[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]







                         [H.A.S.C. No. 111-177]

 
     THE FINAL REPORT OF THE INDEPENDENT PANEL'S ASSESSMENT OF THE 
                       QUADRENNIAL DEFENSE REVIEW

                               __________

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                              HEARING HELD

                             JULY 29, 2010


                                     
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                   HOUSE COMMITTEE ON ARMED SERVICES
                     One Hundred Eleventh Congress

                    IKE SKELTON, Missouri, Chairman
JOHN SPRATT, South Carolina          HOWARD P. ``BUCK'' McKEON, 
SOLOMON P. ORTIZ, Texas                  California
GENE TAYLOR, Mississippi             ROSCOE G. BARTLETT, Maryland
SILVESTRE REYES, Texas               MAC THORNBERRY, Texas
VIC SNYDER, Arkansas                 WALTER B. JONES, North Carolina
ADAM SMITH, Washington               W. TODD AKIN, Missouri
LORETTA SANCHEZ, California          J. RANDY FORBES, Virginia
MIKE McINTYRE, North Carolina        JEFF MILLER, Florida
ROBERT A. BRADY, Pennsylvania        JOE WILSON, South Carolina
ROBERT ANDREWS, New Jersey           FRANK A. LoBIONDO, New Jersey
SUSAN A. DAVIS, California           ROB BISHOP, Utah
JAMES R. LANGEVIN, Rhode Island      MICHAEL TURNER, Ohio
RICK LARSEN, Washington              JOHN KLINE, Minnesota
JIM COOPER, Tennessee                MIKE ROGERS, Alabama
JIM MARSHALL, Georgia                TRENT FRANKS, Arizona
MADELEINE Z. BORDALLO, Guam          BILL SHUSTER, Pennsylvania
BRAD ELLSWORTH, Indiana              CATHY McMORRIS RODGERS, Washington
CAROL SHEA-PORTER, New Hampshire     K. MICHAEL CONAWAY, Texas
JOE COURTNEY, Connecticut            DOUG LAMBORN, Colorado
DAVID LOEBSACK, Iowa                 ROB WITTMAN, Virginia
JOE SESTAK, Pennsylvania             MARY FALLIN, Oklahoma
GABRIELLE GIFFORDS, Arizona          DUNCAN HUNTER, California
NIKI TSONGAS, Massachusetts          JOHN C. FLEMING, Louisiana
GLENN NYE, Virginia                  MIKE COFFMAN, Colorado
CHELLIE PINGREE, Maine               THOMAS J. ROONEY, Florida
LARRY KISSELL, North Carolina        TODD RUSSELL PLATTS, Pennsylvania
MARTIN HEINRICH, New Mexico          CHARLES K. DJOU, Hawaii
FRANK M. KRATOVIL, Jr., Maryland
BOBBY BRIGHT, Alabama
SCOTT MURPHY, New York
WILLIAM L. OWENS, New York
JOHN GARAMENDI, California
MARK CRITZ, Pennsylvania
LEONARD BOSWELL, Iowa
DAN BOREN, Oklahoma
HANK JOHNSON, Georgia

                     Paul Arcangeli, Staff Director
                 Mark Lewis, Professional Staff Member
                Roger Zakheim, Professional Staff Member
                    Caterina Dutto, Staff Assistant


                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2010

                                                                   Page

Hearing:

Thursday, July 29, 2010, The Final Report of The Independent 
  Panel's Assessment of the Quadrennial Defense Review...........     1

Appendix:

Thursday, July 29, 2010..........................................    35
                              ----------                              

                        THURSDAY, JULY 29, 2010
     THE FINAL REPORT OF THE INDEPENDENT PANEL'S ASSESSMENT OF THE 
                       QUADRENNIAL DEFENSE REVIEW
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

McKeon, Hon. Howard P. ``Buck,'' a Representative from 
  California, Ranking Member, Committee on Armed Services........     2
Skelton, Hon. Ike, a Representative from Missouri, Chairman, 
  Committee on Armed Services....................................     1

                               WITNESSES

Hadley, Hon. Stephen J., Co-Chairman, Quadrennial Defense Review 
  Independent Panel, United States Institute for Peace...........     5
Perry, Hon. William J., Co-Chairman, Quadrennial Defense Review 
  Independent Panel, United States Institute for Peace...........     6

                                APPENDIX

Prepared Statements:

    McKeon, Hon. Howard P. ``Buck''..............................    42
    Perry, Hon. William J., joint with Hon. Stephen J. Hadley....    45
    Skelton, Hon. Ike............................................    39

Documents Submitted for the Record:

    [There were no Documents submitted.]

Witness Responses to Questions Asked During the Hearing:

    [There were no Questions submitted during the hearing.]

Questions Submitted by Members Post Hearing:

    [There were no Questions submitted post hearing.]
     THE FINAL REPORT OF THE INDEPENDENT PANEL'S ASSESSMENT OF THE 
                       QUADRENNIAL DEFENSE REVIEW

                              ----------                              

                          House of Representatives,
                               Committee on Armed Services,
                           Washington, DC, Thursday, July 29, 2010.
    The committee met, pursuant to call, at 10:11 a.m., in room 
2118, Rayburn House Office Building, Hon. Ike Skelton (chairman 
of the committee) presiding.

 OPENING STATEMENT OF HON. IKE SKELTON, A REPRESENTATIVE FROM 
        MISSOURI, CHAIRMAN, COMMITTEE ON ARMED SERVICES

    The Chairman. Welcome to the Armed Services Committee. 
Today we meet to receive testimony from the co-chairmen of the 
Independent Panel reviewing the 2010 Quadrennial Defense Review 
[QDR]. Joining us today are the Honorable William J. Perry and 
the Honorable Stephen J. Hadley. We certainly welcome you and 
thank you for another one of your great contributions to our 
country. We appreciate it.
    Today we receive the final report from the panel as 
required by last year's defense bill. This is the fourth QDR 
oversight-related event this committee has held, and I think 
that reflects how important we consider the QDR to be.
    I would like to tell you right at the outset how impressed 
I am with this report. It will take several close readings to 
fully digest it, but I have to tell you, it has clearly met 
Congress' intent. And furthermore this bipartisan panel of 
experts has unanimously endorsed the entire report and that, of 
course, is a testimony to the co-chairs' wisdom and leadership.
    As I mentioned at our last hearing, the report of the QDR 
is an important input into how Congress conducts its oversight. 
Conducting that review is an enormous task, and I will take a 
moment to once again commend the secretary, Secretary Gates on 
his leadership. He, rightly in my opinion, focused his effort 
on winning the wars we are in today.
    But we cannot do that at the expense of preparing for the 
future, and there I am concerned that the QDR came up a bit 
short. I see that the independent panel has come to about the 
same conclusion.
    I hope to use our time today to explore those findings and 
hear your recommendations so that Congress can get on with our 
critical task of providing appropriate resources on national 
security.
    I see, for example, that you recommend an increase in our 
force structure in the Asia-Pacific area, and specifically 
highlight the need for a larger Navy. Of course, I have been 
making the very same point for years.
    On the other hand, I was very surprised to see the report 
indicate that you thought the current end-strength of our 
active duty ground forces, Army and Marines, is sufficient. I 
respect your opinion, but I find that difficult to understand.
    Watching the toll these wars have placed on our forces, I 
have been an advocate for increasing force strength for quite a 
while now, actually beginning back in 1995. I would caution 
against being too optimistic about the demand for these forces 
in the future and would like to hear the reasoning behind your 
panel's position.
    I know we will get into specifics of that recommendation 
and many others, but first I would like to say that as a 
longtime supporter of the professional military education [PME] 
system and the Goldwater-Nichols personnel reforms in the 
Department of Defense [DOD], I was encouraged to see how 
thoroughly the review panel treated those topics.
    You make a lot of very interesting recommendations. 
Establishing an interagency assignment exchange program, 
incentives to encourage civilian national security 
professionals to participate in such a program, and the 
creation of a consortium of schools and universities to develop 
and teach a common national security education curriculum.
    I believe such steps are the only way to create effective, 
long-lasting cultural change in our stovepiped national 
security system. We must focus on people.
    The review panel has charged Congress to act on these 
important recommendations. I encourage my colleagues to 
strongly consider their recommendations. As the panel's report 
says, our national security system was designed for a world 
that has long since disappeared.
    We must find a new approach to meet the dynamic and quite 
complex threats of today. These interagency national security 
personnel reforms recommended by the panel are, frankly, a good 
place to start.
    Now, let me turn to my ranking member and a good friend, 
the gentleman from California, Mr. McKeon.
    [The prepared statement of Mr. Skelton can be found in the 
Appendix on page 39.]

 STATEMENT OF HON. HOWARD P. ``BUCK'' MCKEON, A REPRESENTATIVE 
  FROM CALIFORNIA, RANKING MEMBER, COMMITTEE ON ARMED SERVICES

    Mr. McKeon. Thank you very much, Mr. Chairman. Welcome back 
to our witnesses, our co-chairs Secretary Perry, Ambassador 
Hadley, thank you for being here this morning. I really want to 
commend you for agreeing to serve as panel co-chairs and 
congratulate you on delivering a nonpartisan consensus report.
    You know, in this time of so much partisanship you are 
really to be commended, you and the members of your panel for 
how you have pulled together and when I say not bipartisan, 
nonpartisan report I think you have done an outstanding job.
    Let me also take a moment to thank the other panel members, 
those who are here and those who are not able to be here. I 
would particularly like to thank my appointees to the panel, 
Ambassador Edelman and Senator Talent for their hard work and 
dedication to the panel.
    Let me start by praising this report. It is a substantive, 
provocative, and responsible product. I anticipate the panel's 
findings and recommendations will be studied on both sides of 
the river and will impact the work of this committee.
    Most importantly this report provides to Congress what the 
2010 QDR failed to do. It took a look at the challenges our 
military will face beyond the next five years and made 
recommendations free of budgetary constraints about the type of 
force and capabilities our military will need for tomorrow.
    The report rightly states that our Nation cannot afford 
business as usual, and warns of a potential train wreck coming 
in the areas of personnel, acquisition, and force structure.
    Significantly, the report offers a realistic view of the 
global security environment: that maintaining and growing our 
alliances will place an increased demand on American hard power 
and require an increase in our military's force structure.
    The release of your panel report cannot come at a better 
time. Despite the many challenges our military faces, 
Washington is abuzz with talk of cutting the Defense budget to 
solve the enormous federal debt.
    Just last week, the New York Times ran a front page story 
saying that, ``The Pentagon is facing intensifying political 
and economic pressures to restrain its budget, setting up the 
first serious debate since the terrorist attacks of 2001 about 
the size and costs of the armed services.''
    What it appears to be a serious debate on Defense spending 
as the New York Times suggests, then I think this panel's views 
need to be front and center.
    As we consider and discuss the panel's findings and 
recommendations, we must keep in mind that this report reflects 
the consensus views of a bipartisan group of 20 national 
security experts.
    This panel truly transcends partisan divide. In my opinion, 
the panel's report repudiates those seeking a peace dividend 
and reaffirms the need to prioritize investment in our national 
defense.
    While the report covers a lot of ground on issues ranging 
from acquisition and contracting to whole-of-government reform, 
I want to focus on the core issues of global threats, force 
structure, and modernization.
    This panel has a number of strong statements on the 
military's role in securing America's interests in the world. 
While it has become in vogue to bemoan the militarization of 
foreign policy, I think the report gets the balance correct.
    You rightly state that the last 20 years have shown that 
America does not have the option of abandoning a leadership 
role in support of its national interests. Military decline is 
not an option.
    With respect to force structure, the panel echoes many of 
the views expressed by members of this committee. We share the 
panel's concern that there is a growing gap between our 
interests and our military capability to protect those 
interests in the face of a complex and challenging security 
environment.
    And while the Secretary of Defense may think the total 
tonnage of the U.S. Navy compared to the tonnage of other 
navies is the metric for assessing our ship requirement, many 
on this committee will agree with the panel's finding that 
military power is a function of quantity as well as quality.
    If we are going to abandon the current decline and malaise 
and reassert America's global leadership role, the United 
States must have sufficient naval forces to patrol all the 
world's oceans. Numbers do matter.
    Thus, I welcome and am interested in learning more about 
the panel's recommendation to increase the size of the Navy and 
Air Force. Moreover, I hope our witnesses will discuss why the 
panel concluded that the QDR force structure may not be 
sufficient to assure others that the U.S. can meet its treaty 
commitments in the face of China's military capabilities.
    I also welcome the panel's recognition that part and parcel 
of force structure is addressing modernization. Our committee's 
many hearings seem to validate the report's finding that 
modernization has suffered for a long time because of the need 
to sustain readiness and the cost of current operations. I 
share your view that modernization is now coming due.
    Finally, this report makes significant contributions to 
challenges the department faces in acquisition and contracting. 
However, I think the report rightly puts those challenges in 
perspective.
    I agree with the finding that we cannot reverse the decline 
of shipbuilding, buy enough naval aircraft, recapitalize Army 
equipment, buy the F-35 requirement, purchase a new aerial 
tanker, increase deep strike capability, and recapitalize the 
bomber fleet just by saving $10 billion to $15 billion that the 
Department of Defense hopes to save through acquisition reform.
    This report highlights many challenges this committee must 
address. I look forward to beginning that work today. Once 
again, thank you for being here this morning, for your service, 
for your report. I look forward to your testimony, and I yield 
back, Mr. Chairman.
    [The prepared statement of Mr. McKeon can be found in the 
Appendix on page 42.]
    The Chairman. I certainly thank the gentleman from 
California. Dr. Perry, we understand that you have a drop-dead 
time at 12:30. We will do our very, very best. We will stand by 
the five-minute rule the very, very best we can.
    I also notice members of your panel, General Robert Scales, 
Professor Richard Kohn, and John Nagl are with us. He is right 
behind you. And staff director Paul Hughes, who helped glue all 
this together. We thank you for your service, and we are much 
appreciative.
    With that, Dr. Perry we will start with you then go on to 
Mr. Hadley. You will have to----
    Dr. Perry. Thank you, Mr. Chairman. We have divided the 
report between Mr. Hadley and myself and actually he is going 
to start first. Thank you.
    The Chairman. Mr. Hadley, please.

 STATEMENT OF HON. STEPHEN J. HADLEY, CO-CHAIRMAN, QUADRENNIAL 
 DEFENSE REVIEW INDEPENDENT PANEL, UNITED STATES INSTITUTE FOR 
                             PEACE

     Mr. Hadley. We saved the heavy lifting for the secretary. 
Chairman Skelton, Ranking Member McKeon, we want to thank you 
for the opportunity to appear before you and members of this 
distinguished committee to discuss the final report of the 
Quadrennial Defense Review independent panel.
    The Congress and Secretary Gates gave us a remarkable set 
of panel members, who devoted an enormous amount of time and 
effort to this project. It was a model of decorum and 
bipartisan legislative-executive branch cooperation.
    Paul Hughes as executive director of the panel ably led a 
talented expert staff and the result is the unanimous report 
you have before you entitled ``The QDR in Perspective, Meeting 
America's National Security Needs in the 21st Century.''
    Our report is divided into five parts. The first part 
conducts a brief survey of American foreign policy with special 
emphasis on the missions that America's military has been 
called upon to perform since the fall of the Berlin Wall.
    From the strategic habits and actual decisions of American 
presidents since 1945, habits and decisions that have shown a 
remarkable degree of bipartisan consistency, we deduce four 
enduring national interests which will continue to transcend 
political differences and animate American policy in the 
future.
    Those enduring national interests include the defense of 
the American homeland, assured access to the sea, air, space 
and cyberspace, the preservation of a favorable balance of 
power across Eurasia that prevents authoritarian domination of 
that region and providing for the global common good through 
such actions as humanitarian aid, development assistance, and 
disaster relief.
    We also discussed the five greatest potential threats to 
those interests that are likely to arise over the next 
generation. Those threats include but are not limited to 
radical Islamist extremism and the threat of terrorism, the 
rise of new global great powers in Asia, continued struggle for 
power in the Persian Gulf, and the greater Middle East and 
accelerating global competition for resources and persistent 
problems of failed and failing states.
    These five global trends have framed a range of choices for 
the United States. We talk about this in the introduction to 
our report. We note the various tools of smart power, 
diplomacy, engagement, trade, other things that will 
increasingly be needed to protect our Nation and its interests.
    We talk about the opportunity of using international 
institutions, adapting them to the new requirements of the 21st 
century, and creating new institutions as appropriate.
    But we emphasize that the current trends are likely to 
place an increased demand on American hard power to preserve 
regional balances. That while diplomacy and development have 
important roles to play, the world's first order concerns will 
continue to be security concerns.
    In the next few chapters we turn to the capabilities that 
our government must develop and sustain in order to protect our 
enduring interests. We first discuss the civilian element of 
national power, what Secretary Gates has called ``the tools of 
soft power.''
    We make a number of recommendations for the structural and 
cultural changes in both the executive branch and the 
legislative branch that will be necessary if these elements of 
national power are to play their role in protecting America's 
enduring interests.
    The panel notes with extreme concern that our current 
federal government structure, both executive and legislative, 
and in particular those related to security, were fashioned in 
the 1940s and they work at best imperfectly today. A new 
approach is needed, and we tried to describe that approach in 
our report.
    Let me turn to my colleague, Bill Perry, to summarize the 
balance of our report.
    [The joint prepared statement of Mr. Hadley and Dr. Perry 
can be found in the Appendix on page 45.]

 STATEMENT OF HON. WILLIAM J. PERRY, CO-CHAIRMAN, QUADRENNIAL 
 DEFENSE REVIEW INDEPENDENT PANEL, UNITED STATES INSTITUTE FOR 
                             PEACE

    Dr. Perry. Thank you, Steve. And thank you very much, Mr. 
Chairman and Mr. McKeon.
    For many decades during the Cold War, the primary mission 
of the Defense Department was to build a force capable of 
containing and deterring the Soviet Union.
    The Defense Department recognized that we might be faced 
with other missions, but we considered them to be lesser 
included cases. That is whatever force we had capable of doing 
the primary mission would automatically be capable of doing the 
other missions.
    In 1993, when I became the deputy secretary, the Cold War 
was over. We needed a new force structure, and we concluded 
then--we created something called the Bottom-Up Review that 
identified the primary mission of preparing for two major 
regional conflicts. And we considered there would be other 
missions, but they would be lesser included cases.
    Today, the assumptions of the Cold War in the 1990s are no 
longer valid. A major portion of the U.S. military today is 
involved in two insurgency operations in Iraq and Afghanistan. 
Therefore, not surprisingly this QDR focused on success in Iraq 
and Afghanistan. I must say if I were the Secretary of Defense 
today I would have done the same thing.
    On the other hand, we do need to consider missions that go 
on 20 years into the future. We do need to be building today 
the forces capable of dealing with these future contingencies.
    Indeed, we believed, the whole panel unanimously believed, 
that a force planning construct to deal with these futures 
would be a powerful lever to shape the Defense Department. And 
because of the absence of this in the QDR, we decided we would 
offer our own judgment as to what those missions should be and 
how they might be met.
    We concluded that the recent additions made to the ground 
forces will need to be sustained for the foreseeable future. We 
concluded that the Air Force has about the right structure 
except for the need to add long-range strike, more long-range 
strike.
    We considered, however, a need, a definite need to increase 
the maritime force to sustain the ability to transit freely in 
the western Pacific. That need is at least as strong as it was 
during the Bottom-Up Review, and therefore we suggested that 
the force, the naval forces postulated in the Bottom-Up Review 
might be a baseline to consider.
    We also noted the Defense Department needs to be prepared 
to assist civil departments in the event of an attack on the 
homeland and the cyber field. And we concluded that a portion 
of the National Guard should be dedicated to homeland security, 
in fact, generally that we needed to rethink the contract with 
the Guard and Reserve forces.
    We observed that a major recapitalization will be required, 
particularly when we consider the wear and tear of our 
equipment during the wars in Iraq and Afghanistan. Now, the 
directive of Secretary Gates for efficiencies in the 
acquisition field is a good start, but we unanimously concluded 
it was not sufficient.
    That is additional topline will be required to meet the 
needs we have laid out. This will be expensive, but deferring 
recapitalization will entail even greater expenses in the 
future.
    We looked specifically at the field of personnel. We all 
believe that the all-volunteer force has been a great success, 
but the dramatic increases in cost in the last few years simply 
cannot be sustained.
    We must seriously address this issue, and the failure to do 
so will lead either to a reduction in force, a reduction in 
benefits, or a compromised all-volunteer force, none of which 
are desirable outcomes.
    To do this we must reconsider longstanding personnel 
practices, considering an extended length of expected service. 
It is in revising the benefits to emphasize cash instead of 
future benefits, to consider a vision in the longstanding up-
and-out policy in the military and to consider a revision of 
TRICARE benefits. These are big issues, and I don't need to 
tell this panel that they are politically sensitive issues.
    We recommended the establishment of a new national 
commission on military personnel, comparable to the Gates 
Commission back in 1970. The charter of this commission would 
be how to implement the changes that we have laid out that need 
to be made in personnel policies.
    We looked specifically at the question of professional 
military education. I must say that I believe that the training 
and education programs in the U.S. military have played a key 
role in making our military the best in the world. It is 
expensive, but it is worth it.
    With that in mind, we recommended a full college program 
for reserves with summer training and a five-year service 
commitment. We recommended expanding the graduate program to 
include military affairs, foreign culture, and language. We 
recommended a program to provide officers with a sabbatical 
year in industry.
    As people read this report some, indeed many, may think 
that we have made a disproportionate emphasis on professional 
military education. And to which I would answer that while our 
military does an excellent job in training for doing the 
current mission, professional military education prepares our 
force for future contingencies.
    We did also look at acquisition. We recommended that we 
clarify the accountability in the acquisition force. Indeed, we 
devote several pages of our report to describing how to go 
about doing that.
    We made a very specific recommendation that the DOD set a 
limit, a limit of five to seven years for delivery of all of 
the new defined and desired programs. Five to seven years is 
not characteristic of what has been the history in the last 
decade.
    We have seen too many programs that have gone on for 10, 
12, 14 years. I have simply observed that a program that has 
gone 10, 12, 14 years is guaranteed to cost too much. It is 
guaranteed to overrun. The programs that we have looked back 
historically that have been successful, the F-15, the F-16, the 
F-117 were all done in a four or five- or six-year timeframe, 
and that is no accident.
    We argued that we should require dual-source competition 
for production programs in all cases where it will provide real 
competition. We observed that there is under way right now an 
acquisition program to provide for the urgent needs in 
Afghanistan.
    We commend that program and suggest that we look to 
institutionalize how that is done because we need a regular 
program for dealing with urgent needs onto the future.
    In the field of planning, we recommend the establishment of 
an independent strategic review panel, that the legislative and 
executive branch would establish in the fall of a presidential 
election such a panel, much as in the same way that you 
established this panel.
    But we would recommend it be done in the fall of a 
presidential election year. That panel would convene in January 
as the new administration took office and would report six 
months later.
    Its focus would be on strategic security issues. With that 
input, the new national security advisor would then prepare a 
National Security Strategy [NSS] involved under the 
directorship of the national security advisor with the 
involvement of the key departments, certainly including the 
Defense Department. This new National Security Strategy plus 
the planning program and budgeting system would replace the QDR 
in our judgment.
    Finally, I would like to thank the Congress and the Defense 
Department for giving the panel such a competent and collegial 
group of people to work with.
    And also I would like to say personally it has been a 
privilege and a pleasure to work with Steve Hadley, my co-
chairman. To the extent our report has reached a consensus and 
has reached significant and important conclusions, I would give 
Steve the primary credit for that. Thank you very much, Mr. 
Chairman.
    [The joint prepared statement of Dr. Perry and Mr. Hadley 
can be found in the Appendix on page 45.]
    Mr. Ortiz. [Presiding.] Thank you so much, and we know that 
we have two very capable outstanding Americans with us today 
testifying before our committee. And I just have maybe a couple 
of questions for Dr. Perry and Mr. Hadley. Thank you for 
returning back to our committee today.
    With the increased activity that we see out of China and 
North Korea in the Asian-Pacific affairs, how did you factor in 
these potential threats into your overall assessment of future 
force structure? And on another note, how do you see the 
services balancing the cost of training and equipment with the 
increasing cost of manpower?
    Dr. Perry. I will take a shot at that then give Steve a 
shot as well. The first and I think most important point I 
would make is that I consider the U.S. military forces today 
capable of handling successfully any military contingency I can 
contemplate in the western Pacific theater.
    Our recommendations for an increase in maritime forces were 
looking primarily to future contingencies, but I do not want to 
leave the suggestion that we are inadequate to deal with the 
present contingencies because I believe the forces are totally 
capable of doing that.
    Steve.
    Mr. Hadley. I would only add that that we obviously need 
to, in this time, use our resources very effectively, to give 
effective capability to our military in a way that is as 
efficiently done in terms of using the taxpayers' money. And we 
propose a number of things. Secretary Gates has proposed a 
number of things to save money in the department.
    Acquisition reform we think will reduce costs. We think the 
overhead initiative Secretary Gates is an important one. We 
think it is important to get on to the increasing cost of the 
all-volunteer force if we are going to preserve that force.
    There are a number of things which we think we can do to 
free funds to go into force structure modernization and 
preserving and sustaining the all-volunteer force.
    It may be that we cannot find enough money within the 
defense budget to do what needs to be done, at which point the 
view of our commission is increases to the top line may be 
required, and I think our guess is probably will be required in 
order to do what we need to do now to be ready for the 
challenges over the next 20 years.
    Dr. Perry. Mr. Chairman, I would like to add one other 
comment to that.
    Mr. Ortiz. Sure, go right ahead.
    Dr. Perry. I was in Korea a week or two after the sinking 
of the South Korean ship, and I discussed in some detail with 
the Korean officials and our military officials there what I 
believe the proper response to that should be.
    I recommended then that the South Koreans take major 
program to increase their anti-submarine warfare capability and 
that U.S. Navy should work cooperatively with them in that.
    And I also strongly recommended that there be a very prompt 
anti-submarine warfare exercise conducted in that part of the 
South Korean naval waters in conjunction with the U.S. Navy. 
Those exercises, indeed, are now under way and I am very happy 
to see that outcome.
    Mr. Ortiz. And I just have another question, short one, and 
then I am going to yield to my good friend from California. In 
the last years, we have had--I can remember when you joined the 
Navy, you stayed in the Navy. When you joined the Air Force, 
you stayed in the Air Force. But now we are beginning to see a 
lot of boots on the ground from the Navy, from the Air Force.
    Was that given a consideration by your commission as to how 
we address that? Because we have problems to where sometimes we 
feel that some of these Navy ships are not manned well, and we 
have to cut corners on maintenance because we have got to put 
some of these Navy personnel on the ground. Was that ever 
considered? Or should it be considered?
    Mr. Hadley. I think it should and I will try on that. I 
think our panel did not discuss what I am about to say 
explicitly. I believe they would agree with it that we think it 
is a good thing that the Navy and the Air Force contributed to 
winning the wars we have in Iraq and Afghanistan.
    But you are quite right. It has taken a toll on the Air 
Force and the Navy and particularly we think prospectively 
looking out 20 years. That is why we think we need to make the 
force structure adjustment in the Navy that we have 
recommended. And that is one of the reasons why we think we 
need a fully modernized force, to recognize that that was the 
right thing to do, but it did exact a toll.
    And so what we have laid out is a strategy to take that 
into account and ensure that the Navy and the Air Force will be 
able to play over the next 20 years the wide spectrum of roles 
we need them to play in order to meet the challenges of the 
21st century.
    Bill.
    Dr. Perry. I think that is well said.
    Mr. Ortiz. The gentleman from California, Mr. McKeon.
    Mr. McKeon. Thank you, Mr. Chairman. Gentlemen, the panel 
recommends that the 1993 Bottom-Up Review should be the 
baseline for our force structure. Please explain why you 
recommend we adopt force structure that was recommended 17 
years ago?
    Dr. Perry. In the focus, particularly on the naval forces, 
we observed that the needs for naval forces in 1993 and that 
the needs today are at least as great as the needs in 1993 and 
the Bottom-Up Review recommended a naval force for that.
    We said the force should be no less than that. And so we 
used that as a baseline. We were not representing that as being 
the last word on what should be considered.
    That for us is the baseline in our consideration. We see 
the needs of a naval presence, a maritime presence, 
particularly in the western Pacific at least as great now as it 
was during the Bottom-Up Review.
    Steve.
    Mr. Hadley. I have nothing really to add to that. I think 
it was a combination of the respect for the process that was 
done then, and as Dr. Perry said, a notion that if that force 
was what we thought was required in what we projected to be a 
fairly benign environment and if that environment has been much 
more active than we anticipated and probably will continue to 
be active over the next 20 years, in some sense we need to at 
least have that force. And that is kind of how we backed into 
it.
    We were not in a position to do the kind of force planning 
the Department of Defense would do, but we thought that we 
could establish that as a threshold and that is how we 
presented it in the report. It least needs to be that force. In 
the case of the Army, the Marine Corps, we endorsed the fact 
that it is actually a larger, slightly larger force. And we 
think that is appropriate.
    Mr. McKeon. So that in 17 years, the world hasn't gotten 
safer and the 346 ships recommended in the Bottom-Up Review 
would be a bottom line, at least needing that many. And I think 
we are looking at now we have, what, 278 and the plan was to go 
to 313, so we are way behind.
    The panel found that the QDR force structure may not be 
sufficient to assure others that the U.S. can meet its treaty 
commitments in the face of China's military capabilities. Can 
you develop this point? Which treaty commitments do you have in 
mind and which Chinese capabilities present the greatest 
challenge to our force structure, and how does this impact our 
allies?
    Dr. Perry. The primary treaty responsibilities of course 
would be in Japan and Korea. And all of our contingency plans 
for dealing with any conflicts involving Korea, for example, 
involve a rapid reinforcement of the forces we have there, 
primarily naval and air buildup.
    Beyond that, we had to be concerned with possible 
contingencies that could arise south of there in Taiwan, the 
Philippines, South China Sea. All of those argue for a strong 
maritime presence in the region.
    Steve.
    Mr. Hadley. I think it is fair to say that our allies in 
the region are nervous about the rise of China. They want us to 
engage China positively, to work with China to the extent we 
can and we are. But they want us to be there, diplomatically, 
economically, and militarily as a hedge, if you will, and also 
because they think that contributes to the strength of our 
diplomacy, which I think our panel would agree with. And there 
has been a lot of press coverage the last day or two of 
Secretary of State Clinton's comments in the region, and I 
thought that was a good approach.
    Dr. Perry. I must say, Mr. McKeon, I do not anticipate any 
military conflict with China, and I think indeed if one were to 
happen it would be a huge failure on diplomacy on the part of 
both countries.
    But I also understand that our allies look to the United 
States for support in that region, and that if we were not to 
provide that support that they would feel obliged to build up 
military forces themselves, which would in turn lead to more 
military forces in China and would lead to an arms race in that 
region which would not only be economically disastrous for 
everybody, but would be from a security point of view, 
lessening our security, not increasing.
    So maintaining a consistently strong military force, 
particularly maritime force in the western Pacific, I think is 
the best way of avoiding conflict and avoiding that kind of an 
arms race.
    Mr. McKeon. Peace through strength. The panel concludes 
that modernization has suffered for a long time because of the 
need to sustain readiness and the cost of current operations. 
However, the modernization is now coming due. What steps should 
the Defense Department take to address the modernization 
problem, and what should be our modernization priorities?
    Dr. Perry. I think Secretary Gates has recognized that the 
top line budget he has, given the expenses in Afghanistan and 
Iraq, are not adequate for sustaining the modernization of the 
force. And that is why he has called for a decrease in 
acquisition costs through efficiencies.
    In my opening statement, I commended him for that move, but 
I also observed I do not believe those efficiencies are likely 
to provide enough funds to deal with all of the modernization 
recapitalization that is required.
    Steve.
    Mr. Hadley. Our report tries to make a number of additional 
suggestions. Secretary Perry talked about the capability you 
can reasonably get in five to seven years. The report mentions 
two other things I would just underscore.
    One is the need in some cases to trade off performance to 
maintain cost and schedule. This is not giving our troops less 
than what they need in terms of performance, but it is to say, 
let us not give our troops more than they need for performance 
at the cost of delivering systems too late and over cost.
    Now, we need to find a way to make technology work, not 
only to ensure our men and women in uniform have the equipment 
they need, but also to use technology to drive down costs. You 
know, we see it in the IT [information technology] industry all 
the time.
    We have got to find a way to make technology not only 
deliver the performance our troops need, but at increasingly 
lower costs so we can do the more than one-for-one replacement 
we are going to need to have a fully modernized, adequate force 
structure.
    Dr. Perry. Mr. McKeon, I would say that of all of the 
recommendations we make in this area, the one that would be 
most substantial in keeping costs down is the recommendation to 
hold procurement time to five to seven years. There is a long 
history of just how much the Defense Department overpays for 
programs that go on 10 to 12 years.
    And the discipline that is needed to keep that from 
happening is to start out from the beginning with the program 
by holding them to this lesser time scale. That forces them to 
make the front-end decisions to keep these costs from blooming.
    Mr. McKeon. And that problem accelerates as technology 
further accelerates. As you are moving down the line, you keep 
wanting to add the latest, latest, latest----
    Dr. Perry. Yes.
    Mr. McKeon [continuing]. And seeking the perfect and never 
quite reach, as you say, the delivery of something that could 
help right now.
    Dr. Perry. Well, I am a strong advocate for the importance 
of technology and giving our military a leverage, a competitive 
advantage over other systems. The question is not whether to 
use technology, it is how to introduce it.
    And if you limit it to five to seven years, that means the 
new technology is introduced in the additional mods. For 
example, the F-16A is followed by a B, a C, a D, an E, instead 
of trying to do all that at the first stage. That is the way we 
think it should be done.
    Mr. McKeon. And never get A delivered.
    Dr. Perry. Yes.
    [Laughter.]
    Mr. Hadley. And the other thing, if I just might add that 
is in the report, that I know the subpanel who worked on this 
feels very strongly, we need to clarify roles and have clear 
authority and accountability within the OSD [Office of the 
Secretary of Defense] but also the service chain, as who is 
responsible for delivering the increment of technology on time 
and at cost.
    It is a muddy picture with lots of layering and lots of 
review without clear lines of authority and accountability, and 
I think that is also at the heart of our recommendations.
    Mr. McKeon. Thank you, and my final question, on page 94 of 
the report, the panel states, ``The budget process and current 
operational requirements are driven by the staff process and 
service priorities most likely shaped by the QDR far more than 
the QDR will now shape processes and drive future budgets and 
program agendas.''
    Is it then fair to say that the panel believes that the 
2010 QDR was budget-driven rather than needs-driven?
    Dr. Perry. I would say rather that it was driven by the 
overriding focus on achieving success in Afghanistan and Iraq. 
That was what was driving the QDR.
    Mr. McKeon. That is what took it out just to the five years 
instead of the----
    Dr. Perry. Yes, and then let me repeat also that had I been 
the Secretary of Defense, I believe I would have done the same 
thing.
    Mr. McKeon. This whole process, we are not trying to 
criticize the Secretary of Defense.
    Dr. Perry. Right.
    Mr. McKeon. We are just trying to get to what our needs and 
how we----
    Dr. Perry. Absolutely.
    Mr. McKeon [continuing]. Get there. Thank you very much.
    The Chairman. [Presiding.] Dr. Snyder, please.
    Dr. Snyder. Thank you, Mr. Chairman. I see Mr. Coffman 
sitting down there and Mr. Boswell over here, and I am reminded 
there are some of our most extensive military experience is on 
the bottom row, and I am going to yield to Mr. Boswell who has 
had more bullet holes and helicopters in Vietnam than most of 
us have had rides on helicopters.
    I yield my five minutes to Mr. Boswell.
    Mr. Boswell. Well, thank you, Mr. Snyder. I appreciate 
that. You may have overstated a little bit. I appreciate the 
panel and what you bring to us today, and thank you very much 
for your work and looking at the force behind you, I appreciate 
it as well. I see General Scales I have known for some time. We 
have a little history together as well.
    I appreciate your comments about the western Pacific. I 
think you are right on. I appreciate that. I am concerned 
about--it is certainly a changing world after--my goodness, you 
have said that very well on your panel. The Iraq-Afghanistan 
situation, what is next? I wonder if your panel gave any 
consideration to the African continent and what might evolve 
there, which I feel a little gut concern about and everything.
    And the reason I am piling it all together for just one 
setting, I have got an amendment I have got to offer down the 
hall in transportation infrastructure momentarily, but the 
reduction in force. It happens.
    It has happened before and what happens in our preparation 
and continuity and experience in the officer ranks and 
particularly the noncommissioned officers, concerns me a little 
bit how we keep that interest there, very important.
    And lastly it would be to do with the--we currently, it 
seems to me like we rely and use reserve components, our Guard 
and reservists as part of the standing force, just a little 
thinking in the deployments and so on.
    And I have got about 3,400 to 3,800 going out of my state 
as we speak. And so, you know, how they are part and parcel--
how do they fit in to this as we look ahead?
    I agree. I questioned at first back when we went all 
voluntary, but I think it works. But it is pretty costly. And I 
am sure you have had some discussions on that, so with those 
things, I would like to hear your comments, and I will have to 
depart, and I hope I can get back. Please.
    Dr. Perry. And I will offer two comments on those very 
important points. And the first is that I believe, and I think 
our whole panel are strong supporters of the all-volunteer 
force. I, like you, was skeptical of it when it was started.
    But I would conclude now it has been a great success. It 
has led us to the best military in the world and that we should 
do everything we can to sustain it, and the report was done in 
that spirit.
    Mr. Boswell. I agree.
    Dr. Perry. Secondly on the very important strategic 
planning issue you raised at the beginning, we apparently had 
neither the time nor the resources for doing a full stage 
strategic review. And indeed, one of the casualties of that is 
not sufficient attention paid to Africa.
    But that is one of the reasons we made a strong 
recommendation that the next time this is done, it be preceded 
by a strategic review panel and that is a very important 
recommendation we made in that regard. And I think it is 
responsive to the point that you were making.
    Steve.
    Mr. Hadley. I would add just two points. Our panel thinks 
we really need to rethink the relationship between the active 
force, the Guard and Reserve, and whether we even need some 
mobilization capability beyond the Guard and Reserve. You know, 
we had a mobilization strategy, and we now really have a force-
in-being strategy. And the question is which role for the Guard 
and Reserve? How much of it is an operational reserve? How much 
is it a strategic reserve? How much should it have an enhanced 
role for the homeland issues?
    All of these need to be rethought because if there are 
missions that can be adequately or better done in the Guard and 
Reserve it is cheaper. And that would take some of the pressure 
off the active force. So this is one of the major agenda items 
for the national commission on military----
    Mr. Boswell. On that point, I appreciate what you have just 
said because, you know, we rely on the Guard as you know and we 
have floods and everything else that takes place, and I think 
this needs to be really carefully looked at and I think that is 
good. Appreciate that.
    Mr. Hadley. Second thing I just want to underscore 
something that Secretary Perry said about the national security 
strategic planning process--sorry.
    The Chairman. Go ahead and finish.
    Mr. Hadley. We think that what the committee tried to 
achieve in the QDR Independent Review Panel can't really get 
done adequately that way, and that the committee's objectives 
can be better met with this national security strategic 
planning process that we describe. Thank you.
    Mr. Boswell. Thank you and yield back.
    The Chairman. Before I call on the gentleman from Virginia, 
Mr. Forbes, Mr. Boswell raises the issue, the history of our 
country has been to increase the size of our military and 
drastically reduce the size of our military, and this has 
happened over centuries.
    And Les Aspin, I remember when he was chairman once upon a 
time ago commented it would be good for the country should 
there be a specific percentage of the Gross Domestic Product 
[GDP] to be assigned to the military to the national security.
    That is not going to happen. But how are we to carry, Mr. 
Boswell's thought a step further, how do we ensure against the 
dips and the peaks of interest in and size of and funding of 
things for national security? Major, major problem facing us.
    Dr. Perry. That is a very important and very fundamental 
question. I would not presume to try to answer it fully, but I 
want to make two points about it. The first is the investment 
we make in professional military education is a huge investment 
for preparing us for the future.
    It is a small cost that allows us when the new contingency 
arises and we need to increase the force, we need be in a new 
mission, it means we are doing it from a stronger educational 
and analytical base at least.
    A second is that we make a more effective use of our Guard 
and Reserve forces. We talked about that in the report but I 
really believe there is some very deep thought of bottoms up 
thinking is needed about the proper contract between our Guard 
and Reserves. They are absolutely a key, I believe, to dealing 
with the issue that you are describing.
    Steve.
    Mr. Hadley. I have nothing to add. I think that is a good 
answer.
    The Chairman. If history serves me correct, and I am sure 
the gentleman behind me may correct me on that, General Scales 
and Dr. Kohn, the golden era of professional military education 
was between the wars, between the First World War and the 
Second World War.
    It was not by design. It was by happenstance, the shrinking 
of the military and those outstanding officers that chose to 
stay. So many of them not only attended war colleges, but they 
taught at war colleges. Thirty-one of the thirty-four Army 
corps commanders in the Second World War taught at one time or 
another in the war college system.
    How do we--what is bound to happen? The ups and downs in 
funding, which I don't like, you don't like, our committee 
doesn't like, but it might come to pass. How do we ensure what 
you just talked about in having another era of the golden age 
of military, professional military education? So that when 
trouble does come, you will have those potential leaders, 
whether they be platoon leaders or corps leaders ready, willing 
and able. How do you do that? How do we recreate what happened 
between the wars by happenstance? How do we do that on purpose?
    Dr. Perry. I believe the answer to that lies in an 
increased emphasis on professional military education. I also 
agree with the point you were making that the officers who have 
actually taught in the war colleges or taught in the academies 
bring a unique background and a unique capability so all of 
those points are important.
    They are all, by the way, discussed in our report where I 
think we pay pretty careful attention to those issues.
    Steve.
    Mr. Hadley. I think we have one, I think this committee 
needs to, as you have for the last ten years, helped show the 
way on professional military education to the department. 
Second, there is a terrific opportunity.
    We have got people coming back from service in Iraq and 
Afghanistan who are tactically superb, but they have learned 
the wide range of skills they need to do the jobs we ask them 
to do in those settings.
    I think they will have a demand for the right kind of 
professional military education, and if we afford it to them, 
it will help keep them in the force and so we don't lose this 
capability.
    And lastly I think this rebalancing between active, Guard, 
Reserve, mobilization beyond Reserve is a way of helping manage 
cost but keeping that capability and talent available to the 
country. And that is what the national commission on military 
personnel needs to address.
    Dr. Perry. Mr. Chairman, besides our splendid academies and 
military universities, we need to make greater use, I think, of 
our regular universities. At Stanford where I teach, we had 
each year seven or eight senior officers come and spend a year 
at Stanford taking courses, meeting with the policy people 
there, teaching courses.
    And I have felt this was so successful that in the last 
year or two I have worked to expand that program and I worked 
at each of the services to send more officers to them. And each 
of services have been very forthcoming in that regard. So in a 
small way we are working at one university to try to increase 
that interaction.
    The Chairman. I noticed that there are two recommendations. 
One is that there be an entrance exam for war colleges. As I 
recall, the history of the German General Staff required an 
extensive examination before they were appointed to that 
position. Am I correct?
    General Scales. Yes, sir. It is true.
    Dr. Perry. General Scales said the answer to that is yes, 
and I am sure he knows.
    The Chairman. And also there is a recommendation that an 
officer must serve as a professor before he or she reached the 
flag rank. Is that correct?
    General Scales. Yes, sir, it is true.
    Dr. Perry. Absolutely.
    The Chairman. That is great. Okay, thank you.
    Mr. Forbes.
    Mr. Forbes. Thank you, Mr. Chairman.
    And I want to echo what everyone has said about just the 
marvel of the great work that you have been able to accomplish. 
I wish we could bottle that up in so many different categories 
throughout Congress. And so I want to take your words and not 
add to them because I know they were well thought out, well-
designed.
    And one of the words that you mention in here is a train 
wreck. To us denotes something that is not just a matter of 
tweaking, but something we better be concerned about. And then 
Mr. Secretary, you made a comment that you said that you do not 
anticipate any military conflict with China.
    And in your report, you guys basically say that--or you 
exactly say, ``The risk we don't anticipate is precisely the 
one most likely to be realized.'' So taking those words and 
focusing just on China and us with the number of ships that we 
have, if you are recommending a Bottom-Up Review number that 
would be about 346 ships as I understand it in our Navy.
    We know the Navy has always talked about a 313 ship number. 
Currently we are at about 283, 285 depending on the day. And 
for the first time we have had admirals sit where you are 
sitting telling us the Chinese have more ships in their Navy 
than we have in our Navy. Their curve is going up; ours is not.
    I would like for you talk about those numbers, am I off on 
those numbers? Am I off on your intent? But secondly, the 
Chairman mentioned these spikes and peaks and valleys we have 
in funding. One of the things we know is that we have to set 
priorities.
    We are looking at the Navy needing more ships, more 
personnel. There is a $28 billion in budget reduction we are 
looking for the Pentagon, $3 billion in shipyard 
infrastructure. They are talking about a billion dollar move of 
a carrier to Mayport, Florida.
    And when I look at that, here is our frustration, we have 
put in statute a requirement that we get a shipbuilding plan 
for Congress to look at. The Department of Defense just refused 
to give us that last year despite the fact we even had a 
congressional inquiry unanimously supported by this committee 
to get it. We had a requirement in statute for an aviation plan 
so we can set those priorities; couldn't get it. We are due a 
China military power report that was due May 1; still haven't 
gotten it.
    When we have admirals or individuals from the Pentagon sit 
where you sit and we ask them to prioritize, they refuse to do 
it. Talk to me about the numbers that I just mentioned, but 
also do you have suggestions of a mechanism that we can use to 
better partner with DOD in trying to get the information we 
need so we can help set these priorities?
    Dr. Perry. I will comment on a few of those points, but I 
will start off my comments by saying in my opinion, the United 
States Navy today is the most powerful Navy in the world, and 
whoever is second is pretty far behind. Having said that, there 
is no reason for complacency.
    First of all, the U.S. Navy as compared to the Chinese Navy 
has a worldwide responsibility. They have the responsibility 
well beyond the western Pacific. And in the Pacific alone, we 
do have to recognize the fact that we are declining in our 
force and the Chinese Navy is increasing in its force.
    So all of those things together lead me to recommend to 
join with the panel in recommending that we work to increase 
the size of our Navy. And the reason for that in my mind has to 
be primarily with the importance of maintaining a strong naval 
force in the western Pacific.
    I would emphasize again that I would not suggest that the 
number we used in the Bottom-Up Review Force is the last word 
on the problem. We wanted to call attention to the problem.
    We wanted to say that the Bottom-Up Review is certainly the 
baseline for us for considering this, but we are calling for a 
new strategic planning review at the time of the next 
presidential election.
    So roughly two years from now there would be another 
strategic planning review and would look in great detail at 
this problem and come up with a force construct appropriate for 
the missions that are described.
    Steve.
    Mr. Hadley. I don't have anything to say. It is a good 
answer.
    Mr. Forbes. Thank you, Mr. Chairman.
    The Chairman. Mr. Taylor, please.
    Mr. Taylor. Again Secretary Perry and Admiral, thank you 
for being with us.
    Mr. Secretary, I have concerns that, going back to the 
fleet, that one of our biggest vulnerabilities is fuel. 
Carriers can go for approximately 15 years without refueling, 
the submarines, some of the newer ones, the life of the 
submarine without refueling.
    But the ships that defend the carriers, DDGs and the 
frigates, the cruisers, they have to refuel every three to five 
days, and particularly in the Far East, the farther you get 
away, the burden cost of fuel, the vulnerability of the oilers.
    I was curious if in your review you looked at that? 
Obviously one solution would be to the greatest extent possible 
going to nuclear-powered surface combatants. I was curious if 
in your calls for a 346-ship Navy if you also took a look at 
what I consider to be that vulnerability?
    Mr. Hadley. We opened the door within our committee to a 
discussion of this issue. We thought about whether in the 
acquisition process, for example, the fuel consumption issue 
should play in some way for all the reasons you suggest. And I 
think a number of our panel members felt very strongly about 
it. We could not come up with a mechanism as to how to take 
into account in terms of the planning.
    And it is, you know, our philosophy was to do what we could 
and where issues remain to try to recommend commissions to 
follow it up. That is an issue I think this committee should 
pursue with the Department. So I would say good question. We 
framed the issue. We could not come up with a recommendation on 
how to deal with it.
    Dr. Perry. I would add to that it is not just an important 
question. It has to do, of course, with more than just the 
vulnerability of our ships to fuel.
    If we think today of gasoline at $3 a gallon at the tank in 
Washington, D.C., when you get that same gas delivered to a 
forward operating base [FOB] in Afghanistan or Iraq, it is $30 
or $300, not counting the lives lost getting the fuel there.
    This is a very, very important issue, and I do not believe 
our panel gave enough depth and attention to it.
    Mr. Taylor. Going back to the mix of the vessels, as you 
know the LCS [littoral combat ship] program has run in late. 
The committee has recently followed Secretary Roughead's lead 
to truncate the DDG-1000 program at three, restart the 51 line. 
A later decision was made to put our Nation's missile defense 
on the DDG-51.
    Did the panel--and I have been in favor of both of those 
moves--I am curious if the panel gave much thought as to those 
moves and whether or not they think how likely we are going in 
the right direction?
    Mr. Hadley. We did not try to review those specific 
decisions that you have described in terms of the DDG and all 
the rest. Clearly one of the concerns that the panel had is 
making sure that we deal with asymmetric threats, missile 
defense, weapons of mass destruction, cyber attacks and all the 
rest. But we did not try to sort of look at specific 
procurement decisions. We tried to set a broader framework.
    Mr. Taylor. Okay. Mr. Chairman, I yield back. Thank you.
    The Chairman. Mr. Kline, please.
    Mr. Kline. Thank you, Mr. Chairman and thank you, 
gentlemen, for being here, and for a really terrific report. I 
think the common thread here in this committee that I have 
heard both in this open hearing, in many conversations is a 
deep disappointment in the QDR, which we feel very strongly and 
I think you touch on that that it was in many ways budget-
driven and not the product that we needed.
    And this is the converse or the flip-side that this is an 
excellent document, and so I want to add my voice to those of 
all my colleagues here in saying well done. You touch on so 
many things, but I wanted to go to two related issues. And it 
is sort of getting at the difference between the QDR and your 
QDR in perspective.
    You recommend, the panel recommended that the Congress and 
the executive create an independent strategic review panel, 
which based on what I am just saying sounds like a fine idea.
    And I would be interested in any comments you have on is it 
a same sort of makeup as your panel? And would it be a 
permanent standing panel or ad hoc? Or just some--you probably 
have addressed it, but I would like to hear what you have to 
say about it.
    And then an extremely important issue that gets to the 
point that General Schoomaker used to call I think the tyranny 
of personnel cost or something like that. When you talk about 
the rising military personnel cost and you call for a new 
national commission on military personnel, which I take it to 
be a sort of one-time, you know, the 1970 Gates Commission 
thing.
    Dr. Perry. Yes.
    Mr. Kline. If you could just address those, too, because 
both of them are getting to some outside expertise that is out 
from under the Department and the Administration.
    Mr. Hadley. We think the QDR did a number of good things, 
and I don't want to be too hard on it.
    Mr. Kline. That is okay, Mr. Hadley, I will be hard enough. 
I just want to get your solution to it.
    Mr. Hadley. But I want to reiterate something, what I said 
before. We thought that what this committee was calling for we 
couldn't really get out of the QDR and the QDR Independent 
Panel process. And that is why really we recommend shutting 
down that QDR process because the strategic out-of-the-box 
look, we don't think you can get there from here.
    And that is why we said let us have a national security 
strategic planning process, whole-of-government, top-down and 
start it with what we have called the Independent Strategic 
Review Panel, which would get started and be formed in the fall 
of an election year, would be able to start the January after a 
presidential election and take six months.
    It would be a group of outsiders appointed by the Congress 
and the President to think out-of-the-box, review the strategic 
situation, suggest what changes need to be made in our National 
Security Strategy and in some sense be the front end to the 
national security strategic planning process we then describe.
    And it would be taken over by the National Security Advisor 
on behalf of the President for the new Presidential 
Administration in its first year.
    We think that is the way to get the unconstrained out-of-
the-box strategic look. Because the challenges we face heavily 
rely on the Defense Department but not just only the Defense 
Department, and that way it will give you this whole-of-
government look that we think.
    So our recommendation is what the committee wants is 
exactly right. We just think that the way we have gone about to 
get doesn't work, and this is a better way to get what the 
committee is looking for.
    Bill.
    Dr. Perry. Several comments, first of all, it is critical 
that this panel be appointed both by the executive and 
legislative branch as was this panel and that it be bipartisan. 
In fact that it be nonpartisan, be created in a bipartisan way. 
We tried to run our panel as a nonpartisan panel, not as a 
bipartisan panel.
    That the timing is critical; it has to be started sooner 
than our panel was started to do the job and that is why we 
suggested the fall of election year.
    This could be a continuous body or it could be appointed 
every four years but I think there is a certain merit to having 
it as an ongoing body. And I think that should be--if the 
Congress decides to move in that direction, I think you should 
consider it as maybe a standing panel.
    Mr. Kline. Okay, thank you, gentlemen. And I guess I am out 
of time, but I hope somebody will explore that idea of the 
personnel commission and in your vision how that would 
function. So I am sorry, I yield back, Mr. Chairman.
    Dr. Perry. And that would be a one-shot committee modeled 
after the Gates Commission dealing with the specific issues 
which we outlined in the report.
    The Chairman. Thank the gentleman.
    The gentlelady from California, Mrs. Davis.
    Mrs. Davis. Thank you, Mr. Chairman.
    And I am going to go ahead and go into some of those issues 
and ask you for some responses. I certainly want to thank you 
all, all the panelists for this extraordinary effort. We 
appreciate it.
    You obviously made a recommendation to reform the military 
personnel system, and one of the focuses of that was to provide 
for longer officer careers, which would allow for more 
education as you mention and career broadening assignments and 
the establishment of a more elite career force where high 
quality officers could serve in leadership positions for longer 
periods of time.
    And the report does acknowledge that there are some 
cultural barriers to doing that and those cultural barriers 
would not lend themselves in your, I think, analysis to a kind 
of incremental approach.
    And I wondered if the panel had a chance to look at one of 
the elements in the Defense Authorization Bill in fiscal year 
2011 was to establish a pilot program to test an alternative 
career track for officers. And it would set guidelines for an 
incremental approach to achieve many of the objectives that you 
cite in your report.
    And I just wondered whether--you seem to feel that using 
this incremental approach would not be the easier way to go, 
and that you felt that you needed to kind of do all of this in 
a more dramatic way perhaps.
    We wondered whether in the authorization there was really a 
knowledge that perhaps service members would need to buy into a 
new strategy over time.
    Dr. Perry. Yes, we believe that the present system when an 
officer might be serving or a noncommissioned officer might be 
serving 20, 25 years is a terrible waste of talent. The reason 
our military is so good is because of the great investments we 
make in training and education.
    Mrs. Davis. Yes.
    Dr. Perry. So once we have trained and educated these 
people, in 20, 25 years they leave, and in fact we push them 
out. That system just has to be wrong.
    People are living longer now. They are living active lives 
longer. They have another 10 or 15, 20 years of good potential 
service available. And many of them, and indeed most of them, 
would like to do that if the system will permit them. So I 
think it is crucial that that part of the system be 
dramatically overhauled.
    And I do not suggest it is going to be easy to do that, but 
I think it is important to do that. Our military today is much 
greater involved with technical and specialties and with 
specialized knowledge where education and training is very 
important.
    And so we need to have a way not only of continuing the 
education and training of our officers, but then keeping them 
long enough to get the benefit of it.
    Steve.
    Mr. Hadley. And we thought incrementalism is fine, but the 
need is so urgent, we thought the way to get visibility was the 
commission, and it would hopefully supplement and empower all 
the things you talked about.
    Mrs. Davis. Okay, I appreciate that. I think Mr. Kline had 
raised the issue and of course that one of personnel, 
increasing costs for personnel per service member is obviously 
a very important one here.
    And part of the difficulty is, I think, that we see that 
there are a number of reasons why that has occurred. Certainly 
benefits, other incentive programs have increased over time due 
to inflation, a need to compete with the private sector. There 
are a lot of reasons why those changes have occurred.
    But it is also true that the Defense budget when we look at 
that suggests that as a percentage of the total Defense 
obligation authority that the military personnel accounts have 
actually been steadily decreasing since 1992 and have been 
under 25 percent of the total Defense obligation for the last 5 
years.
    And so I am wondering do you think that that was something 
that everybody had looked at on the panel? And does it, you 
know, change the calculus in terms of feeling that this is a 
problem because we have more expensive people in the services?
    Or is it something that you felt really needed to be dealt 
with quite as you said, you know, sort of just attack it, the 
problem.
    Mr. Hadley. We included in our report the numbers, which 
suggest it has gotten bigger and if you go forward, it would 
get bigger. And there is also concern that what we need to do 
to maintain the all-volunteer force when the economy starts 
coming back will go up as well. So it was when we say ``train 
wreck is coming,'' it is the projections that really have us 
concerned.
    Mrs. Davis. Thank you.
    The Chairman. Thank the gentlelady.
    Mr. Wittman.
    Mr. Wittman. Thank you, Mr. Chairman. I also want to thank 
the co-chairs of the panel, appreciate all the hard work that 
you put into this. It is obviously a great document, and I 
appreciate all the thought that has gone into it.
    If you look in perspective, I think you bring up some very 
interesting points. If you look at where the future leads us, 
and I like your point about saying that our QDR needs to 
reflect the long term needs of our military and not just that 
shorter-term element.
    And I think that what you point out especially in chapter 
three when you talk about force structure and personnel, and 
you are saying the QDR force structure will not provide 
sufficient capacity to respond to a catastrophe, I think that 
is very, very telling.
    Because as we know, it is as important for us to plan for 
the routine as it is for us to plan for the unexpected. And we 
all know that after the unexpected it is hard to go back and 
say, well, ``We should of, could of, would have.''
    I like that you are looking out and saying listen the QDR's 
function really is to make sure that we are properly planning 
for those future issues that we may have to deal with.
    And I also wanted to get you to elaborate a little bit on 
how you believe we can best do that in planning for a future 
force structure? And you point out that we ought to be using 
the 1993 Bottom-Up Review as a good baseline. And then from 
there looking at what current elements of our current force 
structure should be increased. And I am very interested in 
hearing your thoughts about your efforts to put forth the 
alternative force structure, which I think is very telling when 
you speak about where our Navy needs to be. And we had 
discussions just yesterday about what the force structure needs 
to be with our Navy and your alternative force structure points 
to 346 ships. And we currently have an inventory of 288.
    I was wondering if you could give us a little more context 
to that 1993 baseline and your thoughts about that 346 number 
and what we can do and what we need to do to get there and the 
importance of that effort to get there?
    Dr. Perry. Thank you, Mr. Wittman. I want to emphasize that 
we do not believe we had the time or the resources to do a 
detailed force planning exercise.
    Mr. Wittman. Sure.
    Dr. Perry. And so our recommendations need to be considered 
in two related parts. The first was the recommendation for the 
planning process that should be set up to do this----
    Mr. Wittman. Right.
    Dr. Perry [continuing]. Which would begin two years from 
now, and do it with the right way. In the meantime, we felt 
that our judgment was the ground forces with the recent 
increases were at adequate levels that we ought to go up in the 
naval force we go back up to the Bottom-Up Review. That is a 
planning baseline to start from----
    Mr. Wittman. Right.
    Dr. Perry [continuing]. But we need to reconsider that 
carefully in this two years from now.
    Steve.
    Mr. Hadley. That national security strategic planning 
process our panel felt needs to provide better guidance, not 
only to the Department of Defense but to other agencies 
involved in national security as to threats and priorities so 
that the departments can take those and actually come up with a 
force sizing construct that can drive their internal planning 
process. That has been lacking.
    I want to mention also that that would also drive the 
civilian side. We mention the need for greater civilian 
capability to go overseas with our military to help build civil 
structures in post-conflict and stabilization settings.
    Indeed, we propose a national commission on the building of 
the civil force of the future to find a way to get civilian 
agencies able to deploy with our forces overseas. If we do 
that, then this planning process can also give guidance to how 
to size and prioritize that force as well.
    Mr. Wittman. And I appreciate that. I think those are great 
points, making sure that we understand where the needed 
capabilities must be in the future. And then from our 
standpoint as decision makers here on the Armed Services 
Committee, to make sure that then we know in context how to 
properly make resourcing decisions.
    And I think your point there about and the report states, 
``We cannot reverse the decline of shipbuilding, buy enough 
naval aircraft, recapitalize Army equipment, buy the F-35 
requirement, purchase a new aerial tanker, increase deep strike 
capability and recapitalize the bomber fleet by just saving the 
$10 billion to $15 billion that the Department of Defense hopes 
to save through acquisition reform.''
    And we all agree acquisition reform needs to be there, but 
that proper planning, that strategic planning is really where 
the context of resource decisions need to be made here.
    And I really appreciate you all pointing it out because I 
think that is so critical to this process is knowing that in 
context there if we don't have good planning it makes it almost 
impossible for us as decision makers to do that. So again, I 
thank you so much for that and appreciate your pointing that 
out.
    The Chairman. Gentlelady from Guam, Ms. Bordallo.
    Ms. Bordallo. Thank you very much, Mr. Chairman and 
Secretary Perry and Mr. Hadley. Thank you for coming and 
briefing us today on your evaluation of the QDR.
    My questions today revolve around training and readiness in 
the Pacific theater. Although the QDR discusses the forging of 
relationships to include China in order to have stable Pacific 
theater, it does not discuss any of the hurdles our military 
will face with regards to training and readiness.
    Currently 8,600 Marines and their families are coming to 
Guam due to the 2006 United States-Japan Roadmap for 
Realignment Implementation Plan. However, one of the biggest 
reasons for the move is due to runway encroachment and the 
inability to conduct training in the existing areas.
    Yesterday I received a copy of the final environmental 
impact study, ``On the Move,'' and a major issue still not 
resolved is the proposed Marine firing ranges at Pagat on Guam. 
This is a culturally important area and it needs to be 
approached with cooperation between the island community, the 
local government of Guam and DOD.
    More importantly, this highlights issues that surround all 
areas where we have forces stationed in the Pacific theater. 
And with that said, I would like to know if you agree with the 
assessment concerning training and acquisitions of training 
ranges.
    And secondly should this not be more thoroughly addressed 
in the QDR? Finally, can either of you comment on how we should 
approach the training issue to ensure that our forces in the 
Pacific are properly trained?
    Dr. Perry. I have said before and I repeat again, I believe 
that training is a key to the effectiveness of the U.S. 
military today. I must say that the point you are describing I 
am confident is an important point, but it is not a point which 
our commission reviewed in any detail at all.
    Steve, are you aware of anything we did to shed light on 
that?
    Mr. Hadley. No, it is good question, and we looked at the 
Asia-Pacific in force structure terms. We really did not look 
at it in readiness and training terms, and it is an omission 
and you are right about that.
    And again it is the kind of thing I think the committee 
needs to pursue with the Department. It is something we 
probably should have looked at. We had to pick and choose given 
our time constraints. It is a terribly important issue.
    Ms. Bordallo. I understand it is an issue, you know, that 
is really with Guam and ``On the Move,'' but I just wondered 
how we should we approach acquiring land? You know, it has been 
with imminent domain, which is something that our people of 
Guam do not approve of. And also in the ranges this comes to 
the point where I just brought it up, how do we acquire 
properties for firing ranges?
    Mr. Hadley. Well, you know, from the high-level, look, in 
terms of the process has gone over the last five, six years to 
adjust our force structure in Korea and Japan and the like, I 
think the watch word is to try to do it in a way that is 
acceptable with national governments, with local governments, 
and local populations because we want our troops and our 
training presence to be welcomed, not a source of contention. 
So I think the only way to do that is in this broad, consensual 
way.
    Ms. Bordallo. Well, it is a contentious issue in Guam, and 
I certainly hope we will be able to resolve it.
    Dr. Perry. And I regret we can't give you more detailed 
answers because I fully agree on the emerging importance of 
Guam in our whole strategy in the Pacific, so that is a very 
important question. Thank you.
    Ms. Bordallo. Thank you very much, and I yield back, Mr. 
Chairman.
    The Chairman. Thank the gentlelady.
    Mr. Bartlett.
    Mr. Bartlett. Thank you very much. I would like to read 
briefly from the introduction to your report. ``The natural 
tendency of bureaucracies to plan short-term, operate from the 
top-down, think from existing parameters, and affirm the 
correctness of existing plans and programs of record.'' That is 
exactly what happened to the QDR process.
    ``Instead of unconstrained long-term analysis by planners, 
who were encouraged to challenge preexisting thinking, the QDRs 
became explanations and justifications, often with marginal 
changes of established decisions and plans,'' kind of the 
tedious repetition of the obvious.
    The latest QDR continues the trend of the last 15 years. I 
have three concerns of strategic importance, and I wonder how 
they were reflected in the QDR.
    The first of these is the new Chinese anti-ship missile. 
Some of its capabilities are classified, but I think in the 
public domain it is known that it is a real game changer. You 
can't get within 1,200 miles of it.
    And we have essentially no assured defense against it. If 
it were on a ship, then we couldn't get within 1,200 miles of 
any ship. This is a real game changer. Is this reflected in the 
QDR?
    The second concern I have of strategic importance is 
electromagnetic pulse [EMP]. This is the most asymmetric of all 
warfare potentials, a non-state actor, who had a tramp steamer, 
a Scud missile, and any nuclear weapon detonated above the 
atmosphere could be devastating to our military or to our 
country. How is this reflected in the QDR?
    And the third is our deep strike heavy bombers, I notice 
that the Chinese took out a satellite, and we can take out a 
missile with a missile. This new bomber will fly lower than a 
satellite and slower than a missile.
    And I know it will be stealthy and its cross-sectional area 
will be very small, but radar is also becoming very much more 
capable as are the missiles that might take out the plane. 
These three concerns, I wonder how they are reflected in the 
QDR?
    Dr. Perry. I will comment on two of them. On the deep 
strike heavy bomber, we do recommend an increase, that the Air 
Force move forward with another deep strike and has deep strike 
capability.
    In my opinion, we have such capability already in the B-2, 
and that the diagram should be a follow on to the B-2 and have 
the kind of stealth capabilities that the B-2 has. That is the 
unique capability that the United States has today and one 
which will be very important to be incorporated in any new deep 
strike bomber.
    On the Chinese anti-ship capability, of course the U.S. 
Navy is very much aware of that emerging capability and is--
think I would say in simple and unclassified terms has a 
serious program to try to deal with it.
    I am not suggesting complacency in that area, but I would 
suggest that it is not going to--it need not be a game changer 
if we have appropriate countermeasures.
    Steve, do you want to comment on any of those?
    Mr. Hadley. Just two points, I think this is a priority in 
the QDR. It is one of the six mission sets: deter, defeat 
aggression in anti-access environments. It is the second of our 
four enduring interests: a shared access to sea, airspace and 
cyberspace. It is a function partly of hardware, but partly of 
tactics.
    And one of the things we pointed out in our report is the 
Navy and the Air Force are working on an AirSea Battle concept 
on how they would deal with the challenges presented by exactly 
the kinds of systems you describe in anti-access environments, 
and we applaud this. It requires a hardware solution, but also 
a strategy and tactics solution.
    EMP, we did not address. I don't recall it being 
particularly addressed in the QDR. It is an important area. I 
think it is something we paid attention to in the days of the 
Cold War and have stopped paying attention to now, and it is a 
shortfall and something that needs to be addressed.
    Mr. Bartlett. Thank you, but even more important now than 
it was during the Cold War, and thank you for your recognition 
of that. I yield back, thank you.
    The Chairman. Thank the gentleman.
    Mr. Kissell, the gentleman from North Carolina.
    Mr. Kissell. Thank you, Mr. Chairman and thank you to the 
co-chairmen of this study and to all the panelists that help 
put this together. Looking at a different kind of structure for 
a couple minutes, government structure, you talk about that we 
are still basically operating under the government structure 
from the 1930s and 1940s and how that hampers our ability to 
perhaps define and move forward in better ways.
    For someone who was not in Congress at the time--my first 
term--it would seem like with the government reorganizations 
that took place after 9/11 that we might have accomplished some 
of that.
    So what in particular are we looking at in terms of the 
panel's recommendations that the government structure is not 
good and how perhaps did we not make the changes we should have 
after 9/11?
    Mr. Hadley. I would say two things. One we made a start 
after 9/11, but the environment now--9/11 now it is hard to 
believe is nine years ago and the world has changed, and there 
is more that needs to be done and that is what we try to assess 
here.
    Secondly, there are things the executive branch needs to 
do, and we outline them in some detail in our report. There are 
also things Congress needs to do in terms of looking at its own 
committee structure.
    We say that the executive branch needs to overcome the 
stovepipes, and we need to have the government work in an 
integrated way to achieve national security's challenges. That 
has implications for how Congress is organized as well, in our 
view.
    And therefore one of our recommendations was to reconvene 
the Joint Committee on the Organization of Congress, which was 
established by statute in 1945, resulted in legislation in 1946 
that changed how Congress committee structure organize.
    We think Congress needs to reconvene that committee and 
look at its own organization to support recommendations that we 
make for reorganization in executive branch.
    Mr. Kissell. How would you assess in terms of what you talk 
about civilian structure, jointly with military structure as we 
go into different conflicts? How would you assess or did you 
assess the efforts that are being made in Afghanistan now as a 
model for perhaps doing this in the future or not?
    Dr. Perry. And I approach this problem with some personal 
experience of having been Secretary of Defense in Bosnia, where 
we had I thought and absolutely successful first-rate military 
operation, but the civilian function that needed to be 
performed had great difficulty because the civilian team doing 
them did not have the right training or background or 
experience for doing it.
    And that problem manifests itself in spades in Iraq and 
Afghanistan, and so we called special attention to the 
importance of considering a civilian expeditionary force, a 
force that could along with the military, perform the missions.
    And we are very far behind in the training and resourcing 
to do that. We made some specific recommendations in the report 
about how to do it, but mostly what we did was call attention 
to the importance of doing that, and much more detailed 
thinking needs to be done about how to actually accomplish 
that. But it certainly requires more resources in civilian 
departments now and it requires, in my judgment, that pulling 
together a force capable of doing that expeditionary work and 
training that force with the military.
    Steve.
    Mr. Hadley. We learned some things in Iraq and Afghanistan. 
I think overwhelming we have learned that it is really hard, 
and we still don't do it well, and it requires a change of 
culture in our civilian agencies. It requires a change in the 
personnel system, probably change in legislation.
    It was not designed to be deployable in the way our 
military is, and that is one of the reasons we are relying so 
much on contractors because they are more deployable than our 
civilian agencies and departments.
    We don't know how to do it well. We are not organized for 
it, and that is why we think our recommendation for a national 
commission on building the civil force of the future is so 
important. We have got a lot of work to do on this area.
    Mr. Kissell. Thank you, gentlemen.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much. Mr. Coffman, please.
    Mr. Coffman. Thank you, Mr. Chairman. First of all 
gentlemen, I want to thank you for some extraordinary work here 
and members of the panel.
    And in particular I think the reforming the personnel 
system I think is absolutely important and extending the career 
out to 40 years, as you mention, and allowing people to spend 
more time in specific billets, more time in grade. It may 
result in an operating savings as well.
    But one question I have is that I was in the Army before 
the Marine Corps and I was in the Army at the time where they 
had conscription, and in my view it didn't work, and we had 
folks that didn't want to be there and didn't want to serve and 
yet they were forced to be there.
    And it seems that we have evolved to where the level of 
professionalism at all levels of our military is much higher 
than it used to be. And the notion that we can bring people in 
overnight and train them in short order to meet the needs of 
our national security objectives, I think is unrealistic.
    Yet in the Carter Administration, I think in 1979 or so, 
with the Soviet invasion of Afghanistan reinstituted the 
selective service system that we have now at least in place. 
And I have to ask you, is that necessary to have the selective 
service system today up and running. Is that realistic?
    Dr. Perry. In my judgment, no.
    Mr. Coffman. Yes.
    Dr. Perry. What is necessary though is a restructuring and 
a rethinking of the contract with the Reserve and the Guard 
forces. We need a serious approach on how to make the best use 
of the Reserve and Guard force, but I do not believe a 
selective service system would meet any need which I can 
anticipate.
    Mr. Coffman. Okay.
    Mr. Hadley. I would just add one thing, clearly balance 
between the active Guard and Reserve exactly right. The 
question we asked ourselves is are there some capabilities that 
are in the civilian sector that in a time of crisis the United 
States would want to be able to call on?
    For example, in terms of cyber, we thought about a model 
that you have had some capability in the active force, some 
capability in Guard and Reserve, and maybe in a place like 
Silicon Valley, you would try to have some kind of contract, if 
you will, that could bring people to the fore in the event of a 
national crisis.
    On the civilian side, clearly policemen and other people in 
law enforcement could and were called upon to have a role in 
places like Afghanistan.
    So we have talked about a civilian response corps, people 
who would be contracted with in the private sector that in a 
time of national emergency where we needed skills could come 
forward, have some training and deploy overseas in support of 
our military.
    So it is not the traditional conscription service. It is 
not the traditional Selected Reserve. But there may be a role 
for a mobilization of element beyond the Guard and Reserve. And 
that is one of the things that we think the national commission 
on military personnel needs to address.
    Mr. Coffman. Thank you, gentlemen, but let me be clear that 
right now we have a requirement in statute when the Carter 
Administration reauthorized or reinstituted the Selective 
Service System at least to have all the apparatus up and 
running.
    And we are expending dollars to do that today. And we 
require young men in this country that are age 18 to register. 
In your view, is that necessary at this point in time?
    Dr. Perry. My personal view is no. The question is 
complicated enough that I think that it is a issue which the 
commission, which you talked about, a specific issue that 
should be put forward on the plate of this commission on 
military personnel.
    Mr. Coffman. Well, thank you, Mr. Chairman. I yield back.
    The Chairman. Mr. Critz.
    Mr. Critz. Thank you, Mr. Chairman, and thank you, 
gentlemen, for appearing here today. In the report it talks 
about personnel costs and the rise of personnel entitlements. 
And I am just curious as to your view or the panel's view.
    Is this a snapshot in time that because of the accelerated 
or the conflicts in Iraq and Afghanistan have really driven a 
higher than expected amount of health care and needs of our 
military personnel coming back that this snapshot really is an 
aberration?
    Dr. Perry. I think that has certainly been a contributing 
factor. But I think more generally health care costs are rising 
and have been rising every year, and not just in the military 
of course but in the civilian area as well.
    So I think that is a real problem. But I think the problem 
is more general than that.
    Steve.
    Mr. Hadley. I agree with that.
    Mr. Critz. And then in the report the panel writes that in 
evaluating the QDR force structure that you were hampered by 
the lack of a clearly articulated force planning construct. Can 
you explain your assessment of the construct and why you 
concluded that the construct didn't allow you to measure the 
adequacy of the force structure?
    Mr. Hadley. We thought the QDR was useful in that they did 
a lot of scenario work about contingencies that would arise in 
which our military would have to be engaged. And that is useful 
because it is a different world and there are broad theories of 
threats.
    But it did not then try to make some judgments and give 
clear guidance in a construct that would both drive the sizing 
of the force and permit the Department to explain it to the 
Congress in an effective way.
    And that is why our report says that it was a missed 
opportunity. They did the good spade work, if you will, but 
didn't really draw the consequence into sort of a clear sizing 
force requirement that could give clear guidance to the 
services and explanation to Congress. That is what we think 
they failed to do.
    Mr. Critz. Well, I appreciate that. And of course as the 
newest member of the panel, I saw your recommendation for 
reconvening and looking at the structure of Congress and 
committees.
    And I am just curious what your thoughts are on--obviously 
you think there needs to be a reclassification of who has 
jurisdiction over what. And I would just be curious as a quick 
snapshot on why you came to that conclusion?
    Mr. Hadley. Again, we think the problem in this new world 
is stovepiping. And the need is for all the various agencies of 
the government to work together to help solve national security 
problems that are now bigger than just the military. And that 
the real problem in the government is integration and common 
effort.
    Well, if you are going to have that integration in the 
executive, it raises the question of whether there is enough 
integration in the appropriations and authorization process in 
the Congress.
    And we have suggested the Joint Committee on the 
Organization of Congress. We make it with some trepidation 
because Congress obviously is going to have to address these 
itself. But we suggested that commission look at two things. 
One, establishing a single national security appropriations 
subcommittee for Defense, State, USAID [United States Agency 
for International Development], and the intelligence community. 
And then in parallel just considering whether there is a way to 
get enhanced coordination among and across the Congressional 
authorization committees so as to give more integrated guidance 
to the national security departments and agencies.
    Those are two specific things we thought ought to be looked 
at by this commission.
    Mr. Critz. Thank you. I have no further questions. I yield 
back.
    The Chairman. Gentleman from California, Mr. Hunter.
    Mr. Hunter. Thank you, Mr. Chairman. Gentlemen, thanks for 
being here. Just a quick question that is pretty specific. I am 
going to read really quick from your panel's report, ``During 
the dramatic post-Cold War defense cuts, most dual-sources were 
dropped in favor of sole source contracting, but as defense 
funding has returned and it exceeded levels of supported dual 
sourcing, the contracting strategy has remained sole source.''
    ``Recommendation, OSD should return to a strategy requiring 
dual-source competition for production programs in 
circumstances where this will produce real competition.'' 
Probably that last little phrase is the most important out of 
that whole thing.
    But specifically then, leaving aside the implications for 
fighter force readiness, dependent on a sole source for 95 
percent of U.S. fighter engines for our next fleet of fighters, 
do you think that the F-35 engine is a candidate for that dual-
source procurement requirement that you mention here in your 
recommendations?
    Dr. Perry. Do we think--what is the----
    Mr. Hunter. The F-35 engine, having two competitive engines 
for the F-35. Do we make them? Because this committee for the 
most part supported that. The whole House supported that. And I 
am curious if that goes in line with your recommendations.
    Dr. Perry. I would defer what Steve was saying--from in my 
assessment is that our committee did not specifically look at 
any particular system and try to make that judgment. We made a 
more general judgment.
    The general judgment we were quite unanimous on the 
importance of competition and keeping costs down and in 
particular dual-source is a way of competition. We did not come 
to a specific judgment about any particular system.
    Mr. Hunter. What do you think?
    Mr. Hadley. I think what the committee--we did not address 
that specific issue. I think the issue is is this real 
competition that is going to get prices down? Or is this simply 
a situation of directed procurement?
    Mr. Hunter. Right. I understand. What I am asking for--I 
understand you didn't come to conclusions.
    Mr. Hadley [continuing]. For political and other reasons.
    Mr. Hunter. What are----
    Mr. Hadley. And our view is dual-sourcing ought to be to 
enhance competition and to drive prices down, and the experts 
need to have those criteria and then look at the case by case. 
That would be our answer.
    Mr. Hunter. What do you think about the F-35 dual engine?
    Dr. Perry. When I were the secretary of defense and was 
faced with an issue like that, I would put considerable study 
on it and have a lot of people advising me on it. I have not 
had either that study or people advising me on that issue, so I 
would not--I would hesitate to make a judgment.
    Mr. Hunter. Okay. That kind of follows though. Let me ask 
then because in order for us to make good decisions, in order 
for you to make good decisions, you have to have people telling 
you the truth in an objective way.
    And if the people testifying before us, military leaders 
who live and breathe in the Pentagon, live and breathe in the 
OSD, whose future is dependent on basically whatever 
Administration they are in, do you think that it is it even 
possible for us to get objective recommendations?
    I can cite a specific experience in this committee when a 
gentleman answered a question from the chairman, gave his 
personal opinion about the F-35 engine, and it wasn't about 
acquisition even. It was operational availability.
    I remember when I was in the Marine Corps we had to ground 
every F-18 in the world because one cracked a wing or something 
in 2007. So they all got grounded, every one of them because 
the wings were all made by the same guys. So his answer was--
and he basically got fired. I am not going to mention this 
gentleman's name, but he got fired because that wasn't the 
right answer.
    So if the people we are asking questions of here or 
testifying to us live and breathe in this world and their QDR 
comes out of that world and every other recommendation comes 
out of that world, how can we make sure that we are getting the 
right kind of information that is basically the truth and not 
something that their future career depends on them answering 
the correct way?
    Dr. Perry. I think you have to have a certain amount of 
confidence in the competence and the integrity of the people 
who are working in the issue. I and my staff have a lot of 
confidence, a lot of respect for the secretary and the 
undersecretary who are making those decisions, so I would be 
hesitant to second guess them without looking at the issue 
very, very carefully.
    Mr. Hunter. Do you think that there is any--it is hard for 
someone to be objective to us in testifying when they come out 
of that world?
    Dr. Perry. Having been in that position, I can assure you 
it is a very hard decision to make, and it involves----
    Mr. Hunter. And the reason I am asking is because----
    Dr. Perry [continuing]. Personnel issues.
    Mr. Hunter [continuing]. Your QDR differs greatly with the 
one that----
    Dr. Perry. Yes.
    Mr. Hunter [continuing]. We were given, right?
    Dr. Perry. Right.
    Mr. Hunter. And there are obviously some reasons for that. 
I am just trying to get to those reasons. Thank you, Mr. 
Chairman.
    Dr. Perry. Yes.
    The Chairman. Thank the gentleman.
    Mr. Nye, gentleman from Virginia.
    Mr. Nye. Thank you, Mr. Chairman. I wanted to note a couple 
of things in your report with which I agree strongly. I just 
want to read quickly one sentence from your introduction that 
says, ``Instead of unconstrained long-term analysis by planners 
who were encouraged to challenge pre-existing thinking, the 
QDRs became explanations and justifications often with marginal 
changes of established decisions and plans. This QDR continues 
that trend.''
    I want to talk about a particular decision in the QDR, but 
ask your general thoughts on a larger topic about risk 
assessment. In agreeing with that sentence in the introduction, 
I quite honestly found that the QDR included a very oddly-
placed, one-off sentence that suggested that the Navy ought to 
move a carrier from Norfolk to Mayport, Florida.
    I want to read a couple things that you said about risk 
assessments in your report with which I agree including, ``With 
such large demands, the department needs guidance to prioritize 
risk. A more specific measurable strategic guidance is also 
required to make the force structure and budgetary decisions 
required of the QDR.''
    I continue with your quote, ``Both Congress and the 
Department of Defense must base their respective prioritization 
investment decisions on appropriate risk guidance.''
    And you go further to say in the report, ``Because a 
national security strategy with both proactive and risk 
acceptance guidance does not exist, one cannot clearly assess 
the balance of the Department's programs.''
    We have a difficult job here in trying to assess the 
importance of various projects that we would like to invest 
defense dollars in. And what it comes down to at the end of the 
day is making some trade-offs.
    In fact, just last week when I questioned Under Secretary 
of the Navy, Mr. Work, about the proposal to move a carrier to 
Mayport, Florida, he agreed with me that such a decision which 
carries a price tag in the region of a billion dollars requires 
some serious trade-offs.
    In a time when we are trying to get to 313 ships or perhaps 
more appropriately 346 to meet that risk that is out there, 150 
strike fighters shortfall in investments and shipyards, we have 
got to make some tough decisions about where we invest our 
defense dollars. And the QDR ought to be a guide to help us 
make those types of decisions.
    Given what you said about risk assessment, though, and the 
fact that a GAO [Government Accountability Office] study that I 
asked for and this committee ordered last year which reported 
that the Navy is home porting decision-making approach was 
flawed essentially because it was not based sufficiently enough 
on a specific risk analysis that would help us make a decision 
about whether that billion dollars is better spent on that 
project versus something else.
    Secretary Perry, can you comment on whether you agree that 
a decision of that magnitude in the billion dollar range ought 
to be subject to some kind of specific risk assessment that 
would help us make a decision about how we balance that in the 
trade-off against those other things I mentioned?
    Dr. Perry. Yes.
    Mr. Nye. Okay.
    Mr. Hadley, do you want to add to that?
    Mr. Hadley. Yes, but this panel is really not a good 
vehicle for offering guidance on the kinds of specific issues 
you are talking about in terms of moving the carrier decision 
or the F-35.
    Mr. Nye. Sure.
    Mr. Hadley. So it is just we are at 10,000 feet, and you 
are on a very particular issue. And we just didn't have the 
capacity to get into those detailed issues, as important as 
that issue is.
    Mr. Nye. I understand that. I appreciate you saying that. 
And my question is not designed to ask you to make a judgment 
about that particular project. We have a process for those 
kinds of judgments.
    But my question--what I was trying to get at the heart of, 
and I think Secretary Perry, thank you for your very forthright 
answer on that, is the process with which we make these 
decisions, how difficult it is.
    And how much more helpful it would be to us to have 
specific risk assessments done on projects, especially ones 
that carry that kind of dollar price tag to help us decide 
whether the billion dollars ought to be spent there or perhaps 
on something else.
    And that I think is the nature of the challenge of the QDR 
is trying to establish whether or not this QDR tool is the 
appropriate tool or has been constructed appropriately to 
provide us the advice that we need and guidance we need to make 
those tough decisions about those trade-offs. And so I 
appreciate your answer.
    I just want to note again for the record, we understand it 
is a tough process. These decisions are difficult. This 
committee has actually ordered for the coming year additional 
studies on that particular decision to shed more light on the 
risk assessment that we ought to be looking into to help us 
make a decision about whether that billion dollars is better 
spent on this than something else.
    I have made a strong case that I think we have other 
priorities that are higher. But I think a risk assessment is 
something that is absolutely essential before that type of 
decision can be made.
    Thank you, Mr. Chairman. I yield back.
    The Chairman. Thank the gentleman from Virginia. There 
being no further questions, we certainly thank those co-
chairmen today, Dr. Perry and Dr. Hadley, and their fantastic 
panel, some of whom are seated behind them, as well as the 
staff director that has been very, very helpful.
    And as we move from this day toward the conference with the 
Senate, it will also be very helpful, and of course next year 
as we consider anew the challenges of national security. This 
is serious business, and you have done serious work. And we are 
very grateful for what you have done. Thank you again.
    [Whereupon, at 12:07 p.m., the committee was adjourned.]
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