, and wide-ranging cultural acumen. Diversity of life
    experiences, education, culture, and background are essential to help
    us achieve the asymmetric advantage we need to defend America's
    interests wherever threatened. Our strength comes from the collective
    application of our diverse talents, and is a critical component of the
    air and space dominance we enjoy today. We must enthusiastically reach
    out to all segments of society to ensure the Air Force offers a
    welcoming career to the best and brightest of American society,
    regardless of their background. By doing so, we attract people from all
    segments of society and tap into the limitless talents resident in our
    diverse population.
        In addition to a diverse force, we also need the correct talent
    mix. We remain concerned about recruiting health care professionals and
    individuals with technical degrees. To meet our needs, we continue to
    focus our efforts to ensure we attract and retain the right people. We
    will also closely monitor ARC recruitment. Historically, the Air
    National Guard and Air Force Reserve Command access close to 25 percent
    of eligible, separating active duty Air Force members with no break in
    service between their active duty and ARC service.
    Developing the Force
        Over the past year, we implemented a new force development
    construct in order to get the right people in the right job at the
    right time with the right skills, knowledge, and experience. Force
    development combines focused assignments and education and training
    opportunities to prepare our people to meet the mission needs of our
    Air Force. Rather than allowing chance and happenstance to guide an
    airman's experience, we will take a deliberate approach to develop
    officers, enlisted, and civilians throughout our Total Force. Through
    targeted education, training, and mission-related experience, we will
    develop professional airmen into joint force warriors with the skills
    needed across the tactical, operational, and strategic levels of
    conflict. Their mission will be to accomplish the joint mission,
    motivate teams, mentor subordinates, and train their successors.
        A segment of warriors requiring special attention is our cadre of
    space professionals, those that design, build, and operate our space
    systems. As military dependence on space grows, the Air Force continues
    to develop this cadre to meet our Nation's needs. Our Space
    Professional Strategy is the roadmap for developing that cadre. Air
    Force space professionals will develop more in-depth expertise in
    operational and technical space specialties through tailored
    assignments, education, and training. This roadmap will result in a
    team of scientists, engineers, program managers, and operators skilled
    and knowledgeable in developing, acquiring, applying, sustaining, and
    integrating space capabilities.
    Sustaining the Force
        The Air Force is a retention-based force. Because the skill sets of
    our airmen are not easily replaced, we expend considerable effort to
    retain our people, especially those in high-technology fields and those
    in whom we have invested significant education and training. In 2003,
    we reaped the benefits of an aggressive retention program, aided by a
    renewed focus and investment on education and individual development,
    enlistment and retention bonuses, targeted military pay raises, and
    quality of life improvements. Our fiscal year 2003 enlisted retention
    statistics tell the story. Retention for first term airmen stood at 61
    percent, exceeding our goal by 6 percent. Retention for our second term
    and career airmen was also impressive, achieving 73 percent and 95
    percent respectively. Continued investment in people rewards their
    service, provides a suitable standard of living, and enables us to
    attract and retain the professionals we need.
        One of the highlights of our quality of life focus is housing
    investment. Through military construction and housing privatization, we
    are providing quality homes faster than ever before. Over the next 3
    years, the Air Force will renovate or replace more than 40,000 homes
    through privatization. At the same time, we will renovate or replace an
    additional 20,000 homes through military construction. With the
    elimination of out-of-pocket housing expenses, our Air Force members
    and their families now have three great options--local community
    housing, traditional military family housing, and privatized housing.
    Focus On Fitness
        We recognize that without motivated and combat-ready expeditionary
    airmen throughout our total force, our strategies, advanced
    technologies, and integrated capabilities would be much less effective.
    That is why we have renewed our focus on fitness and first-class
    fitness centers. We must be fit to fight. That demands that we reorient
    our culture to make physical and mental fitness part of our daily life
    as airmen. In January 2004, our new fitness program returned to the
    basics of running, sit-ups, and pushups. The program combines our
    fitness guidelines and weight/body fat standards into one program that
    encompasses the total health of an airman.
                           technology-to-warfighting
        The Air Force has established a capabilities-based approach to war
    planning, allowing us to focus investments on those capabilities we
    need to support the joint warfighter. This type of planning focuses on
    capabilities required to accomplish a variety of missions and to
    achieve desired effects against any potential threats. Our
    capabilities-based approach requires us to think in new ways and
    consider combinations of systems that create distinctive capabilities.
    Effects Focus: Capabilities-Based CONOPs
        The Air Force has written six CONOPs that support capabilities-
    based planning and the joint vision of combat operations. The CONOPs
    help analyze the span of joint tasks we may be asked to perform and
    define the effects we can produce. Most important, they help us
    identify the capabilities an expeditionary force will need to
    accomplish its mission, creating a framework that enables us to shape
    our portfolio.

             Homeland Security CONOPs leverages Air Force
            capabilities with joint and interagency efforts to prevent,
            protect, and respond to threats against our homeland--within or
            beyond U.S. territories.
             Space and Command, Control, Communications, Computers,
            Intelligence, Surveillance, and Reconnaissance CONOPs (Space
            and C\4\ISR) harnesses the integration of manned, unmanned, and
            space systems to provide persistent situation awareness and
            executable decision-quality information to the JFC.
             Global Mobility CONOPs provides combatant commanders
            with the planning, command and control, and operations
            capabilities to enable timely and effective projection,
            employment, and sustainment of U.S. power in support of U.S.
            global interests--precision delivery for operational effect.
             Global Strike CONOPs employs joint power-projection
            capabilities to engage anti-access and high-value targets, gain
            access to denied battlespace, and maintain battlespace access
            for required joint/coalition follow-on operations.
             Global Persistent Attack CONOPs provides a spectrum of
            capabilities from major combat to peacekeeping and sustainment
            operations. Global Persistent Attack assumes that once access
            conditions are established (i.e. through Global Strike), there
            will be a need for persistent and sustained operations to
            maintain air, space, and information dominance.
             Nuclear Response CONOPs provides the deterrent
            ``umbrella'' under which conventional forces operate, and, if
            deterrence fails, avails a scalable response.

        This CONOPs approach has resulted in numerous benefits, providing:

             Articulation of operational capabilities that will
            prevail in conflicts and avert technological surprises;
             An operational risk and capabilities-based
            programmatic decisionmaking focus;
             Budgeting guidance to the Air Force Major Commands for
            fulfilling capabilities-based solutions to satisfy warfighter
            requirements;
             Warfighter risk management insights for long-range
            planning.
    Modernization and Recapitalization
        Through capabilities-based planning, the Air Force will continue to
    invest in our core competency of bringing technology to the warfighter
    that will maintain our technical advantage and update our air and space
    capabilities. The Capabilities Review and Risk Assessment (CRRA)
    process guides these efforts. Replacing an outdated threat-based review
    process that focused on platforms versus current and future warfighting
    effects and capabilities, our extensive 2-year assessment identified
    and prioritized critical operational shortfalls we will use to guide
    our investment strategy. These priorities present the most significant
    and immediate Air Force-wide capability objectives.
        We need to field capabilities that allow us to reduce the time
    required to find, fix, track, and target fleeting and mobile targets
    and other hostile forces. One system that addresses this operational
    shortfall is the F/A-22 Raptor. In addition to its contributions to
    obtaining and sustaining air dominance, the F/A-22 will allow all
    weather, stealthy, precision strike 24 hours a day, and will counter
    existing and emerging threats, such as advanced surface-to-air
    missiles, cruise missiles, and time sensitive and emerging targets,
    including mobile targets, that our legacy systems cannot. The F/A-22 is
    in low rate initial production and has begun Phase I of its operational
    testing. It is on track for initial operational capability in 2005. A
    complementary capability is provided by the F-35 Joint Strike Fighter,
    providing sustainable, focused CAS and interservice and coalition
    commonality.
        We also recognize that operational shortfalls exist early in the
    kill chain and are applying technologies to fill those gaps. A robust
    command, control, and sensor portfolio combining both space and
    airborne systems, along with seamless real-time communications, will
    provide additional critical capabilities that address this shortfall
    while supporting the Joint Operational Concept of full spectrum
    dominance. Program definition and risk reduction efforts are moving us
    towards C\4\ISR and battle management capabilities with shorter cycle
    times. The JFC will be able to respond to fleeting opportunities with
    near-real time information and will be able to bring to bear kill-chain
    assets against the enemy. Additionally, in this world of proliferating
    cruise missile technology, our work on improving our C\4\ISR
    capabilities--including airborne Active Electronically Scanned Array or
    AESA radar technology--could pay large dividends, playing a significant
    role in America's defense against these and other threats. To create
    this robust command and control network, we will need a flexible and
    digital multi-service communications capability. We are well on our way
    in defining the architecture to make it a reality. The capabilities we
    are pursuing directly support the Department's transformational system
    of interoperable joint C\4\ISR.
        There is a need for a globally interconnected capability that
    collects, processes, stores, disseminates, and manages information on
    demand to warfighters, policy makers, and support people. The C2
    Constellation, our capstone concept for achieving the integration of
    air and space operations, includes these concepts and the future
    capabilities of the Global Information Grid, Net Centric Enterprise
    Services, Transformational Communications, the Joint Tactical Radio
    System, and airborne Command, Control, and Communication assets, among
    others.
        One of the elements of a sensible strategy to maintain U.S. power
    projection capabilities derives from a global aerial refueling fleet
    that serves Air Force, Navy, Marine Corps, and coalition aircraft. Our
    current fleet of aging tankers met the challenges of OEF and OIF but is
    increasingly expensive to maintain. The fleet averages more then 40
    years of age, and the oldest model, the KC-135E, goes back to the
    Eisenhower administration. Recapitalization for this fleet of over 540
    aerial refueling aircraft will clearly take decades to complete and is
    vital to the foundation and global reach of our Air Force, sister
    services, and coalition partners. The Air Force is committed to an
    acquisition approach for this program that will recapitalize the fleet
    in the most affordable manner possible.
        Capabilities-driven modernization and recapitalization efforts are
    also taking place on our space systems, as we replace constellations of
    satellites and ground systems with next generation capabilities. The
    Evolved Expendable Launch Vehicle has completed six successful
    launches. Using two launch designs, we will continue to seek
    responsive, assured access to space for government systems. Space-Based
    Radar will provide a complementary capability to our portfolio of radar
    and remote sensing systems. We will employ internet protocol networks
    and high-bandwidth lasers in space to transform communications with the
    Transformational Satellite, dramatically increasing connectivity to the
    warfighter. Modernization of GPS and development of the next-generation
    GPS III will enhance navigation capability and increase our resistance
    to jamming. In partnership with NASA and the Department of Commerce, we
    are developing the National Polar-orbiting Operational Environmental
    Satellite System, which offers next-generation meteorological
    capability. Each of these systems supports critical C\4\ISR
    capabilities that give the JFC increased technological and asymmetric
    advantages.
        Space control efforts, enabled by robust space situation awareness,
    will ensure unhampered access to space-based services. Enhanced space
    situation awareness assets will provide the information necessary to
    execute an effective space control strategy. However, we must be
    prepared to deprive an adversary of the benefits of space capabilities
    when American interests and lives are at stake.
        Additional capability does not stem solely from new weapon system
    acquisitions. It results from innovative modernization of our existing
    systems. One example is incorporating a Smart Bomb Rack Assembly and
    the 500-lb. version of the Joint Direct Attack Munition into the
    weapons bay of the B-2. In September 2003, we demonstrated that the B-2
    bomber is now able to release up to 80 separately targeted, GPS-guided
    weapons in a single mission. This kind of innovation reduces the number
    of platforms that must penetrate enemy airspace while holding numerous
    enemy targets at risk. The second order consequences run the gamut from
    maintenance to support aircraft.
        We will also address the deficiencies in our infrastructure through
    modernization and recapitalization. Improvements to our air and space
    systems will be limited without improvements in our foundational
    support systems. Deteriorated airfields, hangars, waterlines,
    electrical networks, and air traffic control approach and landing
    systems are just some of the infrastructure elements needing immediate
    attention. Our investment strategy focuses on three simultaneous steps:
    disposing of excess facilities; sustaining our facilities and
    infrastructure; and establishing a sustainable investment program for
    future modernization of our facilities and infrastructure.
        Finally, we need to continue to modernize and recapitalize our
    information technology infrastructure. To leverage our information
    superiority, the Air Force is pursuing a modernization strategy and
    information technology investments, which target a common network
    infrastructure and employ enterprise services and shared capabilities.
    Science and Technology (S&T)
        Our investment in science and technology has and continues to
    underpin our modernization and recapitalization program. Similar to our
    applied-technology acquisition efforts, the Air Force's capability-
    based focus produces an S&T vision that supports the warfighter.
        The Air Force S&T program fosters development of joint warfighting
    capabilities and integrated technologies, consistent with DOD and
    national priorities. We will provide a long-term, stable investment in
    S&T in areas that will immediately benefit existing systems and in
    transformational technologies that will improve tomorrow's Air Force.
    Many Air Force S&T programs, such as directed energy, hypersonics,
    laser-based communications, and the emerging field of nanotechnology,
    show promise for joint warfighting capabilities. Other technology
    areas, such as miniaturization of space platforms and space proximity
    operations, also show promise in the future. Through developments like
    these, the Air Force S&T program will advance joint warfighting
    capabilities and the Air Force vision of an integrated air and space
    force capable of responsive and decisive global engagement.
    Capabilities-Based Acquisition/Transforming Business Practices
        To achieve our vision of a flexible, responsive, and capabilities-
    based expeditionary force, we are transforming how we conceive, plan,
    develop, acquire, and sustain weapons systems. Our Agile Acquisition
    initiative emphasizes speed and credibility; we must deliver what we
    promise--on time and on budget. Our goal is to deliver affordable,
    sustainable capabilities that meet joint warfighters' operational
    needs.
        We continue to improve our acquisition system--breaking down
    organizational barriers, changing work culture through aggressive
    training, and reforming processes with policies that encourage
    innovation and collaboration. Already, we are:

             Realigning our Program Executive Officers (PEOs). By
            moving our PEOs out of Washington and making them commanders of
            our product centers, we have aligned both acquisition
            accountability and resources under our most experienced general
            officers and acquisition professionals.
             Creating a culture of innovation. Because people drive
            the success of our Agile Acquisition initiatives, we will focus
            on enhanced training. Laying the foundation for change, this
            past year 16,500 Air Force acquisition professionals, and
            hundreds of personnel from other disciplines, attended training
            sessions underscoring the need for collaboration, innovation,
            reasonable risk management, and a sense of urgency in our
            approach.
             Reducing Total Ownership Costs. With strong support
            from the Secretary of Defense, we will expand the Reduction in
            Total Ownership Cost program with a standard model ensuring
            that we have accurate metrics.
             Moving technology from the lab to the warfighter
            quickly. Laboratories must focus on warfighter requirements and
            researchers need to ensure technologies are mature, producible,
            and supportable. Warfighters will work with scientists,
            acquisition experts, and major commands to identify gaps in
            capabilities. With help from Congress, we have matured our
            combat capability document process to fill those gaps. During
            OIF, we approved 37 requests for critically needed systems,
            usually in a matter of days.
             Tailoring acquisition methods for space systems. In
            October 2003, we issued a new acquisition policy for space
            systems that will improve acquisitions by tailoring acquisition
            procedures to the unique demands of space systems.

        Transformation of our business processes is not limited to
    acquisition activities. Our Depot Maintenance Strategy and Master Plan
    calls for financial and infrastructure capitalization to ensure Air
    Force hardware is safe and ready to operate across the threat spectrum.
    Our increased funding for depot facilities and equipment modernization
    in fiscal years 2004-2009, along with public-private partnerships, will
    result in more responsive support to the JFC. We expect to maximize
    production and throughput of weapon systems and commodities that will
    improve mission capability.
        Our logistics transformation initiative will revolutionize
    logistics processes to improve warfighter support and reduce costs. The
    goal of the Air Force's logistics transformation program, Expeditionary
    Logistics for the 21st Century, is to increase weapon system
    availability by 20 percent with zero cost growth. Our current
    initiatives--depot maintenance transformation, purchasing and supply
    chain management, regionalized intermediate repair, and improved
    logistics command and control--will transform the entire logistics
    enterprise.
        Our depots have put some of these initiatives into place with
    exceptional results. In fiscal year 2003, our depot maintenance teams
    were more productive than planned, exceeding aircraft, engine, and
    commodity production goals and reducing flow days in nearly all areas.
    Implementation of ``lean'' production processes, optimized use of the
    existing workforce, and appropriate funding, all contributed to this
    good news story. In addition, our spares support to the warfighter is
    at record high numbers. In 2003, supply rates and cannibalization rates
    achieved their best performance since fiscal year 1994 and fiscal year
    1995, respectively. Fourteen of 20 aircraft design systems improved
    their mission capable rates over the previous year, with Predator
    unmanned aerial vehicles improving by 11 percent, and B-1 bombers
    achieving the best mission capable and supply rates in its history.
    Thanks to proper funding, fleet consolidation, and transformation
    initiatives, spare parts shortages were reduced to the lowest levels
    recorded across the entire fleet.
    Financing the Fight
        An operating strategy is only as good as its financing strategy.
    Similar to acquisition, logistics, and other support processes, our
    finance capabilities are strong. We are taking deliberate and
    aggressive steps to upgrade our financial decision support capability
    and reduce the cost of delivering financial services. Our focus is on
    support to our airmen, strategic resourcing and cost management, and
    information reliability and integration. The initiatives that will get
    us there include self-service web-based pay and personnel customer
    service, seamless e-commerce for our vendor payment environment,
    budgets that link planning, programming, and execution to capabilities
    and performance, financial statements that produce clean audit opinions
    while providing reliable financial and management information, and
    innovative financing strategies.
                             integrating operations
        The Air Force excels at providing communications, intelligence, air
    mobility, precision strike, and space capabilities that enable joint
    operations. Our airmen integrate these and other capabilities into a
    cohesive system that creates war-winning effects. Integration takes
    place at three levels. At the joint strategic level, integration occurs
    between interagencies and the coalition. Integration also takes place
    within the Air Force at an organizational level. At its most basic
    level, integration takes place at the machine-to-machine level to
    achieve universal information sharing which facilitates true
    integration at every level.
    Integrating Joint, Coalition, and Interagency Operations
        The ever-changing dynamics of global events will drive the need to
    integrate DOD and interagency capabilities and, in most cases, those of
    our coalition partners. Joint solutions are required to produce
    warfighting effects with the speed that the global war on terrorism
    demands. Fully integrated operations employ only the right forces and
    capabilities necessary to achieve an objective in the most efficient
    manner. We must also integrate space capabilities for national
    intelligence and warfighting.
        We are pursuing adaptations of our C2 organizations and
    capabilities to support this vision. While the Air Force's global C2
    structure has remained relatively constant, throughout our 57-year
    history, the demands of a changing geopolitical environment have
    stressed current C2 elements beyond their design limits.
        We have conducted an extensive review of our C2 structures to
    support the National Security Strategy objectives of assure, dissuade,
    deter, and defeat as well as the SECDEF's Unified Command Plan. We will
    enhance our support for the JFC and our expeditionary posture through a
    new Warfighting Headquarters Construct. This will enable the Numbered
    Air Forces to support unified combatant commanders in a habitual
    supported-supporting relationship. Working with their strategy and
    planning cells on a daily basis will ensure that Air Force capabilities
    are available to the JFC's warfighting staff. This new headquarters
    will provide the Combined Air Operations Center (CAOC) with sufficient
    staff to focus on planning and employment of air, space, and
    information operations throughout the theater.
        We are also adapting the capabilities of our CAOCs. The CAOCs of
    each headquarters will be interconnected with the theater CAOCs, all
    operating 24 hours a day, 7 days a week. They will be operated as a
    weapons system, certified and standardized, and have cognizance of the
    entire air and space picture. This reorganization will increase our
    ability to support our combatant commanders, reduce redundancies, and
    deliver precise effects to the warfighters. As we near completion of
    the concept development, we will work with the Secretary of Defense and
    Congress to implement a more streamlined and responsive C2 component
    for the combatant commanders and national leadership.
        Integrated operations also depend on integrated training. We
    continue to advance joint and combined interoperability training with
    our sister services and the nations with which we participate in global
    operations. The Joint National Training Capability (JNTC) will improve
    our opportunities for joint training. The aim of the JNTC is to improve
    each service's ability to work with other services at the tactical
    level and to improve joint planning and execution at the operational
    and strategic levels. The Air Force has integrated live, virtual, and
    constructive training environments into a single training realm using a
    distributed mission operations (DMO) capability. JNTC will use this DMO
    capability to tie live training events with virtual (man-in-the-loop)
    play and constructive simulations. Live training in 2004--on our ranges
    during four Service-conducted major training events--will benefit from
    improved instrumentation and links to other ranges as well as the
    ability to supplement live training with virtual or constructive
    options. These types of integrated training operations reduce overall
    costs to the services while providing us yet another avenue to train
    like we fight.
    Integrating Within the Air Force
        The Air Force is continuing to strengthen and refine our AEF. The
    AEF enables rapid build-up and redeployment of air and space power
    without a lapse in the Air Force's ability to support a combatant
    commander's operations. The Air Force provides forces to Combatant
    Commanders according the AEF Presence Policy (AEFPP), the Air Force
    portion of DOD's Joint Presence Policy. There are ten AEFs, and each
    AEF provides a portfolio of capabilities and force modules. At any
    given time, two AEFs are postured to immediately provide these
    capabilities. The other eight are in various stages of rest, training,
    spin-up, or standby. The AEF is how the Air Force organizes, trains,
    equips, and sustains responsive air and space forces to meet defense
    strategy requirements outlined in the Strategic Planning Guidance.
        Within the AEF, Air Force forces are organized and presented to
    combatant commanders as Air and Space Expeditionary Task Forces
    (AETFs). They are sized to meet the combatant commander's requirements
    and may be provided in one of three forms: as an Air Expeditionary Wing
    (AEW), Group (AEG), and/or Squadron (AES). An AETF may consist of a
    single AEW or AEG, or may consist of multiple AEWs or AEGs and/or as a
    Numbered Expeditionary Air Force. AETFs provide the functional
    capabilities (weapon systems, expeditionary combat support and command
    and control) to achieve desired effects in an integrated joint
    operational environment.
        One of our distinctive Air Force capabilities is Agile Combat
    Support (ACS.) To provide this capability, our expeditionary combat
    support forces--medics, logisticians, engineers, communicators,
    Security Forces, Services, and Contracting, among several others--
    provide a base support system that is highly mobile, flexible, and
    fully integrated with air and space operations. ACS ensures responsive
    expeditionary support to joint operations is achievable within resource
    constraints--from creation of operating locations to provision of
    right-sized forces. An example of this capability is the 86th
    Contingency Response Group (CRG) at Ramstein Air Base, organized,
    trained, and equipped to provide an initial ``Open the Base'' force
    module to meet combatant commander requirements. The CRG provides a
    rapid response team to assess operating location suitability and
    defines combat support capabilities needed to establish air
    expeditionary force operating locations.
        Another example of ACS capability is the light and lean
    Expeditionary Medical System (EMEDS) that provides the U.S. military's
    farthest forward care and surgical capability. Air Force medics jump
    into the fight alongside the very first combatants. Whether supporting
    the opening of an air base or performing life saving surgeries, these
    medics bring an extraordinary capability. They carry backpacks with
    reinforced medical equipment, permitting them to perform medical
    operations within minutes of their boots hitting the ground.
    Complementing this expeditionary medical capability is our air
    evacuation system that provides the lifeline for those injured
    personnel not able to return to duty. The other services and our allies
    benefited greatly from this capability in OEF and OIF. The Army and
    Navy are now developing a similar light and lean capability. The
    success of EMEDS is also apparent in the reduction of disease and non-
    battle injuries--the lowest ever in combat.
    Horizontal Machine-to-Machine Integration
        We also strive to increasingly integrate operations at the most
    basic level--electron to electron. Victory belongs to those who can
    collect intelligence, communicate information, and bring capabilities
    to bear first. Executing these complex tasks with accuracy, speed, and
    power requires assured access and the seamless, horizontal integration
    of systems, activities and expertise across all manned, unmanned, and
    space capabilities. Such integration will dramatically shorten the kill
    chain.
        Machine-to-machine integration means giving the warfighter the
    right information at the right time. It facilitates the exchange of
    large amounts of information, providing every machine the information
    it needs about the battlespace and an ability to share that
    information. In the future, we will significantly reduce the persistent
    challenges of having different perspectives or pictures of the
    battlefield. Examples would be to ensure that the A-10 could see the
    same target as the Predator or to guarantee that the F-15 has the same
    intelligence about enemy radars as the Rivet Joint.
        We want a system where information is made available and delivered
    without regard to the source of the information, who analyzed the
    information, or who disseminated the information. It is the end product
    that is important, not the fingers that touch it. The culmination of
    the effort is the cursor over the target. It is an effect we seek, and
    what we will provide.
        The warfighters' future success will depend on Predictive
    Battlespace Awareness (PBA). PBA relies on in-depth study of an
    adversary before hostilities begin in order to anticipate his actions
    to the maximum extent possible. We can then analyze information to
    assess current conditions, exploit opportunities, anticipate future
    actions, and act with a degree of speed and certainty unmatched by our
    adversaries. PBA also relies on the ability of air and space systems to
    integrate information at the machine-to-machine level and produce high-
    fidelity intelligence that results in a cursor over the target. The
    result--integrated operations--is our unique ability to conduct PBA and
    impact the target at the time and place of our choosing. This machine-
    to-machine integration will include a constellation of sensors that
    create a network of information providing joint warfighters the
    information and continuity to see first, understand first, and act
    first.
        The C2 Constellation is the Air Force capstone concept for
    achieving the integration of air and space operations. Our vision of
    the C2 Constellation is a robust, protected network infrastructure, a
    globally based command and control system to encompass all levels of
    the battle and allow machines to do the integration and fusion. It uses
    Battle Management Command and Control & Connectivity and consists of
    command centers, sensors, and systems like the U-2, Space Based Radar,
    the Distributed Common Ground System, and our CAOCs. Given the C2
    Constellation's complexity, the Air Force recognizes the need for an
    architecture to address myriad integration issues--methodically--so all
    elements work in concert.
                        securing america's next horizon
        Armed with the heritage of air and space power in combat, the
    lessons learned from our most recent conflicts, and the powerful
    advances in technology in the 21st century, we stand ready to deliver
    decisive air and space power in support of our Nation. Whether called
    to execute a commanding show of force, to enable the joint fight, to
    deliver humanitarian assistance, or to protect our Nation from the
    scourge of terrorism, we will deliver the effects required. Our ability
    to consistently answer the call is our dividend to the Nation, a result
    of our sustained investment in people, technology, and integration.
        Our portfolio of advantages provides dividends on the battlefield.
    We bring to bear a diversified collection of capabilities, which answer
    the needs of a spectrum of combat and humanitarian operations. As one
    would with any investment, we will monitor, maintain, and adjust our
    investments as needed to reflect the demands of a dynamic environment.
    Transformational initiatives in the way we organize, train, and equip
    reflect such adjustments, changes that will result in significant gains
    for our force, for the joint team, and for our Nation. Yet, we will not
    shift our focus from the core competencies that have provided the
    foundation for our success and continue to do so. The success of the
    Air Force resides in the airmen who employ the technology of
    warfighting through integrated operations with our joint and coalition
    partners. This is our heritage and our future. This is America's Air
    Force.

        Senator McCain [presiding]. Senator Levin.
        Senator Levin. Thank you, Mr. Chairman.
        Secretary England, relative to our deployments to Haiti, I
    understand now that the lead element of the stability force
    could grow up to 2,000 American troops and could stay up to 3
    months. What is the mission? How many marines and other
    military personnel will we send? Do you expect marines to
    remain in Haiti after a U.N. peacekeeping force deploys?
        Secretary England. Senator, today we have 370 marines
    deployed, who are actually in Haiti this morning, the latest
    number. We still have marines going to Haiti. Understand
    initially we will have about 900 marines in Haiti. It could be
    more, but I think that all depends--my understanding on what
    our support is from other countries. Of course, we do have
    support from about five other countries, as of yesterday, that
    I was aware of: Canada, France, a couple of other countries
    here in the hemisphere. So I believe we need to see what
    happens here in the next days and weeks, but this should
    stabilize within the next 90 days, and our marines will be back
    in Camp Lejeune. But, obviously, it depends on how things work
    out and the kind of support we have from our friends and
    allies. But, it does seem to be coming together.
        The last report I had, just looking at the news this
    morning, at least where our marines are deployed things seem to
    be quieter, so hopefully we'll have a stable situation. This is
    a peacekeeping force. I hope we'll have stable situation
    shortly.
        Senator Levin. The hope is that they'll be back in 90 days?
        Secretary England. Yes, sir, that's our expectation.
        Senator Levin. In my opening statement, I talked about the
    adequacy of our funding and apparently the lack of a decision
    of the administration not to request a 2005 supplemental during
    this calendar year. The problem is that the budget that's
    before us represents a peacetime budget, and it just doesn't
    pay for incremental costs of operations in Iraq and
    Afghanistan. When the Chiefs of Staff of the Army and Air
    Force, the Chief of Naval Operations, and the Commandant of the
    Marine Corps, were in front of us, they all testified to a
    cash-flow difficulty that they're going to face if the Defense
    Department does not submit a fiscal year 2005 supplemental
    funding request to Congress during this calendar year. I'm
    wondering whether or not you share those concerns that were
    expressed to us.
        First, Secretary Brownlee, do you share those concerns that
    unless we have a supplemental for 2005 filed with us this year,
    that we're going to have some cash-flow problems?
        Secretary Brownlee. Sir, we're certainly concerned,
    because, as you indicated earlier what our burn rate is, out of
    the $65.1 billion that Congress provided for supplemental
    appropriations for fiscal year 2004, the Army received roughly
    40 of that. So by moving some funds within the Army, and
    relying on some assistance from OSD, we believe we can get to
    the end of fiscal year 2004. When the fiscal year 2005 budget
    is approved, we will have some limited ability to cash-flow out
    of that. Again, with assistance from the administration, we
    believe we could get to sometime early next spring before we
    would get into trouble.
        Senator Levin. So you believe that without a supplemental
    for 2005 adopted this calendar year, that you're going to be
    okay through the spring of 2005?
        Secretary Brownlee. In conferring with OSD and looking
    within the Army at what we have, and our current level of
    spending, we believe we can get there, sir.
        Senator Levin. Secretary England.
        Secretary England. Well, Senator, the Department of the
    Navy--our deployments are in our base budget. If you'll notice,
    for example, the war supplemental, I mean, we draw down
    relatively small funds from the war supplemental because we
    fund our ongoing operation as part of our base budget. So all
    the deployment of our ships, our sailors and marines, we were
    forward-deployed every day, 24/7. That's accounted for in our
    base budget.
        Senator Levin. Is the rotation of the marines accounted
    for?
        Secretary England. It is--the marines that are going
    overseas now are not accounted for, so we do have a marginal
    cost there. That marginal cost, we are working with OSD, we do
    expect to be funded. That's out of the fiscal year 2004
    supplemental; that's out of the Operation Iraqi Freedom fund.
    So we do not see a problem with that deployment. Now, if we
    have deployments next year, that's another issue.
        But, nonetheless, for the Department of Navy, it's a
    relatively small amount of money. Of course, the CNO already
    testified it was not an issue with him.
        I, frankly, believe that the Marine Corps costs, we can
    accommodate out of our total budget. A lot of the Marine Corps
    funding, of course, comes out of the Navy side of the budget,
    not the Marine Corps side of the budget.
        Senator Levin. I'm wondering, going back to you, Secretary
    Brownlee, whether or not you are familiar with General
    Schoomaker's testimony----
        Secretary Brownlee. Yes, sir, I am.
        Senator Levin.--because he said that the fact that the Army
    operation in Iraq was only funded until the end of September
    created a real concern as to how to bridge from the end of this
    fiscal year until the time when supplemental funding is
    available. He said he just didn't have any answer----
        Secretary Brownlee. Yes, sir.
        Senator Levin.--where he's going to get the funding. You
    apparently do have an answer to that.
        Secretary Brownlee. Sir, if you look just at the funds that
    have been provided to the Army today, he's certainly right.
    What I said was that, assuming that we will get additional
    assistance from the administration, from OSD, they have----
        Senator Levin. Additional to what?
        Secretary Brownlee. Sir, OSD can move monies and provide
    additional assistance to us also from other services. They have
    transfer accounts. They have other monies there.
        Senator Levin. Are you talking about----
        Secretary Brownlee. I am assured by them that, with their
    assistance, we can make it, in accordance with the way I laid
    it out. Now, what General Schoomaker was looking at was
    strictly those funds that have been provided today in the
    fiscal year 2004 budget for the Army, plus the supplemental
    funds that we have received to date. He's right about that. We
    would probably run out in 2004. We would probably need some
    assistance, quite frankly, from OSD to get to 2004 with some of
    the other things that we're planning to do.
        Senator Levin. Well, he was talking about the bridge
    between the end of this fiscal year to the time when the 2005
    supplemental is adopted----
        Secretary Brownlee. Well----
        Senator Levin.--because there's no provision in the 2005
    budget for these incremental costs. So the question is----
        Secretary Brownlee. Yes, sir. What I indicated was that,
    presuming the fiscal year 2005 budget was passed, and we got
    our share of that, we would have some limited capability to
    cash-flow funds out of third- and fourth-quarter funds early;
    and with some additional assistance from the administration, we
    could probably make it through this--I don't know--somewhere
    around this time next year, maybe the end of March--how much
    assistance we would get, but I've----
        Senator Levin. You have----
        Secretary Brownlee.--in conferring with OSD, that's what
    they've told us--that they have--can release additional funds
    to us.
        Senator Levin. You've gotten that assurance from OSD?
        Secretary Brownlee. I have conferred with them, and that's
    what they've told me, sir, that they would----
        Senator Levin. Thank you.
        My time is up. Thank you, Mr. Chairman.
        Senator McCain. Thank you, Senator Levin.
        Secretary Roche, when does the Air Force anticipate making
    a decision concerning the lease/purchase of the tankers?
        Secretary Roche. Senator, we would expect that the
    inquiries that the Secretary of Defense has asked to be put in
    place, which include, clearly, the Inspector General's review
    of any illegalities, which also include a Defense Science Board
    review, from scratch, of the tanker recapitalization to be
    done, plus one or two other things, that when those are
    finished, then we'll make that decision. I don't know an exact
    date. It's months from now.
        Senator McCain. The defense authorization bill required the
    conduct of an analysis of alternatives. Are you aware of that?
        Secretary Roche. Yes, sir.
        Senator McCain. Would you anticipate making that decision
    before the analysis of alternatives is completed?
        Secretary Roche. The way the analysis of alternatives is
    structured, Senator, is that it assumes that there was the
    NDAA-approved lease. An 80 purchase out of a 100, and then the
    analysis of alternatives picks up from that point forward. If,
    on the other hand----
        Senator McCain. Right, you assume that.
        Secretary Roche. Yes, sir----
        Senator McCain. Why would----
        Secretary Roche.--the people----
        Senator McCain.--why would you assume that----
        Secretary Roche. Because----
        Senator McCain.--Mr. Secretary, when the language of the
    legislation says--just calls for an analysis of alternatives?
        Secretary Roche. Senator, as I understand, and I've talked
    to Mike Wynne and others about this, it picks up that period.
    However, if there is continued delay, the work that would be
    done in that analysis of alternatives would always--would also
    inform the basic initial purchase, as well if we stayed to the
    KC-X program, if we don't lease. You'll recall, sir, the lease
    was a way to accelerate procurement, that all along we have
    been planning monies in the regular program, for a KC-X
    program. If any one of the committees objected, we would stick
    with that plan. This NDAA directed analysis of alternatives
    would also substitute for the analysis of alternatives that
    would be done as part of the KC-X program.
        Senator McCain. Well, of course, e-mails that we receive
    from Boeing clearly indicated that you intended to lease as
    many as 300 tanker aircraft----
        Secretary Roche. No, sir. With all due respect, sir, I
    never, ever used a number greater than 100, because only the
    number 100 was used in the fiscal year 2002 appropriations act.
    Others used other numbers; I cut Boeing off in any
    conversations of anything above 100.
        Senator McCain. That's not what the e-mails indicate, but
    we'll--hopefully we'll get to the bottom of that sooner or
    later.
        Now, who's going to conduct the analysis of alternatives?
        Secretary Roche. It hasn't been determined yet, sir. It'll
    be one of the Federally-Funded Research and Development Centers
    (FFRDCs), or it will be determined by the OSD as to who
    conducts it. I'm not sure who they will choose.
        Senator McCain. So they haven't even begun the analysis of
    alternatives.
        Secretary Roche. They haven't begun the analysis of
    alternatives. Quite separately, we have had the Rand
    Corporation doing work, which is precursor to analysis of
    alternatives, but it's not clear that OSD will choose Rand to
    be the----
        Senator McCain. But you've had the Rand Corporation do the
    precursor, the same----
        Secretary Roche. That was for our own information.
        Senator McCain.--the same corporation that got $30 million
    for Project Air Force last year, and will get $25 million again
    this year.
        Secretary Roche. But that's precursor for the Air Force,
    Senator. The OSD will choose which organization will do the
    analysis of alternatives, as required by the NDAA.
        Senator McCain. Well, in a Boeing briefing to the Board of
    Directors, on--June 2002, ``Element operational requirement
    document (ORD) objective: Establish clearly defined
    requirements in ORD for the USAF tanker configuration that
    results in an affordable solution that meets the USAF mission
    needs and will prevent an AOA from being conducted.'' You never
    heard any information that the Boeing Corporation wanted to
    prevent an analysis of alternatives.
        Secretary Roche. No, sir. I never discussed that with them.
    As I've told you once before, I did have a discussion with the
    Deputy Secretary of Defense in the presence of the other
    service secretaries, service chiefs, people from OSD, as to
    whether or not an analysis of alternatives was required for the
    tanker lease. I argued at that time that given the subject
    matter, that one was not; and it was agreed to at that time. I
    testified to that effect to you, I believe, last year, sir.
        Senator McCain. You, of course, don't recall you telling
    the Boeing lobbyists to--a meeting with the Boeing lobbyists
    where you told them to put pressure on Mr. Wynne on the
    tanker----
        Secretary Roche. Senator, thank you----
        Senator McCain.--deal----
        Secretary Roche.--for the question, Senator.
        Senator McCain. Let me finish my question.
        Secretary Roche. If I may answer----
        Senator McCain. Can I finish the question?
        Secretary Roche.--the question--may I answer the question?
        Senator McCain. Can I finish the question----
        Secretary Roche. Oh, I'm sorry.
        Senator McCain.--Mr. Secretary?
        Secretary Roche. I'm sorry.
        Senator McCain. Thank you. In that and other e-mails that
    we got from Boeing, you met with the lobbyists from Boeing and
    said, ``You have to put pressure on Mr. Wynne in order to get
    this deal expedited.'' That clearly does not indicate that you
    had some support for analysis of alternatives. But last time
    you testified--and let me finish my question--you didn't recall
    that meeting with the Boeing lobbyists.
        Secretary Roche. Yes, sir. The reason was, you gave a name
    of a person, and it happened to be the same name of the program
    manager of our F/A-22 program, so it was very confusing. I
    then, at the time, asked you if you would read some of the
    introductory paragraphs so I could fix the letter in my mind,
    and, in fact, we may have a difference in what we were looking
    at. This is an issue that occurs after OSD-Program Analysis and
    Evaluation (PA&E) sends a letter on a Friday night to me
    objecting to the language in a report--in a report--that I
    would be doing for Congress. This was done a month after the
    lease has been approved, and a month after the lease has been
    announced. At that time, the person--who has never met me
    before--uses the word ``pressure,'' but it doesn't make sense,
    because the lease has already been approved--the lease has
    already been publicly announced. The concern, and my upset, was
    the fact that it appeared there was a rear-guard action going
    on against my cover letter bringing the matter to the point of
    Congress. I've told you there was no pressure; Mr. Wynne has
    told you there was no pressure, and, Senator, I believe if
    you'll read a few lines down that same e-mail, the individual
    reports that there would be a meeting that afternoon--this is a
    Monday--that afternoon.
        Further, if I may answer, sir, this was not a lobbyist, nor
    did I call him in. This meeting had been scheduled weeks in
    advance, and the individual was the head of all of the military
    programs in the Boeing company, and we discussed other
    programs, as well. By the way, the matter of concern was
    resolved by 4 o'clock that afternoon.
        Senator McCain. Well, I have never heard of a Secretary of
    the Air Force calling in a lobbyist to tell him to ``put
    pressure on''----
        Secretary Roche. Senator, I did not call----
        Senator McCain. That's an e-mail----
        Secretary Roche.--I did not call in a lobbyist, Senator.
        Senator McCain. That's an e-mail.
        Secretary Roche. Please--please, I'm trying to answer that.
    I did not call in any lobbyists. The meeting you're referring
    to is a meeting with a line executive. He was not called in.
    The meeting had been scheduled well in advance. I did not ask
    him to put on pressure. Senator, the subject matter was my
    report that I would sign or not sign, not the lease itself.
    It----
        Senator McCain. Obviously----
        Secretary Roche.--all occurred months earlier.
        Senator McCain. Obviously, your testimony is in direct
    contradiction to the e-mails that we received. If you would be
    forthcoming with the e-mails that you used, and other members
    of the Air Force, during the conduct of this investigation--and
    your steadfast refusal to do so indicates that everything is
    not going to be cleared up until such time as we find out all
    information. There is more than--and I think the Defense
    Inspector General's report will have some very interesting
    things involved in it.
        The ORD--is my time up? My time has expired, Mr. Secretary,
    but I want to repeat again, I've never seen, in 22 years in the
    United States Navy and now 22 years in Congress, anything like
    the deal that you tried to pull off. We will continue to try to
    save the taxpayers $5 billion or $6 billion, which would have
    happened if we hadn't had the right kind of intervention and
    the right kind of information, because you were greasing the
    skids with the Boeing Aircraft Corporation, and Boeing has
    taken appropriate action by relieving their chief executive
    officer and CFO of their responsibilities. Unfortunately, we
    haven't seen a single thing done by the United States Air Force
    to correct this kind of situation, which evolved in a most
    scandalous fashion.
        Secretary Roche. Senator, you know that I respectfully
    disagree with your characterization of that, that I was trying
    to get a more rapid acquisition of tankers, that I believe
    everything was done in accordance with the fiscal year 2002
    Appropriations Act, that everything was done by the book, as
    best as I could tell. I did not call in lobbyists. I never have
    for the companies. I certainly did not tell them to pressure
    anybody. The pressure--under the circumstances, the date of--if
    you look at the date of the e-mail, Senator, it makes no sense
    having to do with the lease. The issue had to do with a letter,
    a critique of my draft report to Congress.
        Senator McCain. Well, obviously, we will let others judge
    the facts.
        Secretary Roche. Yes, sir.
        Senator McCain. Again, it's very unfortunate, particularly
    in light of all the investigations that are going on, that you
    and the Secretary of Defense will not allow the Senate Armed
    Services Committee to exercise its oversight duties by having
    access to all communications, which, by the way, I'm sure are a
    standard form that you signed when you--when your nomination
    was submitted to this committee for your confirmation as
    Secretary of the Air Force, which says, as we showed Mr. Wynne,
    that you will make available to the committee all
    communications, as requested.
        But, as I think you may know, Mr. Secretary, we won't quit,
    and there's lots more to come.
        Thank you, Mr. Chairman.
        Chairman Warner [presiding]. I've been working with Senator
    McCain on this issue, with the Secretary of Defense, and I'm
    hopeful that we can reconcile this issue, because right now
    exercising the rights under--that this Senator has in the
    Senate, all civilian nominees for the Department of Defense are
    in abeyance by floor action. That's your right, and that sends
    a very strong signal as to the support Senator McCain has to
    establish the rights of co-equal branches of the government to
    perform their respective work. So it may well be above your pay
    grade, Mr. Secretary, but we simply have to resolve this issue.
        Senator Akaka.
        Senator Akaka. Thank you very much, Mr. Chairman.
        It's good to have you here this morning. I wanted you to
    know that I am, and we are, proud of our soldiers, our sailors,
    our marines, and our airmen for what they're doing for our
    country. Personally, I would like to do all I can to support
    our troops.
        This is a question for all of you. I want to follow up on
    discussions you were having earlier with Senator Levin. You
    were talking about funding shortfalls for the remainder of
    fiscal year 2004. Secretary Brownlee, Army officials have cited
    unfunded requirements of up to $10 billion for this year, which
    you suggested OSD might be able to help you with, perhaps by
    moving funds from other services. However, press reports note
    that the Departments of the Navy and Air Force may have
    shortfalls of $1.6 billion and $375 million, respectfully. I
    have two questions here. Would each of you please tell me how
    much your Department expects to seek, during the upcoming mid-
    year review; and if you do not receive these funds, the second
    part is, what actions will you take to continue conducting
    operations for the rest of the fiscal year?
        Secretary Brownlee, I want you to know we had a good Army
    Caucus meeting this morning, and it was filled with standing-
    room only, and we heard from the Chief. We had a good exchange,
    and look forward to more of that in the future. Will you start,
    Secretary Brownlee?
        Secretary Brownlee. Yes, sir. Sir, we are still putting
    together what we're going to ask for in the mid-year review,
    and I'd be happy to provide that for the record, but we are
    just not complete in putting that together.
        I can tell you that I've consulted OSD, requesting
    assistance with some of the actions we've taken to accelerate
    the production of up-armored HMMWVs and body armor. We still do
    have some capability within the Army to reprogram funds and
    move those around, and we will intend to do that where we can.
    But I have conferred with people in the OSD comptroller's shop,
    and they assure me that they will help us; and to what extent,
    I can't tell you right now. But I have gone to them with this
    situation, and they have assured me that they are capable of
    providing assistance. Some of it, I'm sure we're going to have
    to find ways to do ourselves, and we will. Whether or not there
    will be a significant shortfall from that, I think we'll know
    better after the mid-year review.
        Senator Akaka. Secretary Brownlee, I and some of my
    colleagues visited some of the troops who were wounded and
    injured, and I tell you that we're so happy to know that the
    body armor that they now have has saved many of their lives.
        Secretary Brownlee. Yes, sir.
        Senator Akaka. Are there any other improvements to the body
    armor that are being planned? I say that because many of them
    had limb problems and leg problems.
        Secretary Brownlee. Sir, could we talk about that in a
    different session?
        Senator Akaka. Surely.
        Secretary Brownlee. I do not want to talk about the
    capabilities of our body armor and what it might or might not
    be able to do.
        Senator Akaka. All right, thank you.
        Secretary England.
        Secretary England. Senator, the $1.6 billion you referred
    to in the press, that was reported--quoted a letter from the
    Navy comptroller to the DOD comptroller, Mr. Zakheim--a request
    in that general amount of $1.6 billion. That $1.6 billion is to
    cover the incremental cost, fiscal year 2004, sending our
    marines to Iraq, so it's the cost of being there, plus special
    equipment, armoring for their vehicles, special equipment. We
    have, frankly, told the Marine Corps, anything they need we
    will fund and provide to them, and so we are evaluating a lot
    of new capability.
        I thank the Army, because a lot of the lessons learned in
    working with them--our marines have physically been with the
    Army many, many months--lessons learned to apply when our
    marines deploy. Those funds, we are working with OSD, we have
    received some of that money from OSD. Some things we wanted to
    do right away, so we did our own reprogramming to provide some
    money right away, because we did not want any time lags,
    because the marines are going quickly.
        So we do not have an issue here. I mean, it's a relatively
    modest amount of money within our total budget. We are getting
    help from OSD, and we do have some flexibilities within the
    budget. So those bills are being paid. That is our fiscal year
    2004. There is the Iraqi Freedom fund, which was the fiscal
    year 2004 supplemental, that is available, because we are
    substituting--as you'll recall, Army was originally going to be
    going, and we are substituting for some of the Army personnel,
    right? Marines are taking Army personnel, in terms of 82nd
    Airborne. So some of that funding that was going for that total
    effort with the Army will now come to the United States Marine
    Corps. So this is not an issue for us, sir.
        Secretary Roche. Senator, in fiscal year 2004, the Air
    Force should be able to make it without a problem, assuming
    there are no new contingencies and assuming the source of money
    that OSD supposedly has for the Army does not come from the Air
    Force. It could be a matter of robbing Peter to pay Paul. But
    assuming none of that, we should be able to make 2004 fine.
        Senator Akaka. Mr. Chairman, my time has expired.
        Thank you, Mr. Chairman.
        Chairman Warner. Senator Inhofe.
        Senator Inhofe. Yes. I wonder, Secretary----
        Chairman Warner. I would ask forbearance if the ranking
    member wants----
        Senator Levin. If you would forebear.
        Senator Inhofe. Certainly.
        Senator Levin. I do appreciate that. I just want to get
    back in this question of documents on the Boeing lease just for
    1 minute.
        Transcending the issues involved in the Boeing lease is the
    question of whether or not Congress has a right to documents.
    This is a very fundamental issue. Frankly, the Defense
    Department has been kicking this can down the road and raising
    the argument that somehow or other we may not be entitled to
    so-called pre-decisional documents.
        There's no basis in law for the Department of Defense
    denying Congress predecisional documents. The only legal basis
    for denying us documents is executive privilege, which
    obviously is not involved here and not being asserted here.
        Now, we had Mr. Wynne in front of us. He said that was
    above his pay grade. Then we had the Secretary of Defense in
    front of us, and he said something like, ``It's still being
    considered.'' I just talked to the chairman and Senator McCain,
    and I think we have a responsibility, frankly, representing the
    Senate here, as just a committee of the Senate, in insisting on
    these documents, and, if necessary, getting the Secretary of
    Defense or the General Counsel of the Defense Department here
    in front of us to answer this, because there is no way that a
    self-respecting Congress cannot insist upon these documents,
    unless there's an executive privilege issue. It's got nothing
    to do with the issues involved in the Boeing case. It's
    separate and apart from those issues.
        So, Mr. Chairman, you have plenty on your plate, I know.
    But, nonetheless, this request of Senator McCain is really a
    request that relates to the powers of this body to oversee the
    operations of the Department of Defense. If this were a Freedom
    of Information Act (FOIA) request, then the predecisional issue
    is relevant. This isn't a FOIA issue; this is an oversight
    issue on the part of Congress.
        So, Mr. Chairman, I would support Senator McCain in really
    insisting that we get the documents, but get an answer, so that
    if the answer is going to continue to be no, that then I think
    this becomes a leadership issue of the whole Senate. The Senate
    will decide whether we can accept a stonewalling on this kind
    of a request from an executive branch. I don't care if the
    executive branch is Democratic or Republican. This goes beyond
    any political issue. It's got nothing to do with the merits of
    this issue. It has to do with the institutional question of
    obtaining documents, which are not subject to executive
    privilege.
        Chairman Warner. That's clear, very much, Senator. I've
    been trying to work with Senator McCain on this. So I think you
    see a unified front. Gentlemen, this is, of course, at the
    Secretary's level, but I think it's helpful to communicate, in
    this type of forum, the sincerity and the commitment of this
    committee, because we are a coequal branch of government, and
    we have our functions to perform, and it's essential that we
    have the appropriate documents to do our oversight.
        So we'll proceed now. Thank you for your indulgence,
    Senator Inhofe.
        Senator Inhofe. Yes.
        Senator Levin. Thank you, Senator.
        Senator Inhofe. Thank you, Mr. Chairman and Senator Levin.
    I know, Secretary Brownlee, you're unable to respond fully to
    Senator Akaka's question, but I would like to have you repeat
    something that General Schoomaker said this morning at the Army
    Caucus, and that I believe you said, but I want to re-emphasize
    that----
        Secretary Brownlee. Yes, sir.
        Senator Inhofe.--because there is media here, and I want
    everyone to hear it. That is that every troop in Iraq and
    Afghanistan, in terms of body armor, how are they equipped?
        Secretary Brownlee. Has body armor. Sir, as of yesterday
    afternoon, there were some additional combat service support
    troops in Afghanistan, to the tune of about 2,700, that I
    understand did not have interceptor body armor. Now, that
    doesn't mean there's not enough in Central Command to outfit
    everybody. There is. But they have to get it to these people,
    and----
        Senator Inhofe. But the point the General is making, if we
    hadn't taken action, it would take some 20 years, at the rate
    that we were going, to get adequate body armor to these
    troops----
        Secretary Brownlee. That's true.
        Senator Inhofe.--which are now going to take----
        Secretary Brownlee. Yes, sir. We now have more than enough
    in theater to equip every soldier. It's a matter of
    distribution within the theater, sir.
        Senator Inhofe. Okay. As all of you know, we've talked
    about the President's budget, and there is, right now, some
    talk about another $9 billion cut--up to, I think, to be fair
    with them. If this were to take place, it would be up to around
    $3 billion for each branch that you represent here today--can
    you tell us where that would come from?
        Secretary Brownlee. No, sir. It would be very difficult for
    us to absorb any cut right now. As I indicated earlier, I think
    we'll require assistance from OSD, at our current burn rate, to
    get to fiscal year 2004; and in fiscal year 2005, we will
    probably be cash-flowing out of the third and fourth quarters
    in the early months of fiscal year 2005.
        Senator Inhofe. Any comments, Secretary England----
        Secretary England. Well, Senator----
        Senator Inhofe.--either or you?
        Secretary England. Yes, I do want to make a comment here,
    because, Senator, my comment earlier about efficiency and
    effectiveness, we have been reducing the costs of our naval
    forces. We're actually reducing the number of people in the
    Department of the Navy, so we have become very, very efficient,
    and, I believe, much more effective. Now, when you become more
    efficient, then it is much harder to absorb reductions, in
    terms of funding, because you don't have any margin left.
        So we have not looked at this. Obviously, we have to do
    some analysis, but certainly it would be difficult to absorb.
    If we have to do it, certainly we would do it, but it's very
    hard, based on what I believe has been very effective work on
    our part in being a much more efficient organization.
        Senator Inhofe. Secretary Roche.
        Secretary Roche. I would not know where to get that money
    from at this point, sir.
        Senator Inhofe. Yes, well, I wanted to get you guys on the
    record, because this is going to be a discussion on the floor.
    I agree with you, I don't know where it would come from. I look
    at something, Secretary Brownlee, that sets, as the law, that
    says you have to field a non-line of sight (NLOS) cannon----
        Secretary Brownlee. Yes, sir.
        Senator Inhofe.--by 2008. A definition of ``fielding'' is
    that a prototype, or what it is. Nonetheless, we know that we
    need that for our kids, for our----
        Secretary Brownlee. Sure.
        Senator Inhofe.--troops over there, that capability.
        Let me make one comment, I'm sorry that Senator McCain
    left, I just wanted to mention something about the discussion
    with General Jumper before this committee as to Tinker Air
    Force Base and some of the things that were stated about
    doctoring up charts and so forth. I did some checking myself to
    find that when they talked about the degree of corrosion that
    had taken place, they broke it down in different areas--
    fuselage, bulkhead fitting, wings, and such as that.
        The fifth point was left off, which they should not have
    done, I agree with Senator McCain in that respect and that is
    the chart using bulkhead fittings and the fact that there are
    four occurrences out of 82 aircraft, or a 5-percent occurrence
    factor. Now, I think that was kind of implied, and I would have
    felt the same way if I had looked at this in isolation, that
    we're presenting a problem that's greater than it is. However,
    when you stop and realize that only a third of that which is
    done is done at Tinker, it could very well be that the others,
    in order to get up to the service life of all vehicles, is 11.5
    percent. That would mean perhaps in some other areas it's 20
    percent.
        Second, if you look at some of the other parts of the
    charts, such as the chart that would be corrosion and service
    life report on the fuselage skin body, that report, which was
    the fifth point that was left off, said the history of 82
    aircraft and 18 occurrences, 22 percent occurrence factor,
    which is greater than the 18.5 percent. If the intent were to
    try to make it look as if the problem is not as great as it is,
    I don't think that that would have been left off. It's just my
    comment. I'm not requiring any response, just that I did take
    the time to go down and look and see what that situation was,
    and I believe that to be true.
        End strength, Secretary Brownlee, we've talked about all
    the things that you guys are doing over there. We've talked
    about OPTEMPO over and over and over again before this
    committee and all levels of the United States Army, and I would
    say the same thing with perhaps the Marine Corps, too. The
    temporary increases up to 30,000 soldiers, I would just like to
    just ask you to answer the question, where are we in end
    strength? What would you share with us this morning?
        Secretary Brownlee. Well, sir, what we have proposed is to
    grow the Army by 30,000 over the next several years to create
    at least 10 additional combat brigades, and to use the
    authority in title 10 that allows the President to waive the
    requirements of end strength to allow us to do that. You will
    recall, when we were--the Chief of Staff and I were here last
    November, we advised the committee then that we were already
    20,000 over our authorized end strength, and that we had done
    that in accordance with that authority in title 10, and we were
    paying for those additional 20,000 out of supplemental
    appropriations. So it seemed reasonable to presume that if we
    took those 20,000 and about another 10,000 and used that to
    stand up 10 new combat brigades that could then be of very much
    use in the fight we're in now, that that would be appropriate
    to do, both in terms of the authority and in terms of the
    intent of the funding, and that that would allow the Army,
    then, the kind of headspace and flexibility we could also use
    to go in and, over the next several years, find, within our
    current authorized end strength, an additional 30,000 spaces of
    efficiencies, so that hopefully at the end of a 3-year or 4-
    year period, we would be able to keep those 10 combat brigades,
    but, at the current end strength----
        Senator Inhofe. Yes, thank you very much Secretary
    Brownlee.
        Mr. Chairman, I'm hoping we'll have a second round. I had
    some--I've been spending quite a bit of time in California.
        Chairman Warner. Well, let's see what we can do. The votes
    will start at--I think it is 11:35, giving the first ones 15
    minutes to vote. We'll try and do that, because I, myself, have
    not taken time on questions yet.
        Senator Ben Nelson.
        Senator Ben Nelson. Thank you Mr. Chairman.
        Chairman Warner. But we'll try that, Senator.
        Senator Ben Nelson. Thank you, Mr. Chairman.
        Gentlemen, I would say that trying to find $1.6 billion,
    and moving it around, may be, as Secretary Roche said,
    something like robbing Peter to pay Paul, but it may be robbing
    Peter to pay Peter. I think that's the concern that I would
    have. The budgeting process back here is the equivalent of
    making a pie a piece at a time. I know the accountants try to
    account, but I would hope that we don't end up obscuring, in
    the process of creating money and obligations. So I'm very
    cautious. I want to suggest caution, because pushing off
    obligations into the future isn't the most accountable way of
    handling these ongoing obligations or contingent obligations.
        Secretary Roche, I'd like to go back to a little less
    controversial subject, ongoing sexual assault cases in the
    military. Last week, the Personnel Subcommittee of this
    committee had a service-wide hearing on the subject, and I know
    that when--since the new Air Force Academy leaders took over,
    there have been a continuing number of reports, 21 reports, of
    sexual misconduct. Secretary Rumsfeld has ordered a review of
    the Department policy on sexual assault and the treatment of
    victims. Last week, we heard about that.
        Do you foresee any further delay in the completion of the
    Department's investigation of the Air Force Academy and sexual
    assault cases? We have issues with soldiers, airmen, and
    cadets, as you understand, and perhaps you can give us your
    thoughts and projections about that.
        Secretary Roche. Yes, Senator. To begin with, the numbers
    are used to pick up many different things. Sometimes the
    numbers that you hear are old cases that are only now being
    reported. If you look at incidents that have occurred since----
        Senator Ben Nelson. Subsequent to----
        Secretary Roche.--subsequent to the Agenda for Change,
    we've actually had only 10 cases, involving cadets. There have
    been others on the base itself, and down at the prep school
    we've had two incidents.
        The Inspector General's report, there's two parts to that.
    The Air Force Inspector General, I had asked--it was folded
    into the larger picture--to look at every single case that had
    been adjudicated or not adjudicated where a victim, or alleged
    victim, had problems either with the way it was handled or the
    way they were dealt with. I would expect that the Air Force
    part of that to be done in this month; and most of the cases,
    in fact, have been submitted for extra review down to OSD.
        With regard to the Inspector General, the Department's
    overall review, you would have to ask him. I know that, as
    cases came up, it took more time, as there were more leaders
    from the past that had to be interviewed. That took more time.
    I can't tell you where they are on that.
        Senator Ben Nelson. Okay. Well, last week I suggested that
    I thought the military was taking a serious approach to this,
    but I was a little concerned about the lack of outrage. I must
    say, Secretary Roche, what you said today was as close to
    outrage as I've heard. It seems like perhaps we are getting to
    the point where it's not simply a matter of taking this
    seriously, but being outraged by the fact that it has occurred
    in the past, and other outrage will emerge if it continues into
    the future, I can assure everyone----
        Secretary Roche. Senator, you recall that I gave a speech
    at the Air Force Academy, a year ago right about now, which was
    all outrage.
        Senator Ben Nelson. All right. I just want to make sure
    we're outraged by these incidents. More importantly, we're
    serious about dealing with them.
        Senator Ben Nelson. I think there is a sincere effort. I do
    think that we need to continue to pursue it aggressively with
    modifications to current systems, as we discussed last week.
        Secretary Brownlee, with respect to the Patriot advanced
    capability, I'm a strong advocate of the missile defense
    system, and I've supported the Patriot advanced capability,
    PAC-3. But, after the recent reports from weapons experts
    saying that the problems with the Patriot missile system
    weren't fixed before the weapon was deployed in Iraq, I must
    admit I'm greatly concerned. You may--and I'm sure that if you
    haven't, you will--see the 60 Minutes segment concerning the
    flaws. My understanding is that the Patriot had 12 engagements
    in the Iraqi war, of which one quarter of these engagements
    were with our own planes, not something that we had planned on,
    nor something that we can accept as being normal.
        In fact, during March of last year, a U.S. Air Force pilot
    flying an F-16 fighter jet received a signal he was being
    targeted by radar. He believed it was coming from an enemy
    missile. He fired one of his own missiles, obviously in self
    defense, and hit one of our own Patriot batteries, which was
    tracking his aircraft as an enemy target.
        I guess the question I have is, what evidence can the Army
    provide us to ensure that in the future, for our aircraft and
    service men and women, that they will not be targets of our own
    defense system? What steps are being taken? Clearly, this is a
    serious concern. It's one I've had about deployment before all
    the research and development has been concluded. Racing to
    judgement, racing to deploy has its adverse consequences. It
    appears that that's what occurred here. No one expects
    perfection, but it looks to me like the malfunction is related
    to the lack of total research and development before
    deployment.
        Secretary Brownlee. Sir, I don't think we know the answer
    to that yet. I'm sure, the Central Command investigation is not
    complete. We're still waiting for the result of that. But we've
    looked very specifically at the system. These things occur as a
    result of not just problems with the technology--and this may
    be the case----
        Senator Ben Nelson. Well, it could be training, as well.
        Secretary Brownlee. It could be training. It could be other
    situations on the battlefield. This was a very highly
    electronic battlefield, as you well know. These systems and the
    way they are employed have a lot to do with this. In this
    particular case--and, again, we don't have the conclusions of
    the study, but we know that we had moved our systems forward,
    more so than we had done in previous wars, and we did this for
    obvious reasons. As the troops near Baghdad--neared Baghdad,
    everyone was concerned that they might come under a chemical
    attack of some kind, and so we had moved these systems forward.
    We're looking very closely at what impact that might have had,
    both on the awareness of the pilots, as well as the systems and
    how the systems operated.
        So, quite frankly, sir, we're still awaiting the outcome of
    the Central Command investigation to see what that says.
        Senator Ben Nelson. Well, two thoughts. One is, were our
    military men and women safer as a result of the battlefield
    testing of this program, or would they have been safer without
    it? Did it make our men and women safer, and our military
    capacity stronger?
        Secretary Brownlee. Sir, given a threat that had emerged as
    we had expected it to emerge, I certainly would say they are
    safer. Even given what they did come up against, I would say
    they are safer.
        Senator Ben Nelson. But, is battlefield testing, while it's
    important to do so, risky with high-tech equipment until we
    know what the incident of intervention with other technologies
    and other sensitive equipment might bring?
        Secretary Brownlee. Yes, sir. If you're focusing on the
    PAC-3 interceptor--and, again, we don't know yet--but I would
    be surprised if that turned out to be what was at fault here.
    There may be problems within the Patriot system, but I'm--I
    would be rather surprised if it were in the PAC-3 interceptor.
        Senator Ben Nelson. Well, we would hope to get a better
    success ratio than we had, would you agree with that?
        Secretary Brownlee. I certainly don't believe we can have
    the incidence of fratricide. None of those are acceptable----
        Senator Ben Nelson. Right.
        Secretary Brownlee.--in any way. Whatever we have to do to
    fix that, we have to fix it.
        Senator Ben Nelson. Thank you.
        My time is expired, Mr. Chairman. Thank you.
        Chairman Warner. Thank you, Senator, for raising the
    important subject of this sexual abuse. The full force and
    effect of this committee is behind you in making, hopefully, a
    zero-tolerance correction of that problem.
        Senator Collins, that's a problem in which you've been
    involved. You're next recognized.
        Senator Collins. Thank you, Mr. Chairman.
        Secretary Brownlee, like many of my colleagues, I have
    heard repeated concerns expressed by the families of our guard
    members and reservists who are serving in Iraq about the
    shortages of body armor and fortified HMMWVs. In fact, one
    soldier was home on leave, in December, and called me
    personally to talk about this and the consequences that he
    feared for the members of his unit.
        I'm very pleased, therefore, to hear from you this morning
    of the progress that has been made. But when I look at your
    chart in your testimony, it indicates that a year ago only 12
    percent of the soldiers in Iraq were equipped with body armor,
    and only 500 HMMWVs were fortified. Why were we so ill-
    prepared? Why didn't we have more body armor and more fortified
    HMMWVs available to protect our troops? There seems to be such
    a discrepancy. I'm pleased with the progress, but I'm wondering
    why it was so misjudged.
        Secretary Brownlee. Yes, ma'am. Quite honestly, we were not
    producing this body armor at a rate that would allow us to
    equip all the soldiers with body armor before we went in. What
    we did was use what we had and equip those soldiers that were
    infantry and front-line soldiers that would be most likely to
    come under attack.
        The requirement for up-armored HMMWVs, proportionally, had
    never been that great because most of these kinds of HMMWVs
    were not viewed as favorably for tactical situations because
    their performance is somewhat degraded by the heavy weight of
    the armor. So there wasn't a feeling that all HMMWVs should be
    up-armored. It was when we got into the operational environment
    in which we found ourselves, that began in June and July last
    summer, that we realized that all soldiers were being exposed
    to these kinds of attacks, and that convoys, in particular,
    were exposed to these kinds of improvised explosive devices
    (IED) attacks. That's when we began to ramp up to provide those
    as soon as we could, and we've redistributed, from all over the
    world, the up-armored HMMWVs that we've had in other places.
    We've moved--I think the last ones are just moving in there
    now, should all be in there in April. We began a crash program
    on the body armor. We're now producing at rates up to 25,000
    per month.
        I also regret that we were not more farsighted here. We
    simply were not prepared for that kind of a counterinsurgency
    that attacked our convoys and our soldiers in the rear, as it
    has proven to be.
        Senator Collins. Secretary England, I know that you're
    expecting, of course, a shipbuilding question from me, and I'm
    not going to disappoint you in that regard. I very much
    appreciate the commitment that you've shown in your budget to
    fully fund the construction of three guided missile destroyers
    (DDGs) this year, and we've certainly made a lot of progress.
    When I look back at 2000, the year 2000, I think we were
    spending only $4.8 billion for shipbuilding and conversion
    budget; it's now more than twice as much, at $11.1 billion.
    That's a significant and much-needed improvement.
        I remain, however, very concerned about the Department's
    future shipbuilding plan, particularly as it affects the
    transition from the DDG to the experimental destroyer (DD(X)).
    The Navy appears to be slipping the construction of a second
    DD(X) destroyer by 1 year, from fiscal year 2006 to 2007. If
    this occurs, it would be the first year in more than 20 years
    that our Navy will not be procuring a major surface combatant.
    My concern is twofold. One is that it will exacerbate the
    already significant problem with regard to the size of our
    fleet, and we have the CNO's recent testimony on the ideal size
    of the fleet of being around 375 vessels. But, it also has a
    significant impact on our industrial base, our ability to keep
    the skilled workers that we need, and to keep some competition
    in the shipbuilding industrial base.
        So I would ask that you comment on what are the Navy's
    plans to ensure that we keep moving toward increasing the size
    of our fleet, something study after study has demonstrated we
    need, and also the impact on the stability of our industrial
    base.
        Secretary England. Thanks, Senator. Two comments here.
    First of all, for the DDX--DDG to DDX conversion, you're right,
    we do have a void in 1 year. My hope and expectation is we can
    fix that as we go along, because that is an out year. That's a
    plan; it's not an actual at this point. Our issue, of course,
    is affordability. We are required to fully fund a ship at the
    very beginning. Of course, that's very difficult for us to do.
    I mean, it would be better if we could partially fund, but we
    have to fully fund. So, in this case, we literally had to move
    the total amount of about $2 billion to the right, rather than
    to the left. Now, hopefully, we can fix that as we go along.
        On the other hand, I will tell you, the industrial base is
    always of a concern. We do not want voids in the industrial
    base. That's not good for our industry; it's also not good for
    us, because it's costly and disruptive. We do have a study
    underway. Assistant Secretary John Young has been conducting
    this study on the industrial base. That is finished, I believe,
    now, and will be briefed to you very shortly. It could be
    today, tomorrow--but, I mean, this week, I believe, we will be
    briefing you. As part of that, we have worked with the
    leadership of all the major shipyards to make sure we do
    understand their issues and problems, because it's in our
    interest not to have those problems in our shipyard. So we are
    paying attention to it. We do not want breaks in our production
    line. We will continue to address that so that's not an issue
    for the industry. We don't want that to be an issue in the
    industry.
        Senator Collins. Thank you, Mr. Secretary. Thank you,
    Secretary Brownlee.
        Secretary Brownlee. Mr. Chairman.
        Chairman Warner. Senator Chambliss, I wonder if you'd
    indulge the Chair. I haven't asked any questions. I want to ask
    one question while our distinguished colleague from Maine is
    here, because she has been an absolute leader on this issue,
    and that is, Secretary England, that it's been reported that
    the Navy will be the first service to implement the new
    flexible hiring authorities contained in the National Security
    Personnel System (NSPS), which Congress adopted last year, and,
    additionally, that you will take on a special role for the
    entire Department, it's my understanding, to assist in the
    implementation of the new civilian personnel bylaw and
    regulation. I commend you for stepping up and accepting that
    challenge.
        So give us a little overview of how the Department has
    handled the initial steps toward the implementation of the
    NSPS, and how you see your role in the coming year.
        Secretary England. Mr. Chairman, thank you. Deputy
    Secretary Wolfowitz has asked if I would assist in the
    implementation, just because of my experience and background
    with large organizations, and particularly with the union
    groups and representative employees. So about 2 weeks ago, I
    did start to engage in this process. I have had the first
    review with the Department of Defense personnel. I have another
    one scheduled for this Thursday. So I'm still, myself, trying
    to understand the total implementation process. I do know it
    has moved along rather quickly. The question really is one of
    consultation in the process that we're using. So this is really
    a question of process.
        The Department of Navy did volunteer to be the department--
    the lead department in implementing NSPS, which is perhaps how
    I got asked to assist in this matter. So I'm really not in a
    position to give you definitive input at this time. But in
    approximately 2 weeks, I would be pleased to come back and meet
    with you and other members of the committee.
        Chairman Warner. We'll accept that. Because there's been
    some concern, my understanding--the Senator might wish to
    elaborate--about the Office of Personnel Management (OPM), a
    separate entity within our Federal system, and their
    coordination, collaboration, whatever you want, partnership, I
    would hope, in this implementation. Am I correct in that,
    Senator?
        Senator Collins. You are correct. The OPM, under law, is
    supposed to be involved in the development of the new system.
    That's very important, because OPM has unique expertise in the
    Federal Government that I think can be very helpful to the
    Department. I think it's very important that even at these very
    initial stages, that not only the Department go forward, but
    that it engage in a collaboration with OPM and with the Federal
    employee unions.
        Chairman Warner. Well, I thank you, Senator.
        Secretary England. I'm sorry. Senator, I will be meeting
    with the director, Kay Cole James, at a breakfast meeting this
    Friday, so it would have been sooner, frankly, except my own
    schedule out of town, et cetera. So we will be meeting, having
    those discussions this week.
        Chairman Warner. Good. Well, that's reassuring. Because
    this committee took a very strong leadership role on this
    issue, which was quite controversial, and I think we moved very
    strongly in the direction in which the President and the
    Secretary of Defense so desired because of the uniqueness of
    this particular Department. But we're also running comparisons
    as to how this is operating in your former Department, Homeland
    Security. So we're going to be a constant oversight on this as
    you move ahead on it.
        Secretary England. I appreciate it, sir. This is a very
    important piece of legislation. I thank you for passing it last
    year. It is incumbent on us now to do it appropriately and
    correctly, and we are working to do that, sir. I will be
    pleased to work with you and other members of the committee.
        Chairman Warner. Thank you.
        Senator Chambliss, thank you very much.
        Secretary Brownlee. Mr. Chairman, I wasn't sure if Senator
    Collins might have to leave, and I'd just like to correct the
    record----
        Chairman Warner. Yes.
        Secretary Brownlee.--on one thing that I said. I indicated
    there were 2,700 soldiers in Afghanistan who did not today have
    body armor. That's 700, not 2,700. I'm advised they'll have
    them by Friday.
        Senator Collins. Thank you very much. That's good news.
        Secretary Brownlee. One other issue. With respect to
    priorities to Reserve components versus actives, just so you'll
    know, we have mobilized and will deploy three separate brigades
    from the National Guard, enhanced brigades the 30th, out of
    North Carolina; the 39th, out of Arkansas; and the 81st, out of
    Washington State. The Chief of Staff of the Army and I made a
    decision that they would have first priority over the active
    components in equipping them with the rapid fielding initiative
    equipment, which also includes the body armor. So they will get
    all the array of soldier items that--it's about $3,000 per
    soldier, and includes sunglasses and knee pads, and all these
    things--and they have a higher priority on that for this
    deployment than any of the actives.
        Senator Collins. Thank you.
        Chairman Warner. Senator.
        Senator Chambliss. Thank you, Mr. Chairman.
        Before I ask a question or two, I just want to make a
    comment, first of all to associate myself with the comments of
    Senator McCain and Senator Levin on this critical issue of
    document production. This is a fundamental issue that we have
    to resolve, and I know under your leadership, Mr. Chairman, we
    will.
        Second, with respect to the implementation of these new
    civilian rules, as the chairman and Senator Collins know, I had
    some real misgivings about moving as quickly as the Department
    of Defense wanted to move last year during the authorization
    process. Thanks to Senator Collins' particularly strong
    leadership on another committee, we did work through that and
    we have something that I think will work. Secretary England,
    you know what great respect I have for your abilities, and I'm
    very pleased to hear you say that we're moving on this and
    we're going to do it in the right way, because it's very
    sensitive with our civilian force. The morale is pretty high,
    and we don't need to do anything right now to jeopardize that.
    So I'm very pleased to hear you're doing this.
        Secretary England. Right, sir. Thank you.
        Senator Chambliss. Secretary Roche, I want to visit with
    you for a minute about the F/A-22. Last week I had a visit with
    the Air Force, as well as visited the plant in Marietta, a
    production facility, to discuss the status of the program, and
    I came away with great confidence that while there are still
    some minor glitches--and I say minor; any glitch in a weapon
    system is a glitch, but when you look at the complexity of this
    weapon system and the problems that we've had with it, as we
    have with every major weapon system through the course of
    research, development, and now in production--the glitches we
    have now are truly minor glitches, but we're working through
    those, and that everything is headed in the right direction. We
    may be a little bit behind on the testing schedule, but it's
    anticipated, by both the Air Force and Lockheed, that we're
    going to catch up on that testing within the short term, not
    the long term.
        There's an article in the paper today by the Bloomberg News
    that has a less positive assessment, and I wanted to get your
    comments on that article.
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        There's one statement in there that I'm particularly
    concerned with. We have an independent assessment being done by
    the Pentagon. The director of the Independent Program Analysis
    that's doing that study makes a statement that indicates to me
    that he doesn't understand the capability of this weapon system
    and the real ability of this weapon system to ensure that we're
    able to maintain air superiority.
        We've been able to maintain air superiority over the last
    several conflicts we've been involved in. It's been the reason
    that we have suffered the least amount of casualties in any
    major conflicts that we've been engaged in in the last 30
    years. The F-15C has been a great weapon system. It's done its
    job well. But it's my understanding that there is in production
    right now, by the Russians, a weapon system that is comparable
    to the F-15C, and that if we're going to rely on the F-15C with
    upgrades or modifications in the future, that we are not going
    to be able to maintain air superiority.
        The F/A-22 has the ability to penetrate enemy lines, fire
    one, two, three shots, in some instances, before it's even
    detected. I want to make sure that you have an opportunity to
    address this issue relative to air superiority and the real
    need of the F/A-22. I understand it's your number-one program,
    and I appreciate that fact. But, if we're going to continue to
    have these darts thrown at a weapon system that's going to
    allow us to maintain air superiority, and to ensure that we're
    going to be able to engage in conflicts with the least loss of
    life possible, I think it's critically important that we get
    that message out to the American people, as well as to Members
    of the House and Senate.
        So I'm throwing that out to you for your comments on what I
    know is a very important issue to the United States Air Force.
        Secretary Roche. Without filibustering the issue, sir, let
    me make the following points with regard to the status of the
    program now. We know of no major obstacles. But as you go
    through tests and evaluations, things come up. It has in every
    other program; and it will in this one, as well. But with the
    major problems that came up, I think we have two track records
    to be proud of. One, each issue that people were so concerned
    about in the past, we've fixed. Two, the stability of funding
    has caused stability in the production line, which is making
    the production of the aircraft more efficient over time. It is
    a very complex system.
        The entry into initial tests--operational tests was based
    on events, not dates. The limiting problem we have now is
    having the sortie generation rate, which has to do with the
    failure of small parts on the plane such that you don't get
    enough sorties per day. We are working that. Part of the
    problem is the diminished material sources, very few
    subcontractors, and parts that were presumed to never fail are
    failing. That will apply to any plane that we build in the
    United States. Joint Strike Fighter will face the same problem.
    It's good to know it now so that we hopefully can prepare a bit
    for that. But we are working each of those down, and we will
    enter into the test program when we have the sortie generation
    in place.
        The pilots who have flown the plane just are awestruck at
    it. I've had a chance to be with them at Edwards, at Nellis,
    Tyndall. At Tyndall, meet with all the maintainers, and then
    the planes took off, flew, came back; no discrepancies
    whatsoever on the aircraft. Its capabilities of stealth, super-
    cruise, advanced avionics are all playing out as we expected
    them to play.
        We also have modified the aircraft so that it's more of an
    air-to-ground airplane than it was the past, to specifically
    support land forces. So one of the reasons that the Army could
    give up on a deep-strike system is that that's a responsibility
    that we will take, and that the F/A-22 would be our premier
    system, to go deep to focus on moving targets, which are very
    hard to bomb, typically, and we're doing that. It's also the
    only aircraft that really gives you a good chance against
    cruise missiles, mainly because of super-cruise. You could put
    the same electronics on something like an F-15, but you can't
    super-cruise.
        The F-15s will never be stealthy. They are large in radar
    cross-section. We will maintain some as a bridge, as we
    transition to the F/A-22. But the F/A-22, among other things,
    deters anybody from building a system and thinking they could
    achieve air dominance, because they can't. The planes that the
    former Soviet Union is now constructing are very good. In fact,
    if we put our pilots in those new planes, against our pilots in
    our planes, our F-15s, our pilots in their planes will win
    because it's advanced technology. But you bring the F/A-22 into
    the picture, and that changes dramatically.
        So I believe it is a system that is more and more oriented
    toward ground support, in terms of deep interdiction, moving
    targets, working with special operating forces that are
    distributed. It is specifically being oriented to targets that
    are moving. Increasingly, enemies of ours know that if you
    stand still, you're easily bombed, but if you move, you can, in
    fact, avoid us. It is the only aircraft that we have that gives
    us a reasonable chance to take more than one shot against a
    cruise missile.
        So I believe it'll stand the test of people looking at it.
    If someone wants to do yet another study of it, I believe
    that's not unreasonable. This is not a cold war system today,
    just as the B-1 is no longer a cold war system. We've made
    enough transitions in the B-1 to make it very appropriate for
    this era, and we believe we've done the same thing to the F/A-
    22.
        Senator Chambliss. Thank you, Mr. Secretary.
        My time has expired, Mr. Chairman, but I have a written
    question that I'm going to submit.
        Chairman Warner. Why don't you go ahead, you can take
    another question.
        Senator Chambliss. Okay.
        Secretary Roche, I noticed, in your written statement, you
    make reference to the 116th Control Wing at Robbins AFB, which
    flies the Joint Surveillance Target Attack Radar System
    (JSTARS) and 116th to the 1st blended active Reserve wing in
    the Air Force, in the entire military. I'm proud of the work
    the 116th has done. We worked through some difficult issues
    there. Boy, I'll tell you, the morale of the Guard and the
    Active Force is unsurpassed within those folks, and, Les, you
    know what a great job JSTARS does for your folks, and it's such
    a great weapon system, and this is a great integration of the
    active and Reserve component.
        This model truly does move us to the total-force concept
    that the Secretary is talking about with respect to every
    branch of the Service. I want to just ask each of you if you
    have looked at the blend between the Guard and the Active Force
    that we've accomplished with the Air Force, and, Secretary
    Roche, how you intend to expand on this as we move forward.
    This issue of force structure continues to be an active and
    vital issue. Secretary Brownlee, you have addressed it in a
    certain way within the Army. But I think this blended-force
    concept is the wave of the future, with the way Secretary
    Rumsfeld is talking. So I'd ask each one of you, will you just
    comment on what you see here, how you think your respective
    branch is going to deal with this, are you going to move in
    that direction?
        Secretary Roche, why don't we start with you, because
    you're the one with the experience on it.
        Secretary Roche. Well, and you, as well, since you helped
    me. We did have to get through some difficult times. It has
    proven itself in combat, which, as Admiral Burke once told me,
    is the only real test of a weapon system, is how it performs in
    combat. JSTARS, as a blended wing, has performed magnificently.
        We should also make sure everyone realizes that there are
    Army officers onboard the JSTARS at all times, so it's not just
    Air Force officers.
        It has worked very, very well. We have taken that concept
    and expanded it, especially in the area of unmanned vehicles
    and remotely piloted aircraft. We've done another unprecedented
    move, with the help of some wonderful guardsmen in California
    and Nevada. We actually have California guardsmen and Nevada
    guardsmen in with Reserves and Active Force, right from the
    beginning on our Predator developments and our Predator
    control, so that it'll be done at the same time.
        We are looking at other areas. We have some in space, some
    for helping our Strategic Forces Command. We're looking
    wherever it may make sense to do it, because it brings the
    Guard into our most modern systems. Because the newer systems
    are so much more usable, we can have multiple crews for the
    same aircraft. So we expect to do this with the F/A-22, as
    well. It appears to be something that, where it makes sense to
    do, it really, really pays off, and there are other
    constitutional issues you helped us with.
        So I commend it. It doesn't work in every case, but we're
    finding more and more places where it is in the interest of
    both the Guard and the Active Force to bring the experienced
    folks from the Guard together with the full-time people on
    active duty, and you get a much higher crew ratio. If you have
    to go to war, the active people take it, but then, coming
    behind them, are the Guard folks who supplement the original
    active group.
        JSTARS works just beautifully, and I'll be flying with them
    in the area here shortly.
        Secretary England. Senator, of course, two services; first,
    though, I'll comment about the United States Marine Corps. Our
    Reserves are ready to go at literally 7-day notice--whatever
    their transportation time, they're ready to go into combat, so
    they actually work with our Active Force, indistinguishable,
    ready to go on a moment's notice, literally, and that's working
    well, has worked for the United States Marine Corps.
        The Department of the Navy, we are combining our assets
    between active and Reserve. We are actually reducing our assets
    as a result, because we do want a total force, in terms of
    integrated Reserve and Active Force. In fact, we are reducing
    the size of our force, largely brought about with our
    integration between our active and our Reserve components.
        So we do this across the board. Our ships, our airplanes,
    everything we do, this is a very active integration. I think
    you will see, over time, that we will likely continue to shrink
    both our assets and our force somewhat as we continue this
    integration.
        So we're committed to it. At any given time, about 25
    percent of our reservists are actually doing active duty. The
    pilots that fly commercial airlines--when they're not flying
    commercial airlines, they're flying for the United States Navy,
    a lot of them, those that are in our Reserve organization. So
    you will see more and more integration of our Reserves and our
    Active Force. Again, our Marine Corps is already highly
    integrated at the moment.
        Secretary Brownlee. Sir, we have some multi-composition
    units at echelons above division that are primarily
    headquarters units. As we stand up these new brigades in the
    active component, we will stand up new brigades in the Reserve
    component. They will all be standardized and modularized.
        There is not an intent right now to blend them, I don't
    think, in the sense you are talking because, although we do
    have active component soldiers integrated in with our Guard and
    Reserve units--anyway, we have some 5,000 that are out there;
    senior officers and non-commissioned officers (NCOs) integrated
    in these units--they're not blended in the way that you might
    have described. We'll have to take a look at that to see how it
    would work with these kinds of units. I'm just not sure how it
    would, but we'll certainly take a look at it.
        Senator Chambliss. Thank you, Mr. Chairman.
        Chairman Warner. Thank you. It's a very important question,
    Senator Chambliss.
        Just a follow-on with the Secretary of the Army, we see
    that the force structure in Iraq now will be comprised of 40
    percent National Guard.
        Secretary Brownlee. Yes, sir.
        Chairman Warner. When will that figure be reached, that 40
    percent level?
        Secretary Brownlee. Sir, right now, in the rotation that
    we're doing, of moving forces over and bringing them back, we
    are about 30 percent complete with shipping forces over, and
    about the same amount coming back.
        Chairman Warner. Yes.
        Secretary Brownlee. We will not complete these rotations
    until sometime in April/May, so I would say it would be--in
    that time frame, is when it would be complete.
        Chairman Warner. As those units depart, to what extent can
    yourself and the Secretary of Defense assure the individual
    guardsmen that, subject to some changes, which are not
    foreseeable, their commitments will be for what period of time?
        Secretary Brownlee. Sir, their commitments are for 1 year
    boots-on-the-ground in----
        Chairman Warner. In Iraq----
        Secretary Brownlee.--theater. Yes, sir. In Iraq.
        Chairman Warner. So maximum is----
        Secretary Brownlee. Yes, sir.
        Chairman Warner.--365 days, the boots depart.
        Secretary Brownlee. Yes, sir. But their mobilization
    periods of time, of course, are longer because they have to be
    trained up----
        Chairman Warner. Correct.
        Secretary Brownlee.--mobilized, trained up, and then
    brought back and demobilized. So it can be up to another 6
    months, depending on how long they're training; in some cases,
    longer than that, depending on their training.
        Chairman Warner. What's the composition, in Afghanistan, of
    Guard and Reserve?
        Secretary Brownlee. I'd have to look at the proportions. I
    know we have a unit from the 45th Oklahoma National Guard, that
    unit is in Operation Pegasus, which is training the Afghan
    army. I'd have to look at the proportion. I know there are
    about 11,000 troops there; about 10,000 of those are Army. I
    would suggest probably about 20 percent of that may be Guard.
    I'll have to get that number for you.
        Chairman Warner. My understanding is perhaps there's a unit
    from Alaska. Would you check on that and provide a response?
        Secretary Brownlee. I will. Yes, sir.
        [The information referred to follows:]

        As of March 1, 2004, there were no Alaska National Guard members--
    Army or Air--assigned to operations in Afghanistan. Units and
    individual augmentees had previously and subsequently have been
    assigned to that area of operations.

        Chairman Warner. I thank you very much.
        Now that my colleague, the ranking member, has returned--I
    was absent on the floor during the course of your opening
    comments with regard to the budget, but I would like to make
    these observations. That is that, in a report released last
    November, the Congressional Research Service (CRS) examined 46
    cases since fiscal year 1990 in which funds were appropriated
    for military operations. CRS concluded, and I quote, ``Since
    1990, Congress generally has funded combat operations with
    supplemental appropriations,'' Some have suggested Congress
    begin budgeting for operations in Iraq through the regular
    appropriations process.
        So I'd call on you, Secretary Brownlee--you've had,
    obviously, the longest experience in this area, both with this
    committee and other periods of your distinguished career--can
    you, in your judgement as the acting secretary, reliably
    estimate the cost for your respective service of military
    operations in Iraq and Afghanistan for fiscal year 2005 today?
        Secretary Brownlee. No, sir. I certainly couldn't have done
    it at the time we put the budget together. That's why I think
    that the Congress has routinely funded military operations like
    this out of supplementals. If I'm correct, I think we did the
    operations in the Balkans for at least 3 years, or more, funded
    them through supplemental appropriations, and I would suggest
    that those operations were far more certain and stable than the
    situation we find ourselves in in either Afghanistan or Iraq.
        Chairman Warner. Before I leave you, I'm just going to ask,
    for the record, you were questioned by members of the committee
    with regard to the body armor.
        Secretary Brownlee. Yes, sir.
        Chairman Warner. You, very frankly, said, ``We just failed
    to estimate the needs.'' But my recollection is that the orders
    for this originated in the previous administration and----
        Secretary Brownlee. Yes, sir.
        Chairman Warner.--this buildup. So I think it would be
    important for the record--I'm not trying to be political --but
    this is a sequential operation, and having been in your job
    some many years ago, what occurs in the previous administration
    is carried over, and it takes time to ramp up and get second
    sources to meet contingencies.
        Secretary Brownlee. Yes, sir. It does, sir. While we had
    already looked and started to increase the numbers of these, we
    just weren't there yet, in terms of volume.
        Chairman Warner. Well, I think it would be helpful if you
    would----
        Secretary Brownlee. I will do that.
        Chairman Warner.--talk about the origin of the program----
        Secretary Brownlee. Yes, sir.
        Chairman Warner.--and how it transitioned from the previous
    administration to the Bush administration, and the steps taken
    by the Bush administration, most recently mentioned today, to
    try and bring up an adequate supply.
        Secretary Brownlee. Yes, sir.
        [The information referred to follows:]

        The fielding of Interceptor Body Armor (IBA) to the Army started in
    early 2000. IBA is the successor to the Personnel Armor System for
    Ground Troops (PASGT) vest and the Interim Small Arms Protective Over
    (ISAPO) vest. As you may know, IBA consists of an Outer Tactical Vest
    (OTV) and a set of two Small Arms Protective Inserts (SAPI). The OTV
    replaces the PASGT vest and SAPI replaces the ISAPO. IBA was originally
    intended for dismounted infantry, military police, Special Forces, and
    the National Guard's enhanced separate brigades; units that faced the
    highest probability of direct contact with enemy forces. At the time,
    the Army assumed some risk in not planning to equip support troops and
    other soldiers towards the rear of the battlefield. We did not believe
    these troops faced the same threat, as did our dismounted combat
    forces.
        The Army originally programmed about $46.8 million to procure
    36,000 sets of IBA to be issued to the priority units mentioned above.
    Our original rate of production was 1,000 OTVs and 375 sets of SAPI per
    month. Additional IBA were to be produced following the first 36,000
    sets, and unit commanders would be able to locally purchase on their
    own if they determined they had a need for IBA. The first 5,000 sets of
    IBA the Army produced were fielded to soldiers in Kosovo between March
    2000 and July 2001. The next set of 5,000 produced was placed in a war
    reserve contingency stock.
        Immediately after September 11, 2001, SAPI production was increased
    to 1,600 sets per month, and shortly thereafter, we released IBA sets
    from our contingency stocks to the 10th Infantry Division and 101st
    Airborne Division in preparation for what became Operation Enduring
    Freedom (OEF). In June 2002, the Army directed IBA to be issued to all
    soldiers in support of OEF and production was further increased to
    3,300 sets per month.
        In late 2002, in anticipation of possible military operations in
    Iraq, the Army again committed resources to further increase IBA
    production. By the time the Army commenced combat operations into Iraq,
    more than 83,000 OTVs and 50,000 sets of SAPI had been issued. Because
    of this effort, the Army conducted the first phase, major combat
    operations, of Operation Iraqi Freedom (OIF) with sufficient quantities
    of IBA. Many of the brave soldiers assigned to the 3rd Infantry
    Division did not require IBA because they conducted their superb attack
    from the protection of their tanks and armored fighting vehicles. At
    this point in time, the Army thought it had enough IBA on-hand and
    reduced production quantities.
        It was not until we moved into the next phase of OIF, when the
    threat changed, and we were determining exactly how many soldiers would
    be necessary in Iraq, did we find ourselves falling short of having
    enough IBA on-hand. The tank crews and armored vehicle crews that
    fought and won the first part of the war were now being required to
    dismount their vehicles and conduct patrols and missions on foot,
    significantly increasing our IBA requirement overnight.
        With the help of Congress and resources from the Iraqi Freedom
    Fund, the Department again surged the industrial base's production of
    IBA, this time to our present rate of 25,000 sets of IBA per month.
        Today, the Army is committed to procuring a total of 840,000 sets
    of IBA. We expect to accomplish this objective during fiscal year 2006.
    This will ensure that every single soldier in the operational Army,
    whether active or Reserve component, has their own set of IBA.

        Chairman Warner. Thank you very much.
        Now, back to the question of the budgeting, Mr. Secretary.
    Can you estimate the cost of your military operations, Navy and
    Marine Corps, for 2005?
        Secretary England. No, sir. We don't know what our
    requirements will be for 2005. I mean, we are now operating off
    of fiscal year 2004 funding; and, of course, that all changed
    late last year, when the Marines were requested to go to Iraq.
    So even that was very late for Department of the Navy. So I
    don't know what the situation will be next year, what we will
    be requested to do next year. I mean, our budget----
        Chairman Warner. For the balance of this year. I mean, you
    have the Haiti operation. That's a costly one.
        Secretary England. Yes, but I----
        Chairman Warner. It's an example of how you couldn't
    anticipate----
        Secretary England. Yes, it is--right, sir, it is a
    situation that you cannot anticipate in advance, absolutely.
        Chairman Warner. Mr. Secretary, do you concur with your
    colleague?
        Secretary Roche. Absolutely, sir.
        Chairman Warner. On the Comanche, Secretary Brownlee,
    frankly, I support the decision of the Secretary of Defense and
    yourself on that. Please provide, in today's record, if you
    feel there are any facts that were not stated by the
    administration at the time this important contract was
    terminated. Do you have any new information regarding that
    termination that you can share with us this morning? I presume
    it's going on in an orderly way.
        Secretary Brownlee. It is, sir. On the 26th, we met with
    members of industry who were involved in the program, and Mr.
    Bolton met with them, I spoke with them, and we certainly told
    them that exactly what the decision was and how it originated
    and why we made it. There is, of course, as a result of this,
    with the program of revitalizing Army aviation--this will, in
    fact, require the procurement of an additional 800 new
    helicopters, plus the refurbishment of about 1,500 others.
        Chairman Warner. I want to commend the manner in which you,
    personally, and others, handled this very difficult decision.
    Cancellations are not easy. But, I'm the focal point of all
    types of communications and criticisms from 360 degrees, and
    it's been a fairly low level on this one, and obviously there's
    a good deal of disappointment in various geographic sectors of
    our Nation and with certain producers and manufacturers. But I
    think, thus far, it's the right decision, and it's going to
    stay in place.
        Secretary Brownlee. Thank you, sir. I hope that the amended
    budget arrives over here this week. It left the Army last week,
    to OSD, and I understand it's already at OMB, so Congress will
    receive it, hopefully, this week.
        Chairman Warner. Congress, understandably, in the 25 years
    that I've been here with my good friend, Senator Levin, we've
    seen many, many efforts to work on behalf of Guard and Reserve.
    This year, we anticipate the committee will receive a request
    from members. So let's just talk a little bit about it.
        A steady stream of legislative proposals have been brought
    forward in Congress that would greatly enhance the benefits
    provided guardsmen and reservists, and I think they're well
    deserved. I don't criticize them at all. Lowering the age at
    which retired reservists may start collecting retired pay has
    been proposed. Extending Tricare benefits to all reservists has
    been proposed. There are various other proposals, all very
    expensive.
        Now, what impact would, let's say, that entire program
    have, if we were to enact it, on the regular forces? I come
    back, drawing on modest experience of my own as a member of the
    Reserve, and integrated during the Korean conflict into active
    units, there's a certain stature that the active person has,
    and his family--he or she, as the case may be--and the
    commitments that they make. But if we bring them up to where
    they're all absolutely equated in benefits, how does that work?
        Secretary Brownlee. Let me just suggest two things,
    Senator. First of all, you and I both know how valuable the
    Reserve components are, both Guard and Reserve, and----
        Chairman Warner. Let's say essential.
        Secretary Brownlee. Yes, sir, absolutely.
        Chairman Warner. Absolutely essential.
        Secretary Brownlee. They're just absolutely critical to our
    operations now. I refer to them as the ``second-greatest
    generation,'' and I believe that. But I do have some concerns.
    If all the benefits are the same, for both active and Reserve,
    then people who are in the active might question why they
    shouldn't just have a second job and be in the Reserves. The
    other thing is that when the costs of the Reserve components
    begin to equate to the cost of the active components, then,
    within the Department of Defense, decisions will have to be
    made as where the money should be invested, and should we
    invest as many of our dollars in a Reserve component, as
    opposed to an active component, which does still have some
    restrictions on the use, as opposed to the active. So I just
    think we have to move very carefully in that area--
        Chairman Warner. Time is so short, and we're going to have
    this vote here in a moment. I think you've answered it very
    carefully. As much as we all desire to give the Guard and
    Reserve everything to which they are entitled, the Army would
    have to decide, well, if their costs are parallel, then
    probably we're better off having an active person, vice a Guard
    or Reserve, because that individual has continuity and stays
    in, and they're subject now, as we well know, to recycling back
    over to these forward posts----
        Secretary Brownlee. Yes, sir.
        Chairman Warner.--with a greater frequency.
        Secretary Brownlee. Yes, sir.
        Chairman Warner. Secretary England.
        Secretary England. You expressed it very well, Mr.
    Chairman. The Department of the Navy----
        Chairman Warner. I expect no less, from a former Secretary,
    for an old-timer, but I----
        Secretary England. No, you've expressed it very well, and I
    would say that you've captured exactly the feeling of the
    Department of the Navy, sir.
        Chairman Warner. Well, I would hope. Secretary Roche----
        Secretary Roche. I concur.
        Chairman Warner. You concur. I hope that, in your
    capacities, you'll counsel with the head of the Guard and
    Reserve units and meet with the very important retired
    organizations, who take an active role in this. Because we're
    getting pretty close to that parallel situation.
        I think we'd better touch a little bit, Secretary England,
    on the Osprey. We did the V-22, and those programs are always
    under close scrutiny here. This year, we limited production of
    the V-22s to a minimum sustaining rate, identified as 11
    aircraft until certain testing was successfully accomplished.
    The fiscal year 2005 budget for eight V-22s for the Marine
    Corps, and three for the special ops, represents the fourth in
    a row at the minimum sustaining rate.
        I visited down with the special operations command in the
    recess period, and they're very heavily relying on a prompt
    delivery of this system. So give us a little update on the V-
    22, how it's progressing, and when you would anticipate these
    tests would be completed.
        Secretary England. Mr. Chairman, I'm pleased to tell you
    the testing is going well. We do have what I guess you'd call a
    few hiccups, but the testing is going very, very well. We're
    very, very pleased with the progress. I continue to believe
    that the V-22 is one of the most transformational programs we
    have. It will change the character of our Marine Corps, in
    terms of the ability to do deep-type operations. We would have
    liked to have had them for the operation we had in Iraq,
    frankly, because we were so far inland, it would have been a
    magnificent airplane to have.
        So it is very, very important. We are designing literally
    our future, in terms of some of our ships and our Marine Corps,
    as we go forward, and our Navy, to accommodate the V-22. So the
    testing is going well. We support it very, very strongly.
        This is the final test, in terms of major items, although I
    believe, frankly, the major items are behind us. So we should
    be increasing our rate. We plan to do this about 50 percent a
    year now, starting next year, because we don't want the rate to
    go up too fast and cause problems. But you will see this rate
    to continue to increase now as we finish up the test program.
    We then want to get this to the maximum rate as soon as
    possible.
        Chairman Warner. Yes, Secretary Roche?
        Secretary Roche. Mr. Chairman, it's an interesting program.
    It's run by the Navy for the Marine Corps, and there's an Air
    Force colonel who is the program director. The reason is that
    our Air Force Special Operations Command has a great interest
    in this program. So I'd like to second all the comments made by
    my colleague, Gordon England. We follow this very closely. In
    fact, the reason that we have the organization we do now is
    that 2\1/2\ years ago, I went to Gordon and said, ``Wouldn't it
    be better if we were part of your program now, rather than
    waiting 2\1/2\ years and telling you what we thought you should
    have done better?'' He absolutely agreed, opened it up to the
    Air Force, and we have been key to it ever since. Our special
    operators are looking forward to this aircraft. I think you
    know that the one that we will buy will have various and sundry
    additional equipment on it, which will give the Marine Corps a
    chance to see some of that tested, as well.
        We see this as being very important for our infiltration
    and exfiltration in special operations, potentially for long-
    range combat search and rescue. So we are gearing our Special
    Operations Command on the assumption that this aircraft will be
    part and parcel of our Air Force.
        Chairman Warner. As you proceed on this--I got into
    considerable detail, and I was given an exceedingly good
    briefing by knowledgeable people in the special operations, but
    they explained to me just, sort of, some basic concerns that
    they're having, which I think are readily understandable by
    all, and that is on your descent, in the vertical descent,
    oftentimes you have to kick out that rope or other sustaining
    devices for those very brave individuals to exit that aircraft
    and hit that ground. The amount of the thrust down is
    complicating that. Has that been brought to your attention?
        Secretary Roche. Yes, sir. In particular----
        Chairman Warner. The safety of those individuals.
        Secretary Roche.--in particular, for search and rescue,
    having the hoist all the way aft was not a good design. But the
    program has looked at a center box, which would be just inboard
    from where the normal door on the port side would be for a
    rescue helicopter. That box works out, and you fly in in such a
    way, you actually put a null, an air null, beneath that one
    area. We believe that that will allow us to do combat search
    and rescue (CSAR). If you can do CSAR, you can certainly send
    people down the ropes. But they have had a problem----
        Chairman Warner. Now, time won't permit more detail. I just
    wanted to alert you to a concern.
        My colleague, Senator Levin.
        Senator Levin. Mr. Chairman, thank you. Just on the budget
    issue, the Army chief of staff testified, when he was here,
    that the Army is currently spending $3.7 billion a month in
    Iraq, and $900 million a month in Afghanistan, in incremental
    costs for those operations. Is it not foreseeable that those
    incremental costs are going to continue in the next year, since
    we know it's 110,000 troops rotating in?
        Secretary Brownlee. Sir, that's the current burn rate. I
    anticipate that it might continue somewhat at that level, but I
    don't know. I mean, we could reach a situation where we had to
    send more forces, or we could reach a situation where we might
    draw down.
        Senator Levin. Isn't it reasonably foreseeable that it's
    going to be at least 110,000, since that's your plan?
        Secretary Brownlee. Sir----
        Senator Levin. That is your plan.
        Secretary Brownlee. That's our plan.
        Senator Levin. Well, then why don't we budget for it? This
    isn't in the middle of combat. You have a plan, 110,000 folks.
        Secretary Brownlee. Well, sir, at the time that we
    submitted our fiscal year 2004----
        Senator Levin. No. No, no, now. The question is not whether
    there's a supplemental. That's a given, that there's going to
    be a supplemental. The question is whether we have a
    supplemental in a timely way so that we can avoid some gap in
    there. That's the issue. There's going to be a supplemental for
    2005.
        Secretary Brownlee. Sir, I----
        Senator Levin. The question is, since you're planning
    there's going to be at least 110,000 soldiers in there, why not
    fund for what you're planning? Why not budget for what we're
    planning----
        Secretary Brownlee. Senator----
        Senator Levin.--with a supplemental?
        Secretary Brownlee. If you're talking about the timing of a
    supplemental----
        Senator Levin. Yes.
        Secretary Brownlee.--is that what you're talking about?
    Sir, that's above my level, but I----
        Senator Levin. But have you talked to the Secretary about
    the need for that?
        Secretary Brownlee. It's been discussed in meetings, sir.
    But I'm not sure where he is on that.
        Senator Levin. But have you urged----
        Secretary Brownlee. Whether it's his----
        Senator Levin.--that the supplemental be filed before the
    end of the year so we know that we can properly, without gaps
    in funding, sustain that level of forces in Iraq and
    Afghanistan?
        Secretary Brownlee. Sir, I make my needs known to the OSD
    Comptroller and to the Secretary of Defense. If they believe
    they have sufficient funds to do that, then they tell me that.
    I really don't--I'm not part of their decisionmaking process on
    when supplementals get drawn up or requested.
        Senator Levin. Well, it's really an unsettling answer from
    you, I have to tell you, because we know we're planning on
    110,000 being rotated in, and so that's our plan. Yet we're not
    funding for that plan. So this is a reasonably foreseeable
    expense, because it's based on a plan that we've filed, and so
    I'll express myself on that.
        I guess I'll ask the question again. You've indicated that
    you believe we will need a supplemental at some point.
        Secretary Brownlee. Yes, sir.
        Senator Levin. Are we better off with that supplemental
    before those incremental costs have to be spent? Are we not
    better off having a supplemental for 2005, since we know
    there's incremental costs that are going to be there, in a way
    in which we have the funds to pay those incremental costs as
    they're incurred? Isn't that better budgeting?
        Secretary Brownlee. We would be better off having those
    funds before we had to cash-flow out of other accounts to the
    extent that we did harm to those accounts.
        Senator Levin. All right.
        Secretary Brownlee. But, Senator, because you've been here
    a lot longer than I was around here, that routinely these
    supplementals have been requested and approved by Congress.
    Sometimes when they came too late, yes, it was detrimental. If
    they were timely, the Services were able to adjust and get by.
        Senator Levin. Again, there's no argument over whether
    there's going to be a supplemental, so when you say ``routinely
    there are supplementals,'' that's a given.
        Secretary Brownlee. Yes, sir.
        Senator Levin. The issue is when will this supplemental be
    presented to us.
        Just a couple of other questions. Secretary Brownlee,
    there's a program in Korea, I understand, called the Korean
    Augmentation to the U.S. Army.
        Secretary Brownlee. Yes, sir.
        Senator Levin. Are you familiar with that program?
        Secretary Brownlee. Yes, sir.
        Senator Levin. I think it's called KATUSA?
        Secretary Brownlee. KATUSA program, yes, sir.
        Senator Levin. Where individual Republic of Korean soldiers
    are integrated into our units----
        Secretary Brownlee. Right.
        Senator Levin.--in a number of positions that would
    normally be filled by U.S. soldiers?
        Secretary Brownlee. Yes.
        Senator Levin. This program was begun during the Korean
    War, and apparently has continued with some success. Would that
    program have merit in Iraq?
        Secretary Brownlee. I've asked the same thing, sir. I
    really have. It may have. We're kind of embarked in a little
    bit different direction here than we were in Korea, in that
    right now we are standing up an Iraqi government, or in the
    process of doing that, and I think we want to build some
    institutions there, rather than taking them into ours. But it's
    interesting, I've asked the same question, whether or not that
    might have merit.
        Senator Levin. Would you let the committee know, then,
    about what your thinking is on that----
        Secretary Brownlee. Yes, sir----
        Senator Levin.--as it evolves?
        Secretary Brownlee.--I will. Be happy to.
        [The information referred to follows:]

        The Korean Augmentation to the United States Army (KATUSA) program
    began in July 1950 as a way to supplement under strength U.S. units
    following the outbreak of war in June 1950. The situation in Iraq is
    significantly different than the early months of the Korean War. U.S.
    units deploying to Iraq are at full strength and do not need
    augmentation in order to be combat effective. Additionally, the KATUSA
    program allowed U.S. forces to draw upon trained soldiers in the
    already established Republic of Korea Army. While there may be some
    benefit to integrating a small number of Iraqis into U.S. units to
    provide host-nation language, cultural, and regional expertise, in
    exchange to Iraqi exposure to U.S. leadership, tactics, techniques, and
    procedures, the decision to do so should only be made by the Combatant
    Commander, General Abizaid, and the commander in Iraq, Lieutenant
    General Sanchez.

        Senator Levin. Two quick ones, because we're, I see, in the
    second half of our vote already. This has to do with a comment
    which was made to me by a family support group president for a
    deployed National Guard unit----
        Secretary Brownlee. Yes, sir.
        Senator Levin.--last weekend, telling me that soldiers have
    to wait in line for hours to use the phone in Iraq. When they
    get their calls through, they're charged a connectivity fee
    that could be as high as $9, and then a per-minute fee up to
    $6, again depending on the calling card. Last year, we
    authorized service members who were in Operations Enduring
    Freedom and Iraqi Freedom to be provided, without cost, prepaid
    phone cards for what we thought was an adequate amount----
        Secretary Brownlee. Yes.
        Senator Levin.--120 calling minutes. But apparently that
    provision of the act has not yet been implemented, and I don't
    know why. If it's true, would you find out if, in fact----
        Secretary Brownlee. I will, sir. If you could----
        Senator Levin. Would you also just take a look at this
    problem? Because this----
        Secretary Brownlee. Yes, sir.
        Senator Levin.--is a very striking problem, when we have
    people out there who are being charged apparently that much to
    make phone calls home, when they're not supposed to be charged
    anything to make phone calls home.
        [The information referred to follows:]

        The Armed Services Exchanges provide the unofficial
    telecommunications system using the AT&T network. These services are
    not always readily available due to limited communications
    infrastructure and mission restrictions. However, as of April 2004, the
    Army and Air Force Exchange Service provided over 50 calling centers
    with over 1,600 phones and 640 satellite phones. Calls made from the
    exchange call centers using the AT&T telephone calling cards,
    commercial credit cards, and AT&T prepaid phone cards are not charged a
    connection fee. If a member places a collect call, there is a
    connection fee of $.89 to $6.50. If a member uses the Exchange Global
    AT&T 550 unit prepaid phone card, the calling rates are: $0.19 per
    minute from Kuwait call centers, $0.32 per minute from Afghanistan and
    Iraq call centers, and $0.76 per minute for satellite phones.
        The Defense Department's Defense Switched Network (DSN), an
    official telephone system, is available in some portions of the theater
    of operation. Soldiers in the Iraqi theater of operations, regardless
    of their component, can call at no cost during non-duty hours on the
    DSN system. The DSN connects the caller to a switch operator at the
    installation closest to the destination telephone number. If long
    distance service is required beyond the selected installation, the call
    is connected to a commercial network, from which the soldier may elect
    to use any prepaid card, calling card, and commercial credit card or
    collect service of their choice. On average, more than 50,000 telephone
    calls are made each day using the DSN system.

        Secretary Brownlee. Yes, sir. After the hearing, if I could
    get the information for where that is, there are still some
    isolated spots that continue to get reported where we don't
    have adequate phone service, so I'd like to know where that is.
        Senator Levin. All right. Well, I can't tell you where in
    Iraq it is----
        Secretary Brownlee. Okay.
        Senator Levin.--offhand, but we will give you the name of
    the lady----
        Secretary Brownlee. Okay.
        Senator Levin.--who is in charge.
        There was some discussion about the sexual assaults problem
    that we obviously have here, which seems to be endemic and
    deeper than anybody could have hoped. Does the Army have
    systems in place, and programs in place, in deployed locations
    to offer victims of sexual assaults there the medical and
    psychological and legal help that they need in deployed
    situations?
        Because we're running out of time, let me just----
        Secretary Brownlee. Yes, sir.
        Senator Levin.--raise that, bring it to your attention.
        Secretary Brownlee. I will.
        Senator Levin. If you could give us an answer, for the
    record, to that one.
        Secretary Brownlee. I will.
        [The information referred to follows:]

        The Army remains committed to taking care of every soldier, to
    include dealing expeditiously with any soldier complaint or allegation
    of misconduct and to ensuring that whether in garrison or deployed, the
    support services provided are the same. When a soldier reports a
    possible criminal act, including a sexual assault, the Army is resolved
    to investigate the allegations thoroughly and promptly and to provide
    immediate care and support to the victim. The Army has law enforcement
    and legal personnel who are deployed to the battlefield to assure
    timely investigative support and assistance to commanders and victims.
    We also provide medical care and mental health care expertise to our
    soldiers through our appropriately staffed Combat Support Hospitals in
    Iraq and Afghanistan.
        The Army is dedicated to ensuring that the victims of sexual
    assault receive proper care and treatment and that their medical and
    psychological needs are properly met. To ensure that our current
    policies and programs are effective, the Acting Secretary of our Army
    has directed the establishment of a Task Force to conduct a detailed
    review of the effectiveness of our Army's policies on  reporting and
    properly addressing allegations of sexual assault. This review will
    examine our policies, programs, procedures, and training with regard to
    the prevention of sexual assault. The task force will further review
    the processes in place to ensure a climate exists where victims feel
    free to report allegations and leaders at every level understand their
    responsibilities to support those victims. This task force will render
    its report by the end of May 2004.

        Senator Levin. Secretary England, you and I have talked
    about the civilian personnel issue, and I know that's been
    raised again here today by a number of my colleagues. I'm glad
    it has, I'm glad you're in charge now. I hope you'll, frankly,
    start from ground zero on this one. It got off on the wrong
    foot. There was a lot of effort made by our chairman, by
    Senator Collins, and others here to work out something which
    would preserve collective bargaining rights, which would also
    involve the unions collaboratively in working out the
    processes. I'm glad you're willing to take a fresh look at
    that. That's your assurance to me, personally, and I gather
    your assurance here this morning, and we look forward to that.
        Secretary England. Yes, Senator.
        Senator Levin. Thank you very much.
        Thank you, Mr. Chairman. Thanks to all of our witnesses.
        Chairman Warner. Thank you, Senator Levin, for your very
    strong, constructive participation on this committee.
        I, likewise, have a number of questions, gentlemen--Joint
    Strike Fighter, Joint Unmanned Combat Aerial System, and
    obviously I was going to end up on shipbuilding--but that's not
    possible. We've done our very best under the time constraints
    given this committee today, and I think your responses and
    participation have been very, very constructive and helpful to
    the committee in the continued responsibility we have in
    oversight.
        I said, when we started, I commend each of you for the work
    that you're doing. I continue to finish this hearing with that
    commendation. Well done.
        I also think your chiefs did a very good job the other day,
    Senator Levin----
        Senator Levin. They did, indeed.
        Chairman Warner.--when they appeared before the committee.
    So that civilian uniform team is working for the best interests
    not only for the men and women--for the Armed Forces, but the
    whole Nation. I commend you.
        Thank you very much.
        [Questions for the record with answers supplied follow:]
                   Questions Submitted by Senator Bill Nelson
                    sexual assault at the air force academy
        1. Senator Bill Nelson. Secretary Roche, General Michael Moseley
    recently testified before the Personnel Subcommittee of the Senate
    Armed Services Committee. I would like some clarification of certain
    points he made in the testimony he submitted for the record: First,
    with regards to the sexual assault allegations at the Air Force
    Academy, General Moseley stated that confidentiality for victims has
    proved to be ``difficult to implement'' and that the Air Force
    ``believe[s] it is in America's best interest'' to ``eliminate any
    chance for offenders to commit future crimes.'' Does this statement
    mean that the Air Force has completely abandoned the idea of affording
    confidentiality to victims of sexual assault? If so, I would like a
    more detailed rationale for why the Academy will not offer
    confidentiality to victims.
        Secretary Roche. The Air Force has not abandoned the idea of
    affording confidentiality to victims of sexual assault. As in the past,
    victims always have the option of confidentially reporting an assault
    to a chaplain; Further, in an effort to comply with recommendations of
    the Fowler Commission, the Air Force has drafted a confidentiality
    policy for the Academy with the intention of applying it at the Academy
    Reservation to all military and civilian personnel, and then reviewing
    this policy after appropriate implementation for possible extension to
    the active duty Air Force. However, implementation of this draft policy
    has been delayed as the Department of Defense (DOD) considers the
    legitimate competing interests pertaining to victim needs, command
    responsibilities, and law enforcement obligations. These are matters
    with significant cross-service implications, and we are working with
    DOD towards the resolution of these issues.

        2. Senator Bill Nelson. Secretary Roche, I would like a detailed
    plan as to how the Air Force is going to publicize this denial of
    confidentiality so that women cadets and potential cadets are fully
    informed.
        Secretary Roche. The existing policies and procedures, including
    availability of chaplain confidentiality and off-base referral
    services, have been widely disseminated among academy personnel and are
    a focal point of training for incoming cadets. To the extent we, in
    coordination with the Department of Defense, extend confidentiality to
    other entities, that too will become an integral part of cadet
    education and a matter of public record. Please see the answer to
    Question Number 1.

        3. Senator Bill Nelson. Secretary Roche, General Michael Moseley
    recently testified before the Personnel Subcommittee of the Senate
    Armed Services Committee. I would like some clarification of certain
    points he made in his testimony. General Moseley commented that only a
    ``few'' cases of assault have occurred in the Air Force and that no
    reports of assaults have occurred in Iraq or Afghanistan. He went on to
    state that the Air Force has ``this matter fully in hand'' According to
    DOD's numbers, the Air Force has had at least seven reported cases of
    assault in Operation Iraqi Freedom and Operation Enduring Freedom.
    Additionally, the Air Force is now investigating 20-25 allegations at
    Sheppard Air Force base alone. Is the DOD wrong here and does the Air
    Force really mean to say it has resolved the problem of sexual assault?
    If not, what did General Moseley mean by saying the matter was, ``fully
    in hand?''
        Secretary Roche. The Air Force did report opening investigations
    within the deployed environment in southwest Asia. However, the
    locations involved are Qatar, Kuwait, Oman, Kyrgyzstan, Saudi Arabia,
    United Arab Emirates, and Bahrain. There were no cases in Iraq or
    Afghanistan. The Air Force has been working on our sexual assault
    deterrence and response capabilities since completion of the Working
    Group Report on the Air Force Academy (AFA). As a result of the
    implementation of the Agenda for Change at the AFA, discussions at
    Corona Fall, and the Pacific Air Forces study, General Moseley formed a
    Headquarters Sexual Assault Integrated Planning Team and directed all
    major command commanders to assess their sexual assault deterrence and
    response programs using a specified template. As we have seen at
    Sheppard Air Force Base, these reviews sometimes raise issues and
    allegations covering a considerable span of time that require careful
    examination before any valid conclusions can be drawn. Results and
    recommendations from that effort will be presented at the May Corona
    conference.

        4. Senator Bill Nelson. Secretary Roche, General Michael Moseley
    recently testified before the Personnel Subcommittee of the Senate
    Armed Services Committee. I would like some clarification of certain
    points he made in his testimony: General Moseley quoted a cadet
    commending the Academy on the ``countless number of briefings on sexual
    harassment'' that she received. While I am pleased to know there are
    several briefings on sexual harassment, sexual harassment is not the
    same as sexual assault. Is the Academy also holding numerous briefings
    on sexual assault prevention and education, particularly on what a
    cadet should do if assaulted and what their rights are?
        Secretary Roche. Sexual assault is clearly not the same thing as
    sexual harassment. The Academy has an extensive program of training
    addressing sexual assault, to include what a cadet should do if
    assaulted and what the rights of the victim are. The Academy Response
    Team (ART) takes an active role in education of both cadets and
    faculty/staff in the areas of sexual assault and sexual harassment.
    Several examples;

             The ART proactively briefed each cadet squadron on the
            new sexual assault reporting process (37 1-hour discussion
            sessions.)
             Each cadet receives a wallet/purse card that outlines
            sexual assault reporting and response.
             Nationally recognized civilian experts train both
            Academy leadership and cadets on the realities of non-stranger
            sexual assault and victim/perpetrator psychology.
             Commander's Guidance 05-8, 27 May 03, Sexual Assault
            Reporting Process, explains the role of the ART and how all
            United States Air Force Academy personnel are to report
            allegations of sexual assault.
             The Academy Counseling Center has a 4-year
            developmental training plan covering sexual assault and
            harassment, Military Equal Opportunity, human relations, and
            substance abuse for each of the classes.

        5. Senator Bill Nelson. Secretary Roche, if these sexual assault
    briefings are held separately from the sexual harassment briefings, is
    it in order to underscore the difference in severity and any
    differences in the procedures following an assault as opposed to an
    incident of harassment?
        Secretary Roche. Preventive education and training at United States
    Air Force Academy (USAFA) discusses both the similarities and
    differences between sexual harassment and sexual assault. Some of the
    sexual assault/harassment training is separate and distinct, but some
    of the training is combined because a benefit can be gained by viewing
    this negative behavior along a continuum. At one end there's the lesser
    forms of sexual harassment (inappropriate jokes, glances, pornographic
    material inappropriately displayed, etc.) On the other end is sexual
    assault (physical assault). In between the two ends, there are various
    levels of inappropriate behavior. We educate the cadets that if you do
    not confront sexual harassment, it creates an environment where sexual
    assaults may be more likely to occur. In addition, USAFA provides
    assertiveness training to all incoming fourth-class cadets, both male
    and female. This covers what is, and what is not, a legal order and
    what their rights are in a training environment. They are taught that
    if something doesn't seem right, then speak up and tell someone about
    it. All cadets are educated that sexual assault is a crime, as are many
    forms of sexual harassment, and neither will be tolerated. Our intent
    is to educate and encourage cadets to confront negative behaviors as
    soon as possible. Behaviors associated with sexual harassment can be
    forwarded for investigation through official Military Equal Opportunity
    channels. Alleged sexual assaults are reported to the Academy Response
    Team, which initiates victim support from helping agencies and starts
    the official investigation through the Air Force Office of Special
    Investigations.

                         carrier basing in the atlantic
        6. Senator Bill Nelson. Secretary England, Congress has been
    interested since at least the early 1980s about ensuring that the Navy
    has considered the implications of relying on only one base of
    operations on the Atlantic Coast for nuclear-powered aircraft carriers.
    The Navy has consistently resisted engaging meaningfully on analysis,
    risk assessment, or commitment to establishing a second such base.
    Since arriving in the United States Senate just over 3 years ago, I
    have consistently argued that the Nation needed to reduce its strategic
    risk in the stationing of aircraft carriers on the Atlantic Coast by
    committing to no fewer than two bases capable of home porting nuclear
    aircraft carriers. Since the terrorist attacks of September 11, 2001, I
    believe that the strategic risk associated with having all our Atlantic
    nuclear carriers in one port is even more acute. During the time that
    Congress has been encouraging the Navy to address this issue, the Navy
    established a second Pacific coast nuclear carrier base in San Diego,
    California, even before the base at Alameda was considered for closure
    under the Base Realignment and Closure (BRAC) process. Why has the Navy
    taken such a different approach in dealing with the strategic basing
    posture on the two coasts? Specifically, why has the Navy concluded
    that we needed two nuclear carrier bases on the Pacific coast and has
    failed thus far to establish one on the Atlantic?
        Secretary England. From a fleet-wide perspective, the Navy has
    dispersed its carrier assets to multiple locations. The Navy has its
    aircraft carriers (CV and CVN) at six different homeport locations
    (Norfolk, Virginia; Mayport, Florida; Everett, Washington; Bremerton,
    Washington; San Diego, California; and Yokosuka, Japan). Additionally,
    many of our ports are nuclear-carrier port capable (such as Mayport)
    and could berth a nuclear carrier for an interim period if a particular
    threat necessitated the need for further dispersal of our carrier
    assets. The cost to establish an additional nuclear carrier homeport at
    this time would take away from higher priority fleet requirements.

        7. Senator Bill Nelson. Secretary England, did the Navy conduct any
    analysis that led to the decision to establish a second nuclear carrier
    port on the Pacific coast? If it did, please provide a copy of this
    analysis.
        Secretary England. Yes. To support the homeporting decision of
    three Nimitz-class aircraft carriers on the Pacific Coast, the Navy
    completed an Environmental Impact Statement that weighed the advantages
    and disadvantages of the various candidate bases. A copy of the Record
    of Decision, which followed the completion of the Environmental Impact
    Statement, is attached.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        8. Senator Bill Nelson. Secretary England, has the Navy performed
    any analysis of the current strategic conditions, force protection, and
    risk relative to the establishment of a second base on the Atlantic
    coast for nuclear-powered aircraft carriers? If not, why not?
        Secretary England. The Navy carefully reviews threats to all of our
    bases, not just those with aircraft carriers. These factors are a major
    part of our analysis in support of the 2005 Base Realignment and
    Closure (BRAC) process and were included in the recent 20-year force
    structure review. In addition, the BRAC analysis will also take into
    consideration the dramatic change in the international security
    environment and its relationship to our strategic posture, particularly
    with respect to our carriers. On November 25, 2003, the President
    announced that the U.S. was planning to modernize its global defense
    posture. His announcement initiated a consultative process, with
    friends, allies, and partners that will precede any decisions on
    posture changes. Directly related is the Integrated Global Presence and
    Basing Strategy (IGPBS), initiated in March 2003 to explore changes to
    the pre-September 11 U.S. military posture. This effort is still
    ongoing.
        The Navy continuously evaluates strategic conditions and force
    protection requirements. This process allows the Navy to respond to
    current world conditions and adapts our future force structure to
    respond to emerging threats.

        9. Senator Bill Nelson. Secretary England, how do the increased
    strategic threat and requirements for force protection affect the risk
    assessment relative to an analysis of an Atlantic coast nuclear carrier
    base?
        Secretary England. The Navy continues to review the risk assessment
    of our current force structure to ensure the safety and security of our
    sailors and naval assets. In cases of heightened risk, the fleet
    generally departs that risk area to minimize the overall concern. For
    example, in the advent of a hurricane on the Atlantic Ocean that is
    forecasted to threaten our naval bases on the east coast, the fleet
    typically sorties available assets to weather the storm at sea and
    invariably serves to better protect the fleet. If the Navy determines
    that the strategic threat and existing force protection concerns exceed
    the ability of our available infrastructure to adequately protect our
    sailors and naval assets, additional measures including the strategic
    homeporting of the carrier assets to decentralize the fleet will be
    considered.

        10. Senator Bill Nelson. Secretary England, what were the costs (in
    then year and current dollars) that the Navy incurred in establishing a
    second nuclear carrier base on the Pacific coast?
        Secretary England. The cost for Nuclear Powered Aircraft Carrier
    (CVN) homeporting and maintenance facilities at Naval Air Station North
    Island, California, was $220 million (then-year dollars). These
    facilities included a new wharf, dredging, and three depot-level
    maintenance facilities. In current-year dollars, the cost for these
    facilities would be $260 million.

        11. Senator Bill Nelson. Secretary England, how much would it cost
    to establish a second base on the Atlantic coast?
        Secretary England. The Navy prepared a Programmatic Environmental
    Impact Statement to evaluate the facilities necessary to support the
    replacement of a conventional aircraft carrier (CV) with a Nimitz-class
    aircraft carrier (CVN) at Naval Station Mayport, Florida. The Record of
    Decision, issued in August 1997, indicated that Mayport is a feasible
    homeport site should the Navy define such a need in the future
    providing that the identified construction, renovations, and dredging
    could be accomplished. Approximately $157 million for facilities
    (including wharf improvements, dredging, and maintenance facilities)
    and $34 million for industrial maintenance equipment would be required
    to establish a CVN-capable homeport at Mayport. The required military
    construction to support a CVN homeport at Naval Station Mayport was not
    included in the fiscal year 2005 FYDP.

        12. Senator Bill Nelson. Secretary England, if the Chief of Naval
    Operations were to recommend that the Navy establish a second Atlantic
    coast nuclear carrier base, would you support him and find the funds
    necessary in the Navy budget to implement that recommendation?
        Secretary England. I highly value the CNO's opinions and give all
    of his recommendations utmost consideration. However, I consider it my
    responsibility to scrutinize significant capital investments that would
    be required to support a second nuclear carrier base on the east coast.
    That said, I consider it unlikely that he would make a recommendation
    to establish a new nuclear carrier base while the BRAC process is in
    progress.

                          base realignment and closure
        13. Senator Bill Nelson. Secretary England, a concern that I have
    regarding the upcoming BRAC process is that DOD and Service civilian
    leaders may be predisposed to discount or ignore the views of the
    Services' uniformed professional leadership. How will you weigh the
    advice of the Chief of Naval Operations and the Navy staff? If the
    uniformed leadership of the Navy recommends that the Service retain an
    installation, facility, activity, or capability, such as the Navy's
    three naval aviation depots, will you support them throughout the BRAC
    process?
        Secretary England. I value highly the advice of the Chief of Naval
    Operations and the Navy staff. The BRAC 2005 process identified by the
    Secretary of Defense memo of November 15, 2002, clearly states the
    involvement of both the senior uniformed and civilian professional
    leadership of all of the military departments.
        The Defense Base Closure and Realignment Act of 1990, as amended by
    National Defense Authorization Act for Fiscal Year 2002 (the act) sets
    out a very fair process with very specific timelines and milestones to
    which the Department of Defense must adhere in developing its
    recommendations for closure and realignment. The recommendations are
    based on the act and the published Selection Criteria. I am confident
    that the uniformed and civilian leadership of the Department of the
    Navy and the Department of Defense will develop recommendations fairly
    and consistent with the selection criteria.

        14. Senator Bill Nelson. Secretary Roche, a concern that I have
    regarding the upcoming BRAC process is that DOD and Service civilian
    leaders may be predisposed to discount or ignore the views of the
    Services' uniformed professional leadership. How will you weigh the
    advice of the Air Force Chief of Staff and the Air Force staff? If the
    uniformed leadership of the Air Force recommends that the Service
    retain an installation, facility, activity, or capability, such as the
    Air Force's test and evaluation centers, will you support them
    throughout the BRAC process?
        Secretary Roche. The Air Force BRAC 2005 process fully incorporates
    both uniformed and civilian leadership viewpoints.
        Both the Chief of Staff and I sit on the Secretary of Defense's
    BRAC 2005 Infrastructure Executive Committee chaired by the Deputy
    Secretary of Defense. Our viewpoints are, and will continue to be
    raised as we prepare the Department's base realignment and closure
    recommendations. Likewise, the Vice Chief of Staff and the Assistant
    Secretary of the Air Force (Installations, Environment and Logistics)
    sit on the Department's joint Infrastructure Steering Group (ISG). The
    ISG meets at least every 3 weeks as it directs the BRAC 2005 process.
        As prescribed by the BRAC statute, the Air Force BRAC 2005 process
    is grounded on an evaluation of Military Value focused on our goals of
    optimizing operational capability inherent in our U.S. installations,
    including our logistics, research, development, acquisition, and test
    and evaluation centers. Military value is central in shaping our
    recommendations.
                                     ______

             Questions Submitted by Senator Hillary Rodham Clinton
                              military outsourcing
        15. Senator Clinton. Secretary Brownlee, the Army plans to begin
    the process of converting some military positions to civilian in order
    to improve manpower efficiency and better support worldwide
    commitments. What are the long-term costs of this transition and where
    are they reflected in budget estimates?
        Secretary Brownlee. The Army plans to begin converting 9,000
    military positions to civilians in fiscal year 2005 and an additional
    in 6,000 by in fiscal year 2006. Army commands are currently developing
    detailed transition plans. The cost to initiate these conversions in
    fiscal year 2005 is $190 million and is reflected in various accounts
    within the Operation and Maintenance, Army budget request. The Army
    will program for the costs beyond fiscal year 2005 as part of the
    program and budget process this summer. An additional $4.5 billion in
    budget authority will be sufficient to cover these conversions when
    combined with other cost saving measures.

                            army corps of engineers
        16. Senator Clinton. Secretary Brownlee, the President's budget
    calls for a cut of 13.1 percent in the Army Corps of Engineers budget.
    What impact will this have on current Corps of Engineers projects,
    clean-up efforts, civil works, and military construction initiatives?
        Secretary Brownlee. The Corps of Engineers is part of the Army, and
    as such I provide oversight and direction to its activities. I delegate
    the details of oversight of the Civil Works program to the Assistant
    Secretary of the Army for Civil Works, John P. Woodley, Jr., who
    oversees the policy and direction of the Civil Works program of the
    Corps of Engineers, including the budget for fiscal year 2005.
    Assistant Secretary Woodley keeps me apprised of significant
    occurrences affecting the program. As the acting Assistant Secretary
    for Civil Works, I had overseen the formulation of the fiscal year
    2003-2004 budgets and, prior to Mr. Woodley's appointment, the initial
    phases of formulation of the fiscal year 2005 budget.
        The proposed fiscal year 2005 Civil Works budget is frugal,
    representing the tough choices that must be made during a time when the
    Nation is at war. It embodies both prudent management and the targeting
    of funding to priority work. It accelerates high priority work, dam
    safety projects, fiscal year 2005 completions, and includes some new
    starts. But, given the war and the President's overall priorities, the
    amount of funding available for the Civil Works program was limited.
    With the available funding, the Corps of Engineers is making
    significant progress on all budgeted projects. There are many competing
    needs throughout the country but I assure you that the Corps of
    Engineers will make the best use of the Civil Works funds provided.
        The Corps of Engineers activities related to clean up of current
    and former military sites and to military construction are funded
    through appropriations to the Department of Defense for these and other
    military purposes. Consequently, changes from year to year in the Civil
    Works budget would have no impact on these activities.

        17. Senator Clinton. Secretary Brownlee, how will the Corps of
    Engineers be cut or reduced to meet this budget decrease?
        Secretary Brownlee. Since the Corps staff is primarily project
    funded, it must carefully consider the impact of its annual
    appropriations, the trend, and future prognosis, in order to manage its
    workforce. Although there may be some individual management actions
    necessary to accommodate the budget, it is not anticipated that there
    will be any widespread or general reductions in the workforce.

                                   jointness
        18. Senator Clinton. Secretary Roche and Secretary England, the Air
    Force and Navy have expressed how jointness is an integral part of how
    they operated in Operation Enduring Freedom (OEF) and Operation Iraqi
    Freedom (OIF). What efforts are being taken to integrate joint
    education into Service schools now instead of having the first
    opportunity for an Non-Commissioned Officer (NCO) or officer to
    experience jointness late in their career?
        Secretary Roche. The Chairman of the Joint Chiefs of Staff, as
    defined by law, is responsible for formulating policies for
    coordinating the military education and training for members of the
    armed forces and provides oversight through certification and
    accreditation processes. The Professional Military Educational (PME)
    Framework identifies areas of emphasis at each educational level and
    provides joint curriculum guidance for PME institutions. The framework
    structures the development of sister service and joint officers by
    organizing the officer PME system into five military educational
    levels, precommissioning, primary, intermediate, senior, and general
    officer/flag officer. Similar levels of PME exist for the enlisted
    force (airman, noncommissioned officer, senior noncommissioned
    officer). Each level builds upon the knowledge and values gained at
    previous levels.
        The Officer Professional Military Education Policy (OPMEP) document
    (CJCSI 1800.01A) addresses the Goldwater-Nichols Act mandates for
    officer joint education. The Air Force implements the OPMEP throughout
    the officer continuum of education, from precommissioning to senior
    service school level by addressing the specific learning areas and
    objectives prescribed in the OPMEP. At the precommissioning level,
    cadets learn the basic United States defense structure, roles and
    missions of other military services, the combatant command structure,
    and the nature of American military power and joint warfare. At the
    primary level (Air and Space Basic Course and Squadron Officer School),
    instruction addresses the fundamentals of joint warfare, joint task
    force organization, the characteristics of a joint campaign, how
    national and joint systems support tactical-level operations, and the
    capabilities of the relevant systems of other services. Wargames
    demonstrate the teamwork required to successfully plan a joint air and
    space campaign. At the intermediate level (Air Command and Staff
    College), PME instruction addresses joint operations from the
    standpoint of the Air Force forces in a joint force supported by
    Service component commands. Students study warfighting, military
    doctrine, and the application of unified, joint, and combined forces,
    with particular emphasis on air and space power employment in theater-
    level operations. A comprehensive wargame enables students to apply
    their knowledge and skill to build a theater-wide plan for joint air
    operations. At the senior PME level (Air War College), instruction
    addresses theater and national level strategies and processes.
    Curriculum focuses on how the unified commanders, Joint Staff, and
    Department of Defense (DOD) use the instruments of national power to
    develop and carry out national military strategy. Students examine how
    the joint operational planning and execution system is integrated in
    theater and operational information operations (IO) campaign planning
    and execution to support theater and national strategic sustainment and
    warfighting efforts. During wargames, students apply knowledge gained
    during the academic year in a complex global scenario. Students are
    confronted with international and homeland security challenges which
    must be dealt with through diplomatic information, economic, and
    military responses. This reinforces the importance of thinking with
    joint, interagency, and coalition perspectives.
        Beyond the senior service school level, the Air Force provides
    joint education for its general officers via the Joint Flag Officer
    Warfighting Course (JFOWC) and the Joint Forces Air Component Commander
    Course (JFACO). JFOWC provides future theater combatant commanders,
    service component and joint task force (JTF) commanders with a broad
    perspective of the strategic and operational levels of war. Instruction
    addresses issues such as the role of joint doctrine with respect to
    unified command as it applies to operations planning, mobilization,
    deployment, employment and sustainment, and redeployment; the combatant
    commander's perspective and the role of subordinate commanders in
    developing, deploying, employing and sustaining military forces; the
    role of the unified commander in developing theater plans, policies and
    strategy; how the joint operational planning and execution system is
    integrated in theater and operational IO campaign planning and
    execution; and the complexities associated with leadership in a
    coalition environment at the task force, component and combatant
    commander levels. The JFACC course is designed to prepare potential
    JFACCs for theater-level combat leadership responsibilities. The
    attendees study warfighting, military doctrine, and the application of
    unified, joint, and combined combat forces with particular emphasis on
    air and space power employment in theater-level operations.
        Joint Education is also integrated within Air Force Enlisted PME
    Programs. The Airman Leadership School, a basic course to prepare
    airmen (E-4) for their role as NCOs and leaders, presents primary
    instruction on roles and missions of the military services, joint
    operations, and homeland defense. The Noncommissioned Officer Academy,
    an intermediate course furthering the professional development of
    technical sergeants (E-6), provides intermediate instruction on the
    same topics, and adds joint force components, military planning, and
    transformation. The United States Air Force Senior Noncommissioned
    Officer Academy (SNCOA), the (U) senior course broadening the military
    education of senior noncommissioned officers (E-7/E-8), addresses
    various joint topics, including: Joint Force Command, operational
    concepts, joint perspectives, and joint doctrine. At present, the SNCOA
    is the only Air Force enlisted PME school integrated with senior
    enlisted members from other DOD and international services.
        In addition to formal in-residence PME schools, the Air Force
    provides other media addressing joint topics. Promotion-eligible
    enlisted (E-4 through E-9) prepare for examination through year-long
    study of military subject matter within AFP 36-2241 Volumes 1 and 2, 1
    July 2003. Joint topics included in these study guides are: DOD command
    authority, roles and missions of the military services, military
    justice, and Air Force role in the joint force. Also, AFMAN 10-100,
    Airman's Manual, 1 August 1999, identifies the skills and knowledge
    needed to ``go anywhere, anytime'' to support the Aerospace
    Expeditionary Force mission. It addresses subjects such as Chairman,
    Joint Chiefs of Staff rules of engagement, Law of Armed Conflict, and
    skills needed for deployment.
        Secretary England. The Navy follows the Joint Professional Military
    Education (JPME) Program developed by the Chairman of the Joint Chiefs
    of Staff to progressively develop the knowledge, analytical skills,
    perspectives, and values essential for U.S. officers to function
    effectively in joint, multinational and interagency operations. Joint
    education commences at the Naval Academy, Naval Reserve Officers
    Training Corps Units, Officer Candidate School and other service
    accession schools with an introduction to jointness focused on national
    military capabilities and organization, and the fundamentals of joint
    warfare. Joint education continues at warfare and specialty training
    schools where joint awareness is developed through an emphasis on joint
    warfare fundamentals and joint campaigning. Mid-career naval officers
    receive joint education focused on joint force employment and
    warfighting from the Naval War College through resident or distance
    learning options.
        JPME for the enlisted force is under development. Navy is actively
    involved with the other services and the Joint Staff in policy and
    program development.

                          base realignment and closure
        19. Senator Clinton. Secretary Roche, most of the focus for the
    Global Defense Posture Review, in conjunction with Base Realignment and
    Closure (BRAC) 2005, has been devoted to how many Army divisions or
    brigades may be redeployed to the United States. What possible Air
    Force organizational changes are foreseen in Europe during the review?
        Secretary Roche. [Deleted.]

        20. Senator Clinton. Secretary Roche, if there is a plan to re-
    station airmen to the continental United States, will they be based at
    current Air Force bases or is it possible they may be shifted to the
    Air Force Reserve/Air National Guard?
        Secretary Roche. The United States Air Force has no approved plans
    that would re-station airmen to the continental United States (CONUS).
    Should aircraft and airmen return to the CONUS, an early consideration
    is to balance the supportability of existing fleets.
                                     ______

                   Questions Submitted by Senator Mark Pryor
                             interceptor body armor
        21. Senator Pryor. Secretary Brownlee, the 39th Reserve Brigade
    from Arkansas is about to depart for Iraq, where it will be part of the
    1st Cavalry Division. I visited the 39th at Fort Hood last month and
    Fort Polk a couple of weeks ago to observe some of their training. I
    repeatedly hear from family members of the soldiers from the 39th who
    want to know when their loved ones will receive their personal body
    armor. On November 19, 2004, you testified before this committee
    stating that our troops in Iraq would have interceptor body armor by
    December 31, 2003. In fact, you stated, at currently planned rates of
    production, we will have all our troops in Iraq fitted with interceptor
    body armor by the end of December. Why didn't the armor arrive as
    promised?
        Secretary Brownlee. While the Army met the requirement that I
    briefed during my November 19, 2003, appearance before the committee,
    the Combined Joint Task Force-7 requirements for small arms protective
    inserts (SAPI) in Iraq increased on November 22, 2003, by over 10,000
    sets. The Army completed the delivery of the additional 10,000 sets in
    January 2004. The increase was the result of an in-theater recount and
    revised guidance from U.S. Central Command (CENTCOM) directing all
    Service members and Department of Defense civilians in the CENTCOM area
    of responsibility receive Interceptor body armor.

        22. Senator Pryor. Secretary Brownlee, in December 2003, I made an
    inquiry to the Army on when the 39th would receive their interceptor
    body armor. I was originally told that the 39th would receive their
    body armor at Fort Hood. That didn't happen. Now, I'm told that the
    body armor will be provided in Kuwait. Why hasn't this armor arrived as
    promised?
        Secretary Brownlee. The 39th Reserve Brigade was fielded their
    outer tactical vests prior to deployment from Fort Hood, Texas. At the
    time of deployment, all Small Arms Protective Insert (SAPI) production
    was being shipped directly into theater to Camp Victory, Kuwait. All
    Operation Iraqi Freedom 2 units were issued SAPI in-theater while
    executing their reception, staging, onward-movement, and integration
    phase of operations prior to crossing into Iraq.

        23. Senator Pryor. Secretary Brownlee, what assurances can you give
    me that the members of the 39th will receive interceptor body armor in
    Kuwait?
        Secretary Brownlee. The 39th is scheduled to receive their SAPI at
    Camp Victory, Kuwait on or about March 15, 2004.

        [Whereupon, at 11:49 a.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                            THURSDAY, MARCH 4, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

        UNIFIED AND COMBATANT COMMANDERS ON THEIR MILITARY STRATEGY AND
                            OPERATIONAL REQUIREMENTS

        The committee met, pursuant to notice, at 9:40 a.m. in room
    SH-216, Hart Senate Office Building, Senator John Warner
    (chairman) presiding.
        Committee members present: Senators Warner, McCain, Inhofe,
    Roberts, Allard, Sessions, Collins, Ensign, Talent, Chambliss,
    Graham, Dole, Cornyn, Levin, Kennedy, Byrd, Lieberman, Reed,
    Akaka, Bill Nelson, E. Benjamin Nelson, Dayton, Bayh, Clinton,
    and Pryor.
        Committee staff members present: Judith A. Ansley, staff
    director; and Leah C. Brewer, nominations and hearings clerk;
        Majority staff members present: Charles W. Alsup,
    professional staff member; Regina A. Dubey, research assistant;
    William C. Greenwalt, professional staff member; Ambrose R.
    Hock, professional staff member; Gregory T. Kiley, professional
    staff member; Thomas L. MacKenzie, professional staff member;
    Lucian L. Niemeyer, professional staff member; and Lynn F.
    Rusten, professional staff member.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; Daniel J. Cox, Jr., professional
    staff member; Evelyn N. Farkas, professional staff member;
    Richard W. Fieldhouse, professional staff member; Michael J.
    McCord, professional staff member; and William G.P. Monahan,
    minority counsel.
        Staff assistants present: Michael N. Berger, Andrew W.
    Florell, and Nicholas W. West.
        Committee members' assistants present: Christopher J. Paul,
    assistant to Senator McCain; John A. Bonsell, assistant to
    Senator Inhofe; Darren Dick, assistant to Senator Roberts;
    James P. Dohoney, Jr. and Derek J. Maurer, assistants to
    Senator Collins; Aleix Jarvis, assistant to Senator Graham;
    Christine O. Hill, assistant to Senator Dole; Mieke Y. Eoyang
    and Jarret A. Wright, assistants to Senator Kennedy; Frederick
    M. Downey, assistant to Senator Lieberman; Elizabeth King,
    assistant to Senator Reed; Davelyn Noelani Kalipi, assistant to
    Senator Akaka; William K. Sutey, assistant to Senator Bill
    Nelson; Eric Pierce, assistant to Senator Ben Nelson; Andrew
    Shapiro, assistant to Senator Clinton; and Terri Glaze,
    assistant to Senator Pryor.

           OPENING STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner. The committee will get under way. We
    welcome our two distinguished guests, General Abizaid and
    General Jones. General Jones, we have an unusual guest here
    this morning. Would you take a moment to introduce him before I
    begin my remarks?
        General Jones. Mr. Chairman, I will be happy to. It is a
    great honor to introduce to the committee Admiral Rainer Feist
    of the German Navy, who currently serves as the Deputy Supreme
    Allied Commander for Europe. Admiral Feist and I work together
    on a daily basis on North Atlantic Treaty Organization (NATO)
    affairs at Supreme Headquarters Allied Powers Europe (SHAPE) in
    Mons, Belgium.
        I am particularly honored to be able to present him to the
    committee. He is a distinguished sailor. He is an expert in all
    things NATO and he has made my life professionally and
    personally very enjoyable in my first year in office. I am very
    proud to call him my friend and very proud to rely on him for
    the generation of NATO's forces. In every operation that we are
    engaged on--and there are more and more of those in NATO--
    Admiral Feist has the responsibility of generating the force
    from nations.
        Second, it might interest the committee to know that he is
    also the senior officer assigned to SHAPE with European Union
    (EU) connections. His strategic leadership of Operation
    Concordia in the Former Yugoslavian Republic of Macedonia was
    the departure of the military to military relationship between
    NATO and the EU. So he is singularly qualified to brief the EU
    and the committees of jurisdiction that have interests in
    European security defense initiatives, and he will be extremely
    important this year in whatever happens in Bosnia with regard
    to the policing mission that the EU will hopefully take over,
    as well as the gradual winding down of the traditional NATO
    military mission.
        So I am very proud to introduce Admiral Feist to you, Mr.
    Chairman, and to the committee. He is a great sailor, he is a
    great friend, a great ally, and I depend on him every single
    day.
        Thank you, sir.
        Chairman Warner. We thank you, General, for taking this
    initiative.
        The committee meets today to receive the testimony from
    Commanders, U.S. Central Command (CENTCOM) and U.S. European
    Command (EUCOM), on the posture of the Armed Forces in their
    areas of responsibility (AOR), their overall military strategy,
    and their operational requirements, in review of President
    Bush's defense budget request for fiscal year 2005 and the
    Future Years Defense Program (FYDP).
        Our witnesses today command forces that stretch across the
    Atlantic, across Europe, through Africa, the Middle East, and
    into Central and Southwest Asia. General Jones and General
    Abizaid, we welcome you back before the committee and commend
    you for the outstanding leadership that you have given, are
    giving, and I am confident will continue to give in the months
    and years to come.
        You serve in an era of unprecedented challenges and demands
    on the Armed Forces of our Nation and the coalition nations
    which each of you share responsibility for.
        I start today by recognizing the men and women of our Armed
    Forces, as this committee always does each time we have a
    hearing, who, together with the coalition of nations, liberated
    Iraq, a country larger than Germany and Italy combined, in
    roughly 3 weeks time. This remarkable military accomplishment
    is proof of the professionalism and dedication of our military
    forces. Iraq, a nation that for decades had known only tyranny
    and oppression, is now moving forward to a future of democracy,
    freedom, and opportunity for all of its people.
        The world is a safer place and Iraq, Afghanistan, and the
    Balkans are better places because, along with many nations, the
    U.S. confronted brutal regimes which had repressed their
    people, murdered indiscriminately, fomented terrorism, and
    defied the will of the international community for years.
    Disagreements may continue about the process and the timing by
    which the decision to use force was made, but on one thing
    there is no disagreement: The professionalism, the performance,
    and the sacrifice of our troops and their families was, is, and
    always will be inspiring. For that we are very grateful.
        Every American is justifiably proud of the U.S. Armed
    Forces. The security of America is in good hands.
        As we meet this morning, hundreds of thousands of our
    servicemembers are engaged in operations throughout your AORs,
    defending our Nation in Operation Enduring Freedom (OEF), in
    Operation Iraqi Freedom (OIF), in the Balkans, and in other
    military operations in the ongoing global war on terrorism.
        These brave men and women and their families deserve our
    continued support, and they will get it: the equipment, the
    resources, the support they need to perform their missions. Our
    forward-deployed forces are and will remain our first line of
    defense. This committee's responsibility will continue to be to
    ensure that these troops remain the best equipped, best
    trained, and most capable forces in the world.
        In doing so, we must understand the challenges they face
    today and those they will face tomorrow. The insights of our
    witnesses today are an indispensable part of that process of
    understanding and oversight by this committee.
        We have a number of important issues to discuss. General
    Abizaid, continuing military operations in Iraq, the overall
    security situation there, and the transition to sovereignty and
    democracy are clearly of great interest to this committee. As
    we speak, one of the largest troop rotations since World War II
    is under way in your AOR. The challenges you face in
    accomplishing this movement of forces are daunting. The
    environment in which our troops will operate after the transfer
    of sovereignty and your relationship with the new Iraqi
    government are subjects on which we seek your views.
        While much attention is focused on Iraq, we must not lose
    sight of the other challenges in your AOR. The security
    situation in Afghanistan remains unsettled. Reconstruction is
    ongoing but uneven. Drug cultivation is up and the hunt for
    Osama bin Laden and his associates continues. The committee
    looks forward to your assessment of the current situation in
    Afghanistan as well as your views on NATO's contribution to
    stabilization operations in that region. I very much enjoyed
    your personal report last night that Senator Stevens and I
    received during the course of our visit.
        The continuing cooperation of Pakistan is essential for
    success in this endeavor. The committee is interested in your
    thoughts on the current situation in Pakistan and the
    commitment of the Pakistani Government to be ongoing global
    partners in that area.
        The global war on terrorism continues in other areas, such
    as the Horn of Africa. Your assessment of overall progress to
    date in your region, as well as your thoughts on what remains
    to be done, will be helpful. I ask that you include comments on
    Iran's role in harboring elements of al Qaeda and what progress
    has been made in gaining better cooperation, if that is
    achievable at all, with Iran in the war on terrorism.
        Unfortunately, progress toward finding peace in Israel and
    the Palestinian conflict appears to be at somewhat of a
    standstill. I ask both of our witnesses for their views on that
    conflict. That is a matter that you and I discussed at some
    length, General Jones, yesterday.
        General Jones, the committee looks forward to your insights
    on the developments in the EUCOM AOR, as well as your views on
    the 2005 defense budget request meeting your operational needs.
    NATO will soon grow to 26 members when the 7 newest members
    formally join the alliance early this spring. That will be a
    momentous occasion. I am quite interested in your views on
    their timing to begin to posture themselves financially, to
    take on their share of responsibility for equipment and
    manpower.
        So I look forward, as does the committee, to your views on
    many issues, as well as the progress current NATO members are
    making with respect to the commitment they made in the 2002
    Prague Summit to improve their military capabilities and to
    establish a quick reaction NATO response force.
        For the first time in history, NATO has assumed a critical
    out-of-area mission. In August 2003, NATO assumed the
    leadership of the International Security and Assistance Force
    (ISAF) in Afghanistan. The committee is particularly interested
    in NATO's plan to expand ISAF beyond the Kabul area by
    deploying additional Provincial Reconstruction Teams into the
    countryside.
        Eighteen of 26 member nations and aspirant nations have
    troops deployed in Iraq as part of the OIF. NATO as an alliance
    is currently providing assistance to a number of these NATO
    member countries, including Poland, Spain, and Hungary, to help
    them with their deployments in Iraq. So you have a very
    significant presence there. This represents a commitment to OIF
    by both NATO member nations and NATO as an alliance. The
    committee is very interested to hear of any planning or
    discussions ongoing in NATO regarding an even larger role for
    NATO in Iraq in the coming months, hopefully, and then
    particularly after sovereignty is transferred on June 30.
        Africa is also a very important region in your AOR. I
    visited Liberia last year at your invitation, General Jones, as
    we had a significant number of U.S. forces deployed at the
    direction of the President. I think it was a proper step for
    the President and this country to have taken. We continue to
    monitor that process. I met with the head of government in
    Liberia here a short time ago.
        Another region of great interest to this committee is the
    Balkans. We look forward to your assessment of the political-
    military situation there and the plans of NATO forces in Bosnia
    and Kosovo in the future.
        Finally, the committee remains keenly interested in the
    Department of Defense's (DOD) global force posture review. We
    are eager to hear what each of you are able to share regarding
    the disposition of current and future bases and forward
    operating locations in your respective AORs. As you are aware,
    changes in our global force posture could have dramatic
    implications for future U.S. military readiness and operations,
    for relations with our friends and allies around the globe, and
    for the quality of life of U.S. servicemembers and their
    families.
        I welcome you again, gentlemen.
        Senator Levin.

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman. Let me join you in
    extending a warm welcome to our witnesses this morning. Both
    General Abizaid and General Jones exercise command over forces,
    both U.S. and allied, that are participating in stability and
    combat operations in areas that provide really daunting
    challenges to us.
        I want to also join the chairman and every member of this
    committee in expressing through you our deep gratitude to all
    the men and women under your command for their bravery, their
    dedication, and their sacrifice, and also to their families who
    share in that sacrifice.
        Mr. Chairman, it is fitting that General Abizaid and
    General Jones are appearing together before this committee.
    Their AORs adjoin each other. They are linked to each other.
    NATO has a substantial presence in a growing involvement in
    Afghanistan pursuant to a United Nations (U.N.) Security
    Council mandate. The forces of a number of NATO member nations
    are employed in Iraq and there are suggestions that NATO take a
    formal role in Iraq in the future.
        Afghanistan presents a mixed picture. The Afghan people
    have approved a new constitution. A representative interim
    government is up and running, and presidential and
    parliamentary elections are scheduled to be held in June of
    this year. Meanwhile, however, there are doubts that the
    security situation will allow elections to be held throughout
    the country, at least in that time period. Although NATO has
    decided to become more deeply involved in Afghanistan and a new
    NATO Secretary General has said that Afghanistan is NATO's top
    priority, it is not clear that NATO member nations will provide
    the manpower and equipment that will be needed to fulfil the
    alliance's political commitment.
        There are legitimate questions as to whether the U.S.
    coalition and the Afghan army have sufficient numbers to permit
    the central government to extend its authority throughout the
    country and to deal with an increasing opium poppy production
    problem.
        The Iraqi Governing Council (IGC) has adopted a
    constitutional document, albeit a transitional one, and Iraq is
    scheduled to regain its sovereignty on July 1 and, with U.N.
    help, will hopefully be holding national elections by the end
    of this year. The problems in Iraq are numerous. Security, as
    Tuesday's obscene bombings demonstrated, is a major problem, as
    former regime loyalists and jihadists are seeking to bring
    about civil war. The makeup of a transitional government
    remains to be decided and the status of coalition forces after
    July 1 is still up in the air.
        The issue of whom sovereignty is to be transferred to is
    not just a thorny intellectual issue. If the people of Iraq do
    not support their sovereign government, even greater chaos
    could result, up to and including civil war.
        Perhaps the only certainty and constancy in both of these
    countries is the bravery, dedication, and selflessness of the
    American troops, both active and Reserve. Another certainty is
    the resolve of this committee and our colleagues in Congress to
    ensure that our service men and women have the equipment,
    training, and support that they deserve. They already have
    superb leadership, as is so ably represented by General Abizaid
    and General Jones, and I look forward to the testimony of these
    two wonderful men.
        Chairman Warner. Thank you very much, Senator Levin.
        We will now proceed to receive the testimony from our
    witnesses, and we will lead off with General Abizaid.

    STATEMENT OF GEN JOHN P. ABIZAID, USA, COMMANDER, UNITED STATES
                            CENTRAL COMMAND

        General Abizaid. Mr. Chairman, Senator Levin, members of
    the committee: Thank you very much. As always, it is an honor
    to appear before the committee.
        I would like to start out first of all by thanking the
    committee for its tremendous support of our troops in the
    field. The single most important thing to our fighting men and
    women is knowing that they have the support of people back
    home, and that starts right here in the Congress of the United
    States, and we thank you for that.
        Chairman Warner. We will admit to the record your entire
    statement, as well as that of General Jones, so you can proceed
    to deliver those portions that you feel are relevant to the
    opening comments.
        General Abizaid. Thank you, Mr. Chairman.
        On the land, sea, and air today over the CENTCOM AOR are
    over 240,000 American servicemembers, and they are doing
    tremendous work out there. They have three primary missions:
    fighting the broader global war on terror throughout the area
    of operations; achieving stability in Afghanistan; and
    achieving stability in Iraq.
        In order to do this, we deploy three key headquarters, as
    the committee is well aware, the largest of which is Combined
    Joint Task Force 7 (CJTF-7), which operates out of Baghdad in
    Iraq. In Afghanistan, Combined Forces Command (CFC-A) is in
    Kabul under General Barno; and the smaller but very important
    headquarters in the Horn of Africa (CJTF-HOA) with about 1,100
    troops, does a good job in helping regional nations help
    themselves.
        All of us know that 2004 will be a key year for stability
    operations in Iraq and Afghanistan, and I am optimistic that we
    can move ahead in a way that will achieve greater stability and
    assure the prospect of representational government forming in
    both countries.
        Elections in Afghanistan and the transition of the
    sovereign authority in Iraq, with elections to come either this
    year or in the early part of next year, give us an opportunity
    to move ahead in very important ways in both locations.
        Key military tasks that we are completing in both locations
    include counterinsurgency operations, counterterrorist
    operations, stability operations, and certainly civil affairs
    operations, where we help in the local reconstruction of the
    infrastructure in both countries. Perhaps the most important
    activity that we will be involved with in both countries has to
    do with building Iraqi and Afghan security capacity. We have
    gone from zero members of Iraqi security forces back in May to
    around 200,000 today. In Afghanistan we have likewise built
    national security forces in an important way that will help the
    government eventually spread its control throughout the entire
    country.
        It is important to note, however, that it is not merely
    numbers that are important in building the security capacities
    of these Armed Forces, police forces, border forces, and other
    security institutions; it is also quality. Quality takes time
    to build. We will work very hard and diligently to increase
    their capacity over time.
        We extend our condolences to the more than 180 Iraqis that
    were killed and 500 that were wounded in yesterday's terrible
    attacks in Karbala and Baghdad. These attacks certainly
    represent the worst of the terrorist threat that exists in the
    CENTCOM AOR. There is no doubt that Zarqawi and his network, in
    conjunction with former regime elements, perpetrated these
    attacks. We know that there were at least six suicide bombers
    that were involved and we know that the number of killed and
    injured include innocent men, women, and children that were
    trying to celebrate the Ashura holiday.
        We know that duty in Iraq and Afghanistan is dangerous and
    will remain so. We know that there are more sacrifices ahead
    for our troops, but we also know that, in conjunction with
    Afghanis and with Iraqis and with the strong will and
    determination of our own forces, we will prevail there, and
    prevailing there means the establishment of moderate
    governments in both Iraq and Afghanistan firmly in control of
    their own people.
        Throughout the area of operations, it is indeed a battle of
    extremism versus moderation. It is a tough battle, but one that
    can be won in conjunction with the people of the region who,
    like the United States of America, value the opportunity for
    moderation to emerge. In every one of CENTCOM's 25 countries,
    there are more people against the extremists than are with
    them.
        In closing, Mr. Chairman, I would like to once again say
    that the most important people in CENTCOM's area of operations
    are our young men and women on patrol in the middle of the
    night in very dangerous circumstances. We appreciate your
    support. We appreciate the fact that the American people are
    supporting these young men and women as they do the important
    work ahead.
        Thank you, sir.
        [The prepared statement of General Abizaid follows:]
                 Prepared Statement by GEN John P. Abizaid, USA
        Mr. Chairman, members of the committee: I am honored to appear
    before you today and report on the state of the United States Central
    Command (CENTCOM), the situation and our actions in our area of
    responsibility (AOR), and discuss ways we can continue to increase our
    effectiveness. The command remains engaged on three principal fronts:
    the disruption of transnational terrorist networks working within and
    from our AOR, and countering insurgencies in both Iraq and Afghanistan.
    These activities are interconnected. CENTCOM operates within the
    geographical and ideological heart of the global war on terror. Success
    in Afghanistan and Iraq will result in stable states that do not harbor
    terrorists and provide a visible alternative to the terrorists' vision
    of chaos and conflict.
        Over 200,000 soldiers, sailors, airmen, marines, coast guardsmen
    and Department of Defense (DOD) civilians, alongside over 30,000 of our
    coalition partners, are serving today in CENTCOM. The total force is
    represented by over 47,000 Guard and Reserve troops that are completely
    integrated into the effort. The coalition is engaged in a wide range of
    activities that contribute to the stability of the region and the
    security of our Nation. These include counterinsurgency,
    counterterrorist, stability, civil affairs, reconstruction, and theater
    security cooperation activities. Over 870 aircraft and 30 ships are
    sustaining and supporting our land forces, simultaneously deterring our
    adversaries and gathering vital intelligence, while Marine forces
    embarked in Expeditionary Strike Groups serve as the region's strategic
    reserve. Every day our service men and women are operating alongside
    our coalition partners with courage, dedication, and professionalism.
        Our operating environment is always dangerous, and we both
    appreciate and honor the sacrifices made by our soldiers, sailors,
    airmen, marines, and their families over the past 28 months. We have
    had many successes, but there is much yet to be done. Our enemies
    continue to seek to inflict casualties upon those who oppose them in an
    attempt to hinder our progress and break our will. Our commanders in
    the field recognize these risks, adapt to their tactics, techniques,
    and procedures and aggressively take the fight to the enemy. I thank
    you all on their behalf for the tremendous support we have received
    from Congress. We must stay the course, which will require continued
    sacrifice both at home and abroad.
        The demands associated with our combat missions have resulted in a
    force that possesses unprecedented operational and tactical savvy. Our
    leaders have developed an extremely high degree of professionalism in
    the conduct of one of the toughest missions any military faces. We are
    waging a counterinsurgency against an enemy hiding within the
    population and operating without rules. Our troops are proving every
    day that they are adaptive, imaginative, professional, competent, and
    most of all courageous. I visit our troops and commanders frequently
    and they are confident we are winning the war on terror, winning the
    peace in Afghanistan and Iraq, and contributing to stability in
    volatile regions such as the Horn of Africa. They are also realistic,
    however, and understand that success will not come overnight or without
    further sacrifice. The young troops are setting a modern standard for
    the ``Greatest Generation.''
                                    mission
        CENTCOM conducts joint and combined operations in the AOR to defeat
    our adversaries, promote regional stability, support our allies and
    friends, and protect our interests.
                                     vision
        As a Unified Command, CENTCOM may operate as a Combined Command,
    synchronizing joint and combined forces to decisively defeat enemies
    within the assigned AOR. CENTCOM promotes regional stability through a
    robust program of military cooperation, exercises, and frequent
    contact. We support our allies' and friends' efforts to build and
    sustain the individual and collective defense capabilities required to
    allow them to prosper free from terrorism, war, or oppression. American
    and coalition presence will deter adversaries through demonstrated
    resolve to protect our national interest.
                               nature of the aor
        The CENTCOM AOR spans 6.4 million square miles including Egypt, the
    Horn of Africa, the Arabian Peninsula, Pakistan in South Asia, and the
    Central Asian states as far north as Kazakhstan. It is intersected by
    critical transportation and trade routes and includes the waters of the
    Red Sea, the Northern Indian Ocean, the Arabian Gulf, and the key
    maritime choke points of the Suez Canal, the Bab el Mandeb, and the
    Strait of Hormuz. The Arabian Gulf region alone accounts for two-thirds
    of the world's crude oil reserves, 25 percent of the world's oil
    production, and 36 percent of the world's natural gas reserves. The
    region is home to more than 500 million people including at least 18
    major ethnic groups and adherents of all the world's major religions.
        Economic, social, and political conditions vary greatly from one
    nation to another. However, despite the riches of its natural resources
    and human potential the region faces significant security challenges
    ranging from international terrorism to state-to-state conflict. Some
    regional governments are hard pressed to satisfy growing populations'
    demands for a better quality of life. A tide of social and economic
    discontent makes many populations vulnerable to extremist ideology and
    anti-American sentiment.
        Extremist organizations prey on disenfranchised youth and those
    without hope. They attempt to indoctrinate the youth to violent Jihad
    as the principal means of advancing their cause. States in our AOR most
    vulnerable to extremism include Iraq, Afghanistan, Pakistan, Saudi
    Arabia, and Yemen although no nation in our region is free from this
    risk. In addition, we keep a keen eye on flashpoints between Pakistan
    and India, Eritrea and Ethiopia, and civil war in Sudan.
        We operate in a region that has a low tolerance for a major foreign
    military presence--no matter how well-intentioned. Our longer term
    presence in the region must therefore be tailored to be effective but
    not overbearing. Our vision in this region must be to help nations help
    themselves. As Iraq and Afghanistan move towards stability, we must
    integrate them into our long term strategy for peace and look for ways
    to include them in the group of nations fighting terrorism and
    extremism locally, regionally, and globally. Ultimately, our
    partnerships throughout the region aim to foster strong and stable
    states fully capable of helping themselves and regional communities of
    nations willing and able to help each other.
                              global war on terror
        The CENTCOM region lies at the geographic and ideological heart of
    the global war on terror. Partnered as we are with many Islamic
    nations, we recognize that the war on terror is not a war against
    Islam. We are cognizant of an ongoing struggle within our region
    between extremism and moderation. Al Qaeda is attempting to exploit and
    amplify regional tensions to the point they can cause global effects.
    Their strategy is to create footholds of sympathy and support within
    populations from which to attack supporters of moderation and
    tolerance. They seek to drive the U.S. from the region and then
    champion an insurrection against moderation. Their strategic timeline
    is measured in decades and generations.
        Pursuit of this enemy is our highest priority and we know that
    while the military can and will continue to disrupt and defeat al Qaeda
    on the battlefield, the root causes of terrorism have inherently non-
    military solutions. It is important to isolate the al Qaeda network and
    other transnational terrorist organizations from their sources of
    ideological, financial, and material strength. We have put significant
    pressure on the al Qaeda terrorist network throughout the region.
    Together with our coalition, interagency, and host nation partners, we
    have killed and captured terrorists, attacked their infrastructure,
    restricted their movement, disrupted their financial support, and
    depleted their leadership. We have gained experience and perspective on
    the nature of the threat and their tactics. We are using that
    experience to become even more effective, especially in the area of
    intelligence and counterinsurgency.
        Close cooperation with our interagency and international partners
    is an important element of success. Only by fully synchronizing our
    military efforts with those focused on diplomacy, intelligence
    collection and analysis, economic development, law enforcement, and
    strategic communications will we put pressure on the threat while at
    the same time win the confidence of the moderates. We continue to
    develop interagency ties at all levels of command to facilitate cross
    agency information and activity. Our Joint Interagency Coordination
    Group (JIACG) within the headquarters is an example of this new wave of
    integration. So too are we synchronizing coalition activity for the
    global war on terror. Sixty-five countries have military
    representatives at the CENTCOM headquarters in Tampa sharing
    information and integrating plans. Because the enemy is borderless and
    his strategy is broad, we cannot afford to permit gaps in our effort
    that terrorists can exploit. The solidarity and collective will of the
    coalition is our strength against an enemy that preys on weakness.
        Regardless, the terrorist enemy is agile, patient, and deadly. They
    have adapted their methods to counter our successes. In recent months,
    the suicide bombings that killed or wounded thousands of innocent
    Muslims in Turkey, Saudi Arabia, Iraq, and Afghanistan demonstrate that
    terrorists' claims that they are solely at war with America are false.
    Al Qaeda organizers, operatives, and other cadres have dispersed,
    establishing clandestine bases of operation in inaccessible to the
    United States and its allies or ungoverned spaces. The enemy's
    ideological base, financial networks and information networks remain
    partially intact and functional. The demographic and economic
    conditions that breed terrorists continue to concern us.
        We remain concerned that modern technology could give terrorists
    access to destructive power, which, in the past, has been limited to
    nation states. Indeed, we know that terrorist organizations have been
    pursuing weapons of mass destruction (WMD). Effective offensive
    operations against al Qaeda and its associated organizations prevent
    these terrorists from establishing deliberate programs to make these
    destructive weapons. Measures to effectively control borders and detect
    proliferation of WMD-related materials and technology need to be
    strengthened within regional nation states.
        Success in this war depends greatly upon collective action and
    international cooperation. While U.S. and coalition forces will remain
    on the offensive, indigenous forces are best suited to develop human
    intelligence and act on that intelligence to defeat the enemy. Our
    headquarters, Combined Forces Command Afghanistan (CFC-A), Combined
    Joint Task Force-7 (CJTF-7) in Iraq, and CJTF Horn of Africa (CJTF-HOA)
    headquartered in Djibouti, along with our component commands, conduct
    theater security cooperation with other nations to help build
    indigenous counterterrorism capabilities. U.S. Naval Forces CENTCOM
    (NAVCENT) directs seventeen countries in a sustained effort to curtail
    trafficking of terrorists, as well as narcotics and other prohibited
    items. Carrier battle groups and strike groups are apportioned to
    support CENTCOM operations using the Global Naval Force Presence Policy
    (GNFPP).
        While we must remain alert to the danger that transnational
    terrorism poses, we must also recognize the terrorists' vulnerabilities
    and the opportunities they present. The war against terrorism is a war
    largely of intelligence and perceptions. While we are constantly
    improving our intelligence picture of the enemy, we must also become
    more adept at public diplomacy and strategic communications. The
    terrorist vision is not inherently appealing given its foundation of
    intolerance, restricted freedoms and forced compliance. Moderates will
    only move in the extremist direction if they see it as the only way to
    achieve sustenance, personal security and a sense of community. It is
    important to make every effort to help the host nations improve
    essential services, enhance security and provide venues for political
    participation. It is also important to tailor and temper our combat
    activities to cultural sensitivities and personal security concerns of
    the moderates as we pursue the terrorists.
                                      iraq
        There are currently over 184,000 coalition personnel supporting
    Operation Iraqi Freedom (OIF) in Iraq and Kuwait. Over 114,000 U.S.
    personnel and over 23,000 coalition personnel from 35 nations are
    currently fighting to achieve security and stability in Iraq. The force
    is commanded and controlled by CJTF-7, centrally located in Baghdad,
    and is composed of five divisions; three U.S. Army divisions, two
    multinational divisions, and one multinational brigade. Special
    Operations Forces (SOF) under Special Operations Command CENTCOM
    (SOCCENT) leadership work in close collaboration with CJTF-7 and
    coalition partners throughout Iraq to enhance information sharing and
    planning efforts.
        Multinational forces are currently responsible for northern and
    southern portions of Iraq while U.S. Army units are deployed in
    Baghdad, central, northern, and western Iraq. Over 26,000 U.S. and
    coalition personnel are deployed in Kuwait, providing logistical
    support to OIF. Today, we are engaged in a major force rotation that
    will be complete by early May. While force numbers will remain
    relatively stable, incoming forces will be task organized with more
    infantry and greater mobility to fight the counterinsurgency. We have
    reduced our numbers in those sectors where the security environment
    permits, and increased our presence in others. For example, in the
    north where enemy activity has been low, an Army Stryker Brigade has
    replaced elements of the larger 101st Air Assault Division. In the west
    where enemy activity is high, the Marines will bring in a larger Marine
    Expeditionary Force (MEF) to replace the 82nd Airborne Division. In all
    cases, the replacement forces are tailored for the mission, trained in
    the tactics, techniques and procedures developed by the departing unit,
    and spend time in their sector with the outgoing unit before its
    departure.
        The three major elements fighting coalition forces in Iraq are
    Former Regime Elements (FREs), transnational terrorists, and religious
    extremists or jihadists. The FREs seek to expel the coalition and
    return themselves to power. They are waging a tactical campaign against
    coalition forces and attempting to intimidate the Iraqi police and
    Iraqi Civil Defense Corps (ICDC) security forces while terrorizing both
    Iraqi citizens and anyone cooperating with coalition forces. These FREs
    operate primarily in north-central and western Iraq, the traditional
    strongholds of the Baathist regime. FREs predominately use standoff
    weapons such as rockets, mortars and small surface-to-air missiles to
    engage coalition forces. Since last summer they have become extremely
    adept and adaptive with improvised explosive devices (IEDs) to the
    point that the majority of American casualties are now caused by IEDs.
        CENTCOM is working with the Services and numerous DOD agencies,
    civilian research laboratories, and private businesses to develop and
    deploy technologies to defeat and mitigate the effects of the IEDs. We
    are focused on those technologies that can deny bombmakers access to
    materials to make IEDs, provide persistent surveillance to our likely
    routes of travel, allow us to detect the presence of IEDs well outside
    the IED blast zone, neutralize or defeat those IEDs that remain hidden
    from us, and as a last resort, protect our troops from the effects of
    an IED blast.
        Transnational terrorists such as the Zarqawi network, Ansar al
    Islam, and al Qaeda are attempting to destabilize Iraq by increasing
    both ethnic and sectarian strife with the intention of inciting chaos
    and a civil war. Their intent is to drive international institutions
    such as the United Nations (U.N.) and Red Cross from Iraq. Ultimately
    they desire to create a new extremist base of operations following
    their losses in Afghanistan. These terrorists are operating in the same
    areas as the FREs, which are largely former Baathist strongholds. They
    also have a presence in northern Iraq and are launching attacks into
    southern Iraq targeting the Shi'a population, the international
    community, and security forces. While many of their tactics are similar
    to those employed by the FREs, they are more likely to employ suicide
    attacks, including car bombs.
        The third group is religious extremists or jihadists. This group is
    widely diverse and made up of foreign fighters, adventurists who have
    responded to the extremists' false call for Jihad, and dissatisfied
    Iraqi Sunni Arabs. They are committed to driving westerners from the
    Middle East, deposing the current regional regimes and establishing an
    Islamic state or greater Caliphate. Some foreign fighters come to Iraq
    completely untrained with little money and no contacts, while others
    are veterans of previous jihad campaigns having spent years operating
    within Mujihadin networks.
        Our response to the enemy in Iraq is framed in terms of
    counterinsurgency principles. We are developing a clear picture of the
    enemy through the combined efforts of our conventional forces, SOF, and
    the Intelligence Community. The cornerstone of our counterinsurgency
    operations is human intelligence (HUMINT) collected through a multitude
    of initiatives. Our conventional units cultivate personal relationships
    with civic leaders and the local populace on patrol and during
    humanitarian assistance, medical, dental, veterinarian, and
    reconstruction initiatives that provide important opportunities for
    gaining insight about local conditions.
        SOF and other government agencies are developing intelligence
    through a growing number of sources supportive of a new Iraq. Analysis
    at every echelon of command is fused together to create an
    understanding of the terrorist networks in Iraq. These efforts have
    resulted in more than 140 raids a week. Simultaneously, we are working
    to isolate the enemy from their sources of strength and leadership
    within the country. By doing so, we intend to separate them from their
    popular support base and deny them funding, arms, and freedom of
    movement. Improved security, in conjunction with an improving economic
    and political environment will dry up their recruiting base.
        The Iraqi Survey Group (ISG) has been a contributor to our
    counterinsurgency efforts. Although their primary mission has been to
    unravel the former Iraqi regime's involvement and production of WMD,
    the nationwide network of case officers and sources have developed
    timely reporting of threats against coalition forces. As their
    investigators, analysts, and interpreters sifted through hundreds of
    thousands of documents, and made relevant documents to CENTCOM analysts
    to build databases of former Iraqi military organizations and
    intelligence services. Thousands of names, addresses, and pictures now
    populate these databases, enabling coalition forces to understand,
    target, and raid cells of the Special Republican Guards and the Iraqi
    Intelligence Service.
        We continue to focus our efforts in specific areas: improving
    intelligence fusion and analysis; developing Iraqi security forces;
    internationalizing our security effort; protecting the infrastructure
    and aiding reconstruction; and helping to communicate our intentions,
    plans, and successes to the Iraqi people.
        Improvements in our intelligence system are paying off and we
    continue to enhance our ability to collect, analyze, and disseminate
    intelligence in a timely manner. Upgrades in automation networks, data
    basing capabilities, and bandwidth have given coalition forces the
    ability to strike quickly against enemy forces. Our intelligence
    picture will improve further as nascent Iraqi security and intelligence
    capabilities mature. We are also establishing mechanisms to ensure that
    Iraqi forces have adequate intelligence capabilities as they assume
    more responsibility.
        One of the fundamental elements of successful counterinsurgency
    operations is building an effective indigenous security force.
    Coalition forces are supporting the development of Iraqi police, border
    police, ICDC, and Iraqi Armed Forces. In May 2003 there were no Iraqi
    security forces; there are now over 200,000. Our forces are recruiting,
    training, and conducting joint operations with the ICDC. We are
    imbedding our SOF inside the ICDC battalion to train and mentor these
    units as they gain both proficiency and confidence.
        The Coalition Military Advisory Training Team (CMATT) is
    recruiting, equipping, and training the Iraqi Armed Forces. We have
    fielded three battalions of the Iraqi Armed Forces and one more is in
    training, and within a year there will be three divisions of the
    National Iraqi Army (NIA). We are also expanding Iraqi maritime
    capabilities, assisting the maritime components of the NIA, the Iraqi
    Coastal Defense Force, and the Iraqi Riverine Patrol service to ensure
    they possess the capability to control Iraq's territorial and internal
    waters. We must ensure these forces are well led, well trained, well
    equipped, and are subordinated to legitimate civil authority.
        We are coordinating with the Coalition Provisional Authority (CPA)
    to accelerate the formation of the Iraqi Police Services, the
    Department of Border Enforcement, and the Facilities Protection
    Services. These forces are essential in establishing Iraqi rule of law
    prior to transitioning to a sovereign Iraqi government. The arrival of
    civilian police advisors will greatly improve our efforts to increase
    the number and effectiveness of security force personnel.
        As Iraqi forces become capable of autonomous operations, we will
    continue to reduce coalition military presence in dense urban areas and
    position forces in order to provide quick reaction and facilitate
    effective joint patrol operations with Iraqi security forces. In many
    parts of northern and southern Iraq, Iraqi security forces have already
    taken responsibility for day-to-day security operations, asserting
    control over their own neighborhoods.
        We are dedicated to a true partnership with the Iraqi security
    forces during this critical period in the battle. Knowing that Iraqi
    forces and leaders will take time to mature and they will be likely
    targets for the enemy, we are integrating training and liaison teams
    into their formations. The ICDC in particular is becoming more
    confident as our joint patrols and raids demonstrate the effectiveness
    of new equipment and tactics. ICDC units are taking the lead during
    more operations and gaining respect from the Iraqi people and enemy. We
    are also developing Joint Coordination Centers (JCCs) to better
    coordinate the efforts of the local police, the ICDC and the coalition.
    Over time, we will support the development of the Iraqi Defense and
    Interior Ministries and their staffs while building a Joint Force
    Headquarters. Iraqi officers will be integrated into the command
    structure of the multi-national force that will provide stability
    following the transition to Iraqi sovereignty. It is important to
    remember that this strategy will not only depend on our actions, but on
    enemy reactions and initiatives that are often difficult to predict
    with any degree of certainty.
        This is also an international effort; over 23,000 coalition troops
    from 35 nations have joined our forces in Iraq. These forces control
    two large sectors in southern Iraq. Poland leads a 24 nation effort in
    Multi-National Division Center-South, and the United Kingdom leads an
    11 nation effort in the south east. These nations have been subject to
    attack and we are truly grateful for their continued contribution and
    sacrifice. Financial support for many of these nations has been
    critical to their participation.
        Additionally, we also have international support for developing
    Iraqi security forces. We are grateful for the assistance of those
    nations training Iraqi police, including Jordan, the United Arab
    Emirates (UAE), and the Federal Republic of Germany. We are committed
    to broadening the international effort and welcome the assistance of
    other nations and international organizations.
        Security and reconstruction are interdependent. Unemployment and
    the lack of basic services is causing disaffection among the population
    which helps to provide fertile ground and an available recruiting pool
    for those who seek to incite attacks against other Iraqis, the
    infrastructure and coalition forces.
        Our coalition troops have contributed to reconstruction and
    building a foundation for Iraqi prosperity. The Commander's Emergency
    Response Program (CERP) continues to be very effective in facilitating
    the reconstruction effort and also provides commanders with an
    effective means to fight the insurgency. Coalition forces have
    completed over 13,000 construction projects including schools,
    hospitals, businesses, transportation networks, wells, water treatment
    plants, and irrigation systems. The U.S. Army Corps of Engineers
    recently established a Gulf Region Division in Baghdad to further
    accelerate our progress in restoring Iraqi infrastructure and the
    important oil and electricity sectors.
        U.S. and coalition military commanders are working with local
    townspeople to prioritize small reconstruction projects, thousands of
    which are already completed and benefiting the local populace.
    Coalition and Iraqi forces will continue to secure the infrastructure
    and expedite reconstruction. Opening the major airports in Iraq to
    commercial aviation will be an important step in returning to normalcy
    and bolstering economic activity.
        As we transfer responsibilities to the Iraqis, it is important to
    continue to assist the CPA's efforts to communicate effectively with
    the Iraqi people and others in the region to clarify our intentions,
    expose the brutality and hypocrisy of the enemy, publicize Iraq's
    successes, and generate hope. The establishment of media platforms,
    such as the Iraqi Media Network in Iraq and Al Hurra in the region are
    particularly promising because they provide alternatives to the often
    hostile regional media. We will continue to tell the story of our
    successes as well as report our setbacks.
        We will continue to work closely with the U.S. diplomatic presence
    as we approach the transfer of authority (TOA) in Iraq. A new military
    headquarters in Iraq will focus on coordinating the counterinsurgency
    campaign, effecting close civil-military coordination, building Iraqi
    security capability, assisting with reconstruction efforts, and
    mentoring the nascent Iraqi joint force headquarters and Armed Forces.
        CENTCOM expects that violence will increase as Iraq moves to
    sovereignty. Mus'ab al-Zarqawi explains in his letter to Osama bin
    Laden that he thinks ``zero hour must be at least 4 months before the
    new government gets into place. We are racing time.'' It is clear
    Zarqawi and others see this milestone as a major danger and intend to
    surge against it. The enemy fears a network of credible security forces
    deployed against them and has stepped up their targeting of police
    stations, recruiting centers, and key security leaders. The enemy will
    certainly target critical infrastructure in its bid to undermine Iraqi
    legitimacy. Some of our adversaries will attempt to exacerbate ethnic
    tensions with the intent of sparking civil war by attacking important
    ethnic and religious leaders with a goal of causing mass casualties and
    media events to highlight their carnage.
        The political process is moving with increased participation by
    Iraqis and the international community. The security forces continue to
    build at a brisk pace with no drop off in recruiting following recent
    terrorist attacks. Essential services are improving and in most cases
    exceed pre-war levels. Ethnic violence has been limited with major
    groups participating in the political process. While there is a
    possibility that civil war could break out, we currently believe the
    probability of such a conflict is low. We believe there are many more
    people working to keep Iraq together than to break it apart.
        As those of you who have visited Iraq know, the performance of our
    coalition service men and women is outstanding. They are accomplishing
    complex tasks under difficult and dangerous conditions. We now face a
    transitional period in Iraq as we prepare to transfer sovereignty to
    the Iraqi people. Key actions include defeating the insurgency,
    restructuring command and control to facilitate reconstruction and
    stabilization; building Iraqi security institutions; and completing one
    of the largest rotation of forces in recent times. While we remain
    optimistic about the road ahead, we cannot predict future force sizing
    and composition until the political situation concerning Iraqi
    sovereignty clarifies itself.
                                  afghanistan
        We currently have close to 13,800 coalition personnel deployed in
    Afghanistan as part of Operation Enduring Freedom (OEF). These forces,
    that include nearly 12,000 U.S. personnel and 1,800 coalition personnel
    from 18 nations, are commanded and controlled by the CFC-A. Every
    branch of the U.S. armed services is represented in this command.
    National Guard and Reserve components make up approximately 26 percent
    of our forces deployed there. Part of the CFC-A mission is to assure
    unity of effort with the U.S. Ambassador and country team in Kabul and
    manage the military-to-military relationship with the Governments of
    Afghanistan, Pakistan, and the International Security Assistance Force
    (ISAF).
        CJTF-180 is a division level organization that exercises command
    over 11 separate task forces; including 2 coalition battalions and
    other support, medical, engineering, and training units. It also has
    special operations capabilities assigned from U.S. and coalition
    nations.
        The threat situation in Afghanistan remains relatively stable,
    although al Qaeda and Taliban elements continue to target President
    Karzai's government, Afghan Militia Forces (AMF), coalition forces,
    ISAF, and international organizations. This threat is composed of three
    groups. In the northeast and the Kabul regions, al Qaeda affiliated
    groups such as Hizb i Islami Gulbuddin (HIG) led by Gulbuddin Hekmatyar
    pose a continued threat. In the southeast, tribal elements and al Qaeda
    continue their resistance to Afghan and coalition forces. In the south,
    remnants of the Taliban and al Qaeda continue to operate out of the old
    Taliban strongholds in the Qandahar area. These groups make effective
    use of propaganda, maintaining just enough support to continue
    operating in Afghanistan. The enemy uses hit and run tactics,
    inflicting casualties with small arms, grenades, IEDs, rockets, and
    suicide attacks.
        We continue to share lessons learned between operations in
    Afghanistan and Iraq and apply counterinsurgency principles found
    effective in Iraq against al Qaeda and Taliban in Afghanistan. Once
    again we find the key to counterterrorism operations is the development
    of actionable intelligence and tying it to a flexible lethal response.
    In Afghanistan we are in the process of building similar HUMINT
    networks and communications architectures that have proved effective in
    Iraq. The construction of a Joint World Wide Intelligence
    Communications System (JWICS) network and a voice over internet
    protocol (VOIP) phone system will improve targeting capabilities. In
    many cases, intelligence is enabled by successful civilian and military
    operations that convince the local populations that the Karzai
    government and the coalition provide the best opportunity for a
    prosperous future. The key is visible reconstruction progress which
    gives people a hope for a better future. These critical shaping
    operations set the conditions to isolate our enemies from their base of
    support.
        While our military operations over the past year have inflicted
    losses on al Qaeda and anti-coalition opposition forces, attacks such
    as the recent suicide bombings in Kabul remind us that our enemy is
    resilient and determined to disrupt upcoming elections as well as
    reconstruction efforts. Coalition and Afghan forces will continue to
    target and attack remaining pockets of al Qaeda and Afghan opposition
    fighters to remove them as a threat and promote stability throughout
    the country. Pakistan's cooperation has contributed to our success in
    this regard and our continued support to them will further improve
    their ability to disrupt the enemy's efforts to reorganize and conduct
    operations.
        CFC-A continues to integrate U.S. and coalition conventional, SOF,
    Air Forces, Afghan National Army (ANA), and AMF into effective
    operations throughout the country. This year, the North Atlantic Treaty
    Organization (NATO) took an important role in Afghanistan by providing
    command and control for ISAF. The 6,300 troops of the NATO-led ISAF are
    vital to establishing security in Kabul. NATO has recently taken charge
    of the Konduz Provincial Reconstruction Team (PRT) and four adjacent
    provinces in the northeast. NATO is also preparing to further expand
    its reach across the north.
        Coalition forces continue working closely with our Afghan allies
    and ISAF to maintain stability and strengthen the writ of the Kabul
    Government. The ANA, whose units continue to develop professionalism
    and gain operational experience, will support these efforts. Where
    deployed, the ANA has earned the trust and confidence of Afghan
    citizens. The growth of the ANA, along with the disarmament,
    demobilization, and reintegration (DDR) of Afghan militias and the
    establishment of police forces, will ensure viable security sector
    reform.
        There are approximately 8,900 ANA soldiers currently enlisted. The
    last battalion of the Central Corps is in training now and should
    complete training in mid-March, establishing three five-battalion
    brigades within the Central Corps. While fielded forces are the
    mainstay of any defense establishment, the headquarters and support
    organizations to organize, train, equip, and employ those forces must
    also be established.
        A key to long-term Afghan security self-sufficiency is to reform
    the Ministry of Defense and the Afghan General Staff from a Soviet-
    style bureaucracy to a modern professional armed force. By linking the
    Ministry of Defense and General Staff structure to that of the regional
    commands, we will have the framework required to expand the reach of
    the central government throughout the country. This is an important
    element of our strategy to bring political reform to the regions
    outside Kabul that remain dominated by warlords.
        Reconstruction remains vital to isolating our enemies and depriving
    them of their support base. Both NATO nations and nations in the OEF
    coalition are sponsoring PRTs. The purpose of the PRTs is to create
    enclaves where representatives from the Afghan Government, the
    international community, and aid organizations can bring capability to
    the outlying regions. An extremely successful program, the number of
    PRTs recently jumped from 8 to 12 with 4 more planned by summer.
    Additionally, 29 nations are providing reconstruction support through
    financial and humanitarian assistance efforts. CENTCOM welcomes and
    will facilitate NATO's offer to expand its role in security and
    reconstruction. While NATO's focus is on manning PRTs and stabilizing
    large portions of the country, the U.S.-led OEF coalition conducts
    operations to assist the Afghan authorities in building a safe and
    secure environment to support reconstruction while continuing, as
    necessary, combat operations to defeat al Qaeda, the Taliban, and other
    anti-coalition forces in Afghanistan.
        With the recent success of the Constitutional Loya Jirga, the Bonn
    process continues towards elections later this summer. We are preparing
    however, for a likely increase in violence during the final phase of
    this process as al Qaeda and Taliban work to prevent further gains by
    the legitimate government. There is evidence that the threat will step
    up attacks on key leadership, the Afghan Security Sector and
    interagency civilians supporting the mission. We are currently focusing
    our intelligence on these threats and are fully prepared to preempt,
    prevent or respond to these events as we can. We expect force levels to
    remain relatively stable in the months ahead.
    Horn of Africa
        CENTCOM has steadily increased operational focus in the Horn of
    Africa and the surrounding maritime environment to identify the methods
    and means employed by international terrorist organizations and
    networks. There are currently over 1,200 coalition personnel deployed
    in the Horn of Africa. Our operations there are commanded and
    controlled by CJTF-HOA, which is located in Djibouti and supported at
    sea by Commander Task Force 150 (CTF-150), a Royal Navy Flag officer
    with 7 ships from 6 countries. The current emphasis of forces in this
    area is intelligence collection, developing interagency and
    international structures, conducting civil-military operations, and
    helping nations in the region build collective security structures.
    SOCCENT assets also provide important help in increasing regional
    counterterrorist capabilities.
        The Horn of Africa sits astride the southern portion of one of the
    major sea-lines of communication that CENTCOM must use to operate in
    the Arabian Gulf region. Threats to the stability of the region
    include: internal conflicts, border disputes, extreme poverty, and
    transnational terrorists. The consequences of war are easily magnified
    in this region because well over 17 million people are at risk of
    starvation. People are being forced to leave their homes due to
    violence, the search for food, medical care, and safety. Many sub-
    Saharan African states have limited or unreliable internal security
    capabilities and this weakness makes them attractive venues for
    terrorist cells and criminal organizations. Terrorist organizations
    seek to exploit the Horn's ungoverned areas to train recruits as well
    as plan and conduct operations against U.S. interests and those of our
    allies.
        Nonetheless, we have partners in the region who are willing to
    fully cooperate in pursuit of a common goal. Djibouti has given
    extraordinary support for U.S. military basing, training, and
    counterterrorism operations, including combined maritime interdiction
    of several terrorist associated dhows. Kenya, a leader in East African
    regional affairs, has also been a key ally in the war on terror and has
    been instrumental in promoting and facilitating peace in Sudan and
    access to Somalia. Ethiopia, despite its very limited resources, is
    undertaking an ambitious program of security sector reform and is also
    committed to combating terrorism and countering extremism within its
    borders.
        As a result of many of the challenging conditions prevailing in the
    Horn of Africa, our Theater Security Cooperation programs emphasize
    humanitarian assistance and civil-military operations. Additionally,
    there is an overarching emphasis on the development of regional
    security structures. CJTF-HOA's regional security arrangements and
    preventive humanitarian operations greatly enhance the ability of
    regional nations to improve their security posture.
        Instability in the Horn is a long-term problem. Somalia is a failed
    state that transnational terrorists use as a transit point and safe
    haven. Sudan has suffered from continuous civil war for decades and
    remains a training and staging location for transnational terrorist
    organizations. Border tensions between Ethiopia and Eritrea remain high
    with renewed conflict a possibility. Increased funding to reinforce
    security sector reform and counterterrorism activities in Yemen,
    Djibouti, Ethiopia, Kenya, and cautious engagements with Eritrea and
    Sudan will help us build on progress we have made in the past year.
        In the Horn of Africa, our strategy aims to increase pressure on
    the terrorist networks established there, while at the same time,
    deterring migration of high-level al Qaeda who may seek sanctuary
    there. Central to this objective are coalition efforts to enhance the
    Nations' capability to detect and combat the terrorist threat.
    Bilateral agreements for intelligence exchanges and in-country
    intelligence officer training courses are valuable to both our African
    partners and us.
        CJTF-HOA serves as a tangible sign of U.S. commitment to
    governments in the Horn of Africa. They are developing cooperative
    security arrangements and mitigating the cross-border seams exploited
    by terrorists. CJTF-HOA also provides an organizational model for the
    way ahead in the global war on terror where our long-term objective is
    to help nations help themselves.
            theater security cooperation and other regional concerns
        CENTCOM's security cooperation program paved the way for the
    essential basing, staging, and overflight rights supporting OEF and OIF
    that augmented access to Diego Garcia granted by our staunchest ally,
    the United Kingdom. The command continues to work and train with other
    nations as a normal course of our operations. In planning cooperative
    activities, we do so with the view that we must build relationships
    that promote U.S. interests, build allied and friendly nations'
    military capabilities, and provide U.S. forces with access and enroute
    infrastructure.
        These ventures require expanded fiscal and political investment to
    keep them viable. The anticipated Fiscal Year 2004 Foreign Military
    Financing allocation of $2.15 billion will strengthen our relationships
    with Egypt, Jordan, and Pakistan, strengthen the ANA, and improve our
    cooperation with other nations in the central region. Continued
    investment in security assistance improves the capabilities of friendly
    nations, enables them to provide for their own security and allows them
    to provide meaningful contributions to coalition activities such as
    counterterrorism.
        International Military Education and Training (IMET) is a cost-
    effective investment that positively shapes the future security
    environment by exposing foreign military officers and officials to U.S.
    practices and operations. This program provides foreign military
    members the opportunity to attend courses at U.S. military institutions
    such as Command and Staff Colleges and Senior Service Schools. These
    students become familiar with congressionally mandated subjects such as
    U.S. concepts of military professionalism, respect for human rights,
    subordination to civilian authority, and U.S. democratic institutions
    and culture. A new DOD appropriation, the Counterterrorism Fellowship,
    allows us to offer relevant courses to officers from key partners in
    the global war on terror. The return on investment is large:
    international military officers who understand U.S. military values and
    institutions. The relationships built during fellowships advance
    international cooperation. Foreign Military Financing and IMET benefit
    the recipient as well as the United States. CENTCOM recommends
    continued funding for these effective programs. We should not
    underestimate the worth of our commitment to these programs; the
    command will continue them as a matter of highest priority.
        While our two most pressing priorities in the AOR are the efforts
    to bring stability to Iraq and Afghanistan, the greatest danger may be
    growing extremist influence in nations such as Pakistan and Saudi
    Arabia. Our Theater Security Cooperation program aims to support these
    nations' efforts to reinforce moderation and implement reforms designed
    to achieve long-term stability.
    Pakistan
        President Musharraf and Prime Minister Jamali are leading their
    country to resist extremism and we fully support their efforts to
    promote regional stability. Pakistan has played a key and essential
    role in both the global war on terror and OEF. Recent diplomatic
    initiatives between Pakistan and India concerning control of the
    Kashmir area are encouraging. The presence of the terrorist threat,
    regional instability and nuclear weapons makes Pakistan a country with
    which we need to remain heavily engaged.
        President Musharraf has made great strides in curtailing the
    influence of terrorists within his nation and the Pakistani Army has
    become more effective along the Afghan border. Pakistan faces unique
    challenges in the Federally Administered Tribal Areas (FATA) where many
    al Qaeda and Taliban leaders and forces settled following major combat
    operations in Afghanistan. President Musharraf has begun a long-term
    strategy to engage the tribal leaders in these areas. He is offering
    them access to government resources if they purge the terrorists from
    their area of control, but at the same time, he is prepared to take
    military action against those found non-compliant. We are supporting
    these efforts through increased intelligence sharing and security
    assistance while improving operational coordination between CFC-A and
    the Pakistani military. We also conduct regular meetings between
    Afghan, Pakistani, and U.S. military leaders to promote transparency
    and cooperation between governments along the border.
        Pakistan has been a steadfast partner of the U.S. since the start
    of OEF, providing a wide range of access, basing, and overflight
    support for operations in Afghanistan. In addition, Pakistan played an
    important and active role in the capture of al Qaeda leader Khalid
    Sheikh Mohammad. In return, we are conducting a full range of
    engagement activities with them to include military to military
    contacts, bilateral exercises, and training programs. Pakistani
    officers attend the command and staff and war colleges of all four
    armed services and in turn, a select number of our officers attend
    their institutions.
        The U.S. strategic relationship with Pakistan has been difficult
    over time, but a stable and moderate Pakistan capable and willing to
    fight terrorism is in the U.S.'s best interest. Ensuring a positive
    outcome in Pakistan requires us to stay engaged.
    Kingdom of Saudi Arabia
        Recent attacks in the Kingdom of Saudi Arabia have convinced Saudi
    leaders of the direct nature of the threats to the Royal Family and the
    government. Saudi Arabia is a major battleground in the global war on
    terror because of the presence of al Qaeda, their sympathizers and
    significant resources. Saudi Arabian security forces have vigorously
    pursued terrorists inside the kingdom, killing or capturing hundreds of
    al Qaeda. The Saudis have also made inroads against terrorist finances
    and infrastructure, but there is more to be done.
        Our engagement activities in Saudi Arabia are long-standing. The
    U.S. Military Training Mission has worked bilateral training and
    support issues for years. We intend to build upon our long relationship
    of good will and mutual support with the Saudi Arabian military and do
    all we can to reinforce Saudi efforts to defeat terrorist organizations
    and promote stability.
    Other Arabian Gulf States and Yemen
        The Arabian Gulf states are valued partners in the global war on
    terror. Our operations in the region would not be possible without
    support from states such as Kuwait, Bahrain, Qatar, UAE, and Oman. The
    support provided includes overflight rights, base and port access, and
    staging rights. Kuwait has been host to the Combined Forces Land
    Component Command Forward Headquarters and our forces operating in the
    region. Bahrain is the home of the NAVCENT and Fifth Fleet. Qatar hosts
    CENTCOM Forward Headquarters and the United States Central Command Air
    Force (CENTAF)/9th Air Force Combined Air Operations Center. All
    members of the Gulf Cooperation Council (GCC) support important
    humanitarian and reconstruction efforts. All are donors to Afghan and
    Iraqi reconstruction efforts.
        In return, we continue to work closely with our Gulf partners in a
    variety of forums. We work with them in everything from bilateral and
    multilateral exercises to regional conferences and academic seminars.
    Officers from these countries are familiar sights at our military
    colleges and training centers. Our recent efforts with the UAE provide
    a concrete example of the benefits of cooperation. The UAE has
    developed the Gulf Air Warfare Center in Abu Dhabi, a state of the art
    facility modeled after the U.S. Air Force's Air Warfare Center. This
    facility will promote regional cooperation and combat effectiveness by
    hosting academic and flying courses attended by all of the GCC, as well
    as European allies.
        Theater security cooperation with the Gulf States remains important
    because we will continue to require access to the region and because
    the threat to these states from terrorism remains extremely high.
    Yemen's porous land and sea borders and loosely-controlled tribal areas
    provide opportunities for terrorists to transit, support, and supply
    their networks. CENTCOM engagement with Yemen is focused on improving
    their counterterrorism capabilities. SOF training of their
    counterterrorism force has measurably improved their capabilities and
    confidence, resulting in direct action operations that have disrupted
    foreign fighters and facilitators that previously viewed Yemen as a
    safe haven. Their recent cooperation with Saudi Arabia to gain control
    over cross-border smuggling of arms, explosives, and personnel has
    great potential. Although Oman remains concerned about illegal sea-
    borne immigration from South Asia and the possibility that terrorists
    may enter their country with economic refugees, it lacks the fiscal
    resources to adequately upgrade its military forces. Continued U.S.
    support to Oman will make the region less hospitable to terrorists.
    Egypt
        The Arab Republic of Egypt continues to be a strong partner,
    member, and ally in the global war on terrorism. Egypt's increase of
    overflight rights and Suez Canal transits were vital to our coalition
    victories in OEF and OIF. Egypt has donated over 60 tons of
    humanitarian aid to Afghan reconstruction and arms and ammunition to
    the new ANA. They deployed a field hospital to Afghanistan where it has
    treated over 13,000 patients and contributed demonstrably in achieving
    the goal of restoring Afghanistan's medical infrastructure to
    operational levels.
        The U.S. has maintained close military relations with Egypt since
    the signing of the Camp David Accords in 1979. Although Bright Star
    2003 was cancelled due to operational constraints, we remain engaged
    with the Egyptians on major regional events and future Bright Star
    exercises. Egypt's leadership role in the Arab world is important to
    reinforcing moderation and enhancing stability in the region.
        Our Security Assistance mission to Egypt is one of our largest and
    its objective is to assist Egypt to modernize all branches of their
    Armed Forces. Annually, we provide $1.3 billion for the procurement of
    U.S. manufactured weapons systems and support. These include the
    Patriot PAC 3, Avenger, Stinger Block 1, extended range multiple launch
    rocket systems (MLRS), etc. over the next 5 years. To date, 755 M1A1
    tanks have been manufactured at the Egyptian Tank plant. In addition,
    the U.S. provides $1.2 million annually for the IMET. Graduates of the
    IMET program are now rising to senior positions in the chain of
    command. Finally, in an effort to increase their regional coalition
    capabilities, Egypt's Ministry of Defense is building a 600-bed
    International Medical Center with national funds, while our Foreign
    Military Financing funding is providing medical equipment, furnishings,
    and training to train over 138 doctors and seventy nurses, at a cost of
    $132 million. Egypt continues to prove itself a key ally, supporting
    both OEF and OIF operations.
    Jordan
        Jordan is a stable country within a very dynamic region. The
    Israeli/Palestinian situation, the Iraq conflict, and the war on terror
    all impact Jordan's geopolitical climate. King Abdullah II supports a
    very strong military relationship with the United States. His active
    support for the coalition's efforts during OEF and OIF is essential to
    our success. Jordan deployed a key demining capability to Afghanistan
    that allowed the coalition to quickly set up air operations at Bagram
    airfield. They deployed and still maintain a field hospital in Mazar e
    Sharif that has provided medical care to over 234,000 Afghans since the
    end of hostilities. Their current effort of training Iraqi police is a
    major component of the coalition plan to improve security in Iraq.
        Our economic and military aid programs are appreciated by the
    Government of Jordan and are key elements of their defense plans. We
    have no better regional partner on counterterrorism and will continue
    to work closely with this important ally through combined training
    exercises, military exchanges, coalition deployments and a robust
    military assistance program.
    Central Asian States
        Our continuing engagement with these states addresses significant
    sources of instability in the region. Our partnership with these
    nations focuses on developing counterterrorism and counternarcotics
    capabilities, improving border security, and enhancing the
    professionalization of their military forces. Kyrgyzstan, Kazakhstan,
    Tajikistan, and Uzbekistan, for example, have undertaken programs of
    military reform designed to increase the professionalism of their Armed
    Forces. We will continue to foster security sector reform, encourage
    regional cooperation, and seek their constructive involvement in our
    effort to stabilize Afghanistan.
        It is clear that our relationship is mutually beneficial.
    Uzbekistan, Tajikistan, Kyrgyzstan, Kazakhstan, and Turkmenistan
    provide key access and overflight rights necessary to support
    operations in Afghanistan. The Government of Uzbekistan has provided
    access to Karshi-Khanabad Airfield at no cost to U.S. forces.
    Kyrgyzstan also provides U.S. basing at Manas. Tajikistan formally
    offered a battalion of troops and other elements to participate in
    peacekeeping efforts in Afghanistan in January of this year. Kazakhstan
    has provided engineering troops for OIF.
        Our engagement in this region supports the efforts of these nations
    as they move forward from their Soviet pasts. Military-to-military
    contacts and educational opportunities provided under IMET can enhance
    the reform programs that are in place. Through bilateral and
    multilateral exercises, we will develop greater interoperability and
    provide a positive example of a professional force subordinated to
    legitimate civilian authority.
        The Central Asian states continue to struggle with reform and
    enterprise, while their people clearly desire to participate in the
    growing prosperity enjoyed by other former Soviet countries. The risks
    associated with failure of these states include regional instability,
    drug trafficking, smuggling and safe haven for terrorists. Our security
    cooperation efforts aim to improve border control and enhance
    counterterrorism capabilities. al Qaeda, the Islamic Movement of
    Uzbekistan, and other extremist groups are active in Central Asia.
    Continued regional cooperation is essential to confront extremist
    groups in the area.
    Iran
        Our recent action to provide disaster relief to the victims of the
    earthquake in Bam, Iran provided the Iranian people a more accurate
    picture of the American character and demonstrates our commitment to
    reducing human suffering. The political situation in Iran remains
    complex. Tension is deepening between moderates who desire a greater
    voice in politics and the hard-line religious Mullahs who control the
    security forces and the mechanisms of political power.
        Iran has multiple centers of power and its closed society makes
    assessing their national intentions difficult. We will watch Iran
    carefully to try to prevent any destabilizing activities that could
    complicate our efforts and contribute to internal Iraqi frictions. We
    will continue to deter Iranian support of terrorism. Iran is also
    central to our counterproliferation planning and nonproliferation
    efforts. The International Atomic Energy Agency (IAEA) has confirmed
    Iran's clandestine nuclear activities and continues its oversight to
    demand compliance with their nuclear nonproliferation obligations.
        While generally thought to be built for defense, Iran continues to
    build a credible military capable of power projection within the
    region. It has the largest military capability in the region and has a
    record of aggressive military action in and around the Arabian Gulf.
        Iran's military force is the primary threat to the free flow of oil
    from the Gulf region. Their forces include a Navy of small attack boats
    carrying torpedoes and missiles that are well suited for the restricted
    confines of the Strait of Hormuz. A new generation of indigenously
    produced anti-ship cruise missiles and tactical ballistic missiles
    threaten both oil infrastructure and shipping. It is important for us
    to maintain reconnaissance capabilities to monitor these forces. To
    counter this threat our Global Naval Force Presence Policy ensures a
    robust carrier strike group and expeditionary strike group presence
    that demonstrates our commitment to unrestricted international access
    to the Gulf's resources.
        Iran's Revolutionary Guard Force and Intelligence Service (MOIS)
    are very active throughout the Arabian Gulf and the broader Middle
    East. While Iranian interests have not favored active sponsorship of
    anti-U.S. activity in Afghanistan and Iraq, it is clear that Iranian
    sponsored groups, backed by their intelligence services could create
    difficulties in both countries.
    Joint Warfighting
        During OIF our forces advanced the art of joint warfighting and
    built upon the experience we gained in OEF approximately 1 year
    earlier. Coalition forces struck the enemy at multiple points
    simultaneously while the main attack covered over 300 miles in 22 days.
    The result was the removal of Saddam Hussein's regime and the defeat of
    an opposing force of 28 divisions. Coalition land- and carrier-based
    air forces achieved total air superiority from the outset, disrupting
    Iraqi command and control networks, shattering air defenses, and
    preventing the assembly of large ground formations. Coalition army and
    naval forces opened waterways into Iraq, allowing for the delivery of
    humanitarian goods while major combat operations were ongoing.
    Additionally, SOF operated throughout Iraq and seized control of
    western Iraq almost in its entirety.
        Air, conventional ground forces, and SOF continue to demonstrate an
    unprecedented degree of agility, fight aggressively under uncertain
    counterinsurgency conditions, and retain the initiative in all areas of
    the battlespace. Recent technological advances do not remove the fog,
    friction, or uncertainty of war. Combined and joint teams operating at
    low levels dominate the enemy in every engagement and with proper
    intelligence, unravel terrorist cell structures. Operations in the
    movement phase of OIF represented a shift from joint ``deconfliction''
    to near full combined and joint integration. That integration continues
    in Iraq under the current conditions of combat. During Operation
    Sweeney in October 2003 through January 2004, for example, a British
    division commanded a large anti-smuggling effort that brought together
    British air and ground forces, U.S. naval forces, and a Marine
    Expeditionary unit (MEU). Significant operational coordination achieved
    by special operations, air and conventional ground forces in finding,
    fixing, and finishing insurgent cells and key leaders has resulted in
    considerable success. This joint integration at low intensity conflict
    operations is unprecedented.
                           proposed basing strategic
        CENTCOM's strategic basing plan is being developed in conjunction
    with other combatant commands, the Office of the Secretary of Defense
    (OSD), and the Joint Staff to ensure that it complements the basing
    strategies of adjoining combatant commands and supports the overall
    Global Basing Strategy. CENTCOM's basing strategy will complement the
    overall Global Basing Strategy by positioning key capabilities
    throughout the CENTCOM AOR to enable a rapid and flexible response for
    the execution of major combat operations in support of the global war
    on terror.
        Host nation support is key to CENTCOM's basing strategy. As such,
    site selection is made considering the improvement of host nation
    capabilities while avoiding the incitement of anti-American sentiment
        CENTCOM's strategic plan for basing calls for Forward Operating
    Sites (FOS), Cooperative Security Locations (CSLs) and the contingency
    use of ports and airfields throughout the AOR. These infrastructure
    sites have been identified to assure U.S. access to enable the
    projection and sustainment of forces within the AOR.
                                theater manning
        While our strategy in Iraq and Afghanistan involves turning
    security responsibilities over to indigenous forces, this strategy
    takes time to implement and our forces will have to remain engaged in
    both countries for a considerable amount of time. Trained forces in
    depth will prove critical to sustaining those efforts, conducting
    operations in support of the global war on terror, continuing theater
    security cooperation activities, and maintaining sufficient reserves to
    deter other potential adversaries. Because our efforts in Afghanistan
    and Iraq involve counterinsurgency operations in complex urban terrain
    as well as the need to employ dispersed forces across wide areas, there
    are great needs for infantry, reconnaissance troops, military police,
    rotary wing aviation, HUMINT, translators, interrogators, and civil
    affairs teams.
        Counterinsurgency operations and high value target (HVT) hunting
    creates a near insatiable demand for HUMINT resources. We need to
    expand our HUMINT forces (case officers, linguists, analysts, and
    interrogators), provide them with proper training, and build rewarding
    professional career paths to foster retention. Interrogators have
    proven to be a critical path for operations in both Afghanistan and
    Iraq and throughout the CENTCOM AOR. These skills are required from the
    tactical level to the strategic level. As our work to secure national
    stability in Afghanistan and Iraq matures, counterintelligence skills
    are another high demand low density asset to train for the future.
        We must invest in greater culturally literate HUMINT capabilities
    across the Services and build networks that not only provide discrete
    target information, but also help us anticipate enemy actions. We need
    more linguists who are fluent in Arabic, Farsi, Pahstu, Dahri, Urdu,
    Somali, and Swahili. Civil affairs personnel, interagency planning
    experts, and psychological operations specialists are also in short
    supply. We must continue to invest in the recruitment and training of
    such skilled people.
        Operations in Afghanistan and Iraq have generated high demand for
    other specialties. These include law enforcement specialists
    knowledgeable in international law and able to teach professional, high
    level policing skills such as criminal investigation techniques.
    Hundreds of thousands of tons of unexploded ordnance left over from
    decades of strife have spiked our demand for explosive ordnance
    disposal specialists who are also trained in techniques to counter
    IEDs. Because we are planning multiple complex operations
    simultaneously, we need more strategic field grade plans officers
    capable of conceptualizing theater strategy and are conversant in
    coalition and interagency operations. Information technology managers
    and systems programmers, and web system and database designers are
    needed to manage the large database and command and control structures
    we are employing to prosecute the global war on terror and conduct
    counterinsurgency operations in Afghanistan and Iraq.
        In addition to our conventional force requirements, we see a
    continued high demand for SOF throughout the CENTCOM AOR. SOF
    reconnaissance, deep insertion and surveillance assets, and aviation
    crews remain in great demand. SOF's capability to train, mentor, and
    operate with host nation forces is especially important in Afghanistan,
    Iraq, and throughout the AOR.
        We are grateful for the initiatives to fund incentives and quality
    of life programs to compensate and provide respite for those deployed
    for extended periods. The highly successful Rest and Recuperation Leave
    and Fighter Management Pass programs are boosting morale and increasing
    effectiveness. The expansion of Tactical Field Exchanges in Iraq and
    Afghanistan are important tools to sustain morale. Exchanges provide
    necessary and important comfort items and are the sole source of phone
    services for our troops. Other programs that are important to sustain
    the high morale of our forces under demanding conditions include Armed
    Forces Entertainment, compensation and entitlement initiatives, and the
    Child Care and Family Child Care Subsidy Programs. We applaud the DOD
    expansion of the Military One Source initiative and feel it is an
    effective complement to existing Service Family Support Center
    programs. The service men and women serving in the CENTCOM AOR
    appreciate the continued congressional concern for supporting programs
    that encourage reenlistment and officer retention. As always, our
    people remain the principal source of our strength.
                           critical mission enablers
        The missions in Afghanistan and Iraq have identified three key
    enablers that we rely upon; strategic lift, intelligence, and force
    protection. Our lack of in-theater infrastructure and assigned forces
    makes us dependent on strategic lift. Ongoing operations are creating
    unprecedented demands for fused intelligence across the entire force
    and we are improving every day. The insurgency tactics we are
    encountering put a heavy emphasis on organic force protection.
        Strategic air and sealift continues to enable our success. Once
    stability operations in Afghanistan and Iraq are completed, CENTCOM
    will be an active theater with a relatively small expeditionary
    footprint in the region. This means that CENTCOM will remain heavily
    dependent on pre-positioned equipment and agile forces to respond to
    contingencies. Adequate sealift and sea-basing capabilities in
    conjunction with our strategic air assets are absolutely vital to
    military success in our area of operations.
        Much has been done to develop common databases and an overarching
    intelligence architecture that permits common access and dissemination
    to all echelons. These efforts ensure effective collaboration across
    the intelligence community. However, just as important to this effort
    is a continuous, unimpeded flow of intelligence. Unmanned aerial
    vehicles (UAVs) have proven their value, and we must continue to expand
    their capabilities and integrate them into our intelligence networks.
    The requirement for more full motion video (FMV) and infrared (IR)
    video is an enabler at all levels of command. Once exposed to the
    revolutionary capabilities they provide, no commander wants to fight
    without them. The ability to see the enemy day or night and respond to
    his defenses and activities before making contact is changing tactical
    doctrine, especially in urban scenarios.
        CENTCOM has built a redundant intelligence, surveillance, and
    reconnaissance (ISR) network integrating strategic, theater, and
    tactical systems, but persistent surveillance is essential to
    maintaining situational awareness during Joint operations. Increasing
    the number of UAV systems, signals intelligence systems, and expediting
    the airborne common sensor program will improve our persistent
    surveillance capability. This capability can be further enhanced by
    expanding our capacity to fly more Predator UAVs simultaneously in our
    theater and by adding qualified linguists aboard signals intelligence
    aircraft. Improved sensors both on the ground and airborne will help
    distinguish between enemy and indigenous populations.
        We should recognize from our experiences in OEF and OIF, however,
    that we will not be able to achieve anything close to near-certainty in
    high intensity combat or counterinsurgency operations because enemy
    countermeasures and knowledge of enemy intentions lie beyond the reach
    of even the most sophisticated technologies.
        The requirement for Up-Armored High Mobility Multi-Purpose Wheeled
    Vehicles (HMMWVs) and Interceptor Body Armor (IBA) to protect our
    troops in Iraq and Afghanistan remains high. Due mainly to the
    development of the IED as the enemy's weapon of choice, our requirement
    for armored HMMWVs has steadily increased from 235 in May 2003 to 4,388
    in February 2004. We currently have 2,178 in theater, or 50 percent of
    the current requirement. The Joint Staff, Services, and other combatant
    commanders are currently redistributing worldwide stocks of Up-Armored
    HMMWVs. Funds that you provided in the Emergency Supplemental increased
    production from 78 per month in October 2003 to 148 per month in
    February 2004 and will further increase to 220 per month by May 2004.
    Accelerated production and redistribution should allow current
    requirements to be met by December 2004.
        OIF forces initially deployed with a combination of old Flak vests
    and the new IBA. The Defense Logistics Agency and Army managed
    production and distribution of the new IBA, which is composed of the
    Outer Tactical Vest (OTV) and Small Arms Protection Inserts (SAPI). One
    hundred percent of U.S. forces in Iraq now have the full IBA. One
    hundred percent of U.S. forces in Afghanistan have the new OTV and 86
    percent have SAPI plates. The remainder of the soldiers in Afghanistan
    will be issued SAPI plates by the middle of March.
    Military Construction (MILCON)
        CENTCOM's basing strategy supports the command's vision and mission
    by establishing bases and facilities that support operational and
    strategic needs throughout the region. Ongoing operations in support of
    the global war on terror and OIF and OEF have increased our basing
    footprint for the near term; primarily operating bases in Iraq and
    Afghanistan. To meet these requirements, components have already
    submitted contingency construction requirements totaling some $531
    million through CENTCOM and their component channels, for Joint Staff,
    OSD, and congressional consideration.
        Your continued funding support for MILCON provides needed
    infrastructure and facilities required to prosecute OEF, OIF, and the
    global war on terror. Between the fiscal year 2004 appropriation and
    the fiscal year 2004 supplemental, Congress authorized a total of
    $340.5 million in MILCON for projects in the CENTCOM AOR. However,
    additional contingency requirements continually emerge. CENTCOM has
    prioritized another 44 projects at an estimated cost of $531 million in
    urgent, unfunded contingency construction requirements. We submitted
    these requests to the Joint Staff in January 2004. We expect that other
    requirements will emerge due to changes in the situation, new missions,
    and the evolution of our basing strategy. Your support for these
    requests is important to our ability to sustain operations in the
    theater.
    Funding Priorities
        In research and development (R&D) funding--over $335 million was
    appropriated to address key force protection shortfalls and over $70
    million will fund R&D efforts to address some of the asymmetric
    problems our soldiers are facing, such as IEDs. DOD has established a
    counter-IED task force that will review, test, and field promising
    counter-IED technology to our forces. This effort is already bearing
    fruit.
        Our ability to fight and win throughout our theater of operations
    relies heavily on a robust, reliable command, control, communications,
    and computer (C\4\) network. Great progress is being made in enhancing
    our theater-wide C\4\ infrastructure, due in large measure to
    supplemental funds approved for commercialization of our tactical
    communications resources. The nature of the global war on terror,
    particularly counterinsurgency operations in our theater, however,
    places significant demands for collection and dissemination of
    intelligence products and information throughout all components, Joint
    Task Forces (JTFs), tactical units, and coalition partners. While we
    continue to pursue the resources necessary to meet these requirements,
    the ability to distribute intelligence to all the places remains our
    single biggest C\4\ challenge. Continued support of communications
    initiatives will ensure necessary capability to meet today and future
    requirements.
        CENTCOM's logistical difficulties stem mainly from limited
    infrastructure. We place high demand on strategic airlift and sealift;
    we lack the ability to provide in-transit visibility (ITV) on supplies;
    we need improvements in the tactical distribution of petroleum products
    and other goods via military trucks or pipeline. MILCON investments
    throughout our theater will improve through-put and force projection
    capabilities.
    Legislative Authority Changes
        Congress has been generous in providing CENTCOM with greater fiscal
    flexibility to support nations that provide us with access or assist
    our efforts. One such example is the CERP with Appropriated Funds
    (CERP-APF). This program is seen by the commanders in the field as an
    essential enabler. CERP-APF allows the commanders to seek and satisfy
    the immediate needs of the local population and demonstrate to the
    public our commitment to helping them. We seek you continued support
    for this authority.
    Concerns
        CENTCOM has been constrained in its support to nations that provide
    us with access or assist our efforts. Specific concerns include:

        Inability to use funds to:

             Upgrade permanent facilities.
             Pay for intra- and inter-theater airlift
            transportation for coalition personnel and material, including
            medical evacuation.
             Support and sustain the Afghan security forces and the
            Provincial Reconstruction Teams.
             Pay travel expenses of foreign military officer
            involved in coalition planning or operations while temporarily
            assigned to CENTCOM.

        Difficulty in facilitating coalition contributions to the global
    war on terror, combatant, combined forces, or JTF Commanders because of
    the inability to effect bailment or custodial transfer of United States
    military equipment to coalition forces for cooperative operations.
                                   conclusion
        CENTCOM is fully committed to the defeat of transnational terrorism
    and the creation of secure and stable environments in Iraq and
    Afghanistan. We will continually reassess the situation and improve our
    effectiveness against the enemy. Our command and control restructuring,
    including the establishment of CFC-Iraq and CFC-A, will improve the
    integration of our operations with interagency efforts and those of our
    coalition partners while permitting the CENTCOM headquarters to
    maintain a holistic view of the theater and direct the full range of
    our activities. Our staff will remain forward in Qatar extensively,
    especially during this period of multiple transitions in Afghanistan
    and Iraq. Eventually, the CENTCOM Forward Headquarters will move to Al
    Udeid Airfield from Camp As Sayliyah in Qatar. That move will increase
    our efficiency and allow us to reconstitute our mobile headquarters
    capability for other contingencies.
        The most important person in our theater of operations is the
    soldier, sailor, marine, or airmen on patrol in the middle of the
    night. We are committed to providing our troops and our coalition
    partners the resources they need to accomplish the mission. I would
    like to acknowledge the courage and dedication of our coalition troops
    and especially those Afghans and Iraqis who have joined us to win a
    peaceful and prosperous future for their children. We are committed to
    doing all we can to support them. We and our coalition partners will
    prevail in Afghanistan and Iraq and in the global war on terror because
    of the efforts of our service men and women and because we offer a
    positive vision and hope for the future.
        I want to thank this committee for your support to our command and
    our service men and women and also for your oversight of the vital
    operations we are undertaking.

        Chairman Warner. Thank you very much, General.
        General Jones.

       STATEMENT OF GEN. JAMES L. JONES, USMC, COMMANDER, UNITED
     STATES EUROPEAN COMMAND, AND SUPREME ALLIED COMMANDER, EUROPE

        General Jones. Mr. Chairman, I would like to echo the
    thoughts of General Abizaid in thanking the committee and the
    people of the United States for their support of our men and
    women in all uniforms involved in dangerous missions around the
    globe, not just in our respective AORs, but doing such
    wonderful things to provide the most visible example of
    democracy in action, a free people. Through their actions and
    through their presence they give hope to millions of people who
    hope to have a similar opportunity in life to live in peace and
    raise their families with prospects for better tomorrows.
        It is also a great pleasure to be at the witness table
    today with General John Abizaid. I know the committee is aware
    of this, because some members visited us in 1991 in northern
    Iraq when Lieutenant Colonel Abizaid was commanding officer of
    the airborne combat team from Vincenza, Italy, and I was the
    commanding officer of the 24th Marine Expeditionary Unit (MEU).
    I would like to remind the committee that Lieutenant Colonel
    Abizaid worked for me in those days, and I am extremely happy
    to be supporting him in his efforts today in the important
    billet that he holds.
        So it is a great honor, over a decade later, still to be in
    uniform and to be sitting along side this great soldier that is
    doing such a great job.
        Mr. Chairman, in my statement I deliberately included a lot
    about NATO this year because I think the committee has always
    had a deep and abiding interest in NATO. I had sought to, in my
    prepared remarks, show the linkage between EUCOM and NATO as
    NATO is transforming and changing. In 2003 NATO has sent a very
    strong signal that it is anxious and willing to engage in many
    areas of the world simultaneously, which is a signal departure
    from the NATO that we knew in the 20th century.
        This year NATO will go from 19 to 26 nations. It will
    welcome seven new member states. It will continue to administer
    ongoing and simultaneous operations in the Mediterranean, in
    the Balkans, and in Afghanistan. It will continue to develop
    the NATO Response Force in keeping with the guidance provided
    by the Prague capabilities commitment. That NATO Response Force
    went from a concept early in 2003 to a reality in the fall of
    2003. It now is a 9,000-man force in its second rotation. It
    has been demonstrated to be operationally effective, and will
    continue to grow in capability, reaching perhaps a mature size
    of between 15 and 20,000 soldiers, sailors, airmen, marines,
    and Special Operations Forces (SOF) per rotation.
        We also saw in 2003 the establishment of the Allied Command
    for Transformation, which is a major departure. It meant the
    consolidation of all operations under the billet of the Supreme
    Allied Commander in Europe for the Allied Command for
    Operations, which is the one I am privileged to be assigned to.
        We also have regenerated or are attempting to regenerate
    the Partnership for Peace (PFP) Program, which will lose seven
    members as they become full members of the alliance. We are
    embarked on a project to revitalize the Mediterranean Dialogue
    in that very important part of the world, both on the northern
    rim of the Mediterranean and on the southern rim. We are busily
    at work trying to bring to fruition the guidance of the Prague
    capabilities commitment and the Prague Summit.
        As if that was not enough, NATO has also taken on the task
    of transforming itself, and that transformation is ongoing. It
    is essentially the problem that we wrestled with domestically
    over the last decade, to take the 20th century warfighting
    concepts and bring them into the 21st century, with the
    economies of scale in our armies, navies, and air forces,
    marines, and SOF, to cut down the number of unnecessary
    headquarters, which NATO has done this year, and to make the
    forces more operationally usable and deployable and
    expeditionary.
        The reforms that are required span the entire skill set of
    the military culture, to include logistics, intelligence,
    transportation, and obviously the warfighting capability if
    necessary.
        So 2003 was an exciting year. 2004 advertises itself to be
    equally exciting, as NATO has signaled a strong desire to do
    more in Afghanistan. Recently we have proposed military advice
    on how NATO might expand to include five new Provincial
    Reconstruction Teams (PRTs) to the north and to the west.
    Admiral Feist is busily at work generating the force to support
    that reality, which I think will happen, and nations are
    deciding where they might wish to make individual contributions
    as we speak.
        I would like to underscore the relationship between CENTCOM
    and SHAPE on this matter, because coordination at the military
    level is extremely important. May I simply say that it has been
    ideal in all respects--on the ground, at the tactical level, at
    the operational level, and at the strategic level--and we are
    very grateful for the coordination and assistance that General
    Abizaid and his command have lent to the NATO operation.
        In EUCOM, the command that is responsible today for 93
    nations, we are also busily at work. We are paying attention to
    the greater Middle East because I believe this is where the
    focus of main effort will be for a considerable period of time
    yet, irrespective of what happens to Iraq in the short term.
        We are paying greater attention to Africa, both northern
    African and sub-Saharan Africa. As General Abizaid and his
    forces are successful in Afghanistan and in the Middle East,
    the purveyors and merchants of destruction, terrorism, WMD, and
    those who seek to create instabilities in the democracies of
    the world are looking for other places to hide. Africa is a
    huge continent and we are seeing indications of a willingness
    to move to Africa to start to develop their footholds and to
    export their particular brand of terrorism and instability.
        In operations, EUCOM is proud to have been the supporting
    command to CENTCOM in the prosecution of OEF and OIF. A
    significant percentage of cargo and personnel transited through
    our bases that we are privileged to occupy in Europe with the
    forbearance of our allies. With the exception of a single vote
    taken in the Turkish parliament, no U.S. force was denied air,
    land, or sea transportation modes anywhere through the alliance
    in Europe.
        I would particularly like to emphasize that Germany played
    an important role in facilitating the transfer of our forces
    and our cargo and continues to play an important role. As a
    matter of fact, in order to reduce the demand on our manpower,
    Germany contributed thousands and thousands of German soldiers
    to provide security for our bases and continues to aid
    significantly in that respect, and we are profoundly grateful
    to Germany for its assistance.
        EUCOM is also involved in transformation, as you alluded
    to, Mr. Chairman. Last year we finished a recommended footprint
    for the U.S. forces in Europe for the 21st century. That
    footprint proposal is being discussed and will be announced in
    due time. Suffice it to say that the study we completed is not
    a study that is bent on troop reduction for the sake of
    reducing forces. It is a study that is based on achieving
    greater strategic effect with transformational capabilities
    applied to forces based on forward presence and the
    reinforcement with rotational forces from our Army, our Navy,
    our Air Force, and our Marines.
        If adopted, it will allow us to be strategically more
    agile, more flexible, and present in most of the areas that we
    wish to be and need to be present in in order to make sure that
    we reduce the level of threats and combat and add to the global
    war on terrorism.
        I am satisfied that the budget request for 2005 meets the
    needs of the theater. If I may just highlight one aspect of the
    budget request having to do with military construction
    (MILCON). It has not been publicly released as to what bases
    will be maintained and what bases will be modified, and so the
    details of the plan are not public, but we did complete last
    year a study which included those installations that are of
    such enduring interest and importance to our capabilities that
    they would, regardless of the plan, they would probably remain.
        So we focus our request on making sure that those bases
    that we know are going to be useful and strategically important
    in the future will receive the MILCON funding that is required
    to keep the quality of life and the operational competence and
    the quality of work up to speed.
        So with that caveat, I would simply say that the budget
    request meets the needs of our forces in theater. With that,
    Mr. Chairman, I am happy to respond to any questions you might
    have.
        [The prepared statement of General Jones follows:]
                Prepared Statement by Gen. James L. Jones, USMC
                                i. introduction
        The United States European Command (EUCOM) remains fully engaged in
    protecting and promoting the national security interests of the United
    States in 93 countries covering nearly 46 million square miles (Chart
    1). Our area of responsibility (AOR) is astonishingly diverse and
    encompasses a full range of human and social conditions. EUCOM actively
    supports the prosecution of the global war on terrorism, while
    simultaneously preparing to implement a strategic transformation that
    will take advantage of both the opportunities and evolutions in the
    21st century international security environment.
        The global war on terrorism, unlike any war in the past, demands
    greater emphasis on closer relationships with friends and allies. EUCOM
    must remain engaged regionally in order to build upon international
    relationships and the many institutions which can help manage crises
    when they occur or, ideally, before they occur. As such, the value of
    forward basing, forward presence, and focused commitment remains an
    essential cornerstone of our strategy for the future.
        During the Cold War era, U.S. and North Atlantic Treaty
    Organization (NATO) force structures were primarily focused toward the
    eastern borders in order to ensure the territorial integrity of Western
    Europe against the Soviet Union's conventional and nuclear forces.
    Fortunately, the Soviet Union and the Warsaw Pact collapsed, as did
    many of the threats they posed. But the peace expected to emerge with
    the demise of the Soviet Union and the dawn of a new century has, thus
    far, failed to materialize. New threats have emerged that are
    qualitatively and quantitatively different from the conventional and
    traditional challenges of the past century. The rise of radical
    fundamentalism in many regions of the world provides the breeding
    ground for the actions of transnational groups who are unhesitant in
    their willingness to employ tactics of terror in order to coerce,
    blackmail, intimidate, and threaten populations and their sovereign
    governments. Narcoterrorists use these same tactics to secure their own
    financial gain and contribute to undermining the social fabric of free
    societies. Other criminal groups exploit the despair existing in
    nations beset with the demographic challenges of rising populations,
    declining resources, limited opportunity, and unstable governments.
    Transnational groups recognize no traditional political borders, making
    it extremely difficult for individual nations to effectively defend
    against the threat on a unilateral basis. Such groups have shown no
    moral hesitation in imposing their terror tactics against civilian
    populations or civil structures. Clearly, they represent an
    unconventional and asymmetric threat to our interests, and to those of
    our friends and allies. It is to this end that EUCOM is dedicated to a
    fundamental transformation on a scale not seen since its creation at
    the end of World War II.
        EUCOM's 21st century center of gravity reflects the continuing
    importance of the ``Greater Middle East,'' to include nations in the so
    called ``arc of instability;'' the Caucasus states, the Levant, and the
    ``ungoverned'' regions of North and West Africa. As a result of U.S.
    military successes in Afghanistan and Iraq, transnational groups are
    increasingly denied safe havens in traditional sanctuaries. They are
    moving into regions where nations already struggle with explosive
    population growth, resource scarcity, weak national institutions, and
    ineffective militaries.
        EUCOM's greatest contribution to security and stability lies as
    much in preventing conflict as it does in prevailing on the
    battlefield. This is accomplished through influence and engaged
    leadership, and is sustained only through our enduring and visible
    presence and commitment. The operational environment within EUCOM's AOR
    continues to evolve in ways that were largely unforeseen and difficult
    to predict just a few short years ago. Expanding Theater Security
    Cooperation requirements, an expanding NATO, instability in Africa and
    Eastern Europe, and the global war on terrorism largely define ongoing
    changes and require a comprehensive review of EUCOM's theater strategy.
    Today's security environment has been fundamentally changed by enemies
    without territory, without borders, and without fixed bases. These
    realities require us to be able to ``see'' everywhere and to be able to
    project power anywhere--quickly. From its geographic vantage point,
    EUCOM is ideally positioned to engage, disrupt, dismantle, and prevent
    terrorists from using their lines of communication and methods of
    resourcing which are critical to their ability to both operate and
    sustain themselves.
        EUCOM's ability to pursue, engage, and win decisively on a fluid
    and nonlinear modern battlefield will require a very agile and highly
    responsive force which is properly equipped, well-trained, and
    maintained at a high state of readiness. It should be agile,
    deployable, and sustainable. EUCOM's Strategic Theater Transformation
    (STT) plan, which is a component of the Department of Defense's (DOD)
    Integrated Global Presence and Basing Strategy, when approved, will
    permit EUCOM to transform itself in such a way as to be better able to
    meet the diverse challenges of this new century. The fundamental
    objective of our plan is to increase EUCOM's strategic effect through a
    fundamental realignment of basing concepts, access, and force
    capabilities. In no way should this signal a reduced commitment or
    interest in our region, but rather a shift in conventional thinking and
    desire to adopt new methods to better protect our interests in today's
    international security environment.
        NATO, which has been since its inception the fulcrum of
    transatlantic and inter-European security, remains the preeminent
    security alliance in the world; but it too is in the midst of dramatic
    change. The alliance's renewed commitment and revitalization are
    already evident by this year's pending expansion from 19 to 26 members,
    dramatic changes in its command structure, renewed focus on improving
    capabilities, and participation in global missions. They represent the
    beginning of NATO's most comprehensive and far-reaching changes in the
    history of the alliance. A transformed NATO, with greater agility,
    capability, and a new vision for engagement outside its traditional
    area, will be an essential and more capable partner for the United
    States. We should welcome and fully support this historic change in the
    alliance.
        The ongoing transformations in EUCOM and NATO are inextricably
    linked to the challenges inherent in today's international security
    environment. These simultaneous transformations are mutually supporting
    and complementary, the synthesis of which produces an effect greater
    than the sum of its parts. By its leadership and example, EUCOM
    supports both the alliance in its transformation as well as NATO member
    nations undergoing their own internal transformation.
        EUCOM's proposed plan is based on the assumptions that the United
    States:

             Desires to maintain its current position as a nation
            of global influence through leadership and the efficient and
            effective application of informational, military, economic, and
            diplomatic power.
             Remains committed to its friends and allies through
            commitments to global and bilateral organizations and
            institutions, and supports treaties and international
            agreements to which it is a signatory.
             Remains committed to a global strategy, which is
            forward based and composed of forward deployed forces in key
            areas, which contribute to the first line of defense of peace,
            stability and order.
             Supports in-depth transformation of its Armed Forces
            and basing structure, which is required in order to respond to
            21st century threats and challenges.
             Will continue to seek ways to mitigate or offset
            obstacles posed by 21st century global sovereignty realities
            through a reorientation of its land, sea, air, and space
            presence.
             Recognizes that the current concept and disposition of
            U.S. basing within EUCOM may not adequately support either the
            strategic changes attendant to an expanding NATO Alliance, or
            the rapidly changing national requirements of this AOR.
             Will seek to preserve those assets which are of
            enduring value to its mission, goals and national interests so
            long as their location measurably contributes to our global
            strategy, the NATO Alliance, and our bilateral engagements
            within the theater.

        The goal of EUCOM's transformation is to produce a strategic
    capability that is better able to support the National Security
    Strategy.
             ii. united states european command and nato operations
        EUCOM and NATO are currently engaged in numerous operations both
    inside and outside their traditional areas. The global war on terrorism
    has challenged peace loving nations to join together to defeat an enemy
    that has no honor, no state and no traditional military forces. The
    enemy of the 21st century is the terrorist who, for either ideological
    or monetary gain, will attack militaries and civilians
    indiscriminately. EUCOM and NATO's high level of involvement
    illustrates the important role these organizations play in directly
    confronting emerging threats.
    U.S. European Command Operations
        EUCOM is comprised of five components which conduct operations both
    in-theater and out of theater: U.S. Army, Europe (USAREUR) (62,000
    uniformed personnel); U.S. Air Forces in Europe (USAFE) (30,000
    uniformed personnel); U.S. Naval Forces, Europe (USNAVEUR) (12,500
    shore based uniformed personnel; 12,000 additional under the
    operational control of the Sixth Fleet); U.S. Marine Corps Forces,
    Europe (MARFOREUR) (150 uniformed personnel); and Special Operations
    Command Europe (SOCEUR) (2,000 uniformed personnel).
        EUCOM's missions are as wide as they are vast. We extend our
    operations throughout Greenland, Iceland, Europe, Africa, the Levant,
    Eurasia, and the Middle East, to include Iraq. At the height of EUCOM's
    participation in Operation Iraqi Freedom (OIF), more than 54,000
    soldiers, sailors, marines, and airmen from EUCOM's components were
    deployed for combat, or were in direct support of combat operations. In
    addition to conducting or supporting many bilateral and multinational
    operations, EUCOM forces also serve in the Balkans supporting NATO's
    military missions, and actively prosecute the global war on terrorism
    throughout our theater.
    In-Theater Operations
        Maritime Intercept Operations (MIO)
        EUCOM established the Joint Forces Maritime Component Commander
    (JFMCC), consisting of NAVEUR SIXTHFLEET Naval assets, in December 2001
    for the purpose of conducting maritime interdiction operations in the
    Mediterranean Sea. In combination with Operation Active Endeavour,
    JFMCC and NATO forces have hailed 39,500 ships (both U.S. and NATO) in
    order to ascertain specific information regarding the carrier, its
    cargo and destination. In addition, they monitored more than 30,000
    ships and conducted 45 compliant boardings (by a combination of U.S.
    and NATO forces). Nations of the western Mediterranean report as much
    as a 50-percent reduction in illegal immigration over the past year--a
    reduction directly attributable to this operation.
        Liberia
        In June 2003, EUCOM deployed SOCEUR to Liberia as a Joint Special
    Operations Task Force with 300 Special Operations personnel to
    coordinate and assist with the evacuation of 133 American citizens and
    32 third country nationals. EUCOM responded to the worsening
    humanitarian crisis by deploying Joint Task Force (JTF) Liberia, a sea
    based JTF of over 3,800 service men and women commanded by EUCOM's
    Southern European Task Force Headquarters. The American presence both
    offshore and on the ground was a source of confidence and stability
    that allowed the introduction of a U.S. supported peacekeeping force
    from the Economic Community of West African States (ECOWAS). The
    efforts of JTF Liberia went a long way toward mitigating a humanitarian
    crisis in Liberia and preventing it from becoming a source of regional
    instability by helping international organizations respond effectively.
        Georgia Train and Equip Program (GTEP)
        Since May 2002, GTEP has provided the Georgian government and its
    military with a very successful military training program that
    continues to enhance the Georgians' ability to protect their
    sovereignty and stabilize the region. By the time its mission is
    completed in May 2004, GTEP will have trained approximately 2,600
    Georgian soldiers. The successful December 2002 transition of this
    program's lead agency, from Special Operations Forces (SOF) to
    MARFOREUR, highlights the fact that conventional forces can be used for
    train and equip missions, freeing SOF for other missions. EUCOM, in
    coordination with the DOD and the Department of State, plans to
    continue its military transformation support to this fragile democracy.
    This effort and other similar security cooperation activities are
    examples of programs that require small investments but yield enormous
    dividends in our effort to promote peace, stability and democracy.
        Pan Sahel Initiative
        This initiative is a new effort to assist Mali, Niger, Chad, and
    Mauritania in detecting and responding to the migration of asymmetric
    threats across and within their poorly controlled borders. SOCEUR leads
    this program in training and equipping company sized, rapid reaction
    units, providing them the mobility, communication, navigation, and
    individual soldier skills essential for border security, internal
    defense, and counterterrorism efforts. Like GTEP, EUCOM plans to
    transition the lead for this program from SOCEUR to MARFOREUR in the
    near future. EUCOM also encourages the Maghreb countries (Algeria,
    Morocco, and Tunisia) to work more closely on common issues related to
    fighting terrorism.
    Out of Theater Operations
        Operation Enduring Freedom/Operation Iraqi Freedom
        In addition to our in-theater missions, EUCOM continues to provide
    essential support to U.S. Central Command (CENTCOM) and the global war
    on terrorism as a supporting command for Operation Enduring Freedom
    (OEF). This includes the provision of a U.S. Army medical evacuation
    helicopter unit in support of NATO's International Security Assistance
    Force (ISAF) in Kabul. Furthermore, intelligence capabilities and
    analysis from both EUCOM and CENTCOM are integrated to address key
    problem areas along mutual boundaries, to include Iran, Turkey, Syria,
    and East Africa. But perhaps the most important mission with which
    EUCOM has been involved has been its participation as a supporting
    command in OIF.
        U.S. Army, Europe
        USAREUR deployed over 26,000 soldiers to OIF, including the
    headquarters and major elements of V Corps, the 1st Armored Division
    based in Germany, and the 173d Airborne Brigade based in Italy. V Corps
    led a major element of the ground attack on Baghdad and continues today
    as the ground force controlling headquarters in Iraq. The night combat
    jump into northern Iraq by soldiers of the 173d Airborne Brigade was
    one of the largest infantry combat jumps since the Korean War.
    Currently, USAREUR is redeploying the nine separate brigades of V
    Corps, the 1st Armored Division, and the 173d Airborne Brigade to
    garrison, while deploying the 1st Infantry Division and elements of the
    21st Theater Support and 5th Signal Command to Iraq.
        U.S. Air Forces, Europe
        USAFE deployed 24 fighter aircraft and support personnel to the
    Iraqi theater and flew countless air refueling, surveillance and
    reconnaissance, and long-range strike missions from permanent and
    expeditionary air bases within EUCOM in support of OIF. C-130 aircraft
    from U.S. Air Forces in Europe continue to transport vital supplies and
    equipment bound for Iraq through Europe. Additionally, USAFE provides
    advanced basing support to both CENTCOM and U.S. Transportation Command
    at several air bases within the region.
        U.S. Naval Forces, Europe
        USNAVEUR exercised operational control of the U.S.S. Harry S.
    Truman and U.S.S. Theodore Roosevelt Carrier Strike Groups, with 22
    ships and 157 carrier-based aircraft. Strike Group aircraft flew over
    3,000 combat sorties from the eastern Mediterranean Sea and delivered
    precision-guided ordnance with coalition forces in northern Iraq. Naval
    cruisers and destroyers launched 36 Tomahawk Land Attack Cruise missile
    strikes into Iraq from the Mediterranean, while additional Navy units
    launched missiles from the Red Sea.
        U.S. Marine Corps Forces, Europe
        MARFOREUR, led by the 26th Marine Expeditionary Unit (MEU),
    demonstrated its operational agility by conducting an insertion of
    combat forces into northern Iraq while deployed in the Mediterranean
    Sea. Upon receipt of a mission tasking from the CENTCOM Commander, the
    MEU was inserted from Souda Bay, Greece, into northern Iraq during a
    critical stage of OIF where it provided a significant contribution to
    the combat power ashore and aided significantly in conducting
    conventional combat operations.
        Special Operations Command, Europe
        SOCEUR was directly engaged in both combat and civil military
    operations in northern Iraq as part of CENTCOM's Joint Special
    Operations Task Force-North.
        Theater Support
        EUCOM's success in supporting OIF is directly attributable to the
    theater support inherent in this geographical location, the men and
    women who serve in the command, and the infrastructure available.
    EUCOM's experience in OIF demonstrates the value of the European in-
    theater and ``en route'' transportation systems that provide critical
    power projection capabilities and facilities. There exists no better
    combination of rail, road, inland river, and air infrastructure systems
    from which to deploy our combat forces. This superb and mature network
    feeds some of the largest seaports in the world. Our theater
    transportation systems proved instrumental in the successful deployment
    of 54,000 soldiers and 29,000 short tons of supplies and equipment by
    air, and more than 290,000 short tons of supplies and equipment by
    ship, rail or barge through the EUCOM theater to Kuwait, Turkey,
    Israel, Hungary, Romania, and many other countries. Seventy percent of
    all Iraqi theater communications bandwidth and architecture continues
    to be routed through EUCOM controlled links. Additionally, the German
    Government continues to provide thousands of soldiers, police, and
    border guard forces to help secure EUCOM's installations, housing areas
    and communities.
        EUCOM's medical facilities continue to provide specialized
    recuperative and rehabilitative care to wounded and injured U.S. and
    allied soldiers from the Iraqi and Afghan theater of operations. To
    date, more than 9,280 patients have received treatment at Landstuhl
    Regional Medical Center, Germany and 1,380 received care at the
    Expeditionary Medical Facility/Fleet Hospital in Rota, Spain, prior to
    its redeployment in June 2003.
        Given the multiplicity of deployment infrastructure and nodes, our
    European operating bases provide for enhanced deployment infrastructure
    which complements our National structures. They also have the advantage
    of being an ``ocean closer'' to the regions where our strategic
    interests will be focused: the greater Middle East, Russia, Ukraine,
    and Africa.
    Reserve Component
        EUCOM is reliant upon the contributions of the Reserve component.
    Presently, there are over 4,800 Reserve and National Guard personnel
    deployed in-theater conducting a wide range of critical missions. The
    Reserve component is currently executing the entire Bosnia mission and
    almost two-thirds of our forces in Kosovo are reservists. Additionally,
    a large percentage of our intelligence personnel in EUCOM are activated
    reservists. Our reliance on the Reserve component is most acute in the
    intelligence, counterterrorism and logistics fields.
        Since the beginning of our operations in the Balkans, approximately
    30,000 Reserve component personnel have deployed to the region and have
    performed admirably. With the approaching successful completion of the
    military tasks mandated by the Dayton Peace Accords, we will continue
    to reduce our forces in the Stabilization Force (SFOR) in Bosnia and
    Herzegovina. This will also reduce the overall requirements for the
    Reserve component in our theater.
    North Atlantic Treaty Organization Operations
        History will show 2003 to have been a watershed year for the NATO
    Alliance. Contrary to some who claim that the best years are behind it,
    NATO demonstrated this past year its new vision for confronting
    security threats in a global context. Following the guidance of the
    2002 Prague Summit, NATO began a fundamental transformation program at
    a pace that has surprised even the most cynical observers. During 2003
    alone, the alliance conducted no less than five major and highly
    successful operations, most of them simultaneously.
        Stabilization Force
        In Bosnia Herzegovina, SFOR made significant progress toward
    completing its military tasks under the Dayton Peace Accords. With the
    Bosnians making important progress in reforming their military and
    disarming, the alliance has continued its drawdown of forces. As of
    April 1, the U.S. troop contribution will be 1,050 of the nearly 10,000
    troops currently in SFOR. Discussions are currently underway with the
    European Union (EU) to transition to a policing mission by year's end.
        As the SFOR mission draws to a conclusion, U.S. numbers are
    projected to decrease to a smaller number of personnel to support a
    stay-behind NATO headquarters element, to maintain a ``warm base'' (TF
    Eagle), and to continue our successful Persons Indicted For War Crimes
    (PIFWC) efforts. Recently, our international operations to apprehend
    PIFWCs were fundamentally restructured. PIFWC detention operations
    continue to be one of the great under recognized success stories of our
    mission in the Balkans. Of the more than 120 people indicted by the
    International Criminal Tribunal for Yugoslavia, 93 have appeared before
    the Tribunal, 21 remain at large today, and the remainder have died
    from a variety of causes.
        Kosovo Force (KFOR)
        NATO's KFOR continues in its mission to provide security in the
    region, as well as in assisting the United Nations (U.N.) Interim
    Administration in Kosovo. NATO's troop strength was reduced to 17,730
    in 2003 with U.S. forces contributing nearly 12 percent (2,010) of the
    personnel. NATO will conduct Periodic Mission Reviews to assess future
    force requirements in Kosovo. It may be possible to transition to a
    Deterrence Presence profile in KFOR during 2004, which may allow the
    U.S. to reduce troop strength to around 800, but this is a decision for
    the North Atlantic Council (NAC).
        Operation Concordia
        This operation in the Former Yugoslav Republic of Macedonia, which
    was the EU's and NATO's first collaborative effort, came to a
    successful conclusion in 2003. The success of this mission demonstrated
    that NATO-EU military collaboration in an embedded EU planning cell at
    Supreme Headquarters Allied Powers Europe is a good thing.
        International Security and Assistance Force
        NATO began its most ambitious operation, ISAF in Afghanistan, in
    response to a U.N. Security Council Resolution in August 2003. The
    deployment of nearly 6,000 NATO and non-NATO troops to Afghanistan
    represents the first combined force global deployment for the Alliance.
    On 30 December 2003, ISAF expanded its mission and assumed command of
    the German-led Provincial Reconstruction Team (PRT) in Konduz, a
    province in northern Afghanistan. The North Atlantic Council has
    subsequently approved a Concept of Operations (CONOPs) for the gradual
    expansion of the ISAF mission to include a greater number of PRTs. A
    full Operations Plan, based on this approved CONOPs, was submitted to
    the International Military Staff at NATO Headquarters in late February
    2004. NATO's assumptions of this mission, the deployment of these
    forces to Afghanistan, and ISAF mission expansion in the near future
    are all physical manifestations of the Alliance's recognition of its
    responsibility to engage in security challenges outside its traditional
    area.
        Operation Active Endeavour
        This is NATO's maritime interdiction operation in the Mediterranean
    Sea and is contributing significantly to the global war on terrorism.
    Beginning in 2001 as part of NATO's Article V response to the 11
    September 2001 attacks, Operation Active Endeavor has produced the most
    comprehensive maritime surveillance picture in the Mediterranean in
    years and has proven to be extremely successful in interdicting
    criminal and terrorist activities that use the Mediterranean as a sea
    line of communication. It is conceivable that Operation Active
    Endeavor's maritime interdiction operation could be extended into the
    Black Sea.
        Operation Display Deterrence
        In February 2003, NATO conducted Operation Display Deterrence, an
    Article IV mission, in response to Turkey's request for NATO's
    assistance to deter an attack from Iraq.\1\
    ---------------------------------------------------------------------------
        \1\ Article IV states that ``The Parties will consult together
    whenever, in the opinion of any of them, the territorial integrity,
    political independence or security of any of the Parties is
    threatened.''
    ---------------------------------------------------------------------------
        Operation Iraqi Freedom
        In addition to NATO missions, the Alliance provided assistance to
    the member countries that deployed forces to Iraq in support of OIF.
    NATO provided assistance to the lead nation, Poland, as well as to
    Spain, Hungary, other NATO nations, and several non-NATO members that
    deployed forces for this important mission.
        Air Policing
        Finally, NATO is planning for a modernized and expanded air
    policing and air defense mission, the goal of which is to extend the
    alliance's air defense coverage to member and soon-to-be member nations
    who currently do not have the capability to provide it for themselves.
    Regardless of the eventual course of action, NATO should adopt a
    comprehensive solution that covers all 26 member nations in the defense
    of their airspace and fulfills the alliance's Article V
    responsibilities.
        Operationally, NATO is the busiest it has been in its 50-plus year
    history. The alliance has deployed more than 22,000 personnel to the
    Balkans, over 2,600 to Operation Active Endeavour, and nearly 6,000 to
    Afghanistan under the NATO flag. While not a NATO mission, NATO member
    nations have also deployed more than 17,000 personnel in Iraq in
    support of OIF. Training, interoperability and past operations and past
    operations through the alliance enhanced the coalition's mission.
          iii. united states european command and nato transformation
        In light of the ever-evolving international security environment
    and newly emerging threats, both EUCOM and the NATO Alliance have
    embarked upon a process of comprehensive transformation to better
    prepare both organizations to face today's transnational threats. The
    current strategic environment demands we find ways to maximize our
    effect, working both unilaterally and with our allies. We are
    participating in a deliberate process requiring study, in-depth
    consultation and focused prioritization. As we transform we will
    continually review our progress and the metrics by which our
    requirements are determined. Our transformations must be tailored to
    meet not only the threats of today and tomorrow, but those we will
    confront in the years ahead. EUCOM and NATO transformation efforts are
    inextricably linked and will have complementary and reinforcing
    effects.
    U.S. European Command Transformation
        Three Areas of Focus
        EUCOM was extremely active in 2003 as it contributed to the global
    war on terrorism, to include providing support for the war in Iraq, and
    engaging with our allies to improve security cooperation efforts, and
    working a number of bold new initiatives to transform our presence in
    the theater. Over the past year, EUCOM has emphasized three areas
    important to transformation. First we continued the reduction and
    realignment of ``legacy'' infrastructure, which was better suited to
    support Cold War requirements. Second, we reassessed the manner in
    which our forces are deployed and assigned to this theater from the
    United States. This included the reorientation of our forces toward the
    southeast and south to more suitably reflect EUCOM's expanding
    strategic responsibilities. In addition to being joint, agile,
    sustainable, and highly mobile, future forces operating in our region
    will be a combination of both permanently based and rotational units.
    Finally, EUCOM has adopted operational concepts which capitalize on
    innovation, experimentation, and technology in order to develop a force
    that can achieve a greater strategic effect. Simply put, the
    traditional military principle of ``mass'' no longer equates to
    commitment or capability. We will continue to re-tailor our forces
    based on an expeditionary model much better suited to meet the demands
    of the 21st century.
        Basing Concepts
        Essential to achieving this strategic effect are the development of
    basing and force manning models that develop the principles of an
    expeditionary philosophy. To achieve the first, we envision a series of
    smaller forward operating bases (FOBs) and forward operating locations
    (FOLs) strategically located throughout the AOR. Such bases will be
    anchored to several existing Joint Main Operating Bases (JMOBs), which
    are of enduring strategic value and remain essential to theater force
    projection, throughput, and sustainment. Pre-positioned war reserve
    material at Joint Prepositioned Sites (JPS) will augment this basing
    plan by allowing units to ``fall in'' on essential equipment that will
    capitalize on the strategic advantage of being an ``ocean closer'' to
    engagement, influence, and conflict. JPS also present the added
    benefits of significantly reducing the requirements placed upon an
    already overburdened strategic transportation system. They allow for
    the extension of the range and effect achievable by FOBs and FOLs
    through augmentation with the logistical support of selected
    prepositioned sites. This new basing plan, together with the strategic
    positioning of JPS, will help effectively posture our forces, in order
    to counter current and future threats.
        Operational Concepts
        EUCOM is working with the Office of the Secretary of Defense (OSD),
    the Joint Staff, the Service secretariats, the military departments,
    and EUCOM's Service components in developing a viable plan to meet the
    security challenges of the 21st century. Changes proposed in our
    transformation plan represent a dramatic shift in EUCOM's operational
    concepts in support of an overarching global strategic realignment of
    U.S. forces. The United States' level of interest, commitment, and
    military capability resident in this theater should no longer be
    measured exclusively by the number of troops permanently based in
    Europe. The new measure will be based on strategic effect by the
    effective application of the combination of both forward basing and
    rotational presence.
        Efforts to realign our basing concepts and our force capabilities
    will revolve around implementing a strategy more reflective of the new
    security environment and our national interests. Power projection
    platforms and operating bases will be located in such a manner as to
    compensate for finite limitations of strategic air- and sea-lift
    assets, and they will capitalize on the utility of existing bases, and
    our ability to pre-position needed military equipment and stocks. The
    analysis and planning leading to the transformation of EUCOM's
    strategic footprint will yield important results in future years as we
    continuously refine and implement the STT plan.
        As EUCOM shapes the theater with FOBs and FOLs to facilitate the
    projection of U.S. military power within and beyond the AOR, we will
    maintain leadership within NATO and across the AOR that is credible and
    capable. This is a function of both force positioning and the provision
    of transformed, expeditionary, joint capable, and ready forces. These
    forces will be characterized by increased deployability and tremendous
    agility, responsive across the full spectrum of joint and combined
    operations. The presence of a genuinely transformational force
    stationed in Europe will measurably enhance EUCOM's capacity to
    energize NATO's transformation and to garner support among NATO allies
    for an expanded role in the global war on terrorism. It will
    demonstrate our commitment to them through usable, transformed, and
    versatile military forces.
        Efficient Basing Granfenwoehr
        A pillar of our transformation is our world class Joint
    Expeditionary Training Center at Grafenwoehr and Hohenfels in Germany.
    Situated in the heartland of Europe, this ``center of excellence''
    places the United States on the ``high ground'' to lead a transformed
    NATO in the global war on terrorism. It is in close proximity to our
    NATO partners, NATO aspirants, and Partnership for Peace (PFP) nations
    and consists of the finest set of firing ranges and maneuver training
    areas available to U.S. and NATO forces today.
        In particular, the Center's six sophisticated, urban training sites
    are embedded within a sizeable maneuver area with realistic non-English
    speaking civilians representing diverse ethnic groups which more aptly
    simulates the environs in which our soldiers will operate. Training in
    the tactics, techniques, and procedures for in urban warfare, stability
    operations, and other global war on terrorism-related operational
    requirements greatly enhances our interoperability with our NATO
    partners. The Grafenwoehr expeditionary training site has been
    instrumental in training our forces for a variety of combat and
    peacekeeping tasks essential to our success in the Balkans, Liberia,
    and the global war on terrorism, most notably in Iraq. Further, as a
    JMOB, the training center provides a world class power projection
    platform, capitalizing on the advanced European transportation
    infrastructure and existing status of forces agreements to deliver
    forces to contingency areas through EUCOM and into the CENTCOM AOR.
        As we engage in our transformation efforts, we must be mindful of
    the impact these actions will have on our most important asset--our
    people. EUCOM is accountable to servicemembers and their families, from
    whom much has been asked, and who have sacrificed greatly as the
    theater posture is adjusted. Regardless of the course of action that is
    ultimately selected, we will implement reforms in a manner that takes
    into account the quality of life of our families, both military and
    civilian alike.
    NORTH ATLANTIC TREATY ORGANIZATION TRANSFORMATION
        NATO Command Structure
        The alliance, while extensively engaged in international security
    matters, is also simultaneously undertaking the most significant
    transformation in its history. At the Prague Summit in November 2002,
    NATO members agreed to undertake many significant changes. The first of
    these was the streamlining of the NATO command structure. During this
    past year, the alliance deactivated Allied Command, Atlantic; activated
    the Allied Command, Transformation (ACT); and renamed Allied Command
    Europe as Allied Command, Operations (ACO). Additionally, NATO
    identified 12 subordinate regional headquarters for eventual
    deactivation, a process that will occur over the next several years,
    but one that is already underway. The last significant change to the
    NATO command structure will be the activation of the alliance's third
    joint headquarters, Joint Headquarters West (JHQ(W)) in Lisbon in March
    2004, which will serve as the headquarters for a sea-based combined
    joint task force. This headquarters, along with JHQ North in Brunssum,
    The Netherlands, and JHQ South, Naples, Italy, will exercise command
    and control over the NATO Response Force on a rotational basis.
        NATO Response Force
        Perhaps the most important initiative emerging from the Prague
    Summit was the decision to create the NATO Response Force, a truly
    transformational capability that will give the alliance significant new
    military capabilities. For the first time in its history, NATO will
    have a trained and certified, standing, integrated force of sea, land,
    air, and special operations components under a single commander. The
    Very High Readiness element of the NATO Response Force will have the
    capability to begin deployment within 5 days and will be able to
    sustain itself for up to 30 days.
        NATO inaugurated the ``proof of concept'' initial capability of the
    NATO Response Force on October 15, 2003, and held its first live field
    training exercise, Allied Response 2003, in November. The exercise
    involved over 1,000 personnel, 21 aircraft, and 3 ships from 12
    nations, demonstrating the interoperability and expeditionary
    capabilities that exist today.
        The first two NATO Response Force rotations are purposefully
    designed to be smaller and more limited in scope in order to facilitate
    the development of necessary doctrines, training and certification
    standards, operational concepts, and readiness reporting criteria and
    systems.
        The NATO Response Force will achieve Full Operational Capability no
    later than October 2006 and will provide NATO with a capability of
    responding with a military force during the ``Deterrence Phase'' of a
    developing crisis. This force will have a range of operational
    capabilities that can be used across the spectrum of conflict--rapidly
    and sequentially. While the NATO Response Force will have the
    capability for high intensity operations if required, it will also be
    available to conduct humanitarian operations, peacekeeping/peace
    enforcement, and forcible entry operations. It will also be capable of
    conducting simultaneous operations.
        The creation of the NATO Response Force is significant beyond the
    fielding of an important new military capability. It represents a
    manifestation of the alliance's commitment to change in order to better
    confront the emerging threats of this new century. In creating this
    force, the alliance advanced the NATO Response Force from concept to
    physical reality in less than a year. Such rapid and comprehensive
    change is virtually unprecedented in the alliance, and provides a basis
    for increased optimism for the future.
        While challenges in the area of Combined Joint Statement of
    Requirement (CJSOR) shortfalls and defining the best command and
    control structure currently exist, it is clear that the NATO Response
    Force is the centerpiece for alliance military transformation and
    operational capability in the new security environment. The NATO
    Response Force is truly the transformational vehicle for NATO's
    military capability in the 21st century, and is worthy of our most
    focused support.
        Statement of Requirements
        Another key initiative that will likely pay an important dividend
    is the full definition of NATO's military requirements for the 21st
    century. This will allow member nations to base the construction of
    their own force structure on what is needed to support the alliance.
    This statement of requirements will go a long way toward ensuring the
    alliance's transformation in the future.
        Noncommissioned Officer (NCO) Development Program
        The final major initiative emerging within the alliance during 2003
    was the creation of an NCO Development Program and the establishment
    and installation of the first senior noncommissioned officer for ACO.
    This position was created in order to provide NATO members, invitees,
    and partner nations with a resource to transform and rebuild their own
    noncommissioned officer corps and enlisted force, should they choose to
    do so. The many and diverse changes in NATO signal a tectonic shift
    that has already contributed significantly to our mutual security
    interests.
        Partnership for Peace
        NATO is also reexamining a number of programs related to its
    numerous bilateral relationships. It is only appropriate that I mention
    that this year marks the 10th anniversary of the NATO-led PFP Program.
    This highly successful program has produced seven new NATO members who
    will accede into the alliance this year. An example of how the
    relationships formed in PFP have paid great dividends for both the
    alliance and the U.S. is the ongoing use of important facilities in
    several PFP countries in the global war on terrorism. Now is the time
    to seek a revitalization of PFP. At the core of current NATO thinking
    on PFP adaptation is an interest in refocusing it both geographically
    and functionally, shifting geographical emphasis to Central Asia, the
    Caucasus, and the Mediterranean Dialogue nations and shifting
    functional emphasis to institution building, reform, and
    interoperability.
        PFP's transformation cannot be achieved in isolation from alliance
    transformation objectives and processes, U.S. national security
    priorities, ACO's objectives, and the national and regional security
    priorities confronting nations today. Refocusing PFP on the new
    missions, new tasks, and new capabilities of the alliance in response
    to new threats challenging the international community is critical to
    its successful evolution. Any PFP adaptation should reduce the
    capability and interoperability gap between the allies, increase the
    availability of ``useable forces'' and strengthen potential coalition
    military capabilities. NATO's core objective is to establish in PFP the
    appropriate focus, priorities, exercises, and supporting activities to
    ensure that it produces operationally effective partners for NATO-led
    Crisis Response Operations and NATO Response Force actions.
        NATO-Russia Interoperability Program
        This program, initiated in May 2003, has changed the character of
    the overall traditional NATO-Russia military-to-military program.
    Focused on the objective of establishing permanent interoperability,
    NATO and Russia have implemented 21 activities in 2003 and 35 more are
    scheduled for 2004. Logistics, strategic lift, and theater missile
    defense activities will also be included in the focus of work with
    Russia this year. Russia has returned to PFP and NATO welcomes a
    renewed relationship under development with the Russian General Staff
    and its Main Operations Directorate.
        NATO-Ukraine
        Another important bilateral affiliation is the NATO-Ukraine
    relationship. Ukraine's progress in the implementation of its
    Membership Action Plan was noted by the Foreign and Defence
    Ministerials in Brussels in December 2003. The strategic relationship
    with Ukraine is a central focus of the ACO. Ukraine's role in the PFP
    Program, troop contributions to KFOR, and its troop commitments to OIF
    are significant and are to be commended.
        NATO's leadership has laid the groundwork for its successful
    transformation. The clear military guidance given at the 2002 Prague
    Summit has set the path. Some of these initiatives are as ``simple'' as
    opening dialogues and establishing agreements. Other initiatives come
    with a price tag. It is incumbent upon the alliance to ensure the
    necessary resources are applied to make concepts realities.
                 iv. requirements for strategic implementation
        The quality of EUCOM's infrastructure has a profound impact on all
    operations, training and security cooperation activities, as well as
    the quality of life of servicemembers. Given this fact, and the current
    state of our facilities, infrastructure investment and maintenance is
    the most critical funding requirement. Key theater investment
    requirements must be met for infrastructure investment, family housing,
    ``en route'' infrastructure, anti-terrorism force protection, theater
    command, control, communications, and computers (C\4\) modernization,
    and intelligence, surveillance, and reconnaissance (ISR) requirements,
    as well as quality of life programs.
    Theater Infrastructure
        Our most important program in USAREUR is Efficient Basing
    Grafenwoehr, which focuses on structuring forces and basing facilities
    to be best postured for training and responding to current and emerging
    threats in the greater Middle East and Africa.
        Efficient Basing Granfenwoehr is an initiative to enhance
    readiness, gain efficiencies, and improve the well being of 3,500
    soldiers and 5,000 family members by restationing a brigade combat team
    from 13 installations in central Germany to a single location at
    Grafenwoehr, Germany. This initiative began in earnest with the
    approval and appropriation of $25 million for planning and design in
    fiscal 2001; construction began in fiscal 2003 with appropriation of
    $69.9 million and was followed by $88.1 million in fiscal 2004. An
    additional $77.2 million is budgeted for this program in fiscal 2005.
    It is our intent to complete the program in fiscal 2006 at a total cost
    of $629.2 million. This major program supports the future strategic
    footprint in the theater and will maintain the Grafenwoehr, Hohenfels,
    and Vilseck areas as key installations as part of a future JMOB. This
    ``world class'' and unique training facility located in southern
    Germany offers realistic field training opportunities that have given
    United States forces an incomparable advantage in combat operations
    over the last two decades.
        In fiscal 2003, EUCOM identified 13 installations in the Giessen
    and Freiberg area for closure. As this process concludes in 2005 and
    these 13 bases are returned to the host, it is imperative to keep the
    Efficient Basing Grafenwoehr program intact and on track. Given its
    enduring nature as a JMOB, the planned improvements and enhancements to
    facilities and infrastructure at Grafenwoehr will be central to all
    potential manifestations of EUCOM future basing strategies.
        The return of Rhein Main Air Base to German authorities, scheduled
    for completion in 2005, gives further impetus to the continuing need
    for a military construction (MILCON) program designed to upgrade the
    operational capability at both Ramstein and Spangdahlem Air Bases.
    These upgrades to vital theater transportation nodes are essential for
    EUCOM to be able to sustain the level of strategic throughput required
    to support OIF and other global contingencies and operations.
        USAFE is also continuing its efforts to consolidate its
    geographically separated units throughout the theater at its enduring,
    major operating bases. Similarly, NAVEUR is proceeding with its
    recapitalization plan for Naples, Sigonella and Rota. In coordination
    with SOCEUR is exploring potential joint basing options for the SOF
    stationed in-theater. This will provide EUCOM greater crisis response
    capabilities, enhance joint training opportunities, and more
    effectively position assets for use in likely areas of employment.
    Joint basing will become a way of life throughout the European theater.
    This concept will continue to be developed as our transformation plan
    moves forward.
        EUCOM appreciates the efforts of Congress to provide for the
    sustainment, restoration, and maintenance of existing facilities, as
    well as for new military construction. The very successful use of the
    ``build-to-lease program'' to recapitalize family housing throughout
    the theater has substantially decreased our military construction
    requirements, but the need for the renovation of existing housing still
    accounts for almost 30 percent of EUCOM's request for such funding. We
    will not invest resources in housing we anticipate closing in the near
    future except for ensuring maintenance and quality-of-life standards.
        ``En route'' infrastructure for mobility forces passing through
    this theater remains important for U.S. global operations. EUCOM
    continues to manage this requirement closely in partnership with
    CENTCOM and the U.S. Transportation Command through the European En
    Route Infrastructure Steering Committee. The Committee is seeking
    innovative solutions to identify and rectify potential shortfalls in
    order to provide the flexibility and capacity required to support any
    mission to any location within or through this theater. EUCOM's goal is
    to co-locate NATO infrastructure capability at bases where there is
    already a U.S. presence when it makes good sense to do so. By ensuring
    that U.S. and NATO infrastructure programs are coordinated and
    complementary, an overall reduction in construction costs to both the
    U.S. and the alliance can be achieved, while efficiency and
    effectiveness of operations are simultaneously increased.
    Family Housing
        EUCOM has begun to make the significant investments needed over the
    next decade to enhance our support infrastructure and to take care of
    our people. Service members and their families see the positive trends
    in infrastructure and are grateful to Congress for providing the
    funding needed to make this possible. However, a great deal of the
    theater's infrastructure remains inadequate and too many servicemembers
    continue to live and work in dilapidated facilities spread over
    inefficient, geographically separated installations.
        The well-being of our military families is linked to readiness,
    retention, reinforcement of core values, and mission accomplishment.
    The quality of work and the on time completion of the single and family
    housing renovations are impressive. The DOD-wide goal is to eliminate
    substandard housing by 2007. While the NAVEUR will meet this goal, the
    USAFE and USAREUR are projected to complete the goal by 2009. Funding
    to accomplish this for servicemembers and their families continues to
    be a critical element in attracting and retaining the high caliber
    personnel who make the U.S. military the best in the world.
    Force Protection
        EUCOM continues to enhance its force protection posture through
    physical site improvements at its installations and improved
    intelligence operations with coalition partners and law enforcement
    agencies. Our emphasis on public awareness, training, physical security
    upgrades and formal agreements with U.S. State Department clearly
    delineates force protection responsibilities for DOD personnel
    throughout the theater.
        During the past year, EUCOM's service components have made
    considerable improvements to their overall force protection posture.
    NAVEUR was able to employ waterside barrier systems at their primary
    ports. The Department of the Army funded seven Large Vehicle Cargo
    Inspections Systems for USAREUR. USAFE successfully obligated $14.2
    million in Defense Emergency Relief Funding for force protection
    projects. In addition, EUCOM received $3.1 million from the fiscal 2003
    Combating Terrorism Readiness Initiatives Fund (from the Chairman of
    the Joint Chiefs of Staff) to meet emergent antiterrorism needs at
    several installations. It is imperative we continue to adequately
    resource these critical force protection manpower and security
    requirements to enable EUCOM to meet the many challenges of the future
    and to effectively protect our personnel and facilities.
    Theater Command, Control, Communications, and Computers Modernization
        Network-Centric Warfare and Information Superiority operations in
    EUCOM's Network Battlespace require continued progress in C\4\
    modernization. We will embrace those advances in C\4\ capabilities
    derived from DOD-sponsored joint programs such as Teleport, Global
    Information Grid Enterprise System and the Mobile User Objective
    System. With Congress' help, focused attention on single integrated
    strategic and tactical architectures, DOD programs, and our own
    strategic transformation initiatives, EUCOM can provide the requisite
    networks needed to improve interoperability.
    Intelligence, Surveillance, and Reconnaissance
        EUCOM continues its work to establish an integrated ISR capability
    to increase the likelihood of detecting, tracking, and interdicting
    asymmetrical threats. EUCOM needs an increase in ISR assets--from
    indications and warning to battle damage assessment--coupled with more
    robust analytical resources, to prosecute the global war on terrorism
    and to provide ``forward homeland security.'' Improved collection
    capabilities for JTF commanders and multinational forces should include
    broad area search and surveillance platforms with extended loiter
    capability that are both survivable and stealthy. This ``persistent
    ISR'' must have the ability to continuously gather intelligence from
    the modernized signals used in global networks, as well as a capability
    to collect electro-optical, infrared, and radar imagery.
        Interoperability is crucial to leverage the information collection
    of NATO and non-NATO partners and to augment theater human intelligence
    (HUMINT) capabilities with those from the DOD and the Central
    Intelligence Agency (CIA). Sufficient capabilities in this regard are a
    major focus of the EUCOM Integrated Priorities List and the Joint
    Quarterly Readiness Review reports.
        As EUCOM continues its transformation, there will be an increased
    requirement for theater intelligence assets and national technical
    means to acquire information across all intelligence disciplines. EUCOM
    is appreciative of Congress' continued support of its intelligence
    requirements. We will invest funding in defense intelligence
    transformation efforts and programmatic shortfalls in intelligence core
    mission capabilities. Our highest intelligence priority remains having
    sufficient numbers of well trained personnel with human intelligence
    and language expertise, in order to support our counterterrorism
    analytical efforts.
    Quality-of-Life Programs
        Our most precious resources, servicemembers and their families are
    our number one combat multiplier. The excellence of our force is the
    direct result of our concentrated and sustained commitment to their
    quality of life. Our military communities must be resourced to provide
    a strong and predictable capability to support the necessary
    infrastructure, housing, schools, health care, child care, family
    support, and community services needs of servicemembers and their
    families.
        We urge Congress to favorably consider three quality-of-life
    projects that support Efficient Basing Grafenwoehr; construction of the
    elementary school ($36.2 million), Vilseck High School renovation ($9
    million), and the Dispensary Dental Clinic ($13 million).
        In our quality-of-life strategy, we stress that our forward
    deployed forces, their spouses and children deserve a fair compensation
    system, good places to live, quality educational opportunities,
    meaningful work, challenging off-duty opportunities, and access to
    quality health care. We are aggressively pursuing a series of
    initiatives designed to help improve the employment and career
    educational posture for our families. Chief among them is the continued
    improvement of educational opportunities for our family members and
    efforts to enhance spouse career development opportunities.
        The quality of DOD's dependent education programs ranks very high
    in determining the quality of life of our servicemembers and our
    civilian personnel. We are very proud that this system is recognized as
    a benchmark for other public school systems. EUCOM is grateful that
    Congress provides the support to enrich our children with such great
    opportunities. These schools, with nearly 48,000 students, need your
    continued support and funding to ensure high educational standards are
    maintained.
             v. united states european command strategic resources
        Theater Security Cooperation (TSC)
        Within EUCOM, we have a variety of resources, programs, and
    policies available to aid us in developing and implementing our TSC
    strategy. The value of these strategic resources cannot be overstated.
    Our TSC implementation plan is derived from the Secretary's Security
    Cooperation Guidance and is specifically designed for our theater.
    Security cooperation builds and nurtures relationships that protect
    U.S. strategic interests, enhance allied and ``friendly'' capabilities
    for self-defense and coalition operations, and provide for peacetime
    and contingency access and ``en route'' infrastructure.
        Since September 11, 2001, the vast majority of the 93 nations in
    the EUCOM AOR have offered or provided intelligence, basing access,
    over-flight rights, forces, and equipment, as well as other forms of
    support, to our efforts in the global war on terrorism. The degree of
    support EUCOM received from our allies is directly related to the
    effort and attention given to the security cooperation program.
        EUCOM's strategic vision is best achieved in concert with allies,
    partners, and friends. Security cooperation efforts in-theater include
    working with many nations throughout the AOR in a variety of programs.
    We are increasingly working in Africa to improve intelligence,
    peacekeeping capabilities, and overall regional stability. We are
    increasing military cooperation with Russia, and developing new
    relationships with countries of the Caucasus and Caspian regions. These
    efforts have protected and strengthened important U.S. economic and
    security interests, while assuring our European allies that the U.S.
    remains committed to European security and to the alliance.
        Within our TSC strategy are several security assistance programs
    that are vital to implementing foreign policy guidance and attaining
    national security objectives. They promote interoperability with U.S.
    forces and help build professional, capable militaries in friendly and
    allied nations. EUCOM supports military security cooperation in
    partnership with 43 Offices of Defense Cooperation and 72 Defense
    Attache Offices. EUCOM's chief programs include:

             Foreign Military Financing (FMF) provides critical
            resources to assist nations without the financial means to
            acquire U.S. military goods, services, and training and access
            to U.S. expertise in defense restructuring and management. It
            is an essential instrument of U.S. influence.
             International Military Education and Training (IMET)
            and Expanded IMET (E-IMET) provide educational opportunities
            emphasizing and reinforcing civilian control of the military
            and promote domestic stability in a region where armies are
            often the principal organizing institution in society. These
            are some of the most prominent and effective tools the U.S.
            possesses to advance the principles of responsible governance,
            to provide stability to newly-formed democracies, and to imbue
            militaries with the importance of the civil-military
            relationship. IMET also enables military-to-military
            cooperation and interoperability, which enhances our ability to
            assemble and operate as part of a coalition.
             Foreign Military Sales (FMS) demonstrate the continued
            primacy of trans-Atlantic defense relationships to U.S.
            security interests. FMS encourage interoperability between
            forces within EUCOM's AOR, help modernize the militaries of new
            friends and partners, and assure a strong U.S. presence in the
            development and implementation of the Prague Capabilities
            Commitment.
             Joint Combined Exchange Training (JCET) exercises are
            small, low cost, and low visibility exercises that are
            essential to keeping regionally aligned SOF trained in mission
            essential tasks, and are an indispensable tool that enhances
            EUCOM's TSC strategy. JCETs are uniquely tailored with
            personnel (ranging from 12-250) who possess certain skill sets,
            along with special equipment that is focused on a particular
            region to accomplish a prescribed mission or task. SOCEUR
            coordinates the JCET program for EUCOM. We have conducted as
            many as 50 JCET exercises in a single year. This year we plan
            to conduct 30. JCET events focus on the global war on terrorism
            and enable the U.S. to build the intelligence required to find
            and fix terrorist targets. Other important aspects of our TSC
            strategy are the training and educational programs that are
            available through the George C. Marshall European Center for
            Security Studies; the Africa Center for Strategic Studies; the
            Near East-South Asia Center for Strategic Studies; the NATO
            School; the African Contingency Operations and Assistance
            (ACOTA) program.
             The George C. Marshall Center continues to be one of
            EUCOM's most important security cooperation assets for
            achieving U.S. goals and objectives with other nations. The
            Marshall Center mission is to create a more stable security
            environment by advancing democratic defense institutions and
            relationships, promoting active, peaceful, security
            cooperation, and enhancing enduring partnerships among the
            nations of America, Europe, and Eurasia. The Center is crucial
            to building trust and confidence with the civilian and military
            leaders of more than 50 nations within our AOR. To date, over
            3,000 graduates and 10,553 non-resident participants have been
            influenced by the center, allowing the United States to build
            successful coalitions in the global war on terrorism. More than
            169 graduates of the Marshall Center hold key positions as
            ministers of defense, service chiefs, cabinet officials,
            ambassadors, flag officers, and parliamentarians. This growing
            network is an investment that is reaping valuable dividends in
            stability, security, and cooperation.
             The Africa Center for Strategic Studies continues to
            provide a series of seminars, symposia, conferences, and
            outreach programs designed to promote stable governance and
            democratic values in the African defense and security sectors.
             The Near East-South Asia Center for Strategic Studies
            conducts executive and senior executive seminars to foster
            professional defense planning and the function of a military
            establishment in a pluralistic society. Israeli, Tunisian,
            Algerian, Moroccan, and Mauritanian military personnel
            participate.
             The NATO School is a EUCOM-supported activity in
            Oberammergau, Germany, under the operational control of the
            Allied Command, Transformation. Its primary mission is to
            conduct courses, training, and seminars in support of NATO
            strategy and policy, including cooperation and dialogue with
            military and civilian personnel from non-NATO countries.
             ACOTA, formerly known as the African Crisis Response
            Initiative (ACRI), is a Department of State program supported
            by EUCOM. The program develops indigenous military trainers and
            equips African national militaries to conduct peace support and
            humanitarian relief operations. The program's goal is to
            increase the capabilities of these militaries in areas such as
            human rights, their interaction with civil society,
            international law, military staff skills, and small unit
            operations. Elements of a Ghanian Brigade, which completed
            staff training last year, is currently deployed to the Congo
            where it is currently participating in a peacekeeping
            operation. As additional countries in Africa receive training
            under the ACOTA program, regional member nations will acquire
            new capabilities to enhance regional stability. This year
            Senegal, Botswana, Zambia, Mali, Malawi, Benin, and Mozambique
            are scheduled to participate in the ACOTA training program.

        State Partnership Program
        This program assists partner nations in making the transition from
    authoritarian to democratic governments. This program, administered by
    the National Guard, matches emerging democracies in the EUCOM theater
    with partner states in the U.S. There are currently 23 U.S. states
    partnered with 21 foreign nations. The State Partnership Program has
    been so successful that DOD has approved establishing new partnerships
    and is funding an expansion of the program to Africa, beginning with
    South Africa and Morocco. Although the challenges faced by African
    nations differ considerably from those of Eastern Europe, many are
    ready for the opportunity that this program provides. For a modest
    investment, candidate nations receive access to the expertise of an
    entire American State government infrastructure, from public health to
    wildlife management. The impact is inspiring.
        Interagency Coordination
        Today's asymmetrical threats demand a new emphasis on interagency
    coordination. Coordination among U.S. Government agencies, especially
    those with skills in law enforcement and financial asset investigation,
    along with allied forces, nongovernmental and private voluntary
    organizations, and regional and international organizations is vital to
    our strategic efforts in our theater. As the security challenges facing
    our Nation grow in complexity and diversity, there is an increasing
    requirement to bring together different skill sets to better inform
    leaders and establish new perspectives so that our capabilities can be
    maximized to their greatest potential.
        Joint Interagency Coordination Group for Counterterrorism (JIACG-
            CT)
        In keeping with the Secretary of Defense's guidance, EUCOM has
    established a JIACG-CT in order to synchronize and coordinate EUCOM and
    interagency activity in the global war on terror and in our strategic
    plan for the region. Our JIACG-CT facilitates communications among the
    various agencies, contributing immeasurably to our understanding of and
    our efforts to contain proliferation, illegal immigration, and
    narcoterrorism. The JIACG, as the staff coordination entity for
    interagency representatives, allows EUCOM to rapidly access non-DOD
    agency information and operations in the integrated execution of
    national policy. The JIACG also maintains contact with embassy legal
    attaches while counterintelligence, analytical, operational, and policy
    staffs collaborate with their DOD and non-DOD counterparts in our
    missions. Additionally, the EUCOM intelligence staff, in coordination
    with the DOD Counterintelligence Field Activity (CIFA), co-sponsors
    liaison officers at INTERPOL Headquarters in Lyon, France, and in the
    U.S. national office.
        Joint Analysis Center (JAC)
        The JAC at Royal Air Force Base Molesworth in the United Kingdom is
    an irreplaceable asset as the theater intelligence analysis center. The
    JAC operates 24-hours a day, 7 days a week fusing critical elements of
    intelligence for the command. The breadth of this AOR requires a
    robust, all source intelligence capability that only a fully resourced
    JAC can provide. The JAC fully utilizes its reach back capability to
    national intelligence agencies and has well developed relationships
    with NATO members, allies, and coalition partners that allows for a
    more integrated intelligence sharing process. In addition to active
    operations in the Balkans, Africa, and the Caucuses, the JAC supported
    CENTCOM before and during OIF and continues to do so today.
        The JAC also benefits from interagency cooperation. In our AOR,
    many successful counterterrorist operations are the result of close
    cooperation and information sharing with our allies. EUCOM's
    integration of U.S. and multi-national law enforcement and intelligence
    reporting has given us insight into terrorist support infrastructure,
    recruitment, and training. EUCOM is working closely with interagency
    representatives, coalition partners, and U.S. embassy teams to further
    develop interagency plans.
        During the past year, EUCOM hosted ambassadors and defense attaches
    at several conferences in an effort to unify the interagency
    cooperation in-theater, confer on matters relating to the global war on
    terrorism, and discuss ``ways ahead'' that take full advantage of all
    the instruments of power necessary to achieve the United States'
    objectives. Such conferences underscore our commitment to develop
    broader approaches to interoperability within resources available and
    to better coordinate interagency assets.
                                 vi. conclusion
        EUCOM is fully and actively engaged in a diverse and expansive AOR,
    while simultaneously supporting an adjacent theater. The challenges of
    an expanding NATO, human trafficking and drug trafficking, sanctuaries
    and transiting of terrorists, instability and ethnic diversity in
    Africa and Eurasia, and theater security cooperation initiatives--
    define the environment and demand a paradigm shift in EUCOM's theater
    strategy. Today's multifaceted world requires operational capabilities
    that are more agile, mobile, responsive, and expeditionary. To achieve
    the United States' national security objectives, EUCOM is restructuring
    its theater posture and adapting its force structure and basing plan.
        As EUCOM seeks new and innovative alternatives to improve its
    operational capabilities, we celebrate the value of traditional
    relationships that have withstood the test of time. The true importance
    of the alliance and the presence of EUCOM should not be measured in
    wars and conflicts fought, but rather in ones that have been averted.
        As one looks to the future of the NATO Alliance, there is much
    cause for optimism. A great alliance should be able to do great things,
    and NATO's leadership and member nations are making the necessary
    decisions today to allow the alliance to do great things in the future.
    The NATO transformation process is making remarkable progress. While
    the NATO Response Force will continue to drive NATO transformation,
    NATO command structure realignment, as well as NATO deployments to out
    of area operations, underscores the alliance's willingness to embrace
    change in order to remain a relevant and viable security partner.
        As we undertake the necessary steps to transform the theater, we
    must be mindful of our leadership role in global affairs and cognizant
    of its responsibilities. Leadership and influence cannot be achieved
    from our distant shores alone; they must be forged through close and
    personal relationships, shared experiences, presence, and tangible
    support to time honored commitments. Our Nation earned the respect of
    the entire world when we stood side-by-side with our friends and allies
    in Europe for nearly a half century. As our interests expand, we should
    not abandon the character of a strategy that cultivated so much
    goodwill, resulting ultimately, in an historic victory. Our expanding
    alliance openly seeks both our leadership and our commitment. EUCOM's
    true value to our Nation is the uncompromising leadership we provide
    and the indispensable influence that can only be attained by our
    presence. This is also our best chance for success in fighting the
    global war on terrorism and, in bringing about a more peaceful and more
    prosperous world.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Warner. Thank you very much.
        Colleagues, we will proceed on a first round of 6 minutes
    each.
        General Jones, those of us who have had the privilege of
    being on this committee for many years recall instances when
    Senator Stennis, Senator Jackson, Senator Goldwater, and
    Senator Tower would have to rally the forces against the cry at
    home: Let us bring NATO back to the shores of the United
    States. There seems to be a little rumbling here and there on
    that score.
        Speaking for myself, I believe very strongly in the
    doctrine of forward-deployed forces. We have had a long
    association in NATO. I am not suggesting that we bring it all
    back. But even the thought, at this particular point in time in
    the war on terrorism, of making any significant reduction of
    forces concerns me greatly.
        Could you describe your assessment of this movement, and
    your own personal, professional views on the importance of
    keeping and maintaining the forward-deployed forces of NATO,
    and how the challenges of even a greater NATO role in Iraq and
    Afghanistan are coming about? I think that this is certainly
    not the time for any reassessment of that. What you recommend
    to the DOD with respect to restructuring by reducing NATO
    installations in Western Europe and putting in smaller units in
    the nations that are soon to join NATO.
        General Jones. Thank you, Mr. Chairman. I come from the
    view that forward basing is extraordinarily important. The
    lesson of the 20th century is that forward engagement has
    probably precluded as many wars as it has aided our capacity to
    fight and win them. I think all of us who wear the uniform or
    are associated with the national security are extraordinarily
    proud of the dividend that forward engagement plays.
        Not only is it strategically important because it places
    you closer to where you might have to actually use your forces,
    but equally important is what your forces do on a daily basis.
    In EUCOM we have forces deployed not only all over Europe, but
    also Eastern Europe, assisting our friends and allies in the
    transformation of their forces, teaching Eastern European
    allies who desire to have noncommissioned officer (NCO)
    structures in their forces that have been foreign to them as
    members of the former Warsaw Pact how to do that, how to train
    NCOs in our schools, how to aid some of our African friends and
    allies to better protect their borders through the small
    expeditionary teams that go and teach counterterrorism and
    antiterrorism. We develop common tactics, techniques, and
    procedures.
        I believe the United States, by virtue of its successful
    and ongoing transformation, provides for NATO a very good and
    very important example as to what can be done through the
    proper reduction of forces. Mr. Chairman, we reduced our forces
    by somewhere between 37 and 40 percent during the decade of the
    1990s, but we made them operationally more capable, more agile,
    more sustainable, and more expeditionary.
        This is the direction that NATO wishes to go. The strong
    leadership provided by the forces that are forward deployed as
    examples, as friendly partners and helpful allies, is
    extraordinarily important. The three component commanders--
    Admiral Johnson, General Bell, and General Fogelsong from the
    Air Force--are all NATO commanders and as such bring their
    experience to NATO to help NATO with this very important period
    of transformation.
        It is particularly important for us to appreciate that
    because the degree of success that NATO has is going to
    significantly lighten the load that we traditionally carry
    almost by ourselves. To the extent that we achieve the goals of
    the Prague capability commitments and we help our friends and
    allies transform themselves from a very large land-based army-
    centric infrastructure to more efficient, more appropriate
    force levels with great reliance on technology and the
    techniques of the 21st century warfighting, commanders like
    General Abizaid will have more forces to draw on because more
    allies will be more capable.
        It has been estimated that within the NATO Alliance in 2003
    only between 3 and 4 percent of forces are actually
    expeditionarily deployable. We seek to make dramatic changes in
    that in a very short period of time, and I have been
    extraordinarily impressed with the interest that chiefs of
    defense all over the alliance have in making their forces more
    usable.
        So the value of being forward deployed, I think, goes
    almost without saying. It is as important to our national
    security and our national interest as anything else that we do.
        With regard to Iraq, Mr. Chairman, we have received no
    tasking from NATO to prepare any military advice on how NATO
    might operate in Iraq. But I should emphasize a point that you
    made and that is that there are NATO allies who are in Iraq.
    The Polish-led multinational division received NATO help, NATO
    assistance, in making its deployment from Europe to Iraq, as
    did other NATO nations, and we are extending the helping hand
    to any nation that wishes to have that assistance in the
    future. So that will continue until I am, at least as the
    Allied Commander, I am tasked by the North Atlantic Council to
    provide military advice.
        With regard to Afghanistan, it is a different matter----
        Chairman Warner. If they were to take such action you would
    simply go out and not have to do anything more than put up a
    sign on the door saying that the units are there and it is
    structured overnight, am I not correct, as a formal NATO unit?
        General Jones. I am sorry, sir; I did not understand.
        Chairman Warner. You could structure it overnight. With the
    assets that you have in country in Iraq now, were the council
    to act formally the next morning that unit would be stood up;
    is that correct?
        General Jones. If NATO wished to act, there are several
    ways in which it could act very quickly to establish a NATO
    flag and a presence. Yes, sir, that is correct.
        Chairman Warner. My time is concluding. In Afghanistan, you
    are looking there at NATO taking over even a greater role in
    what time frame?
        General Jones. As opposed to Iraq, in Afghanistan I have
    been tasked to prepare a plan to provide more assets and more
    capability, to establish up to five PRTs within as short a time
    frame as possible. That is ongoing work as we speak. Some
    nations have stepped right up to the plate and said: We wish to
    provide a PRT.
        General Abizaid and I are in constant contact on how we
    deconflict his operation from the NATO operation. So there will
    not be a military difficulty in doing that.
        Chairman Warner. Lastly, General Abizaid, give us a little
    greater detail on the threat scenario in Iraq and what we are
    learning. There is a change in the composition of the
    individuals and to such an extent there are units that are
    working against the coalition partners, a greater emphasis on
    people coming from beyond the confines of Iraq in-country to
    participate in these actions against the coalition forces.
        General Abizaid. Senator, in November, I was fairly clear
    that the main threat in Iraq came from former regime elements
    (FREs), ex-members of the Iraqi intelligence services, the
    Republican Guard units, special security organizations, et
    cetera. After the capture of Saddam Hussein, to a certain
    extent we saw a diminishment of their activity. But they
    continue to play an important role in the insurgency that is
    being conducted in the area of Baghdad, ar-Ramadi, and up into
    Tikrit.
        On the other hand, a lot of the loyalty of the FREs seems
    to be shifting towards extremists, and certainly there are
    indications that, along with the professional terrorist groups,
    such as Zarqawi, Ansar al-Islam, al Qaeda, and others that are
    operating now in Iraq, that some of this FRE capacity is
    cooperating with them.
        In addition, we have foreign fighters that infiltrate in
    through various means. The borders are very long and, despite
    good efforts by Iraqi and coalition forces, infiltration
    continues. Most of the infiltration continues to come from
    Syria into Iraq, although a certain amount also comes from
    northern Iran into Iraq.
        But the number of actual foreign fighters that we continue
    to engage, capture, kill, et cetera, remains relatively low to
    the overall insurgent activity we see, which is primarily
    Iraqi. But I would say, Senator, that there is no doubt that
    the nature of the terrorist tactics have changed and the nature
    of the insurgency is changing. As they have become unsuccessful
    in operations against us, they have targeted what they consider
    to be the key node, which is emerging Iraqi security capacity.
    So you will see a continuing attack profile against Iraqi
    police, Iraqi leadership, Iraqi Civil Defense Corps (ICDC)
    units, et cetera, in the hope that by undermining the emerging
    Iraqi security capacity they will derail the process of moving
    towards an Iraqi transitional sovereign authority.
        Chairman Warner. Undoubtedly they are trying to incite a
    civil war type of situation. I do hope that there are no signs
    of that coming to the forefront.
        General Abizaid. I guess I am very optimistic, but I
    believe there are many more people inside Iraq trying to hold
    it together than tear it apart. There is certainly a
    possibility that things could move toward civil war. We
    certainly know that the Zarqawi network is attempting to foment
    civil war. That certainly was the motivation in the attack
    against the Shia yesterday.
        I believe that everybody understands that for a moderate
    government to move forward, to take its place in the
    international community of nations, will require a lot of
    cooperation among various groups, political and ethnic. I think
    we see in the transitional process for restoring sovereignty an
    awful lot of good cooperation among many parties.
        So I remain optimistic that, with continued security
    emphasis from coalition forces and our Iraqi partners and a
    solid political process that offers legitimate hope for the
    future, that we will be successful there.
        Chairman Warner. Senator Levin.
        Senator Levin. Thank you, Mr. Chairman.
        General Abizaid, we read in the paper this morning that the
    Shia in Iraq are calling for the maintenance of their own
    militias. Can you give us your opinion as to what the
    implications of that are?
        General Abizaid. Sir, ever since we have been in Iraq the
    major Shia political party, SCIRI, has been advocating the
    standup of the Badr Corps militia as a formal security force
    inside of Iraq. Of course, we did not recognize the Badr Corps
    during major combat operations in the movement phase of the
    war, and we still do not recognize them, nor do we believe that
    the standup of external militia to the established security
    organizations that are starting to mature in Iraq is a good
    idea.
        On the other hand, we have allowed Badr Corps members and
    officers to enlist in the ICDC, the Iraqi Army, participate in
    the police activities, and to informally work as parts of the
    security apparatus in some of the holy site areas around Najaf,
    Karbala, and other places up in Baghdad.
        So while we value the opportunity to bring a number of
    experienced Shia into the security apparatus of Iraq, we are
    not looking for Badr Corps units to stand up. I think it would
    be a destabilizing event because it would give the impression
    that ethnic militia are standing up and create the impression
    that they are standing up for other than strictly defensive
    measures, which would not be good for Iraq.
        Senator Levin. General Abizaid, there is a plan now to
    transfer sovereignty to some entity on June 30 or July 1. In
    your judgment, from a military perspective, how important is it
    that the transfer of sovereignty have the support of the Iraqi
    people, that the entity to which sovereignty is being
    transferred have that support?
        General Abizaid. Sir, I believe it is absolutely essential
    if we are going to be successful in Iraq. The single most
    important thing that must emerge, I believe, is a legitimate,
    sovereign authority that is viewed by the majority of Iraqis as
    representing their interests and their hopes for a better
    future. Senator Levin, we have, despite our best efforts, been
    perceived as the occupation force of Iraq and the broader
    Middle East, and it is important that we move from this period
    of perceived occupation to one of partnership.
        Partnership with a legitimate Iraqi authority with a strong
    executive core, I believe, will allow us to move forward in a
    positive direction.
        Senator Levin. General, it is my understanding that our
    senior uniformed leaders were not involved in the planning for
    the stability operations phase, so-called Phase IV, of this
    effort. I think you were director of the Joint Staff during the
    planning of the operations. Do you know whether it is true that
    our uniformed military was not involved in the planning for
    these stability operations?
        General Abizaid. Sir, there are of course many levels of
    activity that took place concerning what we called then Phase
    IV operations. There was certainly planning that went on in
    CENTCOM that I know about, that I participated in when I was
    the deputy commander there and when I was the director of the
    Joint Staff, and the Joint Staff participated in some level of
    Phase IV planning activity. But the uniformed military was
    primarily focused on operations that would require the buildup
    of the force and the conduct of the combat operation, and most
    of the activity regarding Phase IV stability planning took
    place in the Office of the Secretary of Defense (OSD), although
    the Joint Staff was represented in that.
        Senator Levin. Given the fact that violence was foreseen
    for the so-called stability operations phase, or Phase IV, is
    it your personal view that it would have been beneficial for
    professional military advice of senior uniformed leaders to
    have been sought and considered as part of the planning
    process?
        General Abizaid. Sir, it is my belief that our opinion was
    sought and was considered to a certain extent. But our focus
    was primarily on the mission at hand. I certainly believe that
    the stability operation that emerged in Iraq has not really
    surprised us, although you may find that surprising for me to
    say. Certainly there are difficulties that were not fully
    anticipated, but we never thought it would be easy, and we
    conveyed that to our leaders.
        Senator Levin. Is it your personal judgment that the
    professional uniformed leadership should have been involved in
    the planning of that phase to a greater extent than it was?
        General Abizaid. It is always difficult for a person to
    look back and say what should have been done. There are always
    things that we can do better. I am not so sure that I would say
    there should have been more uniformed work on it, but I do
    think that we as a Nation can do better in the manner in which
    we engage our entire interagency planning. The lesson that I
    would take from the planning of stability operations is that we
    have great power, and we know that these operations require
    military, economic, diplomatic activity for success, and the
    synchronization of that effort is something that we do well,
    but we should do better.
        Senator Levin. Thank you.
        My time is up. Thank you, Mr. Chairman.
        Chairman Warner. Senator McCain.
        Senator McCain. Thank you, Mr. Chairman.
        I would like to thank both General Abizaid and General
    Jones for their service to our Nation. To me they are two
    American heroes and I am grateful for their service.
        General Abizaid, I believe we now have the largest number
    of guardsmen and reservists on active duty since World War II.
    Roughly, it will be 38 percent. Are you concerned about the
    strain on the Guard and Reserve and the consequent lack of
    retention because of the extended deployments of guardsmen and
    reservists?
        We accept that they are doing an outstanding and
    professional job. I am not talking about the job they are
    doing. I am talking about the retention of these outstanding
    men and women in the Guard and Reserves.
        General Abizaid. Senator, I think we should be concerned
    about the long-term effects on not only the Guard and Reserve,
    but also those that are active duty people, with regard to how
    long they are deployed, how long they are away from their
    family. In the Guard and Reserve it becomes even more of a
    concern because of employment concerns, although, interestingly
    enough, when I talk to them in the field, which I do
    frequently, I detect a great commitment and a tremendous amount
    of pride in what they are doing. I have not detected from them
    what I would call the warning signs that they are going to
    leave in large numbers.
        I think we have to consider this thing very carefully. I am
    also very concerned about junior officers in particular for
    both Reserve and active.
        Senator McCain. Well, I do not want to debate it, but I am
    hearing something different from the families. Again, they are
    doing a superb job. There is no doubt about that. But it is
    hard to make an argument for someone to stay in the Guard if
    they are constantly deployed on active duty. Either become an
    active member or leave. I think we will pay a very heavy price.
        I would like to address one more area with you. I am not
    sure that the members of this committee or the American people
    know exactly how things are going to work once authority is
    passed over to the Iraqi government, whatever that might be at
    that time. So let us have a for-example scenario.
        The IGC or the Iraqi government, whatever it is, is now in
    charge in Iraq. There is a violent demonstration in downtown
    Baghdad which the Iraqi police and Armed Forces, whatever they
    are, are unable to contain. Then who gives you orders, and who
    carries them out, and who decides who goes and who stays, and
    under what circumstances?
        General Abizaid. Sir, according to the language that I saw
    in the Transitional Administrative Law, it is clear that there
    is a desire by the Iraqi side, as well as the other people that
    have interests in the emergence of a stable Iraq, that the
    multi-national force commander, the coalition commander, will
    maintain operational control of coalition forces and Iraqi
    forces for a period to be determined.
        Senator McCain. Does that mean that the decision to deploy
    troops into an area of conflict is made by the military
    commander, not by the Iraqi government?
        General Abizaid. That is correct, Senator. It also means
    that, while Iraqi police will trace the chain of command to the
    Ministry of Interior and conduct their local law enforcement
    activities under the Ministry of the Interior, Iraqi military
    forces will have a what I will call a title 10 relationship
    with the Ministry of Defense in Iraq and yet an operational
    assignment to the coalition military commander.
        Now, this requires that we build a chain of command that
    goes all the way from the lowest Iraqi private to the Ministry
    of Defense, and the Ministry of Defense does not exist yet. But
    I believe that we will also have joint coordination cells in
    localities throughout Iraq where police, coalition, and Iraqi
    military officers will be together to discuss deconfliction.
        If it becomes necessary for police units to participate in
    a military operation, that will also come under the coalition
    commander.
        Senator McCain. I am more concerned about the
    decisionmaking process as to the deployment of U.S. military
    into a situation. That would be the sole judgment of the
    military commander, the U.S. military commander or the
    coalition commander. Does that mean that you would have to have
    some kind of fairly rapid decisionmaking process?
        General Abizaid. Sir, that means we will have to have very
    rapid decisionmaking.
        Senator McCain. Does that mean it would go to you?
        General Abizaid. Pardon me?
        Senator McCain. If there was an imminent situation, would
    the decision be made by you?
        General Abizaid. The commanders in the field have the
    authority to employ their forces in a wide variety of
    situations that require the use of military force.
        Senator McCain. For offensive military operations?
        General Abizaid. Offensive military operations will
    continue against terrorist entities, those forces that are
    targeting Iraqi and coalition forces, and that will continue at
    the lowest level.
        Senator McCain. This procedure has not been formalized yet?
        General Abizaid. Sir, it is not formalized other than to
    say that the multi-national force commander will retain
    operational control of all forces.
        Senator McCain. Thank you very much. Thank you, General.
    Thank you, General Jones.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator McCain.
        Senator Kennedy.
        Senator Kennedy. Welcome. Thank you very much for being
    here and for your service to the country.
        General Abizaid, I would like to just focus in the time I
    have on the High Mobility Multipurpose Wheeled Vehicle (HMMWV)
    issue. I mentioned this just before the course of the hearing.
    I talked to you on the phone last year. You were good enough to
    say, put it down in a letter, which I did, and you responded to
    me at that time in October of last year.
        At that time you said: ``The fiscal year 2004 supplemental
    request will permit the Services to rapidly resolve many of the
    equipment you mentioned, to include the procurement of up-
    armored HMMWVs.'' That was on October 20.
        Then Secretary Brownlee testified in November that the
    requirement would not be filled until the summer of 2005, a
    date we all agreed was unacceptable. Then 2 days ago Secretary
    Brownlee told us that we could meet it in July or August.
    Secretary Brownlee went out to Ohio himself and he has now
    committed to increase the production of up-armored HMMWVs from
    220 a month to 450 a month over a period of 5 months starting
    in May, and at that rate the Army will meet its current
    requirements of 4149 by July of this year instead of May 2005--
    this is what he has told me--as he testified in November.
        Because he is concerned the requirement will keep rising--
    and you are aware that over the period of time that the
    Department has testified the numbers or the increase has been
    continuing to rise--he has told the companies to continue the
    production rate of 450 a month indefinitely. He has paid for
    part of this increase with an internal Army reprogramming and
    asked OSD Comptroller for the additional funds.
        He has also increased the production of steel and ballistic
    glass kits to protect the soft-skinned HMMWVs, and he hopes to
    have 6,000 of these units installed in Iraq by July or August.
    So he has set an internal deadline--we have heard it was going
    to be much later--in order to spur the Army to get it done
    faster. He said they are also cutting steel into blister
    protection for HMMWVs in Iraq.
        Now, this is enormously impressive. Then Dov Zakheim
    testifies at the Defense Appropriations Committee that he is
    not on that schedule and he says that they will not have the
    funding to do this as rapidly because they do not have the
    funds to do it, so they will not be able to meet that
    requirement until October.
        Will you review that and find out why in the world we do
    not have those funds to do it? We lost 10; a third of the young
    men from my State have been killed in these kinds of incidents
    with light-skinned HMMWVs. The parents, all of them, have
    talked to me about this. I have talked both with you and
    Secretary Brownlee about it.
        We understand the technical kinds of problems about
    increasing the production, it appears, and I admire what the
    Secretary has done to try and get the rapid-fire production of
    this at as fast a production level, as necessary, and he seems
    to have done it. It would be inexcusable not to have the
    funding for that.
        There is no way that you could have known about what the
    DOD's Comptroller has said about the funding. Can you give us
    at least the assurance you will do everything you can to make
    sure, if they can get the production, that the funds will be
    there as a result of reprogramming or just asking the
    appropriating committees to get the funding for it?
        General Abizaid. Senator, we certainly favor moving as
    quickly as we can to get up-armored HMMWVs to the requirement
    level that has been established by the Army, and we also favor
    the interim fix with regard to the kits moving in as quickly as
    possible. For us, of course, as a combatant commander in a
    combat zone, the money is not the issue. I understand it may be
    for, and it certainly is for, the Department. But I have had
    nothing but support from the Secretary to do this as fast as
    possible and also from our fellow combatant commanders, such as
    General Jim Jones sitting next to me right here today.
        We have moved his up-armored HMMWVs out of his theater and
    given them to our troops. We have also taken up-armored HMMWVs
    out of the Air Force inventory and started to move them into
    CENTCOM.
        So, Senator, we certainly want to move as quickly as we can
    to ensure that our troops are well protected.
        Senator Kennedy. Well, that is fine. Now, if you would
    answer my question: Will you get the money to make sure that
    there is not going to be a deficiency in terms of funding the
    HMMWVs if they can meet the production line? That is what my
    question is, General.
        General Abizaid. Well, sir, I hope that I will get the
    money, but I do not make the money. It comes from my
    Department.
        Senator Kennedy. Well, will you let us know if you cannot
    get the money, please?
        General Abizaid. I will.
        Senator Kennedy. Thank you.
        No further questions.
        Chairman Warner. Senator Inhofe.
        Senator Inhofe. Thank you, Mr. Chairman.
        Let me just repeat what all the rest have said, that you
    two are the right people at the right time, and we are so
    eternally grateful for the work that you do. I want to thank
    you also, General Abizaid, for responding to my request in
    coming and making that excellent presentation at the National
    Prayer Breakfast. You were the right person to do that and I
    appreciate it very much.
        Along the same line that Senator Kennedy was talking about,
    we do hear from families of deployed people, whether it is
    Guard and Reserve or regular forces, and I happened last week
    to be out in California and saw some new technology I think you
    may be familiar with. One is called Close-In Countermeasures
    (CICM), which is a way of intercepting a rocket-propelled
    grenade (RPG) after it is deployed. Now, this is mounted on an
    armored vehicle. It can be on any, I suppose a tank or anything
    else.
        The second one is the Active Protective System, which does
    the same thing, intercepting the same way as a missile defense
    system does missiles that are coming towards the--and actually
    I saw videos of how they work.
        It seems like most of the casualties we have are a result
    of the incoming small missiles or RPGs. Are you familiar with
    those systems and what would be your recommendation in getting
    into that type of defense system?
        General Abizaid. Sir, I am familiar with both of the
    systems. I have yet to see the final testing reports that have
    come out of the Department of the Army that is looking very
    closely at them. We have an Improvised Explosive Device (IED)
    Task Force that is at the DOD level, within the Department of
    the Army. The Air Force has one also, and it comes together in
    CJTF-7 in Iraq.
        We are looking at all these technologies and any promising
    technology we will ask to bring into the field.
        Senator Inhofe. I think we are going to make a request that
    they look at these two specific technologies. I think it is
    very significant and very impressive, what they have done.
        First of all, let me just say that the way the whole thing
    has been executed has been just beyond our expectations. I know
    there is a lot of criticism in going into Iraq and now we have
    the definite connection between Saddam Hussein and the tragedy
    here in this country, the fact that his intelligence officers
    met repeatedly with bin Laden before this came about, that his
    top explosives guy, Salem al-Ahmed, I think it is, actually met
    with them prior to September 11. This Shakir helped gain the
    passports for two of the pilots that went into the World Trade
    Center. He also was involved in the U.S.S. Cole.
        Now, in addition to that, there has been a recent
    interception of a CDROM with 17 pages confirming this. So I
    think that our actions were the right actions and we are doing
    a great job over there.
        I think I would specifically say to you, General Abizaid,
    during the time that we were talking about your taking this
    position, you are unique. You have the ethnic background, the
    culture, and the knowledge. You know more about the way people
    in the Middle East think than probably anyone who is in uniform
    today. So I compliment you for that.
        Having said that, there are those who are suggesting that
    we abandon the war, bring the troops home, and negotiate with
    the terrorists. Drawing from your background in the Middle
    East, how do you respond to that suggestion?
        General Abizaid. Sir, I think that one of the most
    important things the United States of America must accomplish
    in the foreseeable future is bringing stability to Iraq and
    allowing a moderate government that is representative of the
    Iraqi people to emerge there. It is so important that the
    extremists not gain the upper hand in Iraq. Whatever the
    arguments may have been before, it is a battle in Iraq now
    between extremists and moderates, and the vast majority of the
    people want the moderates to be victorious. They want to live a
    better life. They want to have a chance to have a say in their
    future.
        If we allow the extremists to win in Iraq, I am afraid that
    we are in for a very tough time, not only there but throughout
    the world.
        Senator Inhofe. I would assume that by abandoning it and
    bringing the troops home and trying to negotiate with
    terrorists it would allow the extremists to----
        General Abizaid. That is my opinion. We should not leave
    until the Iraqis are ready to take control, not only of their
    government, but of their security.
        Senator Inhofe. Thank you very much.
        General Jones, one of the things that you and I have talked
    about several times is this--and yet it does not seem to get
    much attention--is a better way to spend our money on our
    forward-deployed troops. We have some 40,000 families in
    Western Europe now. I took the time to go over--in fact, I will
    ask our chairman if I can be kind of the point person in
    bringing this about. I took the time to go to Romania, Ukraine,
    Bulgaria, and other places over there.
        A problem we have that we are all sensitive to in Eastern
    Europe is that we are becoming more and more restricted every
    day. A lot of it is environmental encroachments on our training
    ranges. Then of course the expense of keeping families over
    there and having the housing and having everything that is
    necessary to support that type of thing.
        The concept of changing these 2- or 3-year deployments with
    families to perhaps 2- or 3-month deployments, keeping the
    families stateside, and going over and--believe me, I do not
    have to tell you this, but I will share this with my fellow
    members of this committee. I have never seen groups wanting us
    more and saying, we will not have restrictions, you can train,
    you can use live fire any hour, 7 days a week. Consequently,
    with the great training resources they have in the countries
    that I saw personally, I think that is going to be something
    that we should move up at a more rapid rate.
        I have talked to Secretary Doug Feith about this. He is
    kind of doing that end of it. Do you have any comments, General
    Jones, as to our progress, and as to the desirability of that
    program, the restructuring?
        General Jones. Thank you, Senator. This is an important
    moment in time and it is important that we get this right. It
    is important that we explain to our friends and allies as we
    implement a realignment of forces that we are attempting to do
    more and not less. I think that the plan we have proposed will
    do that. It will make us strategically more effective, more
    agile. We will have access to training areas in the eastern
    part of Europe, where we are welcome, where there are wider
    open spaces, where urbanization has not come up to the front
    doors and the front gates of our bases, as they have in the
    western part of Europe. Obviously, you and I have talked for
    many months about the similar problems in the United States.
    This is a problem of urbanization and base locations.
        So we have spent a lot of time in EUCOM going all over not
    only Eastern Europe, but also parts of Africa, where the
    welcome mat for a presence of some type with U.S. forces and
    engagement is out, and there are open spaces where we can
    actually train the joint force in the manner in which we need
    to have it trained so that it can do the things that we would
    expect it to do.
        It has the ancillary benefit of strategically reaching out
    to new friends, new allies, becoming more interoperable in the
    alliance, and helping the security concerns of our friends and
    allies come to fruition in a very cohesive way. It is not all
    that important that every country has its own army, navy, and
    air force. To an alliance like NATO there are many specialized
    contributions that smaller nations can make.
        The example of the Czech Republic, which decided and
    determined that they could contribute a chemical, biological,
    radiological, nuclear (CBRN) battalion and did so--state-of-
    the-art, at considerable expense, available for NATO, because
    they accept Article V of NATO, which means that they expect
    that they will be defended if they are attacked, and they will
    be. So they are willing to contribute special capabilities that
    are in short supply in the alliance.
        So it is a very powerful movement. From the United States'
    standpoint it is an opportunity to expand our presence. You are
    aware of the impact of the Georgia Train and Equip Program,
    where if we stay with it for another 2 or 3 years we will have
    trained the entire army of Georgia in western values. They will
    have an NCO corps. Their young leaders will all be trained at
    our schools. This is for a very small investment.
        We are looking in EUCOM for other countries where we could
    make that similar small investment with huge payoffs and bring
    more alliance capability and obviously provide more training
    areas for our forces.
        The future basing concepts of the proposal have more to do
    with strategic effect than occupation in the traditional 20th
    century theory. The family of bases we propose are bases that
    are in the main already built; second, with small improvements
    can come up to a certain standard; and have a very flexible
    capability from a usability standpoint. In other words, we
    could use it for 6 months, then turn off the lights and go to
    another base if we need to. It could be to respond to crisis or
    to training.
        The network effect both to the east and to the south in
    Africa and the potential of that effect is truly very
    impressive and we are looking forward to it.
        Senator Inhofe. Thank you very much.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator Inhofe.
        Senator Reed.
        Senator Reed. Thank you very much, Mr. Chairman.
        Thank you, gentlemen, for your service to the Nation, which
    begins and ends with the profound appreciation of the service
    and sacrifice of the young Americans you lead, and I thank you
    for that, too.
        General Abizaid and General Jones, you depend in your areas
    of operation on Army forces significantly. General Schoomaker
    was here a few weeks ago and said that at the current burn rate
    of spending on Iraq and Afghanistan he would be out of funds by
    October 1 unless there was a supplemental appropriation.
        Secretary Brownlee this past Tuesday has miraculously
    extended that to the spring of 2005. Now, we have heard your
    discussion of Senator Kennedy's questions of shortfalls in
    HMMWV production and gaps between the money he has committed
    and the money he has from the Secretary of Defense. I would
    like your observations and perceptions about the situation of
    when we will run out of money in Iraq and Afghanistan at the
    current expenditure rate? General Abizaid?
        General Abizaid. General Jones, are you sure you do not
    want to take that one?
        General Jones. Sir, those service chiefs cannot be relied
    upon.
        Senator Reed. Until they get promoted to be a combatant
    commander.
        General Jones. Exactly right.
        General Abizaid. Senator Reed, I think all of us know that
    we have to have what we have to have in order to fight the war
    in Afghanistan and in Iraq. I know that the Army may be
    experiencing difficulty in trying to figure out where they are
    going to meet all their operations and maintenance (O&M)
    requirements, but I also understand that that may not be the
    case for the Navy, it might not be the case for DOD agencies,
    et cetera. So I do not know the answer to the question whether
    or not there is a problem Defense-wide.
        But I do know that we have the complete commitment of the
    Secretary of Defense to spend what we need to spend to fight
    the war.
        Senator Reed. Well, there are no funds, as I understand it,
    in the President's budget for operations in Iraq and
    Afghanistan. You have the Chief of Staff of the Army, the
    Commandant of the Marine Corps, and the Chief of Staff of the
    Air Force saying they are going to run out of funds by October
    1. They have not communicated those concerns to you or you have
    not been able to communicate with them your concerns?
        General Abizaid. I am not concerned about running out of
    money to fight the war, Senator.
        Senator Reed. Does that mean that you think there will be a
    supplemental appropriation?
        General Abizaid. I do not know whether there will be one or
    not. That is a departmental issue for the Secretary.
        Senator Reed. General Abizaid, you indicated the strategy
    has changed somewhat. The targets now are civilians and perhaps
    the ultimate goal is to foment a civil uprising that will make
    our position untenable there. A key to our response there is
    the Iraqi security forces. I understand that General Eikenberry
    has conducted a survey of those security forces. Is that survey
    complete?
        General Abizaid. Yes, sir, that survey is complete.
        Senator Reed. Can we get a copy of that survey?
        General Abizaid. I believe so, sir. There should be no
    reason not to provide you with a copy. I will have to discuss
    that with the Secretary and I will do so tomorrow.
        Senator Reed. Can you share with us the conclusions? Is
    there adequate funding, adequate training? When will they be
    capable of stepping up to a role and relieving us of some of
    our roles?
        General Abizaid. I think that the Eikenberry Report is an
    important report about the adequacy of Iraqi security forces,
    the composition, et cetera. But I think it is also important to
    note that I do not agree with all the conclusions that were
    contained in there. What is key to us is that we continue to
    build Iraqi national military capacity for the New Iraqi Army
    (NIA), continue to build the militia units that are working for
    the Iraqi military, that are called ICDC units.
        We are in the process now of fielding 36 of those
    battalions. Clearly, there has been a requirement to speed the
    equipment that is being issued to the police, to obtain the
    contracts necessary to get the right things to the right police
    stations that are most under threat, and also to increase the
    quality and the capacity of training in third party states such
    as Jordan that will help increase the capacity of Iraqi police.
        Until recently, most of that police training was
    coordinated primarily through the capabilities of the CPA, but
    now we are shifting some of that responsibility, and I think
    rightfully so, to General Sanchez in Iraq.
        The most important thing to me, Senator, is that we build a
    quality Iraqi force that is capable of withstanding the
    pressures that the insurgents and the terrorists will place
    upon it and that will be loyal to the Iraqi transitional
    government and eventually the Iraqi independent government. I
    think that this quality requires us to curb our appetite about
    numbers to a certain extent and it also requires us to build
    Iraqi chains of command all the way from the lowest private to
    the Ministry of Defense, and that needs to be work that has to
    be accomplished, I think, by the 1st of July.
        That will require not only building these chains of
    command, but officering it with people that will be loyal to
    the government. I believe that the points that I mentioned are
    generally consistent with the Eikenberry Report, with the
    exception of his belief that we should decrease the speed at
    which the NIA is fielded in order to speed the ICDC units'
    development, and I do not agree with that nor does General
    Sanchez, and we have conveyed that to the Department.
        Senator Reed. My time has expired. But you are looking at a
    July 1 completion date of a daunting task, not just technical
    training, but changing in fact the orientation, the attitudes,
    the cultural perspective in some cases, of these individuals.
    That seems to me an extraordinarily daunting challenge within
    the next several months.
        General Abizaid. Well, Senator, I do not believe that we
    will have completed the task by July 1, and I did not mean to
    give you that impression. We will be in the midst of this task
    for some time. I think really the most important thing that we
    will do with the Iraqi Armed Forces and the Iraqi security
    establishment is inculcating in them the idea of civil control
    of the military and respect for their own population. This is a
    cultural change that has to take place if a moderate state is
    to emerge and it will certainly not be accomplished by July 1.
        Senator Reed. Thank you very much.
        Chairman Warner. Thank you very much, Senator.
        Senator Collins.
        Senator Collins. Thank you very much, Mr. Chairman.
        General Abizaid, General Jones, let me begin by joining my
    colleagues in applauding your outstanding service. Both of you
    are truly extraordinary leaders and we are very grateful for
    your services. So I thank you for that.
        General Abizaid, a key part of our strategy in Iraq is to
    place more responsibility for security on the Iraqi police
    force and the NIA. You have mentioned this morning that
    insurgents are increasingly targeting Iraqi security forces for
    attacks. A recent New York Times piece cited a recent attack on
    an Iraqi police station, I think it was in Fallujah, as
    revealing two very serious problems.
        One is that the Iraqi forces had insufficient weapons,
    communications equipment, and ammunition. Second, some of the
    attackers who were captured turned out to be members of the
    ICDC.
        First, do you agree that there is a problem with the
    training and the adequacy of equipment for the new Iraqi
    security forces? Second, are you seeing a significant effort by
    insurgents to join the police and the army and how are we
    trying to screen out those individuals?
        General Abizaid. Senator, with regard to the first question
    about how have we done with regard to training and equipment
    and is it adequate at the present time, in some areas it
    certainly is not. Having personally been to the location that
    you are talking about in Fallujah, I would say that those
    forces there are not adequately trained or equipped, we have to
    get the equipment to them, and we have to speed it to them and
    we have to enhance their training. We will do this by doing
    more mentoring with U.S. forces and working directly with Iraqi
    units, especially ICDC units.
        I would also ask you to remember that in May we started out
    at zero and it is not even a year since May and we are up to
    200,000. Inevitably, to go from nothing to this level there
    will be various degrees of success in some geographical areas
    versus others. Of course, in those areas where there has been
    the most resistance, such as Fallujah, Ar Ramadi, Baqubah,
    Samarra, and others, it has been necessary on occasion to start
    again from zero.
        So for example, we fielded a police force in Fallujah once.
    We had to bring it back down nearly to zero again in order to
    get it right, and getting it right is as much about equipment
    as it is about attitude and the willingness to serve and a
    willingness to do your duty.
        With regard to your second question, there is no doubt that
    terrorists and insurgents will attempt to infiltrate the
    security forces, and we know it is happening and we know it has
    happened. We attempt to do our best with regard to vetting
    people. We certainly rely very much on Iraqis that will tell us
    how to regard certain people, a certain person who is applying
    for service, and we have more stringent vetting authority as
    you go up the chain of command for officers, for example.
        That having been said, particularly in the areas where the
    extremists are heavily embedded, it is difficult to sort
    through tribal loyalties, familial loyalties, ethnic loyalties,
    loyalties to the former regime, et cetera. I also believe,
    however, that in every instance the number of people that are
    coming forward to serve in the new Iraqi security services and
    the number of people that are currently serving there are
    overwhelmingly supportive, positive, and determined to make the
    new Iraq succeed.
        So I think we will have to continue to be vigilant, just
    like in the building of any new enterprise, and ultimately over
    time the Iraqi security forces will assume more and more
    responsibility. I think there is a misreading in the press that
    somehow or other we are leaving them out there to their own
    devices, which is certainly not our intent. The fact that we
    have doubled our number of SOF in the country to operate
    directly with Iraqi battalions, for example, is evidence of our
    desire to help them help themselves.
        But ultimately, Senator, the key to success is Iraqis being
    in charge of their own security as well as their own
    government.
        Senator Collins. I agree.
        My second question has to do with the stockpiles of weapons
    and ammunition that our troops are repeatedly finding. Indeed,
    they have been very effective in uncovering these caches of
    weapons and ammunition. Could you tell us if you believe that
    most of these weapons stockpiles appear to be left over from
    the Iraqi regime, or is there evidence that these are new
    caches of weapons and ammunition brought in by foreign
    terrorists?
        General Abizaid. Senator, that is a great question. It is
    my clear opinion that the majority of the weapons, ammunition,
    and other military paraphernalia that are found in Iraq are
    left over from the previous regime. No doubt that there is a
    small amount of weapons and explosives that may be coming
    across the border, but we actually find that most of the
    foreign fighters infiltrate on either falsified documents or
    good documents that get them past routine security checkpoints,
    and then they go to safe houses within Iraq and become armed.
    That is primarily from the arms and ammunition that are left
    over from the old regime.
        I am amazed every day by how much we find. I cannot tell
    you where the bottom of the barrel is. We are making some
    strides in it, I know that because the price of certain weapons
    on the street has gone up.
        Senator Collins. Thank you.
        Chairman Warner. Thank you very much, Senator.
        Senator Akaka.
        Senator Akaka. Thank you very much, Mr. Chairman.
        General Jones, I want to express to you and General Abizaid
    how proud I am and we are of our troops and what you are doing
    in Iraq and in Europe. My question is a follow-up on a question
    that was mentioned by Senator Inhofe on basing in Europe. I
    understand that part of the plan is to make additional use of
    ranges in East European countries. Since I have been to Poland
    and visited one of them, I am curious about ranges in other
    countries.
        Has either your staff or the OSD done any analysis of any
    upgrades in land or instrumentation that would be needed to
    create a more robust training environment for new ranges in
    Eastern Europe?
        General Jones. Senator, we have extensively. We have, prior
    to putting our proposals together as to where our forces might
    be able to go train and interoperate, made a survey of all
    available ranges. East European nations, to include Poland,
    were very forthcoming, particularly the seven new NATO members.
    So we have a very good site picture of what is available and
    what we might wish to do to enhance some of those ranges.
        But generally they bring the scarcest quality in Western
    Europe and that is simply space--air space, ground space, in
    some cases sea space. It is not limited to Eastern Europe. We
    have also done extensive inventories in North Africa. For
    example, Morocco has made extraordinarily generous offers of
    access to their bases. Senator Inhofe would be very pleased
    during the debate that we had on Vieques if we would be able
    to, as we have now, look at the ranges in Morocco where they
    are more than happy to have us come and train in the totality
    of a naval expeditionary force in whatever way we wish to,
    within certain limitations of course, but certainly
    satisfactory.
        It is a very exciting opportunity. So the good news is a
    lot of those bases already exist and the level of
    infrastructure that we would have to add could be borne by NATO
    nations, could be borne bilaterally. It does not have to all be
    borne by the United States.
        Senator Akaka. Thank you.
        General Abizaid, we have had multiple Army witnesses
    testify in the last month and they expressed their concern
    about the rate at which we are expending our funds for
    operations in your theater. That was touched on by Senator
    Reed. But I want to be a little more specific on that. Again, I
    repeat that they expect to have significant difficulties making
    it to the end of the fiscal year.
        One of the main drivers for high costs--and this is where I
    want to be specific--is logistics support contracts. The Army
    reports that it has recently issued guidance directing its
    units not to spend additional money on these contracts, but
    that combatant command decisions can override such guidance.
        My question is, what is your understanding of the costs
    associated with the logistics support contracts, and what
    efforts are you making to try to keep these costs down?
        General Abizaid. Well, Senator, the logistics contracts
    that the Army enters into are their contracts. They also enter
    into them as the executive agent to the Coalition Provisional
    Authority (CPA). I have no doubt that logistics costs are high.
    They are high because you have to pay a lot for insurance for
    people to conduct--for civilians to conduct operations in an
    area that is obviously dangerous, and they are high because of
    the lines of communication and the amount of equipment that has
    to be moved.
        While I appreciate the difficulties that the Army has in
    meeting their obligations, it is also paramount to me that our
    operational requirements be met, and the operational
    requirements are constantly changing as we reposition the force
    to deal with the emerging enemy threat. When we do this, it is
    done for reasons that are expensive to the Army as a Title 10
    authority, but are essential to the commander, General Sanchez,
    in order to get his forces in the right place and at the right
    time.
        There is no doubt that the movement of some of our bases
    from key urban areas to more important military locations costs
    a lot of money. Yet we consider that to be operationally
    essential. I can assure you, Senator, that both General Sanchez
    and I are mindful of the costs associated with the Logistics
    Civil Augmentation Program (LOGCAP). We agree with the Army's
    requirement on its subordinate units to cause those costs to be
    as reasonable as possible.
        But on the other hand, we also make it very clear to the
    Army that we have to fight this war the way the commanders on
    the ground need it to be fought.
        Senator Akaka. So there is no misunderstanding, we want our
    forces to have all they need and at whatever costs. But
    whatever way we can help in trying to spend wisely is what we
    are looking at. We hope that we can continue to do this.
        General Abizaid. I agree with that, Senator.
        Senator Akaka. General Jones and General Abizaid, the Navy
    is implementing a new operating concept called the First
    Response Plan (FRP). The Navy claims that they will be able to
    provide more readiness for less money under this plan, which
    also involves providing less habitual presence overseas but
    more surge capability to meet the combatant commanders' needs.
        What are your views of the Navy's plan and the changes in
    how the Navy plans to provide presence in your theaters?
    General Jones?
        General Jones. Thank you, Senator. I have a certain amount
    of passion for maritime questions and the value of naval
    presence, so I have been involved with many discussions from a
    unified commander's perspective with the Commandant of the
    Marine Corps and the Chief of Naval Operations (CNO) on this
    issue.
        I think that the value of forward presence is beyond
    question and it is very important to the future of our Nation,
    not only to fight and win wars, but hopefully to also prevent
    wars and to do those things in the interregnum to prevent
    conflicts and to do so by very focused and active engagement.
        In the 93 countries that I am responsible for, I see an
    increasing demand for forces, naval forces in particular, along
    the west coast of Africa in the future. In the past we have
    generally limited ourselves to naval expeditionary forces
    coming through Gibraltar, spending time in the Mediterranean,
    and in the case of helping CENTCOM flowing those forces from
    Europe, either maritime forces or land-based forces, to the
    CENTCOM region for operations.
        When those demands lighten up, and I am confident that they
    will in due time, we will go back to the business of how we
    want to shape and how we want to engage. I think it would be a
    mistake to relegate naval forces to a crisis response type
    force only, in other words, that you only use them when you
    have a crisis. I do not think that is the CNO's intent, but I
    think we can make a more intellectual and far-reaching judgment
    as to how those forces should be deployed to do those things
    that do not have necessarily much to do with a crisis but to do
    with influencing the areas of operations to preclude crises.
    You do that through focused engagement.
        I think that maritime forces will be useful in the
    Mediterranean, but also useful in a newer context along the
    west coast of Africa as this continent struggles to find its
    place among the developing areas of the world that we should be
    concerned about.
        I think it is interesting to note that in the NATO Response
    Force that is developing, there is a strong maritime component
    that will also have the ability to sail proactively to those
    areas that we wish to engage in, to help other nations defend
    themselves, to develop their security plans, and to reap the
    benefits that a nation of great influence can bring to
    stabilize entire regions before they become a crisis.
        So with that caveat, I would say I support the concept. It
    will be a better utilization of forces, but I would emphasize
    that it is for crisis response, but it also is for very focused
    work to prevent crisis.
        General Abizaid. Senator, I also support the concept. The
    presence of naval forces in the CENTCOM area of operations
    gives us added air power. It gives us great flexibility for
    intercepting terrorist maritime activities. Our maritime
    interdiction operations have been successful in a number of
    cases as a result of the maritime presence in the region and
    certainly the ability to move shipboard forces represented by
    the Marine Corps into Iraq and out of Iraq and into Afghanistan
    and out of Afghanistan has given me a flexibility as a theater
    commander that is absolutely important to me.
        I do not think, however, it is necessary for us to always
    have a 100 percent carrier battle group in the region or an
    Amphibious Ready Group (ARG) or MEU in the region. We can work
    these things, especially when the adjoining combatant
    commander, such as General Abizaid, is more than willing to
    help us out if the situation starts to deteriorate in the
    theater, and I am willing to do the same thing for him.
        So we know that the assets are not available to do
    everything that everybody wants to do, and I think what the
    Navy has come up with is a plan that we can certainly live
    with.
        Senator Akaka. Thank you very much for your responses.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator Akaka.
        Senator Roberts.
        Senator Roberts. Thank you, Mr. Chairman.
        Let me join my colleagues in praising you both for your
    perseverance, your performance, and your resolve. I think we
    all say that. I note we also ask you questions that you cannot
    answer. Namely, I do not think any combatant commander can
    respond or control, for that matter, any decision by the DOD
    Comptroller, decisions on funding. But we sure as hell can.
        In that regard, General Abizaid, I appreciate your
    assurance that you will continue to provide us a straight-
    shooting candor type of advice and counsel. That also goes for
    General Jones, who has done that in the past. As a matter of
    fact, if I could think of two individuals that I would like to
    have by my side or on either side if it was high noon in Dodge
    City and we were on Front Street, you would be the two I would
    pick. As a matter of fact, I would just go back to the Long
    Branch and let you take care of the black hats and that would
    be that.
        Let me say that we had a subcommittee hearing yesterday in
    the Emerging Threats Subcommittee. Senator Reed is the ranking
    member, I am the chairman. The issue of HMMWV protection did
    come up, as it should, and I think my numbers are correct in
    regards to the HMMWV kits, which were on display, in terms of
    1300 being in theater, 3,000 on the way, and the need would be
    11,000 in addition to the improved vehicles. So we are making
    some progress.
        I was also interested in a different vehicle that was
    talked about there in our science and technology (S&T) hearing,
    and also trying to get 3 percent of the DOD budget still
    committed to S&T so that we can have the technology to do the
    kinds of things that you want to do and to maintain our
    superiority. I think that vehicle is called the Water Buffalo.
    I am not sure, but at any rate there will be another vehicle on
    the way down the road if the tests prove adequate.
        I was also interested to know or to find out, General
    Abizaid, that basically any time there is an attack by an
    explosive device it goes to that center you described in regard
    to Baghdad, but then also goes to Quantico, which I did not
    know, and then from Quantico back to the S&T community with Dr.
    Sega, who is our defense research head within the DOD, and the
    military commanders who testified before us at the Emerging
    Threats and Capabilities Subcommittee.
        I do not know if we need to institutionalize this a little
    bit in regards to legislative action or not. But at least in
    terms of what is happening in Iraq and how things change and
    how we need better force protection and to assist our troops
    and the warfighter, I think we are making some progress, and I
    wanted to make sure that everybody was aware of that chain of
    information and the rapid reaction time that we now can get
    what we need, either off-the-shelf or what the Defense Advanced
    Research Projects Agency (DARPA) has in line.
        I am making a speech as opposed to asking questions, but I
    think it is important. As chairman of the Intelligence
    Committee, we are taking a look at the prewar intelligence on
    postwar Iraq. You have spoken in great detail, General Abizaid,
    about the ever-changing climate and the challenges that you
    face. We have the largest station in the world in regards to
    the Central Intelligence Agency (CIA) in Baghdad. We have had
    some startup problems. There was an article in the press today
    that sort of summarized all of that in regards to turnover and
    stress and strain and some other problems that we will go into
    in the Intelligence Committee.
        Can you comment in regards to not only the value, but your
    judgment as to the efficacy of the intelligence that you are
    receiving now? More especially with these attacks on religious
    sites and how you have described the situation with the Shias
    and the people who are trying to either produce a civil war or
    even greater instability.
        General Abizaid. Thank you, Senator Roberts. The single
    most important thing to General Sanchez in Iraq is having good
    intelligence. With good intelligence you can get precise
    targeting. With precise targeting you can start to unravel the
    enemy cells.
        As you recall, back in the September-October period when it
    was clear that the insurgency was spreading, it became obvious
    to us that we really need to fuse the intelligence system and
    improve it and ensure that the wonderful intelligence that was
    being developed at the tactical level made it all the way up to
    the operational level, so that we could make the battle one of
    the entire force versus just platoons and squads that were out
    there operating in their own individual areas. I think, largely
    with the help of our various intelligence agencies, with
    wonderful work by my J-2, John Custer, and General Sanchez's J-
    2, Barbara Fast, we managed to get an intelligence system
    working that has given us great insight against the insurgents
    and has allowed us to unravel their organizations in a way
    that, I think, will be viewed as a model when people have a
    chance to look at it.
        Now, this does not mean that the enemy does not adjust
    their tactics, because they do. They are adjusting their
    tactics. They are adjusting the way that they conduct their own
    operational security. You can see by the letter from Zarqawi,
    for example, how concerned he was about how many eyes were out
    there and how dangerous the operation was. But this war is a
    war of intelligence and perception, and it is just so important
    that the intelligence part of the battle be adequately
    organized and that we think out of the box about who is doing
    what and not worry about turf.
        I am happy to report to you that I think that the
    relationship that has developed in Baghdad with the CIA and
    CENTCOM has been one that has allowed us to get at this problem
    in an important way.
        However, I would like to say one thing if I may, Senator,
    because I know it is so important to you. We do not have enough
    intelligence professionals in our Nation. We must increase our
    human intelligence (HUMINT) capacity. We must increase our
    ability to have translators and interrogators in the field. To
    me, as we fight this global war on terrorism, if we do not do
    that, we are putting the Nation at risk.
        Senator Roberts. I can assure you the Intelligence
    Committees on both sides, both the House and Senate, are aware
    of that and we are trying to address that on an emergency
    basis.
        I have just one real quick question. My time has expired,
    but that does not seem to bother anybody here. General Jones,
    why could we not have or what would be the value of an
    integrated intelligence center? I do not think I am describing
    that right, but those are the words that I am using. You are
    going from 19 to 26 countries. You have those kinds of things
    in operation now. We really have to rely on better
    intelligence. When we expanded NATO before, we were worried
    about vetting certain people. If we are actually going to be a
    viable force like we are in Afghanistan and perhaps in Africa,
    et cetera, we have to have better intelligence.
        Is there any value in having some kind of an integrated
    intelligence center? Would that be a help?
        General Jones. Senator, I think it would be an enormous
    help. One of the critical shortfalls in NATO's capability is
    fused intelligence. Intelligence is still very much a national
    responsibility and we have not really broken through to the
    extent that we should the sense of sharing of intelligence in
    depth.
        What we are working on in Europe is looking to see if we
    can come up with a plan to collocate in the U.S. Joint Analysis
    Center in Molesworth, England, and perhaps also develop a NATO
    intelligence center right next to it. That would begin to
    bridge this gap and compensate for the shortfall. I think it
    needs to be done.
        Senator Roberts. Mr. Chairman, my apologies to Senator
    Nelson, whose time I have taken, maybe 2 or 3 minutes. So I owe
    you. I do not know how I am going to pay you, but I owe you.
        Chairman Warner. Before we move on, I think that, Senator
    Roberts, you ought to take note of the comment made by General
    Jones about the Joint Analysis Center. I think it is a very
    good idea.
        Senator Roberts. Mr. Chairman, we have talked about it. As
    a matter of fact, we talked about it in London when you were
    there, sir, about the possibility of that.
        Chairman Warner. I remember that.
        Senator Roberts. I think it is an excellent idea. So we are
    not just going to take it under consideration; we are going to
    see if we can move that.
        General Jones. Thank you, sir.
        Chairman Warner. That is something the North Atlantic
    Council (NAC) has addressed?
        General Jones. Sir, it is in the embryonic stages. In my
    U.S. hat, I have asked EUCOM to develop a plan whereby--that
    would show how this could be achieved, and then we will propose
    it to the nations and see if they accept.
        Chairman Warner. Well, I would hope they do, because I
    think we could get some very strong support and a little money
    for that back here.
        General Jones. Thank you, sir.
        Chairman Warner. Thank you.
        Senator Nelson.
        Senator Ben Nelson. Thank you very much, Mr. Chairman.
        Let me add my appreciation to both of you and to the men
    and women in service who are protecting us in so many places
    around the world. Thank you all.
        General Abizaid, as you indicated, in terms of building up
    an emerging Iraqi security capacity, numbers are not
    necessarily what we ought to focus on that ought to be adequate
    to deal with the challenge. Last September you said, ``While
    Iraqi police capacity still remains below requirements, joint
    coalition and Iraqi police operations are bringing to justice
    criminal gangs that have been preying on the Iraqi people.''
        Having said all of that, is there a time frame that we
    might look toward when we can say that it is not below the
    requirements, that we are actually meeting the requirements?
    Because it is an integral part of turning over the control to
    the Iraqi government, once it is duly elected and appropriately
    installed.
        General Abizaid. Senator, by September we will have met the
    numerical requirements by and large, and we are, of course,
    always evaluating the size of the NIA, the size of the ICDC,
    police, et cetera. We certainly know, for example, that our
    original target numbers for the Iraqi Border Service were not
    adequate, and we will have to increase that number.
        But, by September, the numbers will largely be met. What is
    difficult for me to tell you is when they will be good enough
    to assume partial responsibility, full responsibility, et
    cetera. Already, in parts of the country, such as up in the
    north and down in the south in the Basra area, the police
    services and the ICDC units are performing very well and they
    bear most of the responsibility, and also, to a certain extent
    in key parts of Baghdad. ICDC units and police corps units in
    many parts of the country lead operations against terrorists
    and insurgent cells, and they do so very well.
        But the key part that is missing now, Senator, is this
    Iraqi chain of command that must be built. It is not good
    enough for Iraqi units to work with us and not report to a
    hierarchy that is Iraqi. Ultimately this force must be all
    Iraqi, and it must be under their command and control and their
    complete ability to use it in a way that will not only solve
    the internal problems that they face, but also the external
    problems.
        Senator Ben Nelson. Will that be corrected, at least in
    part, in July by turning over the authority, or will that just
    simply be one step in the necessary progression to get that
    kind of command and control?
        General Abizaid. I believe by July 1 the command and
    control will be established. But it will be about 6 to 8 months
    after that before I would regard it as being effective.
        Senator Ben Nelson. The difference between saying somebody
    is in control and actually being in control, is that accurate?
        General Abizaid. I would say that is accurate, sir.
        Senator Ben Nelson. Thank you.
        General Jones, in connection with NATO turning over the
    mission in Bosnia to the EU, obviously the transition offers
    great opportunities for NATO and the EU. NATO will have a
    partner to hand peacekeeping responsibilities to, and the EU
    will begin to develop its own security identity.
        Wearing your NATO hat, do you see the emergence of the EU's
    military capabilities as a matter of competition to ongoing
    NATO operations?
        General Jones. Senator, I see it as complementary. Most of
    the member nations of the soon to be expanded EU are also NATO
    countries. We are showing, I think, through our daily
    interaction, through the leadership of distinguished officers
    like Admiral Feist, here present, who is the single EU
    operational officer embedded in the allied command at SHAPE,
    that the worst scenario in my opinion would be to try to create
    a separate standing force structure, a separate headquarters,
    that would all draw on the same pool of assets that are already
    somewhat limited.
        Senator Ben Nelson. Well, that could have the effect of
    draining----
        General Jones. It would have a draining effect.
        Senator Ben Nelson. Which is one of my concerns.
        General Jones. It would have a draining effect on the
    alliance, in my opinion, and it would reduce our capabilities
    overall, because the percentage of the budgets that are being
    devoted to national security across the alliance are generally
    not increasing. As a matter of fact, we are finding it very
    hard to make sure that they hold, at least at their current
    level. It would have, I think, a negative effect on the overall
    capability and significantly impact--again, putting my NATO hat
    back on--the general momentum that we have in NATO to achieve a
    NATO transformation.
        Senator Ben Nelson. Well, without intending to be
    indelicate as I say this, I must admit that I do have a concern
    with siphoning away or diminishing overall the capacity of NATO
    because of the limited resources both in Europe and here at
    home and among the NATO nations.
        General Abizaid, the Personnel Subcommittee--I am taking
    the 3 minutes that Senator Roberts stole from me--has had a
    series of personnel discussions and hearings on sexual assault
    as it relates to military operations, setting aside the other
    issues that have been raised with respect to our military
    schools.
        What are your thoughts on what impacts the actual situation
    has created with respect to troop morale? Is there an impact on
    troop morale that you have been able to detect? It cannot be
    helpful, I understand.
        General Abizaid. Sir, any time that there is a sexual
    assault within a unit it affects the effectiveness and morale
    of the unit. There is no doubt about it. Our key concern is to
    make sure that we have the mechanisms in place in a combat
    theater, which I do not currently think are adequate, to ensure
    that when sexual assaults are reported, we can look into them
    quickly. Also that a reporting mechanism for women, who may not
    feel comfortable going through the chain of command exists
    outside the chain of command.
        We have them well established here in the U.S., and we need
    to have them well established in the combat zone as well. I
    believe that any organization where ill discipline occurs
    always starts to have difficulties. One of the key things we
    are looking at is what type of units have these incidents
    happened in? Are there classes of events that have taken place?
        Certainly, Senator, when these things come to our
    attention, the chain of command moves them into the Uniform
    Code of Military Justice (UCMJ) system as quickly as they can.
    But there is room for improvement, and it is important that we
    focus on the enemy and not at one another.
        Chairman Warner. Thank you, Senator, very much.
        Senator Ben Nelson. Thank you very much, Mr. Chairman.
        Thank you, General.
        Chairman Warner. Senator Chambliss.
        Senator Chambliss. Thank you, Mr. Chairman.
        Gentlemen, let me commend you for your service to our
    country, and when you get back to your respective commands, I
    hope you will convey to the men and women serving under you the
    appreciation of this body for their service and their
    professionalism.
        General Abizaid, we are having a debate that is going to be
    ongoing for some time relative to prewar Iraqi intelligence.
    But I want to focus for a minute on what is going on right now,
    because obviously that is the heart and soul of the operation
    that you are carrying out and obviously things have gotten
    somewhat better. I know you are limited in what you can say in
    this forum, but first of all I would like to compliment you for
    the intelligence activities surrounding the capture of Saddam.
    It was truly amazing to me that you could get that
    intelligence, you could interpret it, you could analyze it, you
    could get boots on the ground as quickly as you did and carry
    out that mission. That was one of those situations where a best
    laid plan came together perfectly.
        But with respect to what is going on now, are you
    comfortable with where you are from an intelligence-gathering
    standpoint? Are you utilizing more local Iraqis on a daily
    basis than you have in the past? How reliable is the
    information that you are getting?
        General Abizaid. Senator, I certainly agree with you that
    the key to success in Afghanistan and Iraq happens to be
    effective use of intelligence. It all comes down to whether you
    can link the intelligence and the operations in a way that
    allows you to take out a target precisely.
        No, I am not satisfied. I will not be satisfied until the
    people that we have identified as enemies of this Nation are
    dealt with, and that will take some time. That requires a lot
    of hard intelligence work. But it is not just United States
    intelligence work. As you have described, it has to be
    intelligence-sharing with all other nations in the region to
    the extent possible. It has to include, in Iraq and Afghanistan
    in particular, the establishment of indigenous intelligence
    capabilities, because ultimately in Iraq it will be Iraqis that
    defeat the terrorists and the insurgency threat, and they will
    do that by good intelligence, by good police work, and by good
    operational activities.
        We are starting to see some development of that now. But I
    remain optimistic that we will develop a capability that is
    both effective and controllable by the emerging government. One
    of the things that we have to keep in mind about Iraq in
    particular is that the Iraqi Intelligence Service was much more
    pervasive, much more in control, and much more of a terrorist
    organization than any of us had ever quite understood. So,
    whatever happens, we cannot allow the old mentality of the
    Iraqi Intelligence Service to emerge in the new police
    intelligence or national intelligence services that develop
    there.
        Without going into details, I would tell you, Senator, that
    we have good intelligence that is provided by a lot of people
    in Iraq who believe in the future of their country, and they
    come forward to us and they tell us what is going on. They do
    not tell us out of a sense of reward. They tell us out of a
    sense of knowing that if we do not take care of these terrorist
    problems, there will be no future for Iraq.
        So the number of people coming in and giving us information
    is great. Our ability to shift our focus and sift through it
    properly, of course, is always something that requires a lot of
    work. That is why I come back to this absolute need for
    intelligence professionals to stay with the team, to serve in
    these theaters, and to help us organize the effort against the
    extremists.
        Senator Chambliss. Well, that is encouraging.
        General Jones, some of the countries that are under your
    jurisdiction or your command have pushed back somewhat with
    respect to sharing of information. But over the last several
    weeks and months, we have seen the terrorists attack some of
    these folks who now understand that this has to be a worldwide
    effort.
        Are you seeing any softening in any of these countries
    relative to the sharing of intelligence information with your
    command?
        General Jones. Senator, the events of 2003, particularly
    the attacks in Istanbul, had a very sobering effect throughout
    Europe, and I think that there is an increased sense of urgency
    that this global war on terrorism is really serious business.
    But Europeans have not been idle in their treatment of the
    problem. Over the past few years there have been over 9,000
    arrests of people in Europe connected with suspicions of being
    associated with terrorist organizations. So you might not hear
    about it in the headlines, but they have been very effective in
    their own way in their own countries at understanding what is
    going on, tracking the movement of not only illegal immigrants,
    but drug trafficking and the like, the things that finance
    terrorist organizations.
        So I think that there is a sense of urgency, and I think
    that we are moving closer together with regard to tearing down
    some of the historical barriers to good comprehensive sharing
    of intelligence.
        Senator Chambliss. Thank you.
        Chairman Warner. Thank you very much, Senator.
        Senator Clinton.
        Senator Clinton. Thank you, Mr. Chairman.
        I too want to thank both of you for your service and for
    your patience in being here today and answering all these
    questions.
        I am struck, General Abizaid, by the last pages of your
    testimony where you list the needs that you continue to have
    both with respect to personnel requirements as well as
    logistics support and even some legislative authority changes.
    I appreciate the specificity that you have presented here and
    we will certainly follow up on that.
        I particularly support the Commanders Emergency Response
    Program (CERP), which I saw firsthand and its effects when Jack
    Reed and I were there. Again, thank you for meeting with us
    during our time in Iraq and Afghanistan. I think getting the
    flexibility for those funding decisions down to local
    commanders made a huge difference and I am glad we were able to
    fix some of the glitches and get the money flowing again, and I
    appreciate your raising that.
        I wanted to ask for your comment on a recent news report
    that I found very interesting and somewhat troubling. It
    concerned a report by NBC News a couple of days ago that ``The
    Bush administration had several chances to wipe out Zarqawi's
    terrorist operation and perhaps kill Zarqawi himself, but never
    pulled the trigger.''
        The story goes on to report, with both on-camera sources
    and off-camera anonymous sources, that, ``In June 2002, U.S.
    officials say, intelligence officials had revealed that Zarqawi
    and members of al Qaeda had set up a weapons lab at Khoram in
    northern Iraq producing deadly ricin and cyanide. The Pentagon
    quickly drafted plans to attack the camp with cruise missiles
    and air strikes and sent it to the White House, where,
    according to U.S. Government sources, the plan was debated to
    death in the National Security Council (NSC).''
        The report also went on to say that, ``4 months later,
    intelligence showed Zarqawi was planning to use ricin in
    terrorist attacks in Europe. The Pentagon drew up a second
    strike plan and the White House again killed it.''
        General Abizaid, do you have any knowledge of this report
    or do you have any information about any opportunities we might
    have had to take Zarqawi out?
        General Abizaid. Thank you, Senator. Also, before I answer
    I just want to say thanks for your support on the CERP. You are
    absolutely correct that ammunition is money and money is
    ammunition. It really has an important impact on the troops in
    the field.
        With regard to Zarqawi, I read the report. I think we all
    know from open sources that we were always looking at this Fort
    Campbell in Khoram up in northern Iraq, which we did attack
    during the war. But the association with a particular terrorist
    at a particular point with the quality of targetable
    information I would dispute.
        I do not think--and of course I did not have full access to
    all the information at the time. But I would be very surprised
    to find out that we had a precise location on Zarqawi or Osama
    bin Laden or Zawahiri or half a dozen of these other people
    that would allow us to launch a cruise missile from afar, and I
    suspect that that portion of the report is not correct.
        Senator Clinton. Mr. Chairman, I would ask consent to
    submit to the record the transcript of the report. I do think
    it bears further investigation.
        Chairman Warner. Without objection.
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Clinton. I understand that the general may not have
    direct knowledge, but I think that we should inquire further on
    the basis of that.
        General Jones, I appreciated your report about NATO and I
    was intrigued by your reference to expanding the PFP to include
    some of the countries that may not yet have formal membership
    in NATO. I would be interested in hearing specifically which
    countries those might be, if that is possible in an open
    hearing.
        But, second, I am still bewildered by the delay that we
    have seen with respect to NATO deploying further assets in
    Afghanistan. When Senator Reed and I were there we looked for
    somebody in authority in NATO to talk to us. We could not find
    anybody. We landed at Kabul with German and Belgian troops
    obviously assigned there. But despite the fact that they took
    action under Article V, despite the fact that they came in
    early to provide military support and policing support, despite
    the fact that for months we have heard they are considering
    going in in greater numbers and working PRTs, and despite the
    fact that both Secretaries Rumsfeld and Powell were there a few
    months ago discussing this matter, we have no action.
        Can you explain in more detail, what are the problems, the
    obstacles, the resistance on the part of our NATO allies?
        General Jones. Thank you, Senator. First, the PFP Program
    is one of the singular successes of the alliance in terms of
    expanding the alliance this year to 26 nations. The seven
    countries that will become full members have actually graduated
    through this program and met the requirements for accession to
    full NATO membership.
        Universally through the corridors of Brussels and other
    NATO capitals, the PFP Program is widely regarded as being
    responsible for this happy state of events. The alliance is now
    considering what the future holds for PFP and what other
    nations might be admitted as members. It is a decision to be
    made at the political level. The options would obviously range
    from additional countries to the east, without being specific
    for obvious reasons, but we also might wish to perhaps look at
    some countries in the Mediterranean, particularly the North
    African countries, like Morocco and Algeria and others that are
    showing tremendous progress, not necessarily to be future
    members of NATO because that might be a little bit of a stretch
    for some, but to have another type of partnership program that
    would cement the southern flank of the alliance a little bit
    better than it currently is.
        So I think the encouraging news is PFP is recognized as
    being one of the key instruments of NATO. The alliance will
    consider the candidacy of several nations. There are nations in
    the Balkans that wish to be considered. Serbia has been
    interested in becoming a member of the PFP. Bosnia and
    Macedonia have been fairly vocal in wishing to join the PFP
    Program.
        It is a program that people recognize. Its intent is that
    it leads to full partnership, and Russia is also involved in a
    certain special way in the PFP. It is an extremely important
    program; and it will be interesting to watch the discussions
    and the evolution. I think it is very important that we
    continue this program.
        With regard to the speed with which NATO reacts to a
    mission in Afghanistan, there are now about 6,200 NATO troops
    located in and around Kabul, which was the original mission,
    and Germany has taken the lead in a PRT in the northern
    province of Konduz. That PRT is up and operating.
        Recently, at the informal ministerial meeting in Munich,
    Germany, ministers of defense met and we were able to propose a
    plan for expansion of NATO's footprint to include another five
    PRTs, two additional in the north and three in the west towards
    Herat. Nations are now deciding how they wish to proceed, but
    there have been offers of forces and capabilities to establish
    those PRTs.
        Admiral Feist, who I introduced to the committee earlier,
    the Deputy Supreme Allied Commander in Europe, is generating
    the force. It is my belief that within the next few months we
    will have an impressive expansion of capability. It takes time.
    It is a 26-nation alliance of sovereign nations. They are
    committed in the Mediterranean and in the Balkans. Some nations
    are committed to Iraq and also to Afghanistan.
        So, I cannot fully explain why it does not happen quicker
    except to say that there is progress, and I am encouraged with
    the direction we are taking that we will eventually get the job
    done in Afghanistan.
        The ambition, the problem that I have, is to make sure that
    the political ambition is matched by the resources required.
    Historically, that has been a problem in the alliance. We have
    to recognize that. It is beyond question that once the
    political decision is made and the force generation process
    commences, that until recently, the ability to fully resource
    the force to the military requirement stated has been something
    less than desirable. If NATO is changing, and I believe it is,
    culturally, if it wishes to be able to have a global impact and
    an expeditionary capability and go to the very dangerous places
    that General Abizaid has cognizance over in Afghanistan and
    perhaps ultimately even, who knows, maybe even in Iraq, and
    wishes to get there in time to make a difference, then it has
    to be resourced out adequately in order that we do not put
    people at risk even though they are doing security, stability,
    and reconstruction type operations.
        This is very much a transition period for NATO as it turns
    itself into the wind of the 21st century. There are many
    cultural changes that are going on simultaneously to embrace
    the new realities of the world that we live in. I think we
    should be critical at the right time. I think we should be
    encouraging and supporting because, I think, in general the
    trend is very positive.
        Thank you, ma'am.
        Chairman Warner. Thank you, Senator, for bringing up the
    concept of the PFP. I believe we are on the 10th anniversary.
    It started under the administration of President Clinton, and I
    remember very well being in the North Atlantic Council (NAC)
    conference the day that Russia walked in. It was quite a
    memorable day. I was in Secretary of Defense Cohen's party that
    day, and it has worked well. I thank you for your strong
    endorsement of that program, General Jones.
        Senator Sessions.
        Senator Sessions. Thank you, Mr. Chairman.
        General Abizaid, we want to thank you for the tremendous
    work you are doing, the incredible hours you and your staff and
    soldiers are giving every day in a dangerous situation to
    protect the legitimate interests of the United States and help
    create a new Iraq that will be a country that people can live
    in safely and progress economically and have freedom to choose
    their futures, to help women have a better chance to succeed.
    It is a dangerous area, but you are doing it with great skill
    and I am very appreciative.
        General Jones, thank you for your leadership. Growing up in
    Europe as you did, you have the unique perspective and ability
    to communicate there. I hear nothing but good reports on your
    leadership. I know you are winning respect from the European
    military leaders and other leaders. That is very important to
    us.
        General Jones, with regard to NATO and the questions
    Senator Clinton asked about their involvement in Afghanistan
    first, tell me how big a decision that was for NATO to agree to
    take a leadership role in Afghanistan, and how do you rate that
    as part of the relationship we have with NATO?
        General Jones. Senator, I think that this was a very good
    decision. I think one of the most important events that
    happened in the near past with regard to the future of NATO is
    the Prague Summit of 2002, which came out with very clear
    guidance for whoever happens to be the operational commander,
    very clear guidance as to how the alliance wished to proceed
    and be perceived in the future.
        It demanded the creation of the NATO Response Force and
    within the NATO Response Force it stipulated that it would have
    to be a very high readiness force, able to deploy within 5
    days, with sustainability for 30 days. That alone signaled the
    entry of NATO into true out-of-area operations, I would say
    global operations. The first instance of the seriousness of the
    commitment is in Afghanistan, where NATO is currently
    considering and will expand significantly its operations and
    may in time, with the coordination with OEF, take up the
    majority, could potentially take up the majority of the
    stability, security, and reconstruction operations in
    Afghanistan.
        This is a very serious matter. It is being given a lot of
    thought in Brussels and elsewhere and we are in the first stage
    of implementing that new capability and that new commitment to
    be more influential in global affairs, but in real time.
        Senator Sessions. I was somewhat troubled by a recent
    report that NATO may not be sending as many troops to
    Afghanistan as they were originally projecting because of
    budgetary concerns. Are you aware of and concerned about that?
        General Jones. We have proposed from the military
    headquarters, which is SHAPE, to the North Atlantic Council the
    force required to support five additional PRTs. It is my
    understanding that nations are evaluating that recommendation
    and that we will soon be generating the force required to
    support those five reconstruction teams.
        So I believe that there will be different opinions,
    obviously, on the plan. There will be people who might disagree
    with certain aspects of it. But I believe the alliance is
    committed to doing more in Afghanistan, and I believe that we
    are on the way to doing that.
        Senator Sessions. General Jones, I think those are good
    developments, and we need to work with NATO and build that
    relationship that has the potential to create a partnership as
    we work together to protect our just national interests and
    preserve a peaceful, prosperous world.
        Of course, NATO's military, the number of people in uniform
    in the NATO European countries, actually is larger, I believe,
    than the number of United States soldiers in uniform. They are
    not as well configured, I think, to meet modern challenges, but
    they have a large number, and we need to work at that.
        I want to ask you about your plan to reconfigure our
    deployment in Europe. I like what you were talking about, a
    more expeditionary concept, moving more east and south where we
    can get better basing and air space and also be more available
    for deployment in hot spots that may occur. As I look at the
    numbers, the report I have, we have 70,000 soldiers in Germany.
    I know Germany was not with us in Iraq, and there are still
    some hard feelings about that. But beyond all that, it strikes
    me that the 118,000 uniformed personnel we have in Europe with
    125,000 dependents is way out of proportion to the reality of
    our world threat today.
        We are going through a base closing and realignment (BRAC)
    process in the United States. We would like to have bases, too.
    I am sure the Germans and everybody like our money being spent
    in their neighborhood. It is very popular. We are going to
    close a lot of bases in this country on one basis, I hope and
    trust, that it is good for the United States, it is a good,
    wise use of our money.
        I would just encourage you to fully understand that the
    American people and I think this Congress want a presence in
    Europe, a presence around the world. But we want as lean a
    presence as possible. It is not out of any pique at any other
    country. But if we cannot justify 70,000 troops and all those
    dependents in Germany, we ought to bring those numbers down,
    just like if we cannot justify it in Alabama somebody has to
    bring those numbers down.
        General Jones. Thank you, sir. Transformation is about
    developing how forces, through fairly dramatic reconstruction,
    can become more strategically effective. The old basing
    paradigms of the post-World War II era with the, I call it,
    fortress America, with the cities and the shopping centers and
    the families and the schools, while very important in the
    aftermath of World War II and still important from a standpoint
    of providing a launching pad for future forces, do not have to
    be nearly as numerous and, more importantly, we do not have to
    build new ones.
        So that the strategy, the strategic force of the future, at
    least in EUCOM and I think elsewhere, will be based upon a
    family of bases that are more expeditionary, that we can get to
    quickly. In this 93-country AOR, we are building a library of
    existing runways, ports, facilities, and relationships with
    countries we may need for response to crisis or response to
    interoperable training or whatever the reason, we know where
    these facilities are, so we have an ability to project forces
    over a broader distance.
        The force of the future will have some forward basing. It
    will be augmented by rotational forces coming from anywhere in
    the United States. It is an interesting and a little-known fact
    that the majority of forces in the Balkans come from the
    National Guard today. It does not matter that they are not
    based in Europe. They are doing an extraordinarily good job. It
    is a high morale mission. They are great soldiers. This
    rotation comes from Minnesota.
        So the old concept that we used to justify troop strength
    in Europe to defend against the former Soviet Union simply does
    not apply any more, and you will be, I think, pleased with the
    new structure, when it is announced, of the forces that we have
    in Europe. But you will also be, I think, energized by the fact
    that this new force, although lesser in size, will be able to
    be more effective across the length and breadth of our AOR.
        Senator Sessions. Thank you.
        General Abizaid, I too want to say I support very strongly
    the idea that our commanders need more funds that they can
    utilize to deal with situations in their areas of operations. I
    think it will make their soldiers safer. I think it will be
    spent more wisely than otherwise would be the case, will be
    done more promptly and effectively, and I believe we need to
    move on that. I support that and look forward to my second
    visit with you in a few weeks.
        General Abizaid. We look forward to seeing you there,
    Senator.
        Senator Sessions. Thank you.
        Chairman Warner. Thank you very much, Senator Sessions.
        We are pleased to recognize our distinguished colleague,
    Senator Lieberman. I think the record should reflect that this
    Senator, the distinguished Senator from Connecticut, has been
    in the forefront of the war on international terrorism. You
    were my principal co-sponsor in 1991 of the resolution to
    authorize then-President George Herbert Walker Bush to use
    force in Iraq. Again, you rejoined me, Senator McCain, and
    Senator Bayh in authorizing the resolution in the fall of 2002.
        Senator, we are very honored to have you as a vital member
    of our committee.
        Senator Lieberman. Thank you very much, Mr. Chairman. It
    was an honor to join with you on both of those occasions and
    many others. I certainly feel a sense of pride about what we
    did together and a confidence that the result was to make the
    American people and the world safer than they would otherwise
    be.
        Of course, the reason for that is the military, represented
    by General Jones and General Abizaid before us today, who
    implemented the resolutions that we were honored to put before
    the Congress. I thank both of you.
        I thank you, Mr. Chairman, Senator Levin. This has been a
    very productive and informative hearing. I must say, with the
    unique perspective I have just coming off the presidential
    campaign trail, I think it has focused us with regard to Iraq
    exactly where we ought to be. There is an inevitable way in
    which the natural drift of our politics may well continue the
    focus on how we got into Iraq, what the quality of the
    intelligence was, who did what. Those are not unimportant
    questions. They are quite important, but they cannot be
    allowed, even in this election year, to take us off the target,
    and the target is to successfully complete the mission in Iraq.
        It is of enormous importance now in the wider war against
    terrorism because of the forces that are engaged there. It is
    of enormous importance in our long-term commitment to create
    stability and hopefully opportunity and democracy in the Middle
    East, and it is enormously important to our security as
    Americans that the battle is really joined in Iraq between the
    forces of terrorism and the forces of security, the forces of
    tyranny and the forces of freedom.
        I do think, Mr. Chairman, under the leadership of yourself
    and Senator Levin, that this committee has a uniquely important
    role to continue to focus Congress, particularly in this
    election year when the normal cross-currents and swirling will
    be going on in public debate, on coming together, as we have
    most of the time certainly at our best on this committee, to
    focus on helping our military successfully complete this
    mission on our behalf. I think this hearing today is
    particularly focused on that.
        General Abizaid, just to focus now for a moment on the
    security question, which is clearly critical. The successful
    completion of our mission is a combination of our ability to
    work with the Iraqis and coalition forces to maintain security
    and also to create the social and economic conditions in Iraq
    that will make the country more secure.
        Obviously, this has been a tough week and a tough period of
    time. Tuesday, I gather, was the deadliest day in Iraq since
    May of last year. Maybe as many as 185 people were killed.
    Clearly, the insurgent and terrorist forces want to destroy
    security, want to create a civil war. It is creating unrest,
    unhappiness, anger among the Iraqi Shiites.
        I saw a quote today in the paper from one of them: ``We do
    not want the police and the military, we do not trust them.''
    It is also creating problems for our Intelligence Community,
    which is critical to our success there, as you said. Someone
    was quoted in the paper today from an unnamed intelligence
    agency: ``The violence is making it more difficult to
    operate.''
        So I wanted to first ask you this question. There have been
    reports that there is a plan for our military to essentially
    move out of our major urban bases and occupy more fortified
    bases for regional control, as somebody described it to me,
    conducting selected operations from there and yielding most of
    the security responsibility, in the urban areas at least, to
    the Iraqi forces.
        So my question is: Is there such a plan? If so, when do you
    hope to implement it? Of course, the larger question is: Are
    the Iraqis really ready to take on that responsibility alone,
    or certainly more than they are today?
        General Abizaid. Senator, there is a strategic direction
    which as an outline of a long-term effort makes a lot of sense
    to me, which is over time, and where geographically possible,
    you turn over more and more control to Iraqi security forces as
    they are able to take control. I believe that we have
    characterized this correctly by calling the first step local
    control, and local control means essentially Iraqi police units
    and ICDC units doing the day-to-day policing of major urban
    areas or those areas where they are capable of doing it and
    that there is good cooperation between the populace and the
    security forces.
        We can envision a time where we move to a greater standoff,
    where Iraqi military forces are more and more capable and Iraqi
    border police forces are more and more capable, where
    essentially coalition forces are used more to defend the
    territorial integrity of Iraq against external threats. Then
    obviously I think you get to the point where you go into the
    period of what I would call strategic standoff, which allows
    you to continue to build Iraqi security capacity through a
    robust system of security cooperation, that it puts
    expeditionary forces in readiness to come to the aid of an
    Iraqi government should it, number one, require it; number two,
    request it.
        To me this is a logical way of looking at how the mission
    would progress. But there is a misreading largely in the press
    of the idea that we are going to move to regional control
    immediately, and we will not do that. We will reposition forces
    in places like Baghdad, for example, in order to get enduring
    installations in the right locations.
        The number of patrols in Iraq is pretty much the same today
    as it was 6 or 7 months ago, with the exception that there are
    more patrols in Iraq being done jointly between Americans,
    Iraqi military units, and Iraqi police units. So the natural
    evolution certainly has to take place, but it is an evolution
    that has to be synchronized with political activity and
    economic activity to a certain extent.
        People seem to think that you must have security before the
    others can move forward. But the truth of the matter is you
    have to synchronize security, economy, and politics in a manner
    that allows people to have a better future. I think we all need
    to understand that there is a certain level of violence in Iraq
    that as long as we are there we will face, and there are no
    places in Iraq that we can retreat behind and allow us to be
    safe.
        The safest way to deal with Iraq is to be out with the
    population, to be developing security forces, to engage with
    people, to try to make their lives better, and at the same time
    aggressively confront the enemies that are trying not only to
    kill us but to kill them, their own people.
        So I know that is a long answer, but I am satisfied that
    the plan that General Sanchez and I have discussed militarily
    is one that will continue to keep military forces properly
    engaged. Ultimately all of us understand that we have to take
    some risks in turning over control and authority to Iraqis. We
    have to understand that this is not our country. There is
    nothing in Iraq that belongs to the United States of America,
    and we have to have this courage to look at the Iraqis when we
    think they are ready and say: This is now your street to
    patrol, this is now your city to control; and when they need
    help, come in and help them.
        There will be times, Senator, when we will meet with
    failure. But over time we will have more and more successes. As
    I said, I believe that is the right thing to do.
        Senator Lieberman. Thanks very much for that answer. I take
    encouragement from it, and I hope it will clarify some
    questions people have raised, because this plan to move out of
    the urban areas into a kind of regional control--you used the
    terms, I believe I am quoting right, ``long term'' or ``longer
    range,'' to do it where it is geographically possible and turn
    over more responsibility to the Iraqi security forces as they
    are able to assume that control.
        So is it fair for me to conclude that you are not on a
    particular timetable in implementing the plan?
        General Abizaid. Sir, we are not on a timetable. We are on
    a timetable to do the mission right.
        Senator Lieberman. Because the conclusion that some are
    coming away with--and I agree this is mostly in the press, but
    I think it is very important. Frankly, going back to what I
    said at the beginning of my remarks about the intermixing of
    politics and the carrying out of your mission--that this might
    actually happen as of June 30 when the transfer of sovereignty
    occurs. I take it that that is not your plan?
        General Abizaid. Sir, it is not our plan and it is not the
    plan of the IGC, either. They have clearly put language in the
    Transitional Administrative Law that talks about a multi-
    national commander that was established under the provisions of
    U.N. Resolution 1511 or any other subsequent resolution that
    may come about, continuing to maintain operational control of
    all forces, to include Iraqi forces in Iraq.
        But I would also say, Senator, that it is very important
    for us to not only make the Iraqis understand, but make our own
    people understand that we must move from a position of
    perceived occupation and control to one of partnership. I would
    say the post-June 30 period represents an opportunity for us to
    be in partnership with the Iraqis more so than some might say
    today.
        Senator Lieberman. I know we share that goal. Of course the
    worry would be--and I am sure you will not do this--that the
    transfer could occur prematurely, so just while the Iraqis were
    beginning to assume sovereignty that vulnerabilities or even,
    at worst, chaos would result, and that the insurgent and
    terrorist enemy would strike and take advantage of it. That
    would be the most staggering disaster that could occur.
        General Abizaid. Sir, this mission will take a lot of
    toughness, a lot of courage, and a lot of determination. Our
    soldiers have it and so do the Iraqi people.
        Senator Lieberman. Thank you very much.
        Thanks, Mr. Chairman.
        Chairman Warner. Thank you, Senator Lieberman.
        In your response to one of his very able questions, you
    talked about the patrols by U.S. forces and working elements of
    the Iraqi army and police and so forth. I just want to make
    sure that the record reflects that similar patrols outside of
    the Baghdad area are being conducted by coalition forces, so in
    no way are just U.S. forces in the more serious aspects of
    harm's way. Am I not correct on that?
        General Abizaid. You are correct, Senator.
        Chairman Warner. The Iraq Survey Group (ISG) is one that
    certainly is of great concern to this Senator. I want to make
    certain that it has the adequate numbers, the adequate
    resources, and the adequate interest on the part of you and
    your subordinate commanders as it completes its mission, which
    mission is quite indefinite. Can you give us a little update on
    that?
        General Abizaid. Sir, the ISG continues to carry out its
    mission. I agree with you that one of the most important things
    we must understand is what happened to the weapons of mass
    destruction, and we do not know the answer to that. Until we
    know that answer----
        Chairman Warner. Well, we know part of the answers, but the
    full picture is yet to be developed.
        General Abizaid. Sir, I agree we know partially, but we
    need to know completely.
        Chairman Warner. Yes, and I share that view.
        General Abizaid. So I think, Senator, that the mission will
    continue, but the mission will continue in a way that is
    complementary to the counterinsurgency work that is going on in
    a way that has already proven to be very beneficial to both
    General Dayton's mission and General Sanchez's mission. So I
    would expect that we will continue to look, not only on the
    ground, but look in the documents for some sort of an
    indication as to what happened.
        Chairman Warner. Very often the ISG has come across
    intelligence which is of direct value to those performing the
    counterinsurgency operations, and therefore I think that is
    what you meant when you said they work in a cooperation and are
    related.
        General Abizaid. Those are great people in the ISG.
        Chairman Warner. Oh, they are. I am very impressed with
    General Dayton. I have met with him each time he has been back
    here. I like the new civilian counterpart, Dr. Duelfer, who is
    over there working with him.
        Now let us turn to--I think it is important that every
    record of this committee, when it is appropriate, reflects your
    views with regard to Osama bin Laden and current efforts under
    way and the extent to which the government of Pakistan and its
    forces are contributing and supporting those efforts to try and
    in one way or another apprehend him and his principal
    lieutenants.
        General Abizaid. Sir, of course you have read and heard in
    the press the idea that Osama bin Laden is surrounded, and we
    have him cornered, and we know where he is, et cetera. Of
    course, we do not know that. It is our belief that somewhere
    along the Afghan-Pakistani border area, either on the Pakistani
    side or on the Afghan side, we will find him and his close
    companion Zawahiri.
        We are conducting very robust military operations on the
    Afghan side of the border with coalition forces. We have had
    good effect against Taliban. We have had good effect against al
    Qaeda forces that we found there. On the Pakistani side of the
    border, I think it is clear to President Musharraf and the
    Pakistani people that Osama bin Laden, Zawahiri, and al Qaeda
    represent a threat to their freedom and a threat to their
    continued development as a moderate state of great importance
    in the region.
        So Pakistani forces have been operating in the federally
    administered territories up along the Afghan border in a way
    that we have not seen in a while, but in a way that I think
    will have effect on terrorist organizations.
        Senator, manhunts are not things that militaries do well.
    What we do well is put pressure on groups and organizations,
    and we are continuing to put lots of pressure on al Qaeda and
    the Taliban in areas along the border that does not allow them
    to have a sanctuary from which they can plan new attacks
    against the United States.
        I think it is of great importance to our Nation to bring
    these two people to justice, but it is of even greater
    importance to our Nation to ensure that this organization, al
    Qaeda, is destroyed.
        Chairman Warner. I thank you.
        General Jones, last spring my distinguished colleague
    Senator Levin and I co-authored a declaration included in the
    resolution of ratification of the most recent round of NATO
    enlargement. That resolution would have the United States bring
    up for discussion in the North Atlantic Council the question of
    whether NATO should continue to make all decisions by
    consensus.
        In the areas under your responsibility, such as planning
    and conduct of operation, has the consensus rule worked? Do you
    have the authority to plan potential contingency operations
    before the council formally approves such planning? As you
    anticipate NATO's expansion to 26 members, in other words
    giving another significant number of members veto power, do you
    think it would be useful for NATO to have the flexibility to
    reach decisions on certain matters by means other than the
    consensus rule?
        We ask this question each time you come before us because
    it is of great concern to not only this committee, but I
    believe the Congress as a whole. So this is your opportunity to
    give us an update on a subject which you have closely followed.
        General Jones. Thank you, sir.
        The terms of reference that govern our activities, whether
    for the Military Committee or the two strategic commanders, are
    products that were created in the 20th century under another
    time.
        Chairman Warner. When you say ``another time,'' that is a
    key phrase. You are referencing the Soviet Union and the Warsaw
    Pact?
        General Jones. Yes.
        Chairman Warner. The world threat situation has changed so
    dramatically to where we are now confronted, NATO and all
    forces of freedom, confronted with non-state-sponsored
    terrorism, in which instance you have to move with the greatest
    of speed to interdict or further prevent their efforts.
        General Jones. It is my opinion, and that of Admiral
    Giambastiani, the Supreme Commander for Allied Command
    Transformation, that it is time to look at the foundational
    documents that govern the way we do things, the speed with what
    we do them, the processes, to see if in fact they are in
    consonance with what it is we are asked to do.
        The Prague Summit signaled a stark change in the
    capabilities that NATO wishes to acquire, and it also signaled,
    I think, the entry into a 21st century capability that suggests
    that NATO wishes to be involved on the global scale and have
    the capability to do so. That includes acquiring some of the
    higher end items of warfighting: transformation of NATO
    logistics, transformation of the modes by which we deploy.
        The starkest example that I can come up with is the
    prescripted requirement to develop a NATO Response Force that
    can deploy within 5 days and sustain itself for 30 days on a
    mission, presumably anywhere on the globe. We have been working
    with the authorities, the Military Committee, the chiefs of
    defense of 19 sovereign nations, soon to be 26, the Secretary
    General of NATO, and after reviewing the baseline document that
    governs the way we do business, we are hoping that the decision
    will be made in the near future, perhaps in May, to open those
    documents, to rewrite them in such a way that things like
    prudent military planning and the execution phase of a decision
    to pass to operations can be done in a manner that is
    consistent with the overall transformation of NATO.
        In other words, the fundamental rules that govern our
    behavior, that govern the way we make decisions, have to be
    looked at to see if they are in consonance with the desires of
    the Prague Summit, and I believe that the Secretary General and
    others are willing to do that. I would expect that at the next
    full meeting of the Military Committee with the chiefs of
    defense that they will look at those documents and decide that
    it is time to update those documents in a way that will enable
    us to do those things that 19 sovereign heads of state have
    mandated us to do.
        Chairman Warner. You mentioned the word ``May.'' That
    coincides with the Istanbul Summit or it is preliminary?
        General Jones. It would actually precede it, Mr. Chairman.
        Chairman Warner. That is a matter that should be brought up
    at that summit?
        General Jones. Yes, sir. I think it will be dealt with by
    the full meeting of the Military Committee with all 26 chiefs
    of defense and the two strategic commanders. Really, I think it
    is such an obvious requirement that I think we will be under
    way with this.
        Chairman Warner. I will be in consultation with my
    colleague, but I think that it might be appropriate if we wrote
    a letter asking specifically that this be an agenda item and
    the preliminary work done.
        I thank you, General.
        General Jones. Thank you, Senator.
        Chairman Warner. Senator Levin.
        Senator Levin. Thank you.
        I understand from your answer that the issue which the
    chairman raised about the consensus requirement, which gets
    clumsier and clumsier as you have more and more members and
    have to reach out further and further, that that would be one
    of the issues that would be under consideration: Is that fair?
        General Jones. I think nations would--I do not want to
    speak for the individual nations at the political level, but I
    think that is something that has been discussed, and I think
    the evolution towards whatever solution may be found, would be
    something along the lines that nations do not have to be bound
    to support a given operation if they do not wish to, but at the
    same time do not arbitrarily have to say, to bring the
    operation to a stop simply because we do not wish to
    participate.
        I will say that I think the consensus rule is at least
    intellectually a good thing, because it stimulates debate and
    you get good ideas, but at the time when you decide how you are
    going to announce your decision, that is where building the
    NATO Response Force and this very capable force kind of comes
    into a sense of a new dimension where speed of decisions are
    also important if you wish to affect the outcome of a
    particular crisis.
        Senator Levin. Having 26 possible vetoes over moving a
    force, putting together a force in 5 days and moving it
    somewhere is not the way to operate.
        General Jones. No, sir.
        Senator Levin. I hope that you are able to get that on the
    table for a real thorough discussion, because it is a new
    world.
        General Jones. Yes, sir.
        Senator Levin. General Abizaid, the President of
    Afghanistan, in response to a journalist's question, last week
    implied that al Qaeda and the Taliban were becoming--well, he
    said the following: ``That we strongly believe, with evidence,
    that they are defeated, they are gone. We do not see a
    resurgence of the Taliban. The Taliban is a movement that does
    not exist any more.''
        Would you agree with that?
        General Abizaid. Sir, I would not want to be one to
    contradict President Karzai. However, I would say that the
    Taliban as a movement is in very desperate straits and al Qaeda
    as an organization is under a lot of pressure, but both the
    Taliban and al Qaeda are resilient in Pakistan, and they are
    dangerous in Afghanistan.
        There are some very promising signs, however. Certainly
    some mid-level leaders that had been prominent in the Taliban
    movement have approached various people about chances for
    reconciliation. So there are hopeful signs that people want to
    get on with a better future in Afghanistan.
        But these are dangerous foes. They remain dangerous to
    President Karzai and they remain dangerous to us.
        Senator Levin. General Abizaid, the Marines, I understand,
    plan on rotating into Iraq in March with two 6-month rotations
    of 21,000 marines each. Why are the Marines going on 6-month
    rotations while the Army does 12-month?
        General Abizaid. Sir, I do not know that.
        Senator Levin. You do not know that what I am saying is
    accurate?
        General Abizaid. I do not know that the Marines are
    planning on two 6-month rotations. I know that General Hagee
    talked with me about being flexible with regard to Marine
    deployments. Since about one-third of the marines that are
    entering into Iraq have already served there and as rotational
    schedules are under the purview of the Services, I am okay with
    that.
        Senator Levin. There is a program in Korea called the
    Korean Augmentation to the United States Army (KATUSA) where
    Korean soldiers, South Korean soldiers obviously, are
    integrated into U.S. units. Do you see that that might be a
    possible program in Iraq?
        General Abizaid. Sir, I think it is a program that we have
    looked at before and that we talked about before. But I think
    it is better to have U.S. mentors in Iraqi units rather than
    Iraqi soldiers serving in U.S. units in a KATUSA-like program.
    I think the partnership is important, but the partnership is
    stronger with U.S. units training and mentoring Iraqi units.
        Senator Levin. Relative to the Iraqi army, to your
    knowledge were our uniformed military leaders asked for their
    recommendation relative to disbanding the Iraqi army prior to
    that decision?
        General Abizaid. Sir, I am not completely sure whether
    General Franks was asked about his opinion. At the time he was
    the combatant commander. I cannot answer that.
        Senator Levin. Were you asked?
        General Abizaid. No, I was not.
        Senator Levin. Just one other comment about NATO. General
    Jones, the chairman made a comment about the importance of a
    robust NATO and a forward engagement approach, which a number
    of my colleagues have endorsed here today, and you clearly
    testified relative to that fact. I just want to join the
    chairman in those comments.
        I think there is a very strong consensus here that you are
    moving in the right direction, meeting new threats; and you
    should just be aware that there is, I think, a really strong
    consensus in Congress supporting the direction that NATO is
    moving.
        General Jones. Thank you very much, Senator. That is very
    gratifying to hear. I think in the near future you will see
    that--yes, last year when I was here I characterized NATO as
    being at the crossroads between two centuries, and
    ``crossroads'' means you have choices, directions you can take.
    I think NATO in this past year has taken a very strong step in
    the right direction.
        We need to have this strong consensus here in the United
    States and the support of this committee towards that
    direction, because it will only help the world's situation if
    we are able to bring an armed force of 2.4 million people in
    uniform in Europe into more productivity on the world stage. It
    will help us immeasurably.
        Senator Levin. Thank you both again.
        Chairman Warner. Thank you, Senator Levin.
        Gentlemen, I am faced with the need to get to the floor.
    There is a very critical amendment, Senator Levin, on Buy
    America provisions and I am hopeful that Senator McCain and I
    and others can make some provision for DOD amendments to
    protect our ability to do contracting and to access the
    industrial base, weapons base, of other countries in such a way
    as to strengthen our own forces.
        But I am just going to mention quickly subjects of
    questions and I am going to ask, if I might, for you gentlemen
    to reply in due course to these questions in the record. The
    status of forces agreement, General Abizaid; I am concerned
    about that, particularly how we protect U.S. forces after June
    30 from any basis of prosecution under Iraqi law.
        Iran again harboring al Qaeda and other interests. The
    nuclear development program. I would like to have your
    assessment with regard to the threat of that mission today.
    Recent change in their political structures, we need an update
    on that.
        Pakistan. General, President Musharraf continues to be a
    very strong working partner and has done a great deal to date.
    Nevertheless, they have been involved in alleged activities on
    proliferation of WMD, perhaps entirely in the civilian
    structure. But I need again your assessment on the level of
    support that we are receiving from the president and other
    Pakistani security interests in this global war on terrorism.
        NATO peacekeepers in the Middle East. This is a subject
    that you and I discussed regularly, General Jones. I feel that
    if the governments of Israel and Palestine were to issue an
    invitation that NATO might have some role to help stop the
    incredible amount of loss of life on both sides, the
    instability in that region.
        I also feel, General Jones--I think you share this view
    with me--that we cannot look at Iraq and to a lesser extent
    maybe Afghanistan, isolated from this conflict, because the
    strong emotional feelings surrounding this conflict have worked
    their way into the minds of others who are directly influencing
    the course of events in Afghanistan and Iraq.
        The Horn of Africa. General Abizaid, I am pleased that your
    command has that AOR and you have given it the focus and
    attention, because help is needed in that area to the extent we
    can get it. If we do not, it will spread elsewhere.
        The National Intelligence Estimate (NIE) on Iraq. I want to
    get an update in detail on that and what assistance you might
    be receiving from other nations and what more can we do to
    assist you in that.
        The Afghanistan illegal drug trade, General Jones. This
    concerns this Senator a great deal. Mixed reports, but clearly
    a strong and more robust activity on that front. In parallel,
    at the same time we are making progress in Afghanistan. Both
    generals have responsibilities in this area at this time. So I
    am hopeful that you can provide additional information to this
    committee.
        [The information referred to follows:]

        Afghanistan's illegal drug trade has increased over the past 2
    years and returned to record high levels of production and processing.
    Resulting increased discovery of drugs and drug paraphernalia by
    coalition forces has resulted in the need for field commanders to
    clarify procedures for disposition of drugs and drug paraphernalia
    discovered during normal operations. This guidance specifically
    addresses which items may be retained for possible future transfer to
    the Afghan Government and which items coalition units retain the
    authority to destroy. CENTCOM and supporting subcommands do not have a
    counternarcotic or law enforcement mission. However, subcommands
    continue to discover drugs and drug paraphernalia during the course of
    normal operations (i.e. cordon and search, vehicle check point) .
        Confiscating drugs and drug paraphernalia found does not convert
    combat or stability operations into either a counter-narcotic or law
    enforcement mission. The on-scene commander will report any quantity of
    drugs or drug paraphernalia found during normal operations and then
    confiscate and destroy the drugs and drug paraphernalia. This authority
    does not extend to the destruction of poppies in fields or unprocessed
    poppies. Additionally, CENTCOM will play a role in supporting the
    United States Government's commitment to collect drug-related
    intelligence to include suspected locations of stockpiles, opium
    bazaars, known traffickers, and shipments of narcotics and precursor
    chemicals, and will forward this information to the United Kingdom, in
    accordance with existing arrangements. Our forces will also provide
    United Kingdom Forces the use of U.S. facilities for storage and
    forward mounting purposes whenever possible.

        Chairman Warner. All right, gentlemen. We have had an
    excellent hearing. I know this takes you away from your
    respective commands, but it is enormously important to
    Congress. This is the third committee you have been before this
    week and you fulfill your duties with great distinction.
    Particularly, both of you have, I guess I can use the word,
    mastered congressional relations and work it very well.
        Thank you.
        Senator Levin. Was that a compliment, Mr. Chairman?
        Chairman Warner. I think that is a compliment.
        Senator Levin. Be careful.
        General Abizaid. Sir, it is a great honor to sit next to
    General Jones today. We served together. I was his subordinate
    in northern Iraq, and I would welcome him taking northern Iraq
    if he would like to, any time he is ready.
        General Jones. I was just about to propose. I have 93
    countries. I have about half a dozen that I would like to----
        Chairman Warner. That you could shift off.
        But I do remember very vividly being with our former
    distinguished chairman, Sam Nunn, in NATO South headquarters
    with the then-NATO commander, who later became the CNO. I
    recall him very well with great fondness. In the room you
    walked in your combat fatigues and briefed us extensively. Was
    that the same period of time when you two gentlemen were
    together?
        General Jones. Sir, that was about a year and a half later.
        Chairman Warner. Than when you were first linked up?
        General Jones. We were linked up in the spring of 1991 in
    northern Iraq for Operation Provide Comfort.
        Chairman Warner. I remember that, yes.
        General Jones. Then I was subsequently assigned as the
    Chief of Staff for Operation Provide Promise for the Balkans,
    and that was at Admiral Boorda's headquarters.
        Chairman Warner. Gentlemen, you offer tremendous
    inspiration to those young officers, men and women, and their
    families coming up through the ranks. I think they say: Well,
    if those two guys can succeed, we have a chance.
        Thank you very much.
        [Questions for the record with answers supplied follow:]
                  Question Submitted by Senator Susan Collins
                                 troop rotation
        1. Senator Collins. General Abizaid, in your testimony before this
    committee in September you said, ``One of the most important things for
    any soldier to know is when are they coming home. They need to know
    that. Unfortunately, I can report to you that not all of them know that
    . . . I take it as my responsibility, I will work it, and I will ensure
    that the new guys coming in know when they're coming home. Nothing is
    more important. It is not right now and it needs to be fixed. I am
    concerned about the troops in Iraq who still have not been given dates
    on when they will return home. That includes the National Guard and
    Reserve, some of whom have been in Iraq for nearly a year with no clear
    indication of when they will return. Can you give us a clearer picture
    of rotation dates?
        General Abizaid. U.S. Central Command (CENTCOM) diligently tracks
    all force rotations and values the importance of informing every level
    of command of their established rotation dates. The CENTCOM Force
    Rotation Tracking Cell meets daily to de-conflict any issues with units
    exceeding the original deployment dates, or ``boots on ground (BOG)
    date.'' CENTCOM's guidance is very clear on this issue; all battalion
    and separate company-level units will know their BOG date and CENTCOM
    meticulously tracks those dates to mitigate any problems.
        Combined Joint Task Force 7 (CJTF-7) tracks unit BOG dates down to
    the battalion and separate company-level using the CJTF-7 Master Force
    Tracker. This is an EXCEL Spreadsheet used to track the transition of
    units between Operation Iraqi Freedom (OIF)-1 and OIF-2. This document
    is maintained on the CJTF-7 secure Web site for all to view, thus units
    can check their BOG data at any time.
        Several tools assist rotational planners in tracking unit BOG
    dates.

             The best system for determining unit BOG is the
            Mobilization Deployment Integration System (MDIS).

                     Web-based database that lists the actual
                    arrival dates of all units in theater and lists the
                    deployment information for units as they arrived in
                    theater. (The most difficult thing when determining a
                    unit BOG date is that no Web site or database actually
                    contains a field titled BOG, thus it is not an exact
                    science).

             Only the Secretary of Defense is authorized to extend
            a unit beyond their BOG date.

                     Thus far, the Secretary of Defense has granted
                    15 extensions to unit BOG dates for the OIF-1 and OIF-2
                    transition, which have affected slightly less than
                    2,000 soldiers.
                     These extensions have averaged 24 days, with
                    individual unit extensions spanning a period between 5
                    and 60 days.

             The CJTF-7 Transition Cell conducts weekly Transition
            Boards, chaired by the Deputy Chief of Staff, to establish
            dates for unit rotations or redeployments.

                     CJTF-7 coordinates logistics support and
                    administrative arrangements with Coalition Forces Land
                    Component Command (CFLCC) in Kuwait, and then publishes
                    a Fragmentary Order (FRAGO) delineating significant
                    unit transition information.
                     This FRAGO contains the unit's transfer of
                    authority (TOA) date, release date, redeployment
                    assembly area (RAA), the date to occupy the RAA, and
                    the unit's projected available-to-load date (ALD).
                     Along with dates and locations, this FRAGO
                    informs the units how to execute redeployment, giving
                    instructions and points of contact within CFLCC to
                    assist in their movement out of theater. This FRAGO as
                    with all CJTF-7 orders is posted on the CJTF-7 SIPR and
                    CENTRIX Web sites for units to download.
                     Subordinate units have similar tools as the
                    CJTF-7 Master Force Tracker to track additional data to
                    ensure that units depart theater in a timely manner.
                     CENTCOM has no separate channels for informing
                    Guard and/or Reserve units vice active component units.
                    All units are part of a chain of command. Thus, the
                    chain of command informs subordinate units and soldiers
                    of their redeployment instructions.
                     CENTCOM projects all OIF-1 units to be closed
                    back in their home station by end of May 2004. Every
                    effort is made to ensure all units understand and can
                    convey their BOG date to all soldiers. CENTCOM focuses
                    on providing the warfighting commanders with maximum
                    flexibility, and capability to support theater
                    operations, and to maintain security without
                    interruption. This is a critical ingredient to
                    developing a viable rotation schedule of this
                    magnitude. From Jan.-May 2004, CENTCOM will have
                    facilitated the historic movement of over \1/4\ million
                    servicemembers in/out of the CENTCOM area of
                    responsibility (AOR).
                     Early arrival and late arrival dates to duty
                    station:

                    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                     ______

                 Questions Submitted by Senator Elizabeth Dole
                          input on resource allocation
        2. Senator Dole. General Jones and General Abizaid, I would like
    each of you to comment as to whether you, as combatant commanders, had
    sufficient input and whether your priorities were given sufficient
    weight as the Department of Defense (DOD) conducted its resource
    allocation decisions leading up to the fiscal year 2005 President's
    budget.
        General Jones. U.S. European Command (EUCOM) was afforded the
    opportunity to provide input during the program and budget review
    cycle. At the time my overall analysis showed that risk levels for
    current theater requirements were as expected and resourcing was about
    right. With the advent of the Secretary of Defense directed Joint
    Capabilities Development Process (JCDP) the weight placed on my input
    will continue to increase.
        We have closely coordinated and worked with the Office of the
    Secretary of Defense (OSD) and with the Services that possess Title 10
    authority for funding our requirements. First the components in EUCOM
    and their respective Services have coordinated and synchronized our
    requirements in a fiscally challenging time. At the EUCOM level we have
    further refined and outlined our priorities in the Integrated Priority
    List (IPL) that was submitted to the OSD. An element from the EUCOM
    staff visited the Services in December 2003 to continue the
    coordination with the Services and ensure that the priorities outlined
    in the IPL were clearly understood. The Services have been extremely
    supportive working with us and our components here in EUCOM. OSD has
    likewise listened to and understands our priorities. One clear example
    in this regard is that the fiscal year 2005 request for funding
    reflects three agency projects that were originally requested but not
    appropriated in fiscal year 2004.
        General Abizaid. The CENTCOM portion of the overall President's
    budget is minor in comparison to Service budgets. Our direct budget
    only covers the necessary funds to operate the headquarters. The cost
    of our day-to-day operations is bourn by our Service components. It is
    their responsibility to budget through their Service channels for the
    missions and tasks assigned to them by CENTCOM. As you are aware, each
    combatant command has a Service Executive Agent for funding. The
    CENTCOM's funding executive agent is the U.S. Air Force. We work
    through the air staff to address our headquarters requirements. Between
    CENTCOM and the air staff, we feel our priorities are well aligned, and
    we have sufficient avenues of redress to resolve any disconnects that
    may arise. For those budgetary issues outside of headquarters funding,
    we work closely with the Service components and the Joint Staff to
    highlight any issues that we feel need to be addressed. Between
    headquarters CENTCOM staff, the component staffs, the Joint Staff, and
    if necessary, the staff of the OSD, there are sufficient mechanisms to
    influence the budget process.

                              unfunded priorities
        3. Senator Dole. General Jones and General Abizaid, what are your
    top unfunded priorities, and the associated risks, for each of your
    combatant commands under the fiscal year 2005 President's budget
    request?
        General Jones. EUCOM's top unfunded priorities include theater
    command, control, communications, and computer (C\4\) modernization
    necessary to improve interoperability in Net-Centric Warfare and
    Information Superiority operations; and an increased intelligence,
    surveillance, and reconnaissance (ISR) capability to prosecute the
    global war on terrorism and provide forward homeland security. The
    associated risks are that we continue to execute the global war on
    terrorism with yesterday's capabilities, not taking full advantage of
    the latest technologies. These technologies will enhance our ability to
    engage potential terrorist threats earlier and more effectively.
        The top unfunded military construction (MILCON) priorities at EUCOM
    are projects supporting the Efficient Basing Grafenwoehr (EBG)
    initiative, our number one MILCON priority program. There are four
    critical MILCON projects: a barracks, $45 million, and three battalion
    maintenance and operation facilities, $82 million, that if funded would
    keep EBG on track. The total cost of these four critical unfunded
    projects is $127 million. Funding these projects in fiscal year 2005
    will enable U.S. Army Europe (USAREUR) to continue the planned closure
    and turnover of 13 installations to the Federal Republic of Germany on
    the original timeline. This would also, with continued support for the
    EBG program in fiscal year 2006, allow the consolidation of a Brigade
    Combat Team to Grafenwoehr beginning in the fiscal year 2007 time
    frame.
        General Abizaid. We are currently concluding our review of the
    fiscal year 2005 presidential budget request, and working through any
    issues we might have with the air staff (for headquarters CENTCOM
    budget issues), and the Joint Staff and OSD (for any Service component
    funding issues). It would be premature to discuss any shortfalls or
    associated risk until a full review has been completed.

                           integrated priority lists
        4. Senator Dole. General Jones and General Abizaid, integrated
    priority lists (IPLs) are reportedly your main mechanism to inform the
    DOD resource allocation process. In your opinion, how much weight have
    your IPLs been given during the development of the budget request?
        General Jones. The EUCOM fiscal year 2004-2009 IPL was given a
    great deal of weight and served as a programmatic document. We were
    able to use the IPL in order to demonstrate and maintain consistency in
    presenting theater requirements. The fiscal year 2005-2009 IPL carried
    those requirements forward. The Secretary of Defense has introduced,
    starting with the fiscal year 2006-2011 cycle, a refocused IPL which
    reflects the DOD's emphasis on capabilities based planning. This is
    designed to create a more effective IPL which should receive greater
    weight in resource allocation decisions.
        General Abizaid. The IPL is one of several mechanisms available to
    CENTCOM to inform the Department of resource issues. Beginning with the
    fiscal year 2006 budget request, the Department revised the IPL process
    to add even more emphasis to this resource shaping tool. The Department
    has transformed the IPL to address individual combatant command
    capability gaps. It is then up to the Joint Requirements Oversight
    Council (JROC) to cross-walk the combatant command IPLs and develop a
    coherent Department position. The JROC takes these gaps and translates
    them into guidance to the Services in the Strategic Planning Guidance
    (SPG) and the Joint Planning Guidance (JPG), issued by the Secretary of
    Defense. These two documents are directive in nature and guide the
    Service budget build. In their budget submission, the Service must
    demonstrate to the satisfaction of the Joint Staff, and indirectly the
    combatant commands, that they have addressed the identified capability
    gaps. CENTCOM has several opportunities throughout this process to
    ensure our priorities are known and addressed.

           success and challenges of the current unified command plan
        5. Senator Dole. General Jones and General Abizaid, the Unified
    Command Plan (UCP) delineates each of your areas of responsibility
    (AOR) as a combatant commander; however, the world's hot spots do not
    always fall neatly into just one combatant commander's area of
    responsibility. Could both of you please comment on the success and
    challenges of the current UCP with particular attention to the
    countries and regions that fall along your geographic boundaries, such
    as India, Pakistan, Syria, the Horn of Africa, and Lebanon, to name a
    few?
        General Jones. It is important to note that within the UCP, there
    is no intent to restrict combatant commanders from accomplishing
    assigned missions, rather geographic AOR are delineated as a basis for
    coordination by combatant commanders. The UCP provides adequate
    flexibility with respect to `hot spots' and combatant commanders may
    operate forces wherever required to accomplish these missions. When
    significant operations or `hot spots' do occur and overlap boundaries,
    a task force is formed. Command of the task force is determined by the
    Secretary of Defense and assigned to the appropriate commander. Also,
    forces directed by the Secretary of Defense may conduct operations from
    or within any geographic area as required for accomplishing assigned
    tasks.
        OIF and Joint Task Force Horn of Africa (JTF-HOA) highlight both
    successes and challenges involving geographic borders of EUCOM and
    CENTCOM. EUCOM has worked closely with CENTCOM in these critical areas:
    northern Iraq and the Horn of Africa. Our two staffs meet via video
    teleconference on a regular basis and exchange information critical to
    U.S. operations along these so-called ``seams.'' Additionally, the
    massive deployment and redeployment of thousands of troops and unit
    rotations are visible signs of the successful coordination and transit
    between combatant commanders. EUCOM has provided and continues to
    provide thousands of soldiers, sailors, airmen, and marines, as well as
    combat equipment, supplies, and logistics in support of CENTCOM
    operations. However combatant commanders do face challenges in building
    and developing cooperative relationships with coalition partners along
    geographic borders. During peacetime, security cooperation programs
    enable combatant commanders to improve regional security and create
    synergy between partners within and between AORs. These successes are
    evident today as numerous countries have become willing coalition
    partners and are providing troops and assistance to OIF. Challenges
    arise when state relations between the U.S. Government and some
    countries become strained and thus do not foster security cooperation
    programs, which was recently the case with two countries in the EUCOM
    AOR. As a result of these differences, the President and Secretary of
    Defense reassigned these countries to the CENTCOM AOR to improve the
    coordination with respect to OIF.
        General Abizaid. The UCP establishes the responsibilities and
    clearly defines geographic boundaries for combatant commands; however,
    these delineations are not intended to create ``borders'' or
    limitations for the combatant commander. Recognizing that ``hotspots''
    do not respect boundaries the UCP states that ``combatant commanders
    may operate forces wherever required to accomplish their mission.''
        The key to effective operation of forces across a boundary is
    coordination. Currently, if a major operation was to be conducted
    involving  two combatant command AOR it would be appropriate to form a
    JTF with input and assistance from the combatant commanders  involved.
    Additionally, in order to improve combatant commander coordination
    across AORs the Secretary of Defense has called for a ``seam
    mitigation'' effort. The intent of this initiative is to ``blur'' the
    lines created by the artificial boundaries of the UCP and thereby
    improve the United States' ability to accomplish military objectives.
    CENTCOM has initiated this effort with regards to India and Pakistan.
    In addition to improving coordination among combatant commanders, there
    is continual refinement of the geographic AORs though biennial UCP
    reviews.
        Review and refinement of the UCP is made in an effort to strengthen
    unity of effort, to achieve a more manageable span of control, and to
    improve warfighting effectiveness. Recent UCP initiatives have dealt
    specifically with countries positioned on the CENTCOM boundary. Syria
    and Lebanon are scheduled to be transferred to the CENTCOM AOR in the
    near future. These nations are more closely aligned culturally and
    politically with the current CENTCOM area and should military
    operations be necessary in either, it is likely these operations would
    be linked with other central region countries.
        The Horn of Africa is playing an increasingly important role in the
    global war on terrorism. As pressure is brought to bear in South Asia,
    terrorists could migrate into states adjacent to the CENTCOM AOR such
    as Uganda and Tanzania. These EUCOM nations, along with Kenya--which is
    in the central region--make up the Central African Community. Based on
    this established relationship, and the spillover of terrorists from the
    central region to Uganda and Tanzania, both the CENTCOM and EUCOM
    staffs are carefully linked to ensure appropriate coordination occurs.
        Finally, the situation with Pakistan and India is a crucial one.
    The United States' interest in the military posture of these two
    nuclear powers is significant. We must take measures to ensure the seam
    created between them by the UCP does not aggravate the existing issues.
    Accordingly, we recently conducted CENTCOM and Pacific Command (PACOM)
    staff talks on ``seam mitigation'' between these two nations. During
    these talks, the security cooperation plans of both combatant commands
    were examined in order to determine ways to leverage each combatant
    command's activities to foster regional stability. We intend to
    continue this dialogue and have additional forums planned on a
    recurring basis. CENTCOM will pursue stronger bilateral security
    relations with both Pakistan and India to reduce tensions, enhance
    peace, and security on the sub-continent, and develop concrete steps
    for reducing the risks of nuclear conflict.
        The issues created by the UCP can be significant and in some cases
    adjustment of the boundaries is necessary and appropriate. Periodic
    review of the existing boundaries and close coordination and
    cooperation between the regional combatant commands is the key to
    successfully executing our global strategy.

                   national guard and reserve force readiness
        6. Senator Dole. General Abizaid, the military is extremely busy
    executing the global war on terrorism, and military personnel from all
    components have deployed frequently to conduct operations in either
    Afghanistan or Iraq. National Guard and Reserve Forces will reportedly
    make up 40 percent of the military forces executing OIF-2. Under this
    operation, the 30th Heavy Separate Brigade, ``Old Hickory'' from North
    Carolina, recently began its deployment to Iraq, the first deployment
    of a full National Guard brigade in recent times. Lieutenant General
    Blum recently stated that the National Guard soldiers being sent to
    Iraq this year are the best equipped and trained forces, of any
    component, that the United States has sent into battle. As the
    supported combatant commander, could you please relate your assessments
    of the National Guard and Reserve Force readiness as they have arrived
    in theater and assumed their duties?
        General Abizaid. Lieutenant General Blum was accurate when he said
    the National Guard soldiers being sent to Iraq this year are some of
    the best-equipped and trained forces the United States has sent into
    battles. In fact, all the military forces the United States has
    deployed to the CENTCOM area of operation are without question the best
    trained and equipped forces on the globe. As you noted, the Reserve
    component will make up approximately 40 percent of the forces
    participating in OIF-2. This includes the major combat formations from
    your State of North Carolina, the 30th Heavy Brigade, as well as the
    39th Light Infantry Brigade from Arkansas and the 81st Heavy Brigade
    from Washington.
        The Reserve component forces are integral in our strategy to fight
    and win the global war on terror. By resource allocation design, most
    Reserve component forces are not resourced to the same level as their
    active component counterparts. However, upon Federal mobilization,
    Reserve component forces are provided additional resources and training
    to be on the same level as the active component, and go through
    validation before deployment. Once validated, Reserve component forces
    arrive in theater with the preparation to assume their duties
    successfully.
        I have received positive readiness feedback from State Adjutant
    Generals though our Joint Monthly Access for Reserve Components (JMARC)
    visits to Afghanistan and Iraq. On the topic of equipment and training,
    Major General William A. Cugno of Connecticut on his recent visit to
    Afghanistan last January stated, ``It was a tremendous validation and
    accentuation of the `One Army Concept','' and said ``I am able to
    explain with credibility that our guys have the best over there. I was
    able to put criticism to bed about the treatment of the National Guard
    troops and the accusations of a double standard. The bottom line is
    that the National Guard is being treated equally over there. The
    Division Commander, Brigadier General Austin of the 10th Mountain
    Division, briefed me and he could not say `thanks' enough for the
    Reserve component. He told me that 70 percent of his aviation unit is
    Guard and he has not had a single negative incident.''

                               ungoverned spaces
        7. Senator Dole. General Jones and General Abizaid, Director Tenet
    and Admiral Jacoby recently briefed the Senate Select Committee on
    Intelligence regarding current and worldwide threats to the United
    States' national security. Both gentlemen raised transnational issues
    associated with ineffective governments that can result in ``stateless
    zones'' or ``ungoverned spaces.'' Your combined AORs include 118
    nations with varying degrees of governmental effectiveness. While the
    majority of these nation states are under stable control, many are
    failing to provide basic public services and lack effective control of
    their populations or geographic boundaries. As the United States and
    its allies conduct the global war on terrorism, this has significant
    ramifications as ungoverned spaces have become prime breeding grounds
    for terrorist. Could each of you describe how you are addressing this
    threat, and its priority relative to challenges within the rest of your
    AORs?
        General Jones. The issue you identify with ``ungoverned spaces'' is
    part of a larger problem set we identify as ``Terrorist Safe Havens'';
    that is, those places where terrorists operate with impunity, without
    hindrance from governmental or non-governmental agencies. This broader
    definition of safe havens is important, as we find that 21st century
    safe havens are often multi-dimensional--and it is the blend of factors
    that work in the favor of the terrorist. Using Western Europe for
    example we could imagine a scenario where legal or jurisdictional
    ``havens'' could inadvertently delay the extradition of a wanted
    terrorist. So to answer the simple question first: the war on terror is
    the number one priority of the EUCOM, and denying terrorists their safe
    havens is our first priority.
        Within the EUCOM AOR we have identified a number of the physical
    safe havens you have identified as ``ungoverned spaces.'' These areas
    are located throughout our AOR from the deserts of Northern Africa and
    the Pan Sahel region to the Caucasus region affected by the insurgency
    in Chechnya to the war-torn areas of the Gulf of Guinea. Through our
    Campaign Plan, ``Defeating Terrorism in the AOR'', we have examined the
    different regions in our AOR to identify the different types of safe
    havens extant in each.
        Our current focus lies on the vast, remote, and sparsely populated
    deserts of North Africa and the Pan Sahel (NA-PS). This area is more
    than twice the size of Afghanistan and Pakistan combined. The NA-PS
    region is beset with a host of challenging problems: smuggling and
    other illegal activities; disenfranchised, often violence-prone,
    cultures susceptible to the proselytizing of radical Islam; and
    extremely limited infrastructure and government services. Moreover this
    area crosses the borders of eight nations--each with different
    capabilities and historically distrustful of one another.
        EUCOM is working on a long-term approach to eliminating this region
    as a potential terrorist safe haven. EUCOM recognizes the economic,
    social, and political conditions that enable terrorists to thrive, and
    the need to combat terrorism with more than just a military approach.
    Recognizing the multi-faceted nature of the challenge, we are working
    closely to ensure we support other U.S. Government efforts in the
    region.
        Militarily EUCOM, through our various components, is working on
    various aspects of the plan as we speak. Special Operations Command
    Europe (SOCEUR) is leading the way with a program training and
    equipping company sized, rapid reaction units, in the Pan Sahel. By
    providing training and some equipment we can prepare these nations to
    provide their own border security, internal defense, and
    counterterrorism efforts.
        While the NA-PS is our priority effort, it is not our only one. You
    heard in the testimony of March 4 the work being done in the Georgia
    Train and Equip Program. That program is nearly completed and it is
    already considered a success. Programs like Georgia Train and Equip,
    and the Pan-Sahel Initiative are an efficient, cost-effective way to
    deny terrorists access to potential physical safe havens. By training
    and equipping the military forces of nations which support the global
    war on terrorism, we enable our partners to establish the rule of law
    across their territories and deny their use to terrorists.
        General Abizaid. Within the CENTCOM AOR, ungoverned spaces present
    several challenges. Somalia, as a failed state is an governed area that
    provides an operating environment for Al-Ittihad al-Islami and al
    Qaeda. Pakistan is currently conducting operations in their loosely-
    controlled ``tribal territories'' bordering Afghanistan. Saudi Arabia
    and Yemen are increasing their cooperation and counter-terrorism
    capabilities to eliminate threats from their loosely-controlled common
    border area. In the case of Iran, lack of diplomatic relations results
    in a governed space in which CENTCOM has no access or authority to
    internally address terrorist threats that may emerge from that
    particular country; accordingly, containment is our primary tool.
        Winning the global war on terrorism depends on individual nations
    defeating terrorists within their own borders, thus establishing
    operational partnerships that help countries increase governmental
    control within their territory is a top priority. For example, in the
    Horn of Africa, Commander, JTF-HOA, is conducting maritime interdiction
    operations and working with governments in the region to strengthen
    their counterterrorism capabilities. In ungoverned areas such as
    Somalia or governed areas in which we do not have direct access, such
    as Iran, we are actively working to contain terrorist groups operating
    from and within these locations.
        Our ongoing efforts to defeat and/or deter terrorism in ungoverned
    spaces, as well as in governed areas in which we do not have direct
    access, are integral to executing the global war on terrorism in the
    CENTCOM's AOR.

                                 ``small wars''
        8. Senator Dole. General Abizaid, in General Hagee's testimony
    before this committee, he said that the Marines are drawing on lessons
    learned from its sister Services, coalition partners, interdepartmental
    agencies, and the Marine Corps' own ``Small Wars'' experience as it
    prepares for OIF-2. According to news reports, the Marine Corps is
    planning to take a ``fresh'' approach as it prepares to take over in
    areas currently occupied by the United States Army (for example,
    emphasizing restraint and cultural sensitivity, and living among the
    Iraqi population in platoon size elements). Does this mean that the
    Marine Corps and the Army will deliberately employ different strategies
    in OIF-2 and if so, why are different forces planning to operate
    jointly with different strategies? Is this consistent with the DOD's
    priority of enhancing joint warfighting capabilities?
        General Abizaid. The situation in Iraq has changed as we are now
    facing a insurgency within Iraq. In addition, we now have some Iraqi
    security forces established and working with coalition forces. These
    two factors will require changes in the approach a unit must take to
    achieve objectives. Our strategy emphasizes the empowerment of Iraqis
    and gaining the confidence of the Iraqi population to achieve our
    objectives. The Marine Corps' approach reflects this changing security
    framework, and their ability to apply past experiences embodied in
    their manual ``Small Wars'' to this situation. This approach is
    consistent with the coalition strategy which is also evolving based on
    the changing nature of the conflict. The Marine Corps, like other U.S.
    and coalition forces, are drawing on what they have found to be the
    best of their own experiences to achieve their objectives.
        The approach described by General Hagee simply means that the
    Marines will be using different techniques to achieve their objectives.
    The situation in Iraq is dynamic, and the proposed operational approach
    reflects the Marines' willingness to adapt to the situation to
    overcoming unique operational problems. Some of these techniques are
    currently being employed by other coalition forces in other parts of
    the country. The Marines intend to use the transition period to
    implement these techniques and test their ability to achieve our
    objectives using a less kinetic approach. The main objective is to
    adapt to the changing environment, a counterinsurgency, and use what
    works. The approach taken by the Marines is an effective strategy
    against a counterinsurgency and is consistent with CENTCOM's strategy.

                      budget to support contingency plans
        9. Senator Dole. General Abizaid, the military services are
    transforming and investing heavily towards the next generation of
    capabilities. Yet less than 5 percent of the procurement and research,
    development, test, and evaluation (RDT&E) budget, across the Services,
    is dedicated to strategic lift. Our national military strategy requires
    our forces to be capable of rapidly deploying and operating in multiple
    theaters at varying levels of conflict. As the supported commander, do
    you believe the DOD budget request sufficiently resources and programs
    strategic lift to support your contingency plans?
        General Abizaid. The vast expanse and distance from our homeland,
    coupled with an immature logistical infrastructure in the CENTCOM AOR,
    presents unique challenges when conducting even the most simple
    operations, let alone responses to an emerging crisis. Adequate lift
    capacity capable of closing the force rapidly within the timelines
    dictated by both planned and unplanned responses always remains a
    concern for any commander. Adequate strategic lift has been the focus
    of the Department's budget submission in the past, and is being
    addressed in the future budget planning. I'm confident that recent
    events in the CENTCOM AOR have helped to focus the Department on the
    importance of strategic lift to a commander operating at great
    distances from our homeland infrastructure, and the right emphasis will
    be in place to assure our capability to rapidly and efficiently deploy
    our forces anywhere, anytime, and in sufficient strength to accomplish
    the mission, now and in the future.

        [Whereupon, at 12:50 p.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                            THURSDAY, MARCH 11, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

                                MISSILE DEFENSE

        The committee met, pursuant to notice, at 9:34 a.m., in
    room SR-325, Russell Senate Office Building, Senator John
    Warner (chairman) presiding.
        Committee members present: Senators Warner, Inhofe, Allard,
    Sessions, Dole, Levin, Lieberman, Reed, Akaka, Bill Nelson, Ben
    Nelson, Dayton, Bayh, Clinton, and Pryor.
        Committee staff member present: Judith A. Ansley, staff
    director.
        Majority staff members present: Charles W. Alsup,
    professional staff member; and Brian R. Green, professional
    staff member.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; Madelyn R. Creedon, minority
    counsel; Kenneth M. Crosswait, professional staff member; and
    Richard W. Fieldhouse, professional staff member.
        Staff assistants present: Michael N. Berger, Nicholas W.
    West, and Pendred K. Wilson.
        Committee members' assistants present: J. Mark Powers,
    assistant to Senator Inhofe; Jayson Roehl, assistant to Senator
    Allard; Arch Galloway II, assistant to Senator Sessions;
    Frederick M. Downey, assistant to Senator Lieberman; Elizabeth
    King, assistant to Senator Reed; Peter A. Contostavlos and
    Caroline Tess, assistants to Senator Bill Nelson; Eric Pierce,
    assistant to Senator Ben Nelson; Andrew Shapiro, assistant to
    Senator Clinton; Terri Glaze, Randy Massanelli, and Nathan
    McCarroll, assistants to Senator Pryor.

                OPENING STATEMENT OF SENATOR JOHN WARNER

        Chairman Warner. Good morning everyone. The committee meets
    this morning to seek testimony on the fiscal year 2005
    ballistic missile defense budget request that was made by the
    President. I was very pleased to schedule this hearing at the
    request of my distinguished ranking member, Senator Levin,
    Senator Akaka, Senator Allard, and others who are, like myself,
    very concerned that this program receives the strongest of
    oversight but hopefully the strongest of support by the
    committee, and indeed by the full Senate.
        We welcome our witnesses today, Acting Under Secretary of
    Defense for Acquisition, Technology, and Logistics, Mike Wynne;
    Director of Operational Test and Evaluation (DOT&E), Thomas
    Christie; Commander of U.S. Strategic Command (STRATCOM),
    Admiral James O. Ellis; Director of the Missile Defense Agency
    (MDA), General Ronald T. Kadish; and the Commander of the
    Army's Space and Missile Defense Command, General Larry J.
    Dodgen. I thank each of you for finding the opportunity to join
    with us here this morning.
        Protecting our Nation, our allies, our friends, and
    foremost, our troops deployed overseas from a very real threat
    of ballistic attack is an urgent national defense priority. The
    need for effective missile defenses could not be clearer,
    whether it is here at home or abroad. Dozens of nations already
    have short- and medium-range ballistic missiles in the field
    that threaten U.S. interests, military forces, allies, and
    friends, and others are seeking to acquire similar
    capabilities, including missiles that could reach the United
    States.
        The importance of our missile defense was forcefully
    demonstrated during Operation Iraqi Freedom (OIF). Iraqi
    military forces fired more than 20 ballistic missiles at
    coalition forces. The Patriot Air and Missile Defense System
    engaged nine of those missiles that were aimed at valuable
    targets. All nine threat missiles were destroyed in flight.
    There is no debate about the success of these engagements.
        No coalition soldiers and citizens within coalition nations
    were hurt in any of these ballistic missile attacks. The
    systems simply work, for which we are very grateful to all of
    those who have spent so many years of their lives doing
    research and development (R&D) to prepare them.
        On December 17, 2002, President Bush reiterated his
    commitment to defend our Nation from these types of attacks:
    ``The new strategic challenges of the 21st century require us
    to think differently, but they also require us to act. The
    deployment of missile defenses is an essential element of our
    broader efforts to transform our defense and deterrence
    policies and capabilities to meet the new threats we face.
    Defending the American people against these new threats is my
    highest priority as commander in chief, and the highest
    priority of my administration.''
        On that date, the President announced that he would be
    directing the Secretary of Defense to proceed with fielding an
    initial set of missile defense capabilities to begin operations
    in 2004 and 2005.
        I strongly support the President's decision. I will
    withhold the balance of my statement such that we can get under
    way with this hearing. Senator Levin, do you have a few opening
    comments, and then Senator Allard?

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman. Let me join you in
    welcoming all of our witnesses here this morning. This hearing
    is important for a number of reasons. First, the magnitude of
    the fiscal year 2005 budget request for missile defense is
    truly staggering. The total request is more than $10 billion
    and that's for 1 fiscal year.
        Of that amount, more than $9 billion is for what the
    Pentagon calls the Ballistic Missile Defense System (BMDS). As
    far as I know, that is the largest single year funding request
    for any weapons system in history. The majority of this funding
    is in pursuit of a rudimentary and uncertain defense against
    the unlikely long-range missile attack.
        To put the missile defense budget request in perspective,
    this request is close to twice the entire 2005 budget request
    for U.S. Customs and Border Protection and the Department of
    Homeland Security (DHS), the program dedicated to keeping would
    be terrorists out of our country. The missile defense request
    has more than doubled the next largest annual request for a
    weapons system, the F-22 fighter jet. It is more than the
    entire annual R&D budget of the United States Army.
        One reason this hearing is important is to try to
    understand the justification for this record breaking budget
    request for missile defense. How will this missile defense help
    keep this country safe from terrorist threats that we know
    exist right now? If we spend this money, will we actually get
    an effective defense for this country, or will we get instead a
    system that was rushed to the field prematurely that will have
    to be fixed repeatedly at additional costs as operational tests
    reveal significant problems?
        That brings us to the second reason that this hearing is
    important. The administration plans to deploy a national
    missile defense system in September of this year, just 6 short
    months away. That is despite the fact that the last major test
    of the system was more than 1 year ago, and that test was a
    failure.
        Then inexplicably, seven of the eight intercept tests of
    the system that had been scheduled for 2003 and 2004 have
    either been canceled or have been delayed until next year. The
    plan to deploy in September, however, remains, despite the fact
    that only one of the intercept tests which were to occur before
    deployment is still planned, and even that test will be a well-
    scripted event in which the system's radar will not be
    functioning. Instead, the target itself will broadcast its
    position to the BMDS. A real enemy missile heading towards the
    United States will not be broadcasting its position to us.
        The administration plans to deploy in September despite
    known problems with the interceptor, problems that could affect
    the interceptor's ability to track the target and hit it. This
    is according to the most recent report of the Pentagon's chief
    tester, Tom Christie, who is with us today.
        General Kadish has said that he plans to fix the
    interceptor problems and increase the realism of national
    missile defense testing in future years, but only after we buy
    a large number of missiles and deploy them. History shows how
    essential realistic tests are, and the system the
    administration plans to deploy in September will have completed
    no realistic tests. Zero.
        The administration's missile defense plans are at odds with
    longstanding acquisition laws. These common sense laws require
    major weapons systems to be independently tested under
    combatlike conditions prior to going into mass production and
    being deployed to our troops. Collectively known as fly before
    you buy.
        The laws reflect fundamental principles of good government
    and are intended to protect the safety of our military
    personnel and our Nation, as well as the taxpayers' money. The
    heart of these laws is the requirement to do operational
    testing prior to full-time production of a weapons system. By
    law, operational tests must be conducted under realistic combat
    conditions by typical military users. That is to ensure that
    the system actually works when needed, rather than simply in an
    artificial test environment.
        The missile defense tests to date have all been
    developmental tests which need not be conducted under realistic
    combat conditions. In fact, the missile defense tests have not
    been.
        According to Mr. Christie's latest report to Congress,
    testing of the national BMDS is still needed under more
    combatlike conditions, using the full system rather than just
    individual parts of it. Testing is also needed against targets
    which look more like actual threat missiles and are not already
    preprogrammed into the missile defense system's computer.
        Unlike the developmental tests conducted to date, the law
    requires that operational tests must be approved and overseen
    by Mr. Christie, the Pentagon's independent test authority. Why
    is it important that the Pentagon's independent test authority
    oversee and approve the operational tests that must
    successfully be completed prior to giving the go ahead to full
    rate production of a weapons system? Because this is the only
    way a military program can be judged by an expert who is
    independent of the program, who therefore is at liberty to tell
    the unvarnished truth about the program's successes or
    failings.
        Developmental testing by contrast is conducted by the
    program's contractors and managers who clearly have a
    considerable financial and other stake in the future of the
    program. Their careers may depend on the program's success.
    Many Pentagon programs have sailed through in developmental
    tests with glowing results reported by the contractor, but when
    the time comes for operational testing, serious problems are
    suddenly revealed by the DOT&E.
        The whole point of operational testing is to fix those
    problems prior to buying and deploying the system. Operational
    testing is one of the major reasons the U.S. military is second
    to none. Last year, the administration requested billions of
    dollars to begin to field a largely untested missile defense in
    September, consisting of 20 interceptor missiles as a
    rudimentary defense capability.
        The administration acknowledged that this initial
    capability would not be robust, but said that the 20
    interceptors were part of a missile defense test bed. At a
    missile defense hearing 1 year ago, administration witnesses,
    including General Kadish, Mr. Christie, and Secretary Aldridge,
    who held Secretary Wynne's position at the time, all said that
    one of the reasons for deploying these 20 interceptors starting
    this September was to conduct more realistic tests of the
    system.
        Secretary Aldridge assured us at the hearing that ``the
    reason we have the test bed and we are developing the test bed
    is to enable operational testing.''
        One year later, operational tests still have not been
    performed on the system and apparently none are planned soon,
    yet the administration has requested more than half a billion
    dollars in 2005 to begin buying 20 additional interceptor
    missiles, over and above the 20 that they plan to deploy in
    September.
        Some of these additional 20 interceptors are to be deployed
    at a new unspecified missile defense site and all of this with
    no near-term plans for realistic operational testing of the
    first 20 interceptors.
        It is dubious enough to buy and field 20 largely untested
    intercepters as part of a test bed and claim that something is
    better than nothing as the administration did last year. It is
    plain wrong and in violation of our procurement laws to
    continue to buy another 20 of these missiles as fast as
    possible in what is clearly a full production mode.
        It is not clear to me how racing to build and deploy 40
    missile defense interceptors in multiple deployment sites
    without successfully completing operational tests to the system
    is consistent with the provisions of the fly before you buy
    procurement laws.
        If we approve another 20 missiles this year, without
    demanding operational tests in accordance with common sense and
    with the law, what would prevent the administration from asking
    for another 20 next year and another 20 the year after that. If
    we don't demand realistic operational tests of this system now,
    when will we? How many more billions of dollars should we spend
    on this system prior to knowing whether it will really work
    against a real threat?
        Finally, Mr. Chairman, I'd like to just briefly review the
    track record of the only missile defense system that has ever
    seen actual battle, the Patriot system. I think this track
    record shows clearly why the common sense notions of the fly
    before you buy laws are so important. The Patriot missile
    defense was rushed to the front lines of the 1991 Gulf War amid
    much fanfare but with virtually no testing against ballistic
    missiles.
        Pentagon claims of extraordinary high success rates against
    Iraqi SCUD missiles proved hollow when it became clear that
    most of the supposed intercepts were actually Patriot missiles
    blowing themselves up in futility as the SCUD missile warhead
    continued to the ground only to explode there as designed.
        One of the SCUDs missed by the Patriot system destroyed a
    U.S. military barracks in Saudi Arabia, killing 28 Americans.
    Following the Gulf War, the Pentagon labored for years on an
    improved version of the Patriot, the PAC-3, which was
    specifically designed for SCUDs.
        Between 1997 and 2001, a string of 10 developmental tests
    were conducted, run by the contractor and overseen by the
    Patriot program manager. These tests were almost all
    ``completely successful'' because they were so easy and
    unrealistic. Then it was time for operational testing. Combat
    realistic testing approved and overseen by the Pentagon's
    independent test authority, with actual Army soldiers, not
    contractors, at the Patriot controls.
        Operational tests ran from February to May of 2002, and at
    every single operational test, a major Patriot failure
    occurred. Out of the seven targets launched, only three were
    hit. One Patriot missile missed a cruise missile target, one
    missed a ballistic target, and two Patriots failed to launch
    all together. The problems discovered in operational tests were
    severe and would have seriously degraded the performance of
    Patriot in an actual battle.
        Because of rigorous testing, major problems were fixed just
    in time for the new Patriots to see action in OIF. Even with
    rigorous operational testing, there were still failures with
    the Patriot, which was involved in three friendly fire
    incidents which killed three coalition airmen, but the Patriot
    performance would have been calamitous without the operational
    tests.
        The story of the Patriot shows that if we want an effective
    weapons system, be it missile defense or any other system,
    rigorous, independent, operational testing is absolutely
    essential. Our laws require it. Common sense demands it. Our
    commitment to our military personnel and the taxpayer call for
    it, and not to do so will surely waste money if the system is
    ever called to battle, it could result in a far greater tragedy
    than just the loss of resources and funds. Thank you, Mr.
    Chairman.
        Chairman Warner. I feel that I have to go back into the
    opening statement which I put in the record, because I gave
    detailed accounts of the experience here in this country on
    this issue of testing, which is a legitimate issue. I want to
    point out that this will not be the first time a defense system
    in development has been used for operational purposes prior to
    completion of testing.
        There are many examples of such uses in the past driven by
    an urgent need. Some of these examples are well-known, two
    Joint Surveillance and Target Attack Radar System (JSTARS)
    aircraft flew hundreds of hours of combat missions during the
    1991 Persian Gulf War, and provided warning to our forces on
    the ground when the Iraqi Army was on the move. They were
    preproduction aircraft that had not even started operational
    test evaluation.
        Indeed, in the wake of the outstanding performance of
    JSTARS during the 1991 conflict, our committee increased the
    administration's request for JSTARS aircraft long prior to
    completion of operational tests and evaluation.
        More recently, the Predator and Global Hawk unmanned aerial
    vehicles (UAVs) have proven to be valuable assets to our forces
    during the global war on terrorism. Our military put these
    assets in the field in Afghanistan even though the Predator
    failed its operational evaluation, and the Global Hawk had not
    yet started its operational evaluation.
        Senator Levin. Mr. Chairman, in my humble opinion in all of
    those cases operational testing was planned at the time it was
    fielded, and it was carried out. That is not present now. We do
    not have the plans for operational testing for this system.
        Chairman Warner. We will start off this morning, I think,
    with Mr. Christie. Is that the desire? Or is it Mr. Wynne? What
    is preferable? Mr. Wynne, would you lead off.

     STATEMENT OF HON. MICHAEL W. WYNNE, ACTING UNDER SECRETARY OF
           DEFENSE FOR ACQUISITION, TECHNOLOGY, AND LOGISTICS

        Mr. Wynne. Thank you, Mr. Chairman. Good morning, Mr.
    Chairman, Senator Levin, members of the committee. Thank you
    for the opportunity to appear before you today to discuss the
    fiscal year 2005 Department of Defense (DOD) Missile Defense
    Program.
        The National Missile Defense Act of 1999 established the
    policy of the United States to deploy as soon as possible an
    effective national missile defense system capable of defending
    the territory of the United States against limited ballistic
    missile attack.
        The President more recently directed the Department to
    begin fielding missile defense capabilities in 2004. I am
    pleased to report to you today that we are on track to deliver
    a useful ground-based Ballistic Missile Defense (BMD)
    capability later in 2004. The initial capability of this system
    will likely be limited, but will still be a dramatic
    improvement over our current condition of being defenseless
    against ballistic missile attack.
        The system will have been tested against postulated
    ballistic missile attack scenarios and evaluation of its
    military utility assessed. The MDA continues to incorporate
    increasing realism and operational factors in the test program.
    The test program for 2004 and 2005 will have target geometries
    and test conditions which approximate the most plausible
    operational attack scenarios.
        The plan and budget for 2005 and 2006 reflects a good
    balance between added testing, replication of test articles,
    and maintenance of a warm line for missiles, as well as plans
    for future deployment.
        The flexibility derived from the Secretary's direction on
    this program has enabled the Director of the MDA to make
    programmatic moves that make the fielding of initial ballistic
    missile defense capabilities possible. Congress has been
    concerned that the Department will provide proper oversight of
    this effort.
        I have examined this oversight structure and am confident
    that it facilitates the decisive action needed while providing
    extensive and frequent insight to senior Department leaders and
    to Congress.
        In my role of managing the defense acquisition process, I
    ensure that key DOD stakeholders are involved in the process
    leading to programmatic decisions. I solicit the advice and
    support of the various DOD interests represented by the Defense
    Acquisition Board members.
        The streamlined oversight process of the Missile Defense
    Program changes the collaborative process, reducing the formal
    reporting to a more informal basis, but retains its essence. I
    meet with and influence the Director in his ongoing management
    role. I have also personally reviewed the systems engineering
    that underlies the missile defense system of systems and the
    testing and simulation methodology in a disciplined use of
    engagement scenarios to proof out components and combinations
    of systems.
        The Joint Requirements Oversight Council (JROC) monitors
    the progress of the development program and concurs with
    missile defense goals and program plans. Members of the Joint
    Theater Air and Missile Defense Organization and STRATCOM
    interact with the MDA in the construct of operational concepts
    for BMD and in the assessment of the system's military utility.
        United States leadership in BMD has encouraged several of
    our allies to join our effort. We have formal agreements with
    the United Kingdom (U.K.) for missile defense cooperation and
    are negotiating with Japan which is investing on its own behalf
    significantly. Australia and Denmark are other nations that are
    asking for cooperative agreements.
        Other nations have expressed a desire to participate. We
    plan to facilitate their participation, which is another aspect
    of the President's defense; missile defense direction.
        We are grateful for the support of Congress, which has made
    this bold effort to field missile defense capabilities
    possible. Congressional approval of the President's request for
    missile defense funding has been absolutely critical to our
    smooth execution of the program and we appreciate your support.
        Thank you for this opportunity to testify before this
    committee. I'd be happy to answer any questions that you might
    have.
        [The prepared statement of Under Secretary Wynne follows:]
                  Prepared Statement by Hon. Michael W. Wynne
        Good morning, Mr. Chairman, Mr. Ranking Member, and members of the
    committee. Thank you for the opportunity to appear before you today to
    discuss the Fiscal Year 2005 Department of Defense (DOD) Missile
    Defense Program and budget submission. I am pleased to provide you this
    update on the progress of the Missile Defense Development Program.
        The National Missile Defense Act of 1999 established that it is the
    policy of the United States to deploy as soon as technologically
    possible an effective National Missile Defense system capable of
    defending the territory of the United States against limited ballistic
    missile attack. Upon taking office, President Bush directed that the
    DOD examine the full range of available technologies and basing modes
    for missile defense that could protect the United States, our deployed
    forces, and our friends and allies. In light of the changed security
    environment following September 11 and the progress made in development
    efforts, the President directed the Department to begin fielding
    missile defense capabilities in 2004.
        During this past year, the Department has been hard at work
    developing the missile defense capabilities that will respond to the
    President's direction. We are using postulated ballistic missile attack
    scenarios to incorporate increasing realism into our test program.
    Although we have encountered and solved a number of technical
    difficulties and can expect further challenges on the path ahead, we
    are on track to deliver a useful ballistic missile defense capability
    later in 2004. That initial capability will likely be limited, but will
    still represent a dramatic improvement over our current condition of
    being defenseless against ballistic missile attack.
        As additional components of our initial configuration are placed in
    service in 2004 and 2005, the effectiveness of the missile defense
    capability will incrementally improve. Further improvements planned for
    2006 and beyond will enhance both the capability of fielded missile
    defense components and the depth of those capabilities. The Ballistic
    Missile Defense (BMD) program differs from the classical major defense
    acquisition program, so our approach to acquisition differs. Rather
    than produce and deploy a fixed ``objective'' missile defense
    configuration to serve its entire operational life, we plan an
    ambitious program of technology insertions and additional fielding
    actions to enhance the capability. Such an approach, implemented in an
    integrated system of systems to provide layered defense, will deepen
    the protection of our Nation, extend protection to allies and friends,
    and keep pace with the developing threat.
        Our confidence in the capabilities we are about to place in service
    is based on an assessment of the performance of individual elements of
    the system and of the overall system during testing conducted
    throughout the development program, supplemented by modeling and
    simulation. As we have progressed in the test program, we have
    incorporated increasing realism and operational factors. The flight
    test program for the remainder of 2004 and 2005 has been structured to
    incorporate target geometries and test conditions which closely
    approximate the most plausible operational attack scenarios. The
    outcome of those tests will yield valuable information for assessing
    the effectiveness of the fielded missile defense system and
    strengthening our confidence in the capability. As we field additional
    elements of the planned Block 2004 configuration, such as the sea-based
    X-band radar in 2005, we also improve our ability to evaluate the
    system. So while the initial capability will be limited, progress in
    fielding the rest of Block 2004 will improve both the capability and
    our ability to test it.
        The flexibility that resulted from the Secretary's direction to
    consolidate BMD development activity within a single program and to
    streamline our oversight process has enabled the Director of the
    Missile Defense Agency (MDA) to make the programmatic moves that make
    the fielding of initial BMD capabilities possible. Congress has been
    rightly concerned that the Department provide proper oversight of this
    effort and that Congress retain its insight into missile defense
    program developments. I have examined the oversight structure and am
    confident that it facilitates the decisive action needed, while
    providing extensive and frequent insight into the program to senior
    Department leaders and to Congress.
        I believe this new approach is proving successful in developing the
    Missile Defense Program. In comparison to other programs, my
    interactions with the Director, MDA, to provide guidance, and my
    interactions with the Secretary, to provide feedback and receive
    guidance, are more direct and generally carried out in face-to-face
    discussions. The success of the program in preparing for initial
    fielding later this year demonstrates the effectiveness of this
    approach. In addition, the Missile Defense Program is setting DOD
    standards for such activities as systems engineering and effective
    testing of complex systems of systems, and we are beginning to apply
    those lessons to other programs.
        The President's budget for fiscal year 2005 fully supports the BMD
    program. It will allow us to complete the fielding of the initial
    defensive configuration, to maintain that configuration both on alert
    and as a test bed, and to proceed with development of future
    improvements to the system. I urge the committee to support the
    President's budget for this important program.
        In my role of managing the DOD acquisition process, I strive to
    ensure that all of the key DOD stakeholders are involved in the process
    leading to programmatic decisions. I solicit the advice and support of
    the various DOD interests represented on the Defense Acquisition Board.
    The streamlined oversight process instituted for the Missile Defense
    Program changes the mechanics of the collaborative process, but retains
    its essence. The extensive, ongoing dialog within the Department on all
    aspects of the Missile Defense Program provides advice and support to
    the Secretary, the Deputy Secretary, the Director of MDA, and me.
        The Missile Defense Support Group (MDSG), playing a key role in
    oversight, has continued to provide beneficial advice and comment to
    the Director of MDA and to me on various aspects of the program. These
    senior, experienced representatives of 15 principals of the Department
    have met 41 times since the MDSG was created in March 2002. They have
    provided advice on various aspects of the development program for the
    integrated BMD system, options for fielding capability, and ways of
    implementing those options. They have also provided valuable advice for
    involving our allies in the Missile Defense Development Program.
    Recognizing the challenge of placing this developmental system into
    operational service, we have added the U.S. Strategic Command
    (STRATCOM) to the MDSG to gain an improved understanding of the
    concerns of the warfighter as we approach the commencement of Initial
    Defensive Operations (IDO). No program in the Department receives more
    scrutiny--either in level or frequency--than the Missile Defense
    Program.
        In addition to the MDSG, engagement between Office of the Secretary
    of Defense (OSD) officials, the Joint Staff, the military services, and
    the MDA is extensive and ongoing. I meet weekly with the Director of
    MDA to address important issues and provide guidance on the way ahead.
    The Director and Principal Deputy of Program Analysis and Evaluation
    (PA&E) have met periodically with the MDA Director and his senior staff
    to develop strategies for fielding missile defense capabilities and to
    resolve other programmatic issues. PA&E's staff monitors the progress
    of the Missile Defense Program, within the framework of the MDSG,
    through the program and budget review process, and by periodic
    engagement with their MDA counterparts.
        The Joint Requirements Oversight Council (JROC) monitors the
    progress of the development program, concurs with MDA's goals and
    program plan, and is satisfied with overall Missile Defense Program
    cost and schedule performance. Members of the Joint Theater Air and
    Missile Defense Organization and STRATCOM interact regularly with MDA
    in the development of operational concepts for BMD and in the
    assessment of the system's military utility.
        The relationship between MDA and the OSD Cost Analysis Improvement
    Group is governed by a formal memorandum of agreement guiding the
    development of cost models and shared databases essential for the
    preparation of cost estimates for the BMD system. This ongoing
    interaction has facilitated the completion of independent cost
    estimates for elements to be fielded in Block 2004.
        The Director of Operational Test and Evaluation (DOT&E) and the
    Service Operational Test Agencies (OTA) are fully engaged with MDA. The
    DOT&E and the leadership of the Service OTAs meet periodically with
    MDA's senior leadership. The Deputy DOT&E has near-daily interaction
    with MDA's senior staff. DOT&E personnel work closely with MDA in the
    development and review of test plans, observation of testing,
    participation in data reviews, and the assessment of results. DOT&E's
    annual reports to Congress are informed by the ongoing exchange between
    DOT&E, the Service OTAs, and MDA.
        The military service acquisition chiefs meet regularly with MDA's
    leaders to resolve issues relating to the ballistic missile defense
    capabilities which will, ultimately, be operated and maintained by the
    Services.
        U.S. leadership in BMD has encouraged several of our allies to join
    the effort. Allied engagement, which was in its infancy a year ago, has
    now taken root. We have entered into a formal agreement with the United
    Kingdom (U.K.) for missile defense cooperation and are negotiating
    agreements with Japan, Australia, and Denmark. Other nations have also
    signaled their desire to participate. We are structuring our efforts to
    facilitate their participation, another aspect of the President's
    missile defense direction.
        We are grateful for the support of Congress, which has made this
    bold effort to field missile defense capabilities possible.
    Congressional approval of the President's requests for missile defense
    funding has been critical to our smooth execution of the program.
    Continued cooperation between the Department and Congress will only
    grow in importance as we execute our mission to provide for the
    national security of the United States. I look forward to continuing
    that cooperation.
        Thank you for this opportunity to testify before the committee. I
    would be happy to answer any questions you might have.

        Chairman Warner. Thank you very much, Mr. Secretary. I
    think at this time, the most orderly presentation, unless you
    have a different view, Secretary Wynne, would be to hear from
    Mr. Christie, and then proceed with our military witnesses. Do
    you agree with that?
        Mr. Wynne. Yes, sir.
        Chairman Warner. Thank you. Mr. Christie.

      STATEMENT OF HON. THOMAS P. CHRISTIE, DIRECTOR, OPERATIONAL
                          TEST AND EVALUATION

        Mr. Christie. Mr. Chairman, Senator Levin, and members of
    the committee, I appreciate this opportunity also to appear
    before you today, to provide you with an update on where we
    stand with respect to testing the BMDS. I continue to strongly
    support the construction and integration of the BMDS test bed.
    This test bed will provide the elements that make up the
    Initial Defensive Operations (IDO) architecture.
        While I am very encouraged by the improved testing
    environment and capability that the BMDS test bed will provide,
    I am even more pleased with an increased emphasis on system
    integration and user involvement that I have seen over the past
    year. STRATCOM and Northern Command (NORTHCOM) are developing
    tactics, techniques, and procedures for operating the system.
        The MDA and the element program offices are making the
    developmental tests progressively more realistic. They are
    ground testing with the available system hardware and software
    and involving soldier operators to the degree possible.
        As I have said in the past, the system must be built before
    we can properly test it, and test it under more realistic
    conditions than our present capability permits. The MDA is
    still building this capability. We have just begun to ground
    and flight-test some of the system components in a tactical
    configuration. General Kadish is restructuring the BMDS testing
    program in 2005 to focus on further characterizing and
    evaluating the performance envelope of the IDO capability.
        This testing will become more operationally realistic in
    that test scenarios will include more complex target
    presentations and engagement scenarios. It also will provide a
    better understanding of the IDO, end-to-end performance
    capability. The MDA continues to be proactive when it comes to
    testing. General Kadish has adopted a test-find-fix-test
    philosophy.
        This approach provides a higher likelihood of finding
    design and workmanship problems early in the program. The
    decision to exploit the test bed elements for an initial
    operational capability has required some substantive changes in
    test planning.
        Test objectives have shifted from demonstrating component
    capabilities to demonstrating integrated system capabilities.
    My staff and I remain involved on a daily basis with the MDA
    and the BMDS element program offices in order to ensure that
    operational test issues are addressed in their testing.
        I have recently sent forward for your review the master
    test plan for the Block 04 BMDS, along with the developmental
    test plans, master plans for the four major elements (global
    missile defense (GMD), Aegis, Airborne Laser (ABL), and
    Terminal High Altitude Area Defense (THAAD)). While statute
    prohibits me from having authority or responsibility for
    developmental testing, we are involved in an advisory role in
    the development of these plans.
        Aegis and GMD are the two primary elements of the test bed
    that will comprise the near-term capabilities of the BMDS IDO.
    In both the GMD and Aegis programs, operational testers are
    involved with ensuring that developmental testing addresses as
    many of the operational objectives as possible.
        The Navy's Operational Test Agency (OTA) is advising the
    Aegis missile defense program on how to make their testing more
    realistic without compromising important developmental test
    goals.
        The GMD program's Combined Test Force effectively
    integrates the operational testers into the program development
    activities and the test design and planning efforts. The
    Service OTAs are working jointly and in concert with my office
    to independently advise the MDA and the GMD Combined Task
    Forces on test plans and are independently evaluating all
    ground and flight test data.
        My office has reviewed and approved the operational test
    objectives for the last three GMD integrated flight tests. The
    OTAs, in close coordination with my office, have developed a
    characterization plan that provides the basis for continuous
    operational assessments of demonstrated the BMDS capability as
    it is baselined in 2004 and for each Block as it matures.
        The MDA has supported this effort. I am pleased with their
    openness and cooperation with my office and the Service OTAs.
    We have agreed on the data sources that will support both the
    MDA and operational capability assessments. This will help
    ensure that the test planning will address both developmental
    and operational objectives.
        The operational test community places less emphasis on
    component level test results, though we agree that such testing
    can provide a robust characterization and insight into
    individual component and subsystem performance. Realistic
    operational testing requires an integration of all internal and
    external system elements, including operators employing
    approved tactics and doctrine in accordance with their training
    to accomplish mission planning and engagement through kill
    assessment.
        When integrated system performance is not confirmed by
    integrated system level testing, the burden of combining
    component performance into system performance falls to models
    and simulations. Modeling and simulation are not a good
    substitute for integrated system testing. However, when
    modeling and simulation are used to provide context to
    integrated system hardware in the loop test, they can help to
    overcome test limitations and give a more complete picture of
    mission capability.
        I feel that the MDA is acting responsibly in using models
    and simulations to estimate system performance, but would
    caution that since the system is still in development, model-
    based estimates will almost always contain uncertainties.
        Fielding the test bed provides an opportunity to gather
    operational data on system performance, safety, survivability,
    reliability, availability, and maintainability. We should
    expect these data to drive system enhancements. The challenge
    will be achieving a defensive posture that is flexible enough
    to accommodate the necessary changes to hardware, software, and
    processes that will be necessary to maintain a highly available
    BMDS, while supporting a comprehensive test program that is
    designed to mature, improve, and demonstrate mission
    capabilities through continued development.
        In summary, let me say that for years, my office has
    advocated more comprehensive developmental testing, leading up
    to realistic operational testing. Specifically, we have
    encouraged programs to do more hardware and software in the
    loop testing early during system integration in order to avoid
    problems typically found during operational testing of complex
    network weapons systems.
        The System Integration Laboratory is being employed by the
    MDA and its elements are addressing this important aspect of
    system maturation. The test bed is adding flexibility and
    complexity to the flight test program that will pay dividends
    in the future.
        The commonality of architectural components between the
    test bed and the operational system poses management
    challenges, but should speed the integration of new
    capabilities as they are confirmed through the testing.
        Mr. Chairman, ladies and gentlemen, my staff and I continue
    to work with General Kadish and his staff to ensure that the
    capabilities and limitations of the BMDS are well characterized
    as the system proceeds in development and testing. This
    concludes my opening remarks and I welcome your questions.
        [The prepared statement of Mr. Christie follows:]
                    Prepared Statement by Thomas P. Christie
        Mr. Chairman, members of the committee, I appreciate the
    opportunity to appear before you today and provide you with an update
    on where we stand with respect to testing the Ballistic Missile Defense
    System (BMDS). I continue to strongly support the construction and
    integration of the BMDS test bed. This BMDS test bed will provide the
    elements that make up the Initial Defensive Operations (IDO)
    architecture. While I am very encouraged by the improved testing
    environment and capability the BMDS test bed will provide, I am even
    more pleased with the increased emphasis on system integration and user
    involvement I have seen over the past year. Strategic Command
    (STRATCOM) and Northern Command (NORTHCOM) are developing tactics,
    techniques, and procedures for operating the system. The Missile
    Defense Agency (MDA) and the element program offices are making the
    developmental tests progressively more realistic. They are ground
    testing with the available system hardware and software and involving
    soldier operators to the degree possible.
        As I have said in the past, the system must be built before we can
    properly test it. The MDA is still building it. We have just begun to
    ground and flight-test some of the system components in a tactical
    configuration. General Kadish is restructuring the BMDS testing program
    in 2005 to focus on further characterizing and evaluating the
    performance envelope of the IDO capability. This testing will be more
    operationally realistic in that test scenarios will include more
    complex target presentations and engagement geometries. It also will
    provide a better understanding of the IDO end-to-end performance
    capability.
        The MDA continues to be proactive when it comes to testing. General
    Kadish has adopted a test-find-fix-test philosophy. This approach
    provides a higher likelihood of finding design and workmanship problems
    early in the program. The decision to exploit the test bed elements for
    an initial operational capability has required some substantive changes
    in test planning. Test objectives have shifted from demonstrating
    component capabilities to demonstrating integrated system capabilities.
    My staff and I remain involved on a daily basis with the MDA and the
    BMDS element program offices to ensure that operational test issues are
    addressed in testing. I have recently sent forward for your review, the
    master test plan for the Block 04 BMDS, along with the developmental
    master test plans for the four major elements (global missile defense
    (GMD), Aegis, the Airborne Laser (ABL), and Theater High Altitude Area
    Defense (THAAD)). While statute prohibits me from having authority or
    responsibility for developmental testing, we are involved in an
    advisory role in the development of these plans. Aegis and GMD are the
    two primary elements of the test bed that will comprise the near term
    capabilities of the BMDS IDO. In both the GMD and Aegis programs,
    operational testers are involved with insuring that developmental
    testing addresses as many of the operational objectives as possible.
    The Navy's Operational Test Agency (OTA) is advising the Aegis missile
    defense program on how to make their testing more realistic without
    compromising important developmental testing goals. The GMD program's
    Combined Test Force effectively integrates the operational testers into
    the program development activities and the test design and planning
    efforts. The Service OTAs are working jointly and in concert with the
    Director of Operational Test and Evaluation (DOT&E) to independently
    advise MDA and GMD Combined Test Forces on test plans, and are
    independently evaluating all ground and flight test data. My office has
    reviewed and approved the operational test objectives for the last
    three GMD integrated flight tests. The OTAs, in close coordination with
    my office, have developed a characterization plan that provides the
    basis for continuous operational assessments of demonstrated BMDS
    capability as it is baselined in 2004 and for each Block as it matures.
    The MDA has supported this effort. I am pleased with their openness and
    cooperation with my office and the Service OTAs. We have agreed on the
    data sources that will support both MDA and operational capability
    assessments. This will help ensure that the test planning will to
    address both developmental and operational objectives.
        The operational test community places less emphasis on component
    level test results, though we agree that such testing can provide a
    robust characterization and insight into individual component and
    subsystem performance. Realistic operational testing requires the
    integration of all the internal and external system elements, including
    operator personnel employing approved tactics and doctrine in
    accordance with their training, to accomplish mission planning and
    engagement through kill assessment. When integrated system performance
    is not confirmed by integrated system level testing, the burden of
    combining component performance into system performance falls to models
    and simulations. Modeling and simulation are not a good substitute for
    integrated system testing. However, when modeling and simulation are
    used to provide context to integrated system hardware in the loop
    tests, they can help to overcome test limitations and give a more
    complete picture of mission capability. I feel that MDA is acting
    responsibly in using models and simulations to estimate system
    performance, but would caution that since the system is still in
    development, model based estimates almost always contain uncertainties.
        Fielding the test bed provides an opportunity to gather operational
    data on system performance, safety, survivability, reliability,
    availability, and maintainability. We should expect these data to drive
    system enhancements. The challenge will be achieving a defensive
    posture that is flexible enough to accommodate the necessary changes to
    hardware, software, and processes that will be necessary to maintain a
    highly available BMDS, while supporting a comprehensive testing program
    that that is designed to mature, improve, and demonstrate mission
    capabilities through continued development.
        In summary, let me say that for years my office has been advocating
    more comprehensive developmental testing, leading up to realistic
    operational testing. Specifically we have encouraged programs to do
    more hardware and software in the loop testing early during system
    integration to avoid problems typically found during operational
    testing of complex networked weapon systems. The system integration
    laboratories being employed by the MDA and its elements are addressing
    this important aspect of system maturation. The test bed is adding
    flexibility and complexity to the flight test program that will pay
    dividends in the future. The commonality of architectural components
    between the test bed and the operational system poses management
    challenges, but should speed the integration of new capabilities as
    they are confirmed through testing. Mr. Chairman, ladies and gentlemen,
    my staff and I continue to work with General Kadish and his staff to
    ensure that the capabilities and limitations of the BMDS are well
    characterized as the system proceeds in development and testing.
        This concludes my opening remarks and I welcome your questions.

        Chairman Warner. I find your remarks very clear, Director.
    I thank you.
        Admiral Ellis.

     STATEMENT OF ADM JAMES O. ELLIS, JR., USN, COMMANDER, UNITED
                        STATES STRATEGIC COMMAND

        Admiral Ellis. Thank you, Mr. Chairman, Senator Levin,
    distinguished members of the committee. It's an honor for me to
    once again appear before you today representing the outstanding
    members of STRATCOM men, women, military, and civilian alike.
        I have submitted a written statement. I ask that that be
    included in the record.
        Chairman Warner. The full statements of all witnesses will
    be made part of the record.
        Admiral Ellis. Thank you, sir. I'm pleased to share the
    panel today with Mr. Wynne, Mr. Christie, Lieutenant General
    Kadish, and Lieutenant General Dodgen. During the past year,
    all of us, together with Ed Eberhart, Commander, NORTHCOM and
    Tom Fargo, Commander, United States Pacific Command (PACOM)
    have worked closely as we develop and exercise a concept of
    operations (CONOPs) that establishes a baseline configuration
    of all global BMD mission elements. This includes active and
    passive defense, as well as offensive operational planning.
        When I came before this committee last April, I reported
    that the new STRATCOM was created first and foremost to provide
    responsive, integrated, and synchronized combat capability and
    support across geographic boundaries.
        Since then, we have made significant progress in all four
    of our newly assigned mission areas, including global strike,
    information operations, communications and intelligence, and
    the coordination and integration of the global BMD
    capabilities.
        This morning, I'm here to report on STRATCOM's role and
    progress in bringing the global BMDS to an initial alert
    status. As Mr. Christie has already noted, and Secretary Wynne
    as well, the Missile Defense Act of 1999 directed us to pursue
    this course, and it was outlined in the presidentially directed
    2002 Unified Command Plan (UCP) Change 2 that assigned STRATCOM
    the role of planning, integrating, and coordinating our GMD
    capabilities.
        As we bring on line the capabilities being developed by the
    MDA, STRATCOM is developing doctrine, CONOPs, and operational
    plans in coordination with our components and other combatant
    commanders. We are defining broad interrelationships between
    the GMD mission and other mission areas such as intelligence,
    surveillance, and reconnaissance (ISR) strike operations, and
    information operations.
        We are refining rules of engagement, planning force
    employment, assessing force readiness, and defining logistic
    support requirements. In short, we are advocating future
    desired missile defense and warning characteristics even as we
    implement the ongoing developmental capabilities as spokesmen
    for all combatant commanders.
        NORTHCOM and PACOM are our principal partners in
    preparation for activation of the IDO capability. I meet and
    talk frequently with Ed Eberhart and Tom Fargo to refine and
    validate our plans. Our commands have participated in a
    continuing series of exercises and ongoing readiness
    assessments.
        You will hear soon from Lieutenant General Larry Dodgen. He
    is my Army component commander and in his role as Commander,
    Army Space and Missile Defense Command, and Army Strategic
    Command (ARSTRAT), he oversees the Army National Guard element
    that will man and employ the Nation's ground-based midcourse
    defense system as it comes into being this year under the
    operational control of the NORTHCOM.
        We continue to work closely with Ron Kadish and his MDA
    staff to identify and develop procedures to share assets that
    must support both ongoing BMDS development and testing as well
    as fully support the alert force.
        The foundation for the global BMD CONOP is a centralized
    plan, led by STRATCOM, operational control appropriately
    maintained by the regional combatant commanders employing their
    assigned forces.
        In coordination with NORTHCOM and PACCOM, STRATCOM will
    ensure that multimission sensors are coordinated to support the
    missile defense mission. We have a long history of managing the
    Nation's early warning sensors and that expertise will be
    applied to the global BMD mission area as well.
        The STRATCOM is also responsible for assessing the military
    utility of the ongoing developmental system and providing the
    combatant commander's view of the military utility of the BMDS
    at IDO in 2004.
        We also will periodically report the combatant commander's
    assessment of the evolving system's capabilities and
    limitations with a focus on three key metrics, effectiveness,
    interoperability, and suitability.
        The Military Utility Assessment (MUA) and the Operational
    Test and Evaluation (OT&E) team, referred to by Mr. Christie,
    share a common database of observations on capabilities and
    limitations derived from system and element testing and
    simulation.
        The IDO capability is the first increment of the
    capabilities-based approach to developing and providing BMD. We
    will take full and early operational advantage of the system's
    anti-missile capabilities under development.
        In fact, moving the initial capability into the operational
    environment provides opportunities for more immediate,
    rigorous, and realistic testing of the system elements, command
    and control processes, and operational crew performance.
        Our written statement outlines the progress we have made
    over the past year and our continuing effort to validate
    operational processes, systems, and capabilities in order to
    successfully achieve IDO in the months ahead.
        As the men and women of STRATCOM support the new constructs
    and processes being developed for operationally testing and
    operationally employing the nascent missile defense system, we
    will gain important operational experience and insight. These
    opportunities will enable us to better shape and refine the
    system as we go through this development process and also
    permit fielding of an IDO capability to further enhance the
    security of the Nation.
        In my mind, this represents an appropriate and realistic
    approach to development of this unique defensive capability of
    unprecedented scope. I thank you for this opportunity to
    discuss these important issues with you, but I look forward to
    your questions.
        [The prepared statement of Admiral Ellis follows:]
               Prepared Statement by ADM James O. Ellis, Jr., USN
                the operationalization of global missile defense
    I. Introduction
        It is my honor to appear before the Senate Armed Services Committee
    today to discuss the role of U.S. Strategic Command (STRATCOM) in
    operationalizing the Global Ballistic Missile Defense (GBMD) system.
        In the words of Secretary Rumsfeld, ``We have truly entered a new
    age--one that may well be the most dangerous America and the
    democracies of the world have ever faced.'' Our ever-increasing
    dependence of space systems, computer technologies, and information
    management systems, combined with the proliferation of weapons of mass
    destruction (WMD) and the threat from continued global terrorism, has
    forever changed the security environment in which we live. The United
    States can no longer know for certain which nation, combination of
    nations, or non-state actors may pose threats to our vital interests.
    Many of the threats we face are global in nature, often operating in
    the seams between national boundaries, political systems, and
    ideologies.
        Clearly, the tragedy of September 11, 2001, demonstrated the
    challenges of ``one-size-fits-all deterrence.'' These attacks led us to
    accelerate the reexamination of how we defend the homeland and further
    served to accelerate ongoing discussions regarding the effectiveness of
    strictly threat-based approaches towards potential adversaries.
        Our changing national security environment demands new ways of
    thinking and a strategy that anticipates capabilities of rogue states
    and non-state actors and seeks to dissuade or deter the action of
    potential adversaries. Preparing for the future requires us to develop
    capabilities that can adapt quickly to new challenges and to unexpected
    circumstances. Tomorrow's conflicts will likely consist of asymmetric
    attacks focused on perceived U.S. vulnerabilities.
        The effects of globalization and the growth of transnational
    threats continue to reshape the Department of Defense's (DOD) thinking
    in all fundamental mission areas. Reflective of this effort, Change One
    to the 2002 Unified Command Plan (UCP) combined the former STRATCOM and
    U.S. Space Command on October 1, 2002.
        Three months later, on January 10, 2003, President Bush assigned
    STRATCOM the responsibility of planning, integrating, coordinating, and
    when directed, executing four previously unassigned mission areas:
    Global Strike, Global Missile Defense (GMD), DOD Information
    Operations, and command and control, computers, communications,
    intelligence, surveillance, and reconnaissance (C\4\ISR). As is the
    case with the traditional missions of nuclear deterrence and space
    operations, this new portfolio of missions transcends geographical
    boundaries.
        Missions that cross regional boundaries require a global approach.
    STRATCOM is specifically tasked to integrate each of those missions in
    support of warfighters around the globe. We believe that integrating
    these capabilities can maximize our Nation's ability to respond to a
    broad range of global threats and contribute significantly to our
    Nation's security.
    II. U.S. Strategic Command's Role in Global Ballistic Missile Defense
        The missile defense mission requires a global approach. Missile
    defense concepts have evolved from separate efforts focused on terminal
    intercept of short- and medium-range ballistic missiles and mid-course
    intercept of intercontinental ballistic missiles, to a multi-layered
    missile defense system contributing to the defense of the U.S., our
    allies, and our forces and interests abroad. Change Two of the 2002 UCP
    tasked STRATCOM to plan, integrate, and coordinate the GMD capabilities
    of the Nation.
        STRATCOM is operationalizing the capabilities being developed and
    deployed by the Missile Defense Agency (MDA). We are leading the
    development of the necessary doctrine, concepts of operations (CONOPs),
    and operational plans in coordination with our subordinate Service
    component commands and the other combatant commands. This effort
    requires that we define the broad interrelationships among the GBMD
    mission and other mission areas, such as intelligence, surveillance,
    and reconnaisance (ISR), strike operations, and information operations.
    Operationalizing GMD capabilities also requires detailed planning to
    address the policy, rules of engagement, force employment, force
    readiness, and logistics support, and tying together diverse system
    elements including sensors, interceptors, and the command and control
    network.
        The UCP also tasks STRATCOM with advocating the desired GMD and
    missile warning characteristics and capabilities as a spokesman for all
    combatant commanders. As the advocate for GBMD, STRATCOM, in
    coordination with our fellow combatant commands, provides direct input
    to the MDA and the DOD requirements process regarding our operational
    and technical views on the system, all aspects of the Ballistic Missile
    Defense System (BMDS) integration, and the desired capabilities for
    future incremental (Block) improvements. Clearly, close cooperation
    between operators and developers is essential. Unequivocally, STRATCOM
    and the MDA have forged a strong relationship over the past 18 months
    affording us the opportunity to shape the program to better represent
    the needs of the combatant commanders and the Nation.
        U.S. Northern Command (NORTHCOM) and U.S. Pacific Command (PACOM)
    are our principal warfighting partners in preparation for activation of
    the initial defensive capability. With them, we are continuing to
    refine and validate our plans in a series of exercises and readiness
    assessments designed to prepare the responsible combatant commands,
    comprised of Army, Navy, and Air Force units, for assuming operational
    responsibility for the initial elements of this nascent defensive
    system. In addition, we are working closely with the MDA to identify
    and develop procedures to share assets that must support both ongoing
    BMDS development and testing as well as the operational alert forces.
        Operation Iraqi Freedom (OIF) demonstrated an unprecedented level
    of cross-theater missile defense cooperation and coordination.
    Integrated early warning data from Army, Navy, Air Force, and other
    intelligence sensors provided vital data supporting Patriot missile
    engagements of all threatening theater ballistic missile launches.
    Expanding upon OIF's example of an integrated and effective defense,
    STRATCOM is developing the global missile defense concept of operations
    and the battle management architecture to provide full capabilities for
    regional combatant commanders to defend their areas of responsibility
    (AOR).
        Concept of Operations
        The foundation for the GBMD CONOPs is centralized planning, led by
    STRATCOM, with decentralized execution by the regional combatant
    commanders (RCCs) employing their assigned forces. This concept of
    operations also achieves unity of effort by placing under STRATCOM the
    overarching responsibility for GBMD.
        STRATCOM synchronizes and integrates all combatant commanders' BMD
    plans into a fully coordinated, cohesive GBMD strategy. The concept is
    designed to minimize operational vulnerabilities, mitigate risk, and
    appropriately set and prioritize resource requirements from a global
    perspective. Additionally, STRATCOM monitors and assesses
    vulnerabilities that may arise in a potential crisis and recommends to
    the Nation's senior civilian leaders courses of action such as the
    reallocation of forces, to mitigate risks to the overall strategy.
        Of the $10.2 billion requested for the missile defense program in
    fiscal year 2005, about $3.2 billion will go to the anti-
    intercontinental ballistic missile (ICBM) portion of the overall
    system--Ground-Based Midcourse Defense. This includes approximately
    $860 million for deployment. Most of the remaining funding will go to
    other elements of missile defense including procurement, upgrades, and
    advanced research on systems such as Theater High Altitude Air Defense
    (THAAD), PAC-3, SM-3, and the Aegis--all systems that provide medium-
    and short-range protection to our troops.
        The Ground-Based Midcourse Defense system is a primary element of
    the BMDS initially designed to protect the 50 United States. STRATCOM's
    component, Army Strategic Command, oversees the Army element that will
    man and employ the Ground-Based Midcourse Defense system. This element
    consists of both the Ground-Based Midcourse Defense Brigade and
    Battalion, under the operational control of NORTHCOM for execution of
    defense of the U.S. and other areas as directed by the President and
    Secretary of Defense. Commander, NORTHCOM will protect Hawaii in
    support of Commander, PACOM. PACOM's primary role in missile defense at
    Initial Defensive Operations (IDO) is the employment of Aegis
    surveillance and tracking capabilities in the Pacific Region to provide
    direct threat tracking support to NORTHCOM's defense of the homeland.
        Command and Control
        The Command and Control Battle Management and Communications
    (C2BMC) system will be integral to the execution of the GBMD mission.
    This system will link combatant commanders, enabling them to share a
    common operational picture and conduct near real-time collaborative
    planning and execution of GMD operations. The C2BMC system provides new
    missile defense displays and will supplement the routine voice
    conferences that have been expanded to address both offensive and
    defensive operations.
        The C2BMC system will be installed at STRATCOM and NORTHCOM in late
    July. During that same installation, PACOM will have access to the
    system's situational awareness displays. The complete suite of command
    and control equipment will be installed in PACOM by December 2005. The
    system, as initially deployed, will provide the essential functionality
    for executing the GBMDS.
        The global focus and reach of STRATCOM's operations have raised
    significant interest among international friends and allies. STRATCOM
    is exploring the implications of future multi-national system
    participation in the missile defense mission area by continuing
    dialogue with our military counterparts including the United Kingdom,
    Australia, Canada, Denmark, and Japan.
        Offense/Defense Integration
        In May 2001, President Bush stated, ``We need new concepts of
    deterrence that rely on both offensive and defensive forces.'' The
    inclusion of active and passive defenses in America's deterrent
    strategy and force posture is a significant departure from past
    strategy. Circumstances have changed profoundly; the threat may be
    numerically smaller, but it is certainly more diverse and less stable.
        Currently, our only defense against an adversary with long-range
    ballistic missile technology is our offensive strike capability.
    Deployment of the BMDS gives our Nation a military capability with
    greater flexibility to assure our friends and allies, adds to the
    deterrent equation, and begins to actively defend and protect our
    interests on a global scale.
        STRATCOM, in coordination with NORTHCOM and PACOM, is refining the
    cross-command procedures for integrating offensive and defensive
    operations. Potential offense response options will include both
    kinetic and non-kinetic conventional weapon systems and information
    operations.
        An active missile defense provides a broader range of options to
    senior leadership decisionmakers while adding additional strategic
    deterrent capability. Integrating these capabilities with responsive
    offensive actions further increases the probability of success in
    countering an adversary's attack.
        Information and Intelligence Support
        A key enabler for GBMD operations is real-time, unambiguous
    intelligence. We are working closely with the DOD's intelligence
    organizations to develop and disseminate necessary intelligence
    information in order to further enhance missile defense capabilities.
        Part of our responsibility is to ensure each combatant commander is
    working from the same intelligence threat assessment baseline. That
    effort will be coordinated by the STRATCOM's Joint Intelligence Center.
    A common intelligence assessment will ensure all combatant commanders
    are planning their active defense, passive defense, sensor positioning,
    readiness levels, and ready attack options to counter a consistent
    threat.
        Enabling capabilities, such as the Defense Support Program (DSP)
    and Space Based Infrared System (SBIRS), will be vital components of
    the development of more advanced missile defense systems. For the
    initial missile defense capability, the on-orbit DSP will provide the
    necessary indications and warning to fully support our operations
    against long-range ballistic missiles. SBIRS will expand our ability
    beyond the current capabilities of the DSP to detect shorter-range
    missiles. Unlike DSP, SBIRS was designed from the outset to support
    both tactical and strategic requirements. DSP and SBIRS, once
    operational, will likely remain the source of the first missile warning
    we receive, and as such, will represent the essential first link in the
    chain of a layered, integrated missile defense.
    III. Training, Exercises, and Readiness Assessment
        To validate operational capabilities, STRATCOM, in coordination
    with NORTHCOM, PACOM, and the MDA, developed a series of exercises
    designed to assess our ability to perform critical tasks for missile
    defense. The series, referred to as Thor's Shield, is part of a
    continuous process designed to ensure readiness and to provide feedback
    to the MDA for development of future capabilities. The combatant
    commanders will use Thor's Shield to incrementally certify their forces
    and exercise GBMD across their AOR at the tactical, operational, and
    strategic levels.
        The initial cadre of the Ground-Based Midcourse Defense Brigade was
    established on October 16, 2003. The subordinate Ground-Based Midcourse
    Defense Battalion was activated in Fort Greeley, Alaska, in January
    2004. The Army National Guard is being trained to operate both units.
    All missile defense crews will complete their initial training by
    summer 2004 and will be certified ready to conduct sustained operations
    by this fall.
        At the tactical level, training and certification for the Ground-
    Based Midcourse Defense Brigade have been in process for over a year.
    At the operational level, PACOM, NORTHCOM, and STRATCOM staffs are
    being trained and will be ready to support IDO. Combatant command
    participation in Thor's Shield will continue to support development of
    the current command and control structure, rules of engagement, and
    other key operational doctrine. This process contributes to developing
    operator competency and proficiency prior to IDO and ensures trained
    operators and a responsive command and control structure will be
    available to meet contingency missions. Of course, user confidence and
    proficiency will continue to grow with increased hands-on training
    experience with the deployed system.
        At the strategic level, in November 2003, we completed a senior
    military and civilian leadership exercise to help formulate key
    national policy guidance. Interim proposed Ground-Based Midcourse
    Defense employment policy guidelines for IDO are currently under final
    review.
        In addition to events dedicated to training, warfighters from
    STRATCOM, NORTHCOM, PACOM, along with their component commands, are
    active participants with the MDA in all Ground-Based Midcourse Defense
    flight and ground tests and wargame exercises. This broad participation
    has proven invaluable in documenting and assessing the military utility
    of the Ground-Based Midcourse Defense System and increasing the
    warfighters' confidence in its system capabilities and performance.
        Military Utility Assessment (MUA)
        STRATCOM is responsible for conducting a MUA of the BMDS. The MUA
    is designed to support two purposes. First, to provide the combatant
    commanders' view of the military utility of the BMDS at IDOs in 2004.
    Second, to provide the combatant commanders' assessment of the BMDS IDO
    capabilities and limitations. These assessments will be derived from
    system and element testing and simulation by the OTAs working for the
    Director of Operational Test and Evaluation (DOT&E). Overall, the MUA
    serves as a report to the Secretary of Defense on the progress made to
    date and the projected utility of the system. STRATCOM and the Joint
    Theater Air and Missile Defense Organization, in coordination with
    NORTHCOM, PACOM, the OTAs, and MDA, will assess the degree to which
    delivered capabilities support execution of the missile defense mission
    with a focus on three key metrics: effectiveness, interoperability, and
    suitability.
        The MUA is an iterative, event-driven process. The initial
    increment of the assessment is based on data available on BMDS
    performance in the September-December 2003 timeframe and provides
    preliminary conclusions on IDO military utility and capabilities and
    limitations at IDO. A more comprehensive assessment of the BMDS
    capabilities for IDO will be based on test events that are executed in
    2004, including both flight tests and ground tests. Additionally, we
    will draw insights from exercises and wargames that employ C2BMC
    elements and guide the development and refinement of operating
    procedures. Confidence in assessed capabilities will improve as more
    system performance data is gathered and analyzed, and future iterations
    of the assessment will be adjusted to match any change in testing or
    schedule.
        The MUA and the assessment of the DOT&E are closely related in that
    they share a common database of observations on BMDS capabilities and
    limitations derived from system and element testing and simulation. The
    information in the database developed by the OTAs provides the
    information critical to the conduct of the MUA process. We rely on the
    expertise within the test community of more than a hundred highly
    skilled data collectors and analysts who utilize an array of analytical
    tools to evaluate system performance and characterize system behavior.
    The warfighter and OTAs have been involved in the collaborative process
    and we continue to influence the development of test objectives through
    close coordination with the developer and the operational test
    community. Working closely with Mr. Christie's team, the developers in
    the MDA, and, importantly, the users of the system in the combatant
    commands and Services, we will quantify system performance and assess
    mission execution, fully mindful of the developmental capabilities and
    limitations identified. We will work closely with the developer to
    define and evaluate any required corrective action. Observations and
    insights on system performance gained from wargames will be added to
    determine whether modifications to tactics, techniques, and procedures
    can further enhance system capabilities.
        Unlike classic OT&E evaluations, the MUA is not assessing the
    system performance against a hard and fast performance threshold. The
    MUA is instead a determination of the extent to which the capability
    provided by a developmental system contributes to mission
    accomplishment and national security even as the system continues to
    evolve and mature.
        The MUA is properly baselined against today's capability--an
    inability to intercept any long-range ballistic missile launched
    against the United States. At IDO, the BMDS is intended to provide a
    rudimentary capability to defend against a limited, long-range
    ballistic missile attack against the United States. We are confident
    that we are on track from both the technical and operational
    perspectives to successfully field and operate an initial BMD
    capability. Further testing, wargames, and exercises in 2004 and beyond
    will provide us with additional data for completing a more in-depth
    assessment.
    IV. Conclusion
        Mr. Chairman, STRATCOM is ready to meet the critical challenges of
    operationalizing all elements of the GBMD system.
        We will be ready to operate an initial defensive capability this
    year. In the years ahead, we will fulfill the Nation's goal of
    deploying a system to defend the United States, our deployed forces,
    and our allies against the full spectrum of ballistic missile threats.
    This global system will ultimately deliver a military capability we
    currently do not have to defend the Nation. When fully fielded, this
    capability will increase the operational flexibility of our forces and
    dramatically increase the range of options available to our national
    leadership. Future advances will have great potential to similarly
    protect and assure our allies. In the face of adversaries seeking more
    sophisticated means to threaten our Nation, we must continue to pursue
    and rigorously assess evolutionary capabilities in order to further
    improve our BMD.
        We are mindful of the magnitude of the task before us, but remain
    confident in the talent of our staff, components, and industry and
    agency mission partners. Ours is a very different time, fraught with
    very different challenges. In the words of Abraham Lincoln, ``The
    dogmas of the quiet past are inadequate to the stormy present. The
    occasion is piled high with difficulty, and we must rise with the
    occasion. As our case is new, so we must think anew, and act anew.''
        I appreciate your continued support of the men and women of
    STRATCOM and the unique and essential contributions they continue to
    make to safeguard our Nation. I look forward to reporting our progress
    to you in the future, and I welcome your questions.

        Chairman Warner. Admiral, we thank you for your long
    distinguished service to our Nation, and particularly in this
    role that you are now playing.
        General Kadish.

    STATEMENT OF LT. GEN. RONALD T. KADISH, USAF, DIRECTOR, MISSILE
                             DEFENSE AGENCY

        General Kadish. Good morning, Mr. Chairman, Senator Levin,
    and members of the committee. Today I'd like to briefly
    summarize some key points of the fiscal 2005 budget submission
    that we have before you.
        Our direction from the President is to develop the
    capability to defend the United States, our allies, friends,
    and deployed forces against all ranges of missile in all phases
    of flight. Beginning in 2001, we proposed development of a
    single integrated BMDS, and we are building over time layered
    defenses to enable engagements in all of those phases against
    all of those ranges, and make it possible to have a high degree
    of confidence in the performance of the missile defense system.
        Our program is structured to deal with the enormity and
    complexity of this task. Our budget request continues to
    implement that guidance in two ways. First, it continues an
    aggressive research, development, test, and evaluation (RDT&E)
    effort to design, build, and test elements of a single
    integrated BMDS in an evolutionary way.
        Second, it provides for a modest fielding of this
    capability over the next several years so that we can rapidly
    improve our capability in the field.
        We are requesting $9.2 billion to support this program and
    work in fiscal year 2005, which is approximately a $1.5 billion
    increase over the fiscal year 2004 request.
        Now, about $1 billion covers costs associated with the
    continued fielding of the test bed and the first ground-based
    midcourse defense in Aegis and sensors and command and control
    and battle management equipment that make that up. Also, for
    the Block 4 alert configuration.
        About $500 million of that amount will allow us to purchase
    long lead items for further improvements beyond the test bed,
    in an evolutionary capability improvement for what we call
    Block 6. In other words, about $1.5 billion in fiscal year 2005
    request supports the initial configuration of the test bed and
    activities to place the BMD system on alert initially, and for
    systems improvements in block 2006. About $7.7 billion lays the
    RDT&E foundation for the continued evolution of the system to
    include a significant amount of testing.
        This budget is consistent with the approach I have
    described in many previous years. Last year, we made it clear
    that this initial capability inherent in the test bed would be
    very basic. We also emphasize that instead of building a test
    bed that could be used in an emergency, we would field this
    year more interceptors, put them on alert and continue to test.
    As of today, despite some setbacks, we are on track to do just
    that.
        So with an evolutionary capabilities-based acquisition
    approach, and our aggressive RDT&E program, we can put together
    a capability to put in the field, to test it realistically, to
    train with it, to get comfortable with it, learn what works
    well, learn what doesn't, and improve it over time as rapidly
    as we can.
        This is a unique, unprecedented capability in its early
    stages that we will continue to mature. We have to strike a
    balance between our need to continue to test and develop
    missile defenses and our goal to provide effective defenses
    where there are none today. I believe we have struck that
    balance in this budget, and we can do both of those things
    starting this year.
        We are working with Admiral Ellis and the warfighting
    community, as he said, to ensure that we can do both of those
    efforts: RDT&E and operations. Once the system is placed on
    alert, we will continue to conduct tests concurrently to gain
    ever greater confidence in this operational capability.
        We are working very closely with Mr. Christie and the
    operational test community. As our tests are planned, executed
    and evaluated, the BMDS Combined Test Force, which brings
    together representatives from across the testing community, is
    combining requirements for both developmental and operational
    testing capability. There are approximately 100 operational
    test personnel, full-time embedded in all facets of missile
    defense test planning and execution who have access to all of
    our test data. They have the ability to influence every aspect
    of our test plan.
        The missile defense test program helps define the
    capabilities and limitations of the system. The thousands of
    tests we conduct in the air, on the ground, and in the
    laboratory and with our models and simulations help identify
    problems so we can fix them and they highlight gaps so that we
    can address them.
        This accumulated knowledge has and will continue to
    increase our confidence in the overall performance of the
    system and its potential improvements. The research and
    development program is working. We have focused on the
    development of the most promising near-term elements, namely
    the ground-based midcourse system and Aegis BMD. THAAD is
    progressing well and will add capabilities to engage in late
    midcourse and terminal layers.
        Achieving a capability in a boost phase as soon as we
    practically could would be a revolutionary high payoff
    improvement to this layered system. In this budget we increase
    investment in the development of that boost layer. Two program
    elements, a directed energy ABL capability and a new kinetic
    energy or hit to kill capability in the boost phase represent
    parallel paths complementary to each other, but significantly
    different technologies.
        Interest among foreign governments and industry in missile
    defense has risen absolutely and considerably over the past
    year. Because geography and allied partnerships really do
    count, we are undertaking major initiatives in the
    international arena in this budget. We will begin in 2005 to
    expand international involvement in the program by encouraging
    foreign industry participation and investment in the
    development in the complementary boost and ascent phase of
    element component development. Our international work is a
    priority that is consistent with the President's direction, our
    vision and supportive of our overall goals.
        In particular, in December 2003, the Government of Japan
    became our first ally to announce its intent to invest more
    than $1 billion in the development in the multilayered BMD
    system, basing its initial capability on upgrades to their
    Aegis destroyers and acquisition of SM-3 and Patriot-3 (PAC-3)
    missiles. We have also concluded important agreements with the
    U.K.
        Mr. Chairman, thanks to the tens of thousands of talented
    and dedicated people across this country, America's Missile
    Defense Program is on track.
        The MDA is doing what we told Congress we would do, and
    your support has been absolutely critical to the progress we
    have made. We have listened to your concerns over the years and
    sought to address them in a responsible manner. Our tests and
    analyses will give us the confidence that we can take these
    first steps toward initial defensive operations while we
    continue to prove out new technologies and increase the
    confidence in the system to realistic testing.
        I continue to believe there is tremendous benefit in
    putting the unprecedented technology that we have today into
    the field in manageable increments to provide some defenses
    where none exist today, to learn more about it, to gain
    experience with it, to test it more realistically and
    ultimately to improve it as fast as we can.
        Thank you, Mr. Chairman.
        [The prepared statement of General Kadish follows:]
             Prepared Statement by Lt. Gen. Ronald T. Kadish, USAF
        Good morning, Mr. Chairman, members of the committee. It is an
    honor to be here today to present the Department of Defense's (DOD)
    Fiscal Year 2005 Missile Defense Program and budget.
        Today, I would like to outline what we are doing in the program,
    why we are doing it, and how we are progressing. I also will address
    why we proposed taking the next steps in our evolutionary development
    and fielding program. Then I want to emphasize the importance of the
    acquisition strategy we are using and close with some observations
    about testing and the Department's approach to Missile Defense Agency
    (MDA) management.
        Our National Intelligence Estimates (NIEs) continue to warn that in
    coming years we will face ballistic missile threats from a variety of
    actors. The recent events surrounding Libya's admission concerning its
    ballistic missile and weapons of mass destruction (WMD) programs remind
    us that we are vulnerable. Ballistic missiles armed with any type
    warhead would give our adversaries the capability to threaten or
    inflict catastrophic damage.
        Our direction from the President is to develop the capability to
    defend the United States, our allies and friends, and deployed forces
    against all ranges of missiles in all phases of flight. This budget
    continues to implement that guidance in two ways.
        First it continues an aggressive research, development, test, and
    evaluation (RDT&E) effort to design, build, and test the elements of a
    single Ballistic Missile Defense (BMD) system in an evolutionary way.
    Second, it provides for modest fielding of this capability over the
    next several years.
        We recognize the priority our Nation and this President ascribe to
    missile defense, and our program is structured to deal with the
    enormity and complexity of the task. The missile defense investments of
    4 administrations and 10 Congresses are paying off. We are capitalizing
    on our steady progress since the days of the Strategic Defense
    Initiative (SDI) and will present to our combatant commanders by the
    end of 2004 an initial missile defense capability to defeat near-term
    threats of greatest concern.
                        ballistic missile defense system
        Layered defenses help reduce the chances that any hostile missile
    will get through to its target. They give us better protection by
    enabling engagements in all phases of a missile's flight and make it
    possible to have a high degree of confidence in the performance of the
    missile defense system. The reliability, synergy, and effectiveness of
    the BMD System (BMDS) can be improved by fielding overlapping,
    complementary capabilities. In other words, the ability to hit a
    missile in boost, midcourse, or terminal phase of flight enhances
    system performance against an operationally challenging threat. See
    Chart 1.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        All of these layered defense elements must be integrated. There
    must be a battle management, command, and control system that can
    engage or reengage targets as appropriate. It all must work within a
    window of a few minutes. We believe that a layered missile defense not
    only increases the chances that the hostile missile and its payload
    will be destroyed, but it also can be very effective against
    countermeasures and must give pause to potential adversaries.
        So, beginning in 2001 we proposed development of a joint,
    integrated BMDS. Yet such unprecedented complexity is not handled well
    by our conventional acquisition processes. At that time, the Services
    had responsibility for independently developing ground-based, sea-
    based, and airborne missile defenses. The Department's approach was
    element- or Service-centric, and we executed multiple Major Defense
    Acquisition Programs (MDAPs).
        Today, as a result of DOD transformation and a streamlined process
    instituted by the Secretary of Defense in 2001 to enhance overall
    integration, we are managing the BMDS as a single MDAP instead of a
    loose collection of Service-specific autonomous systems. We have come
    to understand over the years, though, that no one technology, defense
    basing mode, or architecture can provide the BMD protection we need.
    Redundancy is a virtue, and so we established a system-centric approach
    involving multiple elements designed, developed, and built with full
    integration foremost in our minds. When we made this change, we
    instituted a ``capability-based'' acquisition process instead of a
    ``threat-based'' process. Let me explain why this is important.
        Most defense programs are developed with a specific threat--or
    threats--in mind. Twenty years ago, the ballistic missile threat was
    pretty much limited to Soviet intercontinental ballistic missiles
    (ICBMs) and sea-launched ballistic missiles. But today we have to
    consider a wide range of missile threats posed by a long list of
    potential adversaries. Those threats are constantly changing and
    unpredictable. Our potential adversaries vary widely in their military
    capabilities and rates of economic and technological development. Many
    of them have a tradition of political instability.
        Weapon systems developed using a threat-based system are guided and
    governed by Operational Requirements Documents (ORDs). These documents
    establish hard thresholds and objectives for the development and
    deployment of every component. ORDs may be entirely appropriate for
    most development programs because they build linearly on existing
    systems. For example, aircraft program managers understand lift and
    thrust from previous programs going all the way back to the Wright
    brothers.
        Not so for missile defense. Most missile defense development takes
    place in uncharted waters. Any ORD developed for an integrated, layered
    missile defense system would be largely guesswork. ORDs rely on very
    precise definitions of the threat and can remain in effect for years,
    making this process all the more debilitating for the unprecedented
    engineering work we are doing. The reality that we may have to
    introduce groundbreaking technologies on a rapid schedule and also deal
    with threats that are unpredictable render the threat-based acquisition
    structure obsolete.
        A capability-based approach relies on continuing and comprehensive
    assessments of the threat, available technology, and what can be built
    to do an acceptable job, and does not accommodate a hard requirement
    that may not be appropriate.
        Perhaps the most telling difference between the two acquisition
    approaches is that our capabilities to perform are updated every 4 to 8
    months to reflect and accommodate the pace of our progress. We are no
    longer compelled to pursue a 100-percent solution for every possible
    attack scenario before we can provide any defense at all. We are now
    able to develop and field a system that provides some capability that
    we do not have today with the knowledge that we will continue to
    improve that system over time. We call this evolutionary, capability-
    based development and acquisition.
                  initial defensive capability--the beginning
        On December 16, 2002, President Bush directed that we begin
    fielding a missile defense system in 2004 and 2005. The President's
    direction recognizes that the first systems we field will have a
    limited operational capability. He directed that we field what we have,
    then improve what we have fielded. The President thus codified in
    national policy the principle of evolutionary, capability-based
    acquisition and applied it to missile defense.
        The President's direction also builds on the 1999 National Missile
    Defense Act. Under this act, deployment shall take place ``as soon as
    technologically possible.'' The fact is that BMD has proven itself
    technologically possible. Not only have most of the well-publicized
    flight tests been successful, but so have the equally important
    computer simulations and software tests. Those tests and upgrades will
    continue for a long time to come--long after the system is fielded and
    long after it is deemed operational. After all, this is the heart of
    evolutionary, capability-based acquisition. This is not a concept
    designed to trick or mislead. It is simply the logical response to the
    following question: Defenseless in the face of unpredictable threats,
    which would we rather have--some capability today or none as we seek a
    100-percent solution?
        When we put the midcourse elements (Global Missile Defense (GMD)
    and Aegis BMD) of the BMD system on alert, we will have a capability
    that we currently do not have. In my opinion, a capability against even
    a single reentry vehicle has significant military utility. Even that
    modest defensive capability will help reduce the more immediate threats
    to our security and enhance our ability to defend our interests abroad.
    We also may cause adversaries of the United States to rethink their
    investments in ballistic missiles. Because of this committee's
    continued support, we will have some capability this year against near-
    term threats.
        I must emphasize that what we do in 2004 and 2005 is only the
    starting point--the beginning--and it involves very basic capability.
    Our strategy is to build on this beginning to make the BMDS
    increasingly more effective and reliable against current threats and
    hedge against changing future threats.
        We have made significant strides towards improving our ability to
    intercept short-range missiles. Two years ago we began sending Patriot
    Advanced Capability 3 (PAC-3) missiles to units in the field. Based on
    the available data, the Patriot system, including PAC-3, successfully
    intercepted all threatening short-range ballistic missiles during
    Operation Iraqi Freedom (OIF) last year. Today, it is being integrated
    into the forces of our allies and friends, many of whom face immediate
    short- and medium-range threats. We believe it is the only combat-
    tested missile defense capability in the world.
        This year we are expanding our country's missile defense portfolio
    by preparing for alert status, a BMDS to defend the United States
    against a long-range ballistic missile attack. Chart 2 provides a basic
    description of how we could engage a warhead launched against the
    United States.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Last year, we made it clear that this initial capability would be
    very basic if it were used. We also emphasized that instead of building
    a test bed that might be used operationally, we would field more
    interceptors and have them available for use while we continue to test.
    Because the test bed provides the infrastructure for this initial
    capability, the additional budget request for the 20 Block 2004
    interceptors and associated support was about $1.5 billion in fiscal
    year 2004 and fiscal year 2005.
        Forces to be placed on alert as part of the initial configuration
    include up to 20 ground-based interceptors at Fort Greeley, Alaska and
    Vandenberg Air Force Base, an upgraded Cobra Dane radar on Eareckson
    Air Station in Alaska, and an upgraded early warning radar in the
    United Kingdom (U.K.). We are procuring equipment for 3 BMD-capable
    Aegis cruisers with up to 10 SM-3 missiles to be available by the end
    of 2005. The Navy is working very closely with us on ship availability
    schedules to support that plan. Additionally, 10 Aegis destroyers will
    be modified with improved SPY-1 radars to provide flexible long-range
    surveillance and track capability of ICBM threats by the end of 2005,
    with an additional 5 destroyers with this capability by 2006, for a
    total of 15 Aegis BMD destroyers and 3 Aegis BMD cruisers.
        The fiscal year 2005 request funds important for Block 2006
    activities to enhance those capabilities and system integration, which
    I will discuss in a moment.
        The MDA, the combatant commanders, the Joint Staff, the military
    services, and the Director, Operational Test and Evaluation (DOT&E) are
    working together to prepare for Initial Defensive Operations (IDO).
    Using the core capability provided by Ground-based Midcourse Defense
    (GMD) and augmenting it with the appropriate Command, Control, Battle
    Management, and Communications (C2BM/C) infrastructure between
    combatant commanders and exploiting the Aegis contribution in a
    surveillance and track mode, we have created an initial capability from
    which we can evolve.
        Our current fielding plans have been built on the test bed
    configuration we proposed 2 years ago and are within 60 days of our
    schedule. Silo and facility construction at Fort Greeley, Alaska and
    Vandenberg Air Force Base in California is proceeding well.
    Preparations at Eareckson Air Station in Shemya, Alaska are on track.
    Over 12,000 miles of fiber optic cables connecting major communication
    nodes are in place, along with 9 satellite communications links. We are
    in the process of upgrading the Early Warning Radar at Beale Air Force
    Base and are well underway building the sea-based X-band radar. Our
    brigade at Schriever Air Force Base and battalion fire control nodes at
    Fort Greeley are connected to the Cheyenne Mountain Operations Center.
    The C2BM/C between combatant commanders, so essential to providing
    situational awareness, is progressing well and is on schedule. Upgrades
    to the Cobra Dane Radar are ahead of schedule. The Chief of Naval
    Operations (CNO) has identified the first group of Aegis ships to be
    upgraded with a BMD capability, and the work to install the equipment
    on the first of these ships has begun.
        Once the system is placed on alert, we will continue to conduct
    tests concurrently to gain even greater confidence in its operational
    capability. Additionally, we plan activities to sustain the concurrent
    test and operations and support of the system. We are laying in the
    infrastructure to build, test, sustain, and evolve our system as a part
    of the capabilities-based approach inherent in our strategy.
        An integral working relationship with the warfighter, the BMDS
    user, is critical to the success of this mission. We are working
    together to ensure that we field a system that is militarily useful and
    operationally supportable and fills gaps in our defenses. The support
    centers we are establishing will provide critical training to
    commanders in the field. The necessary doctrines, concepts of
    operation, contingency plans, and operational plans are being developed
    under the lead of U.S. Strategic Command (STRATCOM) and in cooperation
    with U.S. Northern Command (NORTHCOM), Pacific Command (PACOM),
    European Command (EUCOM), and United States Forces in Korea (USFK).
         improving fielded capability through evolutionary acquisition
        The system's evolutionary nature requires us to look out over the
    next 3 or 4 years and beyond in our planning. Although it is not easy,
    we have laid out a budget and a plan to shape the missile defense
    operational architecture beyond the Block 2004 initial defensive
    capability.
        In this budget, beginning with Block 2006 we will increase GMD
    Ground-Based Interceptors (GBIs) and Aegis SM-3 interceptors, deploy
    new capabilities (such as Theater High-Altitude Aerial Defense
    (THAAD)), expand our sensor net (with a second sea-based midcourse
    radar and forward deployable radars), and enhance the C2BM/C system
    integration. The fiscal year 2005 request begins to fund important
    Block 2006 activities to enhance existing capabilities and system
    integration. Our improvement plan is to add up to ten GBIs to the site
    at Fort Greeley and possibly initiate long-lead acquisition of up to
    ten more for fielding at a potential third site or at Fort Greeley. We
    will continue to augment our sea-based force structure with additional
    SM-3 interceptors and BMD-capable Aegis-class ships.
        Much of this system augmentation effort involves extending and
    building on capabilities that we have been working on over the past
    several years, so I am confident that what we are doing is both
    possible and prudent and in line with our missile defense vision.
        The confidence we achieve through our entire test program is
    reinforced by the fact that many missile defense test articles fielded
    in the existing test bed are the same ones we would use in an
    operational setting. Except for interceptors, which are one-time use
    assets, we will use the same sensors, ships, communications links,
    algorithms, and command and control facilities. The essential
    difference between an inherent capability in a test bed and the near-
    term on-alert capability is having a few extra missiles beyond those
    needed for testing and having enough trained operators and logistics on
    hand and ready to respond around the clock. Once we field the system,
    we will be in a better position, literally, to test system components
    and demonstrate BMD technologies in a more rigorous, more operationally
    realistic environment. Testing will lead to further improvements in the
    system and refinement of our models, and the expansion and upgrades of
    the system will lead to further testing.
        The system we initially will put on alert is modest. It is modest
    not because the inherent capabilities of the sensors and interceptors
    themselves are somehow deficient, but rather because we will have a
    small quantity of weapons. The additional ten missiles for Fort Greeley
    will improve the overall system by giving us a larger inventory. Yet
    today, and over the near-term, we are inventory poor. Block activities
    throughout the remainder of this decade will be focused in part on
    improving the system by delivering to the warfighter greater
    capabilities with improved performance.
        Why is this important? In a defense emergency or wartime engagement
    situation, more is better. A larger inventory of interceptors will
    handle more threatening warheads. Our planning beyond the Block 2004
    initial configuration has this important warfighting objective in mind.
    There are no pre-conceived limits in the number of weapon rounds we
    should buy. We will build capabilities consistent with the national
    security objectives required to effectively deter our adversaries and
    defend ourselves and our allies.
        We also must think beyond the initial defensive capability if we
    are to meet our key national security objective of defending our
    friends and allies from missile attack. In Block 2006, we are preparing
    to move forward when appropriate to build a third GBI site at a
    location outside the United States. Not only will this site add synergy
    to the overall BMD system by protecting the United States, but it will
    put us in a better position to defend our allies and friends and troops
    overseas against long-range ballistic missiles. For the cost of 10 GBIs
    and associated infrastructure, we will be able to demonstrate in the
    most convincing way possible our commitment to this critical mission
    objective. The location of this site is still subject to negotiation
    with no final architecture defined nor investment committed until
    fiscal year 2006.
        As I have said all along, we are not building to a grand design. We
    are building an evolutionary system that will respond to our technical
    progress and reflect real world developments. We added about $500
    million to last year's projected fiscal year 2005 budget estimate to
    begin funding our Block 2006 efforts. As you can see, the system can
    evolve over time in an affordable way in response to our perception of
    the threat, our technical progress, and our understanding of how we
    want to use the system. Yet even as it does evolve, our vision remains
    constant--to defeat all ranges of missiles in all phases of flight.
            testing missile defenses--we need to build it to test it
        Another key question surrounds the nature of missile defense
    systems themselves. How do you realistically test an enormous and
    complex system, one that covers eight time zones and engages enemy
    warheads in space? The answer is that we have to build it as we would
    configure it for operations in order to test it. That is exactly what
    we are doing by building our test bed and putting it on alert this
    year.
        By hooking it all up and putting what we have developed in the
    field, we will be in a better position to fine-tune the system and
    improve its performance. Testing system operational capability in this
    program is, in many ways, different from operational testing involving
    more traditional weapon systems. All weapon systems should be tested in
    their operational environments or in environments that nearly
    approximate operational conditions. This is more readily accomplished
    for some systems, and is more difficult to do for others.
        For example, an aircraft's operational environment is the
    atmosphere. Similarly, when we conduct rigorous operational tests of
    our Navy's ships, we do so at sea--in their environment. The BMDS's
    operational environment is very different. It is a geographically
    dispersed region that is also a test bed. For both missile defense
    testing and operations, geography counts. After we have gone through
    the simulations, the bench tests, and the flybys, we want to test all
    missile defense parts together under conditions that are as nearly
    operationally realistic as we can make them--with sensors deployed out
    front, with targets and interceptors spaced far enough apart to
    replicate actual engagement distances, speeds and sequences, with
    communication links established, and with command and control elements
    in place. We in fact have conducted a number of events that exercise
    the projected communication and command and control paths required to
    link elements of the BMDS in what we call ``Engagement Sequence
    Groups,'' building our confidence that we can combine threat data from
    different systems across a third of the globe to allow for the
    engagement of ballistic missiles threats to the entire United States.
        One of the key questions that we have to answer is: What is the
    role of operational testing in an unprecedented, evolutionary,
    capability-based program? The answer is that the DOT&E, and the
    operational test agencies (OTAs) play a critical role in missile
    defense. Since evolutionary, capability-based processes do not fit the
    traditional ORD-based operational test methodology, we have applied an
    assessment approach that provides for a continuous assessment of the
    capabilities and limitations of the BMD system. Since testing is
    central to our RDT&E program and our operational understanding of the
    system, we are continuing to modernize and improve our test
    infrastructure to support more operationally realistic testing.
        We are working very closely with Mr. Christie, the DOT&E, and the
    operational test community. As our tests are planned, executed, and
    evaluated, the BMDS Combined Test Force, which brings together
    representatives from across the testing community, is combining
    requirements for both developmental and operational capability testing.
    Wherever possible, we are making every test both operationally
    realistic and developmental. We have been working daily with the
    appropriate independent OTAs to ensure they are on board with our
    objectives and processes. There are approximately 100 operational test
    personnel embedded in all facets of missile defense test planning and
    execution who have access to all of our test data. They have the
    ability to influence every aspect of our test planning and execution.
        Now, how much confidence should we have in using this test bed in
    an alert status? The full range of missile defense testing--from our
    extensive modeling and simulation and hardware-in-the-loop tests to our
    ground and flight testing--makes us confident that what we deploy will
    work as intended. We do not rely on intercept flight tests to make
    final assessments concerning system reliability and performance. Our
    flight tests are important building blocks in this process, but the
    significant costs of these tests combined with the practical reality
    that we can only conduct a few tests over any given period of time mean
    we have to rely on other kinds of tests to prove the system. System
    capabilities assessed for IDO will be based on test events planned for
    fiscal year 2004 as well as data collected from flight- and ground-
    tests and simulations over the past several years.
        The missile defense test program helps define the capabilities and
    limitations of the system. The thousands of tests we conduct in the
    air, on the ground, in the lab, and with our models and simulations in
    the virtual world predict system performance and help identify problems
    so that we can fix them. They also highlight gaps so that we can
    address them. This accumulated knowledge has and will continue to
    increase our confidence in the effectiveness of the system and its
    potential improvements. None of our tests should act as a strict
    ``pass-fail'' exercise telling us when to proceed in our development or
    fielding. We can approximate realistic scenarios, though, after we have
    put interceptors and sensors in the field and integrated them with our
    C2BM/C network.
        We conduct other kinds of tests that provide valuable information
    about the progress we are making and the reliability of the system.
    Integrated ground tests, for example, are not subject to flight test
    restrictions and can run numerous engagement scenarios over the course
    of a few weeks. Our modeling and simulation activity is an even more
    powerful system verification tool. It is important to understand that
    in the Missile Defense Program we use models and simulations, and not
    flight tests, as the primary verification tools. Missile defense ground
    and flight tests anchor the data we insert in our models, which in turn
    enhance our confidence regarding the operational capability we can
    achieve, because we can understand the system's behavior in many
    hundreds of test runs.
        For example, our modeling and simulation capabilities are very
    accurate and allow us to mirror the achieved outcome of a flight test.
    The graphic below provides an example of why we believe our simulation
    capabilities to be the most powerful tools for projecting the
    reliability of the initial BMDS. In Figure 1 we have mapped out the
    predicted performance of the Integrated Flight Test 13B interceptor and
    matched it up with performance data we collected during the flight. The
    match up is nearly exact, and it shows that the Exo-atmospheric Kill
    Vehicle Mass Simulator was very close to the predicted insertion point
    velocity.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Generally, when we deploy a weapon system in a traditional mission
    area, it is appropriate to conduct initial operational testing to
    ensure that the replacement system provides a better capability than
    the existing system. Put another way, there is a presumption that the
    deployed system should be used until a better capability is proven. In
    the current situation, where we have no weapon system fielded to defend
    the United States against even a limited attack by ICBMs, that
    presumption must be re-examined. With the provision of a militarily
    useful capability, even if it is limited, it is presumed that the
    capability can be fielded unless it is determined that operating the
    initial capability is considered to be an unacceptable danger to the
    operators, or any other similar reality.
        STRATCOM will factor in all available test information into its
    military utility assessment of the fielded condition.
       ballistic missile defense system research and development program
        We have requested $7.6 billion in fiscal year 2005 to continue our
    investment in missile defense RDT&E. Why do we need this level of
    investment in RDT&E? We need to press forward with our missile defense
    research and development (R&D) if we are to improve the system by
    integrating upgraded or more advanced components and by exploiting new
    basing modes to engage threat missiles in, for example, the boost phase
    of flight. We have to lay the RDT&E foundation for evolutionary
    improvements to the BMD system. We intend to improve the capability of
    the midcourse phase while adding additional layers.
        The RDT&E program is working. The ability to make trade-offs among
    our development activities has allowed us to focus on the development
    of the most promising near-term elements, namely, GMD, Aegis BMD and
    PAC-3. GMD and Aegis BMD make up elements of the midcourse defense
    layer while PAC-3 provides capability in the terminal layer. The GMD
    fiscal year 2005 budget request is $3.2 billion; the request for Aegis
    is $1.1 billion.
        In this budget we increase investment in the development of a boost
    layer. Two program elements, a high energy laser capability and a new
    kinetic energy interceptor (KEI) or ``hit to kill'' capability,
    represent parallel paths and complement each other. Achieving
    capability in the boost phase as soon as practicable would be a
    revolutionary, high-payoff improvement to the BMD system. Although the
    technologies are well known, the engineering and integration required
    to make them work are very high risk. Therefore, having parallel
    approaches, even on different timelines, is a very prudent program
    management approach. We expanded our efforts in the boost phase as soon
    as we were able after withdrawal from the 1972 Anti-Ballistic Missile
    (ABM) treaty, which specifically prohibited boost phase development
    against long-range missiles.
        The Airborne Laser (ABL) program has been in development since
    1996. Development of an operational high energy laser for a 747
    aircraft is a difficult technical challenge. Although we have had many
    successes in individual parts of the program, we have not been able to
    make some of our key milestones over the past year. The last 20 percent
    of the program effort has proven to be very difficult, and some of the
    risks we took early in the program have impaired our present
    performance. Consequently, I reviewed the program late last year and
    directed a restructure that focused on our near-term efforts, delaying
    the procurement of the second aircraft until we could gain more
    confidence in our ability to meet schedules. I have adjusted the
    resources accordingly.
        We no longer plan for ABL to deliver a contingency capability in
    Block 2004. There have been, nevertheless, several technical
    accomplishments to date. We have demonstrated the capability to track
    an ICBM in the boost phase using ABL technologies and improved beam
    control and fire control technologies. At this time there is no reason
    to believe that we will fail to achieve this capability. This is such a
    revolutionary and high payoff capability; I believe we should again be
    patient as we work through the integration and test activities. But the
    risks remain high. The fiscal year 2005 budget request is $474 million
    for ABL.
        We undertook the KEI boost effort in response to a 2002 Defense
    Science Board Summer Study recommendation. In December 2003 we awarded
    the contract for development of the KEI boost effort. This was the
    first competition unconstrained by the ABM Treaty. It was also the
    first to use capability-based spiral development as a source selection
    strategy. The contract requires development of a boost phase
    interceptor that is terrestrial-based and can be used in other
    engagement phases as well--including the midcourse and possibly exo-
    atmospheric terminal phases. In other words, it could provide boost
    phase capability as well as an affordable, competitive next-generation
    replacement for our midcourse interceptors and even add a terminal
    phase capability should it be required. In 2005, we will begin
    conducting Near-Field Infrared Experiments to get a close-up view from
    space of rocket plumes to support the development of the terrestrial-
    based interceptor seeker and provide additional data needed for the
    development of a space test bed.
        We have budgeted about $500 million for the KEI boost effort for
    fiscal year 2005. I believe this funding is necessary for a successful
    start. Those who would view this amount as a significant increase that
    is unwarranted for a new effort do not understand the importance of
    prudent programming and the preparatory work required to make such a
    program ultimately succeed. There are many examples of an underfunded
    systems engineering effort, where engineering costs sky-rocketed
    because adequate upfront work was not done. Mr. Chairman, I urge the
    committee to look carefully at our proposal and allow us to get a solid
    start on this essential piece of the layered BMDS.
                            other budget highlights
        Funding in the fiscal year 2005 request supports the Block 2004
    initial configuration as well as activities to place the BMDS on alert.
    It also lays the foundation for the future improvement of the system.
    We are requesting $9.2 billion to support this program of work, which
    is approximately a $1.5 billion increase over the fiscal year 2004
    request. The increase covers costs associated with fielding the first
    GMD, Aegis BMD, sensor, and command, control, and battle management
    installments and will allow us to purchase long-lead items required for
    capability enhancements in Block 2006.
        We have made a successful transfer of the PAC-3 program to the Army
    and remain convinced that the Department made the right decision in
    doing so. In the Patriot system, missile defense and air defense are so
    intertwined that attempting to manage them separately would be
    difficult if not futile. We continue to believe that the Army is in the
    best position, given the maturity of the PAC-3, to manage future
    enhancements and procurements. Meanwhile MDA remains fully cognizant of
    the Army's efforts and maintains the PAC-3 in the BMDS as a fully
    integrated element, with interfaces controlled by our configuration
    management process. PAC-3 is part of our ongoing system development and
    testing.
        The fiscal year 2005 funding request will buy equipment to ramp up
    the testing of THAAD, which, once fielded, will add endo-atmospheric
    and exo-atmospheric terminal capabilities to the BMD system to defeat
    medium-range threats. THAAD is progressing well and will add
    capabilities to engage in the late midcourse and terminal layers. THAAD
    recently completed the Design Readiness Review, and development
    hardware manufacturing is underway. The fiscal year 2005 budget request
    is $834 million for THAAD. Delivery of the THAAD radar was completed
    ahead of schedule and rolled out this month. Flight testing is
    scheduled to begin in the first quarter of fiscal year 2005 at White
    Sands Missile Range, New Mexico.
        We will be able to begin assembly and integration of two Space
    Tracking and Surveillance System (STSS) satellites. The fiscal year
    2005 budget request for STSS is $322 million.
        We will continue development of the C2BM/C ``backbone'' to provide
    real-time sensor-netting to the warfighter for improved
    interoperability and decisionmaking capability. Additional BMD system
    C2BM/C suites and remote capability will be deployed to combatant
    commanders as the system matures.
        We also have several science and technology (S&T) initiatives to
    increase BMDS firepower and sensor capability and extend the engagement
    battle space of terminal elements. One of our main efforts is to
    increase BMDS effectiveness in the midcourse phase by placing Multiple
    Kill Vehicles on a single booster, thus reducing the discrimination
    burden on BMD sensors. We also are conducting important work on
    advanced systems to develop laser technology and laser radar, advanced
    discrimination, improved focal plane arrays, and a high-altitude
    airship for improved surveillance, communication, and early warning. In
    support of this, we have requested about $200 million in the fiscal
    year 2005 budget request for the development of advanced systems.
                           international partnerships
        In December 2003, through a formal Cabinet Decision, the Government
    of Japan became our first ally to proceed with acquisition of a multi-
    layered BMDS, basing its initial capability on upgrades of its Aegis
    destroyers and acquisition of the SM-3 missile. In addition, Japan and
    other allied nations will upgrade their Patriot units with PAC-3
    missiles and improved ground support equipment. We have worked closely
    with Japan since 1999 to design and develop advanced components for the
    SM-3 missile. This project will culminate in flight tests in 2005 and
    2006 that incorporate one or more of these components. These decisions
    represent a significant step forward with a close ally, and we look
    forward to working together on these important efforts.
        We are undertaking major initiatives in the international arena in
    this budget. Interest among foreign governments and industry in missile
    defense has risen considerably over the past year. We have been working
    with key allies to put in place mechanisms that would provide for
    lasting cooperative efforts.
        We will begin in fiscal year 2005 to expand international
    involvement in the program by encouraging international industry
    participation and investment in the development of alternative boost/
    ascent phase element components, such as the booster, kill vehicle,
    launcher, or C2BM/C. This approach reduces risk, adds options for
    component evolution for potential insertion during Block 2012, and
    potentially leads to an indigenous overseas production capability. We
    intend to award a contract for this effort this year.
        In 2003 the United States signed a Memorandum of Understanding on
    BMD with the U.K. and an annex enabling the upgrade of the Fylingdales
    early warning radar. We are continuing our consultations with Denmark
    regarding the upgrade of the Thule radar site in Greenland. Australia
    has announced plans to participate in our efforts, building on its
    longstanding defense relationship with the United States. Canada also
    has entered into formal discussion on missile defense and is
    considering a BMD role for the U.S.-Canadian North American Aerospace
    Defense Command (NORAD). Our North Atlantic Treaty Organization (NATO)
    partners have initiated a feasibility study for protection of NATO
    territory against ballistic missile attacks, which builds upon ongoing
    work to define and develop a NATO capability for protection of deployed
    forces.
        We are continuing work with Israel to implement the Arrow System
    Improvement Program and enhance its missile defense capability to
    defeat the longer-range ballistic missile threats emerging in the
    Middle East. We are also establishing a capability in the United States
    to co-produce specified Arrow interceptor missile components, which
    will help Israel meet its defense requirements more quickly and
    maintain the U.S. industrial work share. We are intent on continuing
    U.S.-Russian collaboration and are now working on the development of
    software that will be used to support the ongoing U.S.-Russian Theater
    Missile Defense exercise program.
        We have other international interoperability and technical
    cooperation projects underway as well and are working to establish
    formal agreements with other governments. Our international work is a
    priority that is consistent with our vision and supportive of our
    goals.
            world-class systems engineering--the key success factor
        The President's direction to defeat ballistic missiles of all
    ranges in all phases of flight drove us to develop and build a single
    integrated system of layered defenses and forced us to transition our
    thinking to become more system-centric. We established the Missile
    Defense National Team to solve the demanding technical problems ahead
    of us and capitalize on the new engineering opportunities created by
    our withdrawal from the ABM Treaty. The National Team brings together
    the best, most experienced people from the military and civilian
    government work forces, industry, and the Federal laboratories to work
    aggressively and collaboratively on one of the Nation's top priorities.
    No single contractor or government office has all the expertise needed
    to design and engineer an integrated and properly configured BMDS. Let
    me give a perspective on why the National Team is so important.
        What we have accomplished is an unprecedented integration of
    sensors, communications, infrastructure, and weapons that cut across
    Service responsibilities on a global scale. Even our first engagement
    sequence involves an unparalleled accomplishment.
        The BMDS will engage a long-range ballistic missile threat across
    9,500 miles. Threat messages sent by an Aegis destroyer will pass this
    data across eight BMDS communication nodes. System data travels across
    approximately 48,000 miles of communication lines. The engagement takes
    place 3,500 from Fort Greeley at an altitude of 100 kilometers. At no
    time in history has there been an engagement performed by detection and
    weapon engagement systems separated by such distances. Over the past
    year and a half, we have rapidly built confidence in this weapon
    engagement capability through the use of proven systems and
    technologies coupled with robust integrated tests and exercises.
        The National Team's job has not been easy. System engineers work in
    a changed procurement and fielding environment, which in the missile
    defense world means making engineering assessments and decisions based
    on technical objectives and goals and possible adversary capabilities
    rather than on specifications derived from more traditional operational
    requirements documents. This unified industry team arrangement does not
    stifle innovation or compromise corporate well-being. There is firm
    government oversight and greater accessibility for all National Team
    members to organizations, people, and data relevant to our mission. We
    accomplished this without abandoning sound engineering principles,
    management discipline, or accountability practices.
        Significant benefits have resulted from this unique approach. Early
    on, this team brought to the program several major improvements,
    including: system-level integration of our command and control network;
    adoption of an integrated architecture approach to deal with
    countermeasures; development of a capability-requirement for forward-
    based sensors, such as the Forward Deployable Radar and the Sea-Based
    X-Band Radar; and identification of initial architecture trades for the
    boost/ascent phase intercept mission. The National Team also developed
    and implemented an engagement sequence group methodology, which
    optimizes performance by looking at potential engagement data flows
    through the elements and components of the system independent of
    Service or element biases. If we had retained the traditional element-
    centric engineering approach, I am doubtful that any one of the element
    prime contractors would have entertained the idea of a forward-based
    radar integrated with a ``competing'' system element. The National Team
    is central to this program.
                      responsible and flexible management
        Congressional support for key changes in management and oversight
    have allowed us to execute the Missile Defense Program responsibly and
    flexibly by adjusting the program to our progress every year, improving
    decision cycle time, and making the most prudent use of the money
    allocated to us.
        One of the key process changes we made in 2001 was to engage the
    Department's top leadership in making annual decisions to accelerate,
    modify, or terminate missile defense activities. We take into account
    how each development activity contributes to effectiveness and synergy
    within the system, technical risk, schedules, and cost, and we then
    assess how it impacts our overall confidence in the effort. We have
    successfully used this process over the past 3 years.
        Today's program is significantly different from the program of 3
    years ago. In 2001 and 2002 we terminated Space-Based Laser development
    in favor of further technology development; restructured the Space-
    Based Infrared Sensors (Low) system, renaming it the Space Tracking and
    Surveillance System, to support more risk reduction activities;
    cancelled the Navy Area program following significant cost overruns;
    and accelerated PAC-3's deployment to the field. We also proposed a
    modest beginning in fielding the BMDS and put Aegis BMD and its SM-3
    interceptor on track to field.
        This year we have restructured the ABL program to deal more
    effectively with the technical and engineering challenges before us and
    make steady progress based on what we know. We also decided to end the
    Russian-American Observation Satellite (RAMOS) project because of
    rising levels of risk. After 8 years of trying, RAMOS was not making
    the progress we had expected in negotiations with the Russian
    Federation. So we are refocusing our efforts on new areas of
    cooperation with our Russian counterparts.
        These periodic changes in the RDT&E program have collectively
    involved billions of dollars--that is, billions of dollars that have
    been invested in more promising activities, and billions of dollars
    taken out of the less efficient program efforts. The ability to manage
    flexibly in this manner saves time and money in our ultimate goal of
    fielding the best defenses available on the shortest possible timeline.
        Such decisive management moves were made collectively by senior
    leaders in the Department and in MDA. I believe these major changes are
    unprecedented in many respects and validate the management approach we
    put in place. The benefits of doing so are clearly visible today. When
    something is not working or we needed a new approach, we have taken
    action.
                                    closing
        Mr. Chairman, I would like to recognize the many talented and
    dedicated people across this country who have made, and are continuing
    to make, our efforts successful. I have met with people from
    manufacturing facilities, R&D centers, and test centers. I have met
    with people from many different parts of the world who are working on
    our international efforts. Our fellow citizens should be proud of the
    talent, commitment, and dedication that every one of these people
    provides.
        We take our responsibilities very seriously. We have an obligation
    to the President, Congress, and the American people to get it right.
    With the continued strong support of Congress and this committee, we
    will continue our progress in defending the United States, our troops,
    and our allies and friends against all ranges of ballistic missiles in
    all phases of flight.
        Thank you, and I look forward to your questions.

        Chairman Warner. General, that is a very encouraging report
    that you have given. Thank you for your long service. It is
    extremely important to have that system. Thank you.
        General Dodgen.

      STATEMENT OF LTG LARRY J. DODGEN, USA, COMMANDER, SPACE AND
                        MISSILE DEFENSE COMMAND

        General Dodgen. Mr. Chairman, Senator Levin, and members of
    the committee, thank you for the opportunity to appear before
    this distinguished committee and for your ongoing support of
    the Army.
        This panel has been a long-time friend of the Army,
    particularly of our efforts to field missile defense forces for
    the Nation. The Army considers it a privilege to be counted in
    the ranks with Mr. Wynne, Mr. Christie, Admiral Ellis, and
    Lieutenant General Kadish as advocates for a strong GMD system.
        Today I appear before this committee as the Army proponent
    for a ground-based midcourse defense system. In a broader
    context, I'm a member of the joint missile defense team as the
    Army component commander in support of STRATCOM.
        Chairman Warner. General, let me interrupt you to ask you
    to get that mic on a very directional basis. Just think of it
    as a missile coming up to get you. Put it right there so you
    can get into it.
        General Dodgen. I have been there, Senator. The joint user
    representative working closely with the MDA, other Services,
    and combatant commanders to ensure that our national goals of
    developing, testing, and deploying a missile defense system are
    met.
        Mr. Chairman, as we speak, Army men and women are training
    to operate the GMD system being deployed at Fort Greeley,
    Alaska. During the past months an initial cadre of GMD brigades
    and a subordinate battalion were activated. Once IDO are stood
    up, these soldiers will stand as part of the joint team in our
    Nation's first line of defense against any launch, either
    accidental or hostile, of an intercontinental ballistic missile
    (ICBM) toward our shores. I am proud to represent them. Meeting
    their needs in training and support is our highest priority.
        In addition to deploying a GMD system, the MDA, the Army,
    and other DOD agencies, and Services have focused attention on
    improving Theater Missile Defense (TMD) systems. Both GMD and
    TMD systems are vital to protecting our homeland, deployed
    forces, friends, and allies.
        Missile defense is a key component in support of our Army's
    core competency of providing relevant and ready land power to
    combatant commanders as part of the joint force. Today I've
    been asked about and I'm happy to focus on developments
    concerning the Patriot missile system, particularly the PAC-3,
    and its follow-on system, the Medium Extended Air Defense
    System (MEADS). Both of these systems are designed to counter
    theater missile threats in their terminal flight phase as well
    as cruise missile threats. These systems will bring an umbrella
    of security for deployed forces well into the future. I would
    like to thank Congress for its continued support of these
    important systems.
        Mr. Chairman, in 1991, during Operation Desert Storm (ODS)
    we witnessed the first use of the Patriot Air and Missile
    Defense System. Following ODS, the Army implemented a series of
    improvements to address the lessons learned. Nearly 1 year ago,
    we saw the improved Patriot system including the Guidance
    Enhanced Missile (GEM) and the PAC-3 debut in combat during
    OIF. In OIF, the Patriot system saved lives from ballistic
    missile attacks, as you pointed out.
        The Patriot system remains the Army's premier TMD system.
    PAC-3 is the latest evolution of a phase material change
    improvement program to Patriot. Combining developmental testing
    and operations, this program has allowed for the development
    and deployment of the PAC-3, thus bringing a new high velocity
    kinetic hit-to-kill, surface-to-air missile with the range,
    accuracy and lethality necessary to effectively intercept and
    destroy most sophisticated ballistic missile threats.
        Recently, the Army, after approval by the Defense
    Acquisition Board, the executive rather, embarked on a path to
    merge the Patriot and MEADS missile systems. In doing so, the
    combined aggregate program was established. The objective of
    the cap is to achieve MEADS capability through incremental
    fielding of MEADS major end items into the Patriot system.
        MEADS is a trinational codevelopment program that consists
    of Italy, Germany, and the United States. Once fielded, MEADS
    will provide linkage to the Army's fully networked battle
    command capabilities, serve as a bridge from the current to the
    future force, enable interdependent network-centric warfare,
    provide for Future Combat System (FCS) interoperability, and
    fully support joint operational concepts.
        The MEADS system is transformational. It offers a
    significant improvement in strategic deployability and tactical
    mobility. The system uses a netted and distributed architecture
    with modular and configural battle elements, allowing it to
    integrate with other airborne and ground-based sensors and
    shooters.
        These features and capabilities will allow MEADS to achieve
    a robust 360-degree defense against all airborne threats,
    tactical ballistic missiles, cruise missiles, UAVs, and manned
    aircraft.
        Mr. Chairman, by combining the resources available to both
    Patriot and MEADS, the Army is able to achieve incremental
    development and accelerate incremental fielding of MEADS major
    end items. This incremental fielding approach reduces
    sustainment costs while delivering increased anti-missile
    defense capabilities across the force earlier. This approach
    offers the most efficient use of limited valuable resources
    while giving maximum flexibility in regard to funding and
    developing requirements of the warfighter.
        The Army and the entire missile defense community continue
    to strive to improve our Nation's missile defense capabilities.
    The established combined aggregate program effort will be just
    that. The Patriot architecture will become more robust as
    enhancements are integrated into the existing system.
    Simultaneously, lessons learned from the present missile
    defense capability will be incorporated into the MEADS follow-
    on system. We are confident that this path will provide our
    service members, our allies, our friends, and our Nation with
    the most capable missile defense system possible.
        Mr. Chairman, the Army is relevant and ready, fighting the
    war on terrorism, deployed in Southwest Asia and elsewhere.
    Also, we are deterring aggression throughout the world while
    transforming to meet future needs. Within its responsibilities
    for GMD, Patriot, and MEADS, the Army is a key player in the
    development of the BMDS which will counter existing and
    emerging threats to the U.S., our deployed forces, and friends
    and allies.
        I appreciate having the opportunity to speak on these
    important matters and look forward to addressing any questions
    you and other members of the committee may have. Thank you, Mr.
    Chairman.
        [The prepared statement of General Dodgen follows:]
                 Prepared Statement by LTG Larry J. Dodgen, USA
                                  introduction
        Mr. Chairman, Senator Levin, and members of the committee, thank
    you for the opportunity to appear before this distinguished committee
    and for your ongoing support of our Army. This panel has been a long
    time friend of the Army, particularly of our efforts to field missile
    defense forces for the Nation. The Army considers it a privilege to be
    counted in the ranks with Mr. Christie, Mr. Wynne, Admiral Ellis, and
    Lieutenant General Kadish as advocates for a strong global missile
    defense system. Today, I appear before this committee as the Army
    proponent for the Groundbased Midcourse Defense (GMD) System. In a
    broader context, I am a member of the joint missile defense team as the
    Army component commander in support of the United States Strategic
    Command, and the joint user representative working closely with the
    Missile Defense Agency (MDA), other Services, and combatant commanders
    to ensure that our national goals of developing, testing, and deploying
    a missile defense system are met.
        Mr. Chairman, as we speak, Army men and women are training to
    operate the GMD System being deployed at Fort Greeley, Alaska. During
    the past few months, an initial cadre of the GMD Brigade and a
    subordinate GMD Battalion were activated. Once Initial Defensive
    Operations (IDO) are stood up, these soldiers will stand as part of the
    joint team in our Nation's first line of defense against any launch,
    either accidental or hostile, of an intercontinental ballistic missile
    toward our shores. I am proud to represent them. Meeting their needs,
    in training and support, is our highest priority.
                     theater missile defense--patriot/meads
        In addition to deploying a GMD system, the MDA, the Army, and other
    Department of Defense (DOD) agencies and Services have focused
    attention on improving Theater Missile Defense (TMD) systems. Both GMD
    and TMD systems are vital for protecting our homeland, deployed forces,
    friends and allies. Missile defense is a key component in support of
    the Army's core competency of providing relevant and ready land power
    to combatant commanders as part of the joint force.
        Today, I have been asked about, and I am happy to focus on,
    developments concerning the Patriot Missile System, particularly the
    Patriot Advanced Capability-3 (PAC-3), and its follow-on system, the
    Medium Extended Air Defense System (MEADS). Both of these systems are
    designed to counter theater missile threats in their terminal flight
    phase as well as cruise missile threats. These systems will bring an
    umbrella of security for deployed forces well into the future. Again, I
    would like to thank Congress for its continued support of these
    important systems.
        Mr. Chairman, in 1991, during Operation Desert Storm (ODS), we
    witnessed the first use of the Patriot Air and Missile Defense System.
    Initial reports praised the system; however, further analysis
    determined that it was partially effective, still providing, for the
    first time in history, some protection against ballistic missiles for
    relatively small but high value assets. Following ODS, the Army
    implemented a series of improvements to address the lessons learned.
    Nearly 1 year ago we saw the improved Patriot system, including the
    Guidance Enhanced Missile (GEM) and PAC-3 missiles, debut in combat
    during Operation Iraqi Freedom (OIF). Detailed analysis from a variety
    of data sources confirm that eight of nine warheads intercepted by the
    Patriot system during OIF were destroyed. There is insufficient data on
    the ninth intercept to conclusively validate a warhead kill. In OIF,
    Patriot saved lives from ballistic missile attack.
        The Patriot system remains the Army's premier TMD system. PAC-3 is
    the latest evolution of the phased material change improvement program
    to Patriot. Combining developmental testing and operations, this
    program has allowed for the development and deployment of the PAC-3,
    thus bringing a new high-velocity, kinetic hit-to-kill, surface-to-air
    missile with the range, accuracy, and lethality necessary to
    effectively intercept and destroy more sophisticated ballistic missile
    threats.
                               combined approach
        Recently, the Army, after approval by the Defense Acquisition
    Executive, embarked on a path to merge the Patriot and MEADS missile
    systems. In so doing, the Combined Aggregate Program (CAP) was
    established. The objective of the CAP is to achieve the MEADS
    capability through incremental fielding of MEADS major end items. MEADS
    is a tri-national co-development program that consists of Italy,
    Germany, and the United States. Once fielded, MEADS will provide
    linkage to the Army's fully networked battle command capabilities,
    serve as a bridge from the current to future force, enable
    interdependent network-centric warfare, provide for Future Combat
    System (FCS) interoperability, and fully support joint operating
    concepts.
        The MEADS system is transformational--it offers a significant
    improvement in strategic deployability and tactical mobility. The
    system uses a netted and distributed architecture with modular and
    configurable battle elements allowing it to integrate with other
    airborne and ground-based sensors and shooters. These features and
    capabilities will allow MEADS to achieve a robust 360-degree defense
    against all airborne threats: tactical ballistic missiles, cruise
    missiles, unmanned aerial vehicles, and manned aircraft.
        Mr. Chairman, by combining the resources available to both the
    Patriot and MEADS programs, the Army is able to achieve incremental
    development and accelerate incremental fielding of MEADS major end
    items. This incremental fielding approach reduces sustainment costs
    while delivering increased anti-missile defense capability across the
    force earlier. This approach offers the most efficient use of limited,
    valuable resources while giving maximum flexibility in regard to
    funding and developing requirements of the warfighter.
        There are several key elements of the combined program that further
    demonstrate the benefits. First, the existing PAC-3 Missile is the
    internationally accepted missile for MEADS. The Missile Segment
    Enhancement (MSE) is an improvement over PAC-3 and under consideration
    by the tri-national partners. The PAC-3 MSE will replace the standard
    PAC-3 in production. It will provide an increase in battle space
    against both missile and air breathing threats.
        Second, battlefield management, command, control, communications,
    and intelligence will continually evolve during the CAP; therefore, the
    new system will take into account recent developments while
    simultaneously remaining integrated within the MDA's and the Army's
    System of Systems requirements. Additionally, operational Patriot units
    will be modernized as these new enhancements are added to their
    equipment.
        Third, the program allows for earlier procurement of the objective
    lightweight launcher in lieu of the recapitalization program and
    conversion of existing launchers.
        Fourth, MEADS requires the development of a new Multifunction Fire
    Control Radar (MFCR) and a new Surveillance Radar (SR) to achieve 360-
    degree engagement capabilities. The fielding of this new sensor suite
    will complete the CAP and provide Army air and missile defense forces
    with the capability to counter threats of the 21st century.
        The Army, and the entire missile defense community, continues to
    strive to improve our Nation's missile defense capabilities. The
    established CAP effort will be just that. The Patriot architecture will
    become more robust as enhancements are integrated into the existing
    system. Simultaneously, lessons learned from the present missile
    defense capability will be incorporated into the MEADS follow on
    system. We are confident that this path will provide our service
    members, our allies, our friends, and our Nation with the most capable
    missile defense system possible.
                                   conclusion
        Mr. Chairman, the Army is relevant and ready, fighting the war on
    terrorism, deployed in Southwest Asia and elsewhere, and deterring
    aggression throughout the world while transforming to meet future
    threats. With its responsibilities for GMD, Patriot, and MEADS, the
    Army is a key player in the development of the Ballistic Missile
    Defense System which will counter existing and emerging threats to the
    U.S., our deployed forces, and friends and allies. I appreciate having
    the opportunity to speak on these important matters and look forward to
    addressing any questions you or the other members of the committee may
    have.

        Chairman Warner. Thank you very much, General. We will
    proceed to a round of 6 minutes for each Senator, and at some
    juncture I will have to depart for another commitment. I will
    ask Senator Allard to chair the hearing at that time.
        My questions will be very direct to get a concise reply on
    what principal issues face us. So Mr. Wynne, we have heard a
    very excellent report from General Kadish. I would like to have
    in your own words the following. In December 2002, the
    President directed the Secretary of Defense to field an initial
    set of missile defense capabilities starting in 2004.
        How would you assess the progress to date, and are we on
    schedule?
        Mr. Wynne. I will assess the progress to date as being
    categorically good. It is a fragile system. We had an explosion
    in one of the bases of our dual supply system for solid rocket
    motors, which lends me some caution as to our capability to
    proceed in the future, but I will tell you that the missile
    defense office had a marvelous dual strategy which allowed them
    to continue on for IDO capability, as well as testing.
        I would also tell you that I personally reviewed their
    systems engineering plan, and I found it to be remarkably
    forward-leaning. In fact, I have asked the rest of the
    Department to check in on that to see what they can do.
        Their testing is rigorous. It's involved. It involves the
    users, which is also unusual in the sense of a strategic system
    like this, which I find exemplary. I think their use of the
    operational testers as consultants to the development testers
    has allowed a certain additional rigor into their test
    philosophy and discipline.
        Frankly, the quality discipline that I find is excellent
    and I believe that they are on track, sir, to bring the
    capability as the President directed by the end of 2004.
        Chairman Warner. Thank you. The next question, again, is to
    Secretary Wynne, but I ask that Director Christie and General
    Kadish make such replies as they desire.
        Gentlemen, I know that concerns have been expressed about
    the level of involvement by the operational test community in
    missile defense development. You have all stated your
    commitment to realistic and rigorous testing. What is the
    appropriate role for operational testing as it relates to
    missile defense development? Second, are there lessons learned
    from the successful development of other weapons systems that
    might provide insights into the proper role of operational
    testing of the BMDS?
        Mr. Wynne. Mr. Chairman, the role of operational tests in
    this instance is very interesting because this is a system of
    systems and the role of operational testing is different as
    each system is developed.
        We asked that they oversee the testing that goes on of the
    components and the subsystems. As Senator Levin inferred, the
    Patriot missile, for example, has undergone a rigorous
    operational test although it is a component of the total
    ballistic missile defense.
        I see a gradual turn over the years, as we become more and
    more operationally effective. I know that the inclusion of
    STRATCOM and the user of developing the MUA is particularly
    profound in that there is a three-way feedback, if you will,
    from developmental tests, but also operational tests and from
    user involvement into the development of an evolutionary plan
    here.
        I will tell you that the rigor is going up dramatically.
    The capability is going up dramatically, and I feel quite
    confident of the testing capability.
        Chairman Warner. Director Christie?
        Mr. Christie. This program is again a typical development
    program, albeit a very complex program. My involvement is much
    stronger in this program than in most development programs.
        General Kadish and I meet quite often, and he keeps
    reminding me that I have 100-some-odd operational testers
    crawling all over his programs, which is rather unique, I
    think, at this stage.
        Again, I think the issue that we are talking about here is
    the building of missiles that will be put into silos that are a
    part of the test bed. We have to have this test bed in order to
    accomplish testing that will become more realistic and have
    more realistic engagement in terms of geometries, for example,
    than we have been able to do before.
        Some of these attributes of this test bed are in response
    to a lot of the criticism that came from my office and my
    predecessor in the previous administration, most of which were
    well taken. Don't get me wrong, but as far as my involvement is
    concernced, I'm very much satisfied with it. Two years ago I
    was not satisfied and expressed that in front of this
    committee, as a matter of fact, but I think it is unprecedented
    at this stage of a development program.
        Chairman Warner. Thank you, Mr. Director.
        General Kadish.
        General Kadish. Sir, I would agree with the previous
    assessments but add just a couple of ideas. I know we say it a
    lot of the time in different ways, but this is a system that
    has to operate in a fire control mode, that is actually real
    time determining what to hit and how to hit it, that crosses
    eight time zones, involves nine satellite communications links,
    many different types of interceptors and locations, is an
    unprecedented achievement.
        We have to adjust some of our normal procedures to handle
    that. When we say we have to build it before we can
    operationally test it along those lines, we really do mean
    that. I think Mr. Christie said we have to put the radars and
    the missiles in the spots that we intend to use as a definition
    of being realistic. That is what this test bed is designed to
    do.
        They are in those positions. We can use them in an
    operational configuration and that's where we are working very
    hard with Admiral Ellis and the warfighters.
        Chairman Warner. I would like to shift to the Admiral to
    finish off on that subject. You are the representative of the
    operational community, and I ask that you assess the value of
    the missile defense test bed in terms of the operational
    utility that it represents, and provide us your assessment
    concerning the viability of using a test bed both operationally
    and for continued testing.
        Admiral Ellis. Thank you, Mr. Chairman. As has already been
    noted, we have been actively involved with this effort now for
    well over a year as these responsibilities came to STRATCOM
    under the realignment. We are chartered to do a MUA and that
    process is ongoing and the first of those elements is in
    review.
        Suffice it to say it very closely corresponds with reports
    that you have seen from Mr. Christie and his elements in terms
    of the technical assessment. We see no technological obstacles
    to successful initial deployment of these capabilities in the
    months ahead.
        From a military utility standpoint, the analysis that has
    been done clearly shows that this will bring a capability,
    admittedly rudimentary and initial, that is of military utility
    and that has even greater potential as the evolutionary
    development that General Kadish and Mr. Christie have described
    further optimizes it in the years ahead. So we are very
    comfortable based on the data that we have seen, and we have
    full access to Mr. Christie's team as well as Ron Kadish's team
    of analysts, where we are working in concert with them to apply
    the operator's perspective on all of this.
        Based on what we have seen to date, we are confident both
    in their ability to begin to deliver this capability before the
    end of the year, and its ultimate utility even as we evolve the
    systems.
        I spoke in my opening remarks about our ability and our
    focus on each element of this weapons system that we are
    designing to have an alert capability, at the same time as we
    are fully supporting the developmental efforts that are
    absolutely critical to continued progress.
        In some cases that involves parallel paths, in other words,
    duplicate networks, if you will. We are beginning to quantify
    operational guidelines and alert states that will allow us to
    structure, as a function of the international security
    environment, our allocation of the elements of the systems to
    testing or to the alert status. We are very confident in that.
    I work very carefully with the regional combatant commanders,
    as you have heard, to assure myself and them that it fully
    meets their requirements as we look to place elements of this
    system on alert in the months ahead.
        So we are confident about the technical side, as well as
    the operational side in our success.
        Chairman Warner. Thank you very much, Admiral. Senator
    Levin.
        Senator Levin. Thank you, Mr. Chairman. We are going to
    circulate a chart showing the scheduled intercept tests which
    were planned prior to the President's decision to deploy, which
    was in December 2002, and then showing all the cancellation of
    those tests.
        If you could take a look at this chart first of all,
    General Kadish, the last intercept test of the ground-based
    national missile defense system took place on December 11,
    2002. The test was a failure. Less than a week after that
    failure, the President announced that he intended to deploy
    this system in 2004.
        Now, prior to the President's decision to deploy three more
    intercept tests were scheduled in fiscal year 2003, followed by
    four more tests in fiscal year 2004. Why were those tests
    scheduled originally? Was there a purpose for them?
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        General Kadish. The purpose of the tests was to continue
    the maturation of the system so that when we reached a point
    after our last test failed for lack of separation of the kill
    vehicle, it had nothing to do with the intercept capability of
    the system.
        We decided that doing further tests of that nature without
    a new configuration that we were actually going to put in the
    test bed was not a good use of the taxpayers' money. So we have
    spent the time focusing on booster tests and things of that
    nature that are more valuable to us, and then we intend to
    start up this year in the coming weeks and months with the
    actual intercept tests as we progress into the test bed
    configuration.
        So the way we manage our tests is to take a look after
    every event to make sure that our plans are going to get us
    where we need to go and adjust for the realities that we face
    and make sure that we are spending our money wisely.
        Senator Levin. Is there any relationship between the fact
    that the President made a decision to deploy in December 2002
    and shortly thereafter, you decided to cancel all these tests?
        General Kadish. No.
        Senator Levin. That is a coincidence.
        General Kadish. It is a coincidence. We deal with this
    every day.
        Senator Levin. That you cancel six or seven tests? You deal
    with that every day?
        General Kadish. Senator, we did not cancel those tests. We
    reoriented them, rescheduled them, put their objectives in
    different pots.
        Senator Levin. Has there been any precedence in this
    missile defense system for delaying seven tests for 2 years?
        General Kadish. I am not sure I understand the question.
        Senator Levin. This is test number 10, I believe. In the
    history of this system, has there ever been an occasion where
    all of the next seven tests were delayed for 2 years?
        General Kadish. I think that when we were into the previous
    Maritime Missile Defense (MMD) program a few years ago after we
    had a failed test, we stood down for over a year.
        Senator Levin. Seven scheduled tests?
        General Kadish. I am not sure how many were scheduled. We
    did not do another test until we fixed that problem, so we want
    to make sure, as is the interest of everyone involved in this,
    that we are testing the hardware to the best of our ability.
    Those decisions are made on a technical basis.
        Senator Levin. The production rate capacity for these
    interceptors is what? How many per year?
        General Kadish. I think we are able at this point in time
    to reach about one per month on an interceptor basis.
        Senator Levin. That is the maximum capacity of production?
        General Kadish. I am not sure it is the maximum capacity.
    That is the maximum rate we are planning right now.
        Senator Levin. Is that called full rate production in your
    budget? Isn't that what is described as full rate production in
    your budget, one per month?
        General Kadish. I think that is just a statement of the
    reality of what we can produce.
        Senator Levin. That is obviously greater than low rate
    initial production, is it not?
        General Kadish. Senator, I have been dealing with programs
    for a lot of years. The definition between low rate initial and
    full production has to do with the idea that you have to build
    these things gradually and you are developing a manufacturing
    process at the same time you are developing the system. So time
    is important. You can't just turn on a spigot and in 2 days
    produce a complex weapons system.
        Senator Levin. Would you agree, however, that full rate
    production is greater than low rate initial production?
        General Kadish. By definition it is.
        Senator Levin. The law says that you must do operational
    testing before you proceed beyond low rate initial production.
    Are you doing any operational testing yet?
        General Kadish. Mr. Christie and I have worked really hard
    over the past few years, and we intend to have every one of our
    tests be operational and developmental in nature. It is already
    underway.
        Senator Levin. You are saying operational testing is
    underway?
        General Kadish. Components of it, yes.
        Senator Levin. Components?
        General Kadish. Of operational testing.
        Senator Levin. OT&E is defined in the law. Are you doing
    that? Here is the definition: a field test under realistic
    combat conditions of any item or key component item of weapons,
    equipment, or munitions for the purpose of determining the
    effectiveness and suitability of the weapons, equipment, and
    munitions. The evaluation of the results of such tests.
        You are saying you are meeting that test?
        General Kadish. At the component level, we are trying very
    hard to do that.
        Senator Levin. At the missile level?
        General Kadish. We don't have the missile that is the
    configuration that we would say is realistic right now. That is
    our next test.
        Senator Levin. Mr. Christie, are they engaged in OT&E, in
    your judgment, as defined by law, at this time? Have they
    engaged in that yet?
        Mr. Christie. At this point in time, I would say no, as I
    understand end to end operational testing. However, I agree
    with General Kadish that, in fact, a lot of the component
    testing that we are on top of has a lot more operational flavor
    than we have had before. But as he says, you know we have had
    problems with components of the missile, and rightly so, those
    tests have been postponed. To do real operational--or more
    operational testing, or testing of a more operational nature,
    let me qualify it in that manner, we need the test bed. We need
    the test bed installed.
        Senator Levin. Therefore, we have not done operational
    testing.
        Mr. Christie. As I would define it, full-blown operational
    testing, no. I think I said that in my report.
        Senator Levin. Let us understand then that the law requires
    before you go beyond low rate initial production there must be
    operational testing. Mr. Christie, who is our expert
    independent on this, says in his judgment it has not occurred,
    and yet you have gone beyond low rate initial production. That
    is an inherent conflict it seems to me here that you and the
    DOD must address.
        Now, you sought a waiver in the DOD last year of that
    requirement. Congress decided not to give you a waiver, and it
    seems to be quite clear you are trying to do something here by
    proceeding to a level of production above low rate initial
    production before you do the operational testing required by
    law.
        You are trying to do it I guess component by component, or
    trying to redefine what operational testing is, but Congress
    specifically said we will not waive that requirement and you
    are proceeding anyway. I think there is a real conflict here
    which Congress and the DOD have to address.
        Mr. Christie. Can I make an input here? I am not sure that
    I would consider 12 missiles a year, or 1 a month beyond low
    rate, to be full production.
        Senator Levin. What is beyond low rate?
        Mr. Christie. I am not sure in this program. Beyond low
    rate is different for every program.
        Senator Levin. I think you should decide then what is
    beyond low rate.
        Mr. Christie. That is usually a decision to be made by the
    acquisition executive.
        Senator Levin. General Kadish said by definition we are
    beyond low rate.
        Mr. Wynne. Senator Levin, low rate initial production of
    one a month sustains a warm line. I would say that hopefully we
    will never have to use these rockets before their time, but
    with the amount of time it takes to develop and use these and
    introduce the new times, I think sustaining a warm line base of
    one a month is not a full rate production.
        In fact, I would tell you that just based on our experience
    in OIF, we have had to go to enormous additional capacities as
    these things have produced into use. I do not believe that this
    is a rate production issue.
        Senator Allard. We need to move forward.
        Senator Dole.
        Senator Dole. Thank you, Senator Allard. I want to thank
    our distinguished panel not only for being here today, but for
    the great work that you're doing leading our national effort to
    field a capable BMDS as soon as possible. The need for this
    capability is becoming increasingly clearer considering what we
    have learned regarding the proliferation of weapons and the
    established programs such as North Korea's.
        Presently 36 countries possess ballistic missiles, of which
    25 either possess or are acquiring nuclear, chemical, and
    biological weapons. It is quite apparent that we cannot rely
    solely on traditional arms control agreements to ensure the
    safety of the American people.
        Though much remains to be done, it is important for us to
    appreciate the significant progress the United States has made
    in missile development. This has been a long road dating back
    to World War II when the V-2 missiles first fell on Paris and
    London. Since then the United States has developed numerous
    systems designed to shoot down missiles, but establishing a
    system to protect the entire country has been a formidable
    challenge.
        In less than 1 year the United States is scheduled to have
    an initial capability through its fielding of the ground-based
    midcourse defense system. We have discussed at length how the
    major pieces of this complex endeavor such as facilities,
    interceptors, trained operators, and the communications
    infrastructure are planned to be in place for an initial
    operating capability this year.
        General Kadish, Mr. Wynne, and General Dodgen, what are the
    most significant challenges that could threaten attainment of
    this goal?
        Mr. Wynne. Senator, I would tell you that one of the
    largest challenges we have is making sure that our solid rocket
    motor development proceeds in a safe and direct manner. We were
    not pleased to discover that we had lost one of our suppliers
    in that regard as a result of coincident explosions in the
    chemical systems division.
        In a program like this, I would also say that the upgrades
    are going on, the MUA is proceeding. Every time we do conduct a
    test, we give feedback to our engineers. I think we are right
    now very confident with every day that goes by we obtain more
    data and we make re-evaluation of what, of when, and where.
        Right now, we are stressing to you our confidence and our
    current confidence is real.
        Senator Dole. General Kadish?
        General Kadish. I would agree with Mr. Wynne. Every day we
    are doing a lot of testing and working with the using
    community, and right now a surprise of some sort, or a big
    mistake could affect our ability to proceed.
        But so far, when those have happened to us, as Mr. Wynne
    said, with the explosion at our solid rocket plant, our
    strategies and our ability to overcome that have been in place
    to deal with it. So that is why I can say we're on track right
    now. But every day brings a new opportunity.
        Senator Dole. General Dodgen.
        General Dodgen. Senator, the biggest challenge for us was
    bringing online Fort Greeley and the soldiers that will man it.
    So the pace of work over the past year and a half has been
    tremendous, but I am happy to say that those things are on
    track now and the soldiers are falling in and Fort Greeley has
    been removed from the Base Realignment and Closure (BRAC) list
    for missile defense purposes and that is all coming together
    very well.
        Senator Dole. Thank you. With recent media reports stating
    the missile defense testing may be inadequate and the system
    ineffective, it is important for the American people to have
    confidence in the protection this system will provide. I
    understand that your testing programs are designed to provide
    this confidence by integrating a comprehensive and phased
    approach which repeatedly incorporates levels of complexity.
        While much of the debate focuses on flight tests, I also
    understand this is only one facet of your testing programs. How
    do ground tests, flight tests, and systems capability analysis
    work together to form the basis for an overall system
    assessment?
        Mr. Wynne. Senator, I would tell you that have we long
    relied on simulation and component to component, man in the
    loop testing to proof out componentry. I would also advise that
    we are putting into practice a lot of the capabilities of our
    test community as we expand this ground-based test bed up in
    Fort Greeley, and combine it with Vandenberg and combine it
    with the Aegis test system across the eight time zones as
    General Kadish had mentioned.
        All of this, though, is a continuous building of confidence
    that the end vision of a great layered defense to prevent a
    surprise or even inadvertent attack is coming together.
        Senator Dole. The initial capability of the missile defense
    system will focus on destroying a missile while in the
    midcourse segment of flight. The BMDS as envisioned will not
    focus on a single capability. Instead, it is intended to have
    multiple layers of defense and the ability to destroy missiles
    while in any stage of flight.
        General Kadish, could you explain why you are pursuing
    boost phase capability and what it would bring to a layered
    defense? Please discuss any plans you may have for space-based
    components or any movement towards space-based capabilities
    such as kinetic energy boost phase interceptors.
        General Kadish. Senator, we have very few dollars in the
    budget at this point to handle a space-based capability at all.
    Our primary focus is all terrestrially-based in our efforts.
        I think you point out something very important. A layered
    integrated defense is absolutely key to the success over time.
    Now, the midcourse we have just talked about. In the boost
    phase prior to the Anti-Ballistic Missile (ABM) Treaty, or
    during the ABM Treaty days, we had specific prohibitions for
    doing much in that area, and therefore once we started
    exempting afterwards, we came up with the idea that a kinetic-
    based boost phase capability, along with an airborne laser
    using the speed of light would be a tremendous addition to our
    capability to defeat missiles.
        It is a very simple concept that the earlier you shoot at a
    target and the more often you shoot at the target, the more
    chance you have of making sure it doesn't get through. That's
    the fundamental layer of the concept. The boost phase will be
    coming later based on the fact that we have to do more with
    experimentation for it to be a critical addition to that
    ability.
        Senator Allard. Thank you, Senator.
        Senator Lieberman.
        Senator Lieberman. Thank you, Mr. Chairman. Thanks,
    gentlemen, for being here today. I have been a strong supporter
    of the development of national missile defense because I do
    think that the threat to us is real and is growing. I was one
    of the original co-sponsors of the 1999 legislation that you
    described. It was very brief. The stated policy of the United
    States is to deploy as soon as technologically possible an
    effective system capable of defending the territory of the
    United States against ballistic missile attack whether
    accidental, unauthorized, or deliberate.
        Then it said the funding is subject to the annual
    authorization of appropriations and the annual appropriation
    funds for national missile defense. I always thought, as one of
    the co-sponsors, that meant exactly what is happening here
    today.
        We would have an annual evaluation of the threats of the
    reality and urgency of a missile threat as compared and related
    to the other threats to our security that we face. That would
    determine how much money we would put into the system and how
    quickly we would fulfill the words here, to deploy. Of course
    it says ``technologically feasible.''
        So Secretary Wynne, because you have DOD-wide
    responsibilities, I want to ask you if you can share with us
    the judgements that were made by the Pentagon and the
    administration about the relative urgency of the threat of
    ballistic missile attack as compared to the threat of
    terrorism, other attacks that our country faces, to justify the
    very significant investment that the administration is asking
    us to make in this system, which as Senator Levin said in some
    sense may be unprecedented.
        Mr. Wynne. Thank you very much, Senator. The National
    Defense Authorization Act for Fiscal Year 1999 is an
    extraordinary step forward. This is not just about quality of
    the threat. It is about the quality of the catastrophic effect
    of not having a defense in this situation.
        So I think it is on a relative basis, it is almost like the
    probability of the occurrence times the type of effect that may
    occur could balance out the investment. This investment also
    has a certain amount of urgency, which makes it important over
    the course of a 20-year span in the sense that you are striving
    right now to put together the essence of it and of a fairly
    robust R&D program to make that happen.
        Those having been coupled together create a seeming
    imbalance, but not over the long term, about deterring
    strategic foes versus deterring tactical foes versus deterring
    economic foes.
        Senator Lieberman. Excuse me for interrupting. Is it fair
    to say that you are stating here that the Pentagon and the
    administration went through a process of balancing all the
    other systems that come out of your office, and that we are
    investing a justified $10 billion for the system?
        Mr. Wynne. I believe it does, sir. What we go through every
    year is a rigorous budget buildup that goes through many
    reviews as to how we invest in some of the resources. The
    comptroller will probably be a more formal, eloquent speaker on
    the topic.
        Senator Lieberman. Let me go to the second question that I
    have and it relates to the questions that Senator Levin has
    raised. Senator Levin correctly says that we have a
    longstanding principle here, we fly before we buy. To some
    extent, Mr. Christie, it's a sensible principle.
        Mr. Christie, you are amending that for the system and say
    you have to build before you can test, in that sense, before
    you can fly, to use the expression. It puts us in an awkward
    position.
        I want to see if I understand whether you are saying one,
    that we are going to declare initial operational capability
    (IOC) for the system in September or at the end of the year or
    whenever it begins. If so, doesn't that mean that IOC is going
    to be achieved before operational testing occurs? Is this
    related to the discussion with Senator Levin earlier about what
    low rate initial production is?
        You are saying that your judgment is that the Pentagon is
    living within the law in the testing that has or has not been
    done so far in this proposal.
        Mr. Christie. Yes, I think it is living within the law. I
    do not characterize what will happen sometime later this year,
    when we will have IDO, as an IOC in the classic sense of
    introducing a weapon system across the board into our forces.
        Again, we are building a test bed. We will install
    interceptor missiles in silos at two different locations from
    where they have been in the past that will be useful in the
    case of an emergency.
        Senator Lieberman. Would you have the same judgment about
    the 20 additional interceptors we are being asked to fund this
    year prior to the kind of operational testing that would seem
    normally to be required?
        Mr. Christie. From what I understand, we are buying or
    manufacturing missiles that will be used, for the most part, in
    testing.
        Senator Lieberman. That is the first one we already funded,
    but the second one as well.
        General Kadish. Could I explain that, sir? I believe the
    $500 million request we have is for 10 missiles in the 2005
    buying period, so it is not the full 20. Every year we are
    going to evaluate this. It certainly adds to the uniformity of
    the test bed, but in the meantime we are going to be testing
    some of those missiles and using them up, so how that is going
    to turn out in terms of how many missiles we have for an actual
    alert posture will change almost monthly.
        The idea of fly before you buy is very difficult for this
    system. Every generation or so, there comes a time where a
    system of this type that is technologically unprecedented or so
    useful that you have to take it out of the normal understanding
    comes up. Fly as we buy is basically the way we have done that.
        Senator Lieberman. The reason I think you are all set for
    that is that you cannot fly. I am using the phrase fly it
    before you build it. You cannot use it until you test it.
        General Kadish. Yes.
        Senator Allard. Senator Inhofe.
        Senator Inhofe. Thank you, Mr. Chairman. As I listen to
    General Kadish, in your opening remarks, and I am reading off
    your statement, ``we feel that we have an improved system.'' I
    sense an urgency in that statement, that he is recognizing that
    this is something that we need to get up there and get working
    even if it is not perfected, and I totally agree with this.
        I appreciate very much Senator Lieberman and his activity
    in seeing to it that we are going to ultimately have a system
    that is going to defend our American cities, and I applaud him
    for that. However, when you talk about the relevant threats
    between terrorists, I have a hard time with that because the
    ultimate weapon of a terrorist would be a missile with a
    warhead that would kill a lot of people.
        I think back and I can remember, General Kadish, that you
    were actually before this committee back in 1998 when we asked
    the question, how long will it be until this threat is imminent
    in the United States? How long will it be specifically, and I
    remember asking the question, August 24, 1998, would it be
    until the North Koreans have reached the United States? The
    response was simply: In the range of 5 to 10 years. Seven days
    later on August 31, 1998, they launched them.
        That threat is out there. We know it is there. We know
    these are not stable people. So I hope we will all realize that
    when you look back on the days of conventional warfare where
    you make the wrong decision and wrong timeline it might cost
    200 or 300 lives. But in this case it could be 200,000 or
    300,000, so I believe that sense of urgency that the President
    has charged you with is one that you are responding to in a
    very forceful way.
        As I looked at the system, we are talking about two things.
    First, we have to detect and we have to kill it. There are two
    projects that we have going at the same time. You change the
    names on me all the time so I cannot keep up, but I have a
    similar system. You are up there and you are looking down, as
    opposed to their system where you are down and looking up, and
    it should have the capability of detecting and processing
    information.
        Ultimately that is where we want to be. We transition into
    this system, which I think is the same thing in partnership
    with the Russians, and that has now been terminated. My first
    question is, what will that termination do, and will that
    affect the timeline of ultimately having the system of
    protection?
        General Kadish. The short answer is no, Senator. We changed
    the names to Space Tracking Surveillance Systems (STSS) to have
    no confusion between what we used to have, Space-Based Infrared
    Radar System (SBIRS)-Low or SBIRS-High which are still two
    different programs. But the Russian American Observation
    Satellite (RAMOS) program, although it would explore some of
    the technology we could use for the STSS or SBIRS component,
    was not critical to the performance of that program.
        Senator Inhofe. I see. I have been told my microphone is
    not working, but you obviously did hear the questions and the
    comments. Now, I understand that the MDA has had great success
    in using the air system of detection which is down here looking
    up. It is something I have always thought in my mind is kind of
    an interim system of detection until we have the system we have
    been discussing. Is that accurate?
        General Kadish. That is true. Although, today, we use the
    Defense Support Program for the initial detection. That is
    already on orbit and uses the same technology. So we are
    planning and working very hard to continue to put infrared
    capability in orbit through the STSS, and we are currently on
    schedule to put up our first two proof of principle satellites
    in the fiscal year 2007.
        Senator Inhofe. The 2005 budget estimate states that once
    the test evaluations are complete, then the management and
    security of the sites will be transferred to the individual
    Services. In this day and age of jointness and all that, have
    you thought about whether that is more efficient and effective
    than if you were to do it in one place under one control or one
    joint control?
        General Kadish. Senator, that is a good question. Admiral
    Ellis, General Dodgen, myself, and others are working to see
    whether or not our original understanding of that process is
    right or whether we need to change it. I do not know if I
    overstate this, but I do not think I do. This effort that we
    are doing at Fort Greeley, the initial IDC configuration is
    truly a joint development and fielding activity, more than I
    have ever been associated with in my acquisition career.
        We are kind of inventing new processes here, if I could say
    that.
        Senator Inhofe. It is something to think about as we move
    along. Now, going from the detection to the kill part, the ABL
    weapons system, which consists of a laser mounted on a modified
    747, what is the current timeline for the fielding of the ABL
    system? I have been interested in timelines to meet this
    concern of emergency that I believe is there.
        General Kadish. Well, we have run into some integration
    problems on the ABL. It is extremely complex technology,
    revolutionary, even more so than hit to kill was a few years
    ago, I believe. So I am not able to at this time give you what
    I would call a high confidence answer to that question in terms
    of time.
        We have about the last 20 percent of the first airplane to
    prove our principles on whether that laser combination with the
    airplane is going to work correctly. Once we get our next two
    milestones, which are laser light out of the ground-based
    system test laboratory and flying activity of our lenses, I can
    give you a better estimate. But it will be no earlier than 2005
    or probably a little later than that. No earlier than that.
        Senator Inhofe. I know my time has expired. I do have some
    other timeline questions. I'm going to ask for response on the
    record. Thank you very much to all five of you for the great
    service you're performing.
        Senator Allard. Thank you. Next is Senator Reed.
        Senator Reed. Thank you very much, Mr. Chairman. General
    Kadish, in your written testimony you say, ``it is important to
    understand that in the missile defense program we use models
    and simulations and not flight tests as primary verification
    tools.'' But Mr. Christie, in your recent report to Congress
    you point out, ``due to the immature nature of the system,
    models and simulation with ballistic missile defense system can
    not be adequately validated at this time.''
        You also say in your prepared testimony today, ``modeling
    and simulation are not a good substitute for integrated system
    testing.'' There seems to be a variance here on views about
    modeling and simulation.
        But is it fair to say, Mr. Christie, that the Missile
    Defense Program is neither fully integrated nor mature enough
    to develop models and simulations that can be validated as
    correct?
        Mr. Christie. That is right, sir.
        Senator Reed. So when we simulate a launch of a North
    Korean missile against the United States, this simulation
    cannot be shown to be fully correct yet because the system is
    still too immature?
        Mr. Christie. I did not understand the question. I cannot
    hear you.
        Senator Reed. Let me repeat it. If we simulate a launch of
    a North Korean missile against the United States, this
    simulation cannot be shown to be fully correct yet because the
    system is still too immature?
        Mr. Christie. I would say that. But as we go on during this
    year, we will mature some of the components of this test bed
    that will form part of the IDO, and then we will have more
    confidence in the ability of the systems to act as they were
    designed. As of right now, no.
        Senator Reed. But at this time, we cannot be sure that the
    actual system would work against a real North Korean missile
    threat?
        Mr. Christie. I would say that is true. At this point in
    time, that is true.
        Senator Reed. The next major flight test of the ground-
    based missile defense system is called IFT 13C. According to
    the official test plan provided to Congress, IFT 13C will use
    global positioning system (GPS) to guide the interceptor to the
    target. The target has a GPS receiver on it, and it broadcasts
    its position down to the missile defense system.
        I think it is safe to say that a real threat would never
    have a GPS broadcasting its position down to the defense
    system. General Kadish, you plan to deploy the system in
    September. Do any of the tests between now and September not
    include this GPS device to signal the presence of the target?
        General Kadish. First I would like to say why the GPS
    system is on the target. It is for safety purposes to make sure
    that we can control the flight test properly.
        Senator Reed. It has nothing to do with cuing the target--
    --
        General Kadish. That is the primary reason why the GPS is
    on the target. The secondary reason is that we are not able to
    have the radar in the right spot for this test. An
    operationally useful spot. That's why we need to build the test
    bed, to some degree.
        So our only method of actually simulating that sensor is
    for the GPS process to provide that input. But it will provide
    that input just as the sensor that we are simulating would.
        Senator Reed. When will the sensors that you are simulating
    be in place?
        General Kadish. They will never all be perfectly aligned in
    any test that we do. I cannot remember the exact date. Over the
    next 18 to 24 months, we are going to remove much artificiality
    in the test and make them as realistic as we can.
        Senator Reed. When will these sensors be in place so that
    you do not have to rely upon a GPS?
        General Kadish. For testing or for operations?
        Senator Reed. First the testing.
        General Kadish. In testing, I think--I would have to get
    you the answer to that question, I just don't remember.
        [The information referred to follows:]

        We will continue to use GPS for flight safety. GPS will not
    contribute to the Weapon Task Plan on tests where we have censors such
    as Aegis, UEWR, or SBX available in the test bed. This will first occur
    in mid calendar year 2005.

        Senator Reed. Is it safe to say it's after deployment,
    after September?
        General Kadish. We are doing a lot of testing. I just don't
    know.
        Senator Reed. That's a very unsatisfactory answer, General.
    I mean, you tell me you are planning these tests out many
    months in advance. You know you are deploying in September. It
    is very simple. Are you going to be using the GPS?
        General Kadish. But Senator, I do not look at the test
    program before or after IDO as an end point or start point. I
    look at the test program for the next 5 years.
        Senator Reed. General, this is a very simple question. Will
    you be using this GPS on the target missiles after September
    deployment dates?
        General Kadish. To some degree, I think we will. I just do
    not know the details.
        Senator Reed. So we are deploying a system which we cannot
    simulate through validated simulations of a North Korean
    attack, and we rely upon GPS for engagement. It just confounds
    in my mind the idea of deploying the system. Testing it is
    something. But standing up there and saying this deployed
    system that will protect this country against a real threat
    stretched my imagination.
        Let me go on. We have heard a lot of testimony today about,
    Mr. Christie, your operational test organization. I have a
    quote from the plan submitted to Congress about IFT 13C: ``IFT
    13C is a prime contractor planned and joint program office
    approved development test. Because of prime contractor and
    joint program office constraints, little opportunity exists for
    input of unique operational test agency team requirements.''
        What this suggests to me is that you are not controlling
    these tests at all. The contractors are controlling the tests.
    BMD is controlling the tests.
        Mr. Christie. BMD is controlling the tests. I am not
    controlling the tests, because they are developmental tests. We
    are quite successful, I think, in getting more operational
    ingredients into these tests. But these are R&D tests.
        Senator Reed. I think that is right. But I heard the
    dialogue before in response to Senator Levin's question about
    whether they are development tests or operational tests. There
    are some development parts, some operations part.
        One of the key aspects of an operational test is that you
    control the tests, not the contractors. So this quibbling about
    what is operational and development has to be settled. These
    are developmental tests.
        Mr. Christie. That is right.
        Senator Reed. Thank you.
        Senator Allard. Thank you. It is my turn to ask a few
    questions. I will go ahead and proceed. On this adequate
    testing, I have a schedule, and it is called ``events schedule
    on testing.'' It looks to me like you have at least 20 tests
    scheduled for the rest of this year. For next year, a large
    number of tests, 22 or so. Seems to me like that is a pretty
    heavy test schedule out here, and my question is to General
    Kadish, how many flight tests have been conducted in 2004 so
    far?
        General Kadish. 2004, of all types?
        Senator Allard. Yes, flight tests.
        General Kadish. I think we have done at least five or six.
    I would have to get the exact number.
        [The information referred to follows:]

        If the question refers to fiscal year 2004, since October 1, 2003,
    there have been two intercept tests. One Aegis and one Patriot. Both
    were successful. During the same period we conducted two non-intercept
    flight tests of ground-based midcourse boosters. Additionally, we have
    participated in two tests of opportunity by aiming our sensors at Air
    Force Space Command launches.
        In calendar year 2004 thus far we have conducted two booster flight
    tests and one Patriot intercept test.

        Senator Allard. Were they successful?
        General Kadish. Yes.
        Senator Allard. How many more are planned for this year?
        General Kadish. We have flight tests and intercept tests, I
    think three more. If you count the other flight tests for other
    elements of the system, I think there are three or four others
    of that nature.
        Senator Allard. Thank you. Admiral Ellis, STRATCOM has
    adopted a number of new missions recently, including
    information, operations, computer network attack, computer
    network defense, and space operations.
        In addition to the mission of global strike, integrating
    these new missions would be a huge workload, I think, for any
    organization. Has this workload impeded your progress in any
    way in preparing for the missile defense IOC?
        Admiral Ellis. No, Senator. It has not. We have had a great
    deal of support from the elements of what formally comprised
    the United States Space Command as we brought them under the
    STRATCOM umbrella. We have been able to engender a great deal
    of support from elements of our components who have expertise
    in these areas, including the Joint Theater Air and Missile
    Defense Organization (JTAMDO), Air Force Space Command and the
    like. That, coupled with the priority that we ascribe to this
    effort, and this timeline that we're on have allowed us to
    effectively balance the apportionment of resources to ensure
    that we, in our role, contribute as fully as possible to its
    success.
        Senator Allard. So there have been synergies there in
    preparing for an integrated defense?
        Admiral Ellis. Absolutely, sir. In fact, as you think about
    it, many of the things we are talking about have a deterrent
    character to them and are a part of effective information
    operations in a real sense. So we are very satisfied with that,
    coupled with our space responsibilities that deal with the
    sensors that General Kadish was speaking of earlier. So there
    is a very synergistic effect that comes with bringing not just
    the systems and the platforms, but the overall mission
    responsibilities, together in a single global organization.
        Senator Allard. Now, I want to get back to you, General
    Kadish. Now, Senator Levin feels that you are in full rate
    production of the ground-based interceptor and therefore
    operational testing is required.
        Senator Levin. Would you yield on that? I have not said
    they are in full rate. I said that they are beyond the initial
    rate.
        Senator Allard. Okay. I am glad you clarified that for the
    record, because we understood that you had. Let me go ahead and
    continue with this question. Is the interceptor synonymous with
    the system?
        General Kadish. Everybody thinks so, but it is not in my
    view. When you look at the radars, communications links, and
    ships involved, the interceptor is just one component.
        Senator Allard. You do operational testing of the
    interceptor independent of the BMDS?
        General Kadish. Not in my opinion, Senator.
        Senator Allard. Thank you. Mr. Christie, I have a question
    here. Are you satisfied with the working relationship with the
    MDA and that your organization's voice is heard when missile
    defense plans are crafted?
        Mr. Christie. I am, sir. Yes, I am.
        Senator Allard. I have a question now for the whole panel.
    Do any of you feel that there is not adequate testing going on?
    Is there any reason to believe there is not adequate testing?
        Mr. Wynne. No, sir. I think the type of testing is
    extraordinary for the eight time zones and the lay down of the
    test bed.
        Admiral Ellis. I am quite satisfied, sir.
        Mr. Christie. I would always want more testing. I have to
    admit to that.
        Senator Allard. But from a practical aspect----
        Mr. Christie. From a practical aspect, with this particular
    program, and the complexity of it, General Kadish has, in fact,
    postponed several tests because of the problems that have been
    uncovered. That is the very purpose of development testing--
    test, find out if you have problems, and fix them before you go
    too far.
        Senator Allard. I think that is a reasonable approach. I
    think it is unrealistic to think that during testing you are
    not going to have failures. In my view, if you do not have
    failure you are not pushing the system. You need to push the
    system to know what the limits are.
        General Kadish, do you think we have enough testing?
        General Kadish. I think we have adequate testing. I am
    looking for every chance to do more.
        Senator Allard. General Dodgen.
        General Dodgen. I am satisfied with the testing, Senator.
        Senator Allard. Let me talk a little bit about
    international cooperation, General Kadish. I understand that
    the United States and the U.K. recently signed a formal
    memorandum of understanding and agreed to upgrade the
    Fylingdales radar facility. I also understand Japan recently
    agreed to provide nearly $1 billion for their own sea-based and
    ground-based missile defense in cooperation with the United
    States.
        We are negotiating a BMD framework with Australia and
    redefining our cooperative defense agreements with Canada. It
    seems to me that the ballistic missile threat is a global
    problem that requires a global solution, therefore I applaud
    your efforts to build a cooperative relationship with our
    allies.
        Can you expand upon your vision for international
    cooperation on missile defense?
        General Kadish. We have been working with Mr. Wynne and
    others across the world to find out exactly what we could do.
    Because fundamentally, the geography counts in missile defense.
    Where we put things is important. They are important to
    ourselves and with our allies.
        So the objective here is a confluence of interests between
    our international partners and allies and our needs for missile
    defense. That is where we are going. We have long-range money
    in the budget to try to make that happen.
        I would not underestimate the difficulties, however, in
    making those arrangements successful. International
    partnerships and cooperative development activities are
    important but very difficult.
        Senator Allard. Senator Akaka.
        Senator Akaka. Thank you very much, Mr. Chairman. It is my
    understanding that the radar you intend to use for the missile
    defense deployment starting in September cannot protect Hawaii
    from a long-range missile attack. In order to protect Hawaii,
    you plan to use existing ship-based radars which we understand
    are much less powerful than normal BMD radars and were never
    designed to track long-range missiles.
        General Kadish, with no help from the GPS, how many live
    target intercept tests have you conducted to date using only
    ship-based radar to track a long-range target?
        General Kadish. We have done many tests of the different
    parts of that radar system in Aegis that convince us we can do
    this mission with Aegis radar systems. We have tracked long-
    range targets, and I have to point out that we would like to be
    a little bit further along in that. However, prior to the ABM
    Treaty withdrawal, we were prohibited from using those radars
    in that regard.
        We have just done a review, I guess it was last week, that
    looked at the capability of Aegis to perform this mission. We
    are all comfortable that it will work based on the testing we
    have done to date.
        We have set up a test set over the next 18 months that will
    actually prove those things more in what we call an end-to-end
    fashion, and use it against a live warhead. We are not to that
    point yet, but this is part of our evolutionary upgrades. But I
    think we will have that capability rather soon.
        Senator Akaka. Have you conducted live intercept tests?
        General Kadish. Not as of this date using that full
    engagement sequence. I would prefer to get into more classified
    arrangements before I talk further than that. Senator, I would
    be glad to do that with you at any time.
        Senator Akaka. Mr. Christie, I am concerned about Hawaii.
    Should I feel confident that the State of Hawaii will be
    protected by this system starting in September?
        Mr. Christie. We have not done a thorough analysis. That is
    one of the scenarios that we are looking at. At this point in
    time, I cannot say one way or another. I am not saying we are
    not confident in stating that, but that is one of the
    engagement scenarios that are being looked at in the
    operational assessments-- the continuing operational
    assessments that will go on between now and the end of the
    year.
        So I cannot comment on that at this point in time.
        Mr. Wynne. I would like to add, Senator Akaka, that the
    great State of Hawaii is certainly included in the defense of
    the United States, and we are making every move to make sure
    that we have extended the umbrella of protection to the great
    State of Hawaii.
        I think General Kadish has said it best. We have a few
    engagement scenarios that in fact are complicated to try and
    make sure that we have adequate understanding of the mission. I
    think Mr. Christie is correct in saying that until he gets a
    detailed evaluation of that particular engagement scenario, and
    that is how they are doing their testing, he cannot and
    probably will never be able to tell you in an open forum
    exactly the level of confidence that you can create. But I will
    assure you, sir, that we are, in our evolutionary design, have
    the great State of Hawaii always in mind.
        Senator Akaka. Admiral Ellis, you have the responsibility
    of protecting all of the 50 States from missile attacks. I am
    concerned about ship-based radar protection, so my question is,
    what kind of plan do you have especially for Hawaii? Do you
    plan to have a Navy ship in this case on station 24 hours a day
    to protect Hawaii from long-range missile attacks starting in
    September?
        Admiral Ellis. Thank you, Senator. I want to echo Mr.
    Wynne's comments. Based on my extensive time in the Pacific, I
    fully understand and appreciate Hawaii's unique location and
    contributions to our national defense. As has been noted, it is
    an essential element within the defended area that's been
    described for the system.
        We are very mindful of the demands of the various intercept
    geometries that both Mr. Christie and Mr. Wynne have talked
    about. One of my roles as a combatant commander, as you are
    fully aware, is to provide capabilities to Ed Eberhart at
    NORTHCOM and to your friend Tom Fargo at PACOM to ensure that
    they have all the tools they need to appropriately defend the
    United States territory within their area of responsibility
    (AOR).
        Now, from a Navy perspective, as you have heard from Ron
    Kadish, Navy ships will be on station for their initial search
    and track capabilities and contribute to the sensor net that
    Mr. Wynne spoke of. That will enable the employment of the
    interceptors that have been described as an essential element
    of this system.
        So there will be Navy ships involved in contributing to the
    effectiveness of the entire network, and that entire network
    will then contribute to our ability to defend all of the United
    States from this threat, and that includes, of course, Hawaii.
        Senator Akaka. Thank you for your responses. Thank you, Mr.
    Chairman.
        Senator Allard. Call on Senator Sessions.
        Senator Sessions. Thank you, Mr. Chairman. I am delighted
    to have each of you with us. Admiral Ellis, it is good to see
    you again. General Kadish, we appreciate your service. General
    Dodgen, it is a delight to have you here, as well as Mr. Wynne
    and Mr. Christie.
        A lot of good things have happened. A lot of us believe
    strongly that we needed to move to a national missile defense
    program. We had a debate on that in the late 1990s. As Senator
    Lieberman indicated, he and a number of us joined that issue.
    In 1999 we voted overwhelmingly, and President Clinton signed a
    policy of the United States to deploy as soon as feasible a
    national missile defense system.
        Our goal was to do so by September of this year. I believe
    that was the date, and I know it is about 200 days from now,
    General Kadish. Can you tell us how we are looking for
    September of this year in a deployment of a system? If you are
    able to do so, will it provide additional protection to this
    country from a missile attack?
        General Kadish. Senator, the September date was an internal
    planning date for the test bed. I can tell you that based on
    where we are today, we are on track for the general time frame
    that we set in motion. As with most programs of this nature, we
    are trying to figure out how to make sure that we either do it
    earlier or on our internal schedules. That is what we are
    trying to do today.
        Despite some setbacks, we may not have as much equipment
    available as we thought on a specific date, but by and large,
    most everything is going to be in place and then we will work
    with the senior leadership of the DOD to see how much
    protection that would afford us, and so we are on track.
        Senator Sessions. There was a lot of controversy early on
    about the hit to kill technology. Are you satisfied now that
    that is a proven capability?
        General Kadish. Yes.
        Senator Sessions. If you are testing as it continues, and
    it is very robust as that testing continues, are you able to
    make adjustments and will you be willing to slow down and make
    changes if need be?
        I believe we utilize the theory of spiral development. As I
    understood it from the very beginning, that said that you would
    wrestle with each problem that came up and try to overall make
    the system work, rather than trying to design a system from
    beginning to end at the start and doing it whether it worked or
    not.
        Are you happy with that philosophy and are you prepared to
    deal with any difficulties that arise?
        General Kadish. Again, the short answer to that question,
    Senator, is yes. I believe we have been able to make the
    progress we have made over the last few years because we have
    adopted that philosophy. We have taken action in many cases,
    not only in the test bed construct we have been discussing, but
    in programs like ABL and THAAD and the boost program we have
    put in to reduce our cycle time in decision making to make the
    overall effort better.
        I believe that the strategy is absolutely correct for this
    type of program. It may not be correct for every program, but
    for this one that I deal with every day, it is working very
    well from my perspective.
        Mr. Wynne. Senator Sessions, if I would add that the
    position of the Secretary is this is an event-driven program,
    that we will follow the disciplines and the quality procedures
    and make sure we have the MUA, and test reports. I think even
    the date, if there ever is a date which we do not have a date
    certain right now, it will appear because there is a MUA that
    has been completed and reported.
        Senator Sessions. Mr. Christie, you have looked at this
    from a critical eye, as you should. We hope you are. Do you
    observe any technological or other problems that would keep us
    from eventually solving the challenges that face us with regard
    to establishing a system that would work?
        Mr. Christie. At this point in time, no, I see no
    technological issues that have jumped up that say we are not
    going to be able to do this or that.
        Senator Sessions. There are problems, and we need to deal
    with them.
        Mr. Christie. There are problems.
        Senator Sessions. Testing reveals those?
        Mr. Christie. I would hope so, and I think the fact that we
    are being criticized, maybe rightly so, for having less tests
    during this last year--that reflects that philosophy that we
    found some problems and we have postponed the schedule, we
    scheduled tests in order to take care of those problems and to
    have some confidence before we put the system back into test
    that we have solved the problems.
        Senator Sessions. You favor that slowing down rather than
    pressing forward in some artificial way?
        Mr. Christie. Absolutely, sir.
        Senator Sessions. General Kadish, if the budget were to be
    reduced for national missile defense, how would it impact your
    ability to do adequate testing and research if need be?
        General Kadish. Senator, it would slow us down, depending
    on what the nature of the cuts were. We balanced out the
    program to the best of our ability, and we have made
    consistent, and I believe rapid progress in many areas. If
    Congress continues to fund us, we will continue to make that
    progress.
        Senator Sessions. I want to congratulate you. Thank you for
    your good work. I appreciate the work of General Nance and
    Major General Holly in Birmingham, who worked on that
    deployment. It appears to be on time. A lot of people said it
    could not be done. You are about there. I think it is an
    extraordinary accomplishment, Mr. Chairman. Really, the
    American people have not appreciated the immensity of the
    challenge, technologically and just infrastructure-wise, and
    they have done it and on time. I believe that if a problem was
    revealed it will be met and overcome.
        Senator Allard. As I am calling on Senator Nelson from
    Nebraska, Admiral Ellis, I hope you are prepared for the
    question of whether you are going to root for the Big Red, or
    are still in support of the Colorado Buffalos.
        Admiral Ellis. Yes, sir. I have been torn in those
    directions before.
        Senator Ben Nelson. Thank you, Mr. Chairman. I want to
    thank all of you gentlemen for what you are doing for our
    national defense and for the difficult nature of research,
    development testing, deployment. Things always seem to blend
    together, and I was taken by what General Kadish said, fly and
    buy, but sometimes you are flying and buying at the same time
    because of the need to have the equipment for further field
    testing.
        Admiral Ellis, as a fellow Nebraskan, it is good to have
    you here. I appreciate so much what you are doing there in a
    very difficult time frame to integrate all the kinds of things
    that have to go into bringing offensive and defensive positions
    together. So thank you.
        One of my questions is, I think this will probably go to
    General Kadish. Fort Greeley will be obviously the first
    fielded missile defense site, but is it also a test bed? I
    think we are really trying to understand where we are in
    testing and how it blends or morphs into a national defense
    posture.
        General Kadish. Senator, you are correct. It is also a test
    bed because we were going to put the system together to watch
    it operate on a daily basis, we will gather that data to
    improve the system. Vandenberg Air Force Base will also have
    some missiles and they will do the same there.
        In fact, we have plans to fly out of those silos at
    Vandenberg in an operationally realistic testing effort. So
    again, we have to build it before we can test it in an
    operationally capable way. Fort Greeley is that location, as
    well as Vandenberg, Shemya Island out in the Aleutians, and
    ships at sea.
        Senator Ben Nelson. So is it fair to say that we are buying
    to test rather than buying to stockpile weapons?
        General Kadish. In some sense, we are doing both at the
    same time.
        Senator Ben Nelson. Well, that would take me to Mr. Wynne.
    I know that in testing, we try to reach the goal of perfection,
    but never expect anything to be quite perfect. Given the
    experience with the Patriot system and deployment, do you think
    that we are going to get better results percentage-wise with
    the missile defense system than we have gotten with the Patriot
    system?
        I am not going to ask you whether it is 10 percent accuracy
    or 50 or 60 percent except in a classified setting. But are we
    going to get to a point where field testing or deployment
    testing in some way gets us a better result? A better
    percentage, anyway.
        Mr. Wynne. I will compliment the PAC-3 and let Lieutenant
    General Dodgen talk about it, but it has gotten tremendously
    better as time goes on. I will tell you that it has gotten
    tremendously better also because of the capability we have for
    man in the loop testing on the sensors and on the device
    itself. It has gotten tremendously better because of the
    training we have given to people who operate the system and I
    was very pleased to hear that he feels like that same
    discipline and training is being translated into Fort Greeley.
        This allows me to tell you that the way that we are doing
    the component and subsystem tests and putting men in the loop
    and emulating, which is different than simulation, which means
    you take the actual signal as it would have come from a certain
    part of the system into the other one, I would tell you that we
    are far better in our capability of emulating an actual
    intercept than we were in 1991 when the first of the Patriot
    missiles was designed.
        Senator Ben Nelson. We have had more opportunity to test
    the Patriot missile system in the most realistic setting
    possible, in war. Field testing or realistic testing is not the
    same for a missile defense system because we hope not to have
    to test it under similar conditions.
        So Mr. Christie, do you think that we are going to be able
    to get the kind of result that we would be able to say it is
    good or it is good enough? Perhaps the most important question
    is, how do we know? The testing is not necessarily as realistic
    as it is in actual combat.
        Mr. Christie. Well, as time goes on, I think the realism of
    the testing that we will be doing with this system,
    particularly after we have all the components of the test bed
    in place, to include the ship-based X-Band radar, we will
    certainly have far more confidence in our estimates of our
    capability than we have today.
        In fact, back to the issue of the number of missiles that
    we will manufacture in this R&D program, I would hope and think
    that as we look to the future, we have tests planned in the
    next couple of years where we will be firing some of these very
    expensive missiles in salvos. We will increase the complexity
    of the tests with multitargets and multimissiles, so the more
    missiles we have available for testing, the better I think we
    will be in having confidence.
        Senator Ben Nelson. I would agree with you. That is why I
    was a little concerned by General Kadish's comment that we are
    both building to test and also building some to stockpile.
    Because I am concerned with ammunition, as a hunter, that is a
    dud. I would hate to think we are stockpiling in any sense
    whatsoever before we know that we have reached some level of
    acceptance in terms of the successful capability, because
    otherwise I think we are spending a lot of money stockpiling
    when we still should be testing until we are satisfied.
        I guess maybe that is not a question, it is a statement. In
    any event, I appreciate what you are doing. I think oversight
    sometimes requires some heavy questions, but you are doing some
    heavy duty testing and heavy duty defense work for the country,
    so you are used to heavy duty activity. So thank you very much.
    I appreciate it. Keep up the good work.
        Senator Allard. Senator Dayton.
        Senator Dayton. Thank you, Mr. Chairman. Gentlemen, this is
    the fourth time I have been involved in this process as a
    member of this committee. In each of those instances my
    experience has been unanimous support among its members for the
    R&D, testing, and deployment of this system. The law says you
    should deploy when possible, but I would say when proper.
        What you are getting today are questions, and I have these
    questions as well, about whether the deployment timetable is
    being dictated by professional judgments or political
    pronouncements. I realize you are constrained by the orders you
    have been given by your civilian commanders.
        This comment is not directed toward you. Personally and
    philosophically, I have a hard time with people who run for
    public office stating that government does everything badly and
    then when they are elected they go out to prove themselves
    correct.
        I cannot conceive of business executives who are
    responsible, corporate leaders who would go to their board of
    directors or to their shareholders and say, we have this major
    new product we are going to bring out, and it is breakthrough
    technology, unproven, untried, but we are already building the
    first sites. We are starting production based on this degree of
    testing.
        Last week, we debated standards of liability and negligence
    for producing handguns and rifles. If those products--and it is
    not an exact comparison, because they are in the general
    public--but if those products were deployed with this degree of
    testing, they would be liable for negligence, gross negligence,
    anything you would want to find. It would be unthinkable by
    corporate prudence, by fiscal sanity, by government oversight,
    and by public common sense to be undertaking this, in my
    judgment, based on what I know and based on what you are
    telling me here.
        I mean, some of these comments are just unbelievable. We
    are using scenarios to incorporate increasing realism into our
    test program. I would think realism would be a starting point,
    not the ending point of test programs. Again, certainly before
    you start talking about building sites and authorizing the
    production, paying for the production of missiles and putting
    those out and deploying them and then stating that they
    represent a useful BMD capability, a dramatic improvement over
    our current condition of being defenseless against ballistic
    missile attack.
        This is a rudimentary system, as one of you said, in a
    situation which requires incredible, as others of you have
    pointed out, sophistication and perfection. Another comment
    made was that there is now being incorporated a certain rigor
    in the testing philosophy. We are now using more complex target
    presentations and engagement geometries.
        I assume that means things like testing not just on sunny
    days and not just with single missiles whose trajectory is
    already known, at the time already known and without confusing
    and distracting other measures.
        Again, if that is where we are at in the development of
    this technologically, so be it. I do not question that all is
    being done that can be done, but I certainly question the
    wisdom of this deployment and construction. As a public works
    project in Alaska, I guess it is worth something as a jobs
    program. It is limited, but it is certainly vastly more
    effective than moving the estate tax repeal from the year 2010
    to 2009.
        I would personally feel a lot better about it if the
    administration would agree to a highway construction bill that
    would at least benefit the other 49 States, including my own.
    Those are established technologies. We are along for the ride
    on this. Two years ago, there was even the thought mentioned of
    shaving a slice, a sliver of the funding based on funds that
    had been determined to be not used in the previous fiscal year
    and would be available for the next fiscal year. The
    administration responded with veto threats and suggested or
    posed that we would be emasculating the entire national defense
    of the Nation--gutting is the operative word these days,
    gutting our capability.
        I do not even imagine those considerations in my darkest
    moments at night. We are along for the ride on these decisions
    and so is the American public and the taxpayer. Whether it is
    the most efficient use of tax dollars, I just seriously doubt
    whether these expenditures are even putting us on the most
    expeditious path of what we want and need.
        We have agreed here. We need a system that can perform
    incredibly complex functions over distances at speeds within
    seconds, and with the precision necessary to accomplish the
    results under all weather conditions despite enemy subterfuge
    and disruptive tactics and do it perfectly every time. We have
    to rely, it seems to me, on your making the right decisions for
    the right reasons to produce the right results.
        I hope and I pray that you are. I hope that we and everyone
    else involved in the political realm can permit and not prevent
    you from doing so. My time has expired. Thank you.
        Senator Allard. Senator Clinton.
        Senator Clinton. Thank you very much. The General
    Accounting Office (GAO) is publicly releasing a report today
    that expresses concern about the lack of test data, something
    we have been focusing on here. The report warns that the test
    plans through 2007 do not include sufficiently challenging
    targets and decoys. Now, the report, General Kadish, says that
    the first attempt at launching two interceptors against two
    targets is not scheduled until 2007. Is that correct?
        General Kadish. That is incorrect. I have not read the
    report specifically, but part of the problem we have here is
    that we have continually evaluated our test programs and
    changed our plans significantly sometimes based on the
    performance of the system. So we are not able to keep it up
    realtime given how those reports are made. So I am sure at one
    time that was what the schedule was, but I believe we have
    accelerated that effort.
        Senator Clinton. So sometime after deployment in 2004 but
    before 2007?
        General Kadish. I will have to make sure it is right for
    the record. I think it is next year.
        [The information referred to follows:]

        Our current estimate to flight test two interceptors against two
    targets is the fiscal year 2008 time frame.

        Senator Clinton. The report also says that no plans exist
    to assess the effects of severe weather on the system's
    performance or to conduct flight tests under unrehearsed and
    unscripted conditions.
        I assume that relates to Senator Reed's point about the
    GPS. But with respect to weather and the unscripted conditions,
    is that a fair statement?
        General Kadish. I do not think it is fair in the sense that
    we do not currently wait for a storm to do our test. We have
    time lines to meet. We have certainly had weather effects on
    our system, rain storms occurring during the tests, that type
    of thing.
        Senator Allard. Senator Clinton, if I might caution you,
    this report from the GAO that you are referring to ended up
    being a classified document. I know it came into the committee
    as an unclassified document, but then the committee reclaimed
    it as a classified document. So I think we have to be a little
    careful about it. I just want to warn you about that.
        Senator Clinton. I appreciate that caution. It is my
    understanding that is a different document. The GAO report I am
    referring to is going to be publicly released today. I believe
    there is a confusion about the reports.
        Senator Allard. Okay, as long as you understand and are
    aware of that.
        Senator Clinton. I am very much aware of that, Senator. In
    fact, I am reading from The Washington Post.
        Senator Allard. Well, there was an article written about
    the classified document that I understand should not have been
    made public.
        Senator Clinton. I know, but that is a different issue.
        Senator Allard. That is a different issue.
        Senator Clinton. Yes, sir.
        Senator Allard. Okay, very good. Just as long as we are
    aware of that.
        Senator Clinton. I assume this does not come out of my
    time.
        Senator Allard. It does not.
        Senator Levin. Mr. Chairman, I would also ask for 30
    seconds not out of Senator Clinton's time to put in the record
    GAO highlights of the report that Senator Clinton is referring
    to, because there are indeed two reports. The one that she is
    referring to is not the classified report. But I'd put in the
    record the one page that we have which is clearly unclassified
    that I know she is----
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Allard. Without objection. Thank you. Senator
    Clinton, you may proceed.
        Senator Clinton. Thank you, Mr. Chairman. Thank you,
    Senator. The other point raised in the unclassified GAO report
    refers to the reliance on tracking data from an old
    surveillance radar called Cobra Dane, but the report notes that
    the radar will not have been tested in its new role and will
    lack the ability even with software improvements being
    contemplated to provide more than a rudimentary analysis of
    incoming missile threats. Is that a correct statement?
        General Kadish. I do not believe it is going to be correct.
    It may be correct today. The radar in Cobra Dane, again, I
    would rather not get into the specifics here for classification
    reasons, but as of today, we have installed our software on
    that radar and it is actually tracking objects.
        Senator Clinton. General, last year at our hearing, my
    colleague, Senator Bayh, asked a question and he unfortunately
    had to leave, but I want to reiterate the question because I
    think it really gets to the core of our concerns. Last year,
    Senator Bayh said suppose that our best efforts at negotiation
    and containment of North Korea prove unsuccessful. That at some
    point next year, the President, whoever that is, is confronted
    with actionable intelligence that for whatever irrational
    reason, the North Koreans are contemplating or preparing to
    launch missiles against our territory, and most likely that
    would mean Hawaii or perhaps Alaska.
        The President calls you, General Kadish, and says, tell me,
    am I ready to defend against a potential attack from North
    Korea today? Last year, the response, as I recall, to Senator
    Bayh was that is classified. Is that the same response this
    year?
        General Kadish. The actual performance data would be
    classified, yes.
        Senator Clinton. What that leaves, though, is a tremendous
    amount of concern on the part not just of Members of Congress
    who like myself support a national missile defense system if it
    is done appropriately, and if it actually works, but it also
    raises the possibility that whether it works or not at this
    point, it has deterrent effect. The very fact that we are
    engaged in it may in some way deter those assuming they act
    rationally.
        Do you have any prediction as to when performance data will
    be made publicly available so that it can be debated and
    analyzed by Members of this body and, equally importantly, the
    American public? I am not talking about detailed information,
    but at least being able to answer the question, will it work if
    we are confronted with a launch from North Korea? Is this a
    defense system that we can count on to work?
        General Kadish. I think there are two questions there, so
    let me try to answer the two questions unless somebody else
    wants to help me answer this question. From my
    responsibilities, I firmly believe that the performance
    characteristics of any weapons system, especially this missile
    defense system, should be properly protected with
    classifications appropriate to it.
        So public discussions of specific performance capabilities
    would not be appropriate. I do not think we generally like to
    discuss in public our offensive performance capabilities for
    the same reasons.
        Having said that, however, the next question is, how are we
    going to maintain increasing confidence in the effort, and what
    characterization could you make at any given time in the
    system? I guess my response to that would be that at any given
    time, we will have an understanding of the behavior of our
    systems. It is performance based on testing to date, and it
    will change over time.
        It is my belief, given the investments that we have going
    here, it will always get better. Now, at any point in time,
    Admiral Ellis and our successors in these positions will have
    to make that judgment. If we are ever asked the question, what
    is the capability we have today, we will have to describe that
    in ways that people can understand and act on.
        But it is a different equation when you say there is no
    capability today, zero, and there is something different than
    zero, and there is a different assessment between when you have
    something that is constantly improving to describe that in a
    way that people can understand. I think we will be in a
    position to do that when and if called upon to do it.
        In fact, as we put it on alert, that is part of the process
    of learning about the system.
        Mr. Wynne. Senator, I would also like to follow up and just
    say that after each test, I know that the MDA comes and
    discusses with this committee the results of those tests.
        I expect that that interaction will continue to make sure
    that you do in fact have a very robust knowledge of what the
    capabilities are. I know that beyond that, this committee has
    been and continues to be extremely sensitive to making sure
    that we do in fact express a deterrent effect. I go back to the
    Strategic Air Command and their nuclear mission.
        Peace was their profession and that was their motto, and I
    know it is the motto of the Atlas missile. People who sit right
    now under the watchful eyes of Admiral Ellis, and I know it is
    going to be essentially the mission of the ground-based missile
    defense that we hope we have invested in sufficiently and are
    technologically clear that it will have the deterrent effect
    our triad has had over the years.
        Senator Clinton. Mr. Wynne, do you believe that the recent
    Russian claim about their development of a capacity to--I do
    not know if it is fair to say evade--their recent announcement
    that they developed a maneuvering warhead to evade missile
    defense?
        Mr. Wynne. I read that in a public policy--I have not seen
    anything beyond that. There is no doubt that the Russians are
    continuing to invest in offensive missile capability, and that
    we do not know yet what the level of development is.
        Senator Clinton. General, do you have an opinion about the
    Russian claim?
        General Kadish. I think the same as Mr. Wynne. At this
    point in time, our missile defense systems are not oriented to
    Russia. So I am not paying much attention to that.
        Senator Allard. Senator Clinton, we need to move forward. I
    gave you an extra 2 minutes, by the way.
        Senator Clinton. Thank you, Mr. Chairman.
        Senator Allard. You bet. Senator Pryor.
        Senator Pryor. Thank you, Mr. Chairman. Secretary Wynne, as
    the Pentagon's acquisition executive, you oversee both the Army
    missile defense programs and those of the MDA. I have a
    question regarding budget priorities.
        In your budget request for fiscal year 2005, you have
    requested a very large amount of funding for missile defense,
    about $10.2 billion. It is more than a billion dollars over
    last year. Yet, despite the increase in overall missile defense
    funding, funding for the PAC-3, as I understand the only
    operational system we currently have, would drop by almost $350
    million from last year's level.
        So even though there is an increase overall, there is a
    decrease in that one operational system. In fact, in response
    to Senator Nelson's question, you talked about how it had
    gotten ``tremendously better,'' the PAC-3.
        So with such an increase in missile defense, why would you
    want to reduce the funding for the only operational missile
    system that we have?
        Mr. Wynne. The priorities that are made are actually
    designed by the Secretary. I think he will tell you that the
    PAC-3 missile defense system is also now known as MEADS. It is
    incorporating, I think, new developments for a 360 degree look
    radar, some thing that we need to essentially slow down to make
    sure that we do take into account all the lessons learned in
    OIF.
        I think the allocation is proper. I think the imminence of
    the threat has been balanced, and I will say that the Army is
    satisfied with the amount of funding that they have right now
    for PAC-3. I would not say that any program manager worth his
    salt would be totally satisfied, but I would have to ask
    Lieutenant General Dodgen to second the motion.
        General Dodgen. Senator, thank you for the question. The
    RDT&E reductions in PAC-3 and Patriot can be explained by the
    sheer maturity of the program and the fact that we are moving
    into more procurement, from a standpoint of percentages of the
    program.
        So we have had a downturn in the Patriot and PAC-3, but
    MEADS is still flatlined, because we are still doing
    development of that program.
        In addition, we are coming to the end of our procurement of
    the CONFIG 3 radars, of which we did six last year and we are
    only doing one this year. We are procuring 108 PAC-3 missiles,
    which is less than we did last year because of a congressional
    plus-up that was added last year. But the 108 that the Army had
    planned for is on the track.
        So we are very comfortable with the levels. But as you
    said, you can always apply more funding if it is offered.
        Senator Pryor. Well, thank you for those responses. I am
    glad that you all have gotten me inside the numbers here.
    Because when you just look at the raw numbers, that question
    popped out at me.
        Secretary Wynne, the Pentagon's budget request for the
    Missile Defense Program is $1.2 billion more than last year,
    but when you look at the 5 year budget protections for the
    Block 2004 and Block 2006 ground-based national missile defense
    program, it has gone up by almost $6 billion since last year
    with most of the cost in fiscal year 2006 and 2007.
        The total cost of the program looks like it has doubled in
    a single year. In any other program that the DOD would have
    under the normal acquisition rules, like the F-22 for example,
    such rapid cost growth might trigger a congressionally-mandated
    review to determine what is going on in the program and why the
    numbers are increasing so rapidly.
        So let me ask you, what is going on in the program and have
    you or have you not undertaken any sort of review? Also lastly,
    what confidence level do you have that such cost growth will
    not continue in the program?
        Mr. Wynne. There are a lot of questions in there, sir. I
    will take my time in trying to answer them all. Number one is
    we do a review with General Kadish for myself once a week. He
    has been quite challenged, frankly, in the performance because
    there has been an increasing, I think, surety of schedule
    achievement. The test programs that we want him to perform are
    becoming a little bit more robust than we had decided.
        Frankly, he has had a little overrun and he has managed the
    ABL system fairly well. He has taken it upon himself to
    initiate the cancellation of the RAMOS program that you have
    heard about and to fund some things from internal funds so he
    is applying financial management.
        The requirements that we have laid on him in the 2006
    domain have frankly continued to increase as we have looked to,
    if the system is effective, then what place holders should we
    put out there to make sure that we do not, if you will, do not
    have the capacity to expand.
        On the other hand, I will tell you that next year is going
    to be another year and General Kadish and his successor are
    going to have to defend their budget against all the priorities
    that come up. They put place holders in to try to make sure
    that they in fact have a reservation, if you will. The same
    thing is going to happen with 2007.
        I commented on the fragility of this program development,
    as well as my confidence in achievement, and I think that is
    where the place holding should be. General Kadish, do you have
    anything further on that?
        General Kadish. I would just like to re-emphasize the fact
    that the RDT&E budget remains relatively stable but most of the
    increases you are seeing within the context of Mr. Wynne's
    comments are for follow-on place holders for new capability. So
    it might look like an increase to the overall execution of the
    program, but it is more oriented to that effort.
        Senator Allard. Thank you, Senator Pryor.
        Senator Pryor. Thank you, Mr. Chairman.
        Senator Allard. My plans are for us to go ahead and start
    another line of questioning. I will start those off.
        So first of all, this has to do with the PAC-3. General
    Dodgen, could you estimate maybe in general terms how many
    lives the PAC-3 and PAC-2 GEM saved during OIF?
        General Dodgen. Given the limited accuracy of the missiles
    that were coming in, it is hard to put a precise number to it,
    but we know that several of these were targeted at base camps
    where there were significant number of soldiers. We are not
    disputing the CNN program that said that one of them was on top
    of the command post. So I think there is significant savings of
    lives with the engagements that did happen, but it is very
    difficult to put a number to it.
        Senator Allard. We have heard that something went wrong in
    every PAC-3 operational test. Should we have developed a PAC-3
    for OIF or did the system have value in spite of the testing
    shortfalls?
        General Dodgen. Well, I think deploying the PAC-3 missile
    to OIF was a correct decision, and to employ it as a system. It
    is going to counter tremendous threats that we did not see in
    OIF, but certainly could have been there in OIF. That increased
    capability, the extra speed, the hit to kill certainly affords
    extra protection to our soldiers.
        Senator Allard. Now, for General Kadish and then Secretary
    Wynne, I know we do not use the Israeli requisition process,
    but I would note that Israel declared its Arrow BMDS to
    operational status quite early in its testing, and that they
    have continued to improve the Arrow over time. How well has
    that approach worked for them?
        Mr. Wynne. I can take that a little bit, sir. I would tell
    you that, first of all, the Israeli nation is faced with
    continuing threats. They have a marvelous system for rapid
    deployment. They have a smaller force for the rapid deployment.
    I think their contribution in the Arrow system is quite
    significant.
        It is telling, however, that they felt they needed it and
    they, of course, needed it in support of OIF that we were just
    in. Then when they had a system capability, they brought it
    online and they hoped they would never have to use it, and I
    think that is what occurred. General?
        General Kadish. I would agree with that since we worked so
    closely on the Arrow program with the Israelis. I would just
    make the comment that we have more tests than they did when
    they put it on alert as of this date.
        Senator Allard. I'd like to move on, General Kadish, to
    your national team concept, and it has come under a little bit
    of criticism here. Would you describe in more detail the roles
    that the national team plays in your effort to develop the
    BMDS? Also, how would you quantify the effects of a funding
    reduction to the program elements that relate to the national
    team?
        General Kadish. The national team is a collection of
    personnel from all industry partners that we could sign up, as
    well as government. Their job is to do the systems engineering
    so critical to make these very complex systems work, and cross
    the boundaries of the Army, Navy, and Air Force systems that we
    are using to do the detailed engineering.
        If we did not have that entity, I could not at all be
    confident that we could fulfill our promise in delivering an
    integrated BMDS. That is how critical it is.
        Mr. Wynne. If I could add to General Kadish's comment, over
    the years, every time that we wanted to reduce a program, we
    always seem to go after the systems engineers and then we paid
    for it later. I have really taken a specific interest in making
    sure that we reassert the level of systems engineering
    competence across the Department.
        I think the method that General Kadish has used has really
    contributed in an extraordinarily beneficial way to achieving
    in 5 years from the 1999----
        Senator Allard. So you would assess the national team
    performance as exceptional?
        Mr. Wynne. I would assess the national team performance as
    essential to what he is trying to do. Yes, sir.
        General Kadish. I will just re-emphasize that. Whenever we
    get resources marked against it, we have to reduce people. That
    increases our difficulty of getting the job done.
        Senator Allard. Senator Levin?
        Senator Levin. Thank you, Mr. Chairman. Mr. Christie, is
    this system still in developmental testing in your judgment?
        Mr. Christie. Yes, sir.
        Senator Levin. When will it move over to your office to
    operational testing?
        Mr. Christie. As of right now there are no plans for that.
    We are heavily involved with the office in most of the flight
    tests that will take place over the next couple of years. We
    will have operational flavor. The operation of the sites at
    Fort Greeley and Vandenberg will have operational troops, and
    we will be gathering a lot of operational data from those
    deployments.
        But as far as dedicated operational testing that I am in
    control of right now, that's not in the plan for the
    foreseeable future. I can not answer that.
        Senator Levin. Ever?
        Mr. Christie. It depends on, as the system matures, and if
    we eventually turn some of these systems totally over to the
    operators and we can go into what we call real production, then
    I would think, yes, Title X will kick in then, and we will have
    operational testing.
        Senator Levin. What is the purpose of your office?
        Mr. Christie. The purpose of my office is to oversee the
    operational testing that takes place in the Services for the
    most part, and to provide our independent evaluation of that
    testing to the decisionmakers who are in the building and in
    Congress. One of the items that we are statutorily required to
    provide is a report to these decisionmakers and to Congress
    before a system goes beyond low-rate initial production and to
    do our assessment of the operational effectiveness and
    suitability of the system under test.
        Senator Levin. The underlying purpose of all of that is to
    make sure that we have maximum capability in a system, is that
    not true?
        Mr. Christie. That we are not delivering something to the
    troops that is ineffective or unsuitable and we are allowing
    them to know what they are getting in their hands. That is
    right.
        Senator Levin. That is the reason we want maximum
    confidence in that capability?
        Mr. Christie. Of course.
        Senator Levin. That is the purpose of your office.
        Mr. Christie. That is right.
        Senator Levin. That is why your office takes over
    developmental testing at some point on weapons systems?
        Mr. Christie. That is right.
        Senator Levin. You have no idea when that is going to----
        Mr. Christie. At this point in time, I do not see it in the
    plan.
        Senator Levin. At all. General Kadish, is it your
    understanding that this is going to be turned over from
    developmental testing to operational testing at some point in
    the future?
        General Kadish. I think that has always been our vision on
    this, but the difficulty that Mr. Christie and I are struggling
    with is when should that happen given the nature of this
    particular weapons system. It is different from almost anything
    I have been associated with.
        Senator Levin. Mr. Christie, at the time of your most
    recent report to Congress in January, two intercept tests were
    scheduled prior to the September deployment of the system. At
    that time, you said, ``even with successful intercepts in both
    of these attempts, the small number of tests would limit
    confidence in the integrated interceptor performance.'' Do you
    stand by that statement of 2 months ago?
        Mr. Christie. Yes, sir.
        Senator Levin. Now, we are going to see deployment after
    one intercept test. So would you say that would limit your
    confidence even further?
        Mr. Christie. It depends on how we conducted that test, and
    what other tests we will be conducting with the operators on
    hand. Certainly I would like two tests. I would like four tests
    between now and then, and with one versus two, obviously we
    will have less confidence in our assessment.
        Senator Levin. Even less confidence that you had a month
    ago?
        Mr. Christie. That is right.
        Senator Levin. In the budget request, there is a lot of
    money here for the apparently long lead activity as it is put
    for ground-based interceptors at a third site, is that correct,
    General?
        General Kadish. I do not believe that to be true. Not in
    the 2005 budget. If you are referring to the rest of what is
    noted in the budget, that is true. We do not start looking at
    that third site until fiscal year 2006.
        Senator Levin. Let me read you your budget. It says we have
    added funding for the next increment of BMD capability. The
    fiscal year 2005 funding for these efforts is approximately
    $677 million, and approximately $2.6 billion from fiscal year
    2005 to 2007. This includes funding for additional ground-based
    interceptors at Fort Greeley, the upgrade of the Thule early
    warning radar, and long-lead activity for ground-based
    interceptors at a potential third site.
        General Kadish. I am not sure that's accurate. I'd have to
    add, sir, for the record. But to the best of my knowledge is
    that we are asking for the funding for the fiscal year 2005 and
    2006, the next 10 if you will. If there is some long lead
    funding in there for the follow on 10, I am just not aware of
    it. I will just have to go back and check.
        [The information referred to follows:]

        MDA has requested funding from fiscal year 2005-2007 for the
    additional 10 interceptors at Fort Greeley. Also, MDA requested long
    lead funding for another 10 interceptors for a potential third site.
    The fiscal year 2005 increment also includes the initial funds for Fort
    Greeley missile field expansion, forward deployable radar, and Thule
    UEWR.

        Senator Levin. For the follow on 10, I want to be real
    clear as to what we are talking about. We have already funded
    20, and you are asking for 10 in this budget, so that is 30.
    Those are going to go to two sites, correct?
        General Kadish. The current planning is that that 10 go to
    Fort Greeley.
        Senator Levin. All right. The ten in this year's budget.
    Now, there is long lead for additional, according to your
    budget. You are not sure that is accurate?
        General Kadish. I am not sure. I would just have to go back
    and check.
        [The information referred to follows:]

        Included in the fiscal year 2005 request is $35 million for long
    lead materials for 10 interceptors for a potential third site.

        Senator Levin. If there is, that would be for a third site?
        General Kadish. Yes.
        Senator Levin. Where is that third site?
        General Kadish. That's the reason why it's not postulated
    fully in 2005. We still have to determine where that third
    site's going to be.
        Senator Levin. Is that part of a test bed?
        General Kadish. It will be a larger part of our testing
    activity. We have not characterized the third site sufficiently
    yet. That is why the budget is the way it is. We need more time
    to do that.
        Senator Levin. It may or may not be part of a third site,
    is that correct? It may or may not be part of the test bed, is
    that what you are saying?
        General Kadish. It may or may not be, yes.
        Mr. Wynne. Senator, I would tell you that once we start a
    warm line we want to keep that warm line because of the
    destruction in industry. The provision of long lead funding, I
    think where those missiles might go was a speculation in the
    document. The fact of the long lead I do not think is an issue.
        Senator Levin. Well, the issue is whether or not those are
    going to be part of a test bed or not. The answer is you do not
    know if they are.
        Mr. Wynne. We do not know if they are.
        Senator Levin. How many of the 30 that are going to be
    funded if this budget is adopted are going to be launched for
    flight testing? General?
        General Kadish. I think we have postulated three to four
    flight tests a year. That is what had been our planning factor
    for the out years. The source of those missiles I am not too
    sure of in terms of five, six, seven, eight--I mean, six,
    seven, eight, nine time frame----
        Senator Levin. What would you estimate would be the maximum
    number of those 30 that you would be planning on using for
    launch--for flight testing?
        General Kadish. Here is the way we postulate it would work.
    The missiles that we put in first in the test bed will be the
    first out to test and actually fly. We will replace those and
    those new ones would become part of the test bed, and----
        Senator Levin. How many of the Fort Greeley ones would be
    launched?
        General Kadish. Eventually all of them.
        Senator Levin. They would be moved somewhere else?
        General Kadish. No. Well, they may--this is part of the
    ongoing planning. That is why we all get frustrated from time
    to time when we change our plans. But we are flying out of
    Vandenberg and although we have not completed the environmental
    statements for the final decision, our intention is to fly out
    of Greeley.
        Senator Levin. Out of Greeley. That is a change?
        General Kadish. I have been saying that for a few years
    now.
        Senator Levin. It would be a change if that is approved.
        General Kadish. It would be a change.
        Senator Levin. My last question. If we approve these 10 on
    top of the 20 previously approved, how many of those 30 do you
    believe would be actually launched as part of flight testing?
    Could it be as many as 15?
        General Kadish. Can I take that for the record, Senator? I
    want to be precise on that and I just do not have the
    recollection for those quantities that far out. Those could be
    tested over the next 5 years or more, or longer. So I just do
    not know.
        [The information referred to follows:]

        We currently have 15 flight tests on our schedule that will utilize
    interceptors.

        Senator Levin. So you do not know what part of the 30 would
    be launched as part of either developmental or operational
    testing, is that correct?
        General Kadish. Yes.
        Senator Levin. Is it fair to say it will be less than 30?
        Mr. Wynne. Senator, I think if the General might think
    about it, all of those missiles will ultimately launched in
    tests. The question is when. I think your question goes to how
    many and when.
        Senator Levin. No, my question is not when, my question is
    whether.
        Mr. Wynne. Well, I can tell you that the first several
    tranches of Atlas missiles have all been launched----
        Senator Levin. In other words, it is possible that all 30
    of those are going to be used for developmental or operational
    testing, is that your answer?
        General Kadish. That is my belief. It is a matter of the
    timing. If you look at the way our ICBMs go, we launch those
    regularly. We use up the inventory. I do not think it would be
    wise in missile defense not to do the same thing.
        Senator Levin. If there is any change in that answer for
    the record, let us know. Thank you, Mr. Chairman.
        [The information referred to follows:]

        No change.

        Senator Allard. Senator Akaka.
        Senator Akaka. Thank you very much, Mr. Chairman. General
    Kadish, I have some questions because of the GAO report. The
    GAO has been looking into the ABL program. They recently
    provided a review of the preliminary findings and some of the
    findings are truly, truly astounding.
        GAO calls into question whether or not it makes sense for
    Congress to continue funding this program at the requested
    level, especially in this era of tight budgets. In regard to
    the program's costs, GAO concludes, ``the prime contracts costs
    has increased by about $1 billion since 1996. In fiscal year
    2003, the cost overrun was $242 million, and that the prime
    contract could overrun budgeted costs at completion by $431
    million to $943 million.''
        So we are looking at $2 billion in cost overruns before we
    get to the first operational test of the system. My question to
    you, General, is what is MDA's estimate of how much this ABL
    program is going to cost by completion?
        General Kadish. Well, the definition of completion is a
    little bit problematical, given the revolutionary nature of
    this effort. But I can tell you what is in the budget. We have
    about $2 billion in the budget to continue development over the
    next 5 years. In fact, I think it is higher than that. I think
    it is closer to three.
        The nature of the cost turbulence that you pointed out is
    reflecting the very complex development effort of putting a
    laser on an airplane like the 747 and making it work. We have a
    technical challenge, and we have been doing very well against
    that technical challenge, but it has been costing us more money
    and taking longer to do.
        If I could just use for illustration why we are dealing
    with this right now, I will use this laser here. If you could
    look at that wall over there, and I am trying to hold that
    thing pretty steady, but it is still bouncing around, and we
    want to do that over 200 miles basically. We are close to doing
    it. We believe we are close to doing it. It is revolutionary in
    its impact but it is probably one of the most complicated
    airplane weapons systems integrations that this country has
    ever done.
        So it is costing more, but we believe the investment is
    worth it at this time.
        Senator Akaka. General Kadish, when the ABL was first
    proposed, it seems to me people were very optimistic, maybe
    even overly optimistic about the engineering problems and
    greatly underestimated the technology and integration problems.
    People have to be coaxed, I understand, out of retirement to
    work on the optical problems. A lot of engineering involved has
    been described now as a lost art.
        I understand that the volume of testing required for
    hundreds of first of their kind components was never
    anticipated. The GAO believes that the Air Force put this into
    an acquisition program before it was ready.
        Originally, MDA said it would demonstrate the laser's
    lethal effectiveness by testing its ability to shoot down a
    missile in fiscal year 2005, but now, in your 2005 budget
    request, MDA says only by the ``earliest possible date.''
        You have a technology that we do not know whether it will
    work, or at least you cannot provide a date when it will or how
    many billions of dollars more it will cost. So my question to
    you is, why is this still an acquisition program? Why is it not
    a S&T demonstration type of program?
        General Kadish. Well, I think the ABL program as it is
    being managed today is typical of the way we are doing
    everything in the missile defense effort. A capabilities-based
    evolutionary approach.
        That means we are not in a classic acquisition, where we
    are dealing with a mature technology, where something already
    exists like an airplane and we are trying to make it better. We
    are dealing in an area of technology that nobody in the world
    has ever done before. It requires new management techniques and
    new understanding of the risks involved.
        I think that the dollars we have allocated to this are
    visible and understandable. The technical progress we have made
    has been substantial, but we are not there yet. I think that we
    do not have a production program behind us like a normal
    acquisition program. We do not have a lot of the other
    activities that we will be spending money on.
        In fact, because of our delay I restructured the program
    last December, such that we decided not to buy another aircraft
    and start that integration effort until we made more progress
    on the first one.
        So I believe that the management actions we have taken and
    the technology we are dealing with is worth the effort to
    proceed and the dollars required to do that.
        Senator Akaka. General Kadish, I understand from the GAO
    again that the current ABL contract is supposed to reach its
    cost ceiling by May 2004. The MDA cannot build a business case
    for this program, I believe, at this time. An example is in
    fiscal year 2004, where you requested $345 million and in
    fiscal year 2005, $150 million. But your fiscal year 2005
    budget request is showing $603 million in fiscal year 2004, and
    $474 million in fiscal year 2005.
        My question to you is, how are you justifying this for
    funding for a program from year to year. It does not seem to
    have any idea how much it will be expending.
        General Kadish. Senator, that is an accounting activity. I
    think the GAO focused on only one airplane. In the budget, we
    have projected to start buying that second airplane. As I just
    mentioned to you, we restructured the program and decided to
    defer that second airplane, and we applied the funds to the
    first airplane.
        It is not correct to say that we do not understand how much
    it costs us to do the work in any given year. We certainly know
    that with great precision. The problem we are having is that it
    is taking longer for us to do the work. So we have added to the
    budget to make sure that we adequately fund that effort. But we
    have diverted the funds from the second aircraft to the
    fundamental effort.
        Senator Akaka. Mr. Chairman, I have just one more question
    for Mr. Christie. It has been reported that several critical
    elements of the ground-based midcourse defense system, which is
    scheduled to be operational by October 2004, will not be ready
    on time because of technological challenges.
        The MDA has stated that the system will still be deployed
    as planned, and that replacements will be used in place of
    these missing components. Of course, I am concerned that we
    will be deploying an incomplete system that will not protect
    the American people as we hope.
        Can you please discuss that decision to initiate a ground-
    based midcourse defense system that is not fully tested and
    explain what risks we are incurring as a result of this
    decision?
        Mr. Christie. I am not sure what elements of the originally
    planned test bed will not be online, so I am not sure what you
    are talking about, that we are foregoing some of the elements
    such as the missiles in the silos, the upgrade to Cobra Dane,
    the early warning radar at Vandenberg, and missiles in the
    silos at Vandenberg.
        As we discussed earlier, some of the integrated flight
    tests that have been scheduled for this year have now been
    slipped, and we have discussed the reasons for that. So there
    will be less flight tests to support an assessment that is done
    sometime--the continuous assessment that will be done during
    the year concerning what will be the capability that is there
    when we have an initial deployment.
        So I am not sure what elements are not going to be there
    that we had planned to have there. Are you familiar with that,
    General Kadish?
        General Kadish. Senator, we are going to have all the
    elements we need based on our schedules today unless something
    happens between now and then. So we are on track to do that.
    The hardware will be there. The software appears to be ready to
    go and then we are going to decide whether or not we are going
    to have it in an alert posture. The hardware will be there on
    our internal schedules. As Mr. Wynne said, there is no date
    certain for us to do that, but we do have our internal target.
        Senator Akaka. I thank you very much for your responses.
    Thank you, Mr. Chairman.
        Senator Allard. Thank you. I want to wrap this up with just
    one final question here. We had the discussion on the number of
    missiles that you require.
        Secretary Wynne, I would like to have you and Mr. Kadish
    answer this question. How many of the missiles you are
    requiring will be used in cycle and other lifecycle testing?
        Mr. Wynne. I can tell you, Senator, that the way this
    program is evolving, every one of the new missiles will be
    better than the one that was previously produced. The testing
    is continuous. The workers are learning. The industrial workers
    are learning. Each one of the missiles will add to the
    reliability of the system.
        In addition to that, as General Kadish said, I think we
    will have the capability to do an actual operational concept
    which actually will use two missiles instead of one missile
    during the test. If we do that on a realistic basis, and
    depending on whether Mr. Christie or his successor demands that
    we do an actual operational, I think that is only 15 tests. So
    every one of them will add to the reliability.
        Senator Allard. General Kadish, any further comment on
    that?
        General Kadish. I would agree wholeheartedly.
        Senator Allard. Gentlemen, I want to thank all of you for
    your service to this country. We have spent a lot of time in
    front of this committee. We appreciate you sharing your
    thoughts with us. I wish you well. Thank you very much.
        [Questions for the record with answers supplied follow:]
                  Questions Submitted by Senator Wayne Allard
                                     pac-3
        1. Senator Allard. General Dodgen, as effective as the PAC-3 is, it
    remains an expensive tactical missile--over $3 million per copy. Would
    you describe any efforts the Army has to reduce the unit cost, and how
    is the contractor incentivized to reduce unit cost? How does reducing
    the procurement quantity affect the unit cost?
        General Dodgen. The approximately $3 million amount that is often
    quoted for each PAC-3 missile includes not only the cost of the actual
    missile unit but also administrative overhead, replacement/redesign of
    obsolete parts, and reasonable contractor profit. From a production
    standpoint, unit production costs continues to decrease from the
    initial PAC-3 production costs. However, the Army and the prime
    contractor recognize that unit production costs are still too high for
    the missile. Accordingly, the Government recently contracted for the
    fiscal year 2004 production of the PAC-3 ``Cost Reduction Initiative''
    (CRI) missile. The CRIs will improve manufacturing of the missile by
    reducing touch labor and using components currently being used in other
    Department of Defense (DOD) programs as opposed to PAC-3 unique
    designs. In addition to reducing unit cost, the CRI missile adds new
    capability that will enable the missile to be integrated into the
    future Medium Extended Air Defense System (MEADS). Reducing procurement
    quantities negatively affects the unit cost as program fixed costs are
    spread over fewer deliverable missiles.

                                 airborne laser
        2. Senator Allard. General Kadish, I understand that you have
    restructured the Airborne Laser (ABL) program because of delays in
    building the laser and complications in integrating the subsystems in
    the aircraft. What metrics will you use now to measure progress in the
    program and will you, in this restructure, have insight into the
    anticipated cost to complete the test aircraft?
        General Kadish.
        a. The ABL program office will continue to use cost and technical
    metrics to measure progress and anticipated cost towards completion of
    the test aircraft, as we have since the inception of the program. The
    following metrics are all being collected in addition to standard
    earned value measurement techniques. For example, insight into cost to
    complete the program will be obtained through the use of an Integrated
    Baseline Review.
        b. The methods for measuring technical progress include inchstone
    measurements and headcount tracks, which also provide insight into
    cost. Each inchstone correlates to a key point or task in the schedule
    and the schedule provides the baseline for cost performance.
        c. We will also perform Schedule Risk Analysis, which consists of
    comparing actual schedule performance against the anticipated progress.
    This gives us a confidence level in the contractor's remaining
    schedule.
        d. Finally, tracking and forecasting of all full-time equivalent
    personnel working on the program is well correlated to expenditures
    since material costs are only a small component, thereby providing
    another insight into costs.

                           flyingdales radar facility
        3. Senator Allard. General Kadish, I understand that the U.S. and
    United Kingdom (U.K.) recently signed a formal memorandum of
    understanding and agreed to upgrade the Flyingdales radar facility. I
    also understand Japan recently agreed to provide nearly $1 billion for
    their own sea-based and ground-based missile defense in cooperation
    with the United States. We are negotiating a ballistic missile defense
    (BMD) framework with Australia and redefining our cooperative defense
    agreements with Canada. It seems to me that ballistic missile threat is
    a global problem that requires a global solution. Therefore, I applaud
    your efforts to build cooperative relationships with our allies. Can
    you expand upon your vision for international cooperation on missile
    defense and what challenges have you encountered in making this vision
    a reality?
        General Kadish. The Missile Defense Agency (MDA) sees international
    partners contributing to the Ballistic Missile Defense System (BMDS) in
    four fundamental ways. First, allies/friends can work with us in
    development efforts for new or improved elements of the system. Their
    technical contributions have helped us in the past. As an example,
    technology used in the focal plane array of the Arrow missile was used
    in their proof of principle test for Theater High Altitude Area Defense
    (THAAD). By working together on the Arrow development and its
    integration with Israel's Patriot batteries, we have learned valuable
    lessons for our own multi-tiered missile defense system. Second,
    allies/friends can help by allowing elements of the BMDS to be forward
    based on their territory. The radar at Royal Air Force Fylingdales is
    an excellent example of this form of cooperation. Third, allies/friends
    can help by developing their own capability to defend against ballistic
    missiles, thereby reducing the burden on the U.S. in some parts of the
    world. Israel and Japan have both committed to a national missile
    defense capability. That capability augments U.S. capability and
    reduces the requirement on U.S. forces in scenarios for the defense of
    both of those countries, as well as serving to protect U.S. forces that
    are deployed to each region. Finally, allies/friends lend political
    support to the U.S. missile defense program, providing both a rationale
    and support for military needs leading to further contributions to
    missile defense such as NATO's pending approval of plans to modify its
    command and control systems to incorporate missile defense
    functionality. Our challenges have been centered around allied
    recognition of both the need for and the viability of missile defense
    capabilities. Our technical successes over the past several years,
    coupled with the increased recognition of the inability to halt all
    proliferation of ballistic missile delivery systems, has increased
    allied acceptance of and support to the development of an effective
    missile defense capability.

                   transfer of u.s. technology and components
        4. Senator Allard. General Kadish, we have a very complicated
    export control system that is purposely designed to prevent the
    unintended transfer of U.S. advanced technology and components to
    potential adversaries. Yet, we have often seen instances where these
    same controls have hindered cooperation with our closest allies. To
    what extent have U.S. export controls complicated your efforts to build
    cooperative relationships on missile defense with our allies and
    coalition partners and do we need a fast track process for missile
    defense-related transfers to our allies and coalition partners?
        General Kadish. The technologies needed to make missile defenses
    effective are some of the most advanced and sensitive technologies
    found in defensive systems today. On the one hand, we want and need to
    be able to share necessary technologies with allies/friends working on
    missile defenses, but on the other hand, compromise of those
    technologies could have serious consequences to systems across a broad
    spectrum. For instance, our advanced radar technology could reduce the
    effectiveness of low observable aircraft. Therefore we must insure that
    we strike a balance between sharing necessary technology and protecting
    certain technology that is critical across the board. U.S. export
    controls have, in the past, complicated our efforts to build
    cooperative relationships on missile defense with our allies. Both the
    MEADS program with Germany and Italy and the Arrow program with Israel
    are examples of cooperative programs whose efforts were complicated by
    U.S. export control law. However, the Department is streamlining its
    internal processes to insure a thorough, yet timely review of
    technology transfers. We are working closely on the export issues for
    missile defense, and I am already seeing improvement in this process.
    With an inter-departmental focus on the release of missile defense
    technology to our allies, we expect to achieve the correct balance
    between missile defense cooperation and nonproliferation.
                                     ______

                   Questions Submitted by Senator Carl Levin
                 stratcom and northcom roles in missile defense
        5. Senator Levin. Admiral Ellis, what are the roles of Strategic
    Command (STRATCOM) and Northern Command (NORTHCOM) in missile defense,
    and how are their efforts coordinated?
        Admiral Ellis. Change Two of the 2002 Unified Command Plan (UCP)
    tasked STRATCOM to plan, integrate, and coordinate the global missile
    defense (GMD) capabilities of the Nation. STRATCOM is operationalizing
    the capabilities being developed and deployed by the MDA.
        We are leading the development of the necessary doctrine, concepts
    of operations (CONOPs), and operational plans in coordination with our
    subordinate Service component commands and the other combatant
    commanders. This effort requires that we define the broad
    interrelationships among the Global Ballistic Missile Defense (GBMD)
    mission and other mission areas, such as intelligence, surveillance,
    reconnaissance (ISR) and strike operations, and information operations.
    Operationalizing GMD capabilities also requires detailed planning to
    address the policy, rules of engagement, force employment, force
    readiness, and logistics support, and tying together diverse system
    elements including sensors, interceptors, and the command and control
    network.
        NORTHCOM and Pacific Command (PACOM) are our principal warfighting
    partners in preparation for activation of the initial defense
    capability. With them, we are continuing to refine and validate our
    plans in a series of exercises and readiness assessments designed to
    prepare the responsible combatant commands for assuming operational
    responsibility for the initial elements of this nascent defensive
    system.
        Operation Iraqi Freedom (OIF) demonstrated an unprecedented level
    of cross-Theater Missile Defense cooperation and coordination.
    Integrated early warning data from Army, Navy, Air Force, and other
    intelligence sensors provided vital data supporting Patriot missile
    engagements of all threatening theater ballistic missile launches.
    Expanding upon OIF's example of an integrated and effective defense,
    STRATCOM is developing the GMD CONOP and the battle management
    architecture to provide full capabilities for regional combatant
    commanders to defend their areas of responsibility (AORs).

        6. Senator Levin. Admiral Ellis, how will STRATCOM develop the
    CONOP that must be in place when the Ground-Based Midcourse Defense
    System deploys in September 2004?
        Admiral Ellis. STRATCOM's role is to define the CONOPs, begin
    training and integration, provide command and control capabilities, and
    to ensure that assumptions regarding the employment, weapons release
    doctrine, and similar issues are clearly understood and reviewed prior
    to initiating fielding of this capability by the end of the year. The
    initial CONOP has been developed in collaboration with NORTHCOM and
    PACOM.
        The assumptions we have made are based on sharing the data that has
    been generated by the Director, Operational Test and Evaluation (DOT&E)
    and the MDA through tests and simulations that have been conducted in
    developing this system. We draw on their expertise and experience with
    legacy systems. STRATCOM accesses the database in order to understand
    fully the system capabilities in this developmental mode, to ensure we
    have a process in place that allows us to bring on line a limited alert
    capability at the same time as we continue the spiral development
    process. From these assessments, we craft the Military Utility
    Assessment (MUA), CONOPs, and the procedures for its employment in
    support of the Nation's security.

        7. Senator Levin. Admiral Ellis, what are the assumptions that will
    be made in the CONOPs including assumptions regarding continued testing
    of the system, nature of the threat, and availability of naval ships
    for radar surveillance duty?
        Admiral Ellis. Assumptions used to formulate the CONOPs are being
    finalized. It is assumed that sufficient BMD Aegis capable ships will
    be available for 24/7 radar surveillance duties. Commander, PACOM has
    been working very closely with the Navy and the Chief of Naval
    Operations (CNO) to ensure this availability is realized.
        The operational systems will be at various levels of readiness and
    operational capability coordinated with the BMDS research, development,
    test, and evaluation (RDT&E) developmental program. Processes,
    procedures, and checklist have been developed to rapidly transition
    from a ``Test'' status to a fully operational mode.
        Finally, downtime required to support test, development, training,
    maintenance, or logistics requirements will be authorized by the
    supported commander as part of 24/7 operations in accordance with
    readiness conditions, indications and warnings, and in coordination
    with STRATCOM.

                              operational testing
        8. Senator Levin. Secretary Wynne, Admiral Ellis, Mr. Christie,
    General Kadish, and General Dodgen, do you support operational testing
    of weapon systems, approved and overseen by the DOT&E, to ensure the
    systems work?
        Mr. Wynne. Yes, I do.
        Admiral Ellis. Yes. The intent of the team is to bring as much of
    an operational character as possible to the process, and to test it
    when it is appropriate and when the system's maturity permits. It is
    contingent on the assessments that we make in the early phases, on what
    milestones are achieved, and what technical capabilities are added. As
    we quantify the capabilities that we have brought on line through 2004,
    2006, 2008 and beyond, we will be better able to characterize the
    evolving configuration and assess its operational capabilities.
        We are supporting independent testing by involving operational test
    and evaluation (OT&E) people in the process. With large-scale systems,
    the complexity of the tests, the expense of testing, and modern
    simulation capabilities allow us to integrate elements of both
    developmental testing and operational testing as the system evolves.
    Technology and simulation now allow us, for the first time, to bring
    these elements together in a concurrent manner that more efficiently
    uses national resources and, arguably, more quickly delivers the
    capabilities that we need.
        Mr. Christie. Yes, I do.
        General Kadish. Yes, I do. We are working very closely with Mr.
    Christie and the operational test community. As our tests are planned,
    executed, and evaluated, the BMDS combined test force, which brings
    together representatives from across the testing community, is
    combining requirements for both developmental and operational testing
    capability.
        There are approximately 100 operational test personnel, full-time
    embedded in all facets of missile defense test planning and execution,
    who have access to all of our test data. They have the ability to
    influence every aspect of our test planning.
        General Dodgen. Yes, I do. Operational testing is an important
    element of system development and acquisition process to ensure
    successful weapons are provided to the warfighters.

                         operational assessment of nmd
        9. Senator Levin. Mr. Christie, in a February 27 letter to me and
    Chairman Warner, you referred to ``operational assessments'' of the
    BMDS. Are you planning to do such an assessment prior to the September
    fielding of the National Missile Defense system, what is the purpose of
    the assessment, and when do you plan to complete this assessment?
        Mr. Christie. I plan to provide independent assessments of the BMDS
    capability as new data becomes available. The purpose of these
    assessments is to keep the Department apprised of the capability that
    has been demonstrated during major test events and to provide advice on
    making future tests more operationally relevant. These assessments will
    be provided to General Kadish, Admiral Ellis, and to Under Secretary
    Wynne in accordance with my responsibility to advise the Department on
    testing matters.

                  cost increases for national missile defense
        10. Senator Levin. Secretary Wynne, the Pentagon's budget request
    for missile defense is $1.2 billion more than last year. The 5 year
    budget projections for the Block 2004 and Block 2006 Ground-Based
    National Missile Defense (NMD) program have grown by almost $6 billion
    since last year, with most of the cost growth in fiscal years 2006 and
    2007. The total costs for this program have doubled in a single year.
    In any other program with normal DOD acquisition rules, such cost
    growth would trigger congressionally-mandated reviews, led by you, to
    determine what is wrong. What is wrong with the Ground-Based NMD
    program that is causing such tremendous cost growth, why have you not
    begun a review of the program in accordance with standard Pentagon
    procedures, and what confidence do you have that such cost growth won't
    continue to plague the program?
        Mr. Wynne. In the President's budget (PB) for fiscal year 2004,
    MDA's budget for Block 2004 and 2006 was $12.1 billion for fiscal years
    2005-2009. In the latest budget submission, PB05, this is now $17.7
    billion. This budget is for the entire MDA program of work in Block
    2004 and 2006, however, not just the Ground-Based Midcourse defense
    element. The increase is due, almost entirely, to new program content,
    the fielding of additional capabilities in 2006 and 2007, not cost
    growth. These capabilities include acquisition of additional ground-
    based interceptors, upgrades to the Thule early warning radar, an
    additional third missile field site, 40 Aegis SM-3 missiles, three
    additional deployed radars and an additional sea-based radar. In
    addition, this increase, relative to the 2004 President's budget,
    allows us to acquire 3 additional deployed radars, 40 Aegis SM-3
    interceptors, and begin an initial fielding of THAAD.
        I review the complete MDA program quarterly and meet with General
    Kadish on a weekly basis where I review cost, technical progress, and
    schedule for selected activities. If unwarranted cost growth were to
    occur, I am confident that it would receive adequate management
    attention both within MDA and by me.

                      testing against warheads and decoys
        11. Senator Levin. General Kadish, in 2000, Mr. Christie's
    predecessor criticized the NMD program for not having tested against
    realistic targets and decoys, and specifically urged that ``tumbling
    warheads with tumbling decoys'' need to be tested against, prior to
    deployment of the system, since they pose a particular challenge and
    yet are easy for an enemy to do. Do you plan to conduct testing again
    using tumbling warheads and decoys prior to the September deployment
    date, and if not, when will you?
        General Kadish. [Deleted.]

        12. Senator Levin. General Kadish, do you believe, as your
    predecessor did, that such warheads and decoys are a concern? If so, do
    you believe they should be tested against as soon as possible?
        General Kadish. Tumbling warheads and decoys are targets of concern
    and will be tested against. The timing of the testing will be driven by
    the maturity of the system and the threat the system is intended to
    deal with at any given point in time.

                        test and evaluation master plan
        13. Senator Levin. Mr. Christie, in your Annual Report to Congress
    back in 2002, you noted that the Test and Evaluation Master Plan (TEMP)
    for the National Missile Defense program needed to be updated to
    reflect the Bush administration's new approach to missile defense.
    Current law specifies that such plans should be approved by you, the
    DOT&E. Is there a TEMP, approved by you, for the Ground-Based National
    Missile Defense program?
        Mr. Christie. There is no TEMP for the BMDS. There is a BMDS
    Overarching Master Test Plan currently in draft, Block Master Test
    Plans for each development block, Developmental Master Test Plans for
    each element, and detailed test plans for each major test event. My
    staff reviews and comments on each of these documents. My office
    approves the operational objectives for any combined development and
    operational tests.

        14. Senator Levin. Mr. Christie, do such plans exist for other
    major defense programs to be deployed this year, or which have already
    been deployed?
        Mr. Christie. Yes, major defense acquisition programs have a TEMP
    that is updated at major milestones.

        15. Senator Levin. Mr. Christie, such plans generally include a
    schedule for operational testing, do they not?
        Mr. Christie. Yes, they do.

        16. Senator Levin. Mr. Christie, do you still believe, as you did
    in 2002, that a TEMP should be developed, under your direction and
    oversight, for the Ground-Based National Missile Defense system, and
    for other BMDS, and that such a plan should include a schedule for
    operational testing?
        Mr. Christie. The TEMP is still a valid goal for spiral or
    capability-based acquisition programs. I believe MDA plans to prepare a
    TEMP for an element when the decision is made to transition it to the
    Services. Due to the uncertainty in trying to project when an element
    will be mature enough to transition to a Service, it is difficult to
    realistically schedule and plan operational testing. The Services are
    responsible for planning and executing operational testing on these
    systems. They would be reluctant to use scarce, valuable resources to
    plan a test prior to knowing what and when they will be testing. Since
    the MDA programs are a special acquisition case in the Department,
    DOT&E and the Services are trying to work within the framework
    established for the BMD programs. We are, however, attempting to
    evaluate as many of the operational test objectives as possible during
    combined developmental and operational testing.

                 circumstances nmd deployment would be delayed
        17. Senator Levin. Secretary Wynne and General Kadish, are there
    any circumstances under which you would consider delaying the September
    deployment date of the Ground-Based Midcourse System?
        Mr. Wynne. The initial BMD capability will be placed in operation
    when it is ready. The exact date that this occurs will depend on the
    completion of required events, rather than a fixed schedule. Testing of
    the developing BMDS and assessments of its military utility conducted
    to date have not provided any indication of problems that would call
    for a delay in the fielding of the initial capability.
        General Kadish. The basis for confidence in the system to serve as
    an initial defensive capability is its demonstrated performance in
    ground and flight testing throughout the development test program and
    extensive modeling and simulation. We evaluate the results of each test
    event and make that data available to the combatant commands for their
    MUAs.

          deployment dates for ground- and sea-based missile defenses
        18. Senator Levin. Mr. Christie, in your February assessment of the
    BMDS, you assessed the sea-based Aegis missile defense as potentially
    having some operational capability against short-range missiles.
    However, in this same assessment, you did not say the same for the
    Ground-Based NMD that is to be deployed in September. For this system,
    all you said was, ``[The Ground-Based Missile Defense] is currently a
    developmental system with limited deployable hardware and software.''
    Why was your assessment of the two systems different?
        Mr. Christie. In all Aegis tracking and flight testing to date, the
    Navy has used operational ships and trained crews to conduct these
    tests. These tests have shown that the operational ships and crews are
    capable of intercepting short-range unitary targets. Thus, the Aegis
    has demonstrated some limited operational capability. The Ground-Based
    NMD System has not yet demonstrated a similar capability using the test
    bed's hardware and software and trained soldier operators.

        19. Senator Levin. Mr. Christie, why did you not say that the
    Ground-Based NMD could be employed against long-range missile threats?
        Mr. Christie. It never occurred to me that this would be a question
    at the time I prepared my report. It was obvious to me that the Ground-
    Based NMD System could not be employed against any threat because a
    deployable system did not exist at that time. Once the planned Ground-
    Based NMD System test bed is built and integrated, including missiles,
    it may have some inherent capability that could be used against long-
    range missile threats. The system has been designed and built to
    conduct this mission. As we begin to test the integrated system in the
    test bed, we will be able to characterize its capabilities more
    thoroughly.

        20. Senator Levin. General Kadish, the administration plans to
    deploy the Ground-Based NMD in September of this year, whereas the more
    mature and more capable sea-based system won't be deployed until next
    year. Why are you deploying the less mature and less capable system
    first?
        General Kadish. Later this year the United States will field an
    initial BMD capability as directed by the President. This so-called
    initial defensive capability will consist of both ground-based and sea-
    based components, including Ground-Based Interceptors (GBIs), and sea-
    based interceptors, the Standard Missile-3 (SM-3). The SM-3 interceptor
    is designed to engage short and medium range ballistic missile threats.
    A limited number of interceptors will be available during our initial
    fielding in the fall of 2004. The GBI is intended to defeat long-range
    missile threats. Both systems will continue to be tested using
    operationally realistic scenarios. These tests will help to provide
    enhancements to the systems as the technology matures.

                 nmd effectiveness under unforeseen conditions
        21. Senator Levin. Admiral Ellis, would you agree that any launch
    of a North Korean long-range missile against the U.S. would be an
    unforeseen event--if the U.S. knew such a launch were coming, surely we
    would take the necessary actions to prevent the launch from occurring
    at all?
        Admiral Ellis. As noted in the 2002 National Security Strategy
    (NSS), North Korea has become one of the world's principal developers
    and exporters of ballistic missiles and has tested increasingly capable
    missiles while developing an arsenal of weapons of mass destruction
    (WMD). The NSS directs that the U.S. maintain the option of preemptive
    action to counter a sufficient threat to our national security. The new
    global missions assigned to STRATCOM in Change 2 to the 2002 UCP
    provide additional capabilities that expand the options available to
    the President of the United States for deterring the use of WMD against
    the U.S. or our allies. Our Global Strike mission provides rapid,
    extended range, precision kinetic and non-kinetic (elements of space
    and information operations) effects in support of theater and national
    objectives. STRATCOM is developing capabilities that provide these
    integrated options, ranging from preemptive strikes prior to a missile
    launch to coordinated, offensive, and defensive retaliatory responses
    within our ISR mission, we are working to provide integrated
    information on threats, wherever they may emerge.
        Our military capability to decisively end any conflict on our terms
    with advanced non-nuclear and nuclear capabilities, if necessary,
    integrated with GMD casts a long shadow over an adversary's
    decisionmaking process by threatening unacceptable costs and denying
    the benefits he seeks. However, we do not rely on a deterrence strategy
    alone, but on the full range of capabilities we can marshal to protect
    our Nation and meet commitments to friends and allies.

        22. Senator Levin. Admiral Ellis, as the person responsible for the
    defense of the United States, would you like to see the Ground-Based
    Midcourse Defense System operationally tested in a combat-like way,
    under unforeseen conditions, as soon as possible to assess how it will
    work in battle?
        Admiral Ellis. My belief is that this effort is currently underway.
    Over an extended period of time, as we move through the developmental
    test phase, we are placing the system and evolving its capabilities in
    the operational environment where they would be employed. There are
    obviously elements that cannot and, hopefully, will never be tested
    from a full operational capability--such as, the launch of threat
    missiles from potential adversaries. I do believe that the elemental
    testing that is underway will characterize the dynamics of and the
    environment in which this system is intended to operate. We will define
    and refine the sensor capabilities. We will assess the command and
    control linkage and the command and control processes and all of those
    elements will then be integrated in a comprehensive manner.

        upcoming tests to use global positioning system to track target
        23. Senator Levin. Mr. Christie, the next major flight test of the
    Ground-Based NMD system is called the Integrated Flight Test (IFT-13C).
    According to the official test plan provided to us, IFT-13C will use
    the Global Positioning System (GPS) to help guide the interceptor to
    the target. The target has a GPS receiver on it, and it broadcasts its
    position to the missile defense system in the form of radar data that
    would otherwise exist, but which is not available in this test. Range
    safety aside, do any of the tests between now and September not use
    such GPS information to help guide the interceptor to the target?
        Mr. Christie. IFT-13C and IFT-14 will both use GPS information to
    provide target cluster positions to a simulation of the Cobra Dane
    radar.

        24. Senator Levin. Mr. Christie, range safety aside, when is the
    first test which will not use such GPS information to help guide the
    interceptor to the target?
        Mr. Christie. IFT-16A will fly a target out of Kodiak, Alaska down
    the west coast using Aegis and Upgraded Early Warning Radar with a
    simulated interceptor out of Vandenberg Air Force Base. In mid to late
    2005, IFT 17/18 will fly a target out of Kodiak using Aegis and the
    Upgraded Early Warming Radar, with a salvo firing of two interceptors
    out of Vandenburg.

                          testing prior to deployment
        25. Senator Levin. Mr. Christie, the test plan for the next NMD
    flight test, known as IFT-13C, says, ``the IFT-13C engagement geometry
    is highly scripted, and remains similar to prior flight tests, even
    with the advent of [an] improved booster.'' Is this highly scripted
    engagement geometry going to change for the tests that are scheduled
    between now and the September deployment?
        Mr. Christie. The geometries for IFT-13C and IFT-14 will be
    different from previous tests in that they each fly a target out of
    Kodiak. Both tests remain scripted in order to control variables due to
    their developmental nature.

        26. Senator Levin. Mr. Christie, will the tests that are scheduled
    between now and the September 2004 deployment all have essentially the
    same highly scripted engagement geometry which has been used in prior
    flight tests?
        Mr. Christie. The geometries for IFT-13C and IFT-14 will be
    different from previous tests in that they each fly a target out of
    Kodiak. Both tests remain scripted in order to control variables due to
    their developmental nature.

        27. Senator Levin. Mr. Christie, is this engagement geometry at all
    similar to what one would expect to see if North Korea launched a
    missile at the U.S. west coast, and the interceptors deployed at Ft.
    Greeley were used to try to hit it?
        Mr. Christie. Testing to date was not planned to demonstrate
    Initial Defense Operations (IDO) capability and has not been
    particularly representative of such scenarios. While IFT-13C and IFT-14
    do not replicate that engagement geometry, they have been tailored to
    be more representative of that mission and do create more realistic
    engagement conditions.

        28. Senator Levin. Mr. Christie, if the North Koreans ever did
    launch a missile at the U.S., would the resulting engagement be
    ``highly scripted,'' as the tests now are?
        Mr. Christie. Obviously, the engagement would not be scripted.
    There would probably be some warning that an attack is imminent, but,
    for the most part, the mission would be spontaneous.

        29. Senator Levin. Mr. Christie, what are some of the uncertainties
    that a real threat missile would present us with, that the tests
    between now and the planned deployment will not address?
        Mr. Christie. There are many uncertainties about the threat (launch
    time, missile flight stability, intended target, type of warhead,
    countermeasures, etc.) that may affect performance. The MDA is
    addressing many of these uncertainties through simulation, while others
    will not be addressed until later blocks. Full-up system testing is
    building toward more realistic tests, but we will never be able to
    exercise all the threat uncertainties fully in flight tests. More
    realistic flight tests will be used to validate system performance
    models. We will depend on ground tests, hardware-in-the-loop
    simulations and other models to explore performance in more realistic
    attack scenarios.

                         realistic operational testing
        30. Senator Levin. Admiral Ellis, you will be responsible for
    operating the NMD and protecting the U.S. from nuclear-armed missile
    attack, beginning in September 2004. Do you want this system tested
    under realistic, combat-like conditions, as soon as possible?
        Admiral Ellis. The continued testing that OT&E and the MDA are
    pursuing is, in my view, going as aggressively as is appropriate and
    prudent. As capabilities are delivered, they are tested and assessed,
    and changes are immediately made to reflect the lessons learned. A
    system of this scale and complexity is unique in the history of the
    Nation. It requires a global test range in order to put all these
    elements in place, and so in my view, there is a logic in putting it in
    place where it is intended to operationally serve.
        From an operational standpoint, testing at the actual sites from
    which it will be expected to operate with all of its elements is about
    as realistic an operating environment as we could expect. As we
    continue to refine and advance testing in an operational environment,
    we will significantly enhance the operational character of the tests
    that will unfold in the years ahead.

        31. Senator Levin. Mr. Christie, as the Pentagon's chief tester,
    you have expressed concerns about the maturity of NMD, and its
    readiness to go up against real threat missile. Would you therefore
    want to see us focus our resources on realistic operational testing of
    this system, under combat-like conditions, as soon as possible?
        Mr. Christie. More realistic testing should be performed as soon as
    the system is ready. It is prudent to exploit the inherent operational
    capability of the test bed and to characterize that capability as soon
    as possible.

                          russian maneuvering warhead
        32. Senator Levin. Mr. Christie, the Russians have announced
    recently that they have developed a maneuvering warhead that can evade
    the missile defense that the administration plans to deploy in
    September. Assuming the Russians are telling the truth, could such a
    maneuvering warhead possibly be able to evade our missile defense?
        Mr. Christie. I am unable to assess the BMDS capability against
    this maneuvering warhead at this time. In general, weapon systems with
    a closed loop fire control guidance system can deal with maneuvering
    targets, within the dynamic limits of the system. The objective BMDS
    should be able to close the guidance control loop in several ways.

                     advance knowledge of target signatures
        33. Senator Levin. Mr. Christie, the test plan for the next major
    NMD test, known as IFT-13C, says that the NMD system has ``advance
    knowledge of the target signatures. The accuracy of this data is much
    higher than is realistic for [a] threat missile.'' Do you think we will
    know what a real enemy missile will look like in such great detail?
        Mr. Christie. Probably not.

        34. Senator Levin. Mr. Christie, have all previous missile defense
    tests been conducted with such detailed advance knowledge of the
    target?
        Mr. Christie. Advance knowledge of the target is a common practice
    in developmental testing when the objective is to understand and
    confirm the missile design and technical performance. This is not the
    practice in operational testing.

        35. Senator Levin. Mr. Christie, if a real threat missile turns out
    to look significantly different than the test targets, could that cause
    the missile defense to be degraded, or even to fail completely?
        Mr. Christie. The MDA is not designing the BMDS to have capability
    against a specific threat missile or signature. Their design appears to
    be flexible enough that the BMDS will be capable of engaging threat
    missiles over a wide variety of signatures, countermeasures and flight
    dynamics. If they prove successful in this approach, the threat missile
    signature should not make a significant difference to the performance
    of the BMDS. Initial analyses indicate their approach is promising.
    This capability will have to be confirmed in both ground and flight
    testing.

                     space-based interceptors affordability
        36. Senator Levin. General Kadish, your budget request includes
    nearly $80 million for space-based weapons-related research and
    development (R&D). $68 million of that is to actually launch a short-
    range kill vehicle into space on the Near Field Infrared Experiment
    (NFIRE) satellite. Are you aware of the study by the American Physical
    Society (APS) that indicated you would need a thousand or so space-
    based interceptors (SBIs) in orbit in order to make an effective
    system, and the follow-on study by the Congressional Budget Office
    (CBO)--which used much more optimistic assumptions, but still concluded
    that hundreds of interceptors would have to be launched?
        General Kadish. The $68 million of the nearly $80 million you
    reference is for our NFIRE. NFIRE is an on-orbit satellite experiment
    that is a risk reduction effort for our BMDS Block 10 land-based
    Kinetic Energy Interceptor (KEI) program. It is not part of our SBI
    efforts. The objective of NFIRE is to collect near field (sub-meter
    resolution) infrared imagery of the plume and hard body of boosting
    intercontinental ballistic missile (ICBM)-type targets. KEI will use
    this data to develop the kill vehicle plume-to-hard body guidance
    algorithms for our land and sea-based systems. We are not planning any
    follow-on NFIRE satellites.
        Yes, I am aware of the APS study and that the CBO is conducting a
    follow-on study. We have not seen the CBO report yet. In fiscal year
    2003, the National Team developed a response to the APS which analyzed
    space based interceptor constellation sizes and came to a conclusion
    that constellations of 150-450 would be required.

        37. Senator Levin. General Kadish, have you done any cost studies
    to see what the total cost to orbit and maintain such large
    constellations of satellites would be?
        General Kadish. This year (fiscal year 2004) we do not have funding
    for any SBI efforts. However, we are currently working with the Missile
    Defense National Team to try to understand the value of SBI to the
    layered BMDS. For the Nimble Titan 04 wargame, we have modeled a small
    SBI constellation (10 satellites) to begin to understand the military
    utility of an SBI as well as to understand the constellation size
    required to defend against a single threat country.
        For fiscal year 2005 we have requested nearly $11 million to
    continue this analysis. Also we plan to initiate SBI technology risk
    reduction projects that will focus on capability miniaturization (e.g.,
    seeker and propulsion) and affordability.

        38. Senator Levin. General Kadish, do you believe we could afford
    such large constellations of satellites, when we are currently
    struggling to keep far smaller and less complex satellite programs on
    schedule and on budget?
        General Kadish. One of my goals is to understand the point (minimum
    constellation size and associated BMDS interfaces) at which an SBI
    capability begins to cost-effectively contribute to a layered defense
    against all threat classes in all phases of flight. Until I understand
    that point, I am not comfortable speculating on affordability.

                        space-based interceptors policy
        39. Senator Levin. Secretary Wynne, General Kadish wants to spend
    close to $80 million next year on research related to SBIs. I
    understand that such interceptors could also be easily used to destroy
    enemy satellites, if we chose to do so. What is the Pentagon's current
    policy regarding such space-based weaponry, and would such a SBI system
    be consistent with that policy?
        Mr. Wynne. Americans have come to rely on the unhindered use of
    space and will demand no less in the future. This includes robust
    capabilities for assured launch and space control. While the United
    States supports the peaceful use of space by all, prudence demands that
    we be able to ensure the United States, its allies, and coalition
    partners will be able to make use of space.
        Of the $80 million referenced in the question, only $10.5 million
    will be for research related to SBIs. That amount will fund risk
    mitigation and definition of the operational concept for a space-based
    test bed that could be available for deployment in 2012. However, a
    decision is not expected prior to 2008 on whether to proceed with an
    on-orbit test bed of a small constellation. If fielded, tile SBIs would
    be part of a layered defense against ballistic missiles, not for
    attacking enemy satellites. Ultimately, any future action to deploy
    interceptors in space would require additional Department and
    congressional decisions and funding.
        The remainder of the $80 million figure ($69.5 million) is to fund
    the NFIRE, an on-orbit satellite to collect measurements of boosting
    targets. NFIRE is critical to reducing the risk of booster plume-to-
    hard-body discrimination for the Block 10 KEI program, to maturing the
    technology of the kill vehicle component of the KEI, and to enabling
    the verification and validation of the KEI performance.

                             airborne laser program
        40. Senator Levin. General Kadish, the General Accounting Office
    (GAO), the investigative arm of Congress, recently completed an audit
    of the ABL program, and briefed the committee staff on the preliminary
    results. The GAO audit found that the program has experienced
    tremendous cost growth, driven by numerous technical problems and
    schedule delays. I know you have recently restructured the program, but
    you are still requesting at a very high level of funding for it in
    fiscal year 2005. At what point do the delays, problems, and cost
    growth for the ABL grow so large that it is not worth continuing such
    aggressive funding for the program--at what point do you reduce funding
    to more of a basic science and technology (S&T) level, and focus
    resources on other areas?
        General Kadish.
        a. The ABL program represents a revolutionary weapons concept that
    requires the integration of several sophisticated state-of-the-art
    technologies. Expertise is required in a diverse range of technologists
    including laser physicists, optical engineers, and aeronautical
    engineers. The current level of funding for the ABL program reflects
    the resources needed to successfully accomplish that complex
    integration.
        b. If you note, the funding request for 2005 actually represents a
    decrease of over $160 million from the original fiscal year 2004
    presidential budget submission. This is the result of a conscious,
    proactive decision to defer certain work until key knowledge points
    were achieved. Our external technology reviews continue to conclude the
    underlying physics is sound, the proposed engineering path forward is
    sound, and its potential is revolutionary. This explains why steady
    progress is being made, albeit slower than desired. Regardless, we
    understand that cost control is an important concern, which is why we
    continue to monitor the program closely, in accordance with sound
    financial management principles.
        c. The ABL, once completed, will offer a unique and critical
    military capability of significant benefit to the BMDS in support of
    boost phase missile defense. As the first system to use directed energy
    to kill a launching missile, it represents a radical departure from
    hit-to-kill systems, complementing other BMDS capabilities. It is
    technically achievable, and affordable within the BMDS. Therefore, at
    this time the program merits continuation, as currently funded.

                    event-driven approach to missile defense
        41. Senator Levin. General Kadish, in 1999, defense expert General
    Larry Welch completed a review of the NMD program which had been
    requested by the Pentagon. In written testimony before the Senate Armed
    Services Committee in June of 2000 you summarized the results of
    General Welch's report by saying, ``General Welch's team highlighted
    three basic criticisms. One of them, the so-called ``rush to failure''
    criticism, was the judgment that we were being too schedule-driven as
    opposed to event-driven in the development of the system. In response .
    . . we made a major philosophical change, namely to be event-driven
    rather than schedule-driven. . . . The program, in spite of the
    schedule urgency, must be event-driven, that is, not held to calendar
    dates even if performance has not yet been satisfactorily demonstrated.
    This is our approach.'' By deciding to deploy by September, apparently
    regardless of the results of any future flight tests or other major
    events you have planned, it appears you have gone back to being very
    schedule-driven in this program. Aren't you now back to the ``rush-to-
    failure'' mentality that General Welch criticized you for?
        General Kadish. Several things make the current situation very
    different from the program that General Welch evaluated in 1999. First,
    General Welch conducted his evaluation in the context of the so-called
    ``3+3'' program. That is, beginning in 1997, the NMD program was
    directed to conduct 3 years of development and deploy 3 years
    thereafter. This was truly a schedule-driven program such that a
    predetermined development stage, followed by a predetermined deployment
    phase, were the driving factors for the effort. MDA took this critique
    seriously, and we revised the entire program, including the NMD
    program, transforming it into capabilities-based development effort.
    Decisions would be made to deploy capability when that capability had
    reached a sufficiently mature point during development. When we made
    this transformation, I concluded that we could put in place a BMDS test
    bed by September 2004 to conduct more realistic BMD testing. The test
    bed concept addressed another of General Welch's critiques. This
    decision and the associated date were based on my evaluation of the
    development program--it was not driven by external direction. At the
    time, I made the point that this test bed could be used in an emergency
    role if necessary. September 2004, therefore, was our planning date for
    a BMDS test bed that could be used in an operational role if
    circumstance required. Subsequently, the President decided that we must
    deploy a BMDS. He directed DOD to use the BMDS test bed as the basis
    for this deployment, and to build on it to provide an evolutionary
    BMDS. September 2004 date has always been an internal planning date,
    and we did not change it after the President's decision. The September
    2004 date is frequently used internally as a deadline, as a planning
    tool, and as a motivating tool, but it was derived after the adoption
    of a capabilities-based approach to the BMD. It was not schedule-
    driven.

                                 simulated data
        42. Senator Levin. Mr. Christie, in your recent report to Congress
    submitted in January, you state that, ``Due to immature Ballistic
    Missile Defense System elements, very little system level testing was
    performed by the close of fiscal year 2003. Therefore, the system
    capabilities assessed for [the September deployment] will be based on
    test events planned for fiscal year 2004. These tests will be executed
    using simulated or theoretical performance characteristics for some
    elements.'' Why will you need to use simulated data for these upcoming
    tests, and how will that affect your ability to assess the system's
    performance?
        Mr. Christie. Both ground and flight testing will be limited prior
    to any deployment of elements of the test bed in 2004. Since some of
    the elements that either will be deployed or are representative of what
    will be deployed are not yet available, simulations are being used to
    provide better understanding of the BMDS capability. Since a mobile
    target launch capability is not yet available to launch a target
    through the Cobra Dane field of regard, a digital emulation of Cobra
    Dane will be used. Some of these simulations are considered
    ``theoretical'' because the testing has not yet been conducted that
    will provide the data to validate the simulation. The testbed using
    actual hardware and software operated by trained military operators is
    intended to correct this limitation.

        43. Senator Levin. Mr. Christie, when do you think you will be able
    to use actual, vice simulated, data for these system elements?
        Mr. Christie. As the BMDS matures and the elements are incorporated
    into the test bed, they will replace their respective simulations or
    emulations. The engage on Cobra Dane sequences will continue to rely on
    simulated Cobra Dane performance until target development permits the
    launch of a target through its field of regard. The test bed will begin
    to remove other artificialities beginning with the next flight test.

                                  x-band radar
        44. Senator Levin. General Kadish, during your tenure with the
    previous administration, you testified before Congress, and told the
    press, that building an X-band radar (XBR) at Shemya in the Aleutians
    was the ``long pole in the tent'', meaning that it was on the critical
    path to establishing a viable system. Yet President Bush has never
    requested funds to build an XBR at Shemya, and has decided on a
    floating XBR system instead. Why have you not requested funds for this
    radar, and when will the floating radar be available?
        General Kadish. The Sea-based X-Band Radar (SBX) was the result of
    changes in the GMD mission and program focus in 2002 and the U.S.
    withdrawal from the Anti-Ballistic Missile (ABM) Treaty.
        Prior to 2001, a land-based XBR was planned for Shemya Island,
    Alaska. From that location, an XBR would provide ballistic missile
    acquisition, tracking, discrimination, and kill assessment for the
    United States. In July 2001, the GMD Joint Program Office changed its
    near-term mission from deployment of a missile defense capability
    covering the U.S. to a robust test architecture in the Pacific that
    would also provide some limited operational utility.
        As the test bed was laid out in 2001, it was discovered that many
    threat representative trajectories could not be supported by a Shemya-
    based XBR. This necessitated exploration of additional radar sites and
    concepts. As a result, the SBX concept was developed. SBX will provide
    the capability to support identified test bed flight test missions and
    will be a mobile asset that allows operational capability. This
    mobility was not allowed under the ABM Treaty.
        It is important to note that either an SBX or a land-based Shemya
    XBR could provide a high degree of ballistic missile sensor capability.
    The major difference is the actual mission that each performs. The
    Shemya radar would have been affixed operational asset providing robust
    missile defense capability but was not located to support the test
    architecture. The SBX offers a movable sensor that maximizes the test
    bed's utility, which will ultimately result in a more flexible
    operational missile defense system.
        The SBX is scheduled to be integrated into the BMDS at the end of
    fiscal year 2005.

        45. Senator Levin. General Kadish, I understand you plan to use the
    floating radar as a test asset, as well as an operational one. When the
    floating radar is participating in a test, can it still be used as a
    defense against a real missile attack?
        General Kadish. Yes, the SBX can fill its defensive role while
    testing. The SBX, like other BMDS components, is subject to recall for
    defensive operations whether it is participating in a flight or ground
    test, undergoing routine maintenance, in transit, or in any other
    status.

      office of management and budget rating of the missile defense agency
        46. Senator Levin. Secretary Wynne and General Kadish, as part of
    President Bush's Government Accountability Initiative, the Office of
    Management and Budget (OMB) has graded a number of defense programs,
    including missile defense. Two of the OMB ratings for the MDA were as
    follows: Planning: 56 percent; and Results: 67 percent. The OMB said
    the missile defense program has, ``major flaws that would limit the
    program's effectiveness.'' One of the major flaws identified by OMB is
    that DOD has refused to budget for the costs to actually deploy and
    sustain an effective missile defense. As OMB says, ``given that
    [missile defense] deployments can require multiple billions of dollars,
    failing to program these funds in advance will result in major budget
    turbulence following a [missile defense] deployment decision--
    turbulence that will result in cutbacks or terminations of other DOD
    activities, potentially including missile defense itself.'' I would
    like you to respond to OMB's criticism and tell me how you plan to get
    better grades next year.
        Mr. Wynne. As stated in a 2002 presidential directive, the DOD will
    employ an evolutionary approach to the development and fielding of
    missile defense in order to improve our defense over time. There will
    not be a final, fixed missile defense architecture. Rather, we will
    deploy an initial set of capabilities that will evolve to meet the
    changing threat and to take advantage of technological developments.
    The composition of missile defense, to include number and location of
    elements fielded, will change over time. To implement this approach,
    the DOD will field ballistic missile defense capability in 2-year
    blocks. The composition of a block will be a function of several
    factors, including threat developments, advances in BMD technologies,
    demonstrated performance of developmental components in the test
    program and the availability of resources. The DOD has programmed funds
    for Blocks 2004 and 2006, and the Air Force has programmed funds for
    the ABL, but no decisions have been made concerning the fielding of
    capability beyond 2008. As a result, we have not yet determined the
    funding requirements or programmed funds for this purpose.
        General Kadish. I would like to add to Mr. Wynne's answer that each
    year, MDA will assess the capability being developed and make
    recommendations regarding the potential to field additional capability.
    Funding decisions with respect to this additional capability will be
    made at the departmental level when MDA makes (and the Secretary
    approves) a fielding recommendation. At that time, MDA will either be
    provided with identified funding required to field the capability, or
    will be required to rebalance funding between developing and fielding
    capability. This approach is consistent with the direction provided by
    the President in a Presidential Directive dated 2002. Fielding
    decisions have been made for Block 2004 and Block 2006. Furthermore,
    funding has been provided to MDA's Total Operational Authority (TOA) to
    field this capability. With regard to operations and support (O&S), the
    Secretary of Defense has directed MDA and the Services to develop cost
    estimates for O&S on systems being fielded and to provide funding in
    the Project Objective Memorandum (POM) beginning in fiscal year 2006.
    Currently MDA and Services are collaborating to determine the
    responsibilities for funding out years. Funding for O&S in fiscal year
    2005 is the responsibility of the Services, while funding for
    Contractor Logistics Support will remain the responsibility of MDA.

                         live target intercept testing
        47. Senator Levin. General Kadish, how many live target intercept
    tests have you conducted to date using only ship-based radars to track
    a long-range target, with no help from the GPS, as the operational
    system will have to do to protect Hawaii?
        General Kadish. None. We have tested mid-range targets with only
    ship based radars. We are still in the process of integrating the Aegis
    radar system and the GMD system for an initial BMDS capability, which
    is required to use ship-based radars for long range targets. This
    interface will be tested prior to IDO. However, until we field the SBX
    we will not be able to conduct tests without the use of GPS on the
    target for simulated Hawaii scenarios. All GPS data used has been
    modified to represent the reduced accuracy of the sensor it is
    emulating.

        48. Senator Levin. Admiral Ellis, you are the person responsible
    for protecting all 50 States from missile attack. Will a Navy ship be
    on station, 24 hours a day, 7 days a week, to protect Hawaii from a
    long-range missile attack, starting in September?
        Admiral Ellis. As a function of the defined threat level, Navy
    ships will be on station for their initial search and track
    capabilities and contribute to the sensor net that will enable the
    employment of the interceptors that are an essential element of this
    system. Using a graduated level of alert, Navy ships will contribute to
    the effectiveness of the entire network, and that network will then
    contribute to our ability to defend all of the United States from this
    threat.

        49. Senator Levin. General Kadish, of the 30 interceptors to be
    bought in fiscal year 2004 and fiscal year 2005, how many will be
    launched in tests, what is the approximate schedule for testing for
    these interceptors, and when will the last of these 30 interceptors be
    launched as part of a test?
        General Kadish. Through the end of fiscal year 2006, MDA plans to
    utilize 11 interceptors in flight testing. The attached slide entitled
    ``Ground-Based Midcourse Defense Test Schedule and Description'' shows
    the currently planned testing schedule.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                          shoot-look-shoot capability
        50. Senator Levin. General Kadish, in previous testimony on the NMD
    system, you said: ``The big advantage of the mid-course, from a
    defensive point of view, is that we have relatively more time to react
    than during the other two phases. We have more time to make decisions,
    to sort the decoy from the warhead, and to ensure human-in-the-loop
    control. This extra time also allows us the ability to shoot, and then
    verify the success of that shot, and then shoot again if necessary, a
    so-called ``shoot-look-shoot'' capability. Additionally, multiple shots
    (simultaneously and/or sequentially) at the target give a higher
    probability of being able to hit it.'' Will the NMD system deployed in
    September have the ``shoot-look-shoot'' capability? If not, why not,
    and how much will this degrade the system's effectiveness?
        General Kadish. Mid-course systems provide much longer decision
    times. Shoot-look-shoot capability is dependent on locations and
    orientations of midcourse sensors and the location of the defended
    asset relative to the threat launch.
                          intercept test cancellations
        51. Senator Levin. General Kadish, after the December 2002 decision
    by the President to deploy a NMD in 2004, you decided to cancel six
    intercept tests that had been planned for fiscal years 2003 and 2004.
    The last intercept test was IFT-10, conducted in December 2002, and it
    failed. There is now only one scheduled intercept test between now and
    the planned September deployment date. When asked at the hearing why
    you cancelled these tests, you replied that you hadn't cancelled them,
    you just ``rescheduled'' them in order to focus on development of the
    new operational booster rocket. Why did you decide to reschedule them,
    when they could have provided important data on the performance of the
    system that you plan to deploy in September?
        General Kadish. The decision to reschedule the tests was made for a
    variety of reasons. The MDA has long held that it will adjust its
    programs and schedules based on the outcomes of its flight tests. It
    would be fiscally irresponsible--while adding little to the current
    pool of data--to conduct another flight test using the same
    configurations and components that were tested in four previous
    consecutive successful GMD flight tests. Therefore, the MDA and the GMD
    Prime Contractor prudently decided to reprioritize the tests and test
    objectives to concentrate on the least mature component of the GMD
    element--the booster. Additionally, two separate manufacturing process-
    related accidents in 2003 caused a delay in the development of the
    Lockheed-Martin BV+ booster, necessitating rescheduling of integrated
    flight tests with these boosters. Lastly, the rescheduling of these
    tests will allow MDA to conduct more fully integrated flight testing
    involving the various MDA elements, using more operationally
    representative hardware and demonstrate the ability to conduct
    concurrent test and operations.

        52. Senator Levin. General Kadish, could you have continued
    intercept testing concurrently with new booster development--or did the
    decision to deploy divert funds from intercept tests into new booster
    development?
        General Kadish. Our intercept testing program has continued
    concurrently with new booster development, but testing has been
    rescheduled. The presidential direction to field an initial defensive
    capability by the end of 2004 did not divert funds from intercept
    testing to new booster development but the testing was resequenced. The
    additional fielded assets were already fully funded.
        It was imperative at the time to focus on the booster development
    to ensure that the MDA has boosters ready that meet performance
    objectives. Four successful hit-to-kill missions (IFT-6, IFT-7, IFT-8,
    and IFT-9) immediately prior to the decision to focus on booster
    development gave the MDA the confidence in the system to make that
    decision.

        53. Senator Levin. General Kadish, the DOT&E, in his Annual Report
    to Congress submitted in January of this year, noted that a ``track
    gate anomaly'' in the kill vehicle had existed in intercept tests IFT-
    7, -8, and -9. I also understand that repeated attempts to fix this
    problem have so far proved unsuccessful, and that this problem could
    cause the interceptor to miss its target by losing track. Why didn't
    you continue intercept tests at least until this known ``track gate
    anomaly'' problem was proven to have been fixed?
        General Kadish. The MDA is confident that it has found the root
    cause of the track gate anomaly, and that proper corrective action has
    been taken to prevent its recurrence. IFT-10 incorporated design
    corrections to correct the anomaly, but the Exoatmospheric Kill Vehicle
    (EKV) experienced a malfunction and did not separate from the booster.
    This prevented demonstration of the corrective action for the track
    gate anomaly. IFT-13C and IFT-14 will provide opportunities to prove
    that the track gate anomaly is corrected.

        54. Senator Levin. General Kadish, why didn't you continue
    intercept tests against more stressing targets, as the DOT&E has
    recommended, to provide higher confidence that the kill vehicle could
    handle real threat missiles, prior to the deployment in September?
        General Kadish. In consideration of the most likely near-term
    threat and the imperative of the president's direction, it was decided
    the achievement of basic initial deployment capability as soon as
    possible was more advantageous than delaying for a more robust system.
    Targets are progressively evolving to become ``more stressing'' as each
    successful flight test proves new GMD capability. The target for IFT-
    13C is more stressing than earlier flight tests. GMD will take this
    first step and then mature the fielded system.

        55. Senator Levin. General Kadish, prior to the President's
    announcement to deploy a NMD, all of the NMD ground-based interceptors
    (GBIs) which were already built or were planned had been allocated for
    flight testing. Do you now plan to use interceptors (or kill vehicles)
    that had been allocated for intercept tests for deployment instead? If
    so, how many have been reallocated from testing to deployment and why
    was this reallocation done?
        General Kadish. No interceptors or kill vehicles purchased for
    intercept tests have been reallocated as fielded assets.

                           missile defense production
        56. Senator Levin. Secretary Wynne, current law says that initial
    operational test and evaluation needs to be completed prior to going
    beyond ``low rate initial production'' (LRIP). You are responsible for
    defining, for a given program, what LRIP constitutes. I understand that
    you are requesting funding in fiscal year 2005 to produce NMD GBIs at
    the production capacity of 12 per year. This would appear to be by
    definition beyond LRIP. Yet at the hearing, you said that 12
    interceptors per year is not beyond LRIP. If producing interceptors at
    the production capacity is not beyond LRIP, what is beyond LRIP for
    this system, and when will the ground-based missile defense system get
    beyond LRIP?
        Mr. Wynne. The GBI is part of the Ground-Based Midcourse Defense
    element of the BMDS major defense acquisition program, which has not
    entered LRIP. We intend to field a BMDS that fully integrates all
    program elements such as the Ground-Based Midcourse Defense. Thus, LRIP
    applies only in the context of the BMDS and not in terms of any element
    of BMDS. For this reason, the work being done on components of the
    Ground-Based Midcourse Defense element does not constitute LRIP for the
    BMDS.

                    flying interceptors out of fort greeley
        57. Senator Levin. General Kadish, you said at the hearing that you
    had plans to fly interceptors out of the Fort Greeley site, where most
    of the interceptors you plan to deploy starting in September will be.
    However, my understanding is that safety restrictions prohibit you from
    flying interceptors out of Fort Greeley, because the interceptor, or
    its spent stages, could impact in populated areas. On July 31, 2001,
    Dr. Patricia Sanders of the Ballistic Missile Defense Organization
    testified to that fact before the Senate Appropriations Committee. How
    do you plan to circumvent these safety restrictions in order to launch
    from Fort Greeley?
        General Kadish. We have initiated environmental and safety studies
    addressing the feasibility of flying test interceptors from Fort
    Greeley. Once these studies are complete, we will decide if we will
    pursue such tests, and we will not circumvent any safety restrictions
    identified. This will not likely occur before 2007.

        58. Senator Levin. General Kadish, how will you prevent a
    interceptor that goes off course, or a spent stage, from threatening
    populated areas?
        General Kadish. For GMD flight testing, command destruct systems
    are installed on interceptors and targets, enabling range safety
    processes to protect populated areas. Fielded GMD interceptors are not
    equipped with a command destruct capability. The GMD engagement
    planning considers spent stage drop zones and utilizes fly-out
    trajectories that minimize risks to populated areas.

        59. Senator Levin. General Kadish, by when do you believe you will
    begin launching interceptors from Fort Greeley?
        General Kadish. We have initiated environmental and safety studies
    addressing the feasibility of flying test interceptors from Fort
    Greeley. Once these studies are complete, we will decide if we will
    pursue such tests, and we will not circumvent any safety restrictions
    identified. This will not likely occur before 2007.

                             cost increases for nmd
        60. Senator Levin. Secretary Wynne, the 5-year budget projections
    for the Block 2004 and Block 2006 Ground-Based NMD program have grown
    by almost $6 billion since last year, with most of the cost growth in
    fiscal year 2006 and fiscal year 2007. When you were asked about this
    at the hearing, you and General Kadish said that the cost growth was
    because you had put ``place holders'' in so that you have the
    ``capacity to expand'' in fiscal year 2006 and fiscal year 2007. What
    is the basis for $6 billion worth of unidentified ``place holders?''
        Mr. Wynne. The budget figures referenced include funds for the
    Ground-Based Missile Defense element, as well as other components to be
    fielded in each block. In the President's budget for fiscal year 2004,
    MDA's budget for Block 2004 and 2006 was $12.1 billion for fiscal year
    2005-2009. In our fiscal year 2005 budget submission, the Block 2004
    and 2006 budget is $17.6 billion. The primary reason for this increase
    is the addition of a follow-on Block 2006 capability for deployment; it
    is not a ``place holder.'' The deployment of the Block 2006 capability
    added $3.8 billion to the MDA budget. It will provide our Nation with
    enhanced missile defense capability through the acquisition of
    additional GBIs for Fort Greeley, Alaska, upgrades to the Thule early
    warning radar, long lead activities for fielding of a potential third
    missile field site, and initiates acquisition of an additional sea-
    based radar. Furthermore, this increase initiates acquisition of 3
    additional deployed radars, 40 Aegis SM-3 interceptors, additional ship
    sets for Aegis destroyers, and begins an initial fielding of a THAAD
    firing battery.

        61. Senator Levin. Secretary Wynne, are there any other Pentagon
    acquisition programs which have $6 billion allocated to ``place
    holders?''
        Mr. Wynne. No. It is important to add that the figure quoted is not
    merely a placeholder. The funds are being set aside to fund further
    enhancements to our missile defense capability through the acquisition
    of additional GBIs for Fort Greeley, Alaska, upgrades to the Thule
    early warning radar, long lead activities for fielding of a potential
    third missile field site and initial funding to acquire an additional
    sea-based radar. Also, the funds would initiate acquisition of 3
    additional deployed radars, 40 Aegis SM-3 interceptors, additional ship
    sets for Aegis destroyers, and begin an initial fielding of THAAD.

        62. Senator Levin. Secretary Wynne, do you have any ideas as to
    what this funding could be used for?
        Mr. Wynne. This funding will provide our Nation with enhanced
    missile defense capability through the acquisition of additional GBIs
    for Fort Greeley, Alaska, upgrades to the Thule early warning radar,
    long lead activities for fielding of a potential third missile field
    site, and initiates acquisition of an additional sea-based radar. In
    addition, this increase initiates acquisition of 3 additional deployed
    radars, 40 Aegis SM-3 interceptors, additional ship sets for Aegis
    destroyers, and begins an initial fielding of THAAD.

        63. Senator Levin. Secretary Wynne, do you believe it is a wise
    acquisition policy to lack a firm basis for $6 billion worth of planned
    funding, and if so, what other acquisition programs, besides missile
    defense, do you plan to apply this policy to?
        Mr. Wynne. What we are doing with the missile defense program in
    this regard is similar to what is done in all defense acquisition
    programs. The budget is an estimate of future requirements. In general,
    when the Under Secretary of Defense for Acquisition, Technology, and
    Logistics (USD(AT&L)) authorizes program initiation at Milestone B, the
    Service having responsibility for the program will have created a
    program plan and budget that includes funding to procure an inventory
    objective well in advance of a procurement decision, which occurs at
    Milestone C. Following approval to transition to Milestone C, the funds
    previously set aside are used for the approved procurement.
        Where the missile defense program differs from this model is the
    lack of a fixed inventory objective. As stated by the President, we
    will not have a final, fixed missile defense architecture. Rather, we
    will deploy an initial set of capabilities that will evolve over time
    to meet the changing threat and to take advantage of technological
    developments. The composition of missile defenses, to include number
    and location of elements deployed, may change over time. Under the
    DOD's spiral acquisition strategy, a block configuration is developed
    for fielding on the basis of threat developments, the maturity of
    technologies, and the availability of funding. When a block fielding
    decision is made, the DOD allocates funds for that purpose. Until the
    composition of the block is fully and specifically defined, funds set
    aside for its fielding may have the appearance of a ``placeholder,''
    but it represents the Department's best estimate of the planned
    program.

                    impact of next flight test on deployment
        64. Senator Levin. General Kadish, you testified at the hearing
    that you do not have an interceptor that is in a realistic
    configuration right now. The next scheduled intercept test, IFT-14, is
    the first intercept test to use the new ``realistic'' booster design
    needed for the operational system and is the only intercept test
    scheduled between now and the end of September. Will you delay the
    planned September deployment of the Ground-Based Midcourse NMD system
    if the IFT-14 test fails to intercept the target?
        General Kadish. The determination that the initial defensive
    capability can be placed on alert is based on many factors, not just a
    single intercept test. We have taken into consideration the
    demonstrated performance of the system in ground and flight testing
    throughout the developmental test program, modeling and simulation, and
    the fact that a limited capability is better than none at all. If we do
    not achieve an intercept during IFT-14, we will evaluate the cause,
    assess the impact of the failure within the context of the wealth of
    other indicators of system performance, and make the appropriate
    recommendation to the DOD.

        65. Senator Levin. General Kadish, if you would not delay the
    deployment if IFT-14 fails, what basis would you have for claiming that
    the deployed system works, and are there any circumstances under which
    you would consider delaying the September deployment date of the
    ground-based midcourse system? If so, what are they?
        General Kadish. The basis for confidence in the system to serve as
    an initial defensive capability is its demonstrated performance in
    ground and flight testing throughout the development test program and
    extensive modeling and simulation. In the event that we do not achieve
    an intercept during IFT-14, we will evaluate the cause, assess the
    impact of the failure within the context of the wealth of other
    indicators of system performance, and make the appropriate
    recommendation to the DOD.
                                     ______

               Questions Submitted by Senator Joseph I. Lieberman
                      testing, training, and certification
        66. Senator Lieberman. General Kadish, I have remained a strong
    supporter of missile defense throughout my tenure in the U.S. Senate. I
    was a co-sponsor of the Missile Defense Act of 1999 and last year I
    supported funding for the initial 20 interceptors, in order to develop
    an initial defense against a limited ICBM attack. I was encouraged to
    hear last year that one of the primary purposes of procuring the
    initial 20 interceptors was to conduct robust testing. This year,
    however, I am concerned by the MDA's pronounced lack of recent testing
    since we have now gone 15 full months without an IFT. I am also
    troubled by the lack of any plans for realistic operational testing in
    the near-term; and by the MDA's desire to buy an additional 10-20
    interceptors without first determining whether the previous 20 will
    really work. Why is the MDA not focusing its resources on operational
    testing before you buy more interceptors, a weapon that at this point
    may or may not be capable of actually destroying an inbound ballistic
    missile?
        General Kadish. The DOD is proceeding to field an initial defensive
    capability as directed by the President and in accordance with the NMD
    Act of 1999. The performance of the BMDS in the developmental test
    program shows that we have crossed the threshold of technologically
    possible, and, indeed, have reason for confidence that it will provide
    a meaningful capability. That initial capability will likely be
    limited, but will still represent a dramatic improvement over our
    current condition of being defenseless against ballistic missile
    attack. As additional components of our initial configuration are
    placed in service in 2004 and 2005, the effectiveness of the missile
    defense capability will incrementally improve.
        In the last 15 months, MDA has successfully conducted BV-5 and BV-6
    test events to verify design, integration, and assembly process and
    performance of the Lockheed Martin (LM) Booster Vehicle Plus (BV+) and
    Orbital Science boost vehicle (OBV). IFT-13B was conducted and
    successfully demonstrated GMD system integration, interfaces, and
    performance as well as demonstrated the ability of the missile to
    support future hit-to-kill flight tests. These flight tests, although
    not intercepts, are a critical step in the development test programs
    towards future hit-to-kill flight tests. In addition, FM-6 was
    conducted and successfully intercepted a Short Range Ballistic Missile
    by an SM-3 from an Aegis ship.
        The limited defensive capability that we can put on alert in late
    2004 does not represent the BMDS at maturity. With the test bed in
    place we will be able to conduct flight testing of the on-alert
    configuration with increasing levels of operational realism. These more
    realistic tests, involving warfighters and alert-configured hardware
    and software, will validate the models and simulations that give us the
    confidence we have in system performance.

        67. Senator Lieberman. Admiral Ellis, as the Commander of STRATCOM,
    your organization will have the daunting responsibility of protecting
    our Nation from a missile attack. What are your views on fielding a
    system that has not undergone operational testing?
        Admiral Ellis. We understand where we are in terms of system
    maturity. We understand the elements of the systems that have been
    tested--boosters, kill vehicles, command and control networks, and
    radars--and we understand how they are being brought together for this
    IDO capability. We will have, in this developmental test bed, a
    rudimentary capability when the last of these elements is put into
    place to create this system sometime later this year. Use of this
    nascent capability as its development continues is both possible and
    prudent.

        68. Senator Lieberman. Mr. Christie, in your most recent report to
    Congress, submitted in January of this year, you state that, ``At this
    point in time, it is not clear what mission capability will be
    demonstrated prior to the Initial Defense Operations [which is the
    deployment of the NMD system in September]''. Could you please explain
    why you cannot, at this point, assess the capability of this system,
    and tell me when you might be able to?
        Mr. Christie. At this time, we do not have an integrated
    operational system to evaluate. Evidence from developmental testing of
    components and subsystems suggests there should be inherent capability
    in the IDO architecture. But, as evidenced by the delays in the flight
    test and ground test schedules, the MDA is still finding and fixing
    problems with hardware and software as they complete the IDO
    infrastructure. We may not have much integrated system performance data
    to demonstrate what that capability is prior to a 2004 deployment. Data
    opportunities begin immediately with IFT-13C. The opportunities to
    demonstrate and evaluate the systems mission capability will increase
    significantly with the deployment of the IDO test bed to support
    testing.

        69. Senator Lieberman. General Dodgen, please explain to me the
    extent of training, testing, and certification used to prepare the
    soldiers who will operate the Fort Greeley interceptor site, beginning
    this September, and act as the Nation's first line of defense against a
    ballistic missile attack on the U.S.
        General Dodgen. The training, testing, and certification process of
    these soldiers has been nearly continuous, with mastery of the system
    being the only acceptable standard. First, the Air Defense Artillery
    School at Fort Bliss, Texas qualifies soldiers/operators in a Military
    Occupation Skill (MOS). This schooling will last from 13 weeks to 6
    months or more, depending on occupation.
        Once Air Defense MOS qualified, soldiers enter a rigorous
    individual training program conducted by the MDA Ground-Based Midcourse
    Defense Joint Program Office. Here each soldier undergoes an initial 4-
    week ``Basic'' course followed by a 6-week ``Advanced'' course
    requiring system mastery for completion. The training covers
    operational theory, functional interoperability of architectural
    components and system elements, utilizing classroom and hands-on
    experiences.
        Soldiers are then assigned to crews within their unit where they
    undergo 6 more weeks of intense positional and crew training. During
    this meticulous instruction they are taught and become expert at there
    specific individual and crew tasks, tactics, techniques, and
    procedures.
        Upon completion of this training, soldiers begin operational
    procedures investigations at the Joint National Integration Center
    (JNIC) in Colorado Springs, where these expert soldiers and crews
    perfect their skills in a joint environment with NORTHCOM/North
    American Aerospace Defense (NORAD) command center crews from Cheyenne
    Mountain. A soldier will experience no less than 6 months, and
    depending on occupation, as much as a full year of specialized,
    dedicated, hands on instruction, training, and examinations before they
    can even be qualified to undertake an operational readiness evaluation
    (ORE). Successful completion of this ORE would result in an achievement
    of only the first tier of a strict multi-tiered certification process
    that includes individual, crew, unit, and combatant commander
    certification.
        The Army is utilizing a trained group of subject matter experts
    (soldiers, Government civilians, and contractors) to conduct OREs of
    the crews optimizing every possible event (Exercises, Wargames,
    Simulations, Integrated Flight and Ground Tests (IFT/IGT), and System
    Integration and Check-out (SICO) tests) to ensure we have the soldiers
    trained and certified to defend the Nation with this Strategic Missile
    Defense capability when it becomes operational.

                            ballistic missile threat
        70. Senator Lieberman. General Kadish, a recent Washington Post
    article dated February 17, 2004, carried an announcement by Russian
    President Vladimir Putin that his forces had just successfully tested
    what he called a ``maneuver re-entry vehicle.'' The article later
    discusses the Russians' desire, following our departure from the 1972
    ABM Treaty, to equip its state-of-the-art Topol missile with multiple
    warheads. According to DOD officials, either of these technologies
    would be very difficult for our missile defense system to defeat. I
    realize that our NMD system was not envisioned to defeat a large-scale
    attack from nuclear powers such as Russia or China. However, with the
    recent discoveries of the proliferation of nuclear and missile
    technologies to such states as Iran, North Korea, and Libya I am
    concerned that in the near future a single high-technology missile
    launched by a State or organization may have the capability to defeat
    our defenses. What are the MDA's plans to deal with future threats such
    as these?
        General Kadish. The MDA continues to pursue technologies and
    capabilities to address adversary missiles of all ranges, in all phases
    of flight and in all regions. I will answer the question in two parts--
    first our plans to defeat maneuvering re-entry vehicles and second
    relative to multiple warheads. [Deleted.]

        71. Senator Lieberman. Mr. Wynne, this year's budget request for
    missile defense is substantial. I recognize the necessity to maintain
    momentum on research, development, and testing of these extremely
    technologically complex systems, however, a ballistic missile attack
    poses just one potential threat against the citizens of the United
    States. Each year Congress must assess the level of defense spending in
    order to determine that the country is investing the necessary funds on
    the correct technologies required to protect our citizens against the
    most likely threats to our Nation. Are you aware of a process within
    the DOD, or within the administration as a whole, that assesses the
    spectrum of probable threats against our Nation and factors the
    likelihood of these threats into determining which systems are funded
    (and to what level they are funded) in the annual budget request? Based
    on your knowledge, why does the administration believe that there is
    enough of a near-term threat from a ballistic missile attack on the
    U.S. to warrant fielding an interceptor system before operational
    testing has been accomplished?
        Mr. Wynne. There are several such processes within the executive
    branch. The President's NSS sets strategic priorities which guide the
    Quadrennial Defense Review (QDR), the Nuclear Posture Review (NPR), and
    the National Military Strategy (NMS). These sources of guidance inform
    the Department's ongoing assessments of the varied threats to the
    Nation, our allies, and our deployed forces. The Joint Capabilities
    Integration and Development System (JCIDS) processes support the
    Chairman of the Joint Chiefs of Staff and the Joint Requirements
    Oversight Council (JROC) in identifying, assessing, and prioritizing
    joint military capability needs. Implementation of direction in the NPR
    has prompted assessments of the DOD's priorities for strategic defense.
    These and other ongoing assessments produce fiscal and programming
    guidance that set budget priorities. The budget is scrutinized by the
    OMB before submission to Congress to ensure that funding priorities are
    consistent with Presidential direction and administration policy.
        As the events of September 11 demonstrated, the security
    environment is more complex and less predictable than in the past. We
    face growing threats from WMD in the hands of states or non-state
    actors, threats that range from terrorism to ballistic missiles
    intended to intimidate and coerce us by holding our cities hostage to
    WMD attack. Hostile states, including those that sponsor terrorism, are
    investing significant resources to develop and acquire ballistic
    missiles of increasing range and sophistication that could be used
    against the United States and our friends and allies. These same states
    have chemical, biological, and/or nuclear weapons programs. In fact,
    one of the factors that make long-range ballistic missiles attractive
    as a delivery vehicle for WMD is that the United States and our allies
    lack effective defenses against this threat. This rationale underpins
    the NMD Act of 1999 which established the policy of the United States
    to deploy as soon as technologically possible an effective NMD system
    capable of defending the territory of the United States against limited
    ballistic missile attack. The BMDS developmental test program has
    demonstrated that the inherent capability of the architecture for IDO
    may allow us to defend against limited ballistic missile attack. We
    will continue to characterize that capability and improve upon it as
    the system matures. In addition, our resolve to develop defenses
    against ballistic missiles may also deter hostile states from investing
    resources to acquire them, reducing the global threat.

                     requirements for a viable radar system
        72. Senator Lieberman. General Kadish, in order for a NMD to be
    effective, it is necessary to be able to locate and identify potential
    inbound threats. According to officials in the MDA, an XBR system is
    essential to any missile intercept program. At this time, however,
    there is no funding slated for the construction of a ground-based XBR,
    which will ideally be located in Shemya, Alaska. Instead, funding is
    being used to develop the SBX. However, the SBX will not be fielded
    until 2005 and, according to a 2002 statement by the Director of the
    MDA, ``the SBX is not a substitute for a Shemya XBR.'' Until SBX is
    fielded, the interceptor system will utilize the Cobra Dane
    surveillance radar system. According to a GAO report recently released,
    the Cobra Dane radar has never been tested for this missile intercept
    utility and even with new software upgrade, it will lack the ability to
    provide more than rudimentary analysis of incoming missile threats.
    When the SBX is eventually fielded, it will be limited to either
    providing operational support in Alaska, or support to the current test
    range in the Hawaiian Islands, not both. Based on these facts, I
    contend that there is a capabilities gap in our near-term NMD sensor
    architecture. You have previously testified before Congress that
    building an XBR at Shemya in the Aleutians was the ``long pole in the
    tent,'' meaning that it was on the critical path to establishing a
    viable missile defense system. Yet the administration has never
    requested funds to build an XBR at Shemya, and has decided on SBX
    system instead. Why have you not requested funds for this ground based
    radar?
        General Kadish. The SBX was the result of changes in the GMD
    mission and program focus in 2002 and the U.S. withdrawal from the ABM
    Treaty.
        Prior to 2001, a land-based XBR was planned for Shemya Island,
    Alaska. From that location, an XBR would provide ballistic missile
    acquisition, tracking, discrimination, and kill assessment for the
    United States. In July 2001, the GMD Joint Program Office changed its
    near-term mission from deployment of a missile defense capability
    covering the U.S. to a robust test architecture in the Pacific that
    would also provide some limited operational utility.
        As the test bed was laid out in 2001, it was discovered that many
    threat representative trajectories could not be supported by a Shemya-
    based XBR. This necessitated exploration of additional radar sites and
    concepts. As a result, the SBX concept was developed. SBX will provide
    the capability to support identified test bed flight test missions and
    will be a mobile asset that allows operational capability. This
    mobility was not allowed under the ABM Treaty.
        It is important to note that either an SBX or a land-based Shemya
    XBR could provide a high degree of ballistic missile sensor capability.
    The major difference is the actual mission that each performs. The
    Shemya radar would have been affixed operational asset providing robust
    missile defense capability but was not located to support the test
    architecture. The SBX offers a movable sensor that maximizes the test
    bed's utility, which will ultimately result in a more flexible
    operational missile defense system.
        The SBX is scheduled to be integrated into the BMDS at the end of
    fiscal year 2005.

        73. Senator Lieberman. General Kadish, when the SBX is
    participating in a test, will it be capable of being used to defend
    against a real missile attack? If not, will you be relying on Cobra
    Dane to provide radar coverage during these test windows? When, if it
    all, do you plan to test the Cobra Dane radar system to assess its
    ability to function as a missile tracking and target acquisition radar?
        General Kadish. Yes, the SBX can fill its defensive role while
    testing. The SBX, like other BMDS components, is subject to recall for
    defensive operations whether it is participating in a flight or ground
    test, undergoing routine maintenance, in transit, or in any other
    status.
        Cobra Dane and SBX will complement each other after the sea-based
    radar is added to the BMDS at the end of calendar year 2005.
        Due to Cobra Dane's location and orientation, the only way to test
    the radar would involve flying an air-launched target through its field
    of view. MDA is currently examining the best approach to conducting
    Cobra Dane radar testing.
                                     ______

                 Questions Submitted by Senator Daniel K. Akaka
                                 airborne laser
        74. Senator Akaka. General Kadish, I understand from GAO that the
    current ABL contract is supposed to reach its cost ceiling by May 2004.
    Because MDA does not know how to estimate the total cost of this
    program nor when it will reach program completion, MDA has decided to
    go to a year-to-year contract. How can you justify asking for funding
    for a program when you seem to have no idea how much will be expended
    on that program from year-to-year?
        General Kadish.

        a. Estimating the costs for a technology program is a challenge
    that is not unique to ABL. As recognized by the GAO, estimating the
    cost of development for programs similar to ABL's technology maturity
    level cannot be done with total accuracy. However, that alone does not
    make the effort unjustifiable. Furthermore, prudent cost control steps
    are being taken. We regularly evaluate and adjust our cost estimates,
    based on past experience and an assessment of the scope of the
    remaining effort, in order to provide the best picture of the annual
    funding requirement.
        b. Our justification in continuing to request funding is based on
    the fact that ABL will provide an essential, strategic military
    capability, as noted above. Our cautious program management approach
    recognizes the technical complexity of ABL's development and we set
    near-term programmatic goals to be met, in order to estimate cost. This
    strategy includes continuation reviews to better understand program
    technical progress and system viability. All this is taken into
    consideration as the MDA updates the ABL program costs and subsequently
    requests funding.

        75. Senator Akaka. General Kadish, how do you plan to ensure
    financial accountability for this program over its acquisition cycle?
        General Kadish. The MDA has instituted a number of financial review
    processes for all of its elements to ensure financial accountability
    and ABL is no exception. We plan to continue to apply prudent financial
    management principles in managing the program. It should be noted that
    by continuing to run the ABL program with the same financial rigor as
    any of MDA's major acquisition efforts, we actually ensure it receives
    a higher level of oversight than it would ever receive as a technology
    development program.

        76. Senator Akaka. General Kadish, in January 2001, the ABL Program
    Manager stated that there are ``no showstoppers and [the program] has
    met or exceeded every technical requirement.'' Is that statement still
    true of the ABL system?
        General Kadish. The ABL still has not encountered any technical
    showstopper. Though we have had many technical challenges to date, they
    have all been overcome and we see nothing to prevent accomplishment of
    a successful system demonstration.

        77. Senator Akaka. General Kadish, there are expected to be four
    lasers onboard the ABL: the Active Ranging System (ARS) that locates a
    target missile; the Target Illuminator Laser (TILL); a Beacon
    Illuminator Laser (BILL); and finally the Killer Laser. In 2001, it was
    projected that these four lasers would be operationally ready in April
    2002. What is the current status of each of these lasers? Are they all
    ready to be operationally tested?
        General Kadish.

        a. The following is a summary of the current status of each laser.

              i. First light for first the high-energy laser module was
            successfully tested in fall 2001, providing 118 percent of
            design power. First light for the 6-module high-energy laser is
            projected to be accomplished by the end of calendar year 2004.
              ii. As for the illuminator lasers, the BILL and the TILL have
            been extensively tested in laboratory and end-to-end testing.
            The total run times on these lasers, from typically 30-second
            test runs, far exceed what we expect to be seen in the
            aircraft.
              iii. The ARS laser has accumulated nearly 100 ills of run
            time in ground testing and has been operated for at least 4
            hrs. continuously.

        b. Integration and development testing of the all lasers onboard
    the ABL aircraft will begin at Edwards Air Force Base, California, in
    2005.

        78. Senator Akaka. General Kadish, are the problems in the ABL
    system engineering problems, physics problems, or both?
        General Kadish. At this point there are no technical showstoppers
    to the ABL program. Integration challenges center around implementing
    pioneering technology, completing first-of-a-kind component
    manufacturing, and developing first-ever engineering and operating
    procedures for a directed energy weapon. To date, the program has not
    encountered any insurmountable challenge. Many integration challenges
    have been met and overcome, including several previously viewed as
    unsolvable. Therefore, we see nothing to prevent accomplishment of a
    successful system demonstration.

        79. Senator Akaka. General Kadish, in April 2003, before Senate
    appropriators, you indicated that the cost of the ABL program could run
    15 percent to 20 percent above projections and stated that the MDA is
    ``right on the edge'' of proving that the technology can work. Have
    your projections of cost overruns changed in a year?
        General Kadish. Yes, our projections have changed, and our previous
    estimates have been adjusted upwards. Based on an increased
    understanding of the complexities involved in integrating the system
    and using our experience on the progress we have made to date, we have
    a better understanding of the challenges that lie ahead.

                                testing concerns
        80. Senator Akaka. General Kadish, regarding the BMDS, the fiscal
    year 2003 Christie Report states: ``Due to the immature nature of the
    systems they emulate, models and simulations of the BMDS cannot be
    adequately validated at this time. Confidence in assessed capabilities
    will improve as more system performance data is gathered to anchor the
    simulations or directly demonstrate these capabilities.'' Why is the
    DOD deploying a system when its capabilities cannot be adequately
    evaluated at this time?
        General Kadish. The models and simulations have given the MDA the
    confidence to put these systems into the field to gain further
    operational experience. The DOD is fielding these systems as they
    become available to give the warfighter a capability where none
    previously existed and to gain experience in their use. The
    capabilities at any point in time will be adequately evaluated for use
    within stated limitations and conditions. The alternative would be not
    to provide any capability to protect the U.S. and its allies.

        81. Senator Akaka. General Kadish, concerns have been reported
    regarding the lack of real-world scenarios in which the BMDS has been
    tested. For example, the tests used to evaluate the ABL program used a
    laser that is fundamentally different from the type of laser that will
    be in the final ABL. I am concerned we will have no true measure of the
    capabilities of these systems before we launch them. Can you discuss
    the rationale for not testing the BMDS in real-world conditions?
        General Kadish. The MDA has always planned to test its systems in
    realistic operational situations. However, real world scenarios may not
    be possible, in all situations, for the BMDS. Individual elements of
    the BMDS, like the ABL, will be tested within the limits of the test
    ranges to collect developmental data and where possible, using
    operationally relevant conditions. Multiple test scenarios will be used
    to characterize the performance of integrated elements; validated
    models and simulations will be used to verify the full range of
    capabilities for each phase of the BMDS.
        The DOD is fielding these systems as they become available to give
    the warfighter a capability where none previously existed and to gain
    experience in their use. The capabilities at any point in time will be
    adequately evaluated for use within stated limitations and conditions.
    The alternative would be not to provide any capability to protect the
    U.S. and its allies.

                               spiral development
        82. Senator Akaka. Secretary Wynne, the National Defense
    Authorization Act for Fiscal Year 2003 states that once an acquisition
    program is designated as employing ``spiral development,'' the
    Secretary of Defense must submit an annual status report on that
    program, which includes projected prototype costs, to Congress. No such
    reports have been submitted on the BMDS. The term ``spiral
    development'' is used in MDA's budget request to explain the BMDS
    development process. It has also been used repeatedly by multiple
    senior officials in the DOD and the MDA in reference to missile
    defense. Yet according to a 2003 GAO report, none of the missile
    defense programs have been officially designated as spiral development
    programs. Can you explain this apparent lack of consistency? Are
    missile defense programs using spiral development? If so, why have the
    required reports not been submitted to Congress?
        Mr. Wynne. The BMDS was identified as using spiral development
    after the reporting deadline of September 30, 2003. It will be included
    in the Department status report due by September 30, 2004.

        [Whereupon, at 12:45 p.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                            TUESDAY, MARCH 23, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

          ATOMIC ENERGY DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY

        The committee met, pursuant to notice, at 9:43 a.m., in
    room SD-106, Dirksen Senate Office Building, Senator John
    Warner (chairman) presiding.
        Committee members present: Senators Warner, Allard,
    Sessions, Levin, Kennedy, Reed, Bill Nelson, Clinton, and
    Pryor.
        Committee staff member present: Judith A. Ansley, staff
    director.
        Majority staff members present: L. David Cherington,
    counsel; and Lynn F. Rusten, professional staff member.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; and Madelyn R. Creedon, minority
    counsel.
        Staff assistants present: Michael N. Berger, Bridget E.
    Ward, Nicholas W. West, and Pendred K. Wilson.
        Committee members' assistants present: Jayson Roehl,
    assistant to Senator Allard; Mieke Y. Eoyang and Jarret A.
    Wright, assistants to Senator Kennedy; Elizabeth King,
    assistant to Senator Reed; William K. Sutey and Dan Shapiro,
    assistants to Senator Bill Nelson; Andrew Shapiro, assistant to
    Senator Clinton; and Terri Glaze, assistant to Senator Pryor.

           OPENING STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner. Good morning, everyone. The committee
    meets this morning to receive testimony from the Secretary of
    Energy, the Honorable Spencer Abraham, on the defense-related
    activities of the Department of Energy (DOE), as well as the
    President's Defense Authorization Request for Fiscal Year 2005
    and the Future Years Defense Program (FYDP). The committee
    welcomes our distinguished witness, together with his
    colleagues who have joined him this morning.
        This committee has jurisdiction over approximately two-
    thirds of the DOE's budget. The fiscal year 2005 budget request
    for the defense-related missions of DOE is approximately $16.8
    billion, a 2-percent real increase over the fiscal year 2004
    appropriated level. This funding is primarily for maintaining
    the reliability, safety, and security of our nuclear weapons
    stockpile and for the environmental cleanup of Department of
    Energy (DOE) nuclear facilities.
        For the past 2 years, DOE has requested funding or
    legislation for several research programs which I think are
    vital for America's defense posture. This includes a
    feasibility study on the Robust Nuclear Earth Penetrator (RNEP)
    and advanced concepts research. These important requests
    generated significant, and I must say, I think quite
    appropriate, debate in Congress both last year and the previous
    year.
        Last year Congress decided to authorize research and
    feasibility studies on advanced concepts and the RNEP while
    ensuring that Congress has the final say on whether more
    advanced development activities may proceed in the future.
    Specifically, the National Defense Authorization Act for Fiscal
    Year 2005 puts in what I believe is a very appropriate
    condition, namely that before the DOE can proceed to the
    engineering development, production, or deployment phases of
    the RNEP, or a low-yield nuclear weapon, Congress must
    specifically give the authorizations. This is a prudent way to
    handle a very sensitive issue, which is concerning the public a
    great deal. I think that is understandable, and it is an issue
    that is deserving of very careful oversight in the years to
    come by Congress.
        Congress struck the proper balance, which will allow our
    weapons scientists, engineers, and technicians to conduct
    necessary research studies to ensure that they can maintain the
    technical ability to respond to any future military
    requirements as determined by this and future Presidents.
        There are several other DOE matters which require this
    committee's ongoing oversight. The Science-Based Stockpile
    Stewardship Program continues towards a goal of ensuring that
    the United States can maintain its nuclear weapons stockpile
    and that the stockpile can be certified as reliable, safe, and
    secure without the need to conduct underground live nuclear
    tests. I think it is a laudable goal, but I am speaking just
    for myself that I have a considerable skepticism as to whether
    this goal can be achieved.
        Three major DOE programs are critical to DOE's defense-
    related mission: the National Ignition Facility (NIF), the
    Modern Pit Facility (MPF), and the Mixed Oxide (MOX) Facility,
    and I hope, Mr. Secretary, you will include references to each
    today.
        As the environmental management (EM) program works toward
    the completion of the first three major closure sites in 2006,
    there are reasons to both praise these accomplishments and at
    the same time urge caution as the new challenges emerge. The
    planned 2006 closure of the Rocky Flats site in Colorado and
    the Fernald and Mound sites in Ohio, I think, is positive news
    for the DOE. The early closure of these sites is expected to
    result in a cost savings of over $12 billion.
        Nonetheless, shifting the oversight of the closure sites
    from the EM program to the Office of Legacy Management (LM)
    poses a new challenge for the DOE. Environmental stewardship
    responsibilities, pension and health care needs, and the
    community concerns will all require a high level of attention
    to assure a smooth transition.
        Consequently, Secretary Abraham, I know that you share the
    President's priority on nuclear nonproliferation matters and
    that you take a deep personal interest in your department's
    very active role in this area. We look forward to hearing from
    you this morning about these programs. I thank you and your
    family for service to the Nation and that of your colleagues. I
    now turn to the distinguished ranking member, Mr. Levin.

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman. First, let me join
    you in welcoming Secretary Abraham back. It's always good to
    have our friend and former colleague here with us. The DOE's
    total budget request for fiscal year 2005, as you have pointed
    out, Mr. Chairman, is $23.5 billion of which $16.8 billion, or
    about two-thirds of the overall DOE budget is for defense-
    related activities, and thus under the jurisdiction of this
    committee. These defense-related activities include the
    environmental cleanup program, the nuclear nonproliferation
    programs, the nuclear weapons activities, and the naval
    reactors development program. The National Nuclear Security
    Administration (NNSA) is responsible for the nonproliferation
    programs, the nuclear weapons program, and the naval reactors
    program.
        The DOE NNSA has made some progress in its various
    nonproliferation programs, and I want to commend you, Secretary
    Abraham, for your efforts with Russia and the International
    Atomic Energy Agency (IAEA) to establish a task force to
    identify, assess the risk of, and secure or destroy as
    appropriate radiologic devices and other nuclear and
    radiological materials that could possibly be used in a
    radiological dispersal device (RDD), a so-called dirty bomb.
        In addition, the DOE has taken over responsibility from the
    DOD for a major project to shut down the last three plutonium
    producing reactors in Russia. To enable the shut-down of these
    reactors, which also produce energy for their local
    communities, DOE must build or modify fossil fuel plants to
    provide the energy that will be lost when the reactors are shut
    down. This will be a challenging program, and we look forward
    to working with you, Mr. Secretary, to make this program a
    success.
        One problem that is facing the DOE in the nonproliferation
    area is the stalemate between the United States and Russia on
    the issue of liability. The failure to resolve these
    differences has caused several nonproliferation programs,
    including the DOE program to convert 34 tons of weapons-grade
    plutonium to fuel for nuclear power reactors, to essentially
    shut down. Secretary Abraham, I would very much appreciate your
    thoughts on how that matter could be resolved.
        On nuclear weapons, working to secure nuclear materials and
    weapons is just one aspect of proliferation. Over the course of
    the past 3 years, the administration has taken a variety of
    steps that would indicate more emphasis and importance is being
    placed on nuclear weapons than on nonproliferation. Nuclear
    proliferation and the nuclear weapons policies and actions of
    the United States are inextricably connected, and we should be
    conscious of that interaction.
        The message sent by last year's repeal of the ban on
    research and development (R&D) of low-yield nuclear weapons is
    the wrong message. Other aspects of last year's actions begin
    to take the United States in a dangerous new direction that
    marks a major shift in American policy, is inconsistent with
    our longstanding commitment under the Nuclear Nonproliferation
    Treaty (NPT) to end the nuclear arms race, and undermines our
    argument to other countries around the world that they should
    not develop or test nuclear weapons.
        The United States, as the only country to use nuclear
    weapons, has a responsibility to ensure that nuclear weapons
    are never seen as just another option for warfare. The Bush
    administration, through a series of acts taken over the past 3
    years, is moving to change the traditional thinking about
    nuclear weapons to make nuclear weapons more useable and to see
    them as just another capability. Four years after promising to
    reduce reliance on nuclear weapons and to reduce the number of
    nuclear weapons in the stockpile, the United States is still
    maintaining and supporting a Strategic Arms Reduction Treaty 1
    (START 1) stockpile on the order of 8,000 weapons. There have
    been no reductions in the number of weapons in the stockpile,
    and it appears that reliance on nuclear weapons as a
    warfighting option may actually have increased.
        The DOE budget request for fiscal year 2005 would more than
    double the money provided last year to continue work on the
    RNEP and also increase by 50 percent the money for advanced
    nuclear weapons concepts. At a time when the United States is
    trying to dissuade other countries from going forward with
    nuclear weapons development, and when we are spending over $1
    billion to prevent the spread of nuclear weapons material and
    technology, these actions send a terrible message. The United
    States is following a policy that we urge others not to adopt.
        Secretary Abraham, I look forward to discussing these
    important issues with you, and again, we welcome you as always
    back to the Senate.
        Chairman Warner. Mr. Secretary, we will put into today's
    record your statement in its entirety, and perhaps you can in
    your opening remarks give us an overview and we'll proceed into
    the question period.

         STATEMENT OF HON. SPENCER ABRAHAM, SECRETARY OF ENERGY

        Secretary Abraham. Mr. Chairman, thank you very much, and I
    will try to give a brief summary of our written statement,
    which I appreciate having inserted into the record of today's
    hearing. I want to thank you and the other members. It is
    always for me, of course, an honor to have a chance to return
    to the Senate and meet with former colleagues and have a chance
    to talk about the DOE.
        Let me just begin today by commenting that at the level of
    funding we are proposing for the DOE in the 2005 budget, it
    constitutes the largest budget submission in the history of the
    Department. It reflects the success of a number of the programs
    which we have developed in recent years, as well as the
    President's confidence in the work that is going on, and really
    this budget request builds on a number of successes which we
    have achieved.
        I am very proud of what we have accomplished in the last
    several years in terms of providing for the national energy
    security and the economic security of the American people. I am
    especially proud, I want to just say today, of the performance
    of the men and women who work at the DOE and whose dedication
    and hard work make this possible. A testament really to that
    dedication and capability was a recent announcement by the
    Office of Management and Budget (OMB), which ranked the DOE
    first among Cabinet-level agencies in terms of the
    implementation of the President's Management Agenda. As I think
    everyone knows, OMB recently put together a scorecard which
    evaluates agency performance in a variety of areas such as
    financial management, and it recognized the DOE as the Cabinet-
    level agency which was leading the pack. As you might imagine,
    we are quite proud of this. Obviously it is the work of the
    folks on the front lines throughout our complex who have made
    this possible.
        Let me just comment on a few of the major areas of our
    budget as it relates to the work of this committee. Of the
    $24.3 billion total request for this year, 69 percent, or $16.8
    billion, is for the DOE's defense programs, which include the
    NNSA, our environmental cleanup activities, defense nuclear
    waste disposal, safeguards and security, as well as
    counterintelligence.
        NNSA, our quasi-independent agency, is charged with
    maintaining our Nation's nuclear stockpile, rebuilding the
    capabilities of our defense complex, halting the proliferation
    of nuclear weapons and materials, and providing the Navy with
    safe, militarily-effective nuclear propulsion. I think the NNSA
    has been very successful in meeting these responsibilities.
        Certifying to the President the safety and reliability of
    our stockpile is probably the most important responsibility a
    Secretary of Energy has, and in light of the moratorium on
    testing, this is a particularly difficult challenge. Through
    cutting-edge science and advanced computer modeling, NNSA is
    able to ensure that the weapons complex is ready and prepared
    to respond rapidly and effectively if required.
        In order to ensure the continued reliability of the
    stockpile, the DOE and NNSA have undertaken an ambitious
    campaign to modernize and rebuild the complex. This has been a
    central feature of every budget the Bush administration has
    submitted, and this year is no exception. That includes a large
    scale capital improvement program to rebuild decaying
    infrastructure as well as efforts to restore and improve the
    basic capabilities to operate our weapons programs in the 21st
    century.
        But as we are working to keep our stockpiles safe, secure,
    effective, and reliable, we are also taking steps to counter
    the proliferation of dangerous nuclear materials worldwide, and
    I am particularly proud of the role which the DOE has played in
    securing and removing dangerous nuclear materials from a
    variety of places, most recently from Libya.
        As the committee knows, in December, Colonel Qadhafi
    voluntarily pledged to disclose and dismantle all of Libya's
    weapons of mass destruction (WMD) programs, including a uranium
    enrichment project that could produce nuclear materials for
    several nuclear bombs per year. DOE experts were part of the
    team that did secure those materials and then brought them to
    our facility in Oak Ridge, Tennessee, for evaluation, testing,
    and destruction. The United States and the world are safer as a
    result of this nonproliferation triumph.
        I am also proud of the great progress which we have made
    with Russia on nonproliferation issues. We have accelerated the
    material protection programs and expanded the scope of our work
    to ensure that dangerous materials do not fall into the hands
    of terrorists. We have increased our cooperation with Russia's
    strategic rocket forces by initiating warhead security work at
    three new sites. We have also extended our international
    nuclear and radiological cleanout programs to states that were
    once part of the Soviet Union and its empire.
        Working with them, with Russia, and with the IAEA, we have
    been able to secure radiological materials in these countries
    before anyone with evil designs could get their hands on them.
    Moreover, we have begun a MegaPorts program to detect the
    trafficking of nuclear radioactive materials in the world's
    busiest seaports. Eventually we hope to have detection
    equipment in key locations all over the planet.
        On top of those responsibilities, the NNSA also receives
    the naval reactors program, which provides safe and reliable
    nuclear reactors to power the Navy's war ships. It is
    responsible for all naval nuclear propulsion work beginning
    with technological development through reactor operations, and
    ultimately to reactor plant disposal.
        Our 2005 budget continues to support our naval reactors
    efforts, including work on the design of the next generation of
    nuclear reactor for aircraft carriers and continued work on the
    transformational technology core to deliver a significant
    energy increase to future submarines.
        I think a review of all these programs should make very
    clear that we are dedicated to ensuring America's defense
    preparedness in the 21st century. We are also, Mr. Chairman,
    dedicated to cleaning up the legacy of half a century of
    nuclear defense work in the United States. On a complex-wide
    basis, we have taken an approach that says we will not allow
    the legacy of the work done in the weapons complex to be part
    of a community's burden for as far as the eye can see, and that
    is why we are seeking the most funding ever for our EM program.
        When we took office in 2001, the timetable for cleanup at
    most sites was 70 or 80 years. Today the measures which we are
    instituting and have instituted will accelerate completion of
    the cleanup program by 35 years, and because of the shorter
    time frame that's involved, it will save the American taxpayers
    as much as $50 billion, perhaps even more.
        The DOE's accelerated cleanup strategy has led to the
    creation, as you noted, of two new organizations outside of EM,
    the Office of Legacy Management, and the Office of Future
    Liabilities. Transferring responsibilities to these new offices
    will enable the EM program to complete its current cleanup
    scope, and it allows other departmental programs to focus on
    their primary missions.
        On a related note, we are seeking an increase in funding
    for our work to establish a permanent nuclear waste repository
    at Yucca Mountain. Yucca Mountain is key to helping us complete
    the cleanup of our Cold War weapons facilities. Our 2005 budget
    request permits us to stay on schedule to begin operation at
    Yucca Mountain in 2010.
        Finally, Mr. Chairman, safeguarding and securing all of
    DOE's sites and facilities is a top priority. I'm happy to
    report that the 2005 budget for all DOE safeguard and security
    programs fully addresses the requirements identified in the
    revised Design Basis Threat (DBT), the initiative we undertook
    to review all of our threat assessments and to update and
    modernize the complex to deal with the new world in which we
    live.
        At the same time, we are seeking to consolidate the two
    counterintelligence programs within the DOE into one office
    reporting directly to the Office of the Secretary. We reached
    this judgement after extensive review of the current separated
    or bifurcated counterintelligence functions between the DOE on
    the one hand and the NNSA, which have proven to be an
    impediment, frankly, to coherent and effective
    counterintelligence activities. We believe this must be
    corrected. I personally think that having a single
    counterintelligence office reporting directly to the Secretary
    of Energy will create a more streamlined and effective program,
    clarify accountability, and provide a clear line of authority
    for policy development and implementation.
        The NNSA Administrator, the National Counterintelligence
    Executive, the Director of Central Intelligence (DCI), and the
    Director of the Federal Bureau of Investigation (FBI), share
    this view as well. Recently, we submitted proposed legislation
    to Congress to effect the needed consolidation, and I would
    urge its prompt passage.
        Mr. Chairman, that concludes a brief overview of our major
    areas of responsibility, and obviously I would be happy to
    answer the committee's questions at this time.
        [The prepared statement of Secretary Abraham follows:]
                   Prepared Statement by Hon. Spencer Abraham
                                  introduction
        Good morning, Mr. Chairman and members of the committee. It is a
    pleasure to be here today to discuss the President's fiscal year 2005
    budget request for the Department of Energy (DOE). In doing so, I want
    to stress the ways this budget is going to help us accomplish our
    various missions related to defense and the environment.
        At $24.3 billion in gross budget authority, the fiscal year 2005
    budget request is the largest in the history of the DOE. Within the
    $24.3 billion, approximately 69 percent of the total DOE budget, or
    $16.8 billion, is for the Department's atomic energy defense activities
    within the jurisdiction of this committee. Within this part of the
    budget, there is $9.0 billion to support activities in the National
    Nuclear Security Administration (NNSA), $7.4 billion to fund the
    environmental cleanup activities, $131 million to fund the Defense
    Nuclear Waste Fund, and $663.6 million to fund other defense
    activities.
        This budget request builds on a number of successes we have had
    over the past 3 years. I am very proud of what we have accomplished in
    terms of fulfilling the President's management vision for this DOE and
    also what we have achieved to promote energy and economic security for
    the American people.
        The Office of Management and Budget (OMB) recently announced that
    DOE has made the most progress among Cabinet-level agencies in the
    implementation of the President's Management Agenda. OMB recognized DOE
    as the Cabinet-level agency ``leading the pack with regard to
    management improvement'' in the areas of human capital, competitive
    sourcing, financial management, e-government, and budget/performance
    integration.
        Over the past 3 years, with the strong support of the
    administration and Congress, our national nuclear security programs,
    through the DOE's NNSA, have achieved a level of stability that is
    required for accomplishing our long-term missions. As the post-Cold War
    era evolves, the NNSA is managing the Nation's nuclear warheads
    according to the guidance in the Nuclear Posture Review (NPR). The DOE,
    through the NNSA, works to ensure that the Nation's nuclear stockpile
    remains safe, secure, reliable, and ready, and to extend the life of
    that stockpile in support of Department of Defense (DOD) military
    requirements. Our Nation will continue to benefit from the security
    resulting from an effective nuclear deterrent and can be confident that
    the nuclear weapons complex is ready and prepared to respond rapidly
    and effectively if required.
        We have also made great progress in a number of other program
    areas. We have implemented changes that have fundamentally reformed
    DOE's Environmental Management (EM) program. Complex-wide, we have
    taken an approach to accelerated cleanup that says we will not allow
    the legacy of the work done in the weapons complex to be part of a
    community's burden for future generations. At the beginning of this
    administration, the timetable for completing cleanup at all sites was
    70 years. Today, we have implemented reforms to accelerate completion
    of the cleanup program by 35 years and reduce estimated program costs
    in excess of $50 billion.
        With national security as our overarching departmental mission, we
    cannot be said to be fulfilling our mission with any confidence unless
    we can guarantee security at our facilities. We are attempting to do
    that with a request of $1.38 billion in fiscal year 2005 for all DOE
    safeguards and security activities. We have revised the Design Basis
    Threat (DBT), which is the post-September 11 analysis of potential
    threats against which we must protect DOE sites and materials across
    the country, and are implementing our response to it. We also have a
    high-level review of security procedures underway by some of the
    Nation's top military and civilian experts. Lastly, we have made
    significant managerial changes in the security leadership at our
    facilities.
        A critical component of our national security mission is
    counterintelligence. Last summer, I informed this committee and others
    that our national security will be best served by consolidating the two
    counterintelligence programs within the DOE in one office reporting
    directly to the Office of the Secretary. I came to this conclusion
    after extensive review of the current bifurcated counterintelligence
    functions between the DOE and the NNSA, which have proven to be an
    impediment to coherent and effective counterintelligence activities.
    This must be corrected. More recently, I submitted proposed legislation
    to Congress to effect the needed consolidation.
        I believe that having a single counterintelligence office reporting
    directly to the Secretary of Energy will create a more streamlined and
    effective program, clarify accountability, and provide a clear line of
    authority for policy development and implementation. The NNSA
    Administrator, the National Counterintelligence Executive, the Director
    of Central Intelligence (DCI), and the Director, Federal Bureau of
    Investigation (FBI) share this view. I urge prompt passage of the
    legislation.
        The sections that follow provide the details of the fiscal year
    2005 budget request.
                    national nuclear security administration
        Representing approximately 37 percent of the DOE's entire fiscal
    year 2005 budget request, our national security programs have made
    great progress and continue to address the challenges of a post-
    September 11 environment.
        The fiscal year 2005 budget request totals $9.0 billion, an
    increase of $383 million or 4.4 percent. We are making progress in
    managing our program activities within a disciplined 5-year budget and
    planning envelope. We are doing it successfully enough to be able to
    address emerging new priorities and provide for needed funding
    increases in some of our programs within an overall modest growth
    rate--notably Safeguards and Security, Nuclear Weapons Incident
    Response, and Facilities and Infrastructure Recapitalization--by
    reallocating from other activities and projects that are concluded or
    winding down.
        The NNSA budget justification contains the required 3 years of
    budget and performance information, as well as similar information for
    5 years as required by Sec. 3253 of the NNSA Act, as amended (Title
    XXXII of the National Defense Authorization Act for Fiscal Year 2000,
    P.L. 106-65, 50 U.S.C. 2453). This section, entitled Future Years
    Nuclear Security Program (FYNSP), requires the NNSA to provide to
    Congress each year at the time the budget is submitted the estimated
    expenditures necessary to support the programs, projects, and
    activities of the NNSA for a 5 fiscal year period, in a level of detail
    comparable to that contained in the budget. Since the inception of
    NNSA, the FYNSP has been provided as a separate document supporting the
    budget request. Starting with this budget, NNSA will meet this
    statutory requirement by including outyear budget and performance
    information as part of a fully integrated budget submission.
    Weapons Activities
        The fiscal year 2005 budget request for the programs funded within
    the weapons activities appropriation is $6.568 billion, an increase of
    5.4 percent over fiscal year 2004 due largely to the increase in
    security and facilities infrastructure. Within weapons activities, the
    budget structure has been changed in response to congressional concerns
    to align directed stockpile work funding with individual weapon
    systems, and to highlight nuclear weapon incident response as a
    separate line.
        The NPR guidance directed that NNSA maintain a research and
    development (R&D) and manufacturing base that ensures the long-term
    effectiveness of the Nation's stockpile, and support the facilities and
    infrastructure that are responsive to new or emerging threats. The NPR
    also directed NNSA to begin a modest effort to examine concepts that
    could be deployed to further enhance the deterrent capabilities of the
    stockpile in response to the national security challenges of the 21st
    century.
        The United States is continuing work to refurbish and extend the
    life of the B61, W76, and W80 warheads in the stockpile. Within the
    fiscal year 2005 request of $1.4 billion for Directed Stockpile Work
    (DSW), funding for the life extension programs increases by 7 percent
    to $477.4 million. This reflects the expected ramp up in the three
    systems with First Production Units scheduled in fiscal years 2006-2009
    and the completion of life extension activities for the W87. In fiscal
    year 2005, DSW funding will support R&D of advanced weapon concepts to
    meet emerging DOD needs that will enhance the nuclear deterrent, and to
    ensure a robust and capable NNSA for the future. The NPR highlighted
    the importance of pursuing advanced concepts work to ensure that the
    weapons complex can provide nuclear deterrence for decades to come. In
    fiscal year 2005, $9.0 million is requested to support the modest R&D
    effort in the Advanced Concepts Initiatives (ACI) to meet emerging DOD
    needs and to train the next generation of nuclear weapons scientists
    and engineers. The Robust Nuclear Earth Penetrator (RNEP) is the most
    mature concept being studied in this program. Funds for the RNEP study
    are included in the fiscal year 2005 budget as a separate line item
    from the rest of the advanced concepts study activity. A request for
    $27.6 million is also included for the continuing RNEP feasibility,
    design definition and cost study. The RNEP study was requested by the
    Nuclear Weapons Council in January 2002.
        The RNEP study is to determine whether either of two existing
    warheads--the B61 or the B83--can be adapted without resuming nuclear
    testing to improve our ability to hold at risk hardened, deeply buried
    facilities that may be important to a future adversary. The request for
    advanced concepts funding is to investigate new ideas, not necessarily
    new weapons. For example, we are currently examining the feasibility of
    adapting an existing weapons carrier and existing nuclear warheads to
    achieve a delivery system with greater assurance that the intended
    nuclear mission could not be compromised by either component failure or
    adversary attack, thus giving greater reliability for nuclear missions.
    Appropriate uses for additional work in advanced concepts might include
    examining the feasibility of warheads with improved design margins,
    easier manufacturing, greater longevity, and improved safety. Any of
    these ideas would only be pursued for future development if directed to
    do so by the President and Congress.
        Progress in other parts of the Stockpile Stewardship Program
    continues. The fiscal year 2005 request for campaigns is $2.4 billion,
    essentially level with fiscal year 2004. This request funds a variety
    of campaigns, experimental facilities, and activities that continue to
    enhance NNSA's confidence in moving to ``science-based'' judgments for
    Stockpile Stewardship, and provide cutting edge technologies for
    stockpile certification and maintenance.
        While there is no reason to doubt the ability of the Stockpile
    Stewardship Program to continue to ensure the safety, security, and
    reliability of the nuclear deterrent, the Nation must maintain the
    ability to carry out a nuclear weapons test in the event of some
    currently unforeseen problems that cannot be resolved by other means.
    Within the guidance provided by Congress, we are beginning to improve
    our readiness posture from the current ability to test within 24 to 36
    months to an ability to test within approximately 18 months. The fiscal
    year 2005 budget request of $30 million supports achieving an 18-month
    readiness by September 2005. But let me be clear, there are no plans to
    test.
        The National Ignition Facility (NIF) at Lawrence Livermore National
    Laboratory (LLNL) remains on budget and schedule. The fiscal year 2005
    request of $130 million continues construction, installation, and
    commissioning of laser beams. Once complete in 2008, the 192-laser beam
    facility will be capable of achieving temperatures and pressures found
    only on the surface of the sun and in exploding nuclear weapons. We are
    anticipating the first Stockpile Stewardship experiments in 2004 using
    four laser beams. As a result of recent technical advances in capsule
    design, target fabrication, and computer simulations, we expect to
    begin the fusion ignition campaign in fiscal year 2009 with a goal of
    achieving fusion ignition in fiscal year 2010. The Advanced Simulation
    and Computing Campaign request for fiscal year 2005 is $741.3 million,
    an increase of nearly 3 percent over fiscal year 2004. Working with IBM
    and Cray Research, the program expects delivery of Red Storm in fiscal
    year 2004 and Purple in fiscal year 2005. These will be the world's
    fastest machines, operating at 40 and 100 Teraops, respectively, and
    they will continue to revolutionize supercomputer capabilities and
    three-dimensional modeling. Having these machines on-line will begin to
    redress the capacity and capability issues raised in the September 2003
    JASONs report required by Congress.
        The NPR recognized a need, over the long run, for a Modern Pit
    Facility (MPF) to support the pit manufacturing needs of the entire
    stockpile. NNSA's fiscal year 2005 request for the Pit Manufacturing
    Campaign is $336.5 million, an increase of 13 percent over fiscal year
    2004, but with some changes since the last budget request. We delayed
    the final environmental impact statement (EIS) for the MPF in order to
    address congressional concerns that it is premature to pursue further
    decisions on an MPF at this time. The decision to delay the final EIS
    also delays identification of a preferred site for constructing the
    MPF.
        This decision will in no way affect the W88 pit manufacturing and
    recertification program underway at Los Alamos, which is reestablishing
    the technological base to manufacture pits, and which thereby will
    inform many of the technology decisions, which will be contained in the
    eventual MPF design.
        Readiness campaigns are requested at $280.1 million in fiscal year
    2005, a decrease of about 14 percent. The decrease is attributable
    mainly to continuing progress in construction of the Tritium Extraction
    Facility that is funded within this account.
        NNSA's Readiness in Technical Base and Facilities activities
    operate and maintain current facilities and ensure the long-term
    vitality of the NNSA complex through a multi-year program of
    infrastructure construction. About $1.5 billion is requested for these
    efforts, a slight decrease from fiscal year 2004 that is attributable
    to a 20-percent decline in funding needed to support line-item
    construction project schedules.
        In fiscal year 2005 the President's budget provides a total of
    $201.3 million for the Office of Secure Transportation, which is
    responsible for meeting the DOE's transportation requirements for
    nuclear weapons, components, special nuclear materials, and waste
    shipments.
    Facilities and Infrastructure Recapitalization
        The Facilities and Infrastructure Recapitalization Program (FIRP)
    is essential to our ability to maintain a responsive robust
    infrastructure. I am pleased to note that its mission and performance
    are commended in the recent preliminary assessment by the National
    Research Council on DOE's facility management. The fiscal year 2005
    budget request for FIRP is $316.2 million. This increase follows a 2-
    year period of flat funding. The request restores the program to our
    previously requested FYNSP levels; it places the program back on our
    previously planned schedule and reflects our commitment to fulfill the
    direction of Congress to end the program by 2011.
    Nuclear Weapons Incident Response
        The third growth area in the fiscal year 2005 budget request is the
    Nuclear Weapons Incident Response programs. The fiscal year 2005
    request of $99.2 million reflects an increase of 11 percent over the
    fiscal year 2004 level, recognizing the greatly increased number of
    deployments of these assets within the United States and abroad. The
    long-term sizing of this effort in terms of dollars and people
    continues to evolve along with its critical role in homeland security.
    We have relocated this account separately within the weapons activities
    appropriation to provide additional visibility into these programs and
    funding request.
    Safeguards and Security/Design Basis Threat
        Protecting NNSA people, information, materials, and infrastructure
    from harm or compromise is one of our most serious responsibilities and
    highest priorities. The fiscal year 2005 budget request for NNSA's
    Safeguards and Security program is $706.9 million, an increase of 21
    percent over the fiscal year 2004 enacted level that is needed to
    implement our response to the new DBT at all NNSA sites and facilities.
    I issued the new DBT in May 2003, as a result of a post-September 11
    analysis of the threats against which we must protect DOE sites and
    materials across the country. Implementation plans based on
    vulnerability assessments for each of the sites are in final
    preparation. These will delineate the upgrades and associated costs
    plan to upgrade service weaponry, extend explosive impact zones,
    consolidate nuclear material, and make additional improvements of a
    classified nature to bring NNSA facilities into full compliance with
    the new DBT by the year 2006. The fiscal year 2005 NNSA budget includes
    $107.9 million ($89.6 in Safeguards and Security and $18.3 million in
    Secure Transportation Asset) to address the new DBT. NNSA will shortly
    submit a request for fiscal year 2004 reprogramming and appropriation
    transfer to allow this important work to continue on schedule. The
    fiscal year 2006 funding request for DBT implementation will be
    addressed during this spring's programming process, and accommodated
    within the current 5 year funding profile for NNSA.
        In recent months we have had some highly publicized occurrences at
    some NNSA sites. In each instance, NNSA and DOE have taken immediate
    and aggressive actions to address these occurrences and to ensure that
    any potential vulnerability is mitigated as soon as possible and that
    longer term fixes are put into place as appropriate. Because of these
    problems, we have chartered two external review groups to provide an
    independent assessment of our management of security. While we are
    confident that there has been no compromise of classified material and
    that no nuclear material is at risk, we believe security can and should
    be improved. Funding for Safeguards and Security in NNSA has increased
    over 70 percent during this administration, which is a strong indicator
    of the priority we place on this responsibility. The Administrator of
    NNSA and I join together in making it well known that we will not
    tolerate any reduction, perceived or real, in our protective forces and
    our abilities to protect the complex.
    Nuclear Nonproliferation
        We also continue to make great progress with Russia on nuclear
    nonproliferation. Of the $1.35 billion included in this budget for
    Defense Nuclear Nonproliferation, $999.0 million is requested for
    nonproliferation programs with Russia and other countries. We have
    accelerated the material protection programs and expanded the scope of
    our work to ensure that dangerous materials do not fall into the wrong
    hands. We have increased our cooperation with Russia's Strategic Rocket
    Forces by initiating warhead security work at three new sites.
        We have extended our International Radiological Threat Reduction
    program to states that were once part of the Former Soviet Union (FSU)
    and others. Working with them, with Russia, and with the International
    Atomic Energy Agency (IAEA), we have been able to secure radiological
    materials in these countries.
        Moreover, in this budget request we are continuing our MegaPorts
    program with $15.0 million to detect the trafficking of nuclear or
    radioactive materials in the world's busiest seaports. We will complete
    installations at three ports in fiscal year 2004 and complete an
    additional three ports in fiscal year 2005. Eventually we hope to have
    detection equipment in key locations all over the planet.
        The largest investment in nuclear nonproliferation in fiscal year
    2005 is the Fissile Materials Disposition program. We are working to
    design and build facilities to dispose of inventories of surplus U.S.
    weapons-grade plutonium and highly enriched uranium (HEU), and
    supporting concurrent efforts in Russia to obtain reciprocal
    disposition of similar materials.
        One of the major obstacles encountered this year is a disagreement
    with Russia regarding liability protection for plutonium disposition
    work performed in that country. This has resulted in a 10-month delay
    in the planned start of construction of the mixed oxide (MOX) facility
    in Russia as well as a similar facility in the United States. The
    liability issue is being worked at high levels in the administration.
    The President's fiscal year 2005 budget request seeks $649.0 million
    for this program to begin construction of both the U.S. and Russian MOX
    facilities in May 2005, as we work to resolve the liability issue by
    this spring. Our outyear funding profiles reflect the administration's
    full commitment for proceeding with plutonium disposition.
        Not only are we pursuing the disposition of weapons-grade
    plutonium, but we are also working hard to stop more from being
    produced. We have assumed the responsibility from the DOD for shutting
    down the last three plutonium production reactors in Russia and
    replacing them with fossil fuel plants by 2008 and 2011. This will
    result in the cessation of the annual production of 1.2 metric tons of
    weapons-grade plutonium. Under the Elimination of Weapons-Grade
    Plutonium Production program, we will provide oversight for Russian
    contractors who will actually be performing the work. The fiscal year
    2005 request for this effort is $50.1 million.
        In fiscal year 2005, NNSA assumes responsibility for the Off-site
    Source Recovery Project from the Office of EM. The requested program
    funding is $5.6 million, with a projected cost of about $40.0 million
    over the next 5 years to substantially reduce the risk of these source
    materials being used for radiological dispersion devices. The program
    works closely with the U.S. Nuclear Regulatory Commission (NRC) to
    prioritize source recovery.
        We are mindful of this committee's concerns about the finances of
    the programs funded by the defense nuclear nonproliferation
    appropriation. NNSA is currently developing the framework for the first
    semi-annual report on uncosted balances and commitments as directed by
    last year's authorization act.
    Naval Reactors
        In fiscal year 2005, we are requesting $798.0 million for the Naval
    Reactors program, an increase of about 5 percent. This program
    continues to be a prime example of how to manage unforgiving and
    complex technology. The Naval Reactors program provides safe and
    reliable nuclear reactors to power the Navy's warships. It is
    responsible for all naval nuclear propulsion work, beginning with
    technology development, through reactor operations, and ultimately to
    reactor plant disposal. The budget increase will support 70 percent
    completion of the design of the next generation nuclear reactor on an
    aircraft carrier, and continue work on the Tranformational Technology
    Core, which will deliver a significant energy increase to future
    submarines, resulting in greater operational ability and flexibility.
    The request includes $6.2 million for a new construction start, the
    Materials Development Facility Building, in Schenectady, New York. The
    total estimated cost of this facility is $20.4 million, and it is
    estimated to be completed in 2008.
    Office of the Administrator
        The NNSA is in the final implementation phase of a re-engineering
    effort that follows the principles of the President's Management Agenda
    to modernize, integrate, and streamline operations. As a result, at the
    end of fiscal year 2004, NNSA will achieve its goal of a 15-percent
    reduction in Federal personnel since fiscal year 2002.
        The fiscal year 2005 budget request of $333.7 million for the
    Office of the Administrator is about 1 percent below the fiscal year
    2004 appropriation. This reflects cost avoidance due to the reduction
    of about 300 positions since 2002, and no further request for
    incremental funding needed to accomplish re-engineering in NNSA
    headquarters and field organizations. The budget request assumes that
    personnel reductions are achieved, restructuring is finished, and
    associated employee transfers are completed at the end of fiscal year
    2004.
        The Defense Nuclear Nonproliferation and Nuclear Weapons Incident
    Response programs have been excluded from staff reductions due to
    increased program requirements in those areas. We are not requesting a
    separate funding control for the Office of Defense Nuclear
    Nonproliferation, because it is no longer necessary to assure that
    Federal hiring goals are met for those activities that are experiencing
    rapid mission growth. Based on hiring to date in fiscal year 2004, it
    is projected that this organization will meet or exceed its managed
    staffing plan goal of 244 by fiscal year 2005. A single funding control
    for the appropriation is necessary to facilitate NNSA's corporate
    efforts to rebalance the nuclear nonproliferation office's transition
    from reliance on support service contractors to permanent Federal
    staff.
                                  environment
    Environmental Management
        All of our scientific research is designed in part to meet our
    Nation's environmental challenges. In addition to research in hydrogen,
    next generation nuclear technology, and renewable energy, our
    commitment to the environment includes taking action to address the
    environmental legacy of our past work, particularly building the
    nuclear weapons complex that helped win the Cold War. That means
    cleaning up the contamination caused by the production of nuclear
    weapons and ensuring our Nation is equipped to safely handle future
    high-level nuclear waste generated by the use of conventional nuclear
    power as well as the continued stockpile stewardship of nuclear
    weapons.
        DOE is addressing these responsibilities through our EM program and
    the work at Yucca Mountain. Our fiscal year 2005 budget requests $8.6
    billion to meet our various environmental-related objectives. Within
    that, we are seeking over $7.4 billion for the EM program--the most
    funding ever requested for this program, reflecting the peak year of
    DOE's investment strategy for accelerated cleanup. We anticipate
    funding will then decline significantly to about $5 billion in 2008.
        The request includes five appropriations, three of which fund on-
    the-ground, core mission work, and two of which serve as support. The
    five appropriations and associated requested funding are as follows:

             Defense Site Acceleration Completion ($5.97 billion)
             Defense Environmental Services ($982 million)
             Non-Defense Site Acceleration ($152 million)
             Non-Defense Environmental Services ($291 million)
             Uranium Enrichment Decontamination and Decommissioning
            Fund ($500 million)

        Within the Defense Site Acceleration Completion appropriation,
    there is a proposal to reserve $350.0 million. These funds will be
    requested pending the satisfactory resolution associated with a recent
    court ruling dealing with our authority to classify certain lower
    activity waste incidental to reprocessing (WIR).
        This budget reflects several program shifts from EM to other
    programs within the DOE in fiscal year 2005. The program shifts more
    focus to EM's mission of Cold War cleanup and supports the EM program
    initiative to accelerate cleanup and risk reduction while providing the
    responsible and accountable mission programs with the resources and
    tools necessary to achieve their objectives. This accountability model
    is the key to moving each of the enterprises or missions of the DOE
    forward in attaining the desired outcomes and results important to the
    administration and supporting our accelerated risk reduction and
    closure initiative. Transfers include the following:

             Federal staff at the Pacific Northwest National
            Laboratory to the Office of Science and Federal staff at
            Headquarters to the Office of the Chief Information Officer;
             EM portion of the Offsite Source Recovery Program to
            the NNSA;
             Spent fuel storage responsibilities at Idaho National
            Laboratory, the Foreign Research Reactor Spent Fuel Program,
            management of NRC-licensed spent fuel, and the National Nuclear
            Spent Fuel Program to the Office of Civilian Radioactive Waste
            Management; and
             Formerly Utilized Sites Remedial Action Project
            records management, responsibility for cost liability and
            recovery reviews, and Environmental Justice and the Massie
            Chairs of Excellence Program to the Office of Legacy Management
            (LM).

        We will also be transferring sites, as they are completed, to
    either the landlord or to LM. Transferring sites to LM will occur if
    the site has no further DOE mission. EM is working with LM to ensure
    smooth site closure and transition by:

             Ensuring that site baselines identify functions and
            elements beyond contract closure to meet all internal
            requirements;
             Conducting assessments of site readiness for transfer
            and closure in tandem with LM;
             Having joint teams at each site (Rocky Flats has 2 LM
            employees) supported by LM personnel who were once EM personnel
            and EM personnel at sites are transferring to LM positions;
             Holding quarterly meetings between EM and LM senior
            management to address key issues and make decisions; and
             Developing a communication plan defining roles and
            responsibilities between EM and LM staff.

    Defense Nuclear Waste Disposal
        One of the most significant and long-standing commitments addressed
    in this budget is funding to establish a permanent nuclear waste
    repository at Yucca Mountain. In order to remain on schedule to begin
    operation in 2010, the fiscal year 2005 budget requests $880.0 million
    for Yucca Mountain repository activities, of which $131.0 million is
    requested from the Defense Nuclear Waste Disposal appropriation. This
    is key to ensuring the future use of nuclear power in this Nation. It
    is also important to help us complete the cleanup of our weapons
    facilities and consolidate high-level nuclear waste in one safe, secure
    location. This request enables us to finalize and defend the license
    application for construction of the permanent repository--which we are
    planning to submit to the NRC by December 2004--as well as other
    activities associated with repository design and safety upgrades and
    with developing a transportation system to the Yucca Mountain site.
        As I mentioned earlier, this budget reflects several program shifts
    from EM to other programs within the DOE. One of the shifts includes
    the transfer of the spent nuclear fuel management program from the
    Office of EM to the Office of Civilian Radioactive Waste Management.
    Transferring the responsibility for these activities will ensure a
    consistent policy and approach to manage and plan for the ultimate
    disposition of both commercial and DOE-owned spent fuel. The proposed
    transfer totals $26.4 million, with $21.2 million funded from the Other
    Defense Activities appropriation, and the remaining from the Energy
    Supply appropriation. These funds continue to remain separate from the
    Nuclear Waste Fund.
                            safeguards and security
        Safeguarding and securing DOE's sites and facilities are among our
    highest priorities. The fiscal year 2005 budget includes $1.38 billion
    for all DOE safeguards and security programs to address additional
    requirements identified as a result of the revised DBT.
        Within the total amount requested for safeguards and security
    activities, approximately $707 million will support activities to
    safeguard nuclear weapons facilities. About $265 million will support
    activities that protect the Cold War nuclear waste material being
    cleaned up at our environmental cleanup sites.
        We are also requesting $255.0 million for the Office of Security to
    support the development of DOE-wide security policies as well as to
    provide physical security for DOE headquarters. The fiscal year 2005
    budget request also includes $58.0 million to support safeguards and
    security activities at the new Idaho National Laboratory for nuclear
    energy R&D.
                             other defense programs
    Nuclear Energy
        The nuclear energy program remains a critical component of the
    Nation's energy portfolio and a significant part of America's energy
    future. The fiscal year 2005 budget request for the DOE's nuclear
    energy programs is $410.0 million, of which $112.8 million is for
    security and infrastructure activities at Idaho--a former DOD site--
    which falls under this committee's purview. These programs work to
    address essential requirements to develop advanced nuclear power
    technologies for deployment. The fiscal year 2005 nuclear energy budget
    request also reflects the establishment of the Idaho National
    Laboratory, which will serve as the Nation's primary center for
    strategic nuclear energy research, development, demonstration, and
    education. It will lead the DOE's investigation of a new type of
    nuclear power plant that is proliferation-resistant and melt-down
    proof--the next generation nuclear power plant. It is our objective
    that the Idaho National Laboratory will become the world's premier
    nuclear energy technology center within a decade.
    Energy Security and Assurance
        The widespread blackout of August 2003--affecting an area
    encompassing 50 million people, 8 States, and 1 Canadian province--was
    a strong reminder that our Nation's electricity grid has
    vulnerabilities and weaknesses which need to be addressed. Energy
    reliability is imperative. The budget request for Other Defense
    Activities includes $10.6 million for Energy Security and Assurance
    activities to help ensure a secure and reliable energy infrastructure
    in the new environment of heightened security and the increasing
    complexity of energy interdependencies. These activities will
    complement the efforts undertaken by the Department's Office of
    Electric Transmission and Distribution and the activities of the
    Department of Homeland Security (DHS).
    Environment, Safety, and Health
        The fiscal year 2005 budget includes $135.0 million for the Office
    of Environment, Safety, and Health, of which $104.5 million falls under
    the jurisdiction of this committee. Within the $104.5 million, there is
    a request of $43.0 million within the Environment, Safety and Health
    program to accelerate the processing of applications from contractor
    workers who may have become ill as a result of their work at DOE
    facilities. This is a matter of doing what's right and taking care of
    those whose labors helped secure our safety. With this budget request,
    we plan to implement a 3-year program to eliminate the backlog of
    applications by the end of 2006.
    Security and Safety Performance Assurance
        I recently brought the Office of Security and the Office of
    Independent Oversight and Performance Assurance under a single manager
    to create the Office of Security and Safety Performance Assurance. The
    intent of the establishment of the Office of Security and Safety
    Performance Assurance is to increase the effectiveness and efficiency
    of the Department's safeguards and security programs in light of the
    new environment we now live in. These two functions will maintain their
    distinctive roles and responsibilities within the Office of Security
    and Safety Performance Assurance. In fiscal year 2005, the budget
    request for the Office of Security and Safety Performance Assurance is
    $279.8 million, with $255.1 million for Office of Security to continue
    to develop and interpret safeguards and security policy for the entire
    Department, and $24.7 million for Office of Independent Oversight and
    Performance Assurance to continue to evaluate the implementation of
    policy, the effectiveness of security training and technology
    implementation, and identify issues concerning the adequacy of policy.
    Legacy Management
        The budget includes $66.0 million for the Office of LM to manage
    post-environmental-cleanup activities. This organization demonstrates
    the DOE's long-term commitment to manage requirements relevant to
    closure sites beyond the completion of remediation.
    Future Liabilities
        The budget also includes a total of $8.0 million for a new Office
    of Future Liabilities, which is funded by the Energy Supply
    appropriation at $3.0 million and the Other Defense Appropriation at
    $5.0 million. This is a planning office to address various future
    cleanup activities at sites with continuing missions. The fiscal year
    2005 budget provides funds to plan for environmental liabilities not
    currently assigned within the Department.
        As in previous years, the fiscal year 2005 budget requests funding
    within the Other Defense Activities appropriation to offset funding
    within the departmental administration appropriation. This offset of
    $92.4 million for Defense-Related Administrative Support addresses the
    significant amount of administrative support activities performed
    within the departmental administration appropriation that are of direct
    benefit to the DOE's defense-related programs. The fiscal year 2004
    Energy and Water Development conference report directed the Department
    to submit a budget request for fiscal year 2005 that reflects a
    proportional contribution from other defense activities for
    departmental administration costs. Fiscal year 2005 funding represents
    32.7 percent of the departmental administration appropriation
    administrative costs.
                                   conclusion
        The Department's fiscal year 2005 budget request reflects the
    accomplishments of the last 3 years, the successes and the many
    changes. This request charts a focused course of investment for the
    Nation's future, one guided by a cohesive mission and targeted
    performance metrics. Making all of this work are the extremely talented
    men and women of the DOE which includes the world's top engineers and
    scientists. It is a privilege to work alongside them on a common
    mission. It is an honor to serve a President who has provided this
    vision of what this Department can--and will--accomplish in fiscal year
    2005 and beyond.
        Thank you. This concludes my formal statement. I would be pleased
    to answer any questions you may have at this time.

        Chairman Warner. Thank you very much, Mr. Secretary, and I
    know that all members of this committee admire the work that
    you have done and the continuing public service that you and
    your family render. I guess to put it personally, we kind of
    miss you.
        Secretary Abraham. Thank you, Mr. Chairman.
        Chairman Warner. Now, you mentioned the important work that
    you do with the United States Navy in terms of nuclear reactors
    for our submarine fleet and carrier force. I've had 35
    wonderful years of experience with that program, starting in
    1969 when I entered the DOD and now these 25 years in the
    Senate. It has compiled a safety record second to none in the
    world. We have had really no major accidents that we know of
    attributed to any malfunctioning of the power plants aboard our
    naval vessels. We have achieved extraordinary milestones in the
    construction of the cutting edge of submarines to protect this
    nation.
        Now, as you well know, the DOD years ago, when I had a hand
    in it, created the program that was once associated with
    Admiral Rickover, with whom I worked and enjoyed a very strong
    professional and friendly relationship. The individual that
    occupies that position currently, Admiral Bowman, I think has
    done a very admirable job. It is an 8-year tenure. It is my
    judgement that we should continue that 8-year tenure. Do you
    have any difference of opinion on that?
        Secretary Abraham. No. Admittedly, my time in the job has
    entirely coincided with Admiral Bowman's leadership. He has
    done an outstanding job, but it has been my sense that having a
    turnover of leadership on a periodic basis actually brings a
    certain amount of strength to the position, but I wouldn't want
    to in any sense suggest that the current occupant has not done
    an outstanding job.
        Chairman Warner. No, I was not raising it for that question
    because I think he recognizes that at the completion of his 8
    years we would have a sequential successor to come along, and I
    am certain there are many outstanding individuals in the United
    States who can step up. But I believe that position is
    different than almost any other in our whole defense structure
    of service and DOE service, so I am for continuing that 8
    years, and when the appropriate time comes, I am sure that the
    Secretary of Defense will nominate an individual for that
    office to continue for another sequence of 8 years.
        I am going to look further into that with the DOD, because
    I want to continue that program. I really set in place years
    ago that 8-year tenure, and I think there is a measure of
    independence and originality and creative thinking that goes
    with that post that the 8 years enables the occupant to render.
        Let us talk about the RNEP. I was looking at the out-years,
    and particularly 2006, looking at a fairly substantial
    increase, and I bring to your attention the fact, as I
    mentioned in my opening statement, that in 2004 we put in the
    legislation that the DOE may not proceed to the engineering
    development phase 6.3 or to subsequent phases without a
    specific authorization from Congress. Could you correlate that
    substantial 2006 bump-up with this statutory provision, which I
    hope will remain?
        Secretary Abraham. The statutory provision, Mr. Chairman,
    would of course govern any decision to move from a stage of
    research or preliminary inquiry to the engineering phase. We
    are required to provide 5-year budgets, however, so that people
    can look down the road and make a proper sort of assessment of
    what potential expenses will be. In this case, we have
    satisfied that by offering in the budget an outlook of what
    would be the kinds of costs involved if several preliminary and
    important steps were to take place. First, that we would
    complete the research work that we proposed to do. Second, that
    it would be a decision made by the executive branch that as it
    is considering ways to deal with the issue of hard, deeply-
    buried targets, that the preferred approach would be the
    hardening of an existing nuclear weapon, and that a
    recommendation would be made to proceed. After which, the
    congressional ratification and support for that would be
    required before we would move to that engineering----
        Chairman Warner. The short answer to it is that you have to
    do your budget programming----
        Secretary Abraham. Right, and we want to be very----
        Chairman Warner. In no way does that imply that the
    administration will come and try to revise the existing
    statutory framework.
        Secretary Abraham. No, not at all, and the alternative
    would be to not put those numbers out and have someone suggest
    that we were somehow keeping that secret. We felt we have a
    responsibility----
        Chairman Warner. I think you have taken the prudent course
    of action on that, Mr. Secretary, and I am glad we have placed
    in today's record a clear explanation for it.
        Last week, you were featured in a Washington Post article
    discussing the nuclear-related components for the United States
    to remove from Libya in the wake of Libya's decision to
    dismantle its nuclear and WMD programs. I think the
    administration deserves an enormous amount of credit for the
    initiatives taken with Libya on that together with other
    nations working with us.
        What can you tell the committee about the nonproliferation
    activities that DOE has undertaken in Libya, and do you have
    any plans for additional nonproliferation activities in Libya?
        Secretary Abraham. Well, essentially in Libya we have
    engaged in several activities. The initial phase of the
    activity was to remove the nuclear material that had been
    secured for a uranium enrichment processing effort, as well as
    the key components of the machines that would be used for that
    effort so they would not be functional. That was the material
    that came to the United States in the first phase of the
    effort.
        The second phase was to bring the remainder of the WMD
    materials that were discovered there, a much larger tranche of
    material. Just to put this in perspective, the first phase was
    about 55,000 pounds of equipment, material, and machinery. The
    second is about 5 percent of the total. The third component,
    which we are also very pleased about, was that working with the
    Libyan Government, and with the Russian Federation, and with
    the IAEA, we were able to secure and return to Russia the fresh
    fuel that was at the Tajura research reactor site in Libya, the
    kind of weapons-grade or near weapons-grade material or fuel
    that was under-secured and obviously a potential source of
    material for some type of proliferation usage. So that has been
    returned to Russia.
        We now will continue the work to try to address the core of
    that reactor to turn it into a safe alternative.
        Chairman Warner. I think that is commendable, Mr.
    Secretary. Last month you announced a new program to provide
    employment opportunities for Iraqi scientists, technicians, and
    engineers. I commend you for that, too. The program seeks to
    support reconstruction efforts and prevent the proliferation of
    WMD expertise to terrorists or proliferating states. What can
    you tell the committee about this new program aimed at
    facilitating productive research activities for these
    scientists so that they will not travel elsewhere in the world?
        Secretary Abraham. Mr. Chairman, we have had some very
    positive success in the DOD's nonproliferation work over a long
    period of time, primarily with the Russian Federation, on
    finding alternative occupational opportunities for folks with
    the expertise, whether they are scientists or technicians in
    the area of nuclear work, and we intend to build on that
    approach with respect to this latest mission. It has just been
    launched, and we will keep the committee well-informed of the
    progress that we make.
        Chairman Warner. Thank you very much, Mr. Secretary. My
    time has expired.
        Senator Levin. Thank you, Mr. Chairman. Presidents Bush and
    Clinton prepared an annual nuclear weapons stockpile memorandum
    that outlined, among other things, the number of nuclear
    weapons in the stockpile by weapons type and the number of
    weapons by type in each of the various states of readiness.
    Each document usually covered a 5-year period which allowed for
    planning decisions to be made, and President Bush has not
    submitted an annual document since the December 2001 Nuclear
    Posture Review (NPR).
        We have been told that the memorandum is almost finished,
    but it has not been submitted. There also was a requirement in
    last year's appropriations law for something similar to that
    called the Stockpile Plan to be submitted with the budget. What
    is the status of that memorandum?
        Secretary Abraham. You are right, and I might say that the
    provisions in the appropriation bill related to programs in my
    department, even though we are not singularly responsible for
    this report, but the fencing was on our dollar so obviously we
    have an interest in doing this. We also have an interest in
    doing it thoroughly and well, so it is occupying a lot of
    attention, both at the DOE and the DOD. We believe it will be
    done soon, but it will be done comprehensively to try to give
    this committee and the other responsible committees a clear
    indication of what we think, what the administration is
    recommending in terms of the stockpile composition.
        Senator Levin. Was the administration aware of the fact
    that that was supposed to be submitted with the budget?
        Secretary Abraham. I am sure that that is known by the
    administration. I assured the committee that we are working
    very hard to do this well and the delays are not because of a
    desire to avoid doing this, but because we want to do it
    effectively.
        Senator Levin. The fiscal year 2004 budget request sought
    $6 million for work on advanced nuclear weapons concepts, and
    that amount was authorized and appropriated last year, but
    Congress prohibited the DOE from spending $4 million of the $6
    million until 90 days after a revised Stockpile Plan was
    submitted to Congress. That Stockpile Plan has not been
    submitted to Congress. When is that plan going to be submitted?
        Secretary Abraham. Really, these are in the same basic
    process, and we hope it will be done soon. I would just note
    that actually the entire $6 million was predicated on the
    completion and submission of various documents to Congress. The
    first $2 million of the advanced concept money was actually
    held in reserve until NNSA submits a report on how that money
    will be spent, and then can not be spent for 30 days after
    that. That report was submitted on March 12, so we actually
    have not begun even the work on the first $2 million. We are
    doing our best to finish this project so that the remainder
    would be available.
        Senator Levin. Is the preparation of the revised Stockpile
    Plan contingent on the President signing that nuclear weapons
    stockpile memo?
        Secretary Abraham. I am not sure what the exact sequence
    is. I would have to answer that for the record.
        [The information referred to follows:]

        While transmittal of the Report to Congress on the Revised Nuclear
    Warhead Stockpile Plan is contingent on the President's approval of the
    fiscal year 2004-2012 Nuclear Weapons Stockpile Plan, preparation and
    coordination of the report to Congress is not. DOE and DOD are now
    coordinating a draft report to Congress. It is expected that once the
    President approves the fiscal year 2004-2012 Nuclear Weapons Stockpile
    Plan, transmission of the report to Congress will occur in an expedited
    fashion.

        Senator Levin. You and I have talked about the Strategic
    Petroleum Reserve (SPR), Mr. Secretary, and I want to ask you a
    question about that and put a chart up there for us. Gas prices
    are at a record high, and what that chart shows is that over
    the last 2 years, the DOE has added about 85 million barrels to
    the SPR. That is the red line going up. At the same time,
    private sector inventories of crude oil have fallen by about 50
    million barrels to their lowest level in 30 years, and that is
    the white line going down.
        Goldman Sachs, which is the largest crude oil trader in the
    world, has said that the buildups in storage have lowered
    commercially available petroleum supplies, and John Shages, who
    is your director of finance and policy for the SPR, said in a
    briefing in the spring of 2002 the following: ``Commercial
    petroleum inventories are low, retail product prices are high,
    and economic growth is slow.'' He concluded that ``the
    Government should avoid acquiring oil for the Reserve under
    these circumstances.''
        Is that still his position?
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Secretary Abraham. I do not know what his position
    personally is, but our administration's position is that the
    reason we are filling the Reserve is predicated on national
    security concerns. In the wake of the events of September 11, a
    number of people have, I think, felt that having the Reserve
    filled to its entire 700 million barrel limit was a critical
    national security objective, and the President directed the DOE
    to move ahead to fill it, which is the underlying rationale for
    doing the things we are doing.
        We recognize that there are obviously other issues in play,
    but the overriding concern we had was to have the Reserve at
    maximum strength in the event that there was a serious
    disruption in supply at some point.
        Senator Levin. Now, the Reserve is currently 93 percent
    filled, is that correct?
        Secretary Abraham. About 645, 650 million.
        Senator Levin. Out of 700 million barrels. Do you have any
    disagreement with those figures? Offhand, would you agree----
        Secretary Abraham. We started somewhere around 540 million,
    and we are about 100 million more than that now.
        Senator Levin. But would you agree that the private
    sector's inventory has gone down to what is near a record low
    while yours has gone up?
        Secretary Abraham. The private sector is lower than it was
    when this started. I do not know exactly----
        Senator Levin. Would you agree that there is a relationship
    between the price of gasoline and other petroleum products and
    the shortage of supply?
        Secretary Abraham. I think it may be the opposite way. I
    think the impact on price of supply is obvious. I do not think
    the price of gasoline is affecting supply.
        Senator Levin. What I am saying is that when supply goes
    down in the private inventories the price is going to go up.
        Secretary Abraham. The Energy Information Administration,
    which is an independent arm of the DOE, has been asked by us to
    gauge the impact on price of our very slow increase in the size
    of the Reserve, and have reached the conclusion that the impact
    is nearly negligible.
        Senator Levin. Dr. Phil Verleger, who is probably the
    foremost petroleum economist in the Petroleum Economics
    Monthly, reaches a very different conclusion than you do, which
    is that oil would have been perhaps $8 per barrel lower had in
    the last few years the administration followed what he calls a
    rational strategy, which is that you buy when oil prices are
    low and you do not add to the inventory when supplies are low
    in the private sector and when the price is high.
        I would hope that the administration would take a look at
    these outside analysts, but also I would ask if you would be
    willing to ask the director of finance and policy for the SPR,
    a man who works for you, whether or not he continues to--and I
    am talking about his own view, not the administration view--
    whether or not it continues to be his view that when commercial
    petroleum products are low, retail product prices are high, and
    economic growth is slow, that the Federal Government should
    avoid acquiring oil for the Reserve under those circumstances.
    Would you be willing to ask for the record that he supply us
    with his view of that?
        Secretary Abraham. I will. I am sure he has that view, and
    I would be happy to have him submit his view on that basis.
        [The information referred to follows:]
               Acquiring Oil for the Strategic Petroleum Reserve
        The following are the personal views of John D. Shages, Acting
    Deputy Assistant Secretary, Petroleum Reserves, on acquiring oil for
    the Strategic Petroleum Reserve (SPR):
        It is my opinion that there are a wide array of considerations that
    could and should be factored into when, and at what rate, to add
    inventory to the SPR. The weight I would put on each of the factors
    depends on circumstances and will change with time. The administration
    has put the preponderance of weight on the need for increased energy
    security. At this time, I also put more weight on the value of energy
    security than the three factors listed for consideration. The SPR is
    the only U.S. Government tool for assuring oil supplies to consumers
    during an interruption, especially if caused by war, or intentional
    export curtailment. The potential need for the protection the Reserve
    offers has been increasing due to increasing consumption, increasing
    imports, decreasing unutilized production capacity anywhere in the
    world, and a general decrease in political stability in producing
    countries. It is my opinion that the optimal inventory of the Reserve
    is substantially higher than the current inventory of about 655 million
    barrels, which equates to only 57 days of net U.S. imports as of May
    10, 2004. Adding inventory to the Reserve is inherently good for energy
    security, and the additional inventory will prove to be a worthwhile
    investment for American taxpayers when the oil is ultimately sold.
    Slow Economic Growth
        With regard to SPR oil acquisition and economic cycles, it is my
    opinion that oil prices have a more powerful impact on the overall
    economy than is recognized by most economists. Consequently, oil
    acquisition for the Reserve, and the associated price effect, could be
    timed to slow an overheated economy or stimulate a slack economy if
    there was no urgency to add inventory, and if the Organization of
    Petroleum Exporting Countries (OPEC) were not attempting to control
    inventories and prices. Under current circumstances, the U.S. economy
    is enjoying robust economic growth. Gross domestic product grew 4.4
    percent in the first quarter of 2004, after strong growth during 2003.
    The government has been stimulating the economy aggressively since 2001
    using both monetary policy and fiscal policy. These stimuli have had
    the desired impact; the recession of 2001 has faded, business
    investment has picked up, and consumer confidence is high. The strength
    of the recovery is such that the preponderance of informed opinion is
    the Federal Reserve Board will begin to increase interest rates later
    this year. Therefore, from the perspective of economic policy, the
    economy does not need to be stimulated by reducing the Reserve fill
    rate. Current conditions are attractive for oil acquisition, especially
    relative to 2002 when the economy was coming out of recession,
    suffering the uncertainty of the events of September 11, 2001, and
    anticipating a war in Iraq. Based on the criterion of slow economic
    growth, I do not recommend avoiding oil acquisition for the SPR at this
    time.
    Low Inventories
        Regarding inventories, it is my opinion, other things being equal,
    it would generally be wise to adjust the fill rate of the Reserve
    whenever there is an immediate danger of disruption and/or shortage in
    world oil markets. That being said, at this time, I believe the short-
    term danger of disruption and/or shortage is about the same as the
    average long-term danger. World oil production is about 80 million
    barrels per day, domestic crude oil inventories are 9 million barrels
    above where they were this time last year, and as of May 10, 2004, are
    29 million barrels above the 270 million barrel level widely recognized
    as the minimum operating level. The inventory of all oil products has
    increased by 33 million barrels since this time last year. On a
    worldwide basis, inventories of crude oil grew by approximately 2
    million barrels per day during March and April. Although current U.S.
    inventories of gasoline are below the 5-year moving average, I believe
    price changes will balance supply and demand without shortages or the
    uncertainty associated with supply disruptions. Furthermore, it is my
    opinion that the OPEC cartel is paying close attention to world and
    U.S. inventories, and that our oil acquisitions for the Reserve are
    being accommodated. This is different from my opinion of 2 years ago--
    that OPEC was fixated on their export levels and indifferent to
    commercial inventories. Under the current circumstances, I believe any
    action by the U.S. to increase marginal inventories by adjusting
    Reserve fill rates would be offset by adjustments in OPEC crude oil
    exports, and would have no net consequence other than to slow the
    addition of inventory to the SPR. Therefore, based on the criterion of
    low inventories, I do not recommend avoiding oil acquisition for the
    Reserve at this time.
    High Prices
        The question of whether oil prices are high enough to justify
    consideration of altering a government program designed to enhance
    essential energy security will always be complicated. The first issue
    is whether current prices that are high relative to historical prices
    will also be viewed as high in the future. It is my opinion that we
    have reached a new plateau for oil prices, and that any return to
    prices below $30 per barrel in the future will be considered an
    anomaly. World demand outside of North America and Europe is growing at
    a rate sufficient to absorb all anticipated growth in world oil
    production outside of the Persian Gulf. Further, despite rhetoric from
    various OPEC spokesmen, I believe that organization is intent on
    balancing supply with demand to yield prices significantly higher than
    the professed $22-$28 target range. Consequently, for the next few
    years, I anticipate a market price centering on $35 per barrel and
    fluctuating between $30 and $40 per barrel, after which I expect prices
    will increase. It is also my view, it is not feasible to manipulate
    world oil prices with the small amounts of oil being added to the SPR.
    In 2002, I was of the view that OPEC would be indifferent to the fill
    policy of the United States. I believe OPEC is now attempting to manage
    both the level of commercial inventories and prices. Consequently, any
    short-term success we might achieve at raising inventories and reducing
    prices would quickly be offset by countervailing OPEC production
    policies.
        The second issue is whether it is wise to use the Reserve fill rate
    to attempt to influence market prices when there is no distinct event
    causing a shortage. The fact that prices for crude oil are high and
    gasoline prices are at record highs might in other circumstances lead
    me to advise against acquiring oil for the Reserve. In the current
    circumstances, the U.S. economy is growing at a strong pace, and
    gasoline consumption is rising despite the high prices. It is
    disturbing that U.S. gasoline demand in the first quarter was 4.4
    percent higher than in 2003 regardless of a significant price increase.
    Despite much public discourse on the gasoline price level, consumers
    have not noticeably modified their consumption patterns, and they are
    continuing to buy vehicles with low fuel mileage ratings. As recently
    noted by Federal Reserve Board Chairman Alan Greenspan, high prices
    maintained over a long period will be perceived as permanent and lead
    to investments in efficient technologies. That observation should also
    apply to consumers, who will be willing to pay more for technology such
    as hybrid engines in cars. In his congressional testimony on the
    penetration of hybrid technology into the automotive marketplace, Ford
    Motor Company Chairman Bill Ford commented on the necessity for
    consistently high gasoline prices in order for manufacturers and
    consumers to make the investment in hybrid technology. Given current
    gasoline consumption trends, which I believe are unsustainable, it is
    my opinion, it would be counterproductive to use Reserve fill rates to
    artificially reduce oil prices, discourage investment in efficient
    technology, and encourage greater consumption. Based on the criterion
    of high prices, I do not recommend avoiding oil acquisition for the SPR
    at this time.

        Secretary Abraham. I just would make three points to you.
    First, all of the components you just mentioned are important
    ones, but none of them involve national security, and we have
    to weigh these countervailing considerations when we make these
    decisions. Second, the analysis that you referenced, the
    outside analysis, that suggests that there's a $6 to $8-a-
    barrel difference is strongly held by the economist you
    mentioned, but there are a number of other analysts, and I
    would be happy, Mr. Chairman, to submit for the record the
    analysis of a number of other outside analysts who contend, as
    does the Energy Information Administration, that the impact of
    this 120,000-barrel-a-day or so fill out of an 80 million-
    barrel-a-day worldwide consumption level is negligible.
        The other point I would make, and this is one that I think
    is very important, is that we do not act in a vacuum when we do
    these things. This is a very transparent, very predictable
    long-term fill that we have undertaken. It is well known by
    those in the marketplace who study and monitor and react to
    such things. It is also noted by those who set their own levels
    of production based on what they believe to be worldwide
    consumption targets and so on, including OPEC, and I believe it
    is entirely possible that if we were to dispense with fill or
    to defer fill, there would be a countervailing action on the
    part of producers to reduce production accordingly, which would
    have the effect of off-setting any changes we would make.
        That is not just sort of speculation. In fact, recently the
    immediate past president of OPEC made exactly that statement,
    which I'd be happy to submit for the record. So I think there
    are a lot of factors that come into play. I just would
    reemphasize that we have placed the national security factor at
    the top of the list of our considerations.
        [The information referred to follows:]

        The OPEC statement referred to by Secretary Abraham is quoted in
    the following portion of a March 14, 2004, Dow Jones article titled
    ``Qatar Oil Min: Extra SPR Oil Would Add To Q2 Concerns.'' The article
    reads ``Qatar's Oil Minister Abdullah bin Hamed al-Attiyah said Sunday
    that any extra Strategic Petroleum Reserve oil on the market at this
    time would add to concerns of a crude oil stock build in the second
    quarter. Al-Attiyah was speaking on the sidelines of an industry event
    in Cairo. Al-Attiyah's comments followed a question on what impact he
    thinks a decision by the U.S. Senate to support lobbying by the
    transport industry to prevent the U.S. Government filling the SPR with
    53 million barrels will have on the market. `It will mean more oil on
    the market, very simply,' he said, adding `This is our concern, how to
    manage this surplus.' ''

        Senator Levin. I will just conclude with the following
    comment. If there is a small amount of oil being added each
    day, it is a much bigger proportion of the private inventory
    than it is of our SPR. The private inventory is 280 million
    barrels. The SPR is now 650 million barrels, 2\1/2\ times the
    inventory in the private commercial world. So if this is a very
    minor part of the SPR, 150,000 or 120,000 barrels a day, it is
    a much bigger contribution to the private sector's inventory.
        Number two, of course this is a security issue, but our
    economic security is an important issue too, and the price of
    gasoline, oil, and jet fuel now are at record highs. It is a
    drag on the economy, and our economic strength surely is a
    significant part of our overall security as well.
        So I would hope that the administration would take a look
    at the vote in the Senate. When we did vote to not add the
    final 50 million or so barrels to the SPR, according to the
    analysts, the next day for just a short period of time the
    price of oil dropped because of our action. That does not mean
    it will be kept in conference, and it does not mean that the
    House will adopt it even though a large bipartisan group of
    House members has now supported the Senate action.
        What it does mean is that until the chairman of the Energy
    Committee the next day said that he was not going to support
    this provision in conference, when the price went right back up
    again, the impact of just that Senate action caused the price
    of oil immediately to drop. I would hope that the
    administration would reconsider, given the importance of our
    economy being strong, the impact of high energy prices, and
    that the administration would take a look at the overall
    security, not just the question of whether or not 60 million
    more barrels would be added to a reserve that is 93 percent
    filled, but also the impact adding 120,000 barrels a day to the
    SPR has on our economic security.
        My time is up, and I thank you, Mr. Chairman.
        Chairman Warner. Thank you, Mr. Levin.
        Senator Kennedy.
        Senator Kennedy. Thank you very much. Welcome, Mr.
    Secretary, back to the Senate, old friend. Just quickly, to
    pick up on a theme that Senator Levin has mentioned here about
    the cost of gasoline, it is extremely difficult to try and
    convince my constituents in Massachusetts, where we have
    thousands of men and women in Iraq protecting the security of
    the countries in that region, while they refuse to respond to
    the economic challenges that consumers are facing and that our
    economy is facing by giving increased production. No one in my
    State can understand why the President of the United States is
    not jaw-boning OPEC to increase production, to make a
    difference at the very time that we are losing men and women
    over there in Iraq.
        It is an intolerable position, Mr. Secretary. Maybe there
    is a rationale for that, but it is an intolerable position. No
    one can understand that. We have seen it other times when
    Presidents of the United States have jaw-boned the OPEC
    countries. We have seen where they have made an accommodation
    and adjustment. For them not to be responsive in terms of the
    types of issues that we have just talked about in enhancing our
    SPR, and not only doing that but also making a difference in
    terms of the restoration of our economy, which according to the
    President of the United States has been heavily damaged--we
    might differ in the extent of it--but because of September 11.
        It just does not make sense. I do not know if you have
    talked to him about it or if you have a view on it. I want to
    give you a quick chance to comment, and then I want to just get
    to another issue.
        Secretary Abraham. Thank you. I would reiterate what I said
    earlier. One of the reasons we are filling the Reserve is
    because we are concerned about what happened after September
    11, and we believe having a supply that is protected at full
    strength is an important priority. We also are concerned about
    prices. I have expressed this on a number of occasions
    recently. We have also made it clear that we are not going to
    beg for oil.
        Senator Kennedy. We are not begging. We are losing men and
    women over there all the time. This is the second time we have
    gone to the Middle East on this. We are protecting their oil
    supplies, their oil patch over there, and they are just
    tightening the grip on it and putting the costs of this up to
    record highs in times we are trying to get our economy going
    and get people back to work, and they are trying to strengthen
    the opportunity for these workers. Have you talked to the
    President about it?
        Secretary Abraham. Obviously, this is of concern to all of
    us, and how we proceed is an issue we talk about on a regular
    basis.
        Senator Kennedy. I hope you would at least raise this. I
    think it would be worthwhile to raise it with him as a
    reasonable action. I think there would be an enormously
    positive response here. Hopefully there would be an action from
    those countries. I think it is just absolutely intolerable.
        Mr. Secretary, the NPR sets out a new policy that claims to
    make the U.S. less dependent than it has been in the past on a
    nuclear force that is to provide its offensive deterrent
    capability. That says that on the one hand, but on the other
    hand it is a case of what the administration does versus what
    it says. We see this in a number of different policy areas, but
    let us take it on this one.
        You are moving ahead, you are rushing ahead with new
    nuclear weapons, including the mini-nukes and the nuclear
    bunker busters. I would like to give you a chance to explain
    how this program, which was $45 million 2 years ago, is now up
    to almost a half a billion dollars. The administration is
    rushing to test the nuclear weapons. You are spending $30
    million, and you are increasing the spending on the nuclear
    test grounds as well. You are planning a factory for plutonium
    pits, and not securing the stockpiles that we already have. You
    are cutting back on the funds for Nunn-Lugar, and you are also
    cutting the training for security and nuclear weapons labs.
    People are going to wonder why in the world at the same time we
    are seeing terrorism in Madrid, let alone the threat of al
    Qaeda, we are cutting the funds on nuclear security. Why, when
    we have the opportunities to move ahead in the Former Soviet
    Union with a very successful program, when we have 59 percent
    of the weapons-useable material that remains unsecured, why are
    we going ahead and requesting a half a billion dollars for
    Congress on new nuclear weapons, the bunker buster?
        Whatever you can tell us about the military applicability
    which you are going to have with a nuclear bunker buster, the
    most important thing is accurate intelligence. What we have
    seen in the recent Iraqi situation raises serious questions
    about that issue and is going to encourage other countries
    around the world to give consideration in resuming the nuclear
    arms race. How can we possibly go down this path?
        Secretary Abraham. Let me just walk through some of the
    questions you raised, and if there are ones I do not get to or
    forget, please remind me. First, we are not in the process of
    making any new nuclear weapons or proposing to build any new
    nuclear weapons, mini-nukes or otherwise, and we recognize
    fully that any decision ever that we might make along that line
    would be one that would require congressional approval.
        In terms of the cost of the RNEP, the half a billion dollar
    proposal that you referenced, as I said in an earlier answer,
    we are required to put forth to Congress in our budget a 5-year
    budget based on possibilities of expenditures. If we were to
    make a decision to go to an engineering phase or the
    modification of an existing weapon to a more hardened weapon,
    Congress would have to approve it. If both of those actions
    happened, that decision was made and Congress approved it, we
    felt Congress needed to have a sense of what the potential
    costs would be so there would not be a later claim that these
    costs had been kept somehow secret.
        With respect to cutting money for Russian programs, in the
    budget of the DOE, the nonproliferation budget that we had in
    place when I took this office was about $890 million. The
    submission which we have made this year is for $1.35 billion.
    The programs in Russia that we work on are ones which we have
    worked very hard to enhance and to accelerate. We have expanded
    the work we do from primarily work with our counterpart agency,
    the Ministry of Atomic Energy, to now do work on the Strategic
    Rocket Forces programs in Russia to securitize those as well as
    the Russian Navy.
        We are making excellent progress. By the end of 2005, I
    think we will have almost completed the work on the Russian
    Navy program and made major progress on the Strategic Rocket
    Forces. With respect to security within the DOE, the budget for
    that program just 3 years ago was under $1 billion a year. It
    is now $1.4 billion. We have just finished a new threat
    assessment, which calls for a $144 million increase as a
    response to that, in our budget for this year over and above
    what we had last year to address the new DBT. So we are
    actually increasing the support for security within our
    complex.
        Senator Kennedy. My time is up, Mr. Chairman, but I would
    like to, for the record, compare my figures with regard to last
    year, side by side with the Secretary's.
        Secretary Abraham. We'll be glad to, sir.
        [The information referred to follows:]
        Senator Kennedy.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Secretary Abraham.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Kennedy. Are there any circumstances whatsoever in
    your research that you could foresee the possibility of any
    testing?
        Secretary Abraham. At this point there is absolutely none.
        Senator Kennedy. Is your understanding of the language that
    is now in Congress that it gives you any authority to move
    ahead with any kind of testing as part of the research program?
        Secretary Abraham. The work we are doing in terms of
    nuclear testing is to simply reduce----
        Chairman Warner. Excuse me, Senator. You mean live testing?
        Senator Kennedy. Live testing, excuse me. I thank the
    chair. I apologize to the Secretary, but you know what I am
    talking about. In terms of the research of these programs, do
    you see any possibility of having as part of the research a
    program live test?
        Secretary Abraham. We do subcritical work at the Nevada
    test site, but we do not engage in live testing of a critical
    level.
        Senator Kennedy. You do not foresee it with regard to these
    two weapons, the bunker buster and the low-threshold war----
        Secretary Abraham. I just want to clarify if I can, Mr.
    Chairman, the Precision Low Yield Weapon Design (PLYWD), as it
    was called, provision was not designed to launch an inquiry or
    the development of new nuclear weapons of any size, small or
    large. On the RNEP, this was a project in which we were asked
    to consider whether the modification of an existing weapon
    could serve as an effective agent in dealing with hard, deeply-
    buried targets. We are doing the research on that, nothing
    more, and would require congressional endorsement to move to an
    engineering level.
        Chairman Warner. Thank you, Senator Kennedy.
        Senator Reed.
        Senator Reed. Thank you, Mr. Secretary, and welcome back. I
    want to follow up on some of these questions about the RNEP. As
    I understand it, you can not go into phase 6.3 without
    congressional authority.
        Secretary Abraham. Right.
        Senator Reed. So in a sense you have a budget that presumes
    that congressional authority, is that correct?
        Secretary Abraham. No, I would not characterize it that
    way. We decided we had a responsibility to provide Congress
    with an understanding of what the costs would be if we were to
    move to that phase.
        Senator Reed. You could do that through a letter, but when
    you put it in your budget every dollar you commit to the RNEP
    is a dollar less for nonproliferation programs, less for
    stockpile maintenance programs, less for other valuable
    programs. This is one area quite specifically which Congress
    says you can not go beyond the 6.2/6.2a phase unless you get
    specific approval from Congress.
        Secretary Abraham. Right. I agree with the sequence, and
    all I can say is that my experience in the way these things
    work is that failure to do this would result in some people
    arguing that we were being deceptive or that we had secret
    plans.
        Senator Reed. Let me ask, what other programs are you
    funding which are prohibited by Congress today in your budget?
        Secretary Abraham. Senator, we are not funding any program
    that is prohibited, and all we are offering Congress is a cost
    assessment of what the programs might be.
        Senator Reed. Mr. Secretary, with all due respect, you have
    a budget which is saying this is how you intend to spend the
    money, and the problem is in this case there is a specific
    prohibition against spending money as you would like to do in
    2007/2008, and so I think rather than begin avoiding the
    characterization of being deceptive, you are quite transparent.
    The problem is, there is still a statute on the books that says
    you can not go into 6.3 without our approval.
        Secretary Abraham. I acknowledge that, and I would also
    emphasize to this committee that no decision has been made as
    to whether or not--first of all, let us put in perspective that
    the budget which we proposed for the RNEP program was
    significantly reduced in the appropriations process last year,
    thus causing the process, the whole inquiry that we have
    engaged in, to be slowed down substantially. It accounts for
    the fact that this year's budget requests a larger amount than
    would have otherwise been the case. Because of that, the design
    or thinking and research work that was to be conducted on two
    separate weapons had to be changed. Instead of doing an inquiry
    with regard to both weapons, we have only had the money to do
    an inquiry with regard to the first one.
        So if we are successful in the appropriation process this
    time, then we would initiate the discussion and the inquiry on
    the second one. But we are far from the point of determining
    whether this approach will even be effective, let alone whether
    it is the preferred approach.
        Senator Reed. Mr. Secretary, I do think there is a danger
    of misleading us on what is essentially a budget and a program
    which goes beyond at this point congressional authority.
        Let me ask another question. Is there a specific military
    requirement for the RNEP today?
        Secretary Abraham. It was the conclusion of the NPR that a
    threat that needed to be addressed in the 21st century and the
    immediate period ahead of us would be hard, deeply-buried
    targets. A number of approaches to dealing with that were then
    asked to be researched. This is just one of them. It is a
    threat that rose to the level of being included in that review.
        Senator Reed. There is no doubt about the threat, but it is
    your opinion that the position of the administration is there
    was a specific military requirement for the RNEP, not for a
    device to counter deeply-buried targets, but for the RNEP. Is
    that your position?
        Secretary Abraham. No. The position of the administration
    is that we should make inquiries and investigate a variety of
    approaches to dealing with the hard, deeply-buried target.
    Whether or not this approach is feasible is the first question,
    and the second is whether or not it is preferable to other
    approaches that would involve conventional weapons. We have not
    completed the first phase of that inquiry, let alone the
    second.
        Senator Reed. Let me turn to another issue about advanced
    concepts. On page 4 of your statement, you discuss work related
    to, ``the feasibility of adapting an existing weapons carrier
    and existing nuclear warheads to achieve a delivery system with
    greater assurance that the intended nuclear mission could not
    be compromised by either component failure or adversary
    attack.''
        In the DOE's report identifying the advanced concepts work
    that we have done in fiscal year 2004, the only work that is
    discussed is work on, ``an enhanced nuclear cruise missile
    employing post-launch command and control and enhanced use
    control.'' Are you talking about the same project in your
    testimony or other documents?
        Secretary Abraham. I would have to look at the testimony.
    What I can tell you Ambassador Brooks says yes.
        Senator Reed. Just to be clear about that.
        Secretary Abraham. But I would reiterate what I said
    earlier. At this point we have not begun any work in terms of
    advanced concepts because of the restrictions on the funding.
        Senator Reed. Could you explain, or perhaps Ambassador
    Brooks could explain, post-launch command and control issues
    that you are dealing with?
        Secretary Abraham. I would really like to do that in closed
    session, sir.
        Senator Reed. You want to go in closed session?
        Secretary Abraham. I guess we would.
        Senator Reed. All right, if it is not appropriate for this
    forum, that is fine, Mr. Secretary. I do not want to press this
    issue.
        Let me just get back to another point. You and the
    President have recognized the importance that the Nunn-Lugar
    programs are playing, and there has been an increase of
    funding, but one of the sad commentaries of today's world is
    there seem to be so many ways to spend that money, and even
    with increases in money, there is not enough money.
        But in your view, what are the most urgent opportunities or
    targets?
        Secretary Abraham. Let me talk about our programs
    specifically, because that is where my focus is. I think that
    we have placed an increasing priority on the global cleanout of
    research reactor fuel that is of a weapons-grade or a near-
    weapons-grade quality. We have had some excellent ad hoc
    success with respect to several joint ventures with Russia,
    with the IAEA, and places like Serbia, Libya most recently,
    Bulgaria, and Romania. I believe more will be coming.
        We also have had success and are near the point of entering
    into a government-to-government agreement with the Russian
    Federation, which I think would formalize and help us to
    expedite that process so that we might be able to recover all
    of the spent fuel of Russian origin from the various reactor
    sites by the end of fiscal year 2005. That is our goal. We see
    that as a top priority.
        Last year, in my testimony here I mentioned the issue of
    RDDs and the kinds of material which had historically not been
    the focus of international attention and scrutiny, medical
    isotopes and other radiological material, but that could become
    the basis for some type of RDD. At my suggestion, the IAEA,
    U.S., and Russian Federation hosted an international conference
    last March with 127 nations participating to begin an
    international effort to both better account for as well as
    frankly educate and assist countries in addressing these
    issues. We have a lot of countries who are part of the NPT who
    looked at other places and just said you all have the material.
    Now it turns out that almost everybody has some type of
    material, and we have a program that we are pleased with that
    has evolved since that conference and has begun to provide
    assistance in a variety of places for the protection of that
    type of radiological material.
        We also believe that, as I mentioned earlier, the
    acceleration and expansion of our programs in Russia is timely
    and important. We are very pleased. We think the overall time
    frame that we began with a couple of years ago since September
    11--we will be able to reduce by maybe as much as 2 years the
    work there. A lot of that is a function not of money but of
    absorption. Those are priorities as well, so those are among
    the things that we are working on.
        Senator Reed. Thank you, Mr. Secretary, very much. Thank
    you.
        Chairman Warner. Thank you, Senator.
        Senator Pryor.
        Senator Pryor. Thank you, Mr. Chairman, and thank you, Mr.
    Secretary, for being here today. This discussion has been very
    interesting. Let me back up just for a second. Is it fair to
    say that the DOE has the Nation's best and perhaps the world's
    best experts on nuclear technology? Is that fair to say?
        Secretary Abraham. Certainly there is a lot of tremendous
    technology expertise in the DOE at the laboratories.
        Senator Pryor. Part of your responsibility is the
    stewardship of the Nation's nuclear weapons and to maintain
    technical and analytical expertise in evaluating nuclear
    weapons, nuclear development, and nuclear weapons capability.
    Is that fair to say?
        Secretary Abraham. That is part of the role, yes it is.
        Senator Pryor. As part of that, I assume the DOE has a wide
    range of sub-specialities of expertise when it comes to nuclear
    weapons issues. Let me get to my question, because I just have
    a concern. It is a nagging question that I have had for some
    time, and I would like to get your thoughts on it. When you
    look at the October 2002 National Intelligence Estimate (NIE),
    it appears to me, in looking at it, when that document is
    discussing the aluminum tubes in Iraq, there were so many news
    stories about it, et cetera, and there was a lot of discussion
    in this committee about that, a lot of discussion behind closed
    doors about that.
        It appears to me that basically the DOE's analysis, input,
    and thoughts on those were virtually relegated just to a
    footnote, and that you did not actually agree, the Department
    did not actually agree, with really the conclusions in the
    document. There was a footnote to the effect that maybe you all
    had a differing view of that. I would like to hear your
    comments and your thoughts about how the NIE came to be written
    that way and what input you had in that process. I do not mean
    you personally.
        Secretary Abraham. The DOE participated along with a number
    of other agencies in the assessment of Iraq's programs. That
    assessment was based on the intelligence that had been
    collected. One of the issues is exactly the aluminum tube issue
    that you have referenced. We had a different view, as has been
    noted in the report, from some of the other agencies. I do not
    think we were the only agency that had a different view, and
    how it was entered into the record should not be interpreted to
    mean that there was not a full discussion of that issue. As I
    understand it, we encouraged the experts from our shop who
    participated to be very candid and strong in the sort of
    statements they made in support of their position.
        There were a lot of other issues though that were assessed,
    not just the aluminum tubes. The attempts of the Iraqi
    Government to acquire magnets, high-speed balancing machines,
    machine tools, and a variety of other pieces of information
    went into the overall assessment, which our Department's
    experts agreed with. That is the overall assessment of the
    state of play and the intent of the Iraqi regime. We did not
    agree with the specific issue that related to the tubes.
        Senator Pryor. As I understand the difference with regard
    to the aluminum tubes, your experts felt like these tubes were
    Italian-made Mindusa 81 rockets or something very similar to
    that.
        Secretary Abraham. Too long and too thick I think is the--
    --
        Senator Pryor. What was that?
        Secretary Abraham. I said, too long and too thick was the--
    --
        Senator Pryor. But very close to that, as I understand it,
    whereas some of the other agencies' experts, they felt like the
    tubes may have actually been used in the centrifuge to enrich
    uranium. Am I understanding that correctly?
        Secretary Abraham. Yes. As I said, I think our
    interpretation of the length and thickness of the tubes was
    that they would not be compatible with the sort of enrichment
    process that would be involved.
        Senator Pryor. Knowing what we know today, your experts
    were right about that. Is that right?
        Secretary Abraham. It was their conclusion then and remains
    that conclusion that these tubes were not appropriate for
    casing for an enrichment centrifuge.
        Senator Pryor. Right. As I understand it, though, they hit
    the mark when they made the analysis that these tubes were more
    just for conventional rockets rather than----
        Secretary Abraham. I believe they were right.
        Senator Pryor. That is my impression as well. Again, not to
    get too much into the process of how the NIE comes to be, but
    it sounds like while you had some input, at the end of the
    process, at the end of the day, your views were the minority
    view, and it was just footnoted.
        Secretary Abraham. On the issue that related to the
    aluminum tubes, it was the minority view. These people are
    experts. I would not dream of trying to change or influence
    their assessment. They are very good at that. Their assessment
    of the tubes was that they were not consistent with what would
    be used for enrichment. Their assessment of the overall status
    of the Iraqi program of what they were doing was consistent
    with the NIE's overall conclusion reached in that review.
        Senator Pryor. I guess my next question is, in your view,
    given the fact that we do these intelligence estimates
    periodically, do you need help in some way in correcting the
    situation, or maybe--I guess what I am asking is, do you feel
    like you have enough input there during the process?
        Secretary Abraham. Yes, I do. Again, we are talking about a
    group of experts who often have differing opinions on
    information made available to them. It certainly was my
    impression at the time that our people made their case very
    strongly on all aspects, not just on the tubes but on their
    overall conclusion based on the intelligence available to them.
    We urged them to do that, to make their disagreements with
    other people clear and to advocate their positions strongly, as
    well as their agreements.
        Senator Pryor. That is all the time I have, Mr. Chairman.
    Thank you.
        Chairman Warner. Thank you very much, Senator.
        Senator Clinton.
        Senator Clinton. Thank you, Mr. Chairman, and thank you,
    Mr. Secretary. I have a series of questions on a variety of
    issues, and I want to follow up on a line of questioning
    concerning our efforts on nonproliferation. As I understand it,
    the NNSA has a real expertise in nonproliferation verification
    research and is responsible for the development of remote and
    ground-based sensing and detection technologies that are
    capable of detecting nuclear weapons and materials at borders,
    airports, and elsewhere. In fact, I think it is fair to say
    that the technology work the NNSA does represents the bulk of
    the research in our Government on nuclear detection technology
    development.
        That is why I was concerned to see that the budget for this
    work in fiscal year 2005 is $111.5 million, which represents an
    11.6 percent reduction from fiscal year 2004. I cannot imagine
    any more important work than our efforts to understand how to
    detect weapons-grade materials, and to me this reduction seems
    short-sighted. In your opinion, is the NNSA doing everything
    possible to address this problem, and what are the unfunded
    requirements for detection technologies?
        Secretary Abraham. It is, first of all, fair to say that
    they do excellent work, and I think you are exactly right. It
    is my understanding that some of these program responsibilities
    were moved out of our Department, which is what accounts for
    the reduction in funding, as part of the Department of Homeland
    Security's (DHS) emergence. Some of that responsibility for the
    research has moved over there, which is what accounts for the
    change in funding.
        Now, I have a lot of experts sitting here who probably know
    the numbers better than I do, but that is my understanding of
    the reason that that's changed.
        Senator Clinton. I would appreciate having some written
    response to this, because I am frankly concerned about moving
    high-level technology research into the DHS, and I do not know
    that they are up-to-speed or have the capacity, interaction,
    and synergy that goes on in DOE. I think we really need to take
    a hard look at this, Mr. Chairman, because there is not
    anything more important than having the very best that we can
    have doing this research and developing this technology.
        So I would appreciate some written response and maybe a
    trail that can lead us to find out who we can ask at the DHS,
    because they are having trouble getting up and going on a range
    of issues that are under their umbrella, and this is one that I
    do not think belongs there, if indeed that is where it has been
    moved.
        Secretary Abraham. We will be happy to provide a response.
        [The information referred to follows:]

        Our budget request for the Nonproliferation and Verification
    Research & Development (R&D) Program is, in fact, $16 million higher
    than our request in fiscal year 2004. This reflects, in particular, the
    need to begin the development of new space-based nuclear explosion
    monitoring sensors to replace the capability on the Defense Support
    Program satellites which are due to be retired before the end of the
    decade.
        In the appropriation for fiscal year 2004, Congress added $29.5
    million to our request for the R&D program for critical research in
    nuclear and radiological national security and for particular projects
    important to the members. Our fiscal year 2005 budget request was
    formulated last fall, before we knew the details of the congressional
    action on our fiscal year 2004 request. Consequently, that result did
    not figure into the baseline level for the fiscal year 2005 funding
    request. While we appreciate the confidence expressed by Congress in
    the importance of our R&D program, we have not presumed that the
    committee meant for this amount to be added to our base request in the
    President's budget.
        With regard to the transfer of part of our R&D program to the
    Department of Homeland Security during fiscal year 2003, we understand
    that the challenges are enormous in the first year of startup, in
    maintaining the quality of the R&D programs that we were required to
    transfer to them. We have provided the capabilities of our National
    Laboratories and worked side-by-side with the Department of Homeland
    Security to ensure the best outcome to both our efforts.
        In the Department of Energy, we will continue to work on advancing
    national capabilities to detect proliferation activity, and provide the
    underlying science and technology for nonproliferation and national
    security missions, which many agencies including the Department of
    Homeland Security will draw upon. I appreciate your comments
    recognizing that the combination of the understanding of nuclear
    technology from our nuclear weapon and nonproliferation program
    responsibilities gives the Department of Energy a unique perspective
    and programmatic synergy to address these nonproliferation research
    problems.

        Senator Clinton. Mr. Secretary, I am also impressed by the
    recently announced task force that you have compiled to work
    with the IAEA to locate, identify, and assess the risk of RDDs.
    I think you referred to it earlier in responding to a question.
    From our information, it is having considerable success. It is
    creating a kind of global commitment to this, and we are making
    some progress.
        What is not being addressed is the highly enriched uranium
    (HEU) and weapons-grade plutonium that exists outside of Russia
    and the Former Soviet Union (FSU). Would you support an effort
    similar to the RDD Task Force to locate, identify, assess the
    risk, and secure as appropriate HEU and plutonium worldwide? I
    certainly congratulate you on what has been accomplished in
    Libya. I was a little bit concerned that we are sending some of
    the material back to Russia. That does not give me a lot of
    confidence at this moment, because I am not yet sure that we
    are doing everything we need to do there, but what about this
    idea of setting up a comparable task force?
        Secretary Abraham. I think a global cleanout of this kind
    of material is very wise and should be a very high priority. I
    referenced earlier this effort we have been making on an ad hoc
    basis, Mr. Chairman. There is U.S. origin fuel that is out in
    the world and needs to be returned. We now are going to be
    consolidating that effort, which had been under the EM division
    of the DOE. We are going to consolidate that and integrate that
    into this program that is ongoing in the nonproliferation
    division of the NNSA, because these should all be housed in one
    place. But there is a lot of U.S. source fuel.
        The Russian source fuel I mention, it goes back, because it
    is the Russians' fuel. Obviously their ownership rights dictate
    their return, but there is also fuel that has an origin that is
    neither Russian or American. This past week I had an
    opportunity to talk at some length about this with Director
    General ElBaradei of the IAEA, because this is a priority that
    he, I think, likewise shares, and we in fact talked about how
    we might put together a multilateral effort to do this.
        I think it is a serious threat, and whether it is a DOE
    task force or DOE-led task force, or it is an IAEA program, I
    would think that it would be very timely.
        Senator Clinton. Do you need legislative authority or any
    additional appropriated authority to do this?
        Secretary Abraham. I do not think we do. I am looking over
    at our folks here. I do not think we would need that to get it
    started, but I think it is a fair question for the record that
    we might want to get back to the committee on.
        [The information referred to follows:]

        In response to Senator Clinton's inquiry about whether DOE requires
    additional legislative authority to carry out global cleanout, the DOE
    has no need for additional legislative authority.

        Senator Clinton. It might very well be something we
    consider in the authorizing process, because I really applaud
    you for what you have done on RDDs. I think this is exactly the
    direction we need to be moving, and I would like to support you
    in this other area.
        On a more provincial basis, but one that I think of as very
    important, last summer, Mr. Secretary, you wrote to Congress
    asking for support for legislation to reclassify certain high-
    level radioactive waste incidental to reprocessing. I opposed
    that legislation because I believed that it would result in
    more high-level waste being left at the West Valley site in New
    York. I think it would also have the similar impact in
    Washington, South Carolina, Idaho, and elsewhere.
        The language was ultimately not included in any
    appropriations bill, but I understand that the DOE may be
    pressing for this legislation again. Is that correct?
        Secretary Abraham. Just to step back a moment, the issue
    that we have is this. Throughout our complex, of course, the
    results, the remainder of the work that was done during the
    Cold War and the weapons programs, and one of the issues that
    we have been wrestling with is the disposition of materials
    within tanks that are the result of reprocessing. That material
    is not of one composition. The material in these tanks is of
    multiple types of composition, some of it obviously of critical
    urgent need for remediation, high-level waste, and other waste
    whose radioactivity level does not meet the same standard.
        We believe and have felt that the DOE had the authority to
    differentiate the classification of the composition of these
    tanks, but a district court ruling in Idaho has raised
    questions about whether that authority exists or the extent to
    which it exists. So in this year's budget, just to put it in
    perspective, we have fenced about $350 million of money that
    was going to be spent on the remediation of what is probably
    over time about a $50 billion program. The $350 million we were
    going to spend this year on that program is kind of on hold
    until we can resolve whether or not there is such authority. We
    need to clarify the legal authority.
        We believe that the DOE does have the ability to safely and
    accurately differentiate between radioactivity levels, and
    therefore, the disposition of the materials in these tanks. We
    are talking with various States, and we hope that maybe we can
    come to a resolution, because the longer we put this off, if we
    do not spend that money, if we do not start down this road, the
    more the risk grows in these communities.
        Senator Clinton. Mr. Secretary, could I have your
    commitment that you would consult with New York State and also
    with my office as you proceed with this? Because it is my
    understanding that New York at least has not been brought into
    these conversations.
        Secretary Abraham. We will make sure that we keep New York
    informed. At this point, I am not sure whether there will be a
    legislative solution that works, but obviously for us to
    proceed there is going to need to be legislative action, and
    obviously all the members will be involved at some point, and
    we will keep you apprised of where the status is.
        Senator Clinton. And also the State, too.
        Secretary Abraham. Okay.
        Senator Clinton. Thank you. Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator.
        Senator Bill Nelson.
        Senator Bill Nelson. Thank you, Mr. Chairman. You have the
    little bee-bee there right by you, so why don't you tell us, is
    DOE committed to support the NIF so that the goal of ignition
    can be once again no later than 2010?
        Secretary Abraham. Yes. We are committed to that goal. We
    recognize how important achieving it is to Congress, and it is
    important to us. Mr. Chairman, I did bring this today, I
    mentioned it to you yesterday, what will be the target of the
    NIF. Maybe someone could get it up to the head table if you all
    wanted to look, and let me try to explain quickly, and then I
    know you have other questions.
        One of the challenges which this whole process presents to
    us, of course, like many of the things the DOE is forced to
    work on, is doing things that were unthinkable, never before
    attempted scientific achievements. What we will be doing when
    this NIF is completed and all the 192 lasers are functioning is
    to shoot effectively 192 laser beams at the small red bee-bee
    in the middle of that glass container and hit it
    simultaneously.
        To give a sense of this, I was informed yesterday that the
    power that would be involved in that moment of contact would
    exceed all the power production at all United States
    electricity generation facilities at one time. We have to hit
    that bee-bee, and the challenge which caused us to have pause
    in terms of the time frame was that not only do we have to hit
    that tiny target, but we actually have to also inject inside of
    that target deuterium and tritium so that we can measure the
    impact of this process when this laser shot takes place.
        Now, how to get those gases into that target has been a
    real challenge for us, and we had decided or believed that a
    diffusion approach, that is, to freeze the substances and to
    try to, effectively through diffusion, inject them into the
    bee-bee--was the preferred course. The problem is that would
    take a lot more time, and that is where the 2014 time frame
    emerged for discussion.
        We have concluded, however, that the use of a fill tube
    approach will, although it is a little riskier, be an approach
    that can succeed, and so it is our belief that that approach
    can be successful. We have conducted other forms of
    experimentation that indicate we can do that without disrupting
    the physics that are involved, and so that allows us to move
    back to a time table that I think we and Congress have focused
    on and believe needs to be met.
        Senator Bill Nelson. So that is the plan for bringing it
    back to 2010?
        Secretary Abraham. Right.
        Senator Bill Nelson. Okay. In the NNSA, nonproliferation
    verification R&D account, the budget for this work in 2005 is
    $111 million, which represents an 11-percent reduction from
    2004. Given the importance of this work and the technical
    challenges of detection, particularly the technical challenges
    of detection of weapons-grade materials, I want to question
    this reduction in funding.
        We have some of this detection stuff in my State, so what I
    need to know is, is the NNSA going to do everything possible to
    address this problem, and what unfunded requirements are there
    for detection technologies?
        Secretary Abraham. As I indicated earlier, Senator, the
    reason that this reduction appears is because some of the
    programs which had been in our Department in terms of this R&D
    have been moved to the DHS, and that accounts for the
    difference. We would be happy to provide the committee, as I
    mentioned a little earlier, with some specific information that
    would allow the committee to monitor how those parts of the
    program are being handled, or where they are being handled,
    which office at DHS is responsible, for your consideration.
        Senator Sessions [presiding]. Thank you, Senator Nelson.
        Senator Clinton. Mr. Chairman, would you yield for just a
    second?
        Senator Sessions. Yes.
        Senator Clinton. Senator Nelson is concerned about the same
    issue I am concerned about; what has happened to the NNSA
    budget. It is our information, Mr. Secretary, that the chemical
    and biological weapons detectors were moved to DHS, but not the
    nuclear detectors, and that the money for the nuclear detection
    program has been cut. We really need to clarify this, because
    obviously this is a matter of some concern to a number of us,
    and I appreciate the courtesy, Mr. Chairman.
        Senator Sessions. Thank you, Senator Clinton.
        Secretary Abraham. I will say for the record I do think we
    have a comment to add, but I think probably the details are
    beyond what I can give you right now.
        Senator Clinton. Thank you.
        Secretary Abraham. Thank you.
        Senator Sessions. Mr. Secretary, it is a delight to have
    you back in the Senate, and you are a valued colleague and did
    a tremendous job here. I for one want to express my
    appreciation, first, that you have received the award for the
    most efficient and productive department in the Federal
    Government from OMB, is that correct?
        Secretary Abraham. Right.
        Senator Sessions. I believe every Cabinet agency needs to
    focus intensely on efficiency and productivity. In the long
    run, that saves us tremendous sums of money. It builds on
    itself year after year when you are mismanaging or not
    utilizing the resources wisely, so I am glad to see that a
    Senator can be a manager. I think that is something you should
    be proud of, and I really do think all of our Cabinet agencies
    ought to do better, and this Senate should do better frankly
    with the way we manage money.
        I understand from your strategic plan that three of the
    DOE's largest sites, the Hanford site in Washington, the Idaho
    National Laboratory, and the Savannah River site in South
    Carolina, are expected to be cleaned up as much as 35 years
    earlier than originally planned. Could you describe for the
    committee how this budget request that spikes the expenditure
    this year up to about $7.5 billion, how that is important, or
    if it is? Is that making a difference in your cleanup schedule?
        Secretary Abraham. Well, it is. Here is the state of play
    that we built on. When we took office, I was briefed by the EM
    program on the plans for cleaning up these sites. The time
    frame to me seemed remarkably long, 70, 80 years. Obviously if
    you are in those communities that is not a very desirable
    outcome.
        Yet we had before us three examples of cleanup efforts that
    were going much faster, that had been initiated before our
    arrival by the previous administration. One was in Rocky Flats,
    one in Fernald, and the other in Mound--the latter two both in
    Ohio--were going quickly as well. Instead of this kind of slow-
    paced approach, we were moving to 10-year time frames for
    cleanup, and Rocky Flats is probably the best example. We are
    staying on that track. About $600 million of the $7.5 billion
    you referenced is to make sure we keep Rocky Flats on track to
    be finished by 2006. We are going to get there. It is a huge
    site, totally finished in 10 years.
        When the cleanup program was expedited there, the plan had
    been an 80-year plan at $37 billion. It will be done in 10
    years from that time frame at about $7 billion. The same
    philosophy that really underscored the Rocky Flats approach is
    how we are trying to approach Hanford and the other sites as
    well, so that in the lifetime of people alive today, these
    sites can be finished.
        The way we are accomplishing it is to transition from an
    approach of essentially managing risk to an approach of
    reducing it, and in that sense what I am talking about really
    is making positive significant process in the cleanup, year to
    year to year. That means spending more money at the beginning
    of this process than was otherwise planned, but it means once
    you begin to reduce the footprint, the overall costs for
    security, maintenance, and so on start to be reduced, and we
    start reducing risk instead of just managing it over a long
    period of time. That is how we intend to approach the entire
    complex. Happily, in virtually every case, the States have
    agreed to and approved these accelerated cleanup programs.
        Senator Sessions. That is good news that that can be done,
    and I hope the taxpayers in the end will find that efficient as
    well as, of course, improving the environment.
        Mr. Secretary, I am not going to get into an argument over
    energy prices, but I, like a lot of Americans, am concerned
    about them. I know some have complained about what has
    happened, but I firmly believe that the administration and you
    are correct to believe we should produce more oil and gas in
    Alaska, that we could produce more in the United States, that
    we could produce more offshore, and that we could expand
    nuclear power. Frequently the very people who complain about
    high prices do not take responsibility for the fact that they
    have forced us to go overseas to get our energy sources, and as
    a result, have allowed us to be subject to the Organization of
    the Petroleum Exporting Countries (OPEC) cartel and pricing. It
    is frustrating to me. I think if we get busy on it, we can make
    some progress, but I believe we are going to need to have, as
    you have supported, increased nuclear power--it is at 20
    percent now--to create electricity. Increased natural gas,
    which is peaking utilization for electricity all over America,
    and I believe the Alaska Reserves, which are very substantial,
    ought to be brought online and could be brought online. We
    could produce gas safely there. Nobody seems to be worrying
    about the Venezuelans producing it in estuaries or in the
    Caspian Sea or other places. We buy it from them. Why don't we
    buy it from American producers? I think if we produce more, we
    will see some impact on our cost.
        Proliferation is a matter of great concern. We have talked
    about that a lot. It has been talk, talk, talk for quite a
    number of years in Congress and by politicians, but is it not a
    fact that President Bush's action in leading the efforts on the
    war on terrorism made some real progress for us? In other
    words, we have Pakistan now, we have Iran perhaps, and Libya
    has come in. Would you just point out that since we have taken
    action against terrorism and challenged some countries to stand
    up and reject the pursuit of nuclear weaponry that we have made
    real progress in just the last few months?
        Secretary Abraham. We have, and I think the President's
    Proliferation Security Initiative (PSI) has played a major role
    as well. It was a major factor in the interdiction of shipments
    that were intended for Libya last fall. I think that probably
    was the pivotal moment in terms of the decisionmaking in Libya
    to relinquish their WMD program.
        The President has also been successful in launching the
    Global Partnership Initiative, which has gotten other G-8
    countries to agree to support these proliferation programs
    financially. It is not just the United States involved in this
    effort, but $10 billion over a 10-year period will be coming
    from the other members of the G-8. With those dollars we will
    be able to do a lot more of the security work that we talked
    about here today, so that it is not just a U.S. responsibility,
    but it helps us to meet the overall costs of these programs.
        I think the actions that we have taken on a number of
    fronts have worked together very effectively, and there is a
    lot more to do.
        Senator Sessions. Think of Abdul Kahn in Pakistan, who has
    confessed to proliferating to North Korea, Libya, and Iran.
    Iran is now negotiating to allow nuclear inspectors from the
    International Atomic Energy Agency to come in and evaluate
    their nuclear facilities. That could give us more confidence
    than we have today in how they are doing. Iraq, of course, has
    always wanted to have a nuclear power, and they now have been
    stopped in that.
        I just think in the last few months more has been
    accomplished than we have given ourselves credit for, and I
    believe the actions and the courage of President Bush has been
    the key to that.
        Thank you, Mr. Chairman.
        Chairman Warner [presiding]. Thank you very much. We will
    continue our hearing with a second round here. Let us talk
    about the Modern Pit Facility (MPF). I want the question in the
    record, even though the answer is very obvious. We are the only
    nation with a nuclear capability, but we do not have a MPF
    capability. So if for any reason in the testing of our systems
    we found out that there was an aging defect in a whole class of
    weapons, what would you do today?
        Secretary Abraham. As the chairman knows, we have finally
    at Los Alamos been successful in the production of a
    certifiable pit. It is for the W-88. It is going to take a
    while to actually go through a certification process. The pit
    production facility is one which would be needed under any
    circumstance.
        Chairman Warner. I share that view.
        Secretary Abraham. Simply because the aging of the
    stockpile will require us at some point to have the capability
    of replacing primaries, and so that's--I would be happy to
    submit a chart to the committee that would compare----
        Chairman Warner. This record has adequate information in
    it, because I support this new facility.
        Let us talk about the MOX program. It is designed to
    reprocess surplus weapons-grade plutonium from the United
    States and Russia into commercial nuclear fuel. There is a
    delay in U.S. construction to ensure that the United States and
    Russian programs proceed at a parallel pace. The MOX program is
    being delayed for 1 year and may face additional delays,
    because the United States and Russia have been unable to reach
    an agreement on liability issues for U.S. contractors
    associated with the project.
        Is the U.S. making progress in reaching agreement with
    Russia? If not, what are you going to do?
        Secretary Abraham. We are optimistic that ultimately we can
    resolve this issue. The sequence of events is very simple. In
    the initial process of the development of this plutonium
    disposition program, we had an agreement which had been entered
    into to cover basically the phase of planning and design. We
    are now at a point when we have agreement on both sides as to
    the design, disposition pathway, and development, as you said,
    to convert the plutonium into a fuel called MOX.
        We now have to have a new agreement that would cover the
    actual development of the construction phase of this process in
    the United States, but also to cover this program on the
    Russian side. We are of the view that the liability provisions
    that have governed the Cooperative Threat Reduction (CTR)
    agreement ought to apply to this program. The liability
    provisions there are ones that protect this government, its
    contractors, people we pay that will be involved in this
    process, and we have not been able to get an agreement to use
    the CTR language for the MOX program.
        The Russian Federation is, of course, operating under the
    CTR. It is my understanding that they have certainly indicated
    to us that they plan to submit the CTR ultimately to the Duma
    for ratification, and we await how they proceed on that as a
    key step. There has been this belief, and we share it, that the
    programs should proceed on parallel tracks, not have the United
    States program move ahead without the Russian program. So we
    are optimistic still, but it is still taking a lot of time to
    come to agreement.
        Chairman Warner. Last year, the administration requested
    and received authority to use DOE defense nuclear
    nonproliferation funds in countries outside the FSU. Do you
    expect to use this authority in 2004? If so, where and for what
    purpose?
        Secretary Abraham. Mr. Chairman, I think I might----
        Chairman Warner. Want that in closed session?
        Secretary Abraham. Well, or take it for the record if I
    could. Obviously we talked earlier about some of the work we
    are doing on the RDD front, the radiological materials there
    that might be used for a dirty bomb. I know that some of that
    work is conducted outside of both Russia and the FSU. I am not
    sure if that is the question you are asking, so let me, if I
    could, respond specifically for the record on it.
        [The information referred to follows:]

        The administration's support of addressing the global threat of
    proliferation of WMD both in states of the FSU and around the world is
    reflected in the President's fiscal year 2005 budget submission, which
    requests $1.35 billion for this work. For more than a decade, the DOE,
    and now through its NNSA, has played a central role in the United
    States' effort to improve the security of under-secured nuclear
    warheads and weapons-usable nuclear materials in the Russian Federation
    and other independent states of the FSU. But the security of the United
    States, including the war on terrorism, urgently requires reducing the
    proliferation risk of nuclear, chemical, biological, and radiological
    weapons and materials, warheads, technology, and expertise in countries
    beyond the borders of the FSU. NNSA's contribution to threat reduction
    activities include, for example, nuclear detection work at major
    transit/transportation hubs and ports in FSU states, Europe, Asia, and
    South America; traditional materials protection, control and accounting
    security upgrades in Eastern Europe, South Asia, and elsewhere where
    weapon-usable material is at risk to theft, diversion, or terrorists;
    and radiological security work, to counter the threat posed by
    smuggling of radioactive sources that can be used to make ``dirty
    bombs.''

        Chairman Warner. Senator Levin.
        Senator Levin. Thank you, Mr. Chairman. On the question of
    the MPF, you received last year, I believe, $10 million to
    continue design work and to complete the environmental impact
    statement for that facility, and you are requesting about $30
    million for this year to continue the design and the
    environmental impact statement. You have not made any decision,
    I understand, on the long-term size of the stockpile, which, of
    course, is----
        Secretary Abraham. A factor, yes.
        Senator Levin.--pretty critical. You are looking at
    designing a facility to make up to 500 pits a year, which would
    rival the Cold War pit manufacturing capability. But in the
    conference report for energy and water appropriations, it said
    that until the Stockpile Plan was submitted, it was premature
    to pursue further decisions regarding the MPF.
        So I guess the question is, what is the status? You need
    one, but what is the status?
        Secretary Abraham. We are still evaluating a couple of
    issues that need to be addressed. One is the stockpile size,
    which is a principal factor in this. Another major factor is
    the lifetime of the pit. We are trying to assess what that
    duration is. The range of assessments of the laboratories right
    now is a fairly wide range, and we are trying to become precise
    in that, because obviously the life cycle of the primary pit
    itself is a factor in how many one would ultimately require. So
    those are issues we are trying to resolve.
        Senator Levin. Has the DOD given you direction relative to
    the size of the stockpile that is going to be needed?
        Secretary Abraham. That is really part of this analysis
    that I mentioned in response to your earlier questions. We are
    working very hard to finish, and that is obviously the largest
    question, but the pit lifetime, the start date for quantity
    production, are all also ingredients in terms of what the size
    would be.
        Senator Levin. For the out-year budgets, what are you
    assuming in terms of the size of the stockpile that you are
    going to need to support?
        Secretary Abraham. Let me just check. It is the same size
    as in the last stockpile document from the President, so that
    would be the----
        Senator Levin. What is the number? Do you have a number?
        Secretary Abraham. Let me submit it for the record. I think
    I can get that to you quickly.
        [The information referred to follows:]

        The DOE fiscal year 2005 budget submittal was written in light of
    the ongoing joint DOE and DOD study to define the nuclear weapons
    stockpile to support deployments and response options.
        On April 21, 2004, Secretary Rumsfeld and I submitted the fiscal
    year 2004-2012 Nuclear Weapons Stockpile Memorandum to the President
    for his approval. The memorandum and proposed fiscal year 2004-2012
    Nuclear Weapons Stockpile Plan support the President's proposed level
    of 1,700 to 2,200 operationally deployed strategic nuclear weapons by
    2012. Once the President approves the fiscal year 2004-2012 Nuclear
    Weapons Stockpile Plan, revised nuclear weapons stockpile quantities
    and weapon projected active/inactive status will be available to report
    to Congress.
        The President's approval of the fiscal year 2004-2012 Nuclear
    Weapons Stockpile Plan is critical to completion of a required
    congressional report requested in H.R. Report 108-357. This report will
    discuss stockpile projections through the year 2012.

        Senator Levin. Okay. Because we now plan to reduce deployed
    strategic nuclear warheads to between 1,700 and 2,200 warheads
    by 2012, you are maintaining apparently something like 8,000
    nuclear warheads in varying degrees of readiness, with the
    exception of the W-62, which is a separate issue. That is a
    lot. That is a big cost. So by the DOD not giving you that
    number, you are maintaining a much larger number of warheads
    than presumably you are going to need to maintain as soon as we
    get that number. I am making a presumption here, but it seems
    to me----
        Secretary Abraham. Part of it will depend on the
    disposition strategy for warheads that we might then move to a
    retirement phase, and then we would go through obviously a cost
    associated with the retirement and dismantlement and
    disposition.
        Senator Levin. All right. If you could submit to us for the
    record then what assumption you are making relative to the
    inventory for the out years, it would be helpful.
        [The information referred to follows:]

        On April 21, 2004, Secretary Rumsfeld and I submitted the fiscal
    year 2004-2012 Nuclear Weapons Stockpile Memorandum to the President
    for his approval. The memorandum and proposed fiscal year 2004-2012
    Nuclear Weapons Stockpile Plan support the President's proposed level
    of 1,700 to 2,200 operationally deployed strategic nuclear weapons by
    2012. Once the President approves the fiscal year 2004-2012 Nuclear
    Weapons Stockpile Plan, revised nuclear weapons stockpile quantities
    and weapon projected active/inactive status will be available to report
    to Congress.
        The President's approval of the fiscal year 2004-2012 Nuclear
    Weapons Stockpile Plan is critical to completion of a required
    congressional report requested in H.R. Report 108-357. This report will
    discuss stockpile projections through the year 2012.
        In anticipation of lower stockpile levels to be approved by the
    President, DOE has already taken some actions such as reducing the size
    of the procurement of some components for the Life Extension Programs
    (LEPs) and other warhead alterations or modifications. It is worthwhile
    to note that the proposed Nuclear Weapons Stockpile Plan revalidates
    the need for the LEPs, but proposes to reduce each of them in quantity;
    cost savings due to a smaller stockpile will be reflected primarily in
    out-year budgets starting in the next decade.
        Currently, DOE has provided information to Congress that defines
    today's stockpile and currently-approved projections in documentation
    such as the Report to Congress: Strategic Force Structure Plan for
    Nuclear Weapons and Delivery Systems (November 2003); the fiscal year
    2005 Budget Submittal (February 2004); and, the fiscal year 2005-2009
    Stockpile Stewardship Plan (March 2004) that provides budgetary and
    quantitative information on the weapons being supported today in the
    stockpile. DOE also submitted classified Selected Acquisition Reports
    for the B61-7/11, W76, W80, and W87 LEPs to Congress in February 2004,
    with significant detail on scope, schedule, and cost. Updated budgetary
    information, based on the revised stockpile once approved by the
    President, will be prepared in support of the fiscal year 2006 Budget
    Submittal, the DOE preparation of the Future-Years Nuclear Security
    Program, and other reports requested by Congress.

        Senator Levin. I guess there is just one other question I
    had, Mr. Chairman, and that goes back to the RNEP program. We
    had a lot of confusion and I think some misinformation about
    the effects of using a RNEP when we discussed this last year,
    not necessarily from you, by the way. Misinformation and
    confusion did not necessarily come from a DOE source on that,
    but in general there was a great debate. We did not get hard
    estimates on that issue, fallout and deaths from the effect of
    a use of an earth penetrator.
        For instance, it is our understanding that if that
    penetrator were detonated several feet underground, perhaps the
    length of the missile itself, it actually could produce more,
    not less, fallout than the same weapon would produce if the
    detonation occurred in the air over a target. Now, I do not
    know whether that's true or not. Do you know whether that is
    true?
        Secretary Abraham. I do not know. I know that there was
    some speculation about whether it could be developed in a
    fashion as to eliminate fallout and collateral damage, and the
    administration has never, nor has this Department, ever
    indicted that that could be possible. As to whether it would
    be--I am not aware of any, but that does not mean that we could
    not--we may have some information. I will be happy to provide
    it if we do.
        Senator Levin. If you could get for us that estimate as to
    if the detonation occurred a few feet, perhaps the length of
    the missile, underground, what the level of that fallout would
    be----
        Secretary Abraham. If we have that, I will----
        [The information referred to follows:]

        The fallout from the buried burst would be similar to the fallout
    from a surface burst of the same yield. However, the military objective
    is to hold underground targets at risk, and if necessary defeat them.
    In order to achieve either objective with a shallow-buried nuclear
    weapon, one with about 30 times lower yield could be used. That would
    mean that the fallout from the lower yield, shallow-buried burst would
    produce the same effect on target, but produce a 10 times smaller
    fallout area than the higher yield surface burst required to achieve
    the same military effect.

        Senator Levin. It would be very helpful to us.
        Mr. Chairman, Senator Akaka was hoping to be here but he
    cannot make it, and I would appreciate his statement being made
    part of the record.
        Chairman Warner. Without objection. For any members who are
    unable--we have a number of committee meetings today, Mr.
    Secretary--to attend today who desire to put questions into the
    record, we will hold the record open to that purpose until
    close of business tomorrow night.
        Senator Levin. Thank you.
        [The prepared statement of Senator Akaka follows:]
                 Prepared Statement by Senator Daniel K. Akaka
        Thank you Mr. Chairman. It is always good to see our former
    colleague, Secretary Abraham. Aloha. I look forward to your testimony,
    Mr. Secretary, on the Department of Energy's (DOE) budget for nuclear
    weapons activities.
        Unfortunately, today we live in a world where governments and
    terrorists are seeking to develop and acquire weapons of mass
    destruction (WMD). I am deeply concerned that we are not doing enough
    to stop the potential flow of weapons and weapons materials to
    terrorist organizations. We are devoting more resources to developing
    new nuclear weapons, instead of securing nuclear material already in
    existence.
        The administration's plans to develop new weapons and modify old
    types of weapons will compromise U.S. security by undermining efforts
    to make worldwide cooperation on nonproliferation of nuclear and other
    WMD more effective.
        The first Bush administration halted work on nuclear weapons then
    under development and halted nuclear testing except for safety and
    reliability, effectively bringing work on new weapons types to a close.
        I believe this administration's nuclear initiatives are creating a
    new kind of arms race by expanding our weapons development programs.
        The United States pledged in the Nuclear Nonproliferation Treaty
    (NPT) ``to pursue negotiations in good faith on effective measures
    relating to cessation of the nuclear arms race at an early date and to
    nuclear disarmament.'' This is still a worthy objective.
        Last Friday, The New York Times reported that the U.S. is reviving
    efforts to increase our capability to analyze nuclear fallout if a bomb
    were exploded on our soil.
        This effort would allow us to attribute the weapon to a specific
    country or terrorist group by matching the fallout signature with what
    we know about the characteristics of foreign weapons. The aim of the
    project is to deter terrorists by letting them know we will be able to
    trace any attack back to them, and thus we will be able to retaliate.
    The existence of this project is an indicator of the seriousness of
    this threat. But it also leads me to question why we are not doing more
    to stop proliferation rather than spending our limited resources
    developing new weapons.
        Instead of beefing up nonproliferation efforts, the administration
    has requested $27.6 million for the Robust Nuclear Earth Penetrator
    (RNEP) for fiscal year 2005. The request would continue a study to
    modify an existing weapon to penetrate completely into the ground
    before detonating, increasing its ability to destroy buried targets.
    The RNEP study was initially projected to cost $45 million-$15 million
    a year for fiscal years 2003-2005. It is now projected to cost $71
    million. This is too much money to research a weapon that in many ways
    duplicates what conventional weapons can already do.
        Additionally, the budget request includes figures through fiscal
    year 2009 that total $484.7 million, and includes placeholders for both
    the development engineering and production engineering phases. This
    seems to indicate that the RNEP study is more than just a study, and is
    in fact being undertaken with the foregone conclusion that the weapon
    will go into development.
        The administration claims they need these weapons programs to
    increase deterrence from a new kind of threat. I do not believe
    developing these weapons will deter other nations, or terrorists. If
    other nations see the U.S. developing new nuclear weapons, they will
    believe they need new weapons for their security as well.
        We already know that terrorists are trying to acquire nuclear
    weapons. Director of Central Intelligence (DCI) George Tenet said so in
    his recent testimony before this committee: ``Mr. Chairman, I have
    consistently warned this committee of al Qaeda's interest in chemical,
    biological, radiological, and nuclear (CBRN) weapons. Acquiring these
    remains a ``religious obligation'' in bin Ladin's eyes, and al Qaeda
    and more than two dozen other terrorist groups are pursuing CBRN
    materials. . . .
        Over the last year, we have also seen an increase in the threat of
    more sophisticated CBRN. For this reason we take very seriously the
    threat of a CBRN attack. To further this point, over the weekend, the
    Associated Press reported that Osama Bin Ladin is already claiming to
    have nuclear weapons.
        We should not be providing more funds for new nuclear weapons
    studies when we are asking other countries to stop their own weapons
    development programs and trying to prevent terrorists from obtaining
    loose nukes.
        I hope Secretary Abraham can shed some light on how the
    administration plans to protect the American people by spending our
    limited resources developing new and unnecessary weapons instead of
    preventing terrorists from acquiring WMD of their own.

        Chairman Warner. May I say, Mr. Secretary, I think we have
    had an excellent hearing, and the enthusiasm with which you
    apply your talents to this challenging post come through very
    clearly with your views.
        We understand, Senator Pryor, you just returned. Do you
    want another question?
        Senator Pryor. I do not. Thank you, Mr. Chairman. You
    covered them all. Thank you.
        Chairman Warner. Thank you very much.
        Senator Levin. Mr. Chairman, there is just one final point
    that I want to make. What we have asked here for the record are
    not sort of your normal questions for the record. Some of the
    things that you are willing to supply we are going to need
    fairly promptly, so if you could make it really an effort, I
    know you run as efficient an agency as exists in this town.
        Secretary Abraham. After making the comments about our
    efficiency, we probably----
        Senator Levin. That is right. Now you are put in a really
    tough box here in that you are expected to produce with greater
    speed than any other agency.
        Secretary Abraham. Happily, the President's Management
    Agenda criteria does not include responsiveness to questions in
    hearings, but I will nonetheless make an exception to assure
    you that we will do our very best to do this promptly.
        Senator Levin. We will raise that with the Office of the
    President as to why that is not part of his criteria.
        Chairman Warner. You have been known to do that.
        Senator Levin. I am glad that my reputation precedes me.
        Chairman Warner. Thank you very much.
        [Questions for the record with answers supplied follow:]
                   Questions Submitted by Senator John Warner
                           national ignition facility
        1. Senator Warner. Secretary Abraham, please provide an update on
    the progress of the National Ignition Facility (NIF).
        Secretary Abraham. The NIF Project is 80 percent complete, and is
    performing in accordance with its cost and schedule baselines. The NIF
    project has demonstrated excellent management and technical
    performance. The first four of NIF's 192-laser beams were activated and
    commissioned in fiscal year 2003. Meeting this milestone required the
    installation, activation, and operation of at least one of every NIF
    component and system. Last summer, NIF laser scientists used these
    first four NIF beam lines to set records for infrared and green single
    beam laser energies. The NIF lasers have also demonstrated performance
    in ultraviolet laser energy that indicate the performance of the 192
    beam system will likely exceed design requirements when it is complete.
        The fiscal year 2005 budget will allow the project to continue to
    add beam lines. Current plans call for experiments to achieve the
    specific goal of ignition on NIF to begin in fiscal year 2009 with a
    central goal of achieving fusion ignition in fiscal year 2010.

        2. Senator Warner. Secretary Abraham, what is the NIF's value to
    the Science-Based Stockpile Stewardship Program?
        Secretary Abraham. The NIF will be the only facility capable of
    experimental conditions approaching temperatures and pressures found in
    nuclear weapons. This capability is essential for scientists and
    engineers at the weapons labs conducting studies and experiments to
    generate the data needed to continue to certify the safety, security,
    and reliability of the nuclear deterrent in the absence of underground
    nuclear testing.
        During September 2003, laser shots were completed supporting the
    first physics experiments on NIF. The Inertial Confinement Fusion
    Ignition and High Yield (ICF) Campaign will begin experiments for
    stockpile stewardship on the NIF this year, these experiments will
    directly support stockpile assessment and certification and will be
    used to validate Advanced Simulation and Computing (ASCI) simulation
    codes.

                            safeguards and security
        3. Senator Warner. Secretary Abraham, are you confident the
    facilities across the nuclear weapons complex will be able to meet the
    security requirements of the new Design Basis Threat (DBT) by the
    target date of 2006?
        Secretary Abraham. National Nuclear Security Agency (NNSA) sites
    have affirmed that they will be compliant with the new policy by the
    end of fiscal year 2006, assuming that there are no changes in the
    Adversary Capabilities List and subject to the availability of
    appropriated funding.
        A fiscal year 2004 reprogramming request of $55 million to address
    DBT requirements was approved in late June, and an additional $89
    million has been included in the President's fiscal year 2005 request
    to address DBT-related actions. Residual DBT funding issues will be
    considered as part of the fiscal year 2006 budget formulation which is
    ongoing.

        4. Senator Warner. Secretary Abraham, how would you respond to
    critics who claim that the new DBT is not necessary and that the
    Department of Energy (DOE) is requesting too much funding for
    safeguards and security?
        Secretary Abraham. Since September 11, the need to revise the DBT
    to better reflect newly-recognized realities has been apparent. The
    Department's DBT Policy is predicated on an interagency document titled
    ``The Postulated Threat to U.S. Nuclear Weapons Facilities and Other
    Selected Strategic Facilities'' (the Postulated Threat), developed
    jointly by the Department of Defense (DOD), DOE, the Nuclear Regulatory
    Commission (NRC), and the intelligence agencies. The Defense
    Intelligence Agency (DIA) published the new Postulated Threat document
    in January 2003, which reflects the post-September 11 increase of the
    potential terrorist threat. In turn, DOE used both the Postulated
    Threat, which provides a 10-year projection of the threat environment,
    and current intelligence estimates to develop our revised DBT Policy
    issued in May 2003.
        The Department has and continues to make every effort to ensure
    funding requests are justified and cost effective. The DBT is used as a
    graded, performance-based design guide and performance metric--that is,
    it specifies a threat force based upon the Postulated Threat and upon
    considerations of the attractiveness of the asset, the ability of the
    adversary to accomplish a given objective with the asset, the resources
    required by the adversary to accomplish a given objective, and the
    potential consequence of adversary success. The effectiveness of the
    protection system against the DBT-derived threat is evaluated using a
    suite of computer simulations, performance tests, and expert analysis
    and is compared to the minimum performance criterion that is also
    contained in the DBT. Alternative system designs are subjected to this
    methodology to determine the most cost effective solutions. The costs
    for security systems that emerge from this rigorous process are those
    that are presented in DOE budget requests.
        Furthermore, on September 8, 2003, I directed line managers and
    security professionals to emphasize finding or devising effective
    methods to make safeguards and security dollars go farther and to
    reduce the reliance on protective force manpower. To aid this effort, I
    directed the Office of Security and Safety Performance Assurance to
    assist the field in identifying and employing new security-related
    technologies that will allow our sites to improve their security
    postures while at the same time reducing their reliance on protective
    force manpower and their accompanying high funding requirements.
        Understanding that the DBT Policy is due to undergo an annual
    review in May 2004, I have directed the Office of Security and Safety
    Performance Assurance to accelerate its review and present
    recommendations for action by June 30, 2004.

        5. Senator Warner. Secretary Abraham, what will be the impact to
    security at the NNSA and defense emergency management facilities if the
    amount in the President's budget request for safeguards and security in
    fiscal year 2005 above the fiscal year 2004 appropriated levels is
    neither authorized nor appropriated?
        Secretary Abraham. If the fiscal year 2005 President's budget
    request for safeguards and security funding request is not supported by
    Congress, NNSA facilities will not have the resources needed to meet
    the revised DBT Implementation requirements by the end of fiscal year
    2006. Sites will continue to employ interim protection measures and
    compensatory measures, within available funding levels, to ensure that
    no special nuclear material or sensitive information is at risk.

                    price-anderson indemnification authority
        6. Senator Warner. Secretary Abraham, Price-Anderson authority is
    the indemnification protection for the DOE contractors who work on
    nuclear matters, and it expires at the end of this calendar year. What
    would the impact be on the DOE if the Price-Anderson indemnification
    authority is not extended beyond its expiration at the end of this
    calendar year?
        Secretary Abraham. In the event that the authority for the DOE to
    include Price-Anderson protection in new DOE contracts expires at the
    end of this year, the DOE will be forced to use other mechanisms to
    indemnify its contractors or be unable to carry out many of its
    critical missions. In 2002, the authority for the DOE to extend Price-
    Anderson protection to new DOE contractors expired. Prior to the
    inclusion of interim authority in the National Defense Authorization
    Act for Fiscal Year 2003, the DOE used Public Law 85-804 to indemnify
    its contractors.
        The existence of other indemnification mechanisms does not lessen
    the need to reauthorize the Price-Anderson Act in a comprehensive and
    long-term manner. The other indemnification mechanisms are less
    effective than Price-Anderson. Price-Anderson is the only source of
    indemnification that Congress designed specifically to assure prompt
    compensation to those who may be damaged by a nuclear incident without
    unnecessarily cumbersome litigation. The absence of Price-Anderson
    indemnification in a contract also denies the DOE the ability to exact
    civil or criminal penalties for a contractor's failure to comply with
    the DOE's nuclear safety regulations.
        The Energy Bill contains a very good provision to authorize the
    continued use of the Price-Anderson Act. The administration has
    expressed its support for this provision. The Department will continue
    to work with Congress to ensure enactment of this provision this year.

        7. Senator Warner. Secretary Abraham, are there any contracts which
    you anticipate will be signed in fiscal year 2005 which would be
    impacted by the expiration of Price-Anderson authority?
        Secretary Abraham. Yes, Senator. Approximately 24 major contract
    awards (valued in excess of $10 million), and many others of lesser
    value, to be awarded from December 31, 2004 (the current expiration of
    Price Anderson) and the end of fiscal year 2005 would be affected by
    the unavailability of Price-Anderson.
        Included in this group are contracts for the management and
    operation of: the Lawrence Berkeley National Laboratory; Los Alamos
    National Laboratory; and the Idaho National Engineering and
    Environmental Laboratory (INEEL). Each of these contracts will be
    competed during the subject time frame, and the competition may be
    affected by the unavailability of Price-Anderson.

                          secure transportation assets
        8. Senator Warner. Secretary Abraham, are there enough secure
    transportation assets, including trucks and security force personnel
    and equipment, to meet the growing demand for such assets from both
    DOE's Defense Programs and Environmental Management (EM)?
        Secretary Abraham. We recognized that there are ever-increasing
    demands on the secure transportation assets managed by NNSA's Office of
    Secure Transportation (OST). We are increasing the funding for this
    important activity in fiscal year 2004 and 2005 to accommodate the
    heavy workload associated with the large number of weapons retirements
    as well as the shipments of waste from EM sites at Hanford and Idaho.
    To ensure that the resources of the OST are used to accomplish the
    highest priority missions of the DOE, a Secure Transportation Advisory
    Board (STAB) has been established. This group, headed up by a senior
    military officer, meets with representatives from the Office of EM
    regularly to allocate shipping resources.
        The President's request for fiscal year 2005 will allow the NNSA to
    increase the agent workforce from its current posture of 230 to 290 by
    the end of the fiscal year.
        Congress has also recently approved an NNSA request to reprogram $5
    million to cover the early up front costs associated with the Hanford
    and Idaho campaigns.
                                     ______

                  Questions Submitted by Senator Wayne Allard
                        waste incidental to reprocessing
        9. Senator Allard. Secretary Abraham, on February 25, 2004,
    Assistant Secretary Roberson testified before the Strategic Forces
    Subcommittee and we had a good exchange on waste incidental to
    reprocessing (WIR). I would like to expand on this discussion with you.
    Please summarize the impacts of the Idaho District Court decision on
    the Department's cleanup plans at Savannah River, Hanford, and INEEL.
    If Congress does not resolve this issue, and if the court decision
    stands, what are the additional costs to the taxpayers for the cleanup
    at these sites?
        Secretary Abraham. There are cleanup actions at Savannah River,
    Hanford, and INEEL that the Department planned to conduct but can no
    longer conduct given the decision by the Idaho District Court. In
    general, these activities involve either closure of tanks at the three
    sites--which is predicated on classifying the residues as low-level
    waste--or activities to remove, stabilize and dispose of non-residue
    tank waste as low-level or transuranic (TRU) waste.
        The Department's baseline cost for implementing its accelerated
    cleanup plans at Washington, Idaho and South Carolina is $52 billion,
    if some of the waste can be managed as either low-level waste or TRU
    waste. This baseline reflects fairly advanced and detailed planning by
    DOE, although it undoubtedly will continue to evolve in light of new
    information.
        If the Department must treat all of the material as high-level
    waste, our very rough estimate, to get a sense of the order of
    magnitude of what would be involved, was that the cost would have
    increased to at least $138 billion. These figures, however, almost
    certainly dramatically underestimate what proceeding in this fashion
    would actually entail, because they do not include estimates for key
    aspects of what would be involved. These range from any kind of
    estimate for containers for the tanks themselves and associated
    hardware, to estimates of the direct transportation and disposal costs
    of this additional waste at the spent fuel repository, to estimates of
    the costs of delay that would ensue from the very complex logistics
    involved in transporting and disposing of this enormous additional
    amount of waste. Under this worst-case scenario:

             Retrieval of all tank reprocessing wastes and
            treatment for disposal in a geologic repository could require
            as much as $69 billion over the current Environmental
            Management program life-cycle cost baseline.
             As much as an additional $17 billion--and possibly
            more--would be required to exhume and dispose of tanks and
            associated components in a geologic repository.

        It is difficult to estimate the additional costs the Department
    would incur in terms of Federal repository fees. Under existing cleanup
    baselines, the Department expects to produce approximately 20,000
    canisters of high-level waste for disposal in a geologic repository;
    the fee associated with these canisters is estimated to be $10 billion.
    Under a scenario in which all tank reprocessing wastes currently
    anticipated to be removed and disposed of as low-level waste are
    instead prepared for disposal in a repository, the new baseline could
    approach 200,000 canisters. Thus, the fees could be significantly
    greater. This canister estimate does not include exhuming the tanks
    themselves nor associated piping, equipment, and concrete. At this
    time, the Department does not have estimates of the volumes for these
    additional materials that also might have needed to be placed in the
    repository.

        10. Senator Allard. Secretary Abraham, are there additional risks
    associated with a delay in cleanup?
        Secretary Abraham. Accelerated cleanup of tank wastes at the
    Savannah River Site, Hanford, and the Idaho National Engineering and
    Environmental Laboratory represents the greatest risk reduction
    activity in the Department of Energy's (DOE) entire cleanup program.
    Given that DOE cannot proceed with cleanup plans that were based on its
    waste classification order without legal clarification, at a minimum
    DOE will leave wastes in the tanks longer while it is awaiting that
    clarification.
        That wait quickly becomes decades longer if DOE has to make major
    changes to its disposal plans. For example, if all the tank waste has
    to go to a deep geologic repository, rough projections suggest that it
    would take four decades longer just to treat the waste for disposal--
    not taking into account the huge logistical effort that would be
    involved in transporting it, let alone what would be involved in
    transporting the tanks themselves.
        The longer the waste remains in the aging storage tanks, some of
    which are over 50 years old, the greater the risk of leaks.
        In addition, there is no advantage to the public health and safety
    from disposing of this material in a deep geologic repository rather
    than as DOE has planned, and dangers to workers increase significantly
    from following the repository approach. Specifically, DOE's analyses
    performed to support evaluation of alternatives for closure of tanks
    under the National Environmental Policy Act (NEPA) process show:

             Risks to the general public arising from radiation
            doses resulting from the waste after disposal remain
            essentially unchanged if waste residues are grouted in-place in
            the tanks, versus if the tanks are exhumed and disposed of in
            the repository.
             Risks to the general public arising from accidents
            associated with disposal activities likewise are essentially
            unchanged.
             Worker risks increase sevenfold if the tanks are
            exhumed, largely because of increased radiological exposure and
            industrial accidents associated with chopping up the almost 250
            large tanks and associated equipment.

        11. Senator Allard. Secretary Abraham, do the States have any say
    on the Department's cleanup plans at these sites?
        Secretary Abraham. Yes, the States do have a say on the
    Department's cleanup plans at these sites. DOE's plans to be agreed to
    by the States that host our DOE facilities, meet the requirements of
    Federal Facility Agreements among DOE, the States, and the
    Environmental Protection Agency (EPA), and comply with environmental
    laws under which the States have an explicit regulatory role.
        Closure of the Hanford and Idaho tanks will be considered in
    connection with the Resource Conservation and Recovery Act (RCRA).
    Closure of the Savannah River tanks will be considered in connection
    with the South Carolina-issued wastewater treatment operating permit to
    meet Clean Water Act limits. After closure of the tank structures,
    Hanford, Idaho, and Savannah River will then remediate tank farm soils
    under the Comprehensive Environmental Response, Compensation and
    Liability Act (CERCLA), during final closure.
        Under RCRA, States approve DOE closure and post-closure plans to
    verify compliance with RCRA. Closure plans detail DOE's steps to
    perform partial and/or final closure to meet closure performance
    standards. Post-closure plans describe the activities DOE is to perform
    and the frequency during the post-closure care period. These plans
    contain the information States need to determine whether the activities
    described in the plans comply with applicable requirements. In
    addition, the EPA and States concur on DOE CERCLA Records of Decision
    for remediation of tank farm soils as part of site closure activities.
    The EPA also has authority under CERCLA to require DOE to address and
    remediate, as appropriate, any future releases or threats of releases
    of radioactivity from the tank farms.
        In addition to State authority over tank closure activities, DOE
    sites have performed or are performing analyses under the National
    Environmental Policy Act to engage States and the public in decisions
    about tank closures.

        12. Senator Allard. Secretary Abraham, why did the Department in
    the fiscal year 2005 budget request propose to set aside $350 million
    for cleanup at these sites? Why didn't you just request the funds
    outright?
        Secretary Abraham. The Department's fiscal year 2005 budget request
    proposed to set aside $350 million for cleanup at these sites to inform
    Congress that legal uncertainty prevents the Department from executing
    certain cleanup activities at Hanford, Savannah River, and the Idaho
    National Engineering and Environmental Laboratory.
        If the Department had requested funding to proceed with these
    activities outright, it would have been making $100-plus million
    investments in facilities and technologies--with no confidence that it
    had the authority to classify the waste as it had done, and hence with
    no assurance that the waste form it spent this money creating had a
    disposal pathway. The Department concluded that it should only proceed
    with this cleanup work if either the lower court decision were
    overturned or if legislation were enacted affirming the Department's
    authority to classify these materials as waste incidental to
    reprocessing.

                            special exposure cohort
        13. Senator Allard. Secretary Abraham, many of the workers at Rocky
    Flats are concerned about the slow pace of the implementation of the
    Energy Employee Occupational Illness Compensation Program Act. Because
    of the delay, some of these workers have suggested that Rocky Flats be
    designated a Special Exposure Cohort facility. Given that the
    Department was unsuccessful in gaining congressional approval for
    reprogramming funding for accelerated implementation, how does the
    Department plan to address its backlog of claims?
        Secretary Abraham. We share your frustration with the pace of our
    implementation of the Part D program, caused in large part by our
    original underestimation of the number of applications we would
    receive. In 2001, DOE estimated that the Part D program would receive
    7,500 applications over 10 years, when in fact we have already received
    over 23,000 in the first 3 years.
        The $33.3 million fiscal year 2004 appropriations transfer request
    was part of the four-part comprehensive plan to eliminate the entire
    backlog. Of this request, $23.3 million has been approved. These funds
    will be used to ramp up operations to eliminate the backlog as soon as
    possible. However, the $10 million reduction will make it more
    difficult for the Department to meet its goal to eliminate the entire
    backlog of applications by the end of calendar year 2006.

                                worker benefits
        14. Senator Allard. Secretary Abraham, as you may know, cleanup at
    Rocky Flats has accelerated to the point that the facility may close a
    year early. While this is exciting news for the DOE and the contractor,
    many workers could find themselves out of a job much earlier than
    expected. In fact, some who would have qualified for a pension and
    medical benefits might not qualify if the site closes early. Will the
    DOE restore benefits to workers that would be lost if the site closes
    early?
        Secretary Abraham. The Department appreciates the committee's
    support of accelerated cleanup and is closely monitoring the situation
    at Rocky Flats. The Department is aware that early closure may impact
    pension and health benefits for some set of resident workers at our
    2006 closure sites. The Department, working with our contractors, will
    evaluate the possible impacts of early closure and measures to mitigate
    any such impacts.
                                     ______

                 Questions Submitted by Senator Daniel K. Akaka
                          radiological sources in iraq
        15. Senator Akaka. Secretary Abraham, I have been concerned about
    what we have done to secure radiological sources in Iraq. It is an
    issue I have raised with both Secretary Rumsfeld and yourself in the
    past. This problem extends beyond yellow cake and includes radioactive
    sources used for medical and industrial purposes--the basic ingredients
    of a dirty bomb. I understand that DOE has insisted that it has the
    responsibility for controlling all radiological material in Iraq. This
    resulted in several months of delay before DOE contractors were able to
    collect and store this material. When is DOE going to have a final plan
    ready for disposing of this material, and how certain are you that you
    can account for all these radioactive sources now in Iraq?
        Secretary Abraham. Under Project Maximus, DOE cooperated with the
    Department of Defense for the removal of approximately 1,000
    radiological sources from a former Iraqi nuclear research center. A
    total of 1,920 curies were evacuated to the United States. These
    sources are currently being processed at a secure DOE facility and are
    all expected to be disposed of by 2006.
        429 low-level sources were left behind at the former Iraqi nuclear
    research center. These sources constituted a total of 6 curies and do
    not meet DOE's threat criteria for a dirty bomb. The Department of
    Energy is currently coordinating with the Department of State to assist
    the Iraqi Ministry of Science and Technology to conduct additional
    search and recovery operations for radiological sources. This plan
    should be completed in 2005.

                          u.s. nuclear weapons program
        16. Senator Akaka. Secretary Abraham, I am concerned about the
    signal being sent to other nations by your proposal to develop new
    nuclear weapons. Why shouldn't other States see our actions as giving
    them the green light to pursue their own nuclear weapons program?
        Secretary Abraham. First, I would like to clarify that the United
    States has not embarked on the development of any new nuclear weapons.
    Indeed, we have not developed and fielded a new warhead for nearly 20
    years. At this stage, only concepts and feasibility studies are being
    considered. Any development of new types of nuclear weapons would
    require presidential approval and authorization and appropriation of
    funds by Congress.
        In fact, the United States has a solid track record of reducing its
    nuclear forces and nuclear weapons stockpile through both unilateral
    and bilateral initiatives. Our record should go far to negate the
    complaints of those who would highlight, often in a misleading way,
    certain activities in U.S. nuclear weapons R&D in order to call into
    question the U.S. commitment to nuclear nonproliferation. For this
    reason, I would like to highlight some of our key accomplishments.

             The United States has not enriched uranium for nuclear
            weapons since 1964, nor produced plutonium for nuclear weapons
            since 1998. We have no plans to produce these materials for
            weapons in the future.
             Since 1992, the United States has maintained a
            unilateral moratorium on nuclear testing.
             The administration's 2001 Nuclear Posture Review
            articulated a reduced reliance on nuclear forces in achieving
            U.S. national security objectives in light of a growing ability
            to achieve these objectives with conventional capabilities.

        When these achievements are viewed in light of the unparalleled
    U.S. commitment to nuclear nonproliferation efforts worldwide, it is
    clear that we have made remarkable progress toward reducing reliance on
    nuclear forces in our national security strategy and, overall, made the
    world a safer place.

                        robust nuclear earth penetrator
        17. Senator Akaka. Secretary Abraham, since the Robust Nuclear
    Earth Penetrator (RNEP) is designed to destroy deeply buried targets,
    it must rely on the accuracy of intelligence to be successful. Yet U.S.
    intelligence failed to detect the location of weapons of mass
    destruction (WMD) programs in Libya, Iran, and North Korea, and
    detected chemical, biological, and nuclear weapons programs in Iraq
    that apparently did not exist. Given that record, I wonder if the RNEP
    will be successful in deterring attacks from other countries or
    terrorists if they know our intelligence is not capable of pinpointing
    their location. What are the criteria that will be used to judge
    whether the weapon should go into development? Will it be based on
    technical feasibility alone?
        Secretary Abraham. NNSA and the DOD are currently engaged in a 6.2/
    2A study for the RNEP program. The RNEP program is a three year study
    to examine whether or not the B61 and B83, both existing warheads,
    could be modified through case hardening and other engineering changes
    to provide the United States with the ability to hold at risk a set of
    targets in hard rock geologies. This study effort being conducted at
    the weapons laboratories considers the following factors: nuclear
    safety, system trade offs (design and cost), technical risk analysis,
    life expectancy issues, R&D requirements, qualification and
    certification requirements, life cycle maintenance/logistics, delivery
    system/platform issues. The weapons labs and plants will also develop
    the workload and process development plans.
        The military services are responsible for preparing a draft concept
    of operations (CONOP) for RNEP, which would specify employment
    scenarios that discuss, among other things, minimum acceptable target
    location errors. The military services will use the CONOP as a basis to
    review and analyze the required military characteristics, stockpile to
    target sequence issues and develop the necessary plans for flight
    testing, maintenance, and logistics.
        Moving beyond the a 6.2/2A study will require approval of the
    Nuclear Weapons Council, the President, and Congress consistent with
    the requirements of section 3143 of the National Defense Authorization
    Act for Fiscal Year 2003.
                                     ______

              Question Submitted by Senator Hilary Rodham Clinton
                         department of energy's budget
        18. Senator Clinton. Secretary Abraham, the fiscal year 2004 budget
    for the DOE's Office of Electric Transmission and Distribution (OETD)
    has apparently been reduced by nearly 35 percent. This is especially
    ironic in light of the worst blackout in history in August 2003, and
    the recognition on both sides of the aisle that the aging, capacity-
    constrained electric power delivery infrastructure in the United States
    must be renewed and upgraded at the earliest possible time. The
    congressional conferees made it very clear in the Energy and Water
    Appropriations Conference Report that they expected OETD to ``. . .
    continue its high temperature superconductivity research and
    development at the requested level of $47,838,000.'' Despite this
    expectation, DOE has now cut the superconductivity budget to $32
    million. Beyond my concern with the impact of the cuts on the power
    grid, as a member of the Armed Services Committee, I am especially
    concerned about the negative impact these cuts could have on the
    military. High temperature superconductors are a unique class of
    materials that have the potential for revolutionizing a variety of
    military propulsion and directed energy weapon applications where high
    power density, as well as reduced size and weight at reasonable cost is
    absolutely essential. What are your plans for restoring the
    superconductivity budget to the level requested by the President for
    fiscal year 2004?
        Secretary Abraham. Superconductivity is a priority in modernizing
    and expanding America's electricity infrastructure. The President's
    National Energy Policy specifically recommended that the DOE expand
    research and development on superconductivity, and this was reflected
    in our fiscal year 2004 request of approximately $47.8 million for the
    High Temperature Superconductivity (HTS) program. However, of the total
    $69.5 million enacted for research and development in the OETD in
    fiscal year 2004, $25.8 million was provided for congressionally-
    directed projects, leaving $43.7 million to be allocated to four
    program areas: HTS; Transmission Reliability; Electric Distribution
    Transformation; and Energy Storage. This funding covers the
    superconductivity research as well as the development of tools and
    products for grid reliability. Many of the tools and technologies being
    deployed are helping to mitigate the potential for another blackout
    similar to that which impacted New York in August 2003. In fiscal year
    2004, the amount of non-earmarked funding available does not fully
    support the $47.8 million Departmental request level for HTS. The
    Department is working hard to minimize the impacts of Congress's fiscal
    year 2004 funding reduction while keeping critical programs
    operational.

        [Whereupon, at 11:31 a.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                            THURSDAY, MARCH 25, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

     THE ROLE OF U.S. NORTHERN COMMAND AND U.S. SPECIAL OPERATIONS COMMAND
          IN DEFENDING THE HOMELAND AND IN THE GLOBAL WAR ON TERRORISM

        The committee met, pursuant to notice, at 9:34 a.m. in room
    SH-216, Hart Senate Office Building, Senator James M. Inhofe,
    presiding.
        Committee members present: Senators Warner [chairman],
    Inhofe, Roberts, Allard, Collins, Levin, Lieberman, Reed, Bill
    Nelson, E. Benjamin Nelson, Clinton, and Pryor.
        Committee staff members present: Judith A. Ansley, staff
    director; and Leah Brewer, nominations and hearings clerk.
        Majority staff members present: Charles W. Alsup,
    professional staff member; Regina A. Dubey, research assistant;
    Gregory T. Kiley, professional staff member; Elaine A.
    McCusker, professional staff member; Paula J. Philbin,
    professional staff member; and Scott W. Stucky, general
    counsel.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; Evelyn N. Farkas, professional staff
    member; and Michael J. McCord, professional staff member.
        Staff assistants present: Sara R. Mareno, Nicholas W. West,
    and Pendred K. Wilson.
        Committee members' assistants present: John A. Bonsell,
    assistant to Senator Inhofe; Darren Dick, assistant to Senator
    Roberts; Jayson Roehl, assistant to Senator Allard; Derek J.
    Maurer, assistant to Senator Collins; Christine O. Hill,
    assistant to Senator Dole; Russell J. Thomasson, assistant to
    Senator Cornyn; Frederick M. Downey, assistant to Senator
    Lieberman; Elizabeth King, assistant to Senator Reed; William
    K. Sutey, assistant to Senator Bill Nelson; Eric Pierce,
    assistant to Senator Ben Nelson; Andrew Shapiro, assistant to
    Senator Clinton; and Randy Massanelli, assistant to Senator
    Pryor.

              OPENING STATEMENT OF SENATOR JAMES M. INHOFE

        Senator Inhofe. Our hearing will come to order. We have a
    chairman who is going to be a little bit late and so we will
    start without him. We are meeting today to receive testimony on
    the U.S. strategy and capabilities to combat terrorism and
    defend our homeland, in review of President Bush's defense
    budget request for fiscal year 2005 and the Future Years
    Defense Program (FYDP).
        I welcome our distinguished witnesses: Assistant Secretary
    of Defense for Special Operations and Low Intensity Conflict
    (ASD-SOLIC), Tom O'Connell; Assistant Secretary of Defense for
    Homeland Defense (ASD-HD), our previous colleague and good
    friend Paul McHale; Commander of the Northern Command
    (NORTHCOM), General Ralph Eberhart; and Commander of U.S.
    Special Operations Command (SOCOM), General Bryan Brown.
        I commend each of you for your leadership and the
    dedication that you have provided to our Nation. We appreciate
    you very much.
        Clearly, the events of September 11 have forever changed
    our sense of security and the manner in which we must organize
    and equip the Armed Forces to defend our Nation from the
    threats of the 21st century. Three years ago we did not have a
    Department of Homeland Security (DHS). We did not have an ASD-
    HD. We did not have a combatant command responsible for
    defending the United States homeland. Three years ago, SOCOM
    was primarily focused on supporting regional combatant
    commanders with Special Operations Forces (SOF). Today SOCOM
    has much-expanded responsibilities and is a key player in the
    global war on terrorism.
        Such complex organizational changes are not accomplished
    without hard work, trial and error, and dedicated leaders such
    as those before us today. A principal purpose of this hearing
    is to hear your reports on the progress you have made in
    establishing and reorienting your organizations to combat
    terrorism abroad and defend our Nation here at home.
        The men and women of our Armed Forces, together with the
    coalition of nations, have performed brilliantly in the post-
    September 11 world. Our Nation and the world are safer as a
    result of the professionalism and dedication of our military
    forces. But much remains to be done to protect our citizens,
    our Nation, and our allies from the threats of the 21st
    century, and in particular the scourge of terrorism.
        I have to say that I just returned from both Afghanistan
    and the northern part of Iraq and as far down as Djibouti. I
    have never been so impressed with the attitude and the
    commitment and the dedication of our troops. In light of some
    of the negative types of reporting around here, they are really
    holding up well, and you are all to be commended for your
    leadership.
        As we meet this morning, hundreds of thousands of our
    service members are engaged in military operations at home and
    abroad in the ongoing global war on terrorism. These brave men
    and women and their families deserve our continued support and
    they will get it. This committee's responsibility will continue
    to be to ensure that these troops remain the best equipped, the
    best trained, the best led, and the most capable forces in the
    world.
        In doing so, we must understand the challenges they face
    today and those they will face tomorrow. The insights of our
    witnesses today are an indispensable part of this process.
        We have a number of important issues to discuss with our
    witnesses this morning. Secretary O'Connell and General Brown,
    SOF have been at the forefront of our military operations in
    the global war on terrorism. The operational demands on SOCOM
    have been very high. The ability of SOCOM to sustain this high
    operational tempo (OPTEMPO) is of great importance, of great
    concern. This committee wants to ensure you have the people,
    the capabilities, and the resources to accomplish your many
    missions and prepare for the future, and we look forward to
    your assessment, on which we will base our decisions.
        While much attention is focused on operations in Iraq and
    Afghanistan, we must not lose sight of other challenges facing
    SOCOM. The Horn of Africa, where I just came back from, and
    other areas of sub-Saharan Africa, where I also have been in
    the last week, are unsettled and potential havens for
    terrorists. Narcotrafficking and terrorism in the Andean ridge
    and Central Asia is on the rise. The demand for U.S. SOF to
    help train coalition nations' Armed Forces has never been
    higher. The committee looks forward to your views on these
    issues.
        Secretary McHale and General Eberhart, you have both stood
    up entirely new organizations over the past 2 years. The office
    of the Assistant Secretary for Homeland Defense was established
    in February 2003 and NORTHCOM was established in October 2002,
    but did not achieve full operational capability until September
    11, 2003.
        Both organizations are focused on the critical missions of
    defending the United States homeland from attack. Your
    testimony on the progress you have made and what remains to be
    done are vital to the work of this committee. When you
    testified before this committee on April 8 last year, the
    chairman emphasized that you were the first incumbents in your
    respective positions, critical new positions, and that you were
    an integral part of the continuing transformation of our
    military that is so much broader and deeper than merely
    purchasing new weapons systems or using more advanced
    technology. You are an integral part of redefining how we think
    about the entire concept of defending this great country.
        The Department of Defense (DOD) has unique capabilities to
    contribute to the effort to secure our homeland, including
    providing assistance to State and local first responders in the
    event of future disasters, whether natural or manmade. You
    gentlemen represent the leadership that will bring those
    capabilities to bear when needed, working closely with the DHS
    and other Federal, State, and local authorities.
        We look forward to hearing your testimony regarding the
    DOD's ability to assist in homeland security, any factors that
    may inhibit your ability to provide such assistance, and how
    your organization, working with other combatant commanders and
    other agencies as a team, can defeat those who threaten us.
        Our witnesses today symbolize the unity of effort across
    the DOD to combat terrorism and defend our homeland from the
    threats of the 21st century. We thank you for your service and
    look forward to your testimony.
        Senator Levin.

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman. Let me join you in
    welcoming our witnesses this morning. There is just no way to
    overstate the significance of the subject of today's hearing.
    Combatting terrorism in the United States and abroad is the
    imperative of national security. Two weeks ago, the Director of
    Central Intelligence (DCI) told this committee that the al
    Qaeda leadership structure that we charted after September 11
    is seriously damaged, but that the group remains as committed
    as ever to attacking the U.S. homeland. Even catastrophic
    attacks on the scale of September 11 remain within al Qaeda's
    reach.
        Then Director Tenet added the following: ``What I want to
    say to you now may be the most important thing I tell you
    today. The steady stream of Osama bin Laden's anti-U.S.
    sentiment ensures that a serious threat will remain for the
    foreseeable future with or without al Qaeda in the picture.''
    Those are the words which he emphasized, and I think rightly
    so: ``with or without al Qaeda in the picture,'' there is a
    serious threat that remains to us.
        Moreover, he said, ``For the growing number of jihadists
    interested in attacking the United States, a spectacular attack
    on the United States homeland is the brass ring that many
    strive for.''
        The DOD and the U.S. military are on the front line of the
    war against terrorism abroad and play a critical supporting
    role defending our country against terrorists on U.S.
    territory. Since our witnesses last testified before this
    committee, we have captured increasing numbers of al Qaeda
    operatives and financiers in Afghanistan, Iraq, and elsewhere,
    due in large part to improved tactical intelligence efforts and
    the relentless hard work of our SOF.
        In Iraq, special operators helped capture Saddam Hussein
    and they continue to corner militants. Meanwhile, SOF are
    providing counterterrorism and counterinsurgency training in
    countless places, from the Philippines, to Colombia, to Mali,
    to Mauritania. Indeed, last year the SOF reached the highest
    OPTEMPO in their entire history, dating back to 1942.
        The initiative of this committee under Senator Warner's
    leadership--and Secretary Cohen and others were involved at
    that time--in establishing the SOCOM and its special funding
    arrangement and the work of the command training and equipping
    these forces primarily through the 1990s has paid off. Just
    last year the SOCOM was tasked with leading the military
    component of the global war on terrorism.
        This committee has asked the DOD to report to us on the
    organizational and other changes that the command must make to
    execute this role and the operational, legal, and policy
    parameters, including the role of Congress, governing SOCOM's
    counterterrorism activities.
        I look forward to hearing from Secretary O'Connell on the
    policy aspects of this issue, and from General Brown on how
    this new role is affecting OPTEMPO, training, procurement, and
    research and development (R&D).
        I would also like to ask our witnesses the questions
    Secretary Rumsfeld reportedly raised in an internal memorandum
    last October: Are we winning or losing the global war on
    terrorism? Are the changes we have made and are making too
    modest and incremental?
        The domestic military component of the war on terrorism is
    the responsibility of the ASD-HD, together with the newly-
    created NORTHCOM. Combatting terrorism in the United States
    focuses more heavily on antiterrorism or force protection and
    consequence management efforts that rely for their success on
    the cooperation of Federal organizations as well as State,
    local, and private entities.
        The critical component is intelligence sharing. I look
    forward to hearing from our witnesses about the state of
    intelligence-sharing efforts with law enforcement and
    intelligence agencies, Federal, State, and local.
        Additionally, I have been long concerned that the
    establishment of the Terrorist Threat Integration Center (TTIC)
    appears to duplicate and overlap to some extent the function of
    the Central Intelligence Agency's (CIA) Counterterrorism Center
    (CTC). We cannot accept a situation where no single entity
    within our government is finally responsible for the analysis
    of foreign intelligence relating to the terrorist threat within
    the United States.
        I have been promised, we have been promised--many of us who
    have raised this issue, including Senator Collins as the
    chairman of the other committee that has jurisdiction--we have
    been promised by Governor Ridge for over a year now that
    Congress would receive a written explanation of the roles of
    CTC and TTIC and where the final responsibility lies. It has
    not been forthcoming. So I also look forward to hearing from
    Secretary McHale and General Eberhart whether they share that
    concern about the lack of the single entity with responsibility
    for foreign intelligence analysis.
        I join you, Mr. Chairman, in thanking all of our witnesses
    for their service and for the improvements that we have seen.

               STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner [presiding]. Thank you, Senator Levin, and
    thank you, Senator Inhofe, for commencing the hearing.
        We will lead off with Secretary O'Connell, followed by
    General Brown and Secretary McHale, followed by General
    Eberhart. We will have your entire statements placed into the
    record, so you may select those portions you wish to highlight.

     STATEMENT OF HON. THOMAS W. O'CONNELL, ASSISTANT SECRETARY OF
       DEFENSE FOR SPECIAL OPERATIONS AND LOW INTENSITY CONFLICT

        Secretary O'Connell. Thank you, Mr. Chairman. Chairman
    Warner, Senator Levin, distinguished members of this committee:
    I would like to thank you for giving me this opportunity to
    speak to you about special operations and the war on terrorism.
    I will keep my opening remarks brief and, as Senator Warner
    suggested, will submit my entire remarks for the record.
        I believe today's challenges to our SOF, our entire
    military, and our Nation parallel those faced during World War
    II. Today, as then, these challenges will be met by forces
    remarkable in their quality, self-sacrifice, courage,
    integrity, and dedication. At the tip of the spear are the
    remarkable men and women of SOCOM. These special operations
    warriors and their service to the Nation inspire my staff and
    the SOLIC element of the Pentagon to work diligently every day
    to support and assist in our mandated oversight role.
        I can assure you that the relationship between my
    organization in the Pentagon and SOCOM have never been better.
    I have a close partnership and friendship with General Doug
    Brown. Together we work to ensure that SOF continue to be
    equipped, trained, and deployed to meet the most critical needs
    of our Nation.
        I had the privilege of visiting many of our SOF personnel
    in Iraq during Christmas week. These quiet professionals are
    indeed inspirational. It is clear to me that the capabilities
    of our forces so evident in Afghanistan and Iraq were direct
    results of critical decisions made over a decade earlier to
    expand and improve our SOF.
        In fact, about a month ago General Brown and I had the
    opportunity to spend some extended time with Senator Warner in
    Florida, and it was very interesting retracing our various
    perspectives of what went on back in those days. But much of
    that work came from this committee. Thank you. Well done. We
    have received outstanding support for our efforts by the
    Members and staff of Congress. We will need your continued
    support as we ask for additional resources to further enhance
    our forces.
        We are making progress and are taking the fight to
    terrorist organizations wherever we can find them. SOF are in
    the vanguard of that effort by having proved their mettle and
    value to the Nation in both Operation Enduring Freedom (OEF)
    and Operation Iraqi Freedom (OIF).
        That said, the pace and intensity of our operations cannot
    be diminished or relaxed in any way or at any time. It is
    indeed an honor for me to be here with General Brown. He
    represents truly the finest that our Nation has to offer.
        Thank you for your interest in and continued support of the
    entire special operations community and I would be happy to
    take your questions later on, sir.
        [The prepared statement of Secretary O'Connell follows:]
                 Prepared Statement by Hon. Thomas W. O'Connell
        Chairman Warner, Senator Levin, and distinguished members of this
    Committee, I appreciate your invitation to update you on the progress
    that Special Operations Forces (SOF) are making on the war on terrorism
    being fought today. I would also like to thank you for the vision and
    foresight shown by Congress in 1987 in establishing the United States
    Special Operations Command (SOCOM) and creating the Assistant Secretary
    of Defense for Special Operations and Low Intensity Conflict (ASD-
    SOLIC) within the Department of Defense (DOD). As a result of your
    actions, we were not faced on September 12 with the task of recreating
    a capacity to wage unconventional war against an unconventional
    adversary. We had in hand the basic building blocks for a global
    military campaign against terrorism, both relying upon the traditional
    regional combatant command structure and by establishing SOCOM as a
    supported command.
        Prior to 1987 the United States had a general practice of only
    creating SOF after the advent of a crisis and typically disbanded the
    force once the crisis had passed. Units were created for specific
    tasks, and dissipated after the conflict had passed. But as was
    discovered during Operation Desert One, the aborted hostage rescue in
    Iran, humans and their skills are more important than hardware. SOF
    cannot be mass produced, they cannot be readily created ``after the
    fact,'' and you need a standing policy voice at the senior level of the
    DOD which can explain effectively to other policy makers what these
    ``silent warriors'' can, and cannot, do.
        I exercise civilian oversight of special operations and low-
    intensity conflict activities of the DOD. One of my responsibilities is
    to ensure that SOF are appropriately employed and senior policy makers
    understand their capabilities as well as their limitations and also the
    risk that some missions might entail. Not only am I an advocate and a
    defender of SOCOM and SOF, but I am also charged with making sure that
    SOF continues to be the best trained, best equipped, most flexible and
    effective fighting force available to our country.
        Representatives from my office spend a significant amount of time
    at SOCOM headquarters in a joint effort to develop the SOF program and
    budget. I actively participate in the SOCOM Board of Director's
    meetings, the Command's executive resource forum. This joint effort
    produces a SOF program and budget that emphasizes force readiness and
    sustainability, provides sufficient force structure to meet the demands
    of the geographic warfighting commanders and the Commander, SOCOM in
    his role as a supported commander.
        My office provides executive program direction and DOD sponsorship
    of the Technical Support Working Group (TSWG) through ASD-SOLIC's
    Combating Terrorism Technology Support Office (CTTSO) which addresses
    the Nation's interagency combating terrorism requirements. The TSWG
    conducts the national interagency research and development (R&D)
    program for combating terrorism requirements. The TSWG is a unique
    forum with membership from more than 80 organizations across the
    Federal Government. The Assistant Secretary of Defense, Homeland
    Defense actively participates. Projects are selected following a
    coordination process with other U.S. Government agencies and with three
    countries--the United Kingdom, Canada, and Israel--with whom we conduct
    cooperative R&D programs. The TSWG has an impressive record of
    successful projects that have resulted in:

             Specific building design guidelines for protection
            against blast.
             Countermeasures to defeat improvised explosive and
            chemical/biological devices.
             Personal protection equipment.
             Equipment for military and civilian response teams for
            chemical incidents.

        Numerous TSWG developed systems are deployed supporting our troops
    today. We continue to serve the technology needs of the warfighter in
    eliminating the threat itself. The Secretary of Defense has noted
    repeatedly that to address any of a myriad of threats we shall be
    facing, it is necessary to shorten the decision cycle for force
    definition, equipping, and deployment. Through its numerous
    requirements-driven successes and by continuing to reflect partnered
    cooperation across its subgroups and among Federal agencies, the
    Combating Terror Technology Support Program has shown it can meet that
    expectation.
        I am responsible for the DOD's worldwide antiterrorism policy and
    oversight of our antiterrorism programs. My office works closely with
    that of the Assistant Secretary for Homeland Defense (ASD-HD) on
    domestic aspects. The SOLIC office establishes antiterrorism standards
    and monitors the DOD component antiterrorism programs to reduce
    vulnerability. My office co-chairs the Antiterrorism Coordination
    Committee--Senior Steering Group with the Joint Staff Director of
    Operations. This is the senior corporate body within the DOD charged
    with the responsibility to foster cooperation and coordination of
    antiterrorism activities. The most critical function of the forum is to
    act as a clearinghouse for policy recommendations to the Secretary of
    Defense concerning the protection of DOD personnel and their family
    members, facilities, critical infrastructure, and other material
    resources from terrorist acts.
    Global War on Terrorism
        When I appeared before you last year, I identified several
    priorities I would have as the ASD-SOLIC. These priorities were not
    comprehensive but did reflect general areas or issues that require
    special commitment and attention. The first and the most obvious and of
    immediate importance--continued execution of the global war on
    terrorism. I believe that the United States is at a critical moment in
    this war. We have realized initial successes and achieved a degree of
    momentum that together support a general assessment that we are making
    progress in winning this war. But sustaining that momentum and
    continuing the successes against terrorists and their supporters now
    and into the future is just as critical.
        For the past 2-plus years we have examined how the attacks of
    September 11 have changed how we define ``defense,'' and how, as a
    consequence, the war on terrorism is fundamentally a different type of
    war than those we have fought before. Prior to then we perceived and
    responded to the threat of global terrorism in terms of transnational
    criminal activity, albeit politically or religiously motivated. Today's
    international terrorist is far different than those of the past, as
    terrorists now have global reach, infrastructure, and significant
    resources. While SOF were always a part of the equation in addressing
    terrorism, the posture and role of SOF today in combating and defeating
    global terrorism has changed.
        Indeed, that is true of the entire military and the entire concept
    of national defense. Previously, we were postured to defend against a
    state projecting force across great distances, and we built extensive
    capabilities to provide us early warning and tools to deter aggression.
    But the potential destructiveness of an attack of the type we suffered
    on September 11 means that we are no longer afforded an opportunity to
    determine an ``appropriate response,'' nor make a clear determination
    of when decisive action is too little or too late. For reasons we all
    understand, SOF have become a critical military tool in taking the war
    to the terrorists before it can be fought on our own soil or that of
    our allies.
        SOF are uniquely qualified for that mission. Because of those
    qualifications and the demands of the war on terrorism, the DOD has
    been structuring and shaping SOF in different ways. While SOF were
    originally conceived to be used as forces for supporting or leveraging
    larger conventional forces in battle, or for undertaking discrete,
    limited strategic missions, the new reality has given SOF a prominent,
    front-line, essential role in the defense of our Nation. The most
    important manifestation of this change is the designation of SOCOM to
    be the supported (or ``lead'') command in the war on terrorism. SOCOM
    will plan and execute key missions as a supported combatant command.
    SOCOM is expanding to directly plan combat missions against terrorist
    organizations and execute those missions as the supported command,
    while maintaining the role of force provider and supporter to the
    geographic combatant commanders.
        This means SOF will continue to support regional commanders, while
    also at times being supported by other combatant commands. SOF are
    still the first in and last out in many contingency operations around
    the globe. SOF must be ready to act at any time, in all environments,
    overtly or clandestinely; alone or in concert with other U.S. personnel
    and coordinating foreign forces.
        Before I discuss further what has changed and what our new national
    security imperatives require of SOF, I want to note explicitly that one
    of the most important factors and essential considerations for us has
    not changed: the importance of the special operator. In terms of
    missions performed and in the qualities of the individuals who
    undertake those missions, the special operations operator is truly
    unique and requires a different type of mindset on our end in terms of
    planning and support. These warriors must be capable of conducting
    strategic operations in all tactical environments with language
    proficiency, cultural awareness, political sensitivity and the ability
    to maximize information age technology. Recruiting, training, and
    retaining SOF will not be without challenges. The analysis to date
    indicates that we will have the right numbers to sustain the forces the
    Nation needs. Training instructors have been added to the staff of the
    John F. Kennedy Special Warfare Center and the Naval Special Warfare
    Center. The number of training slots has increased for Army SOF, civil
    affairs, and psychological operations. In addition, special pay and
    bonuses have helped retention in these highly specialized areas and
    units. We will continue to closely monitor our ability to have the
    right numbers not only in operational units today but also in the
    training pipeline that produces the forces we require in the future. In
    many respects force management is the most critical problem facing SOF.
    We must never lose sight of what we call the ``SOF Truths:''

             Quality is better than quantity.
             SOF cannot be mass produced.
             Competent SOF cannot be created after a crisis occurs.
             Humans are more important than hardware.

        These truths have been reaffirmed by the superb performance of our
    SOF in Afghanistan, Iraq, Colombia, the Philippines, and many other
    countries around the world. I am keenly aware of how very much the
    dedication and commitment of our special operations professionals are
    appreciated by every member of this committee.
        One effect of the global war on terrorism has been a significant
    increase in operational tempo (OPTEMPO) for SOF. The DOD has added
    3,700 additional personnel during the period fiscal year 2004-2009 for
    SOCOM. This additional strength growth supports the manning
    requirements to wage the global war on terrorism. The increases are
    focused on fixed and rotary-wing aviation, SEAL teams, civil affairs,
    psychological operations, and theater special operations commands.
        Recently, I had the privilege to visit both SOF and conventional
    forces in Iraq. These forces make us proud--and should cause potential
    adversaries to pause before seeking to harm the United States. The
    commitment of SOF to pursuing terrorists to all corners of the globe is
    embedded in their mindset. The experience gained in defeating the
    Taliban and disrupting al Qaeda in Afghanistan, destroying the brutal
    regime in Iraq and aiding friends and partners in other corners of the
    globe, such as Colombia and the Philippines, has matured our
    warfighters to a keen edge. Our challenge is to maintain that edge.
        I also saw that the nature and importance of the new demands on SOF
    are apparent to the operators in the field, and they are clearly doing
    more with the additional manpower, funding and materiel we have given
    them to meet the new challenges to our national security. To meet that
    challenge, there are necessary increases in support and training. This
    level of support is required to meet the challenges of the war on
    terrorism. The change from a regional, reactive posture to a global,
    proactive posture could not be achieved nor sustained with the levels
    of funding, materiel, and forces that we had before September 11.
    Transformation
        A second area of emphasis is transformation of SOF. SOCOM is
    transforming SOF capabilities to meet the formidable challenges
    associated with waging war against terrorist cells scattered across the
    globe. The SOCOM is building the capability to maintain sustained
    operations in areas where terrorist networks are operating. It is
    investing in critical ``low-density/high-demand'' aviation assets that
    provide SOF with the mobility necessary to deploy quickly and to
    execute their missions quickly. Investments in key command, control,
    and communications enhance support to the war on terrorism. The SOCOM
    has added personnel to enhance the ability to sustain worldwide
    deployments and 24-hour-a-day operations. Any future SOF will be:

          (1) Sized, trained, and equipped to engage in any threat
    environment against any adversary
          (2) Culturally, linguistically, politically, and regionally
    focused
          (3) Rapidly deployable
          (4) Capable of conducting exceptionally--precise discriminate
    strikes against specific targets
          (5) Able to achieve operational and tactical superiority
          (6) Operationally and strategically agile joint forces that can
    develop and execute unconventional, audacious, and high pay-off courses
    of action.

        The fiscal year 2005 President's budget submission for SOCOM is
    $6.546 billion. This funding request will continue the modernization
    and transformation effort started in fiscal year 2004. It will enable
    SOCOM to:

          (1) Transform SOF capabilities to better locate and track
    individual terrorists across the globe and conduct small surgical
    operations with minimal risk to the employed force.
          (2) Maintain sustained operations in areas where terrorist
    networks are operating.
          (3) Continue to invest in critical ``low-density/high-demand''
    aviation assets that provide SOF with the mobility necessary to deploy
    quickly and to execute their missions quickly.
          (4) Continue to invest in key command, control, and
    communications to more effectively support the war on terrorism.
          (5) Support the personnel SOCOM has added to better support
    worldwide deployments and 24-hour-a-day operations.

        This funding is essential to sustaining the necessary operations in
    the war on terrorism and to ensuring we can meet essential
    transformation requirements. The hallmark of SOF is that they are
    adaptive to change and characterized by creativity. The success of
    change and transformation is the ability to maximize the ability of the
    human to think and problem solve while taking advantage of the rapid
    pace of technology. Transformation of SOF is a journey, not a
    destination and there is no mark on the wall that will indicate we are
    finished transforming. Transformation is a continuing process that not
    only anticipates the future, but also seeks to create that future.
    DOD Counternarcotics Efforts/Counternarcoterrorism
        Each year, my office expends a great deal of time, effort, and
    resources to keep drugs from crossing our borders. This is a complex
    process that requires coordination and funding from all levels of
    government agencies, local and state law enforcement, and the foreign
    countries in which we assist in the eradication of crops and disruption
    of their transportation to the United States. A large portion of the
    profits from drug sales indirectly support terrorist organizations--
    another reason we are working hard to reduce the supply of drugs.
        Illegal drug use exacts a heavy toll on American society every
    year. Illegal drugs account for billions of dollars in direct and
    indirect costs including health care, lost revenue due to crime, social
    welfare costs and lost productivity. While cocaine continues to be the
    single most serious drug threat, heroin, synthetic drugs,
    methamphetamines, and marijuana are also serious, and in some cases,
    increasing problems. Additionally, there are clear linkages between
    international narcotics trafficking and international terrorism. Global
    and regional terrorists threatening United States interests can finance
    their activities with the proceeds from narcotics trafficking.
    Terrorist groups such as the Revolutionary Armed Forces of Colombia
    (FARC), al Qaeda in Afghanistan, and groups around the world partially
    finance key operations with drug money. The DOD, with our counterparts
    in the Department of State and other Government agencies, as well as
    allies such as the United Kingdom, seeks to systematically dismantle
    drug trafficking networks, both to halt the flow of drugs into the
    United States, and to bolster the broader war on terrorism effort.
        In accordance with statutory authorities, we use counternarcotics
    resources as effectively and efficiently as possible to achieve
    national and DOD counternarcotics priorities. We focus on programs that
    fulfill statutory responsibilities and use military-unique resources
    and capabilities, and continue to advance the national priorities of
    the National Drug Control Strategy. Our counternarcotics authorities
    and funding are an effective combination that supports war on terrorism
    efforts and the implementation of the DOD's Security Cooperation
    Guidance. Furthermore, they contribute to our efforts to secure the
    Nation's borders and establish full maritime, ground, and air domain
    awareness of the approaches to our shores. We work closely with
    Assistant Secretary McHale's staff on these matters.
        In the international arena, the DOD provides much of its
    counternarcotics support through deployments and programs to train and
    furnish intelligence and operational support for drug detection,
    monitoring, and provide equipment to partner counterdrug forces. These
    countertrafficking methods aim directly at disrupting the terrorist
    drug trade and finance networks that train partner-nation military
    forces.
        This, of course, includes cooperative military-to-military programs
    in which countries grant access to our military operators and enable
    access to target areas. Our authorities permit us to: maintain, repair
    and upgrade equipment, transport personnel, establish bases of
    operations or training facilities, assist with detection, monitor and
    communicate trafficking activities, construct roads, fences, and
    lighting installations, establish command, control, communications, and
    computers (C\4\) networks, provide intelligence analysis assistance and
    conduct aerial and ground reconnaissance.
    Domestic CN Support
        ASD-SOLIC works closely with U.S. Northern Command (NORTHCOM) and
    ASD-HD on counternarcotics support to domestic law enforcement. The
    focus of this support is managed through Joint Task Force-Six (JTF-6)
    in El Paso, Texas which provides active duty and Reserve missions in
    areas of engineering support, aerial and ground reconnaissance,
    transportation and logistics support and intelligence. These
    counternarcotics missions provide excellent training in real world
    situations and enhance domestic security. In order to alleviate stress
    on our Active-Duty Forces, the DOD first turns to the National Guard to
    provide support to domestic law enforcement. To effectively meet this
    objective, the DOD is transitioning the National Guard counterdrug
    effort out of missions that are not militarily unique (cargo-mail
    inspections, maintenance and logistics, marijuana eradication), to
    those that are militarily unique (air/ground reconnaissance,
    intelligence analysis, training for law enforcement agencies), and is
    enhancing National Guard support to law enforcement along the southwest
    border, and at linguist centers in California and Washington.
                      foreign consequence management (fcm)
        I also oversee DOD policy on support to Foreign Consequence
    Management (FCM) operations. FCM operations focus on providing
    specialized assistance in response to use of chemical, biological,
    radiological, nuclear, chemical, explosives (CBRNE) against friends or
    allies, installations, vital interests, or U.S. military forces
    overseas.
        An event overseas involving CBRNE would likely impact not only our
    friends and allies, but potentially U.S. civilian and military
    personnel stationed abroad. It is in our interest to be ready to help
    save lives and reduce suffering in the aftermath of such an event, just
    as many of our friends assisted us in the aftermath of the September 11
    attack.
        The primary responsibility for managing and mitigating the effects
    of a foreign CBRNE incident resides with the host-nation government.
    The Department of State is the lead Federal agency for all DOD support
    to FCM operations. When requested by the lead agency, and approved by
    the Secretary of Defense, the DOD supports the State Department in FCM
    operations, as appropriate.
        The DOD geographic combatant commanders command and control all DOD
    support to FCM operations within their respective areas of
    responsibility (AORs), in coordination with the appropriate U.S. Chief
    of Mission. We work closely with the Department of State to ensure that
    our contingency plans for support to an FCM operation are fully
    coordinated. Our geographic combatant commanders have been refining
    their contingency plans and exercising their capabilities for providing
    support to an FCM operation, should they be called upon to do so.
        In closing, I would like to assure you that I will continue to work
    closely with my colleagues here with me today to make this Nation safe
    and ensure that U.S. SOF continue to be the best trained, best
    equipped, most flexible, and effective force available to our country.

        Chairman Warner. Thank you, Mr. Secretary. We particularly
    welcome you. The position you hold is one created by Congress.
    I participated in the legislation many years ago. You bring to
    this post--you are too modest to talk about it--your own
    exceptional career in the military in earlier years, and you
    are most ably qualified to take on the post and, to the extent
    that I have had the privilege of working with you, you approach
    it with tremendous zeal and enthusiasm.
        Secretary O'Connell. Thank you, Senator.
        Chairman Warner. I can understand how serving with such a
    distinguished soldier as General Brown, whose career reaches
    back to Vietnam, would be so rewarding. General, I recall very
    well that picture in your office where you are a young first or
    second lieutenant flying those old helos.
        General Brown. Yes, sir.
        Chairman Warner. So why do you not go ahead now, General.

    STATEMENT OF GEN BRYAN D. BROWN, USA, COMMANDER, UNITED STATES
                       SPECIAL OPERATIONS COMMAND

        General Brown. Mr. Chairman, Senator Levin, distinguished
    members of the committee: It is an honor to appear before you
    today to report on the posture of SOCOM. With your permission,
    I would like to make a few remarks and then submit a longer
    statement for the record.
        As the Commander of SOCOM, I have defined our priorities as
    the global war on terror, readiness of our force, and
    transformation. Focusing the command's efforts in these areas
    will ensure that our SOF are decisive as they defend America on
    the battlefield today, but are also postured for success in the
    future.
        The men and women of SOCOM are deployed today around the
    world under the operational control of geographic combatant
    commanders. This is a force unlike any other. For the most
    part, they work in small numbers in remote locations. They
    often work with indigenous forces and in many areas are
    constantly ready to operate quickly, day or night, in response
    to perishable intelligence. They are attacking the enemy at
    every opportunity, far from our shores, to prevent hostile
    action here at home, and are prepared to assist NORTHCOM's
    homeland defense efforts if requested.
        SOF's selection process, high levels of training and
    maturity are the keys to their success. They maintain America's
    security and help create stability and opportunity in countries
    like Afghanistan and Iraq. Quite frankly, they are a highly
    trained, combat ready force, and are doing an incredible job.
        Mr. Chairman, SOF are in high demand and are employed in
    greater numbers, as you pointed out, than any time in our
    history. In certain skills, such as civil affairs and
    psychological operations, where most of the force is either in
    the Reserve or National Guard, we are stressed. However, our
    OPTEMPO is manageable. Today all requests for SOF are closely
    reviewed by my headquarters and require my personal approval
    prior to any deployment. This ensures the right forces are
    provided to the geographic commanders as they fight the battle.
    It allows our component commanders to closely monitor
    deployment and manage personnel tempo.
        We cannot win the global war on terrorism without
    maintaining a superior warfighting excellence and that requires
    a commitment to readiness. Over the years we have built the
    most capable active, Reserve, and National Guard SOF the world
    has ever seen. To maintain this force and remain dominant on
    this new battlefield, we are continuously reviewing all our
    requirements, all our capabilities, to ensure the correct focus
    of our programs is on our global war on terrorism strategy.
        Mr. Chairman, we are also transforming our force. We are
    researching new techniques, such as the feasibility of unmanned
    aerial vehicles (UAVs) to conduct psychological operations
    missions in denied areas, and reviewing proposals for the Next
    Generation Gunship in concert with the United States Air Force
    to replace our very effective but aging AC-130 gunship
    platforms.
        We are anxious to employ the capabilities of a safe,
    reliable, and maintainable CV-22 Osprey. Additionally, we are
    looking across the DOD and industry to identify cutting edge
    technologies for our operators and we are rapidly acquiring
    those that provide immediate benefit.
        Our transformation efforts will remain focused on the
    cornerstone of special operations capability, our people. They
    are specially selected and highly trained. Special operations
    warriors remain the key to our success and the budgetary
    authority provided by Congress makes all this possible.
        In conclusion, Mr. Chairman, I want to thank you and the
    members of the Senate Armed Services Committee for your
    continued outstanding support to our soldiers, sailors, airmen,
    marines, and our DOD civilians. Additionally, thanks for your
    visits to our troops in the field around the world. These
    visits are important and they do not go unnoticed by our
    special operators. The support of this committee and the
    support of the Secretary of Defense, as well as our great
    relationship with the ASD-SOLIC, Tom O'Connell, helps make our
    success possible. SOF are more capable, more lethal, because of
    your efforts.
        I look forward to answering your questions.
        [The prepared statement of General Brown follows:]
                 Prepared Statement by GEN Bryan D. Brown, USA
        Mr. Chairman and distinguished members of the committee, it is an
    honor and privilege to report to you on the state of the United States
    Special Operations Command (SOCOM). Despite the many new and varied
    challenges we face, your men and women of SOCOM are performing
    magnificently. Today's Special Operations Forces (SOF) are the most
    capable in the world.
        Secretary Rumsfeld expanded SOCOM's role to include leading the
    Department of Defense's (DOD) military global war on terrorism planning
    effort, and commanding select global war on terrorism operations. In
    addition, it is important that we maintain our world-class ability to
    organize, train, and equip SOF as originally mandated by Congress.
    SOCOM's special operators, highly trained and armed with the best
    equipment possible, are defending our Nation far from America's shores
    around the world.
        We are standing side-by-side with our interagency, conventional,
    and coalition partners fighting the global war on terrorism. SOF, in
    support of the geographic combatant commanders, have taken the offense
    to the enemy, to strike him where he lives, to bring the battle to him,
    and to bring him to justice. Maintaining America's security and way of
    life, through dedicated operations far forward, cooperation with our
    allies around the world, planning for sustained operations, and
    homeland defense is today's reality. We will engage the enemy far from
    America's shores, and provide requested support to U.S. Northern
    Command (NORTHCOM). As we move into the future, our priorities will
    remain the global war on terrorism, readiness of our forces, and
    continuous transformation to match our capabilities with tomorrow's
    battlefield requirements.
        Our skilled SOF warriors continue to achieve successes far beyond
    their limited number. SOF on the ground in Afghanistan are central to
    the search for al Qaeda and Taliban leadership, organizing and
    assisting security and defense forces, reconstruction of
    infrastructure, and helping the Afghan people build a free independent
    country. During combat operations in Iraq, United States Central
    Command's (CENTCOM) tasked special operations to lead two of three
    major battle fronts, and we were closely integrated into the
    conventional force of the third. Today, SOF are integrated directly
    into the CENTCOM force structure, taking the fight to the enemy, and
    helping create stability and opportunity for the people of Afghanistan
    and Iraq.
                            global war on terrorism
    Success in Global War on Terrorism
        SOCOM's number one priority is the global war on terrorism. SOF,
    deployed in support of the geographic combatant commanders, have been
    involved in every phase of the war. SOF were the first forces on the
    ground in Afghanistan and Iraq, and were then integrated with
    conventional forces more closely than in any war in U.S. history. The
    synergy from the joint, combined, and interagency efforts produced
    dynamic results on the battlefield.
    Iraq
        From the onset of planning, SOF were assigned key roles in
    Operation Iraqi Freedom (OIF) to fix the Iraqi V Corps in the north to
    prevent it from reinforcing Baghdad; to conduct special reconnaissance
    and direct action missions in western Iraq; to locate and destroy Iraqi
    mobile missiles; to support Combined Forces Land Component Command
    movement from the south toward Baghdad; to conduct support and
    stability operations throughout the country; and to interdict borders
    and lines of communication. SOF were also assigned missions to seize
    key airfields which they accomplished on occasion by conducting
    airborne parachute assaults. SOF played a critical role in the capture
    of most of the ``deck of cards'' key personnel within the Iraqi regime,
    and they are still capturing high value targets today. SOF seized and
    protected sensitive areas and prevented Sadam Hussein from creating an
    ecological disaster by dumping massive quantities of oil into the
    Arabian gulf and lighting oil fields on fire as was done during
    Operation Desert Storm. Following the collapse of Saddam's regime, SOF
    have continued to play a major role in stability operations with the
    long term goal of assisting in the building of a free and democratic
    Iraqi nation.
        In northeastern Iraq, the Combined Joint Special Operations Task
    Force-North (CJSOTF-N) conducted unconventional warfare, special
    reconnaissance, direct action, and call-for-fire missions against Iraqi
    forces arrayed along the ``Green Line.'' This task force, designated
    Task Force (TF) Viking, was commanded by a special operations officer,
    and was under the operational control of SOCCENT.
        TF Viking's first order of business was unconventional warfare.
    U.S. Army SOF infiltrated Iraq and linked up with Kurdish military and
    political leaders to assess their capabilities and begin the campaign.
    Beginning on March 22, special operations MC-130 Combat Talons flew
    through heavy Iraqi anti-aircraft fire and landed a contingent of SOF
    teams and U.S. Air Force Combat Controllers. Rapidly expanding, TF
    Viking grew to more than 50 individual Special Forces A-teams (ODA) in
    the northern area of operations.
        After taking command of the U.S. Army's 173rd Airborne Brigade and
    the U.S. Marine Corps' 26th Marine Expeditionary Unit (MEU) TF Viking
    integrated them with the Kurdish Peshmerga. Their coordinated offensive
    effort crushed 700 entrenched Ansar aI Islam fighters. TF Viking used
    close air support to mount a successful offensive against Iraqi armor
    and artillery, and took the city of Kirkuk by force. This superb
    combined and joint force also negotiated the orderly capitulation and
    occupation of Mosul and secured the northern oilfields.
        The CJSOTF-West (CJSOTF-W) was tasked with denying the Iraqi
    military their ability to launch missiles into neighboring countries or
    coalition formations. CJSOTF-W's area of responsibility (AOR) included
    the entire western desert area and all of the landmass from Baghdad
    south to the border of Kuwait. In the west, CJSOTF-W controlled a
    combined and joint force. In the south, SOF were integrated directly
    into the conventional force's operations.
        The mission in the western desert area was to deny the Iraqi
    military their ability to launch missiles into neighboring countries or
    coalition formations. SOF were flown into west using MC-130 Combat
    Talons, MH-47Es, MH-60Ls, MH-60Ks, and were supported by MH-60 direct
    action penetraters and AC-130 gunships. The effect of conventional and
    SOF air and organic fire support to SOF teams on the ground,
    particularly in the early days of combat action, allowed the CJSOTF-W
    to overwhelm the Iraqi military and dominate the western desert.
        SOF successfully captured and controlled key infrastructure to
    include a key dam, vital lines of communication and airfields in the
    west. Using Army SOF helicopters, conventional tanks and mobile rocket
    launchers, SOF were able to dominate the Iraqi military in the western
    desert and support conventional forces as they moved on Baghdad.
        In the southern area between the Kuwaiti border and Baghdad, the
    primary missions of CJSOTF-W were strategic reconnaissance and
    unconventional warfare. SOF teams were inserted deep into Iraq by U.S.
    Air Force Special Operations helicopters and quickly conducted
    reconnaissance of key locations. This information, passed on to ground
    conventional maneuver commanders, was a significant contributing factor
    to the speed and audacity of the ground campaign. Other SOF teams
    dispersed throughout the area and began to work with Iraqi nationals
    sympathetic to the coalition cause. These teams identified and rooted
    out Fedayeen Saddam, Baath party members, regime death squads, and
    other terror cells.
        The Naval Special Warfare Task Group (NSWTG) was given the task of
    securing strategic targets in the Iraqi littoral areas. This area was
    important because of oil terminals, the oil metering and manifold
    stations, and the two oil pipeline support valves. In addition, this
    was the initial avenue for providing seaborne humanitarian aide to
    Iraq.
        Under cover of darkness, U.S. Navy Sea, Air, and Land (SEAL) swept
    down from helicopters and boats to secure five targets in unison. In
    less than 40 minutes the critical nodes were secured and the threat of
    an ecological disaster was eliminated.
        Following these successful missions conducted on the first night of
    the war, NSWTG quickly moved into position to support the requirements
    of both land and maritime commanders. They assisted in safeguarding the
    waterway leading to the city of Basrah, and helped clear the waterway
    and port of Umm Qasr. NSTWG was also vital in securing the U.S. Marine
    Corps' Marine Expeditionary Force's (MEF) lines of communication and
    logistics, which allowed the Marines to conduct their offensive
    movement toward Baghdad.
    Afghanistan
        The CJSOTF--Afghanistan (CJSOTF-A) is the special operations
    component of Combined Joint Task Force-180. CJSOTF-A is working to
    rebuild infrastructure, and establish a positive rapport with the local
    populace. They are also directly involved in operations against anti-
    coalition forces within Afghanistan.
        Deployed in small detachments throughout Afghanistan, SOF are
    working directly with the Afghan National Army, conventional U.S.
    forces, and local governments. This close working relationship allows
    SOF to identify problems and work solutions with local governments.
    This relationship also allows SOF to gather information about anti-
    coalition efforts invaluable to our long-term efforts.
        One of the primary goals of CJSOTF-A is to capture or kill al Qaeda
    and Taliban forces. SOF, together with Afghan National Army units,
    other coalition partners, and conventional U.S. forces have conducted
    multiple operations throughout Afghanistan. These operations resulted
    in the capture of numerous anti-coalition forces and the destruction of
    hundreds of weapons and thousands of pounds of enemy explosives.
    Psychological Operations
        Dissemination of truthful information to foreign audiences in
    support of U.S. policy and national objectives is a vital part of SOF's
    effort to secure peace. Culturally oriented psychological operations
    (PSYOP) units with selected language skills are supporting commanders
    and other U.S. Government agencies in operations ranging from
    humanitarian assistance to weapons collection. Additionally, our PSYOP
    forces have an aggressive program of providing handbills to children
    explaining the threat of unexploded ordinance and minefields. These
    forces, along with SOF civil affairs units, are force multipliers. They
    use nonviolent means in often violent environments to convince enemy,
    neutral, and friendly nations and forces to take action favorable for
    the U.S. and its allies.
    Civil Affairs
        Civil affairs forces are key to our long term success in the global
    war on terrorism. Civil affairs specialists can quickly and
    systematically identify critical requirements needed by local citizens
    in war. They can also locate civil resources to support military
    operations, help minimize civilian interference with operations,
    support national assistance activities, and establish and maintain
    liaison dialogue with civilian aid agencies and civilian commercial and
    private organizations. They help commanders in the field meet their
    moral obligations to the civilian population.
        Civil affairs forces are currently working with local governments
    of Iraq and Afghanistan and international humanitarian organizations to
    rebuild infrastructure and restore stability. They are coordinating
    projects to repair wells, provide food to hungry children, bring
    medical care to families, and are hard at work getting school systems
    rebuilt to stem the tide of radical thought through education.
    Lessons Learned
        The SOCOM team continues to meet and exceed all expectations and
    achieve remarkable results on the battlefield. Because of our heavy
    engagement in both Operation Enduring Freedom (OEF) and OIF and other
    significant efforts in support of the global war on terrorism, SOF are
    learning many important lessons. We are incorporating these lessons
    into our future activities in order to ensure our joint team remains
    decisive. Some of these lessons learned include:

        1. SOF training and doctrine were proven effective. There were many
    instances where our special operators on the ground, sea, and air
    identified previous training methodology and exercise programs as the
    key to their success. They were able to draw directly from skills
    developed through SOF training programs to accomplish missions.
    Specifically, they commented on the ``out of the box'' thinking and
    problem solving required in the training programs as well as SOF direct
    combat skills.
        2. SOF/conventional force integration is critical. SOF apportioned
    to CENTCOM were directly integrated into all phases of the effort. The
    interoperability of SOF reached new levels of performance. SOF and
    conventional forces under the command of CENTCOM were integrated at the
    staff level and interoperable at the tactical unit level in both
    planning and execution. This made both SOF and the conventional forces
    much more effective.
        3. Engage and deploy SOF early. The ability to quietly employ SOF
    early in any circumstance allows the elimination of key enemy strategic
    targets and preparation of the battlespace for follow-on forces. In
    Iraq SOF were inserted early to fix Iraqi units, prevent SCUD launches,
    and assist our conventional land force's advance.
        4. Blue Force Tracking (BFT) is a critical capability. We were able
    to provide superb situational awareness of SOF internally and with our
    warfighting partners--on the ground, sea, and in the air due to
    proactive fielding of BFT beacons. This program will reduce the
    incidence of fratricide and greatly enhance our situational awareness
    on a fluid, dynamic, and often non-contiguous battlefield.
        5. SOF logistical support needs improvement. SOF by nature have
    unique logistical requirements and a limited organic support structure.
    Support from the Services is critical to sustaining SOF on the
    battlefield. The solution is the creation of a SOF logistics doctrine
    and we are building it. .
        6. Fratricide is still a problem. Although we have come a long way
    in protecting our forces with BFT, it alone IS not the answer. We need
    extensive training coupled with technology like BFT. SOCOM is engaging
    the Services and industry to identify technology to further prevent
    fratricide and protect our most precious asset--our warriors.
    SOCOM focus and direction
        When SOCOM was established by Congress in 1987, its primary role
    was to support the geographic combatant commanders by providing them
    with trained and equipped special operations personnel. While the
    command continues to function in a supporting capacity for the
    geographic combatant commanders, the Secretary's guidance on the global
    war on terrorism included an additional role as a supported command for
    planning DOD's military effort in the war on terrorism. In order to
    effectively fulfill this new role as a supported command, we have
    reorganized our headquarters with the creation of the Center for
    Special Operations (CSO).
        The CSO is a joint and interagency directorate with responsibility
    for war on terrorism-related operational issues. By transforming the
    headquarters, SOCOM ensures it is postured to perform ``its new role as
    a ``warfighting'' command while maintaining its title 10
    responsibilities for a world-class capability to train, man and equip
    our forces.
        We are designing a scalable deployable Joint Special Operations
    Task Force Headquarters which will allow the capability for seamless
    planning and execution of operations spanning the spectrum of conflict.
    This new structure will provide SOCOM the flexibility to, when
    directed, command operations. Essentially, our newly created CSO serves
    as SOCOM's new ``warfighting'' hub. Free of administrative functions,
    the Center's sole responsibility is planning, supporting, and executing
    special operations in the war on terrorism.
    Supported vs. supporting command
        The mission of SOCOM changed to include planning direct combat
    missions against terrorist organizations around the world and executing
    those missions as the supported command when directed. This designation
    of SOCOM as the ``supported command'' does not relieve us from the
    responsibilities to provide specially selected, highly trained,
    equipped, and capable forces to the geographic combatant commanders,
        The geographic combatant commanders will normally execute
    operations as the supported commander in their theater of operations.
    SOCOM's designation as supported commander allows for centralized
    planning, expands options for mission execution, and permits a more
    flexible command relationship structure. However, when directed by the
    Secretary of Defense, the Commander of SOCOM will serve as the
    supported commander for specified operations.
        Establishment of the SOCOM Joint Operations Center (JOC) greatly
    increased the capability of the headquarters to monitor and, when
    directed, to command and control antiterrorism operations. Real-time
    BFT and unmanned aerial vehicle (UAV) feeds combined with web-based
    technologies provide detailed situational awareness. Use of the Defense
    Collaborative Tool Suite (DCTS) enables real-time simultaneous
    coordination with geographic commanders, agencies, the Joint Staff, and
    others globally. This greatly reduced planning and execution timelines.
        The CSO is enabling us to meet new requirements associated with the
    global war on terrorism. Responsibilities in the CSO include reviewing
    global strategies, development of courses of action, and formulating
    recommendations for operational force employment by the Commander,
    SOCOM through the Chairman of the Joint Chiefs of Staff to the
    Secretary of Defense. The CSO can plan, direct, monitor and assess
    combat operations directed against selected targets anywhere on the
    globe.
    Intelligence
        Practical experience and our own exercises have demonstrated the
    counterterrorism problem set is, at its very core, an intelligence
    based problem set. In other words, we have to find out who the bad guys
    are, where they are, and have the right forces in the right place at
    the right time to capture them. Essential to the desired end state is
    immediately actionable and accurate intelligence predicated by expert
    intelligence analysis. Unlike the Cold War where it was easy to find
    the large mechanized force that was hard to kill, the terrorist is very
    hard to find and comparatively easy to capture or kill.
        SOCOM, in coordination with the Under Secretary of Defense for
    Intelligence and the Intelligence Community, is developing an all
    encompassing intelligence, surveillance, and reconnaissance (ISR)
    strategy. This strategy will develop the kind of capabilities, like
    signals intelligence (SIGINT), imagery intelligence (IMINT) and
    unattended sensors that channel the proper intelligence information to
    our analysts and operators so we can capture terrorists regardless of
    where they are on the globe. This persistent ISR concept is a
    combination of tireless analysis, human intelligence (HUMINT), and SOF
    focused ISR systems that will dwell on a target for as long as the
    mission requires. We must be proficient to take the fight to the
    terrorist before he has the opportunity to strike.
        One of the avenues for ensuring robust intelligence is to have a
    strong interagency relationship. At SOCOM we have over 100 interagency
    representatives tightly integrated into our counterterrorism efforts,
    significantly supporting our goal to find, fix, and finish the
    terrorist threat.
                                   readiness
        Force readiness is a SOF priority and is crucial to mission
    success. People, training, and equipment are key factors that determine
    SOF readiness.
    People
        SOF are made up of some of America's most dedicated men and women
    from all of the Services. They are mature, high-caliber professionals
    with intelligence, stamina, problem-solving skills, mental toughness,
    flexibility, determination, integrity, and extraordinary strength of
    character and will.
        To accomplish SOF missions, highly specialized skill sets are
    required, including mastery of technology, cultural and regional
    awareness and expertise, and skilled in both low-tech as well as high-
    tech solutions. To achieve the required level of proficiency and
    guarantee SOF relevance, recruitment, accession, development, and
    retention of the force must be closely managed.
        A small number of people, carefully selected, well trained, and
    well led, is the key to our quality force. However, we must have the
    correct mix of active, Reserve, and National Guard personnel to meet
    the challenge. Our current operations tempo (OPTEMPO) is sustainable
    and programmed manpower increases will improve our capability to meet
    the demand on our force. Areas of concern include our U.S. Army PSYOP
    and civil affairs forces, where 96 percent of the force is in the
    Reserve component or National Guard and long-term mobilization is
    difficult. To improve these areas over the next 5 years we are adding
    four PSYOP companies (Reserve), two PSYOP companies (active), two civil
    affairs battalions (Reserve), and two civil affairs companies (active).
        Another concern is combat power and our ability to move on the
    battlefield. We are addressing these areas by adding two U.S. Navy SEAL
    teams (active), and one U.S. Army MH-47 aviation battalion (active). We
    are also adding 4 additional U.S. Air Force AC-130 gunships, 10 MC-130
    Combat Talon II aircraft and associated personnel to support forward
    deployed and rotational requirements while maintaining our training
    standard. We believe people are more important than hardware and
    closely monitor our deployment schedules to ensure we care for both our
    military force and their families are properly cared for. However,
    adding SOF is not a short term fix.
        The projected force and equipment additions do not provide
    immediate relief because SOF cannot be mass-produced. The service
    members who volunteered to join SOF following the events of September
    11, 2001, and successfully completed the arduous SOF selection and
    training regimen, entered SOF's deployable force over the past few
    months. Since competent SOF cannot be created immediately, we must plan
    ahead to create units sufficient in size, capability, and speed of
    response to meet our requirements. It is also critically important that
    we are able to retain these individuals who have vast expertise and
    experience, especially as they become retirement eligible at the peak
    of their value to the Armed Forces. Retention of these highly qualified
    personnel is critical and the competition with the civilian world has
    never been greater.
    Budget
        Our fiscal year 2005 budget request is $6,566 million or 1.6
    percent of the DOD budget and some 48,000 personnel. Yet these limited
    SOF resources greatly enhance the effectiveness of conventional
    military forces by providing essential leveraging capabilities all the
    while ensuring that ``must succeed'' special operations are completed
    with the absolute certainty and professionalism the Nation demands. No
    where has the benefit of this powerful investment been clearer than
    during operations in Afghanistan, Iraq and elsewhere in the global war
    on terrorism. However, SOF have been remarkably effective no matter
    what the nature of the conflict.
        Long term success in the global war on terrorism depends largely
    upon our ability to rapidly employ a sustainable mix of capabilities
    with little warning. Terrorist threats today are elusive, pervasive,
    asymmetric, and adaptive. Non-traditional approaches to planning and
    tactics are required. To meet this challenge, SOCOM refocused resources
    to address three vital challenges: planning and directing the global
    war on terrorism; preserving readiness of our SOF; and transforming SOF
    to more agile, adaptive, and responsive warriors.
        SOF are comprised of specially selected, trained, and organized
    special operations soldiers, sailors, airmen, and marines from the
    Armed Forces. Their training, education, maturity, initiative, and
    experience set them apart from all others in the DOD. SOCOM's fiscal
    year 2005 President's budget emphasizes the SOF philosophy of funding
    the right training and equipment for the right people, so they can
    arrive at the right objective, and most importantly, producing mission
    success. Fundamental to mission success is the readiness of our SOF
    warriors and their unique skill sets, including the Reserves and
    National Guard who fight side by side with our Active-Duty Forces. Our
    readiness efforts also extend to support programs for families of our
    SOF.
        SOCOM faces a strategic environment characterized by rapid
    geopolitical change and technological advancement, evolving threats,
    and potential emerging new roles. These factors require innovative
    thinking and new ways to shape change to provide the widest array of
    options in protecting American's interests. To meet this challenge,
    SOCOM is pursuing a holistic approach to transformation through
    training, organizational structure, and technology. Key resourcing
    initiatives identified by SOCOM will support transformation of special
    operations in the realm of materiel, organization, training, and
    doctrine. These initiatives include, but are not limited to: Naval
    Special Warfare's 21st Century Realignment, Army Special Operations
    Aviation 21st Century Reorganization initiatives, improved Theater
    Special Operations Command capabilities, enhanced training curriculums,
    maintenance and sustainment of key SOF assets, and providing the
    optimum mix of gear for our SOF operators.
        The SOCOM fiscal year 2005 President's budget requests the
    resources necessary to continue to provide full spectrum, multi-mission
    global SOF that provide a comprehensive set of unique capabilities for
    the Nation.
    Acquisition
        A real strength of SOCOM is the commander's acquisition authority,
    which is similar to that of the Services. Among the responsibilities
    assigned to SOCOM under title 10, section 167, is developing and
    acquiring ``special operations-peculiar'' equipment. SOF-peculiar
    equipment is based on technologies that enable our operators to become
    faster, stealthier, more precise, lethal, survivable, and sustainable.
    With exceptional support from Congress, the Secretary of Defense,
    Services, other government agencies (OGA), and our industry partners,
    these authorities have been instrumental in equipping today's world-
    class SOF team to perform a broad range of SOF missions.
        Although our people are certainly SOF's most important asset,
    maintaining and improving materiel capabilities remains SOCOM's most
    difficult challenge. Our near term objective is to continue to realign
    our requirements and programs to better address the global war on
    terrorism mission. We will be eliminating those systems that do not
    support the global war on terrorism and using the saved resources to
    invest in future capabilities. Our programs must be transformational,
    not merely a reinvestment of what we are doing today. SOCOM must
    continue to invest in making our SOF more capable in all tactical
    environments. Our current Flagship Programs, the Advanced Seal Delivery
    System (ASDS) and the CV-22 Osprey continue to be a very important part
    of SOF's future. Additionally, our research and development (R&D)
    activities are refocusing on discovering and exploiting technologies in
    the following areas:
        Individual As A Platform
        We have always said the individual is the indispensable element of
    SOF. In order to ensure we ``equip the man'' not ``man the equipment,''
    we are making the SOF Warrior System a Flagship Program. This will
    create the appropriate focus on every consideration affecting our
    warfighter: budgeting, recruitment, training, doctrine, and equipment.
    We need to develop enhanced protection, armor, lightweight sustainment
    systems, night vision devices and better weaponry. The SOF operator
    must be able to manage his signature in all environments and see the
    enemy regardless of concealment. We need to do this without increasing
    weight and complexity.
        Power
        Power sources have been, and continue to be, both a major problem
    and critical need for SOF. A significant amount of the weight carried
    into combat is from batteries. SOF urgently needs power sources that
    are small, lightweight, and inexpensive while providing high power,
    long-endurance, interchangeability, and multiple recharging features.
    These batteries or fuel cells must give off little or no signature and
    offer the SOF user an extended operating capability without suffering
    degradation or requiring re-supply.
        Sensors
        We will pursue a family of unmanned, semi-autonomous or autonomous
    systems (air, sea, land, and in the future, space) ranging in size from
    tactical to micro and nano, accompanied by persistent intelligence and
    denied area access technologies to meet the needs of SOF operators.
    These systems must possess a reduced logistical footprint and withstand
    the rigors of various climates and operating environments.
                                   conclusion
        SOF are deployed around the world engaged in the global war on
    terrorism fighting for our way of life. Your continued support of our
    soldiers, sailors, airmen, marines, and DOD civilians is the foundation
    of our success. Thank you. I look forward to answering your questions.

        Chairman Warner. Thank you, gentlemen.
        I had the privilege, together with Senator Stevens and
    Senator Hollings, to visit your forces in Iraq last week and
    then thereafter your forces in Afghanistan. You can rightfully
    be very proud of them.
        General Brown. Sir, we are.
        Chairman Warner. It is extraordinary.
        My first question--and it will come to you, gentlemen, and
    you might reflect on it, if you have not. Secretary Rumsfeld
    announced a rather widespread long-range program of changing
    base structures and deployment at forward bases. I think it has
    a significant and positive impact on your special charter in
    the defense plan.
        Now, Secretary McHale, we are glad to welcome you. You
    likewise have a strong set of credentials to take on this
    position, most notably having been a Member of Congress here in
    years past. So you understand this branch quite well and I
    expect you will be able to deal with us a little better.

     STATEMENT OF HON. PAUL McHALE, ASSISTANT SECRETARY OF DEFENSE
                          FOR HOMELAND DEFENSE

        Secretary McHale. Mr. Chairman, I will try not to
    disappoint you.
        Chairman Warner, Senator Levin, distinguished members of
    the committee: It is a privilege to appear once again before
    this body. To be entrusted with national security
    responsibilities at any time, but especially at this point in
    our country's history, is a solemn and sacred duty. From past
    experience, I fully appreciate and respect your oversight
    obligations pursuant to article I, section 8, of the
    Constitution.
        My goal today is to provide the committee with a candid,
    accurate assessment of our current homeland defense
    capabilities and to describe emerging DOD mission requirements.
    Because I have submitted my formal testimony for the record, I
    would like to provide only a brief introduction at this point
    and thereafter allow maximum time for member questions.
        I appear before you today in my capacity as ASD-HD. My
    position was created by Public Law 107-314, the National
    Defense Authorization Act for Fiscal Year 2003. The statutory
    duty assigned to the ASD-HD is the overall supervision of the
    homeland defense activities of the DOD.
        I was nominated by President Bush in January 2003 and
    confirmed by the Senate 1 month later. As a result, I have been
    serving in this office for just over a year. In the interim,
    much has happened.
        Although my written testimony focuses in some detail upon
    the organizational changes within the DOD following the attack
    of September 11, 2001, I think the members of this committee
    are primarily interested in the recent steps that we have taken
    to ensure the physical safety of our citizens, their property,
    and our constitutional freedoms.
        The painful losses of September 11 produced not only grief,
    but resolute action. With regard to homeland defense, our
    Department's capabilities fall essentially into two categories:
    the warfighting defense of the United States; and military
    support to civilian authorities following an enemy attack. I
    would like to address these issues in that order.
        Our primary responsibility within the DOD is not merely to
    respond to enemy attacks, but, more importantly, to deter and
    defeat them. Each day since September 11 the men and women of
    the North American Air Defense Command (NORAD), commanded by
    General Eberhart, have patrolled the air space over Canada and
    the United States. In a completely integrated effort of U.S.
    and Canadian capabilities, the United States Air Force, Air
    Force Reserve, and Air Force Air National Guard have protected
    the skies over major metropolitan areas, critical
    infrastructure, historic monuments, and government facilities.
        These dedicated professionals have executed over 34,000 air
    defense sorties and responded to over 1,700 requests from the
    Federal Aviation Agency (FAA) to intercept potential air
    threats. The number of flights and their location changes daily
    and each day's flight data is shared in advance with the DHS.
    This level of air security is unprecedented in our Nation's
    history.
        Nearly every homeland defense exercise which we now conduct
    includes a threat scenario involving a terrorist takeover of a
    commercial airliner. As a result, our air defense training is
    realistic, focused, and subject to well understood rules of
    engagement.
        We have implemented similar improvements in our domestic
    land defense capabilities. While fully recognizing that
    domestic counterterrorism is a lead law enforcement mission, we
    now have active duty soldiers and marines on alert every hour
    of every day, prepared to deploy to any location within the
    United States where a land defense against a terrorist attack
    might be required.
        Such quick reaction forces did not exist on September 11,
    2001. They do now and they are both trained and ready.
        Even more importantly, we are working closely with the
    National Guard Bureau to ensure that the Army Guard forces will
    be mission-ready to provide immediate land security within
    their own States. In my judgment, the protection of critical
    infrastructure will likely become a core National Guard mission
    during the next decade.
        It is also important to note that the DOD has recently been
    assigned, with the signing of Homeland Security Presidential
    Directive 7, a lead responsibility for the protection of the
    defense industrial base. The achievement of this new mission
    will require a close coordination of private and public,
    military and civilian, security capabilities. The task is both
    enormous and essential.
        We now recognize that a 21st century maritime defense
    requires a common operating picture of the maritime domain,
    real-time tracking of threat vessels, appropriate ships in
    resources to support maritime intercept operations on the high
    seas against terrorists potentially armed with weapons of mass
    destruction (WMD), and a command and control structure that
    maximizes both Navy and Coast Guard capabilities.
        Our goal is to defeat any maritime threats with an
    integrated, layered defense long before such threats are able
    to enter our ports. To that end, the Secretary of Defense
    recently signed an expanded maritime intercept operations
    execute order. Through realistic maritime exercises and
    unprecedented Navy-Coast Guard cooperation, we are making daily
    progress toward that goal.
        Similar improvements have been made with regard to DOD's
    ability to support civilian authorities following a terrorist
    attack. Thirty-two National Guard WMD Civil Support Teams
    (CSTs) have been trained, equipped, and certified by the DOD.
    Twelve new teams will be created this year. We are planning to
    establish a total of 55 CSTs, sufficient to ensure that every
    State and territory will be served by a CST.
        If a more substantial WMD response is required, we have
    established, equipped, and organized large Joint Task Forces
    (JTFs) at dispersed locations throughout the United States
    sufficient to ensure that we will be able to respond to
    multiple near-simultaneous terrorist attacks involving WMD.
    Although this capability is not fully developed, we are working
    hard and with a sense of urgency to get there.
        In my view, multiple simultaneous attacks are not only
    possible; they are fully consistent with terrorist operational
    doctrine. Even in the absence of a large-scale enemy attack,
    the DOD civil support responsibility is substantial. Last year
    DOD acted on 75 separate civil support requests from more than
    20 civilian agencies, including the January 2004 deployment of
    the Marine Corps' Chemical-Biological Incident Response Force
    to the Dirksen Building when ricin was detected in Senator
    Frist's office.
        Finally, we at DOD recognize that an effective defense
    against terrorist activity requires a close daily partnership
    between our Department and the newly-created DHS. Our missions
    are complementary and mutually reinforcing. To make certain
    that partnership is a reality, employees from my office now
    work full-time in the Homeland Security Operations Center.
        A Defense Coordination Office has been established by DOD
    personnel at DHS. A memorandum of agreement for mutual support
    has been negotiated between the two Departments, and I meet
    routinely and regularly with the senior DHS leadership. Our
    homeland security and homeland defense exercise programs have
    now been fully integrated. The scenarios are challenging and
    involve complete inter-agency participation.
        This summary should make it clear that DOD, working with
    our partners in public and private sectors at the local, State,
    and national levels, is fully committed to the most capable
    homeland defense ever planned or executed in our country's
    history. Despite great progress, we are not comfortable. We are
    not satisfied. Rather, we are dedicated with a real sense of
    urgency to ever-improving homeland defense capabilities.
        In that effort, our men and women in uniform stand in
    common cause with the members of this committee. Success in the
    global war on terrorism is a national imperative, our
    generation's greatest challenge.
        I look forward to your questions.
        [The prepared statement of Secretary McHale follows:]
                     Prepared Statement by Hon. Paul McHale
                                  introduction
        Chairman Warner, Senator Levin, distinguished members of this
    committee: Thank you for inviting me back to address the critical
    subject of our Nation's security. I appreciate the opportunity to
    return today to update you on our progress. When I appeared before this
    committee a year ago, new Department of Defense (DOD) organizational
    structures for homeland defense were still under development. With a
    continuing sense of urgency and focus, DOD has implemented substantial
    improvements in homeland defense capabilities over the past year,
    increasing the safety of the Nation. At the same time, there is no
    reason for complacency. We fully recognize that significant challenges
    lie ahead.
        Through prosecution of the global war on terrorism, DOD focuses on
    combating terrorism as far from our borders as possible. Thus, our
    first line of defense is abroad--to confront the enemy where they live,
    train, plan, and recruit, as we are doing today in Afghanistan and
    Iraq. The second line of defense also lies beyond the borders of the
    Nation--the air and maritime avenues of approach--where we will engage
    terrorists before they reach our borders. Inside our borders, the
    domestic law enforcement community is responsible for countering
    terrorist threats; DOD stands ready to provide capabilities in support
    of civil authorities, consistent with U.S. law.
        Within the Office of the Secretary of Defense (OSD), under the
    leadership of the Under Secretary of Defense for Policy, my office and
    that of my colleague, the Assistant Secretary of Defense for Special
    Operations and Low Intensity Conflict (ASD-SOLIC), work together to
    provide policy guidance and to supervise DOD's homeland defense and
    combating terrorism activities here in the United States and around the
    world. The combatant commanders of U.S. Northern Command (NORTHCOM) and
    U.S. Special Operations Command (SOCOM), also present today, lead our
    combating terrorism operations. Together, we combat terrorism at home
    and abroad, while diligently working to mitigate any potential policy
    and operational seams. My testimony today will address DOD homeland
    defense activities that have occurred since my last appearance, as well
    as the challenging work that lies ahead. Additionally, I will describe
    some of the key issues where homeland defense and combating terrorism
    intersect within our common fight against global terrorism.
         dod's role in the security of our nation: combating terrorism
        Within the DOD, our combating terrorism activities comprise four
    main areas:

             Antiterrorism--defensive measures taken to reduce
            vulnerabilities and protect our personnel, facilities, and
            resources against a terrorist incident;
             Counterterrorism--offensive response measures taken to
            deter, preempt, and resolve a terrorist act;
             Consequence Management--efforts to prepare for and
            respond to the aftermath of a terrorist event; and
             Intelligence--the collection, analysis, and
            dissemination of terrorism-related information.

        Within the OSD, the responsibility for combating terrorism involves
    three main entities. First, the Bob Stump National Defense
    Authorization Act for Fiscal Year 2003 (Public Law 107-314) assigned
    responsibility for the overall direction and supervision for DOD's
    combating terrorism activities to the Under Secretary of Defense for
    Policy.
        Second, in accordance with section 138(b)(4) of title 10, U.S.
    Code, my colleague, the ASD-SOLIC, is responsible for the overall
    supervision of DOD's special operations and low intensity conflict
    activities.
        Third, as requested by the Secretary of Defense, Public Law 107-314
    also established the Office of the Assistant Secretary of Defense for
    Homeland Defense (ASD-HD). I am honored to serve as the first ASD-HD.
    My office was established to assist the Secretary of Defense in
    improving policy and providing guidance to combatant commanders
    regarding the air, land, and maritime defense of U.S. territory and the
    provision of defense support to civilian authorities. As stated in the
    establishing statutory language, I provide overall supervision of the
    homeland defense activities of DOD.
           dod's role in the security of our nation: homeland defense
        Following the terrorist attacks on the United States of September
    11, at the direction of the President and with congressional support,
    DOD moved quickly to establish new organizations focused on homeland
    defense and civil support: NORTHCOM and the Office of the ASD-HD noted
    above.
        You will recall that on October 1, 2002, DOD activated NORTHCOM,
    headquartered in Colorado Springs, Colorado. NORTHCOM conducts
    operations within its assigned area of responsibility (AOR) to deter,
    prevent, and defeat threats and aggression aimed at the United States,
    its territories, and interests. Accordingly, as directed by the
    President or Secretary of Defense, the Commander, NORTHCOM, would
    direct military operations within its area of responsibility, including
    combat operations. In addition, when directed by the President or
    Secretary of Defense, the Commander, NORTHCOM, would also provide
    support to U.S. civil authorities, including military assistance to
    civil authorities, military support to civilian law enforcement
    agencies, military assistance for civil disturbances, and incident
    management operations in response to a weapon of mass destruction (WMD)
    attack.
        NORTHCOM's AOR includes the continental United States, Alaska,
    Canada, Mexico, and the surrounding water out to approximately 500
    nautical miles. The defense of Hawaii and U.S. territories and
    possessions in the Pacific remains the responsibility of U.S. Pacific
    Command (PACOM). The Commander of NORTHCOM is also the commander of the
    bi-national U.S.-Canada North American Aerospace Defense Command
    (NORAD). NORTHCOM achieved full operational capability on September 11,
    2003, and is fully able to conduct missions assigned to the command by
    the President in the Unified Command Plan.
        As the first combatant command with a primary mission to defend the
    land, sea, and air approaches to the United States, NORTHCOM operations
    extend to all three domains.
    Air domain
        NORAD guards, patrols, and monitors the airspace over Canada and
    the United States. Each and every day the men and women of the United
    States Air Force, United States Air Force Reserve, and the Air National
    Guard secure the skies over major metropolitan areas, our Nation's
    critical infrastructure, and historic monuments. Since September 11,
    2001, these dedicated professionals have executed over 34,000 air
    defense sorties and responded to over 1,700 requests from the Federal
    Aviation Administration (FAA) to intercept potential air threats.
    Maritime domain
        Similarly, the U.S. Navy monitors the sea approaches to the United
    States and works with the U.S. Coast Guard to patrol international
    waters and our territorial seas. On a daily basis, U.S. Navy sailors
    vigilantly monitor the blue water approaches to our Nation's
    territorial seas, operating under new and expanded authority to
    interdict vessels potentially bearing terrorists or their weapons
    before they reach our shores. Further, under Operation Noble Eagle,
    naval maritime surveillance and engagement forces are designated for
    transfer to NORTHCOM command and control when directed by the Secretary
    of Defense.
    Land domain
        The Homeland Security Act of 2002 (Public Law 107-296) assigns the
    Secretary of Homeland Security the responsibility for the security of
    the Nation's borders. That responsibility includes preventing
    terrorists and instruments of terrorism from penetrating our borders,
    protecting our ports of entry, immigration enforcement, and ensuring
    the speedy, orderly, and efficient flow of lawful traffic and commerce.
    DOD's role in that border security mission is to provide support to
    civil authorities, principally the Department of Homeland Security
    (DHS), when appropriate. DOD has established and maintains Quick
    Reaction Forces and Rapid Reaction Forces, which, when deployed, will
    operate under NORTHCOM command and control. These highly trained U.S.
    Army and Marine Corps personnel are postured to respond to the full
    range of potential threats to the United States.
                homeland defense and homeland security exercises
        DOD is committed to maintaining the readiness of military forces to
    execute the full spectrum of homeland defense operations and to support
    civil authorities, when necessary and appropriate. To this end, DOD has
    hosted its own exercises and participated in exercises sponsored by
    other government entities. Over the last year, these included: Unified
    Defense (February 2003); TOPOFF 2 (May 2003); Determined Promise
    (August 2003); Livewire (October 2003); Unified Defense (February
    2004); and Senior Official Exercise #3 (March 2004). These exercises
    addressed a range of potential threats to the United States, from cyber
    attacks to bioterror attacks, and from radiological attacks to a
    nuclear detonation. The exercises support the DHS National Homeland
    Security Exercise Program established by the December 2003 Homeland
    Security Presidential Directive-8 (HSPD-8) on National Preparedness.
    Homeland security and homeland defense exercises are critical in
    identifying gaps and potential weaknesses within each agency and across
    agencies in responding to terrorist attacks, including multiple,
    simultaneous challenges.
               dod support of critical infrastructure protection
        The Homeland Security Act of 2002 (Public Law 107-296) assigned DHS
    the responsibility to develop a comprehensive national plan to protect
    our Nation's critical infrastructure and key assets. The National
    Strategy to Secure Cyberspace (February 2003) and the National Strategy
    for the Physical Protection of Critical Infrastructure and Key Assets
    (February 2003), as well as HSPD-7 on Critical Infrastructure
    Identification, Prioritization, and Protection (December 2003),
    designate DOD as the sector-specific agency for the Defense Industrial
    Base sector. This designation recognizes DOD's important role in the
    protection of critical defense installations and facilities. In this
    capacity, DOD must work closely with private sector owners of critical
    defense infrastructure to deter, mitigate, or neutralize terrorist
    attacks in order to sustain military operations.
        In September 2003, the Secretary of Defense assigned me the
    responsibility for Defense Critical Infrastructure Protection. Since
    then, we have consolidated Critical Infrastructure Protection (CIP)
    funding within the OSD into a single program, managed by the newly
    established Defense Program Office for Mission Assurance. Under my
    oversight, this office conducts focused research and development using
    a systems approach for CIP activities supporting DOD missions. We have
    also taken steps to increase the preparedness of critical defense
    installations and facilities against chemical, biological,
    radiological, and nuclear threats. Pentagon efforts are helping to
    develop DOD-wide installation preparedness standards and requirements,
    which we will apply at 200 other key installations over the next few
    years.
                         dod relationship with the dhs
        DOD focuses on and is responsible for homeland defense, which is
    the protection of United States territory, domestic population, and
    critical defense infrastructure against external threats and
    aggression. It also includes routine, steady-state activities designed
    to deter aggressors and to prepare U.S. military forces for action if
    deterrence fails. DHS, on the other hand, focuses on homeland security,
    which is defined in the 2002 National Strategy for Homeland Security as
    ``a concerted national effort to prevent terrorist attacks within the
    United States, reduce the vulnerability of the United States to
    terrorism, and minimize the damage and assist in the recovery from
    terrorist attacks.''
        In simpler terms, the Defense Department provides the military
    defense of our Nation from all attacks that originate from abroad,
    while DHS protects the Nation against, and prepares for, acts of
    terrorism. DOD is organized and prepared, however, at the direction of
    the President and the Secretary of Defense, to play a vital role in
    support of the DHS mission.
        As the Secretary of Defense's principal representative to the DHS,
    I have worked hard to build upon our excellent working relationships
    throughout the DHS. We have nearly completed a memorandum of agreement
    with DHS, under which DOD will continue to provide, some 64 detailed
    personnel to DHS to fill critical specialties, principally in the areas
    of communications and intelligence. We have also established a 24/7 DOD
    presence in the DHS Homeland Security Operations Center with direct
    connectivity back to DOD for rapid response. Additionally, we
    established planning teams to assist the DHS Interagency Incident
    Management Group--a group of senior interagency officials focused on
    incident response. This year, we are further enhancing our partnership
    with DHS by establishing a DOD advisory and liaison office--called the
    Homeland Defense Coordination Office--within DHS headquarters.
        In accordance with section 1401 of Public Law 107-314, I also serve
    as the ``senior official of the DOD to coordinate all DOD efforts to
    identify, evaluate, deploy, and transfer to Federal, State, and local
    first responders technology items and equipment in support of homeland
    security.'' In that capacity, I work closely with the DHS Under
    Secretary for Science and Technology (S&T). Recent examples of
    technology transfer initiatives include: information-sharing systems,
    such as the Disaster Management Interoperability Services; biometrics
    identification technologies; ground sensors and their application in
    border security; and unmanned aerial vehicle experimentation.
    Additionally, new Advanced Concept Technology Demonstration (ACTD)
    efforts are underway that have the potential to deliver capabilities
    supporting both DOD missions abroad and DHS missions at home.
              dod relationship with the homeland security council
        The President established the Office of Homeland Security (OHS) and
    the Homeland Security Council (HSC) on October 8, 2001 to develop and
    implement a comprehensive national strategy to secure the United States
    from terrorist threats. In the Homeland Security Act of 2002, Congress
    created the DHS and codified the HSC. DOD coordinates with the
    Assistant to the President for Homeland Security and staff as
    appropriate. The Secretary of Defense is, along with the President,
    Vice President, Secretary of Homeland Security, and the Attorney
    General, a statutory member of the HSC. DOD worked closely with the OHS
    from October 2001 to March 2003, and continues to do so with its
    successor, the HSC staff.
        As ASD-HD, I am DOD's principal representative to the HSC staff. My
    office represents DOD on the HSC's interagency policy coordination
    committees (PCCs) and subordinate working groups, with the
    participation of other DOD offices as appropriate. From personal
    experience, I can attest that the HSC has become an effective forum for
    interagency communication on homeland security and homeland defense
    matters, including evaluation of terrorist threats and the development
    of responses in a crisis environment. As one recent example, the HSC
    functioned effectively throughout the tense weeks of Code Orange alert
    during the December 2003 holiday season.
                      defense support to civil authorities
        DOD has a long tradition of support to civil authorities as
    necessary and appropriate while maintaining its primary mission of
    fighting and winning the Nation's wars. Since my last testimony before
    this committee, DOD has continued to lend necessary assistance to civil
    authorities when they were overwhelmed or faced with challenges
    necessitating the Department's unique capabilities. Last year we acted
    on 75 requests for assistance from more than 20 civilian agencies,
    including DHS, the Department of Justice, the Department of Health and
    Human Services, the Department of Transportation, the Department of
    State, the National Air and Space Administration (NASA), the U.S.
    Marshals Service, and the National Interagency Fire Center. To provide
    several brief examples of civil support activities last year, DOD
    provided emergency support in natural disasters such as Hurricane
    Isabel in September 2003 and the October 2003 California wildfires. DOD
    also provided support in responding to incidents such as the Columbia
    space shuttle accident in February 2003 and the January 2004 ricin
    incident on Capitol Hill. For the latter, NORTHCOM's Joint Force
    Headquarters-National Capitol Region, in its first operational use,
    provided command and control of U.S. Marine Corps Chemical-Biological
    Incident Response Force assistance to the U.S. Capitol Police.
                 internal dod combating terrorism collaboration
        As described at the outset, combating terrorism includes a spectrum
    of activities that do not correspond neatly with geographic boundaries
    on a map or organizational boundaries within agencies. For example, the
    ongoing crisis in Haiti clearly requires the type of stability
    operations expertise resident in the office of the ASD-SOLIC. At the
    same time, in light of Haiti's proximity to the United States and
    potential homeland security dimensions of the situation, my office has
    been instrumental in facilitating coordination with DHS, the overall
    lead Federal agency on the migration aspects of this evolving issue.
    Similarly, terrorist use of manportable air defense systems (MANPADS)
    is a threat that does not respect borders. Thus, my office participates
    in an Interagency MANPADS Task Force to advance measures to reduce the
    vulnerability of aircraft to missile attacks domestically, while the
    ASD-SOLIC participates in interagency efforts to deny terrorists access
    to missiles throughout the world.
        The witnesses testifying before you today work diligently to ensure
    that ``seams'' do not hinder our combating terrorism efforts as we work
    to deter, dissuade, defend, and defeat potential terrorist attacks
    against the United States and our interests around the world.
    Antiterrorism
        Within the United States, the military departments are responsible
    for force protection and taking appropriate defensive antiterrorism
    measures to protect their military facilities and personnel. Outside
    the United States, regional combatant commanders have these
    responsibilities. We are currently in the process of examining policy
    options for antiterrorism and force protection for DOD facilities and
    personnel within the United States to determine whether any changes are
    needed in the assignment of these responsibilities.
    Counterterrorism
        Offensive measures overseas to deter and preempt terrorist attacks,
    largely a mission for Special Operations Forces, are crucial to
    preventing terrorist activities against the United States. For overseas
    counterterrorism operations, we rely on ASD-SOLIC for policy oversight
    and the Commander, SOCOM, for their execution. Domestic
    counterterrorism is first and foremost a civilian law enforcement
    function. By design, DOD's counterterrorism role within the United
    States is constrained. DOD provides military support to civilian law
    enforcement agencies (MSCLEA) consistent with applicable law and under
    my supervision. Authorized support under title 10, U.S. Code includes
    information sharing, loan of equipment and facilities, expert advice
    and training, and maintenance and operation of equipment.
    Consequence Management
        The preparations for and response to terrorist events vary
    depending on the location of an incident. My office is responsible for
    DOD's support to civil authorities for domestic incident management,
    while ASD-SOLIC is responsible for DOD's support to the Department of
    State, which has the lead for foreign disaster assistance and foreign
    consequence management. There are multiple linkages between incident
    and consequence management, however. These include sharing information
    obtained in the course of incident and consequence management-related
    interagency deliberations and relevant exercises. Through formal
    bilateral exchanges and visits with our allies and friends, we also
    engage in information sharing and coordination regarding the
    preparedness and consequence management activities of other nations.
    These activities not only enhance preparedness and response
    capabilities across the board, but also strengthen our alliances in the
    global war on terrorism.
        In the case of a domestic WMD attack, as necessary and appropriate,
    the Joint Task Force Civil Support headquartered in Norfolk, Virginia;
    the Joint Task Force Consequence Management East headquartered at Fort
    Gillem, Georgia; or the Joint Task Force Consequence Management West
    headquartered at Fort Sam Houston, Texas; under the command and control
    of the Commander, NORTHCOM, would be available to provide incident
    management support to civil authorities. Additionally, we are working
    to strengthen DOD and civilian capabilities and surge capacity to
    address multiple, simultaneous chemical, biological, radiological, or
    nuclear (CBRN) attacks in the United States.
    Intelligence and Information Sharing
        Throughout DOD we work closely with the constituent elements of the
    Intelligence Community to maintain maximum awareness of potential
    attacks against and emerging threats to the United States. My office
    and the office of the ASD-SOLIC both engage actively with the Under
    Secretary of Defense for Intelligence (USD-I), established in 2003 by
    Public Law 107-314, on all intelligence matters. USD-I is charged with
    ensuring that the senior DOD leadership receives the warning,
    actionable intelligence, and counterintelligence support needed to
    pursue all of the objectives of the updated defense strategy, including
    defense of the homeland. USD-I also provides a single point of contact
    for coordination of national and military intelligence activities with
    the Community Management Staff under the Director of Central
    Intelligence (DCI) and strengthens the relationship between the
    Secretary of Defense and the DCI.
        Additionally, DOD is a full partner in the Terrorist Threat
    Integration Center (TTIC), a multi-agency joint venture announced by
    the President in the January 2003 State of the Union address and
    launched in May 2003. TTIC integrates terrorist-threat related
    information, minimizing any seams between analysis of terrorism
    intelligence collected overseas and inside the United States, to form a
    comprehensive threat picture. On a daily basis, TTIC coordinates
    terrorist threat assessments with partner agencies, including DOD, DHS,
    the Federal Bureau of Investigation (FBI), the Central Intelligence
    Agency (CIA), and the Department of State.
                 additional internal dod areas of collaboration
        In addition to collaboration across the range of combating
    terrorism activities, the ASD-HD, ASD-SOLIC, NORTHCOM, and SOCOM also
    work together on other issues where there is a nexus between combating
    terrorism and other functional activities.
    Counternarcotics
        Counternarcotics is an area in which DOD has longstanding
    relationships with civil authorities, including U.S. border and law
    enforcement officials. By statute, DOD is the lead Federal agency for
    the detection and monitoring of aerial and maritime movement of illegal
    drugs toward the United States. DOD works with civil authorities to
    transmit information to enable law enforcement authorities to interdict
    such trafficking. DOD also supports requests from the Department of
    Justice, DHS, and the High Intensity Drug Trafficking Area (HIDTA) Task
    Force Headquarters for unique military assistance, such as
    reconnaissance (ground-based, aviation-based, and maritime), logistics,
    transportation, engineer support along the southwest U.S. border, as
    well as intelligence programs and training.
        Within the Office of the Secretary of Defense, ASD-SOLIC has the
    overall lead for DOD's counternarcotics activities, with assistance
    from the office of the ASD-HD, on issues with domestic implications.
    Since September 11, policy and operational changes in DOD have improved
    the alignment of resources and efforts where there is a link between
    terrorism and narcotics trafficking. Additionally, NORTHCOM is now
    charged with counternarcotics activities in its area of responsibility,
    including counternarcotics support to domestic law enforcement
    authorities and command of Joint Task Force-6 (JTF-6), headquartered in
    El Paso, Texas.
        Further areas of cooperation related to counternarcotics include:

             ASD-HD support to ASD-SOLIC on drug interdiction and
            counternarcotics activities plans developed by U.S. states and
            territories in accordance with section 112 of title 32, United
            States Code;
             Collaboration to shape the future of JTF-6, originally
            established in November 1989 to provide DOD counternarcotics
            support to Federal, regional, State, and local law enforcement
            agencies and assigned since October 1, 2002 as a component of
            NORTHCOM; and
             DOD installation of secure internet systems in many of
            the HIDTA intelligence centers across the United States that
            facilitate sharing of counternarcotics-related information with
            national security and homeland security value.
    Technology research and development
        Research and development (R&D) represents a final area of combating
    terrorism collaboration. DOD invests nearly $100 million yearly in the
    Technical Support Working Group (TSWG), a U.S. national forum that
    brings together over 85 Federal agencies to identify, prioritize, and
    coordinate interagency and international research and development
    requirements for combating terrorism. Within DOD, the ASD-SOLIC is the
    executive director and proponent for TSWG. The TSWG rapidly develops
    technologies and equipment to meet the high-priority needs of the
    combating terrorism community. Many of these technologies are also
    applicable to first responders and other homeland security missions. In
    recognition of that synergy, DHS has joined as a partner in the TSWG,
    and TSWG staff are also members of the Homeland Defense Technology
    Working Group.
                                   conclusion
        Throughout our history, U.S. military forces--Active Duty, National
    Guard, and Reserves--have defended our Nation against its enemies on
    land, at sea, and in the air, adapting continuously to engage threats
    to our Nation.
        Today we face a challenge that is equal to or greater than any we
    have ever faced before. We must cope not only with the threats produced
    by the proliferation of WMD and missile technology among nation-states,
    but also with WMD threats posed by individual terrorists and terrorist
    organizations with global reach.
        Throughout DOD we are transforming, increasing our capabilities for
    combating terrorism and homeland defense on a daily basis, while
    continuing a long tradition of support to civil authorities. Homeland
    defense and homeland security are featured on Secretary Rumsfeld's top
    priorities list for this year. To support his priorities, we intend to
    develop a comprehensive Homeland Defense Strategy for the 21st century.
    This strategy will support the National Security Strategy, the National
    Strategy for Homeland Security, and the updated Defense Strategy. It
    will also provide the framework for pursuing operational capabilities
    to prepare for tomorrow's challenges.
        Mr. Chairman, I commend you and the members of this committee for
    your continued interest in and efforts in support of the Department's
    combating terrorism and homeland defense missions. The citizens of this
    Nation, its institutions, and our brave men and women in uniform have
    repeatedly demonstrated the patriotism, toughness, innovation,
    determination, and resiliency to defeat our enemies while retaining our
    freedoms. There is no doubt in my mind that those capabilities will be
    tested against this newest enemy threat--nor is there any doubt that we
    will prevail.

        Chairman Warner. Thank you very much, Mr. Secretary.
        It is interesting. Those of us that had an opportunity to
    follow the hearing in this very room yesterday where there was
    so much controversy over what we are doing, what we are not
    doing--your statement this morning and I expect that of General
    Eberhart lays down very clearly the established factual path of
    what has been done.
        I must remark on the CSTs. I worked with Secretary Cohen
    when he was on this committee and when he went to the DOD. He
    initiated them. We thought we only needed five, and then I am
    proud that this committee, under sequential leadership, has
    supported the increase of those teams to 55
        Secretary McHale. Yes, sir.
        Chairman Warner. That is a commendable step.
        General, we will hear from you. I enjoyed our visit
    yesterday and I hope in the course of the statement you are
    going to talk a little bit about some of that special work that
    you have been performing here in this great Nation's capital.

     STATEMENT OF GEN. RALPH E. EBERHART, USAF, COMMANDER, UNITED
        STATES NORTHERN COMMAND, AND COMMANDER, NORTH AMERICAN
                       AEROSPACE DEFENSE COMMAND

        General Eberhart. Yes, sir. Mr. Chairman, once again it is
    an honor and a privilege to be with you representing the men
    and women of NORAD and NORTHCOM. I echo the statements of my
    colleagues in thanking the members of this distinguished
    committee under your leadership for your continued support of
    the men and women who serve this great Nation. They are
    motivated, they are dedicated, they are selfless in their
    service, and they appreciate your support and they deserve no
    less.
        It is also an honor to testify this morning along with my
    distinguished colleagues and my good friends, our partners as
    we wage this global war on terrorism, especially Secretary
    McHale, as we work the homeland defense and the homeland
    security aspects.
        What a difference a year makes, Mr. Chairman. We were with
    you a year ago. At that time we were in the process of re-
    engineering NORAD to look inward as opposed to outward, and
    Secretary McHale has given you the details, and we welcome your
    questions.
        We also at that time were 43 percent manned in NORTHCOM.
    Today I am glad to report, with your support and the support of
    the Services, we are 85 percent manned, on our way to over 90
    percent this summer. But more importantly, under our belt we
    have many events that we have participated in very
    successfully, and several of those, as you mentioned, Mr.
    Chairman, have been here in the national capital region, from
    support to the State of the Union Address to the ricin incident
    that Secretary McHale noted.
        We have reorganized, where we have a joint force
    headquarters for the national capital region, so no longer is
    it a pickup game in terms of the operational employment of DOD
    forces. There is a single belly button, if you will, that we
    have here in the national capital region to provide for the
    safety and security of the citizens of this great Nation and to
    protect our infrastructure.
        As we look ahead, as we talked about yesterday, there has
    been good news and bad news. The good news is we have come a
    remarkable distance. We have accomplished, in my view,
    remarkable things. I stand in awe of my colleagues who have
    been fighting what I call the ``away game,'' taking the fight
    to the enemy. That is the right way to win this global war on
    terrorism, to ensure there is no sanctuary, to capture and kill
    terrorists wherever we find them in the world, and to execute
    that away game.
        We also have to be prepared to fight the home game. Sadly
    and tragically, that was evidenced on September 11, and that is
    what we are all about in NORTHCOM and NORAD, and we are
    committed to do just that with your support. We must keep the
    pace, we must keep the momentum, we must remain alert, because
    I guarantee you that terrorists are waiting for us to let down
    our guard and when we do they will strike again.
        I look forward to your questions, Mr. Chairman.
        [The prepared statement of General Eberhart follows:]
               Prepared Statement by Gen. Ralph E. Eberhart, USAF
        Chairman Warner, Senator Levin and members of the committee: Thank
    you for this opportunity to appear before you again and to represent
    the outstanding men and women of North American Aerospace Defense
    Command (NORAD) and United States Northern Command (NORTHCOM). The
    soldiers, sailors, airmen, marines, Coast Guardsmen, National
    Guardsmen, reservists, and civilians serving in our commands are the
    foundation for deterring and defending threats to the U.S. and Canadian
    homelands. Due to their efforts, North America enjoys freedom and
    security.
                                     norad
        NORAD is a bi-national U.S. and Canadian command that is
    responsible for the aerospace defense of North America. NORAD ensures
    U.S. and Canadian air sovereignty against an ever-expanding range of
    threats and provides surveillance and warning of ballistic missile
    attack. Securing the skies of North America is our top priority.
    Operation Noble Eagle
        NORAD maintains a robust defense against asymmetric air threats to
    the U.S and Canada with a series of alert fighters, tankers and
    airborne early warning aircraft cued by interagency warning and
    networked surveillance radars. NORAD also operates an Integrated Air
    Defense System consisting of ground-based air defense capabilities in
    the U.S. National Capital Region. In the past year, NORAD flew more
    than 6,000 sorties in support of Operation Noble Eagle, with Air
    National Guard and Reserve component aircraft flying 77 percent of
    them. Since the September 11 attacks, NORAD has flown more than 34,000
    sorties and scrambled or diverted fighters more than 1,700 times in
    response to potential threats, all without a single mishap.
    Exercises
        In 2003, NORAD participated in 29 homeland defense exercises. The
    largest exercise, called Vigilant Overview, involved over 1,000 people.
    Common Operational Picture
        NORAD and NORTHCOM are working hand in hand to develop a common
    operational picture that incorporates data from air, land, sea, and
    space-based surveillance platforms, as well as information from
    intelligence, law enforcement and civil sources. As part of this
    effort, we are expanding data link capability across North America to
    make a common operational picture available for commanders at all
    levels to give them the situational awareness they need to make sound
    and timely decisions.
    Bi-National Planning Group
        In December 2002, the U.S. and Canadian governments established the
    Bi-National Planning Group to improve defenses against maritime and
    land-based threats to North America, as well as to coordinate our
    Nations' capabilities to respond to natural disasters. An early result
    of their efforts is that we now have bi-national awareness of maritime
    vessels of interest for the U.S. and Canada and are sharing information
    on assets available to deal with potential threats.
    Federal Aviation Administration (FAA) Integration
        We are grateful to the FAA for their cooperation and technical
    support as we work to improve NORAD's surveillance and command and
    control capabilities. We have partnered with the FAA to install
    approximately 300 radios in FAA facilities to provide NORAD controllers
    the means to communicate with fighter pilots throughout our country. We
    also established connectivity with 70 FAA long-range interior radars
    and have plans to integrate an additional 39 FAA terminal/approach
    control radars into our command and control network by the end of this
    year.
                                    northcom
        NORTHCOM stood up on October 1, 2002, to counter external threats
    and aggression to our Nation. We also command and control forces in
    emergency and domestic circumstances where the Secretary of Defense has
    approved military support. These are not new missions for the military.
    What is new is that these missions now have the full-time attention of
    a combatant command.
    Full Operational Capability
        NORTHCOM achieved full operational capability on September 11,
    2003, 2 years after the September 11 terrorist attacks. This was based
    on an in-depth evaluation of our proven ability to execute missions in
    real-world circumstances, as well as during rigorous validation
    exercises.
    Operations
        During the past year, we conducted homeland defense and military
    assistance operations for pre-planned events and emergencies. A summary
    of our recent operations follows:

         Support to the U.S. Capitol Hill Police. In February 2004,
    in support of the U.S. Capitol Police, we activated Joint Task Force
    National Capital Region (JTF-NCR) to respond to ricin contamination
    within the U.S. Capitol complex. The JTF-NCR deployed a 145-person U.S.
    Marine Corps Chemical Biological Incident Response Force to assist in
    environmental assessment and decontamination of congressional office
    buildings.
         Support to the State of the Union Address. In January
    2004, in support of the U.S. Secret Service, we provided command and
    control of all military support to the State of the Union Address, to
    include security, emergency medical, chemical and biological response
    forces.
         Response to Increased Threat Level. We were fully engaged
    with national leadership, the Intelligence Community and our
    interagency partners to ensure the security and safety of our Nation
    during the late 2003-early 2004 high threat advisory period. NORAD and
    NORTHCOM increased alert levels and the number of aircraft available to
    respond to flights of interest. We also heightened force protection
    levels and shortened the response timeline for Quick Reaction Forces.
         California Wildland Fire Fighting. In October 2003, at the
    request of the National Interagency Fire Center (NIFC), NORTHCOM
    responded to the Southern California fires. We deployed eight C-130
    aircraft equipped with Modular Airborne Fire Fighting Systems (the
    entire Department of Defense (DOD) fleet), six Marine Corps
    helicopters, a liaison officer at NIFC Headquarters and a Defense
    Coordinating Officer with a Defense Coordinating Element. March Air
    Reserve Base served as a Federal Emergency Management Agency (FEMA)
    mobilization center.
         Support to 58th United Nations (U.N.) General Assembly. In
    September and October 2003, at the request of the U.S. Secret Service
    and the Department of State, we supported the 58th U.N. General
    Assembly with over 200 service members. We provided a command and
    control element and extensive explosive ordnance support.
         Support to Hurricane Isabel Operations. In September 2003,
    Hurricane Isabel, a Category Two hurricane, made landfall on the North
    Carolina coast with winds in excess of 100 miles per hour, causing
    millions of dollars of damage in its path. At the request of FEMA,
    NORTHCOM deployed Task Force-East (First Army at Forest Park, Georgia)
    and provided Defense Coordinating Officers to Maryland, Virginia, and
    North Carolina. We also used Fort Bragg, North Carolina; Pope Air Force
    Base, North Carolina; Fort A.P. Hill, Virginia; and the Defense Supply
    Center Columbus, Ohio, as mobilization, flight operations and FEMA
    storage centers.
         Montana Wildland Fire Fighting. In August 2003, at the
    request of the NIFC, we established Task Force Steel Dragon to support
    fire fighting efforts in Montana. We deployed an Army Battalion of fire
    fighters (over 500 soldiers) and a medical evacuation helicopter, as
    well as a Defense Coordination Officer with a Defense Coordinating
    Element and a liaison officer to NIFC Headquarters.
         Support to Operation Iraqi Freedom (OIF). NORTHCOM has
    protected critical defense infrastructure and air and seaports of
    interest for units deploying and redeploying in support of OIF.
    Organizational Refinements
        We are reorganizing our forces to improve our ability to defend and
    protect American citizens. This spring we will stand down the Joint
    Force Headquarters Homeland Security (a provisional unit) and establish
    a Standing Joint Force Headquarters North (SJFHQ-North). SJFHQ-North
    will be a full-time, trained and equipped, joint command and control
    element collocated with NORTHCOM. It will operate as an integrated part
    of NORTHCOM's planning and operations, but will focus on potential
    near-term trouble spots. SJFHQ-North is projected to achieve full
    operational capability by October 1, 2004.
        We are working with the interagency to transform JTF-6 in El Paso,
    Texas into Joint Interagency Task Force North (JITF-North) to engage
    transnational threats against our Nation. In doing this, we are
    leveraging 14 years of expertise of providing support to Federal,
    State, tribal, and local counterdrug law enforcement agencies.
    Efforts to Share Intelligence with Federal, State and Local Officials
        To perform our mission, we rely on the sharing of actionable
    intelligence among Federal, State, and local agencies. Our Combined
    Intelligence and Fusion Center coordinates the acquisition, analysis
    and fusion of intelligence, counterintelligence, and law enforcement
    information for the NORTHCOM area of responsibility (AOR) and shares
    that information with organizations at the national, State, and local
    levels.
        We have made significant progress in improving the exchange of
    threat information. During the 2003-2004 holiday season, the entire
    homeland security and defense community pulled together, with time-
    sensitive information moving quickly from intelligence and law
    enforcement agencies to the decisionmakers who were challenged with
    mitigating various threats.
    Maritime Interception Operations
        NORTHCOM supports the Department of Homeland Security (DHS) in
    maritime homeland security, as needed. The U.S. Coast Guard has primary
    responsibility for maritime security in the approaches to the United
    States. NORTHCOM is tasked with identifying and intercepting maritime
    threats as far from our shores as practical. In coordination with
    interagency partners, we conduct maritime interception operations to
    degrade and disrupt terrorist acts, collect intelligence and prevent
    attacks against the U.S.and its allies.
    Exercises
        NORTHCOM sponsors two large-scale exercises annually: Determined
    Promise and Unified Defense. Our exercise scenarios have involved air,
    maritime and port threats; consequence management operations;
    protection of critical infrastructure; maritime interception
    operations; bioterrorist attacks; weapons of mass destruction and
    natural disasters. To date, over 57 State and Federal agencies have
    participated in our exercises. We continue efforts to increase
    international participation with Canada and Mexico. In February 2004,
    Canadian representatives observed Exercise Unified Defense at
    Headquarters NORAD-NORTHCOM; representatives from Mexico observed the
    exercise at Headquarters, Fifth Army, Fort Sam Houston, Texas.
    National Exercise Program
        We have worked with the DHS to synchronize our exercise program
    with the national homeland security exercise program, which will
    exercise the National Response Plan and the National Incident
    Management System. When fully implemented, the national homeland
    security exercise program will consist of one large-scale exercise per
    year, alternating between top officials in odd years and Unified
    Defense in even years. NORAD-NORTHCOM will continue to conduct the
    Determined Promise exercise series each year.
    Theater Security Cooperation with Canada
        NORTHCOM has developed objectives, tasks, and milestones to expand
    defense cooperation with Canada in the maritime, land, and civil
    support domains. We look forward to having a series of shared
    contingency plans and cooperative procedures for bi-national defense
    and support to civil authorities with Canada.
    Theater Security Cooperation with Mexico
        We are leveraging existing relationships with the Mexican military
    and are pursuing efforts to expand assistance to Mexico using
    counterterrorism and counterdrug funding. In addition, we are working
    with the National Guard to develop new training opportunities with the
    Mexican military in a variety of areas, such as biohazard and weapons
    of mass destruction incident management.
    Bioterrorism Preparedness and Response
        NORTHCOM has the capability to assist local, State, and Federal
    authorities with planning and exercising to improve response to a
    bioterrorism attack. We provide trained experts in the areas of
    chemical, biological, and radiological incidents at the request of a
    lead Federal agency to help prevent or contain an epidemic and respond
    to an actual attack.
                            northcom's relationships
    Interagency
        We have increased our level of commitment and involvement with
    interagency partners over the past year. Our Joint Interagency
    Coordination Group (JIACG) continues to be a force multiplier for the
    NORTHCOM across the board. The JIACG is comprised of 46 DOD and non-DOD
    agency representatives that include the Department of State, Department
    of Transportation, Central Intelligence Agency (CIA), FEMA, National
    Geospatial-Intelligence Agency, U.S. Coast Guard, FAA, Federal Bureau
    of Investigation (FBI), Immigration and Customs Enforcement, U.S. Army
    Corp of Engineers, U.S. Geological Survey, and Sandia National
    Laboratories.
    Other Combatant Commands
        We have established the framework for a layered defense of the
    homeland in coordination with U.S. Joint Forces Command, U.S. Pacific
    Command (PACOM), U.S. Southern Command (SOUTHCOM), U.S. Special
    Operations Command (SOCOM), U.S. Strategic Command (STRATCOM), and U.S.
    Transportation Command (TRANSCOM). We are also working with the other
    regional combatant commands to eliminate threats to our homeland from
    outside our AOR. Our focus is to address and resolve gaps in coverage,
    as well as any overlapping responsibilities. In addition, strengthening
    these relationships further facilitates time-sensitive information
    exchanges to ensure emerging threats are visible to intelligence and
    law enforcement officials.
    National Guard Bureau
        We have a strong relationship with the National Guard Bureau to
    execute homeland defense and homeland security missions, and we
    continue to seek ways to make it better. For instance, in order to
    improve awareness of our state of readiness and response, we are
    working on a robust information sharing network.
       potential future missions and capabilities for norad and northcom
    Integrated Missile Defense
        As the combatant command tasked with defense of our homeland,
    NORTHCOM will be responsible for execution of the Ground-based
    Midcourse Defense (GMD). In coordination with the Joint Staff, PACOM,
    STRATCOM, and the Missile Defense Agency, we are refining operational
    concepts, command and control structures and establishing command
    relationships to ensure the effective employment of the GMD system when
    it becomes operational.
    High Altitude Airship Advanced Concept Technology Demonstration
        The Office of the Secretary of Defense (OSD), NORAD, the U.S. Army,
    and the Missile Defense Agency are teamed to demonstrate the technical
    feasibility and military utility of an unmanned, untethered, long-
    duration High Altitude Airship (HAA). The HAA will allow NORAD to look
    over-the-horizon throughout North America and out from our coastal
    waters for air, ground and maritime-based threats.
    Full Spectrum Wide Area Surveillance
        The current homeland air surveillance system consists of multiple
    independent ground-based radar systems that are approaching or have
    exceeded their life expectancy and require modifications for continued
    operations. We are working to address sustainment issues to maintain
    the current capability until advanced technologies are available to
    improve our ability to detect, identify and track threats.
        Our ultimate objective is to field a wide area surveillance
    capability in the air and maritime domain that seamlessly connects all
    NORAD and NORTHCOM command elements with DOD, Canada, and other
    agencies. This objective system will reduce gaps in coverage and allow
    the sharing of surveillance data among pertinent U.S. and Canadian
    authorities.
    Homeland Security/Homeland Defense Command and Control Advanced Concept
            Technology Demonstration (HLS/HLD C2 ACTD)
        NORTHCOM is sponsoring the HLS/HLD C2 ACTD. We are working with the
    Assistant Secretary of Defense for Homeland Defense to identify DOD and
    non-DOD participants who can benefit from demonstrated information
    sharing technologies. Solutions showcased during this venue will
    provide the homeland security and defense communities with cutting-edge
    technologies that improve information sharing, collaboration and
    decision making in a trusted information exchange environment.
                                   conclusion
        The defense of our homeland depends on the dedication,
    professionalism, and sacrifice of the men and women in our commands. We
    appreciate what the members of this committee have done to improve the
    quality of life for our service members. The National Defense
    Authorization Act for Fiscal Year 2004 reflects your concern for the
    members of our Armed Forces. We are grateful for your support. With
    your help, we will continue to strengthen our ability to protect our
    Nation's citizens where they live and work.

        Chairman Warner. Well, thank you, General, and I share in
    your observation about the threat. But I think in our prayers
    we must express our thankfulness that we have not had a major
    incident since September 11. I do not care how you want to
    argue all of this, who did what, when, why, and who did not. I
    think it is largely owing to what we have done, and we have
    done a lot.
        In this testimony this morning, you laid down the case of
    how much has been done and I was struck by the 1,700 missions
    you have had to fly where there was some question about a
    civilian aircraft operating in this country. You had to bring
    one of your own aircraft to close in and surveil that aircraft
    to make certain there was no aberration or otherwise that
    necessitated stronger action. Well, a lot has changed.
        Let us go to the first round of questions for our
    witnesses. Perhaps you have not had a full opportunity to study
    Secretary Rumsfeld's commendable and very well thought out plan
    by which he is going to diminish significant forward elements
    in size, leaving of course what he deems necessary. But that
    seems to me to put more emphasis on your particular area of
    responsibility (AOR) to have quick reaction forces to move in
    with these reduced units and supply such additional support as
    they may need.
        Which of you gentlemen would like to lead off on that?
    Secretary O'Connell or General Brown?
        Secretary O'Connell. I would be happy to, sir. I have had a
    chance just to glance at it. More importantly, in terms of the
    testimony you referred to, I have been present occasionally
    when some of these concepts have been developed. I have looked
    at issues as I see them developing in possible changes in the
    global footprint that may have an impact on SOCOM, and I will
    leave the operational details to General Brown.
        Are we going to be able to continue to support the
    combatant commanders with SOF that are working for them? The
    second thing we look at is, in terms of how the world is
    changing, who are our new friends and who are our new enemies,
    who are our old enemies, and where should we be positioned near
    them?
        We look carefully across the entire range of special
    operations, and of course we are talking about the maritime
    assets, the SEALs and their delivery systems, the special
    aircraft that SOCOM, Air Force Special Operations Command
    brings to the battle, the special requirements for gunships,
    the type of terrain that our MC-130 Talons and other aircraft
    might be required to negotiate. Certainly weather is a factor;
    relationship to other U.S. forces, the ability to integrate
    with marines, etcetera; how those locations might support a
    rotational concept that General Brown may want to look at in
    terms of repositioning his forces in the future.
        I think all those are extremely important issues. I had the
    opportunity, sir, about a month ago, General Brown and I both,
    to talk extensively to Admiral Fargo in the Pacific and with
    his theater SOCOM commander, Air Force Brigadier General Greg
    Trebone, about the unique requirements that we are facing in
    the South Pacific. As, sir, you are well aware of, perhaps new
    alliances or locations that we have not looked at before, such
    as Australia, could benefit us.
        There are ungoverned territories that we are very concerned
    about, where we know that terrorists will breed and retreat to.
    To the extent that the U.S. SOF can play an important role in
    assisting governments in bringing their territory under control
    and helping us monitor what is going on there, those locations
    will become more and more important.
        If that is satisfactory, sir, I would like to switch to
    General Brown.
        Chairman Warner. General Brown.
        General Brown. Sir, I think you hit the nail on the head.
    For us it is about being responsive. Our forces just by their
    very nature are agile, flexible, and very responsive small
    forces capable of moving very quickly. It is about where we are
    positioned around the world so that we can have maximum ability
    to respond, to influence an area where we want to influence it
    through our coalition relations. We do coalition training very
    well. Of course, there is also a quality of life piece for our
    soldiers, sailors, and airmen.
        We are working with the geographic commanders to see what
    their plans look like and where they think that we should be
    moving. Quite frankly, they are very supportive of their SOF in
    their AORs to accommodate where we think we ought to be so that
    we can be at the right place at the right time.
        Part of this will be done through a rotational basis, as
    Secretary O'Connell mentioned, but additionally through our
    exercise program, which is a pretty robust exercise program to
    get small groups of SOF, both civil affairs, psychological
    operations (PSYOPs), but mostly our Green Berets and our SEALs,
    out on the ground with our coalition partners to keep a
    presence in an AOR or a region just through training with our
    coalition allies.
        Chairman Warner. Formerly you were more or less in a
    supporting role to the forward-deployed commanders. When they
    needed the special expertise, they sent for it. But now you
    have the authority from the Secretary of Defense of a fully
    operational combatant command. In other words, you can sit down
    and plan an operation yourself.
        General Brown. Yes, sir.
        Chairman Warner. Within your ranks you can establish the
    forces to carry out that plan. So that is a very major and new
    large dimension to your responsibility.
        General Brown. Sir, I think you are exactly right. I think
    there are two pieces to that. One is that as part of this
    authority, where we were totally responsive in the past to what
    the geographic combatant commanders would want us to do in
    their AORs or their theater security cooperation plan, today
    those requests come to us and we prioritize where we need to go
    so that we are in the right locations around the world. That is
    a nuance, but it is a very important nuance in that now we are
    in charge of where we are deploying, as opposed to just
    responding. Quite frankly, we still are responsive to the
    combatant commanders if they have specific instances. But we do
    have the authority to be in charge of where we put our SOF.
        So that is one piece of it. The other piece is that as
    SOCOM we do not own bases and we do not own infrastructure. We
    simply own forces. So wherever we want to position our forces,
    we will work with the geographic combatant commanders to build
    the infrastructure there to support our forces.
        Chairman Warner. But I am wondering if while they do the
    drawdown in these forward-deployed areas, does that require you
    to have a larger force structure within your command? Now, I
    know that is a sensitive subject. You do not want to get out
    ahead of the Secretary of Defense, but I think it is an issue
    that Congress is going to have to focus on.
        General Brown. Yes, sir, I think you are right. We need to
    watch that very carefully.
        Chairman Warner. Thank you.
        Now, with regard to your Department and your
    responsibility, you are largely dependent on intelligence and
    real-time intelligence. People immediately think of the CIA,
    but it is not the primary agency here. It is really the Federal
    Bureau of Investigations (FBI), I presume, that you have to
    rely on for the domestic side of the intelligence picture.
    Share with the committee how you operate both with the CIA and
    the FBI in getting that real-time intelligence that enables you
    to carry out your responsibilities.
        Why do you not start off, Mr. Secretary?
        Secretary McHale. Senator Warner, I anticipate that General
    Eberhart will speak in some detail about the close daily
    cooperation that he has in his combatant command with the
    intelligence services that you have just made reference to. But
    from a civilian perspective, it is essential that we see
    intelligence as a whole and that we not distinguish, other than
    in those areas where the law requires it, between essential
    information that might be drawn from overseas sources versus
    those that might be collected in a lawful manner domestically.
        TTIC was really intended to address that kind of fusion of
    all-source collection, and in my experience, and it has been
    daily for the past year, that process has improved remarkably.
    Each morning I begin with a Defense Intelligence Agency (DIA)
    briefing, a JTF Counterterrorism briefing, where the backbone
    of that briefing is drawn from the TTIC matrix. That matrix
    reflects sources that are domestic international. It reflects
    both civilian and military collection capabilities.
        We have brought together into a single source of reference
    all of the collection capabilities that are available to our
    government worldwide. We synthesize that information. We
    present it in a comprehensive and readily digestible way each
    day. So senior policymakers have available to them a single
    source overview of the threat environment.
        That initial briefing guides what I do for the rest of the
    day. In a crisis environment, in my experience--and we have
    gone through a half dozen such periods in the past year--TTIC
    steps to the forefront. John Brennan, who runs TTIC, assumes a
    lead responsibility, along with George Tenet, in providing a
    briefing to very senior policymakers, typically at the Cabinet
    level, so that they have a common picture of the threat
    environment.
        So over the last year I have, on many occasions, become
    aware of domestic vulnerabilities from sources that on some
    occasions are international, on some occasions are domestic, in
    some cases are military, and in other cases civilian in
    character. The important lesson learned since September 11 is
    that we need to bring all of that together into a common
    operating picture, and that is TTIC's mission.
        Chairman Warner. Thank you.
        General.
        General Eberhart. Sir, such is the same case at NORTHCOM.
    Every morning our Intelligence Community is on a video
    teleconference with TTIC, the Joint Terrorism Task Force
    (JTTF), and the FBI folks. They make sure they have all the
    relevant information that might affect our area of operations
    (AO).
        So when you receive the briefing shortly thereafter, it is
    a compilation of all these various sources from DIA, from TTIC,
    from the JTTF, from all these different organizations, from
    CIA, FBI, and military intelligence around the world.
        Our command is just a little bit different, as Secretary
    McHale has suggested, in that we are interested in what is
    going on around the world that might affect our homeland
    security. So in fact, we ask questions. When we receive this
    information, we ask ourselves some very basic questions. The
    first question is, what else do we need to know about this
    incident, this information? Who else needs to know this? That
    is very important to us, because when I receive this briefing
    there will be a senior FBI representative in the room who is on
    our staff. There is a senior CIA representative on our staff.
    The National Security Agency (NSA) is involved as well, and the
    alphabet soup goes on and on, with all of the relevant players.
        So we make sure in that forum that everybody who needs to
    know this information knows. In fact, then we cross back and
    forth between law enforcement, homeland defense, and homeland
    security, which I think is very important and markedly
    different than before September 11, markedly different before
    NORTHCOM and the Assistant Secretary for Homeland Defense.
        Chairman Warner. Thank you. That is a very reassuring
    report.
        Senator Ben Nelson.
        Senator Ben Nelson. Thank you, Mr. Chairman.
        I thank you all for your service and what you are doing to
    make our national security and homeland security stronger for
    the American people.
        General Eberhart and Secretary McHale, retired Air Force
    Major General Larry Arnold was in command of all the NORAD
    fighters on September 11 and was quoted not that long ago as
    saying, ``We had so few airplanes on alert anywhere, if we got
    a resource airborne and it went in the wrong direction we did
    not have anything else to back it up.''
        Now, I understand that a lot has been done to improve the
    capability that we might have to intercept, interdict those
    unusual situations, 1,700 of them as you have indicated. Have
    you implemented any new policies with regard to firing on
    commercial aircraft during terrorist attacks, and do you
    believe that you have adequate assets now to do the job that
    might be required in that event?
        Perhaps we should start with you, Secretary McHale, then
    General Eberhart.
        Secretary McHale. Senator, if I may I will address the
    policy issue. The operational question, as to the adequacy of
    assets, I will defer to General Eberhart if I may.
        Senator Ben Nelson. That will be fine.
        Secretary McHale. Policy was made on September 11 because
    of immediate events. We were faced on that day, the Vice
    President in particular as I understand it was faced that day,
    with an unprecedented challenge. It is my understanding that
    the Vice President provided guidance as to how to respond to
    emerging threats that might involve additional commercial
    aircraft used as weapons platforms.
        In the wake of September 11, we in the DOD initiated a
    thorough review of all the policy and legal considerations
    related to the sobering yet foreseeable responsibility to shoot
    down a civilian aircraft. As a result, we have developed very
    detailed procedures, many of which would be inappropriate to
    discuss in this setting----
        Senator Ben Nelson. I think that is fine.
        Secretary McHale.--very detailed procedures regarding the
    level of our response, how we escalate from one level to the
    next, the way in which we confer in a secure telephone call to
    consider and ultimately implement any decisions that might be
    necessary.
        Senator Ben Nelson. Can that be done in a very timely
    manner?
        Secretary McHale. It can. Also, in the event that the
    senior person delegated with authority to make that decision is
    unavailable, we have, again in very detailed procedures,
    delegated that authority down to subordinate levels, but
    keeping that authority at senior general officer rank. It
    begins with an initial decision by an available civilian, but
    if that civilian is not available, if General Eberhart
    thereafter is not available, we have look-to contingency plans,
    nonetheless keeping that authority, as you might expect, at a
    very high level.
        Finally, we routinely train to that requirement. We conduct
    exercises on a periodic and frequent basis where that decision
    is faced and made in a training environment so that we are not
    exploring these very difficult choices in the middle of a real
    world crisis.
        Senator Ben Nelson. Which we may have been doing at the
    time of September 11, perhaps.
        Secretary McHale. We have certainly moved into a new
    chapter of detailed training, planning, and procedures so that
    the rules of engagement and the decisionmaking process now is
    quite clear.
        Senator Ben Nelson. General Eberhart?
        General Eberhart. Sir, first of all, as we look at the
    force structure we have today, we have manyfold the number of
    fighters on alert today as opposed to the morning of September
    11.
        Senator Ben Nelson. I understand that of those fighters
    that were available for interception, the closest were at Cape
    Cod.
        General Eberhart. That is correct, sir.
        Second, we have placed these fighters in different
    locations to ensure that, as we have done our analysis, we can
    respond to our major population centers and key
    infrastructure--nuclear power plants, chemical facilities, et
    cetera.
        Then there is an analysis at different force levels that,
    based on the threat we see, we can vary all the way from force
    level 5 to force level 1, where we again increase the number of
    fighters on alert based on the risk or threat we perceive.
        Senator Ben Nelson. In the case of multiple attacks, we are
    also capable of responding to multiple locations?
        General Eberhart. Exactly, sir.
        Then, second, we do fly regular air patrols, as Secretary
    McHale said in his opening statement. So we often have aircraft
    airborne that are readily available to respond, and I would say
    serve as a deterrent to those who might want to use an aircraft
    the way they used it on September 11.
        We do have clear responsibility and authority in terms of
    where these rules of engagement, this responsibility, and this
    authority are vested. Not only is it clearly stated on paper,
    we exercise this at the tactical level all the way to the
    strategic level from daily to weekly to monthly in these air
    defense exercises that Secretary McHale mentioned in his
    statement.
        Senator Ben Nelson. For those of us in the civilian world,
    would that be like fire drills?
        General Eberhart. It would be like fire drills, yes, sir,
    but we do not fire. It is very important.
        Finally, I think it is very important to note that I
    believe this does serve as a deterrence and that we have no
    other option. We must have these aircraft on alert. We must fly
    these irregular air patrols. But it is not the right way to
    work this problem, because if we have to use an aircraft that
    way, to shoot down another aircraft, the tragic thing is
    everyone on board will die.
        So the right way to work this problem again is to capture
    and kill terrorists in Afghanistan and Iraq and wherever we
    find them; second, to make sure that we have the right security
    at our airports and onboard our aircraft so terrorists cannot
    take over an aircraft again. That is the right way to work this
    problem.
        Senator Ben Nelson. Have we not resolved a great deal of
    that in terms of turning an aircraft into a flying missile by
    securing the cockpit door so that it does not open under any
    set of circumstances, therefore not enabling the terrorists to
    use the plane in that capacity?
        General Eberhart. Sir, I think that is a very important
    step and one that we have done. But, obviously there are people
    out there right now trying to figure out how to breach that
    door we say cannot be breached.
        Senator Ben Nelson. I understand.
        My time has expired. I would like to know--perhaps we can
    follow up with a letter to find out--if there is any
    coordination between what we do domestically, let us say with
    the North Atlantic Treaty Organization (NATO), because of the
    number of incidents recently where commercial aircraft have
    been grounded and asked not to fly into the U.S. Is there any
    coordination with NATO because of international travel?
        General Eberhart. Sir, there is. There is at the diplomatic
    level, at the Federal level from FAA to their counterparts, and
    then finally at the military level, military to military. That
    coordination exists.
        Senator Ben Nelson. So we are aware of what is happening
    there when it is happening, in real time?
        Secretary McHale. Senator, there is no question about that.
    We had a real world experience in that regard, over the holiday
    threat season, and I can tell you that we conducted conference
    calls every 6 hours during that period of time throughout the
    entire holiday season. We had direct input from our European
    allies through diplomatic channels during each and every one of
    those calls.
        So in a crisis environment, when we believe that there is
    an emerging threat coming, let us say, from Western Europe, the
    coordination is constant. Once the lines of communication are
    opened, they remain open throughout the entire crisis period
    until it is determined that the threat has passed.
        Senator Ben Nelson. Thank you, gentlemen.
        Thank you, Mr. Chairman.
        Chairman Warner. Senator Inhofe.
        Senator Inhofe. Thank you, Mr. Chairman.
        A couple days before the chairman and Senator Stevens were
    in Iraq and in Afghanistan, Senator Akaka and Senator Allard
    and I were there. I want to say to you, General Brown, I took a
    particular interest and have for some time in getting into this
    Future Combat System (FCS), and I recall going to Fort Lewis,
    Washington, when the big debate on whether to continue with the
    M-113 or get into this thing which has evolved into the Stryker
    Brigade. At that time it was a Canadian vessel. I came back and
    said: We do not need competition. I just had the competition
    and it is over.
        Up in Mosul, being able to see the first of the Stryker
    brigades on the ground, I cannot tell you how revolutionary I
    believe that is and what a great benefit that is going to be to
    our guys on the ground. I just commend everyone who has had a
    participation in that.
        When I was serving with Secretary McHale in the other
    body--I came over here 10 years ago; that was 1994--I was on
    the Intelligence Committee, and one of my rude awakenings was
    when I would go to the NSA, the FBI, CIA, DIA, and all the rest
    of them, to find that this was one huge turf battle, and I
    could not believe what I was observing at that time.
        I know that Senator Warner has pursued this, but I want to
    carry it one last step. You have all these agencies. You have
    all of your unified commands. They have their intelligence-
    gathering systems. Are you totally satisfied--and I would ask
    the question to Secretary McHale as well as General Eberhart--
    that you are getting everything you need in terms of using all
    the resources? Are the turf battles over, and is that problem
    now resolved?
        Secretary McHale. I think the institutional competition,
    the culture that you described, Senator, has now passed. I
    think we are all sobered by the magnitude of the tragedy on
    September 11 and that prompted a lot of folks to grow up real
    quickly and break down those stovepipes, particularly the
    intelligence stovepipes, between institutions that previously
    had seen themselves in competition rather than cooperation.
        When I came before this body on my confirmation hearing, I
    said that if you catch me using the word ``satisfied'' you can
    ask for my resignation. I am not satisfied, and I can think of
    a number of areas, particularly in the maritime domain, where
    we need to make progress in making maximum use of existing
    surveillance capabilities as well as those that are under
    current R&D.
        But in terms of the culture that prevented the sharing of
    information----
        Senator Inhofe. I am talking about the culture, not the
    technology.
        Secretary McHale. I can tell you, sir, that I have been
    involved in most of the senior-level deliberations during real
    world crisis periods during the past year and I have sensed no
    remnant of that culture. The challenges are operational and
    technical. They are not institutional in terms of a false
    perception of agency competition.
        Senator Inhofe. General Eberhart, you would generally agree
    with what the Secretary said?
        General Eberhart. Yes, sir.
        Senator Inhofe. One of the other things we did when we went
    over there was go to Bilad Air Base and watch the Predators. I
    have been very interested over the years in the capabilities
    that we have, not just with the Predators, but also the U-2 and
    so forth. We now have this new airship, the High Altitude
    Airship, that apparently has some great capabilities. General
    Eberhart, I would like to ask you, when you look at the manned
    aircraft and the UAVs and the U-2 and then this new one, are we
    getting to the point now where you are satisfied that we are
    able to get the coverage that we need and gather the
    information that we need, insofar as doing it from up above?
        General Eberhart. Sir, I am not yet satisfied. Obviously,
    we are headed in the right direction because of the types of
    equipment that you just referenced. Between the Predator and
    the Global Hawk and other tactical UAVs, we have a capability
    and a capacity today that we did not have 5 or 10 years ago.
    But it still does not represent in my view the capability and
    capacity we need to have, the maritime domain awareness that
    Secretary McHale just referenced, to be able to use these types
    of platforms--which are still in my view high demand, low
    density platforms--to aid in homeland security when other
    Federal agencies might need or want them.
        So I believe this will continue to be a combination of
    space assets and air-breathing assets, both manned and
    unmanned. This High Altitude Airship demonstration that you
    reference, which actually will not be demonstrated until 2006,
    holds great promise. We need to stay the course, and if that in
    fact pans out then we need those to help secure the borders of
    this great Nation.
        Senator Inhofe. If that pans out. Now, I understand that
    they have a radius of 700 or so miles that they would be able
    to cover. My question would be, if this is something you would
    be using, how many of these vehicles would it take to cover
    North America and what is in there right now to get us to that
    point?
        General Eberhart. Sir, we can provide you that analysis.
    Obviously, the only thing that is in the budget right now is
    the concept demonstration to see if in fact it is worthy to
    invest in, and we will not know that until 2006.
        I would not advocate putting these all around North
    America. I would advocate using these on the threat axes that
    we anticipate being used by terrorists and others. So we can
    provide you the analysis that we have done along these lines,
    but I think it would be premature to invest in that High
    Altitude Airship until we see the concept demonstration.
        [The information referred to follows:]

        Analysis from the 2000 National Cruise Missile Defense Study
    indicated it would require 10 airships on station, with appropriate
    sensors, to cover the perimeter of the continental United States.
        The advanced concept technology demonstration budget for fiscal
    year 2005 is $29 million. The Missile Defense Agency provides $22
    million; $4 million comes from the Deputy Under Secretary of Defense
    for Advanced Systems and Concepts, with the remaining $3 million coming
    from the United States Army as the lead service.

        Senator Inhofe. General, my time has expired, but I am
    interested in the exercise 2004--what was that called, your
    exercise?
        General Eberhart. Yes, sir. Most recently we did the
    Determined Promise 2003, and then we just completed another
    exercise here in February.
        Senator Inhofe. Then how many to go?
        General Eberhart. Sir, we do two major exercises a year.
    What is really very promising about this is now we have linked
    these exercises into a national exercise program, including DHS
    and other Federal departments.
        Senator Inhofe. Including reaching first responders?
        General Eberhart. Sir, right down to first responders. In
    fact, the one that we will do, Determined Promise 2004, this
    August will take place--one of the States will be Virginia, and
    we will have a series of exercises there in the Chesapeake
    region and in Richmond.
        I believe that when you talk to the States who have
    participated in the past, most recently Alaska and Texas, they
    sing the merits of these types of exercises.
        Senator Inhofe. Thank you, General.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator Inhofe.
        Senator Levin.
        Senator Levin. Thank you, Mr. Chairman.
        General Eberhart, we talked a bit about this in the office,
    but I would be interested in your expanding on it publicly. You
    just reached your full operating capability last October and
    you have been referred to as an evolving command. Can you tell
    us what percentage of your staff is Reserve or civilian, and do
    these percentages present you with any problems? Do you expect
    those percentages to level off or to grow?
        General Eberhart. Sir, right now we are slightly different
    than the other unified commands, because obviously we are in
    the continental United States and our AOR is here in North
    America. So our target is 60 percent military, 40 percent
    civilian, which is a high civilian contribution to a command of
    this sort.
        When you look inside the military, I do not have the
    numbers and I will have to provide those for the record, but we
    have a higher percentage of National Guard, Army and Air, and a
    higher percentage of Reserves from all of the Services, than
    other commands. The homeland defense, homeland security mission
    lends itself to that type of civilian-soldier, civilian-airman
    participation and contribution.
        We are committed to leveraging their talents. If you look
    at our general officer and our senior leadership in terms of
    Guard and Reserve, we have, as we discussed yesterday, several
    Guard and Reserve full colonels, captain reservists and
    guardsmen. I think this, in fact, is the right way to go for
    our command, and we will continue to have more reservists and
    more guardsmen in our command.
        [The information referred to follows:]

        Seven percent of our staff is from the Reserve component; 31
    percent is civilian. In the future, we anticipate the Guard and Reserve
    presence will hold steady, and our civilian workforce will increase to
    approximately 40 percent. We are creating a balanced, total force team
    of active duty service members, reservists, guardsmen, civilians, and
    contractors capable of addressing all aspects of our missing, and
    foresee no issues at this time.

        Senator Levin. I know you have testified this morning about
    the relationship between the TTIC and CTC on the intelligence-
    sharing issue, but I want to press that a bit further.
    Secretary McHale, perhaps you can address this issue. I
    understand that there are joint briefings and that there are
    people from all of the various components that are collocated
    at the intelligence analysis facilities. But what I am
    interested in--and again, Senator Collins as the chair of
    Governmental Affairs is equally interested in--is the question
    of where is the final responsibility for analyzing the foreign
    intelligence and domestic information relative to foreign
    terrorism in North America?
        Is it TTIC? Is it CTC? Who has that final responsibility to
    say, that is a major threat over there, and someone else is
    saying, well, I am not so sure about it. We get a massive
    amount of information, and I know we have these joint briefings
    and a lot of jointness in here. But you have to focus
    responsibility for making the ultimate call that then will go
    up to a decisionmaker. Is that CTC or is that TTIC?
        Secretary McHale. I believe it is TTIC. I can tell you,
    Senator, that based on my experience, in terms of the
    consumption of available intelligence, that is not a hard call.
    My contact with TTIC is daily. The contact my office has with
    TTIC in a crisis environment is almost continuous.
        When my office was created in the National Defense
    Authorization Act, that same legislation also created the
    position of the Under Secretary of Defense for Intelligence
    (USDI), and Dr. Cambone and I have discussed this issue in some
    detail and I have readily supported the lead of USDI in terms
    of the institutional relationship between DOD and TTIC.
        But we in the office of the ASD-HD are avid consumers of
    intelligence in both a peacetime and crisis environment.
        Senator Levin. Are you represented at the CTC?
        Secretary McHale. My office is not.
        Senator Levin. Where are the DOD representatives over
    there? Who is representing the DOD over at CTC? Is it DIA?
        Secretary McHale. DIA, subject to the supervision of the
    USDI. But by conscious choice the role that we play in ASD-HD
    is as a consumer of the information they collect, and USDI
    takes the lead in terms of the institutional relationships. As
    a practical matter, when there is a crisis I usually attend the
    senior level briefings provided by John Brennan. Clearly TTIC,
    working closely with the FBI and CIA, takes the overarching
    lead for the fusion of all intel sources overseas and domestic.
        Senator Levin. I am not talking about a crisis. I am
    talking about analysis to prevent a crisis. If you think TTIC
    is the place where the final responsibility lies, that is fine
    with me. I do not have any particular opinion as to where it
    ought to lie, providing it lies somewhere that is clear. If you
    could just do this for the record. If you could get us anything
    in writing which clarifies that ultimate responsibility, you
    will go a long way, I hope, in addressing the concern that many
    people have had about any confusion or overlap in this area.
        [The information referred to follows:]

        TTIC has the primary responsibility in the U.S. Government for
    terrorism analysis (except information relating solely to purely
    domestic terrorism) and is responsible for the day-to-day terrorism
    analysis provided to the President and other senior policymakers. It is
    presumed that all terrorism information has a link to international
    terrorism unless determined otherwise. When information has been
    determined to have no such link to international terrorism, the FBI has
    primary responsibility with regard to the analysis of such information.
    This FBI responsibility, like TTIC's, is independent of where the
    information was collected.

        Secretary McHale. Yes, sir.
        Senator Levin. We cannot afford to have any cracks or
    uncertainty here between the intelligence analysis folks.
        Secretary McHale. Senator, I will go back to Dr. Cambone
    and I will ask him for his guidance and assistance in the
    preparation of the answer to that question. But I can tell you
    as a practical matter, each and every day in a peacetime
    environment as well as a crisis environment the interface that
    we have with the Intelligence Community is through TTIC.
        Senator Levin. There are currently 32 operational WMD-CSTs.
    I believe that our last authorization bill directed the
    establishment of an additional 12 teams and the DOD has
    included funding for 5 of the 12. I am just wondering why all
    of the additional 12 were not put into the budget request this
    year.
        Secretary McHale. Senator, your numbers are very nearly
    accurate, but I would note a slight discrepancy, if I may.
        Senator Levin. Sure.
        Secretary McHale. In I think it was the National Defense
    Authorization Act of Fiscal Year 2003, though I am not 100
    percent certain in my reference, by statute Congress authorized
    and directed the DOD to create 55 CSTs, so that there would be
    a CST in each and every State. California has 2 CSTs, so we are
    talking about basically 54 different jurisdictions with 55
    CSTs.
        As I noted in my opening statement, we have already
    created, certified, trained, and funded 32 CSTs. So we have a
    remaining and outstanding obligation to go from 32 up to 55. In
    the most recent appropriations bill, funding was provided, and
    I believe it was $88 million, for 12 more. So we are going from
    32 up to 44.
        There are 11 remaining CSTs and in the President's budget
    we decided that in the next fiscal year 4 of the remaining 11
    would be funded, 4 in the year after that, and 3 in the final
    year. We believe that this can be done without degrading in any
    way the operational capabilities or the protection provided to
    citizens in those States and territories. A significant number
    of the remaining 11 consist of territories.
        We obviously will follow the law. Congress directed the
    creation of 55. Congress this year funded 12 more. We will
    create 12 more. My advocacy is in support of the President's
    budget submission and we will obey the law as you pass it.
        Senator Levin. Thank you.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you.
        Senator Collins.
        Senator Collins. Secretary McHale, I want to follow up on
    Senator Levin's questions to you about the TTIC. Last year the
    Governmental Affairs Committee held 3 days of hearings on how
    the new center would work. In addition, Senator Levin and I
    followed up with two letters last fall, both of which remain to
    be answered in a satisfactory manner, to ask the question of
    who is ultimately responsible for the analysis of information
    affecting our country, and were the lines of authority clear.
        I am told that the reason we have not received an answer to
    our letters is that the DHS, DOD, and CIA cannot agree on an
    answer, which implies to me that the lines of authority are not
    clear and that the answer is still being devised. I am
    heartened today to hear you say that the new center has worked
    very well, and that you are playing a very active role. But do
    you believe that if we had the DHS and the CIA sitting here
    this morning they too would agree with you that the TTIC, not
    the CTC, is the lead entity?
        Secretary McHale. Senator, my answer earlier was really one
    as a consumer of intelligence. Frankly, I am not qualified as I
    sit here, and it is probably not appropriate for me in the
    billet that I hold, to make a judgment of legal responsibility
    and an analysis on that policy plate.
        However, from an operational standpoint and the
    dissemination of critically important information in an
    effective and timely manner during both peacetime and most
    especially in a crisis environment, my experience over the last
    year has been that John Brennan from TTIC has been the single
    source of fused information drawn from all sources, civilian
    and military, domestic and international. The information that
    I receive, which guides our activity, most especially in a
    crisis environment, has come to us through TTIC, and often that
    information includes information that has been provided to TTIC
    by both the FBI and the CIA.
        I have a fairly limited--important, but limited--viewpoint,
    and that is as an avid consumer of this information. Although
    the meetings that I attend often involve a senior briefing from
    the CIA, the briefing that follows that, which pulls it all
    together, is the TTIC briefing.
        So I am not prepared to make a legal judgment, but I can
    tell you from operational experience at the policy level John
    Brennan and TTIC have been the highest level of integrated
    intelligence to which I have been exposed.
        Senator Collins. General Eberhart, the Chief of Naval
    Operations (CNO) has spoken of the need for a maritime NORAD.
    This concept would allow the monitoring and tracking of cargo
    and passenger vessels in and around North America. I understand
    that you are also an advocate for that approach. Could you tell
    me if this remains in the theoretical stage or if you are
    already building a maritime NORAD based on existing military
    and law enforcement infrastructure?
        My concern is that I believe we have not paid enough
    attention to port security. There are a lot of interesting and
    worthwhile initiatives under way, but it strikes me as one of
    our greatest vulnerabilities. When you think that in our
    country we have some 6 million containers coming into our
    seaports every year, each of which could contain terrorists,
    the makings of a dirty bomb, or other dangerous weapons, we
    really need to have a better system for protecting our
    coastlines and our seaports.
        What is the status of the maritime NORAD?
        General Eberhart. Senator, I am in agreement with and a
    proponent of, at least figuratively, a maritime NORAD.
    Obviously, whether it is under a NORAD-type arrangement with
    Canada is one of the things that we are actively looking at
    right now with our bi-national planning group, with
    representatives from Canada and the United States, to see if we
    should change the complexion, the terms of reference, of NORAD
    as we know it today from air and space to include maritime, to
    include land, to include civil support.
        So that has been actively ongoing for about 6 months, and
    they will report out in the late summer, early fall in terms of
    their findings. Those will then be factored into the next NORAD
    agreement, which will be struck in the year 2006.
        Meanwhile, we are not just waiting for that study. We are
    taking active steps, steps that have been supported and
    promoted by the Congress of the United States in terms of the
    Transportation Act and other such pieces of legislation that
    allow us to make sure that people give us 96 hours notice,
    those kinds of things which are very important. Now, we do not
    expect a terrorist to give us 96 hours notice, but it helps us
    sort through the traffic that is coming to our ports.
        The Coast Guard enforces this. If you do not give them 96
    hours notice, you will wait out there or maybe you are in fact
    boarded to be checked out.
        I think we have made great progress since September 11 in
    terms of maritime security. But once again, we have a long way
    to go, and I think one of the approaches could be, again
    figuratively, a maritime NORAD, where people out there are
    transponding their position and identification, and that we
    have better security at the ports of embarkation so we know
    what in fact went on that ship as it left the port, the foreign
    port, where it stopped en route.
        So I am a big proponent of a maritime NORAD, coupled with
    what the Coast Guard is doing, as you are well aware, with the
    maritime domain awareness, which we think holds great promise.
    We are working this very hard. We have a long way to go, but I
    think it is important to note for the American people that we
    have come a long way since September 11.
        Senator Collins. Thank you.
        General Brown, I would like you to address an article that
    I read in a recent issue of Stars and Stripes, which talked
    about a potential exodus of highly experienced special
    operators to go to private security firms which can pay higher
    salaries and give greater benefits. It also quotes Secretary
    O'Connell as saying that the CIA and some of our other
    intelligence agencies are offering compensation packages and
    that there is some intergovernmental poaching going on that can
    be a significant problem for the military.
        Could you address what is being done to retain those
    special operators?
        General Brown. Yes, ma'am, I will be glad to. The retention
    of our SOF is a big issue. As a matter of fact, we had a
    meeting up here yesterday with all my component commanders to
    discuss exactly that issue. One of the problems that you
    brought up specifically is that in this new security
    environment we are in, the kind of people that we are training
    today in special operations are culturally aware, able to work
    overseas, experts with handguns and long rifles, physically
    fit, hand-selected guys that also speak a foreign language--
    every Green Beret cannot graduate from school until he can
    speak a foreign language. These kind of people are very
    attractive to those kind of civilian private industries that
    provide security services, both at home and abroad.
        So it is a very lucrative opportunity right now for special
    operations folks to get out and take very high-paying jobs.
    Those that are at the 20-year point--and a good example of this
    is the one Mr. O'Connell mentioned--is that an E-9 at 20 years
    of service today will retire with about a $23,000 retirement
    pay per year. He can go out and immediately make five times
    that much with a security firm and keep his retirement.
        For us in special operations, oftentimes we do not get our
    people until they are a little more mature, because we
    traditionally, specifically in the Green Beret skill set, do
    not recruit them until they have already been in the service
    for a certain period of time. We are getting them later in
    their military career, and then we put them through this
    training, which lasts up to 18 months.
        So by the time we actually get this operator out in the
    field he has been in the Army for quite a while. So we are only
    going to get this 12 years of time to use him after very
    expensive training, unless we can keep him after the 20-year
    point. So while other skill sets can retire at 20, we really
    need to keep our guys after that if we can because of their
    skills.
        Real quickly, what we have done is during the first week of
    December at SOCOM headquarters in Tampa, I brought in about 20
    families. I brought the wife and the husband in. We conducted a
    workshop for about a week to come up with any possible
    initiatives that we can to get people past the 20-year hump and
    make them more readily available to stay in for a lot longer
    period of time.
        They came up with a lot of initiatives. We are culling
    through those right now. We have a tiger team. They made their
    first out-brief yesterday morning to my commanders and we are
    working through those issues.
        Senator Collins. Thank you.
        Chairman Warner. Thank you, Senator Collins.
        Senator Reed, would you indulge the chair for just one
    observation? Senator Collins, your comment about the maritime
    NORAD is one that interests me. I was not clear as I listened
    very intently to the replies of our witnesses.
        The concept is now being worked in your organization, am I
    not correct?
        General Eberhart. That is correct, sir.
        Chairman Warner. We are not going to go out and set up
    something separate from you just as it relates to the seas,
    correct? It is going to be expanded within your existing
    structure and kept there?
        General Eberhart. Exactly, yes, sir.
        Chairman Warner. Is that the Senator's understanding?
        Senator Collins. Yes.
        Secretary McHale. If I might briefly address that, the
    Secretary of Defense has directed that we in our office prepare
    a comprehensive homeland defense strategy by June 2004. General
    Eberhart has responsibility in a number of domains, the most
    obvious being the air domain with NORAD. In the land domain,
    where the mission is constrained by virtue of land missions
    within the United States, we normally play a supporting role
    for a lead Federal civilian agency.
        But the maritime domain in my judgment is comparable to,
    quite similar to, the defensive responsibilities that are
    traditional in the air domain. As we expand those capabilities
    and push out the maritime defense, that responsibility will be
    integrated under the affected combatant commander. It will be
    General Eberhart's responsibility, and that of his successors.
        Chairman Warner. Understood.
        I thank the Senator from Rhode Island.
        Senator Reed. Thank you, Mr. Chairman.
        General Brown and Secretary O'Connell, I understand that
    SOCOM is now authorized to operate in areas which were
    previously exclusively reserved for CIA. Their operations were
    governed by certain legal requirements for notifications to
    Congress, findings by the President. Does SOCOM operate under
    those same rules?
        General Brown. Sir, we do not have any new authorities to
    operate in any areas that the CIA previously operated in. All
    the rules remain the same. I think the difference is that now,
    as the chairman mentioned earlier, we have the requirement to
    be able to operate as a supported commander as well as a
    supporting commander. But we have no unique authorities to
    operate in those specific areas such as the CIA would operate
    in.
        That process for military in support of the CIA still
    exists and we still have to go through all those same channels.
        Senator Reed. But there seems to be an impression that you
    have been given heightened responsibilities in the war on
    terror that are more than simply complementary. Is that just an
    erroneous public impression?
        General Brown. No, sir. We have been given some additional
    authorities, but they are not operating in the area that the
    CIA would traditionally operate in. We have been given more
    authorities. We have been given some more force structure. We
    have stood up a bunch of initiatives down at our headquarters
    to help us take on this global war on terror mission.
        Senator Reed. Thank you very much, General.
        Secretary O'Connell, you are responsible in your office for
    DOD counterdrug policy, also.
        Secretary O'Connell. Counternarcotics, yes, sir.
        Senator Reed. That is a growing problem in places like
    Colombia and Afghanistan. Afghanistan has sort of leaped to the
    top as one of the number one producers of heroin. I understand
    that the position of Deputy Assistant Secretary for
    Counternarcotics Policy is not filled yet.
        Secretary O'Connell. That is correct, sir.
        Senator Reed. Do you have any plans, Mr. Secretary, to fill
    that?
        Secretary O'Connell. Yes, sir. I screened I believe seven
    candidates and put the leading candidate forward. It is in the
    process of getting a yea or nay someplace, sir.
        Senator Reed. Good. But that is a priority with you and
    with the DOD?
        Secretary O'Connell. Absolutely, sir.
        Senator Reed. Thank you very much.
        Secretary McHale, you have already commented on the WMD-
    CSTs. Could you give a sense of the timing of what States will
    get their teams in some sort of order and the location of these
    teams within States? Is that location based upon population
    centers or mutual support to other teams, or is it simply kind
    of an ad hoc, first come first served, or other ways to
    allocate?
        Secretary McHale. It is the former, sir, and not the
    latter. When the first 32 CSTs were selected, and they were
    selected before I came on board, the dominant characteristic in
    the selection of those teams was population. Although that was
    not the universal characteristic, clearly those teams were
    chosen overwhelmingly because of the number of people who could
    be protected by the teams as they were proposed.
        When Congress directed us, as I described earlier, to
    create 55 CSTs, I began receiving questions from Members of
    Congress on both sides of the Capitol in terms of what the
    selection criteria would be, and I decided at that point that
    we needed to develop clearcut criteria to guide us in the
    process. I met with members of this committee individually to
    discuss that.
        Population remained extremely important, but in addition to
    population, for instance, I told Senator Nelson when I met with
    him, infrastructure would also be considered, particularly DOD
    infrastructure. You might have a rural State with extensive DOD
    infrastructure. We also look toward historic monuments,
    government centers, and other characteristics that could
    legitimately be brought into plan. I sent letters to many
    Members of Congress spelling out those criteria.
        Finally, the Defense Threat Reduction Agency (DTRA), one of
    our WMD capabilities, did a threat analysis with regard to
    various States, and DTRA came back with a recommendation. So I
    took the recommendations from DTRA and, with only one
    exception, applied those criteria in choosing the next 12. It
    is my intent, based on whatever level of funding is provided--
    and I advocate the President's proposal, but on whatever level
    of funding is provided--we will apply those same criteria in
    the selection of the next 11.
        Now, if they are all done at once it is not a choice. But
    if we phase them in as the President has proposed, we would
    have to choose four, four, and three, and I would once again
    use the same criteria.
        Senator Reed. As I understand it, the roles of these teams
    are simply to go on the ground and then to begin to diagnose
    the extent of the situation. But in terms of dealing with
    consequences, they do not have the resources or the strength to
    do that. Consequence management, not just diagnosis of the
    problem, is a key element.
        Secretary McHale. Yes, sir, that is correct. The CSTs have
    22 people, men and women, and they are drawn from the active
    duty, National Guard, Air and Army Guard, and they have an
    assessment capability. They are, as I said, on active duty.
    They can deploy quickly to a site where we believe there is a
    WMD contaminant. Properly protected with their individual gear,
    they go into the hot zone and, using remote sensor
    capabilities, they assess the nature of the contaminant so they
    can provide that information to follow-on forces.
        They also have a communications package, which is a very
    helpful tool to have at that stage in the process. But you are
    correct, Senator. They essentially perform reconnaissance. It
    is an assessment capability.
        But, recognizing that we need a high end capability,
    General Eberhart has trained and equipped JTF-CSTs and some
    other JTFs to provide a very robust response. What we have
    recognized is there is an unmet mission requirement between the
    22 people on a CST and the thousands of personnel associated
    with a JTF. We are trying to close that, not only with
    organizations such as the Marine Corps' Chemical-Biological
    Incident Response Force (CBIRF), but, as Lieutenant General
    Blum, the Chief of the Guard Bureau, has proposed, the creation
    of 12 CBIRF-like capabilities within the National Guard built
    around existing CSTs, so we could go from the small CST to a
    larger CBIRF-like capability and then ultimately a response
    from a JTF if the magnitude of the attack required that.
        Senator Reed. I would ask General Eberhart to comment on
    both the criteria and allocation of these teams from his
    perspective as the unified commander.
        General Eberhart. Sir, first of all, I am a big fan of the
    CSTs. They are diagnostic in nature, but in many cases that
    early read on what we have is very important so we know how to
    react.
        Second, as Secretary McHale said, their communication
    package is very valuable, so that everybody can talk to each
    other, so it translates, it provides the communication
    capability that did not otherwise exist.
        Finally, a spinoff here, and not universally the case, but
    usually the States that have a CST do a lot more exercising for
    these types of events, all the way from the local responders in
    many cases to the Federal representatives in that State.
        So I think that CSTs are something we need to continue to
    pursue. We need to over time upgrade their equipment and, as
    Secretary McHale said, I am a strong believer that at least in
    each Federal Emergency Management Agency (FEMA) region or each
    set of States we need an enhanced CST, more like the capability
    we have in the CBIRF.
        Now, how we allocate those teams is a very difficult issue.
    Obviously, we take into account population, key infrastructure,
    and then the issue of distance. Therefore in some cases,
    especially when you look at our territories out there, it takes
    us a long time to get that type of capability to a territory.
    So I believe over time we have the right site picture in having
    55 of these, 1 in each State and territory, 2 that already
    exist in the State of California.
        Senator Reed. Thank you very much, General.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much.
        Senator Allard.
        Senator Allard. Thank you, Mr. Chairman. I just want to
    congratulate you on this hearing because I think this is an
    important and very timely hearing. As I look at this panel, 20
    years ago we never had these positions, and certainly from my
    point of view all these positions have become extremely vital
    to our Nation's security.
        General Eberhart, I want to extend a special welcome to
    you. We are glad to have NORTHCOM in Colorado. My understanding
    is that you are requiring a lot of technical training to the
    civil authorities and that you have reached out to academia to
    help you provide some of this technical training. I wonder if
    you might make a comment or two about it, and not take up my
    full time in the process, and tell me a little bit about how
    that is going and the problems you might be encountering?
        General Eberhart. Our overall vision, our strategy here, is
    much like you and I experienced during the Cold War, when in
    academia and in think tanks and industry we had all these
    people who were dedicated to the strategic mission, clearly
    understood the strategic mission, and therefore we had this
    intellectual resource which we could draw upon.
        I believe that we need to do the same thing today in terms
    of homeland defense and homeland security. We need to plant
    those seeds out there, grow people who clearly understand
    homeland defense and homeland security, not just in uniform,
    not just in the government, but in our academic institutions,
    in our think tanks and industry. That is the way we will
    clearly win this global war on terrorism. That is the way we
    will win this home game.
        So as you have stated, we have a consortium of universities
    out there that have committed themselves, and these
    universities are all the way from State universities to private
    universities to professional military education institutions.
    They have all come together, and they have sponsored programs,
    degrees, and courses. They send us interns, we send them
    people.
        I think this is exactly the right way to proceed so we can
    truly have this capability in our Nation to win this war.
        Senator Allard. I thank you for your answer.
        I am in the process of drafting some legislation that would
    allow us to reach out to our closest allies on our national
    missile defense system and work with them with compatible
    systems. If you have any thoughts about that, I hope that you
    would share those with us in the process.
        So this brings to mind our relationship with Canada. My
    understanding is that you might be negotiating with them. They
    are one of the partners I would have in mind for drafting this
    legislation because they have always been such close allies of
    ours. How are your discussions going with Canada as far as
    whether they would be a partner or not in our missile defense
    efforts?
        General Eberhart. Sir, this is at best right now a policy
    issue, but it is proceeding. Obviously, we have exchanged
    notes. We have agreed to discuss the issue. There is no
    specific timetable for a decision here and no decision has yet
    been taken. I believe it is the right way to go, but obviously
    the leaders of the two nations have to make that decision.
        Senator Allard. Now, as the commander responsible for
    ground-based midcourse defense, can you perform this mission
    effectively without Canadian support?
        General Eberhart. Sir, my belief is that we can. We can do
    this mission without Canadian support. It will complicate the
    missile warning portion, but we can do it.
        Senator Allard. Many potential adversaries continue to
    develop increasingly more advanced cruise missiles. As we saw
    in the recent conflict in Iraq, cruise missiles were a problem.
    Do they create a serious threat and a problem here to the
    mainland in the northern continent, and if so, are there some
    things that you can share with us on that particular threat?
        General Eberhart. Sir, I am on record as being concerned
    about the proliferation of cruise missiles and the possibility
    of a cruise missile threat. We know that threat is a
    combination of capability and intent. We know that the
    capability is out there. What we have not yet seen is the
    intent.
        Obviously, we had the same situation prior to September 11.
    So we are very concerned, and the Secretary of Defense is also
    on record. That is one of the reasons that we have promoted
    this High Altitude Airship, so that we have this wide-area
    surveillance to detect the carrier of a cruise missile, whether
    it be a maritime carrier or an airborne carrier, because we
    have to detect it before we will be able to kill it, neutralize
    it.
        So we believe that we are proceeding apace with the High
    Altitude Airship, but we must have a way for wide-area
    surveillance because that is the only way we will be able to
    defeat the cruise missile threat to North America.
        Senator Allard. Now, in your prepared testimony you noted
    that elements of the current homeland air surveillance system
    are approaching or have exceeded their life expectancy and
    require modifications for continued operations. What is your
    strategy for either recapitalizing or upgrading these assets?
        General Eberhart. Sir, over the years, as their lifetime
    came to an end, the FAA decision was to go ahead and not
    replace these radars, because the belief was that airplanes
    they wanted to keep track of would be transponding and would be
    on a flight plan. So it was a conscious decision made in the
    1980s and the early 1990s.
        But after September 11, it became apparent that we needed
    this capability, that threats might emanate from within, and we
    had to have a better air picture than we would have otherwise
    had if we let these radars' lifetime just expire on us. So,
    with Congress' help, over the last 3 years we have added money
    each year to continue to fund these FAA radars, and my belief
    is that we need to continue to do that until such time as we
    have an alternate technology to provide this situational
    awareness, this air picture to us, so that we can protect the
    skies of North America.
        Senator Allard. Now, you plan on fielding a wide-area
    surveillance capability that can seamlessly connect all NORAD
    and NORTHCOM with the DOD and Canada. When do you plan to have
    that in place?
        General Eberhart. Sir, for all practical purposes we have
    that in place today. We have netted scores of radar that were
    not previously linked together. We see that in our NORAD
    command centers. We have established radio contact and put
    radios in all of the air traffic control centers out there, so
    we have good connectivity in terms of communications. We have
    liaison officers in the air traffic control centers and the FAA
    has liaison in our command centers.
        So, we have in fact netted that together today. Obviously,
    the challenge will be to keep that netted together as these
    radars age out.
        Senator Allard. Thank you, Mr. Chairman. My time has
    expired.
        Chairman Warner. Thank you, Senator.
        Senator Lieberman.
        Senator Lieberman. Thank you, Mr. Chairman.
        Thank you to all our witnesses for being here today. The
    chairman mentioned earlier the hearings that took place in this
    room over the last couple of days of the so-called 9/11
    Commission, and there was a lot of discussion about what was
    not done before September 11. I must say it is reassuring as I
    hear your testimony to see how much we have done, in your case
    through the DOD, obviously alongside the new DHS and a lot of
    other agencies, and I appreciate it.
        I am sure all of us would agree that we are not where we
    would like to be yet, but we are a lot further along than we
    were before September 11, and I think we all ought to take some
    satisfaction from that and we ought to express our gratitude to
    all of you for what you have done to make that happen.
        I did think in all the controversy and sound and fury of
    the last couple of days that one of the new pieces of
    information, at least at a harder level, was in the staff
    report by the commission yesterday. It stated that the FBI had
    identified two al Qaeda operatives associated with the attack
    on the U.S.S. Cole that were in the country, in our country, in
    August 2001, and apparently the White House and the
    Counterterrorism Security Group (CSG), which Mr. Clarke I guess
    headed, never knew about that.
        I take comfort in all the discussions that we have had--I
    take some confidence that that would not happen today, that
    there is enough interaction every day. I have been impatient
    about the coordination of the terrorism watch list, but there
    is enough going on that that would not happen. I worry, as my
    colleagues have, that there may be a proliferation of
    intelligence-gathering and fusion operations so that it may
    come to a point where there is not a clear sense of
    accountability.
        I note, General Eberhart, in your testimony that you have
    stood up a combined intelligence and fusion center in NORTHCOM.
    I would appeal to all of you to do what I am sure you will do
    anyway, which is to make sure that this profusion of such
    centers to fill the gaps that did not exist before do not
    become so diffuse that there is not a clear line of
    accountability when somebody is making decisions about what
    happens.
        But with that invocation and expression of appreciation,
    General Brown, I wanted to ask you a couple of questions. What
    is the number of active duty personnel that you have working
    under your command? In other words, how much SOF do we have?
        General Brown. Sir, today we have about 49,800 total
    soldiers, sailors, airmen, marines, and DOD civilians in SOCOM.
    Of that, about 14,900 are Reserve. So we have 49,000 on hand
    today, and about 14,000 of those are Reserve components.
        We will grow in 2005 to about 51,000 total people in SOCOM.
    About 14,000 will stay Reserve components.
        Senator Lieberman. Okay. So we are obviously calling on
    you. You are really are on the front lines in so many different
    ways.
        General Brown. Yes, sir.
        Senator Lieberman. If I caught your opening statement, you
    said that your forces in some sense were stressed, but that the
    OPTEMPO was manageable. The question really for us as the
    authorizers, knowing that everybody would always like more, is
    to urge you to be very direct with us in telling us if you are
    not getting the kind of personnel and support you need to carry
    out the missions that we all desperately and deeply want you to
    be able to carry out.
        General Brown. Yes, sir, I will.
        Chairman Warner. Could I make an observation?
        Senator Lieberman. Yes.
        Chairman Warner. You have raised a very important point.
        Of that 14,000 Reserves, how many are there by virtue of
    volunteering, as opposed to being called up?
        General Brown. We have 14,000 total assigned to our force.
        Chairman Warner. Yes.
        Well, maybe you can provide that answer for the record.
        General Brown. I really have to provide that for the
    record.
        [The information referred to follows:]

        SOCOM has approximately 14,900 authorized Reserve positions from
    all Services. All of those reservists have volunteered for Reserve
    assignment within SOCOM. Following the events of September 11, 2001,
    and in response to the presidential call up to active duty, many of our
    Reserve Forces were needed to support OEF, then OIF. In compliance with
    guidance of the Services, prior to mobilization, all of the
    subsequently-mobilized reservists signed a mobilization volunteer
    statement. Mobilization extensions for a second year also required
    those volunteers to sign a mobilization volunteer statement. As of
    March 2004, approximately 62 percent (9,238) of SOCOM Reserve Forces
    have been mobilized.

        Chairman Warner. I think a lot of them are persons who
    really want to be a part of your force and, even though they
    are in the Reserve Army, they are there because they really
    want to be there.
        General Brown. We have a great history of using our Reserve
    component.
        Senator Lieberman. Would I subtract them and say that you
    have about 35,000 on active duty?
        General Brown. Yes, sir.
        Senator Lieberman. That is a relatively small percentage of
    our overall active duty personnel, in an area where you are
    really being asked to do a lot. There are high demands on you.
    So I hope you will come forward and let us know how we can be
    of support to you.
        Let me focus on Iraq for a moment, because clearly I know
    we face many threats, and we have talked about them here, to
    homeland security, but our ability to secure Iraq in the near
    and mid-term so that the transfer of sovereignty can occur, so
    that the elections can occur--I do not know in all the
    responsibilities we have that there is anything more important
    that we are going to have to try to do in the next 6 to 8
    months.
        What lessons have you learned from what is going on there
    now in a broad sense? There is such good news happening there,
    in terms of the interim constitution, the oil industry picking
    up and producing more, and the polling showing the number of
    Iraqis who are optimistic about their future. But in the mean
    time, of course, these terrorists are killing a lot of
    Americans and a lot of Iraqis, and until that security is
    restored all the other good things that are happening are going
    to hit a wall.
        Can we stop this insurgency?
        General Brown. Sir, I think we are doing a great job over
    there doing it. All the SOF over there today are in support of
    General Abizaid. We are out on the ground and we are developing
    the situation, developing intelligence, taking bad guys off the
    street, and we are doing it at a very rapid rate. We are
    working very hard on that.
        Additionally, we are, from a special operations
    perspective, adding that stability and security to the country.
    We in special operations play a big role because we also have
    the civil affairs forces, of which we have over 1,200 deployed
    over there, about 800 or so in Iraq and the other 400 in
    Afghanistan. Additionally, we play a big role in the security
    and stability of Iraq because we also own the psychological
    operations forces, which are the experts in providing
    information.
        We play a big role in all those and I think the progress is
    very good in every one of those areas.
        Senator Lieberman. Let me ask you this final question. In a
    country that I guess is about as large as California, with a
    lot of vulnerable targets obviously, and an enemy that wants to
    frustrate the progress, stop it, turn it around, and create
    chaos, how do we stop them?
        General Brown. Sir, I think we just keep hacking away at
    it. For them it is a target-rich environment.
        Senator Lieberman. Right.
        General Brown. The inert explosive devices (IEDs) are a big
    problem for us over there. It is very difficult to defeat the
    IEDs. We have a great program going on to try and work to stop
    those, but it is just one of the things that creates this
    perception of chaos over there.
        But I think we just keep working on it. We try and take the
    bad guys off the street and defeat them. We continue to build
    the infrastructure and stabilize the country, and we get the
    information out of exactly all the good news and good things
    that are going on.
        Senator Lieberman. Is our intelligence on the enemy there
    improving? It is not an enemy in a conventional sense,
    obviously. They are disparate, they are operating in cells;
    they are connected, they are not connected. Are we breaking
    through?
        General Brown. Sir, we have a great intelligence lashup
    over there. Our SOF, specifically, that are operating out in
    the villages and towns, are able to work intelligence very
    rapidly. That is one of the great success stories that we are
    learning over there. A lot of that is based on our ability to
    have interrogators and interpreters and have a language
    capability and some cultural awareness, so that when they go in
    and hit these targets, the intelligence gets instantly
    processed, so that if the target has a data point where you can
    go and immediately take out another target, that will just
    continue to build success upon success.
        At the operational and tactical level on the ground, the
    intelligence processing between SOF and the other folks that do
    that is very good.
        Senator Lieberman. Thanks, General. I thank you all.
        I have so many more questions, but Senator Roberts is next.
    He is a very important and busy man and I do not want to keep
    him waiting, so I will yield.
        Senator Roberts [presiding]. Thank you, Senator. Three
    years ago, the Subcommittee on Emerging Threats and
    Capabilities, which is the subcommittee that was initiated
    through the farsighted commitment by Senator Lieberman and
    Senator Coats of Indiana, and then the chairman who led the
    effort, we became concerned that there was no single
    accountable official in the DOD specifically responsible for
    combatting terrorism. That obviously led to the ASD-SOLIC being
    designated as that number one official.
        This question is for Secretary O'Connell--and Paul, it is
    good to see you. Thank you for your service and thank you for
    your service in the House.
        Secretary McHale. Thank you, sir.
        Senator Roberts. Who now is the single accountable official
    in the Department that is responsible for combatting terrorism
    policy?
        Secretary O'Connell. Sir, I am.
        Senator Roberts. You are? You are the one?
        Secretary O'Connell. Yes, sir.
        Senator Roberts. So 3 years ago, when we asked the four
    witnesses to come in and sit down in order of their
    accountability and in regards to who was in charge, and they
    really could not figure out where to sit--so we have made some
    progress without question in that regard.
        I was going to ask General Eberhart about his experience in
    exercising the Nation's response plans with regard to the DHS
    and the lessons learned from the exercises that you have
    described, but Senator Inhofe has asked that question and you
    have responded very well. I just encourage you to keep those
    exercises coming and I think they are very valuable.
        I do have another question for Secretary McHale. A recent
    Defense Science Board (DSB) study concluded that if the
    homeland were attacked, DOD could be called on or it probably
    would be called on without question to assist with a response
    to the various incidents. This study stated, and I am quoting
    here, ``The execution of this mission could require
    capabilities in areas where the Department is deficient,'' and
    listed the following three:
        One was in regards to mitigation; two, the ability to surge
    medical capabilities. Within that statement was the figure that
    if you go nationwide and take a look at the hospital beds that
    are available in our Nation's hospitals, obviously it will vary
    from place to place, but we get down to about an average of six
    beds per hospital. That is a rather critical concern. Then the
    third one was in regards to the communication operability.
        The report went on to call for increased emphasis and
    priority obviously in funding for these areas. Could you tell
    me just briefly what the DOD is doing to address this very
    critical shortfall in each of these areas?
        Secretary McHale. Senator, my office worked very closely
    with the DSB in preparation of that study. A member of my staff
    was the secretary for the DSB study and our coordination could
    not have been closer. So there was nothing in the study that
    surprised me, and I am in general agreement with really the
    superb effort that they completed.
        Ordinarily when we would have a domestic attack, the
    President would declare a major disaster under the Stafford
    Act. The DHS would take the lead. FEMA would be the subordinate
    element of the DHS that operationally would take the lead, and
    FEMA would then have the authority by law to come to the DOD
    with a request for assistance so that we might provide various
    capabilities, up to and including for instance JTF-CSTs, a very
    large task organization specifically trained for WMD response.
        Long-term mitigation would not ordinarily be seen as a DOD
    mission. Depending upon the nature of the contaminant, it might
    well be an Environmental Protection Agency (EPA) mission. But
    certainly in the immediate aftermath of an attack we would have
    a response capability that could be vitally important. We now
    have that capability in JTF-CSTs, and under General Eberhart's
    leadership we are developing similar capabilities in other JTFs
    of similar size, so that within hours after such an attack very
    large DOD forces are trained and equipped to deploy in support
    of the FEMA-led civilian mission.
        Senator Roberts. That was my next question, in terms of
    time. You are saying that is within several hours in regards to
    the presidential declaration and then you go through those
    various chains of events that you've described.
        Secretary McHale. Yes, sir.
        Senator Roberts. So you could respond within several hours
    to a chemical, biological, radiological, or nuclear (CBRN)
    attack or a mass casualty event?
        Secretary McHale. Yes, sir. The actual time frame is I
    believe classified, but it is measured in hours. The capability
    is one of echeloning forces into the theater. That is, the lead
    elements--and General Eberhart is more expert in this area, but
    the lead elements of JTF-CSTs would be able to deploy very
    quickly, and the follow-on elements similarly would deploy
    within hours, hours being measured in slightly more than days.
        But we are talking about a rapid, almost immediate response
    in terms of initial capabilities, with very robust capabilities
    following shortly thereafter. These units involve a range of
    capabilities, everything from assessment, decontamination,
    medical capabilities, everything up to and including mortuary
    affairs, which is a very challenging mission requirement in a
    contaminated environment.
        Senator Roberts. I remember the hearing that we had here
    about, oh, 2\1/2\ to 3 years ago, and we actually had members
    of the Intelligence Committee, the Armed Services Committee,
    and even the Appropriations Committee here. We asked 46
    agencies at that particular time, in regards to homeland
    security: Number one, who is in charge; number two, what is
    your mission; number three, what do you really do; and number
    four, what do you need in terms of priority funding?
        Of course, the answer to all four was: yes, I am in charge,
    and here is our mission and here is what we want to do.
        Then we had the sheriff from Arapaho County, Colorado, who
    was the very last witness, and he said: Senators, I will tell
    you what. It is going to take you feds about 72 hours to come
    out to where I am and I have news for you. Until you get there,
    I am in charge; and I have not seen one damn thing yet.
        Now, that was 3 years ago. We have come a long ways from
    that and I credit all of you in regards to that effort.
        My time has expired. I would like to ask General Brown how
    well you think we are doing in transferring technology from the
    research labs to the warfighter on emerging threats. We have
    that jurisdiction, and we just had the Defense Advanced
    Research Projects Agency (DARPA) gizmo show--those are my
    words, not theirs--in regards to the technology to get
    something off-the-shelf, to get it into the warfighters' hands,
    to respond to the immediate concern, i.e., the protective armor
    in regards to the high-mobility multipurpose wheeled vehicles
    (HMMWVs), all of that.
        Do we have the process now down to where you can get what
    you need?
        General Brown. Sir, we have a great process. Under our
    acquisition authority I have a group of people that are out
    looking for high tech solutions. We work very closely with
    DARPA. We routinely run exchange days to make sure that our
    operators have a chance to see everything that DARPA's working
    on.
        But quite frankly, it is not only that. We are reaching out
    to industry. I have a group of people that work very closely,
    that go to all the trade shows and are out there searching for
    what our requirements are. Many of those people came out of the
    field and are operators, so they know what they are looking
    for.
        Senator Roberts. I appreciate that.
        Thank you, Mr. Chairman.
        Secretary O'Connell. Excuse me, Mr. Chairman. Senator
    Roberts, if I could be permitted to respond or to expand the
    response to Senator Roberts' question when he was addressing
    Secretary McHale and myself. The single DOD point for
    counterterrorism within the office of the Under Secretary for
    Policy, who is my boss, he of course is responsible to the
    Secretary of Defense. But in the chain of command for
    counterterrorism activities, that would flow of course not
    through me or through Under Secretary Feith. It would flow
    directly from the Secretary to a combatant commander such as
    General Brown. Counterterrorism is in his portfolio and in my
    portfolio on the policy side. But I do report to Under
    Secretary Feith and I just wanted to clear that up, sir. I
    thought you were referring between Secretary McHale and myself.
        Chairman Warner. I think it is important that clarification
    is in there.
        Senator Roberts. That is fine. Thank you.
        Chairman Warner. I would like to note that Senator Roberts
    hosted a SOF event last night in this building, and I was
    privileged to join. I was very impressed. I hope you were too,
    Senator, by the ability of those young troops to interpret the
    most complicated and technical operating equipment.
        Senator Roberts. I stood at parade rest, Mr. Chairman, and
    that is pretty good for a marine who very grudgingly admits
    that SOCOM is second to none in regards to their capability, in
    part because they have marines on board. [Laughter.]
        General Brown. Thank you very much for hosting us the other
    night.
        Senator Roberts. Does the Secretary agree?
        Secretary McHale. I would certainly support the Senator.
        Senator Roberts. Semper fi.
        Chairman Warner. Let us get back to business here.
        Senator Pryor, restore order, please.
        Senator Pryor. General Brown, I would like to ask you about
    something you said a few minutes ago, or maybe I should say a
    few Senators ago, when you were talking about retirement. I
    assume you are talking about SOF?
        General Brown. I am.
        Senator Pryor. Tell me again? At 20 years a lot of SOF get
    out of the military? Tell me about the 12 year, 20 year?
        General Brown. We have many skill sets in the special
    operations community. Every one is different and has unique
    challenges to retention and recruitment. But the one I am
    specifically discussing is our Green Berets, and that is the
    core of the Army special operations component.
        We traditionally recruit those guys out of the force at
    large. So these individuals may already be in the Service for 6
    or 7 years or less, but they are usually at about the 6-year
    point. We then bring them in and put them through about an 18-
    month course to make them a Green Beret. Once they graduate
    from that, then we will get 12 to 14 years of service out of
    them before they hit the 20-year point.
        If we can keep those guys past the 20-year point, out to
    the 26-year point or the 28-year point, that saves us somebody
    we obviously do not have to recruit, retain, and train. While
    we want to retain all those guys below the 20-year point also--
    and we do have some of them getting out to take these lucrative
    jobs--one of the key points in the article I was referencing
    talked about the folks that retire at the 20-year point.
        Senator Pryor. So give me your ideas on how that should
    work, then? Should we have special incentives for them to stay
    in? How do you think that should work?
        General Brown. I think that there are a lot of options and
    we are mulling over a bunch of those from this focus group. We
    brought in the wives and the special operators. By the way,
    those were not just Green Berets that we brought in. We also
    brought in our SEALs, Air Commandos, and others, so that we got
    a good view from all of our special skill sets.
        An incentive package may be one of those issues. Education
    opportunities may be another. The number one retention issue in
    any Armed Force is job satisfaction. Our folks on the
    battlefield today have great job satisfaction, but they also
    have a concern to take care of their future and their families,
    and at the 20-year point if you can get out and go right back
    and do much of what you are trained to do and make five, six,
    or even eight times the money that you are making, it is a very
    lucrative opportunity for them.
        Senator Pryor. Right. In Secretary O'Connell's statement on
    page 8, it said: ``In many respects, force management is the
    most critical problem facing SOF.'' This kind of begs the
    question about recruiting and retention. Should we, in your
    view, General, differentiate with special operations, even to
    the extent of making them into some sort of specialized branch
    of the service? I am not quite sure how but should we
    differentiate, given the fact that we do have quite an
    investment in these soldiers and they are extremely good at
    what they do? Should we differentiate in some way?
        General Brown. We already do to a certain extent. There are
    provisions for special duty assignment pay, which our A-Teams,
    our Green Berets, and our SEAL teams get. So we already do
    differentiate between them and other skill sets in the
    military, but it is not a great deal. Those are the kind of
    things that we need to address in how we are going to work this
    retention problem.
        I will say quickly on the recruiting issue you mentioned
    that today our recruiting is very good for SOF. Every seat in
    every special operations school we have is filled. Now, that
    does not mean that you will immediately run a couple classes
    and fill up the force, because today only about 23 percent of
    the people that sign up to be a Green Beret or a SEAL actually
    make it all the way through the course.
        Senator Pryor. Really? I did not realize that.
        Secretary O'Connell, what about your thoughts on--I do not
    mean this in a bad way--special treatment for special
    operations? What is your view of how much we should
    differentiate or incentivize them?
        Secretary O'Connell. Sir, it is a very good question. We
    could literally spend weeks addressing it and I know we do not
    have weeks. I was privileged to spend yesterday with General
    Brown and his combatant commanders and his senior enlisted
    advisers and other specialists that have looked specifically at
    this program. I think there is a range of options that can be
    taken.
        We have to remember first of all that these special
    operators come from the Services and we need to coordinate with
    the Services. Sometimes they go back to their own Services. It
    is a continuous problem. I will say that I think we need to
    understand that as technology moves forward the unbelievable
    capability of many of the special operators, particularly on
    the Green Beret side, the Ranger side, the SEAL side, Air Force
    Special Tactics personnel, and others, as they are able to
    integrate themselves more effectively on the battlefield with
    technology and using our other Services, they can impose a
    tremendously lethal blow on the battlefield working in small
    units, as we have seen.
        Therefore, their ability to equate to the combat power that
    used to be handled by 8, 10, 12, maybe 100 people is something
    we should take into account as we look forward down the line in
    transformation.
        But your question is a good one. We could give you many
    responses across the board, but it is something we are very
    conscious of. We do not want to get an ``us versus them''
    capability, but the reality is that the ``us'' is pretty darn
    good.
        Senator Pryor. Thank you.
        General Brown. Sir, could I readdress that one last time?
        Senator Pryor. Yes.
        General Brown. I do not believe it is about special things
    for SOF. I think as you look across all of the Services there
    are other areas where we have had shortages and that we have
    had to make special considerations to keep those kind of
    skills. Aviators are a great example, all the initiatives that
    we started to keep aviators and doctors. There are special
    considerations already being made. I think that is more what we
    are talking about. We are not talking about singling them out
    for special consideration for special people.
        Senator Pryor. Thank you.
        Chairman Warner. Thank you very much, Senator. That was an
    interesting line of questioning.
        Senator Clinton. Thank you, Mr. Chairman.
        Thank you, gentlemen.
        Secretary McHale, during your confirmation hearing last
    year I raised concerns about the numbers of firefighters,
    police officers, and emergency personnel who were being called
    up, and of course we have seen an increased OPTEMPO even since
    your confirmation hearing. In February of last year I wrote to
    Secretary Rumsfeld about this issue, and I appreciated your
    pledge and that of the Secretary to find answers as to what the
    impact of the call-up of these first responders are, because it
    connects with what you are doing on homeland security with
    these new CSTs. It is a very critical question to much of what
    we are discussing today.
        Now, I have been trying on my own to gather some of this
    information. For example, the latest information I could get is
    that in 2002 the New York Police Department spent more than
    $200,000 a week to cover their reservists and firefighters.
    Well, they covered their reservists who were in the police
    department. The fire department spent more than $100,000 a
    week. We have $300,000 a week coming out of the New York City
    budget.
        We also have problems in smaller communities, like Niagara
    Falls. The Niagara Falls Police Department spent more than
    $350,000 last year to cover their officers away on military
    leave. They expect to spend the same now. I have gotten
    information from a variety of other States, from Utah to North
    Carolina to Texas to Georgia.
        We are still concerned about this because it is a
    deployment of personnel and resources and, just as the SOF take
    a lot of time to learn their job, to get ready to carry it out,
    we found tragically on September 11 that a lot of our
    firefighters and police officers also take a while to
    understand exactly what they need to do, and we are losing a
    lot of those people to their Reserve and Guard duty.
        Have you been able to conduct the study that I requested
    last year and do you plan to publicly release the results of
    that? Are there any policy changes that you might consider
    because of the impact?
        Secretary McHale. Senator, the issue that you raise is very
    challenging, not only in the public sector, but for private
    sector employers as well. When you had asked me the question
    during the confirmation hearing, I did not have the
    information. The issue that you raise is one that falls within
    the jurisdiction of the ASD for Reserve Affairs. We in ASD-HD
    operationally, we provide the policy guidance; General Eberhart
    operationally commands those Reserve Forces that are actually
    dedicated to the homeland defense mission. But issues of
    mobilization, recruitment and retention fall under the
    authority of the ASD for Reserve Affairs.
        In response to your inquiry I went back to Mr. Hall and he
    told me at that point that we did not have in our database of
    information the ability to identify which of our reservists
    were simultaneously deployed as first responders. It was
    challenging, not so much in the case of professionally employed
    first responders, but because so many of our communities,
    particularly in your State, in the rural areas, are served by
    volunteers.
        We knew that an individual reservist was employed working
    for, let us say, a manufacturing company. What we did not know
    was that in his or her part-time hours he or she might have
    been a volunteer for a paramedic unit.
        You and I had met on the subject and I had given you at
    that point the latest information that I had. I also brought to
    your attention that there is what I will call a delayed entry
    program. That is, if a first responder is notified that he or
    she is being brought to active duty, the community in which
    that first responder works can request and will be granted by
    the DOD a brief delay to bridge the gap so that we do not have
    an abrupt departure of that first responder.
        Lastly, I will now get back to Secretary Hall and find out
    what progress has been made in the database, to see if we can
    identify how many professionally employed and volunteer first
    responders are also reservists, so that we can quantify not
    just for the public sector but for the private sector as well
    the dual obligation.
        Senator Clinton. I appreciate that very much, Mr.
    Secretary.
        I am also concerned about the continuing coordination
    between the DOD and the DHS, and I would like to ask you, Mr.
    Secretary, and you, General, as well that--last year we were
    told that the DOD did not coordinate their heightened threat
    levels with the DHS's color code. Now, can you tell me whether
    there have been any changes to code orange or code red with
    respect to DOD and NORTHCOM? In the event of a decision to
    increase the threat level, who makes the call on whether we
    increase defensive measures for New York? I am very focused on
    our continuing vulnerability and the fact that we remain such a
    high target.
        Suppose the DHS initiated a higher code level of alert, but
    the DOD and NORTHCOM decided not to. Where are we supposed to
    end up there in New York, particularly New York City? The
    police and firefighters and the mayor's office, they have their
    own intelligence because we are so big and we feel the threat
    so intimately. But obviously the coordination with all of you
    is equally critical.
        Can you explain where we are in all of that thinking now
    and what the sequence would be?
        Secretary McHale. Senator, I would be happy to and I think
    General Eberhart would probably want to comment then perhaps on
    the air threat levels and some of the operational matters that
    fall within his purview.
        At the highest level, I can give you a complete assurance
    that we have made dramatic progress in the last year, in terms
    of coordinating DHS and DOD activity. I mentioned briefly a
    little bit earlier that members of my staff now work full time
    in the Homeland Security Operations Center out on Nebraska
    Avenue, completely engaged 24-7, 365----
        Senator Clinton. Mr. Secretary, if I could just stop you a
    second. Does that mean that if we see Secretary Ridge on
    television raising the threat level that there has been an
    agreement and a signoff in the DOD on that increased threat
    level?
        Secretary McHale. There is certainly a coordination. There
    is not a signoff in that the statute that sets the level, as I
    recall, the system level, is the Homeland Security Act of 2002,
    and the Secretary of Defense does not have a veto, he does not
    have to sign off.
        But I can tell you from my own experience and
    participation, there is robust communication and coordination.
    Before the Secretary of DHS, in consultation with the Attorney
    General, raises it, let us say, from yellow to orange, the
    Secretary of Defense has full situational awareness of what is
    going on, and ordinarily he or a designated representative--at
    times it has been me in the past--can participate in that
    discussion as Secretary Ridge makes his statutorily assigned
    decision.
        Now, the Secretary of Defense, within the NORTHCOM AOR,
    decides our force protection condition. He confers directly
    with his combatant commander. He discusses that issue
    ordinarily with General Eberhart. General Eberhart may make a
    recommendation. But the actual decision for force protection of
    DOD facilities is made personally and directly by the Secretary
    of Defense within the United States.
        Senator Clinton. Of course, I am concerned about DOD
    facilities, but I am also concerned about civilian facilities
    and obviously the assets to provide whatever additional
    support, overflights, whatever kind of resources are needed
    more likely to come from DOD than from DHS. At what point,
    General, do you get into that conversation, and do you then
    make the decision or is that not yours to make?
        General Eberhart. I think what is important to note here is
    why we are going to change the color code or the threat level.
    What is the threat? What have we perceived that would make us
    change? To give you an example, maybe it is a threat to a
    subway system. That may not be a reason to increase the air
    patrols. So that is what Secretary McHale is referring to. We
    talk about what the threat is and why we are changing the color
    code or why we are changing the force protection or the anti-
    terrorism measures that we are taking.
        If it is a threat we think we can deter, defeat, and
    prevent by using a combination of things, then you will see
    those two things running side by side, just like we saw over
    the holiday season. When we changed the color code, we also
    changed our force protection measures--our air patrols, the
    number of aircraft we had on alert, et cetera.
        What is important to note is why we are changing it and
    what the relevance is to what the DOD could provide or the DHS
    and other law enforcement agencies can provide. But now we are
    talking. Frankly, at the beginning we were not. So we might
    read about a change in a color code, we might read about a
    change in the force protection. Now it is very well linked. We
    know why. We can take the appropriate measures.
        Senator Clinton. Thank you.
        Chairman Warner. Thank you, Senator. That was very
    interesting.
        Senator Bill Nelson.
        Senator Bill Nelson. Thank you, Mr. Chairman.
        General Eberhart, this afternoon in a subcommittee of this
    committee we have to start making some decisions about keeping
    a second line open for expendable launch vehicles. That is not
    your AOR, but perhaps in a side bar conversation, because of
    the former hat that you wore at Space Command, I would be
    appreciative of your thoughts on this. It is going to be a
    pretty critical decision and we cannot afford to mess it up.
        Let me ask you, on the subject of this hearing, rumors
    continue to abound that Secretary Rumsfeld wants to combine
    NORTHCOM with Southern Command (SOUTHCOM). In your professional
    opinion do you think NORTHCOM is prepared to accept a
    significant increase in duties and an expanded AOR that would
    include all of SOUTHCOM?
        General Eberhart. Sir, despite the rumors, the ground truth
    is that the Secretary of Defense, as he has done for the past 3
    years, has requested a review of the Unified Command Plan
    (UCP), something that we do every year as a matter of course.
    Part and parcel to that, is there a way to organize better in
    terms of perceived or real seams between commands and
    commanders' responsibilities and authorities? Is there a way to
    organize better for this global war on terrorism and what we
    see in the 21st century versus what we saw in the Cold War?
        I think the steps the DOD, under the Secretary's
    leadership, has taken over the last 3 years show he is very
    objective. So the Secretary has not decided that he is going to
    combine them. He has not said he wants to combine them or
    establish a new command. ``Combine'' is probably not the right
    verb. But he wants a good, objective look at what the pros and
    cons would be of combining them. That is what SOUTHCOM,
    NORTHCOM, the Joint Staff, and offices in the Office of the
    Secretary of Defense (OSD) are doing as we speak.
        Would it work? Sure, we can make anything work. Is it the
    right thing to do? I am not sure, because I have not seen the
    analysis yet, and the only thing I would give you would just be
    my intuition.
        So I believe it is something that warrants a look, and
    probably will warrant a look every year for many successive
    years, as we have looked at it since the early 1990s.
        Senator Bill Nelson. Well, at some point I would like your
    professional opinion. So if you do not want to offer that now,
    at some point in the future I would like to have it.
        I will give you my professional opinion. With the
    excellence of the four-stars that we have had there, like
    General Hill now and General Pace before him, that is an area
    of enormous responsibility. They not only have to be a military
    commander, they have to be a diplomat as well, dealing with the
    heads of government of all of those scores of countries.
        The other thing is there is a distinct military challenge
    for the future, because as terrorism moves from Asia and the
    Middle East into Africa and then into Latin America, we have a
    significant military threat.
        Let me move on. General Brown, you have the SOF that are
    getting busier and busier, especially as we reorganize the
    forces. There is an article on the front page of the paper
    today about reorganization, which I have discussed with General
    Jones at length. The thrust of the article is about how we are
    going to reorganize the troops over in Europe.
        But wherever we are, your troops are really going to be a
    major component. My question is, how are you going to manage
    this ever-increasing OPTEMPO when you have a limited size of
    special operations units?
        General Brown. Sir, right now we are involved in the
    biggest deployment in the history of special operations. 73
    percent of all our deployments are in the Central Command
    (CENTCOM) AOR right now in Iraq and Afghanistan. This is the
    highest OPTEMPO special operations has ever had, to include our
    civil affairs and psychological operations forces.
        For example, traditionally, we take a SOF group and they
    are oriented on a region of the world. The way we are
    accomplishing it today, and to sustain our Green Berets over
    there, is we are using other special group forces, including
    our two great 19th and 20th SOF and National Guard units, and
    we are putting them into the fray in Afghanistan and Iraq so
    that we can get a manageable OPTEMPO for our SOF.
        We just increased the amount of SOF over in Iraq over the
    last 4 or 5 months significantly and it is still manageable. We
    are working very aggressively to try and fill up our units. We
    traditionally stay about 85 percent full in a regular SOF or
    SEAL unit not because we cannot get the people, because we have
    to get them through the training.
        So what we are doing is enhancing our schools so that we
    can increase the throughput without changing any of the
    standards of what it takes to be a special operator.
        So in those forces I think all that is manageable. As I
    mentioned earlier, the place we are getting stressed right now
    is in our civil affairs forces, because out of our 28
    battalions, 27 of them are in the National Guard or in the Army
    Reserve, and we are coming up to a mobilization problem with
    them. We are taking that on right now for the AOR that has
    taken all those forces a couple ways.
        One is that we think the requirement for them will reduce
    as the infrastructure continues to build over there. It is
    already starting to reduce the requirement for our civil
    affairs forces. Additionally, in our fiscal year 2005 budget we
    will grow additional civil affairs forces, both active and
    Reserve, so that will help us with some of those problems.
        We will grow from fiscal year 2004 to fiscal year 2009;
    about 2,700 total people will be added to SOF. Some of our most
    stressed areas are going to grow. We are going to grow a brand-
    new MH-47 Echo battalion. That is very important. We are going
    to grow for a brand-new C-130 Combat Talons. That is already
    happening. We have just added four AC-130 gunships.
        There is a combination of all of these things going on that
    will help us manage our OPTEMPO in the future. Additionally, as
    I mentioned, we are prioritizing the deployments now and we are
    in charge of where they are going, and that helps us a good
    deal in managing OPTEMPO. Additionally, as we go into the
    theater geographic combatant commanders' AORs, some of our
    presence will be done through our exercise programs and our
    joint combined exercise training and joint exercise programs,
    that will allow us to maintain that presence, but it will be on
    a rotational basis.
        This is a big one. We work force management every single
    day to make sure we are doing the best possible job we can to
    sustain our force.
        Senator Bill Nelson. I think your command is the place to
    be for the future.
        General Brown. So do I, sir.
        Senator Bill Nelson. So good luck.
        Mr. Chairman, I have a couple more questions.
        Chairman Warner. Go ahead.
        Senator Bill Nelson. Secretary McHale, obviously we are
    using the National Guard a lot more than we have in the past,
    and so the question is homeland security. If you have the
    National Guard over there--and we are well aware of that in
    Florida, by the way, because at one point, because the 124th is
    so good, you had them in there first and it was right in the
    middle of hurricane season. If we had had another monster
    hurricane we would have had difficulty, and the head of the
    National Guard can tell you that.
        My question to you is about homeland security. If we are
    relying on the National Guard and Reserve so much in the force
    protection over there, what do we do to keep ourselves
    protected here?
        Secretary McHale. Senator, when I served back in the House
    there was a lot of discussion back in those days--the late
    1990s--about excess force structure and end strength in the
    National Guard. We had eight Guard divisions at that point that
    were not written into the war plans and there were frequent
    discussions. I was the co-chair of the Guard and Reserve Caucus
    and I am very familiar with the Florida Guard. General Harrison
    is a very close friend of mine.
        There were significant debates that took place as to
    whether or not we had too many folks within the National Guard
    at that time. I do not hear that discussion taking place these
    days. As I indicated earlier, by the spring of this year I
    think 37 percent of our force in Iraq will be drawn from the
    Reserve components and a large piece of that from the National
    Guard.
        Lieutenant General Blum, who is the Chief of the Guard
    Bureau, has looked very carefully at the specific issue that
    you have raised. What we are looking at is a continuation of
    Guard warfighting responsibilities overseas, with more than
    sufficient assets remaining at home for the anticipated
    homeland defense missions. Those missions typically would
    involve things we talked about earlier, such as the CSTs and
    perhaps integration into our consequence management
    capabilities.
        Also, Lieutenant General Blum is now forming joint forces
    headquarters for all of the Services, title 10 as well as the
    National Guard, at the State level under the immediate
    leadership of a National Guard staff, National Guard in the
    sense that the leadership at the senior levels would be
    coordinated by the National Guard.
        The most manpower-intensive mission that we see emerging
    for the National Guard is critical infrastructure protection.
    So if in Florida there is a credible threat, let us say, to a
    nuclear power plant and that threat is so detailed that we
    believe that civilian law enforcement cannot adequately protect
    that facility, it is anticipated that the National Guard may
    well be deployed by the governor in State status or perhaps in
    the future in Title 32 status for the physical defense of that
    facility.
        At the end of the day, a very careful analysis conducted by
    Lieutenant General Blum in reviewing existing force structure
    and end strength has led him to believe that we do have
    sufficient forces for the Guard to continue participating both
    in overseas warfighting requirements as well as the foreseeable
    homeland defense missions. We have enough folks to do it.
        Senator Bill Nelson. I would like to also ask you and
    perhaps General Eberhart a question. There was a new criteria
    that was added for the Base Realignment and Closure (BRAC)
    Commission to consider, which was the measurement of an
    installation's value to homeland security. So are you going to
    be personally, the two of you, are you going to be personally
    involved in that BRAC analysis and decisionmaking process?
        Second, what are the elements that you use to measure the
    value of a base to homeland security?
        Secretary McHale. The BRAC process obviously involves the
    close consultation with and insights provided by the military
    commanders. I would certainly expect that General Eberhart's
    opinion would be solicited because it is an important opinion.
    He has insight operationally into many of these matters.
        But the BRAC process itself is being led primarily by
    civilians, with the input of military commanders who help to
    shape their judgment. Ray DuBois has that lead for the DOD. He
    and I met yesterday on this very issue. The criterion that you
    cited I think is the number two criterion that was listed among
    the points to be considered when determining whether or not a
    given installation will be BRAC'ed.
        Points one and three also have relevance to homeland
    security implications, and I will be directly and personally
    engaged with Mr. DuBois as he makes these determinations during
    the BRAC process as to whether or not a given installation is
    so crucial to homeland defense that it ought to be spared from
    consideration of closure.
        Having said that, because of the nature of homeland defense
    missions, there are very few installations that have unique
    infrastructure that would require their continuing operation to
    support the more general homeland defense requirements--
    infantry requirements, for instance, for site security. Some
    exceptions might be unique port facilities or perhaps
    facilities that have been constructed to support training with
    regard to WMD.
        But fortunately, for the most part we can train and deploy
    homeland defense forces in a wide variety of circumstances at a
    wide variety of locations.
        Senator Bill Nelson. I am not concerned about the process
    as long as I know that the uniformed military is involved in it
    and making decisions.
        Secretary McHale. Yes, sir.
        Senator Bill Nelson. General Eberhart, are you going to be
    involved in making these decisions?
        General Eberhart. Sir, I have not been told that I will
    specifically be involved, but I have every reason to believe I
    will be involved, and I will certainly ask to be involved. In
    fact, the criterion you cite is one that we promoted from
    NORTHCOM and NORAD, because we believed that criterion was not
    there before, and understandably so, in previous BRAC
    processes. But, when you look at the global war on terrorism,
    when you look at proximity to our population centers and key
    infrastructure, we think it is a criterion that should be
    included this time, and we applaud its inclusion.
        Chairman Warner. Thank you, Senator, very much.
        Senator Bill Nelson. Thank you.
        Chairman Warner. I think those were very relevant
    questions. I started out this morning talking about Secretary
    Rumsfeld's plan for relocating, and that will have an impact on
    the current BRAC process, I am sure, if he brings a lot of
    those troops home.
        Senator Bill Nelson. Mr. Chairman, as long as the uniformed
    military is directly involved in the decisionmaking, then I
    have a lot less worry. It is when they are excluded that the
    suspicion-caution flags come up.
        Chairman Warner. In the BRAC process they give specific
    recommendations to the Secretary. I think that would constitute
    active participation.
        I want to wrap up the hearing. We have really had a very
    good hearing today and I am exceedingly pleased with the
    information that you have imparted to the committee.
        In my trip to Afghanistan, Secretary O'Connell and General
    Brown, I was troubled to learn of the large increase in
    cultivation and trafficking in opium in these countries. The
    National Defense Authorization Act for Fiscal Year 2004 gives
    the DOD new authority to use DOD counterdrug funding in those
    countries. Are either of you involved in the decisionmaking
    about the Department's plan for combatting drug cultivation and
    trafficking in the region, and what efforts have been
    undertaken to fully synchronize these plans with the Department
    of State efforts?
        I have talked with General Jones about this, because there
    are plans for enlargement of NATO's role. Now, I realize that
    is out of your sphere of activities, but I stressed to General
    Jones my great concern that NATO should not be responsible for
    trying to curtail this drug trafficking. Yet, the amount of
    money being generated is enormous, and that is spreading into
    the communities, to the warlords and so forth, and of course it
    seems to me that complicates the work being done by our task
    forces over there as we try and bring about a greater degree of
    democracy.
        To what extent are either of you involved in this?
        Secretary O'Connell. Yes, sir. First, thank you for the
    question. As you may be aware, sir, the House has recently held
    several hearings on this and we have been able to testify.
    First, we do realize, the DOD does realize, that there is a
    nexus between the sins of narcoterrorism and the connections to
    terrorism itself.
        Within Afghanistan, sir, we asked for a supplemental, which
    was provided by Congress, of $73 million. Within this context,
    we recognize under several international agreements that the
    United Kingdom has the lead for counternarcotics activities
    within Afghanistan. However, the U.S. plays a significant
    supporting role. With the Department of State as the lead
    Federal agency, we coordinate very closely with International
    Narcotics and Law (INL) in the State Department.
        What we have come up with is a very good strategy. It is
    not a ``go out and hit the little guys''----
        Chairman Warner. Let me ask, who is the ``we?'' What ``we''
    have come up with?
        Secretary O'Connell. We within SOLIC, sir, as the lead
    within Mr. Feith's office.
        We work very closely with international law enforcement,
    with the State Department, with Assistant Secretary Charles. In
    fact, we have testified I think three times together. We have
    also worked very closely with Drug Enforcement Administration
    (DEA) Administrator Karen Tandy to come up with a comprehensive
    program that dovetails with the stability operations that are
    being put in place by not only U.S. forces, but the U.S.
    Ambassador and the Afghan government.
        We do not believe that we can do anything by going out and
    whacking the little guy, the farmer. There has to be an
    alternative. Any country that has 60 percent of its gross
    national product (GNP) coming directly from the cultivation of
    drugs obviously has to contribute to terrorism. Additionally,
    we have the problem in Iran, in the United Kingdom, certainly
    in Russia, where a great amount of the drug product goes
    directly to those countries.
        With that $73 million this year, sir, we have worked with
    the CENTCOM, General Abizaid and his J-3, to come up with a
    comprehensive series of strategies that allows us to focus that
    money on the following items: One, to be able to strengthen the
    border check points against known smuggling routes.
        Two, we are using additional funds to tap the intelligence
    agencies, particularly the National Geospatial Agency, to be
    able to identify those--we know the areas of cultivation, but
    the areas that we are most concerned about at this point in
    time, sir, are the labs. We want to additionally increase the
    capability that the Afghan police and army have to target drug
    labs and to develop intelligence and use communications
    successfully.
        Additionally, we have provided a joint fusion cell which
    will include the DEA and United Kingdom activities to better
    coordinate our activities in country.
        Lastly, CENTCOM has developed specific targeting activities
    to better integrate, not only within their normal military
    operations, to better integrate the fight against
    narcoterrorism. But it must be done in conjunction with what
    the Afghan government can tolerate and what they can enforce,
    sir.
        But I am very pleased with what progress the DOD has been
    able to make.
        Chairman Warner. Senators Stevens and Hollings and myself
    took it up directly with President Karzai. He was rather bold
    on it. He said: You know, we all make mistakes and the British
    made a mistake, because they started a program where they paid
    farmers to get out of the business. So the farmer down the road
    who was not growing poppy said: I am going to get into the
    business so I get some of the pay. All of a sudden this thing
    began to grow exponentially. That, coupled with I think a
    weather pattern that has enhanced the overall crop
    productivity, has worsened this situation to enormous
    proportions.
        I do not want our troops, whether they are American troops
    or coalition forces over there, subjected to the evils that
    drug profits can render.
        Well, look. You gave me a good long bureaucratic answer.
        Secretary O'Connell. Sir, that answer was hammered out with
    lots of hours with the Secretary, the Deputy Secretary, and the
    State Department. We believe that we have a reasonable
    approach.
        Chairman Warner. Are the Brits still in charge?
        Secretary O'Connell. Yes, sir. The Brits by agreement----
        Chairman Warner. By agreement with whom?
        Secretary O'Connell. With the U.S., sir. We signed an
    agreement I believe in 2001 between the DOD and various
    elements in the United Kingdom with respect to who took certain
    responsibilities in Afghan reconstruction and the United
    Kingdom has the lead. We have a very substantial part of that
    operation.
        Chairman Warner. We gave you $73 million to implement some
    of your initiatives.
        Secretary O'Connell. Yes, sir.
        Chairman Warner. What sort of money are they putting into
    it?
        Secretary O'Connell. Sir, I do not have the exact money. It
    is very significant.
        Chairman Warner. Very significant.
        Secretary O'Connell. Absolutely, as is the German----
        Chairman Warner. They are going to stop this paying off the
    farmer bit?
        Secretary O'Connell. Sir, I do not believe that that is
    currently part of the strategy. As a matter of fact, in looking
    for alternatives, one of the things that seems to have been
    useful, instead of growing wheat, they are looking at flocks.
    Increasing flocks of livestock seems to be helpful. But there
    has to be punishment and there has to be a shutdown of the drug
    labs and there has to be some risk associated with this
    activity, and right now in many places there is no risk.
        Chairman Warner. I personally am going to just follow this.
    I would like to see you perhaps in another 90 days and let's
    you and I sit down and check on it.
        Secretary O'Connell. I would be happy to, sir.
        Chairman Warner. I thank you very much for that.
        Unmanned systems. This committee, and I had a role in it
    through the years, has really put a lot of emphasis on these
    unmanned systems. I only wish Americans could have seen that
    array of unmanned systems that you had down there at that
    exhibit last night. It was remarkable.
        Secretary O'Connell. Yes, sir.
        Chairman Warner. To be a little prosaic, it reminded me of
    when I was a youngster many, many, many years ago and I built a
    lot of model airplanes. Those unmanned planes are just like
    model airplanes. Some of them had an 8-inch wingspan, some of
    them had an 8-foot wingspan. They have very simple engines, but
    they worked better than the old clunkers that we used to have.
        But this is just wonderful, because they are force
    multipliers, they are lifesavers. I hope that you feel you have
    adequate resources and incentive just to turn loose your young
    people to put their minds on how to build all of these things.
        Secretary O'Connell. Sir, we think that is a great area
    that we are putting a lot of time, energy, and money into,
    because if you put a SOF team of 12 men out by themselves hours
    from any other friendlies, having a hand-held UAV to provide
    them their own reconnaissance around or force protection, it is
    just a very valuable piece of gear to them. So we are working
    hard to field those as fast as we can.
        Chairman Warner. Good.
        Well, we wrote into our National Defense Authorization Act
    for Fiscal Year 2004 the requirement to make a study. The study
    is due on April 1, which is only a few days away. I would be
    astonished if it makes deadline. It would be the first in a
    long time. But did you have a role in that study being
    prepared?
        Secretary O'Connell. Sir, I do not believe we did. I am not
    sure. I will have to go back and take a look. But I am not
    sure.
        Chairman Warner. You would be eminently qualified to have
    had a role in it. I will find out.
        Now, closing down the hearing today, I bring back something
    that I have been hung up on for a long time, and that is posse
    comitatus, which those following the hearing might not
    remember. Way back in 1876 there was an election that was
    allegedly jiggered by use of Federal troops and, I think
    wisely, Congress and others tried to limit the role of our
    Federal forces as it relates to State activities.
        But now it has to be reviewed in the context of the ever-
    growing complexity of terrorism. General Eberhart, you very
    strongly said yesterday you are able to live under the existing
    law. I just want the record to reflect a little bit about your
    own professional views on that issue.
        General Eberhart. Yes, sir. As you said, you and I have
    discussed this on several occasions, at the confirmation
    hearing and last year's homeland defense hearing. In every one
    of these real world events, every one of these exercises, all
    these scenarios we run, we always take a very close look at
    whether or not posse comitatus or any other laws, procedures,
    or instructions tie our hands and keep us from doing what we
    need to do, and that is protect the American people and our key
    infrastructure.
        I am happy to report as of this date we have not found the
    situation. But I assure you, as I have in the past, just as
    posse comitatus has been modified many times since 1870 or
    whenever, if we find a situation where we think it should be
    modified in the interest of the citizens of this great Nation,
    we will not be reluctant to take that information to the
    Secretary of Defense and in turn to you and propose those
    changes.
        So I cannot sit here and say it never needs to be changed.
    I can just sit here and say as of now I do not know a change
    that needs to be made.
        Chairman Warner. That is a very clear answer.
        Do you have anything further, Secretary McHale?
        Secretary McHale. Sir, the only thing I would add to it is,
    as the General noted, there are numerous exceptions to posse
    comitatus. Posse comitatus only limits the use of Title 10
    forces for law enforcement purposes. If within the United
    States we use Title 10 forces for a military purpose, it falls
    under what is called the military purpose doctrine.
    Particularly if that involves foreign terrorists or a foreign
    policy consideration, then that activity is not covered by
    posse comitatus.
        So for instance, our quick reaction forces can deploy
    within the United States under the military purpose doctrine.
    They are not deploying for law enforcement purposes. They are
    deploying to defeat al Qaeda. That activity is not covered by
    posse comitatus.
        Then finally, sir, it is important to emphasize that the
    National Guard, both in State status and Title 32 status is
    similarly exempt from posse comitatus. So we have a combination
    of Guard capabilities and military capabilities when used for a
    military purpose, and that is a pretty big range of discretion
    in terms of the use of military force.
        Chairman Warner. On that issue I close out with a story
    from Senator Roberts, and I was listening in the hearing room
    when the old sheriff got up and said: It is going to take a
    long time for you folks to get here and I am going to be in
    charge, and I will do damn well as I please to straighten this
    situation out. So apply a little of that old guts to it and it
    will work out.
        Lastly, the force protection of our military bases and
    facilities here in the continental limits of the United States,
    which we now recognize is a potential area for problems.
    Overseas, the combatant commanders have the right to establish
    a uniform set of force protection measures throughout their
    AORs. Here, however, it falls to the individual Service
    chiefs--the Chief of Staff of the Air Force, the Chief of Staff
    of the Army, and so forth. I am concerned that we do not have
    someone looking at the uniformity of this situation.
        Now, what should we do here? Does this lend itself to some
    legislation on this subject? You may not be able to answer this
    today, but I would like to have you provide information in the
    next week or 2, Mr. Secretary, the views of you and perhaps the
    DOD on whether or not any legislation is needed to ensure that
    there is some uniformity among our bases and installations here
    in this country.
        [The information referred to follows:]

        The Secretary of Defense has made a decision on the force
    protection of our military bases and facilities here in the continental
    limits of the United States. Effective not later than October 1, 2004,
    the Commander, U.S. NORTHCOM (CDRUSNORTHCOM), will exercise
    responsibility for antiterrorism and force protection within the
    continental United States. This responsibility is subject to the
    following conditions: First, CDRUSNORTHCOM cannot move DOD personnel
    unless faced with a time-critical event involving potential lost of
    life, or personnel movement is required to prevent significant damage
    to mission critical infrastructure. CDRUSNORTHCOM will notify the
    Secretary of Defense immediately of such time-critical personnel
    movements. Second, CDRUSNORTHCOM will seek Secretary of Defense
    approval of pending changes to the force protection condition no later
    than 24 hours prior to implementation or as soon as practicable if
    faced with a critical event.
        Based on the decision by the Secretary of Defense, I do not believe
    legislation on this topic is necessary.

        Secretary McHale. Sir, this issue is right now before the
    Secretary of Defense and he has not yet made a decision. I
    think there is a consensus that the status quo is not
    acceptable in that the status quo does not provide for the
    uniformity of antiterrorism force protection conditions that
    you have described. As a matter of fact, at least three of us
    seated at this table have been deeply involved in that
    discussion.
        I anticipate that it will go to the Secretary of Defense
    within the next 2 weeks, and my expectation is that his
    decision will render unnecessary any legislation on the
    subject. He is going to decide what kind of command authority a
    combatant commander should have within his own AOR to achieve
    uniformity of antiterrorism force protection and what the
    relationship in terms of command authority should be between
    the combatant commander and the forces that are now within the
    individual services.
        So although there is spirited discussion on the issue, I
    think the Secretary is going to settle it within the next
    couple of weeks.
        Chairman Warner. General Eberhart, do you have some views
    on this?
        General Eberhart. Sir, I will echo what Secretary McHale
    said. Obviously, we have looked at several different ways to do
    this. The Secretary is concerned by what you said. He does not
    like the fact that in the past one Service might be at force
    protection condition alpha and another Service at bravo here in
    this AOR. In fact, now he is the person who synchronizes the
    force protection level for this AOR.
        So I think the question will remain whether or not he
    continues to do that or whether or not he has me do that in
    consultation with him. But, I make a recommendation.
        Chairman Warner. I think it would be very wise to repose in
    your command that authority. We would like to have a point of
    accountability and that would be a good idea.
        General Eberhart. Sir, that is one of the options he is
    considering.
        Chairman Warner. Well, indicate that I endorse that option.
        Thank you very much, gentlemen and those ladies that are in
    attendance and support, and all others. We have had an
    excellent hearing, with some very reassuring testimony.
        [Questions for the record with answers supplied follow:]
                  Question Submitted by Senator Lindsey Graham
                           arrow technology ventures
        1. Senator Graham. General Brown, the Central Intelligence Agency
    (CIA) has a venture capital program called ``In-Q-Tel'' that identifies
    and invests in companies engaged in cutting-edge technologies for the
    Intelligence Community. Similarly, the Army has a venture capital
    effort, mandated by Congress, focusing on new battery and power
    technologies. I understand that Special Operations Command (SOCOM)
    wants to establish a program akin to ``In-Q-Tel'' called, ``Arrowhead
    Technology Ventures,'' that would leverage innovative technologies for
    Special Operations Forces (SOF). Could you expand on Arrowhead's
    mission, how and when you would plan to execute it, and the benefits
    that your warfighters would gain from it?
        General Brown. During the past year, SOCOM has evaluated the
    potential for venture capital type initiatives in support of SOF and
    our global war on terrorism mission. Seeking the advice and mentorship
    of the CIA and ``In-Q-Tel,'' we have found two aspects of their success
    with the venture capital process which appear applicable to SOCOM
    requirements. The first is the opportunity to gain an early familiarity
    with start-up technologies that could prove beneficial for transforming
    SOF capabilities. Second, the venture capital process itself provides
    an excellent venue for working with emerging companies who have limited
    government development and/or acquisition experience but who have
    created cutting edge technologies. Should we receive such funding, I
    would envision a competitive environment wherein Arrowhead Technology
    Ventures as well as a number of other promising venture capital
    companies could be of assistance.
                                     ______

               Questions Submitted by Senator Joseph I. Lieberman
                     information sharing and communications
        2. Senator Lieberman. General Eberhart, in your written testimony
    you noted briefly that we ``have made significant progress in improving
    the exchange of threat information.'' You cited the example of the
    recent orange alert during the holiday season, when ``time-sensitive''
    information moved quickly from intelligence and law enforcement
    agencies to those decisionmakers who were challenged with mitigating
    various threats. I have no doubt that, when the threat alert is
    heightened, officials at all levels of government redouble their
    efforts to communicate. But, what has been done to change the day-to-
    day communication processes that many believe still do not result in
    adequately sharing information across all levels of government?
        General Eberhart. We are promoting information sharing among
    homeland defense and homeland security partners. To date we've outlined
    how to communicate with over 800 potential mission partners and share
    our Common Operational Picture with 35 different organizations,
    including 17 non-Department of Defense (DOD) agencies. In addition, we
    have established linkages with the Department of Homeland Security's
    (DHS) Information Analysis and Infrastructure Protection Directorate,
    the Federal Bureau of Investigation's National Joint Terrorism Task
    Force, the Terrorist Threat Integration Center (TTIC) and the CIA's
    Counterterrorist Center (CCTC).

        3. Senator Lieberman. General Eberhart, what is Northern Command's
    (NORTHCOM) role in effectively creating new processes and paradigms,
    where critical information is shared routinely, and not just during
    heightened alerts?
        General Eberhart. Homeland defense requires that we take an active
    role in eliminating impediments to information sharing. In June 2004,
    we will host the Chairman of the Joint Chiefs of Staff Joint Warrior
    Interoperability Demonstration to assess the military utility of
    potential homeland defense information sharing capabilities. This
    demonstration will involve 32 trials at 5 locations across the United
    States and include participation from the DOD and DHS. We will nominate
    successful results as joint standards and, if approved, provide these
    capabilities to our mission partners.

        4. Senator Lieberman. General Eberhart, what do you believe are the
    major obstacles that must be overcome before critical homeland security
    information is shared routinely, across all levels of government and
    with the private sector?
        General Eberhart. We believe the primary obstacle is cultural vice
    technical and more limited by policy and procedures than system
    incompatibilities. In real-world operations and exercises, we are
    promoting a ``need to share'' approach and are committed to improving
    situational awareness at the local, State, and Federal levels.

        5. Senator Lieberman. Secretary McHale, just as in combat
    operations, robust communication capabilities are essential to the
    successful execution of crisis response operations. The horrific
    attacks on September 11, 2001, exposed not only that our Nation is
    vulnerable to hostile acts, it also showed that the communication
    infrastructure relied upon by our first responders and regional and
    national leaders needs improvement. On that fateful morning,
    firefighters and police forces were not able to communicate with each
    other, and in some cases with local command posts, to attain better
    situational awareness. It is argued that many lives were lost due to
    the failures of our communication systems. This problem must be dealt
    with. Our Nation requires reliable communication capabilities linking
    state command posts, National Crisis Management Centers (such as
    NORTHCOM and the Department of Homeland Security Operations Center),
    first responders and our national leadership. What projects are the DOD
    and DHS undertaking to improve the Nation's crisis response
    communications infrastructure?
        Secretary McHale. In order to improve the Nation's communication
    infrastructure, the administration created the SAFECOM program, an
    initiative managed within the Department of Homeland Security, with the
    mission to help local, tribal, State, and Federal public safety
    agencies improve public safety response through more effective and
    efficient interoperable wireless communications. The program was
    designed specifically to coordinate the efforts of all Federal agencies
    in order to ensure that all levels of government will become
    interoperable. SAFECOM, at the invitation of my office, is working
    actively with major elements of the Department of Defense, including
    NORTHCOM, the National Guard Bureau, the Army Land Mobile Radio System,
    the Joint Tactical Radio System, and others. SAFECOM has also included
    my office in briefings and planning sessions and we have included
    SAFECOM personnel in appropriate strategic planning sessions.

        6. Senator Lieberman. Secretary McHale, are National Guard Bureau
    requirements being considered in any of these projects?
        Secretary McHale. The Director of the SAFECOM Program Office, in
    coordination with my Office, has met with the Chief of the National
    Guard Bureau and many of the State Adjutants General to develop
    coordinated interoperability strategies. My office further arranged for
    the SAFECOM Program Office to brief the Defense Science Board on two
    different occasions and has included SAFECOM in our Strategic Planning
    Guidance Study to ensure that opportunities for coordination are
    identified and undertaken.

                             intelligence analysis
        7. Senator Lieberman. General Eberhart, in your written testimony,
    you point out that NORTHCOM has established a Combined Intelligence and
    Fusion Center, which ``coordinates the acquisition, analysis and fusion
    of intelligence, counterintelligence and law enforcement information .
    . . and shares that information with organizations at the national,
    State, and local levels.'' As you describe it, the Fusion Center
    appears to overlap with other intelligence analysis units focused on
    homeland security. What is the relationship between the Combined
    Intelligence and Fusion Center at NORTHCOM with other intelligence
    analysis centers, specifically the Information Analysis and
    Infrastructure Protection Directorate at the DHS; the TTIC; the CTC at
    the CIA; and the intelligence analysis unit at the Federal Bureau of
    Investigation (FBI)?
        General Eberhart. The Combined Intelligence and Fusion Center
    collaborates with the analytic centers in Washington, DC, to develop
    and exchange products and to ensure threat intelligence and information
    is shared among the watch centers.

        8. Senator Lieberman. General Eberhart, what issues have you
    identified that relate to how these centers might complement, rather
    than compete with, one other, and how are they being addressed by the
    agencies involved?
        General Eberhart. We do not believe there is a problem with
    ``competing'' analysis from various centers. While they share
    intelligence and information, each agency has its own audience, views
    the threat based on its mission and reports the threat to its
    consumers.

        9. Senator Lieberman. General Eberhart, what is your center's
    relationship with State and local governments and local law enforcement
    and how are you cooperating with DHS in establishing these
    relationships?
        General Eberhart. We work with the DHS and the FBI to share
    information with State and local governments. We pass threat warning
    information to the FBI's National Joint Terrorism Task Force for
    subsequent relay to the Joint Terrorism Task Force in each State, as
    appropriate. In concert with the lead Federal agency, we coordinate
    directly with State-level Joint Terrorism Task Forces for special
    events that may involve DOD assets.

        10. Senator Lieberman. General Eberhart, does NORTHCOM maintain a
    list of suspected terrorists who might be operating inside or outside
    the U.S. and, if so, how is what you are doing related to the watch
    lists being consolidated by the Terrorist Screening Center?
        General Eberhart. NORTHCOM does not maintain lists of suspected
    terrorists who might be operating inside the United States. We do
    follow the movements and activities of known and suspected terrorists
    outside the United States via intelligence and law enforcement sources
    and methods to help ascertain if they have contacts or operatives in
    the continental United States, Canada, or Mexico.
        We are aware of the DHS's Terrorist Screening Center watch list;
    however, we do not participate in this law enforcement activity.

        11. Senator Lieberman. General Eberhart, does your intelligence
    center produce intelligence products that analyze the threat to our
    homeland? If so, how often are these products produced and with whom
    are they routinely shared?
        General Eberhart. Yes, we share intelligence products daily with
    the DHS, the FBI and the TTIC, as well as other agencies within the
    Intelligence Community.

                weapons of mass destruction civil support teams
        12. Senator Lieberman. Secretary McHale, the DOD is in the process
    of expanding the number of Weapons of Mass Destruction-Civil Support
    Teams (WMD-CSTs), comprised of Army and Air National Guard members. The
    CSTs are ``federally resourced, trained, and evaluated, but fall under
    the command and control of the State governors.'' On March 9, 2004, the
    DOD announced that 12 new CSTs would be funded, including one in my
    State of Connecticut--bringing to 44 the total that have been
    announced. However, the goal is to ensure that every State and
    territory has at least one of these teams in place. I also understand
    that some States, because of their size, may need more than one. When
    will the full complement of WMD-CSTs be in place?
        Secretary McHale. Congress appropriated funds for the establishment
    of 12 teams in fiscal year 2004. In August 2004, the President signed
    the Fiscal Year 2005 Defense Appropriations Act, which provided funds
    for 11 additional WMD-CSTs, thus meeting the requirement of Section
    1403 of Public Law 107-314 (Section 12310 of Title 10 United States
    Code (U.S.C.), which required WMD-CSTs in all 55 States and U.S.
    territories.

        13. Senator Lieberman. Secretary McHale, since the CSTs are under
    the command of governors, how will they be integrated into NORTHCOM's
    planning for response to WMD events?
        Secretary McHale. CSTs normally operate in Title 32 U.S.C. status
    (State control, Federal funding) under the command of the State
    Governor; NORTHCOM has no command and control relationship with the
    CSTs. In this status, NORTHCOM has no command and control relationship
    with the CSTs. However, given the possibility that CSTs under State
    command and control and Title 10 forces under NORTHCOM command and
    control will find themselves responding to a WMD event in the same
    area, there is a need for command relationships that enable unity of
    effort. Unity of effort, as defined by Joint Publication 3-0 ``Doctrine
    for Joint Operations,'' ``requires coordination and cooperation among
    all forces toward a commonly recognized objective, although they are
    not necessarily part of the same command structure.'' Unity of effort
    is paramount to best serving the needs of the Nation.
        Command relationship protocols are necessary to allow for the
    seamless unity of effort essential to successfully complete the task at
    hand. These relationships are also an inherent element of the NORTHCOM
    and Pacific Command (PACOM) exercise programs and a common focus of the
    Commanders, NORTHCOM and PACOM, the National Guard Bureau, and the
    State Adjutants General. For example, the Federal response to the
    tragic end of the Shuttle Columbia saw many Reserve component forces
    and resources operating under the integrating command and control of
    NORTHCOM.
        Alternatively, in the case of a catastrophic WMD event where the
    DOD support has been requested by civil authorities and approved by the
    Secretary of Defense, some CSTs could be Federalized and integrated
    into the overall response efforts of NORTHCOM in the continental United
    States, Alaska, Puerto Rico, and the U.S. Virgin Islands or PACOM in
    Hawaii or Guam.

        14. Senator Lieberman. Secretary McHale, what initiatives are
    underway to expand NORTHCOM's WMD response capabilities, and how do
    these capabilities relate to other national WMD response capabilities,
    such as the U.S. Department of Energy's (DOE) Nuclear Emergency Search
    Team (NEST)?
        Secretary McHale. When authorized by the Secretary of Defense,
    Joint Task Force Civil Support, headquartered in Norfolk, Virginia,
    Joint Task Force Consequence Management East, headquartered at Fort
    Gillem, Georgia, or Joint Task Force Consequence Management West,
    headquartered at Fort Sam Houston, Texas, under the command and control
    of NORTHCOM, would provide consequence management support to civil
    authorities.
        When needed, other existing assets such as the Marine Corps'
    Chemical, Biological Incident Response Force, the Army's Tech Escort
    Units, Chemical, Biological Rapid Response Teams, Domestic Response
    Causality Decontamination Units, or, when federalized, the National
    Guard WMD-CSTs can be also assigned to NORTHCOM to provide consequence
    management support to civil authorities.
        Additionally, the following initiatives contribute to improved DOD
    WMD consequence management capabilities that can be employed by
    NORTHCOM:

             Headquarters, Army Chemical, Biological, Radiological,
            Nuclear and High Yield Explosive (CBRNE) Command. The
            Department of the Army recently approved the creation of
            Headquarters, CBRNE Command. With an initial operational
            capability of fiscal year 2004, this headquarters will provide
            worldwide command and control of Army CBRNE response assets, to
            include the Army's Explosive Ordnance Disposal units and the
            Army's Technical Escort Units. Currently, the Army plans to
            place this organization under the command and control of U.S.
            Army Forces Command, with a strong supporting relationship to
            NORTHCOM.
             National Guard CBRNE Enhanced Response Force Package
            (NG CERFP): The National Guard Bureau is currently developing
            regional CBRNE response force packages. Their mission: on
            order, respond to a CBRNE incident and assist local, State, and
            Federal agencies in conducting consequence management by
            providing capabilities to conduct personnel decontamination,
            emergency medical services, casualty search and extraction and
            perimeter security. During a CBRNE event, the CERFP will work
            in coordination with Federal military forces under the command
            and control of NORTHCOM as part of the overall national
            response. If federalized for a mission in the NORTHCOM area of
            responsibility, the CERFP will likely be under the operational
            control of NORTHCOM.
             Project Guardian: To ensure DOD installation emergency
            preparedness for WMD events, Project Guardian will enhance the
            capabilities of 200 DOD installations (185 in CONUS, 15
            overseas). This program includes enhancements in CBRN
            detection, identification, and warning; protection;
            decontamination; CBRN information management; medical
            protection, surveillance and response; and emergency first
            responders; while simultaneously leveraging existing
            installation physical security, logistics, sustainment,
            maintenance, and command and control. As with other DOD
            resources employed in support of civil authorities after a
            CBRNE event, NORTHCOM would have operational control of the
            resources in their area of responsibility.

                               special operations
        15. Senator Lieberman. Secretary O'Connell, under existing budget
    authority, SOCOM has the ability to procure off-the-shelf equipment and
    manage/fund modification efforts to enhance current military hardware
    to meet the unique requirements of special operations troops. Is it
    your opinion that SOCOM currently has sufficient input into the
    requirements definition, planning, and acquisition of major defense
    programs?
        Secretary O'Connell. Yes, through close cooperation and
    collaboration with the military departments, SOCOM is able to provide
    significant input throughout the research, development, and acquisition
    process for major defense programs. Examples of Major Defense
    Acquisition Programs with significant SOCOM involvement include the
    following:

             Blackhawk Upgrade (UH-60M)--Utility Helicopter Upgrade
            Program
             CH-47F--Cargo Helicopter Upgrade Program
             ATIRCM/CMWS--Advanced Threat Infrared Countermeasures/
            Common Missile Warning System
             V-22 Osprey--Joint Advanced Vertical Lift Aircraft
             SSGN--Ohio Class Conversion
             SSN 774--Virginia Class Submarine
             ASDS--Advanced SEAL Delivery System
             C-130J--Hercules Cargo Aircraft
             C-130 AMP--C-130 Aircraft Avionics Modernization
            Program

        16. Senator Lieberman. Secretary O'Connell, on page 8 of your
    testimony, you cite that one effect of the global war on terrorism has
    been a significant increase in operational tempo for SOF. The DOD has
    added 3,700 additional personnel during the period fiscal years 2004-
    2009 for SOCOM. You stated that the increases are focused on fixed and
    rotary-wing aviation specialists, SEAL teams, civil affairs (CA),
    psychological operations (PSYOP), and Theater Special Operations
    Commands. Is there also a requirement for additional training of SOCOM
    linguists?
        Secretary O'Connell. Yes. SOCOM has both linguists and language-
    capable operators built into these 3,700 additional billets. SOCOM will
    gain 60 active component military intelligence linguists, 147 language
    capable CA specialists, and 154 language capable PSYOP specialists.
    Naval Special Warfare Command will gain 254 language capable SEALs and
    Special Warfare Combat Crewman (SWCC). All of these carry additional
    language training costs for SOCOM with the exception of the
    intelligence linguists which are provided by the Army. All of these 615
    billets have been validated at proficiency level 2/2/2.
        Overall, SOCOM's language program requires less than 10 percent of
    the Defense Foreign Language Program budget and trains 12,100 special
    operations personnel. The SOF proficiency level, currently 0+/0+, is
    being re-looked and will likely be validated at level 2/2/2 for four
    soldiers on each Special Forces Operational Detachment-A and level 1/1/
    1 for all other soldiers.

        17. Senator Lieberman. Secretary O'Connell, based in the expected
    future operational workload for SOCOM, do you foresee the need for even
    larger increases in your personnel?
        Secretary O'Connell. Yes. SOCOM will add 1,594 SOF personnel in
    fiscal year 2005. Additional growth is required over the next 5 years
    to increase capabilities in critical areas such as CA, PSYOP, U.S. Navy
    SEALs, SOF, and special operations aviation. These additions will
    enhance the Command's ability to prosecute the war on terrorism. As the
    war progresses we will continue to monitor the situation as special
    operations forces cannot be mass produced and our Reserve and active
    component mix requires careful balancing. With SOF personnel in high
    demand in the civilian sector, we are experiencing some loss of
    personnel that must also be carefully monitored. SOCOM will remain
    focused on personnel end strengths and will request additional growth
    when necessary to support the war on terrorism.

        18. Senator Lieberman. General Brown, what resources do you feel
    SOCOM forces require in the future to further improve their
    effectiveness as they continue world-wide operations in support of the
    global war on terrorism?
        General Brown. SOCOM continues to focus resources to address three
    critical challenges: planning and directing the global war on
    terrorism; preserving readiness of our SOF; and transforming SOF to
    more agile, adaptive, and responsive warriors. In terms of force
    structure, we will continually need to recruit, assess, train and
    develop more SOF. Congressional support of our fiscal year 2005 budget
    request at current levels is critical to sustaining our fiscal year
    2004 and fiscal year 2005 force structure increases. As indicated
    during the hearing, if we find any requirements for additional
    resources we will let you know.
                                     ______

                 Questions Submitted by Senator Daniel K. Akaka
                               hawaiian security
        19. Senator Akaka. General Eberhart, I understand you are
    responsible for all policies and programs involving the Air Force and
    Navy strategic nuclear forces in support of national security
    objectives. In your written statement, you say that NORTHCOM is working
    with other regional combatant commands to eliminate threats to our
    homeland from outside your area of responsibility. Could you provide
    information on what you are doing regarding the coordination between
    NORTHCOM and PACOM regarding national homeland security for Hawaii and
    the Pacific Island Territories?
        General Eberhart. NORTHCOM and PACOM have exchanged liaison
    officers who coordinate on issues impacting the commands--this
    arrangement is working well. In addition, planners from both commands
    regularly discuss our common mission. For operational issues, officers
    in our Domestic Warning Center contact PACOM's Joint Operations Center
    for events affecting Hawaii and the PACOM area of responsibility.
        As a point of clarification, please note NORTHCOM does not have
    responsibility for strategic nuclear forces; United States Strategic
    Command has that mission.

        20. Senator Akaka. Secretary McHale, your office has stated that
    good working relationships have been established with all homeland
    security players to include NORTHCOM, the DHS, and law enforcement
    agencies to help make the United States more secure. Hawaii is a unique
    State out in the Pacific as you are well aware. Since your confirmation
    last year, could you tell me what special needs of Hawaii were
    considered by your office when developing homeland security policy?
        Secretary McHale. Since my confirmation, I have ensured that we
    consider our homeland defense responsibilities in their fullest
    context. The PACOM and its responsibilities in Hawaii, as well as the
    Pacific territories of Guam, American Samoa, and the Commonwealth of
    the Northern Marianas Islands have been given equal consideration as
    the NORTHCOM and its responsibilities within the continental United
    States.
        I made a point of traveling to Hawaii early in my tenure, in May
    2003, to meet with our military commanders and officials of the state
    of Hawaii to gain a first hand impression of their views. One of my
    deputy assistant secretaries was a speaker at the Governor's Inaugural
    Asia-Pacific Homeland Security Summit last December and joined in the
    Emergency Response panel hosted by Hawaii state officials and the
    Hawaii National Guard.
        We have recognized the vital role that the Hawaii National Guard
    plays in both the defense of Hawaii and its emergency response
    capabilities to deal with natural and manmade disasters. Let me give
    you an example:
        Military mission success depends upon the readiness, reliability,
    and sustainability of our military forces. The successful training,
    equipping, deploying, and supporting of these forces is dependent upon
    critical supporting infrastructures, e.g., power, water,
    communications, transportation, etc. My office, in concert with Admiral
    Fargo's staff, recognized the interdependencies that exist between
    PACOM and its forces and  the State of Hawaii. Towards that end, PACOM
    and our Defense Program Office for Mission Assurance undertook a
    comprehensive study and analysis of Hawaii's critical infrastructure,
    in order to determine its vulnerabilities and potential single points
    of failure. This information is now the basis of planning between the
    command, the Hawaii National Guard, and the State's Emergency
    Management staff and directly contributes to our homeland defense and
    security preparedness as well as enhancing Hawaii's ability to deal
    with natural and man-made disasters. Furthermore, my Director of
    Critical Infrastructure visited Hawaii's Emergency Management
    Operations Center to ensure our efforts were synergized to meet the
    State's needs and was assured of their complete satisfaction.

        [Whereupon, at 12:26 p.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                            THURSDAY, APRIL 1, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

        UNIFIED AND REGIONAL COMMANDERS ON THEIR MILITARY STRATEGY AND
                            OPERATIONAL REQUIREMENTS

        The committee met, pursuant to notice, at 9:36 a.m. in room
    SD-106, Dirksen Senate Office Building, Senator John Warner
    (chairman) presiding.
        Committee members present: Senators Warner, Allard,
    Sessions, Ensign, Levin, Reed, Akaka, Bill Nelson, E. Benjamin
    Nelson, and Pryor.
        Committee staff member present: Judith A. Ansley, staff
    director.
        Majority staff members present: Charles W. Alsup,
    professional staff member; Gregory T. Kiley, professional staff
    member; Thomas L. MacKenzie, professional staff member; Paula
    J. Philbin, professional staff member; Lynn F. Rusten,
    professional staff member; and Diana G. Tabler, professional
    staff member.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; and Evelyn N. Farkas, professional
    staff member.
        Staff assistants present: Michael N. Berger, Sara R.
    Mareno, and Bridget E. Ward.
        Committee members' assistants present: Christopher J. Paul,
    assistant to Senator McCain; Arch Galloway II, assistant to
    Senator Sessions; D'Arcy Grisier, assistant to Senator Ensign;
    William K. Sutey, assistant to Senator Bill Nelson; and William
    Todd Houchins, assistant to Senator Dayton.

           OPENING STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner. Good morning, all. Thank you for
    weathering a rather difficult day to get here.
        We meet today to receive testimony from: Admiral Fargo,
    Commander of the Pacific Command (USPACOM); General Hill,
    Commander of the Southern Command (USSOUTHCOM); and General
    LaPorte, Commander, United States Forces in Korea (USFK). We
    welcome all of you this morning and thank you for finding the
    time to visit with some members of the committee prior to the
    hearing.
        This is the last in a series of hearings by this committee
    this year, conducted over the past few weeks, to receive
    testimony from our Nation's combatant commanders. Gentlemen,
    you are our warfighters. We welcome your insight on
    developments in your area of responsibility (AOR) as well as
    your assessment of the 2005 defense budget request.
        Each of you has a long and distinguished record of service
    to our Nation. I want to thank you, on behalf of the committee
    and indeed Congress, for your leadership, dedication, and
    service. We ask you to convey to the very fine men and women
    and their families under your commands the gratitude of this
    committee and indeed the Congress. The entire Nation, I think,
    is at an all-time high in supporting and recognizing their
    sacrifices, their professionalism, their dedication to the
    cause of freedom.
        I continue to view with great concern developments in the
    Korean Peninsula, particularly the developments relating to
    North Korea's ongoing nuclear program. Over the past year,
    North Korea has withdrawn from the Nuclear Nonproliferation
    Treaty and appears to have resumed reprocessing activities.
    Resumption of North Korea's nuclear weapons program poses a
    grave threat to the region and indeed to international
    stability.
        The United States, in conjunction with its allies and
    friends in that region, is working responsibly to try to
    resolve this situation through diplomatic means. Hopefully,
    this diplomatic approach will be successful.
        I look forward to hearing Admiral Fargo's and General
    LaPorte's assessments of the situation on the peninsula. I am
    particularly interested in any changes you have seen over the
    past year in North Korea's military posture as well as your
    assessment of North Korea's nuclear program, ballistic missile
    and proliferation activities--underline the ``proliferation
    activities,'' and the readiness of our forces to deter and, if
    necessary, to respond to any developments on the peninsula both
    now and in the future.
        Developments in China are always of concern to this
    committee. The recent election period in Taiwan was a period of
    increased tensions across the Taiwan Strait. We are interested
    in Admiral Fargo's views on the current China-Taiwan
    relationship and how concerned we should be about the potential
    for miscalculation in that situation. I would also appreciate
    an update on the U.S.-China military-to-military relationship
    and I commend you, Admiral, for taking a leadership position in
    this area.
        In the Asia-Pacific region, the global war on terrorism is
    being waged in Singapore, Malaysia, Thailand, the Philippines,
    Indonesia, and other nations. Through Operation Enduring
    Freedom (OEF)-Philippines, the U.S. military continues to
    provide training, advice, and assistance to the armed forces of
    the Philippines to improve their capability to deal with
    terrorist threats. I look forward to hearing your update on
    your efforts to counter numerous terrorist and transitional
    threats in your critical AOR, Admiral.
        As elsewhere in the world, it has been a busy year in
    USSOUTHCOM. Detainee operations at Guantanamo--my distinguished
    colleague Mr. Levin was down visiting a short time ago--
    political unrest in Haiti, and continuing efforts to assist the
    government of Colombia in its struggle with narcoterrorists are
    but a few of the many issues that General Hill has confronted
    over the past year.
        Recently the President of Colombia came up to visit with
    the leadership in the Senate and I was privileged to join in
    that important meeting. Of particular interest to the committee
    is the current situation, again, in Colombia. There are
    indications that the president of Colombia has made
    considerable progress in defeating the drug-funded terrorist
    insurgency in his country and that a modest increase in support
    from the U.S. could be decisive.
        We look forward to General Hill's assessment of this
    situation as well as the update on operations in Haiti and an
    overview of the challenges and priorities in this important
    region.
        The committee is very interested in the plans of the
    Department to restructure the basing of U.S. military forces
    worldwide. I ask all of you to comment on the global footprint
    and its impact on your respective AORs.
        Yesterday, Admiral, we had a particularly interesting
    discussion--Senator Levin joined us for a while--on the subject
    of how, understandably, so much of our attention is focused on
    the situation in Iraq and Afghanistan, but at the same time the
    threats primarily in your AOR cover the entire spectrum of
    types of challenges to the military. For example, fortunately
    there are no submarines involved in the conflicts that I have
    just enumerated, whereas there are some 250, you said,
    different types of submarines operated by different nations in
    your AOR. That is very significant.
        So we look forward to your testimony and I hope that you
    will touch on how, as we address these situations in Iraq and
    Afghanistan with tremendous efforts, we have to be mindful of
    the entire spectrum of threats worldwide.
        Senator Levin.

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman. Let me first join
    you in welcoming our three distinguished witnesses here this
    morning. We have asked each of these commanders to share with
    us a threat assessment in their AOR, a report on current
    military operations under their command, an assessment of how
    adequately the budget request for fiscal year 2005 and beyond
    meets their operational readiness and quality of life
    requirements.
        In Asia, we face on the Korean Peninsula the most serious
    nuclear crisis since 1994. In South and Southeast Asia, another
    breeding ground and AOR in the war on terrorism. In the Taiwan
    Straits, political-military tensions. On the South Asian
    continent, two nuclear rivals, India and Pakistan, in an uneasy
    truce.
        Last October, the North Koreans declared that they had
    repro-cessed all 8,000 plutonium fuel rods that had been canned
    and frozen for 7 years under the Agreed Framework from 1994 to
    2003. This came after North Korea had expelled the
    International Atomic Energy Agency inspectors, withdrawn from
    the Nonproliferation Treaty, and stated that it had restarted
    its 5-megawatt nuclear reactor. In January the North Koreans
    demonstrated to a U.S. delegation that they have removed the
    plutonium fuel rods from storage and that they have restarted
    their reactor.
        On March 2, Assistant Secretary of State for East Asian and
    Pacific Affairs James Kelly testified that it was, in his
    words, ``quite possible'' that North Korea had reprocessed all
    of the fuel. He subsequently told the media that the
    intelligence estimate had not changed and that, ``the operative
    phrase I use is `we do not know for sure.' ''
        According to a report released in January by the
    International Institute for Strategic Studies, if they
    processed all the fuel, the North Koreans could have as many as
    seven nuclear weapons. Meanwhile, the report adds, the 5-
    megawatt reactor could provide enough plutonium for about
    another bomb this year. By the end of 2004, we could be
    confronted with a situation where North Korea, in just the last
    year, has added six new nuclear weapons to its arsenal. If the
    North Koreans completed construction on two larger reactors,
    50- and 200-megawatts respectively, the picture could be
    exponentially worse.
        Meanwhile, the third round of talks in the last year
    concluded with only an agreement to establish working groups
    for technical discussions and a commitment to meet again before
    the end of June. The administration insists that the North
    Koreans must agree to a complete and verifiable and
    irreversible dismantlement of their nuclear weapons before we
    negotiate with them.
        The administration should also be putting forward a package
    that addresses North Korea's core demands. That does not mean
    meet all their demands. It means address their core demands,
    respond to them. The North Koreans appear to have used the last
    year and a half to further their nuclear ambitions. Serious
    negotiations are the only hope of ending their nuclear programs
    and potential nuclear proliferation.
        I hope that Admiral Fargo and General LaPorte can tell us
    more about their assessment of North Korea's nuclear, missile,
    and conventional capabilities, their drug-related activities,
    and the quality of our intelligence regarding North Korea.
        The North Korean threat derives some of its potentially
    deadliest features from the specter of proliferation to
    terrorists. The war on terrorism in Asia, the Western
    Hemisphere, and elsewhere is a race to neutralize the terrorist
    leaders and to prevent their replacement and new recruits to
    these networks of death.
        Secretary Rumsfeld reportedly asked, in an internal memo
    last October, the following: ``Are we capturing, killing, or
    deterring and dissuading more terrorists every day than the
    madrassas and the radical clerics are recruiting, training, and
    deploying against us?'' I hope that Admiral Fargo and General
    Hill will answer that question with respect to their respective
    AORs.
        In the Western Hemisphere, the threat comes primarily from
    narcoterrorists and from failing states. The work of our
    military in supporting the Colombian government's fight against
    narcoterrorists is bearing fruit as the government increases
    its control over its territory, captures or kills the top
    terrorist leaders, eradicates increase hectares of coca, and
    moves towards negotiations with the paramilitaries. Much
    remains to be done and most of it is hard political, economic
    work.
        I hope General Hill will also update us on the U.S.
    military involvement in Haiti, the prospects for restoring
    stability in that unfortunate country, and any plans for U.S.
    participation in the multinational force.
        Finally, I would note that the military operations in Iraq,
    Afghanistan, Haiti, the Horn of Africa, and elsewhere have put
    enormous strains on our military forces, both active and
    Reserve. As the chairman also requested, I would ask each of
    our witnesses to assess the impact of this high operational
    tempo (OPTEMPO) on the forces assigned to or earmarked for
    their area and the challenges that would result if conflict
    broke out in their AOR.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator Levin.
        Senator Reed, do you have a remark or two?
        Senator Reed. Just to welcome General LaPorte, Admiral
    Fargo, and General Hill and thank them for their service to the
    country. Thank you.
        Chairman Warner. Thank you.
        Admiral Fargo, please proceed. We will place into today's
    record your statements in their entirety.

    STATEMENT OF ADM THOMAS B. FARGO, USN, COMMANDER, UNITED STATES
                            PACIFIC COMMAND

        Admiral Fargo. Thank you. Mr. Chairman, Senator Levin, and
    distinguished members of the committee: Thank you for this
    opportunity to testify on the posture of the USPACOM. I have
    the honor to represent thousands of men and women, Active,
    Guard, Reserve, and civilians, and of course their family
    members, who are providing superior service to the Nation in
    the Asia-Pacific region and indeed around the world. Their high
    readiness and effectiveness can be directly attributed to the
    generous support of this esteemed body and of the American
    people as a whole.
        Today I would like to survey our primary security concerns
    in the region and then I look forward to answering your
    questions, and I appreciate your placing my statement into the
    record, Mr. Chairman.
        Dramatic events in Southwest Asia, for which the USPACOM
    continues to be a primary force provider, have not eclipsed the
    importance of the Asia-Pacific threats to global security, nor
    our attention to them. First and foremost, we are keenly
    focused on the Korean Peninsula. General LaPorte and I
    carefully monitor any indications of North Korean military
    readiness and, frankly, I do not think that war is any more
    likely today than it was 18 months or 24 months ago, but
    clearly the stakes would be very high if war occurred on the
    peninsula. Millions of South Koreans live within range of North
    Korea's artillery, and the stakes of course would be even
    higher if North Korea continues to pursue a nuclear capability.
        But North Korea's ability to threaten peace is not limited
    to the peninsula. The world's largest proliferator of ballistic
    missiles already has demonstrated the ability to deliver
    missile payloads beyond even Japan, and the reach of its
    illicit activities, such as narcotics, extends as far as
    Australia, as was demonstrated just last summer.
        Now, of course, North Korea's highly-enriched uranium
    program, along with its plutonium reprocessing program, raise
    the specter of nuclear weapons either in armed conflict or
    proliferated into the hands of terrorist groups--perhaps our
    biggest fear and one that clearly would threaten all nations.
    President Bush repeatedly has stated our commitment to a
    peaceful resolution of the North Korean nuclear issue. The
    diplomatic initiative is moving forward through the six-party
    talks and our role at USPACOM has been to ensure that diplomacy
    is backed by a viable military capability. We continue to do
    just that, posturing our forces not to provoke but to deter
    conflict.
        Next, we worry about miscalculation resulting in conflict
    between India and Pakistan or in the Taiwan Strait. Recent
    constructive dialogue between India and Pakistan and the
    relaxation in tensions are positive signs. The Taiwan Strait is
    another place where a miscalculation could result in terrible
    destruction and poses the possibility of expanding into a wider
    regional conflict.
        The Taiwan issue remains the largest friction point in the
    relationship between China and the United States. President
    Bush has stated our support for the one-China policy in the
    three communiques. It should be equally clear that our national
    leadership and USPACOM are prepared and committed to meet our
    obligations under the Taiwan Relations Act. We continue to
    watch closely the developments associated with the recent
    Taiwan election. To date we have seen no indication of imminent
    military crisis.
        Asia-Pacific nations face a number of transnational threats
    to regional stability, the most significant of which is
    terrorism. The war on terrorism is our highest priority at
    USPACOM. Regional and local terror groups with ties to al Qaeda
    continue to pose serious threats to U.S. and friendly
    interests, especially in Southeast Asia. This region is a
    crucial front on the war on terrorism. Destabilization of the
    governments of this region, which are moderate, secular, and
    legitimately elected, and with large Muslim populations, would
    result in decades of danger and chaos.
        The Jemaah Islamiyah (JI) directly targets the region for
    instability through terrorism, supporting its goal of a pan-
    Islamic state in Southeast Asia. The JI followed up its October
    2002 Bali bombing with a deadly attack on the J.W. Marriott
    Hotel in Jakarta just last August.
        I am pleased to report that the nations of the region are
    cooperating well against these threats. Singapore, Malaysia,
    Thailand, and the Philippines have thwarted a number of attacks
    and have detained or arrested almost 200 members of the JI.
    Indonesia, too, has been particularly effective in the arrest
    and prosecution of some 34 JI members who participated in the
    Bali bombing, most of whom have now been sentenced for their
    crimes. Australia, of course, plays an active role,
    facilitating bilateral counterterrorist efforts throughout the
    Pacific.
        But the JI is resilient and pervasive. Other key leaders
    remain at large and new terrorist generations are being
    trained. We are learning more about the degree of JI
    involvement in terror operations in southern Thailand and in
    the southern Philippines.
        It is against this backdrop of challenges that we reach my
    final priority, and that is transformation. Specifically, we
    call it operationalizing the Asia-Pacific defense strategy. We
    are examining new ways of commanding, supporting, and employing
    our forces. First we are updating our operational plans to
    incorporate not only our improvements in speed and precision
    and lethality and knowledge, but also the lessons learned from
    operations in Iraq and Afghanistan.
        Second, we are strengthening our command and control
    constructs to execute those plans responsively, leveraging
    joint and interagency arrangements. We are also working hard to
    develop expeditionary capabilities for immediate employment
    both in the Pacific and anywhere else they might be needed and
    to integrate those capabilities into new operating patterns and
    concepts.
        You have already provided us major improvements, like the
    Stryker armored vehicle and the C-17 aircraft, and you are well
    aware of two transformational efforts designed to improve our
    global force posture and footprint. Our global posture review
    aims to arrange our forces most effectively to assure friends
    and allies while deterring, and if necessary, defeating our
    adversaries. The Base Realignment and Closure (BRAC)
    Commission, scheduled for 2005, supports posture improvements
    by eliminating unneeded facilities and infrastructure that
    absorb dollars needed elsewhere.
        In sum, we are looking for ways to effectively array combat
    power as appropriate for uncertain threats of the future while
    reducing the burden we place on friends and allies in the
    region. Our goal is an enduring posture and footprint that
    demonstrates our commitment and is sustained for the long term.
    Finally, we are looking for access and logistic prepositioning
    opportunities throughout the theater that minimize lift
    requirements and increase responsiveness whenever and wherever
    we are threatened.
        You should all know, and I am sure you do, Mr. Chairman and
    members of the committee, that I am proud to represent the men
    and women of USPACOM. I sincerely thank you for the opportunity
    to testify today and I look forward to your questions.
        [The prepared statement of Admiral Fargo follows:]
                 Prepared Statement by ADM Thomas B. Fargo, USN
                                  introduction
        Mr. Chairman and members of the committee:
        On behalf of the men and women of USPACOM, I thank you for this
    opportunity to testify on the posture of our command, including an
    assessment of security in the Asia-Pacific region.
        Dramatic events of the past year in Southwest Asia, for which
    USPACOM has been a primary force provider, have not eclipsed the
    importance of Asia-Pacific threats to global security.
        First and foremost, we remain keenly focused on the Korean
    peninsula, where although I believe the likelihood of war is low, the
    stakes would be very high if war occurred--and even higher if North
    Korea continues to pursue nuclear weapons capabilities. Our role at
    PACOM has been to ensure diplomacy is backed by viable military
    capabilities. We continue to do so.
        Next, we are actively working to prevent miscalculation resulting
    in conflict between India and Pakistan or in the Taiwan Strait. Recent
    dialogue between India and Pakistan and the resulting relaxation in
    tensions are very positive signs. Our modest but constructive military-
    to-military relationship with China features high level exchanges like
    Defense Minister Cao's visit to Washington and Hawaii last year, and
    events that demonstrate the high quality of our forces, such as the
    recent port call of U.S.S. Blue Ridge in Shanghai. Meanwhile, Taiwan
    clearly remains the largest source of friction in our relationship with
    China. We remain prepared and committed to meet our obligations under
    the Taiwan Relations Act.
        Transnational threats are a continuing concern in the Pacific
    region. Despite recent and notable successes in the global war on
    terrorism, we remain deeply concerned about transnational terror
    organizations including al Qaeda and JI, and by more localized groups
    like the Abu Sayyaf Group (ASG) in the southern Philippines. We also
    sense increasing synergy between transnational threats like terrorism,
    illicit drugs, trafficking in humans, piracy, and especially the
    proliferation of Weapons of Mass Destruction (WMD). We have a number of
    creative initiatives ongoing to address these transnational concerns.
        It is against this backdrop of security challenges and
    opportunities that we reach my final primary concern--transformation.
    Responding to the new threat context, recent strategic guidance directs
    the global transformation effort. Our initiatives at USPACOM reflect
    that guidance and support the global effort, starting with updated
    plans and extending to resulting improvements in command and control,
    immediately available capabilities, and force posture. We are
    coordinating with our friends and allies in the region to effect
    enduring improvements while strengthening our ability to respond to
    emerging threats.
        Our relationships in the region, including five treaty allies and
    numerous friendships, are as strong as ever. I am gratified to report
    nations within our region are making smart and generous contributions
    to regional and global security, including support of OEF and Operation
    Iraqi Freedom (OIF). Since September 11, the region has demonstrated a
    heightened awareness of our interdependent vulnerabilities and the
    resulting necessity of cooperation for security. This mutually
    supportive environment facilitates both our forward presence in theater
    and the security programs necessary to promote a peaceful, stable, and
    prosperous Asia-Pacific region.
        This security context is reflected in our five top priorities at
    USPACOM. The following update on our defense posture is organized
    within those five priorities.
             sustaining and supporting the global war on terrorism
        Sustaining and supporting the global war on terrorism is our
    highest priority at USPACOM. In addition to addressing terror threats
    in the Pacific AOR, we are also a primary force provider to OEF and
    OIF.
        Nations of the region continue excellent cooperation against terror
    threats. Singapore, Malaysia, Thailand, Indonesia, and the Philippines
    have detained and arrested almost 200 members of the JI terror group.
    Thailand has both publicly articulated its terrorism concerns and taken
    aggressive steps to eliminate them. Despite significant domestic
    complications, Indonesia, too, has been particularly effective in the
    arrest and prosecution of 34 JI members who committed the October 2002
    bombing in Bali, 27 of whom have now been sentenced for their crimes.
        But regional and local terrorist groups with ties to the al Qaeda
    network continue to pose dangerous threats to U.S. and our friends,
    especially in Southeast Asia. Southeast Asia is a crucial front in the
    global war on terrorism. The destabilization of the governments of this
    region--moderate, secular, legitimately elected, with large Muslim
    populations--would sentence the region to decades of danger and chaos.
        The JI--an al Qaeda network affiliate--directly targets the region
    for instability, through terrorism, supporting its ultimate goal of a
    pan-Islamic state in Southeast Asia. The JI followed up its October
    2002 bombing in Bali with a deadly attack on the JW Marriott hotel in
    the heart of the Indonesian capital just last August.
        Several of the JI's key leaders are now in custody, including
    spiritual leader Abu Bakar Bashir and interim leader Abu Rusdan, who
    was recently convicted for his role in the Bali bombing. Most notable
    was the 2003 capture by Thai officials of terrorist Hambali, the JI's
    operational head and direct link to al Qaeda.
        But the JI is resilient and pervasive. Other key leaders remain at
    large, and new terrorist generations are being trained. We are learning
    more about the degree of JI involvement in terrorist operations in
    southern Thailand and the southern Philippines.
        The Philippines is a strong partner both globally and regionally in
    the global war on terrorism. President Gloria Macapagal-Arroyo recently
    identified the JI as her government's top terrorism priority.
        Of course the Philippines is coping with other terror threats as
    well, including the New People's Army and the ASG. Primarily a hostage-
    for-ransom enterprise, the ASG was responsible for the death of a U.S.
    Special Operations soldier in 2002, conducted several bombings in 2003,
    and most recently claimed responsibility for the bombing of an
    interisland ferry in late February. The Philippine Armed Forces (AFP)
    have improved their effectiveness against the ASG, highlighted by
    December's arrest of terrorist Galib Andang, aka ``Commander Robot'',
    on Jolo Island.
        We are concerned about JI influence in the activities of some of
    these indigenous terror groups, including sponsorship of bombings in
    Davao City last spring that left 38 people dead. We continue OEF--
    Philippines to provide training, advice, and assistance to the AFP to
    improve their capability and capacity to deal with terror threats.
        Philosophically, our approach to the terror threat has both near-
    term and long-term components. In the near term, we have to stop
    immediate threats against our citizens, our friends, property, and
    vital infrastructure--in short, we have to stop the violence. So this
    near-term effort includes defeating actual attacks, disrupting the
    enemy's plans, and proactive defensive measures. Clearly, we don't see
    military action as the sole or even primary instrument of national
    power in this fight--intelligence sharing and law enforcement lead much
    of this effort.
        These near-term efforts are an essential but incomplete solution
    because the global war on terrorism, like the fight against other
    transnational threats, cannot be won by attrition alone. Terrorists can
    multiply faster than they can be captured or killed.
        So our long-term effort is focused on strengthening the region's
    democratic institutions that provide security at the economic, social,
    and physical (i.e., education, law enforcement, basic services) levels.
    Many of our efforts, including the Theater Security Cooperation Program
    (TSCP) (discussed below) directly support this long-term goal. We
    believe we'll reach a tipping point in the global war on terrorism when
    sound governance prevails, and citizens value their institutions more
    than they fear the terrorists.
        Meanwhile, near term efforts include both proactive defenses and
    direct efforts to go on the offensive, if necessary, to capture or kill
    terrorists in the Pacific theater.
    Homeland Defense and Civil Support
        The USPACOM Homeland Defense AOR includes the State of Hawaii, the
    territories of Guam and American Samoa, and the Commonwealth of the
    Northern Mariana Islands, Federated States of Micronesia, Republic of
    the Marshall Islands, Republic of Palau, referred to as Compact States;
    and the following possessions: Wake Island, Midway Islands, Johnston
    Island, Baker Island, Howland Island, Palmyra Atoll, Kingman Reef, and
    associated territorial waters. We are leveraging our TSCP to build
    support and capabilities throughout the USPACOM AOR to support
    overarching homeland defense efforts. We are coordinating with U.S.
    Northern Command (USNORTHCOM) to ensure the same seamless strategy for
    defense in depth of the U.S. mainland.
        Our Strategic Concept Plan for Homeland Defense is in the final
    stages of coordination, but many aspects of the plan are already
    operational. All USPACOM service components contribute to the mission.
    Programs such as the Joint Rear Area Coordinators (JRAC), Critical
    Infrastructure Protection (CIP), Homeland Air Security, Consequence
    Management for Chemical, Biological, Radiological, Nuclear, and High-
    yield explosives (CBRNE), and Domestic Support Operations are just a
    few of the activities coordinated under the Homeland Defense Plan. We
    appreciate your continued support to ensure we have the resources
    necessary to continue these essential missions.
        USPACOM's Biological Warfare Countermeasures Initiative was
    established last year, leading Department of Defense (DOD) efforts to
    incorporate biological warfare mitigating measures into deliberate
    plans, coalition needs, and domestic interagency efforts. We are
    partnered with the Defense Threat Reduction Agency and Department of
    Homeland Security in this initiative.
        Civil Support (CS) is another key part of the overall Homeland
    Security effort. CS operations enhance our existing Domestic Support
    Operations to civil authorities. We have well-established relationships
    and mutual cooperation plans with these authorities and provide support
    as directed by the Secretary of Defense (SECDEF). Our Homeland Defense
    Plan addresses the full spectrum of CS responses from terrorist acts to
    natural disasters like recent typhoons in Guam. I support a
    standardized security clearance system that facilitates the immediate
    sharing of appropriate time-sensitive intelligence with local law
    enforcement and civil authorities.
        JRACs in Guam, Hawaii, Japan, and Korea (and Joint Task Force--
    Alaska) provide the command and control construct to synchronize our
    DOD antiterrorism/force protection (AT/FP) efforts for military
    installations and property with Federal, State, and local agencies and
    with host nations in the cases of Japan and Korea. Once again, we are
    coordinating our efforts and procedures with USNORTHCOM.
        USPACOM has an aggressive vulnerability assessment program for our
    DOD bases, ports, airfields, and training areas throughout the AOR. We
    use assessment teams from the Defense Threat Reduction Agency, the
    Services, and our components to ensure our facilities have updated
    assessments and proactive AT/FP plans. We also work closely with the
    State Department to ensure host-nation support is adequate to help
    protect our deployed forces using the latest AT/FP procedures.
        Theater and country specific Force Protection Conditions are
    continually reviewed and updated as necessary. Random Antiterrorism
    Measures are employed to complicate terrorist planning. USPACOM also
    employs a travel restriction program, providing a tool to declare
    entire countries or portions thereof ``off-limits'' to DOD members as
    necessary. In addition, FP plans are required for all travel in our
    AOR, from major unit deployments to individuals on leave. The resource
    commitment for increased FPCONs, however, presents a formidable
    challenge, both in terms of manpower and essential technologies. Your
    continued support to PACOM's FP objectives is necessary to sustain the
    progress we are making in this area.
        Our CIP Program assesses infrastructure upon which USPACOM depends
    for missions ranging from offensive combat operations to homeland
    defense. This broad-based program includes personnel, health
    operations, financial services, logistics, transportation, space,
    defense information, command, control, communications, intelligence,
    and public works sectors. We recently published the first CIP Appendix
    to one of our primary theater operational plans and fielded a CIP
    database that identifies relationships between mission-critical
    supporting assets, associated vulnerabilities, and protection
    requirements. Another building block is the development of our Theater
    Infrastructure Assurance Plan, which describes how we fundamentally
    conduct CIP throughout the AOR. Additionally, our bilateral CIP
    activities with friends and allies in the region have laid the
    groundwork to protect infrastructure outside the U.S. upon which we
    depend to fulfill our regional security obligations.
        The Combating Terrorism Readiness Initiatives Fund (CbT RIF)
    provides commanders additional resources to defend against emergent
    terrorist threats. USPACOM has received $9 million in CbT RIF funds in
    fiscal year 2004 and hopes to receive additional funds after completion
    of the second round of CbT RIF. The first submission of fiscal year
    2004 CbT RIF included 58 new and 20 revalidated projects from fiscal
    year 2003 totaling $26 million. Our fiscal year 2004 requests include a
    barrier wall for the Asia Pacific Center for Security Studies,
    hydraulic gates for the USPACOM headquarters, a Mobile Observation Post
    for Yokota airbase, and closed circuit TV and intrusion detection
    systems in Japan, Korea, and Camp Pendleton. Thank you for supporting
    this fund.
    Coordination with law enforcement
        We have established a model for theater counterintelligence
    operations by fusing DOD, law enforcement, and other government agency
    information, and incorporating allied contributions. DOD intelligence
    analysts embedded in the Federal Bureau of Investigation's (FBI) Joint
    Terrorism Task Force (JTTF)--Hawaii markedly enhance our ability to
    identify threats and gain insights into terrorist organization planning
    and operations. JTTF members participate in USPACOM planning for
    counterterrorist operations in the region while simultaneously
    supporting Homeland Defense efforts. The Patriot Act, which facilitates
    such interagency coordination, has enhanced our ability to share
    information on terrorist threats.
        Our Joint Interagency Coordination Group for Counterterrorism
    (JIACG-CT) is the USPACOM staff entity responsible for coordinating DOD
    and other government agency counterterrorism (CT) activities within the
    USPACOM AOR. Last year, the JIACG combined intelligence, operations,
    and training goals with interagency representation to produce our first
    theater CT Campaign Plan. This plan, aligned with Department of State
    goals embedded in embassy Mission Performance Plans, focuses on both
    near-term and long-term global war on terrorism efforts. These efforts
    include CT resource creation, terrorist identification and destruction,
    and the long-term effort to strengthen democratic institutions of
    governance. As the lead staff element in USPACOM's fight against
    transnational threats, the mission of JIACG-CT is being broadened to
    include coordination of our counterdrug and counterproliferation
    efforts.
        The Joint Interagency Task Force-West (JIATF-W) has long been
    USPACOM's premier operational counterdrug entity. Formerly based in
    California, JIATF-W is relocating to Hawaii to better confront the
    narcotic threat in the western Pacific. Its experience, assets, and
    interagency relationships will also be relevant against related
    transnational threats like narcoterrorism, piracy, human trafficking,
    and especially weapons proliferation. JIATF-W's interagency approach
    facilitates contributions of law enforcement, host nations, and Special
    Operations Forces.
    Regional Maritime Security Initiative (RMSI)
        The ungoverned littoral regions of Southeast Asia are fertile
    ground for exploitation by transnational threats like proliferation,
    terrorism, trafficking in humans or drugs, and piracy. The President's
    Proliferation Security Initiative (PSI) and State Department's Malacca
    Strait Initiative are designed to improve international cooperation
    against these threats.
        RMSI is USPACOM's effort to operationalize these initiatives.
    Fundamentally, we need to gain an awareness of the maritime domain to
    match the picture we have of our international airspace. Working first
    with other navies of the region, our approach is to assess and then
    provide detailed plans to build and synchronize interagency and
    international capacity to fight threats that use the maritime space to
    facilitate their illicit activity. Of course, there are other
    government agencies that play a key role here, too. We have found this
    concept well received by our friends and allies in the region.
        This is a large undertaking that requires us to harness available
    and emerging technologies to develop that maritime situational
    awareness. It also requires responsive decisionmaking architectures and
    the right kinds of immediately available, expeditionary forces to take
    action when the decision has been made to do so.
        Our long-term effort in the global war on terrorism focuses on
    strengthening democratic institutions to enhance governance and address
    the underlying problems that give rise to terrorist movements in the
    first place. This element includes civil-military education programs
    and especially our TSCP.
        Regional Defense Counterterrorism Fellowship (RDCTF) funds are a
    valuable tool in our efforts to combat terrorism in the Pacific.
    Through this flexible and responsive program, we've trained over 130
    students from 7 partner nations (Bangladesh, Indonesia, Malaysia,
    Nepal, Philippines, Sri Lanka, and Thailand) and are building a
    community of counterterrorism experts and practitioners who share a
    common perspective on the proper response to terror threats.
        International Military Education And Training (IMET) exposes future
    leaders to U.S. values, including commitment to the rule of law, the
    role of a professional military in a democratic society, and overall
    military professionalism. Grant funding has removed financial barriers
    to U.S. military education and training for friends and allies located
    in regions subject to untoward influences, and has contributed to the
    readiness of troops providing post-hostility engineering and
    peacekeeping support in Afghanistan and Iraq. Combined with training
    offered through the Foreign Military Sales process, IMET promotes U.S.
    military education and training as the recognized standard worldwide.
    Consequently, demand has surpassed supply as it relates to school
    capacity. Innovation has addressed this issue in the near-term but real
    capacity increases are necessary to build upon our success. I
    appreciate your support of this valuable program.
        Our TSCP is the vehicle through which we extend U.S. influence,
    develop access, and promote competence among potential coalition
    partners. These activities directly support the global war on terrorism
    and enhance readiness for contingency actions against emerging threats.
    We also coordinate the TSCP with the country teams in our embassies to
    ensure our efforts complement their Mission Performance Plans. TSCP
    activities clearly help strengthen institutions of governance, directly
    contributing to our long-term counterterrorism effort.
    improving readiness and joint warfighting capability of pacific command
                                     forces
        Improving the readiness and joint warfighting capability of USPACOM
    forces is critical to assuring our friends and allies, dissuading
    military competition, deterring threats against U.S. interests, and
    defeating an adversary if deterrence fails. This priority includes
    providing the spare parts, operating dollars, and training needed to
    maintain ready forces. It also means innovating, transforming, and
    improving those capabilities and technologies needed to keep our forces
    ready for a wide range of alternative futures.
        Past investments in readiness paid off in 2003. Approximately
    51,000 USPACOM active duty personnel have or are scheduled to deploy in
    support of operations in Afghanistan and Iraq. Pacific Fleet (USPACFLT)
    units deploying to OEF and OIF last year included the U.S.S. Abraham
    Lincoln, Carl Vinson, Constellation, Nimitz, and Kitty Hawk Carrier
    Strike Groups; independently deploying submarines; maritime patrol
    aircraft; Naval Mobile Construction and Explosive Ordnance Disposal
    Units, and a significant portion of our Reserve Force including Harbor
    Defense, Coastal Warfare, Mobile Inshore Undersea Warfare, and Inshore
    Boat Units. The Tarawa and Essex Amphibious Ready Groups deployed with
    the 15th and 31st Marine Expeditionary Units embarked. The seven-ship
    Amphibious Task Force West, built around amphibious assault ships Boxer
    and Bonhomme Richard deployed with the First Marine Division, and the
    year closed out with the initial deployment of Expeditionary Strike
    Group ONE with flagship U.S.S. Peleliu and the 13th MEU (Special
    Operations Capable) embarked.
        About 2,000 Pacific Air Forces personnel already have deployed to
    Southwest Asia supporting Aerospace Expeditionary Forces for OEF and
    OIF. Our Army Forces in the Pacific (USARPAC)--active, Reserve, and
    Guard--are also making important contributions in the U.S. Central
    Command (CENTCOM) AOR. An airborne task force from Alaska and an
    aviation maintenance unit from the Hawaii Army National Guard have been
    in Afghanistan for the past 6 months.
        More USARPAC contributions are in progress. The 25th Infantry
    Division (ID) headquarters and one Brigade Combat Team (BCT) are
    deploying to Afghanistan now, and another 25th ID BCT is currently
    serving in Northern Iraq. CH-47 aircraft of the Hawaii Army National
    Guard and the 411th Engineer Battalion (U.S. Army Reserve) are also en
    route to Iraq. The 1st Brigade of the 25th ID at Fort Lewis,
    Washington, now a Stryker BCT, will deploy to Iraq later this year,
    replacing the 3d Brigade of the 2d ID, also stationed at Fort Lewis. At
    the peak, approximately 16,500 USARPAC forces will be assigned to
    CENTCOM.
        In light of our impressive combat performance in Southwest Asia, it
    would be easy to conclude that our current programs are more than
    adequate to meet every conceivable threat. But even as we incorporate
    the lessons learned from those conflicts, and with great appreciation
    for the exceptional quality of our people and equipment, we also
    recognize that many of USPACOM's most demanding current and future
    warfighting challenges were simply not stressed in Southwest Asia.
    These missions include missile defense, undersea warfare, and air
    superiority.
    Missile Defense
        Cruise and ballistic missile threats are rapidly increasing in the
    USPACOM AOR. Our ability to defend against them is fundamental to
    homeland defense, regional peace and stability, and to successful
    execution of our contingency plans. We need an integrated, tiered
    missile defense system.
        Our Forward Deployed Naval Forces, Command and Control elements,
    and interceptor assets will be ready to support Missile Defense Initial
    Defensive Operations on or before October 1. We still need to increase
    the numbers of Patriot GEM and PAC-3 missiles ashore and develop a sea-
    based terminal missile defense capability. Sea-based systems reduce our
    overall footprint ashore while providing flexible, more secure options.
    I applaud your efforts to date, supporting development and fielding of
    our missile defense systems.
    Undersea Superiority
        USPACOM faces the greatest undersea warfare challenge in the world.
    Two hundred fifty submarines call the Pacific home--but only 30 percent
    of these submarines belong to allied nations. A robust and integrated
    Anti-Submarine Warfare (ASW) architecture, more capable force
    structure, and a committed investment in future technologies are
    essential to counter the growing submarine threat.
        Submarines remain the premier ASW asset. Our new Virginia class
    boats will meet our ASW needs well into the future, particularly in the
    challenging littoral environment. Congressional efforts last year also
    provided funding to refuel two additional 688 class submarines. To
    ensure sufficient submarines are available to counter future threats
    and defeat anti-access strategies, we must seriously consider funding
    the remaining refuelings of 688 class submarines and sustain an
    adequate Virginia class submarine build rate.
        Maritime Patrol Aircraft provide quick responding long range ASW
    and high demand intelligence, surveillance, and reconnaissance (ISR)
    capabilities. The P-3 Maritime Patrol Aircraft sustainment program and
    follow on multi-mission aircraft are critical to respond to emergent
    submarine threats. I also strongly support the acquisition of Automatic
    Periscope Detection technology for both surface ships and Maritime
    Patrol Aircraft employed in littoral regions.
    Air Superiority
        The F/A-22 Raptor will deliver quantum air power improvements with
    great relevance in the Pacific theater. Combining stealth, high speed,
    and precision weaponry, Raptor will buy back battlespace and increase
    warfighting options for the joint force commander. We need your support
    to fund and field this aircraft.
                   intelligence, surveillance, reconnaissance
    Signals Intelligence (SIGINT)
        The global war on terrorism and traditional military threats demand
    ever-increasing agility and innovation in intelligence. SIGINT remains
    critical to our requirements for timely threat information. Access to
    signals is challenging and requires a concentrated effort to expand
    collections capacity and increase technical capabilities to ensure we
    can adapt to changes in adversary Command and Control (C2) systems and
    processes.
        The National Security Agency and Service SIGINT capabilities are
    crucial to our counterterrorism efforts. The ability to integrate both
    national and tactical SIGINT is key to daily operations and the
    execution of deliberate and contingency plans. However, rapid advances
    in telecommunications technologies, and their use by our adversaries,
    are outpacing intelligence-gathering capabilities.
        I strongly support the NSA's transformation efforts to meet the
    challenges of the digital technology revolution. They must have the
    resources necessary to remain technically strong and provide
    capabilities to meet our requirements. NSA's capabilities against
    modernized militaries and transnational entities such as terrorists and
    weapon proliferators remain key to USPACOM objectives.
        Regarding tactical systems, I continue to advocate the accelerated
    development and fielding of joint, interoperable, modular, rapidly
    reconfigurable land, sea, and air SIGINT platforms. These improvements
    should be integrated into collaborative intelligence processing systems
    to make the best use of the increased data gathered.
        Without concurrent improvements in NSA's capabilities and in
    Service tactical cryptologic systems, it will be increasingly difficult
    to predict, find and target the most serious threats to U.S. national
    security interests.
    Human Intelligence (HUMINT)
        Improving our HUMINT collection capability against key USPACOM
    challenges, especially as it relates to hard and deeply buried C2, WMD
    facilities, proliferation, and terrorist activities is critical.
    Sustained resources for both CIA and DOD (Defense HUMINT Services) will
    yield the progress we need. Our military commanders must have insight
    into the plans and intentions of our potential adversaries--something
    that HUMINT is uniquely capable of providing.
    Cryptologic Linguists
        To be successful in counterterrorism we require linguists with a
    high degree of proficiency in many different languages and dialects.
    The minimum requirement is for 3/3 language capability; many targets
    require 4/4 (native) speakers. Maintaining a permanent cadre of
    cryptologic linguists with that degree of proficiency across a wide
    range of low-density languages and dialects is prohibitively expensive.
    So in addition to expanding training and recruiting initiatives, we
    must ensure the Defense Manpower Data Center's Automated Language
    Finder database tracks those personnel who are native speakers or who
    have acquired the requisite skills, and that the Defense Language
    Institute can test for those language skills.
    Imagery Intelligence (IMINT)
        The requirement for electro-optical, radar and infrared imagery
    remains crucial. IMINT converted into geospatial data and integrated
    with other source material is critical to the commanders in the field
    and provides much-needed context to decisionmakers.
    Unmanned Aerial Vehicles (UAV)
        The broad expanse of the USPACOM AOR and lack of access into denied
    areas make surveillance a significant challenge. We need a dynamic mix
    of national and airborne assets capable of maintaining access for IMINT
    and SIGINT coverage over target areas for extended periods. Persistent
    ISR assets greatly enhance our ability to perform counterproliferation
    and counternarcotics missions, combat piracy, and combat terrorism.
    Scientific and technical advancements like multispectral imaging aboard
    high altitude, high endurance assets such as the U-2 and Global Hawk
    UAV are ideally suited to support our requirements. Early fielding of
    Global Hawk in the USPACOM AOR is essential.
        Tactical level systems like the Predator UAV are also of great
    value in this theater. However, limited airframes, sensors, and
    dissemination systems prevent us from taking full advantage of these
    capabilities. This complementary arrangement of persistent surveillance
    using both theater and national systems is critical to ensuring
    sufficient warning and situational awareness.
    Tasking, Planning, Exploitation, and Dissemination (TPED)
        USPACOM requires a complete, joint TPED architecture to support
    future plans and contingencies. This architecture must accept inputs
    from a multitude of ISR assets and share this data freely among service
    Deployable Common Ground System (DCGS) nodes as well as intelligence
    users worldwide. Effective TPED of geospatial intelligence is crucial
    to providing the combatant commander, operational, and tactical forces
    with an incontrovertible view of the battlespace. Limited resources,
    coupled with great distances make interoperability among service DCGS
    nodes a critical element to accomplishing TPED and ISR missions within
    the theater.
         command, control, computer, communication (c\4\) improvements
    C\4\ Modernization
        We have made significant improvements in bandwidth availability
    through leases with commercial providers. We are on track with
    Satellite Communications Programs to replace failing satellites.
    Defense Information Systems Agency (DISA) assures bandwidth will be
    available whenever and wherever needed, at least to an installation's
    ``front door.''
        But we cannot deliver sufficient bandwidth from the front door of
    the installation to the warrior. The dated wires, cables, and switches
    installed on our bases have insufficient capacity to support
    applications and services that are based on the steady improvements in
    telecommunications technology. There is also a digital gap between
    strategic and tactical environments. Most tactical users rely on Radio
    Frequency (RF) links, but RF links can only deliver a fraction of same
    bandwidth available from landlines. As we greatly expand landline
    capacity through the Global Information Grid-Bandwidth Expansion, we
    must tailor applications for the bandwidth capacity that tactical users
    have available to perform their missions.
    Joint Information Capabilities Enhancement Environment (JICEE)
        True transformation involves changing the way we implement
    information systems from industrial-age, single-purpose systems, to
    information-age methods, wherein we define the framework of the entire
    information infrastructure then align programs-of-record to capability-
    areas within the framework.
        To move this transformation along, we need to develop a JICEE. This
    requires decomposition of existing programs, reassembling associated
    systems into a common networked environment. We've defined a framework,
    and with the support of the Command Information Superiority
    Architecture program, have partnered with U.S. Joint Forces Command
    (USJFCOM) to develop and test a model to capture existing programs and
    costs to illustrate their contribution to end-to-end capability for gap
    and duplication analysis. We intend to use JICEE to define the
    objective information and knowledge services network with the roadmap
    that shows how to integrate, interface, leverage and decompose when
    necessary, projects, initiatives and programs-of-record to get there.
    Combined Enterprise Regional Information Exchange System (CENTRIXS)
        CENTRIXS is the effort to establish permanent, classified coalition
    networks between U.S. and coalition partners. Today, CENTRIXS networks
    support maritime forces and shore planning staffs for escort and
    maritime interdiction missions for OEF and OIF. The communities of
    interest for CENTRIXS now include Australia, Canada, United Kingdom,
    United States, Japan, Thailand, the Republic of Korea, Singapore, and
    New Zealand. CENTRIXS provides e-mail, web access, chat and common
    operational picture capabilities with our coalition partners. With
    CENTRIXS we've made significant strides working with our allies to
    support the global war on terrorism and have planned extensive
    expansion of these networks for the near future. USPACOM is working in
    concert with other regional combatant commanders, USJFCOM, and the
    CENTRIXS Program Management Office toward a common network architecture
    that continues to support global joint operations.
    Agile Coalition Environment (ACE)
        Our ability to connect networks to, and share information with, our
    allies and security cooperation partners is a major challenge. The ACE
    effort is developing crypto devices agile enough to create virtual
    private networks to support bilateral and tailored multi-lateral
    relationships without having to build or lock-down unique networks for
    each community-of-interest security enclave. ACE enables CENTRIXS to
    converge from a set of independent networks to a single network that
    supports multiple security enclaves on an on-demand basis.
        Computer Network Defense (CND) is a major part of our comprehensive
    Information Assurance strategy. Our adversaries are constantly
    developing new ways to use computer vulnerabilities to deny access to
    or exploit our information resources. We need constant training on the
    latest tools, techniques, and vulnerabilities to sustain a highly
    trained team of CND professionals. This team maintains a strong
    relationship with the Joint Task Force for Computer Network Operations,
    the DISA Pacific Computer Emergency Response Team (CERT) and the DOD
    CERT to stay abreast on the latest information assurance advisories to
    maintain the tightest perimeter security possible.
        Deployable Joint Command and Control is critical to the success of
    future joint task force (JTF) operations across the operational
    spectrum from Non-Combatant Evacuation to high intensity warfare. This
    communications-enabling package has significant potential to strengthen
    command and control for the joint task force (JTF) by providing a rapid
    deployment capability, standardized C2 processes across the components,
    and standardized C\4\ systems from the strategic to operational levels.
    I am concerned, however, that DJC2 lacks organic mobility and the
    ability to interface anticipated C\4\ systems with our coalition
    partners. Both USJFCOM and the Office of the SECDEF (OSD) are working
    to resolve these issues, but these capabilities may require additional
    resources to ensure they are delivered on schedule in March 2005.
    Exercises
        Exercise events provide essential opportunities to hone a spectrum
    of security skills in multilateral settings, and are a key component of
    both our Joint Training Plan and TSCP.
        Exercises such as Cooperative Cope Thunder provide an opportunity
    for engagement in the Pacific Alaska Range Complex (PARC), a facility
    more than five times the size of the Red Flag range in Nevada. This
    year's Cope Thunder participants included: Australia, Bangladesh,
    Canada, Germany, India, Japan, Malaysia, Mongolia, the Philippines,
    Singapore, Sri Lanka, and the United Kingdom.
        Our Balikatan series in the Philippines is a critical element of
    our continuing effort to build an enduring CT capacity and capability
    in the armed forces of the Philippines. It also provides excellent
    training opportunities for U.S. forces, and does so in a manner that
    both exercises contingency access and relieves training pressures due
    to encroachment elsewhere in theater.
        Our premier multilateral exercise in the Pacific is Cobra Gold, an
    annual event hosted by Thailand. This exercise is specifically designed
    to promote capabilities and cooperation to deal with foreign
    consequence management, humanitarian assistance, peacekeeping/
    enforcement operations, noncombatant evacuation operations, and
    transnational threats like terrorism and illicit narcotics.
        Our Advanced Concept Technology Demonstration (ACTD) Program allows
    us to influence and leverage our Nation's investment in science and
    technology, expediting advanced technologies to our warfighters.
        Today USPACOM is sponsoring 18 ACTD projects--more than any other
    regional combatant command. We have distributed the workload across the
    whole theater--almost all service component and subunified commanders
    and most of my staff directors have responsibility for at least one
    ACTD. A number of our ACTDs have accelerated state-of-the-art
    technologies into OEF and OIF. For example, the Thermobaric Weapon ACTD
    accelerated its tunnel-penetrating-munition development for combat use
    in Afghanistan. The Language and Speech Exploitation Resources ACTD
    currently provides language translation support for intelligence
    collection and ongoing operations in both Afghanistan and Iraq. The
    Joint Explosive Ordnance Disposal ACTD has provided networked reachback
    support for hundreds of explosive ordnance events in Iraq and
    Afghanistan. In all, eight USPACOM ACTD projects are directly
    contributing to the global war on terrorism.
        We have been awarded three new ACTD Projects starting in fiscal
    year 2004. These include the Theater Effects Based Operations ACTD,
    which is a partnership with USFK and USJFCOM and has direct application
    in the work of our Standing Joint Force Headquarters.
                         training facilities and ranges
        Transformation of the PARC into a 21st century joint training
    complex and joint national training capability venue is important.
    Integrating virtual capabilities with existing training ranges is the
    next step in providing our warfighters the optimum combat training
    environment.
        USPACOM forces are performing an increasing number of missions
    ranging from major combat in OIF to humanitarian assistance. Mission
    success requires realistic training--something inert ordnance cannot
    completely provide. The first exposure to live fire faced by our forces
    must not come in a hostile combat environment, but rather in a
    controlled but authentic training environment where they can learn from
    their experiences and condition themselves to face the ``real thing.''
    We are integrating virtual training technologies with live facilities
    and exercises to maximize training value within existing physical
    restrictions.
        However, we are increasingly limited in our ability to conduct this
    training, because of restrictions on space, hours, ordnance, and radio
    frequencies. PACAF and U.S. Army Alaska work closely with State and
    Federal agencies to minimize range encroachment and to mitigate the
    environmental impacts associated with the PARC. Our primary live-fire
    range in the western Pacific, Farallon de Medinilla (FDM) is heavily
    used now only because we received legislative relief associated with
    the Migratory Bird Treaty Act.
        Training at Makua Range on Oahu is limited in the number and type
    of training cycles we can conduct, so more of our annual small unit
    training is achieved via deployment to the Pohakuloa range which also
    supports battalion level and higher combined arms live-fire exercises
    on the Island of Hawaii. We have also established a Joint Training
    Requirements Group to ensure effective use of available training areas
    in support of all service components and allies training in Hawaii and
    the Pacific AOR. This initiative will be fully integrated with the
    Joint National Training Capability through our new Pacific Warfighting
    Center. Finally, we are leveraging our TSCP to supplement our training
    locations as encroachment continues to restrict our training
    opportunities.
        Many military facilities are also becoming foci for biodiversity,
    with development and expansion encroaching on our facilities. Where
    once our bases and training areas were remote sites, urban expansion
    now surrounds them, forcing some species, including some endangered
    species, into relatively safer environments of military facilities.
        We are very good stewards of the environment. We have set aside
    space for protected species, altered or deferred some units' training
    to avoid interference in nesting areas, and developed specific programs
    to increase the populations of protected or endangered species.
        For the most part, the military's answer to encroachment challenges
    has been to work around the immediate problems while attempting to
    minimize the impact on the quality and quantity of training. For
    example, environmental concerns now impose noise restrictions that
    force important low altitude maneuvers to use unrealistically high
    altitudes and limit the use of ranges. Maneuver space is reduced,
    training lanes become narrow, and our individual maneuvers become too
    predictable or repetitive. The central question is how all these
    important interests can be advanced in a balanced and cooperative way.
        As part of our efforts to seek this balance, we sought and received
    narrowly focused clarifications to the Marine Mammal Protection Act and
    the Endangered Species Act that provide us the needed flexibility to
    train our forces for combat while continuing our commitment to
    environmental stewardship through necessary protection of marine
    mammals and endangered species.
        You also clarified the Endangered Species Act by specifying that
    Integrated Natural Resource Management Plans (INRMP) be used in lieu of
    designating critical habitat. DOD is already obligated under the Sikes
    Act to develop INRMPs for lands under military control. INRMPs are
    prepared in cooperation with the Fish and Wildlife Service and State
    agencies, which recommend ways for DOD to better provide for species
    conservation and recovery. While we understand there are attempts to
    roll back these new provisions, it is critical that we be given an
    opportunity to implement them on our military ranges and operating
    areas. We will use the increased flexibility to ensure that we have
    access to ranges and operating areas vital to training our forces for
    future conflicts. We appreciate your efforts to help us maintain our
    readiness while protecting the environment.
                             logistics and mobility
        We continue to improve our ability to adapt plans and rapidly flow
    forces and equipment. At the same time, we must efficiently sustain
    these forces as they move forward. Working in partnership with U.S.
    Transportation Command (USTRANSCOM), we have made steady progress
    identifying and prioritizing existing strategic air and sealift
    infrastructure improvement projects to support the global war on
    terrorism, or if required, a major theater war in the Pacific. Our
    Pacific Command En Route Infrastructure Steering Committee (PERISC)
    commissioned the study of several strategically located airfields in
    the theater, gathering appropriate infrastructure data and applying
    this information to model personnel and cargo throughput capability.
        Our current enroute airlift system includes Elmendorf Air Force
    Base (AFB) Alaska, Hickam AFB Hawaii, Andersen AFB Guam, and Japan's
    Iwakuni Marine Corp Air Station, Kadena Air Base (AB), Misawa AB, and
    Yokota AB. The PERISC has validated and championed over $100 million in
    fuel hydrant, ramp and runway projects at these locations to support
    the National Military Strategy and Mobility Requirements Study 2005. We
    also identified seven projects at Elemendorf AFB, Alaska and Hickam
    AFB, Hawaii in fiscal year 2005 to support the assignment of C-17
    aircraft at both locations. These and other investments throughout the
    AOR will ensure we have the required infrastructure readiness.
        Theater In-Transit Visibility is required to allow the Joint Force
    Commander to see force closure for deployments and avoid unnecessary
    costs and inefficiencies for sustainment and distribution. In the past,
    intransit visibility was typically provided to Joint Force Commanders
    from Ports of Embarkation (POE) to Ports of Debarkation (POD) (i.e. the
    USTRANSCOM air and sea channels). End-to-end visibility for either
    deployment or sustainment distribution prior to the POE, or in-theater
    from the POD to the ultimate destination did not exist.
        In October 2003, OSD published the first Department-wide Radio
    Frequency Identification (RFID) policy. Recently updated in February
    2004, this policy mandates the implementation and expansion of Active
    RFID. The immediate implementation of this policy will provide USPACOM
    with enablers for both In-Transit Visibility and Total Asset Visibility
    (TAV).
        USPACOM's current RFID infrastructure is limited and Army-centric,
    primarily supporting Army deployments to the Korean theater. To meet
    OSD's mandate and USPACOM's requirement for TAV, extensive RFID
    instrumentation must be obtained and installed in USPACOM.
    Instrumentation locations encompass our strategic and multi-nodal
    ports, including transload locations, and extend to supply activities
    and originating bases of deploying forces, ultimately including final
    destinations. To mirror CENTCOM's current capability for TAV in our
    theater, every effort should be made to fund and train personnel needed
    to activate this capability.
    Preferred munitions
        Emergent requirements in support of OEF and OIF resulted in reduced
    availability of preferred munitions and have forced us to rely on older
    stocks for a period of time. A robust near term inventory of global
    positioning system-aided and laser-guided bombs such as the Joint
    Direct Attack Munition, Wind Correct Munitions Dispensers and GBU-10/12
    pre-staged ashore, supplemented by more weapons available from afloat
    or deployable stockpiles would provide USPACOM with a more accurate,
    reliable capability. In the future, we'll also need significant
    quantities of emerging weaponry, such as Small Diameter Bomb and Joint
    Air to Surface Standoff Munition. Positioning these weapons forward in
    theater will reduce lift requirements in the early stages of a conflict
    when those assets are most critical.
    C-17 aircraft
        USPACOM strongly supports U.S. Air Force and USTRANSCOM efforts to
    procure at least 222 C-17 aircraft as the minimum baseline to ensure
    responsive global mobility and provide the flexibility and capacity to
    support DOD warfighting transformation. Our number one strategic lift
    shortfall is airlift due to retirement of aging C-141 aircraft, poor C-
    5 reliability. The C-17 is one of only two strategic airlift platforms
    in the Air Mobility Command inventory capable of providing over- and
    outsized cargo lift capacity. The only other aircraft is the less
    reliable C-5. The current Air Force Program Objective Memorandum funds
    180 C-17 aircraft, however, in light of increasing global war on
    terrorism demands, additional C-17 aircraft should be procured.
        USPACOM anticipates basing eight C-17s each at Hickam AFB, Hawaii
    in December 2005 and Elmendorf AFB, Alaska starting in 2007. Active
    duty Air Force and Air Reserve component forces--Hawaii Air National
    Guard and Alaskan Air Force reservists--will operate these strategic
    mobility aircraft. These aircraft will bring vastly increased
    reliability, versatility and large capacity to and through the Pacific
    theater.
        High Speed Vessels (HSV) provide a flexible alternative for
    intratheater movement in USPACOM, including its use to augment airlift.
    Since October 2001, III Marine Expeditionary Force (MEF) has been
    testing a leased HSV with great success and cost savings for exercise
    deployments and redeployments, as well as operational employment. Joint
    Venture HSV X1, the Joint Army/Navy HSV that participated in Millennium
    Challenge 2002 and other exercises, was scheduled to support U.S. Army
    training in the USPACOM Theater from March to April 2003, but was
    diverted to support CENTCOM for OEF and OIF. Without a doubt, HSV
    capabilities were critical to the early success of OIF. The speed and
    range of the HSV-X1 allowed it to rapidly deploy to CENTCOM. There, it
    was successfully employed as an afloat staging base for Naval Special
    Warfare combatant craft operations. In October 2003, a new HSV-X2
    Swift, replaced the HSV-X1, and is serving as a Mine Warfare Command
    and Support ship. In the USPACOM AOR, USARPAC will use HSV-X1 to
    conduct exercises and training under our ACTD program. We fully support
    continued leasing of tailorable High Speed Vessels as force projection
    and lift platforms.
    Tanker Aircraft
        Our National Security Strategy cannot be executed without air-
    refueling tankers, yet many of ours are nearly 50 years old. The
    average age of the fleet is 43 years, and the cost of keeping these
    aging aircraft mission capable is increasingly prohibitive. In the
    USPACOM, air-refueling tankers are critical to execution of theater war
    plans as early deployers in support of the Pacific Tanker Air Bridge.
    Meanwhile, OEF, OIF, and Operation Noble Eagle have demonstrated the
    operational impact air refueling capability has in support of the
    global war on terrorism. The KC-135 aircraft comprises 90 percent of
    the tanker fleet, and their usage has increased 45 percent over
    employment programmed before 11 Sept 01. The fiscal year 2002 DOD
    Appropriation Bill authorized the Air Force to negotiate the lease/
    purchase of 100 commercial B-767 aircraft for air refueling use--an
    issue currently under DODIG investigation. Regardless of the tanker
    lease resolution, we still need a viable option to replace the aging
    tanker fleet.
    Aircraft Mission Capable (MC) Rates
        We continue to be concerned about low USPACOM aircraft MC rates.
    Aging aircraft inventory and parts shortages continue to drive reduced
    MC rates, reduced fill rates for our ``go to war'' Readiness Spares
    Packages, and high cannibalization rates. Although funding for spare
    parts has 31 improved over the past several years, shortages still
    exist. As an example, only one of six PACAF A-10, F-15, and F-16 wings
    maintained minimum MC standards during fiscal year 2003. The F-15Cs at
    Kadena AB are, on average, 26 years old--11 years beyond the Air
    Force's maximum desirable age for fighter aircraft. We must
    recapitalize our fighter force structure.
               improving quality of service for our men and women
        Improved quality of service (QoS) for our men and women is our
    third priority. Inseparable from combat readiness, it is certainly more
    than just good quality of life. It also means providing the high
    quality operating facilities, the tools, and the information technology
    necessary for our personnel to achieve their goals and execute their
    missions with efficiency and a minimum of frustration. The QoS
    initiatives included in the National Defense Authorization Act for
    Fiscal Year 2004 demonstrate the commitment of military and
    congressional leadership to meet the needs of our deserving
    servicemembers and their families.
        Quality of life in USPACOM is good and improving. In the near term,
    we're focused on retention, operating tempo, and housing and school
    improvements.
    Competing for and retaining the best people
        We must not take current high retention rates for granted. High
    operating tempo associated with OEF and OIF, coupled with a recovering
    economy, could challenge our ability to retain quality personnel at
    required levels. A proactive approach featuring competitive
    compensation and thoughtful force management is required.
        On behalf of the men and women of USPACOM, thank you for your
    support of recent initiatives including: an average 4 percent pay
    raise, increases in allowances for family separation, housing, and cost
    of living, and pay premiums that recognize special sacrifices like
    Assignment Incentive Pay in Korea and Hostile Fire/Imminent Danger Pay.
    Deployed personnel in harm's way will also be more at ease knowing that
    additional family assistance has been provided in the form of child
    care, education, and youth services for their loved ones back home.
    These initiatives will help us recruit and retain our highly skilled
    troops and their families.
    Operating Tempo
        Our forces have performed magnificently during OEF and OIF. In
    2003, USPACOM's forwardbased forces largely remained in place during
    these conflicts to help maintain our deterrent posture. Air and naval
    forces that did participate were quickly returned to their home bases
    for rest, repair, and readiness for further assignment. As we enter
    2004, marines from the III MEF and soldiers from the 25th Infantry
    Division are beginning rotations to Afghanistan and Iraq. We will work
    to mitigate resulting impacts on these troops and their families while
    compensating with additional forces to maintain our readiness posture
    forward.
    Reserve Mobilization
        We continue to rely on our Reserve and Guard members to help us
    accomplish our missions in the Pacific. These outstanding citizen-
    servicemembers contribute hard work and unique talents. As a matter of
    policy, USPACOM relies heavily on volunteers. Since September 11, we
    have mobilized approximately 5,000 servicemembers who have served tours
    up to 2 years in length.
        Today there are about 40 mobilized reservists working at our
    headquarters and about 1,700 mobilized reservists throughout the
    USPACOM AOR, serving within the ranks of our service components. All of
    these members are making important contributions in key roles such as
    force protection, planning, logistics flow, and myriad other critical
    areas.
        We will continue to promote judicious use of our Reserve Forces. We
    actively support Secretary Rumsfeld's initiatives to relieve the
    pressure on the Guard and Reserve and to rebalance the force for the
    future. America can be proud of the way our Reserve Forces have
    responded to our Nation's needs.
    Force Health Protection
        We are working with OSD to ensure Smallpox and Anthrax Vaccines are
    authorized and will be available for those who need it. Last year, the
    emergence of Severe Acute Respiratory Syndrome (SARS) posed a new
    global threat. Although we didn't have a single case among our troops,
    we remain vigilant, and will take steps to limit our forces' exposure
    whenever possible. Another continuing threat in the Pacific is HIV/
    AIDS. We've partnered with select countries for HIV/AIDS Prevention
    Programs in their militaries--a significant step in fostering both
    healthy peacekeepers and economic stability.
        I also want to emphasize the need for integrated and standardized
    medical information systems across DOD. Unified Commands, among others,
    are responsible for reporting and tracking disease surveillance and
    vaccination data. However, no military wide automated systems exist to
    support these tasks. To this end, I support a USPACOM-led demonstration
    project to test and evaluate DOD's Theater Medical Information Program,
    currently under development, to integrate a joint medical information
    system, both in garrison and deployment.
    Military Housing
        Quality housing provides peace of mind for our forces and
    underscores our commitment to quality of life. Recent increases in
    basic allowance for housing support the DOD goal of zero out-of-pocket
    housing expenses by fiscal year 2005 for personnel living on the
    economy.
        Meanwhile, our service components remain committed to replace or
    renovate substandard military family housing, relying on housing
    privatization initiatives (such as Public Private Venture and
    Residential Communities Initiative) and Military Construction (MILCON).
    These initiatives are a ``win-win'' for the community and serve to
    provide high quality, welldesigned military housing developments.
    Pacific service components and USFK are in the process of adding or
    replacing over 1,200 family housing units in fiscal year 2004 alone.
    Your continued support of military housing privatization initiatives is
    appreciated. Still, MILCON is required to meet Defense Planning
    Guidance goals, especially overseas. In our fiscal year 2005 program,
    we have nearly $300 million in MILCON family housing projects.
        Continued funding is also essential to improve bachelor housing.
    For fiscal year 2005, $291 million is required to keep all components
    on plan. Navy, Air Force, and Marine components are on track to
    eliminate open bay and central latrine barracks. Army will meet this
    goal in Hawaii and South Korea by fiscal year 2008 and fiscal year
    2009, respectively.
    Schools
        Competitive schools are a top quality of life concern, especially
    in Guam and Hawaii. DOD Education Activity school projects in Guam will
    provide a new high school (fiscal year 2005 at $28 million) and a new
    elementary/middle school in the future.
        In Hawaii, we are leveraging our Joint Venture Education Forum
    (JVEF) to improve school quality, strengthen our partnership with the
    State and its citizens, and increase attractiveness of Hawaii as a duty
    station. The JVEF is a collaborative effort between the Hawaii
    Department of Education and USPACOM to improve education and facilities
    in the military impacted public schools. Over the past 4 years, the
    Forum has focused on repair and maintenance, and on upgrading textbooks
    and technology. More recently the JVEF has focused on the transition
    issues of military dependent children by helping schools develop
    transition assistance programs and offering a military culture course
    to school staffs. Subsequent USPACOM school surveys reveal
    significantly improved perceptions of Hawaii schools by military
    families.
    Transformation
        Improved QOS is an intended and essential product of our
    transformation initiatives. As we posture forces to ensure security in
    the new threat context, we also seek to place forces such that they can
    be efficiently employed against unpredictable threats--minimizing
    optempo while posing a minimal burden on friends and allies in the
    region. In short, we want to be relevant, welcomed, and immediately
    employable.
    Base facilities and infrastructure
        Sustainment, Restoration, and Modernization (SRM) of facilities and
    infrastructure throughout USPACOM remains an important concern. Current
    funding levels limit our ability to achieve the 67-year
    recapitalization rate directed by DOD. We have equally important
    infrastructure requirements above SRM needs, including environmental
    requirements and new mission bed-downs for transformational
    capabilities like C-17 aircraft and Stryker BCTs. We are working to
    ensure transformation-related changes are integrated into our MILCON
    plans to prevent wasted expenditures.
    Military Construction (MILCON) in Korea
        As Commander, U.S. Forces Korea is testifying, our facilities in
    Korea remain among the worst in USPACOM. MILCON is essential to rectify
    these shortcomings and to advance our transformation initiatives. We
    plan on consolidating USFK into two hubs of enduring installations--an
    air-oriented hub focused on Osan AB, and a sea-oriented hub in the
    southeast near Pusan. These consolidations will improve unit readiness,
    force protection, and quality of life while reducing adverse impact on
    our host nation. This long term but essential program requires stable
    MILCON funding.
        We appreciate your support for fiscal year 2004 projects in South
    Korea to upgrade hardened aircraft shelters and to construct family
    housing, barracks complexes and dormitories. We also understand your
    reservations about reprogramming MILCON projects before achieving the
    precondition of obtaining necessary land on which to construct them. We
    are working closely with the Republic of Korea (ROK) government to
    pursue the land purchases necessary to make these projects viable, and
    we will abide by the provisions of the 2004 Military Construction
    Appropriations Act regarding their planning and construction.
        We request your support for the fiscal year 2005 MILCON projects
    submitted by the services for South Korea, including U.S. Air Force
    family housing and dormitory projects and the sewer system upgrade at
    Camp Humphreys.
    Guam MILCON
        Guam's geostrategic importance cannot be overstated. Both Navy and
    Air Force facilities will continue to figure prominently in Guam's
    increasing role as a power projection hub. But Guam's environment can
    be harsh, and major infrastructure improvements are needed to support
    its further utility. USPACFLT plans to upgrade the KILO Wharf near
    Orote Point in fiscal year 2005 ($13 million) to better support weapons
    handling, and has further plans to develop the Orote peninsula into a
    fully capable munitions hub in the out years. Three future projects are
    also essential to improve wharves at Apra Harbor. In fiscal year 2005,
    USPACAF plans to construct a $20 million war reserve material storage
    facility at Andersen AFB, and has out year projects to repair the south
    runway and construct munitions storage igloos.
    Joint POW/MIA Accounting Command (JPAC)
        The JPAC stood up on 1 October 2003, combining assets of JTF--Full
    Accounting and Central Identification Lab-Hawaii (CILHI), with a global
    mission. The command will eventually be housed in a new combined
    facility at Hickam AFB that will improve efficiency while reducing
    overall footprint.
        In 2003, joint field activities in Vietnam, Laos, Burma, North
    Korea, and Cambodia recovered 26 possible human remains believed to be
    those of unaccounted-for Americans. Meanwhile, the CILHI identified a
    total of 64 Americans previously unaccounted for: 37 from the Vietnam
    War, 5 from the Korean War, and 22 from World War II. We remain fully
    committed to this mission.
    Pacific Warfighting Center (PWC)
        USPACOM's exercise simulation and support infrastructure is
    obsolete. This shortfall significantly reduces the ability to train
    USPACOM and JTF commanders in crisis action readiness procedures,
    limits their ability to rehearse key operational orders, and degrades
    the ability to improve combined interoperability with friends in the
    region. The current exercise simulation facility also does not support
    future technologies or meet force protection requirements. A planned,
    state-of-the-art operations and simulation center will improve total
    force readiness by exploiting emerging technologies to create a
    networked, live, virtual, and constructive training and mission
    rehearsal environment for joint and combined force commanders and their
    staffs.
        The PWC will be a key node on DOD's global grid of warfighting
    centers that create the Joint National Training Capability. PWC will be
    fully integrated with, and extend the capability of, USJFCOM's Joint
    Training Analysis and Simulation Center and U.S. European Command's
    Warrior Preparation Center. It will also be home to our most important
    new joint command and control development--the Standing Joint Force
    Headquarters, discussed below.
        PWC promises to save exercise funds and enhance regional security
    cooperation using Internet-based information exchange opportunities via
    the Asia-Pacific Area Network (APAN). We estimate a $30 million need in
    fiscal year 2006 for this facility.
    Nimitz-MacArthur Pacific Command Center (NMPCC)
        The NMPCC is complete and will be dedicated on April 14. This
    modern facility and its robust information technology will
    fundamentally change the way we command and control forces in the
    Pacific theater. We are working hard on information and knowledge
    management processes to maximize efficiency while minimizing
    frustrations. Thank you for making this important headquarters a
    reality.
               reinforcing the constants in asia-pacific security
        Our longstanding bilateral alliances in the Asia-Pacific region,
    our friendships both old and new, and the presence of our forward-
    deployed combat forces continue to be the foundation of the region's
    peace and stability. Based upon my extensive travels throughout Asia
    and the Pacific, it is clear that more and more nations appreciate the
    constructive role forward-based American forces play in regional peace
    and stability. We are capitalizing on these sentiments to build
    bilateral relationships while nurturing multinational efforts that
    support regional security needs.
        The USPACOM TSCP enhances U.S. influence, expands U.S. operational
    access to train (and deploy) forwarddeployed and forward-based combat
    forces, and increases competence of our coalition partners. Every TSCP
    activity is designed to enhance our joint/combined capabilities and
    communicate assurance to our friends while dissuading or deterring our
    enemies. Seminars and multilateral exercises continue to be inexpensive
    but powerful ways to develop the capabilities to work effectively as
    partners against all manner of transnational threats.
        TSCP is an engine of change that, along with our Joint Training and
    Experimentation plans, solidifies the link between national strategy
    and focused, enduring regional security.
        The dividends of a relevant, adaptive TSCP are clear--our treaty
    allies and friends have provided incomparable support to OEF, the
    global war on terrorism, and now OIF as well. We have new security
    partners. Mongolia, for example, has made historic contributions in the
    war on terrorism and in the reconstruction of Iraq. Many other
    countries within the Asia-Pacific region also share our security
    interests, and it is due in part to their efforts to combat terrorism
    that the analytical depth and breadth of shared actionable intelligence
    on the terror threat has improved so significantly. Their
    demonstrations of support are positive signs that meaningful regional
    cooperation on these threats will continue.
    Japan
        The U.S.-Japan alliance remains the most important pact in the
    Pacific and is as strong as it has ever been. Nearly 54,000 U.S. Armed
    Forces personnel are stationed in Japan, including units of the 5th Air
    Force, III MEF, and 7th Fleet. Without these forces, it would be very
    difficult to meet our commitments both to Japan and to the rest of
    Asia-Pacific region. Last year, Japan contributed about $4 billion just
    to host our forces--the most generous of any U.S. ally.
        Since becoming Prime Minister nearly 3 years ago, Prime Minister
    Koizumi has stressed the importance of the alliance and has exerted
    exceptional leadership in support of both regional and global security
    efforts. Japan acted swiftly and historically after September 11 to
    provide airlift services and over 89 million gallons of fuel to
    coalition ships in the Arabian Sea in support of OEF. Last year, the
    Government of Japan (GOJ) approved an extension to the basic plan to
    continue these valuable contributions to the global war on terrorism.
    Japan's Coast Guard also participated in the first PSI exercise last
    September.
        But arguably the most significant symbol of Japan's commitment to
    regional and global security was its December 2003 decision to
    contribute up to 1,000 Japan Self-Defense Force personnel for Iraq--a
    plan they are now implementing. Additionally, they've pledged $5
    billion in loans and grants for Iraqi reconstruction, second only to
    the United States. We take every opportunity to express our
    appreciation to the GOJ for Japan's incredible support.
        We continue to strengthen this vibrant alliance through open
    dialogue and a continuing infusion of creativity. We benefit from
    robust relationships with the Japan Self Defense Forces, all of which
    have greatly matured in the last two decades. Although our deepest ties
    lie with the Maritime and Air Self Defense forces--mainly due to the
    day-to-day presence of the 7th Fleet and 5th Air Force--we are also
    looking for ways to increase interactions with the Ground Self Defense
    Force.
        The Defense Policy Review Initiative (DPRI) provides an important
    forum for deliberating alliance improvements. Working closely with OSD,
    the State Department, and our country team, we are consulting with the
    GOJ on ways to improve our command structures, assist the Self Defense
    Forces in their own transformation efforts, and make modest adjustments
    to address noise and safety concerns in places like the Kanto plain and
    Okinawa.
        Efforts continue to implement the Special Action Committee Okinawa
    (SACO) final report. While 15 of 27 SACO initiatives have been
    completed, 12 are still being worked. Two of 5 noise reduction
    initiatives and 10 of 11 SACO land release initiatives have yet to be
    completed. Considerable progress on the 12 outstanding initiatives has
    been made, and the initiatives are continually being pursued.
        The cornerstone of the SACO final report is the Futenma Replacement
    Facility (FRF). GOJ approval of a basic plan for the offshore portion
    of the FRF highlights the progress made in the SACO process last
    summer. However, we continue to emphasize to the GOJ that a complete
    replacement facility as identified in the SACO final report--not just
    the offshore portion--is required before Futenma can be fully returned.
        We continue our frank and open dialogue with Japan to nurture this
    robust alliance. We will also continue to improve U.S.-Japan
    coordination with other countries in the region to address cooperation
    on regional security issues.
    Republic of Korea
        Our solid partnership with South Korea has contributed to peace and
    security on the peninsula for 50 years. Today, units of the 8th U.S.
    Army and 7th Air Force comprise the majority of our 38,000-troop
    strength in South Korea. We have also witnessed continued growth in the
    capability and capacity of ROK forces. They are modern, professional,
    and growing rapidly in tactical sophistication.
        Of course our partnership is focused on the most immediate security
    threat to the South Korean people--North Korea, or the Democratic
    People's Republic of Korea (DPRK). Although the likelihood of war on
    the peninsula remains low, the stakes posed by the North Korean
    conventional threat remain high, and are even higher if North Korea
    continues its pursuit of nuclear programs. The DPRK maintains more than
    70 percent of its forces within 100 kilometers of the Demilitarized
    Zone (DMZ), and the Kim regime persists in its ``military first''
    policy, keeping its large force fed, equipped, and trained while
    average citizens face deprivation and starvation.
        North Korean missile and missile technology exports pose a grave
    proliferation concern. Its missile inventory includes over 500 short-
    range SCUD missiles and medium range No Dong missiles capable of
    delivering conventional or chemical payloads well beyond the peninsula.
    Ongoing research on a multiple-stage variant of the Taepo Dong missile
    may provide North Korea the means to target the continental United
    States. Its other illicit activities, including probable State-run
    narcotics and currency counterfeiting enterprises, also pose a broad
    threat to regional security.
        After trilateral talks in April 2002 and two rounds of Six Party
    Talks to date, it is clear diplomacy must continue to be backed by a
    strong ROK-US defense partnership to eliminate North Korea's nuclear
    programs and reduce the North Korean conventional threat.
        We recognize the importance of reconciliation efforts to the Korean
    people and support those efforts by maintaining a position of mutual
    strength. Nations of the region are aligned on the goal of achieving
    complete, verifiable and irreversible dismantlement of the North Korean
    nuclear program.
        Meanwhile, the ROK has steadily increased its regional security
    role. USPACOM is working with the ROK Joint Staff to ensure our
    regional security cooperation efforts are in consonance with one
    another and integrated where appropriate. The return of Korean troops
    from United Nations (U.N.) peacekeeping duty in Timor-Leste in October
    2003 underscored Korea's commitment to regional peace and stability.
    The ROK continues to support USPACOM's Multinational Planning
    Augmentation Team (MPAT) program. South Korea's growing security role
    provides regional contributions while meeting its peninsular defense
    responsibilities.
        The ROK continues to support our global security efforts as well.
    In September 2003, we released the last of four ROK amphibious ships
    after their 18 months of logistical support and aircraft recovery
    operations related to OEF. In December 2003, the ROK Air Force
    completed 2 years of airlift support, having logged almost 3,000 flight
    hours and moved over 300 tons of cargo and passengers throughout the
    AOR. The ROK Army has deployed a Construction Engineer unit and medics
    to Bagram, Afghanistan since February 2003. By May 2003, over 600 ROK
    engineers and medical service personnel were working in Iraq along side
    the U.S. military.
        Most significantly, we anticipate the ROK government will dispatch
    up to 3,000 more troops to Iraq later this year, making it the third
    largest coalition troop contributor to OIF. These contributions have
    been, and will continue to be, important to global security, and we
    thank the Korean people for their support.
        Occasional anti-American sentiment reminds us that South Korea is a
    vibrant, democratic society, with a profusion of free and diverse
    voices. Nevertheless, we clearly have reached an important juncture in
    ROK-U.S. relations. While the majority of South Koreans support the
    alliance, we know we must strengthen the alliance to meet the
    challenges of the new international security environment.
        ROK Minister of Defense Lee Jun and U.S. SECDEF Donald Rumsfeld
    established the future of the ROK-U.S. Alliance Policy Initiative at
    the 34th Security Consultative Meeting in Washington D.C. on December
    5, 2002. Its charter is to develop options and make recommendations to
    adapt the alliance to reflect the changing regional and global security
    circumstances. The ultimate objective is to build a balanced and
    enduring alliance that will be more effective but less intrusive in the
    lives of the Korean people.
        Despite this challenging political environment, future of the
    alliance meetings have produced considerable progress. Most notable are
    the agreement to relocate U.S. forces from the Seoul metropolitan area,
    a more regional role for USFK, greater information sharing to
    coordinate force improvement plans, terms of reference for a command
    relations study, and the transfer of appropriate military missions to
    ROK forces. Final details to relocate U.S. forces from Seoul and
    consolidate U.S. forces into two hubs south of the Han River remain for
    ongoing ROK-U.S. discussions.
        Australia is a strong ally and special partner in the Pacific.
    Australia's support for a new joint antiterrorism center in Indonesia
    and its Regional Assistance Mission to the Solomon Islands are just two
    recent examples of Australia's solid leadership throughout Oceania. The
    Australian people have demonstrated a steadfast commitment to winning
    the global war on terrorism, and they continue to make valuable
    contributions to OEF and OIF.
        Improving the already high level of interoperability between U.S.
    forces and the Australian Defense Force remains a top priority. A
    comprehensive 2-year study on Strategic and Operational Level
    Interoperability has just concluded. The implementation of its
    recommendations will ensure interoperability continues to advance.
        Australia has the most robust set of range and training facilities
    for air, land and sea operations in the Pacific Rim. The facilities
    range from well-developed, instrumented training ranges to austere
    sites with little existing infrastructure. We have embarked on a
    comprehensive plan to study expanded use of these training areas to
    support the Talisman Saber exercise series and other future training
    initiatives. Future Australia/U.S. combined training events will
    exercise Combined Task Force-level air, land, and sea operations to a
    level rarely found outside the United States.
    Republic of the Philippines (RP)
        Designated a Major Non-North Atlantic Treaty Organization (NATO)
    Ally in October 2003, the RP is a strong partner in the global war on
    terrorism. Our bilateral relationship promotes mutually beneficial
    training, Philippine military reform, and increased counterterrorism
    capacity and capability. Despite significant domestic security
    concerns, the RP generously supported OEF with access to facilities and
    airspace, and recently deployed approximately 100 medical, engineering,
    and security personnel for Iraqi reconstruction.
        OEF-Philippines (OEF-P) continues. Last year, we executed a focused
    security assistance plan to support our CT objectives in the
    Philippines. Five security assistance modules enhanced near-term needs
    like light infantry training, night vision skills, and intelligence
    fusion. We also executed the region's most robust Foreign Military
    Financing (FMF) Maintenance Assistance Plan to improve the AFP tactical
    mobility on both land and sea. In February, a refurbished 180 patrol
    craft (ex-U.S.S. Cyclone) was provided to the RP under the Excess
    Defense Articles program. This vessel is now the most capable maritime
    interdiction platform in the Philippine Navy.
        The AFP have improved their effectiveness against the ASG,
    highlighted by December's arrest of ASG terrorist Galib Andang, aka
    ``Commander Robot'', on Jolo Island. We continue OEF-P to provide
    training, advice, and assistance to the AFP to improve their capability
    and capacity to deal with terror threats.
        Incremental progress toward our mutual defense goals has prompted a
    complete review of the pace and direction of the AFP as an institution.
    The resulting Joint Defense Assessment is both a template for long-term
    AFP reform and a mechanism by which we are managing near-term CT
    improvements.
        Philippine Defense Reform (PDR) is the engine by which these
    improvements will proceed. The PDR is a broad-based, multi-year
    cooperative effort between the Philippine and U.S. Governments. PDR
    recommendations, implemented in a coordinated and deliberate fashion,
    are designed to address systemic organizational deficiencies, correct
    root causes of strategic and operational shortcomings and achieve long
    term, sustainable institutional improvements in management, leadership
    and employment of the AFP. While we will assist the Philippines through
    normal security assistance processes and through routine military-to-
    military exchanges and exercises, the reforms are principally the
    responsibility of the Philippine Government. The Philippines' most
    senior military and civilian leaders are completely supportive of the
    PDR process. We appreciate your continued support of the Philippines
    through Security Assistance funding.
        Thailand also was granted Major Non-NATO Allied Status in December
    2003. Thailand's valuable contributions to regional security stem in
    large part from the capacity building we have mutually pursued.
        Since the October 2002 Bali bombings in Indonesia, Thailand has
    been particularly open and cooperative in the global war on terrorism,
    highlighted by the arrest on Thai soil of JI leader Hambali and other
    JI operatives. Thailand currently has about 450 engineers and medical
    personnel supporting Iraqi reconstruction, completed a significant
    engineering deployment to OEF in Afghanistan, and led military peace
    observers in Aceh, Indonesia, building on the Thai military's previous
    sustained peacekeeping effort in East Timor.
        Thailand routinely supports our access and training requirements
    and plays generous host to USPACOM's premier multilateral exercise,
    Cobra Gold. Cobra Gold 2004 will be our 23rd combined/joint bilateral
    exercise with the Royal Thai Armed Forces. Cobra Gold is our flagship
    vehicle for building regional competencies to respond to an expanding
    range of transnational security situations. By adding this
    multinational exercise dimension in an environment that trains for
    peacekeeping in addition to responding to transnational threats,
    Thailand assumes an active role in promoting South East Asia security
    and demonstrates capability as a regional leader.
        Singapore is emerging as a regional leader and eager contributor to
    Asia-Pacific security. Its aggressive approach to important issues
    ranging from SARS to counterterrorism to maritime security, coupled
    with its outspoken support for a strong U.S. presence in Southeast
    Asia, make this relationship among the most important in the Pacific
    theater.
        Our friendship with Singapore--more than just a friendship--has
    matured beyond expectations. Soon we will conclude a Strategic
    Framework Agreement, providing structure and organization to our
    bilateral efforts with sufficient flexibility to continue to mature
    along with our relationship. Together, we are exploring opportunities
    for expanded access to Singaporean facilities while increasing
    information and technology exchange.
    Malaysia
        Our relations with the Malaysian Armed Forces continue to weather
    periodic hurdles, most often characterized by opposition to U.S.
    policies in general and military operations in the global war on
    terrorism in particular. Despite the rhetoric, our military ties are
    cordial and cooperative, sharing information and best practices in
    maritime security and counterterrorism.
        Malaysia's influence extends beyond Southeast Asia. It currently
    holds the chairmanship of the Organization of Islamic Conference and
    the Non-Aligned Movement. Regionally, Malaysia is an influential
    leader, focused on the terror threat from JI. The recently inaugurated
    Regional Counterterrorism Training Center in Kuala Lumpur and combined
    Celebes Sea patrols with the Philippine Navy are but two examples of
    its willingness to contribute to regional security.
    India
        Our military-to-military program with India leads the larger
    bilateral relationship and is already providing security benefits in
    South and Southeast Asia. In the past year, mutual understanding has
    improved, exercise complexity has increased, and interest in foreign
    military sales has risen dramatically.
        All USPACOM components have conducted a number of successful
    training events with the Indian military, including the first-ever
    exercise between U.S. front line fighter jets and Su-30K Flankers.
    These events contribute to the combat effectiveness of U.S. forces.
        We have developed a long-range plan outlining mutually beneficial
    activities that build upon this momentum. These programs are designed
    to increase our proficiency and interoperability with Indian forces
    while addressing shared interests like maritime security. Our military
    cooperation directly contributes to the expansion of our strategic
    partnership with India.
        Indonesia is the world's most populous Muslim nation and third
    largest democracy. Sitting astride vital trade routes and targeted for
    destabilization by terrorists, Indonesia's success is crucial to peace
    in the Pacific. Its democratic development requires both effective CT
    efforts and Tentara Nasional Indonesia (TNI) professional reform.
        The government has effectively responded to the bombings in Bali
    and Jakarta, arresting and convicting many key participants and sharing
    information with its neighbors. We continue to assess opportunities to
    increase Indonesia's capacity and cooperation against the JI.
        The TNI is the most coherent government institution and will play a
    central role in shaping the future of the democracy. It is also an
    organization tainted by past human rights abuses, a lack of
    accountability, and corruption--conditions that led to restrictions on
    our military-to-military relationship. Indonesia now acquires non-
    western military hardware and training that is incompatible with our
    own. These conditions move Indonesia further away from the U.S. sphere
    of influence.
        The TNI appears committed to reform, and there is evidence of
    positive change in the military. To positively shape that reform, and
    working with our embassy country team in Jakarta, we have developed a
    plan of activities that meets all legal constraints. We will leverage
    electronic IMET, Regional Defense Counterterrorism Fellowships, and
    other authorized multilateral venues to expose Indonesian officials,
    including appropriate TNI officers, to non-lethal U.S. professional
    military standards.
        East Timor is hard at work developing the governing institutions
    and the political culture for enduring democracy. Though progress is
    being made, this is a long-term and daunting challenge. The country
    faces a weak economy, high youth unemployment, and low literacy levels.
        Our security goals for Timor-Leste are to support the development
    of a civil-military defense establishment that is fully subordinate to
    civilian authority and the rule of law, and to assist in the
    development of the 1,500-man Falantil-Force Defense Timor-Leste (F-
    FDTL) as a credible self-defense force. Our program is coordinated with
    Australia. IMET and FMF programs are being used to fund English
    language training, and Mobile Training Teams are being planned to
    provide education and training to support the development of civil/
    military defense capabilities. We are also conducting small unit
    exercises that enable USPACOM forces to train with the F-FDTL. This
    allows our forces to take advantage of the F-FDTL's jungle warfare
    experience in challenging mountainous terrain.
    China
        Our modest but constructive military-to-military relationship with
    China continues. Guided by Public Law 106-65 (National Defense
    Authorization Act of 2000), it is limited to non-warfighting venues
    such as high-level exchanges and Humanitarian Assistance/Disaster
    Relief cooperation.
        The last year has featured U.S. warship visits to Zhanjiang and
    Shanghai. The Chinese reciprocated with a two-ship visit to Guam in
    October. Late last year, USPACOM also hosted the Nanjing Military
    Region Commander, Lieutenant General Zhu Wenquan, and Defense Minister,
    General Cao. These exchanges communicate our values and demonstrate the
    high quality of our people.
    Taiwan
        Our relationship with Taiwan is guided by the Taiwan Relations Act
    of 1979. Taiwan's ability to defend itself remains the focus of our
    efforts, given added emphasis by the Chinese military buildup across
    the Strait. Our relationship supports development of a modern and joint
    military institution that promotes stability, democracy, and prosperity
    for Taiwan.
    Vietnam
        Our military-to-military relationship with Vietnam is progressing
    on a modest but positive vector. The Vietnamese Defense Minister's
    historic visit to Washington last year was followed in November by our
    first port call to Ho Chi Minh City since 1975. These events, combined
    with my visit to Vietnam in February 2004, represent straightforward
    but symbolic steps in our relationship.
        We share a number of security concerns with Vietnam. Of course, our
    most robust military-to-military program focuses on POW/MIA recovery.
    But there may also be room to cooperate in counternarcotics,
    counterterrorism, and peacekeeping. We hope the next year will benefit
    from Vietnam's new openness to build a relationship that looks to the
    future while respecting the past.
        Asia-Pacific Center For Security Studies (APCSS) continues to bring
    together current and future military and civilian leaders to discuss
    nonwarfighting security concerns in programs that promote our regional
    security cooperation objectives. Through its Executive Courses and
    Conference program, the APCSS provides Asia-Pacific leaders a premier
    venue to address security challenges from a multinational perspective.
    We are careful to include countries like Pakistan and Russia which,
    though not within USPACOM's AOR, clearly have security stakes in the
    Pacific. The Center is attracting the right people to reinforce U.S.
    policy, address relevant regional issues, and assure access to nations
    in the region. Congressionally appropriated RDCTF Program funding will
    be used to develop and conduct a semiannual course designed to
    facilitate comprehensive regional solutions in the fight against
    terrorism.
        Center of Excellence (COE), a USPACOM Direct Reporting Unit
    established by Congress in 1994, manages capacity building programs in
    peacekeeping, stability operations, HIV/AIDS mitigation for military
    forces, and disaster response and consequence management planning.
    These activities, typically conducted on a multilateral basis with
    current and potential coalition partners, reinforce relationships and
    develop confidence across the AOR. They also expand regional
    capabilities to support multinational coalition and peacekeeping
    operations around the world.
        Through its tailored education programs for U.S. force components,
    COE improves understanding of and relations with civilians active in
    complex contingencies, crisis transition, and peace support operations.
    For example, COE supports USARPAC's coordination of responses to CBRNE
    incidents at U.S. installations in Hawaii, Alaska, and across the AOR.
    I ask for your continued support of this important institution.
    Chiefs of Defense (CHOD) Conference
        One of our premier senior level theater security cooperation
    activities, USPACOM annually hosts this regional conference that brings
    together Asia-Pacific CHOD Chairmen of the Joint Chiefs of Staff
    (CJCS), equivalents for a series of discussions on regional defense
    issues of mutual interest. The October 2003 conference was held in
    Honolulu, with senior military leaders from 23 nations, including our
    CJCS, General Myers, in attendance. The conference theme, ``Security
    Transformation in the Asia-Pacific Region,'' provided an open forum for
    candid dialogue among the largest group of CHODs to participate since
    the conference's inception in 1998. The ``Transformation'' theme
    focused on three areas; Emerging Concepts for Maritime Security,
    Responding to Terrorism and Insurgencies, and Multilateral and Intra-
    governmental Operations. The CHOD's Conference continues to provide an
    excellent forum to foster understanding, build confidence, strengthen
    relationships, and promote stability. Next year, the conference will be
    co-hosted by the Japan Self Defense Force in Tokyo.
        Foreign Military Financing provides vital support to developing
    countries involved in combating terrorism and other transnational
    threats. Funds provided in the Foreign Operations, Export Financing and
    Related Appropriations Act, 2003 and the emergency FMF Supplemental
    directly supported security cooperation priorities throughout the AOR.
    FMF and Sales contributed directly to the successful prosecution of al
    Qaeda network-linked terrorists in the Philippines and met basic needs
    to improve the security environment in several other countries.
        USPACOM typically receives approximately 7 percent of the
    discretionary FMF funds. Legislative proposals to improve the security
    assistance process and add flexibility in the use of O&M funding have
    been submitted by my staff for your consideration.
        IMET continues to be an effective, low-cost component of the
    Security Assistance effort. The program provides U.S. access to and
    disproportionate influence with foreign governments. Furthermore, it
    exposes future leaders to U.S. values and commitment to the rule of
    law, the role of a professional military in a democratic society and
    promotes military professionalism. Grant funding has removed financial
    barriers to U.S. military education and training for friends and allies
    located in regions subject to untoward influences and contributed to
    the readiness of troops providing post-hostility engineering and
    peacekeeping support in Afghanistan and Iraq. Combined with training
    offered through the Foreign Military Sales process, IMET has supported
    the promotion of U.S. military education and training as the recognized
    standard worldwide. Consequently, demand has surpassed supply as it
    relates to school capacity. Innovation has addressed this issue in the
    near-term but real capacity increases are necessary to build upon our
    success. I appreciate your support of this valuable program.
        Acquisition Cross-Servicing Agreements (ACSA) or Mutual Logistic
    Support Agreement have enhanced interoperability, readiness, and
    provided a cost-effective mechanism for mutual logistics support for
    U.S. and allied forces supporting the war on terror. USPACOM forces
    that participated in fiscal year 2003 Bilateral/Multinational Exercises
    (Cobra Gold and Balikatan) were able to greatly reduce their logistics
    footprint by using ACSAs. Countries that deployed outside the AOR
    (Mongolia, the Philippines, South Korea and Thailand) in support of OEF
    and OIF have benefited significantly from these ACSAs as well.
        PACOM currently has 11 ACSAs in place (Australia, Philippines,
    South Korea, Japan, Singapore, Malaysia, Mongolia, Thailand, New
    Zealand, Fuji, and Tonga). Nine other countries are ACSA--eligible
    (India, Indonesia, Bangladesh, Nepal, Brunei, Maldives, Madagascar,
    Mauritius and Sri Lanka), and we anticipate completing three agreements
    in the very near future. Additionally, we are renegotiating Malaysia's
    ACSA (expires in March 2004) and just signed a revision to Japan's ACSA
    to make it more inclusive for support to the war on terror. Last year
    we finalized Mongolia's ACSA in May and renegotiated Thailand's in
    September.
    promoting change and improving our asia-pacific defense posture for the
                                     future
        Our top security concerns in the Pacific include the possibility of
    conflict on the Korean peninsula, miscalculation in places like Kashmir
    or the Taiwan Strait, and transnational threats like terrorism. These
    concerns--some longstanding and others just emerging--form only a
    subset of the global security challenges to which we and our partners
    must respond. This new threat context demands profound and enduring
    improvements in the way we command, equip, and employ our forces.
    Guidelines for these improvements have been clearly articulated by DOD.
        At Pacific Command, like all regional combatant commands, our job
    is to transform that guidance into action. Several principles direct
    our work.
        First and foremost, it is clear that our longstanding alliances,
    our strong friendships, and the forward presence of our combat forces
    will continue to form the foundation for our security posture in the
    Asia-Pacific region. This fact is reflected in the ``reinforcing the
    constants'' priority outlined earlier. Posture improvements and
    capability improvements, discussed below, are being developed in full
    consultation with our allies. Several mechanisms facilitate our
    dialogue, including the DPRI (Japan), Future of the Alliance Initiative
    (South Korea), Australia Ministerial/Military Representatives, Mutual
    Defense Board (Philippines) and the pending Strategic Framework
    Agreement with Singapore.
        Second, our posture improvements must meet both current and future
    threats. Each change we make is intended to enhance our capability to
    meet security commitments not just in the Pacific, but also around the
    world.
        While studying and incorporating the lessons learned from OEF and
    OIF, we also recognize that many of our warfighting challenges in the
    Pacific were not stressed in those conflicts. Missions like missile
    defense, anti-submarine warfare, and air combat figure prominently in
    many potential conflicts and must continue to be improved.
        Of course, clearly we recognize that just as our own capabilities
    have improved, so too have the military forces of our friends and
    allies. By incorporating these advances into our planning, we will
    improve the effectiveness of combined operations and reduce our
    reliance on forward based support functions.
        Finally, we intend these adjustments to be enduring--improvements
    that not only meet our mutual security needs over the long term but in
    doing so, ease the burden we pose on friends and allies in the region.
        With those principles in mind, USPACOM has developed a sixelement
    construct within which to organize our initiatives. We call it,
    ``Operationalizing the Asia-Pacific Defense Strategy.''
               operationalizing the asia pacific defense strategy
    Updating Plans
        Our plans and our planning process are being updated to reflect the
    new threat context. Essentially every plan is being revised to support
    the 4-2-1 force planning construct while addressing both state- and
    non-state threats. This construct calls for regionally tailored forces,
    forward stationed and deployed in four primary areas of the globe to
    assure our allies and friends and deter potential aggressors. If
    deterrence fails, our forces must be able to swiftly defeat the efforts
    of two aggressors and, if the President so directs, decisively defeat
    one of those two enemies. In the process, we are incorporating
    improvements in our capabilities--speed, precision, and lethality--
    while taking into account advancements in the capabilities of friends
    and allies. Lessons learned from OEF and OIF also inform the process.
        The revision process is being accelerated, and resulting plans
    feature inherent flexibility. In short, we recognize that success
    against emerging threats requires us to sense, decide, and act inside
    the enemy's timelines.
        We're also integrating the resources of relevant government
    agencies into our day-to-day planning and operations. Our inclusion of
    diplomatic, economic, and public diplomacy efforts reflects the fact
    that there simply aren't any strictly military solutions to today's
    security challenges.
    Strengthening Command And Control
        Benefiting from habitual command relationships, and using common
    tactics, techniques, and procedures, the synergy offered by joint
    command arrangements provides the speed of command necessary to
    successfully meet future threats.
        Our evolving command and control constructs benefit from
    interagency relationships. The JIACG-CT and JRAC mentioned earlier are
    two examples of joint staff elements that support combatant command and
    joint task force efforts. The expanding mission of the JIATF-W
    demonstrates the great facility of interagency integration.
    Standing Joint Force Headquarters
        Last year, PACOM stood up and exercised its first Standing Joint
    Force Headquarters (SJFHQ). In its current configuration, the SJFHQ
    rapidly augments a Joint Task Force command element to accelerate its
    readiness for action. When not specifically tasked, core SJFHQ staff
    plan and train to prepare for a variety of contingencies.
        My vision for the SJFHQ is to have a habitually trained
    organization that reduces long lead times routinely experienced in
    standing up Joint Task Forces. This organization will be trained on
    cutting edge planning and communication processes, tools and equipment
    in order to rapidly deploy and immediately facilitate command and
    control. The SJFHQ needs to be supported with adequate manning. Our
    SJFHQ is currently manned with 22 permanent and 36 augmented personnel.
    As we go forward in developing the SJFHQ (and its processes) for the
    Pacific, we are working closely with USJFCOM, which has been assigned
    overall responsibility for SJFHQ operating procedures.
        We have also developed several concepts and tools to facilitate
    coalition contributions to regional security efforts. Our MPAT program
    is one such initiative that has enjoyed great success. MPAT is designed
    to facilitate the rapid and effective establishment and/or augmentation
    of multinational coalition task force headquarters.
        One of the first products of the MPAT program was a Multinational
    Force Standing Operating Procedure (MNF SOP). These procedures
    standardize processes, promote cooperation, increased dialogue, and
    provide baseline concepts of operation for coalition task force
    efforts. They also serve as a centerpiece for multinational workshops,
    seminars and exercises aimed at improving coalition interoperability
    and operational readiness within the region. The MNF SOPs support the
    Secretary's Transformation Plan and have been shared with USJFCOM to
    support their coalition transformation efforts. Developed by the
    combined efforts of 30 MPAT nations, the procedures are truly a
    multinational initiative.
        Multinational participation in the MPAT program is robust, with 31
    nations participating to date. Participation is not limited to Asia-
    Pacific nations. Canada, France, Germany and the United Kingdom have
    also supported MPAT program events and the development of multinational
    force standing operating procedures.
        Currently, programs to support coalition building are financed by
    headquarters O&M funds. Additional funding marked specifically for
    multinational transformation efforts would greatly improve the Unified
    Commander's ability to improve ongoing efforts and develop new
    transformation efforts.
        As we strengthen ties with multinational and coalition partners,
    USPACOM continues to develop restricted-access and secure Internet
    opportunities with programs such as CENTRIXS and APAN. Protection of
    our coalition networks with information assurance technologies is a key
    component of our experimentation and transformation effort. We're also
    transforming our capability to communicate with coalition partners
    using machine language translation through a variety of text, voice,
    and pictorial translators.
        The ability to place instructional material on the APAN to provide
    Internet-based training and Advanced Distributed Learning would benefit
    our Asia-Pacific partners and support our TSCP. We could more
    effectively use focused military education programs to develop regional
    skills required to accomplish cooperative security missions, improve
    civil-military relations, increase respect for human rights, and
    strengthen democratic principles. For this reason, legislative
    initiatives have been drafted aimed at amending law to allow for the
    SECDEF, after consultation with the Secretary of State, to authorize
    the combatant commander to provide traditional and Internet-based
    education and non-lethal training to military and civilian government
    personnel of friendly foreign nations.
        Partnering with USJFCOM on a joint fires initiative, USPACOM has
    integrated leading-edge time-sensitive targeting technology into joint
    operations across the strategic and operational force levels. Over the
    next 2 years, with your help, we envision extending our joint fires
    capabilities to the tactical level through a mix of fires and common
    picture technologies, such as Joint Task Force Wide Area Relay Network
    (JTF WARNET) and FORCEnet. We've already reduced the targeting cycle
    from hours to minutes by improving cross-component collaboration and
    targeting efficiencies, but there's still room to improve. The end
    result will be a more seamless battle space with coordinated fires and
    reduced risk of fratricide.
        We are increasing our capabilities for immediate employment,
    emphasizing expeditionary combat power. Each of these capabilities has
    been evaluated to ensure support for regional contingency plans while
    meeting global requirements. Missile defense has already been
    discussed.
    Stryker Armored Vehicle
        The Stryker armored vehicle combines adaptability, firepower, and
    high technology in an expeditionary package. Lifted by C-17 aircraft or
    High Speed Vessels, Strykers have great relevance throughout the
    theater and are currently proving themselves under combat conditions in
    Iraq, demonstrating a readiness rate that exceeds current requirements.
    We look forward to the future Stryker brigades in Hawaii and Alaska.
    F/A-22 Raptor
        We need your support to fund and field the F/A-22 Raptor in the
    USPACOM AOR. The transformational capabilities of this remarkable
    aircraft will have enduring relevance for our warfighting needs, and
    promise to directly enhance both warfighting effectiveness and war plan
    options in the near future.
    Nuclear-Powered Cruise Missile Attack Submarines (SSGN)
        The conversion of four Trident class submarines to cruise missile/
    Special Operations Force (SOF) carriers has particular appeal in the
    Pacific, where our most demanding potential warfights and the
    continuing threat of terrorism converge. We appreciate your far-sighted
    support of this important platform.
    New Operating Patterns And Concepts
        These immediately employable forces are in turn integrated into
    operating patterns and concepts that satisfy both peacetime and wartime
    requirements. For example, the Navy's first Expeditionary Strike Group
    recently completed a very successful deployment to Southwest Asia and
    the western Pacific. Tailored air packages, based and launched from
    such maritime platforms, can satisfy a variety of missions ranging from
    non-combatant evacuation to maritime interdiction. This concept is
    particularly adaptable in joint and combined settings.
        As yet another example, we routinely deploy bomber elements to
    Guam, demonstrating both the responsiveness and flexibility of the U.S.
    Air Force and America's ability to respond quickly to any crisis in the
    AOR.
    Improving Force Posture And Footprint
        Changes in the global security environment provide both the
    opportunity and the necessity to improve our force posture, positioning
    forces where they have the greatest warfighting relevance while
    reducing irritants to host nation citizens. We are considering a number
    of posture improvements--each of them a response to new threats,
    updated plans, and increased capabilities of allied and friendly
    forces.
        This element of our transformation strategy is underwritten by five
    primary assumptions. First, our network of alliances and partnerships
    in the Pacific region is a strategic asset for the Nation--it will not
    be undermined. We also know that our posture must allow us to deal with
    uncertainty--because in the future, we probably won't fight from our
    current positions. Of course, we are designing posture adjustments to
    facilitate employment of forces both within and across combatant
    command regions. Fourth, the immediately employable forces discussed
    above argue for forward force presence. In short, we're not looking to
    move combat power back toward the U.S. mainland. Finally, technological
    advances allow us to focus on capabilities, as numbers no longer
    reflect actual combat power.
        We are well aware of the domestic and international political
    sensitivities associated with these changes. We also appreciate the
    complexity these changes add both to the upcoming BRAC process in 2005
    and to our continuing MILCON programs. We will keep our friends,
    allies, and Congress informed.
    Diversifying Access And Enroute Logistics
        Finally we want to diversify contingency access opportunities in
    the Pacific region. Increasing our access options improves training
    opportunities, contributes to theater security cooperation objectives
    and, most important, provides warfighting flexibility when we need it
    most. We are looking at a number of Cooperative Security Locations
    throughout the Pacific--``places'' rather than ``bases'' that meet
    these goals.
                               summary statement
        In USPACOM, our dedicated men and women, both in and out of
    uniform, continue to operationalize our Nation's strategic guidance,
    assuring our allies, dissuading our adversaries and deterring
    aggression. The combined talents and energies of our region's friends
    and allies continue to promote peace and prosperity in the Asia-Pacific
    region. We are fully committed--in every conceivable way--to winning
    the war against terrorism. Meanwhile, we are maintaining a ready and
    viable fighting force capable of decisively defeating any adversary,
    all the while mindful that our personnel, our friends, and allies and
    our progressive transformation efforts will continue to improve our
    Asia-Pacific defense posture for the future.
        Our finest citizens wear the cloth of the Nation. They have never
    doubted nor failed to appreciate your advocacy. On behalf of the men
    and women of U.S. Pacific Command, thank you for your support, and
    thank you for this opportunity to testify on our defense posture.

        Chairman Warner. Thank you for a very good statement,
    Admiral. We are very proud of you and your distinguished career
    of service to this Nation.
        Admiral Fargo. Thank you.
        Chairman Warner. You fulfill your role with a great deal of
    enthusiasm and wisdom. Thank you.
        Admiral Fargo. Thank you, sir.
        Chairman Warner. We will now listen to General LaPorte.

       STATEMENT OF GEN LEON J. LaPORTE, USA, COMMANDER, UNITED
     NATIONS COMMAND AND REPUBLIC OF KOREA/UNITED STATES COMBINED
      FORCES COMMAND, AND COMMANDER, UNITED STATES FORCES KOREA;
      ACCOMPANIED BY MAJ. GEN. TIMOTHY DONOVAN, USMC, C-5, UNITED
                          STATES FORCES KOREA

        General LaPorte. Senator Warner, Senator Levin, and
    distinguished committee members: I am honored to appear before
    the committee to update you on the current situation in the
    ROK. I want to extend the thanks of all the soldiers, sailors,
    airmen, marines, and DOD civilians who serve in Korea. Your
    unwavering support provides these dedicated men and women with
    the resources to maintain the readiness that underpins
    peninsula security and regional stability. You can be
    justifiably proud of your servicemembers and DOD civilians
    serving in Korea.
        The security and stability of the Northeast Asia region is
    a long-term interest of the United States. Along with our
    allies and friends, we continue to deter threats to security,
    promote freedom, and contribute to regional prosperity. The
    presence of the United States forces in Northeast Asia
    signifies our enduring commitment to these goals.
        The ROK has long been a key U.S. regional ally and leading
    democracy in Northeast Asia. In the ROK, democratic processes
    continue to govern the nation, demonstrated by the peaceful
    constitutional processes being used to address allegations
    against President Roh.
        The ROK-U.S. military alliance exemplifies cooperation
    among democratic nations to promote shared enduring interests.
    Our alliance remains steadfastly committed to the fundamental
    purpose, to deter and defend against North Korean threats and
    to strengthen mutual commitment to regional security and
    stability. The combined forces of the ROK and the U.S. remain
    trained and ready to accomplish its security missions.
        In addition to its predominant role in peninsula defense,
    the ROK has demonstrated a sustained commitment to coalition
    operations in Afghanistan and Iraq. Since 2002, the ROK has
    contributed up to 500 rotational medical and engineer troops to
    Afghanistan and the ROK Air Force and Navy have flown and
    sailed in support of the United States forces engaged in the
    war on terrorism. Last year the ROK deployed a 675-person
    contingent for stability operations and pledged $260 million
    for reconstruction in Iraq.
        This past February, the national assembly approved the
    dispatch of up to 3,000 additional troops to Iraq. When this
    contingent deploys, the ROK will have the third largest troop
    contingent in support of the Iraqi coalition.
        On the Korean peninsula, the combined forces of the ROK and
    the United States alliance are transforming, guided by the
    enhanced, shape, and align construct which synchronizes our
    efforts and ensures that the ROK-U.S. alliance remains relevant
    to the security needs of both nations. Together we are working
    to enhance our combined military capabilities to bring state-
    of-the-art military technologies and operational concepts to
    the Korean theater, strengthening our combined peninsula and
    regional deterrence and readiness.
        These enhancements include improved armored vehicles, air
    defense systems, chemical and biological defense, and advanced
    precision weapons. Advanced concept technology demonstrations
    programs such as Theater Effects-Based Ops, Tactical Missile
    System Penetrator, and Joint Blue Force Situation Awareness
    have demonstrated promising ways to enhance the capabilities of
    U.S. forces based in Korea. We also will continue to improve
    individual protective equipment, including Interceptor body
    armor and chemical protective equipment.
        United States forces continue to demonstrate the ability to
    rapidly reinforce the Korean peninsula with advanced
    capabilities, such as the C-17 aircraft, deploying Stryker-
    equipped Army units, and high-speed vessels moving MEFs to the
    peninsula.
        We have begun to shape the combined forces by transferring
    military missions from the United States forces to the ROK
    forces. These changes acknowledge the growing capabilities of
    the ROK military in its predominant role in peninsula defense
    while maintaining the firm United States commitment to
    peninsula security and regional stability.
        We continue to align the United States forces into two hubs
    of enduring installations that support an enduring United
    States military presence in the ROK. Consolidating and
    realigning United States forces, including the Second Infantry
    Division and units stationed in the Seoul metropolitan area,
    will increase our operational capabilities while improving
    readiness and quality of life for United States servicemembers.
    These enduring hubs, coupled with the prepositioned equipment,
    provide the strategic flexibility to rapidly reinforce the
    Korean peninsula and to promptly respond to regional security
    concerns.
        The realignment of the Second Infantry Division, begun
    under the 2003 land partnership plan, is a major component of
    transforming the USFK to meet future security requirements. The
    realignment of the Second Infantry Division depends on stable
    funding to existing projects in the future years defense plan.
        We are concluding negotiations to relocate the United
    States forces from Seoul. The Yongsan relocation, done at the
    request and the expense of the ROK government, will enhance the
    operational readiness of the alliance, improve facilities and
    quality of life for the United States forces, and return
    valuable land to the Korean people. With your continued
    support, transformation of the USFK will result in a more
    capable and sustainable U.S. military presence in Korea and
    produce a stronger military alliance.
        Improving community relations and quality of life remain
    top priorities in Korea. Our good neighbor programs,
    implemented at all command levels, continue to promote positive
    community relations with our Korean hosts. These programs, such
    as English language tutoring, cooperative humanitarian and
    conservation projects, and local Korean-American friendship
    associations, build mutual understanding and cultural
    appreciation.
        Service member quality of life in Korea is trending upward.
    With your support, we continue to improve the operational
    facilities, housing, and community support facilities through
    renovation and construction. These improved facilities along
    with incentives such as increased family separation pay, cost
    of living allowances, and assignment incentive pay have
    increased retention in Korea.
        On behalf of those serving in Korea, I want to thank you
    for your continuing support for these key initiatives and
    directly addressing the substandard living and working
    conditions, thus improving the quality of life in Korea.
        USFK shares your concern about sexual assaults involving
    servicemembers. The command treats sexual misconduct in any
    form as a serious matter and we are taking stringent measures
    to address the issue. We have charged leaders at all levels
    with personal responsibility for rigorously enforcing policies
    and establishing a working group to identify ways to eliminate
    risk factors that may contribute to sexual assault.
        Equally important, we have reinvigorated our educational
    programs, stressing risk factor awareness, prevention, and
    compassionate victim care. This is clearly a leadership issue
    and the leadership in Korea is engaged.
        I thank you for the opportunity to appear before this
    committee and look forward to your questions. Thank you.
        [The prepared statement of General LaPorte follows:]
                 Prepared Statement by GEN Leon J. LaPorte, USA
        Mr. Chairman and distinguished members of the committee, I am
    honored to again appear before you as Commander, United Nations
    Command; Commander, Republic of Korea-United States Combined Forces
    Command; and Commander, United States Forces Korea. On behalf of the
    more than 37,500 soldiers, sailors, airmen, marines, and 5,700 DOD
    civilians serving in Korea, I thank you for your unwavering support
    which enables us to maintain readiness and accomplish our deterrence
    mission on the Korean peninsula. I appreciate this opportunity to
    present my assessment of the command and our implementation plan for
    continued military transformation of the ROK-U.S. Alliance.
        Much has changed in the more than half century of the ROK-U.S.
    Alliance, and the pace of change has quickened since the events of
    September 11, 2001, violently demonstrated that the world security
    would be governed by a new paradigm. A new generation of young South
    Koreans, cognizant of their national achievements and aspiring to a
    larger role in international affairs, is now assuming leadership of the
    ROK. Last year, North Korea posed renewed threats to global security by
    acknowledging its pursuit of nuclear weapons, and withdrawal from the
    Nuclear Nonproliferation Treaty and other related international
    agreements. At the same time, the United States' security
    responsibilities, and our interdependence with allies and coalition
    partners, have grown throughout the world.
        While the dynamics of the security environment have changed and our
    security relationships continue to mature, the fundamental purpose of
    the ROK-U.S. Alliance remains unwavering: deter and defend against the
    North Korean threat; and mutual commitment to regional security and
    stability. Together, we continue to steadfastly oppose North Korea's
    renewed efforts to divide the Alliance and threaten peaceful nations.
    We are engaged in a detailed policy dialogue for the military
    transformation of the ROK-U.S. Alliance over the next few years. This
    transformation plan includes momentous changes for an enduring United
    States military presence in Korea and a stronger alliance. This
    military transformation will bolster the U.N. Command and the ROK-U.S.
    Combined Forces Command, the guarantors of regional security and
    stability.
        Today, I will address the importance of continued stability and
    security in Northeast Asia, the North Korean threats to the region and
    the world, the changes in South Korean society, the ROK's contributions
    to global and regional security, and the progress toward strengthening
    the alliance through ``Enhance, Shape, and Align'' initiatives.
    Finally, I will outline areas needing your sustained investment for the
    future of United States Forces based in Korea and the ROK-U.S.
    Alliance.
                    the northeast asia security environment
        The United States has significant, long-term interests in the
    Northeast Asia region. These interests include economic cooperation and
    interdependence, mitigating threats to regional stability, and
    fulfilling our commitments to allies and friends. Economic
    interdependence is a result of improved information technologies and
    transportation networks that speed the flow of capital, goods, and
    services around the globe. United States trade with the People's
    Republic of China, Russia, Japan, Taiwan, and the ROK approaches one
    fourth of our total international trade, exceeding our trade with the
    European Union, and is second only to the United States trade within
    the North American Free Trade Agreement. Bilateral ROK-U.S. trade
    exceeded $59 billion last year, and United States--Japan trade was over
    $155 billion. In addition to bilateral trade, United States direct
    investment in the larger Northeast Asia approached $100 billion in
    2003. United States trade with, and investment in, the region is
    substantial and projected to continue growing in the near term.
        Even with the trends toward economic cooperation and
    interdependence, well documented historical enmity and a tenuous
    balance of power remain potential sources of instability. The Northeast
    Asia region is the crossroads of five of the world's six largest
    militaries and three of the world's declared nuclear powers.\1\ There
    has been an upward trend in regional military expenditures over the
    last decade, with the regional average budget for force improvement
    increasing 15 percent, while the global average declined by 35 percent.
    North Korea's efforts to strengthen its military, in light of its
    bellicose rhetoric and history of provocation, remain the most
    substantial threat to regional peace.
    ---------------------------------------------------------------------------
        \1\ The world's six largest militaries, measured by personnel
    strength, are: The People's Republic of China, United States, India,
    North Korea, Russia, and the Republic of Korea. The declared nuclear
    powers under the Nuclear Nonproliferation Treaty (NPT) are: United
    States, Russia, China, France, and Britain. India and Pakistan are
    considered self-declared nuclear powers, acknowledged to possess
    nuclear weapons, but not signatories of the NPT.
    ---------------------------------------------------------------------------
        The longstanding presence of United States Forces and the strength
    of our strategic partnerships are the foundation of regional stability
    that is the catalyst for continued cooperation and prosperity. Forward-
    deployed United States Forces demonstrate our resolve to strengthen and
    expand alliances, eliminate threats from WMD, work with partners and
    friends to defuse regional conflicts, and stand with our partners to
    oppose threats to freedom wherever they arise. Robust United States
    Forces based in Korea, along with the ROK and other regional partners,
    continue to deter an increasingly manipulative North Korea.
            north korean challenges to regional and global security
        North Korea poses a variety of threats to regional and global
    stability. Its leader, Kim Jong Il, shows little regard for the welfare
    of ordinary citizens, and uses brutal internal security measures to
    ensure that no internal challenge to his regime emerges. He maintains
    large conventional and SOF. He sustains an active chemical and nuclear
    weapons development program, and is a major proliferator of missiles
    and related technologies. He increasingly supports illicit activities
    such as drug trafficking and counterfeiting to generate hard currency.
    North Korea demonstrates little regard for international convention or
    agreements. The regime repeatedly uses the threat of large-scale war
    and weapons of mass destruction in order to extort aid or other
    concessions from the international community.
        While reunification of the peninsula under North Korean control
    remains the primary stated purpose of the regime, Kim Jong Il's
    immediate overriding concern is to remain firmly in control. He
    personally occupies all key party, military, and government leadership
    positions. Kim Jong Il rules the Nation through a small cadre of
    lavishly rewarded elites who control all aspects of North Korean life.
    There is little evidence that any significant threat to the regime
    exists.
    The North Korean Economy
        The North Korean economy continues to decline and shows little
    prospect of recovery. Despite North Korea's limited experiments with
    reform, total economic output has dropped nearly 50 percent since 1992.
    Today, factories operate at less than 25 percent of 1992 capacity. The
    Nation's power and transportation infrastructure are in need of massive
    overhaul. Agricultural output can only feed 66 percent of the
    population. North Korea's economic decline is largely due to poor
    policy, mismanagement, under-investment, and a lack of resources. The
    regime's ``Military First'' policy directs approximately one-third of
    the domestic output to the military, thus limiting resources that could
    be used to improve the welfare of its people. North Korea's economy
    remains bolstered by aid from the international community and profits
    from regime-sanctioned illicit activities such as drug production,
    smuggling and counterfeiting.
    The North Korean Military
        The North Korean People's Army ensures regime survival by deterring
    external threats and providing the tool that enables the Kim regime to
    extort aid from the international community. North Korea has the fifth
    largest armed force in the world.\2\ The ground force has almost 1
    million active duty soldiers. About 70 percent of the North Korean Army
    is deployed south of Pyongyang, where they are capable of attacking
    with little tactical warning. A large number of North Korean long-range
    artillery systems can strike Seoul from their current locations. The
    North Korean air force has over 1,700 aircraft. The navy has
    approximately 800 vessels. The derelict North Korean economy has
    impaired the readiness, modernization, and sustainability of their
    conventional forces over the past decade, crippling Pyongyang's
    capacity to reunify the peninsula by force. However, the size,
    firepower, and proximity of North Korea's conventional forces to
    Seoul--coupled with their lethal asymmetric threats--give North Korea
    the capability to inflict great destruction and casualties if they
    chose to attack.
    ---------------------------------------------------------------------------
        \2\ North Korea has a population of 22 million; over 1 million are
    active duty military, an estimated 2 million are employed in military
    support or state security work, and over 6 million are members of the
    Armed Forces Reserve.
    ---------------------------------------------------------------------------
    North Korean Asymmetric Threats: Special Operations Forces, Missiles,
            and Weapons of Mass Destruction
        North Korea's asymmetric capabilities are large and dangerous.
    North Korea's 122,000-man SOF is the world's largest, and a high
    funding priority for the regime. They are tough, dedicated, well-
    trained, and profoundly loyal to the Kim regime. During conflict, these
    forces would direct long-range fires against key facilities, attack to
    disrupt command facilities of the ROK-U.S. Combined Forces Command, and
    seek to destroy force generation and reinforcement from beyond the
    peninsula.
        The North Korean ballistic missile inventory includes over 500 SCUD
    missiles that can deliver conventional or chemical weapons across the
    entire peninsula. They continue to produce and deploy medium-range No
    Dong missiles capable of striking cities and military bases in Japan
    with these same payloads. Continued research on a three-stage variant
    of the Taepo Dong missile could provide North Korea the capability to
    target the continental United States.
        North Korea has an assessed significant chemical agent stockpile
    that includes blood, blister, choking, and nerve agents. These weapons
    threaten both our military forces and civilians in the ROK and Japan.
    We also assess Pyongyang has an active biological weapons research
    program, with an inventory that may include anthrax, botulism, cholera,
    hemorrhagic fever, plague, smallpox, typhoid and yellow fever. North
    Korea believes that these missile, chemical, and biological weapons
    programs measurably contribute to its security from external threats
    and supplement their conventional military capabilities.
        North Korea's abandonment of the 1994 Agreed Framework and
    International Atomic Energy Safeguards Agreement, withdrawal from the
    Nuclear Nonproliferation Treaty, restart of the Yongbyon nuclear
    reactor, and declarations they have reprocessed 8,000 spent nuclear
    fuel rods indicate they are following a path that may lead to
    additional nuclear weapon production. The intelligence community
    assesses North Korea already has one or two nuclear weapons, and that
    they have the potential to make several additional nuclear devices. The
    Kim regime has clearly stated it will continue to increase its
    ``nuclear deterrent capability'' unless it receives significant
    economic assistance, security guarantees, and appropriate political
    concessions from the international community. In this context,
    proliferation of North Korean advanced weapons and related technologies
    remains a significant concern to the United States and its allies.
    Assessment of the North Korean threats
        North Korea poses a dangerous and complex threat to peace and
    security in the region and throughout the world. The Kim regime
    maintains a delicate balance of threats to ensure regime survival. They
    maintain a massive, offensively postured, conventional force that far
    exceeds the requirements to defend their country. Their continuing
    weapons of mass destruction programs constitute a substantial threat to
    Northeast Asia and the world. The Korean People's Army continues to
    invest heavily in military programs designed to offset our operational
    superiority. We see no indications the Kim regime will change its
    ``Military First'' policy, brinkmanship, nuclear challenges, missile
    proliferation, and illegal activities that ensure regime survival. The
    North Korean people will continue to suffer under an oppressive regime.
    For the foreseeable future, North Korea remains a major challenge to
    security in Northeast Asia.
                 the republic of korea--united states alliance
        The ROK-U.S. Alliance was formed to deter North Korean aggression
    and preserve peace and security in the region. For over 50 years, we
    have accomplished these tasks in a dynamic political and security
    environment. Much has changed in those 50 years, and many of the
    changes are irreversible. Our economies have prospered and become more
    intertwined. Democratic institutions are stronger, reflecting the
    aspirations of new generations. Though these changes have not always
    been smooth in either country, the Alliance has evolved to remain the
    foundation of regional deterrence and security. The ROK has been, and
    remains a reliable ally in regional and global security.
    The Republic of Korea Today
        Throughout our half-century of economic and security cooperation,
    the ROK has become one of the leading economic powers and a pre-eminent
    democracy in the region. The ROK has the 11th largest gross domestic
    product in the world, and the third largest in Northeast Asia. This
    growth has been fueled by global exports of high technology and
    consumer goods. The United States is the ROK's largest trading partner,
    with 2003 annual bilateral trade exceeding $59 billion. The United
    States was the second largest source of foreign direct investment in
    the ROK, totaling about $1.2 billion (19.2 percent of total) in 2003.
        While the ROK has firmly secured its place as an independent
    economic force in the global economy, 2003 has not been without
    challenges. Declines in domestic consumption slowed the growth of their
    domestic economy from 6.3 percent in 2002 to 2.9 percent in 2003. High
    household debt, rising unemployment, increasing individual and
    corporate bankruptcy, and disruptive labor strikes combined to further
    slow their economy. Rising labor costs and appreciation of the won
    against the dollar accompanied a shift in ROK foreign direct investment
    toward China and efforts to conclude bilateral free trade agreements
    with several nations. Most forecasts indicate a ROK economic recovery
    throughout 2004, with gross domestic product growing at rates between
    4.5 and 6 percent. Analysts expect the ROK's current and trade account
    surpluses to grow over 60 percent in 2004 on the strength of its export
    economy, particularly in the electronics and automobile sectors.
    Fostering economic recovery remains a top priority for the ROK
    government, essential to achieving President Roh's vision of
    transforming the ROK into the transportation, financial, and
    information technology hub of Northeast Asia. Beyond economic growth,
    the Roh administration is focusing on improving the domestic democratic
    process in ways that reflect new societal values of a younger
    generation.
        2003 can be considered a watershed in the development of democracy
    in the ROK. Older, less vocal conservative South Koreans continue to
    support a United States military presence on the Korean peninsula,
    reciprocal security cooperation under the Mutual Defense Treaty, and a
    pragmatic approach to North Korea. However, a generation born after the
    end of the Korean War has begun to assume a larger role in business and
    government. These younger Koreans are keenly aware of their
    achievements and motivated by a heightened sense of nationalism.
    Younger South Koreans generally want a more independent role in world
    affairs, a role consistent with the ROK's economic power. They advocate
    domestic and foreign policies based on national interest, particularly
    with respect to ROK-U.S. relations. Impassioned editorial debate and
    public demonstrations regarding the presence of USFK, the ROK's
    dispatch of troops to Iraq and resolving the North Korea nuclear issue
    demonstrate the strength of their views and the dynamics of domestic
    Korean politics. These dynamics firmly demonstrate that the ROK
    continues to be a healthy democracy, fully capable of managing change
    through constitutional processes.
        Generational perspectives on North Korea clearly illustrate the
    changing social and political dynamics in ROK society. There is a clear
    generational divide over the military threat posed by North Korea.
    Older South Koreans, who recall the devastation caused by the Korean
    War, express a desire to maintain a strong defense against the North
    while following a path of pragmatic engagement to reduce North Korean
    military threats in a sustainable multi-lateral way. Younger South
    Koreans view North Korea as peaceful cultural brothers and potential
    trading partners. Some younger Koreans perceive little military threat
    from the North, expressing the view that North Korea would never use
    its military against the ROK. However, most South Koreans agree on two
    issues: first, a nuclear armed North Korea is an intolerable threat to
    stability; and second, catastrophic failure of the North Korean system
    would destabilize the entire region and have substantial adverse
    consequences for South Korea. To avoid these adverse consequences and
    accommodate domestic views, the ROK has adopted a patient approach
    toward inter-Korean relations.
        The Roh administration developed the ``policy for peace and
    prosperity'' to guide inter-Korean relations.\3\ This policy formally
    opposes North Korea's pursuit of nuclear weapons while continuing
    efforts toward inter-Korean rapprochement through humanitarian
    assistance, family reunions, tourism, and trade. Under the Ministry of
    Unification's ``policy for peace and prosperity'', inter-Korean
    commerce has steadily grown to $670 million per year. The Ministry of
    Unification plans to expand access to the Mt. Gumgang tourist resort,
    develop investment in the proposed Kaesong Industrial Complex, and use
    the inter-Korea transportation corridors to further advance the ROK as
    the transportation hub of Northeast Asia. The ``policy for peace and
    prosperity'' envisions this increased economic prosperity as the engine
    of peace and the key to replacing the Armistice Agreement with a peace
    agreement.\4\ However, full implementation of this policy is predicated
    on resolving the North Korean nuclear issue.
    ---------------------------------------------------------------------------
        \3\ ``The Policy for Peace and Prosperity'' was developed by the
    Republic of Korea Ministry of Unification and published in 2003;
    updated in January 2004. In summary, the goals of the policy are: (1)
    promote peace on the peninsula; and, (2) pursue mutual prosperity for
    North and South Korea while contributing to prosperity in Northeast
    Asia. Guiding principles and implementing actions include: resolve
    issues through dialogue; promote international cooperation ``based on
    the principle of the parties directly involved''; expand public
    participation in rapprochement dialogue; peacefully resolve the North
    Korean nuclear issue, fully accounting for the positive impact of
    inter-Korean economic cooperation; and replace the Armistice Agreement
    with a Peace Agreement. Available from http://www.unikorea.go.kr/en/
    main.php, accessed January 20, 2004.
        \4\ The ``Policy for Peace and Prosperity'' seeks ``the eventual
    replacement of the current armistice agreement with a peace agreement
    between South and North Korea.'' It acknowledges that ``International
    institutional arrangements safeguarding the peace regime should also be
    pursued.'' This Republic of Korea policy seeks a bilateral inter-Korean
    agreement, rather than a comprehensive solution that involves the
    parties represented by the Armistice Agreement.
        The Armistice Agreement, between senior representatives from the
    Korean People's Army, Chinese People's Volunteers, and, the United
    Nations Command, was signed on July 27, 1953 to govern cessation of
    hostilities on the Korean Peninsula. Because the Armistice Agreement
    has not been replaced by a permanent peace settlement, it remains the
    governing authority over all activity inside the Demilitarized Zone,
    including inter-Korean commerce and humanitarian visits. Article I of
    the Armistice Agreement establishes the Military Demarcation Line and
    Demilitarized Zone (DMZ) between the forces and prevents access to the
    DMZ without consent from the Military Armistice Commission. Today, the
    northern side of the DMZ is controlled by the Korean People's Army and
    the southern side of the DMZ is controlled and administered by United
    Nations Command. Article II establishes concrete measures to ensure
    separation of forces along the DMZ. The balance of the Armistice
    Agreement outlines composition, authorities and responsibilities of the
    Military Armistice Commission; recommends that the governments seek
    peaceful settlement of the Korean question, and provides measures for
    amending the Armistice by mutual agreement.
    ---------------------------------------------------------------------------
        Diverse public opinion reflects the growth of democratic freedoms
    and nationalism in the ROK. The ROK is experiencing changes familiar to
    other democracies--healthy growth and generational transfer of
    authority. It seeks to adapt its foreign policy, establishing more
    egalitarian relations based on mutual interests rather than historical
    attachment. Undoubtedly, United States policies in general, and the
    nature of United States military presence in Korea, are likely to
    remain a central issue in the domestic Korean policy debate,
    particularly in the weeks before the April 2004 quadrennial National
    Assembly elections. Biased media portrayal of the ROK-U.S. Alliance
    will likely continue; however, the foundations of such expressions of
    bias are as much a function of Korean domestic politics as it is an
    expression of genuine anti-American sentiments. However, continued
    cooperation on security interests shows that the Republic of Korea
    continues to be a reliable ally.
    Growth in the Republic of Korea--United States Alliance
        This past year marked the 50th Anniversary of the ROK-U.S. Mutual
    Defense Treaty and the Armistice Agreement. Veterans of many nations
    who defended the Republic of Korea during the 1950-1953 war returned to
    Korea to commemorate these historic events. South Koreans of all ages
    welcomed these Korean War veterans, proudly displaying the democratic
    society and economic miracle that grew from the dedication and
    sacrifice of those who defeated unprovoked North Korean aggression.
        During their May 2003 Summit Meeting, President Bush and President
    Roh noted the significance of the 50-year partnership and highlighted
    the importance of building a dynamic alliance relationship for
    continued peace and prosperity on the Korean Peninsula and in Northeast
    Asia. Noting the ROK's growing national strength, the presidents
    pledged to increase mutual security cooperation and to modernize the
    Republic of Korea--United States Alliance by improving military
    capabilities, and consolidating United States Forces south of the Han
    River, including the relocation of United States Forces from the Seoul
    metropolitan area at an early date. The shared views of President Bush
    and President Roh have reinforced the importance of frank dialogue and
    mutually beneficial cooperation between our Nations.
    The Republic of Korea's support to global and regional security
        Consistent with this spirit of mutual cooperation, the Republic of
    Korea continues to increase its contributions to allied defense
    burdensharing through troop contributions and pledges of humanitarian
    assistance for Afghanistan and Iraq, participation in United Nations
    peacekeeping operations, and sharing the costs of stationing United
    States Forces in Korea.
        The Republic of Korea remains a consistent contributor to regional
    security and the war on terror. The Ministry of National Defense
    maintains liaison officers at USPACOM and CENTCOM to coordinate support
    for ROK contingents participating in United States-led coalition
    operations in Iraq and Afghanistan. The ROK continued its second year
    of troop and financial support to operations in Afghanistan. Throughout
    2003, the ROK provided a 56-man medical unit and a 150-member engineer
    construction unit in Afghanistan, along with a 38-man medical
    detachment in Kyrgyzstan. ROK contributions to Afghanistan, valued at
    $155 million, included transportation support, radios for two newly
    formed Afghan National Army battalions, and in-kind military
    contributions to stability and reconstruction. The ROK maintains its
    pledge to provide $45 million in reconstruction funds focused on Afghan
    vocational-technical education and medical assistance, $150,000 for
    Interim Afghan Administration expenses and $12 million for regional
    humanitarian aid to Afghanistan's neighbors in the 2002-2004 period.
        Following the defeat of the Saddam Hussein regime in Iraq, the ROK
    provided a 675-man noncombatant contingent for stability operations and
    donated $60 million for reconstruction projects. In October 2003, the
    Roh administration pledged an additional $200 million, delivered over
    the next 4 years, for reconstruction projects in Iraq. In December
    2003, the Roh government pledged to send additional troops to assist
    with reconstruction and humanitarian operations. In February 2004, the
    National Assembly authorized deployment of up to 3,000 additional
    troops composed of both non-combat forces for reconstruction and
    infantry and special operations troops for force protection.\5\ CENTCOM
    and the ROK Ministry of National Defense continue to coordinate the
    details of this additional troop deployment. We congratulate the ROK
    for their continued pledges of commitment to the growing global
    coalition assisting with Iraqi recovery.
    ---------------------------------------------------------------------------
        \5\ On February 13, 2004, the Republic of Korea National Assembly
    authorized deployment of up to 3,000 additional troops ``for the
    purpose of peace-keeping and reconstitution to Iraq from 1 April to 31
    December 2004.''
    ---------------------------------------------------------------------------
        Beyond Afghanistan and Iraq, the ROK has been a partner in U.N.
    peacekeeping operations around the globe. After approximately 4 years
    of supporting the U.N. mission in East Timor, the ROK withdrew its 250-
    man infantry battalion last October. Six ROK staff officers remain in
    East Timor to support the United Nations operation in the world's
    newest nation. The ROK continued to post 20 medical officers in the
    Western Sahara, 9 military observers to the Kashmir mission, and 7
    military observers in Georgia. Additionally, Lieutenant General Hwang
    Jin-ha continued to command the U.N. Peacekeeping Force in Cyprus, the
    first instance of the Republic of Korea commanding a United Nations
    peacekeeping force. Collectively, these contributions are a strong
    testament to the ROK's commitment to stability and security beyond the
    Korean Peninsula.
    The Republic of Korea's support to United States Forces Korea
        The ROK government continued to increase its contributions to
    offset the cost of maintaining USFK. In 2003, the ROK provided support
    equivalent to approximately 40 percent of the non-personnel stationing
    costs of USFK. Last year's indirect cost sharing was valued at
    approximately $544 million and direct cost sharing was $540 million.\6\
    Based on the current rate of cost-sharing increases, the ROK is poised
    to enter the top half of allied nations contributing to the cost of
    maintaining the installations and services supporting USFK stationed
    within their borders. The upcoming negotiations for the ROK-U.S.
    Special Measures Agreement provide a welcome opportunity to develop a
    long-term agreement for sustained real growth in ROK defense cost-
    sharing contributions.
    ---------------------------------------------------------------------------
        \6\ Indirect cost sharing includes foregone rents for facilities
    used by United States Forces Korea and tax exclusions for goods and
    services provided under the Status of Forces Agreement. Direct cost-
    sharing contributions are governed under the existing Special Measures
    Agreement, which will expire in 2004. Under this agreement, the
    Republic of Korea annually increases direct cost sharing by 8.8
    percent, adjusted for inflation. Direct cost sharing contributions are
    a combination of cash payments and in-kind services. Republic of Korea
    direct cost-sharing contributions for 2004 are estimated to be $602
    million based on current economic projections.
    ---------------------------------------------------------------------------
          strengthening the republic of korea--united states alliance
        Efforts to strengthen the alliance begin with improving the South
    Korean people's appreciation of United States Forces based in Korea.
    The ``Good Neighbor'' programs at every command level continue to
    emphasize the importance of reaching out to our South Korean hosts to
    foster a better understanding of our shared values and interests. To
    connect directly with the South Korean people, we established an
    interactive Korean language web site as a source of information on
    United States Forces Korea. A Korea Advisory Council meets quarterly
    and remains a productive venue for senior USFK leaders to dialogue with
    the ROK's leading citizens, religious leaders, academics, and
    government and business officials. The Korea Advisory Council, coupled
    with the interactive Korean language web site, ensures that our Korean
    hosts have the opportunity to present their views directly to senior
    leaders at every command level of United States Forces based in Korea.
        All commanders of United States units have continued their ``Good
    Neighbor'' programs that are centered on community outreach programs to
    improve mutual understanding with their local hosts. ``Good Neighbor''
    programs include the Adopt-A-School program, cultural tours and
    exchanges, volunteer English language tutors, and sponsorship of
    orphanages. These efforts contribute to mutual appreciation and allow
    our servicemembers to contribute to the communities in which they live
    and work. Particularly impressive was the large number of United States
    soldiers, sailors, airmen, and marines who volunteered their time to
    assist local communities to clean up after Typhoon Maemi ravaged
    several communities last September.
        These community outreach programs have been accompanied by a
    measurable reduction in the frequency and intensity of protest
    demonstrations in South Korean host cities. Our efforts to improve
    mutual understanding cannot guarantee that United States presence in
    Korea will not be manipulated for domestic political purposes. However,
    we can safely deduce that these community outreach programs contribute
    to building individual friendships that will strengthen the South
    Korean appreciation for the contributions that the men and women of
    USFK bring to the Korean peninsula and Northeast Asia.
    Transforming the Commands
        The ROK-U.S. Alliance--a security partnership forged during the
    Korean War and exemplified today through the United Nations Command and
    ROK-U.S. Combined Forces Command--is the foundation for the security of
    the Korean peninsula and continued regional stability. The ROK-U.S.
    Presidential Summit Meeting in May 2003 reinforced the importance of
    the alliance for maintaining vigilance towards North Korea and
    preparing the alliance to contribute to broader regional stability in
    the longer term. The two presidents reinforced their mutual desire to
    establish a stable stationing plan that supports a sustainable, long-
    term United States presence and contributes to continued regional
    stability. These mutual presidential commitments reinforce the ongoing
    policy dialogue to foster military transformation and improve the
    alliance through the Future of the ROK-U.S. Alliance Policy Initiative.
        The Future of the ROK-U.S. Alliance Policy Initiative is a 2-year
    long series of consultations, jointly chartered by the United States
    SECDEF and ROK Minister of National Defense at the 34th Security
    Consultative Meeting in December 2002, designed to strengthen and
    transform the alliance.\7\ Key tasks of this consultative body include:
    integrate the transformations of the United Nations Command, ROK-U.S.
    Combined Forces Command, and USFK; establish a sustainable stationing
    environment for United States Forces based in Korea; and examine ways
    to strengthen the alliance in the mid- to long-term. The first year's
    discussions made significant progress on each of these issues,
    resulting in agreements to enhance, shape, and align forces to deter
    North Korea and prepare for future security missions to enhance
    stability in the broader Northeast Asia region. Briefly stated, the
    objectives of the ``Enhance, Shape, and Align'' concept are to ensure
    that we: have the right capabilities on the peninsula to deter and, if
    necessary, defeat North Korean aggression; assign roles and missions to
    the appropriate units; and replace the post-Cold War basing plan with
    less intrusive, enduring hubs. The subsequent paragraphs describe how
    the ``Enhance, Shape, and Align'' concept, supported by command
    priorities, has strengthened the ROK-U.S. Alliance and contribute to
    transformation of United Nations Command, Combined Forces Command, and
    USFK.
    ---------------------------------------------------------------------------
        \7\ The Future of the Republic of Korea--United States Alliance
    Policy Initiative is a fully integrated interagency consultative effort
    of both governments. The United States delegation includes
    representatives of the Department of State, Office of the Secretary of
    Defense, United States Joint Staff, United States Pacific Command, and
    United States Forces Korea. The Republic of Korea delegation represents
    the National Security Council, the Ministry of Foreign Affairs and
    Trade, the Ministry of National Defense, and the Republic of Korea
    Joint Staff.
    ---------------------------------------------------------------------------
    United Nations Command
        The United Nations Command, the longest standing coalition in the
    history of the United Nations, represents the international community's
    enduring commitment to security and stability on the Korean
    peninsula.\8\ On behalf of the 15 member nations, the United Nations
    Command actively supervises compliance with the Armistice Agreement,
    fulfilling the mutual pledge to ``fully and faithfully carry out the
    terms'' of the Armistice and ``if there is a renewal of the [North
    Korean] armed attack, challenging again the principles of the United
    Nations, we should again be united and prompt to resist.'' Today, the
    members of the United Nations Command coalition in Korea remain
    vigilant in an uneasy peace; ensuring compliance with the Armistice
    Agreement.
    ---------------------------------------------------------------------------
        \8\ U.N. Security Council Resolutions following the 1950 North
    Korean invasion established the United Nations Command. United Nations
    Command member nations are: Australia, Belgium, Canada, Columbia,
    Denmark, France, Greece, The Netherlands, New Zealand, Norway,
    Philippines, Thailand, Turkey, United Kingdom, and the United States.
    ---------------------------------------------------------------------------
        United Nations Command responsibilities include Armistice-related
    meetings, impartial investigations of alleged Armistice violations
    committed by either side, and supervision of the two transportation
    corridors through the Demilitarized Zone. Last year, United Nations
    Command officers held 26 meetings with representatives of the North
    Korean People's Army at Panmunjon to discuss matters related to the
    Armistice. These meetings continue to be an important forum for frank
    dialogue, preventing potential miscalculation or misinterpretation by
    the forces deployed along the DMZ.
        Impartially investigating allegations of Armistice violations on
    both sides of the Military Demarcation Line prevents relatively minor
    incidents from escalating into destabilizing crises. In 2003, the
    United Nations Command conducted 22 special investigations of
    incidents, concluding that the North Korean People's Army had committed
    13 major violations of the Armistice Agreement. These violations, an
    increase over last year, raised significant concerns because they
    involved unauthorized Military Demarcation Line crossings or discharge
    of weapons inside the DMZ. The prompt and transparent United Nations
    Command investigation of Armistice-related incidents prevented
    escalation or miscalculation.
        The United Nations Command also monitors Armistice compliance and
    approves DMZ crossings associated with the ongoing construction of the
    two transportation corridors through the DMZ. These transportation
    corridors are integral to the ROK's efforts to foster inter-Korean
    reconciliation and cooperation. Because of the threat posed by North
    Korea's forward deployed forces, the United Nations Command rigorously
    enforces Armistice rules for activities inside the DMZ. This diligence
    ensures that the transportation corridors cannot be exploited for
    prohibited purposes that may adversely affect the security of the ROK.
        The United Nations Command has full responsibility for enforcing
    the Armistice. It has delegated responsibility for patrolling the
    southern half of the DMZ, except the Joint Security Area at Panmunjon,
    to ROK Army units. A combined ROK-U.S. battalion, organized under the
    United Nations Command, provides the physical security of the Joint
    Security Area. During the 25th meeting of ROK-U.S. Military Committee
    in December 2003, our two nations agreed to transfer primary
    responsibility for the protection of the Joint Security Area from
    United States to ROK forces in 2004.\9\ The Military Committee agreed
    that the United States will continue to command the United Nations
    Joint Security Area Security Battalion and provide the nucleus of
    staff, while the ROK will replace all United States personnel directly
    involved in security patrols, manning observation posts, and base
    operations support. This mission transfer is part of a more
    comprehensive agreement adjusting the roles and missions of the
    respective Armed Forces, which acknowledges the increased capabilities
    of the ROK Army and the predominant ROK role in its national security.
    ---------------------------------------------------------------------------
        \9\ The Republic of Korea--United States Military Committee,
    established by the Combined Forces Command's Terms of Reference and
    Strategic Directives, includes the Senior United States Military
    Representative in Korea, the Chairman of the United States Joint Chiefs
    of Staff, the Chairman of the Republic of Korea Joint Chiefs of Staff,
    the Commander of Combined Forces Command and appropriate members of
    their respective staffs. The Military Committee holds annual meetings
    to review combined defense policy issues and act on directives from the
    Republic of Korea--United States Security Consultative Meeting.
    ---------------------------------------------------------------------------
        For the foreseeable future, the United Nations Command will
    continue its significant contributions to security and stability on the
    Korean peninsula and in the region. Beyond its direct responsibilities
    to enforce the Armistice, the United Nations Command has the potential
    to become a forum for improving regional military cooperation between
    the ROK and Japan. This near-term cooperation centers on the seven
    United Nations Command bases located in Japan that provide logistical
    support in the event of a conflict on the Korean Peninsula.\10\
    Notably, the USPACOM TSCP recognizes this opportunity to enhance
    regional security cooperation. This year's visit to United Nations
    Command rear bases in Japan by the ROK's Chairman of the Joint Chiefs
    of Staff is but one example of the United Nations Command's ability to
    facilitate regional security cooperation. Rest assured that the
    dedicated members of the United Nations Command, backed by the 15
    member nations and Combined Forces Command, continue to guard the
    security of the ROK, and contribute to improved regional security
    cooperation and confidence building. Congressional approval of Title
    XII provisions that allow the United States to support our foreign
    coalition liaison officers will continue to enhance the effectiveness
    of the United Nations Command and Combined Forces Command.
    ---------------------------------------------------------------------------
        \10\ Eight of the United Nations Command (UNC) member nations
    maintain liaison with the UNC rear headquarters in Japan: Australia,
    Canada, France, New Zealand, Philippines, Thailand, United Kingdom, and
    the United States. Use of UNC bases in Japan is governed by a status of
    forces agreement between United Nations Command and the Government of
    Japan. UNC rear bases are located on Honshu (Camp Zama, Yokota Air
    Base, and Yokosuka Naval Base), Kyushu (Sasebo Naval Base), and Okinawa
    (Kadena Air base, Futenma Marine Corps Air Station, White Beach Naval
    Facility).
    ---------------------------------------------------------------------------
    Combined Forces Command
        Since its inception a quarter century ago, the Combined Forces
    Command has been the cornerstone of deterrence on the Korean peninsula:
    vigilant; well trained; ready to fight tonight and win. This combined
    deterrence is achieved by an integrated team of approximately 680,000
    active and 3,040,000 Reserve personnel from the ROK and more than
    37,500 United States military personnel forward deployed on the Korean
    peninsula.\11\ The United States Forces assigned to Korea add state-of-
    the-art operational capabilities to the Korean peninsula. Together,
    these forces are a potent, integrated team with the military prowess
    and dominant military capabilities to defeat any provocation on the
    Korean peninsula, deterring escalation that could destabilize the
    region.
    ---------------------------------------------------------------------------
        \11\ Republic of Korea Ministry of National Defense, Parcipatory
    Government Defense Policy 2003. Active Forces include 550,000 Army,
    67,000 Navy and Marine Corps, 63,000 Air Force. Active Forces are
    predominantly composed of conscripts with a 24-28 month term of
    service.
    ---------------------------------------------------------------------------
        Readiness is the hallmark of the ROK-U.S. Combined Forces Command.
    The robust annual Combined Forces Command exercise program, supported
    by subordinate command training programs, ensures that the command is
    prepared for likely contingencies. The theater-level exercises, Ulchi-
    Focus Lens; Reception, Staging, Onward Movement, and Integration; and
    Foal Eagle collectively train over 400,000 active and Reserve component
    personnel in the critical tasks essential to deterring, and if
    necessary, defeating a limited warning attack against the alliance.
    These command post and field training exercises use battle simulations
    technologies to train leaders in battle command, leveraging the
    significant theater-wide investment in C\4\ and Intelligence systems.
    These combat enablers provide the means to collaboratively plan,
    execute, and assess effects from distributed locations; allowing the
    Combined Forces Command to see, understand, and act to dominate the
    battlespace. Ulchi-Focus Lens is a simulation-driven command post
    exercise focused on joint and combined effects-based operations, and
    sustaining command and control, logistics, and dominant maneuver skill
    sets. The objective of the Reception, Staging, Onward Movement, and
    Integration exercise is to improve the ability to rapidly reinforce and
    sustain operations in the Korean theater. Foal Eagle is where the
    ``rubber meets the road,'' providing a field training environment for
    tactical-level joint and combined warfighting skills and
    interoperability. These exercises, supplemented by subordinate command
    training programs, ensure that the Combined Forces Command remains
    ready to fight tonight and win decisively.
        As we have for the last 25 years, the Combined Forces Command
    continues to adapt to the changing security environment. This
    transformation is taking place in three key areas: enhancing combined
    capabilities; shaping roles and missions; and aligning forces for the
    mid- to long-term. Close cooperation between the defense leadership of
    the ROK and the United States, and the leaders of the Combined Forces
    Command and USFK ensures that these changes enhance readiness and
    combined deterrence.
        Enhancing Combined Capabilities
        Most visible are the capabilities enhancements we are making
    through force modernization. In November 2003, the ROK-U.S. Military
    Committee reaffirmed mutual commitment to complementary, interoperable
    capabilities enhancements. The United States presented a force
    modernization program that brings state-of-the-art equipment to the
    Korean peninsula over the next 3 years. United States Forces based in
    Korea have already received tactical unmanned aerial vehicles, improved
    command, control, communications, and computers systems, and are
    beginning improvement programs for United States major combat systems
    and munitions. In 2003, the United States deployed enhanced
    capabilities to protect key installations and conducted rotational
    deployments to demonstrate the ability to rapidly deploy ground, air,
    and maritime forces to the peninsula. These programs are essential to
    the readiness that has deterred conflict on the Korean peninsula while
    the United States and its coalition partners prosecute the war on
    terror. The powerful deterrent capabilities of forward deployed forces
    continue to be a key enabler for our defense strategy.
        The Ministry of National Defense views continued security
    cooperation with the United States as a cornerstone of the ROK's
    defense strategy. The Ministry of National Defense Modernization Plan
    seeks to enhance complementary ROK defense capabilities. This plan
    includes purchases of many defense systems produced by the United
    States and joint ventures to domestically produce advanced weapons in
    the ROK. Highlights of the Ministry of National Defense Mid-Term
    Defense Modernization Plan include missile defense systems, advanced
    aircraft, precision munitions, and advanced naval combat and amphibious
    ships.
        The ROK Air Force's recent procurement of the F-15K fighter is on
    schedule, with the first deliveries scheduled for 2005. These aircraft
    will be capable of employing a wide range of all-weather precision
    munitions that have proven extremely effective during recent United
    States-led coalition operations. The ROK Army will complete fielding in
    2004 of a second Multiple Launch Rocket System battalion consisting of
    29 launchers, 310 extended range ammunition pods, and 110 Army Tactical
    Missiles to enable long-range precision strike by this new
    organization. The ROK Navy has signed a contract to purchase eight
    additional P-3 anti-submarine warfare aircraft, received its third KDX-
    II destroyer this year, and the KDX-III, equipped with the Lockheed-
    Martin AEGIS system, is on track for delivery in 2008.
        The Ministry of National Defense Mid-Term Defense Modernization
    Plan also includes several developmental programs to improve self-
    defense capabilities. Highlights include an improved missile defense
    system, air-to-air refueling platforms for high performance aircraft,
    advanced warning and airspace control aircraft, a multi-role helicopter
    system to replace an aging fleet, as well as advanced amphibious
    support ships, frigates, and patrol boats. These programs, commencing
    after 2007, are a needed step toward a self-reliant, modern defense
    capability.
        The ROK's self-defense strategy goes beyond equipment
    modernization. It includes developing organizational and operational
    concepts that gain efficiencies by taking full advantage of increased
    equipment capabilities. The Ministry of National Defense is studying
    options to restructure its forces with more equally balanced air,
    naval, and ground components. These proposed changes will improve
    deterrence and are consistent with ongoing materiel and doctrinal
    capabilities enhancements. USFK continues to closely coordinate with
    the Ministry of National Defense to ensure that the United States
    capabilities resident in Korea provide the appropriate mix of skilled
    personnel, equipment, and infrastructure to maintain deterrence and
    promote regional stability.
        However, the Republic of Korea defense budget is insufficient to
    fully implement its Mid-Term Defense Modernization Plan--a fundamental
    obstacle to achieving the Ministry of National Defense's goals. Even
    after this year's minimal defense budget increase to 2.8 percent of
    Gross Domestic Product (GDP), the ROK's defense purchasing power
    remains near 1997 levels. Rising operations and maintenance costs,
    limited force development appropriations, and a defense spending at
    less than 3 percent of Gross Domestic Product will likely delay the
    overall Ministry of National Defense capabilities enhancement program.
        Shaping Roles and Missions
        Enhancing ROK military capabilities, the Military Committee agreed
    to transfer certain Combined Forces Command missions from United States
    Forces to ROK forces over the next 3 years. These changes will not
    decrease readiness or deterrence. Moreover, these mission transfers
    take full advantage of the strengths of ROK forces, and tailor United
    States Forces in Korea for the unique contributions that they make to
    the peninsula and the region. The ROK-U.S. Combined Forces Command is,
    and will remain, the cornerstone of deterrence on the Korean peninsula
    for the foreseeable future. These efforts to transform the command will
    improve interoperability and maintain operational dominance into the
    future.
    USFK
        Transformation of USFK is underway. Your recent investments in
    equipment and infrastructure have improved operational capabilities and
    the quality of life for United States servicemembers, DOD civilian
    employees, and family members. This total transformation effort--
    enhance, shape, and align--contributes to increased strategic relevance
    and flexibility for United States Forces based in Korea and around the
    globe. Our transformed forces and basing posture enable more rapid
    reinforcement of the Korean theater in the event of a crisis and
    improves deterrence, on the peninsula and beyond, by providing
    strategically mobile overmatching power to dissuade potential threats
    to Alliance interests. Your continued support will ensure we achieve
    our transformation goals, providing our forces with the resources
    needed to deter aggression and contribute to regional stability.
        The capabilities enhancements and mission transfers previously
    presented are key elements of USFK transformation. Consolidating United
    States Forces based in Korea into two hubs is the final component of
    this transformation effort. This consolidation consists of two parallel
    actions: relocation of United States Forces from the Seoul metropolitan
    area (commonly referred to as Yongsan Relocation), and realignment of
    the United States Second Infantry Division.
        Relocation of United States Forces from the Seoul metropolitan area
        Relocation of United States Forces from the Seoul metropolitan area
    is an important initiative with a long history. In 1990, at the request
    of the ROK and under the authority of the Status of Forces Agreement,
    the two governments completed a written agreement to relocate all
    United States Forces from Seoul to locations south of the Han River
    near Osan AB and Camp Humphreys. This relocation would have provided a
    more sustainable stationing environment for United States Forces and
    returned valuable land to the citizens of Seoul. The terms of the
    agreement--negotiated in good faith and consistent with the domestic
    laws of both nations at the time of signing--optimized capabilities
    while ensuring no degradation to readiness, operational capability,
    safety, force protection, or quality of life for the Korean and United
    States citizens who support the United Nations Command, the Combined
    Forces Command, and USFK. Under these agreements, the United States
    promptly returned a sizeable portion of the Yongsan Garrison to the
    ROK, on which a ROK national museum has been built. However, in 1993
    the United States received notification that the ROK would unilaterally
    suspend its implementation of the agreements.
        As part of the Future of the ROK-U.S. Alliance Policy Initiative,
    the ROK government asked to renew discussions on implementing the
    relocation of United States Forces from the Seoul metropolitan area.
    These discussions have been candid and productive, with agreement on
    major points: all relocations will be completed by 31 December 2007,
    with the understanding that the target date for the relocation of the
    headquarters of United Nations Command, Combined Forces Command, and
    USFK will be 31 December 2006; a small residual United States military
    presence will remain in Seoul to coordinate with the Ministry of
    National Defense and maintain a United States armed forces recreation
    center; and the ROK responsibility to fund this relocation, providing
    all necessary facilities and infrastructure to optimize operational
    capabilities for the headquarters', and maintain quality of life for
    personnel supporting those commands. When completed, these agreements
    will preserve the principles of the 1990 agreements, comply with the
    domestic laws of both nations, and ensure no reduction in readiness,
    deterrence, operational capability, safety, force protection or quality
    of life for the ROK and United States personnel affected by the
    relocation. We look forward to concluding the necessary agreements
    promptly, providing the National Assembly ample time to consider and
    ratify them according to the domestic requirements of the ROK.
        Realignment of United States Second Infantry Division
        The second facet of consolidating United States Forces into two
    hubs is realignment of Second Infantry Division. This realignment
    serves two main goals: transform the United States basing posture from
    its inefficient post-Korean War posture to a stable, less intrusive
    footprint; and focus construction investments into enduring facilities
    within the two hubs south of the Han River. While some Koreans have
    expressed anxiety that this realignment may send the wrong message to
    North Korea, we have clearly explained how this plan leverages our
    improved capabilities to improve readiness and deterrence while
    supporting a long-term United States military presence in the ROK.
        Representatives of the Office of the Secretary of Defense and the
    Ministry of National Defense have agreed on a two-phased process to
    realign the Second Infantry Division. The first phase--a logical
    extension of the Land Partnership Plan--consolidates the Second
    Infantry Division into existing installations while construction takes
    place south of the Han River.\12\ This plan allows all construction for
    the realignment of Second Infantry Division to be completed by 2008. In
    November 2003, we completed the necessary documents to modify the Land
    Partnership Plan to accommodate this realignment plan. The Ministry of
    National Defense has procured the first 200 acres needed to expand Camp
    Humphreys with funds provided by the return of the first property under
    the Land Partnership Plan. The Ministry of National Defense is
    diligently working to purchase all of the land required to expand both
    Camp Humphreys and Osan Air Base. The second phase of this plan will
    consolidate all of the Second Infantry Division units in Korea into the
    new facilities south of the Han River. Stable funding of United States
    military construction projects in the Future Years Defense Plan remains
    a crucial element of this plan. I remain enthusiastic about this win-
    win approach to recapitalizing our infrastructure in a sustainable,
    enduring way and look forward to accelerating our progress toward
    completing this necessary consolidation.
    ---------------------------------------------------------------------------
        \12\ The ROK ratified the Land Partnership Plan in 2003. This plan
    reduced the number of United States installations in Korea from 41 to
    23. The Land Partnership Plan shares relocation costs between both
    governments--each nation bearing the costs of the relocations it
    requested. Stable United States military construction appropriations
    are essential to implementing the Land Partnership Plan.
    ---------------------------------------------------------------------------
                      sustained investment for the future
        My command priorities remain consistent with my previous testimony:
    ensure peace and stability on the Korean Peninsula; readiness and
    training; strengthen the ROK-U.S. Alliance; transformation of the
    command; and, making Korea an assignment of choice. I have addressed
    most of the actions to enhance, shape, and align the force to meet
    these priorities. However, two areas merit additional comment:
    readiness and training; and, making Korea the assignment of choice.
    Readiness
        Readiness remains my top priority. Your continued support to
    capabilities enhancement and our training program is crucial. Key focus
    areas for modernization are: joint and combined C\4\; ISR; pre-
    positioned equipment and logistics; and counterfire capabilities and
    precision munitions. With your help, we have made meaningful progress
    in joint and combined C\4\ integration. We also improved the
    survivability of intra-theater communications networks and established
    a state-of-the-art Common Operational Picture and Collaborative
    Planning System that shares information among all commanders on the
    peninsula in real time. The next step is accelerated development of
    automated data filter devices to expand the real time information
    exchange between United States and ROK Forces. We need to continue
    these improvements and couple them with emerging coalition warfighting
    C\4\ systems to establish a hardened, secure long-haul strategic
    communications network to support our missions both on the peninsula
    and throughout the region.
        The regional missile threat requires a robust theater missile
    defense system to protect critical United States capabilities and
    personnel in the ROK. Last year's deployment of Patriot upgrades and
    improved munitions was a significant enhancement. To protect all
    critical United States facilities in Korea, we need to continue
    fielding advanced theater missile defense capabilities in the near-
    term. Your continued support to these service component programs
    remains integral to protecting United States Forces.
        Robust ISR capabilities are essential to rapid, decisive
    operations. Our long-term program of continuous improvement is working.
    Last year, short-range UAVs that improved our tactical ISR capability
    were fielded in Korea. The next step is fielding long-range, high-
    altitude UAVs that can conduct some of the missions now performed by
    manned reconnaissance aircraft. Beyond collection platforms, we
    continue to improve our intelligence analysis capabilities to provide
    commanders with the timely, accurate assessments necessary to establish
    conditions that enable rapid dominance of the battle space. Your
    continued support for modernizing ISR capabilities is a wise investment
    for the future.
        Logistically supporting United States Forces based in Korea is a
    complex, monumental undertaking. The proximity of the North Korean
    threat, coupled with the long distances from the United States
    sustainment base, requires a robust and responsive logistics system to
    support United States Forces based in Korea. The capabilities
    enhancements programmed for United States Forces based in Korea will
    improve our core logistics functions through modern prepositioned
    equipment, responsive strategic transportation, and modern logistics
    tracking systems. Pre-positioned equipment sets, which include critical
    weapons systems, preferred munitions, repair parts, and essential
    supplies, are critical to the rapid power projection to reinforce the
    Korean theater. Responsive strategic transportation--fast sealift ships
    and cargo aircraft--remain indispensable to rapidly reinforce the
    Korean theater and sustain United States Forces. Expeditious fielding
    of the Air Force's C-17 fleet and the Army's Theater Support Vessel to
    the USPACOM AOR remains a high priority to support United States Forces
    based in Korea. Equally important is the ability to maintain intransit
    visibility of supplies and equipment with a modernized joint Logistics
    C\4\ and Information system. Lessons from Operation Iraqi Freedom and
    Operation Enduring Freedom have highlighted several areas where
    relatively small investments in asset tracking systems and theater
    distribution will yield significant efficiencies and improve the
    overall effectiveness of the logistics system. Your continued support
    for improved logistics and sustainment programs will ensure that United
    States Forces have the right equipment and supplies at the right time.
        Counterfire and precision strike are core capabilities for all of
    our contingency plans, allowing us to change the dynamics of a conflict
    and rapidly achieve campaign objectives. Increasing the forward stocks
    of preferred munitions is critical to operational success in the Korean
    theater. Our priority ordnance requirements include: the Army Cruise
    Missile System, the extended-range Multiple Launch Rocket System,
    precision guided munitions, air-to-ground missiles, and air-to-air
    missiles. Your continued support to these programs provides the
    overmatching capabilities that undergird deterrence.
    Making Korea an Assignment of Choice--building momentum on success
        Recapitalizing the USFK infrastructure and establishing a stable
    stationing environment enhances readiness, force protection, and
    overall quality of service. These key actions, along with equitable
    compensation for our servicemembers, are helping to make Korea an
    assignment of choice. This translates into increased personnel
    stability in Korea--fewer of our men and women are declining assignment
    to Korea, and higher percentages are choosing to stay in Korea for
    longer tours because of the improvements we've recently made. These
    improvements allow us to continue to recruit and retain the talented,
    motivated people who accomplish our mission in Korea; we need to
    continue to build on the momentum of recent successes.
        Our challenge to recapitalize the infrastructure is substantial.
    Our facilities are old--over one third of all buildings in the command
    are between 25 and 50 years old, and one third are classified as
    temporary buildings. These substandard facilities pose force protection
    challenges because they lack sufficient standoff and structural
    strength to withstand attack. Many of our single and married
    servicemembers continue to live in substandard base housing that is
    increasingly difficult and expensive to maintain.\13\ Others must live
    in expensive, densely crowded urban areas outside our installations,
    where force protection and safety are significant concerns. Along with
    the service components, we are working diligently to correct these
    deficiencies by 2009. We have a coordinated construction program--
    supported by our ongoing master planning at Camp Humphreys and Osan
    AB--that is executable with stable military construction funding under
    the Future Years Defense Plan (FYDP). We will continue to maintain
    existing permanent facilities through an aggressive Sustainment,
    Restoration, and Modernization program--funded with O&M accounts--while
    we move forward with our overall construction master plan. With your
    support, we will continue to improve living and working facilities in
    Korea.
    ---------------------------------------------------------------------------
        \13\ Currently 8,000 unaccompanied servicemembers live in
    inadequate government quarters. More than 1,300 of the 2,000 available
    family housing units in Korea do not meet United States government
    standards.
    ---------------------------------------------------------------------------
        Though there is more to be done, we have made progress. In 2003 we
    focused efforts at our southwestern hub located at Camp Humphreys and
    Osan AB. Figures 1 and 2 illustrate the modern facilities that you have
    made possible. Fifty-two newly constructed family housing units opened
    at Camp Humphreys, and we awarded contracts for an additional 48 units.
    We also converted an existing bowling alley into an elementary school
    that now serves 150 students. At Osan AB, United States MILCON funded a
    new dormitory that provides adequate housing for 156 servicemembers. We
    also awarded contracts for phase one of a three-phase program that will
    provide over 300 family housing units at Osan AB. You also authorized
    important provisions that extend the allowable build-to-lease period to
    15 years. These provisions, approving the supplemental authority for
    acquisition and improvement of leased military housing in Korea, will
    allow us to add an additional 1,500 build-to-lease family housing units
    at Camp Humphreys.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        We have made progress toward recapitalizing our infrastructure in
    Korea. To maintain momentum in correcting these deficiencies, we need
    stable military construction funding in the FYDP. Your support, along
    with the ROK's contributions under cost-sharing agreements, will ensure
    that we complete this infrastructure renewal program. The President's
    fiscal year 2005 budget request includes several projects that are
    important for United States Forces based in Korea. These projects are
    summarized in Table 1.

               TABLE 1--2005 KOREA MILITARY CONSTRUCTION PROJECTS
                            [In millions of dollars]
    ------------------------------------------------------------------------
           Project Description              Location       Program Authority
    ------------------------------------------------------------------------
    Family Housing Tower, Phase III   Osan AB............         $46.83
     (117 units).
    156 Person Dormitory............  Osan AB............          18.60
    144 Person Dormitory............  Kunsan Air Base....          18.55
    144 Person Dormitory............  Kunsan Air Base....          18.55
    Sewer System Upgrade............  Camp Humphreys.....          12.00
                                                          ------------------
      Total.........................                             $114.53
    ------------------------------------------------------------------------

        The additional family housing units at Osan AB will provide the
    necessary quality of life for servicemembers and their families. These
    facilities are a key part of the plan to provide more command-sponsored
    family housing to eligible servicemembers and will ensure that United
    States standards for space, safety, and force protection are met. The
    dormitory projects at Osan and Kunsan ABs will also improve the housing
    and quality of life for our unaccompanied servicemembers. These
    additions will provide adequate space in modern facilities for the
    individual servicemembers and allow them to live on our installations,
    thereby improving force protection and readiness. The sewer system
    upgrade project at Camp Humphreys is required to support the current
    population and the expected growth from our consolidation into hubs.
    This project is located on existing land granted for use by USFK, and
    will ensure compliance with health and environmental protection
    standards. Improving our infrastructure, along with expanded use of
    build-to-lease housing around our hubs of enduring facilities, will
    allow an increase in the number of accompanied tours, greatly improving
    quality of life across the services and attracting the high-quality
    personnel we need in Korea.
        We have moved toward equitable pay, long a concern for
    servicemembers stationed in Korea. Last year, servicemembers in Korea
    were authorized a cost of living allowance for the first time. This
    allowance has reduced the pay disparity and offset the rising out-of-
    pocket costs of serving in Korea. We are also working with the Services
    to implement the assignment incentive pay that you enacted. This
    legislation provides continued opportunity to reduce perceived pay
    inequities. On behalf of the people serving in USFK, I want to extend
    our sincerest thanks and ask that you continue supporting DOD efforts
    to provide equitable pay for the soldiers, sailors, airmen, and marines
    serving in Korea.
    In conclusion, I'd like to close with these thoughts:
        Northeast Asia will continue to grow in importance for the United
    States and our partners. The presence of United States Forces in Korea
    demonstrates our commitment to shared interests: regional peace and
    stability; free trade; and the spread of democratic principles. The ROK
    continues to be a reliable ally and partner in the region.
        United States Forces in Korea, along with our ROK counterparts, are
    trained and ready. We remain confident in our ability to deter and if
    necessary, defeat any potential North Korean aggression.
        United States Forces in Korea are transforming now. Our plan to
    enhance capabilities by modernizing equipment and implementing new
    operational concepts, shape roles and missions to optimize the force
    structure, and align the stationing plan for a sustainable presence has
    begun. Your continued support to these initiatives provides our
    servicemembers with state-of-the-art capabilities to deter and, if
    necessary, defeat threats in the Northeast Asia region.
        The ROK-U.S. Alliance has weathered challenges for over 50 years,
    and this partnership will continue to mature. Your investments in Korea
    have, and will continue to make a significant difference for our
    servicemembers and the stability of the region.
        You can be justifiably proud of all the soldiers, sailors, airmen,
    marines, and civilians in Korea who serve the American people. Their
    daily dedication and performance reflect the trust and support that
    you've placed in them.

        Chairman Warner. Thank you, General. Your enthusiasm and
    dedication to your assignment and to the welfare of your men
    and women come through. It is a difficult post to live in,
    having had some modest personal experience myself on that
    peninsula a half century ago, and I judge from your comments
    that the conditions have improved. So we will hear further.
        General Hill, sir.

     STATEMENT OF GEN JAMES T. HILL, USA, COMMANDER, UNITED STATES
                            SOUTHERN COMMAND

        General Hill. Thank you, Mr. Chairman, Senator Levin,
    distinguished members of the committee. I am honored for this
    opportunity to appear before you today to provide my assessment
    of Latin America and the Caribbean and of what the USSOUTHCOM
    is doing to advance United States interests in this very
    important region of the world.
        I am very appreciative of the support of the committee for
    the USSOUTHCOM, the soldiers, sailors, airmen, marines, Coast
    Guardsmen, and civilian personnel whom I am so privileged to
    command. They are fine men and women and are serving our Nation
    admirably.
        The security picture in Latin America and the Caribbean has
    indeed grown more complex over the past year, as the events in
    Haiti, Bolivia, and Venezuela amply illustrate. Deep-seated
    frustrations over the failure of democratic and free market
    reforms to improve the standard of living for all citizens are
    significantly challenging many of the region's governments.
    This frustration is exacerbated by endemic corruption and by
    the insidious impact on societies of the threats I addressed
    last year: narcoterrorism, urban gangs and other illegal armed
    groups, arms and human trafficking, and support to
    international terrorism.
        Unfortunately, as a consequence some leaders in the region
    are tapping into this frustration to move radical agendas
    forward and are manipulating democratic processes to diminish
    rather than to protect individual rights. Our country's focused
    support is critical to ensuring that the strong democratic
    tides of the past 25 years do not reverse their flow, but
    instead are strengthened and reinforced.
        Haiti's breakdown of law and order and its rising violence
    led to the voluntary resignation and departure of former
    President Aristide, a constitutional transfer of power, and the
    rapid deployment of the United Nations-mandated multinational
    interim force. Currently in Haiti the multinational force
    consists of 2,014 U.S. troops, 838 French, 500 Canadian, 329
    Chilean, deployed with the mission of setting the conditions
    for the follow-on deployment of a U.N. force in June. We are
    preparing for that follow-on force by stabilizing the security
    environment in Haiti, containing migration, and facilitating
    the provision of humanitarian assistance.
        I have been to Haiti twice since the crisis erupted. I will
    go back again on Monday. The first time I went was 3 days after
    the deployment of our forces, and again just last week. I was
    impressed by the positive change between my visits. The
    multinational force is performing well in a difficult and
    complicated environment. The troops in Haiti are progressively
    reestablishing the security and stability necessary for the
    interim government to function.
        I am particularly pleased by the seamless cooperation among
    our multinational force allies. Thanks to the quick response
    and meaningful contributions of our government, along with
    those of Chile, France, and Canada, our troops are working side
    by side with those other nations, bringing a new spirit of
    cooperation to the difficult task at hand.
        Despite the very complex security situation in the region,
    much is going well. Although there remains work to be done, our
    country's significant investment in Plan Colombia is showing
    substantial results. The Colombian economy is growing. The
    Colombian government has established a presence in all major
    municipalities. Major categories of criminal activity are down.
    Narcotics production is down. Demobilizations by the
    narcoterrorist organizations are increasing, as are desertions
    from their ranks. The Colombian military has grown into a
    professional, competent force that reflects human rights and
    the rule of law and has gained the strategic initiative over
    its narcoterrorist enemies.
        As a result of this substantial progress, a window of
    opportunity has opened in which the Colombian government has
    the potential to deal a decisive blow to the narcoterrorists.
    The Colombians have developed a campaign plan which takes them
    into the heartland of the territory controlled by the illegal
    armed groups.
        To provide the maximum amount of support to this effort,
    the administration has recommended that the congressionally-
    mandated cap of 400 military and 400 contractors be raised to
    800 and 600 respectively. This increase will allow us to
    provide the Colombians the greatest possible assistance and
    maximize their potential for success.
        I have worked closely over the past year with President
    Uribe and the leaders of the Colombian military. I have visited
    all corners of Colombia. I have seen first-hand the
    professionalism and increased capabilities of the Colombian
    military. I have been inspired by the dedication of the
    Colombian soldiers in their daily fight to defend their
    democracy against vicious narcoterrorists.
        It is vitally important that we sustain Plan Colombia's
    progress. As one of the oldest democracies in this hemisphere,
    a key trading partner and supplier of oil, a staunch ally, and
    only 3 hours from Miami, a stable, secure Colombia is important
    to our national security interests.
        In stark contrast to the situation 25 years ago, democracy
    is now the accepted model for governments in this hemisphere.
    However, transnational threats, poverty, and corruption are
    destabilizing governments and impeding the consolidation of
    democracy. The continued progress as a region of democracy and
    prosperity is fundamentally important to our national security.
        With very few resources and a modest presence, the men and
    women of USSOUTHCOM are working to further that progress and to
    ensure our Nation's security. We will remain steadfast in our
    efforts and look forward to your continued support.
        Thank you again for this opportunity to appear before you,
    and I look forward to your questions.
        [The prepared statement of General Hill follows:]
                  Prepared Statement by GEN James T. Hill, USA
                                  introduction
        Mr. Chairman, Senator Levin, members of the committee, it is my
    privilege to present the posture statement of the USSOUTHCOM. The men
    and women of our command are making enormous contributions to the war
    on terrorism and the defense of this country on a daily basis. Your
    soldiers, sailors, airmen, marines, Coast Guardsmen, and DOD civilians
    are working throughout the region to promote U.S. national security
    interests. Their work has done much to preserve stability and
    strengthen relationships with our allies. Simultaneously we are
    building a cooperative security community that will advance security
    and stability in the generation to come.
        The security picture in Latin America and the Caribbean has grown
    more complex over the past year. Colombia's considerable progress in
    the battle against narcoterrorism is offset by negative developments
    elsewhere in the region, particularly in Haiti, Bolivia, and Venezuela.
    These developments represent an increasing threat to U.S. interests. We
    face two primary types of threats in the region: an established set of
    threats detailed in previous years and a nascent set likely to raise
    serious issues during this year. On the traditional front, we still
    face threats from narcoterrorists and their ilk, a growing threat to
    law and order in partner nations from urban gangs and other illegal
    armed groups, which are also generally tied to the narcotics trade, and
    a lesser but sophisticated threat from Islamic radical groups in the
    region. These traditional threats are now complemented by an emerging
    threat best described as radical populism, in which the democratic
    process is undermined to decrease rather than protect individual
    rights. Some leaders in the region are tapping into deep-seated
    frustrations of the failure of democratic reforms to deliver expected
    goods and services. By tapping into these frustrations, which run
    concurrently with frustrations caused by social and economic
    inequality, the leaders are at the same time able to reinforce their
    radical positions by inflaming anti-U.S. sentiment. Additionally, other
    actors are seeking to undermine U.S. interests in the region by
    supporting these movements.
        These traditional and emerging threats are overlaid upon States in
    the region that are generally marked by weak institutions and
    struggling economies. This resulting frailty of state control can lead
    to ungoverned or ill-governed spaces and people, corruption, and
    clientalism. The militaries we work with in the AOR are feeling the
    brunt of both threats and weak governments, but for the most part have
    supported their respective constitutions, remained professional, and
    respected human rights. They will be under increasing pressure from
    these stressors over the next several years. Consequently, we must
    maintain and broaden our consistent military-to-military contacts as a
    means of irrevocably institutionalizing the professional nature of
    those militaries with which we have worked so closely over the past
    several decades.
        We are assisting our partner nations' efforts to address these
    threats and underlying structural factors through consistent, patient
    cooperation. We work closely with the interagency to build a coherent,
    long-term vision and to coordinate our efforts, but to realize that
    vision will require considerable time, energy, and resources. As in
    Colombia, the work will be hard and will require long-term dedication
    and commitment. The security, economic well being, and demographic
    fortune of our country is inextricably linked with Latin America and
    the Caribbean. The entire Americas, working as one, can confront these
    existing and emerging threats, and they can do so while providing for
    economic growth and opportunity. Consequently, this region of the
    world, despite all the other very real and pressing demands on our
    national attention and resources, requires increased attention in the
    coming year.
        To describe the current state of affairs in USSOUTHCOM, I will
    outline in detail the threats we are facing, both traditional and
    emerging. I will provide a regional assessment, with particular
    emphasis on the progress we are seeing in Colombia under the Uribe
    administration, followed by an assessment of our progress in the war on
    terrorism. Finally, I will address USSOUTHCOM's requirements.
                                    threats
        The narcoterrorists in Colombia remain the largest and most well
    known threat in our region and have continued their illicit activities,
    yet not without a price. All three narcoterrorist groups are named on
    the Department of State's list of designated foreign terrorist
    organizations: the Revolutionary Armed Forces of Colombia, or FARC; the
    National Liberation Army, or ELN; and the United Self-Defense Forces,
    or AUC. Most observers now understand that these groups are
    narcoterrorists rather than romantic guerillas crusading for the
    downtrodden. While a few might retain some of their founding ideology,
    by and large these groups consist of terrorists and criminals who
    operate outside the rule of law in pursuit of illicit profits rather
    than political revolution.
        The FARC still comprises the largest threat, with an estimated
    13,000-15,000 members. The FARC has continued to conduct terrorist
    activities in Colombia and still holds three Americans hostage. Despite
    their numbers, they have suffered many setbacks this past year, with
    the capture or elimination of a number of valuable leaders and front
    commanders. Most notably a high-level financier, Simon Trinidad, was
    captured by the Ecuadorians and turned over to Colombian custody. Over
    2,000 FARC members have demobilized since August 2002. The ELN, a
    smaller organization with an estimated 3,500 to 4,000 members, is
    declining in importance. There has been some progress in encouraging
    the ELN to demobilize via peace talks, although those who refuse may
    merge with the FARC. Much of the AUC, while still a threat and still
    heavily involved in narcotics trafficking, is in peace negotiations
    with the Government of Colombia. 10,000 to 12,000 members of the
    illegal self-defense groups are estimated to be involved in the peace
    process, though another 2,000 to 4,000 remain outside the process.
        The narcoterrorist influence is bleeding over into what we see as a
    second and increasing threat to the region: growingly sophisticated
    criminal gangs. While not all gangs are fueled by illicit narcotics,
    most bolster their criminality by drawing substantial support from the
    drug business. The World Health Organization has described Latin
    America as the world's most violent region based on the numbers of
    homicides per capita, surpassing even war-torn Africa. Homicides and
    violent crime take a direct toll daily on Latin Americans. There is
    another insidious second order effect. The Inter-American Development
    Bank has estimated that per capita GDP in Latin America would be nearly
    25 percent higher if Latin American crime rates resembled those of the
    rest of the world. Violent crime causes capital flight from within the
    country and stifles investment from outside the country. It literally
    takes money out of the pockets of those who need it most and most hurts
    those who have the least. This second threat faced by many Latin
    American countries is difficult and complex because it falls precisely
    on a seam between law enforcement and military operations. Latin
    American leaders need to resolve this jurisdictional responsibility
    issue to promote cooperation among their police and military forces
    while simultaneously restructuring their states' security forces.
        Beyond narcoterrorist and gang violence, branches of Middle Eastern
    terrorist organizations conduct support activities in the Southern
    Command area of responsibility. Islamic radical group supporters,
    extending from the Caribbean basin to the tri-border area of Paraguay,
    Argentina and Brazil, conduct fund raising activities. Terrorists who
    have planned or participated in attacks in the Middle East and the
    United States, such as captured high profile al Qaeda terrorist Khalid
    Shaihk Mohammed, have spent time in the region. Supporters generate
    illicit funds through money laundering, drug trafficking, arms deals,
    human smuggling, piracy, and document forgery. They funnel tens of
    millions of dollars every year back to their parent organizations in
    the Middle East, thus extending the global support structure of
    international terrorism to this hemisphere. Not surprisingly, Islamic
    radical groups, narcoterrorists in Colombia, and urban gangs across
    Latin America all practice many of the same illicit business methods.
        Radical populism is another emerging concern in the region.
    Populism in and of itself is not a threat. Rather, the threat emerges
    when it becomes radicalized by a leader who increasingly uses his
    position and support from a segment of the population to infringe
    gradually upon the rights of all citizens. This trend degrades
    democracy and promises to concentrate power in the hands of a few
    rather than guaranteeing the individual rights of the many. Anti-
    American sentiment has also been used to reinforce the positions of
    radical leaders who seek to distract the populace from their own
    shortcomings. Anti-American sentiment also troubles our partner nations
    as well, as elected leaders must take into account the sometime very
    vocal views of their constituents. The threats and trends in the region
    paint a negative picture in many regards and certainly bear close
    scrutiny in the coming year. We will maintain vigilance. We will also
    continue our work with partner nations and the interagency to shore up
    stability and promote increasing security cooperation.
                              regional assessments
    Andean Ridge
        Colombia is where the most is at stake. The United States made an
    enormous investment in the Government of Colombia 3\1/2\ years ago with
    our support to Plan Colombia. That investment is beginning to pay
    dividends. Under President Uribe, the Government of Colombia, with
    robust popular support, is making impressive progress in defeating the
    narcoterrorists and rejoining the ranks of peaceful, safe and secure
    states. I have been to Colombia 23 times since I took command, and I
    have seen progress on every visit.
        President Uribe is a unique leader who has galvanized the will of
    the people and motivated his armed forces. He has personally
    demonstrated that one individual can change the course of events.
    Without his personal leadership, energy, and dedication, I don't think
    the Colombians would have achieved the remarkable progress we have
    seen. Yet his personal charisma and drive only go so far, and he well
    knows it. That is why he is building the structures to sustain momentum
    and institutionalize success beyond that of his term and beyond that of
    Plan Colombia.
        The Colombian military has become much better and more aggressive
    in their operations against the FARC, the ELN, and the AUC. They have
    nearly doubled the number of narcoterrorists captured while also
    seizing the initiative on the battlefield. They have had increasing
    success against the enemy's leadership. Demobilizations are up, with
    some 3,500 members of illegal armed groups having voluntarily given up
    arms since President Uribe took office. There have been fewer terrorist
    attacks on the electrical grid, the oil pipeline, communications
    towers, roads, bridges, and towns. Cocaine eradication is up along with
    interdiction and seizures. Colombia has resumed a thoroughly vetted and
    robustly staffed Air Bridge Denial Program. Across the entire country,
    homicides, kidnappings, robberies, and thefts are down. Colombia's
    economy is growing as measured in its GDP, stock market, foreign
    investment, exports, and banking revenues. I am heartened by the
    progress the Colombians are making, of their own volition, and with our
    aid. We need to stay the course in our support of their efforts to
    ensure that the Plan Colombia dividend is paid in full.
        The Colombians are abiding by the norms of International
    Humanitarian Law in their struggle. The State Department has certified
    this performance. Under President Uribe's ``Democratic Security
    Policy,'' extrajudicial executions in 2003 were down 48 percent,
    assassinations were down 41 percent, homicides of trade unionists were
    down 68 percent and forced displacements were down 68 percent. None of
    the units U.S. forces have vetted and trained have been found to have
    committed human rights abuses. Alleged human rights abuses by Colombian
    security forces are now less than 2 percent of those reported and the
    institutionalization continues with the opening of Colombia's Armed
    Forces School of International Humanitarian Law, Human Rights, and
    Military Justice that teaches human rights and international
    humanitarian law to attorneys, commanders, officers, and sergeants. I
    am confident that President Uribe and the Colombian military have taken
    respect for human rights to heart, unlike their adversaries, who commit
    the vast majority of human rights abuses. In 2003, as members of the
    illegal armed groups demobilized, over 77 percent of those who did so
    turned themselves into government forces. If those demobilizing
    suspected they would be subject to torture and abuse, they would turn
    themselves into non-governmental organizations and the Church as they
    did in years past, before human rights became an integral part of the
    Colombian military's ethos. That professional ethos is also reflected
    in public opinion that now lists the Colombian military as the second
    most respected institution in the country just behind the Church. The
    Colombian military is at war, which it will win while fighting justly.
        Venezuela remains an oil rich nation that provides some 13 percent
    of oil imported into the United States. The domestic political
    situation continues to be exceedingly complex, and the prospects of the
    presidential recall referendum are still in considerable doubt.
    Venezuelan society is deeply polarized and will continue to be so as
    long as the Government of Venezuela continues along an authoritarian
    path. Well-organized street protests numbering in the hundreds of
    thousands occurred on a frequent basis over the past year.
        Bolivia faced significant turmoil over the past year. Bolivia has a
    very deep geographic divide between two parts of the country, the La
    Paz region and the lowlands around Santa Cruz, which is mirrored by
    deep ethnic and social divisions. There are legitimate and historic
    grievances, manifested partially in tension over indigenous traditions
    that revolve around growing coca in limited amounts as a part of their
    native culture. Yet the limited amounts never seem to stay limited, and
    the cocaleros who seek expanded rights to grow coca certainly envision
    the profits from illicit narcotics rather than the practice of ancient
    traditions. These cocaleros have found leaders who have tapped into
    indigenous and other social tensions. Indigenous groups, working with
    labor unions and others, mounted violent protests last October that led
    to the eventual resignation of then President Gonzalo Sanchez de
    Lozada. If radicals continue to hijack the indigenous movement, we
    could find ourselves faced with a narco-state that supports the
    uncontrolled cultivation of coca. Since his elevation to the presidency
    in October, however, President Mesa has been able to stabilize the
    country. Still, Bolivia bears very close scrutiny in the upcoming year.
        Ecuador has demonstrated over the past year that it has the
    political will to secure its border with Colombia and to fight drug
    traffickers. Despite limited resources and a vast expanse of thickly
    vegetated country that needs to be covered, the Ecuadorian military has
    placed many of its best troops on its northern frontier and has
    established cross-border communications with the Colombian military.
    Ecuador continues to host one of the USSOUTHCOM's Cooperative Security
    Locations (CSL) in Manta, which has been especially critical in
    providing coverage on the eastern Pacific vector of drug smuggling.
        In Peru, President Toledo suffers from very low popularity ratings
    despite a good economy. Peru's large indigenous population remains
    relatively politically inactive and has not been mobilized to the
    extent seen in Bolivia. Sendero Luminoso (SL) remains an ongoing
    problem. The Peruvian military has aggressively pursued them, and they
    do not possess the strength or capabilities they once displayed.
    Ominously, SL has now adopted the FARC model of protecting narcotics
    traffickers in exchange for funding. In a reassuring example of
    regional cooperation, the defense ministers from Peru, Colombia, and
    Brazil signed a three-way agreement to combat illegal drug trafficking
    in the Amazonian region on February 10, 2004.
    Caribbean
        Following the resignation and departure of former President
    Aristide, there was a constitutional transfer of power to the interim
    government in Haiti, and with it, an opportunity to move forward. With
    United Nations support and in conjunction with our partners, we have
    established the Multinational Interim Force, consisting of forces from
    the United States, France, Chile, and Canada. We are working to
    reestablish security and stability for the Haitian people until such
    time that Haitian institutions have been sufficiently bolstered to
    resume that task. This operation has had the effect of saving the lives
    of innocent Haitians, preventing a mass migration during a time of
    rough seas, protecting U.S. interests in the Caribbean, and fostering
    regional and international cooperation to assist a nation in need. Much
    work remains to be done, and we will continue providing our assistance
    to the Multinational Interim Force's efforts and to developing plans
    for a potential follow-on U.N. Multinational Stabilization Force.
        Beyond Haiti, the primary challenges in the Caribbean come from
    narcotrafficking, terrorism, document fraud, and corruption. Democratic
    institutions remain relatively immature, rendering many countries
    unable to police fully their sovereign territory, resulting in porous
    borders and coastlines and ungoverned spaces. Migration remains a
    concern should Caribbean governments be unable to meet the needs of
    their people. Additionally, violent crime has grown over the past
    decade, much of it related to narcotrafficking, arms trafficking, and
    money laundering. To meet these challenges regional governments are
    attempting to focus on cooperative efforts such as the Regional
    Security System, the Caribbean Disaster Emergency Response Agency, the
    Caribbean Information Sharing Network, and the U.S. Coast Guard's
    Caribbean Support Tender. A key element of USSOUTHCOM's efforts in the
    Caribbean is the uniquely focused Tradewinds exercise. Conducted
    annually, Tradewinds exercise objectives focus on combating
    transnational threats, counterdrug operations, and disaster
    preparedness.
        Aruba and the Netherlands Antilles continue active support of
    USSOUTHCOM counterdrug efforts with their respective CSL. Of all our
    allies in the Caribbean, the Dominican Republic has the strongest
    military and has often been the most supportive. Their military
    capability and political leadership allowed them to support
    multinational forces in Iraq with a battalion sized task force. The
    Dominicans will be key partners in expanding the Third Border
    Initiative to build a Caribbean zone of confidence. The Enduring
    Friendship initiative will help synchronize all maritime activities in
    the Caribbean, deny terrorist access, protect legal trade, and suppress
    illicit trafficking.
    Central America
        Democratic governance continues to be the accepted model throughout
    Central America and the region is generally pro-United States. Central
    American leaders have shown a commitment to free trade and open
    economies and have also begun laying the groundwork for greater
    regional integration. They are overcoming historical border differences
    and tensions in order to pursue regional economic and military
    integration. Honduras, El Salvador, and Nicaragua sent forces to
    support OIF. Current relations with Nicaragua are a testament to how
    much improvement has been made in just two decades with patient,
    cooperative efforts. Additionally, El Salvador provides USSOUTHCOM the
    use of Comalapa Airport as a Cooperative Security Location for counter-
    trafficking coverage throughout Central America, the eastern Pacific,
    and the western Caribbean. JTF Bravo in Honduras continues to provide a
    logistical support base to the critical humanitarian missions of the
    region, as well as to counter illicit trafficking operations.
        Despite progress, Central American countries lack resources and
    remain susceptible to the ills of narcotics and arms trafficking. This
    region is also a primary avenue for illegal migrants and drugs entering
    the United States. Especially troublesome is the growth in gangs and
    drug related crime we are seeing across Central America. Unemployment
    and poverty, together with a demographic surge in the younger
    population and thousands of leftover weapons from the wars of the
    1980s, make Central America a fruitful recruiting ground for organized
    criminals. Violence is a major problem in this area with local
    vigilantism taking the place of judicial systems that do not work.
    There are estimated to be at least 25,000 gang members in Honduras, El
    Salvador and Guatemala, the three countries where the problem is worst.
    There is also some evidence that many of those gang members have close
    connections with gangs in the United States, either from drug
    distribution networks or from immigration and re-migration to their
    home countries.
    Southern Cone
        The Argentine economic crisis has caused many to question the
    validity of neo-liberal reforms, manifested in the Buenos Aires
    Consensus signed last October by Presidents Kirchner and Lula and
    stressing ``respect for poor countries.'' Southern Cone countries,
    traditionally strong supporters of multilateralism and the United
    Nations, were also the most vociferous in opposition to OIF.
    Limitations related to the American Servicemember Protection Act (ASPA)
    have added yet one more complaint. Brazil continues along a moderate
    path but is suffering from narcotics fueled urban gang violence. The
    Brazilian minister of justice stated that violence in Brazil's three
    biggest cities costs $4.5 billion a year. Nevertheless, progress and
    stability in Brazil is not in question.
        We are maintaining strong military-to-military relations with the
    countries of the Southern Cone. USSOUTHCOM has developed relationships
    with the new Argentinean military leadership and expects sustained
    cooperation in the future. Cooperation with the Brazilian
    administration and the Brazilian military continues routinely. We have
    received good cooperation from Argentina, Brazil, and Paraguay in
    disrupting terrorist activities in the Tri-Border Area. A Chilean
    platoon and a Paraguayan platoon are serving under Argentine command in
    the United Nations Peacekeeping Operation in Cyprus, with additional
    military personnel from Bolivia, Brazil, Peru and Uruguay also serving
    with the Argentine-led force. Chile, the fourth largest user of the
    Panama Canal behind the United States, Japan, and China, took an active
    leadership role in the Southern Command sponsored Panamax exercise
    designed to guarantee the security of the Panama Canal. The Chileans
    rapidly deployed a force to Haiti during the recent crisis. We look
    forward to a growing and cooperative relationship with Chile and its
    armed forces.
                                war on terrorism
        Terrorists throughout the Southern Command area of responsibility
    bomb, murder, kidnap, traffic drugs, transfer arms, launder money, and
    smuggle humans. USSOUTHCOM gains actionable intelligence on these and
    other terrorist activities that is then used by U.S. law enforcement
    agencies and our partner nations to disrupt terrorist operations and
    means of support. To further these efforts, we train, equip, build, and
    exercise partner nation capabilities to control borders, eliminate safe
    havens, and project government presence. Our primary efforts are in the
    areas of improving Colombian military capabilities, conducting
    detention operations, improving interagency cooperation, resetting our
    strategic architecture, promoting security cooperation, and
    institutionalizing partner nation professionalism and human rights
    adherence.
    Colombia's Military Capabilities
        USSOUTHCOM assistance programs are helping Colombia develop the
    capabilities to achieve security and stability. Military training of
    Colombian units that are vetted for human rights abuses is a key
    enabler in their fight. In addition to working closely with the
    Colombian Ministry of Defense, Army, Navy, and Air Force, we developed
    over the past year a close working relationship with the Colombian
    Special Operations Command, the 1st Commando Battalion, the Lancero
    Battalion, and their urban counterterrorist unit. We assist in
    providing operational support and developing thorough logistics
    systems, with a particular emphasis on casualty evacuation. We continue
    training the Counternarcotics Brigade and its aviation units. The Plan
    Colombia helicopters have proven to be a major asset in the fight
    against narcoterrorism, and the procedures for coordinating their use
    have been optimized and institutionalized. As we look to the future,
    careful consideration should be given to the eventual nationalization
    of these assets, while maintaining and respecting Congressional intent
    in their provision. We work on riverine techniques with the Colombian
    Marines and assisted in the establishment of operationally focused
    Riverine Combat Elements. We assisted in infrastructure security
    planning, and ensured that all systems were in place to resume the
    State Department-managed Air Bridge Denial program. We are working
    closely with Colombian Military Intelligence to assist them in
    developing intelligence driven operations. We sent Planning Assistance
    Teams to support Colombian units in numerous locations throughout
    Colombia. We helped develop Civil Affairs capabilities that have been
    well used as the government reestablished its official presence in all
    municipalities. With funds made available from the original fiscal year
    2000 Plan Colombia emergency supplemental, we have helped the Colombian
    Ministry of Defense institute legal reforms through the creation of a
    Military Penal Justice Corps, similar to our Judge Advocate General's
    Corps. To provide for the long-term institutional health of the
    Colombian Army, we assisted them in establishing a Command Sergeants
    Major Academy to develop a robust non-commissioned officer corps.
    Finally, drawing on lessons learned in our own operations, we are
    assisting in Colombian efforts to strengthen interagency cooperation.
    Detention Operations
        In addition to its work in Latin America and the Caribbean,
    USSOUTHCOM has directly and actively supported the war on terrorism
    since January 2002 by operating a terrorist detention and intelligence
    operations facility at Guantanamo Bay, Cuba. Intelligence operations at
    Guantanamo have provided critical information regarding terrorist
    organizations' leadership, organization, finances, planned attacks,
    potential attacks, and other specific information that has thwarted
    terrorist activities. As Guantanamo operations continue, we will
    improve intelligence exploitation, detainee review and repatriation
    procedures, and quality of life for servicemembers. We are prepared for
    our role as host of military commissions.
    Interagency Cooperation
        JIATF-South continues to serve as a model joint, interagency, and
    multinational organization as it coordinates source and transit zone
    activities from Key West, Florida. With the proven nexus between
    terrorists, drugs, and arms trafficking, counter illicit trafficking is
    becoming an increasingly important expansion of counterdrug efforts.
    JIATF-South and the Joint Southern Surveillance Reconnaissance
    Operations Center successfully merged last July, with a gain in
    efficiency by concentrating the trackers and planners in one
    headquarters. In January JIATF-South hosted a successful interagency
    counternarcotics trafficking conference that included high-level
    Colombian participation and set the course for future operations.
        Responding to Secretary Rumsfeld's guidance to establish a Joint
    Interagency Coordination Group, USSOUTHCOM meets monthly to focus on
    the war on terrorism with representatives from the Department of
    Treasury, Drug Enforcement Agency, Department of State, Department of
    Homeland Security, the intelligence agencies, and DOD. The Joint
    Interagency Coordination Group is also a venue for sharing intelligence
    and effectively coordinating our regional counterterrorism efforts.
    Within the interagency terrorist financial designation process,
    USSOUTHCOM is partnering with the Department of Treasury's Office of
    Foreign Assets Control to assist in interdicting the flow of capital
    acquired through illicit activities.
    Strategic Architecture
        USSOUTHCOM serves as a model unified command with modest forward
    presence and ability to respond regionally. Over the past year we have
    relocated some of our components and will continue throughout this
    year. U.S. Army South (USARSO) relocated from Fort Buchanan, Puerto
    Rico, to Fort Sam Houston in San Antonio, Texas. Special Operations
    Command South is in the process of relocating from Roosevelt Roads,
    Puerto Rico, to Homestead, Florida. This move is in conjunction with
    the U.S. Navy's decision to leave Roosevelt Roads, which also involves
    Naval Forces South moving from that location to Naval Station Mayport,
    Florida. USSOUTHCOM, USNORTHCOM, and USPACOM successfully agreed to
    establish a Joint Operating Area (JOA) that gave JIATF-South the area
    responsibility in the eastern Pacific all the way to the California
    border. This JOA is just one example of combatant commands cooperating
    to resolve seam issues. Additionally, USSOUTHCOM has established a J-7
    directorate for transformation and is establishing a Standing Joint
    Force Headquarters (SJFHQ) in cooperation with Joint Forces Command.
    This prototype SJFHQs deployed from the headquarters for the first time
    to Soto Cano Air Force Base, Honduras, in January and conducted a 2-
    week long exercise with full connectivity to USSOUTHCOM in Miami.
    Overall, these changes in Southern Command's strategic architecture
    will allow us to prosecute the war on terrorism in a more effective
    manner.
    Security Cooperation
        USSOUTHCOM's security cooperation activities expand U.S. influence,
    assure friends, and dissuade potential adversaries. The overarching
    goal is to promote regional security and stability through training,
    equipping, and developing allied security force capabilities that
    improve competence and professionalism while underscoring respect for
    human rights. Command programs are also intended to strengthen respect
    for the rule of law, civilian control of the military, and support for
    democratic ideals. We do this not only because it is in tune with the
    highest values of the American people, but also because it is a
    strategic, operational, and tactical necessity. Security forces must
    earn the trust and confidence of their people before they can be
    effective. Only by respecting the law and the dignity of all the
    citizens they are sworn to defend can security forces hope to gain the
    respect of those they protect.
        We annually coordinate and direct more than 30 legal engagement
    activities among military counterparts, regional governments, and non-
    government organizations. Throughout the USSOUTHCOM area of operations
    we have advocated reform of military justice codes and procedures,
    education on human rights and law of war, and the inclusion of military
    lawyers in the planning and execution of military operations.
    Complementing this training are disaster relief programs to teach
    militaries how to respond to their civilian authorities when disasters
    occur. Fuerzas Aliadas Humanitarias is the cornerstone of this program
    and will be hosted by Panama this year. More than 20 nations will
    participate, including our regional partners.
        Beyond disaster relief, New Horizons exercises provide unique and
    rigorous training opportunities to engineer, medical, and civil affairs
    units. These activities hone U.S. forces' engineering and medical
    skills in challenging environments under conditions nearly impossible
    to replicate in the United States. Last year the New Horizon exercises
    completed 31 engineer projects consisting of schools, medical clinics,
    wells, and rudimentary road construction and repair. The 70
    humanitarian medical deployments treated more than 300,000 patients.
    During these deployments, our veterinary teams treated approximately
    57,000 animals in varying livestock categories, which contributed
    significantly to sustaining local economic health. Ecuador, Guatemala,
    and Honduras will host New Horizons exercises this year.
        The annual naval exercise, Unitas, is conducted throughout the
    region with significant participation by several countries. This year,
    Peru will host the Unitas Pacific Phase and the Unitas Amphibious
    Phase, while Uruguay is scheduled to host the Unitas Atlantic Phase in
    November. Central American nations will host several exercises this
    year to include Peacekeeping Operations (PKO) North that will focus on
    strengthening the peacekeeping skills and capabilities of the 25
    participating nations. All the Central American countries and the
    majority of Caribbean nations will participate. We will also conduct
    PKO South and Cabaas to strengthen the peacekeeping skills,
    cooperation, and capabilities of the rest of the region's military
    forces.
    Professionalism and Human Rights
        A number of countries in Latin America and the Caribbean have a
    history of military dictatorships, authoritarian governments, violent
    internal conflicts and rampant human rights abuses dating back to the
    1950s and into the early 1990s. Many countries in the USSOUTHCOM area
    of responsibility are dealing with the legacy of human rights abuses
    committed during military dictatorships by strengthening judiciary and
    democratic institutions and by cementing civilian control of the
    security forces. Since 1996, USSOUTHCOM has conducted the Human Rights
    Initiative (HRI), ``Measuring Progress in Respect for Human Rights,''
    focusing on developing regional standards for human rights programs in
    the military and security forces. The HRI is a major strategic enabler
    tool for USSOUTHCOM and is a key component of the Command's Theater
    Security Cooperation Plan. We also ensure that all units that receive
    U.S. security assistance are vetted for human rights violations in
    accordance with the Leahy Amendment.
                                  requirements
        As the war on terrorism progresses we will increasingly pursue
    operations of mutual interest with goals that increase interoperability
    with our allies. We will pool our resources to the extent possible, but
    we foresee additional threats to U.S. security interests that may
    require additional resources or the reprioritization of programmed
    funds. To reinforce success in Colombia we will address the current
    personnel cap. We also expect an increase in requirements for
    persistent ISR and additional stress on our theater communications
    architecture, as well as a requirement for the renewal of Expanded
    Authorities legislation.
    Colombia Personnel Cap
        The current personnel cap limits the U.S. presence in Colombia to
    400 military personnel and 400 contractors. We manage the cap on a
    daily basis, rigorously remain under the ceilings, and frequently must
    cancel or postpone planned personnel travel to Colombia, request
    aircraft to reduce crew size, create complicated work-around schedules
    for aircraft flights, or simply cut back on training. Part of the
    difficulty lies in the types of personnel that we have counted against
    the cap, which include, for example, the permanent party military group
    itself, those in aircraft flying over but not stationed in the country,
    and personnel who have completed their assignments but have not yet
    left the country. A review of whether such personnel should be counted
    would be warranted.
        The decision for the DOD and Department of State to seek an
    increase in the personnel ceilings is a change from our previous belief
    that we could continue our programs efficiently under the previous
    ceilings. The progress made by President Uribe and Colombia have led us
    to conclude that there is a real opportunity, with only a small
    increase in U.S. personnel, if we are to achieve our policy goals in
    Colombia. I would emphasize that we do not seek to change the
    prohibition on U.S. involvement in combat.
        To date the impact of the personnel cap has been small. In the
    coming year, however, as the Colombian Military conducts full-scale
    operations across the depth of the country, the personnel cap will
    begin to have a deleterious effect on the mission. While U.S. personnel
    will not be directly on the front lines with the Colombian troops, more
    training and planning assistance at a variety of headquarters is
    required since a greater portion of the Colombian Military will be
    directly engaged on a broader front in operations to defeat the
    narcoterrorists. We should reinforce success this year rather than
    constraining ourselves with a cap number that made sense at the
    beginning of Plan Colombia but has not been adjusted for the current
    and future situation on the ground. Consequently, the administration
    has requested an increase of the personnel cap to 800 military
    personnel and 600 civilian contractors in Colombia in support of Plan
    Colombia.
    Persistent Intelligence, Surveillance, and Reconnaissance
        We conduct varied detection and monitoring (D&M) operations that
    require a high state of readiness and a joint effort to link multi-
    intelligence collectors targeted against strategic, operational, and
    tactical requirements. This melding of organic and national collection
    resources will improve operations and fulfill the Quarterly Defense
    Review Transformation requirement for continuous and persistent ISR.
    Southern Command's role in Operation Enduring Freedom includes the
    employment of national, airborne, ground, and maritime ISR assets that
    are targeted against regional terrorist groups and transnational
    support cells. Their combined products create a common operating
    picture of regional activity that can be shared with our allies as
    appropriate. Still, the majority of assets available to us are focused
    on the tactical fight in Colombia and thus unavailable for other
    missions. A capability to support Colombia and our other areas of
    concern in the war on terrorism is essential to gain the situational
    awareness requirement to disrupt terrorist activity. When sufficiently
    funded, D&M programs provide a formidable capability to detect and
    monitor illicit trafficking of arms, drugs and other illegal activities
    that fuel terrorist groups. Overall, this capability further provides
    critical information used by the U.S. and host nations to effectively
    counter the expansion of narcoterrorism and international terrorism.
    Command, Control, Communications, and Computers
        Improving C\4\ architecture for fixed and mobile operations
    throughout the region has been a consistent priority, as outlined in
    previous testimonies. The current C\4\ infrastructure lacks the
    flexibility to execute the assigned mission due to over-reliance on
    inadequate commercial communications systems, limited communications
    bandwidth, and fragmented operations and maintenance support.
    Consequently, Southern Command is unable to effectively and efficiently
    support a counterdrug mission simultaneously with another contingency
    operation such as antiterrorism, noncombatant evacuation, migrant
    operations, disaster relief, or defense of the Panama Canal.
        Since existing military systems alone are insufficient, it is my
    intention to transform, expand, and maintain a cost-effective,
    efficient, centrally managed, and robust infrastructure that supports
    the Theater Security Cooperation Strategy. This strategy includes
    counterterrorism operations, regional engagement, crisis response, and
    counterdrug missions. We are partnering with DISA and the Department of
    State's Diplomatic Telecommunications Service Program Office to explore
    commercial alternatives such as fiber optic communication links. This
    effort shows promise for improving C\4\ effectiveness throughout the
    region.
    Expanded Authority
        In 2003 and 2004, Congress gave us expanded authority to use
    counterdrug funds for counterterrorism missions in Colombia because it
    concluded that there is no useful distinction between a narcotrafficker
    and his terrorist activity, hence the term narcoterrorist. This link
    between narcotics trafficking and terrorism in Colombia was also
    recognized in the National Security Presidential Directive 18 (NSPD-18)
    concerning support to Colombia. Operations today are more efficient and
    effective because our expanded authorities allow the same assets to be
    used to confront the common enemy found at the nexus between drugs and
    terror. Expanded Authority permits greater intelligence sharing and
    allows Colombia to use U.S. counterdrug funded equipment for
    counterterrorism missions. Expanded authority from Congress is
    essential to this command's ability to deal with narcoterrorists. We
    are requesting that Congress again pass expanded authority for fiscal
    years 2005 and 2006.
    Reprogramming of $50 Million
        We request congressional support of DOD reprogramming of $50
    million to support Colombia's campaign plan. Along with expanded
    authority and the increased troop cap, this reallocation of funds will
    synchronize U.S. Government efforts in assisting Colombia at this
    critical juncture in their fight against narcoterrorism.
                                   conclusion
        I'm proud of the effort the men and women of USSOUTHCOM have made
    over the past year. They have been able to protect our interests in the
    area of responsibility while the Nation's attention was focused
    elsewhere, and their dedication and focus has paid off, especially in
    Colombia where the Colombian government is making real progress against
    narcoterrorists and criminal groups. These successes, however, may not
    be enough to stem the growth of radical populism and popular
    dissatisfaction in some countries where reforms have failed to solve
    underlying social and economic woes. We continue to work to improve
    both the capabilities and professionalism of our partner nations'
    militaries, so they can maintain their own security and can assist in
    combating common transnational threats. Our partner nation military
    forces are currently under tremendous stress while simultaneously
    institutionalizing their roles in democratically elected governments.
    These forces, if properly trained and equipped, can ameliorate aspects
    of the struggles many countries face. We will continue to encourage
    professionalization through what we are doing in Colombia, and through
    what we are doing throughout the AOR with security assistance, theater
    security cooperation, and exercises. We will continue working
    diligently with the interagency to build the coherent long-term policy
    that will improve the security, and resulting economic and social
    health, of the entire Americas.
        I would like to thank the chairman and the members of the committee
    for this opportunity and for the tremendous support you have provided
    this command. USSOUTHCOM is a good investment of both your dollars and
    your trust. I can assure you that the men and women of the USSOUTHCOM
    are working to their utmost to accomplish their missions for our great
    country.

        Chairman Warner. Thank you, General Hill. Again, I have
    been privileged to work with you and your enthusiasm and
    commitment to this post come through very clearly.
        We will now proceed to a 6-minute round. I would like to
    start off again, Admiral Fargo, on the China-Taiwan situation.
    You are well aware, of course, of Congress' longstanding
    interest in this. We have the Taiwan Relations Act, and that
    potentially aligns us with trying to preserve the integrity of
    Taiwan as we know it today. The President has spoken very
    clearly and precisely on this.
        I was struck very positively by your observation--I believe
    I have it in mind--that the situation, you feel, is well in
    hand and it has not really changed in terms of military
    potential in some time now. Could you expand on that?
        Admiral Fargo. Yes, Mr. Chairman, I certainly can. As you
    remarked, the President has made it very clear that the United
    States opposes any attempt, by either side, to unilaterally
    change the status quo in the Taiwan Strait, and certainly it is
    our top goal--peace and stability in the Strait. That is the
    only way where the region will see the economic prosperity that
    everybody is looking for.
        I think my role is very clearly laid out in the Taiwan
    Relations Act. I have responsibility to continually assess and
    report to the Secretary and the President, to help Taiwan
    develop the capability to defend itself, and then, if so
    ordered, I have to make sure that our forces are ready and
    capable to defend Taiwan.
        So we are paying very close attention to this. As I
    mentioned to you yesterday, we do not see any indications, or
    any movements, that would cause us to believe that we have an
    imminent military crisis. They just are not there right now.
    Levels of activity are normal, the kinds of exercises you would
    normally expect for this time of the year.
        We are watching the Chinese military modernization very
    closely. Their economic success over the last few years, that
    growth of 7, 8, 9 percent, has certainly fueled a military
    modernization that is bringing to the People's Liberation Army
    modern ships and submarines and aircraft.
        Chairman Warner. Thank you. Your answer is very
    encouraging. Again I refer back to, I thought, a very clear
    statement by the President indicating our commitment. But I
    hope the political leadership on both sides down there do not
    allow the heat of politics, which all of us here on this side
    of the rostrum understand very clearly, to develop into some
    sort of a military confrontation. I thought the President spoke
    to that very clearly.
        General LaPorte, I see that you have with you a
    distinguished flag officer of the United States Marine Corps
    who, as I understand, has had a number of years of service.
    Would you introduce him to the committee, please?
        General LaPorte. This is Major General Timothy Donovan. He
    is my C-5. He has served in Korea 3 years. He is a tremendous
    asset to me personally, but to the command in general, and he
    is going to assume command of the Marines at Camp Pendleton.
        Chairman Warner. General, we welcome you and look forward
    to when your promotion comes before this committee. Three years
    of service you have put in on the Korean peninsula?
        General Donovan. Yes, sir.
        Chairman Warner. Quite a period.
        The incentive pay, General; it is a subject that you and I
    have worked on for the years that you have been in your post. I
    understand, from our conversation yesterday, that the Army has
    approved assignment incentive pay for soldiers who volunteer to
    extend their tour of duty in Korea. Those who are willing to
    remain in Korea receive an extra $300 a month.
        Do you have any assessment of how this is going to benefit
    your command? What is the status of the Air Force's decision
    regarding assignment incentive pay for airmen?
        General LaPorte. Senator, first of all, I would like to
    thank you personally and the committee for the tremendous
    support you have given the servicemembers in Korea relative to
    what was perceived as a pay disparity. Since I last appeared
    before you last year, the servicemembers serving in Korea have
    benefited tremendously, first of all with the increase in the
    family separation allowance from $100 to $250 a month. That is
    very much appreciated.
        Second, we were able to work very diligently to justify the
    cost of living allowance that servicemembers in Korea have
    started to receive about 8 months ago. Up to this point in
    time, Korea was the only place in the Pacific that was not
    receiving a cost of living allowance. That is not the
    responsibility of Admiral Fargo. That is the responsibility of
    my command to justify, and we have been able to do that over
    the past year. So the servicemembers are benefiting from that.
        Recently we looked very closely at the assignment incentive
    pay that you just mentioned. The Army has established a pilot
    program. We implemented it on March 12. The report I received
    last night indicated that at the closeout at the end of March,
    we have had 3,600 soldiers in Korea request this assignment
    incentive pay to either extend 1 year or 2 years in Korea.
        We think this is a tremendous vote of confidence in terms
    of the mission, the training that they receive in the command,
    and also an opportunity to make a few extra dollars for a
    difficult assignment.
        The status of the Air Force program: My understanding is
    that General Jumper approved the program this week and it is
    moving to the Secretary and then up to the OSD for approval,
    and I expect that will be approved shortly.
        Chairman Warner. Would you provide for the record, are
    other servicemembers of, say, the Department of the Navy,
    either naval or Marine Corps, serving in billets that would
    enable them to qualify under the Army's program?
        General LaPorte. The Navy has used the assignment incentive
    program very well over the past 2 years since they have been
    given the authority. I will provide you the details for the
    record, sir.
        [The information referred to follows:]

        Each of the Services is reviewing ways to improve servicemembers'
    quality of life incentives for personnel assigned to Korea, including
    overseas tour extension incentives. However, members of other Services
    are not eligible to participate in the U.S. Army's Assignment Incentive
    Pay Program.
        The U.S. Navy does have an assignment-related pay program, named
    the Assignment Incentive Pay Program, for eligible enlisted sailors;
    however, it is not currently applied to those enlisted sailors assigned
    to Korea because they receive Sea Duty Credit--for their service at a
    land-based Navy activity in Korea instead.
        The U.S. Marine Corps does not have an assignment-related incentive
    pay program. Headquarters, U.S. Marine Corps is currently evaluating
    its need for assignment-related incentive pay program for marines.
        The U.S. Air Force has established an assignment-related incentive
    pay program similar to the Army's program; the program has been
    approved by OSD and the Air Force is in the process of implementing
    their program.
        The U.S. Army's Assignment Incentive Pay Program is leading the way
    to provide Army units and organizations in Korea with options to
    increase servicemember stability and, at the same time, provide
    substantial fiscal savings to the Army by reducing the number of
    soldier and family member moves. This is a ``great news'' story, and I
    hope that the other Services will look at this program closely.

        Chairman Warner. I want to make sure, Admiral Fargo, that
    it is uniform for all service persons who have an assignment in
    that area.
        Admiral Fargo. Yes, sir.
        Chairman Warner. The Colombia troop cap, this is something
    that is being very actively considered. General Hill, the
    United States military presence in Colombia is currently
    limited to 800 personnel, 400 military and 400 contractors. The
    administration is asking for an increase in this troop cap. Can
    you give us your understanding of the justification for that
    and the size of increase that you think would be optimum?
        General Hill. Thank you, Senator. The troop cap issue and
    the request for an increase is directly linked to the great
    success that the Colombian military has had over the last 18
    months since President Uribe assumed the presidency in
    Colombia. He developed a strategic plan for the nation, the
    military developed a military plan for security for the nation,
    and they have now developed an operational plan to literally
    carry the fight to parts of Colombia where they have not had a
    presence for the last 15 or 20 years. They are going to take
    the fight to the enemy.
        When I was briefed on that plan, and I was shown the
    complexity of it, and I was shown the size of it, and they
    asked my support of it, what I saw was the need to increase our
    planning assistance teams, the need to help them logistically
    in terms of planning for sustained land combat, and also
    communications and intelligence.
        Chairman Warner. And transportation?
        General Hill. Transportation, to help them plan that
    transportation, yes, sir.
        As we began to look at the numbers, we saw quickly that we
    could not do that amount of work with them underneath the
    existing cap. What we have been doing over the last 6 to 8
    months is pulling some people out and putting some people in
    that are doing the more appropriate mission, and we have been
    managing the cap at exactly about the 400 level.
        This is an opportunity for us to see success of Plan
    Colombia. The United States Congress 3 years ago--we are in our
    fourth year of Plan Colombia--has put a lot of money into
    Colombia, about $2 billion. That investment is beginning to pay
    tremendous dividends, and we need to stay the course and part
    of that is to, in my view, allow me the flexibility to better
    assist the Colombian military in their undertakings.
        Chairman Warner. General, while we want to support that
    government in its effort to preserve freedom in its country and
    to stabilize the governmental situation, the drugs that emanate
    from that region cause a tremendous cost to this country in
    life, disease, and harm, and law enforcement and the like. Can
    you say that there is a direct correlation between that flow of
    narcotics from that region and this troop cap? In other words,
    will the troop cap hopefully further try to limit that flow?
        General Hill. In my view the answer to that question is
    yes, it will. The FARC, the AUC, and the ELN derive their
    resources to conduct their narcoterrorist activities out of
    narcotics. The region that the Colombian military is going into
    is one of the highest growing narcotics areas. We will continue
    to take down their ability to finance themselves, they being
    the illegal armed groups.
        We have seen over the last year the progress that the
    Colombian military has had. It has in fact played a significant
    role in making life much more difficult for especially the FARC
    to operate in their areas because of lack of resources.
        Chairman Warner. So there is a clear correlation and a
    clear benefit to our Nation to give this added support?
        General Hill. In my view, yes, sir.
        Chairman Warner. In your professional view. I thank you
    very much.
        Senator Levin.
        Senator Levin. Thank you.
        Admiral Fargo, in order to meet the current demand for
    forces in Southwest Asia the Marines decided to redirect to
    Iraq some of the battalions usually assigned to Okinawa. In
    your view, does that increase the risk that you will not be
    able to meet operational requirements?
        Admiral Fargo. Senator, we took a very careful look at
    this. In the first rotation of forces to Southwest Asia the
    Pacific was largely untouched. We did move the carrier Kitty
    Hawk into the Gulf, but it was immediately backfilled by the
    carrier Carl Vinson. This rotation we have moved forces and the
    marines off of Okinawa, those three battalions, are part of
    that.
        General LaPorte and I looked at this very carefully and
    felt that the risk that we would accept by moving those marines
    was both reasonable and prudent. In addition, the Navy and the
    Air Force have had the opportunity to pretty much reset. They
    have been able to come back and reconstitute, recock, if you
    will. We have the ability to use those forces to help mitigate
    that risk.
        Senator Levin. Admiral, this question is either for you or
    General LaPorte. It relates to our intelligence regarding North
    Korea's nuclear capabilities. I am wondering whether or not you
    believe that they have reprocessed all of the 8,000 fuel rods
    over the last 6 months?
        Admiral Fargo. I will give you my initial answer and I am
    sure General LaPorte can add to that. Senator, I do not know
    whether they have or not. I do not think we have enough
    intelligence to tell that.
        Senator Levin. General?
        General LaPorte. I would agree with that. Obviously, they
    have had the opportunity to in terms of time, but we do not
    have the intelligence that tells us they in fact have done
    that.
        Senator Levin. Now, how good is our intelligence generally
    relative to North Korea?
        General LaPorte. Senator, North Korea is a very tough
    intelligence target because of the closed nature of its
    society. They have worked very hard at countering technical
    intelligence means, such as using fiber optics, developing
    indigenous frequency-hopping radios. They have a tremendous
    number of underground facilities. So technical intelligence
    becomes problematic when you are addressing a target of that
    nature.
        From the HUMINT intelligence standpoint, because it is such
    a closed and controlled society, that is also challenging for
    us.
        Senator Levin. Do you disagree with that or do you want to
    add anything to that, Admiral?
        Admiral Fargo. No. I think it is a very tough target, as
    General LaPorte said. The society makes it tough to penetrate.
    We have had numerous conversations with our intelligence
    community and certainly we have laid out our requirements with
    them, and they are working on them and they are working on them
    hard. But it is a tough target.
        Senator Levin. General LaPorte, have you noticed anything
    different or unusual in North Korea's military posture,
    training, or operations?
        General LaPorte. Sir, since I last appeared before the
    committee I would say no, we have not. I agree with Admiral
    Fargo's assessment. The likelihood of war on the peninsula, my
    assessment is that it is low at this point in time. During the
    past 12 months there have been no tactical provocations along
    either the DMZ or in the west sea. Their conventional forces
    continue to train within seasonal norms that we have seen. They
    are just recently completing their winter training cycle, and
    there has been an average level of training that we have seen
    over the past 5 years.
        Senator Levin. The South Koreans seem to think that
    instituting a freeze, going back to the Agreed Framework as a
    starting point, is more desirable than the current situation
    where the 5-megawatt reactor continues to produce enough
    plutonium for about another device each year and where
    reprocessing has and may continue to occur.
        Do you have an opinion on the issue of whether or not it
    would be desirable to re-institute that freeze or do you think
    that we should basically insist the they dismantle everything
    up front? Do you have an opinion on that issue?
        General LaPorte. First of all, I would like to say that the
    United States many times is accused of unilateral action, but
    in this case the United States has been the driving force in
    developing the six party talks and getting other nations who
    have a vested interest in keeping the peninsula nuclear-free
    involved in the process.
        I think we need to have a very strong diplomatic effort
    that is backed up with a very strong military readiness
    posture.
        Senator Levin. On the specific issue, however, as to
    whether, since the South Koreans apparently believe that re-
    instituting a freeze would be a good starting point or an
    adequate starting point compared to the position of requiring
    the North Koreans to dismantle everything first, do you have an
    opinion on that issue?
        General LaPorte. The challenge always with the North
    Koreans is getting them to abide by any agreements that they
    make.
        Senator Levin. Either way.
        General LaPorte. They do not have a history associated with
    complying.
        Senator Levin. Admiral, do you have an opinion on the
    question I asked?
        Admiral Fargo. I think that General LaPorte has stated it
    very properly. Getting the North Koreans to abide by the
    agreement is the toughest proposition, and getting to the end
    state we are looking for, which is a nuclear-free Korean
    peninsula, is where we need to be.
        Senator Levin. Okay. General Hill, if we raise that cap
    that you and the chairman talked about, will that increase the
    risk in any way that U.S. troops will be drawn into combat?
        General Hill. No, sir. I am not asking for a change in the
    rules of engagement. I do not propose to put American troops
    into a combat situation, nor frankly would the Colombians like
    that to happen. The Colombians understand that this is their
    war, it is their war to win, and they are going about doing
    that.
        Senator Levin. So in your judgment specifically, if we
    increase the cap as you requested, that does not increase that
    risk?
        General Hill. I do not believe so, no, sir.
        Senator Levin. Thank you.
        Thank you, Mr. Chairman.
        Chairman Warner. Senator, your question is very important,
    but I think the record should reflect that our troops by virtue
    of their physical presence in that region are subjected to a
    fairly high degree of risk.
        General Hill. Senator Warner, that is correct, and if that
    is the context of Senator Levin's question----
        Senator Levin. I was talking about combat, whether they
    will be drawn into combat.
        General Hill. No, sir.
        Senator Levin. That is the risk I referred to. There are a
    number of risks that you are referring to, but I had limited
    the question to that risk.
        General Hill. But on the force protection issue, Senator
    Warner, we have a vigorous force protection policy in Colombia,
    and we work that every day very hard.
        Chairman Warner. I do not question that.
        General Hill. Yes, sir.
        Chairman Warner. But our attention is drawn this morning to
    a tragic picture of contractors and others. But at any moment
    elsewhere in the world our troops, while they are not in direct
    combat----
        General Hill. Yes, sir.
        Chairman Warner.--they are in harm's way. Let it be very
    clear.
        General Hill. Clearly.
        Senator Levin. I agree with that.
        Chairman Warner. Thank you.
        Senator Allard.
        Senator Allard. Thank you, Mr. Chairman.
        I want to thank all of you for your testimony today and
    thank you for your service to America and its citizens.
        The first question I want to direct to Admiral Fargo, and
    this deals with an issue that I have been working on through my
    office. Two Americans were murdered and several others were
    injured in Indonesia on August 31, 2001, when they were
    attacked as they were returning from a picnic. As a result of
    Indonesia's lack of progress in investigating this attack, last
    year I, along with Senator Russell Feingold, inserted language
    in the Fiscal Year 2004 Foreign Appropriations Act restricting
    funding for the International Military Education and Training
    to Indonesia until the Secretary of State has certified that
    Indonesia has made progress in its investigation and is
    cooperating with the Federal Bureau of Investigation.
        Are you satisfied with Indonesia's progress in
    investigating this attack?
        Admiral Fargo. Senator, I think we all recognize that
    Indonesia is a tremendously important place. This is the
    largest Muslim country in the world, over 200 million people,
    larger than Russia. Right now it is a moderate secular
    democracy and a relatively immature democracy. They are going
    to hold their first direct election for president in April. A
    lot of their institutions are immature and require a large
    degree of reform, and the TNI is one of those.
        The latest reports that I have from the country team on the
    TNI's cooperation with the FBI are actually very positive. They
    indicate that the cooperation has improved dramatically and the
    FBI is getting very close to being able to file their report.
    So I am encouraged by that.
        I have had direct conversations with General Sutarto, the
    Chief of Defense for Indonesia, about the importance of their
    full and open participation in this investigation and he has
    assured me he is going to provide his complete cooperation.
        Senator Allard. It sounds like you have emphasized the
    importance of finding those responsible and holding them
    accountable to Indonesian leaders and I appreciate your helping
    us out in that and being involved in that very crucial issue.
        The next one I want to address also to you, Admiral Fargo,
    and then also General LaPorte. It regards missile defense. In
    your prepared testimony you both underscore the problems and
    concerns with the growing proliferation of weapons of mass
    destruction and ballistic missiles. It is no secret that the
    North Koreans are assembling a significant missile inventory of
    great ranges and are one of the most aggressive proliferators
    across the globe.
        I am glad to hear in your testimony the added emphasis on
    ballistic missile defense programs. Could you share with us
    your respective efforts and progress in completing your
    concepts of operations and operator training activities for
    initial ballistic missile defense operations later this year?
    In particular, I would appreciate hearing any resource concerns
    you may have.
        Admiral Fargo. Yes, sir. Senator, let me start if I may. We
    think missile defense in the Pacific is tremendously important
    and of course on the national level also. It is one of my top
    three priorities that I have submitted in my integrated
    priority list.
        Right now we are moving to an initial capability this year.
    In the Pacific, that will involve the deployment of Aegis ships
    that provide a search and track capability and that will fit
    into the larger national architecture. We also think it is
    particularly important that we move ahead on theater ballistic
    missile and cruise missile defenses because of our clear
    responsibilities to protect our forces, our ships, and
    personnel ashore as well as our allies. So the early fielding
    of systems like the Theater High Altitude Air Defense system
    and expanding the Patriot PAC-3 capability, the fielding of the
    Navy's mid-course sea-based system and sea-based terminal
    system are particularly important to me to meet my
    responsibilities.
        Senator Allard. General?
        General LaPorte. Senator, let me just add to what Admiral
    Fargo has said. My responsibilities, obviously, are localized
    to the peninsula. During the past 12 months we have been able
    to significantly upgrade our Patriot capabilities on the
    peninsula as a result of integrating the PAC-3 missiles and
    technology into the forces that are currently on the peninsula.
        Senator Allard. Thank you.
        General Hill, there seems to be a growing trend among
    terrorist elements to partner with drug traffickers for
    financing their terrorism. This direct and growing linkage
    between the narcotraffickers and the global terrorists I think
    is becoming more of a direct threat to the United States. Is it
    time to start looking beyond just foreign military assistance
    programs and toward direct U.S. military action against these
    illicit partnerships?
        General Hill. Senator Allard, you raise a true concern of
    mine also. In my region, there is a growing Islamic community,
    some of it longstanding, some of it fairly new. They are
    involved in all manner of illegal activity, including
    narcotrafficking. There is a connection between many of those
    groups and Hamas, Hezbollah, and other organizations where
    illegal funds generated in our region pay for and help support
    international terrorism.
        We watch those groups very carefully in the region. To this
    point, we have never found, have not found, an operating
    terrorist cell. Were those to be found, then I would recommend
    appropriate action.
        Senator Allard. Thank you.
        Mr. Chairman, I see my time has expired.
        Chairman Warner. Thank you, Senator.
        Senator Reed.
        Senator Reed. Thank you very much, Mr. Chairman.
        Iraq has become a drain on our land forces of considerable
    scope. We have talked about the marines that have been deployed
    from Okinawa. The 25th Infantry Division has significant
    deployments into Southwest Asia. In addition, I assume that
    there are items of equipment that are in high demand, such as
    airlifters and other pieces of equipment. Beyond the units,
    there is a huge demand for special forces, special operators.
        Can you comment, Admiral Fargo and General LaPorte, on the
    effect on the Pacific of this commitment in Iraq? Do you have
    areas where you have less forces? Obviously you have less
    forces today, but that they are draining your ability to
    respond?
        Admiral Fargo. Certainly, Senator, we have less forces that
    are specifically based in the Pacific. As you point out, the
    deployment of the 25th Infantry Division to both Iraq and
    Afghanistan in this rotation as well as the marines--but of
    course, we source forces for all of our efforts globally from
    the entire capacity, really the immense capacity of the United
    States military. That is precisely what we are doing in these
    cases.
        As I responded earlier to Senator Levin's comment, we do
    have the ability to achieve comparable effects with other
    forces other than ground forces, such as the air that is
    provided by both the Navy and the Air Force, which are largely
    reset. So I think that, based on what we have available and our
    evaluation of the risk, we are in an adequate posture right
    now.
        Senator Reed. General LaPorte?
        General LaPorte. Senator, your concern is a concern that we
    need to stay focused on. I will tell you the forces resident to
    the peninsula have been minimally affected by the Iraqi
    operation. We continue to be trained and ready. I work very
    closely with Admiral Fargo in terms of the reinforcing forces,
    and we have exercised those reinforcing forces globally, not
    just in simulation, but in real life movements of those forces.
        I am confident that we have the capability as a Nation to
    reinforce the Korean peninsula if required.
        Senator Reed. Admiral Fargo, you pointed out that the
    administration is pursuing a diplomatic approach to the North
    Korean nuclear situation and that the military stands by as a
    complement or an exclamation point, if you will, to their
    diplomatic efforts. The North Koreans seems to be intransigent,
    noncooperative. Might that be a result of their simply looking
    around the Pacific and seeing the 25th in Southwest Asia, the
    Marines from Okinawa are now in Southwest Asia, even though you
    do have considerable air power? I guess the question would be,
    do you think our military posture is complementing effectively
    this diplomatic initiative?
        Admiral Fargo. Senator, what I have seen is that the North
    Koreans are complaining about our presence. As General LaPorte
    just mentioned, we just finished up our annual exercises,
    Reception, Staging, Onward Movement and Integration, Full
    Eagle, and Freedom Banner, on the peninsula. As General LaPorte
    mentioned, we used forces that were sourced globally for some
    of those efforts. We have maritime forces, a carrier strike
    group and an expeditionary strike group, that was fully
    involved in that effort. We rotate forces into the Pacific on a
    regular basis from the continental United States that maintain
    a very level and deterrent posture.
        The response we have gotten out of the North Koreans is one
    of: they notice that, and in some cases they object to it.
        Senator Reed. General LaPorte?
        General LaPorte. Senator, I would only add that my command
    is a combined command of both ROK and U.S., and the ROK
    military is an extremely capable military force. They are well-
    trained, well-equipped, well-led, and highly-motivated. So the
    U.S. and the ROK alliance together complement and allow us to,
    first of all, accomplish our deterrent mission; and second of
    all, to be ready to fight tonight if required.
        Senator Reed. Thank you.
        General Hill, following up in USSOUTHCOM, there have been
    stories about the drain of special operators from the Active
    Forces for private employment and other endeavors, and also
    obviously the demand in Southwest Asia for these special
    operators. Your Colombia operations seem to have a particular
    rationale for additional special operators. Will you find a
    problem there filling these additional slots that you
    requested?
        General Hill. No, sir. In context to the whole OPTEMPO-
    PERSTEMPO issue, which I am very sensitive to, not only just
    for Iraq but for other operations, most of the requirements and
    many of the requirements that I am going to fill in terms of
    upping from 400 to, as we see it, in 2005 about 726 people max,
    are short-term. They will be mostly filled from forces already
    assigned to me or from headquarters assigned to me. Some SOF,
    but in many regards not Special Operations Forces.
        Senator Reed. Thank you.
        Admiral Fargo, the Philippines has been a source of
    concern. Can you comment upon the situation now with the JI and
    their Abu Sayyaf operatives? What is the situation?
        Admiral Fargo. Sir, from the outset the Philippine
    government has provided superb support on the war on terrorism.
    They do have significant concerns, as we do, about the Abu
    Sayyaf Group and the Jemaah Islamiyah. The ASG was really
    pretty much a hostage for a ransom group that operated in the
    southern Philippines really in the archipelago.
        President Arroyo has recently stated that the JI is their
    top threat and concern. The Philippines has made some progress
    against the ASG. There were reports this weekend of the arrest
    of four to six ASG members and the recovery of some number of
    explosives. We are still trying to corroborate those reports.
        The JI are a regional concern. The region--the countries of
    this region, Southeast Asia, have cooperated very thoroughly,
    and I mean the Philippines and Indonesia and Thailand and
    Singapore, to arrest or detain some 200 JI members. But I think
    we need to be concerned about the JI. I am concerned about the
    potential for JI training in the Philippines and certainly our
    goal and our effort with the armed forces of the Philippines is
    to provide them the intelligence and the training and advice so
    that they can develop a long-term and sustainable counter-
    terrorist capability to deal with these threats.
        Senator Reed. Thank you.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator.
        The Senator from Alabama.
        Senator Sessions. Thank you, Mr. Chairman.
        General Hill, what is the troop strength you have under
    your command in SOUTHCOM?
        General Hill. Sir, I have about 1,200 people in my
    headquarters, and then my command--I derive forces from JFCOM.
    I am a force user. So I do not have a lot of people under my
    personal command.
        Senator Sessions. I think about Germany. We recently had an
    opportunity to be there and examine our strength there, and I
    think we are around 88,000 in Germany. I am not sure that we
    have any threats to United States interests of significance in
    Germany that require 88,000 troops.
        It is pretty clear to me that USSOUTHCOM has the potential
    to have some real problems and as part of our realignment and
    restructuring of our forces I am inclined to believe you should
    gain strength out of that process. Do you have any comment on
    that?
        General Hill. Senator, I think that the American people
    have gotten a big bang for their buck out of USSOUTHCOM for
    many years. I operate right now at .22 percent of the defense
    budget. We get a lot of goodness out of USSOUTHCOM for that.
        Senator Sessions. I think we are a bit of a Eurocentric
    government around here, but we have a big world. We have a lot
    of responsibilities in the world, and I do not expect that we
    can expect a lot of European help if there is a problem in
    South America. That is just the way it is. So I think we need
    to consider that.
        General LaPorte, I know you are restructuring your bases,
    thinking completely anew about how we ought to be positioned in
    South Korea. I visited very poor housing for some of the
    soldiers there, that had not been changed since we first came
    into Korea, and I know you want to change that, create better
    circumstances.
        I guess my questions would be: How is that going? Are you
    on pace? Do you have the funds to make that move? Will that
    allow you to reduce troop strength in South Korea without
    diminishing our capabilities?
        General LaPorte. Senator, our program in Korea is an
    enhance, shape, and align program. Over the past 2 years and in
    the next 3 years, we will make significant enhancements in our
    military capabilities. That runs the range from command and
    control all the way through missile technology to naval and air
    forces.
        So that helps tremendously in our ability to shape the
    force and align it into what we call two strategic hubs. One
    hub would be in the Osan-Camp Humphreys area that you visited
    and the other would be down in the southeastern portion of
    Korea.
        We are making progress. We have a long series of
    negotiations called the Future of The Alliance Study ongoing
    with the ROK. The ROK has agreed in general principle to the
    Second Infantry Division's relocation south of Seoul and also
    the relocation of forces that are in the greater Seoul
    metropolitan area. We have 7,000 servicemembers in 41 different
    locations in the metropolitan area. Those forces no longer are
    required in that area. They can be much more effective in an
    area south.
        So we are moving in that direction. The South Korean
    government has begun to purchase land. We have developed a
    master plan and have submitted it to the Department of the Army
    that will submit it to Congress here very shortly, a master
    plan for Camp Humphreys that will allow us to continue on. We
    continue to negotiate the timing of this move with the ROK
    government. So we are moving very aggressively on this project.
        The discussion of troop reductions has not entered into our
    discussions at this point.
        Senator Sessions. You do not expect, however, that you
    would need more troops, and is it possible that you could use
    less troops as you reconfigure your positions in Korea?
        General LaPorte. I think we have to take a look and assess
    our capabilities, not necessarily the number of personnel but
    the capabilities that we are able to put towards our deterrent
    mission and our warfighting mission.
        Senator Sessions. Thank you.
        General Hill, with regard to Colombia, I know you have made
    some comments about how the war is going against the
    narcoterrorists there, and I am very proud of the people of
    Colombia. I know they for many, many years tried talking. They
    tried working with the insurgents that threatened the oldest
    democracy in South America, and it did not work. They have, I
    think, pulled together effectively and have taken strong
    military action.
        Do you sense that they are continuing to pursue the
    advantages they gained? Are they losing momentum? Are they
    willing to see it through so that they can rid themselves of
    this terrible problem they have been having for so many years?
        General Hill. Senator, I think your opening statement was
    exactly on the mark. I think that what happened in August 2002
    when President Uribe was inaugurated, he was elected to that
    post by a people who had said to themselves, we are fed up with
    this. He maintains about an 80 percent popularity rate. The
    Colombian military is today the second most respected
    institution in the country, right below the church. They are
    respecting human rights in their way of dealing with their
    people. The people are responding.
        I believe that there is a momentum in Colombia today to see
    this through. There is a desire to see this through. They can
    travel on roads today they could not have traveled on 2 years
    ago. They like that. They have a sense of security that they
    did not have 2 years ago. They like that.
        So I think that there is a momentum that will continue
    beyond President Uribe, and they will see this through.
        Senator Sessions. General Hill, one of the things that has
    frustrated me is that a group out there continues to criticize
    the American military for training foreign militaries. I
    believe we have the highest standards in the world in human
    rights and civil rights. Are you telling me, it seems to me
    that you are saying, that the troops that we have helped
    train--we have not trained them all, but helped train--the
    values that we have taught are being applied and they are being
    respected by the population as a result?
        General Hill. I do not think there is any doubt about that.
    If the Colombian military was abusing its citizenry, they would
    not be the second most respected institution in the country.
        Another anecdote on that issue. Several years ago--for the
    last several years, as members of the FARC, the ELN, or the AUC
    have deserted or demobilized, they have almost always gone to
    the church or to a nongovernmental organization of some kind to
    turn themselves in--75 percent of those demobilized last year--
    about 3,000 folks--turned themselves in to the military. Now,
    if they feared that they would be abused by the military, they
    would not do that.
        In 2002 less than 3 percent of the human rights allegations
    in Colombia were against the military. In 2003 that number is 2
    percent, less than 2 percent.
        I feel strongly that they are on the right approach. In my
    view also, the Colombian military looks at it in two ways. It
    is a very practical solution to them because they know that
    they have to have the support of the people; and they will not
    gain that support if they are abusing their people.
        Senator Sessions. Thank you very much, Mr. Chairman.
        Chairman Warner. Thank you, Senator.
        Senator Ben Nelson.
        Senator Ben Nelson. Thank you, Mr. Chairman.
        Thank you for what you do on behalf of the American people
    and the world to make us safe and our democracies free. I have
    a couple of questions.
        Admiral LaPorte, it is good to see you again after having
    seen you twice last year in South Korea. This would really be
    to either you or Admiral Fargo. As you are making progress with
    the relocation of the troop locations in Korea, do you have any
    kind of a time line that you might expect to have the
    discussions finished with the South Korean government? I know
    you are working on the cost of the relocation because it seems
    that South Korea, the government there, would pick up a
    considerable amount of the costs of the relocation.
        Can you give us some idea of what kind of time frame
    progress might mean?
        General LaPorte. Yes, Senator. We have made significant
    progress to be where we are today. The Future Of The Alliance
    (FOTA) initiative was a 2-year program and we are 12 months
    into that program. We have had seven sessions and we have an
    eighth session scheduled next month. Our desire is to complete
    these negotiations so that legislation in the South Korean
    National Assembly can be presented after the 15 April elections
    when a new National Assembly takes office on 1 June.
        Senator Ben Nelson. Of this year?
        General LaPorte. Of this year, yes, sir. So we would like
    to complete these negotiations this year, have them approved
    and ratified by the National Assembly.
        Senator Ben Nelson. Can you give us some expectation of
    what the costs may be that we will bear versus the costs that
    their government would be expected to bear?
        General LaPorte. Senator, that is all under study right
    now, so I would hate to mention any numbers because I really do
    not have a good firm grasp on that.
        Senator Ben Nelson. But you are going to try to get a good
    deal, I take it?
        General LaPorte. Yes, Senator.
        Senator Ben Nelson. Okay. Good luck with the discussions
    and negotiations.
        Anything further, Admiral, that you might want to add to
    that?
        Admiral Fargo. The only thing I would add, Senator, is that
    I think, as General LaPorte said, the South Koreans are going
    to pick up a very significant portion of these costs. There
    will be some military construction costs to us, but I think it
    will be on locations that will facilitate our enduring presence
    on the peninsula, and I think strategically that is absolutely
    where we want to be.
        Senator Ben Nelson. Then with respect to North Korea,
    because the lack of intelligence is so obvious in dealing with
    the North Korean nuclear activity, is it safe to say that over
    the last year or so that it is very likely that they could have
    increased the use of those 8,000 rods by making them into
    significant nuclear potential devices?
        General LaPorte. Senator Levin in his opening comment
    really gave a great synopsis of that process. The answer is: it
    is possible.
        Senator Ben Nelson. Well, likely?
        General LaPorte. But we do not know, Senator. We just do
    not know.
        Senator Ben Nelson. But because we do not know, we also
    have to assume that it is likely that they have done that,
    because it would be consistent with what they have been doing
    to become a fairly significant one-stop shop for technological
    and weapon-grade equipment; is that fair?
        General LaPorte. That is a fair assessment, yes, sir.
        Senator Ben Nelson. That is why last year I said that we
    ought to stop debating and talking about whether we are going
    to talk and propose they--and this is for the diplomacy side,
    not the military side. But it seemed to me that we--and I
    developed a simultaneous model, where we would begin mutual
    talks with mutual agreement, that we would agree during the
    talks not to take action against them if they would stop in
    place and begin to talk about reducing their nuclear activity
    and their nuclear stock.
        I am worried that the time that continues to go on while
    talking about talking is occurring, that we are losing ground,
    that the potential is for them to increase their activity,
    although I applaud the fact that the Chinese government is now
    engaging in some of those conversations. But I am very, very
    much concerned about their expanding their ability because of
    their lack of a significant economy outside of selling
    technology to increase the shelf stocks, if you will, for those
    who might otherwise come buy and purchase what they have to
    sell.
        Let me ask as it relates to Colombia, General Hill. In
    2001, I think it was, a couple of my colleagues, Senators
    Nelson, Reed, Levin, and I visited Colombia and USSOUTHCOM when
    General Peter Pace was the commander. I notice that we feel
    like we are making some true progress with respect to the
    narcotrafficking. I have heard from those who are involved in
    dealing with the problem of methamphetamine use in the United
    States that maybe part of the progress is because there is less
    demand, maybe less demand for Colombian product, based on the
    fact that there is a growing demand for meth here in the United
    States.
        Do you have any thoughts or any knowledge of that?
        General Hill. Senator, I would defer on that to experts on
    meth use in the United States. But if I could, just one point
    on that. Let us just say that the hypothetical number is about
    900 metric tons of cocaine that are generated in the Andean
    region every year. We do not know exactly how much comes to the
    United States, but about 550 metric tons begin to make their
    way to the United States. We interdict anywhere from 150 to 200
    metric tons. That means that 300 or so tons get in the United
    States.
        But if the United States consumers stop doing cocaine
    tomorrow afternoon, there would still be a huge market for
    cocaine in the world.
        Senator Ben Nelson. In the world, yes.
        General Hill. In the world. That would still lead to
    destabilization in the region, and we have to go after that
    because that affects us.
        Senator Ben Nelson. I am not going to suggest for a minute
    that we abandon Plan Colombia, because I think it is of course
    a very important part of dealing with narcotrafficking. But it
    did strike me as sort of at least ironic that the drug of
    choice might move from one to the other, which could affect
    some production in Colombia.
        General Hill. I do not think there is any doubt about that,
    that there is a growing market for methamphetamines, there is a
    growing market for heroin, and that is cutting into the market
    for cocaine, along with our efforts to counter it.
        Senator Ben Nelson. It does seem ironic and perhaps it is
    poetic justice for the production of that narcotic in that area
    by those narcotraffickers.
        General Hill. Yes, sir.
        Senator Ben Nelson. Thank you, Mr. Chairman. I appreciate
    it.
        Chairman Warner. Thank you, Senator.
        Senator Bill Nelson, it is your turn.
        Senator Bill Nelson. Is it my turn? Well, bless you. I
    defer to my senior Senator so that he can go. Oh, no, I insist.
        Chairman Warner. The distinguished Senator from Hawaii.
        Senator Akaka. Thank you very much, Mr. Chairman.
        I want to add my welcome to our witnesses and tell you that
    we are very proud of what you are doing and what our troops are
    doing outside of our country.
        I want to follow up on the discussions with Senator
    Sessions and Senator Ben Nelson on the status of overseas
    basing strategy, basing strategy that was being developed by
    the Joint Chiefs in cooperation with the Under Secretary of
    Defense for Policy. This question is primarily to Admiral Fargo
    and General LaPorte. Has DOD decided which installations in the
    Pacific region we intend to make our enduring bases? Can you
    tell this committee what is the status of our discussions with
    the host nations, such as Korea and Japan? Have we reached
    agreement with them on long-term basing of our forces in their
    country?
        As a part of this global basing strategy, will DOD be
    seeking to base our forces or build any new facilities in the
    Pacific region in countries where U.S. forces are not currently
    stationed? If so, what would be the financial impact? The
    comment was made here that South Korea is picking up a lot of
    the costs of relocation there.
        So will you please give me your views on these? Admiral
    Fargo?
        Admiral Fargo. Thank you, Senator. To answer your question
    directly, these processes are still ongoing with our good
    friends and allies in the Pacific. We have very solid
    processes. General LaPorte alluded to one of them, the FOTA
    initiative with the Koreans. We have a similar process with the
    Japanese called the Defense Policy Review initiative. Of
    course, we have arrangements with Australia, another treaty
    ally, through the Australian-U.S. ministerial where we go
    through and collaborate with them to work through these
    particular issues.
        I think what is clear is certainly the need to transform
    and to improve our posture and footprint. I think this is well-
    recognized. I think we have also settled on some pretty clear
    principles to move forward with. First and foremost, these
    alliances that we have in the Pacific are tremendously
    important to us and have been the basis for our security for
    the past 50 years, the alliances with Japan and Korea and
    Thailand and the Philippines and Australia. They are very
    important and we are not going to do anything to diminish those
    alliances because of their importance.
        We are going to move forward with our allies and our
    partners in close consultation. That is a key principle. We are
    also going to take into account the changes in capability. Our
    capability has changed markedly in recent years and you
    recognize that in terms of speed and precision. But our allies'
    capability has also changed remarkably and they are much more
    capable and much more professional than they were say 15 or 20
    years ago.
        We have to produce a posture that can deal with the
    uncertainty in the world and the changed global threat
    spectrum. We have to make sure that we focus globally, that we
    are not just looking at this regionally, that we are looking at
    how the Pacific fits together with the CENTCOM, and also how it
    fits together with the European Command. So we are going to
    take a global look.
        Then the last point that I would mention is we have to make
    sure that our forces are immediately employable, because we
    recognize that warning is reduced and we have time lines in
    this world where speed is particularly important. So forces for
    immediate employability are also key to our strategy.
        So we are going to move ahead on that basis. We recognize
    that the Asian-Pacific region is tremendously important to the
    future. If you just look at Northeast Asia alone, it is some 44
    percent of the gross domestic product of the world. Certainly
    the future of Asia is very bright and our security concerns in
    Asia are preeminent.
        Senator Akaka. General LaPorte?
        General LaPorte. Senator, I would just reinforce what
    Admiral Fargo has said. Korea is very important to the
    stability of Northeast Asia. Our enduring presence is going to
    be there for many, many years, to include after possible
    reconciliation with North Korea. We have the mechanisms with
    the land partnership plan and the FOTA Initiative to address
    the issue of consolidation and reorganization of our forces in
    Korea. We are aggressively pursuing that plan.
        Senator Akaka. To all of you, and I would like to get your
    views on it: The Navy's new Fleet Response Plan (FRP). As I
    understand it, one of the goals of FRP is to reduce continuous
    presence in various areas of responsibility and instead provide
    naval forces on a surge as-needed basis. This should allow the
    Navy to achieve some savings, but it seems to me that there are
    also some potential down sides. For example, it may decrease
    opportunities for low-level engagement activities, and it might
    mean that units have fewer opportunities to conduct training in
    a variety of different locations so that training is less
    scripted.
        In a sense, each of you is a customer of the Navy. Could
    you each please give me your views on what you think the impact
    of the FRP will be in your theater and whether you think some
    of the possible negative consequences I can imagine might in
    fact come to pass? Do you have any concerns about the ability
    of the Navy to respond quickly enough to possible crisis if it
    reduces its forward presence? Finally, do you have any concerns
    about extending FRP to the Marine Corps?
        Admiral Fargo?
        Admiral Fargo. Senator, I see the FRP as a positive
    initiative, a very positive initiative. I do not see it
    diminishing our forward presence. In fact, I think it is going
    to complement those forward forces that we have right now in
    the western Pacific.
        The way the FRP is going to work as I understand it is it
    is going to make better utilization of the capacity that we
    have right now. We are going to change the maintenance and
    training of those carrier strike groups and expeditionary
    strike groups such that we will have six carriers available
    within 30 days, so that we can respond with greater capacity
    more quickly.
        It will still require the movement of these carriers into
    the region at appropriate times and on a pretty regular basis.
    I think the CNO calls it presence with a purpose, which I think
    is good. As we will see this summer, we will move a carrier
    from the West Coast into Northeast Asia, into the central
    Pacific, and we will meet a lot of those requirements that you
    talked about: making sure that our theater security cooperation
    plan is well-resourced, making sure that we are sending the
    right signals to our allies and friends, making sure that we
    are doing the kind of training, not only with our joint forces,
    but also with our allies, that will ensure that our collective
    readiness is improved.
        Senator Akaka. General Hill?
        General Hill. Senator Akaka, USSOUTHCOM has had a
    longstanding exercise called Unitas. That is a naval exercise
    on both the Atlantic and the Pacific sides of the region. That
    program continues as we speak. We are also engaging our
    regional partners in an exercise called Enduring Friendship.
    More than an exercise, it is in fact an operational training
    event inside the Caribbean, and we will expand that later.
        Finally, what I would say to you is that we are engaging
    the navies of our region with my naval component in a true
    regional manner. I will point to one exercise we did last year.
    The Chileans are the fourth largest user of the Panama Canal,
    and I asked them would they like to help in the defense of the
    Panama Canal? They responded: Absolutely. So we ran an exercise
    last year on the Pacific approaches to the canal with the
    Chileans, the United States Navy, and the Panamanian naval
    forces. That exercise was a counterterrorism exercise.
        That will expand this year to nine nations operating with
    the Panamanians as we collectively work to ensure the defense
    of the canal.
        Senator Akaka. General LaPorte?
        General LaPorte. Senator, in the FRP, as other plans, I
    look at it through an availability of warfighting capabilities
    lens, because I need to be prepared to fight immediately. I am
    confident that the Navy can provide these capabilities in the
    times that would be required, both in a deterrent role and also
    in a warfighting role. So I support Admiral Fargo's position on
    this.
        Senator Akaka. Thank you very much, and I thank my friend
    from Florida for the time.
        Thank you, Mr. Chairman.
        Chairman Warner. Senator Bill Nelson.
        Senator Bill Nelson. Mr. Chairman, one of the delights of
    your committee is having the opportunity to visit with the
    commanders, in this case combatant commanders, as I have
    visited with all three in their headquarters. Indeed, we can be
    very proud of them. So it is a pleasure.
        Chairman Warner. Senator, I would like to thank you. You
    have been able to find the time to travel to a number of places
    in the world, by and large alone, to carry out your oversight
    responsibilities. I thank you.
        Senator Bill Nelson. I am trying to next week as well if I
    can get Powell Moore off his duff and find me a military
    aircraft so I can get into the Dominican Republic and also into
    Haiti. [Laughter]
        Chairman Warner. I do not want to get into this dogfight.
    [Laughter.]
        Senator Bill Nelson. I would like in a more secure
    environment, Admiral, to discuss with you the question of North
    Korea having shot an intercontinental ballistic missile over
    Japan and what you think their intentions are; and, General
    Hill, to follow up with you after--we did an extensive trip,
    Mr. Chairman, throughout Latin America back in December--
    following up regarding the tri-border region and what you see
    there. I want to make the committee aware that we have to be
    concerned about terrorism coming out of Central Asia and the
    Middle East, through Africa, and now into Latin America.
    General Hill and I were concentrating on that in several areas,
    particularly the tri-border region.
        But also, in a closed session, if you would also bring me
    up to date with the three Floridians that are held as hostage
    somewhere in the jungles of Colombia.
        But let me start on the record here in the public session.
    There is a rumor going around that Secretary Rumsfeld wants to
    combine USNORTHCOM with USSOUTHCOM. Of course, I asked this of
    the combatant commander of USNORTHCOM. What you can say and
    what you cannot say, I will respect that, but I will just give
    you my two cents as long as we are here and then whatever you
    can say I would like for you to say for the record.
        This USSOUTHCOM is not only in need of a military
    commander, but the USSOUTHCOM, as evidenced in General Hill and
    General Pace before him, has to be a diplomat and has to engage
    almost on a daily basis with the heads of government of all
    these countries to protect the interests of the United States.
    I just do not see how we combine a USNORTHCOM, if there is
    anything to that rumor--and I hope there is not--with the
    USSOUTHCOM.
        But General Hill, say whatever you can for the record.
        General Hill. What I ought to ask is, what did General
    Eberhart say, but I will not do that.
        My view on this, Senator Nelson, is that it is under study
    and advisement. We are conducting the study and will give an
    honest appraisal to it. But all of the points that you just
    said about USSOUTHCOM are strong points.
        Senator Bill Nelson. It might be of interest also for me to
    just note for the record, Mr. Chairman, that, interestingly, as
    General Hill and General Pace before him conduct their
    activities, and where it is necessary for them to see so many
    of the elected heads of government and other cabinet members,
    interestingly the place of easiest destination for all of those
    world leaders is not somewhere in Latin America. Because of the
    flights, it is Miami, Florida, and indeed, that is where we
    have our headquarters of USSOUTHCOM.
        Chairman Warner. Senator, I think that this matter has not
    come before the committee, but it appears to me that, just out
    of the profound respect that we have for the Central and South
    American countries and given the volume of leaders that you
    have to deal with and the fact that in my judgment USNORTHCOM
    has a very full platter right now, that I think it would be
    well-advised to leave things status quo for the present time.
        Senator Bill Nelson. Mr. Chairman, those words are golden,
    and those will be duly noted.
        General Hill, in Haiti do you have enough operations and
    maintenance resources for the ongoing operations?
        General Hill. I do, Senator Nelson.
        Senator Bill Nelson. How long do you expect this operation
    to last?
        General Hill. The operation that we are conducting right
    now by U.N. mandate is to accomplish three tasks: to stabilize
    the country for a follow-on force; to work with repatriation
    and migration; and to assist in humanitarian assistance to the
    country. In my view, we are accomplishing all of that with the
    force that we were given. The U.N. mandate says right now that
    there will be another vote within 30 days to establish the
    longer force. We are to be there for 3 months until the follow-
    on force comes.
        I think that that is a doable issue. I met 2 weeks ago with
    the U.N. assessment team in Port au Prince and we all believe
    that that is a doable operation.
        Senator Bill Nelson. So in 3 months what you envision, do I
    understand, is a replacement of these existing U.S., French,
    Canadian, and Chilean troops by some other international team?
        General Hill. Yes, sir. The U.N. will pass--is supposed to
    pass another resolution, and I suspect that they will, for a
    follow-on force. Then the U.N. will organize that follow-on
    force around participating nations, and that force can be
    anywhere from 3,500 to 6,000. I think that that will be about
    the size of the force that they will generate.
        Senator Bill Nelson. Does this committee need to take note
    of any of the terrorist and narcotrafficking that is going on
    in Colombia that might be seeping into Venezuela?
        General Hill. The borders of all the countries that border
    Colombia are porous. The most porous of those borders is the
    Venezuelan border, and the Colombians have let it be known in
    strong terms, at the presidential level and at the military
    level, that the Venezuelans need to do more on their side of
    the border, and they need to.
        Senator Bill Nelson. Are we seeing any of the kidnapping
    that has been in Colombia start moving over into Venezuela?
        General Hill. Sir, there has always been not only FARC but
    ELN and AUC presence in the Venezuelan side of the border, and
    they go back and forth with essentially impunity into Colombia.
    Kidnapping does in fact take place on both sides of the border.
        Senator Bill Nelson. We have spent, as you stated in your
    testimony, billions of dollars down in Colombia. State again
    for the record whether or not you think that with our help that
    the Colombian government is winning the war against FARC?
        General Hill. I believe that the Colombian government has a
    strategic momentum against all the illegal armed groups, in
    particular the FARC. I believe that they have done it on the
    battlefield and they have also done it with the will of the
    people. They have--the phrase I use sometimes is they have
    turned the corner. How far around that corner they have gone, I
    am not sure. Can they be kicked back? Yes, if they do not
    sustain that momentum and, frankly, if we do not sustain our
    momentum.
        Senator Bill Nelson. In these upcoming elections in the
    Dominican Republic that we are worried about some questions of
    honesty in the elections, do you have a force structure that
    you can call on if chaos were to erupt there or, for example,
    in Venezuela; where the interests of Americans were suddenly
    threatened, that you would be able to get your hands on the
    assets to respond to that?
        General Hill. We very quickly put in a Marine Forward Area
    Support Team into the embassy in Haiti, in a matter of hours,
    to bolster the Marine Force defending the embassy in Haiti. We
    were able to put in Marines and then follow-on forces from the
    French and the Chileans within a matter of 24 hours into Haiti.
    There is no doubt in my mind that we can respond in my area if
    the United States administration wants to do that.
        Senator Bill Nelson. One thing that I was surprised, Mr.
    Chairman, to learn is that we have quite a number of U.S.
    troops in Honduras. Why do you not share with the committee the
    force that is there and what their mission is?
        General Hill. Sir, we have about 600 Americans at Soto
    Cano, Honduras. They have been there for many years and their
    mission is to maintain an operating base with the Honduran Air
    Force to facilitate humanitarian assistance down in the region
    and to provide assistance to law enforcement in the conduct of
    illegal--or in the conduct of drug busts.
        I am working on it with them and the militaries of the
    region, to develop at very little cost a regional training
    center so that the Central American militaries can come
    together in even more meaningful ways as a regional force, vice
    simply acting in their own stead.
        Senator Bill Nelson. Thank you, Mr. Chairman. I would like
    in a more secure environment also--every Floridian, indeed
    member of this government, ought to be concerned about events
    occurring in the Caribbean that would cause a mass migration as
    we have seen in the past from Cuba, also from Haiti. The plans
    that you have on the shelf coordinated with the Department of
    Homeland Security, I would like for us to discuss that.
        Thank you, Mr. Chairman.
        General Hill. Senator, I think you and I are scheduled to
    meet right after this, and I will be happy to go over both
    those points with you.
        Chairman Warner. I think that would be very helpful because
    at the moment I do not believe we will--we are going to start
    voting at 12:00 and there would be some difficulty trying to
    have an additional follow-on.
        Senator Pryor.
        Senator Pryor. Mr. Chairman, thank you.
        General Hill, I have a Bloomberg News report from about a
    week ago where it talks about us increasing our troops and
    contractor presence in Colombia. I had a couple questions about
    that, and these are follow-ups to the chairman's questions
    earlier when he was asking about those. With regard to the
    troops and the contractors there, the first question I have is
    what do the contractors do and how does that differentiate from
    what the troops do?
        General Hill. Sir, the contractor support in Colombia,
    working mostly for the embassy and the Department of State, fly
    the drug eradication planes. They do training with the
    Colombian military operating Plan Colombia helicopters and a
    variety of other tasks. But those are--the big numbers would be
    those numbers.
        Senator Pryor. Right. The reason I ask that is because we
    focus a lot of times just on the troops, but there is this
    other group of people that are impacted by this and obviously
    there are U.S. dollars, tax dollars, that follow that. So I
    just wanted to ask that question.
        Also, with regard to Plan Colombia, I believe Senator
    Sessions mentioned that a few minutes ago. Under the lessons
    learned category, are you satisfied with Plan Colombia or are
    there things that we can improve there, can do better in the
    future?
        General Hill. I think Plan Colombia has been a visionary
    endeavor between the United States, the United States Congress
    which funded it, and the Colombian military and people. Several
    things happened. There was the commitment of the Congress of
    the United States to the Colombians and the Colombians have
    responded. The helicopter support has allowed the Colombian
    military to make the tactical and operational moves that they
    could not have made without that helicopter support, and the
    operational advice and mentorship that we have provided them
    has allowed them to exponentially improve themselves as a
    military.
        I think Plan Colombia has been a significant investment and
    it is truly beginning to pay off.
        Senator Pryor. Are there ways to improve upon it?
        General Hill. To continue to sustain it, and we need to
    begin to think our way through in the next couple of years how
    do you nationalize the helicopters that we have been paying for
    under Plan Colombia to provide them to the Colombians in a way
    that they can sustain that effort. We are beginning to develop
    those plans and will be coming to the Congress later with that.
        Senator Pryor. Great. I look forward to working with you on
    that.
        Admiral Fargo, I have a question for you about missile
    defense. In your testimony, on page 15, you talked about ``Our
    forward-deployed naval forces, command and control elements,
    and interceptor assets will be ready to support missile defense
    initial defense operations on or before 1 October.'' We still
    need to increase the numbers of Patriot, Gem, and PAC-3
    missiles offshore to develop a sea-based terminal missile
    defense capability.
        I would like to ask you about the Patriot, Gem, and PAC-3.
    Does this mean that you think we need to increase those over
    and above what we are requesting right now, over and above the
    President's request?
        Admiral Fargo. I think there are a couple of aspects of
    this, Senator. One is that the Patriot PAC-3 is an effective
    system. We know it provides solid terminal defense. We need to
    look at our requirements throughout the region. We also need to
    look at the requirements of our friends and allies with respect
    to Patriot PAC-3, very specifically Taiwan.
        That does not diminish the requirement for the sea-based
    systems that you just mentioned. They are self-lifting, they
    have the ability to move into locations on short notice to
    provide defense. I think it is all part of the larger
    architecture that has to be in place to defend our homeland as
    well as our forces that are forward.
        Senator Pryor. One reason I ask that question is I notice
    that, in terms of authorization, we have authorized 144 PAC-3s
    and we are capable of building that many, we have the capacity
    to do that. But I believe that the current budget request is
    for only 108. So actually I plan on trying to get that
    increased up to the level that we had originally authorized,
    because from everything I hear they work wonderfully, they are
    very proven, they are very good at what they do.
        So I just wanted to hear your comments on that. I thought
    it was interesting, your testimony was very consistent with
    what my impression is.
        Mr. Chairman, that is all I have.
        Chairman Warner. Thank you, Senator Pryor.
        We will now proceed with another round of questions,
    bearing in mind that in probably 25 minutes or so the Senate
    will be voting and we will have to depart, of course.
        General LaPorte, I have always taken quite an interest in
    the situation in Korea, and I think you lay out on page 16 of
    your very well-prepared statement--indeed, I want to commend
    all the witnesses for the preparation and thoroughness of their
    statements. I would like to read it: ``Since its inception a
    quarter of a century ago, the Combined Forces Command has been
    the cornerstone of deterrence on the Korean Asia-Pacific
    peninsula--vigilant, well-trained, ready to fight tonight and
    win. Combined deterrence is achieved by an integrated team of
    approximately 680,000 active and 3 million plus Reserve
    personnel from the ROK and more than 37,500 U.S. military
    personnel forward deployed in Korea. The United States forces
    assigned to Korea add a state-of-the-art operational capability
    to the Korean peninsula.''
        Now, that is a very significant force structure, certainly
    numerically, that the South Koreans have. I would like to have
    you tell us a little bit about how the command and control of
    this entire force structure, including ours, is exercised and
    your own professional judgment as to the professionalism and
    the equipment of the South Korean military structure, as we are
    always concerned that something could happen, given the
    extraordinary uncertainties surrounding the government of North
    Korea and indeed the unpredictability.
        But basically, as I look at this, 680,000 active on the
    South Korean forces and 37,500 on ours, we are a relatively
    small part with regard to numerical statistics. I presume--how
    quickly can the 3 million reservists be called up and
    activated? It would be helpful if you expanded a little bit on
    that in response to my question, and then I would hope you
    would provide the committee, I ask you to provide the
    committee, an expanded dissertation on this force structure and
    the command and control.
        [The information referred to follows:]

        Senator Warner, your question regarding the command structure and
    capabilities of the ROK military forces and the command structure of
    the ROK-United States Combined Forces Command is relevant and timely as
    the United States transforms its forces and basing strategy.
        The ROK armed forces are trained and ready to deter and defend
    against external threats to the ROK. Under the current Armistice
    conditions, the Active-Duty Force structure of the ROK military is
    commanded by the ROK Joint Chiefs of Staff and consists of 550,000
    Army, 67,000 Navy and Marine Corps, and 63,000 Air Force. Three million
    forty thousand Reserve personnel, all of whom have completed
    approximately 2 years of compulsory active service, can augment these
    formidable, professional, and well-equipped ROK forces.
        ROK Army forces are organized into three field armies that defend
    specified geographic areas of the peninsula, and are augmented by
    functional commands performing support and special operations missions.
    ROK Army units are equipped with modern tanks, artillery, and infantry
    fighting vehicles tailored for defense on the Korean Peninsula. The ROK
    Army continues to pursue advanced precision strike, operational
    maneuver, intelligence, reconnaissance, and surveillance systems to
    enhance the effectiveness of its warfighting formations.
        The ROK Air Force has over 700 fighter, bomber, airlift, and
    reconnaissance aircraft--including a large number of older F4 and F5
    fighter aircraft, along with modern F-16s and a program to procure 40
    F-15K and long-range refueling aircraft. The ROK Air Force is procuring
    advanced precision munitions to enhance its close air support and
    interdiction capabilities. Additionally, the ROK Air Force commands
    peninsula air defense artillery composed of three brigades currently
    equipped with HAWK and NIKE missiles. The air defense command is
    seeking to enhance peninsula defense capabilities by fielding an
    advanced surface-to-air missile system.
        The ROK Navy is organized into three fleets and two flotillas
    performing coastal defense and amphibious operations. The ROK Navy has
    over 200 ships, comprised of a variety of submarines, destroyers,
    frigates, coastal patrol, mine warfare, amphibious operation and
    support ships, and rotary and fixed-wing aircraft to accomplish its
    missions. The ROK Navy is in the process of bringing advanced
    destroyers, submarines, amphibious landing craft, anti-submarine
    systems, and advanced missiles into service. These enhanced
    capabilities will transform the ROK Navy from a coastal fleet to a
    strategically mobile, regionally capable force.
        ROK Marine Corps consists of 25,000 well-trained and highly-
    motivated personnel organized into two divisions and a separate
    brigade. The ROK Marines are equipped with amphibious landing vehicles,
    tanks, and artillery to support operational maneuver. The ROK Marine
    Corps, like the other services, is in the process of enhancing its
    capabilities with upgraded equipment.
        ROK Army Special Warfare Command is a highly trained, experienced
    special operations force. This command has participated in peacekeeping
    operations in East Timor. The ROK Army Special Warfare Command will
    provide many of the 3,000 additional troops pledged for deployment to
    Iraq later this year.
        Overall, the ROK military is well-organized and equipped to defend
    the peninsula against threats from North Korea. Ongoing ROK
    transformation efforts will only improve these capabilities in the
    future.
        United States forces based in Korea provide state-of-the-art
    command and control, intelligence, precision strike, air superiority,
    and dominant maneuver to augment ROK forces during Armistice and
    crisis. The 37,500 U.S. forces based in Korea, along with other forces
    that can rapidly reinforce the peninsula, ensure that the combined
    forces of ROK and United States based in Korea have the capabilities to
    deter and if necessary, rapidly overwhelm and defeat aggression.
    Transformation of U.S. forces based in Korea will significantly enhance
    our ability to accomplish these missions. Moreover, the presence of
    U.S. capabilities on the peninsula reassures allies and friends of our
    commitment to peace and stability in the region.
        During Armistice conditions, our normal day-to-day condition in
    Korea, command is exercised through national lines; that is United
    States forces are commanded through the United States Joint Chiefs of
    Staff, and ROK forces are commanded through the ROK Joint Chiefs of
    Staff. To formally establish command relations in the event of crisis
    on the peninsula, ROK-U.S. Combined Forces Command was established in
    1978. Because the Combined Forces Command is a binational command, the
    U.S. Secretary of Defense and the ROK Minister of Defense provide
    strategic guidance for training, readiness, and operations to the ROK-
    U.S. Military Committee. The ROK-U.S. Military Committee, which
    includes the Chairman of the U.S. Joint Chiefs of Staff, the Chairman
    of the ROK Joint Chiefs of Staff, and the Commander of Combined Forces
    Command, implements these guidelines to ensure military readiness and
    deterrence. The Military Committee provides the Commander of the
    Combined Forces Command with overall command of ROK-U.S. forces during
    crisis and substantial armistice authorities to prepare ROK and U.S.
    forces to accomplish wartime missions; for example, assignment of roles
    and missions, operational planning, training exercises, and making
    recommendations for capabilities enhancements and modernization.
        The Combined Forces Command is a truly integrated headquarters,
    commanded by a U.S. four-star general with a ROK four-star general as
    deputy commander. The joint and combined staff of ROK and U.S.
    officers, from all the military services and branches, works and trains
    together every day of the year. This combined headquarters, and the
    close integration of the joint and combined units on the Korean
    peninsula, ensures that the forces remain trained and ready to
    accomplish the core purposes of deterring threats, defeating
    aggression, and strengthening regional security and stability.

        General LaPorte. It is certainly my pleasure to expand on
    that question. I think it is a very good news story. First of
    all, I get in my duties to travel around the peninsula and
    visit all the Army, Air Force, Navy, and Marine Forces, both
    ROK and U.S. I will tell you, Senator, you would be very proud.
        It is truly a combined force. At most of these headquarters
    you would see U.S. personnel sitting side-by-side with a ROK
    soldier, sailor, airman, or marine. We clearly do everything in
    a combined manner. My headquarters is combined.
        We have made tremendous advancements in our command and
    control, communications, and intelligence apparatus, and
    infrastructure, over the past 2 years. I am very confident in
    our ability, the ability to battle command that force. The ROK
    military, as I mentioned previously, is well-trained, well-
    equipped, all their forces, and highly-motivated, and they have
    extremely competent military leaders who have trained, many of
    them, in U.S. service schools.
        I am very confident of this force. The Reserve Force can be
    mobilized within 4 days, and this is a process that takes place
    and it is practiced yearly as part of two major exercises.
        I have just returned to the United States from Korea, where
    we just conducted a 10-day exercise called Reception, Staging,
    Onward Movement, Integration. We rehearsed and trained on our
    ability to reinforce the peninsula. Again, this is a very, very
    professional effort on the behalf of both the ROK and the U.S.
    forces, tremendous combined operations: Air Force flights being
    led by ROK pilots with U.S. forces integrated; an amphibious
    operation conducted primarily by the ROK marines, supported by
    the U.S. Navy; Army and naval, the same type of operation.
        Chairman Warner. I guess I accept those personal
    observations, but 37,500 is a very significant number in
    relation to our total Armed Forces and, given that that is
    about 5 percent compared to the Active Force in just the army
    of the ROK, is it the equipment that we possess? That equipment
    is presumably, of course, state-of-the-art. But is comparable
    equipment found in the South Korean forces?
        General LaPorte. The South Korean forces have the
    predominance of the forces, as you mention. The United States
    complements that with tremendous strategic and operational
    capabilities that we can bring to bear both in a deterrent role
    and in a warfighting role.
        Chairman Warner. Is it your judgment that that 37,500 is
    the number of forces you need to, I presume the word is,
    augment the forces of South Korea, although I would presume you
    have a sort of----
        General LaPorte. It is really a complementary role that we
    have. Senator, my professional assessment is that we have the
    force structure, both ROK and U.S., to be able to accomplish
    our mission.
        Chairman Warner. We will take a closer look after you
    provide your paper to us as to that force level. Once again, is
    the military equipment of the South Korean forces comparable to
    ours in quality and state-of-the-art?
        General LaPorte. In most cases, yes, Senator. For instance,
    they are buying an Aegis cruiser. They have purchased the F-15
    aircraft. They fly F-16 aircraft and have very capable naval
    forces.
        Chairman Warner. All right, let us look at it further.
        Lastly, to each witness: In my opening statement I reported
    that you address the Secretary of Defense's global force
    posture review and how that would impact on your AOR. First,
    Admiral Fargo?
        Admiral Fargo. I think that, as I mentioned earlier, the
    global force posture review, its time has certainly come. It
    has been really 50 years since after World War II, we have
    reset the force properly. We have been working on this for
    almost a year in the Pacific, providing our recommendations to
    the Secretary of Defense, and we will have another session this
    week.
        I am very confident that we are going to meet all of those
    principles I outlined a few minutes ago in terms of
    strengthening our alliances and immediate employability and
    certainly dealing with the new and uncertain threat environment
    for the future. I think it is probably premature to talk about
    the specifics with respect to that global posture. It is a
    large and complex effort and one that working through with our
    allies, I think, is particularly important to its success.
        Chairman Warner. General Hill?
        General Hill. Senator Warner, I would echo all of Admiral
    Fargo's comments and then just add that, as you are aware, my
    forward presence is very modest. We have some 600 folks at Soto
    Cano and we operate four cooperative security locations, which
    used to be known as forward operating locations, at Manta,
    Ecuador; Comalapa, El Salvador; Aruba, and Curacao. Those are
    joint ventures with those respective countries where we share
    an airfield and do drug interdiction and monitor flights out
    of.
        Chairman Warner. Thank you.
        General LaPorte?
        General LaPorte. Sir, I agree with Admiral Fargo and
    General Hill. I think this is a good program to continue.
        Chairman Warner. Thank you.
        Senator Levin.
        Senator Levin. Thank you, Mr. Chairman.
        First, General Hill, according to a U.S. Army War College
    paper that was published in March 2003, some of the gains under
    the administration of President Uribe could be credited to
    former President Pastrana's efforts, including increasing the
    size of the army, retaining effective commanders, and certain
    operational successes.
        I visited Colombia when Pastrana was the President and I
    did have the feeling that he was really trying to move Colombia
    in the right direction. Would you agree with that assessment,
    by the way? If so, would you have hopes and expectations that
    Uribe's successor, I guess a couple years now down the road,
    would continue in this pattern?
        General Hill. Yes, sir, I think that that is a correct
    assessment. I think the Pastrana government was in fact
    modernizing and growing the Colombian military. If there is
    anything that--the Pastrana government gave us two things, I
    think. One, it gave us Plan Colombia and their ability to work
    with this Congress to develop Plan Colombia. That was
    visionary.
        The second thing it did was the whole idea of the dispeje
    (safe haven), where they gave the FARC a portion of Colombia
    about the size of Switzerland and said, let us all kind of
    negotiate through this, clearly proved that there is no
    negotiating with the FARC and it set--it clearly showed them to
    be the evil people that they are, and that helped the Colombian
    people understand the real threat against them.
        I also believe that when President Uribe leaves office in 2
    years that his successor will continue those, because I believe
    that the Colombian people want that to continue.
        Senator Levin. Thank you.
        General Hill, relative to Haiti, do you expect that U.S.
    forces will remain in Haiti after a U.N. peacekeeping force
    deploys, if it deploys?
        General Hill. Sir, I do not know what the U.S. role will be
    in the follow-on U.N. force. That will be a matter of
    negotiation over the coming months.
        Senator Levin. There is no decision made yet on that?
        General Hill. No, sir, there has not been.
        Senator Levin. Admiral Fargo, I think you may have made a
    brief reference to this, but let me ask you to expand a bit.
    Have the Chinese changed their military posture or operations
    in any way in response to the political situation in Taiwan and
    their distrust of the Taiwanese president?
        Admiral Fargo. No, sir, not that we have detected. They are
    doing the kinds of exercises we would expect them to be doing
    this time of the year.
        Senator Levin. Let me go back to you, General Hill. I want
    to ask you about the Panama Canal, as to whether or not the
    location of Hutchison Whampoa at either end of the Panama Canal
    has had a negative security impact?
        General Hill. It has not, sir.
        Senator Levin. Switching back to you, Admiral Fargo. Has
    the situation in Taiwan affected our military relations with
    China?
        Admiral Fargo. I would say, Senator, that the modest
    military-to-military relationship that we have with China is
    actually on a positive vector. I have visited once in my
    capacity as Commander of the U.S.PACOM and once as the
    U.S.PACFLT Commander. I hosted my counterpart, the Nanjing
    military region commander, this year in Hawaii. What I have
    noticed over these successive visits is the dialogue has
    improved in terms of candid conversations and developing some
    understanding of what our shared interests are, and also what
    our differences are.
        We had two port calls in China over the last 12 months. I
    think this modest military-to-military relationship is healthy.
    It does provide us an opportunity to show the People's Republic
    of China the quality of our capability and the quality of our
    relationships.
        Senator Levin. Finally, Admiral Fargo, you have made
    reference to Indonesia and the investigation in the aftermath
    of the Bali bombing and also other acts of terrorism in
    Indonesia. I want to just quote to you from that March 2
    Associated Press story. It says that, ``A senior U.S. official
    familiar with the investigation of the August 2002 killing of
    the two U.S. teachers and an Indonesian colleague asserts that
    there was Indonesian military involvement and that `it is only
    a question of how high up this went within the chain of
    command.' ''
        Now, that is a pretty serious statement. In your judgment,
    is it accurate, and, if so, have you raised this issue with the
    Indonesian military?
        Admiral Fargo. I have not seen an FBI report that says
    that, Senator. This is something we are tracking very closely
    and obviously I am looking at every piece of information and
    investigation that comes out. But I have not seen that.
        Certainly, as I mentioned earlier, I have had a number of
    conversations with General Sutarto about the importance of
    their full and complete cooperation with this investigation,
    and the most recent reports that I have received from our
    country team there is that cooperation has been good.
        Senator Levin. But as of this point, at least, it has not
    been brought to your attention any evidence that the Indonesian
    military was involved in those killings?
        Admiral Fargo. I have not seen any evidence to that
    respect. I read the same stories, but I have not seen a report
    that so indicates.
        Senator Levin. I assume that if and when such evidence is
    presented to you that you would take appropriate action and
    raise that issue very strongly with the Indonesian military?
        Admiral Fargo. I certainly raised both points with General
    Sutarto and he has told me that if these investigations come
    out and indicate that the Indonesian military was involved that
    he will take disciplinary action.
        Senator Levin. Thank you.
        Thank you, Mr. Chairman.
        Chairman Warner. Senator Bill Nelson.
        Senator Bill Nelson. No questions. I am going to do it
    privately, Mr. Chairman.
        Chairman Warner. Senator Pryor.
        Senator Pryor. I do not have any questions, Mr. Chairman.
    Thank you.
        Chairman Warner. I would like to do one or two wrap-up
    questions.
        General Hill, we recognize that the U.S.NORTHCOM has Cuba
    in its AOR. I will have to go back and check the record of our
    hearings at the time the U.S.NORTHCOM commander was here. At
    one time it was in your command, was it not?
        General Hill. It was in my AOR, correct, in my space.
        Chairman Warner. But I think the situation in Cuba has a
    direct impact on the situations in your AOR and I think it
    would be helpful for our record today to have your professional
    summary of what you view as taking place in Cuba today and how
    it impacts on the responsibilities that you have.
        General Hill. I will provide that for the record, Senator,
    if that is what you would like. But also, to just----
        Chairman Warner. I think I would like to have a clear
    statement for the record, but perhaps you can comment a little
    bit.
        [The information referred to follows:]

        [Deleted.]

        General Hill. Yes, sir. The fact that it is not in my area,
    I still have operational issues with Cuba.
        Chairman Warner. That is correct.
        General Hill. I still run Guantanamo, for example, and if
    there were operational needs in Cuba, I would do that. We have
    had very solid relations with the Cubans around Guantanamo,
    especially as we have brought in the detainees, and we watch
    what happens there very carefully.
        Short of that, I need to provide you for the record, sir.
        Chairman Warner. All right.
        Admiral Fargo, India and Pakistan. I think it would be
    important that our record reflect today some expansion of your
    views on that, the tensions along the line of control, and its
    current status. Would you provide that now orally and then
    provide such additional comments as you wish to have for the
    record?
        Admiral Fargo. Mr. Chairman, we are very encouraged by the
    current dialogue that is ongoing between India and Pakistan.
    Certainly these are two very important countries. India of
    course, being the largest democracy, will be a natural partner
    with the United States. The dialogue that is occurring in our
    assessment is reducing tensions along those borders and we
    would hope would proceed toward some resolution of the issues
    in Kashmir. But right now I would tell you it is encouraging.
        [The information referred to follows:]

        Recent dialogue between India and Pakistan and the resulting
    relaxation in tensions are very positive signs. As a result of the
    President's vision to transform relations with India and forge strong
    ties with Pakistan, the United States now enjoys excellent and
    productive relations with New Delhi and Islamabad at the same time.
    Both countries are important strategic partners--we work each
    relationship on its own merits and our mutual security needs.
        We strongly support the ongoing dialogue between India and
    Pakistan. We welcome the steps they have taken to rapprochement, such
    as the cease-fire along the Line of Control and the reopening of some
    transportation links.
        Both governments have put forward a comprehensive dialogue agenda
    on a measured timetable. The new Indian Government has asked for a
    short delay in progression of talks in order to prepare for the
    upcoming meetings. By all accounts Prime Minister Manmohan Singh's
    government will continue the Indo-Pak peace process. Expert level talks
    on nuclear confidence building measures will be held 19-20 June while
    the Foreign Secretaries will sit down at the end of June. Additional
    dialog between India and Pakistan will occur throughout the summer,
    which is a positive sign that the subcontinent is focused on peace
    rather than conflict.

        Chairman Warner. I have had the opportunity to visit
    Pakistan twice, the first time recently with my distinguished
    colleague and this last time with Senator Stevens and Senator
    Hollings. We had a very thorough opportunity to visit with the
    president and other leaders in that country.
        The recent U.S. announcement that Pakistan would be
    declared a ``major non-NATO ally,'' did that in any way
    destabilize this relationship?
        Admiral Fargo. No, sir, I do not think so.
        Chairman Warner. I think they are deserving of it. That
    country is pivotal in our war on terrorism and they have been a
    strong ally.
        Senator Levin, do you want to take a question or two?
        Senator Levin. I am all set. I am all questioned out. That
    is off the record, by the way. [Laughter.]
        Chairman Warner. I think we should have a quick mention by
    General LaPorte of the ROK's contribution to the coalition of
    forces serving in Iraq. Could you describe that for the record,
    please?
        General LaPorte. Yes, sir. Since 2002 the ROK has
    steadfastly supported the global war on terrorism. They are
    providing forces to Iraq and Afghanistan. Their navy and air
    force have supported the logistics efforts. They have medical
    personnel serving now in Iraq and they are deploying 3,000
    troops. That will make them the third largest nation
    contributing forces, and they will deploy here shortly.
        General Hill. Senator Warner, could I add something for the
    record in that same vein?
        Chairman Warner. Yes, of course.
        General Hill. That is to recognize the contributions of El
    Salvador, the Dominican Republic, Nicaragua, and Honduras to
    the OIF also.
        Chairman Warner. That is important.
        Admiral Fargo, are there nations in your AOR involved?
        Admiral Fargo. The nations in our AOR have made a wide
    range of contributions. When you look from north to south, of
    course the Japanese are making historic deployments. As General
    LaPorte mentioned, Korea, Thailand, the Philippines, Mongolia,
    Nepal, and even Fiji and Tonga have offered up troops.
    Singapore has been very supportive. The Indians of course
    provided the first Strait of Malacca patrol after September 11.
    So the support has been superb.
        I need to mention Australia, too, of course, and New
    Zealand. I hope I have not forgotten somebody, but I am moving
    north to south here.
        Chairman Warner. I think it is important to share credit
    for the coalition of forces that are working towards freedom
    for the Iraqi people.
        General LaPorte, as we close, I must say that I am very
    encouraged by your assessment of the South Korean military
    forces. My modest knowledge on that is over a half century old,
    but I remember you are still loading a U.N. force, which I
    think is interesting. I think we should remind people of that.
    The United Nations, that is the umbrella under which you
    operate, am I not correct?
        General LaPorte. That is correct, sir.
        Chairman Warner. I remember in the conflict, 1951-1952, the
    front lines were drawn up such that nations were sort of in
    parallel in their positions, and there was an old axiom among
    the marines: When a ROK division was on your flank you could
    sleep tonight; they were good soldiers.
        Thank you very much. The hearing is adjourned.
        [Questions for the record with answers supplied follow:]
                   Questions Submitted by Senator John McCain
                             transnational threats
        1. Senator McCain. Admiral Fargo, from your statement, you
    identified that transnational threats of terrorism, narcotics
    trafficking, and proliferation as a primary concern to you in PACOM.
    They are also a challenge to all of us in the global war on terrorism.
    What initiatives, multinational approaches, or arrangements are you
    suggesting that we support to handle this very serious concern in the
    Pacific and can they be extended elsewhere?
        Admiral Fargo. Thank you, Senator, for the opportunity to address
    this extremely important issue. I am often asked whether I am a
    ``multilateralist'' or ``bilateralist.'' My answer, of course, is
    ``both,'' because while some activities, such as Operation Enduring
    Freedom-Philippines which is building counterterrorist capacity, are
    more easily conducted in a bilateral format, most transnational threats
    demand multinational solutions. Clearly, the evolving character of
    transnational threats demands creativity in response. So let me provide
    some examples that illustrate the cooperative and interagency flavor of
    PACOM's approaches to transnational threats.
        Multilateral approaches include our Regional Maritime Security
    Initiative (RMSI) to promote cooperation against transnational maritime
    threats.
        Secure waterways are vital to peace and prosperity of the Asia-
    Pacific region. The oceans provide trade, communication, travel, and
    access to precious energy resources on which the growing economies of
    Asia depend. The narrow straits of Southeast Asia, through which one-
    third of the world's shipping and half of its oil pass each year, are
    of strategic importance to us all. So clearly the seas, and the
    resources that flow through them, must be both shared and protected.
        Transnational threats not only challenge maritime security itself,
    but also abuse the maritime environment for illicit purposes. Unsecured
    or ungoverned seas are potential havens for criminal or terrorist
    activity, providing relatively cheap and inconspicuous movement. The
    thousands of miles of coastline many of us enjoy are sometimes
    uninhabited and often difficult to regulate.
        A RMSI would provide a plan of action to address these concerns.
    The goal of RMSI is to develop a partnership of willing regional
    nations with varying capabilities and capacities to identify, monitor,
    and intercept transnational maritime threats under existing
    international and domestic laws.
        This collective effort will empower each participating nation with
    the timely information and capabilities it needs to act against
    maritime threats in its own territorial seas. As always, each nation
    will have to decide for itself what response, if any, it will take in
    its own waters.
        Information sharing will also contribute to the security of
    international seas, creating an environment hostile to terrorism and
    other criminal activities. Any RMSI activity in international waters
    will, again, be in accordance with existing international law.
        We believe there are five primary elements of maritime security.
    Operationally, this initiative has to start by leveraging technology to
    build and share a clear picture of the maritime environment to match
    that which we have of international airspace today. So we need to
    enhance situational awareness of the maritime environment, establish
    protocols, processes, and standards to fuse that information, and then
    share it between like-minded governments.
        Then, participating nations will need responsive information
    sharing and decisionmaking arrangements and appropriate maritime
    interdiction capabilities to carry out those decisions. In most
    instances, these will take the form of law enforcement or customs
    vessels, but military forces may be needed for more organized threats,
    especially on the high seas.
        The fourth element for RMSI is the ability to provide security in
    challenging littoral regions. Most nations need a coast guard before
    they need what I would call a ``blue water'' navy. Once established,
    integration of coast guard operations with naval forces is essential to
    eliminate seams at sea, just as that same coast guard must have
    established protocols and procedures to integrate its efforts with
    harbor security agencies ashore. Of course, port security measures like
    the Container Security Initiative are key elements in the continuum of
    protection.
        Finally, 21st century maritime security is much more than the
    application of military capability. In fact, RMSI will often be a law
    enforcement effort. So clearly, maritime threats that span oceans,
    threaten straits, and prey on international trade will demand
    cooperation among a wide array of agencies and ministries to
    synchronize all elements of our regional capability.
        The RMSI is still in its infancy. We are discussing the RMSI
    concept with friends and allies in the region, both to clarify the
    concept and to explore existing technologies and best practices
    relevant to maritime security. My sense is there is already much good
    work ongoing throughout the region that we can leverage. Although RMSI
    is a Pacific Command initiative, its elements, and the underlying
    concerns that precipitated this initiative, certainly are applicable
    worldwide.
        I should also mention our premier multilateral exercise in the
    Pacific, Cobra Gold, an annual event hosted by Thailand. This exercise
    is specifically designed to promote capabilities and cooperation to
    deal with military operations other than war and transnational threats
    like terrorism and illicit narcotics.
        We also have crafted creative U.S. interagency approaches to
    transnational threats. Let me provide just two examples.
        Our Joint Interagency Coordination Group for Counterterrorism
    (JIACG/CT) is the PACOM staff entity responsible for coordinating DOD
    and other government agency CT activities within the U.S.PACOM area of
    responsibility. Last year, the JIACG combined intelligence, operations,
    and training goals with interagency representation to produce our first
    theater CT Campaign Plan. This plan, aligned with Department of State
    goals embedded in embassy Mission Performance Plans, focuses on both
    near-term and long-term war on terrorism efforts. These efforts include
    CT resource creation, terrorist identification and destruction, and the
    long-term effort to strengthen democratic institutions of governance.
    As the lead staff element in U.S.PACOM's fight against transnational
    threats, the mission of JIACG-CT is being broadened to include
    coordination of our counterdrug and counterproliferation efforts. Other
    regional combatant commands also employ JIACGs for a variety of
    missions.
        The Joint Interagency Task Force-West (JIATF-W) has long been
    U.S.PACOM's premier operational counterdrug entity. Formerly based in
    California, JIATF-W is relocating to Hawaii to better confront the
    narcotic threat in the western Pacific. Its experience, assets, and
    interagency relationships will also be relevant against related
    transnational threats like narcoterrorism, piracy, human trafficking,
    and especially weapons proliferation. JIATF-W's interagency approach
    facilitates contributions of law enforcement, host nations, and Special
    Operations Forces.

               promoting reform and counterterrorism in indonesia
        2. Senator McCain. Admiral Fargo, Indonesia is the world's most
    populous Muslim nation and third largest democracy. I believe that
    enhancing stability and democratic reforms in this country are critical
    to peace in the region. Indonesia is proving to be an active supporter
    in the global war on terror assisting in the arrest and prosecution of
    34 Jemaah Islamiyah terrorists who committed the Bali bombing in
    October 2002. From your statement you stated that Australia is
    supporting a joint antiterrorism center in Indonesia. What efforts can
    we pursue to advance counterterrorism efforts and promote Tentara
    Nasional Indonesia (TNI) professional reform in this critical country?
        Admiral Fargo. The TNI is one of the most coherent Indonesian
    government institutions and will play a central role in shaping the
    future of the democracy. It is also an organization tainted by past
    human rights abuses, a lack of accountability, and corruption--
    conditions that led to restrictions on our military-to-military
    relationship and must be resolved.
        The TNI appears committed to reform, and there is evidence of
    positive change in the military. I have discussed these reform efforts
    with TNI Chief of Defense, General Sutarto, and rate it as one of the
    highest priorities for PACOM security cooperation with Indonesia. I
    believe that the most effective means of aiding reform efforts and
    increasing the professionalism of TNI is by providing in-depth and
    prolonged exposure to our own military through education, training, and
    exercises.
        To that end, and working with our embassy country team in Jakarta,
    we have developed a plan of activities that meets all legal
    constraints. We will leverage E-IMET, Regional Defense Counterterrorism
    Fellowships, and other authorized multilateral venues to expose
    Indonesian officials, including appropriate TNI officers, to non-lethal
    U.S. professional military standards.
                                     ______

                  Questions Submitted by Senator Wayne Allard
                  indonesian connection to murdered americans
        3. Senator Allard. Admiral Fargo, during your oral testimony, you
    indicated that you had no knowledge of information or intelligence
    suggesting that the Indonesian military could be tied to the murder of
    two Americans on August 31, 2001 in Papua, Indonesia. Yet press reports
    and other administration officials have indicated otherwise. Is there
    intelligence that suggests the Indonesian military was responsible for
    the murder of these two Americans on August 31, 2001?
        Admiral Fargo. Investigation and accountability for the Freeport-
    McMoran Mine slayings is the primary issue shaping our relationship
    with Indonesia today. I have discussed this incident with the TNI Chief
    of Defense, General Sutarto, and emphasized the importance of full
    accountability. He assured me that if this investigation shows that
    there are members of the TNI that took part in this attack that he is
    going to hold them completely accountable, and there will be the kind
    of discipline that we would expect would be proper in this particular
    situation.
        I have also pressed for open cooperation with FBI investigators,
    including interrogation without the presence of TNI minders and
    forensic investigation in the continental United States. I have
    received several recent reports of enhanced cooperation and I believe
    the investigation is on track. I have not seen a final FBI report and,
    as the investigation is still ongoing, it would be inappropriate for me
    to speculate as to the outcome.

        4. Senator Allard. Admiral Fargo, some have suspected that the
    attack was ordered by military commanders in Jakarta, Indonesia. Do you
    believe the Indonesian military command authority was involved in the
    planning and execution of the attack?
        Admiral Fargo. Investigation and accountability for the Freeport-
    McMoran Mine slayings is the primary issue shaping our relationship
    with Indonesia today. I have made this point clear to TNI leadership,
    and have pressed for open cooperation with FBI investigators, including
    interrogation without the presence of TNI minders and forensic
    investigation in the continental United States.
        I have received several recent reports of enhanced cooperation and
    I believe the investigation is on track. As the investigation is still
    ongoing, it would be inappropriate for me to speculate as to the
    outcome.

        5. Senator Allard. Admiral Fargo, last year you stated that
    withholding IMET funding would not result in the satisfactory
    conclusion of this investigation. Why do you believe this?
        Admiral Fargo. On the contrary, withholding IMET funding only
    serves to further reduce U.S. influence in Indonesia and will likely
    lead to less satisfactory outcomes.
        In numerous discussions with Indonesian military and government
    officials, I have clearly identified accountability for the Freeport-
    McMoran Mine slayings as the primary issue shaping our relationship
    with Indonesia.
        I have also been thoroughly briefed by General Sutarto, the
    Indonesian Chief of Defense, on TNI reform efforts that eliminate their
    involvement in politics and emphasize civilian control of the military
    under the rule of law.
        I believe that we can best serve as role models and positively
    influence Indonesia's future through cooperation rather than isolation.
    IMET is one very useful influence tool for this purpose.

        6. Senator Allard. Admiral Fargo, I offered legislation last year
    that prohibited IMET funding for Indonesia until the Secretary of State
    certifies that Indonesia is proceeding with its investigation into the
    August 31, 2001 attack. I believe the United States cannot be seen as
    providing military assistance to a foreign military that might be
    responsible for murdering Americans. Until the Indonesian military is
    exonerated, wouldn't you agree that the United States cannot be seen as
    aiding a foreign military that might be responsible for murdering
    innocent Americans?
        Admiral Fargo. Thank you, Senator, for the opportunity to comment
    on this extremely important matter.
        I believe it is important to note from the outset that U.S.PACOM
    conducts military-to-military activities in full consideration of and
    adherence to DOD and Department of State regulatory procedures as well
    as in accordance with the Leahy Amendment emphasizing civilian
    authority over the military and respect for the rule of law.
        As the world's third largest democracy and largest Muslim nation,
    Indonesia's success is crucial to peace and stability in Southeast Asia
    and to our efforts in the war on terrorism. It is a critical crossroad
    in Southeast Asia and sits squarely in the sights of the region's
    primary transnational terror group, the JI. To allow this strategically
    important nation, one that is currently attempting to cement its
    nascent democracy, to remain both unknown to us and unaided could carry
    unfortunate consequences.
        The Indonesian government is moderate, secular and still developing
    as a free market democracy. I want to assure you that we share the same
    goals regarding the Indonesian military (TNI) and that I have discussed
    with General Sutarto our desire to see genuine reform of the TNI,
    accountability for human rights abuses, and full cooperation with the
    Timika investigation. We believe it is important to provide
    Indonesian military a role model and take an active part in their
    reform. By operating in accordance with existing guidelines for our
    activities with Indonesia, we maintain insight into their military's
    progress with their own reform program as well as position ourselves
    for future cooperation as Indonesian reform goals are achieved.

        [Whereupon, at 11:52 a.m., the committee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2005

                                  ----------

                             THURSDAY, MAY 13, 2004

                                           U.S. Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.

                        CONTINGENT RESERVE FUND REQUEST

        The committee met, pursuant to notice, at 9:42 a.m., in
    room SH-216, Hart Senate Office Building, Senator John Warner
    (chairman) presiding.
        Committee members present: Senators Warner, McCain, Inhofe,
    Allard, Sessions, Collins, Ensign, Talent, Chambliss, Dole,
    Levin, Kennedy, Byrd, Lieberman, Reed, Akaka, Bill Nelson, E.
    Benjamin Nelson, Dayton, Clinton, and Pryor.
        Committee staff members present: Judith A. Ansley, staff
    director; and Leah C. Brewer, nominations and hearings clerk.
        Majority staff members present: Charles W. Alsup,
    professional staff member; Ambrose R. Hock, professional staff
    member; Gregory T. Kiley, professional staff member; Thomas L.
    MacKenzie, professional staff member; Lucian L. Neimeyer,
    professional staff member; Paula J. Philbin, professional staff
    member; Lynn F. Rusten, professional staff member; Scott W.
    Stucky, general counsel; and Diana G. Tabler, professional
    staff member.
        Minority staff members present: Richard D. DeBobes,
    Democratic staff director; Richard W. Fieldhouse, professional
    staff member; Creighton Greene, professional staff member;
    Jeremy L. Hekhuis, professional staff member; Bridget W.
    Higgins, research assistant; Maren R. Leed, professional staff
    member; Gerald J. Leeling, minority counsel; Peter K. Levine,
    minority counsel; Michael J. McCord, professional staff member;
    and William G.P. Monahan, minority counsel.
        Staff assistants present: Michael N. Berger, Sara R.
    Mareno, and Pendred K. Wilson.
        Committee members' assistants present: Cord Sterling,
    assistant to Senator Warner; Christopher J. Paul and Marshall
    A. Salter, assistants to Senator McCain; John A. Bonsell,
    assistant to Senator Inhofe; Jayson Roehl, assistant to Senator
    Allard; D. Armand DeKeyser, assistant to Senator Sessions;
    Derek J. Maurer, assistant to Senator Collins; D'Arcy Grisier,
    assistant to Senator Ensign; Lindsey R. Neas, assistant to
    Senator Talent; Clyde A. Taylor IV, assistant to Senator
    Chambliss; Christine O. Hill, assistant to Senator Dole;
    Russell J. Thomasson, assistant to Senator Cornyn; Sharon L.
    Waxman, Mieke Y. Eoyang, and Jarret A. Wright, assistants to
    Senator Kennedy; Christina Evans, Terrence E. Sauvain, and Erik
    Raven, assistants to Senator Byrd; Frederick M. Downey,
    assistant to Senator Lieberman; Elizabeth King, assistant to
    Senator Reed; Davelyn Noelani Kalipi and Richard Kessler,
    assistants to Senator Akaka; William K. Sutey and Pete
    Mitchell, assistants to Senator Bill Nelson; Eric Pierce,
    assistant to Senator Ben Nelson; William Todd Houchins,
    assistant to Senator Dayton; Todd Rosenblum and Rashid
    Hallaway, assistants to Senator Bayh; Andrew Shapiro, assistant
    to Senator Clinton; and Terri Glaze, assistant to Senator
    Pryor.

           OPENING STATEMENT OF SENATOR JOHN WARNER, CHAIRMAN

        Chairman Warner. The committee meets this morning to
    receive testimony from Deputy Secretary of Defense, Paul
    Wolfowitz; Vice Chairman of Joint Chiefs of Staff, General
    Peter Pace, United States Marine Corps; and Deputy Director of
    the Office of Management and Budget (OMB), Joel Kaplan, on
    President Bush's request for a fiscal year 2005 contingent
    reserve fund for ongoing military operations in Iraq and
    Afghanistan. We look forward to your testimony.
        On May 5, 2004, President Bush announced his intention to
    request a $25 billion contingent reserve fund for fiscal year
    2005 for United States military operations in Iraq and
    Afghanistan. The President stated that, ``while we do not know
    the precise cost for operations next year, recent developments
    on the ground and increased demands on our troops indicate the
    need to plan for contingencies to make sure that there is no
    disruption in funding and resources for our troops.''
        This is a prudent course of action which I personally
    support. Congress received the President's formal request for
    this additional funding just yesterday. It's important to note
    that even with this reserve fund, the administration will still
    request a full fiscal year 2005 supplemental after the first of
    next year, 2005, when it can better estimate the costs of the
    ongoing war on terrorism.
        When the President made his announcements last week, the
    committee was in the process of marking up the fiscal year 2005
    National Defense Authorization bill. At the request of Senator
    Byrd, the committee deferred action on this request for
    additional funding until we could hold a hearing to receive
    more information on this request. I'm pleased that we're able
    to conduct this hearing prior to the floor action on the
    defense bill and I would say the ranking member was very active
    in putting this hearing together, and it was one that you also
    wanted very much.
        When the administration presented its budget request for
    fiscal year 2005 in February, the request did not include
    funding for costs associated with the ongoing global war on
    terrorism. This is in keeping with longstanding tradition of
    funding ongoing military operations through supplemental
    appropriations. At that time, the administration stated that it
    expected to request a supplemental to cover the costs after the
    start of calendar year 2005.
        Prior to the passage of a supplemental, the administration
    planned to cover the costs of the war with funds from other
    military accounts, a process commonly called cash flowing.
    Administration officials assured the committee in February and
    March that cash flowing ongoing military operations presented
    acceptable and manageable risk.
        However, circumstances have changed. Increased demands on
    our troops, particularly in Iraq, have led to concerns that
    additional funding may be needed prior to the start of calendar
    year 2005. Thus, the need for contingency funding. The proposed
    contingent reserve fund would act as a bridge between the
    fiscal year 2005 budget request and the fiscal year 2005
    supplemental expected in February 2005.
        If the President determines that additional resources are
    needed for ongoing military operations, he would first report
    to Congress and then be able to use funds in the contingent
    reserve up to $25 billion. The Senate is scheduled to begin
    consideration of the 2005 authorization bill this coming
    Monday, May 17. This hearing is designed to inform the Senate
    of the specifics of the proposed contingent reserve fund prior
    to floor action. We will then be in a better position to decide
    how and whether to authorize the additional funding for 2005 as
    part of our bill.
        I look forward to hearing from our witnesses the reasons
    for this request for a contingent reserve fund, and how the
    fund will be used to provide the additional resources our
    troops need to consider military operations in Iraq and
    Afghanistan.
        I'm also interested in administration recommendations on
    how the fund should be structured, including any suggested
    mechanism to govern the dispersal of these funds and necessary
    reporting requirements to ensure accountability for the use of
    these funds. I concur with the President that our first
    commitment must be to America's security and that our troops
    ``have the resources they need when they need them.'' We stand
    by to assist.
        There were a number of colleagues on my side of the aisle,
    including Senator Sessions whom I spoke with this morning, and
    others, such as Senator Allard, who is on the Budget Committee,
    who spoke of the need for this hearing.
        [The prepared statement of Senator Warner follows:]
                   Prepared Statement by Senator John Warner
        The committee meets this morning to receive testimony from Deputy
    Secretary of Defense Paul Wolfowitz, Vice Chairman of the Joint Chiefs
    of Staff General Peter Pace, USMC, and Deputy Director of the Office of
    Management and Budget (OMB), Joel Kaplan, on President Bush's request
    for a fiscal year 2005 contingent reserve fund for ongoing military
    operations in Iraq and Afghanistan. We look forward to your testimony.
        On May 5, 2004, President Bush announced his intention to request a
    $25 billion contingent reserve fund for fiscal year 2005 for United
    States military operations in Iraq and Afghanistan. The President
    stated that, ``While we do not know the precise costs for operations
    next year, recent developments on the ground and increased demands on
    our troops indicate the need to plan for contingencies. We must make
    sure there is no disruption in funding and resources for our troops.''
    This is a prudent course of action, which I support. Congress received
    the President's formal request for this additional funding yesterday.
        It is important to note that, even with this reserve fund, the
    administration will still request a full fiscal year 2005 supplemental
    after the first of the year, when it can better estimate the costs of
    the ongoing war on terror.
        When the President made his announcement last week, the committee
    was in the process of marking up the National Defense Authorization
    Bill for Fiscal Year 2005. At the request of Senator Byrd, the
    committee deferred action on this request for additional funding until
    we could hold a hearing to receive more information on this request. I
    am pleased that we are able to conduct this hearing prior to floor
    action on the defense authorization bill.
        When the administration presented its budget request for fiscal
    year 2005 in February, the request did not include funding for costs
    associated with the ongoing global war on terrorism. This is in keeping
    with longstanding tradition of funding ongoing military operations
    through supplemental appropriations. At that time, the administration
    stated that it expected to request a supplemental to cover these costs,
    after the start of calendar year 2005. Prior to the passage of a
    supplemental, the administration planned to cover the cost of the war
    with funds from other military accounts--a process commonly called
    ``cash flowing.'' Administration officials assured this committee in
    February and March that ``cash flowing'' ongoing military operations
    presented acceptable and manageable risk.
        However, circumstances have changed. Increased demands on our
    troops, particularly in Iraq, have led to concerns that additional
    funding may be needed prior to the start of calendar year 2005, thus
    the need for contingent funding. As proposed, the contingent reserve
    fund would act as a ``bridge'' between the fiscal year 2005 budget
    request and the fiscal year 2005 supplemental expected in February
    2005. If the President determines that additional resources are needed
    for ongoing military operations, he would first report to Congress and
    then be able to use funds in the contingent reserve, up to $25 billion.
        The Senate is scheduled to begin consideration of the National
    Defense Authorization Bill for Fiscal Year 2005 on Monday, May 17. This
    hearing is designed to inform the Senate on the specifics of the
    proposed contingent reserve fund prior to floor action on the bill. We
    will then be in a better position to decide whether to authorize this
    additional funding for fiscal year 2005, as part of our bill.
        I look forward to our witnesses outlining the reasons for the
    request for a contingent reserve fund, and how the fund will be used to
    provide the additional resources our troops may need to continue
    military operations in Iraq and Afghanistan. I am also interested in
    the administration's recommendations on how the fund should be
    structured, including any suggested mechanisms to govern the
    disbursement of these funds, and necessary reporting requirements to
    ensure accountability for the use of these funds.
        I agree with the President that our first commitment must be to
    America's security and that our troops ``have the resources they need,
    when they need them.'' We stand ready to assist in this goal.

        Chairman Warner. Senator Levin, do you have a few comments?

                    STATEMENT OF SENATOR CARL LEVIN

        Senator Levin. Thank you, Mr. Chairman. Today we're meeting
    to hear testimony on the administration's request for $25
    billion to fund the cost of ongoing operations in Iraq and
    Afghanistan over the first few months of fiscal year 2005. U.S.
    Armed Forces are currently spending over $5 billion per month
    for operations in Iraq and Afghanistan, and the homeland
    defense activities known as Operation Noble Eagle (ONE).
        A supplemental for fiscal year 2004 was enacted in early
    November, 5 weeks into the fiscal year, so that the Services
    would not have to absorb these tremendous incremental costs out
    of their regular budgets.
        In his State of the Union address in January, President
    Bush told us, ``in 2 weeks I will send you a budget that funds
    the war.'' But the fiscal year 2005 budget that the President
    sent to Congress contained no funding to fund the substantial
    costs of these ongoing operations.
        On February 24, I wrote to the Senate Budget Committee on
    the need to provide this type of funding to cover the expenses
    for these ongoing operations during the first few months of
    fiscal year 2005. I wrote the Budget Committee as follows: ``We
    should not wait until sometime during fiscal year 2005 to
    submit a supplemental budget request, as the administration did
    last year. Circumstances are different this year. Last year the
    war had not begun. Now having U.S. troops on the ground is a
    fact and recognizing this reality and paying for it is the
    responsible thing to do.''
        While it is certainly true I wrote that no one can predict
    with precision what these fiscal year 2005 costs will be, we
    could certainly provide funds to cover likely requirements for
    some period of the year, and I suggested in that letter
    increasing the budget authority and the national defense
    function by $30 billion in fiscal year 2005 to cover up to 6
    months of the incremental costs for the current pace of
    operations.
        The Senate Budget Committee agreed with that proposal and
    Section 312 of the Senate Budget Resolution provides for up to
    $30 billion to fund activities in Iraq and Afghanistan if the
    President makes a request for such funding. This language was
    contained in the resolution adopted by the Senate on March 11.
        On April 15, the Department of Defense (DOD) announced it
    was extending the tours of 20,000 servicemembers in Iraq,
    effectively increasing the size of our forces there and
    guaranteeing that the so-called burn rate, which already
    exceeds $5 billion a month for these operations, will climb
    still higher. Yet, when Deputy Secretary Wolfowitz appeared
    before this committee to discuss Iraq and Afghanistan a week
    after that announcement, there was still no acknowledgment of
    the need to adopt a supplemental budget.
        Last September, Section 8139 of the 2004 Defense
    Appropriations bill stated that the cost of ongoing operations
    in Iraq and Afghanistan should be included in the budget
    request, and last October, the chairman of the House Budget
    Committee told the DOD comptroller that these costs should be
    included in the 2005 budget request. Yet for months, DOD
    witnesses have asserted that no supplemental was needed until
    sometime next year.
        Since September 11, 2001, Congress has provided this
    administration with considerable sums of money and considerable
    flexibility in using that money. That flexibility has led to
    problems. In April 2003, the conferees on the fiscal year 2003
    supplemental for Iraq and Afghanistan stated the following:
    ``Approximately $750 million appropriated to operation and
    maintenance (O&M) accounts has been obligated for construction
    activities supporting the global war on terrorism and
    operations in Iraq.'' Funds for these projects have been
    expended without providing notice to Congress, despite repeated
    requests for information by both House and Senate
    Appropriations Committees and House and Senate Armed Services
    Committees, and as required by law.
        Given the recent statements by Senator Byrd and other
    Members of Congress that the DOD failed to keep Congress
    properly informed about how emergency funds have been spent, we
    need to find a way to act quickly to support our troops while
    still holding the executive branch accountable for how these
    funds will be used.
        We have to do better as we move forward. Congress has
    recognized that our Federal budget should not sweep these costs
    under the rug until after November and pretend that because we
    can't predict the exact cost of these operations, that we
    should not estimate the costs and budget for them now.
        On May 5, the President issued a statement finally
    acknowledging the problem, requesting that Congress,
    ``establish a $25 billion contingent emergency reserve fund to
    support operations in Iraq and Afghanistan.'' When the
    President announced his intention to submit this budget
    amendment, I had already prepared an amendment for last week's
    mark-up to authorize the $30 billion in additional funding that
    the Senate Budget Resolution has provided. The amendment that I
    circulated at that time contained budget detail.
        On learning of the President's statement, Senator Byrd very
    appropriately asked that our committee withhold action on
    providing these funds for 2005 until we could hold a hearing on
    how the administration intends to use such funds. The Defense
    Authorization bill, as our chairman has mentioned, is scheduled
    to go to the floor next week, and it's essential that we
    address this issue. We cannot pretend that our bill addresses
    the most pressing needs of our men and women in uniform if we
    do not address a major readiness issue facing our forces. Our
    bill does not yet fund the cost of these ongoing operations. We
    should act to do so in order not to damage the readiness of our
    forces by forcing them to borrow against their entire year's
    budget just to get through the first 4 or 5 months of the year.
        But to budget responsibly, we need information from the DOD
    and OMB, and we need to have control over these funds and the
    detail which is proposed and necessary so that we can budget in
    a reasonable and responsible way, and that is what today's
    hearing is intended to be.
        Over a week now has elapsed now since the President
    announced his decision, and yet there was no formal request
    made until last night. The administration has acted too
    unilaterally in many ways in the Iraq war. They failed to
    budget for the costs of the war. Now they want, apparently, as
    I read these letters, what amounts to a blank check for the
    supplemental costs.
        Congress should write a check. In fact, we've been pressing
    to write a check, but not a blank check. We need to support our
    men and women in uniform who are performing very difficult and
    challenging tasks under dangerous circumstances, but we should
    do so in a way which provides the accountability that the
    taxpayers expect and deserve.
        Finally, Mr. Chairman, while this hearing is focused on
    funding these operations for fiscal year 2005, many of us are
    concerned that the Army in particular does not have sufficient
    funds to make it through the rest of fiscal year 2004,
    especially in light of the DOD's decision to increase our
    planned troop levels in Iraq by about 20,000 personnel. I hope
    our witnesses are prepared to tell us whether or not we have
    the resources necessary to sustain our forces for the rest of
    this fiscal year. Thank you.
        Chairman Warner. Thank you, Senator Levin. Colleagues, I'd
    like to turn to an administrative announcement and request to
    the committee. Indeed, the President and the Secretary of
    Defense and Deputy Secretary have been in consultation with the
    committee about the promotion of General David H. Petraeus from
    the rank of Major General to be Lieutenant General. The
    President has asked him to return to Iraq where he once
    commanded the 101st Airborne to take on the really challenging
    and vital task of working with strengthening the security
    forces.
        In consultation with my colleague, Mr. Levin, we feel that
    we'll take his nomination out of order, and if confirmed by the
    committee here today, we'll send it to the floor for full
    confirmation. So a quorum being present, I ask the committee to
    consider the nomination of Major General David H. Petraeus to
    be Lieutenant General and Chief, Office of Security Transition-
    Iraq.
        Senator Levin. So moved.
        Senator Clinton. Second.
        Chairman Warner. The nomination before the committee the
    required length of time, so moved, seconded. All in favor say
    aye. [A chorus of ayes.]
        Opposed? [No response.]
        The ayes have it. The nomination is confirmed.
        Colleagues, also, it's the desire of the chair to move
    through this morning the important testimony with regard to the
    budget. Should Senators have questions other than what's
    specifically before the committee this morning, I would ask
    that you defer them and the chair, working with the ranking
    member, will see that hopefully an opportunity is made to have
    our witnesses reply.
        I know, having worked here daily with Secretary Wolfowitz
    and indeed General Pace, that both of you have been
    concentrating on the ongoing business of the building, and as
    such, there are some details about the prison that has been
    handled by the Secretary himself and the chairman, but
    nevertheless, we'll see what occurs by way of desired and
    future questions.
        Senator Kennedy. Mr. Chairman, I must express some
    reservation about that. We've had limited amount of time to try
    and deal with something which is of enormous importance. The
    Secretary was directly informed by the Red Cross about some of
    these allegations and abuses that took place in the prison and
    I have intention of questioning him.
        Chairman Warner. We'll try and make that arrangement.
        Senator Kennedy. I'm glad to conform with the chair, but
    I'd like to be able to reserve my 6 minutes for matters which I
    think are enormously important.
        Chairman Warner. The Senator is heard. I would like to,
    however, continue with the budget hearing and we'll make that
    possible towards the end. Thank you very much.
        Secretary Wolfowitz.

       STATEMENT OF HON. PAUL D. WOLFOWITZ, DEPUTY SECRETARY OF
                                DEFENSE

        Secretary Wolfowitz. Thank you, Mr. Chairman, and members
    of the committee, and I'd like to actually begin by thanking
    you for that speedy action on the nomination of General
    Petraeus. It is a very important appointment to a critical
    post, because as you pointed out, he is going to be pulling
    together all the different pieces involved in training,
    equipping, and organizing Iraqi security forces, which is one
    of the key elements for our strategy for success in Iraq. I
    can't imagine a better qualified individual to take on that
    assignment and I appreciate the speed with which the committee
    has addressed that nomination.
        Chairman Warner. Many members of the committee met him in
    the course of their individual visits to the country of Iraq.
        Secretary Wolfowitz. In fact, Senator, I think one can even
    see in some of the success that's been achieved, in spite of
    the difficulty of recent weeks in Mosul and in the area that
    General Petraeus was in charge of that he has fundamental
    understanding of what it takes to succeed.
        Mr. Chairman and members of the committee, I appreciate the
    opportunity to testify today in support of President Bush's
    request for a $25 billion reserve fund and to receive your
    input on the structure of that reserve.
        Chairman Warner. If I might interrupt you, we'll put into
    the record the statements by each of you in their entirety, and
    we also note the presence at the witness table of Mr.
    Lanzillotta. We welcome you back, a former, very valued staff
    member of our committee, and you're here as they say, as back
    up, is that correct? Thank you. Thank you, Mr. Secretary.
        Secretary Wolfowitz. He's performing efficiently, as you no
    doubt are aware.
        The reserve fund we are requesting will provide an
    insurance plan so that the DOD has adequate resources for both
    its core defense activities and its operations in Iraq and
    Afghanistan. It is critical so that we can avoid any disruption
    in funding for our military forces.
        The DOD's plan had been to cash flow fiscal year 2005
    operations in Iraq and Afghanistan until a supplemental budget
    request could be prepared with more precision in the first
    quarter of calendar year 2005. However, our higher projected
    troop levels increase the risk that certain accounts,
    especially operation and maintenance (O&M) Army, could have
    difficult cash flowing operations beyond the February and March
    time frame in 2005. This reserve fund will eliminate that risk
    and provide a margin of safety.
        The reserve fund would be used primarily for O&M
    requirements, but a portion is expected to be used for force
    protection needs as well. Requirements are likely to include
    fuel for helicopters, tanks, and other vehicles; transportation
    costs for movement of personnel and equipment in and out of the
    theater of operations; equipment maintenance and logistics
    supplies; force protection needs, such as body armor and up-
    armor and high-mobility multipurpose wheeled vehicles (HMMWVs);
    and very importantly, continued momentum to achieve a more
    modular Army and a larger brigade structure in the Army.
        The administration still anticipates submitting a
    supplemental appropriation request to Congress in early 2005 to
    fund the incremental costs for contingent operations in fiscal
    year 2005. But as of today, it continues to be impossible to
    know what our total supplemental funding needs will be for the
    next fiscal year, particularly after the election in
    Afghanistan and after sovereignty is transferred in Iraq.
    Depending on the circumstances, we could face the need for
    either more troops or fewer troops, for more intensive
    operations or less intensive operations.
        Mr. Chairman, support of this request will ensure that our
    wonderful men and women in uniform have the tools that they
    need to continue winning the fight in Iraq, a victory that will
    also make our country more secure. America's commitment to
    success in Iraq was underscored again this past Monday when the
    President visited the Pentagon. As the President said on that
    occasion, the United States has a vital national interest in
    the success of free institutions in Iraq as the alternative to
    tyranny and terrorist violence in the Middle East.
        As we carry out this mission, we are confronting problems
    squarely and we are making changes as needed. Despite recent
    violence, and at a time when so much attention is being focused
    properly on the abuses of detainees in Iraq, we need to
    continue to move forward on all fronts, implementing the
    coalition's strategy to set conditions that will ensure a free
    Iraq that is stable and at peace with its neighbors.
        Our strategy involves three interdependent lines of
    operation to build indigenous Iraqi capacity and to transition
    responsibilities from the Coalition to Iraq rapidly but not
    hastily. While there are lessons to be learned from the violent
    events of the past few weeks, which will affect the way we
    pursue these lines of operation, we think these are still the
    three key elements that will bring us success in Iraq.
        The first line of operation involves building capable Iraqi
    security forces to achieve stability. That is the effort that
    Lieutenant, now Major General Petraeus, will undertake. We have
    redoubled our efforts to recruit, train, equip, and most
    importantly, mentor Iraqi security forces, all five branches,
    the police, the Iraqi Civil Defense Corps, the army, the Border
    Police, and the Facilities Protection Service. Over the next
    few months, our aim is to certify the ability of these forces
    that they are ready to assume greater responsibilities from
    coalition forces.
        Similarly, through technical assistance and mentoring by
    U.S. prosecutors and judges of their Iraqi counterparts, we
    have been helping to build a capacity of the Iraqi criminal
    justice sector.
        The second line of operation involves nurturing Iraq's
    capacity for representative self-government with the aim of
    creating a government that the Iraqi people will feel is
    theirs, and that moves us out of the position of being an
    occupying power.
        While many think that June 30 will be a magical date on
    which the Coalition Provisional Authority (CPA) will suddenly
    transition out of all of its responsibilities to a new Iraqi
    Government, it is actually just one step in the process.
    Already, free Iraqis have been gradually assuming
    responsibility for governmental functions for quite some time.
    Many Iraqi ministries report to the Governing Council rather
    than to the CPA.
        Iraq now has a functioning judiciary. At the local and
    provincial levels, elected assemblies are up and running. When
    the interim government assumes office on June 30, its most
    important task will be to prepare the way for elections to
    establish a transitional government in January 2005, another
    step in the process. That government in turn will be replaced
    by elections for a fully constitutional government at the end
    of 2005.
        The third line of operation involves the reconstruction of
    Iraq's infrastructure and the restoration of essential services
    to provide better lives for Iraqis and put people back to work.
    Iraq has tremendous potential. It has well-educated and
    industrious people. It has fertile land, water resources, and
    abundant natural resources. Our strategy aims to put Iraq on
    course to realizing that potential and setting conditions for
    Iraqis to reap greater prosperity in the future.
        This strategy remains a valid guide to working through new
    realities and uncertainty about events after Iraqis begin
    governing themselves. We have encountered intense armed
    resistance in recent weeks, but that does not invalidate these
    three basic elements of the strategy. In fact, what the enemy
    fears most is that Iraqis will be in charge of their own
    country, and then the enemy will face what that key terrorist,
    Abu Musab al-Zarqawi, called suffocation.
        The surviving hard core elements of Saddam's regime have
    everything to lose from eradication of the old order and the
    prospect of being held to account for their crimes. They and
    the terrorists and foreign fighters with whom they make common
    cause, are tough and ruthless killers, but they have no
    positive vision to offer Iraq, only fear and death and
    destruction. They are trying to destabilize the country before
    it has a chance to stand on its own feet. While we cannot
    inspire fear the way that they do, and we would not want to, we
    offer a hopeful vision of a new Iraq that the great majority of
    Iraqis look forward to. The transition to Iraqi sovereignty and
    elected constitutional government will eventually make the
    enemy's position untenable.
        Let me say a word to thank the committee for its support of
    our request for authority for the commander's emergency
    response program. As I think most of you know, this has been a
    remarkably successful way of helping the people of Iraq and
    Afghanistan and gaining their support for our operations there.
        I'd also like to thank you for providing train and equip
    authority to help us enhance the ability of Iraqi and Afghan
    military and security forces to combat terrorism and to support
    U.S. and coalition military operations, and I appreciate the
    expansion of that authority as we requested to all Iraqi and
    Afghan security forces.
        As I think you know, in the past our military commanders
    have been hampered by the lack of flexible funding for
    indigenous security forces, especially in Iraq. As you move
    toward conference, I ask that you let us discuss with you the
    possibility of building on this important step to adopt the
    fuller authority the President requested, and in particular, to
    raise the ceiling above $150 million.
        In closing, I would also like to thank the wonderful men
    and women who wear the uniform of the United States of America,
    and particularly the nearly 140,000 in Iraq and more than
    15,000 in Afghanistan who serve on the front lines of the
    global war on terrorism. Words cannot adequately express how
    proud and grateful we are for their service.
        I also thank this committee for the strong support given to
    U.S. security and to our military people in your National
    Defense Authorization Bill for Fiscal Year 2005. The
    President's staff and the DOD are still reviewing the details
    and we will provide you our views shortly. We look forward to
    working with you in achieving the best possible support for
    America's Armed Forces and our vital missions around the globe.
    Thank you, Mr. Chairman.
        [The prepared statement of Secretary Wolfowitz follows:]
                   Prepared Statement by Hon. Paul Wolfowitz
        Mr. Chairman and members of the committee, I am happy to be here
    today to testify in support of President Bush's request for a $25
    billion reserve fund and to receive your input on the structure of this
    reserve.
                    the president's $25 billion reserve fund
        The reserve fund we are requesting will provide an insurance plan
    so the Department of Defense (DOD) has adequate resources for both its
    core defense activities and its operations in Iraq and Afghanistan. It
    is critical to avoid any disruption in funding for our military forces.
        The DOD's plan had been to cash flow fiscal year 2005 operations in
    Iraq and Afghanistan until a supplemental budget request could be
    prepared by early 2005. Now, however, our higher projected troop levels
    increase the risk that certain accounts--especially Operation and
    Maintenance, Army (OMA) would have difficulty cash flowing operations
    beyond the February-March timeframe in 2005. This reserve fund will
    eliminate that risk and provide a margin of safety.
        The reserve fund would be used primarily for operation and
    maintenance (O&M) requirements, but a portion is expected to be used
    for force protection needs. Requirements are likely to include:

             Fuel for helicopters, tanks, and other vehicles.
             Transportation costs for movement of personnel and
            equipment in and out of the theater of operations.
             Equipment maintenance (such as lubricants, repair
            parts) and logistics supplies.
             Force protection needs such as individual body armor
            and up-armored HMMWVs.
             Continued momentum to achieve a more modular Army.

        The administration still anticipates submitting a supplemental
    appropriation request to Congress in early 2005 to fund incremental
    costs for contingent operations. It continues to be impossible to know
    what our total supplemental funding needs will be for fiscal year
    2005--particularly after the election in Afghanistan and after
    sovereignty is transferred in Iraq. Depending on the circumstances, we
    could face the need for either more or fewer troops--and more or less
    intensive operations.
              the coalition's strategy to achieve victory in iraq
        Support of this request will ensure that our wonderful men and
    women in uniform have the tools that they need to continue winning the
    fight in Iraq, a victory that will also make our country more secure.
    America's commitment to success in Iraq was underscored again this past
    Monday during the President's visit to the Pentagon with his strong
    statement of support. As the President said, ``The United States has a
    vital national interest in the success of free institutions in Iraq as
    the alternative to tyranny and terrorist violence in the Middle East.
    As we carry out this mission, we are confronting problems squarely, and
    we are making changes as needed.''
        Despite recent violence and at a time when so much attention is
    being focused properly on the abuses of detainees in Iraq, we need to
    continue to move forward on all fronts implementing the coalition's
    strategy to set conditions that will ensure a free Iraq that is stable
    and at peace with its neighbors. Our strategy involves three
    interdependent lines of operations to build indigenous Iraq capacity
    and transition responsibilities from the coalition to Iraq rapidly, but
    not hastily. While the lessons to be learned from the violent events of
    the past few weeks affect the way we pursue these three lines of
    operation, these are still the three key elements that will bring
    success in Iraq.
        The first element involves building capable Iraqi security forces
    to achieve stability. Accordingly, we have redoubled our efforts to
    recruit, train, equip and, most importantly, mentor Iraqi security
    forces--Police, Iraqi Civil Defense Corps, Army, Border Police, and the
    Facilities Protection Service. Over the next few months our aim is to
    certify the ability of these forces, that they are ready to assume
    greater responsibilities from coalition forces. Similarly, through
    technical assistance and mentoring by U.S. prosecutors and judges of
    their Iraqi counterparts, we have been helping to build the capacity of
    the Iraqi criminal justice sector.
        The second element involves nurturing Iraq's capacity for
    representative, self-government with the aim of creating a government
    that the Iraqi people will feel is theirs and that moves us out of the
    position of being an occupying power. While many think that June 30
    will be a magical date on which Coalition Provisional Authority (CPA)
    will suddenly transition all of its responsibilities to a new Iraq
    government, it is actually just one step in a process. Already, free
    Iraqis have been gradually assuming responsibility for governmental
    functions for quite some time. Many Iraqi ministries report to the
    Governing Council rather than the CPA. Iraq now has a functioning
    judiciary to provide equal justice for all. At the local and provincial
    levels, elected assemblies are up and running. When the Interim
    Government assumes office on June 30, its most important task will be
    to prepare the way for elections to establish the Transitional
    Government in January 2005. That government in turn will be replaced by
    elections for a fully constitutional government at the end of 2005.
        The third element involves the reconstruction of Iraq's
    infrastructure and the restoration of essential services that are
    providing better lives for Iraqis and putting people back to work. Iraq
    has tremendous potential. Iraq has well-educated and industrious
    people. It has fertile land and water resources, and it has abundant
    natural resources. Our strategy aims to put Iraq on course to realizing
    that potential and to setting conditions for Iraqis to reap greater
    prosperity in the future.
        This strategy remains a valid guide to working through new
    realities and uncertainty about events after the Iraqis begin governing
    themselves. We have encountered intense armed resistance in recent
    weeks, but that does not invalidate our strategy. In fact, what the
    enemy fears most is that Iraqis will be in charge of their own country,
    and they will face what the key terrorist, Zarqawi, calls
    ``suffocation.''
        The surviving hard-core elements of Saddam's regime have everything
    to lose from eradication of the old order and the prospect of being
    held to account for their crimes. They and the terrorists and foreign
    fighters with whom they make common cause are tough and ruthless
    killers, but they have no positive vision to offer Iraq--only fear and
    death and destruction. They are trying to destabilize the country
    before it has a chance to stand on its own feet. While we cannot
    inspire fear the way they do--and would not want to--we offer a hopeful
    vision of a new Iraq that the great majority of Iraqis look forward to.
    The transition to Iraqi sovereignty and elected constitutional
    government will eventually make the enemy's position untenable.
                           more flexible authorities
        Regarding the special authorities that President Bush requested, I
    thank the committee for its support of the Commander's Emergency
    Response Program (CERP). This has been a remarkably successful way of
    helping the people of Iraq and Afghanistan and gaining their support
    for our operations there.
        I also thank you for providing ``train and equip'' authority to
    help us enhance the ability of Iraqi and Afghan military and security
    forces to combat terrorism and support U.S. and coalition military
    operations. In the past our military commanders have been hampered by
    the lack of a flexibility funding authority that included security
    forces, especially in Iraq. As you move toward conference, I ask that
    you let us discuss with you the need to build on this important step by
    adopting the fuller authority that the President requested.
                                    closing
        In closing, I want to thank all the wonderful men and women who
    wear the uniform of the United States of America, and particularly the
    nearly 140,000 in Iraq and more than 15,000 in Afghanistan serving on
    the front lines of the global war on terrorism. Words cannot adequately
    express how proud and how grateful we are for your service.
        I also thank this committee for the strong support given to U.S.
    security and our military people in your National Defense Authorization
    Bill for Fiscal Year 2005. The President's staff and the DOD are still
    reviewing the details and will provide you our views shortly. We look
    forward to assisting you in achieving the best possible support for
    America's Armed Forces and our vital missions around the globe. Thank
    you.

        Chairman Warner. Thank you, Mr. Secretary.
        Director Kaplan.

      STATEMENT OF HON. JOEL D. KAPLAN, OFFICE OF MANAGEMENT AND
                                 BUDGET

        Mr. Kaplan. Thank you, Mr. Chairman and members of the
    committee, for inviting me to appear before you today to
    discuss the President's request. I do have a full text I'll
    submit for the record, but in the interest of time and because
    Secretary Wolfowitz covered much of what I have to say, I'll
    highlight the key factors that shaped our thinking in working
    with the DOD in putting together the President's request.
        First, we were guided by the President's clear and
    consistent direction, making sure the commanders and the men
    and women in the field have the resources they need to
    accomplish the mission.
        Second, the funding is requested as a contingent emergency
    reserve, with funds activated only after the President submits
    a request designating all or parts of the funding as an
    emergency and essential to operations in Iraq or Afghanistan.
        Third, relatedly, the reserve is intended for operations in
    Iraq and Afghanistan only.
        Finally, I'd just like to note, as Deputy Secretary
    Wolfowitz has, that we continue to plan to come to Congress
    with a full supplemental request for 2005 early next year when
    we can have more precise and reliable estimates of what
    operational needs are likely to be in Iraq and Afghanistan in
    2005.
        Thank you again, Mr. Chairman. I look forward to answering
    the committee's questions.
        [The prepared statement of Mr. Kaplan follows:]
                      Prepared Statement by Joel D. Kaplan
        Thank you, Mr. Chairman and members of the committee, for inviting
    me to appear before you today to discuss the President's request for a
    $25 billion contingent emergency reserve fund for operations in Iraq
    and Afghanistan, which the President formally submitted to Congress
    yesterday.
        In his remarks at the Pentagon on Monday, the President reiterated
    this Nation's commitment to the brave men and women of our Armed Forces
    who are engaged in Iraq, Afghanistan, and elsewhere around the world in
    the war on terror. The President has never wavered in his commitment to
    provide those men and women in the field the resources they need to
    accomplish their missions. Consequently, his direction to us has been
    clear and consistent: make sure the commanders have the resources they
    need to accomplish the mission and protect our men and women in
    uniform.
        It is with those men and women in mind that the President last week
    decided to propose this contingent emergency reserve, to provide the
    commanders and the troops in the field the confidence that the
    resources they need will be there when they need them. This reserve, if
    enacted by Congress, will guarantee we have the ability to respond to
    rapidly changing conditions in the region, while affording the
    necessary time and experience after the transition in Iraq and the
    elections in Afghanistan to ensure that a supplemental request made of
    Congress in early 2005 more accurately reflects real needs.
        There are several core principles that guided the administration's
    request for this reserve. First, it should be made available as a
    contingent reserve activated only after the President submits a request
    designating the funds as an emergency and essential to operations in
    Iraq or Afghanistan. While the levels requested in the 2005 base
    defense request may well be sufficient to meet all operational needs
    until Congress acts on a fiscal year 2005 supplemental early next year,
    the President, based on the advice and recommendations of the Secretary
    of Defense, believed it was prudent to have an insurance policy in
    place.
        Based on our work with the Department of Defense (DOD) and the
    Services, it is clear that they will need to--and can without
    disruption--pull forward funds planned for the second half of the year
    to use in the first and second quarter for operational needs if the
    tempo continues at the current high pace. In the current environment, a
    need to ``cashflow'' from the last two quarters in 2005 has the
    potential to raise concern about the reliability of resources later in
    the year. We wanted to provide commanders, as well as the troops
    serving in the field, with the confidence that nothing will stand in
    the way of the President's pledge to provide them with the resources
    they need to accomplish their mission. A reserve guarantees they will
    have what they need when they need it.
        Second, the reserve should provide adequate flexibility to allow us
    to respond to a fluid operational environment and emerging
    requirements. The DOD and we believe that at the current pace the
    pressure points in planning and executing are likely to develop in the
    Operation and Maintenance (O&M) accounts, and particularly Army and
    Marine Corps O&M. This understanding is reflected in the allocations we
    have requested in the language we sent to Congress yesterday. We also
    are seeking to assure that these resources are matched with transfer
    authority to promptly address changing requirements, including emerging
    procurement requirements related to force protection.
        Third, the reserve should address requirements in Afghanistan and
    Iraq only. We believe the base 2005 request provides ample resources to
    meet requirements unrelated to the critical operational missions in
    Iraq and Afghanistan.
        Fourth, we want to assure that enactment of the contingent
    emergency reserve does not come at the expense of the President's 2005
    base request for the DOD of $401.7 billion. Early in his
    administration, the President determined that predictability in funding
    was critical to fulfilling the DOD's transformation agenda. That
    predictability is even more important now as the Services are asked to
    fully engage in the war against terror abroad even as it fundamentally
    transforms it organization, infrastructure, force, and doctrine. While
    some may argue to shift requirements identified in the 2005 base
    request into the proposed reserve, such a shift risks creating
    uncertainty and disruption in the DOD's planning and execution of key
    national security missions.
        Finally, I'd just like to note that this administration has
    tremendous respect for Congress' Constitutional role, and its
    responsibility, in authorizing and appropriating resources for our
    armed services. It is in deference to this role that we want to make
    sure that the next supplemental request you consider is accurate and
    precise as to the military's needs. Some have recommended that we
    simply extrapolate from today's costs, multiplying those costs over
    some fixed period as the basis for a request. We have found that such
    estimates often mean funds are mismatched with accounts and the
    requirements that actually develop. The combination of a reserve that
    can be activated as needed with a future supplemental built on actual
    2005 conditions assures we will spend what is necessary to support our
    troops and their vital mission.
        Thank you again for the privilege of appearing before this
    committee with my distinguished colleagues. I will be happy to take
    your questions.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Warner. General Pace. Thank you.

    STATEMENT OF GEN. PETER PACE, USMC, VICE CHAIRMAN OF THE JOINT
                            CHIEFS OF STAFF

        General Pace. Mr. Chairman and members of the committee,
    thank you very much. I want to get to your questions as quickly
    as possible. I'd be remiss though if I didn't say thank you on
    several levels. First, to this committee, and indeed to all of
    Congress for your very strong bipartisan support of your
    military. We're on a very difficult mission. You are making
    sure, you have made sure, and you continue to make sure, that
    we have the assets available to get the job done and we thank
    you very much for that.
        Second, to the magnificent young men and women who are in
    fact carrying forth the missions in Iraq and Afghanistan and
    around the world. They are making us proud. To their families,
    whose sacrifices are equal to that of the soldiers in combat.
    Lastly, to the employers of our tremendous members of the Guard
    and Reserve. They have shown incredible flexibility and
    support, and we know that this is a sacrifice for them as well
    and we'd like to publicly thank them for that. Sir, thank you.
        Chairman Warner. I've carefully looked through all the
    documents that have come up requesting that the committee take
    up this issue. I'd like to put this in some historical context,
    so I will start with you, Director Kaplan. This particular type
    of financial arrangement, I'm not talking about the substance
    at the moment for what the funds are needed, it seems to me
    clear documentation, but the mechanism by which this particular
    vehicle was chosen and titled. What is the historical
    precedent, if any, for this type of financing?
        Mr. Kaplan. Thank you, Mr. Chairman. Certainly the first
    element of the character is the account structure which we've
    identified. We've tried to put this into the Iraqi Freedom Fund
    (IFF), which was a creation of Congress in the April 2003
    supplemental.
        Chairman Warner. Yes, I'm familiar with that.
        Mr. Kaplan. Within that account structure, we've tried to
    identify those areas where we think there will be the greatest
    pressure points or are likely to be the greatest pressure
    points as we enter the beginning of the next calendar year. As
    Secretary Wolfowitz mentioned, we had intended to cash flow. We
    want to make sure that in particular the Army O&M accounts, the
    commanders, and the Service, knows that it has the confidence
    that as we get into calendar year 2005, those resources will be
    there.
        So, again, the account that we've identified is the IFF.
        Chairman Warner. It's an existing fund and ongoing
    expenditures are being made out of it. Is that correct?
        Mr. Kaplan. I believe that's correct. Ongoing expenditures
    are still being made out of it, yes, sir.
        Chairman Warner. To what extent was the normal supplemental
    route considered?
        Mr. Kaplan. Mr. Chairman, as many administration witnesses
    and officials have noted, we did consider a supplemental when
    we submitted the President's budget in February 2005. We
    concluded that the best way to proceed would be to come forward
    with a full-year supplemental later in the year rather than in
    the beginning of fiscal year 2005 when we could identify, with
    some reliability and precision, what those needs would be.
        As I said in my testimony, that is still our intention. As
    Secretary Rumsfeld and Secretary Wolfowitz talked to their
    commanders and their Service Chiefs, they concluded that we
    needed to provide some additional assurance that as we
    progressed in the beginning part of the fiscal year 2005 and
    particularly early calendar year 2005, they would have those
    resources. It is still our intention to cash flow, and we
    believe, and the Services believe, as I understand it, that
    that can be done without disruption to ongoing operations. It's
    still our intention to do that. It's just that we want to make
    sure, as we get into the early months of calendar year 2005,
    the Services have the confidence that the money will be there.
    If there is a delay in getting a supplemental in early 2005,
    either because of the congressional calendar or----
        Chairman Warner. Does this procedure give the executive
    branch any advantages of more flexibility over the use of the
    funds in comparison to the normal supplemental, and most
    specifically the funds in the 2003 supplemental? Did you
    designate it?
        Mr. Kaplan. I believe it gives similar flexibility that
    existed in the IFF component of the 2003 supplemental. I think
    that flexibility is important and it does go to why we've
    requested it in this fashion. That again is that we don't know
    right now what the needs are going to be as we proceed later
    into the year. We want to make sure that commanders, the
    Secretary, and the President have the flexibility, after
    notification to Congress, to direct those resources to the
    needs.
        Chairman Warner. So there's flexibility over and above what
    was agreed upon between the executive branch and legislative
    branch with regard to the 2003 supplemental.
        Mr. Kaplan. I think--and maybe Larry can correct me if I'm
    wrong--it's similar flexibility.
        Chairman Warner. Similar's a nice word, but I want to know
    how it varies.
        Mr. Kaplan. I think, Mr. Chairman, that within the IFF
    language----
        Chairman Warner. You think. Does anybody know? Excuse me, I
    don't mean to be embarrassing. Mr. Secretary, would you like to
    deal with this for a few minutes?
        Mr. Lanzillotta. Mr. Chairman, the flexibilities in this
    reserve account as submitted to Congress are the same
    flexibilities and transfer authority that we already have.
        Chairman Warner. Over and above previous procedures?
        Mr. Lanzillotta. The general transfer authority would be
    over and above previous procedures. It allows us as an
    insurance fund to reduce the risk to our ongoing program.
    Normally, to go back to your original point, historically the
    DOD submits a supplemental in late winter, early spring, and it
    is a normal procedure for the Services to cash flow those
    expenses to that time period.
        Chairman Warner. We understand that.
        Mr. Lanzillotta. This fund though will allow us to reduce
    the risks to the program, especially Army O&M, who has an
    exceptionally high burn rate at this point----
        Chairman Warner. We understand that.
        Mr. Lanzillotta.--to restore to the commanders the
    stability and funding that they need to continue their program
    so it'll have no negative effects on readiness.
        Chairman Warner. According to the General Accounting Office
    (GAO), the incremental costs of the global war on terrorism are
    about $5 billion a month. Such a monthly expenditure rate could
    translate into a requirement for $60 billion for the cost of
    the war for all of fiscal year 2005. Do you agree with those
    cost estimates?
        Mr. Lanzillotta. Currently, Mr. Chairman, our operational
    costs in Iraq, a marginal cost right now, is running about $4
    billion. Some months it's $4.1, some months it's $3.9, but it's
    about $4 billion, and Afghanistan has been running between $600
    million to $800 million, but is seeing a downward trend.
    Generally it's about $4.6 billion. This isn't the supplemental.
    This is only an insurance fund and the supplemental will be a
    larger number in the spring.
        Chairman Warner. Why $25 billion? If you used that formula,
    you should have a higher amount for this.
        Mr. Lanzillotta. What this reserve fund will allow the DOD
    to do, when we look at the burn rate, particularly for the
    Army, who is carrying the burden for this burn rate right now
    in the operations, is allow us to ensure that the Army accounts
    have sufficient funding to when we think it is a probable
    outcome to get a supplemental submitted and approved in
    Congress. This would allow the Army to reduce their risk into
    the March/April time frame when a supplemental is likely to be
    approved.
        Mr. Kaplan. If I could just make it clear, it is not
    intended to be the amount that we need for the first 6 months.
    It is intended to allow us to cash flow during that period
    without disrupting key programs.
        Chairman Warner. That's clear.
        Mr. Kaplan. That's the point.
        Chairman Warner. But we want to ensure that Congress has
    its traditional oversight responsibilities to monitor the
    expenditures, and I think we have to focus in very closely on
    how this particular--and I think it's a first of a kind. Would
    that not be correct?
        Mr. Kaplan. As far as I'm aware.
        Mr. Lanzillotta. It's unusual.
        Chairman Warner. Unusual's a different word, but it's a
    first of a kind, and we want to make certain that it is in
    conformity with the traditional practices to the extent we can
    so that we can maintain our oversight.
        Now, my time is up so I cannot pursue other questions.
        Mr. Kaplan. Could I just say one thing to be clear?
        Chairman Warner. Yes.
        Mr. Kaplan. There will be a request for a full year's
    supplemental early next calendar year. It will likely be much
    larger than $25 billion.
        Chairman Warner. There's no question of that, but this is a
    very significant sum of taxpayers' money over which Congress
    must exercise its appropriate oversight.
        Mr. Kaplan. Absolutely.
        Chairman Warner. Senator Levin.
        Senator Levin. According to the letter to the President,
    this contingent emergency reserve fund would be accessed should
    there be a need for additional resources. As a matter of fact,
    your testimony makes it very clear that there will be a need
    for additional resources, isn't that not clear? General Pace,
    is there any doubt in your mind we're going to need additional
    resources?
        General Pace. There is no doubt in my mind, sir.
        Senator Levin. So when the letter reads, ``should there be
    a need,'' you're already fudging. This is your letter, I think,
    Director Kaplan. Or this is Director Bolton's letter.
        Mr. Kaplan. Yes, Senator. The letter states--should there
    be a need to provide additional resources prior to enactment of
    a fiscal year 2005 supplemental that can't reasonably be
    covered by cash flow. We know and we've consistently said there
    will be a supplemental.
        Senator Levin. That's not what the letter says. The letter
    says, ``the emergency reserve fund would be accessed should
    there be a need for additional resources.'' In any event, it's
    clear in everyone's mind we're going to need additional
    resources. We're presently spending about $4.6 billion more
    than we have appropriated for Iraq and Afghanistan. The
    question is, why not consider a supplemental at this time? This
    is not a very great range, by the way. This is not some highly
    speculative expenditure. This is a very obvious expenditure
    that we know we're going to need of about $4.6 billion a month,
    that's pretty precise. Why don't we consider a supplemental for
    that and be honest about it?
        Mr. Kaplan. Senator, the problem is, we really don't know
    what the number is. It easily could be higher, it might be
    lower.
        Senator Levin. If it's higher, fine, we'll have another
    supplemental. If it's lower, fine, don't spend it. But you say
    it's $4.6 billion, I mean, you actually added up the exact
    amount for Iraq, the exact amount for Afghanistan, and it came
    to somewhere around $4.5 or $4.6 billion. That's plenty precise
    for us to consider a supplemental. There's no reason not to be
    direct on this issue and to acknowledge what the costs are of
    this war, and to simply call this a speculative or a possible
    or a contingent emergency reserve fund it seems to me just
    continues to fudge the reality, which is that this war is
    costing us about $4.6 billion a month more than the President
    requested in his budget. I think we ought to have an honest
    presentation of a supplemental request rather than presenting
    it this way. That's number one.
        Number two, in terms of the flexibility, the way this is
    written, it says you divide it among six categories here. Then
    you say that, in addition to the transfers authorized in the
    previous proviso, which are already plentiful, after
    consultation, DOD may transfer funds provided here into any
    appropriation or fund of the DOD. So under this letter, this
    request, the Secretary of Defense, after consultation,
    basically inside the administration, can transfer that money
    from any of those areas to any of the other areas. Is that
    right, Director Kaplan?
        Mr. Kaplan. Yes, Senator, that's correct.
        Senator Levin. This is just a $25 billion blank check.
        Mr. Kaplan. Senator, I don't think so.
        Senator Levin. Where's the congressional control? Do you
    say here that Congress has to approve these expenditures? I
    know there's notice of 5 days. Is there any approval either
    before the expenditure or after the proposed expenditure
    required by Congress?
        Mr. Kaplan. No, Senator, other than the appropriation and
    this committee's authorization.
        Senator Levin. You're asking for $25 billion to go anywhere
    you want.
        Mr. Kaplan. For purposes in Iraq and Afghanistan.
        Senator Levin. For any purpose you determine in Iraq and
    Afghanistan. All this is window dressing. When you allocate $14
    billion for O&M, $1 billion for O&M Navy, $2 billion for O&M
    Marine and so forth, that's just window dressing because you
    can move it from one account to another at your whim. Is that
    not correct?
        Mr. Kaplan. Senator, that's our attempt as we sit here
    today to identify where we think the pressure points are most
    likely to occur.
        Senator Levin. I understand that. But you have the
    authority under--if given the authority--to move that money
    from any account to any other account without any congressional
    involvement other than a 5-day notice. Is that correct?
        Mr. Kaplan. For use in Iraq and Afghanistan, yes, Senator.
        Senator Levin. That's the only limit? Here's $25 billion
    more for use in Iraq and Afghanistan, so these numbers that
    you're giving us are just window dressing numbers.
        Mr. Kaplan. No, Senator, they represent the DOD's best
    estimate today.
        Senator Levin. But they don't limit you expenditure in any
    way, do they?
        Mr. Kaplan. No, sir.
        Senator Levin. All right. So you have an unlimited $25
    billion. That's what this amounts to. I think that's the
    definition of a blank check. I can't think of a better
    definition of a blank check.
        Before my time runs out----
        Chairman Warner. Could we allow Mr. Lanzillotta to answer?
        I'll add additional time so that he can answer the
    question.
        Senator Levin. Sure.
        Mr. Lanzillotta. Senator, what this will allow us to do,
    and we outlined it for the operational cost, we know during
    this period of time that we're going to have operational costs
    and force protection needs. The reason we allowed that
    flexibility, because we're going through the 2004 right now, is
    because when we got very specific as to where the accounts are,
    we were trying to match the money to where the bills are. We
    currently have a stress point with general transfer authority,
    and so what we were trying to do is find that balance with
    Congress, because we know we need to support the operational
    costs and force protection costs as they happen on the ground
    and have the flexibility to deal with that, especially the
    force protection, without going through lengthy processes which
    would delay us getting that equipment to the troops in Iraq.
        Senator Levin. I understand. That's exactly what Director
    Kaplan said basically. But you need to understand, you're not
    talking about balance with Congress here. You're talking about
    $25 billion for Iraq and for Afghanistan, and you can spend
    that in any way that you want. By the way, you don't provide
    any personnel costs to those additional 20,000 troops, which is
    another problem I have with this.
        But because I'm going to run out of time, this is the
    definition of a blank check. I think most of us want to provide
    funds. We want a supplemental. It's pretty ironic here. We've
    been trying to pressure this administration to cough up a
    request for the additional money, and to come forth with a
    reasonable request for additional money. The administration
    refused to do that until now, and this is what we get as a
    result of all our effort to have some responsible budgeting for
    the cost of this war. It's Congress which has said this war's
    costing $5 billion a month at least more than you have
    requested. That's not responsible budgeting. Give us a
    responsible request. It hasn't been forthcoming until last
    night and this is not responsible because it's just a blank
    check for $25 billion.
        So in terms of balance with Congress, there's no balance
    here. There's no balance here at all that I can see.
        Here's my last question, and Secretary Wolfowitz, it seems
    to me you opened up an area of questions with your opening
    statement. I must say your opening statement is not limited at
    all to the budget issues in front of us. I understand the
    chairman's desire to have this be a budget hearing, and I think
    that is what it should be too, but your statement, Mr.
    Secretary, went way beyond budget issues, and it seems to me it
    is then appropriate that people use their time if they want to
    ask you questions about what you testified to here this
    morning.
        I want to ask you just one question about the prison
    situation in Iraq.
        Chairman Warner. I'm just going to ask if Senator----
        Senator Levin. I think his statement opened this up. His
    statement was not limited to budget numbers. His statement was
    an argument for the administration's whole position in Iraq, it
    was not just a budget presentation. So I think, Mr. Chairman,
    that in fairness, if we're going to hear an opening statement
    like that, that Senators ought to have an opportunity, if they
    want to use their time, to ask questions of Secretary Wolfowitz
    on the subject of Iraq, because he went way beyond the budget
    issues which we were supposed to be talking about this morning.
        Chairman Warner. I suppose that this is the responsibility
    of the chairman. The notice that went out to all members was
    related to the budget hearing. Many members are here for that
    purpose. I'd like to contain the questioning to the questions
    of the budget, and as soon as that is over, we will then
    recognize members for the purpose of asking other questions. I
    thank the indulgence of all members.
        Senator Levin. Well, then, I have one question.
        Chairman Warner. Well, I----
        Senator Levin. No, this is my question. It's not my
    substantive question, it's my procedural question. Did
    Secretary Wolfowitz get a copy of the notice of this hearing?
    Because he sure didn't comply with the notice of this hearing
    in his opening statement.
        Secretary Wolfowitz. Senator Levin, I thought since we're
    asking for funding for operations in Iraq that it was
    appropriate to say something about the purposes of those
    operations.
        Senator Levin. Thank you, Mr. Chairman.
        Chairman Warner. I thank the indulgence of my members. I
    will not take further time. I'll put into the record at this
    place my own study of the reports by Congress with reference to
    the October 23 conference report on the IFF and the April 12,
    2003 report, in which language is adopted by Congress, I think
    closely related to what you're here for today. I'll ask those
    be placed in the record.
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Chairman Warner. Senator McCain.
        Senator McCain. Thank you, Mr. Chairman. I believe that
    every member of this committee wants to provide the executive
    branch with whatever funds are necessary to prosecute the
    conflict in Iraq in the most successful fashion. But I am very
    troubled because I have never seen a request that basically
    outlines some priorities and then states that it can be ``used
    for any fund.'' I've never seen anything like that, Mr.
    Chairman. There may be some precedent for it, but I agree with
    Senator Levin's characterization. This is a blank check.
        I am intrigued that there's no mention in this set of
    priorities, Director Kaplan, about the increased personnel
    costs. We have 20,000 additional personnel there now. I think
    we need more. I said we needed more 9 months ago when the
    unanimous response was, well, the commanders on the ground
    haven't asked for them, which is one of the most disingenuous
    answers I've ever heard in response to what was clearly a
    requirement, which we're paying a very heavy price for right
    now, lack of enough sufficient troops on the ground.
        So now we're going to give you $25 billion, which by the
    way, just a very short time ago it wasn't going to be needed in
    testimony, now we're going to give $25 billion, and I'll give
    $50 billion, I'll give $100 billion. But it seems to me, Mr.
    Chairman, that we do have an oversight responsibility as to
    where this money is spent. I don't think that all of that money
    has been well spent in the past.
        So I guess my first question is, what about personnel
    costs, Mr. Secretary? I hope I'm within the confines of the
    chairman's narrow interpretation of what this hearing is all
    about. Do we need more troops, and if so, how many?
        Secretary Wolfowitz. Senator McCain, I think on personnel
    costs we're talking about an account that is large enough that
    we think we can cash flow until we have a clear idea of how
    many troops we need. You're absolutely right. We needed more in
    the recent months than we had anticipated and we don't know
    what we're going to need next winter or next spring, but by
    next January we should have a much clearer idea of it.
        The Army personnel account is large enough, I believe, and
    I'll ask Mr. Lanzillotta to correct me if I'm wrong, not to
    create that problem. Army O&M is only $26 billion, and at the
    rate we're going to be consuming our Army O&M, we can run into
    serious problems early next spring without this kind of reserve
    available.
        Let me emphasize this is not any number designed to get us
    through any fixed period. It is a number designed to allow us
    to cash flow in a responsible way without breaking the momentum
    of the key Army modularization program or requiring us to short
    change the troops on things they need in the field.
        Senator McCain. I won't take up the time of the committee,
    Mr. Chairman, except to say that I have never seen a request
    exactly like this. If we want to, again, give up all oversight
    responsibilities, which apparently is the case, then that's the
    wish of the majority to do that. I want to give them sufficient
    funding. I think they're going to need more money. I think they
    need a lot more than $25 billion given the tempo of operations,
    but the way I read this proposal is that we will be notified
    perhaps within 5 days and that will pretty much sum it up.
        This committee has become a very interesting debating
    institution, but I don't know where our oversight
    responsibilities lie, and I hope that at some point we would
    respond to our constituents' desire to have much more careful
    scrutiny over this conflict and the way it is being conducted
    and the mistakes that have been made which have led us to a
    situation which I think is very grave at this particular point
    in the history of this conflict. I have believed from the
    beginning and believe now, it is of the most vital importance
    to the future of the world and our democracy and freedom that
    we win in this conflict.
        I don't believe very frankly, Mr. Chairman, that we are
    playing nearly the role that is our constitutional
    responsibility to carry out. Thank you, Mr. Chairman.
        General Pace. Mr. Chairman, may I take a minute and just
    add a bit more information on the troop strength? Because,
    Senator McCain, you are absolutely correct, sir. It would be
    disingenuous for any of us in a leadership position to simply
    take numbers from the field and either say, that's what they
    need or that's what they don't. You are correct, sir.
        I will speak for myself. I am a member of the Joint Chiefs
    of Staff. I have a responsibility to absorb the data that first
    General Franks gave to us and now General Abizaid is giving to
    us, to do my own analysis, and to provide my best guidance--
    correction, my best recommendations.
        As recently as this past Monday, the Joint Chiefs met via
    video teleconference (VTC) with General Abizaid, and we
    reviewed his plans for the coming months and his request to
    maintain the current 19,000 to 20,000 man increase for the
    foreseeable future. I personally, and we collectively, agreed
    with that assessment, is not to lay this on the commanders in
    the field. It is a responsibility of us collectively as leaders
    to absorb that data and to make judgments.
        Senator McCain. I sure wish the answer hadn't been for
    months, when those of us who believed that we needed more
    troops, and the answer was, that, the commanders in the field
    haven't asked for it. That was the response given for the
    record on 50 to 100 occasions. Again I want to emphasize, I
    want us to do everything possible to help you win this
    conflict. I mean that with all sincerity. I am concerned about
    where we are in this conflict today. I believe we can and will
    still win it, but I wish we played a more participatory role,
    not because of my own ego, but because I believe the
    Constitution has deemed that we do so.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator.
        Mr. Kaplan. Mr. Chairman, may I clarify something for the
    record?
        Chairman Warner. Gentlemen, I have to continue.
        Mr. Kaplan. Sorry.
        Chairman Warner. Senator Kennedy, I appreciate your
    indulgence to defer----
        Senator Kennedy. Mr. Chairman, I want to just point out in
    the Secretary's statement, he talks on page 2 about Iraq's
    capacity for representation. He talks about assuming
    responsibility for governmental function. He talks about a
    functioning judiciary. He talks about elected assemblies. He
    talks about preparing the way for elections. He talks about
    reconstruction of Iraqi infrastructure. He talks about fertile
    ground, water resources, and natural resources. In his first
    page, he says, ``despite recent violence at a time when so much
    attention is being focused properly on the abuses of detainees
    in Iraq,'' I think I'm entitled to ask my question and I intend
    to use it for the 5 minutes.
        Chairman Warner. Senator, I respectfully ask that you
    indicated you'd be willing to defer----
        Senator Kennedy. Excuse me, Mr. Chairman, I didn't. I
    recognized that you mentioned that comment, but I've been on
    this committee for 24 years, I've been in the Senate 42 years,
    and I have never been denied the opportunity to question any
    person that's come before a committee on what I wanted to ask.
    I resent it and reject it on a matter of national importance.
    We're talking about prison abuses, we're talking about the Red
    Cross meeting with Secretary Wolfowitz in January of last year,
    we're talking about published reports about this, we're talking
    about what he did do and what he didn't do, and the activities
    as the number two person in the DOD, and we are entitled to
    answers, Mr. Chairman. I'm going to use my 6 minutes.
        Chairman Warner. I indicated to you I would recognize you
    immediately upon the conclusion of the first round.
        Senator Kennedy. Mr. Chairman, then you're going to have to
    rule me out of order and I'm going to ask for a roll call of
    whether the committee is going to rule me out of order. I think
    I am entitled to ask a question on a subject which is relevant
    to his testimony on it. I'm entitled to that, Mr. Chairman.
    This is the United States Senate.
        Secretary Wolfowitz. Senator Kennedy, I'd be happy to
    answer your question about the meeting with the Red Cross.
        Senator Kennedy. I'd appreciate it.
        Chairman Warner. You have opened the inquiry broader than
    the scope that was the intended, Mr. Secretary, so I expect
    that the Senator has a point. It had been my intention to
    conduct this hearing on the budget. That was the notice, that
    was the purpose, and then at the conclusion of the testimony on
    the budget, I was perfectly willing to allow Senators to ask
    other questions.
        Secretary Wolfowitz. Sorry. I'll do it your way, Mr.
    Chairman.
        Chairman Warner. You have opened it up in your opening
    statement to I think any legal construction, you've opened it
    up to all issues.
        Senator Kennedy. We're limited by our 6 minutes.
        Chairman Warner. I will not detract from your time.
        Senator Kennedy. I appreciate it.
        Chairman Warner. So let us proceed with your 6 minutes at
    this time.
        Senator Kennedy. I want to say, Mr. Chairman, at this time,
    you've always been a respected chairman. Once in a while we get
    worked up around here.
        Chairman Warner. That's all right. That's the way the
    committee should work. But I see the point that you and the
    ranking member make.
        Senator Kennedy. Thank you.
        Chairman Warner. But I would hope that we could continue on
    this budget and then have a second round.
        Senator Kennedy. Thank you, Mr. Chairman, and thank you,
    Mr. Secretary, for your willingness to address this issue. The
    question I have is, as you saw in The New York Times report
    this week, the President of the Red Cross was here for 2 days
    in January to talk with the State Department, Secretary Powell,
    Condaleeza Rice, and yourself about detention problems. At
    least on their calendar, and my conversations and contacts with
    the President, he raised the detention issues at Guantanamo as
    well as in Iraq. He didn't get into the specifics as your aide
    has reported, but he raised the issues of abuses in Iraq jails.
        My question to you is, when those issues were raised to
    you, what did you do about it? You came here about 5 weeks ago
    and made a very eloquent statement about human rights issues,
    about the concern that the administration had about the abuses
    of the previous regime which was very legitimate, but there was
    no mention of any of the violations or the problems in Iraqi
    jails. My question to you is, when the head of the Red Cross
    briefed you that there were going to be problems, and that
    there was going to be a report later in February, what did you
    do? You heard the bells go off. Did you ask to read the
    previous reports in the DOD? Did you ask for an early report
    from the Red Cross so that you would have been alerted on
    February? Did you check with the DOD to find out that this is
    just the time that Sanchez was supporting Taguba to do an
    independent report already in the DOD, and that actions were
    already being taken?
        What did you do at that time when you as the number two
    person in the DOD had this notification by the Red Cross?
        Secretary Wolfowitz. Mr. Chairman and Senator Kennedy, I'm
    as horrified as anybody at these abuses, and I think Secretary
    Rumsfeld has made it clear just how horrified he is, how
    seriously he takes this issue, how determined he is to find out
    what has happened to make sure that in an appropriate legal
    fashion we deal with people who have committed offenses, and
    that we find out what we need to do to prevent these kinds of
    things from taking place in the future.
        At the same time, we have incredibly important business at
    DOD to run. He's designated a considerable number of officials
    to assisting him in getting to the bottom of this whole issue
    and to going through hours of testimony before this committee
    and other committees of Congress, and hours and hours of
    briefings from the various investigations that have been
    launched, and I would emphasize launched by the Army and by the
    DOD, and it's a very time-consuming business.
        He's asked me and General Pace to make sure that the
    remaining business of the DOD, the critical issues of training
    and equipping and making sure our forces have what they need,
    and most of all that our forces in the field have what they
    need, that those things are being properly staffed, and he
    specifically asked the two of us to focus on that.
        I can't answer in detail on those issues. I can tell you I
    do remember the meeting with the chairman of the Red Cross, and
    I took it very seriously. My recollection of it was that it was
    entirely about Guantanamo. There are some serious issues
    between us and the Red Cross about Guantanamo. I might
    emphasize they have nothing to do with the kinds of abuses that
    we've been hearing about in Iraq. The central issue is this
    issue that everyone is aware of is the impact of long-term
    detention. That's not the issue in Iraq.
        The abuses that took place in Iraq were clearly outside of
    anything that was authorized in any circumstances anywhere by
    U.S. military officials.
        Senator Kennedy. My time is up, but your own staff, Charlie
    Cooper, indicated that the Iraqi prison issue was discussed at
    that time.
        Secretary Wolfowitz. Some people in the meeting believe
    that the chairman of the Red Cross mentioned that there was a
    report coming on Iraq. I honestly don't remember.
        Senator Kennedy. There was no follow-up, no further follow-
    up from your own people?
        Secretary Wolfowitz. We were waiting for it.
        Chairman Warner. Thank you very much, Senator Kennedy.
        Senator Inhofe.
        Senator Inhofe. Thank you, Mr. Chairman. I might add that
    after listening to all the testimony, there are 7 people
    responsible primarily for the problems that existed. They are
    all in some stage of prosecution under the Uniform Code of
    Military Justice (UCMJ) at this time, and I might add they were
    before any of this came to the public's eyes. That was already
    underway and that was done swiftly.
        In your opening statement, you may have addressed this, I
    just have one question. Your requests are entirely of funds
    allocated to O&M accounts, and yet there are some other areas
    that we know are going to have to be covered like some of the
    equipment that's been destroyed and so forth. Do you have a way
    of using this for those purposes that become necessary?
        Mr. Lanzillotta. Senator, this was just meant to be a
    bridge account to allow us to support operational costs and
    force protection costs. Equipment losses and some of the major
    expenses that we're incurring will be in the full supplemental
    request that would be submitted later.
        Senator Inhofe. That's good. Let me use this opportunity to
    recall something that happened 3 years ago. I think it was
    during the Secretary's confirmation hearing, I asked a question
    about the problems we seem to have, and I've experienced this,
    not for 42 years, but for 18 years, that it always seems like
    we're under crisis control. Something will come up and all of a
    sudden we're going to have to come up with the money and we're
    going to have to do it. I remember during the 1990s, in order
    just to get bullets, some of the training commanders were
    actually taking money out of their real property maintenance
    (RPM) accounts, but I think they call it something else now.
    Consequently, we didn't have roofs on our barracks down at Fort
    Bragg and different places. So it's also kind of in a crisis.
        I asked the question of Secretary Rumsfeld at that time,
    how can we overcome this, looking down the road, not just
    looking at today and the problems today? I'd like to ask you to
    being doing that. He said, if you go back all throughout the
    20th century, the percentage of gross domestic product (GDP)
    that went to the defense budget has been an average of 5.7
    percent on non-war years. That slowly went down in the 1990s to
    2.7 percent. Now I understand the most current percentage is
    3.6 percent.
        At that time, he said, I think we're going to have to look
    at it someday in order to be able to resolve these problems and
    not always be meeting at a crisis, around 4.5 percent. I would
    only observe that what he said 3 years ago seems to have been
    pretty prophetic, because it seems to be that way to me. I
    would just hope that your staff as time goes by might look to
    the future, and look where are we going to be 10 years from
    now.
        By the way, General Pace, our mutual friend from Texas
    called the other day and sent along his best wishes to you and
    his congratulations for the great job you're doing.
        General Pace. Thank you, sir.
        Senator Inhofe. Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much. Senator Lieberman.
        Senator Lieberman. Thank you, Mr. Chairman, Mr. Secretary,
    General, Mr. Kaplan, and Mr. Lanzillotta. Mr. Secretary, on
    this Senate Armed Services Committee you have Senators who have
    been steadfastly and fervently in support of our military
    involvement in Iraq, you have members here who are skeptics
    about it, and you have some who have been opposed to it. But
    there's not a member of this committee that doesn't want to
    provide our military with the resources they need to do the job
    that you and we are asking them to do.
        In that regard, having listened to Senator Levin and
    Senator McCain, with whom on this matter I agree, I believe
    we're heading into a situation that is already conflicted
    enough and difficult enough, and into an unnecessary
    disagreement about whether this money is provided through this
    committee and Congress by a reserve fund, which is very
    unusual, and perhaps unprecedented, or through a supplemental
    request.
        Of course, the skeptics will say that the administration is
    doing this because people were demanding in Congress all along
    that you come in with a supplemental and because you didn't
    want to yield to that, you're calling it a reserve fund. In the
    interest of achieving some unified ground here in pursuit of
    what I believe we all support, which is adequate resources for
    our personnel in Iraq, would you consider reshaping this
    request as a more traditional request for supplementary funding
    for the war in Iraq?
        Secretary Wolfowitz. I think the problem, Senator
    Lieberman, is, if you start to do that, then you start to try
    to predict the unpredictable, and you either underestimate what
    you're going to need and then that has consequences. When you
    later come in with a larger number, then people say, you
    weren't honest with us or you got it wrong. If you overestimate
    what you need, you end up with money that doesn't get spent
    wisely, and frankly, not only are we not pretending this is not
    the supplemental, we're not pretending this is 6 months of the
    supplemental. It is very likely, and you can do the arithmetic,
    Senator, we're not hiding the bill on what we're spending now.
    It's roughly--and I'm not using the precise $4.4 billion--it's
    roughly $4.5 billion, or if you add in some other things, it's
    pushing closer to $5 billion a month. It is $50 to $60 billion
    if you look at all of our operations in Iraq and in
    Afghanistan. It's a big bill.
        We'll manage much better if you will give us the time to
    wait until early next year when we really know what that bill
    is going to be. If it turns out miraculously, or happily, to be
    significantly lower, it will be much better to ask for a
    smaller amount. If it turns out to be higher, we will ask for a
    larger amount.
        This is a war. It's a war in Iraq, it's a war in
    Afghanistan. War is unfortunately a very unpredictable
    operation, and we're not pretending that we are predicting, and
    we're not pretending it's cheap.
        With respect if I might add too, to this issue about a
    blank check. We're not looking for a blank check. We are
    looking for the kind of flexibility that will make sure that
    when a need arises we can allocate funds to where that need
    exists.
        Senator Lieberman. I hear you, and I understand what you
    are saying, but I want to repeat what I said before. We're
    heading down a road to an unnecessary fight in a circumstance
    where that battle may do damage to our cause and may lead
    others to question more than they should the willingness of
    Congress to support our troops regardless of the individual
    attitudes of Members of Congress on this.
        We all agree. You've said it, all of you on the panel, we
    know it. This is not a supplemental request for all the money
    we're going to need to prosecute the war in Iraq through the
    end of fiscal year 2005. But the answer to that is just to come
    in with a partial supplemental request. We all know that, and
    we won't be deceived by it. We know that there's going to need
    to be one more coming in next year. I just worry that we're
    heading down a road here where we all ought to be unified,
    where we're going to hear a lot more use of the term blank
    check, and more conflict over this than I think we need to
    have.
        Therefore, I got your answer, and I just want to ask you to
    go back and speak to the Secretary and perhaps the White House
    about whether this is really a fight you want to fight.
        I want to go briefly, if I can, to the prison abuse scandal
    which troubles us all. Here's another case where no matter
    where you stand on the war, everybody agrees this was horrific,
    unacceptable, damaging behavior.
        Chairman Warner. If the Senator would indulge me. I don't
    intend to prolong this, but the chair did ask with regard to
    the restriction by members, in no way have I ever in my 26
    years in the Senate tried to curtail a Senator's right to
    question. But it was pointed out, and I wasn't fully aware of
    your opening statement, as we would say in the law, opens up
    the subject. As such, the chair hereby withdraws the request to
    the members to confine their questions to matters related to
    the budget.
        I did not want to go to a vote because I know how to count
    votes. Having said that, the chair withdraws that admonition,
    but bear in mind, we're here on the question of this budget. I
    do not deduct from the time of the Senator.
        Senator Lieberman. Thank you.
        Senator Levin. Could I just add one quick comment and also
    request it not be deducted. I just want to thank the chair.
    He's always very reasonable, a gentleman, and maintains the
    dignity, decorum of this committee, and the good relations of
    our members sometimes under very difficult circumstances. I
    just want to commend him publicly for the way he is able to do
    all that at the same time.
        Senator Dayton. You'd have all the votes on that one.
        Chairman Warner. I thank my good friends. I always remember
    Yogi Berra said good guys finish last. I'm still trying to
    place up here.
        Senator Levin. You'll finish first by that standard, Mr.
    Chairman.
        Chairman Warner. Go ahead.
        Secretary Wolfowitz. If I might just say it, I addressed
    the issues I did in my opening statement because I think it is
    perfectly proper for the committee to ask what the $25 billion
    is being used for. As I said earlier, if you want to get into
    the issue of the prisoner abuse scandal, you really need to get
    people who are able to devote pretty much full time to digging
    into the facts, and we have multiple officials who've been
    testifying over 20 hours on those issues.
        Chairman Warner. I indicated at the beginning of the
    hearing, that you and I, in the course of our conversations
    preparatory to this hearing, said that your full attention
    really had been put on the maintenance of the DOD and the
    everyday demands, together with to a great extent General Pace.
    Is that correct, General? But the questions will be asked and
    you'll respond to the best of your knowledge. Thank you very
    much.
        Senator Lieberman. Mr. Chairman, thank you.
        Chairman Warner. Your time is restored. You have another
    minute.
        Senator Lieberman. I appreciate it. One question, and I'll
    try to draw a line from your initial purpose to the wider
    agenda now, and it is this: to support and maintain public and
    congressional support for the troops and the mission, it seems
    to me that we have to guarantee that there is the widest and
    most unfettered investigation of how the prison abuse scandals
    happened, including up the chain of command, to look wherever
    responsibility for action or inaction should be placed.
        I wanted to ask you in that regard whether you think the
    various investigations going on now have the latitude to do
    that. Particularly, I thought one of the most important things
    Secretary Rumsfeld said last Friday, which was lost in the
    coverage of his testimony, was the creation of the four-person
    independent investigating group with Secretaries Schlesinger
    and Brown, General Horner, and former Congresswoman Fowler.
        Am I correct that they will have independent staff and that
    they will independently review the other investigations,
    including any culpability, and not only by those in the prisons
    but up the chain of command?
        Secretary Wolfowitz. Senator, this is where I feel I'm not
    sufficiently informed on the details to give you a confident
    answer. I'd like to give it to you for the record. I think the
    answer is yes, but I'd like to confirm it. I think they also
    have the ability to recommend additional investigations if they
    think additional investigations are needed. I will confirm that
    for the record.
        [The information referred to follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Lieberman. General Pace, do you have a response to
    that?
        General Pace. Sir, I have not read the document, if there
    is one, that the Secretary may have signed on that to the
    members. I do know that in the discussions leading up to it,
    the concept was that these would be four individuals who would
    have the opportunity, the authority, and the support to take
    all investigations, no matter what level they were derived
    from, read them, look at them, cross-reference them, and make
    recommendations to the Secretary about what other
    investigations might be needed to flesh out the story. I do not
    know the specific guidance he has given to the individual
    members.
        Senator Lieberman. I thank you and I just say finally that
    as a supporter of the war, I think it is critically important
    that at some level, and that looks to me like the most natural
    level, there be that independent review by people outside of
    the Pentagon who can guarantee the American public and the
    world that they have looked without limits at anyone who may
    bear a blame for this scandal and hold them accountable.
        I thank you, Mr. Chairman. You're both a winner and a good
    guy as far as I'm concerned.
        Chairman Warner. Thank you very much. Senator Allard.
        Senator Allard. Thank you, Mr. Chairman, and I just want to
    say that along with all my colleagues here on this committee
    that have stated that they fully support our men and women in
    Iraq and Afghanistan and really respect the great job that
    they're doing, we want to make sure that the money that we're
    making available has some oversight, at least as far as
    Congress is concerned. We've had this discussion on the Budget
    Committee on which I serve, Mr. Chairman. We have worked out a
    solution which I thought might take care of your concerns. I
    can understand when we have a supplemental, everybody adds
    their own projects because they're outside the budget and it
    gets abused. There are members on this committee who have
    abused that and there are Members in Congress who have abused
    that, because it goes beyond what was intended in the
    supplemental. It ties it up, and it doesn't make dollars
    available for the DOD. I can understand all that concern.
        But on this side, we need to have some oversight. So what
    the Budget Committee came up with in their resolution--this is
    another reason why we need to get it passed--is a provision
    where the committee set aside $30 billion to go through a
    process where you make your request to the Committee on
    Appropriations, and then the Appropriations Committee is in a
    position to manage that request. That expedites the procedure
    so you don't have a supplemental out here that gets abused. It
    goes ahead and makes the process move much faster, so that as
    your needs come up you can go ahead and make those requests to
    the appropriators and they can make the money available to you.
        It seems to me like that's a reasonable approach. It's
    Section 312 in the Budget Committee that we're working to get
    passed, and I wish you'd take a look at it. Maybe you'd like to
    comment further on this approach. Maybe General Pace would like
    to comment. You can perhaps comment on it, Mr. Secretary, and
    even Director Kaplan, would maybe like to comment on that
    provision.
        Secretary Wolfowitz. Let me just say first I think you're
    absolutely right that it is important. There's a temptation
    when you have emergency accounts available to start using them
    for things that are not emergencies. I think it was Senator
    Inhofe who correctly pointed out that when Secretary Rumsfeld
    testified here in his confirmation hearings and in the summer
    of 2001, we were working very hard to make sure that we stopped
    funding regular expenditures and pretending that they were
    emergencies. It had very bad effects on the management of the
    DOD.
        The other side of the coin is if you over budget for
    something that you predict is going to be an emergency 12
    months from now, you're inevitably going to have people using
    those funds in an undisciplined way. I think that's the
    philosophy for waiting until part way into the fiscal year when
    we have a better fix on things.
        I'm not familiar with the vehicles and I think Director
    Kaplan might want to address that.
        Mr. Kaplan. Senator, we're of course appreciative of any
    efforts and ideas that Congress has to provide expedited
    procedures to make sure that the flexibility exists to get the
    resources where the DOD and the commanders say they need them.
    We want to be mindful of course of the appropriators, their
    ability to consider these requests, and expect that they will
    act on this contingent emergency reserve fund as well as the
    ultimate 2005 supplemental.
        If I may back up for a minute, I think I may have led to a
    bit of confusion by my imprecision of language in saying that
    this proposal was similar to the IFF. I didn't have the
    language in front of me. But it is in fact modeled after the
    IFF that Congress created in the fiscal year 2003 supplemental.
    It identified several accounts and said money shall be
    available for transfer for the following activities, and then
    proceeded to say not less than up to several enumerated
    specific accounts. It then provided that in addition to those
    transfers, the Secretary of Defense may transfer the funds
    provided herein to appropriations for military personnel, O&M,
    overseas humanitarian, disaster assistance and civic aid,
    procurement, research and development (R&D), and proceeds to
    list, actually in some ways a more expansive list even than
    we've asked for because it goes outside of the fence.
        So we were mindful of Congress' prerogatives and recognized
    that that was something that Congress had supported and created
    in the past.
        Senator Allard. I want to emphasize again that this
    provision we have in the budget, which is an agreement between
    the House and the Senate, is to accommodate incremental
    expenditures associated with ongoing military operations in
    Iraq and Afghanistan, and this is just exactly what you're
    asking for. There's $30 billion that we're setting aside in
    there to do that, and then the only caveat that we have here is
    that you just go to the appropriators and explain the items
    that you want to use that for, and the appropriators can make
    that available.
        It seems to me like we have the proper balance between
    congressional oversight. It becomes a part of our budget
    process, so we have accountability there. It meets your needs
    as you run across these incremental expenditures, so you can go
    ahead and make those requests and the appropriators can provide
    them.
        Mr. Kaplan. Senator, I think that's not inconsistent with
    what you and the Budget Committee have----
        Senator Allard. It is inconsistent in this regard in that
    we do have some oversight there, which I don't believe we have
    in the provision that you're asking for. But I don't think it's
    excessive oversight. I think that you can rapidly get a
    decision from our appropriators when you need those dollars.
        Mr. Chairman, thank you.
        Chairman Warner. Thank you very much, Senator.
        Senator Levin. What was their answer?
        Senator Allard. I'm not sure that I asked a question. We
    were just having a discussion here and I was explaining how I
    felt like this provision that we have in our current budget
    right now would work and would work in an expedited way so that
    we would have congressional oversight and they could have the
    resources they need there for those incremental expenditures
    that come up that need to be met on a rather urgent basis.
        Senator Levin. I agree.
        Senator Allard. Fiscal year 2005 is what this is providing
    for.
        Chairman Warner. The chair recognizes Ben Nelson.
        Senator Ben Nelson. Thank you, Mr. Chairman, and thank you,
    gentlemen, for being here today. I think it's important to say
    as others have that we certainly want to support the needs of
    our men and women in uniform, both here and abroad,
    particularly as it relates to the continuing costs associated
    with the war in Iraq and the war in Afghanistan, and we need to
    fund the needs.
        But I also agree with my colleagues that the process is at
    the very least confusing, and at the very worst it looks like
    it might be a complete, or if not complete, partial erosion of
    oversight responsibility which causes us all some concern. I
    don't think anybody sitting here wants our oversight to morph
    into a blank check scenario, so that's why I think there is a
    lot of concern and there are a lot of questions that are being
    asked regarding this.
        But think of the confusion. We have budget supplements, and
    insurance funds that are not supplements, intended to cash
    flow. We have a burn rate that conceivably will utilize the $25
    billion in a fairly short period of time, and a request for
    flexibility in the midst of what we provide for accounts.
        So if we're not confused, that will surprise me, and I
    suspect that there is some effort underway to try to help us
    understand that. It's hard to accept in the halls of Congress
    making a budget the way you make a pie, a piece at a time. We
    think we have a budget, but then we find out we don't have a
    budget. Nevermind the fact that whatever we do can be changed
    with 60 votes, so it's hard to call anything permanent, let
    alone temporary.
        I guess what I'm really trying to get to is that I'm not
    adverse to block grants. My question would have to be, how
    realistic is the figure $25 billion? Just how realistic is
    that? We have a burn rate at nearly $5 billion, depending on
    how you account for it, so why would we do it for 5 months? I
    do understand the importance of not leaving money on the table
    for a longer period of time than you would account for under
    most circumstances because money does get spent. When I was
    Governor I used to worry about the legislature spending it. Now
    I see the administration worrying about the administration
    spending it because of the money being there.
        But how realistic is this figure of $25 billion? Any one of
    you can answer. I'm not trying to pick on you, Mr. Secretary.
        Secretary Wolfowitz. Let me try and when I mess it up I'll
    go to the experts. Senator Nelson, I don't think the idea is
    that we'll go $5 billion a month out of the $25 billion until
    that runs out. The idea is that we will cash flow, where
    accounts are adequate, and they're all adequate to transfer, to
    use up some fourth quarter money in the first and second
    quarters.
        Where we don't want to end up is in a position, and there
    are particularly some Army accounts where you could be in this
    position, where by in the middle of the second quarter you're
    already using third quarter money. Then you start to discipline
    your expenditures in a very harmful way. You break programs,
    you short people on things, and you cut corners in the way any
    business will cut corners if they see themselves heading into a
    financial crunch. We don't want that kind of thing to happen.
        Senator Ben Nelson. But can we have the assurance that the
    kind of assets that are required, such as the appropriate armor
    for vehicles or for personnel, the number of personnel that
    we're looking to increase to take care of the continuing
    mission or changing mission as we go along, will be funded? I
    think that's our fear.
        One of the issues about having some oversight is being able
    to direct where the money is spent in advance, and I think
    there is a lot of concern that we have not had adequate armor
    protection for vehicles, therefore unnecessarily exposing
    personnel to harm. That's why we have the lines of authority,
    and that's why it's a line-item budget. How can you assure us
    that we're going to be comfortable, that the money will be
    spent on what we consider to be priorities, not simply what DOD
    considers as its priorities?
        Secretary Wolfowitz. Again, I'm going to turn to the
    experts in a minute, but we are not looking for a blank check,
    at least I don't think that's what we're looking for. What we
    are looking for is the flexibility to move money when you need
    to move it. In fact you mentioned up-armored HMMWVs, and that's
    precisely one of the places where, as you probably know, the
    Army requirement has grown and grown.
        Senator Ben Nelson. Is that one of the areas identified as
    an illustration as opposed to a line-item account, Director
    Kaplan?
        Mr. Kaplan. As has been pointed out, the accounts are
    broad, O&M for the various----
        Senator Ben Nelson. For illustrations, not accounts. But
    when we're dealing with illustrations, not accounts, anything
    goes that's not on there, or what's on there may not be funded,
    if you're following where I'm going. So it's the flexibility
    that almost begins to look like any of the above or whatever we
    decide in the future.
        Mr. Kaplan. There's no question that we're looking for
    flexibility, and it's for the reasons Secretary Wolfowitz
    pointed out. It's to make sure that the DOD is able to respond
    quickly to an emerging threat environment, and as the needs
    change, to make sure, that the troops in the field--and I
    expect Congress--have the comfort and the confidence that those
    resources will be there.
        Senator Ben Nelson. Is there a way to limit the number of
    accounts so that we don't have something going outside of one
    of these accounts that is nothing more than an illustration? I
    think that might give us more comfort about our oversight.
        Secretary Wolfowitz. I think that might be possible,
    Senator. Mr. Lanzillotta?
        Mr. Lanzillotta. Senator, to continue using your example of
    the up-armor HMMWVs and why we need the flexibility, we have
    funded the requirement for up-armored HMMWVs three times. When
    we put the supplemental in, we put in what we thought was the
    full requirement for up-armored HMMWVs. The requirement grew
    because of reality on the ground. We fully funded again but the
    reality changed again and so we fully funded it again. We don't
    have a specific----
        Senator Ben Nelson. I'm not challenging you on that point.
    I think you're doing what you need to do. My point is, couldn't
    we fence in all the things for which it could be spent,
    recognizing that between accounts or among accounts you might
    have some flexibility to be able to do exactly what you're
    doing, or, as circumstances change, you're able to redirect
    some money in that way. But at least we would know what the
    parameters are, not just by the total amount of money, but also
    by where it might be spent.
        Mr. Lanzillotta. Our attempt when we structured it for
    basically O&M was to assure Congress that we were using it for
    operational support costs associated with Afghanistan and Iraq.
        Senator Ben Nelson. Or anything else that might come up. I
    mean, that's a problem.
        Mr. Lanzillotta. That's the flexibility. But the 5-day
    reporting period where we come down there and tell you if
    something changes was to give Congress notice. I'll give you an
    excellent example. There are certain R&D efforts that have
    helped us immensely with the booby traps and the explosive
    devices that we've encountered. We wanted to be able to have
    the flexibility if we find something to be able to transfer an
    amount of money to R&D to be able to rush that to the
    battlefield.
        Now, that has happened already with the same flexibility
    that Congress was able to give us in the IFF account. We're
    able to find something new, rush it up there, and do it. Our
    problem is without the flexibility, and the reason why the
    account was structured this way, is because right now as we sit
    a year out, I don't know what that technology may be.
        Senator Ben Nelson. But you're going to come back to us
    between now and 12 months.
        Secretary Wolfowitz. Senator Nelson, I think there's some
    room here to work on something that gives the troops the
    flexibility they need, gives Congress the oversight it needs,
    and frankly, a little discipline on the process so that people
    can't go and use this fund for whatever suits their fancy. That
    would be quite all right with me.
        Senator Ben Nelson. I thank the chair and I thank the
    Secretary for picking up the point that I think we're making. I
    may not have made it very well, but I think you have the idea.
    Thank you, Mr. Chairman.
        Chairman Warner. The committee thanks you, Senator, because
    while in our opening round of questions we expressed these
    concerns, we now hear you proffering some type of document to
    this committee which could be incorporated should we move
    forward on the floor, and that would lend itself to give the
    specificity and the restrictions on the flexibility that we
    feel appropriate. Is that correct? Did I hear you say that?
        Senator Ben Nelson. I didn't quite get to the point of a
    document, Mr. Chairman, but let me----
        Chairman Warner. I think I like things in writing.
        Senator Ben Nelson. I understand the need. I need some
    expert advice though.
        Chairman Warner. Will you please communicate with the chair
    and the ranking member and we'll see that the committee is so
    advised. I believe you detect the concern among the committee,
    and this is a case of first impression. If we go forward with
    it, we want to make sure we do it right, and we will work in
    consultation with the Appropriations Committee, which in many
    respects have the principal authority for this type of package.
        Thank you. Senator Collins.
        Senator Collins. Mr. Chairman, I'm going to follow up and
    try to get that commitment for that document. Mr. Secretary, we
    need to strike the right balance here between the
    administration's understandable need for flexibility and the
    congressional need to closely oversee spending. I recognize
    that the administration will be submitting a traditional
    supplemental request next year, but I want to echo the concerns
    of many of my colleagues, Senator Lieberman, Senator Allard,
    Senator Nelson, and others, in encouraging you to consider
    either resubmitting this $25 billion request in the form of a
    traditional supplemental appropriation, or along the lines
    suggested by my colleague from Colorado.
        We really do need to preserve the important role that
    Congress plays. It is our duty. This is not a case where we're
    not eager to give you the money you need. We are eager to
    ensure that our troops have all the resources that they need.
    You don't need this dispute, and I would encourage you to work
    with the committee to come up with some controls on the
    spending. We're very eager to move quickly to give you the
    funding that you need, but I hope you will consider working
    with the committee to come up with a more traditional request
    with checks and balances in it so that we can move forward
    without having this needless dispute.
        Secretary Wolfowitz. I appreciate the spirit of that
    comment, Senator Collins, and we will work with you.
        Senator Collins. Thank you.
        Chairman Warner. Senator Collins, without interrupting you,
    I think it would be nice to get Director Kaplan on the record.
        Senator Collins. Thank you for that admonition.
        Chairman Warner. Direct your question to Director Kaplan.
        Senator Collins. Director Kaplan, since you're representing
    OMB, which tends to play a very important, deciding role in
    these issues, I would like to get from you also a commitment to
    work with the committee to resolve the concerns that you've
    heard expressed on both sides of the aisle. Again, I want to
    emphasize this is not a dispute over giving you the resources
    that our troops need. All of us want to make sure that we do
    that quickly and fully.
        But we do need to exercise our constitutional
    responsibilities, so I would ask for the same commitment from
    you.
        Mr. Kaplan. Of course, Senator, and thank you, Mr.
    Chairman, for giving me the opportunity to get on the record as
    well. We share Secretary Wolfowitz's commitment to working with
    members of this committee and other committees and members with
    interest to try to strike that balance between making sure
    Congress can exercise its constitutional oversight prerogatives
    while still providing the flexibility that the commanders and
    the Services need.
        Chairman Warner. Fine. Bear in mind we're on the floor
    Monday, so you have your weekend work cut out. Thank you. You
    can take another minute.
        Senator Collins. Thank you. General Pace, I continue to
    receive e-mails from soldiers in Iraq who tell me that they
    still lack the equipment they need, and that is just so
    troubling to me. Just a few days ago, a member of my staff
    received an e-mail from a friend serving in Iraq, who doesn't
    happen to be from Maine, but let me tell you what he said. He
    said, despite numerous requests, he still had no long-range
    communications, only light-armored vehicles, and the only
    ammunition he had for one of his weapons came from the
    generosity of a local Danish military unit. That really
    troubles me.
        Do you believe that this additional $25 billion will be
    sufficient to ensure that our troops have what they need? We're
    sending them into such a dangerous environment, and I feel we
    have a moral obligation to make sure that they have all of the
    supplies and equipment, and most of all, protection that they
    need. Are you confident that the $25 billion that the
    administration has requested will solve those concerns once and
    for all?
        General Pace. Senator, thank you. That e-mail and the way
    you just described it troubles me as well, and whatever way you
    think appropriate, if you could share as much information from
    that as you can with me, I would like to get directly to
    answering that specific problem.
        Second, I am confident that this Congress has already
    allocated sufficient resources for that problem to not exist
    today. So if it does exist, it is not because you have not
    given us the wherewithal, it exists for some other reason. You
    have funded very quickly, for example, when we identified to
    you the need for up-armored vehicles, for more armor on them,
    when we identified the need for the new state-of-the-art
    personal body protection. All those requests that we have
    brought forward to this Congress, were funded very quickly. I
    am confident that you have already given us the assets we need
    to answer that question, but I cannot answer that question
    without having more specifics.
        Senator Collins. I'll see what we can share with you.
    Obviously I don't want to get the soldier in trouble in any way
    who brought this to our attention, because it's not just one
    soldier. I keep hearing similar reports, and we do need to
    remedy it.
        In my remaining time, could you please explain more
    precisely, General Pace, to the committee how you arrived at
    the $25 billion figure?
        General Pace. Ma'am, I did not personally arrive at that
    number, but I can tell you that it is specifically based on the
    numbers that Mr. Lanzillotta indicated, which is a utilization
    today of about $5 billion per month combined between Iraq and
    Afghanistan. It is based on our understanding that if things
    did not change, if come 1 October of this year we are operating
    exactly the way we are today, and that's not a known, but if it
    is, then that would take us through the first 5 months of the
    coming fiscal year in a way that would allow us to not have to
    reach deep into 2005 to come forward with training and fuel and
    things that we would buy in the fourth quarter to pay for the
    current expenditures at that time.
        Senator Collins. Mr. Secretary or the comptroller, if
    either of you could add to that.
        Secretary Wolfowitz. Senator Collins, it was intended to
    give us a very comfortable margin of error, which doesn't mean
    that we wouldn't be paying for some first quarter expenses with
    fourth quarter money. That we think we can do, but we don't
    want to end up in a situation where we're paying for second
    quarter expenses with third quarter money and people start to
    see their accounts running dry, especially Army O&M, which I
    mentioned earlier.
        Sometimes businessmen come and say, you have a $400 billion
    budget. Certainly that gives you a lot of latitude to move
    money around. But the account that is most critical here is the
    Army's $26 billion O&M account, and it's the Army as we all
    know that is incurring the greatest share of that supplemental
    funding. So we need to make sure that those accounts don't
    start to run dry and the managers of those accounts start to
    say, I have to cut back on something that's pretty important
    because I need to fund something that's absolutely essential.
    We want to make sure, and particularly when it comes to
    maintaining the momentum of key Army programs like the brigade
    restructuring.
        If I might just make a comment reinforcing what General
    Pace just said, if there are issues, we want to find them and
    fix them as fast as we can in the area of force protection. In
    fact, Ron Sega, who's the director of defense research and
    engineering, has a task force that reports to me on force
    protection measures across the board. The Joint Staff also has
    an Army-directed or Army-led force protection effort that
    focuses particularly on equipment issues. We've already
    accomplished nearly $2 billion. In fact, $1,931,000,000, to be
    precise, out of fiscal year 2004 funding, particularly for up-
    armored HMMWVs, interceptor body army, and there's another $720
    million in process. In other words, it's over $2.6 billion,
    which is another reason why we do need some considerable degree
    of flexibility. Many of those expenditures were different from
    what we anticipated a year ago.
        Chairman Warner. Thank you very much, Senator Collins. I
    think, Senator Collins, we have made an incremental landing
    here. [Laughter.]
        We're all waiting until your turn comes, Senator Byrd.
        Senator Dayton.
        Senator Dayton. Mr. Chairman, I would be honored to defer
    to Senator Byrd.
        Chairman Warner. I've made that proffer, but there's been a
    bit of a stiff resistance. He wants to maintain his order out
    of respect for his colleagues. Now, once more, Senator Byrd, do
    you wish to go forward? Your colleagues have invited you to do
    so.
        Senator Dayton. I'll defer to you, sir.
        Senator Byrd. Thank you, and thank you my colleagues. These
    are the invincible 23 who stood against the resolution of shame
    of October 16, 2002. Now, Mr. Secretary, and Mr. Chairman,
    thank you. Mr. Secretary, turning to the $25 billion request,
    which reads that the President would be able to transfer any
    amount from the fund at his discretion at any time effective
    October 1, which would exempt the spending from any limits on
    discretionary spending.
        This would further transfer authority to the Secretary of
    Defense in consultation with the Director of OMB, and would
    give the administration a blank check, limited only by the
    requirement that funds be used to support operations in Iraq
    and Afghanistan. There is no requirement for consultation with
    Congress. Shame. There is a modest reporting requirement that
    Congress included in the fiscal year 2003 and fiscal year 2004
    supplemental for the IFF. That is not part of the President's
    request.
        Mr. Secretary, I want to compliment the lady from Maine.
    She is entitled to the plaudits of the entire committee for the
    wisdom that she has demonstrated here today. She has brought
    some common sense to the committee and I compliment the
    panelists for their joining and indicating their support for
    her proposal.
        The proposal is deficient in a number of ways. Further,
    there should be a requirement to consult with the chairman and
    the ranking member of the Armed Services and the Appropriations
    Committees prior to transferring funds. There should be a
    requirement to report to Congress on the expenditure of funds.
    There should be detailed justification for the request.
        In support of the $25 billion request, there is a four-page
    request. We don't know how much is for pay, how much is for
    procurement, how much is for classified projects, or for
    military construction projects. The proposal provides for a
    blanket $25 billion transfer authority with no requirements for
    detailed justification, no consultation, and no reporting.
        Mr. Chairman, there must be consultation with the chairman
    and ranking member of this committee, and consultation with the
    chairman and ranking member of the Appropriations Committees of
    both Houses. The language is ambiguous about whether the funds
    would be used for dual use purposes that could result in
    missions outside of Iraq and Afghanistan. We need absolute
    clarity and assurances that these funds will not and cannot be
    used to export war to get into another country.
        Mr. Chairman, our forefathers would have scorned such
    arrogance as has been demonstrated by this administration and
    this request. Let me call to your attention, it shouldn't have
    to be done but I think it should be done, here is the
    Constitution of the United States. I hold it in my hand.
    Section 9, let me call it to the attention of the messengers of
    this administration: No money shall be drawn from the Treasury
    but in consequence of appropriations made by law and a regular
    statement and account of the receipts and expenditures of all
    public monies shall be published from time to time.
    Appropriations made by law.
        Let me read where that comes from. That comes from Section
    1, Article 1, all legislative powers herein granted shall be
    vested in a Congress of the United States, which shall consist
    of a Senate and House of Representatives. God bless the
    Constitution of the United States. God bless the Constitution
    of the United States. I call this to the attention of my
    colleagues. Let us keep in mind this Constitution. Let us keep
    in mind this Constitution and let us adhere to it. Let us
    remember that we swore under oath to uphold this Constitution,
    and when we appropriate these monies, Mr. Secretary, we're
    going to keep in mind this Constitution and we're going to put
    limitations on this appropriation, and it's not going to be in
    this appropriation when we appropriate it.
        The President is not going to be able to take these monies
    from one account to another as he has requested through you.
    No, we're not going to allow him to do that. No, the people
    still reign in this country of ours, the people still reign,
    and this Constitution guarantees that. I'm going to support
    this $25 billion, but we're going to put limitations on it.
    We're supposed to do that, because we're sworn to protect the
    people's money. Remember that great Roman Senator who said,
    there is no fortress so strong that money cannot take it.
        Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator. Senator Dole.
        Senator Dole. Senator Warner, I want to thank you for your
    tireless efforts in support of our military and I certainly
    want to thank our witnesses. I applaud your efforts in
    protecting our country through your respective positions, and I
    appreciate your willingness today to facilitate a discussion of
    the importance of seeing this war through to its completion.
        Thousands of men and women from my home State of North
    Carolina have proudly gone to serve in Iraq. While some have
    come home, many more remain in theater fighting for the safety
    of our world and the freedom of millions, and sadly some will
    never come home. The 25-year-old lieutenant whose first child
    was just born, the 33-year-old sergeant who can no longer
    support his five children, the 19-year-old private who leaves
    behind an 18-year-old widow, and the four guards from
    Blackwater whose families will be forever haunted by the
    horrific images of their deaths.
        I am proud of our men and women who are risking their lives
    in the name of freedom, and in the last few months the
    operation in Iraq has proven to be, as we all know, much more
    dangerous and grinding than some had expected. Adequate
    resources are essential to providing security and allowing our
    troops to complete their assignments in Iraq, and these must be
    our first priority. We must stay focused on what is most
    important, providing whatever funding is necessary to move
    forward.
        General Pace, this committee, as is clear today, has been
    closely monitoring the supply of up-armored HMMWVs, protective
    vests, personnel communications systems, and other equipment
    vital to the safety of our individual servicemembers. Does this
    supplemental fund your strategic lift needs for the remainder
    of this calendar year?
        General Pace. Senator, to my knowledge, this supplemental
    that takes effect October 1 does not fund this fiscal year's
    strategic needs. I believe this fiscal year's strategic needs
    are already taken care of in the monies you've already
    allocated. But we do have sufficient funding in the current
    budget to do the transfer of troops that is ongoing as we
    speak.
        Senator Dole. Secretary Wolfowitz, DOD contractors and
    private business representatives are critical to the rebuilding
    effort, of course, in Iraq. Terrorists have shifted their focus
    and are targeting these unarmed civilians. Again, I just want
    to be assured that we do have funds that will increase security
    for these Americans.
        Secretary Wolfowitz. That's certainly one of the possible
    requirements in our operations that is critical. I would also
    emphasize I think it's a reason why, as I emphasized in my
    opening statement, that we put Iraqis forward as much as
    possible to do the rebuilding of their own country. It is their
    country. If someone's going to be targeted, they're the ones
    appropriately who should. But I also think that as Iraqis
    they're much less likely to be targeted. We're working very
    closely with our division commanders to make sure that they,
    the contractors and the very brave civilians that work for U.S.
    Agency for International Development (USAID) and other agencies
    are working together so that this effort can go forward safely.
        Senator Dole. Now, I understand that the Army has shifted
    resources to provide tighter protection along the lengths of
    food and supply convoys. Has that left other areas like oil
    fields, pipelines, and weapons caches, more vulnerable?
        General Pace. Ma'am, one of the reasons that General
    Abizaid asked to retain 19,000 more troops that he needed,
    which basically is an additional division plus their support,
    was to in fact cover the kinds of additional security
    requirements you're talking about. Part of the ongoing support
    for pipelines and the like is underneath the auspices of the
    Iraqi Minister of Interior and the troops that he has in his
    security forces. We work in combination with them.
        Senator Dole. Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much, Senator Dole. Now,
    Mr. Dayton, you've exercised great patience. Please proceed.
        Senator Dayton. Thank you, Mr. Chairman. Thank you for your
    wise guidance of our committee today, and thank you, Senator
    Byrd, for all the incredible education I've received from you
    about the Constitution and its true meaning to our country.
    Your service on behalf of that Constitution has been
    extraordinary, sir, both of yours, I thank you both.
        Last spring, we approved a $75.5 billion supplemental and
    then last fall a $87.5 billion supplemental for a total of $163
    billion. Next year, fiscal year, starting in 5 months, we have,
    as others have pointed out, not received a formal request, and
    I gather that this today does not constitute such. Rather, it's
    what is called a contingent emergency reserve fund.
        I'm going to support it, but I'm very concerned about doing
    so before receiving any accounting as to how the $163 billion
    that has been appropriated in the previous two supplementals
    has been spent or is being spent now. I'd like to ask that this
    committee receive that, not dollar for dollar but in the basic
    categories, and I would ask for that by close of business
    Friday, because I'd like to have it before we take it up next
    week.
        As I recall, the last supplemental provided $15 billion for
    reconstruction costs of Iraq. I've read some reports that that
    money has not been expended. I saw in the last monthly report
    in terms of the status in Iraq that to date, I believe it was
    through April, Iraq's oil revenues are $5.4 billion. I'd be
    interested to know if that is meeting, falling short, or
    exceeding your expectations, and at what point will those funds
    become available for use in Iraq's own reconstruction.
        As I recall, the last supplemental provided $5 billion for
    security force training. I'd like to know if that's been fully
    expended. I believe there was a certain amount, I don't recall
    the amount, provided to extend, or provide unemployment
    benefits to some 1.8 million Iraqis, which is more than we've
    been able to get out of the Senate this week for American
    workers. So I'd like to know to what extent financial aid to
    Iraqis not currently employed is still being expended.
        Also, Mr. Kaplan, if you could update the figure that you
    provided us today. If I heard you correctly, the monthly
    expenditure approximating $4 billion, I believe is a figure
    that preceded the retention of the additional 20,000 troops and
    some of the other intensified activities. I would appreciate
    receiving a current fix on what is being expended on a monthly
    basis, say last month, this month, and expected for next month
    either now or in writing.
        My first concern regarding this request is without having
    received, I believe, any kind of accounting. Maybe the
    Appropriations Committee has, but certainly this committee,
    this Senator has not seen accounting for $163 billion that has
    been provided literally in the last 12 months.
        Then I'm also concerned about approving something when we
    don't know what plan it is that we're forward funding. I heard
    a quote this morning attributed by Fox News--to Secretary
    Rumsfeld, ``there is a very real possibility that we may not
    succeed in Iraq and we've got to realize that now. These
    pictures could have done immeasurable harm. The alleged acts of
    these soldiers could have made the difference.''
        I don't know what the context was for that statement, I
    don't know if that reflects any shift in the administration's
    thinking or planning for what our purposes in continuing to
    keep the force level that's been described in Iraq. But I would
    like, Mr. Chairman, to ask if, not in this hearing--and again I
    expect this supplemental will be approved, so it wouldn't be in
    time for that decision next week in the full Senate--that this
    committee devote a hearing either in open or closed session to
    what is the plan for the operation in Iraq, what are the
    objectives, military and diplomatic, and what is the time table
    for realizing those goals so that we know what it is we're
    buying into here.
        Chairman Warner. I assure you that the ranking member,
    Senator Levin, and I are reviewing options to do just that
    shortly after we get back from the recess period. Could you
    further define the origin of that quote?
        Senator Dayton. It was approximately 8:30 a.m. on Fox News.
        Chairman Warner. Was this attributed to him or was he on
    Fox News himself?
        Senator Dayton. There was footage of him. It was attributed
    to him. The commentator or the anchor person was E.D. Hill, and
    the quote was attributed to Secretary Rumsfeld. I wrote it down
    carefully, in fact, because I was on the program, I had my
    staff video it so I get a chance to get it over again.
        Chairman Warner. So you have it on tape then?
        Senator Dayton. I have it on tape. What she said, what she
    attributed to him.
        Chairman Warner. That transcript should be available and
    we'll ask staff to immediately get that transcript. I thank the
    Senator.
        Senator Dayton. I'd be open to any comments.
        Secretary Wolfowitz. On that last point, I don't know what
    was said or the context. I do know that in the hearing before
    the Appropriations Committee yesterday, the Secretary was asked
    in a question by an individual who felt that the situation was
    a--I don't remember the exact context--but what the Secretary's
    response was, ``I understand an individual feels that way, I
    can understand that, we all go through strong emotions when
    something like this Abu Ghraib thing occurs. We see it and
    we're shocked and we're stunned and we're disgusted and we know
    in our hearts we're better than that. I know it doesn't
    represent our country, that isn't American.''
        Then he went on to say that ``the conclusion that that
    young person came to that we're at the beginning of the end, I
    submit, will prove to be wrong, and the good Lord willing I'll
    be right, and his understandable concern and comment and
    emotional reaction I hope and pray will be wrong.''
        I don't know the context of the other quote, but I
    certainly think, and the Secretary believes, in spite of some
    difficulties in the last few months and a real body blow from
    this prisoner abuse, that we are succeeding and this is
    something that we can win and is very important to win, and
    that's why I addressed those issues in my opening statement.
        We will give you the full accounting that you've asked for.
    I would note on the reconstruction numbers, they keep growing,
    so they tend to change on a daily basis. The numbers that I
    have as of a few days ago are that nearly $11 billion of the
    $18.4 billion has been apportioned. I notified Congress as to
    the provisions, and I think it's section 2207. Of that, $6.6
    billion has been committed against specific projects and $3.1
    billion has been obligated.
        That's by no means the total of reconstruction work that's
    going on in Iraq, and if you will permit me, the fact is that
    this was done more or less overnight by CPA and they'd like
    more time to be sure the numbers are accurate. Let me just say
    in round numbers, over $5 billion of Iraqi funds have been
    budgeted from July of last year to the end of this year for
    reconstruction, and of that, nearly $3 billion of Iraqi funds
    have been obligated or expended.
        So there is a lot going on. We don't want that $18 billion
    to go out the door overnight. It wouldn't be prudent and it
    would diminish our ability to manage with that over the coming
    couple of years. So I think it's moving at a reasonable pace.
        Senator Dayton. I just want to conclude by saying I think
    we have succeeded in very important respects. Our military won
    a tremendous victory in 3 weeks last year from the border to
    taking over Baghdad and toppling the Saddam Hussein regime,
    which was one stated goal. We determined that there are no
    weapons of mass destruction (WMD) there that threatened our
    national security. This June 30, we are turning over the reins
    of government in the initial phase to a successor Iraqi
    Government, so I think we should recognize and be very proud of
    our military and proud of what has been accomplished.
        I just want to know what it is that our objectives are and
    I'm glad the Secretary is, if he is reassessing, or assessing
    anyway, based on current realities, what the time table is
    going to be. We're talking about 134,000 troops into the year
    2006, what their role is going to be, and what the role of a
    couple hundred thousand Iraqis that have been equipped to train
    now. They should be taking over responsibility.
        I don't have time to get into what's happening in Fallujah,
    but I know that General Conway has ceded some authority there.
    The volatile situation is not in the news. Well, it sure is
    volatile, but at least it's not exploding currently. I don't
    know what the assessment is of that success, but that seems to
    me to augur what ought to be the goal to get the Iraqis
    responsible for walking the streets and policing their own
    communities and enforcing law and order rather than our troops.
        I hope we can have time to devote to that in the near
    future. Thank you, Mr. Chairman.
        Chairman Warner. Thank you very much. If my colleagues
    would indulge me a minute, I've just been handed a press
    report, New York Daily News, today. It's titled, ``Rumsfeld Has
    Doubts.'' But as I read through it, his quotes, which I'll
    read, are very cryptic, and I think he's addressing the
    turnover of authority on June 30.
        Rumsfeld said the prison abuse scandal had delivered, ``a
    body blow to the nation building effort in Iraq that has cost
    the lives of more than 770 U.S. troops. Will it happen right on
    time? I think so. I hope so. Will it be perfect? No. Is it
    possible it won't work? Yes.'' In the overall war on terror,
    Rumsfeld said the U.S. is making progress in Afghanistan, but,
    ``I look at Iraq and all I can say is, I hope it comes out well
    and I believe it will and we're going to keep at it.''
        I think it expresses his resolve, but a pragmatic
    observation of the events that we've see in the last 30 or so
    days. Thank you very much.
        Senator Dayton. Thank you very much, Mr. Chairman.
        Chairman Warner. Senator Sessions.
        Senator Sessions. Thank you, Mr. Chairman, and I would just
    add that I hope those remarks and decapitation of the American
    recently there will cause Iraqi leaders to realize they have to
    step up, that it's time for them to lead in Iraq.
        Mr. Chairman, or Mr. Secretary, as I understand this
    situation, we have a number of accounts with money in it, some
    with some extra money in it, some with some monies, and some
    accounts that may be running low. I don't think we can afford
    this item because that account is running low and we have a
    soldier lost because we didn't have the money necessary to give
    to him, because they have certain responsibilities not to let
    the account run over. I don't want them to get panicky and say,
    make those kind of decisions. Is that part of your concern?
        Secretary Wolfowitz. It's exactly our concern, Senator
    Sessions, and I would add we also don't want them to say, well,
    we have money, but it's in the wrong account and it's going to
    take a month to reallocate it. We don't want them to say, well,
    we have a lot of money for tank ammunition, but we don't have
    any money to give you body armor, and radios for the Iraqi
    police whom you're trying to equip. That was a problem last
    fall and, as I said in my opening statement, I appreciate the
    flexibility this committee is trying to get us in the next
    fiscal year. But flexibility is very important, not just the
    total amounts that you have, but the ability to meet an
    emergency need when it arises.
        So exactly in the spirit of Senator Collins' comment
    earlier, we want to work with Congress to make sure Congress
    has the right degree of oversight and the troops have the right
    degree of flexibility.
        Senator Sessions. I felt strongly that this was really an
    unacceptable event when we had this bureaucratic problem with
    getting money to the security forces in Iraq who are critical,
    I believe, to the stability and success there. Has that been
    solved to date? Also, will this money allow commanders and
    General Petraeus, who is going there to deal with this specific
    problem, to bring that force up to the highest level?
        Secretary Wolfowitz. In terms of total quantity of money,
    yes. In terms of flexibility, largely, since the supplemental
    money is now flowing. There is one issue which I think is more
    in the area of the Appropriations Committees with respect to
    the authorities for which certain funds can be used, and we
    want to make sure that we have the right understanding on the
    flexibility there.
        Senator Sessions. I'll ask General Pace, are you confident
    that we can get the funds necessary to bring the Iraqi security
    forces up to their highest possible level under the current
    circumstances with this supplemental or this account that
    you're requesting? Will this help in that area also?
        General Pace. Sir, it will help in that area, and it has
    been pointed out, there has been in the past understandable
    problems with allocation of dollars on the battlefield for
    hiring Iraqi military, Iraqi police, and local civilians to do
    work by the commanders on the battlefield. We should be
    accountable for every single dollar you've given us and every
    dollar you may give us. That goes absolutely unquestioned.
        Secretary Wolfowitz. Senator Sessions, I do want to add, we
    did request $500 million in authority, nonfunding authority, to
    use accounts for training and equipping Iraqi security forces
    and I believe this committee reduced that to $150 million, and
    I would encourage any effort that could be made to raise that
    ceiling.
        Senator Sessions. I have been concerned about that, since I
    went there in August of last year. I visited with the local
    security forces and they will tell the tale. Their success, and
    lack of it, will make the key difference here.
        Just with regard to the philosophy of where we are, I have
    felt that a supplemental is all right for this effort. In fact,
    I think it allows us to separate the costs of the war from the
    cost of operating the DOD. I've not agreed with Senator Levin,
    although he brilliantly raised the question earlier today, on
    the fundamental idea that it's appropriate to fund an
    extraordinary military effort by a separate account. I think it
    leaves Congress in a better position to watch it.
        Now, I tend to agree with the others, however, that this
    lacks a transparency that we'd like to have and we feel like we
    need to have, so I'm glad that you are willing to look at it
    and help us get some more transparency and oversight.
        General Pace, we've increased the DOD funding, but not
    greatly. As Senator Inhofe said, as a percentage of the GDP of
    this country, we're less than we were probably in the 1990s,
    certainly in the 1980s, or early 1990s, late 1980s. I'd like to
    know that the supplementals that are going to Iraq and
    Afghanistan are not being used to fulfill some DOD wish list on
    the theory that whatever you need for this war you're going to
    get, so as much as you can stack in there to fill other needs
    would be a temptation, I would think. Are you watching that?
        General Pace. Sir, we are watching that, and we should
    watch that and we should be accountable to you for that. You
    have my commitment to ensure that the money you allocate for us
    to use in Afghanistan and in Iraq is used properly in both
    those countries.
        Senator Sessions. We voted by better than three-fourths in
    this Congress and the American people have supported sending
    our soldiers there. We have an absolute obligation to support
    them completely. We committed them. They are performing
    exceedingly well under very dangerous conditions. Many of them
    this very moment are in dangerous conditions, perhaps executing
    the policies of this Congress, so we need to support them.
        I thank you for your answer and thank you, Mr. Chairman.
        Chairman Warner. Senator, thank you very much. Senator
    Akaka has not come yet, has he? All right.
        Senator Bill Nelson.
        Senator Bill Nelson. Thank you, Mr. Chairman. Senator Byrd,
    thank you for reminding us of the Constitution. It's not
    honoring the Constitution when we relinquish our constitutional
    authority without requiring the specificity. I want to give a
    couple of examples. We've now gotten into a routine where we
    pass an appropriations bill and then shortly thereafter we pass
    a supplemental appropriations bill. It happened just last year.
    We passed the appropriations bill in October, or in September,
    and low and behold, 1 month later, we pass a supplemental
    appropriations bill. Now, that's not a way to run a railroad.
        We have the administration's request coming to us earlier
    this year in the Budget Committee, and they do not request in
    their budget request any of the money for the operations in
    Afghanistan and Iraq. That's not a way to run a railroad.
    That's not a way for us to exercise our constitutional
    authority as the appropriators.
        I think you all have gotten the message here today that we
    need some specificity. For example, last year in the
    supplemental, I put in a $10 million little item which was for
    family readiness in the National Guard. That was in October of
    last year that it was passed and it has yet to obligated by the
    DOD. That was to help the family members since the National
    Guard members were being extended on duty.
        Since the DOD is relying so heavily on the Guard and
    Reserves these days, it's going to be necessary to refit the
    National Guard and the Reserves when they are then going to be
    returned to Iraq. So a logical question for me that you all
    can't answer today is, how much is in this $25 billion request
    to reset the Guard and the Reserves so that we know that they
    are prepared? It's not here, you don't have that information.
    Ultimately what's going to have to be done is we're not going
    to have 105,000 or 130,000, but I think we're going to have to
    go to 150,000 troops.
        I think sooner or later that the world community is going
    to be convened and some kind of consensus is going to come and
    the North Atlantic Treaty Organization (NATO) is going to be
    asked to come in, led by the U.S. To stabilize Iraq for the
    long term is going to take some 150,000 troops, so we're going
    to have more expenditures, which I'm willing to support, but I
    need to know the specificity so that I know what I'm doing, and
    as Senator Byrd has so eloquently pointed out, that I am
    fulfilling the oath that I took to uphold the Constitution. I
    think this is kind of the message that you all are clearly
    getting today.
        On the prisoner abuse issue, I would just say this in
    passing, that one of the photographs that struck me the most
    was the one that had already been printed in the newspaper,
    which was of the cell block where the bodies were clumped
    together naked and, in this particular photograph, it looked
    like that they were shackled together.
        What was instructive about the photograph that we saw in
    the newspaper was that it seemed that the troops there were
    just going on about their normal business. In the photograph
    that we saw that was not tightly cropped like it was in the
    newspaper, we could see other troops there. Senator Clinton and
    I counted seven or eight troops, as if this was business as
    usual. Now, you can't tell me that seven or eight Army privates
    are going to be responsible for this and that it is our
    responsibility, indeed, it's your responsibility, to go up that
    chain of command and to find out how these troops were ordered
    to do what they were doing.
        I personally think that it's not going to lead to General
    Miller. I think he went over and made a recommendation on what
    he saw happen in Guantanamo. I think clearly it's not going to
    lead to General Sanchez, because in the report that I've seen
    and the time line, he clearly started the inquiry immediately
    after he was notified. But we need to know where this goes, Mr.
    Secretary. Thank you, Mr. Chairman.
        Chairman Warner. Thank you, Senator. Thank you very much
    for your observations on this question. We will now turn to
    Senator Reed.
        Senator Reed. Thank you, Mr. Chairman, and I understand
    that your original guidance has been withdrawn.
        Chairman Warner. The Senator is correct, for reasons which
    I stated clearly.
        Senator Reed. So I will pose the following question.
    General Pace, if you were shown a video of a United States
    marine or an American citizen in the control of a foreign power
    in a cell block naked with a bag over their head, squatting
    with their arms uplifted for 45 minutes, would you describe
    this as a good interrogation technique or a violation of the
    Geneva Conventions?
        General Pace. I would describe it as a violation, sir.
        Senator Reed. Would your conclusion be different if it was
    ordered by a high-ranking officer of that foreign power?
        General Pace. No, sir.
        Senator Reed. As I read General Sanchez's guidance,
    precisely that behavior could have been employed in Iraq. Let
    me ask, since you said in respect to this supplemental
    appropriation, your responsibility, and I respect it, is to
    absorb all the details and all the data from the theater of
    operations and make recommendations and decisions.
        Did the Joint Staff review General Sanchez's
    recommendations and his interrogation rules?
        General Pace. Sir, I'm not aware--what recommendations?
        Senator Reed. The rules that we were shown by General
    Alexander and others, which would allow, with his permission,
    keeping someone in a squatting position and presumably naked
    with their arms up for 45 minutes. Did you review any of those
    rules or standard operating procedures which General Sanchez
    approved?
        General Pace. Sir, I did not personally see them and I do
    not know to what level they were visible or reviewed.
        Chairman Warner. Senator, that's an important question. I
    think the witness should be given a full opportunity to answer
    that promptly for the record. I think we should also provide
    him with the document that was utilized by this committee and
    the Intelligence Committee yesterday to which you refer.
        General Pace. Yes, Mr. Chairman, I concur.
        Senator Reed. Were there any discussions of these
    interrogation techniques by the Joint Staff since General
    Sanchez is commanding a joint operation?
        General Pace. Senator, the only discussions of which I am
    aware with regard to interrogation techniques and procedures
    had to do with our operations in Guantanamo. I am not
    personally aware of any discussions beyond the theater of the
    interrogation techniques in Iraq.
        Senator Reed. Mr. Secretary, are you aware of any
    discussions about these interrogation techniques and General
    Sanchez's order?
        Secretary Wolfowitz. I'm not aware, no. I am aware of
    discussions about Guantanamo, and I can tell you that what I'm
    aware of, those certainly would not have been remotely
    permitted in Guantanamo.
        Senator Reed. I've just heard General Pace say that the
    behavior that General Sanchez authorized, subject to his order,
    is a violation of the Geneva Convention. That was unvetted by
    the senior members, civilian members of the DOD, no discussion,
    no suggestion to General Sanchez that he could pursue this
    either in writing or verbally?
        Secretary Wolfowitz. Senator Reed, as I said earlier,
    there's an enormous amount of detail involved in this
    investigation. You're talking about things that General Pace
    and I have not seen and don't think are in a position to fairly
    comment upon. We will answer you for the record. You've heard
    hours of testimony and, including closed testimony, from people
    who are digging into this subject in great detail and great
    depth at the Secretary's instruction. His instruction to the
    two of us is to make sure that while that work is going on,
    that the other business of the DOD is being attended to.
        Mr. Chairman, I'll be happy to understand for the record
    what this question refers to and give you a clear and honest
    answer, and I know General Pace will also.
        Senator Reed. Mr. Secretary, we've heard hours of
    responses, but until General Pace's response, I haven't heard
    anything as candid and as forthright, frankly. What I've heard
    from you is dissembling and avoidance of answers, and lack of
    knowledge, pleading legal process.
        Secretary Wolfowitz. I'm not dissembling, Senator Reed. I
    have General Pace's same reaction. What you've described to me
    sounds to me like a violation of the Geneva Convention. It's
    the first time I've heard that it was in General Sanchez's
    direction and I believe it's the first time General Pace has
    heard that it was General Sanchez's direction.
        Senator Reed. I would suggest, Mr. Secretary, that you're
    not doing your job then. These were the orders issued to a
    joint intelligence operation in that prison presented to us in
    a hearing yesterday by a representative of the DOD as the
    standard procedures that could be followed.
        Chairman Warner. Senator, let me interrupt here just for a
    moment. In preparing for this hearing, I talked at length with
    the Deputy, expressing the absolute essential need that he and
    the Vice Chairman come up today. He told me very candidly that
    for the past week or so he has had to focus on the daily
    operations of the DOD, and such questions that might be put to
    him regarding the prisoner situation in Iraq, he said, Senator
    Warner, I simply haven't had the opportunity to keep the pace
    of all the work that the Secretary of Defense and the chairman
    are doing on this question.
        So I'd like to say in fairness to our two witnesses today,
    to me they were very forthcoming about their working on these
    budget issues at the same time the Secretary is working on the
    other issues. They may not be able to fully respond to
    questions today, and I think he's honestly said that.
        Senator Reed. Mr. Chairman, I respect immensely your
    leadership of this committee.
        Chairman Warner. Let's just let the Senator finish. Thank
    you.
        Senator Levin. I wonder if Senator Reed will yield on this
    issue just for 1 minute.
        Senator Reed. I will yield.
        Senator Levin. If you haven't seen these rules, they were
    at a public hearing before this committee, and were presented
    by General Alexander. You ought to see them. Maybe could we
    have somebody take them out to them? If you folks don't know
    about what happened in open session on this issue, there's a
    problem. This goes to the heart of the issue.
        Here's what he said on the interrogation rules of
    engagement. We brought with us the rules--that's what's coming
    down to you right now--of engagement that were in effect at the
    Combined Joint Task Force 7 in Iraq prior to October 2003.
    These rules are in compliance with the Geneva Convention, he
    says, and I think as Senator Reed has just pointed out, if you
    look at those rules there--stress positions up to 45 minutes,
    that's what I assume Senator Reed is referring to, directly
    stem from the interrogation manual. These are the rules that
    interrogation soldiers are trained on, and what you were asked
    about were those rules right there. If that's a stress
    position, which I agree with Senator Reed about, I think he
    said 40 minutes is a violation of the Geneva Convention. It
    pretty clearly seems to me, the fact that a commanding general
    (CG) approves it, as you'll see in that right hand column where
    it says CG approval, does not eliminate the violation of the
    Geneva Convention.
        So those are the rules, but Secretary Wolfowitz, this was
    in public session in front of this committee here, and it just
    amazes me that you're not familiar with something that goes to
    the heart of the issue of the Iraq interrogation.
        I have to point out one more thing, and I'm taking too much
    of Senator Reed's time. Perhaps the chairman would allow this
    not to be counted against his time. But take a look at the
    title. Have you ever seen a title about rules of engagement
    relative to interrogation? Rules of engagement relative to
    interrogation. General, have you ever seen that description
    before?
        General Pace. Not those words, no, sir.
        Senator Levin. Rules of engagement have to do with the use
    of force. The title of that document seems to me to
    dramatically say it all. That was approved. Secretary
    Wolfowitz, you're saying you don't know or you've never seen
    that document before? That's a formal document.
        Chairman Warner. But it came out of Central Command.
        Senator Levin. I know. I'm just asking. I want to make sure
    and I'll go back, because it seems to me this dramatizes the
    failure of leadership here. It goes into a lot more than just
    the six enlisted personnel, as Senator Nelson said. Those are
    rules of engagement for confronting detainees, using the very
    term which is not supposed to be used against detainees?
        Secretary Wolfowitz, you're not familiar with that document
    at all?
        Secretary Wolfowitz. I saw this document for the first time
    this morning. It seems to me, but I don't know, and this is why
    I'm very reluctant to start commenting, that what Senator Reed
    described is something that goes quite beyond what is permitted
    here.
        Senator Levin. No, no, look at the two dots, those two
    dots, stress up to 45 minutes.
        Secretary Wolfowitz. No, Senator Reed described something
    that went quite a lot beyond just stress positions.
        Senator Levin. Okay, I'm sorry.
        Secretary Wolfowitz. Let me say, it says here, detainees
    will never be touched in a malicious or unwanted manner, and
    approaches must always be humane and lawful. I don't think that
    what Senator Reed described is either humane or lawful.
        Senator Reed. Mr. Secretary, do you think crouching naked
    for 45 minutes is humane?
        Secretary Wolfowitz. Not naked, absolutely not.
        Senator Reed. So if he's dressed up, that's fine, but this
    also has other environmental manipulation. Let me put it this
    way, 72 hours without regular sleep, sensory deprivation, which
    would be a bag over your head for 72 hours. Do you think that's
    humane? That's what this says, a bag over your head for 72
    hours. Is that humane?
        Secretary Wolfowitz. Let me come back to what you said the
    work of the Department----
        Senator Reed. No. Answer the question, Mr. Secretary. Is
    that humane?
        Secretary Wolfowitz. I don't know whether it means a bag
    over your head for 72 hours, Senator, I don't know.
        Senator Reed. Mr. Secretary, you're dissembling, and
    nonresponsive. Anybody would say putting a bag over someone's
    head for 72 hours, which is----
        Secretary Wolfowitz. I believe it's not humane, it strikes
    me as not humane, Senator.
        Senator Reed. Thank you very much, Mr. Secretary. Thank
    you, Mr. Chairman.
        Chairman Warner. Thank you very much, and again, as I
    pointed out, it was made clear to the chair that these
    witnesses for the past week or 10 days have been heavily
    engaged in the daily operations of the DOD. I can understand in
    a situation of this magnitude how the Secretary needs to
    allocate responsibilities among his principal subordinates.
        So we'll continue now and we have our wonderful and
    patient----
        Secretary Wolfowitz. Mr. Chairman, if I might point out,
    the reason we know so much about this is because since we first
    understood back in January there was a problem, DOD has
    undertaken extensive investigations. That's where this
    information comes from, and one of my problems is that I don't
    know what some of these words mean. If they mean what Senator
    Reed says, then I can tell you, I think it's not humane. I
    don't know what the words mean on the piece of paper.
        Chairman Warner. I think, Mr. Secretary, you and General
    Pace have done your very best to be responsive to the
    questions. I do not detect any evasiveness. To the extent of
    your knowledge, you've spoken out forthrightly.
        The Senator from New York.
        Senator Clinton. Thank you, Mr. Chairman. Before I get to
    my questions, I just want to clarify that this entire committee
    has been supportive of the DOD and particularly of our men and
    women in uniform and the questioning and even the contentious
    nature of our concerns should not in any way be taken as an
    indication of any lessening of that support.
        We are properly focused on the behavior that has been
    brought to our attention because it is an issue that must be
    investigated, not only because the actions of a few should not
    be permitted to besmirch the honorable service of all of our
    men and women in uniform, but also because we are a Nation that
    abides by the rule of law, and we are a Nation that understands
    not only the necessity of adherence to our Constitution, but
    that due process is one of the great inventions of Western
    civilization.
        These issues go to the real heart of the use of power. An
    occupying army by its very nature is in a powerful and dominant
    position. We deplore the barbaric conduct of those who murdered
    Mr. Berg. We deplore the extraordinary cruelty that they have
    evidenced with respect to our civilians and military personnel.
    But we are not them.
        It is not just in the nature of ensuring that our conduct
    is held to a higher standard, but that we safeguard the rule of
    law. I have to say, Mr. Secretary, you come before this
    committee with respect to this budget request, in my view,
    having seriously undermined your credibility over a number of
    years now. When it comes to making estimates or predictions
    about what will occur in Iraq and what will be the costs in
    lives and money that the people in the United States,
    particularly our young men and women in uniform will bear, you
    have made numerous predictions time and time again that have
    turned out to be untrue and were based on faulty assumptions.
        For example, in March 2003, you said, ``there's a lot of
    money to pay for this reconstruction. It doesn't have to be
    U.S. taxpayer money. We are dealing with a country that can
    really finance its own reconstruction and relatively soon.''
    Again, another quote, ``the Iraqi people understand what this
    crisis is about, like the people of France in the 1940s, they
    view us as their hope for liberator.''
        I want to commend General Pace for his candor today. It
    reminds me very clearly of another United States officer who
    served honorably, General Shinseki, who before this committee
    told us, based on his best judgment and experience, that it
    would take several hundred thousand American troops. In
    response to that prediction, you said, ``the notion that it
    would take several hundred thousand American troops just seems
    outlandish.''
        Now, Mr. Secretary, the challenge we face in dealing with
    this request is one that has increasingly caused concern on
    both sides of the aisle. The competence and credibility of the
    leadership team on the civilian side in the DOD has certainly
    been called into question for good reason. So when you come
    before us and ask for a $25 billion blank check, which indeed
    is what it is, that raises questions among my colleagues on
    this committee and throughout the Senate, but it for me goes
    beyond just the issue of this particular request.
        It reminds me very much of what happened according to Bob
    Woodward's book, Plan of Attack, when President Bush
    acknowledged that months before Congress voted an Iraqi war
    resolution in October 2002, he approved 30 projects in Kuwait
    that helped set the stage for war with no real knowledge or
    involvement of Congress. Now, I know in all the explanations
    we've heard about how it wasn't really this and it was
    contingent that. It did not come out of any account however
    that Congress appropriated for the purposes for which the money
    was unintended.
        Secretary Wolfowitz, several weeks ago Secretary Rumsfeld
    said in response to a question, if you had said to me a year
    ago, describe the situation you'll be in today one year later,
    I don't know many people who would have described it the way it
    is today. I would not have described it the way it happens to
    be today. I certainly would not have estimated that we would
    have had the number of individuals lost that we have lost in
    the last week.
        Mr. Secretary, there have been many veteran members of this
    committee and elsewhere in Congress who have repeatedly urged
    the administration to increase troop strength. There have been
    a number of our military leaders who have made the same
    argument. That has been resisted time and time again. I think
    it is appropriate that you have accepted the suggestion made by
    Senator Collins, and I hope you take it to heart. The United
    States Congress is a full and equal party in our government.
    That is the way it was set up, that is the way it has worked
    very well, and that is the way it should continue to work. No
    matter how strongly anyone in the administration feels about
    this mission, that cannot be an excuse for undermining the
    time-proven method of our doing business in this Congress.
        I, for one, will join my colleagues in supporting the money
    that is needed, but I will not do it without further
    specificity and without a greater understanding of where we are
    headed. I look forward to the further consultations that the
    chairman has suggested will be held. If we're going to be
    responsible for sending along with you these young men and
    women to Iraq, Afghanistan, and elsewhere, then we should
    accept the full responsibility for what that entails, and that
    means working with you as a co-equal branch of government.
    Thank you.
        Secretary Wolfowitz. Senator Clinton, I can't respond to
    everything you just said, but I would like, Mr. Chairman, to
    just comment on this issue about troop strengths. You leave the
    impression that this is a civilian decision and by quoting
    General Shinseki that the military has a different view. The
    reason I said what I said some time ago was because in fact
    General Shinseki's estimate was very different from the
    combatant commander, General Franks. In fact I had a discussion
    in a previous conflict in Afghanistan with General Franks
    pressing him on the question of whether or not more troops were
    needed and he was quite insistent that he not only didn't need
    them, he didn't want them.
        I believe in hindsight that General Franks was absolutely
    right, and that he was right to hold down our troop levels in
    Afghanistan. We've had many discussions back and forth between
    the civilian leadership, the military leadership back here and
    our combatant commanders in the field about troop levels, and
    about whether you can leave the Shia heartland to a coalition
    division or if you need American troops. There is not a
    military view and a civilian view, as you try to suggest. There
    has been a unified view and an attempt to realistically
    estimate what we need.
        It is a mistake, it is a serious mistake, to put in more
    troops than you need. As General Abizaid would say, it
    increases the hostility toward us as on occupying power, and of
    course it exposes us to more casualties. Equally it's a mistake
    to put in too few troops, and when we needed more troops
    because the situation in Najaf and Karbala in particular had
    grown into something that that multinational division couldn't
    handle, we kept the 1st Armor Division to deal with the job.
        We're trying to get the numbers right. We are working
    closely with military and civilian. It's what General Franks in
    a long and eloquent presentation to a combatant commanders
    conference called iterative planning. It's a constant back and
    forth. There is no ignoring of military advice, I can assure
    you of that.
        Chairman Warner. We note the vote is on. We're very late.
    We will return as quickly as possible. [Recess.]
        Senator Sessions [presiding]. All right. Senator Warner
    asked that I chair the remainder of the hearing or until he
    returns. I hope he does because he's such a great presider and
    it's a pleasure and an honor to work with him. Next is Senator
    Talent. I would note that we had indicated to the panel that
    you had some things that had to be done and 12:30 was when we
    were trying to finish up. We're past that. Thank you for
    staying past that time and I recognize Senator Talent.
        Senator Talent. There could hardly be anybody else next,
    Mr. Chairman, nobody else being here.
        Senator Sessions. There may be. You never know.
        Senator Talent. I appreciate your sticking around, and I
    came back because I had a few things I wanted to say that
    actually differ somewhat from some of the sentiments my
    colleagues have expressed. First of all, a lot of people have
    said this appropriately, we're grateful for your being here and
    answering these tough questions. I'm grateful for your service
    on behalf of a very noble cause, and one that I share and
    believe in very much.
        Let me phrase it this way to you. If I had been drawing up
    this supplemental and I'd been in your shoes, I'd have had some
    concerns about how it was going to go over on the Hill and how
    it was going to be treated. I think I might have said to
    myself, if I ask for a big number, I'm going to be accused of
    asking for more than I need so that I don't have to come back
    very soon and get some more money from Congress and I'm going
    to be criticized for undermining accountability with Congress.
    If I ask for a small number, I could be criticized for not
    saying exactly what it was I really think I'm going to need. If
    I say specifically what I think we're going to need, my best
    guess now as to what we're actually going to spend this money
    on, and I'm probably going to have to change some of that
    later, war being what it is, then I'm going to be accused of
    incompetence and not knowing what I was talking about. But if I
    don't say specifically what I'm going to need for the money,
    then I'm going to be accused of undermining Congress' oversight
    ability by not telling Congress exactly what it is I want.
        I've sat through a lot of these hearings over the years and
    I know, and I think everybody here knows, that there's
    oversight and then there's second-guessing and sometimes it's
    possible that this institution doesn't know the difference. I
    know you had a problem. A war is a messy and difficult thing.
    I've heard a lot here about our oversight responsibilities and
    that's very important. I'm a huge believer in the checks and
    balances in the system.
        The question I ask myself when I consider your request is,
    will it help us win the war? Yes, our oversight
    responsibilities are very important, but more important than
    preserving that is, will giving you this money in this form
    help us win the war? I want you to know, I think it makes some
    sense what you're doing. You're saying, look, we don't know
    what the next 5 or 6 months or 8 or 10 months is going to
    entail exactly. Maybe the transition's going to mean we need to
    train a whole lot more Iraqis or it's going to be a whole lot
    more difficult than it's been. Maybe there will be some
    insurgent leader in some other town besides Fallujah and we're
    going to need more money for that. Maybe we're going to need to
    shift this money here or there.
        I think it makes sense to come in to ask for a relatively
    small number, and to say to us that you're going to report all
    the time to us what you're doing and you're going to have to
    come back pretty quickly and if you don't like what you've done
    with it, you know you're going to hear about it when you come
    back again. I think it's a pretty useful compromise.
        I'll say something else. We're going to end up with some
    compromise version of this, I think, along the lines of what
    Senator Collins had suggested. If you had come in and suggested
    a compromise version, you probably would have ended up being
    told hook, line, and verse exactly what to do. I know it was
    difficult figuring all this out. I think it's going to end up
    that you did a pretty good job, and I'm one Senator on this
    committee who supports the approach that you've taken. Thank
    you, Mr. Chairman.
        Senator Sessions. Thank you, Senator Talent.
        Secretary Wolfowitz. Can I just make one comment apart from
    saying thank you?
        Senator Talent. If you dare, go ahead.
        Secretary Wolfowitz. You've described the needle we're
    trying to thread, but you cited one case, which is we may
    decide we need a lot more Iraqi security forces than we'd
    planned on, and that is the one thing that isn't covered,
    because let me be clear. We have a lot of money for Iraqi
    security forces in the supplemental. We have Iraqi budget money
    that's been applied to Iraqi security forces, over $1 billion.
    I don't know the exact amount, but I'll get it for the record.
        [The information referred to follows:]

        There are two types of funding that have been used in fiscal year
    2004 for Iraqi security forces; the Iraqi Relief and Reconstruction
    Fund Iraq (IRRF) and the Defense Fund Iraq (DFI). The IRRF contains
    $4.281 billion that represents the Department of Defense's funding to
    support security forces. The DFI contains $172 million which has been
    used specifically for security forces.

        If this committee's proposal goes through, we will have
    $150 million for Iraqi security forces that will no longer be
    limited to just the Army. We did ask for $500 million, which
    would give us an extra margin. I must say and I'll say it
    again, we tie our troops' hands when it comes to equipping
    indigenous forces that are fighting with them in a way we
    wouldn't conceive of tying their hands when it comes to
    providing them ammunition. Yet, Iraqi troops in the front lines
    are better than ammunition. They're people dying for their own
    country. More than 300 of them have already died in the line of
    duty. There have been some big disappointments in the last
    couple months, but there were some big successes, especially up
    in Mosul where General Petraeus trained and equipped the Iraqi
    security forces up there.
        So I'll make one more appeal. If this committee would grant
    the President's request in the main budget for $500 million in
    authority rather than $150, we would be very appreciative.
        Senator Talent. I think if all of us would recognize, and
    we do, and I could tell you the respects in which I'm a little
    critical also. I do think you're going to need this money, and
    maybe calling it a contingent is a mistake. This back and forth
    is very important. I think we all have to recognize, sometimes
    you fail to think adequately and sometimes we fail to, that
    there is no way to predict in war with any degree of
    specificity exactly what's going to happen. I'm always worried
    when people ask you for predictions, about what you are going
    to need 6 months from now, because again, if you don't predict,
    then you're accused of not saying what you think, and if you do
    predict, it's probably going to be wrong.
        I think the overall effort on a strategic level is going
    very well. We have the finest people who have ever served in a
    military in the history of mankind, and I think they're pretty
    well led too. Thank you, Mr. Chairman.
        Senator Sessions. Thank you, Senator Talent. Just to get
    this straight, the President has requested in this budget $500
    million for this fiscal year defense bill for training local
    police and security forces?
        Secretary Wolfowitz. Training and equipping security
    forces. We define it somewhat more broadly. This committee
    narrowed it to Iraqi and Afghan security forces.
        Senator Sessions. So if you get that, you'd be able to
    handle that without having to handle this money perhaps.
        Secretary Wolfowitz. No. What I'm saying is we have no
    authority beyond that to dip into this money for Iraqi security
    forces.
        Senator Sessions. All right.
        Secretary Wolfowitz. Or in any other money in our budget.
    We are limited to what's already in the supplemental. Let me
    not be misleading. There's a lot of money in the supplemental,
    but if it's allocated, and sometimes it's tightly allocated and
    we're having some difficult decisions about how much goes to
    the Iraqi army, and how much goes to the civil defense corps.
    Senator Talent referred to the distinct possibility, especially
    if they're successful, that we'll want more Iraqi security
    forces and better equipped Iraqi security forces. The only
    margin we have beyond the considerable money that's already
    budgeted is, because of limitations on authorities, $150
    million. We'd like to raise it to $500 million.
        We have expansive authorities for pretty much everything
    else we do, which is why with consultation and reprogrammings
    and so forth we can move within military accounts. What we
    don't have is the ability to move into this account, which
    people have correctly been concerned that it could be viewed as
    actually doing foreign security assistance by the back door.
        Let me assure you it's not that either. We will not do any
    of that funding without the concurrence of the State
    Department. We've been clear about that and explicit.
        Senator Sessions. Thank you, Mr. Secretary. Senator Levin.
        Senator Levin. Thank you, Mr. Chairman. There was a
    commitment from other countries to contribute towards the
    reconstruction of Iraq, and I'm wondering if you can tell us
    how much money has actually been received.
        Mr. Kaplan. Senator, I don't have those numbers in front of
    me. I know it was included in the most recent quarterly report,
    under section 2207. I'd be happy to take that for the record
    and get you that information.
        Senator Levin. Do you know how many countries made a
    commitment and how many have come through with their
    commitment?
        Mr. Kaplan. Senator, I don't have that number. I am happy
    to respond for the record.
        [The information referred to follows:]
           Implementing Madrid Pledges: Non-U.S. Donor Disbursements
             Of the $32 billion in pledges for 2004-2007 at the
            Madrid Donors' Conference, $13.584 billion was from non-U.S.
            sources. Of this, $5.55 billion was pledged by the World Bank
            and IMF in lending programs. The remaining $8.034 billion was
            from 36 countries and the European Commission.
             Now that there is an internationally recognized
            government in Baghdad, the World Bank and IMF are discussing
            with the new Iraqi Interim Government its interest in their
            lending programs.
             As of June 30, 2004, of the roughly $8 billion in
            donor assistance, other donors had disbursed $1.148 billion of
            their pledges, according to State Department estimates. This
            does not include other assistance these donors already provided
            to Iraq, such as humanitarian assistance, military assistance,
            or other aid to Iraq and the coalition.
             It also undercounts some donors where we do not have
            detailed information or confirmation from the donor countries
            on amounts disbursed for bilateral assistance. For example, the
            State Department understands the U.K. has disbursed about
            another $60 million in bilateral project assistance in addition
            to the U.K. figure reflected in the attached chart that is not
            yet captured in the disbursement numbers.
             The bulk of the $1.148 billion disbursed by donors has
            been in the form of deposits to the International
            Reconstruction Fund Facility for Iraq (IRFFI), which is
            comprised of U.N. and World Bank trust funds. The U.N. and
            World Bank trust funds are now starting implementation of their
            initial IRFFI projects.
             Disbursements and implementation have been complicated
            by the security situation in Iraq, but nonetheless are
            continuing.
             Disbursements by non-U.S. donor countries of over
            $1.148 billion in the first 6 months of a 4-year pledge of $8
            billion indicate a disbursement rate comparable to disbursement
            rates by our donor partners for previous post-conflict
            assistance efforts, though on a bigger scale.
             The Iraqi Interim Government (IIG), through its Iraqi
            Strategic Review Board (ISRB), is playing a central role in
            coordinating donor assistance and setting assistance
            priorities.
             For additional information on reconstruction progress,
            including examples of progress on the ground attributable to
            international donations, please refer to the Quarterly Section
            2207 report on reconstruction progress. This report is posted
            on the White House Web site. Appendix 2 includes international
            donation information.

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Levin. Secretary Wolfowitz, Secretary Rumsfeld, in
    referring to the Geneva Convention in the Iraq context, said
    just a few weeks ago on NBC that the Geneva Convention did not
    apply precisely. Do you know what he meant?
        Secretary Wolfowitz. I think the Geneva Convention, both
    Geneva Conventions 3 and 4, apply in Iraq.
        Senator Levin. Do you know what the Secretary might have
    meant when he said that they did not apply precisely then?
        Secretary Wolfowitz. I don't know.
        Senator Levin. Were you aware of that comment before right
    now?
        Secretary Wolfowitz. I think I had heard something like it,
    and I could speculate, but I'd be speculating.
        Senator Levin. All right. Mr. Feith has made commitments to
    provide materials that he has not kept. Last time you were in
    front of us on April 20 you said you would look into the delay
    of the materials that I had requested back in November 2003. On
    February 26, Mr. Feith promised in a letter to me that he would
    provide those materials quickly and promptly. I still didn't
    receive the letters. Do you know what is going on what that
    commitment?
        Secretary Wolfowitz. Senator, I think there was a big
    package of materials that should have come up yesterday. I'm
    not 100 percent sure. We will check that.
        Senator Levin. Will you let us know what is going on? One
    way or the other, will you get back to us?
        Secretary Wolfowitz. Yes.
        Senator Levin. Tell us when that's going to be forthcoming.
        Secretary Wolfowitz. I hope I can tell you it's here.
        Senator Levin. The way I see these pledges of other
    countries to Iraq reconstruction is that there's $13 billion
    that had been promised by 1, 2, 3, 4, 5, 6, 7, 8, 9, 10
    countries. Does that sound right, Mr. Kaplan? Does anybody
    follow this? Japan committed $4.9 billion. Do you have any idea
    how much of that they've come through with?
        Mr. Kaplan. Senator, I have in front of me the amounts of
    the pledges.
        Senator Levin. I don't want the pledges. I want to know
    whether they've kept their pledges.
        Mr. Kaplan. Senator, I don't have that in front of me, but
    as I say, we'll be happy to provide it for the record.
        Senator Levin. Do you have a sense as to whether most of
    the pledges have been kept by most of the countries?
        Secretary Wolfowitz. Senator Levin, we've had difficulty in
    Afghanistan, I know, in slow delivery by the international
    community on their pledges. I think it's even slower in Iraq
    because of the security conditions there. We'll have to get you
    the exact numbers.
        Senator Levin. So the security conditions are difficult
    enough. That's no excuse for the pledges not being fulfilled,
    is it?
        Secretary Wolfowitz. The pledge was not for an expenditure
    by this particular month. It's over a period of time.
        Senator Levin. But some of it has been owing so far, I
    assume, right? Some of the pledges have supposed to have been
    arrived by now?
        Secretary Wolfowitz. You'd have to ask the State Department
    or Secretary Powell, who chaired the Madrid meeting. I don't
    believe they pledged a specific time schedule. I think they
    pledged certain amounts within a couple of years.
        Senator Levin. Does OMB know? Does OMB track this?
        Mr. Kaplan. We collect the information from the appropriate
    Departments, Senator.
        Senator Levin. Okay. Would you let the committee know
    something that I think we should be on top of? I mean, it's
    already pretty tiny compared to what our commitment is. It
    seems to me at a minimum somebody ought to be knowing whether
    or not other countries that have made these minimal pledges
    have come through with even whatever they've pledged.
        The $25 billion that you request also is funding that does
    not expire, so it's a no-year request. Would you agree with
    that characterization?
        Mr. Kaplan. Yes, Senator.
        Senator Levin. There's no time limit on it?
        Mr. Kaplan. That's correct, Senator, although it's our
    intention that if Congress funds our forthcoming supplemental
    request for fiscal year 2005, those funds would supersede
    whatever is remaining in the contingent emergency reserve.
        Senator Levin. All right. I just want to be clear on this
    one question, which came up before about these interrogation
    rules. There were rules for Guantanamo, is that correct,
    Secretary Wolfowitz?
        Secretary Wolfowitz. Yes.
        Senator Levin. Were you familiar with those?
        Secretary Wolfowitz. Familiar might be overstating it, but
    yes, I've seen them.
        Senator Levin. Okay. Were you part of the approval process
    for those rules of interrogation for Guantanamo?
        Secretary Wolfowitz. Yes.
        Senator Levin. Okay. But on these rules relative to Iraq of
    General Sanchez, you were not aware of these until just a
    couple of days ago?
        Secretary Wolfowitz. Actually, I was not aware of them
    until this morning.
        Senator Levin. Okay. General Pace, does that also go for
    you and the chiefs, that you were not aware of these until the
    last few days, or were you?
        General Pace. I do not know about the other chiefs, sir. I
    personally was aware of the ones for Guantanamo. I was not
    aware of the ones for Iraq.
        Senator Levin. Could you check out and see whether or not
    these rules were ever submitted to the chiefs or whether they
    were aware of them?
        General Pace. I will find out the individual chiefs. They
    were not submitted to the Joint Chiefs. I will find out if any
    of the service chiefs knew.
        Senator Levin. Okay. General Pace, I asked you before about
    this use of the term, rules of engagement, relative to
    interrogation, and I found it so shocking that that term, rules
    of engagement, which normally applies to when force is going to
    be permitted, would apply to that term interrogation. Do you
    remember, either of you, relative to the Guantanamo rules of
    interrogation, whether or not they were called rules of
    engagement?
        General Pace. To my knowledge, they were not, sir. That is
    a term that does not have any military definition to it to my
    knowledge, rules of engagement for interrogation. Rules of
    engagement apply to the use of force and the way they are
    authorized to use force.
        Senator Levin. What about you, Secretary Wolfowitz? Do you
    remember whether or not that term was used relative to
    Guantanamo?
        Secretary Wolfowitz. I certainly don't remember it being
    used.
        Senator Levin. Mr. Chairman, if I could have just one more
    question, even though my time, I notice, is expired. I think
    this would be all that I would need. Let's see if I can find
    this term. This was a statement in the annex of the Taguba
    report. It was an unclassified, December 12, 2003, situation
    update to Major General Miller, and the document describes
    interrogation techniques permissible for use in the Iraqi
    theater. It includes the following statement: ``Interrogation
    officer in charge will submit memoranda for the record
    requesting harsh approaches for commanding General's approval
    prior to employment, sleep management, sensory deprivation,
    isolation longer than 30 days, and dogs.'' Is that something
    that either of you are familiar with, Secretary Wolfowitz?
        Secretary Wolfowitz. No, I'm not.
        Senator Levin. General Pace?
        General Pace. No, sir, I haven't seen that.
        Senator Levin. Have you ever seen the term, harsh
    approaches, used relative to interrogation as being something
    that would be permitted? Is that a term which is used in a
    sense that harsh approaches can be authorized under certain
    circumstances, Secretary?
        Secretary Wolfowitz. I don't recall it being used in any of
    the Guantanamo techniques that we discussed.
        Senator Levin. Or anything else you've seen?
        Secretary Wolfowitz. No.
        Senator Levin. General Pace?
        General Pace. It's not a term I'm familiar with, sir.
        Senator Levin. Has Secretary Rumsfeld or you ever signed
    exceptions or approvals for the use of force in specific
    instances, either in Guantanamo or in Iraq that you know of?
    Has there ever been a request for authorization to use certain
    techniques relative to specific detainees that required
    secretarial approval that have come to your attention in
    Guantanamo or in Iraq?
        Secretary Wolfowitz. I think you had testimony in closed
    testimony yesterday on issues about interrogation. I don't
    believe they talk about the use of force, but there are certain
    things, and I think you were in that session and I'd be happy
    to have someone come back and answer any further questions you
    have on it in a closed session.
        Senator Levin. The Guantanamo rules did provide for a
    certain secretarial approval, did they not, of certain kinds of
    techniques?
        Secretary Wolfowitz. That's right.
        Senator Levin. Without asking you which cases, do you know
    whether there were some approvals given relative to Guantanamo?
        Secretary Wolfowitz. I believe there were.
        Senator Levin. I'm not saying that was use of force. I'm
    just saying there was use of certain techniques which
    required----
        Secretary Wolfowitz. To the best of my recollection, and my
    recollection is pretty old on this, it did not involve the use
    of force, and so we're clear on this, it was a very exceptional
    authority to be used in the case of people who had information
    about possible major terrorist plots against the United States.
    That's why that authority was there. The extreme care with
    which any special techniques, all of which had to comply with
    human treatment standards.
        Senator Levin. Under Geneva?
        Secretary Wolfowitz. Under Geneva. I mean, even the special
    techniques were judged by the lawyers to be compliant. The
    extreme care with which some of those could only be used
    emphasizes the fact that there was nothing about the Guantanamo
    operation that can explain the incredible abuses that took
    place in Iraq.
        Senator, you and many other members of this committee have
    been to Guantanamo. I think you've seen first hand that this is
    an operation that we believe met very high standards.
        Senator Levin. Thank you.
        Senator Sessions. Thank you, Senator Levin. I know we've
    kept you past your time. I served on the Judiciary Committee
    for a brief few years, filled a Judge Advocate General (JAG)
    slot, although I'll admit I did not do JAG officer schooling,
    at the Army Reserve that I served in for several years. With
    regard to the Geneva Convention and Secretary Rumsfeld's
    statement that it did not apply precisely, I would assume, and
    anybody, you're wise not to speculate, but I'll speculate that
    what he meant was unlawful combatants who are in Iraq, just
    like the unlawful combatants in Guantanamo, are not entitled to
    protection under the Geneva Conventions.
        However, the DOD said regardless they will all be treated
    under the Geneva Conventions. Is that correct?
        Secretary Wolfowitz. Yes, with one qualification as I
    understand it, and I'm not a lawyer. The Geneva Convention
    requires----
        Senator Sessions. Senator Levin will catch us if we make an
    error.
        Secretary Wolfowitz.--humane treatment for all detainees.
    It gives special and very important privileges to lawful
    combatants that are prisoners of war.
        Senator Sessions. Yes, and just to follow up on that, in
    Guantanamo, you had required approval higher up. General Pace,
    you've been a commander in the field. General Sanchez's
    memorandum about harsher approaches, that's a restrictive
    memorandum, is it not? In other words, General Sanchez said,
    some of these things may be legitimate, if you desire to go
    into these category of interrogation techniques, I want a
    written request from the field and I want to approve it first.
    Isn't that what he was saying?
        General Pace. That would be a restrictive guidance from the
    commander, the way it was read and the way I heard it, I heard
    that as restrictive.
        Senator Sessions. It was not a permissive memorandum to go
    do all these things. It said, if you're thinking about these
    things, seek my approval in writing. Does he have a legal
    officer on his staff there that could help him?
        General Pace. He does, yes, sir.
        Senator Sessions. They know all these case histories of the
    Geneva Conventions and can advise him correctly. Things went
    awry. We're not happy with it. They went awry and it's not
    good. I don't think that memorandum should be seen as a
    permissive suggestion that they should go beyond the Geneva
    Conventions.
        I agree with Senator Levin about these pledges. I think
    it's time for us to ask our allies why they are not on board,
    not having come along. I know some of them did not make
    specific dates as to when they would do this, but sometimes the
    time is now it seems to me.
        Secretary Wolfowitz. I agree with both of you. Maybe I
    should have been clearer about that. I think we should be
    careful about whether they've broken a pledge, but I think our
    allies should be doing more, not less, absolutely.
        Senator Sessions. They're helping a good bit in
    Afghanistan, although some of that has been slow. There was a
    suggestion earlier that the administration made these promises
    about how many troops there would be utilized and how long we
    would be there. Mr. Secretary, have you ever stated, or the
    Secretary of Defense, or the President to your knowledge, said
    that by a certain date we would be out of Iraq, that we'd only
    use so many troops? Isn't it true the President has told us
    we're going to do what it takes to be successful and it's going
    to take a long time to win the war on terrorism?
        Secretary Wolfowitz. Yes, Senator, and I've tried always to
    emphasize the great uncertainty of war. I frankly anticipated
    many things much worse than we've encountered that fortunately
    didn't take place, and actually I shared Senator Levin's fear
    that the greatest danger in this war was going to be the
    possibility that he would actually use WMD, because we both
    believed he had them.
        There are a lot of things that didn't happen that would
    have been much worse. The thing that did happen that has led to
    this continuing war is that the enemy that was defeated in
    major combat on May 2 dispersed into the countryside, and what
    we're dealing with now are some tough, ruthless killers who
    were the core of that abusive regime for 35 years. They know
    how to build bombs, they know how to murder people, they know
    how to kill and assassinate and that's what their specialty is.
    They offer no hope for the country, that's what I said before.
        We need to speed up the process so that Iraqis understand
    we're not there to own their country. They have to step up and
    take responsibility. There's a really positive vision and
    Iraqis are hungry for it.
        Senator Sessions. I think this has been a good hearing. I
    think you've heard from this side of the aisle and the desk and
    you've indicated you'll try to respond as you can to meet the
    concerns. The Senate committee has made it clear that we're
    willing to support the troops and get this funding as you need
    it.
        Senator Levin. Just one more question for General Pace.
    General Pace, there was a decision made basically to expand the
    Iraqi army or not to try to reconstitute elements of the Iraqi
    army right after the war. Was that a decision of the chiefs or
    was that made by someone else?
        General Pace. Sir, I think it happened at first on the
    battlefield when the Iraqi army disintegrated, so that the
    units that we expected might be there----
        Senator Levin. I mean after the battles were over. We
    understand. There was a decision made not to attempt to
    reconstitute those units even eliminating the top level
    officers of the Baath party. There was a specific decision that
    was made not to try to reconstitute those units. Did the chiefs
    support that or make that decision or recommend that decision?
        General Pace. Sir, to my knowledge, certainly I know I did
    not have a discussion about that with my fellow chiefs in the
    tank. That decision to my recollection was made inside of Iraq
    in the CPA, who had the responsibility, Ambassador Bremer and
    his team had the responsibility to work with rebuilding the new
    Iraqi army with the Governing Council. That was a decision made
    in theater.
        Senator Levin. A decision of that magnitude which has had
    such implications and such ramifications surely should have
    involved our top military leadership, and I've been critical of
    the decision right from the beginning, but I'm also critical of
    the failure to involve our top military leadership from what I
    can tell. I've been unable to identify our top military uniform
    leaders that have been involved in that decision and I think it
    was the wrong decision, but it was surely wrong not to include
    the chiefs.
        General Pace. From my perspective, sir, the enemy had
    disintegrated on the battlefield.
        Senator Levin. We wanted them to disintegrate too, didn't
    we? We urged them not to fight, didn't we?
        General Pace. We urged them not to fight. We were hopeful
    that some might surrender en masse and actually start working
    for the future of the Iraqi people. That did not happen. Then
    after we were stood up as the governing authority, and the
    question was, how to go out and resurrect these units that have
    dispersed to places we don't know, and if we did, how do we do
    that? Or do we start recruiting for the new Iraqi army?
        Senator Levin. Reconstituting the units, right.
        General Pace. I'm sorry, sir.
        Senator Levin. Right. That was the question. But you're
    saying you were not involved----
        Secretary Wolfowitz. Senator Levin, it was a conscript
    army. These people went home.
        Senator Levin. I understand.
        Secretary Wolfowitz. I remember television coverage of
    people walking from northern Iraq to southern Iraq. The issue
    was what do you do with the officer corps? I think hindsight is
    20/20. This was, as General Pace said, a CPA decision. I think
    it was recommended back here and approved back here.
        Senator Levin. By?
        Secretary Wolfowitz. By Ambassador Bremer.
        Senator Levin. It was recommended to you?
        Secretary Wolfowitz. To Secretary Rumsfeld. He reports to
    the President through Secretary Rumsfeld.
        Senator Levin. But my point is that the uniform
    leadership----
        Secretary Wolfowitz. Can I finish for a minute?
        Senator Levin. Sure.
        Secretary Wolfowitz. Because you say it was an obvious
    mistake.
        Senator Levin. But that's not my point.
        Secretary Wolfowitz. First of all, there wasn't an army to
    hang together. The mistake with 20/20 hindsight, I believe, and
    I think most people would agree, was that when it was
    disbanded, it took a long time before it was clear that the
    people who were cashiered would get pensions. If that had been
    made clear from the beginning, we would have avoided a
    significant problem. The officer corps is not by any means
    black and white. We just brought back one of those officers in
    Fallujah and we pretty much had to sideline him immediately
    because he was working with the enemy. We need clean, new
    officers.
        Senator Levin. We agree on that. The question isn't whether
    it was black and white. I think it was a mistake, okay, and I
    said so at the time, so it wasn't 20/20 hindsight, but that's
    beside the point who's right on this. My point here is
    apparently our top uniform military leadership here were not
    involved in that decision. That's my point.
        General Pace. Sir, I should stand up to my responsibilities
    there. I was certainly aware that that decision had been taken.
    I was certainly aware that that recommendation had come
    forward. I had the opportunity as an adviser and a
    responsibility as an adviser that if I thought that was a wrong
    thing to have stood up and be counted. I looked at it. I
    thought it was a correct decision based on----
        Senator Levin. So you were asked for your advice?
        General Pace. No, sir. I was not specifically asked for my
    advice on that. However, I have a responsibility as a member of
    the Joint Chiefs to proffer my advice, to be knowledgeable, and
    to as best I can give my best advice. We looked at this, I
    looked at it for sure. They had disintegrated, and the decision
    that was made was whether we go out and try to resurrect units
    that have disappeared or should we start recruiting to a new
    army and vet those as we come on board. That made sense to me.
        Senator Levin. My only question is whether you were
    consulted and you weren't. You're now saying that you feel you
    should have initiated comment had you disagreed with it, and I
    agree with that. My only question is, were the Joint Chiefs
    consulted for formal consideration, but apparently they
    weren't. I think that's just a generally bad, ineffective, and
    insufficient process. That's my only point here. Whether it was
    right or wrong we can differ on.
        Secretary Wolfowitz. Senator Levin, do you think we should
    have called the army back, summoned these conscripts back to
    the army? I think that would have been a terrible mistake. I
    think it was a mistake not to let them know that when they were
    in effect being retired, that they would also be paid. That I
    think we might agree on, but I think it would have been a big
    mistake to summon Saddam's army back to active duty when they--
    --
        Senator Levin. You can call it Saddam's army, but as you
    point out, it was a conscript army. Many of that army hated
    Saddam, and didn't fight for him. We wanted them not to fight
    for him.
        Secretary Wolfowitz. They didn't want to be drafted back
    in.
        Senator Levin. It was not a matter of being drafted back
    in, it was a matter of whether they would voluntarily rejoin
    units to defend a new Iraq. Instead we have no army. We still
    have about 9,000 out of a huge need much greater than that in
    an army. But we can argue back and forth whether it was a wise
    decision or not. I just think that what is not wise is not to
    formally inquire of our top uniform leadership what they think.
    I think General Pace is magnanimously saying that he should
    have initiated if he had disagreed with it. That's fine, that's
    magnanimous. That's not the way this process should work. Our
    top uniform, and best thinking, should be solicited on an issue
    of that magnitude. It shouldn't be left up to just some kind of
    a point paper, which is what it was.
        Senator Sessions. Thank you, Senator Levin. I know you've
    expressed that prior to the decision being made and he still
    adheres to it and that's all right.
        If there's nothing else, you're beyond the time that we
    asked you to stay. We thank you for your service and for your
    support. This Senate will give you, and our soldiers, the money
    they need. We just need to work out the details about how it'll
    get done. Thank you. We are adjourned.
        [Question for the record with answer supplied follows:]
                   Question Submitted by Senator Mark Dayton
                      rest and recuperation leave program
        1. Senator Dayton. Secretary Wolfowitz, it is very important to me
    that the military continue to pay travel expenses in relation to the
    Rest and Recuperation (R&R) Leave Program for servicemembers deployed
    in support of Operation Iraqi Freedom (OIF) and Operation Enduring
    Freedom (OEF). Do you currently have the funds available to continue
    the R&R Leave Program, including the travel between the domestic point
    of entry and the servicemembers' homes?
        Secretary Wolfowitz. On September 25, 2003, the United States
    Central Command initiated the R&R Leave Program for Active and Reserve
    servicemembers and DOD civilian employees serving on a 12-month tour of
    duty within Central Command Area of Responsibility in support of the
    global war on terror. On January 1, 2004, we implemented the Fully
    Funded Onward Travel Program, which pays the air travel expenses to the
    commercial airport nearest the leave destination.
        P.L. 108-220, April 22, 2004, requires the Secretary of Defense to
    reimburse military R&R travelers for certain transportation expenses
    incurred on R&R leave before the program was expanded to include
    domestic travel. The law does not provide additional funding, however,
    and we expect that these costs will range from $13 million to $19
    million.
        Implementation instructions for retroactive reimbursement of R&R
    travel are still pending. The $55 million supplemental that was
    established for onward travel is not sufficient to cover onward travel
    and retroactive reimbursement through fiscal year 2004. The DOD should
    be able to cover the cost by reallocating operations and maintenance,
    Army (OMA) funds already earmarked for other R&R expenses.

        [Whereupon, at 1:17 p.m., the committee adjourned.]