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






                                     

                         [H.A.S.C. No. 111-181]

 
           THE DEPARTMENT OF DEFENSE'S EFFICIENCY INITIATIVE

                               __________

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                              HEARING HELD

                           SEPTEMBER 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          CATHY McMORRIS RODGERS, Washington
BRAD ELLSWORTH, Indiana              K. MICHAEL CONAWAY, Texas
CAROL SHEA-PORTER, New Hampshire     DOUG LAMBORN, Colorado
JOE COURTNEY, Connecticut            ROB WITTMAN, Virginia
DAVID LOEBSACK, Iowa                 MARY FALLIN, Oklahoma
JOE SESTAK, Pennsylvania             DUNCAN HUNTER, California
GABRIELLE GIFFORDS, Arizona          JOHN C. FLEMING, Louisiana
NIKI TSONGAS, Massachusetts          MIKE COFFMAN, Colorado
GLENN NYE, Virginia                  THOMAS J. ROONEY, Florida
CHELLIE PINGREE, Maine               TODD RUSSELL PLATTS, Pennsylvania
LARRY KISSELL, North Carolina        CHARLES K. DJOU, Hawaii
MARTIN HEINRICH, New Mexico
FRANK M. KRATOVIL, Jr., Maryland
BOBBY BRIGHT, Alabama
SCOTT MURPHY, New York
WILLIAM L. OWENS, New York
JOHN GARAMENDI, California
MARK S. CRITZ, Pennsylvania
LEONARD L. BOSWELL, Iowa
DAN BOREN, Oklahoma
HANK JOHNSON, Georgia
                     Paul Arcangeli, Staff Director
                Andrew Hunter, 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:

Wednesday, September 29, 2010, The Department of Defense's 
  Efficiency Initiative..........................................     1

Appendix:

Wednesday, September 29, 2010....................................    47
                              ----------                              

                     WEDNESDAY, SEPTEMBER 29, 2010
           THE DEPARTMENT OF DEFENSE'S EFFICIENCY INITIATIVE
              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

Carter, Hon. Ashton, Under Secretary of Defense for Acquisition, 
  Technology and Logistics, U.S. Department of Defense...........     6
Cartwright, Gen. James E., USMC, Vice Chairman of the Joint 
  Chiefs of Staff, U.S. Department of Defense....................     9
Lynn, Hon. William J., III, Deputy Secretary of Defense, U.S. 
  Department of Defense..........................................     3

                                APPENDIX

Prepared Statements:

    Carter, Hon. Ashton..........................................    71
    Cartwright, Gen. James E.....................................    76
    Connolly, Hon. Gerald E., a Representative from Virginia.....    81
    Lynn, Hon. William J., III...................................    55
    McKeon, Hon. Howard P. ``Buck''..............................    53
    Skelton, Hon. Ike............................................    51

Documents Submitted for the Record:

    Joint Forces Command Transition Planning Team Nondisclosure 
      Agreement Form.............................................    85
    Legal Analysis by the Department of Defense's Office of 
      General Counsel of the Applicability of Section 2687 of 
      Title 10, United States Code, to the Disestablishment of 
      JFCOM, NII, and BTA........................................    89
    Letter from Linda T. Johnson, Mayor of Suffolk, Virginia, to 
      Hon. Ike Skelton Regarding Disestablishment of USJFCOM, 
      Dated September 24, 2010...................................    96
    Memorandum by Hon. Ashton Carter on Better Buying Power: 
      Mandate for Restoring Affordability and Productivity in 
      Defense Spending, Dated June 28, 2010......................   105
    Memorandum by Hon. Ashton Carter on Better Buying Power: 
      Guidance for Obtaining Greater Efficiency and Productivity 
      in Defense Spending, Dated September 14, 2010..............   111
    Memorandum by Hon. William J. Lynn III Regarding the Policy 
      for Communication with Industry, Dated June 21, 2010.......   129
    Memorandum by Robert Rangel, The Special Assistant to the 
      Secretary of Defense, Regarding the Joint Forces Command 
      (JFCOM) Disestablishment Working Group, Dated September 1, 
      2010.......................................................   132
    Statement for the Record of Stan Soloway, President and CEO, 
      Professional Services Council..............................   134
    Written Testimony of Hon. Robert F. McDonnell, Governor of 
      the Commonwealth of Virginia, Regarding Defense Department 
      Budget Initiatives.........................................   144

Witness Responses to Questions Asked During the Hearing:

    [There were no Questions submitted during the hearing.]

Questions Submitted by Members Post Hearing:

    Mr. Bishop...................................................   179
    Mr. Conaway..................................................   180
    Mr. Forbes...................................................   171
    Mr. Garamendi................................................   170
    Mrs. McMorris Rodgers........................................   180
    Mr. Skelton..................................................   163
    Mr. Thornberry...............................................   168
    Mr. Wittman..................................................   180
           THE DEPARTMENT OF DEFENSE'S EFFICIENCY INITIATIVE

                              ----------                              

                          House of Representatives,
                               Committee on Armed Services,
                     Washington, DC, Wednesday, September 29, 2010.
    The committee met, pursuant to call, at 10:08 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. Good morning. Welcome to the House Armed 
Services Committee hearing on the Department of Defense's 
efficiency initiative. We have with us three distinguished 
witnesses: Deputy Secretary of Defense William J. Lynn, III, 
the Department's chief management officer; Dr. Ashton Carter, 
Under Secretary of Defense for Acquisition, Technology and 
Logistics; and General James E. Cartwright, United States 
Marine Corps, the Vice Chairman of the Joint Chiefs of Staff.
    The topic of the hearing discussed is one of the most 
important we will consider this year, and will be particularly 
important next year, when the committee reviews the President's 
budget request for fiscal year 2012. The topic is the 
Department's effort to wring billions of dollars of efficiency 
out of its operations.
    Let me begin and end this hearing with one clear overriding 
message. I think I speak for the overwhelming majority of our 
committee, regardless of party, when I tell you I do not 
support cutting the defense budget at this time. The national 
security challenges this Nation faces around the world dictate 
that we maintain the recent growth of our ground forces, the 
Army and Marine Corps, we modernize our Air Force, and that we 
grow our Navy. To do this, we must continue to grow the base 
defense budget for some time to come.
    I think I also speak for the committee by saying that we 
all want to eliminate waste within the Department wherever and 
whenever we find it, and I commend the Secretary of Defense and 
his able support team, well represented here today, for making 
hard choices that have too often been avoided.
    Now, as you all know, this committee hasn't agreed on every 
decision made, nor should we, but we do respect the leadership 
being demonstrated by the Department of Defense. The 
Department's efficiency initiative is the most comprehensive 
effort of its kind in almost 20 years. Across the board, the 
committee stands ready to hear the Department's case. In the 
area of acquisition reform, we believe the Department's 
initiatives are very much aligned with the policies this 
committee has advocated for years, and which were recently 
clearly expressed in the report of our Panel on Defense 
Acquisition Reform. In other areas, we look forward to better 
understanding what the Department is proposing and what savings 
will be achieved.
    When it comes to jointness, insourcing, and information 
technology, this committee has longstanding interests and 
concerns that may not align as clearly with the Department's 
proposals. As long as I have served in Congress, this system 
has worked one way: the administration proposes, and the 
Congress disposes. This year and next will be no different.
    So gentlemen, your task today is to persuade us that the 
initiative is not part of an agenda to cut the Defense budget, 
and that it is consistent with this committee's longstanding 
priorities in a number of critical areas.
    I turn to my friend, my colleague, the gentleman from 
California, Buck McKeon.
    [The prepared statement of Mr. Skelton can be found in the 
Appendix on page 51.]

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

    Mr. McKeon. Thank you, Mr. Chairman. Secretary Lynn, 
Secretary Carter, General Cartwright, good morning and welcome 
to each of you. We have been looking forward to your testimony 
on the Department's efficiencies initiative for some time. I 
hope that you will be able to provide members of this committee 
with detailed information regarding the Secretary's proposed 
measures and to allay the concerns that many of us share. As 
elected officials, Members of Congress have a responsibility to 
ensure that U.S. taxpayer dollars are not wasted on 
inefficient, wasteful, or redundant programs.
    I agree with Secretary Gates we must scrutinize Defense 
programs to ensure that we are generating the most bang for the 
buck, and that we must concentrate our limited resources on the 
highest-priority programs.
    Furthermore, I view it as the responsibility of the Armed 
Services Committee to exercise the same discipline on an annual 
basis through our Defense Authorization Act to shift funds from 
poorly performing programs to higher national security 
priorities and promising technologies for the future, such as 
missile defense and means to counter anti-access threats.
    But as with most things, the devil is in the details. 
Unfortunately, although we have requested more information, 
both verbally and in writing, the Department has failed to 
fully respond. My first concern is where we find $20 billion a 
year in cuts in the midst of two wars, without also cutting 
back on required weapons and services needed to meet the 
threats of today and tomorrow.
    Secretary Lynn, you have already announced that at least a 
third of the savings will come from within the force structure 
and modernization accounts, the same accounts the Secretary is 
attempting to grow. We have seen that setting arbitrary targets 
for cost savings, as appears to have happened with insourcing, 
can frequently not yield the expected results. How do we avoid 
those pitfalls here?
    Second, I am extremely concerned that no matter what the 
intentions of the Secretary may be, the Administration and some 
in Congress will not allow the Secretary to keep the savings.
    This summer, the White House supported a teacher bailout 
bill that was funded in part with defense dollars. Once these 
savings from this efficiencies initiative are identified, what 
is to stop them from taking this money also?
    We are already seeing impacts of this summer's cuts. For 
example, some of those funds were intended to rectify an 
overdraft in the Navy's military pay accounts. Once those funds 
were taken, the Navy was forced to take the money from aircraft 
procurement accounts. What is the result? It is going to take 
longer to buy the external fuel tanks our Super Hornets and 
Growlers need and to upgrade training simulators. Even worse, 
it will cost the taxpayers more money to buy those fuel tanks 
because we won't be able to take advantage of a negotiated bulk 
buy. So much for efficiency.
    Secretary Gates appears to share my concern. In August, he 
stated, and I quote, ``My greatest fear is that in economic 
tough times that people will see the Defense budget as the 
place to solve the Nation's deficit problems to find money for 
other parts of the government. I think that would be disastrous 
in the world environment we see today, and what we are likely 
to see in the years to come,'' end quote.
    Third, with respect to acquisition reforms, most of these 
appear to be consistent with congressional direction. I would 
like to learn more about the Department's plans to set cost 
targets for new weapon systems. Congress supports analytical 
tradeoffs between required capabilities, time to the 
warfighter, and costs. However, our requirements must be 
determined by the future threat environment, not simply by our 
budgets.
    The Department will have to convince members of this 
committee that these efforts will not weaken our Nation's 
defense. To that end, we must fully understand the rationale 
behind each decision and potential impact of every cut. Case in 
point: Who within the Department of Defense will be responsible 
for ensuring our commanders in Afghanistan and Iraq have the 
correct number and mix of military forces if the Department 
eliminates the Joint Forces Command?
    Thank you for your willingness to provide this committee 
with the information we require to conduct thorough oversight 
and support the Secretary's efforts to grow our investment 
accounts.
    I yield back. Thank you, Mr. Chairman.
    [The prepared statement of Mr. McKeon can be found in the 
Appendix on page 53.]
    The Chairman. I thank the gentleman. Secretary Lynn, you 
are on.

  STATEMENT OF HON. WILLIAM J. LYNN III, DEPUTY SECRETARY OF 
              DEFENSE, U.S. DEPARTMENT OF DEFENSE

    Secretary Lynn. Thank you very much. Mr. Chairman, 
distinguished members of the committee, thank you for the 
opportunity to appear before you and present testimony and 
discuss the Department's efficiency efforts. What I would like 
to do, if it is acceptable, Mr. Chairman, is enter my complete 
statement into the record, and summarize it briefly for you.
    The Chairman. You may, without objection.
    Secretary Lynn. During a speech in May of this year at the 
Eisenhower Library, Secretary Gates outlined how in order to 
maintain and modernize America's key military capabilities at a 
time of war and fiscal pressure, the Defense Department would 
need to fundamentally change the way it does business. The 
reason is this: to sustain the current military force 
structure, which we must do given the security challenges the 
country faces, requires the equivalent of real budget growth of 
2 to 3 percent. The overall Defense budget, however, is 
projected to rise in real terms by about 1 percent, and the 
Department cannot and should not ask Congress or the American 
taxpayers for more increases unless and until we have done 
everything possible to make the dollars we already have count 
for more.
    Bridging the gap requires culling the Department's massive 
overhead costs and structure, the ``tail,'' and directing them 
to our fighting forces and modernization accounts, the 
``tooth.'' This is not an effort to reduce the defense budget. 
This is about shifting resources and priorities within the 
existing top line. That requires reducing the Department's 
overhead costs by targeting unnecessary excess and duplication 
in the Defense enterprise.
    This effort, moreover, is not just about the budget, it is 
also about operational agility. We need to ensure that the 
Department is operating as efficiently and effectively as 
possible. The Secretary has directed us to take a hard look at 
how the Department is organized, staffed, and operated, how we 
can flatten and streamline the organization, how we can reduce 
executive or flag officer billets and the staff apparatus that 
supports them, how we can shed overlapping commands and 
organizations, and how we can reduce the role and number of 
contractors.
    Since the Secretary's speech in May, DOD [Department of 
Defense] has embarked on a four-track approach toward a more 
effective, efficient, and cost-conscious way of doing business. 
I will briefly touch on our activities in Tracks 1 through 3, 
and then spend a little bit more time on Track 4.
    On Track 1, the Secretary directed that the military 
services find more than $100 billion in overhead savings over 
the next 5 years. The services, however, will be able to keep 
any of the savings they generate to invest in higher-priority 
warfighting and modernization needs. This effort is underway 
now, and we have already begun to review the services' 
submissions. The fiscal 2012 budget will reflect the results 
when it is submitted to Congress in February.
    On Track 2, the Department is seeking ideas, suggestions, 
and proposals regarding efficiencies from outside normal 
channels. We have solicited input from experts, from think 
tanks, from industry, and from the Department's external 
boards. We have also established a DOD suggestion program to 
solicit our employees' ideas. The Department is willing to 
consider any reasonable suggestion to reduce our overhead.
    With regard to Track 3, the Department is conducting a 
broad review of how it is organized and operated in order to 
inform the President's 2012 budget submission. This Track 3 
review focuses on affecting long-term systemic improvements in 
several key areas of DOD operations. Dr. Carter will address 
those in more detail in his opening statement.
    With regard to Track 4, which was announced on August 9th, 
we are addressing several specific areas where the Department 
can take action now to reduce inefficiencies and overhead. 
These steps are intended to jump-start the reform process ahead 
of and separate from the normal programming and budgeting 
cycle.
    In particular, they represent the Secretary's lead effort 
to reduce headquarters and support bureaucracies, military and 
civilian alike, that have swelled to cumbersome proportions, 
grown overreliant on contractors, and become accustomed to 
operating with little consideration of costs. Though all of 
these efforts will result in measurable savings, an equally 
important purpose is to instill a culture of cost-consciousness 
and restraint in the Department, a culture that sets 
priorities, makes real tradeoffs, and separates unrestrained 
appetites from genuine requirements.
    There are eight major initiatives that reduce support 
contractors, headquarters personnel, senior executives, and 
flag and general officers. They also include efforts to reduce 
boards and commissions and to eliminate redundant intelligence 
organizations.
    Finally, Track 4 involves several organizational 
disestablishments. The last decade has seen a growth of new 
offices and organizations, including two new combatant commands 
and five new Defense agencies. The Secretary concluded that the 
Joint Forces Command, the Assistant Secretary of Defense for 
Networks and Information Integration, the Joint Staff's J-6 
Directorate, and the Defense Business Transformation Agency no 
longer effectively satisfy the purposes for which they were 
created. Some missions and tasks that each perform remain 
vital, but can be managed effectively elsewhere. Other 
functions that each perform are either already performed 
elsewhere or are no longer relevant for the operation of the 
Department.
    We are mindful that the recommended actions will have 
economic consequences for displaced employees, their families, 
and their communities. The Department is committed to work with 
the affected communities, and will devote significant attention 
to the challenges employees face during this time of 
transition. We have asked Dr. Clifford Stanley, the Under 
Secretary for Personnel and Readiness, to take direct 
responsibility for this aspect of the Department's planning in 
order to ensure we take the steps necessary to help impacted 
employees with appropriate assistance and support.
    In closing, Mr. Chairman, I understand that some of these 
reforms may be controversial and unwelcome to some people both 
inside and outside the Department. No doubt many of these 
changes will be stressful, indeed wrenching for the 
organizations and employees affected. But I would ask the 
members of this committee and the Congress as a whole to 
consider this reform agenda in terms of our responsibilities as 
leaders to set priorities and move resources from where they 
are needed least to where they belong: America's fighting 
forces, the investment in future capabilities to support those 
forces, and most importantly, the needs of our men and women in 
uniform. This is what Secretary Gates and President Obama are 
proposing, and we urge your strong support.
    Thank you for the opportunity to discuss this initiative, 
and I welcome your questions.
    [The prepared statement of Secretary Lynn can be found in 
the Appendix on page 55.]
    The Chairman. Thank you very much. Before I call on 
Secretary Carter, I ask unanimous consent that Representative 
Connolly sit with us at our hearing and ask questions after all 
members of the committee have had their chance to ask 
questions. And I ask the same of Mr. Scott, Bobby Scott, from 
the great Commonwealth of Virginia, for the same. So I ask 
unanimous consent for both Mr. Connolly and Mr. Scott.
    Without objection, so ordered.
    Secretary Carter.

STATEMENT OF HON. ASHTON CARTER, UNDER SECRETARY OF DEFENSE FOR 
   ACQUISITION, TECHNOLOGY AND LOGISTICS, U.S. DEPARTMENT OF 
                            DEFENSE

    Secretary Carter. Thank you, Mr. Chairman, Ranking Member 
McKeon, distinguished members of the committee. I also thank 
you for the opportunity to join Deputy Secretary Lynn, General 
Cartwright today to discuss Secretary Gates' efficiency 
initiative, and in particular one piece of it for which I have 
responsibility.
    As part of his broad initiative to improve the American 
taxpayers' return on our investment in national defense, 
Secretary Gates and Deputy Secretary Lynn tasked me to improve 
the Department's buying power in the way we acquire critical 
goods and services. Specifically, the portion of the budget 
that I am addressing is that $400 billion of the $700 billion 
which is contracted out for goods and services. The other $300 
billion, just to remind you, we spend within the walls, so to 
speak, of the Department of Defense on the uniformed and 
civilian employees, their salaries, their benefits, and so 
forth, and the buildings and installations within which we 
work. That is $300 of the $700 billion. The other $400 billion 
is spent outside the walls, so to speak, of the institution on 
contracted goods and services, that $400 billion in turn about 
equally divided between the procurement of goods and the 
procurement of services.
    We estimate that by targeting efficiencies in both of these 
areas we can make a significant contribution towards achieving 
the $100 billion redirection of defense budget dollars from 
unproductive to productive purposes sought by Secretary Gates 
and Deputy Secretary Lynn over the next 5 years, a significant 
contribution.
    The Department can only meet this goal, however, if we 
fundamentally change the way we do business. To put it bluntly, 
we cannot support our troops with the capabilities they need 
unless we do so. Our challenge is to sustain a military at war, 
take care of our troops and their families, and invest in new 
capabilities, all in an era when Defense budgets will not be 
growing as rapidly as they were in the years following 9/11;
    Last year we identified savings in the Defense budget by 
canceling unneeded programs, programs that weren't performing, 
that we had enough of, or whose time had passed. We will still 
need to do that, but now we must find savings within programs 
and activities we do need and do want.
    The Department must achieve what economists call 
productivity growth. We must learn, as the way I have put it, 
to do more without more. Productivity growth you see in the 
commercial economy when you go and you buy a computer this year 
and it is a little bit better than last year's and maybe even a 
little bit cheaper, and yet we are too often in the position of 
coming to you every year with exactly the same product and 
explaining to you why it costs more this year than it did last 
year. We would like to see some of that productivity growth 
that we see elsewhere in the economy within the defense 
economy.
    On June 28th, I laid out a mandate to the defense 
acquisition workforce and the defense industry describing how 
the Department could try to achieve better buying power. On 
September 14th, after months of work with the Department's 
senior acquisition professionals, industry leaders, and outside 
experts, I issued specific guidance on how to implement that 
mandate.
    I would like to submit, Mr. Chairman, both the June 28th 
mandate and the September 14th guidance, and the charts which 
accompany them, for the record.
    [The information referred to can be found in the Appendix 
on pages 105 and 111.]
    The Chairman. Without objection.
    Secretary Carter. We are now in implementation mode, taking 
each of the 23 principal items in that plan and putting them 
into practice, the very same teams that compiled them.
    The September 14th guidance contains 23 principal actions 
to improve efficiency organized in five major areas, and I 
would like to just highlight a few of the actions we are taking 
in each of these areas and give some illustrative examples.
    Mr. Chairman, to address the point you raised in your 
opening statement, I think you will see that many of the 
specific actions we are taking are not only consistent with, 
but some were inspired by the work of the subcommittee of this 
committee that deals with acquisition reform. So I think you 
will find a lot of consistency there.
    First, as we begin new programs like the Ohio-class SSBN(X) 
[ballistic missile submarine] replacement, the joint family of 
systems for long-range strike, the Army's Ground Combat 
Vehicle, and even a new Presidential helicopter, we will be 
establishing affordability requirements that have the same 
force as high-priority performance requirements like speed, 
firepower, or bit rate. And Congressman McKeon, to your point, 
the objective is to have the design trades to which you 
referred be those which identify the key design parameters, and 
then be able to plot how the cost of the system varies as those 
parameters are varied, not in order to have less military 
capability but to understand where we can change the design in 
the direction of affordability without in fact compromising 
important military capability. That is the purpose of doing 
those design trades, and that is a discipline we need to have 
and we haven't had enough of.
    We will also insist that our acquisition professionals and 
suppliers plan according to what programs should cost, not 
according to self-fulfilling historical estimates of what they 
will cost, as if nothing can be changed in how we do business. 
We are already using this method to drive down costs in the 
Joint Strike Fighter program, the Department's largest, and the 
backbone of tactical air power for the U.S. and many other 
countries.
    Second, to incentivize productivity and innovation in 
industry, we will strengthen the connection between profit and 
performance in our business practices. Among other things, we 
are exploring ways, through contracting and financing vehicles 
and a pilot superior supplier incentive program, to reward 
contractors who control their costs and demonstrate exemplary 
performance.
    Third, we will remove obstacles to effective competition. 
Last year the Pentagon awarded $55 billion in contracts that 
were supposed to be competitive but for which only one bid was 
received, usually from an incumbent. Yet simple changes in how 
we structure evaluations and work with industry have been shown 
to reduce by 50 percent the incidence of single bids by 
incumbents.
    Additionally, we will promote real competition for 
competition is the single most powerful tool available to the 
Department to drive productivity. We must stop deluding 
ourselves with the idea that directed buys from two designated 
suppliers represents real competition. We are already cutting 
down on directed buys with the Navy's Littoral Combat Ship, 
where we have set in place real competition that will save more 
than a billion dollars in the next 5 years alone, with 
additional savings expected over the life of the LCS program. 
Competition is not always available, but the evidence is clear 
that the government is not availing itself of all possible 
competitive situations.
    Fourth, and this is an area where I think we especially owe 
a debt to the Subcommittee on Acquisition Reform because of its 
focus on this question, we will more aggressively manage the 
over $200 billion we spend annually on services, such as 
information technology and knowledge-based services, facilities 
upkeep, weapons system maintenance, and transportation. When 
most people think of the defense budget they think of ships and 
planes, but more than 50 percent of our contract spending, as I 
noted earlier, is for services. Believe it or not, our 
practices for buying such services are even less effective than 
for buying weapons systems.
    Fifth, we are taking steps to reduce unproductive processes 
and bureaucracy by reducing the number of OSD [Office of the 
Secretary of Defense]-level reviews to those necessary to 
support major investment decisions or to uncover and respond to 
significant program execution issues, eliminating low-value-
added statutory processes, and reducing the volume and cost of 
both internal and congressional reports as appropriate.
    Changing our business practices will take time and require 
the continued close involvement of our industry partners. We 
also need your support, which is essential to the success of 
this endeavor. We have every reason to believe that the 
efficiencies we seek can be realized.
    First, we have established reasonable reduction targets.
    Second, we are focused on specific savings of the kind that 
I described.
    Third, it is reasonable to assume that after an era of 
double-digit budget growth there is fat that has crept in and 
that we can find savings.
    And finally, President Obama, Secretary Gates, Deputy 
Secretary Lynn, you on this committee, both Houses, in fact, of 
Congress, in legislation both last year and this year, have 
shown that you expect it and the American taxpayers expect it. 
The alternative, also worth considering, is unacceptable. 
Broken or canceled programs rather than managed programs, 
budget turbulence, uncertainty for industry, erosion of 
taxpayer confidence in the care with which we spend their money 
on national defense, and of course especially lost capability 
for the warfighter in a dangerous world. So we not only can 
succeed, but we must.
    I thank you, and I look forward to your questions.
    [The prepared statement of Secretary Carter can be found in 
the Appendix on page 71.]
    The Chairman. Thank you, sir. General Cartwright, welcome.

 STATEMENT OF GEN. JAMES E. CARTWRIGHT, USMC, VICE CHAIRMAN OF 
     THE JOINT CHIEFS OF STAFF, U.S. DEPARTMENT OF DEFENSE

    General Cartwright. Thank you, Mr. Chairman, Representative 
McKeon, distinguished members of the committee, and thank you 
for the opportunity to discuss the Department of Defense 
efficiency initiatives.
    A few points of context. We remain a Nation at war, and 
that is not lost on us. Troops are deployed around the world, 
many engaged in combat. We are committed to ensuring these 
troops are properly supported.
    Second, DOD is a bureaucracy that has not fully adapted its 
processes and constructs to the information age, as Dr. Carter 
just described. We must be able to adapt with increased speed 
in order to ensure we remain competitive. In an era of rapidly 
evolving threats, our success depends on our ability to adapt 
quickly.
    Third, DOD is cognizant of the Nation's financial 
situation. We do not expect budgets to grow at the rate they 
grew over the last decade. When developing grand strategy, it 
is the first duty of the strategist to appreciate the financial 
position of his or her nation. We demonstrated this 
appreciation during last year's weapons systems portfolio 
changes and earlier this year in the process to release our 
strategic reviews.
    The Secretary's efficiency initiatives are aimed at seeking 
the same effect in our organizations. These initiatives are not 
a cut, but rather a shift of resources from overhead to the 
warfighter, increasing the tooth-to-tail ratio.
    Regarding the disestablishment of Joint Forces Command, 
JFCOM has helped to accomplish the primary goal for which it 
was established, to drive jointness throughout the military. We 
must continue along the positive vectors regarding joint 
activities as directed in the Goldwater-Nichols legislation. We 
must also improve initiatives to strengthen efforts in the 
interagency and combined arenas. It is our goal to reduce 
unintended redundancies and layering, to more clearly align 
operational responsibilities with service, train, and equip 
functions in order to reduce inefficiencies as forces are 
presented to combatant commands. At all the COCOMs [combatant 
commands] we must consolidate functions where appropriate, and 
where functions are retained, move toward a construct of 
combined joint interagency task force organizations and 
centers. The combined interagency aspects are a critical 
component in establishing baseline capacity and surge 
expectations of the force. As the cyber domain continues to 
grow in importance, the Department will look to ensure lines of 
authority and responsibility are clear and adaptable. We intend 
to focus cyber operations in Cyber Command. We will align 
policy and oversight activities in a strengthened DOD Chief 
Information Officer.
    Finally, we must align cyber requirements and cyber 
acquisition to maximize support to the operational activities. 
Given the expanding role and criticality of information and the 
networks that hold and transmit that information, we need to 
manage DOD systems in the cyber domain as we do any other 
operational system. To ensure our success, IT [information 
technology] systems must have the proper architecture and 
capability to ensure adaptability and innovation.
    Further, our architecture should enable collaboration 
throughout the joint interagency coalition and commercial 
partnerships that we engage in. The free flow of information 
among these players is integral to our strategies. The 
Department's information systems must extend to the tactical 
edge and must work when others do not.
    I look forward to answering your questions. Thank you.
    [The prepared statement of General Cartwright can be found 
in the Appendix on page 76.]
    The Chairman. General, thank you very much. I have spent a 
great deal of time and effort over a period of years pursuing 
jointness. I was in on the ground floor in 1982, an effort that 
was begun by Richard White of Texas. I introduced legislation 
in 1983. My first bill abolished the Joint Chiefs of Staff. 
That is when I found that none of them had a sense of humor. 
But the House passed, on three different occasions, legislation 
to create jointness, and in 1986, with a new chairman in the 
Senate, Barry Goldwater, and the able assistance and leadership 
of Bill Nichols of our committee, a bill was passed into law 
called Goldwater-Nichols, which created, in fact, jointness.
    Now, it took some time for the joint culture to come about, 
but it did. The services saluted and did well, and I to this 
day wish to compliment all those, present and past, who helped 
create the jointness based upon the law that we passed known as 
Goldwater-Nichols.
    So that leads me to my first question, Secretary Lynn, if I 
may. The Joint Forces Command is a subject of elimination. If 
that comes to pass, who within the Department will have as its 
central mission the job to advocate and develop and disseminate 
joint operating concepts, doctrine, and training? Would we be 
throwing away all of the efforts that began with Goldwater-
Nichols should that happen? I am very concerned about where 
that will go, how much thought has gone into that, and will our 
military be better off as a result?
    But answer the first question, Secretary Lynn. Who assumes 
that duty?
    Secretary Lynn. Thank you, Mr. Chairman. We, too, recognize 
the importance of jointness in our training, in our doctrine, 
and in our operations, and appreciate the role you played in 
the 1980s, and Goldwater-Nichols, and the subsequent events. 
And as you indicated, those efforts have been successful in 
changing the whole culture of the Department. The COCOMs 
operate very differently than they did during the first Gulf 
War, when jointness was not adequate. The services operate very 
differently than they did in the 1970s and the 1980s in the 
actions that led to the Goldwater-Nichols legislation. We do 
think that since the Department is in a different place that it 
is possible to eliminate the Joint Forces Command, to eliminate 
this four-star, billion-dollar headquarters, but retain the 
culture of jointness.
    You ask where the leadership will come from. The leadership 
will come from the Joint Staff, the leadership will now come 
from the services and the COCOMs themselves because of the 
efforts of Goldwater-Nichols, because of the work of the Joint 
Forces Command. The joint doctrine, training, and operations 
will continue to be a strong part of the Department.
    The Chairman. Where does it go again?
    Secretary Lynn. As I said, the leadership, in terms of 
training and doctrine, much of it will come from the Joint 
Chiefs and the Joint Staff. But the place that we are in is 
fundamentally different than the one that we were in the 1970s 
and 1980s and into the 1990s. We have a much stronger joint 
culture inside the military departments and the military 
services themselves, and the combatant commands inherently 
operate jointly and have a joint ethos as part of how they 
operate.
    The Chairman. All right. Our committee has asked for a 
range of information on how the Department reached the decision 
to disestablish the Joint Forces Command. Thus far we have not 
received the information. Mr. Secretary, when will the 
information be forthcoming?
    Secretary Lynn. Mr. Chairman, we have provided I think 
briefings to the staff, we have provided an extensive----
    The Chairman. No, no, I am not talking about briefings, I 
am not talking about information, sheets of paper.
    Secretary Lynn. Pieces of paper. We have provided, I think, 
an extensive legal opinion on the relevance of the BRAC [base 
realignment and closure] legislation, we have provided the task 
force memos, and will continue to answer the committee's 
questions and provide the documentation and the material that 
the committee needs. As the task force moves into the 
implementation phase, there will be much more material 
available for the committee.
    The Chairman. Have you provided everything for which we 
have asked?
    Secretary Lynn. I am not sure the committee would agree 
with that. We have been trying to be as responsive to the 
committee's questions as possible, and we are going to continue 
to do so. If there is specific pieces of information that you 
think we need, I am happy to follow up--that you need, I am 
happy to follow up for the record.
    The Chairman. For the record, I would like to receive the 
copy of the memorandum for Vice Chairman of the Joint Chiefs of 
Staff; Director, Cost Assessment and Program Evaluation; 
Subject: Joint Forces Command Disestablishment Working Group. I 
would like to have a copy of that piece of information, please.
    [The information referred to can be found in the Appendix 
on page 132.]
    The Chairman. Mr. McKeon.
    Mr. McKeon. Thank you, Mr. Chairman. As I alluded in my 
opening statement, it is critical that the Department provide 
this committee with as much information as possible about its 
plans to improve efficiencies, where cuts will come from, where 
reinvestment will occur, and the impact of each of those 
changes in terms of current and future operations. This is no 
more true than in the case of the proposed closure of U.S. 
Joint Forces Command. The standup or closure of a combatant 
command deserves close scrutiny. It represents a major 
organizational and functional shift within the Department, and 
a significant change for the workforce.
    To that end, on August 10th, during a briefing to HASC 
staff and Members' staff by Secretary Hale and other senior 
leaders, several documents were requested regarding the closure 
of JFCOM [Joint Forces Command]. By the end of the month, no 
such information had been provided.
    Now, the chairman just asked about some of that. I want to 
be even a little more specific. On August 31st, I, along with 
two of my ranking members, Representative Randy Forbes and 
Representative Rob Wittman, sent a letter to Secretary Gates 
requesting the same information. Nearly a month later, just 
yesterday we finally received a reply.
    I want to thank Secretary Gates for responding, and to 
thank you for any role that you may have played in providing 
additional information. However, not only was the response 
extremely tardy, but it was incomplete. My colleagues and I 
requested the DOD General Counsel's legal counsel about the 
applicability of the BRAC law, a copy of the recommendation and 
analysis provided by senior staff to the Secretary of Defense 
regarding the closure of U.S. JFCOM, any business case analysis 
conducted relating to this initiative, finally, terms of 
reference provided to the task force charged with implementing 
closure of U.S. JFCOM.
    Now, we received the General Counsel's legal opinion and 
the terms of reference for the task force, but not the senior 
staff's analysis, nor any business case analysis.
    Secretary Lynn, will the Department immediately provide the 
committee with the requested materials?
    Secretary Lynn. Mr. McKeon, let me address the business 
case issue because it has come up repeatedly. The decision to 
disestablish or to recommend disestablishment of the Joint 
Forces Command was not based on a business case; it was based 
on a military rationale. It was based on a review of the 
Unified Command Plan and what the central purposes of the Joint 
Forces Command were, the provision of forces, joint training 
and doctrine, joint experimentation. After 30 meetings on those 
subjects with his senior military leaders and his senior 
civilian advisers, the Secretary concluded that those missions 
no longer justified a four-star, billion-dollar command, and he 
so recommended to the President.
    So it was a military rationale that caused the Secretary to 
recommend the disestablishment of the Joint Forces Command, not 
a business case.
    Mr. McKeon. So nothing regarding any business was involved 
in the decision?
    Secretary Lynn. The Secretary looked at the growth of the 
Joint Forces Command. It tripled over the last decade, with no 
fundamental change in its mission. So that caused him to look 
at that military rationale, and we are now engaged in a review 
center by center, function by function as to which centers and 
which functions need to be retained and where they would be 
retained. In that review, the results of which we will provide 
to the committee of course, we are looking at the business 
case----
    Mr. McKeon. May I ask when?
    Secretary Lynn. As we develop the courses of action and the 
recommendations. It will be over the course of the fall.
    Mr. McKeon. I think probably one of the problems the 
committee, or at least myself as a member of the committee are 
having, is the things we have asked for are late in coming or 
incomplete in coming, and we can't seem to get an answer as to 
when we will get those things that we have asked for. And then 
you tell us that you have made decisions, you are moving 
forward like we have no say whatsoever or no way to deal with 
this. And it leaves us somewhat frustrated. I think you can see 
from both the chairman and myself the questions we have. I am 
not saying that we are against this. It is just that we haven't 
seen the rationale or the total--we don't understand totally 
the why and the wherefor. And we still have questions about 
that. And when I asked when or if you will immediately give us 
this information, what is the response? You started talking 
about that it is not a business decision, it was a military 
decision. Okay. So you made no business analysis. Is that what 
I am understanding?
    Secretary Lynn. No. What I am saying is that there was a 
military rationale. I tried in my testimony to summarize that 
rationale. We will try and provide you--I understand you want 
more material on that. We will try and provide that.
    Mr. McKeon. I understand that you made----
    Secretary Lynn. I am trying to say that on the issues of 
the budgets and how much savings there will be, which is I 
think what you mean by a business case, that is being developed 
now. We think we will be able to save a substantial part of 
that billion dollars. We have not developed all of the 
recommendations that lead to the savings. We have developed the 
rationale that caused the Secretary to recommend 
disestablishment. The second phase is then to review which 
pieces stay, which pieces go, and what the net result in terms 
of savings are. When you are saying business case, I think that 
is what you want. I am saying that is underway right now, and 
we will provide it to the committee.
    Mr. McKeon. Okay. So what you said is you made no business 
decision. You think that as time goes on you will look for 
savings, and that is probably what we are talking about when we 
ask for business information on it.
    Secretary Lynn. I am trying, I guess, to understand that is 
where you are going.
    Mr. McKeon. I am not too articulate.
    Secretary Lynn. You are very articulate, I think.
    Mr. McKeon. But some of the things we are asking, let me go 
back then to--well, eventually I guess we will get something 
about the business analysis. But what about the military 
rationale document? Could we get that?
    Secretary Lynn. Well, we think we have answered that 
question in the testimony, in the briefings, in the material we 
have provided, in the legal opinion. But I will go back to the 
Department and see if there is more material or a fuller 
explanation that we can provide if the committee thinks it 
requires it.
    Mr. McKeon. This committee, Mr. Secretary, is the most 
supportive of the military in Congress, the members of this 
committee, and we are not trying to be obstructionists. We are 
supportive of what you are trying to do. We just need to 
understand more fully where you are coming from. There was a 
lot of rationale to set up JFCOM, and now you are saying there 
is a lot of rationale to eliminate it. The chairman asked who 
is going to take over that responsibility of jointness. And you 
said, well, we are in a different place now and I guess we 
don't need it anymore. We just need to understand that more 
completely.
    Let me ask another question. I share the Secretary's 
concern that the growth in the Department's top line is 
insufficient to address the future capabilities required by the 
military. One percent real growth in the defense budget over 
the next 5 years is a net cut for investment and procurement 
accounts. This is not just my view. The independent, bipartisan 
QDR [Quadrennial Defense Review] panel appointed by Congress 
recognized this fact. The co-chairman of that independent 
panel, Bill Perry, the Secretary of Defense under President 
Clinton, and Steve Hadley, the National Security Adviser under 
President George W. Bush, echoed the concerns of many on the 
committee. Their 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. With that in mind, I am fully supportive of efforts 
to identify unnecessary overhead or low-priority programs if we 
can translate that savings into force structure and 
modernization accounts. But we cannot be naive.
    Secretary Lynn, what specific commitments, if any, have you 
or the Secretary received from the administration that they 
will not attempt to harvest this savings for non-defense 
spending, and that they will oppose any attempt by the Congress 
to do so? And secondly, should you be successful in reinvesting 
$100 billion over the next 5 years into force structure and 
modernization accounts, how much more funding will be required 
to see sustained growth of 2 to 3 percent in these accounts? 
How do you propose to achieve this growth?
    Secretary Lynn. Well, answering the last question first, 
Mr. McKeon, the $100 billion number comes from what we think it 
takes to get from the 1 percent top line growth to a 2 to 3 
percent growth in the accounts that you are focused on, the 
force structure and the modernization accounts. That is how 
that calculation was done.
    We have the support of the administration for the budget 
plan that we have presented of 1 percent real growth, and we 
have been trying to get the support of Congress. Of course we 
haven't heard the final bell on that yet.
    I guess I would come back, Mr. McKeon, the challenge here 
is that everyone supports our effort in general, supports 
reform in general, but has problems with each of the particular 
recommendations, such as the Joint Forces Command, to eliminate 
redundancy, to take out layering, to take out headquarters. I 
understand these are tough decisions, but if we don't make 
these tough decisions we will not get that $100 billion.
    Mr. McKeon. Well, you haven't given us any savings yet for 
JFCOM. You said you haven't done a business analysis yet to 
come up with any savings. That was a military decision. So to 
count that in the 100 billion is probably not----
    Secretary Lynn. Well, fair enough. Before we submit the 
budget in fiscal 2012, there will be savings coming from this 
initiative.
    Mr. McKeon. Okay. We are hoping there will be. We haven't 
seen that analysis yet. We are just assuming at this point that 
there will be some savings generated.
    Secretary Lynn. And it is a fair question to get that 
analysis before you judge it.
    Mr. McKeon. And that is what we asked for back in the 
letter, and that is what we would still like to see.
    Thank you, Mr. Secretary.
    The Chairman. As I understand it, you don't know how much 
you would save in efficiency by elimination of that command?
    Secretary Lynn. We don't have the net number yet. We know 
it costs about a billion dollars to operate that command every 
year, and we know we are going to eliminate portions of that, 
the headquarters and some of the other functions, and that will 
save some money. And we will provide that analysis, I think 
what Mr. McKeon called the business case analysis, as we 
proceed this fall.
    The Chairman. As I see it, Mr. Secretary, somebody is going 
to have to ride the shotgun on jointness. I think that is a 
given. The services could very well resort to stovepipe 
activities without that joint doctrine being enforced one way 
or the other. That really worries me.
    Secretary Lynn. I understand. Let me ask General Cartwright 
to comment on that, if I may.
    The Chairman. By the way, Goldwater-Nichols almost didn't 
include your job, General Cartwright, but we got it.
    General Cartwright. I am sincerely appreciative.
    Congressman, you know, as we looked at this activity, I 
tend to be much aligned, and we have had many conversations 
over the years about jointness and the incentives that drive us 
to joint, and we were clearly in need of getting more 
horsepower behind building in jointness to our force when we 
moved to the construct of Joint Forces Command. That was clear, 
and it was clear particularly in the areas of essential 
training, the essential task lists that we work with, which we 
call military essential task lists. These are the things that 
the units use to train their people and certify their people in 
their functionality. But they were doing it to service METLs 
[military essential task lists] rather than to joint.
    So one of the first tasks that we had to have when we stood 
up Joint Forces Command is we had to have sufficient horsepower 
in the command, authority aligned and able to say this is what 
we want you to do. And to develop those joint operating 
concepts, which we worked so hard on for the latter part of the 
1990s, along with the essential task lists necessary to certify 
a unit joint.
    About 3 years ago, we started to transition the 
responsibility to certify those units to the services, because 
those training activities, the essential task lists had been 
developed, and the concepts, and the services were in fact 
demonstrating both through their infrastructure, the training 
ranges, the capabilities, that they could in fact do this and 
would do this and saw the value in it. That was the heart of 
why we needed Joint Forces Command, why we needed that four-
star to actually be there to drive this.
    I am not saying joint and the journey to joint is done, but 
the hard work that we put into building those training 
regimens, building those training ranges, building the 
distributed modeling and simulation that bring these forces 
together and allow us to do our work has by and large been 
accomplished. The question is how do we sustain it? And I agree 
with you, who is responsible? Who gets up every morning worried 
about is this force going to stay joint?
    We are working our way through several courses of action 
that are associated with that. It is going to have to be 
somebody. Somebody has to be accountable for that activity. We 
are working on that. We have several options that we are going 
to develop, and we will provide the committee with the results 
and with those choices and with the analysis that we perform. 
But at the end of the day, I am where you are: somebody has to 
get up every morning believing they are in charge of this.
    The Chairman. That is an excellent answer. However, there 
should have been an answer in place before announcing to 
disband this particular command, don't you think, General? You 
announce you are going to get rid of it and then we will find a 
replacement. Come on.
    General Cartwright. Mr. Chairman, we understand and we 
believe that when we looked at it as the Joint Chiefs and made 
our recommendation to the Secretary that we could in fact draw 
down from a four-star command to some other organizational 
construct. However, in the development of what we are doing, in 
the business case and all of the other elements of this 
activity, when we look at the full range of courses of action, 
status quo is an option. It is an option that we will fully 
investigate as to whether or not it is the option or it is not. 
But we are also looking at a full range from status quo to 
breaking down into agencies, other commands, assumption by 
other commands, divestiture completely. That full range is 
going to be considered as we develop this case and present our 
options to the Secretary. I do not feel because the Secretary 
set an objective of eliminating Joint Forces Command that that 
option is removed from us in consideration.
    Now, quite frankly, we believe that we will be able to in 
fact reduce below a four-star command this activity, but it is 
still on the table.
    The Chairman. Well, I thank you for that. I hope you will 
keep in mind that the services by nature will go back to the 
stovepipe doctrines of the past, and there needs to be a joint 
activity to make this a continued success of jointness.
    Mr. Ortiz.
    Mr. Ortiz. Thank you, Mr. Chairman.
    Secretary Lynn, Secretary Carter, General Cartwright, I 
know that you have huge responsibilities and serious 
obligations, but, as I said before, in the same boat, so do we.
    You know--and I think that the Joint Forces Command--
correct me if I am wrong--came about because of the lessons 
learned during the first Persian Gulf. And the reason that at 
least this Member is a little leery is that we established a 
base in Ingleside, Texas, because of the lessons learned during 
the Persian Gulf, which was mine warfare. That base has since 
been closed, has been moved someplace else at a huge cost 
because where they moved did not have the infrastructure. This 
is why sometimes we are leery as to what is going on, all these 
studies. And, you know, when we want to buy something and we 
know that we need it, the longer that we wait, the more that it 
is going to cost.
    But, you know, Secretary Gates has stated that there will 
be a 10 percent reduction in service contracts for each of the 
next 3 years. And my question is, 10 percent of what? What 
exactly--is everything being considered for the cuts?
    Historically, since I have been here, civilian personnel 
freezes have led to increased contracting out by huge numbers. 
What mechanism is being put into place to ensure that 
contractors will not simply be substituted for civilians? And I 
believe in contracting out when it makes sense, but, in many 
instances, it doesn't make sense.
    And I would like to hear what your overarching plan is, to 
include operational energy as part of your broader review of 
efficiencies, and also to hear what steps DOD is taking now to 
get cutting-edge technologies to the theater to change the 
culture and to reduce our demand for fuel.
    I know I have given you three questions, but--anyone that 
would like to tackle these questions.
    Secretary Lynn. I am going to ask Dr. Carter to address 
your operational energy question. There is quite a lot we are 
doing, and it is within his office. But before I do that, let 
me answer your question on consultants.
    I think Secretary Gates had exactly the same perspective 
that you had, that often when we freeze civilian personnel, as 
has happened in the past, it just causes growth in what we call 
service support contracts. And what I mean by that is basically 
contracts which provide staff augmentation to government 
workers. I am not meaning people who do depot maintenance or do 
functional responsibilities related to warfighting. These are 
staff augmentees.
    And they have grown in the last 10 years by about a factor 
of three. Secretary Gates thinks that growth was largely 
uncontrolled, in some cases perhaps unintended; at least, it 
wasn't centrally directed. The reductions that he is directing, 
the 10 percent per year, is intended to rein that back in to 
try and get some more sense of balance between government 
workers and service support contractors.
    We certainly need both. We cannot operate without 
contractors. But we do think that we have gotten out of balance 
over the last 10 years. And so we are working to restore that 
balance as we go forward and as we look to reduce overhead in 
the Department.
    Let me ask Secretary Carter to address the energy question.
    Secretary Carter. Thank you. Very important question. And I 
am delighted to say that, finally, our director of operational 
energy, Sharon Burke, was confirmed a few months ago. So she is 
in the seat now--a very important role.
    And I will give you a few examples of the kind of problems 
that she is looking at. A few weeks ago, I was at Bagram Air 
Base at the fuel depot, where fuel trucks come in, and we 
basically buy at the gate. We are paying $4.28 a gallon--not 
bad--at the gate of Bagram Air Base for fuel, much of which is 
trucked in through Central Asia through mountain passes and so 
forth. A great example of a logistics effort to decrease the 
cost of operational energy--that is, energy at the operational 
end.
    Down in the Kandahar area, we are doing installation of 
tentage there so you are not air conditioning a tent, which 
anybody could realize is an inefficient way to do business.
    So we have learned a lot about operational energy, and Ms. 
Burke is really pushing that forward.
    May I also take the opportunity--Congressman Ortiz, you 
talked about getting cutting-edge technology to the theater. If 
you read my directive to the acquisition workforce that I 
indicated--that I issued a couple weeks ago and indicated I 
would put in the record, it says that achieving these 
efficiencies described in this memorandum is your second-
highest priority. Your first-highest priority is to support the 
ongoing wars. That is my charge to the acquisition workforce.
    And you see this in the MRAPs [mine resistant ambush 
protected vehicle], in ISR [intelligence, surveillance, and 
reconnaissance], and everything else we are trying to do, make 
sure that people realize it is not just about buying tomorrow's 
weapon system that is efficiently and effectively high-end, but 
also about supporting conflict that is ongoing.
    I just wanted to make that point because I feel very 
strongly about it.
    The Chairman. Thank you.
    Mr. Bartlett.
    Mr. Bartlett. Thank you very much.
    Dr. Parkinson noted that, as the British Navy became 
smaller and smaller, the Admiralty, their equivalent of our 
Pentagon, grew larger and larger. He also noted that an 
organization consumes energy with internal communication. And 
the larger the bureaucracy grows, the more of its energies are 
consumed with internal communications. And he noted that, at 
some point, a different point for different types of 
organizations, they become so large that essentially all of 
their energies are consumed with internal communication and 
nothing gets done outside.
    Our Defense Establishment has not escaped these inherent 
characteristics of bureaucracies, and so it is very important 
that we take a look. And thank you for doing that.
    The question is, is the current suggestion of doing away 
with the Joint Forces Command--which--problem might be solved 
by other means, by the way, that we might need to discuss--is 
it possible that this suggested cure might be worse than the 
disease?
    Because his district is so impacted by this, I would like 
to yield the balance of my time to Mr. Randy Forbes.
    Mr. Forbes. I thank my friend from Maryland.
    And, General Cartwright, I thank you for being here, but I 
am not going to ask you any questions for two reasons. The 
first one is because we have basically seen what this 
Administration does to people in uniform who disagree with 
them.
    But, secondly, Secretary Lynn wasn't completely forthcoming 
when he said that the Department was soliciting ideas from 
people about all of these issues, because what wasn't disclosed 
is you had put a gag order or a nondisclosure agreement on the 
people doing this in the Joint Forces Command, where anybody 
that disagrees with you can't even talk to Members of Congress 
or couldn't be here today to talk about these issues.
    And, Mr. Secretary, I ask you this question this morning: 
Who do you serve? Who do you work for?
    Secretary Carter. Sir, the President and the American 
people, through him.
    Mr. Forbes. If that is the case, then you had made the 
comment that President Obama and Secretary Gates were 
supportive of these reforms. Is it your testimony today that 
President Obama has signed off on the reform proposal to shut 
down the Joint Forces Command?
    Secretary Lynn. No, sir. As we discussed yesterday morning, 
the Secretary made that recommendation----
    Mr. Forbes. So then you misspoke when you said that the 
President and Secretary Gates--this is Secretary Gates's 
proposal.
    And the second thing I would ask you is this: You said to 
the ranking member that it was fair, a fair question, to get 
the analysis before you judge it. If that is the case, did the 
Secretary get the analysis? And if he got the analysis, why in 
the world won't you give it to this committee to look at it?
    And let me just go back and say this. Look, this should be 
a debate, as my friend from Maryland said, about whether we 
should shut down the Joint Forces Command, other efficiencies, 
but we can't have that debate because you have just refused to 
give us the information.
    Some of us may disagree. My friend from South Carolina, my 
friend from Texas, my friend from Florida, they all might 
disagree and think it should be shut down or not. But we can't 
have that debate because you have refused to give us a 
scintilla of evidence.
    You know, the Pentagon has woven a tapestry of silence that 
is deafening to the sounds of liberty itself. The end doesn't 
justify the means.
    Let's just look at some of the facts. You have had 11 years 
of testimony out in the public, of written analysis that we 
could look at for joint forces and jointness and the Joint 
Forces Command, and you have had 90 days of backroom meetings--
and they have all been backroom. And when you talk about 
meetings, it could be just two people talking with each other. 
And you talk about these 30 meetings. But you have refused to 
give us one bit of the evidence.
    And when you come in here, you are blending apples and 
oranges. You say there is no business case, yet it was the 
Business Board recommendation that we all first heard about 
this closure. So the Business Board is making military policy, 
not business decisions.
    And then on the first briefings that you came in, you said 
you didn't know what the cost-savings were. Shouldn't you have 
at least looked at those cost-savings before you made the 
analysis? We all know from BRAC that sometimes you guys come in 
here and tell us all this money we are going to save from 
shutting down facilities and it ends up costing us more money 
rather than saving money.
    And you say it is a philosophical decision, but it is not a 
philosophical decision to the folks who are losing their homes 
right now in Virginia to the $250 million deal that didn't 
close last week because of your decision, to the restaurants 
and businesses that are shutting up because you didn't make 
that decision.
    And my time is out. Mr. Chairman, I will look forward to 
asking some more questions when I get my own time.
    Secretary Lynn. Mr. Chairman, I need to respond to a couple 
of those points.
    The Chairman. Go ahead.
    Secretary Lynn. First, Mr. Forbes, the recommendation the 
Secretary made--and you correctly described it as a 
recommendation to the President. He has had extensive 
discussions with the President about that recommendation and 
all the recommendations he has made. But with regard to the 
disestablishment of the Joint Forces Command, the President has 
not yet made a decision.
    The Secretary's recommendation was not based on the Defense 
Business Board. The Defense Business Board is an independent 
and parallel activity that came to the same conclusion. But the 
Secretary's decision, his recommendation was based on his 
consultation primarily with his military advisors. These were 
not meetings with one or two people in the room. These were 
meetings with the Chairman, with the Vice Chairman, with the 
chiefs, with senior civilian advisors, with the commanders, 
both incoming and outgoing, of the Joint Forces Command.
    With regard to the rationale, this is a two-part exercise. 
The rationale to recommend disestablishment was based not on 
the economics but on the military rationale. And I won't--I 
have gone into that in some detail. I won't repeat it. But I 
know you will have another chance for questions, and we can do 
that then.
    The savings--there is a billion dollars. I am sure we will 
save a substantial part of that billion dollars, and that will 
be the business case. And we will provide that to the committee 
when we have it. We have provided to the committee the military 
rationale for the recommendation for closure.
    As a bottom-line point, Mr. Forbes, I fully understand this 
is a very, very tough decision. It is particularly tough for 
the area around Norfolk. We are going to work very hard to work 
with those people to help that adjustment.
    Mr. Forbes. Mr. Lynn, you have not done that. If you are 
going to work hard with them, you could have at least taken 
their calls from the Governor, you could have at least given 
them some information. And you still stonewall us today. But I 
will ask my questions in just a couple of minutes.
    Secretary Lynn. I met with the Governor, as well as 
yourself, yesterday morning and will continue to do that.
    The Chairman. Mr. Taylor, please.
    Mr. Taylor. Mr. Chairman, with your permission, I am going 
to yield my time to Mr. Nye and claim his time when it is his 
turn.
    Mr. Nye. Thank you, Mr. Taylor, for yielding.
    Thank you, Chairman, for holding this set of hearings.
    Secretary Lynn, you said that this was a military decision, 
not a business case decision, and that this is essentially a 
military, not a civilian, decision. I disagree. I just want to 
say, I agree with my colleague, Congressman Forbes, and with 
Senator Webb, who yesterday said, essentially, this, at the 
end, boils down to a civilian decision, because it is going to 
be made by the President on a recommendation by the Secretary.
    But, just talking about the military side of things, I want 
to read quickly a quote from the former commander at JFCOM, 
Admiral Hal Gehman, who said, ``I disagree with the Secretary 
of Defense's message that jointness in military operations has 
been achieved and the job is done.'' He goes on to say, 
``Gates's decision to close JFCOM is abandoning a decades-long 
effort initiated and supported by multiple Secretaries of 
Defense and Chairmans of the Joint Chief of Staff to ensure 
maximum effectiveness of our Armed Forces.''
    Aside from hearing from General Cartwright yesterday 
morning at a meeting we had and in testimony today, this is the 
only other military expert that we have been able to have 
access to to hear his thoughts on the issue. So I think it is 
fair, at the very minimum, to say that there is some 
disagreement or different points of view on the military side 
here.
    Now, we understand, at some point, we have to come to a 
decision on what to do on this issue. I accept that. But I do 
want to say, I strongly share Chairman Skelton and Ranking 
Member McKeon's skepticism in the secretive nature of the 
discussions that have gone on in the Defense Department on this 
issue, particularly on something that has the kind of impact 
that potentially disestablishing a four-star command could 
have.
    And I have to tell you, I get the feeling that the 
Department doesn't seem to believe that there is a role for 
Congress in this decisionmaking, given the fact that the 
recommendation has already been announced.
    I will concede the point that you--today I think we are 
moving forward, actually--have said you agree that an analysis 
needs to be done. And when I say analysis, I am talking about 
what disestablishing the command or what any other route that 
we might end up taking would cost, how much it would save, what 
the specific effects would be on our military, and how we would 
ensure to carry out those important functions that even the 
Secretary has said he knows JFCOM does. He said there are some 
important functions there that need to be carried out.
    What I am concerned about is the fact that the Secretary 
has made the recommendation before the analysis is done that 
even you have said today is an important part of the 
decisionmaking process on where to go here.
    What I want to ask you is if you will commit to including 
us, not just as a committee--but the Virginia delegation and 
the Governor has made many requests to sit down with the 
Secretary of Defense face to face--if you will make a 
commitment to arrange that meeting, to allow us to have the 
input in this analysis process that you have described before 
implementation would proceed with this proposal.
    Secretary Lynn. Thank you, Mr. Nye.
    As we discussed yesterday morning directly with the 
Governor and yourself and some other members of the delegation, 
we will, indeed, ensure that the Governor and elected members 
of the Virginia delegation have an opportunity to meet with the 
Secretary sometime this fall before final decisions are made on 
implementation. And we will solicit your views and open a--make 
sure we have a channel that the information that you think 
needs to be before the Department before we made that decision 
indeed is before the Department.
    Mr. Nye. Well, I appreciate you saying that, and I 
appreciate your recognition that we should have a role in the 
process. I have to say, I am unhappy with the performance of 
the Department to date in terms of involving us in that 
discussion. I will say, I am happy to note now that you have 
offered to include us more rigorously in the analytics before 
any decision is implemented, and I thank you for that.
    I just want to close by saying--and reminding the other 
members of this committee--and I think you have had an 
opportunity so far to get a little bit of a flavor of, kind of, 
where this committee is on the decisionmaking process here--
reminding the other members of the committee that the proposed 
closure of Joint Forces Command represents, based on a number 
that we have been given by the Department previously, only one-
quarter of 1 percent of the Secretary's plan to realign $100 
billion in defense priorities.
    And, as we provide oversight over the Secretary's plan, we 
will demand strategic cost-benefit analysis of those decisions. 
Because it is our job to provide oversight over the DOD, and it 
is also our job to our constituents back home to ensure that a 
large DOD brush doesn't sweep away thousands of jobs in our 
district without proper justification and without rationale.
    So, with that, Mr. Chairman, I yield back.
    The Chairman. I thank the gentleman.
    Let me say, Mr. Secretary, that I am deeply concerned that 
the years of creating the joint culture and the enforcement 
thereof could go down the river and be lost. And, as long as I 
am chairman, I am going to do my best to make sure that that 
culture stays and that it is enforced.
    It has come at too much effort, not just by Congress, but 
by so many outstanding leaders who wear the uniform. They made 
it happen. And I don't want to see that slip away. And if I 
have any message for you, Mr. Secretary, I hope you understand 
that.
    Secretary Lynn. I do understand it and share the objective, 
Mr. Chairman. As we discussed, we are not sure the Joint Forces 
Command is the right conduit going forward, but appreciate 
there may be differences about that.
    The Chairman. Mr. Forbes, your regular time.
    Mr. Forbes. Thank you, Mr. Chairman.
    First of all, I would like to request unanimous approval to 
submit to the record a statement by the Governor of Virginia, a 
statement by the city of Suffolk, Virginia, and also questions 
that we have requested that be asked by the Department.
    [The information referred to can be found in the Appendix 
on pages 144 and 96.]
    The Chairman. Without objection.
    Mr. Forbes. Mr. Chairman, I also have enormous respect for 
you. And one of the things that frightens me about Secretary 
Lynn's testimony today is he specifically says he didn't 
believe there was any risk of reverting back to the pre-
Goldwater-Nichols Act of jointness. I think there is a huge 
risk.
    You might not be concerned about all of the cost to the 
Commonwealth of Virginia. I don't expect Members here to be 
concerned. But we should be concerned about this: The number-
one news story on the day this was announced in the communist 
Chinese press was the closure of the Joint Forces Command and 
how it was going to help them because their number-one weakness 
when they are working with the Russians has always been 
jointness.
    Secondly, it is coming to a theater near you. If they can 
do this process here and not have any kind of openness and not 
include anybody, they will do it anywhere across the country.
    The third thing is we have just sent a message out to all 
of our partners across America: You better be careful when you 
deal with the Department of Defense, because don't count on 
them being open and having a process. If they just decide they 
are going to close something, they will make that decision and 
get the analysis later.
    And I wanted to go back to what I was talking about, Mr. 
Secretary, with this cloud of lack of transparency, that you 
guys have pulled down the drapes in the Pentagon. Last year--
and I understand why, because we haven't really, as a 
committee, held you accountable to that.
    Last year, you issued a gag order that prohibited any of 
the individuals at the Department of Defense from even talking 
to Members of Congress about the ramifications of some of your 
cuts. We had hearings that were cancelled because people 
couldn't come here and testify. And what did we do about it? 
This committee did nothing.
    When you refused--the requirement you had by law to give us 
a shipbuilding plan so we would know what you were doing with 
building ships, and we asked you in every way we could and you 
just refused to do it, what did we do about it? We didn't do 
anything.
    When you were required by law to give us an aviation plan 
and you just refused to do it and we asked you and asked you 
and asked you and you just failed, we didn't do anything about 
it.
    You have had 11 years of testimony, analysis supporting 
Joint Forces Command. You make 90 days of backroom meetings, 
and you come in here and give us conclusions but no analysis, 
what are we going to do about that? Not a scintilla of 
evidence.
    You wouldn't respond to Members of Congress, both the 
Senate and as Republicans and Democrats. My friend, Congressman 
Scott, has been right with us on asking this. He has had the 
same kind of problems that we have had.
    The Governor of Virginia, you met with him yesterday. You 
went 7 weeks and wouldn't even return his telephone calls to 
just sit down and say, ``What are you doing, and how are you 
doing it?''
    Yesterday, at the so-called meeting that you had with us, 
you wouldn't let the press come in. We asked you to let the 
press come in. You took our telephones away, any recording 
devices. And there wasn't any classified information or 
anything that had executive privileges, but you just don't want 
the public to know some of this information.
    You have issued a gag order to the personnel in Joint 
Forces Command, refusing to let them talk if they have a 
counteropinion to yours. And one of the questions I would have 
for you today is, will you give us a copy, will you give the 
chairman and the ranking member a copy of that order that you 
made them sign, that nondisclosure agreement, today?
    You know, at some point in time, Mr. Chairman, enough is 
enough. We need the analysis, and we need the effects. I think 
this is the time.
    And, Mr. Chairman and Mr. Ranking Member, we so respect 
both of you, but today we will be sending you a letter that is 
going to be signed by Democrats and Republicans, and not just 
people from Virginia, requesting that we have backed up, we 
have drawn a line in the sand, we have said, ``Please give us 
this information''; you have refused. We have backed up again 
and drawn a line in the sand, and you have just refused. We 
have backed up again and drawn a line in the sand, and you have 
refused.
    And, Mr. Chairman, Mr. Ranking Member, we are going to 
request that, if they keep pushing us against this wall, that 
this committee issue a subpoena to them, requiring this 
information be given to us, because I think it is right for the 
American people.
    And, Mr. Lynn, I will just close by saying this: You may 
work for the President, you might work for the Secretary of 
Defense, but you do work for the American people. They are the 
ones that pay your bills. They are the ones that send their 
sons and daughters to fight our wars. And they have a right to 
know this information. And we ought to be able to give them 
this analysis and put it on the table, because, as the chairman 
said, we can't afford to go back.
    And we need, as part of Congress, not to have to come with 
our hat in our hand, pleading for you to give us crumbs of 
information. We ought to be able to come to you and you give us 
the analysis and the information so that we can do the due 
diligence--we have to have an oversight function to protect the 
greatest military the world has ever known.
    And, with that, Mr. Chairman, I yield back the balance of 
my time.
    The Chairman. I thank the gentleman.
    Dr. Snyder.
    Dr. Snyder. Mr. Secretary, do you want to respond to 
anything Mr. Forbes had to say?
    Secretary Lynn. Just a couple of things. Thank you, Mr. 
Snyder.
    One, I think, Mr. Forbes, the one thing we are agreed on, I 
do work for the American people. That is what I said in 
response to your answer, and I hope you weren't implying that I 
said something else.
    Just on a couple of the factual points, we have provided 
the committee with the shipbuilding plan; we have provided the 
committee with an aviation plan. I know you would have--the 
committee would have liked it in the first month or 2 of the 
administration. We didn't have people confirmed. We provided it 
when we built it. There was no plan when you requested it. We 
built it over the course of the first year, and we have 
provided it now to the committee.
    Dr. Snyder. Mr. Chairman, because I always like to hear 
what Mr. Critz has to say, I would like to yield the balance of 
my time to Mr. Critz.
    Mr. Critz. Thank you, Dr. Snyder.
    Thank you, Mr. Chairman.
    You know, obviously, I had some questions that I was going 
to ask, but, after listening to Mr. Forbes's testimony--you 
know, I go back to the briefing that we received that says the 
DOD indicates that, though some analysis was done leading up to 
the decision to eliminate the command, the detailed plan for 
doing so will be developed over the upcoming year.
    And it is frustrating, because if we are working together 
and good decisions are being made, certainly we are going to 
agree on them. But I think I can understand the frustration is 
that, if we are not included in any of these decisions but we 
are the authorizing committee, it sort of gets a little dicey 
as to what do we support, what don't we support, are we working 
together for the American people.
    But quickly, my question would be, you know, going back to 
1993, when President Clinton and Vice President Gore came in, 
they reinvented government, and a lot of civilian Pentagon 
employees were eliminated over that time, and most of that was 
sucked up into contractors. But, during that time, the O&M 
[operation and maintenance] budget stayed pretty consistent 
with the ECI [employment cost index], with inflation. It has 
been those last 10 years, though, that it has been pretty 
extensive, how it has grown.
    So my question to you is, when you are looking at this 
shrinking of the Defense Department, are we shrinking on O&M, 
are we shrinking on procurement? What is, sort of, the split on 
how that is going to be addressed?
    Secretary Lynn. The focus of the Secretary's initiative is 
on what he has described as overhead. Now, much of the overhead 
is in the O&M account, but not all of it. And so we have asked 
the services and all the defense agencies to put forward 
proposals to develop $100 billion in overhead cuts and to shift 
those resources into the warfighting accounts. That will 
probably lead to some restraint in the growth of the O&M 
accounts, but how much I couldn't tell you right now.
    Mr. Critz. So there is really no general idea that 90 
percent of it is coming out of O&M and 10 percent is coming out 
of procurement. There is really no idea.
    Secretary Lynn. The focus is on overhead. We are going to 
evaluate the specific proposals, and then it will fall where it 
does in the budget.
    Mr. Critz. Okay. So when you are looking forward and you 
are looking to cut your budget, where does the Future Combat 
System fall in this debate?
    Secretary Lynn. Well, the Future Combat System is an Army 
modernization system for its fleet of vehicles. The Secretary 
restructured that last year, feeling that it was not focused 
sufficiently on the lessons that we had learned coming out of 
combat in Afghanistan and Iraq, particularly with respect to 
IEDs [improvised explosive devices]. And that is now being 
restructured.
    The lead element of that is a Ground Combat Vehicle, which 
will probably be the first element out of the restructured 
program. And Mr. Carter could go into more detail on that, if 
you would like.
    Mr. Critz. Well, I am--we just saw that the future combat--
or the Ground Combat Vehicle, there is going to be a rebidding. 
So is that part of the savings that we are looking for going 
forward, or what is the plan here?
    Secretary Carter. With respect to the Ground Combat 
Vehicle, which is one of the elements of what used to be Future 
Combat Systems, the RFP [request for proposals] that the Army 
issued several months ago we have pulled back because it did 
not contain the right acquisition strategy.
    I think the intersection of GCV--I am sorry, Ground Combat 
Vehicle--and the efficiencies initiative lies in the area that 
I described earlier, particularly the affordability-as-a-
requirement idea. So, as we look at the Ground Combat Vehicle, 
just like the Navy has done with SSBN(X), as the Army looks at 
the Ground Combat Vehicle, we are looking at each element of 
the design, all the drivers of the design--internal power, the 
number of troops that the vehicle can carry, the hardness of 
the vehicle, gunnery, and so forth--and looking at the way in 
which each of those requirements drives cost, and making sure 
that we are making the right tradeoff--that is, at the point at 
which we are getting a diminishing return of military 
capability for continuing investment, that we cap the 
requirement at that point.
    Doing that for each of the design parameters on the vehicle 
and thereby getting a well-rounded overall design so that the 
vehicle that we put out an RFP [request for proposals] for, for 
the technology development phase, which is our next step, is 
one that the Army is actually going to be able to afford when 
it comes time to buy it. Seven years to first production 
vehicle, then a period of production. You can look out at the 
Army budget at that time and say, what else are they going to 
be doing? They are going to be doing light vehicles, heavy 
vehicles, in addition to this armored vehicle. They have other 
investments to make. And we want to make sure that we are 
building a vehicle that is, in fact, affordable, while also 
having the military capability they want.
    The savings on that will be--you can think of in two 
categories. One is that it may be that the resulting design is 
one that allows us to spend less over the next 5 years than we 
had originally planned. In which case, that is a savings that 
can be part of the $100 billion. But I think, for that 
particular project, the body of the savings will be in the out-
years, when it comes time to design a--or to procure a vehicle 
that is better designed for affordability than would have been 
the case if we had followed the RFP 4 months ago.
    Mr. Taylor. [Presiding.] The chair recognizes the gentleman 
from Texas, Mr. Conaway, for 5 minutes.
    Mr. Conaway. Thank you, Mr. Chairman.
    Gentlemen, thank you for being here this morning.
    I am going to talk about something besides Joint Forces 
Command. My antenna went up when I heard, I guess on August 
9th, that Secretary Gates's scheme was to cut overhead--and 
back office those kinds of things--in order to adjust these 
numbers, and specifically mentioned the Business Transformation 
Agency and NII [networks and information integration], as well, 
as being redundant, inefficient, inexplicably worthless, and on 
the chopping block for this $100 billion nut.
    A couple of questions. Did you come up with $100 billion as 
a goal, or did you build a case from the bottom up, saying, 
``Here are these things,'' and you just got to the $100 
billion?
    How does eliminating all of that back office, particularly 
BTA [the Business Transformation Agency] and others--have you 
look me in the eye with a straight face and tell me you are 
just as committed to getting auditable financial management 
systems in place and audited financial statements for the 
Department of Defense as you were before this happened? Because 
it looks like you have taken the team that was on the field to 
do that and said they weren't going to get there.
    So my question is that--the issue is, one, do you think 
telling the American people--the confidence to the taxpayers 
you mentioned earlier, Mr. Lynn, is helped or hurt by the 
Department of Defense having audited financial statements? In 
other words, is the Department better able to look them in the 
eye and say, ``Your money is being spent the way we think it is 
supposed to be spent''? Or, ``Just trust us''? You know, ``We 
don't need audits. We are the single-largest entity on the face 
of the Earth, from a spending standpoint, and audits are not 
needed. You can just trust us that we will spend this money.''
    So how do you defend the law that none of you will be here 
when it happens, that it is, you know, 2017, that is required 
for the Department of Defense to be audited--none of you guys 
will be here, and so we won't be able to hold your feet to the 
fire or have any kind of a penalty for you because you didn't 
get there. And so the passive-aggressive, you know, ``Yeah, we 
are going to get there; yeah, we are going to get there; but it 
is going to be somebody else's job'' is frustrating to me.
    And then to have you say, ``Well, we really don't need the 
BTA, we don't need a focus on getting the financial statements 
audited''--can you help me understand how you are still going 
to keep it as a top priority for the Department to get audited 
financial statements and, at the same time, not commit 
resources to getting that done?
    Secretary Lynn. There are a couple of questions embedded 
there. Let me--if I could just take the first one, you asked 
where the $100 billion came from. We have discussed that with 
Mr. McKeon. It was a calculation of, what does it take to get 
our warfighting accounts to 2 to 3 percent real growth----
    Mr. Conaway. Well, I would ask you to give me that math 
because I am not following it. But go ahead.
    Secretary Lynn. Okay. I am happy for the record to provide 
you how the math----
    Mr. Conaway. That is fine.
    Secretary Lynn. That is--we can provide you the 
calculation, but that is where the $100 billion came from. It 
wasn't a totaling of proposals. It was a target based on what 
we thought we needed to get warfighting accounts to 2 or 3 
percent, which is what history tells you need to continue 
upgrades, continue supporting training and personnel.
    Mr. Conaway. Okay.
    Secretary Lynn. The bulk of your question, though, was on 
audited financial statements.
    Mr. Conaway. And sustainable systems.
    Secretary Lynn. And sustainable--well, that is where I was 
going, actually.
    Mr. Conaway. Okay.
    Secretary Lynn. The most important piece is not an audit, 
in my mind. The most important piece is the management 
information systems that the audit just provides a test of.
    Mr. Conaway. Right.
    Secretary Lynn. And we are committed to that. It is, as I 
am sure you well understand, given your background, it is 
somewhat different than it is in the private sector. The goal 
here is not providing information to investors. The goal is 
ensuring the taxpayers' money is well spent, that the 
stewardship is there.
    For that reason, we have focused our initial efforts on 
upgrading management information systems that have to do with 
budgetary resources. That is the--we are trying to focus on the 
most important information because, as you indicated, this is a 
mammoth job, and so we want to start with the most important 
piece. And we are continuing to do that. The Comptroller, who 
has the----
    Mr. Conaway. Mr. Hale and I have had this conversation. The 
focus on the data you use, and you are--it is not getting 
there. You are not getting there. So--but go ahead.
    Secretary Lynn. Well, that--if we are not getting there, we 
probably ought to have a discussion, because that is indeed 
what we are trying, and I am sure that is what Mr. Hale told 
you. And as you indicated, Mr. Hale has the lead for this. This 
is the Comptroller's lead. The Business Transformation Agency 
plays a contributory role, in terms of some of the business 
systems.
    It was the Secretary's conclusion not that it would hinder 
audited financial statements, is that the BTA became an added 
layer when Congress added the position of Deputy Chief 
Management Officer, to which the BTA reports, that there was no 
longer a need for a senior official--the DCMO is an Under 
Secretary-level official--and a defense agency.
    So we are going to fold the responsibilities underneath the 
DCMO [Deputy Chief Management Officer] directly, and we think 
we are going to get some overhead savings by combining the 
senior official with the defense agency. And that was the 
conclusion. It was not a rolling back of our commitment to 
audited financial statements.
    Mr. Taylor. All right. The chair recognizes the gentleman 
from New Jersey, Mr. Andrews.
    Mr. Andrews. Thank you, Mr. Chairman.
    Good morning, gentlemen. Thank you for your testimony.
    I think what Secretary Gates has to say is 
characteristically necessary and correct. And I want to be a 
supporter of his in his efforts to bring some rationality to 
this exploding budget. So I appreciate the work you are doing 
on his behalf, and I appreciate his position.
    A little unsolicited advice. As you have heard from Mr. 
Nye's concerns, Mr. Forbes's concerns, you will hear from Mr. 
Scott, anytime we make some kind of reduction or change in this 
budget, it is very difficult to do. You are living that every 
day. I think it is especially important to do so in a way that 
is procedurally defensible in every respect.
    The concern that I would express, having heard from my 
colleagues about this, about the Joint Forces Command is, you 
know, a decision announced August 9th, given the cycle of when 
Congress considers appropriations bills, when it considers 
authorization bills, is unfortunate.
    I think when you are going to make decisions like this, you 
should follow either of two tracks: You should either do it in 
the budget presentation so the normal process can work its 
course. Or you should call for another BRAC, and, imperfect as 
that process is, I think it has gained some credibility.
    So the hard decisions that you have ahead of you I think 
will become more achievable if you follow some sort of regular 
order.
    The second thing I want to chime in on is what my friend 
from Texas, Mr. Conaway, just said. The legislation he and I 
worked on together that the committee unanimously approved, the 
floor nearly unanimously approved, which hopefully will be 
enacted as part of the authorization bill, does place great 
emphasis on these financial audits. And I think that you will 
gain credibility with the public and with the Congress when 
these audits are done. I think it will permit us to discover 
areas where we can, in fact, achieve efficiency without risking 
in any way, shape, or form the security of the country.
    I wanted to ask you your opinion on the following question. 
Any of the three of you would be fine.
    The waste--the major weapons systems bill the President 
signed in May of 2009 was predicated on the premise that--or, 
the GAO [Government Accountability Office] report that we had 
overspent by nearly $300 billion, and I think it was 17 major 
weapons systems.
    What do you think a plausible goal is in terms of reducing 
outlays in future major weapons systems? In other words, if we 
could unscramble the egg, from the GAO report, in theory it 
would have saved about $300 billion. What do you think we will 
gain, in terms of avoiding cost overruns, if we properly 
implement the WASTE TKO (Weapons Acquisition System Reform 
Through Enhancing Technical Knowledge and Oversight) law the 
President signed in 2009?
    Secretary Lynn. It is hard----
    Mr. Taylor. Would the gentleman yield, sir?
    Mr. Andrews. Yes.
    Mr. Taylor. Just hold up, and you are going to get your 
remaining time.
    They have just announced a motion to--a vote on a motion to 
adjourn. I am going to--it is the chair's intention to continue 
the hearing. So those of you who need to go make that vote, do 
so, but we are going to continue the hearing.
    Thank you very much, Mr. Andrews. We will give you back 
that half a minute or so.
    Mr. Andrews. Of course, Mr. Chairman.
    Secretary Lynn. It is hard to set a target other than that 
we should bring in the programs on cost and on budget. I don't 
know--you hate to set a target that I am going to fail by so 
much.
    I think, under Dr. Carter's leadership and with the 
committee's legislative assistance, I think we have put in 
place things that are going to allow us to do that. We are 
putting far more contracts under fixed-price incentive terms 
rather than cost-plus terms, which give a convergence of the 
incentives of both the contractor and the government now to 
bring it in at the price that was originally quoted because we 
are now sharing the risk if we go over.
    Dr. Carter has introduced things that are making schedule a 
key performance parameter, because, indeed, it is loss of 
schedule that is one of the most common causes for cost 
overruns. So we want schedule, not just performance, to be 
important.
    We are trying to--I am happy, Dr. Carter, if you would like 
to expand on those.
    We are trying to put in place the things that will bring 
that GAO number down. The target is to bring it to no cost 
overruns. I understand--I am not naive--that is a very 
ambitious goal, but that is the goal.
    Mr. Andrews. Dr. Carter, would you like to comment?
    Secretary Carter. Just to echo what the Deputy Secretary 
said, it is an edifice we build brick by brick. I will give you 
a few examples of recent bricks.
    The Joint Strike Fighter program, which we had to tell you 
last fall was an aircraft that--in 2002 we had told you it 
would be $50 million per aircraft in 2002 dollars. And our 
current estimate, which was a credible estimate, a so-called 
will-cost estimate, was $92 million per aircraft.
    And I think Secretary Gates, Deputy Secretary Lynn, and I 
look at that number and say, no, we are not going to pay that, 
we shouldn't have--let's see what we can do to get that number 
down. We are working with the performers of the work to do 
that. We are making some progress in that regard.
    And just in that regard, as a result of that progress, I 
think the services have been able to reallocate from money they 
thought they might have to spend on Joint Strike Fighter over 
the next 5 years some $580 million, which is a contribution to 
that $100 billion.
    Another example----
    Mr. Andrews. Yes, it is a good start, yeah.
    Secretary Carter. Another example: the F/A-18 multiyear, on 
a $6 billion contract, now about $5.3 billion because you 
allowed us to procure those aircraft on a multiyear basis; $600 
million over the FYDP [Future Years Defense Program] that will 
not have to be spent and can be reallocated from that.
    Essentially, the overhead at the plants that make the F/A-
18 as a consequence of them not being able to plan on a 
multiyear basis, that overhead can be plowed into warfighting 
accounts--just exactly the principle that Secretary Lynn has 
been talking about, and Secretary Gates----
    Mr. Taylor. The gentleman from Virginia, Mr. Wittman.
    Mr. Wittman. Thank you. Thank you, Mr. Chairman.
    Gentlemen, thank you for joining us.
    I want to jump right in, since my time is limited, and talk 
about the decisionmaking between the recommendation to close 
Joint Forces Command.
    First of all, I think there is a tremendous lack of 
transparency there. It took us over 7 weeks to get a response 
back from the Secretary. Ranking Member Forbes, Ranking Member 
McKeon, and myself requested that. And when we got the letter 
back, it just restated the initial decision and had in there a 
justification as to why this didn't fall under BRAC. And I 
noticed using the term ``disestablish'' JFCOM, rather than 
``close'' JFCOM. I noted a parsing of terms.
    It seems like, to me, that as we look at this process, 
first of all, we were told, ``Well, this is an efficiency 
effort. We are going to be looking at this to look at where we 
can obtain efficiencies.'' But we are told that there was no 
efficiency analysis or cost analysis about closing JFCOM; that 
is yet to come.
    And then we were said, ``Well, really, it wasn't a business 
decision. It was really a military decision.'' So when we 
asked, ``Well, tell us the strategic analysis behind that,'' we 
were told, ``Well, we are in the process of doing that. We have 
some operational documents out there that talk about how 
jointness is going to be continued, but, strategically, we 
haven't figured out who is going to do this job, how it is 
going to be done. So none of those details have been put 
together.''
    And then we said, ``Well, let us understand a little bit, 
then, about the process.'' And you said, ``Well, we had over 30 
meetings.'' And we said, ``Well, it would be nice to know what 
happened in those 30 meetings.'' It is amazing to me how 30 
meetings can take place at the Pentagon, there isn't a single 
note, there isn't a single proceedings anywhere about those 
meetings that you can divulge to us. Boy, I tell you, I would 
love to know a little bit more about how those meetings take 
place there and how you can have no proceedings there, nothing 
that we can get our hands on to understand what goes on there.
    So you can understand why we are a little bit frustrated by 
the lack of transparency, the lack of understanding about a 
decision of this magnitude and, as the chairman so rightfully 
pointed out, the effort that went into providing a framework 
for jointness and a decision of this magnitude without the 
transparency, without this body understanding--and, Secretary 
Lynn, you lectured us on the responsibilities of a leader.
    I would say that your responsibility as a leader is to 
provide that information so that we, as a Congress, can do our 
duty and our duty to the people that have elected us to make 
sure we understand the decisions, understand the implications 
to this Nation of those decisions. So I appreciate that 
lecture. I would say that the responsibility cuts both ways and 
that the Pentagon also has a responsibility back to the 
Congress, to divulge back to us clearly how that decision was 
made, what the underlying information is there.
    And my question boils down to this. It seems like this 
process is wrought with inconsistencies, is wrought with lack 
of information being disclosed to us. Even at one point, when a 
meeting was had, Christine Fox said that this was a 
philosophical decision. So we are going from it is an 
efficiency effort; no, it is a military decision; no, it is a 
philosophical decision, without any transparency to understand 
exactly what is going on.
    And my question is this: I want to know historically about 
how these decisions are made. Can you tell me other instances 
where decisions are made of this magnitude where you do the 
analysis afterwards, where you do a post-decision analysis 
instead of a pre-decision analysis? Can you tell me when that 
focus has been, in the past, on saying we will do the analysis 
after we make a decision or after we make a recommendation?
    Secretary Lynn. Mr. Wittman, I appreciate the fact that you 
and other members of the delegation feel that we should have 
gotten you more information, we should have gotten it to you 
faster. As I discussed with Congressman Nye, going forward--we 
met with the Governor yesterday morning, with yourself and some 
of the other Members. We will ensure, as I discussed, that the 
Governor and those same Members get the opportunity to meet 
directly with the Secretary. We will seek your input----
    Mr. Wittman. Mr. Secretary, with all due respect, that is 
not the question I asked. The question I asked was, can you 
tell me when in the past decisions have been made like this, 
with the lack of analysis prior to the decision and without 
that being able to be divulged?
    Secretary Lynn. I was addressing some of the preamble that 
you had before that, but let me jump to your question.
    The Secretary made his decision with enormous input from 
the military and the civilian advisors that he had. As we have 
had discussed, his reasoning here was on: What is the military 
purpose for this command, and is it still valid today?
    The conclusion he came to, based on the advice he received, 
was: No, the purpose had been served in some cases, could be 
accomplished by other organizations in other cases, and was 
duplicative in cases such as force provisioning, and the Joint 
Forces Command wasn't needed in that role.
    For those reasons--and he received a lot of input to that 
decision from his advisors in the meetings that you correctly 
summarized--he made his decision.
    As we have discussed with other members of the committee, 
once he has made that decision, the question then is, how much 
of the billion dollars would be saved? And that is a decision 
by what would be retained and what would not. We are not going 
to eliminate every component of the Joint Forces Command, nor 
are we going to keep every component. We are going to go 
through a thorough analysis, which we will share with you, as I 
discussed with Congressman Nye, as to what needs to be kept and 
what needs to go. At the end of that process, we will have the 
complete case that you desire.
    Mr. Taylor. The gentlewoman from California is recognized, 
Mrs. Davis, 5 minutes.
    Mrs. Davis. Thank you very much, Mr. Chairman.
    I appreciate your all being here. This is difficult, very 
difficult. And I certainly understand the concerns of my 
colleagues.
    I wanted to shift for a second in the more personnel-
health-care arena, because we are talking about jointness on 
the one hand. And in the House defense authorization, there is 
a provision that would create a permissive authority to 
establish a unified medical command.
    Given that the Center for Naval Analyses predicts that such 
a move would save approximately $294 million a year, we 
actually were surprised that the Department opposed strongly 
that section of the bill. And it is also true, of course, that 
there haven't--I don't think any of the politically appointed 
positions have been filled within Health Affairs.
    So I am just wondering what objection to the unified 
medical command you have and that you have encountered. You 
know, what is the, I think, considerable pushback to reject the 
House proposal that we think would save significant savings?
    Secretary Lynn. This is--as the congresswoman knows, this 
is a long-running debate over a command versus an agency and 
how we treat our health care.
    I actually think that we ought to have, as the Secretary 
has indicated, a completely open mind. That second track I 
indicated was outside input. I think we should consider all 
possibilities as we look at overhead savings. Although we have 
had questions about it in the past, I would assert to you that 
we should take a look. In the new fiscal circumstances we face, 
we should look anew at that proposal.
    Mrs. Davis. Is there any sense--can you give us any idea 
what kind of management structure, in fact, you might be 
thinking about that would be quite different from what we have 
today?
    Secretary Lynn. We don't have--I don't have any proposals 
to discuss in terms of changing the military--the medical 
management structure for the Department, at this point.
    Mrs. Davis. Okay. I think a lot of issues have been raised 
about other commands or other installations that might be--you 
might be thinking about closing. Is there anything else that 
you might share with us of other commands, at this point?
    Secretary Lynn. I mean, I think the Secretary has said as 
part of his direction to the services that, if they think there 
needs to be changes in installations, they should suggest that 
in their submissions. But we have not gotten to the point that 
we would request a BRAC. That would be just input. So what we 
are--we are not to a point of looking at closing bases or 
installations, at this point.
    Mrs. Davis. Okay. Thank you.
    Let me just turn, then, to an important personnel issue 
that affects the men and women across our country and, 
certainly, across the globe. And recognizing the strides that 
have been made in MWR [morale welfare and recreation] and, 
certainly, in family support assistance programs and Military 
OneSource, as we are looking to efficiencies, what would you 
say--how would you articulate the efficiencies in family policy 
that are being envisioned right now? And how are these 
efficiency studies going to impact our policies as it relates 
to the men and women and their families that are serving today?
    Secretary Lynn. I think the Secretary would be interested 
in any proposals where we could deliver the same services to 
our military families in a more efficient way. I do not think 
he would look favorably on proposals that would reduce the 
support to families, at this point. It is not quite part of the 
direct warfighting, but I think the Secretary believes it is 
equally important.
    And that would not be, I think, the avenue that the 
Secretary is looking to go down. He is more interested in the 
things, frankly, we have been discussing: delayering, 
eliminating headquarters, reducing bureaucracy. I think in 
terms of benefits for military families, that is not the 
direction he is looking to, in terms of making shifts in 
resources.
    Mrs. Davis. Uh-huh. I appreciate that because, as you know, 
we really are in unchartered territories, as our men and women 
return. And I don't think we really have quite got our heads 
around what that is going to mean. I appreciate it.
    And very, very quickly, I mean, people have raised the 
issues of insourcing, outsourcing. And I think one of the 
things that I am hearing out in the San Diego community is a 
concern from businesses that a number of their positions and 
their people, highly qualified people--they use the word 
``poaching,'' that the military is essentially, you know, 
finding them--it is not that hard to find them--and bringing 
them in. And they think that, you know, this could create an 
imbalance down the road.
    I just want to express that to you, that that is being 
heard. And I wonder if you have any comment.
    Mr. Taylor. The gentleman from Colorado, Mr. Coffman.
    Secretary Lynn. I guess not.
    Mr. Taylor. Oh, 10 seconds.
    Secretary Lynn. We do hear reports from the field. We need 
to follow up and make sure that all the steps that are taken 
are appropriate and that the government isn't doing anything 
inappropriate in seeking the goals of getting more expertise 
into the government. That is certainly not the objective of the 
insourcing program.
    Mr. Taylor. The gentleman from Colorado.
    Mr. Coffman. Thank you, Mr. Chairman.
    Mr. Lynn, Secretary Carter, and General Cartwright, thank 
you so much for your service to our country and your testimony 
today.
    I certainly respect the comments of Congressman Randy 
Forbes from Virginia in terms of the process and that maybe it 
wasn't the best process that you used in arriving at your 
conclusion.
    But I want to say this, as somebody who has served in both 
the United States Army and the United States Marine Corps and 
served in both the first Gulf war and the Iraq war, and that 
the 15 intervening years between 1990 and 2005, between my 
service in the first Gulf war and the Iraq war, there has just 
been a quantum leap in terms of jointness in our military. And 
I think that it is something that today is ingrained in our 
military culture. So I think that you are right to evaluate 
whether or not we still need the Joint Forces Command in light 
of the extraordinary changes and progress that our military has 
made.
    Let me go to a couple of other issues. First of all, on the 
insourcing/outsourcing issue, it seems that Republican 
Administrations want to outsource and Democrat Administrations 
want to insource. And let me just say that maybe there is a 
compromise between the two, and that is effectively managing 
contracts. And I am not sure that we are doing that right now. 
And I think we need to do a better job, before we make a 
decision about insourcing, in effectively managing the 
contracts that we have.
    And just a couple more quick issues, and then I would love 
your response.
    I think that one area that we could actually derive a 
savings and increase the effectiveness in our military--and it 
is not, certainly, a subject of our discussions yet today--is 
the fact that I think that our personnel system in terms of 
promotion is too rapid. And I think that our members of our 
military are not getting enough experience in their respective 
time and grades. And I think that we would improve our 
warfighting skills and save in the operating budget if we 
would, in fact, slow this promotion process down.
    And, with that, I would refer to--defer to any of you for 
comments.
    Secretary Lynn. On the issue of managing service contracts, 
we in fact agree with you, and a significant part of Secretary 
Carter's initiative earlier this month was improvements in that 
regard. Let me ask him to describe those for you.
    Secretary Carter. There are a number of those that have to 
do with improving our tradecraft, getting a better deal, better 
value for the $200 billion we spend on services. But 
specifically to the insourcing question raised twice, a couple 
points. First, yes, it has gone back and forth from time to 
time. I think the important thing to bear in mind is one size 
doesn't fit all. Some things it is beneficial to outsource. 
Mowing the lawn at the base. Why should the base commander have 
to figure out how to get the lawn mowed? There are people who 
do that for a living, and it is much more efficient to do that.
    When it comes to contracting officers, pricers, systems 
engineers and a systems command, you really want to have in the 
government people who have those skills. And what lay behind 
the Secretary of Defense's insourcing initiative for the 
acquisition workforce, which is ongoing and which he has 
indicated is not being curtailed because of the efficiencies 
initiative, was less to save money, though on average it can be 
the case that a government employee fully loaded costs less 
than a contractor, the point was to get within our walls and on 
our side of the table the talent that we need responsibly to 
spend $400 billion in contracting goods and services that we do 
every year.
    So are we poaching? I mean we do go to the open market and 
ask people to come and join the ranks of government. They come 
from some other job. I am delighted when they do come. I will 
tell you I talk to these people. And what we have on our side 
when we recruit is the mission. We don't have money, we don't 
pay a lot, our buildings aren't steel and glass, you know, they 
are wood and mold, and so forth, but we have the mission, and 
that is, particularly for young people--what really gets them 
hooked is the idea that they are going to be contributing to 
national security.
    Mr. Coffman. Let me just interrupt one point. But you also 
have a personnel system that rewards mediocrity in the sense 
that it takes an act of God to fire somebody, and that 
definitely needs to be reformed. Go ahead.
    Secretary Carter. I agree with you, and that in fact is 
something that Secretary Gates emphasizes all the time, and 
another thing that we are trying to address in the course of 
the workforce initiative.
    Mr. Taylor. The gentleman from Connecticut, Mr. Courtney, 5 
minutes.
    Mr. Courtney. Thank you, Mr. Chairman. I just want to thank 
the witnesses for their testimony today.
    Dr. Carter, in your testimony I think you sort of framed 
the fact that just setting aside all these percentage numbers, 
increase, decrease, I mean the fact is we still have to deal 
with the challenge of the alternative of broken or canceled 
programs or ones that work. And I think really that really 
should be the outcome that we are all trying to together 
achieve. And in the short time that I have been here, seeing 
the Presidential helicopter and the Zumwalt destroyer program 
just sort of collapse under their own weight, you know, that is 
not a rhetorical point that you were making in your testimony.
    The program that we have been keeping an eye on over the 
last year or so is the SSBN program, which as you point out, 
has been endorsed by the QDR, Nuclear Posture Review, and was 
included in the 30-year shipbuilding program, but there is no 
question that the price tag which the Navy was, you know, 
assuming was one that was going to potentially challenge the 
surface ships of our Navy. And again, it appears from your 
testimony that already just within the last few months, I mean 
there has been some progress made in terms of that milestone A 
cost reduction.
    You know, I guess the question is, you know, that reduction 
has nothing to do with the fact that this administration is 
still committed to moving forward with SSBN, which I appreciate 
if you could address that point, and secondly, that the 
capability that has been identified in terms of that program 
and our national security need for a sea-based deterrent also 
is not being compromised. It is really about trying to, again, 
not end up with another Zumwalt program that 10 years, 20 years 
down the road, is going to be unsustainable and really affect 
our ability to defend ourselves as a Nation. So I was wondering 
if you could address that point.
    Secretary Carter. I think that is accurate. It is more a 
question of how than whether. On the other hand, if you don't 
get the how right you can get the whether wrong, if you are 
following me. And the helicopter is an example of that. So we 
don't want to get ourselves in a situation with SSBN(X) where 
we design a submarine that we know we won't be able to afford. 
And the Navy has done, I think, an excellent job in the last 
several months of going through all the design drivers for 
SSBN(X) and looking at where the change in one of the design 
features or one of the requirements that drives the design 
features can be changed in such a way that the cost of the 
submarine is reduced without sacrificing in any way essential 
military capabilities. And this kind of disciplined systems 
engineering job really does work. They have managed to reduce 
the estimated cost of that submarine by 16 percent already. And 
it is very plausible that they will get down to the 27 percent, 
which is the target. And if you consider that this is a project 
that is going to cost hundreds of billions of dollars over the 
next 20 years, if you are talking 16 percent, $27 billion in 
costs you won't have to pay, that is a significant engineering 
achievement. And it will bring the submarine in at a price that 
the country will afford. It won't be one of these programs that 
collapses of its own weight.
    Mr. Courtney. And the timing of that milestone, given the 
fact that the design work is really just sort of commencing at 
this point, I mean really is consistent with all the 
acquisition reform models that this committee endorsed, which 
is to not get ourselves into a position of design-build at the 
same time and wasting money. And again, I think what you have 
described is something that fits well within the schedule that 
your budget is embarking on. And as you said, long term that is 
going to create some relief for the Defense budget without 
sacrificing any of our country's deterrence, which again is 
something that is I think--again, has been embraced by this 
administration. I mean again, there is no compromise that is 
being made as far as this initiative regarding those goals 
which were set forth in the NPR [Nuclear Posture Review] and 
the QDR.
    I just wanted to at least underscore and emphasize that.
    Secretary Carter. Absolutely, it is consistent both with 
the NPR and QDR, and very much with the intent of the work of 
this committee in the area of acquisition reform, particularly 
at the beginning of the program lifecycle.
    Mr. Courtney. Thank you. I yield back.
    Mr. Taylor. The gentleman from Utah, Mr. Bishop, 5 minutes.
    Mr. Bishop. Thank you, Mr. Chairman. Gentlemen, this is an 
important issue, which is why many of us are staying here a 
little bit longer. I want to go into another area of weeds, if 
I could, for just a moment.
    First of all, General Cartwright, thank you for being in 
Utah recently. The wife of my Legislative Director thanks you 
very much for her purse. And we will just leave that issue 
right there.
    Mr. Carter, if I can talk to you, though, specifically 
about it, I have been appreciative in the past of your 
understanding of industrial base issues, especially as we 
talked about solid rocket motors, when other agencies outside 
of the Department of Defense and the White House were clueless 
about the entire issue. I want to address, because I am 
concerned, especially when we are talking about a $100 billion 
cut when recapitalization is yet to be completed, concerned 
about another industrial base, and this one is small turbine 
engines. The weapon of choice that we have is basically the 
cruise missile, Tomahawk, Tactical Tomahawk air-launched cruise 
missile. We have those because the industrial base produces 
them at a low cost with a very high-efficiency small turbine 
engine. Yet one of the proposals to cut the Tomahawk 
procurement and to zero out R&D [research and development] on 
the supersonic cruise missile definitely puts that private 
sector in danger of maintaining that industrial base and losing 
the expertise we have to keep those programs functional.
    So the three questions I do have specifically for you, is 
the small defense turbofan industrial base something that your 
office has specifically identified as a defense industrial base 
concern?
    Secondly, what can we expect to see from your office or DOD 
in the way of specific actions to address an industrial base 
concern if it indeed has been identified as such? And finally, 
with Russia and India announcing sometime back they are jointly 
fielding a supersonic cruise missile, is it wise for this 
administration to pull back R&D at this particular time? And is 
that, once again, something that was a specific point of 
discussion in making your decisions on zeroing out the R&D on 
the supersonic cruise missile as well as cutbacks in 
procurement of Tomahawk?
    Secretary Carter. Thank you, Congressman. I think I can 
answer all three of those questions. Certainly to the first 
question emphatically, yes, I am aware of the issue that the 
end of TACTOM [Tactical Tomahawk] production occasions. We have 
specifically identified it as an industrial base issue. And I 
should say industrial base issues are, as you noted, very 
important. Deputy Secretary Lynn has identified that as an area 
of great importance to the Department and expects us to pay 
attention to it, and we are. I don't know the actions that will 
come out of that review yet.
    Mr. Bishop. Secretary Carter, let me in the interests of 
time just direct you here. If you could write what the actions 
will be, submit it to us later on, that would be fine.
    Secretary Carter. Will do.
    Mr. Bishop. If, though, you could answer the question on 
the Russian and Indian activity, was that a part of the 
consideration? Did you discuss that before making this 
decision?
    Secretary Carter. Yes. Not those specific programs, but the 
global situation and the other--and the investments that we 
will need to make in stand-off weapons. We know we will need to 
make investments in stand-off weapons. They are being 
considered as part of the long-range strike family of systems 
work that is going on. They may well result in other kinds of 
new stand-off weapons programs. And it is for that reason, it 
is to protect that option that the industrial base is so 
important. So that if we do choose that option again in the 
future, we will have the industrial capability to produce the 
engines.
    Mr. Bishop. Thank you. I appreciate your concern for that 
base. Too many people have the naive idea these bases can be 
just turned on and off like a spigot.
    Congressman Taylor, thank you for allowing me to get that 
question, and I yield back.
    Mr. Taylor. General, we recently had a classified briefing 
on the roller situation in Afghanistan, and the need to deploy 
them in a more expedient manner. One of the things that came to 
light, and I am trying to stay within the confines of the 
classified nature of that, was that the SPARKS II [self-
protection adaptive roller kit system II] roller is made 
overseas, and that the date for all of them being delivered is 
several months off. One of the things that is delaying the 
arrival of all of them is that in the purchase of this we did 
not get the technical data package. I would hope that one of 
the revisions that your organization is looking into making is 
that any time our Nation pays to develop a weapon, that as a 
part of that contract that we will own the technical data 
package for that product, and that if we feel like a supplier 
is taking too long to deliver that product then we, as a 
Nation, will have the right to take that technical data package 
to another supplier if need be in order to get that program 
delivered in a more timely manner.
    I don't think as a citizen, any citizen of this country 
wants to see a single soldier, sailor, airman, or marine lose 
their life or limb needlessly because we are waiting on someone 
who has the exclusive rights to that information to take too 
long to deliver it.
    I would welcome any of the Secretaries' or the General's 
thoughts on that, but most of all, I want to hear your 
reassurance that going forward that any time we are spending 
the Nation's money to develop a product that we are going to 
own the technical data package to that product that we paid to 
have delivered.
    Secretary Carter.
    Secretary Carter. If I may, I am very aware of the SPARKS 
roller issue. They are being destroyed at a rate larger than we 
had anticipated.
    Mr. Taylor. And for the sake of the public, the good news 
is when the roller is destroyed the vehicle behind it is not.
    Secretary Carter. That is exactly right.
    Mr. Taylor. But the bad news is then we have to get another 
roller to theater in a hurry.
    Secretary Carter. That is exactly right. And I agree with 
you about technical data package. You and I have discussed that 
in the context of the Littoral Combat Ship competition. And I 
will just note that in the spirit of amen to what you said, 
that in the document that I issued 2 weeks ago, that of the 23 
items in that, one is specifically to improve the way that we 
acquire technical data packages. We need to learn what our 
rights are in that regard and also how to value them so that we 
can carry out the transaction, appropriate transaction with 
industry. So I agree with you completely.
    Mr. Taylor. Okay. With that, the chair recognizes the 
gentleman from Virginia, Mr. Nye, 5 minutes.
    Mr. Nye. Thank you, Mr. Chairman. I appreciate you yielding 
time to me earlier. I just wanted to follow up with a couple of 
thoughts and questions.
    Secretary Lynn, you heard from a number of members of the 
committee today the notion that this process is hard, the 
process of finding savings to reallocate within the Defense 
Department is a challenging one, but that having the committee 
involved and using the regular 2012 budgeting process is 
probably the best route to do that.
    Now, what I wanted to ask you was, and I know that the 
Secretary has said most of the decisionmaking he intends to be 
done during that process, and I think you have backed that up 
today. I am curious to know if you can give us, shed any light 
on why Secretary Gates decided August 9th was the right time to 
sort of preannounce a certain segment of those decisionmaking 
and not to--noting the fact that we have had some discussion 
about the fact that an analysis of Joint Forces Command, for 
example, of how this could and would be done and what the 
options would end up being has yet to be done, why August 9th? 
Why not wait and just do this as part of the regular process?
    Secretary Lynn. I think Secretary Gates felt a strong need 
to jump-start the process to establish that this was going to 
be an aggressive process, that this was going to be a process 
that he was going to be involved in personally, and that he 
wanted to start by establishing what he has called a culture of 
savings. And in particular, he focused on the areas of 
headquarters, of staffing, general officers, senior executives, 
redundancy, extra layers. And he wanted to take steps that were 
really more management steps that he could take immediately to 
try and establish the path ahead so that as we go forward with 
the budget the rest of the building would follow on and be 
equally aggressive.
    Mr. Nye. Okay. Well, again, I just want to encourage you in 
the strongest possible terms to do this process within the 
regular established order. I think you will find that your 
ability to work with the Congress on it will be greatly 
enhanced if we have an opportunity to be part of that process. 
I want to say and again recognize that you have said today you 
intend to include us in that analysis process before any 
decisions are implemented. Thank you for that.
    I also want to know that General Cartwright has said today 
that during that analysis at this point all options are still 
on the table, and essentially the status quo is one possible 
option for the outcome of that analysis. One possible option. 
We may reach another conclusion. But that is still on the table 
as a possible outcome. And I appreciate the fact that we will 
be allowed to be involved in the analysis and the process going 
forward.
    But one last thing I want to make in terms of comments, and 
I want to follow up on something that Mr. Wittman asked about, 
he asked you have you or can you give us an example of when a 
decision was made without an analysis, which we agree needs to 
be done, you know, sort of the cart before the horse idea? I 
can tell you I can think of one. And that has to do with the 
recommendation to build a fifth U.S. carrier homeport in 
Mayport without the analysis done to support that decision.
    Now, I say this just to say, and for the record, given the 
fact that we are going through a difficult decisionmaking 
process of how to save money, cut down on overhead and 
reallocate it within the Defense Department, I will be very 
surprised and dismayed if during this 2012 budget process that 
we have coming up the Defense Department again, having stated 
that we have got to find savings in overhead, especially things 
that are redundant and duplicative, asks for money to build a 
billion-dollar port facility in Mayport that is by its very 
nature duplicative and redundant.
    I don't need an answer from you. I just wanted to state 
that for the record. Again, this is a tough process. I 
recognize that you all have very difficult work to do here, and 
so do we, and I appreciate the fact that you have recognized 
that today. To be honest with you, I think that recognition was 
late in coming, but I am happy to note that you have agreed 
that we should be part of that process going forward. I look 
forward to working with you in taking a very good business 
case, if you want to use that word, military look, but an 
analysis of the best decisionmaking that we can make going 
forward on the contractor issue, on Joint Forces Command, and 
all the other efficiency questions that we have to solve 
together. Again, I thank you for being here.
    Mr. Chairman, I yield back.
    Mr. McKeon. Will the gentleman yield? You have a few 
seconds left.
    Mr. Nye. Yes, I do.
    Mr. Taylor. Eighteen to be exact.
    Mr. McKeon. I just want to clarify what the gentleman has 
indicated in his statement and in his earlier statement, to 
reiterate or to confirm. What I hear him saying is that you 
have committed to involve the Congress in the decision to 
disband or to eliminate JFCOM. Or are you agreeing that you 
have already made the decision, you will make the decision, the 
Secretary will make the decision, the President will make the 
decision, and then you will include us in how you carry out 
that decision?
    Secretary Lynn. The Secretary has made his recommendation 
to the President on disestablishing Joint Forces Command. The 
President has not yet made his decision. And I have committed 
here with Congressman Nye and others that as we move forward on 
the implementation of that decision, should the President 
affirm it, we will work with the committee and the Congress in 
making those implementation decisions.
    Mr. McKeon. Okay. It just sounds like I hear you saying 
maybe he misunderstood or maybe he thought that you were going 
to involve the Congress in the decisionmaking. But rather that 
is already done and it is just now the implementation.
    Secretary Lynn. I think I would end up saying again what I 
just said.
    Mr. McKeon. All right. And I want to make sure that you 
like that answer. Thank you.
    Mr. Taylor. For the benefit of the committee, they have 
just called a vote on the adjournment resolution. So it is the 
chair's intention to keep this going for another 10 minutes. 
That will be followed by two 5-minute votes. That will make the 
hearing approximately 2 hours and 45 minutes.
    So having said that, in the 10 minutes that remain, the 
chair intends to recognize Mr. Wilson of South Carolina.
    Mr. Wilson. Thank you, Mr. Chairman. Thank you for being 
here today. Secretary Lynn, I share the concerns of Congressman 
Forbes. Thus far, your testimony is that the Joint Forces 
Command decision was made as a result of several ad hoc 
discussions among senior DOD officials. I know these officials 
have reviewed some documents that outline their military 
rationale for the decision. Knowing that there has been 
documentation considered, I request those documents, print and 
electronic, used as a basis for the military decisions to be 
provided to the committee.
    Additionally, my question is to Secretary Carter. The 
National Guard and Reserve forces have been instrumental in the 
global war on terrorism, and I know firsthand of how successful 
and capable our Guard and Reserve are. I served in both for 31 
years, and I have four sons currently serving in the military, 
three in the National Guard. However, Guard and Reserves still 
faces shortages of proper equipment for training and for use in 
theater.
    How are the proposed acquisition reforms going to affect 
the Guard and Reserve?
    Secretary Carter. The piece of the efficiency initiative 
that I was describing will affect the procurement of equipment 
irrespective of the ultimate customer, but I think the burden 
of your question about equipage of the Guard and Reserve in the 
future would be better answered by General Cartwright than by 
me.
    Mr. Wilson. General. Thank you.
    General Cartwright. As we work through these efficiency 
activities, the intent is to get to a better ratio of what we 
are calling tooth to tail, but to get those forces that are 
standing in order to go support either the global war on 
terrorism or any other activities that may be identified either 
on the Federal side or on the State side. The question is can 
we afford, through these efficiencies, to get sufficient 
equipment to outfit everybody with the best capabilities that 
we have? Or are we going do that in some other way? In other 
words, are there going to be shortages that we are going to 
have to manage? And if so, how we manage them? The idea here is 
to generate the resources so that we don't have those 
shortages.
    Mr. Wilson. Great. And you personally, I want to thank the 
Marine Corps. I represent Parris Island, Marine Corps Air 
Station, Beaufort Naval Hospital. I am very proud of the 
Marines.
    At this time, I yield the balance of my time to Congressman 
Forbes of Virginia.
    Mr. Forbes. Thank you, Mr. Wilson. Mr. Secretary, would you 
agree to provide to the chairman and the ranking member a copy 
of the nondisclosure agreement that you have required people at 
Joint Forces Command to sign?
    Secretary Lynn. I am not directly familiar with those 
nondisclosure agreements.
    Mr. Forbes. If there is one, would you----
    Secretary Lynn. But I will explore whether there is one, 
and I will report my findings to the chairman and ranking 
member.
    Mr. Forbes. And if there is one, will you give them a copy?
    Secretary Lynn. Yes.
    [The information referred to can be found in the Appendix 
on page 85.]
    Mr. Forbes. Can you tell us, is it your testimony today 
that you provided to this committee all of the written analysis 
that was given to the Secretary of Defense to make his decision 
to close the Joint Forces Command?
    Secretary Lynn. We have provided the committee----
    Mr. Forbes. Just need to know yes or no, all the written 
information. If you have, yes. If you haven't, no.
    Secretary Lynn. We have provided the committee the 
analysis, the rationale----
    Mr. Forbes. Mr. Secretary, I don't have much time. I am 
just asking have you provided all the written analysis that was 
given to the Secretary of Defense to this committee? If you 
haven't, it is okay. I just need to know.
    Secretary Lynn. I am going to have to--you are going to 
have to let me answer. We have provided the committee a body of 
material that supports what the Secretary----
    Mr. Forbes. That is not my question, Mr. Secretary. In all 
due respect, I am asking have you provided this committee with 
all of the written analysis that was provided to the Secretary 
of Defense to make the decision to close the Joint Forces 
Command? Yes or no? It is pretty simple.
    Secretary Lynn. We have provided the committee with the 
material that supports the decision that the Secretary made.
    Mr. Forbes. I am asking if you provided the written 
material that was given to the Secretary, all the material that 
was given to the Secretary for the Secretary to make his 
decision.
    Secretary Lynn. I have answered the question.
    Mr. Forbes. No, you haven't. You said you provided 
analysis, but that could have been back-filled analysis. I am 
asking have we gotten all the written documentation that was 
provided to the Secretary?
    Secretary Lynn. The Secretary has provided you the material 
that----
    Mr. Forbes. That he thinks we should have?
    Secretary Lynn [continuing]. That supports his decision. I 
will go back and see if there is more material that we can 
provide you.
    Mr. Forbes. So what you are saying is you don't know, as 
you are sitting there, whether there was more written 
information given to him or not?
    Secretary Lynn. I am saying that I will explore as to 
whether there is more material that we can provide you to try 
and help you with this decision.
    Mr. Forbes. Do you know if there was any more written 
material, Mr. Secretary, as you are sitting there testifying?
    Secretary Lynn. I am sorry, I didn't hear you.
    Mr. Forbes. I am saying do you know whether there was more 
written material given to the Secretary than was provided to 
this amendment?
    Secretary Lynn. I am saying that we will provide you--we 
provided you with a body of materials.
    Mr. Forbes. Mr. Secretary, my time is out. You are not 
going to answer the question, so I would like to have him 
provide us with the information, and I yield back.
    Mr. Taylor. The chair thanks the gentleman. The gentlewoman 
from Guam, Ms. Bordallo, 5 minutes.
    Ms. Bordallo. Thank you, Mr. Chairman. Secretary Lynn, it 
is good to see you again, Secretary Carter and General 
Cartwright. Let me divert slightly from the topic of today's 
hearing and bring up concerns about the military buildup in 
Guam, and they certainly are issues of cost efficiencies if we 
get the buildup done right.
    The Record of Decision was signed by Assistant Secretary of 
the Navy Jackie Pfannenstiel, and while the ROD [Record of 
Decision] delays the final decision on the location of a firing 
range, it states a preference to acquire land on the east side 
of the island, on a bluff above the Pagat historical and 
cultural site. I remain extremely skeptical that such a land 
acquisition deal can be struck with the Government of Guam.
    So with that in mind, can you outline what steps the 
Department is taking in regards to meet Marine Corps training 
requirements? Has the Department considered Tinian Island or 
some of the DOD land on Guam that could be used?
    And again I want to repeat I am skeptical that a deal can 
be struck, and I would not feel it prudent for the Department 
to spend billions of dollars without a deal secured for the 
training range.
    So can you please comment, and can I get your commitment to 
more seriously explore alternatives for the Marine Corps firing 
range?
    Secretary Lynn.
    Secretary Lynn. Congresswoman Bordallo, thank you for the 
question. I appreciate the question. As you know, I recently 
visited Guam and saw for myself the plans and the issues that 
we face.
    The training range is a critical issue. I agree with you. 
To have the Marines move to Guam and to maintain the levels of 
training that we would expect out of a Marine unit, we do need 
to find some resolution of this issue. I think you correctly 
described it, Pagat, that location in Pagat is the preferred 
location. That was after analyzing government land and some 
other options. Tinian is off island, probably appropriate for 
some training, but not close enough for the small arms training 
we are talking about here. We are much more interested in a 
training range on Guam.
    We are continuing--I understand the cultural concerns in 
the Chamorro site that is there. We are continuing to work 
those issues. And we are hoping that we can find a resolution 
that allows the Marines to conduct their training on Guam 
without compromising the cultural site. And we are going to 
continue to work with you on that, and I agree it is a critical 
issue for going forward.
    Ms. Bordallo. Thank you, Mr. Secretary, and I do want to 
get it on record to state that you are seriously looking at 
alternatives.
    I have another question. General Cartwright, I guess I am 
following up on Congressman Wilson's questions. The 
recommendations put forth are a good start on some of these to 
maximize efficiencies. But as I reviewed the recommendations, I 
am perplexed as to why the Department has not tackled personnel 
costs. And what further frustrates me is that I don't see 
anywhere where the National Guard plays a role in the 
solutions. This is a frustration of mine with regards to the 
buildup in Guam and now here. The Guard has demonstrated that 
it can recruit and retain quality soldiers and airmen at a 
significant savings over the active duty personnel.
    So can I get a commitment to more adequately review this 
potential efficiency?
    General Cartwright. I think your reference here is more 
frequent use of the Guard in lieu of the active force----
    Ms. Bordallo. That is correct.
    General Cartwright [continuing]. And ensuring that they are 
well equipped as they go forward, and well trained and afforded 
the opportunities to be well equipped.
    Ms. Bordallo. And there will be savings.
    General Cartwright. The Guard in itself would generate 
savings. This effort will generate savings to equip the Guard 
and continue to keep the Guard trained at the levels that we 
have become accustomed to, which is substantially higher than 
anything we have experienced in the past. So our commitment 
here is to generate this savings so that we can plow it back 
into that tooth, which we consider the Guard to be. How much we 
get here, and then our work with the Congress will determine 
the amount of money that is available to do that.
    I acknowledge the fact that there are savings that we reap 
from utilizing the Guard that we don't necessarily receive 
utilizing active forces, but there are trades that we make 
there in that area also operationally.
    Ms. Bordallo. Thank you. I yield back.
    Mr. Taylor. The chair thanks the gentlewoman. The chair now 
recognizes the gentleman from Virginia, Mr. Scott, for--if you 
could keep it very brief, Mr. Scott, we have only 3 minutes 
remaining on the vote across the street.
    Mr. Scott. Thank you, Mr. Chairman. I appreciate the 
opportunity to get a couple things quickly on the record. 
Secretary Lynn, in the QDR there was no recommendation to close 
JFCOM. Is that right?
    Secretary Lynn. That is correct. It didn't address command 
issues.
    Mr. Scott. And there was no recommendation to close JFCOM. 
And during the last BRAC, JFCOM was mentioned but the decision 
was made not to close JFCOM. Is that right?
    Secretary Lynn. Yes.
    Mr. Scott. And it was mentioned in BRAC, which suggests 
that BRAC has jurisdiction, which is an interesting little 
thing. In reference to your answer to my colleague from 
Virginia, Mr. Forbes, you said you have given information that 
supports the decision. That invites the inquiry whether there 
are documents that did not support the decision that are 
floating around. Are such documents--do such documents exist?
    Secretary Lynn. Not to my knowledge.
    Mr. Scott. No document exists that gave an evaluation that 
suggested that maybe it shouldn't be closed? There was no 
written debate about this?
    Mr. Taylor. Mr. Scott? I hate do this to you, but we are at 
the 2-minute mark. Could I ask you to please submit the 
remainder of your questions for the record?
    Mr. Scott. If I could just get a quick answer to that, and 
thank you very much, Mr. Chairman, for the opportunity to just 
get in a couple of questions.
    Mr. Taylor. If you would, the gentleman is going to submit 
the remainder of his questions for the record.
    Secretary Lynn. Fine.
    Mr. Taylor. General Cartwright, Chairman Skelton also has 
some questions for you for the record. With that, I do want to 
thank all three of you gentlemen for being here.
    The meeting stands adjourned.
    [Whereupon, at 12:37 p.m., the committee was adjourned.]
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                            A P P E N D I X

                           September 29, 2010

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              PREPARED STATEMENTS SUBMITTED FOR THE RECORD

                           September 29, 2010

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                   Statement of Chairman Ike Skelton

           The Department of Defense's Efficiency Initiative

                           September 29, 2010

    Welcome everyone to the House Armed Services Committee's 
hearing on the Department of Defense's Efficiency Initiative. 
We have with us three distinguished witnesses: Deputy Secretary 
of Defense William J. Lynn, III, the Department's Chief 
Management Officer; Dr. Ashton Carter, the Under Secretary of 
Defense for Acquisition, Technology, and Logistics; and General 
James E. Cartwright, USMC, the Vice Chairman of the Joint 
Chiefs of Staff.
    The topic they are here to discuss is one of the most 
important we will consider this year. And it will be 
particularly important next year when the committee reviews the 
President's budget request for fiscal year 2012. That topic is 
the Department's effort to wring billions of dollars of 
efficiencies out of its operations.
    I want to begin and end this hearing with one clear 
overriding message. I think I speak for the overwhelming 
majority on this committee, regardless of party, when I tell 
you that I do not support cutting the defense budget at this 
time. The national security challenges this Nation faces around 
the world dictate that we maintain the recent growth in our 
ground forces, the Army and the Marine Corps; that we modernize 
our Air Force; and that we grow our Navy. To do this, we must 
continue to grow the base defense budget for some time to come.
    I think I can also speak for the committee in saying that 
we all want to eliminate waste within the Department wherever 
and whenever we find it. I commend the Secretary of Defense and 
his able support team, well represented here today, for making 
hard choices that have too often been avoided in the past. As 
you all know, this committee hasn't agreed with every decision 
made, nor should we, but we do respect the leadership being 
demonstrated at the Department of Defense.
    The Department's efficiency initiative is the most 
comprehensive effort of its kind in almost 20 years. Across the 
board, this committee stands ready to hear the Department's 
case. In the area of acquisition reform, we believe the 
Department's initiatives are very much aligned with policies 
the committee has advocated for years and which were recently 
clearly expressed in the report of our Panel on Defense 
Acquisition Reform. In other areas, we look forward to better 
understanding what the Department is proposing and what savings 
will be achieved. When it comes to jointness, insourcing, and 
information technology, this committee has longstanding 
interests and concerns that may not align as clearly with the 
Department's proposals.
    As long as I have served in Congress, the system has worked 
one way: the Administration proposes, and the Congress 
disposes. This year and next will be no different. So 
gentlemen, your task today is to persuade us that this 
initiative is not part of an agenda to cut the defense budget, 
and that it is consistent with this committee's longstanding 
priorities in a number of critical areas.

         Statement of Ranking Member Howard P. ``Buck'' McKeon

           The Department of Defense's Efficiency Initiative

                           September 29, 2010

    Secretary Lynn, Secretary Carter, and General Cartwright, 
good morning and welcome. We have been looking forward to your 
testimony on the Department's efficiencies initiative for some 
time. I hope that you will be able to provide members of this 
Committee with detailed information regarding the Secretary's 
proposed measures and to allay the concerns that many of us 
share.
    As elected officials, Members of Congress have a 
responsibility to ensure U.S. taxpayer dollars are not wasted 
on inefficient, wasteful or redundant programs. I agree with 
Secretary Gates that we must scrutinize defense programs to 
ensure we are generating the most bang for the buck and that we 
must concentrate our limited resources on the highest-priority 
programs. Furthermore, I view it as the responsibility of the 
Armed Services Committee to exercise the same discipline on an 
annual basis, through our defense authorization act, to shift 
funds from poorly performing programs to higher national 
security priorities and promising technologies for the future, 
such as missile defense and means to counter anti-access 
threats.
    But, as with most things, the devil is in the details. 
Unfortunately, although we have requested more information, 
both verbally and in writing, the Department has failed to 
fully respond. My first concern is where we find $20 billion a 
year in cuts--in the midst of two wars--without also cutting 
back on required weapons and services needed to meet the 
threats of today and tomorrow. Secretary Lynn, you've already 
announced that at least a third of the savings will come from 
within the force structure and modernization accounts--the same 
accounts the Secretary is attempting to grow. We have seen that 
setting arbitrary targets for cost savings, as appears to have 
happened with insourcing, can frequently not yield the expected 
results. How do we avoid those pitfalls here?
    Second, I am extremely concerned that no matter what the 
intentions of the Secretary may be, the Administration and some 
in Congress will not allow the Secretary to keep the savings. 
This summer, the White House supported a teacher bailout bill 
that was funded in part with defense dollars. Once these 
savings from this efficiencies initiative are identified, 
what's to stop them from taking this money, too?
    We're already seeing impacts of this summer's cuts. For 
example, some of those funds were intended to rectify an 
overdraft in the Navy's military pay accounts. Once those funds 
were taken, the Navy was forced to take the money from aircraft 
procurement accounts. What's the result? It's going to take 
longer to buy the external fuel tanks our Super Hornets and 
Growlers need and to upgrade training simulators. Even worse--
it will cost the taxpayers more money to buy those fuel tanks 
because we won't be able to take advantage of a negotiated bulk 
buy. So much for efficiency.
    Secretary Gates appears to share my concern. In August he 
stated, `` . . . my greatest fear is that in economic tough 
times that people will see the defense budget as the place to 
solve the nation's deficit problems, to find money for other 
parts of the government. I think that would be disastrous in 
the world environment we see today and what we're likely to see 
in the years to come.''
    Third, with respect to acquisition reforms, most of these 
appear to be consistent with Congressional direction. I would 
like to learn more about the Department's plans to set cost 
targets for new weapon systems. Congress supports analytical 
trade-offs between required capabilities, time to the 
warfighter, and cost. However, our requirements must be 
determined by the future threat environment, not simply by our 
budgets.
    The Department will have to convince members of this 
committee that these efforts will not weaken our nation's 
defense. To that end, we must fully understand the rationale 
behind each decision and potential impact of every cut. Case in 
point--who within the Department of Defense will be responsible 
for ensuring our commanders in Afghanistan and Iraq have the 
correct number and mix of military forces, if the Department 
eliminates the Joint Forces Command?
    Thank you for your willingness to provide this Committee 
with the information we require to conduct thorough oversight 
and support the Secretary's efforts to grow our investment 
accounts.

                              TESTIMONY OF

                          William J. Lynn, III

                      Deputy Secretary of Defense

                Before the U.S. House of Representatives

                        Armed Services Committee

                           September 29, 2010

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                           September 29, 2010

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              QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                           September 29, 2010

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

      
                   QUESTIONS SUBMITTED BY MR. SKELTON

    Mr. Skelton. Deputy Secretary Lynn, the DOD General Counsel legal 
opinion is based on the concept that there will be enough United States 
Joint Forces Command (JFCOM) workload reduced that the number of 
civilian employees realigned will fall below thresholds for coverage 
under the Base Realignment and Closure statute. What JFCOM functions 
was the DOD General Counsel's office told were being eliminated in 
formulating this legal opinion? If the General Counsel was not provided 
with a list of workload reductions, what assumptions or factual 
elements were provided in obtaining the legal opinion?
    Secretary Lynn. The DOD General Counsel was told that the Secretary 
was proposing the disestablishment of JFCOM and was asked to analyze 
the extent to which the requirements of Section 2687 of Title 10, 
United States Code might apply to that action. No specificity regarding 
the functions or number of personnel positions to be eliminated was 
provided, just a general statement that the Department anticipated 
eliminating a significant number of functions and personnel positions. 
The Office of the General Counsel therefore did a location-by-location 
analysis, examining the full range of possible actions to accomplish 
the disestablishment. The attached paper explains the extent to which 
any such action would, or would not, trigger the requirements of 
Section 2687. The paper does not assume or depend upon any specifics 
regarding what functions or what number of personnel positions would be 
eliminated; rather it simply explains the legal effect of the full 
range of possibilities.
    Mr. Skelton. Deputy Secretary Lynn, by law, the department must 
manage its civilian workforce by workload and funding, rather than use 
arbitrary constraints. How is the freeze consistent with the law? Why 
won't the freeze lead to reductions in civilian employees without any 
workload analysis?
    Secretary Lynn. 10 U.S.C. Sec. 129 does not prohibit managing our 
civilian workforce by any particular accounting convention, such as man 
years, end strength, or full time equivalent (FTEs) targets, provided 
that those conventions are based on workload or funding. In his 
efficiencies roll-out speech on August 9, 2010, Secretary Gates stated 
that for the past two years Department leadership has been working on 
reforming the way the Pentagon does business. He referenced the fact 
that sustaining the current force structure and making needed 
investments in modernization will require annual real growth of 2 to 3 
percent, which is 1 to 2 percent above current top-line budge 
projections. He also referenced the fact that in May 2010, he ``called 
on the Pentagon to take a hard, unsparing look at how the department is 
staffed, organized, and operated.'' The conclusion from that study was 
that the headquarters and support bureaucracies had grown cumbersome 
and top-heavy, overreliant on contractors, and accustomed to operating 
with little consideration to cost. Further, as he outlined his four-
track approach he made it clear that it will be incorporated in the FY 
2012 budget request.
    We are now in the midst of a careful evaluation of the roles and 
functions of our component organizations that considers the most 
effective allocation human capital--government and contract personnel 
alike. Our problem is that our entire workforce has grown too large and 
we must take steps to control this growth. The Department is not 
conducting a civilian hiring freeze. Rather, we are halting the growth 
of our workforce and reducing our reliance on service support 
contractors through targeted reductions.
    Mr. Skelton. Deputy Secretary Lynn, in announcing the efficiency 
initiative, the Secretary has focused on examining opportunities to 
reform many of the Department's business operations, such as 
contracting, acquisition, and human capital. The FY08 NDAA established 
the Deputy Secretary of Defense as DOD's Chief Management Officer 
(CMO), established a Deputy CMO (DCMO) to assist the CMO, and 
designated the service Under Secretaries as CMO for their departments.
    What is your role, as the CMO, in the efficiency initiative? What 
specific responsibilities have been given to the CMO and how are these 
being carried out?
    Secretary Lynn. As CMO, I review all recommendations from the 
Efficiencies Task Force as part of the Secretary's leadership and 
decisionmaking team.
    The Secretary's call to cut overhead costs and transfer those 
savings to force structure and modernization is effectively 
accomplished through the four tracks detailed in his initiative 
announcement to include:

    1) Finding $100 billion in savings over the next five years that 
can be reallocated to priority warfighting and modernization needs.
    2) Seeking suggestions from industry, advisory boards and DOD 
employees on new ideas to achieve efficiencies.
    3) Reviewing how the Department is organized and operated to 
identify necessary changes to how we do business.
    4) Implementing 23 initiatives on defense acquisition and 
contracting, such as reduction of funding for support contractors by 10 
percent a year for the next three years.

    These tracks are being implemented across the Department. For 
example, the Secretary issued guidance to each of the Military 
Departments and Defense Agencies with specific savings targets that are 
to be met as part of the budget preparation process for the FY 2012 
President's budget; conducted the Innovation for New Value, Efficiency 
and Savings Tomorrow (INVEST) contest, which solicited cost-cutting 
ideas from our workforce; and made the decision to close the Joint 
Forces Command (JFCOM), the Office of the Assistant Secretary of 
Defense for Networks and Information Integration and the Business 
Transformation Agency (BTA). Disestablishment plans for those 
organizations are under development.
    Mr. Skelton. How will the task force being led by the Secretary's 
chief of staff interrelate with the CMO, DCMO and military department 
CMOs?
    Secretary Lynn. The Secretary's Chief of Staff chairs the 
Department's Efficiencies Task Force, with support from established 
study groups. These groups are tasked with managing the four tracks 
detailed by the Secretary in his efficiency initiative announcement. As 
CMO, I review all recommendations from the Efficiencies Task Force as 
part of the Secretary's leadership and decisionmaking team. The 
Secretary's Chief of Staff is working with the DCMO on the closure of 
BTA and the INVEST contest.
    Mr. Skelton. What is the role of the Deputy CMO and military 
department CMOs with respect to the efficiency initiative? What 
specific responsibilities have been given to the CMO and how are these 
being carried out?
    Secretary Lynn. The DCMO is working with the Department's senior 
leadership to ensure BTA critical skill sets and functions are 
retained, but functional overlaps are eliminated. Second, the DCMO is 
administering the Department's INVEST contest. This contest solicited 
DOD military and civilian employees' creative ideas to save money, 
avoid cost, reduce cycle time, increase agility and use resources more 
effectively. The contest ran from August 9, 2010 through September 24, 
2010, and 15,890 ideas were submitted. The Department is currently 
evaluating these ideas.
    Military Department CMOs have broad responsibility for implementing 
the Secretary's efficiency initiative within their respective 
organizations and achieving the Secretary's goal for each Military 
Department in shifting $28.3 billion in overhead costs to force 
structure and future modernization.
    The Army CMO was designated as the single oversight lead for all 
Army efforts in meeting objectives across the four tracks detailed in 
the Secretary's announcement. In this role, the Army CMO has: 
delineated specific roles and responsibilities of Army leadership for 
14 specific efficiency tasks; established guidance to ensure 
synchronization and integration of Army-wide initiatives affecting 
adjustments to the FY 2012-2016 Program Objectives Memorandum (POM); 
and expanded Army initiatives to a longer-term effort incorporating a 
holistic review of major Army Enterprise programs, capability portfolio 
reviews and processes to garner efficiencies in the out-years (Program 
Review 2013-2017). The Army CMO also directed establishment of a 
process to identify, assess and implement future DOD and Army 
efficiency initiatives that leverages the Army integrated management 
processes against specific metrics and efficiency targets.
    The Department of the Navy (DON) CMO is tasked with tracking and 
coordinating across the Navy, Marine Corps and Secretariat, all 
efficiency-related pursuits with the specific goal of 
institutionalizing an enterprise-wide culture of efficiency. The DON 
CMO is responsible for establishing and chairing a Department of the 
Navy Efficiency Implementation and Monitoring Program and leads an 
efficiency working group within DON to increase awareness of efficiency 
tasks, coordinate specific issues across multiple stakeholders, and by 
doing so, avoid duplication of effort. The DON CMO is also leveraging 
the Department of the Navy Business Transformation Council to 
incorporate the efficiency initiative into the DON's overall business 
transformation program.
    The Air Force CMO is the lead in working with DOD's Efficiency Task 
Force, and is tasked, together with the Air Force Vice Chief of Staff, 
with providing final efficiency recommendations to the Secretary of the 
Air Force. The Air Force CMO is aggressively working to reduce overhead 
and realign savings to warfighting needs; seek proposals from the 
entire Air Force; assist in the conduct of front end assessments to 
inform the FY 2012 budget request; and to assist in reducing excess 
duplication across the entire DOD Enterprise. To meet the Secretary of 
the Air Force's direction to find $28.3B in efficiencies across the 
Future Years Defense Program, the Air Force CMO and Vice Chief of 
Staff, as co-chairs of the Air Force Council, are utilizing the Air 
Force Corporate Structure to ensure top-level leadership and focus on 
our efforts in improving warfighting capability while shedding non-
value added work and improving efficiency. In this effort, the Air 
Force CMO is responsible for ensuring efficiency priorities and 
objectives are integrated into Air Force business transformation and 
other related strategic plans, as well as Air Force's performance 
management processes.
    Mr. Skelton. If not the CMO, who in the Department is accountable 
for making sure that the initiative is fully implemented?
    Secretary Lynn. The Secretary of Defense and the Department's 
entire senior leadership team are working together to implement and 
assume accountability for this initiative.
    Mr. Skelton. Dr. Carter, does the Department have the human 
capital, the numbers and the expertise, to truly implement the reforms 
in Dr. Carter's September 14 guidance? In particular, does the 
Department have the expertise to conduct should cost and will cost 
management of programs?
    Secretary Carter. The Department has program management, cost and 
engineering capabilities within the existing acquisition workforce that 
are critical to executing programs and facilitating affordability 
decisions. However, the Department recognizes that the size and 
composition of this existing workforce must be expanded to be able to 
apply these core capabilities to meet the more detailed affordability 
analysis needs of all acquisition programs and to more fully enhance 
those capabilities in support of Major Defense Acquisition Programs.
    The Department is committed to using disciplined program management 
practices, revitalizing cost-related capabilities, and reversing a 
decade-long decline in the organic workforce. To get best value for 
taxpayers, DOD will enhance the cost-estimating and pricing capability 
to improve program estimates and ensure we price contracts 
appropriately. As reported in our April 2010 report to Congress ``The 
Defense Acquisition Workforce Improvement Strategy FY10,'' to improve 
quality, the Department is expanding and improving training programs in 
this area. We have created a separate cost-estimating career path 
within the Business career field, and now require 7 instead of 4 years 
of experience to achieve Level III certification. Currently, the 
Department has more than 900 cost-estimating positions in the DOD 
acquisition workforce supporting a diverse set of technical and program 
activities. The cost analysis capability at the program office level is 
supported and guided by existing cost analysis organizations within 
each Component acquisition product division and organizations at the 
Component headquarters level that provide independent cost analyses to 
support Component Acquisition Executive decisions. In the Office of the 
Secretary of Defense, the Cost Assessment and Program Evaluation 
organization provides an additional level of capability to provide 
estimates to inform Department-level decisions on acquisition programs 
and their affordability.
    In terms of Engineering-related capabilities within the acquisition 
workforce, the Department currently has 38,000 positions in the 
``Systems Planning Research Development Engineering--SPRDE'' technical 
workforce. The SPRDE workforce represents the Department's core 
capabilities for executing the range of engineering trade-off studies 
including life cycle cost modeling in all phases of the acquisition 
process. These trade study and modeling activities are critical to 
making informed choices that impact system affordability. As part of 
the Organization and Capability Assessment efforts mandated by Public 
Law 111-23 (Weapons Systems Acquisition Reform Act of 2009), the 
Department is currently working with the Military Departments and 
Agencies to assess the current capability of the workforce members 
providing engineering-related expertise. The Department possesses the 
capabilities needed at the present time by using government personnel 
with augmentation from systems engineering-focused Federally Funded 
Research and Development Centers (FFRDCs) and contractor personnel. The 
transition to an indigenous organization of government technical 
personnel is in progress and is anticipated to take several years.
    The Department has been working closely with the Military 
Departments on several Major Defense Acquisition Programs with good 
results from carefully thinking through requirements, business 
strategies, cost estimates and engineering trade-offs. As Secretary 
Gates has said, ``There is no silver bullet'' for changing how the 
Department conducts business, and it will take time to fully implement 
these ideas across the Department and inculcate these practices in all 
acquisition programs.
    Mr. Skelton. Dr. Carter, the acquisition workforce is a critical 
element in the management of acquisition--and the IMPROVE Act makes a 
number of recommendations related to the acquisition workforce. Under 
your efficiency initiative, the acquisition workforce is deemed a 
critical area (and exempted from the billet freeze). Beyond just 
increasing hiring for acquisition positions, what internal actions is 
the Department taking to hire and train individuals for the acquisition 
workforce? How will you ensure that the military services don't include 
parts of the acquisition workforce in their ``overhead'' reductions 
undertaken in track (1)?
    Secretary Carter. In addition to improving hiring practices and 
increasing the size of the acquisition workforce, the Department is 
creating more focused acquisition career paths, strengthening 
certification requirements, investing in leadership development, 
assessing workforce competencies and implementing strategies to address 
identified gaps, increasing acquisition training capacity, and 
providing new and improved training at all levels. Components are 
actively using the Defense Acquisition Workforce Development Fund for a 
full spectrum of quality-enhancing workforce initiatives authorized by 
10 U.S.C. 1705.
    DOD efforts to strengthen the acquisition workforce in size and 
quality are key to successful implementation of our acquisition reform 
efforts to improve our buying methods and our buying power. The 
President's FY 2011 budget request provides for continuing the 
Secretary of Defense initiative to grow the acquisition workforce by 
20,000 positions by 2015. Significant progress in hiring and growth 
continues and is being closely monitored by the defense acquisition 
workforce steering board, which is chaired by Dr. Carter, and is 
composed of senior acquisition component and functional leaders.
    Mr. Skelton. Dr. Carter, when you state that the Department is 
cutting 10% of service support contracts, can you please clarify what 
this means? Ten percent of what, and what is the basis for choosing ten 
percent? What analysis is the Department using to determine which 
service support contracts will be eliminated? How will you know you've 
cut the ``right'' contracts?
    Secretary Carter. The Department is focused on reducing its growing 
reliance on support contractors that perform routine, staff support 
functions. These targeted services are a subset of the Department's 
Knowledge Based Services portfolio and align within Advisory and 
Assistance Services (A&AS).
    Examples of targeted support contractors include:

      Contractors that come into a headquarters building (e.g. 
the Pentagon) each day and have a desk, phone number, and computer 
account; and
      Contractors that perform duties such as writing memoranda 
or preparing routine briefings.

    Examples of support contractors not targeted include:

      Contractors that orchestrate range control and monitoring 
at training ranges;
      Contractors that provide highly specialized technical 
assistance for weapons systems; and
      Contractors that provide IT support or maintain 
landscaping.

    In accordance with Section 807 of the FY 08 National Defense 
Authorization Act, DOD submits an annual inventory of services 
contracts to Congress. We admit that this inventory is not sufficiently 
exact for the intended purposes of this 10% reduction. In order to 
implement these reductions accurately and effectively, the Department 
must first establish a more complete accounting of the targeted support 
contractors. A DOD-wide survey of these support contracts is in 
progress. This survey data will not only assist the Department in 
reducing such support by 10% annually during the next three years, it 
will provide the necessary data and management tools to better manage 
this contractor support into the future.
    Mr. Skelton. Dr. Carter, what is the plan going forward for 
involving defense industry in the implementation of the reforms spelled 
out in Dr. Carter's September 14 guidance?
    Secretary Carter. Many of the initiatives in the September 14 
Memorandum to Acquisition Professionals emphasize the Department's own 
business practices--things that we can do directly to provide better 
value to warfighters and taxpayers. We developed that list of 
initiatives through intensive internal effort, looking hard at data and 
lessons learned from experience, but we also drew extensively on the 
best ideas submitted by industry. We expect the Efficiency Initiative 
to continue to benefit from communication and cooperation with 
industry. We also understand that some of our recommendations will 
affect (1) our interactions with industry and (2) industry's business 
practices. We specifically want to reward industry for actions that 
increase efficiency and provide real value-added initiatives for the 
Department.
    To make sure industry understands the Initiative's goals and the 
detailed implementation steps, the Department's leadership is holding a 
series of meetings with CEOs and industry leaders. That process began 
immediately after we published the September 14 memorandum. On 
September 16, we held a public event for industry at which we explained 
the initiative and answered questions, and we committed to meet 
individually with defense industry leaders to hear their suggestions 
and their concerns. We have carried out that promise. Additionally, my 
Principal Deputy, the Service Acquisition Executives, the Deputy 
Assistant Secretary for Industrial Policy, and other Department 
executives have held a similar series of meetings. Our goal is to 
maintain an open line of communication that will smooth implementation. 
We want to give industry leaders as clear a signal as possible about 
our plans, and we want to give companies as much opportunity and 
incentive as possible to adapt to the new acquisition environment.
    We also hope to work with industry to stimulate new thinking that 
will lead to follow-on steps to improve the Department's efficiency 
still further. The September 14 memorandum also calls for the Deputy 
Assistant Secretary for Industrial Policy to involve industry further 
in implementing the reforms. Industrial Policy will solicit input from 
the industrial base to discover how DOD requirements of questionable 
utility and inefficient DOD practices cause industry to adopt practices 
that increase non-value-added costs. This input will build on the 
earlier set of industry suggestions and will solicit specific, 
credible, and convincing data on the non-value-added practices and the 
costs that they impose. The Department will then hold a public meeting 
at which industry experts can comment on the best of the suggestions, 
ensuring that those suggestions are broadly relevant to industry. This 
process will lead to follow-on reform proposals as part of the next 
phase of Efficiency Initiative implementation.
    Mr. Skelton. Dr. Carter, what exactly is the intent of your new 
policy on independent research and development?
    Secretary Carter. The intent is to reinvigorate industry's 
independent research and development (IR&D) and protect the defense 
technology base. We are reviewing how we can work with industry to 
identify and eliminate impediments to innovation, provide better 
feedback to industry partners on their IR&D investments, and better 
define the Department's needs to our industry partners. Open 
communication between industry and the Department should guide 
industry's prioritization of IR&D. Results from initial inquiries 
reveal that the communication between industry and DOD on specific IR&D 
investments is not as strong as it could be as a result of changes made 
during the 1990s to the law governing IR&D processes. I intend to take 
action to improve communication between industry and government to 
better align the purpose of IR&D to actual practice.
    Mr. Skelton. General Cartwright, my understanding is that pursuant 
to section 162 of title 10, United States Code, all forces under the 
jurisdiction of a military department must be assigned to either a 
unified command or a specified command that reports directly to the 
Secretary of Defense. Is this also the Department's understanding of 
this law? Given that today this requirement has been satisfied by the 
fact that all forces in the continental United States are assigned to 
United States Joint Forces Command (JFCOM), what options are being 
considered to achieve this requirement once JFCOM is disestablished?
    Section 162 of title 10, United States Code reads as follows:

    Sec. 162. Combatant commands: assigned forces; chain of command

    (a)   Assignment of forces.

          (1)   Except as provided in paragraph (2), the Secretaries of 
        the military departments shall assign all forces under their 
        jurisdiction to unified and specified combatant commands or to 
        the United States element of the North American Aerospace 
        Defense Command to perform missions assigned to those commands. 
        Such assignments shall be made as directed by the Secretary of 
        Defense, including direction as to the command to which forces 
        are to be assigned. The Secretary of Defense shall ensure that 
        such assignments are consistent with the force structure 
        prescribed by the President for each combatant command.
          (2)   Except as otherwise directed by the Secretary of 
        Defense, forces to be assigned by the Secretaries of the 
        military departments to the combatant commands or to the United 
        States element of the North American Aerospace Defense Command 
        under paragraph (1) do not include forces assigned to carry out 
        functions of the Secretary of a military department listed in 
        sections 3013(b), 5013(b), and 8013(b) of this title [10 USCS 
        Sec. Sec. 3013(b), 5013(b), and 8013(b)] or forces assigned to 
        multinational peacekeeping organizations.
          (3)   A force assigned to a combatant command or to the 
        United States element of the North American Aerospace Defense 
        Command under this section may be transferred from the command 
        to which it is assigned only--

                  (A)   by authority of the Secretary of Defense; and
                  (B)   under procedures prescribed by the Secretary 
                and approved by the President.

          (4)   Except as otherwise directed by the Secretary of 
        Defense, all forces operating within the geographic area 
        assigned to a unified combatant command shall be assigned to, 
        and under the command of, the commander of that command. The 
        preceding sentence applies to forces assigned to a specified 
        combatant command only as prescribed by the Secretary of 
        Defense.

    (b)   Chain of command. Unless otherwise directed by the President, 
the chain of command to a unified or specified combatant command runs--

          (1)   from the President to the Secretary of Defense; and
          (2)   from the Secretary of Defense to the commander of the 
        combatant command.

    General Cartwright. Section 162 of title 10, United States Code, 
provides that the Secretaries of the military departments shall assign 
all forces under their jurisdiction to the combatant commands or to the 
U.S. element of the North American Aerospace Defense Command, as 
directed by the Secretary of Defense, except for those forces assigned 
to carry out the functions of the Secretary of a military department 
listed in sections 3013, 5013, and 8013 of title 10 or forces assigned 
to multinational peacekeeping organizations. The Department of Defense 
is considering how best to effect the reassignment of those forces 
currently assigned to United States Joint Forces Command if the 
President disestablishes that Command.
    Mr. Skelton. General Cartwright, in the past, Congress has found it 
necessary to compel the Department to more aggressively pursue 
jointness, most notably in the Goldwater-Nichols Act. If United States 
Joint Forces Command (JFCOM) is eliminated, who within the Department 
will have as their central mission the job to advocate, develop, and 
disseminate joint operating concepts, doctrine, and training? Without a 
central advocate for jointness, and considering that the CJCS and VCJCS 
already have full time jobs, how can the Congress be assured that the 
Department won't default to service-centric approaches?
    General Cartwright. Since Goldwater-Nichols passed in 1986, the 
Department of Defense, including Services and Combatant Commands, has 
diligently pursued jointness. The U.S. Joint Forces Command (JFCOM) was 
established to standardize training, develop doctrine, deliver Joint 
capabilities, and improve jointness in operations and warfighting. 
JFCOM has been successful in helping define, establish and compel a 
Joint culture throughout the U.S. Military.
    The Secretary's recommendation that the President approve the 
disestablishment of U.S. Joint Forces Command (JFCOM) is based on a 
review of the missions assigned to JFCOM in the Unified Command Plan 
and the determination that these missions can now be accomplished 
effectively and more efficiently elsewhere within the Department.
    Fundamentally, the principal purpose for the creation of JFCOM in 
1999--to force a reluctant service-centric military culture to embrace 
joint operations and doctrine--has largely been achieved. Jointness is 
a cultural and behavioral principle that is evolutionary and not easily 
measured; however, there is little debate that today the United States 
military has doctrinally, operationally and culturally embraced 
jointness as a matter of practice and necessity. The on-going 
assessment of JFCOM's functions will identify those functions which 
should be sustained, and will recommend the appropriate level and 
location of leadership.
                                 ______
                                 
                 QUESTIONS SUBMITTED BY MR. THORNBERRY

    Mr. Thornberry. Deputy Secretary Lynn, in your statement you said, 
``The department is seeking ideas, suggestions and proposals regarding 
efficiencies from outside normal channels. We have solicited input from 
experts, from think tanks, from industry and from the department's 
external boards . . . The department is willing to consider any 
reasonable suggestion to reduce our overhead.'' Military mail has long 
been identified as a non-core function of the Defense Department and is 
resource-intensive. A 2005 Defense Business Board (DBB) report strongly 
recommended outsourcing military mail. Major identifiable cost factors 
for military mail include Second Destination Transportation costs, air 
and surface transportation costs, air terminal facilities and personnel 
costs, APO/FPO facilities and personnel costs, Official Mail Center 
facilities and personnel, and unit mail clerks. Potential savings of 
outsourcing military mail are estimated in the hundreds of millions per 
year. Have you and/or will you consider outsourcing military mail as a 
reasonable suggestion to reduce overhead? If you have not, why not?
    Secretary Lynn. Not only has the Department considered outsourcing 
mail functions, we have progressively outsourced military mail 
services. After the 2005 Defense Business Board (DBB) report and a 2007 
OSD directive to outsource mail services, the Military Departments 
outsourced positions at APOs/FPOs, mail terminal facilities and 
official mail centers that resulted in an estimated annual savings to 
DOD of approximately $60 million from FY 2005 to FY 2009. Military and 
DOD civilian postal personnel are still required to: perform postal 
jobs that are inherently governmental; serve as on-site postmasters at 
APOs/FPOs in accordance with United States Postal Service (USPS) 
policy; serve as contracting officer technical representatives; provide 
postal support for theater-opening contingency operations; provide 
direct support for rapid, episodic deployments; and provide support at 
forward operating bases and other dangerous, austere locations.
    In July 2009, the USPS completed contracts for deregulated, 
international commercial air movement of mail resulting in a $34 
million transportation savings for DOD during the first year. On 
September 29, members of the Office of Assistant Secretary of Defense 
for Logistics and Materiel Readiness and the Military Postal Service 
Agency briefed the DBB on these and other outsourcing and efficiency 
efforts made throughout the mail enterprise since their report in 2005. 
In accordance with DOD policy, the Department continues to civilianize 
and outsource mail functions, streamline the mail transportation 
network, and consolidate/align mail facilities to reduce operating 
costs and return personnel to warfighting functions.
    Mr. Thornberry. Dr. Carter, in your statement you said, ``The 
Pentagon awarded $55 billion in contracts that were supposed to be 
competitive, but for which only one bid was received, usually from an 
incumbent.'' Recently the Air Force issued pre-solicitation notices 
seeking input from private industry for technical solutions for a 
proposed counterinsurgency, ISR, and light attack aircraft. The 
requirements outlined were overly proscriptive in technical details 
rather than capability. As a result, an innovative crop-dusting company 
in Olney, Texas, which has developed the AT-802U for counterinsurgency, 
ISR, and light attack purposed for the U.S. military, was unable to 
even bid. It appears that the Department wrote the requirements with an 
incumbent and their preferred solution model in mind. How do you plan 
to address technical requirements written so narrowly as to exclude 
innovative, non-traditional, and relatively unknown entrants to the 
defense industrial base? How do you plan to avoid developing 
requirements that may inadvertently endorse an incumbent's preferred 
solution?
    Secretary Carter. Competition is the cornerstone of the acquisition 
process and its benefits are well understood. To that end, we make 
every effort to avoid overly prescriptive technical specifications that 
hamper competition. In accordance with the requirements of the Federal 
Acquisition Regulation, contracting activities are to employ market 
research before developing requirements documents for an acquisition 
and before soliciting offers to determine what sources are available to 
meet the agency's requirements. Market research is also used to 
identify the capabilities of small businesses and new entrants into the 
marketplace. Contracting offices also use draft Request for Proposals 
and industry days to obtain industry feedback on the technical 
requirements and other aspects of solicitations. All of this is in 
support of ensuring maximum competition for our requirements.
    The Under Secretary of Defense (Acquisition, Technology & 
Logistics) in his September 14, 2010 memorandum ``Better Buying Power: 
Guidance for Obtaining Greater Efficiency and Productivity in Defense 
Spending'' underscored the importance of competition and removing 
barriers to competition that often result in only one offer.
    Mr. Thornberry. General Cartwright, in your statement you said, 
``At all the COCOMs, we must consolidate functions where appropriate 
and where functions are retained, move toward a construct of combined 
joint interagency task force organizations and centers.'' Because 
strategic communication is an inherently interagency problem and 
because the need for addressing strategic communication considerations 
are required both in the development and execution of policy, would you 
consider establishing mission-focused Joint or Combined Joint 
Interagency Task Forces for strategic communication within the 
combatant commands for U.S. missions in Iraq, Afghanistan, and 
elsewhere to be of value? If not, what would you recommend to 
organizationally better address the strategic communication issue? What 
roadblocks to establishing such organizations do you foresee? Does the 
Department have the authority to establish such organizations under 
existing authority or is legislative change required to overcome these 
roadblocks?
    General Cartwright. There is substantial consensus within the 
Department that strategic communication (SC) is a process by which we 
integrate and coordinate, rather than a collection of capabilities and 
activities. The process is an enabling function that guides and informs 
our decisions. Conceptualizing SC as a process allows the Department to 
focus on ensuring effective coordination among components, and to 
identify needed supporting capabilities, rather than designing and 
resourcing new structures and organizations. The SC process supports 
appropriate coordinating mechanisms at the combatant command level. 
But, rather than establishing new structures and organizations, SC 
leverages existing interagency organizations and capabilities to 
minimize bureaucratic layers and competition for limited resources.
    As referenced in the 2009 Report to the President on a National 
Framework for Strategic Communication and DOD's Fiscal Year 2009 Report 
on Strategic Communication to congressional defense committees, in 
response to Section 1055(b) of the Duncan Hunter National Defense 
Authorization Act for FY2009, interagency task forces and coordinating 
bodies needed to address SC considerations currently exist. The 
Combined Joint Interagency Coordination Group (C/JIACG), established at 
each geographic combatant command, coordinates with the United States 
Government civilian agencies to conduct operational planning. Though 
the name of the organization has changed with the addition of coalition 
partners, it has worked and is working today in the Afghanistan and 
Iraq theaters. The C/JIACG can be leveraged to serve as a resource for 
military planners seeking information and input from communication 
practitioners in theater or at the national level. Furthermore, the DOD 
Global Engagement Strategy Coordination Committee (GESCC) is the 
Department's central body for facilitating the SC integrating process. 
GESCC representatives participate in the National Security Council's 
regular interagency policy committee meetings on SC and global 
engagement and also work closely with the Department of State's Global 
Strategic Engagement Center. Accordingly, the Department sees no need 
to establish new task forces or coordinating bodies as they either 
currently exist for the purpose of fulfilling interagency SC 
considerations or, as in the case of the C/JIACG, can be leveraged to 
support operations in Iraq, Afghanistan, and elsewhere.
                                 ______
                                 
                  QUESTIONS SUBMITTED BY MR. GARAMENDI

    Mr. Garamendi. Dr. Carter, what is the status of the acquisition 
program developing an Improvised Explosive Device (IED) detector that 
replicates the smelling sense of a canine?
    Secretary Carter. This question references DARPA's basic research 
program, RealNose. The RealNose goal is to model, design, and develop a 
novel sensor inspired by the canine's olfactory system to include: air/
odor intake, a detector layer (which includes olfactory receptors), a 
signal transduction methodology, and a signal processing/pattern 
recognition methodology for the accurate detection and identification 
of known and unknown chemicals and mixtures of chemicals (i.e. 
explosives, chemical and biological weapons). The key to the program 
concept is simulating the entire mammalian olfactory system (from air 
intake to pattern recognition) to demonstrate canine-comparable 
specificity, distance and detection thresholds.
    The program is currently working in Phase 1A. Performers in Phase 1 
developed breadboard device system-level designs but were unable to 
demonstrate the ability to detect five individual chemical odors (out 
of ten potential) at the canine level of detection for each molecule, 
and at a probability of detection greater than or equal to 80 percent. 
Stabilization of olfactory receptor proteins for use in a device became 
a significant challenge that all three performers were unable to 
overcome in Phase 1. Therefore, the goal of Phase 1A is to optimize the 
sequence of olfactory receptors to augment stability, allowing for 
consistent and reliable detection of odorants at room temperature for 
greater than 48 hours. At the end of this phase, the PM will assess 
whether the program is ready to proceed to Phase II.
    Mr. Garamendi. Dr. Carter, how much has been spent on this 
initiative?
    Secretary Carter. $22.6 million from FY 2008 to FY 2010.
    Mr. Garamendi. Dr. Carter, what cost-benefit analysis has gone into 
determining the efficiency of this initiative vice procuring more 
canines, personnel, and associated equipment?
    Secretary Carter. For IEDs, there is not an applicable cost/benefit 
analysis in using canines. Canines are a great detector but only for 
TNT/DNT, not for homemade explosives or IEDs utilizing other materials. 
Operators must carry multiple detectors to detect explosives and 
chemicals. They must also use an alternate lab-based sensor(s) to 
identify threats.
    Mr. Garamendi. Dr. Carter, is this initiative in-line with your 
guidance on gaining efficiencies through the acquisition reform? If 
yes, how?
    Secretary Carter. As part of the overall DARPA S&T portfolio, all 
approved programs are reviewed for efficiency opportunities. RealNose 
will assess the level and utility of the contractor support on the 
program and the technical direction/approach as part of this review.
    Mr. Garamendi. General Cartwright, does the military have adequate 
satellite communication capabilities to meet theater requirements 
concerning intelligence, reconnaissance, and surveillance (ISR)?
    General Cartwright. We have adequate satellite communication 
capabilities to meet current theater ISR requirements. We are procuring 
additional capacity and capability to meet the forecast demand. The 
Wideband Global Satellite (WGS) Communications constellation recently 
deployed its third satellite over western Africa, and we expect the 
fourth and fifth WGS spacecraft to be launched before the end of 2012. 
This will increase the amount of capacity available to our ISR assets, 
as well as other users. At the same time, we are working to ensure that 
all of our reconnaissance platforms are properly equipped with 
terminals that will allow them to use the new WGS network.
    Mr. Garamendi. General Cartwright, do you see an increased 
requirement for satellite communications to be used as a capability for 
protecting troops on the battlefield? What is being done to ensure this 
capability is being developed to meet the dynamic conditions of current 
and future overseas contingency operations?
    General Cartwright. The need for battlefield communications over 
the next ten to fifteen years will continue to increase, and satellites 
will remain a mainstay of the capability mix we'll deploy to support 
our troops in the field. As contingencies erupt around the globe, we 
will need to rapidly surge communications capabilities into a theater, 
then be able to reposition that capability rapidly to meet needs that 
may emerge in other theaters.
    Satellite systems require significant lead time--often as long as a 
decade--to design, build, test, and finally launch. Their lengthy build 
schedules, coupled with complications arising from the repositioning of 
geosynchronous spacecraft, are often incompatible with the need to 
surge capabilities in and out of theater. For these reasons, we will 
look to commercial SATCOM leasing and a deployable aerial 
communications layer to augment the military space communications 
backbone. A recommended capability mix is part of the outcome of an 
expected Analysis of Alternatives (AoA) the Department plans to conduct 
on space communications during fiscal year 2011.
    Mr. Garamendi. General Cartwright, I am told there are issues with 
the services communicating with each other on the battlefield due to 
use of different communications platforms by the Services. What is 
being done to bridge this capability gap, garner efficiencies, and 
ensure a joint effort?
    General Cartwright. The Department has improved the ability for 
Joint forces to communicate by investing in common equipment with 
interoperable technologies. However, we have not yet achieved wideband 
tactical connectivity that enables full implementation of situational 
awareness/information sharing at the tactical edge. Additionally, Joint 
forces continue to rely on Service-specific communications equipment 
and work-around tactics, techniques, and procedures to maintain 
communications with other Joint and coalition forces.
    Although we are able to communicate, challenges still remain and 
greater efficiency can be realized. The Department is addressing these 
and other issues through initiatives such as the Combined Enterprise 
Regional Information Exchange System (CENTRIXS), the Joint Tactical 
Radio System (JTRS) Program, and the Global Information Grid (GIG) 2.0 
construct.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. FORBES

    Mr. Forbes. 1. Is the Department intending to terminate the 
Acquisition and Cross-Servicing Agreement with NATO SACT? If so, what 
are the implications from a diplomatic perspective and the implications 
from a warfighting perspective?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Acquisition and Cross Service Agreement (ACSA) with NATO SACT will 
remain intact and be executed under Joint Staff oversight. The 
Department currently has no plans to terminate the Acquisition and 
Cross-Servicing Agreement with NATO SAC-T.
    Mr. Forbes. 2. Who will manage the Foreign Liaison/Exchange Officer 
agreements that are in place with 19 nations?
    Secretary Lynn, Secretary Carter, and General Cartwright. The new 
Joint Staff Deputy Director J7, Joint and Coalition Warfighting, will 
manage the FLO/Exchange Officer agreements with the 20 countries we 
currently have agreements with. The intent is for remaining elements of 
former JFCOM training, doctrine, lessons learned, and concept 
development entities to maintain those relationships as part of the 
Joint Staff.
    Mr. Forbes. 3. Does the Department of Defense view the National 
Security Strategy as an important document that should, in a broad 
sense, drive our nation's national defense structure?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Department of Defense views the National Security Strategy as a vital 
document that articulates the Commander-in-Chief's national security 
priorities and guidance. The National Security Staff and the Department 
of Defense worked to ensure close coordination between the National 
Security Strategy (NSS) and the 2010 Quadrennial Defense Review (QDR). 
The 2010 QDR report is consistent with President Obama's vision on 
defense issues, including: reforming acquisition; taking care of our 
military personnel and families; strengthening international 
relationships in the face of common challenges; and rebalancing our 
forces to succeed in today's conflicts while preparing for the threats 
of tomorrow.
    Mr. Forbes. 4. What is your plan to ensure that our allies have 
access to joint interoperability doctrine without a combatant command 
to lead them?
    Secretary Lynn, Secretary Carter, and General Cartwright. Part of 
the JFCOM Disestablishment Plan includes the creation of a Joint Staff-
led organization focusing on Joint and Coalition Warfighting, located 
in Hampton Roads, to ensure doctrine and training interoperability with 
allies and coalition partners remain current. A key aspect in 
developing this plan has been to ensure the close relationship with 
NATO ACT is maintained. As such, General Abrial, Supreme Allied 
Commander Transformation (NATO), has been an integral part in the 
development of the new ``to be'' organizations and kept informed on our 
progress. In this new construct, his staff will interact on a day-to-
day basis with the DDJ7 JCW in Suffolk, VA. Additionally, General 
Abrial will now interact with the CJCS and VCJCS on issues involving 
ACT/US interests.
    Mr. Forbes. 5. Why has the Department abandoned a strategy-based 
military construct and instead elected to try and protect our national 
interests with a weaker and wholly illogical budget-based military?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Department has not abandoned a strategy-based defense construct. 
Through the Quadrennial Defense Review and related strategic 
initiatives, the Department has undertaken a thorough assessment of 
ongoing operations and emerging challenges. As demonstrated in the FY 
2010-2012 budgets, the Department is continually improving the balance 
of efforts and resources among current conflicts, preparing for future 
contingencies, and preserving existing advantages.
    Mr. Forbes. 6. Article 5 of the NATO charter states that:
        The Parties agree that an armed attack against one or more of 
        them in Europe ar North America shall be considered an attack 
        against them all and consequently they agree that, if such an 
        armed attack occurs, each of them, in exercise of the right of 
        individual or collective self-defence recognized by Article 51 
        of the Charter of the United Nations, will assist the Party or 
        Parties so attacked by taking forthwith, individually and in 
        concert with the other Parties, such action as it deems 
        necessary, including the use of armed force, to restore and 
        maintain the security of the North Atlantic area. Any such 
        armed attack and all measures taken as a result thereof shall 
        immediately be reported to the Security Council. Such measures 
        shall be terminated when the Security Council has taken the 
        measures necessary to restore and maintain international peace 
        and security.
    On September 11th, 2001, NATO offered, for the first time, 
assistance to the United States. Why is the Department recklessly 
abandoning this partnership?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Department of Defense is not abandoning the NATO Alliance. The 
Department has led the way in creating a 50-nation NATO coalition with 
over 40,000 troops from allied and partner countries united in 
Afghanistan, so that terrorists who threaten us all have no safe haven 
and so that the Afghan people can forge a more hopeful future. At the 
2010 NATO Summit in Lisbon, President Obama reaffirmed our Article 5 
commitment: that an attack on one is an attack on all. To ensure this 
commitment has meaning, the Department of Defense, is leading the 
development of a missile defense capability for NATO territory, the 
phased adaptive approach, to defend against the growing threat from 
ballistic missiles. This new approach to European missile defense will 
be the United States's contribution to this effort and a foundation for 
greater collaboration that will protect all of our allies in Europe as 
well as the United States. We are also leading efforts to improve 
NATO's flexibility, efficiency, and effectiveness to better prepare it 
to counter other new challenges in an uncertain future. For example, 
the Department has led efforts to reform NATO structures and processes 
to better position the Alliance to handle emerging challenges such as 
malicious cyber activities and the proliferation of weapons of mass 
destruction. (This NATO effort is analogous to the Department's plans 
to streamline the U.S. military combatant command structure.) Finally, 
building on our experience with NATO in Afghanistan, the Department 
will continue to support building the NATO partnership beyond the Euro-
Atlantic area that will help make the Alliance a pillar of global 
security.
    A key aspect in developing this plan has been to ensure the close 
relationship with NATO ACT is maintained. As such, General Abrial, 
Supreme Allied Commander Transformation (NATO), has been an integral 
part in the development of the new ``to be'' organizations and kept 
informed on our progress. In this new construct, his staff will 
interact on a day-to-day basis with the DDJ7 JCW in Suffolk, VA. 
Additionally, General Abrial will now interact with the CJCS and VCJCS 
on issues involving ACT/US interests.
    Mr. Forbes. 7. Does the Department now find the research conducted 
under the Cooperative Research and Development Agreements (CRADA) with 
IBM, Northrop Grumman and Old Dominion University not worthy of 
continuation?
    Secretary Lynn, Secretary Carter, and General Cartwright. Like all 
parts of JFCOM, the Cooperative Research and Development Agreements are 
being reviewed and those judged effective and valuable will be retained 
and re-aligned under another appropriate DOD organization.
    Mr. Forbes. 8. What is your cost estimate of the termination of the 
non-indefinite requirement contracts?
    Secretary Lynn, Secretary Carter, and General Cartwright. As of 8 
Feb 2011, JFCOM does not anticipate incurring any contract termination 
costs.
    Mr. Forbes. 9. If you don't have an estimate, how can the 
Department in good conscience recommend the closure of a combatant 
command authorized under 10 US Code 161 without first determining not 
just what the indefinite contract cost may be, but the whole cost?
    Secretary Lynn, Secretary Carter, and General Cartwright. See 
response to #8 above.
    Mr. Forbes. 10. What is your estimate for the closure of the 
Suffolk and L'Enfant facilities with regards to termination of the 
leases and disposal of the buildings and material?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Suffolk facility lease costs were programmed into the FY12 budget 
submission. The L'Enfant lease will expire without renewal in FY11. 
FY12 will be a transition year during which most facility moves and 
renovations will occur. First order estimate of move/renovation/closure 
costs for Hampton Roads is $25M, and for L'Enfant is $50K. These 
estimates will be refined during a series of Rehearsals of Concept 
during the second and third quarter of FY11. These costs should be 
considered in the context of overall savings.
    Mr. Forbes. 11. If no estimate exists, how can the Department in 
good conscience recommend the closure of a combatant command authorized 
under 10 US Code 161 without first determining not just what the 
indefinite contract cost may be, but the whole cost?
    Secretary Lynn, Secretary Carter, and General Cartwright. See 
response to question #10.
    Mr. Forbes. 12. Does the Department possess a complete listing of 
all applicable Memorandums of Agreement and Understanding to ensure 
that we do not inadvertently violate an agreement opening up the 
government to some level of liability?
    Secretary Lynn, Secretary Carter, and General Cartwright. JFCOM 
continues to compile a comprehensive list of applicable instructions 
and agreements across all functional areas which must be addressed 
during the disestablishment. JFCOM has begun coordination on these 
instructions and agreements. JFCOM has not encountered nor does it 
expect to encounter any violations or difficulties in resolving.
    Mr. Forbes. 13. If there exists no complete list, how can the 
Department close a combatant command without full knowledge of the 
agreements that may be in place and may expose the Department to 
liability if not properly terminated?
    Secretary Lynn, Secretary Carter, and General Cartwright. See 
response to question #12.
    Mr. Forbes. 14. How is the Department planning to deal with the 
high number of displaced federal workers? What is the Department 
planning to do to properly care for those employees who have relied 
upon employment at JFCOM and now, to their detriment, are having their 
livelihood taken from them with little or no notice? What is the 
Department going to do beyond RIF procedures?
    Secretary Lynn, Secretary Carter, and General Cartwright. DOD is 
utilizing its portfolio of outplacement transition programs and tools 
to mitigate any negative impact on affected employees. The Department 
has and will continue to identify employment opportunities within DOD 
through our Priority Placement Program and outside of DOD through the 
Office of Personnel Management's Interagency Career Transition 
Assistance Plan (ICTAP) and Reemployed Priority List (RPL).
    Additionally, the Department is working directly with the impacted 
organizations to provide transition assistance. This type of assistance 
includes resume writing; workshops on transition benefits and 
entitlements; referral to job assistance centers; and instructions on 
how to apply for other federal jobs outside DOD. The Department may 
choose to use workforce shaping tools such as Voluntary Early 
Retirement Authority (VERA) and Voluntary Separation Incentive Pay 
(VSIP) as part of the transition process.
    Mr. Forbes. 15. Deputy Secretary William J. Lynn stated that the 
Department spent ``considerable time reviewing the input of his 
[Secretary Gates] most senior advisors, including the Chairman and Vice 
Chairman of the Joint Staff, myself, and others.'' Why has the 
Department steadfastly refused to provide this input and analysis that 
was developed for and relied upon by the Secretary to make his decision 
despite repeated requests by multiple members of the Virginia 
Delegation?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Department has and continues to provide information to the VA 
Delegation. Secretary Gates met with Governor McDonnell and the 
Virginia Congressional Delegation in order to provide information and 
receive direct input and suggestions before making final decisions on 
the implementation plan for the disestablishment of JFCOM. 
Additionally, the Department has met with Members of the Virginia 
Congressional Delegation, including the Governor of Virginia, and 
provided information both in the form of briefings and documents. 
Finally, General Odierno, JFCOM Commander, and his senior staff have 
been consistently engaged with Governor McDonnell and the Virginia 
Congressional Delegation in an effort to effectively communicate JFCOM 
disestablishment plans and be responsive to additional requests for 
information.
    Mr. Forbes. 16. Please provide the actual (not a summary) of the 
Department's legal opinion with regards to the applicability of Title 
X, 2687 Base Closure and Realignments on the JFCOM closure decision.
    Secretary Lynn, Secretary Carter, and General Cartwright. As 
previously provided on 24 Sep 2010, attached is the Department's legal 
analysis of the applicability of Section 2687 of title 10, United 
States Code. (See page 89 in the Appendix.)
    Mr. Forbes. 17. Numerous documents and statements from DOD have 
indicated that a plan for disestablishment of JFCOM, including a 
determination of the functions that should continue to exist, should be 
eliminated, or should be moved, is being developed over the next 
several weeks. How does DOD justify making a decision to close JFCOM 
before first carrying out such an assessment?
    Secretary Lynn, Secretary Carter, and General Cartwright. As 
discussed in responding to previous questions, the decision to 
recommend the disestablishment of JFCOM was based on improving 
operational effectiveness. JFCOM today is a redundant layer in our 
processes for training joint forces and providing them to the other 
combatant commanders to use operationally. A review of the missions 
assigned to JFCOM in the Unified Command Plan (UCP) showed that JFCOM 
functions could be carried out by other organizations within the 
Department. Determining precisely which functions will go where does 
not affect the fundamental rationale for the decision. Since the 
Secretary's decision, the JFCOM Transition Planning Team has 
systematically reviewed all JFCOM functions and identified those 
functions that should be retained and transitioned elsewhere in the 
Department (in whole or part), and as well as those that could be 
eliminated as an efficiency.
    Mr. Forbes. 18. What studies on cost savings has DOD conducted 
concerning the JFCOM closure and contractor reduction? Please provide 
details.
    Secretary Lynn, Secretary Carter, and General Cartwright. The cost-
savings, which are significant, were identified in the detailed JFCOM 
transition planning. Specifically, the original JFCOM resource request 
for FY11 included $988M in funding, 1,545 military personnel, 1,612 
government civilians, and 2,565 Full-time Equivalent (FTE) contractors. 
The transition plan calls for retaining $536M in funding, 1,131 
military personnel, 1,487 government civilians, and 580 FTE contractors 
for FY 11. These resources will be re-directed to the organizations 
gaining the former JFCOM functions selected for reassignment.
    The decision to disestablish JFCOM was also based on improving 
military effectiveness by making the force generation and force 
provider process more streamlined by removing layers that are redundant 
or no longer necessary.
    Mr. Forbes. 19. What studies on workload impacts has DOD conducted 
(e.g., what are impacts on JCS of force provider function shift)? 
Provide details.
    Secretary Lynn, Secretary Carter, and General Cartwright. JFCOM 
will prepare a detailed implementation plan in coordination with the 
Joint Staff that addresses workload impacts. The Department plans for 
transition of selected personnel, as appropriate, to accompany the 
shift of functions from JFCOM to other organizations. Specifically, of 
the 5,722 total personnel initially assigned in FY11 to JFCOM, 3,198 
will be reassigned to the organizations gaining former JFCOM functions. 
The majority of these reassigned personnel (more than 1,600) will be 
assigned to the Joint Staff. The remainder of retained personnel will 
be assigned across various other joint organizations. Of the 3,891 
JFCOM personnel originally assigned to the Hampton Roads area, 
approximately 1,900 will remain there after transition is completed.
    Mr. Forbes. 20. Has DOD contacted contractors and civilians to 
determine their intent to move locations if their functions are moved? 
What impact on moving functions, and the servicemembers who receive 
JFCOM training and operations support, could result from the loss of 
these personnel from the workforce? What process was used to identify 
JFCOM for closure and what factors were considered in proposing the 
JFCOM closure? Why was it not done within the QDR completed this 
spring, or as part of a BRAC realignment?
    Secretary Lynn, Secretary Carter, and General Cartwright. No JFCOM 
support contractors or civil servants have been contacted to determine 
their intent to relocate or not relocate. As the contracts for 
relocated functions are modified or new support instruments negotiated, 
the contract company will determine how to position their employee 
assets to perform the task. JFCOM recently hosted a meeting with 
industry representatives to keep them informed of pending changes. 
Additionally, JFCOM is coordinating with agencies from the Commonwealth 
of Virginia as the Governor's office establishes a Workforce Transition 
Center to support JFCOM's disestablishment. There is no major 
anticipated impact to operations support if civil servants or 
contractors do not desire to relocate.
    The Secretary took an unsparing look at the Department to find ways 
to increase the Department's effectiveness especially given the 
likelihood of increased budgetary pressure. The QDR and BRAC 
realignment were not explicitly designed for this purpose. As 
referenced in previous answers, the decision to recommend the 
disestablishment of JFCOM was indeed based on improving operational 
effectiveness. JFCOM today is a redundant layer in our processes for 
training joint forces and providing them to the other combatant 
commanders to use operationally. A review of the missions assigned to 
JFCOM in the Unified Command Plan (UCP) showed that JFCOM functions 
could be carried out by other organizations within the Department.
    Mr. Forbes. 21. What specific legal authority exists for such 
strategic closures outside of BRAC? Jointness and joint 
interoperability give the U.S. military a great strategic advantage. 
How will such important characteristics of the modern military be met 
if JFCOM closes?
    Secretary Lynn, Secretary Carter, and General Cartwright. As 
specified in Section 113(a) of title 10, United States Code, the 
Secretary of Defense `` . . . is the principal assistant to the 
President in all matters relating to the Department of Defense. Subject 
to the direction of the President and to [title 10, United States Code] 
and section 2 of the National Security Act of 1947 (50 U.S.C. 401), he 
has authority, direction, and control over the Department of Defense.'' 
In this capacity the Secretary of Defense is responsible for ensuring 
that the Department of Defense operates efficiently and effectively in 
the performance of its missions. Closures and realignments are often 
necessary to achieve efficient and effective operations. The Secretary 
of Defense has the authority to close and realign military 
installations outside of the BRAC process provided that action does not 
trigger the thresholds established in section 2687, or the action is 
only undertaken after the Department satisfies the procedures set forth 
in that provision.
    The Department has identified JFCOM functions that are essential to 
ensure Joint and Coalition interoperability is maintained and 
sufficient resources are in place to adapt to an evolving threat 
environment. Those retained, essential functions will remain but will 
align under the Joint Staff, Combatant Commands, or the Military 
Departments as appropriate. Some functions may remain in their present 
physical location.
    Mr. Forbes. 22. The modeling and simulation work done at JFCOM is a 
critical low-cost test and evaluation function. How can it be done if 
JFCOM closes?
    Secretary Lynn, Secretary Carter, and General Cartwright. Like all 
parts of JFCOM, the modeling and simulation work has been reviewed and 
those elements judged effective and valuable are being retained and re-
aligned under another appropriate DOD organization. In particular, 
modeling and simulation capabilities are being retained in two areas: 
as part of the support to Joint Training and as part of the Joint 
Concept Development and experimentation process. These capabilities 
will continue to be housed in the Hampton Roads region but will be re-
aligned under the Joint Staff J7 directorate.
    Mr. Forbes. 23. Did OSD review the process and decision made by the 
OSD Headquarters and Support Activities Joint Cross Service Group 
during the 2005 BRAC process that resulted in the recommendation that 
JFCOM continue to exist and should in fact purchase its leased 
facilities? How does DOD reconcile the recommendation to close JFCOM 
with the 2005 BRAC recommendation?
    Secretary Lynn, Secretary Carter, and General Cartwright. These two 
decisions addressed different questions. BRAC was focused on facilities 
and the efficient use of these; the Secretary's recommendation to 
disestablish JFCOM was driven by a review of command organizations and 
the desire to improve operational effectiveness of those organizations.
    The analysis undertaken by the Headquarters and Support Activities 
Joint Cross Service Group during the 2005 BRAC process focused only on 
whether existing Headquarters activities were appropriately located and 
whether the facilities in which they were located met their mission 
requirements. The Headquarters and Support Activities Joint Cross 
Service Group did not examine those organizations on a functional basis 
to determine if those organizations should continue to exist.
    Mr. Forbes. 24. Various personnel at JFCOM have been directed to 
sign nondisclosure agreements relating to the review and closure 
process. Why does the Department not take a transparent review and 
decisionmaking process in this action?
    Secretary Lynn, Secretary Carter, and General Cartwright. JFCOM 
transition planning personnel initially complied with local information 
handling instructions designed to prevent initial pre-decisional and 
wide-ranging discussions from giving rise to premature and inaccurate 
rumors and misunderstandings.
    Mr. Forbes. 25. The Secretary indicated that he authorized the 
services to consider additional closures, and Mr. Hale recently 
indicated that no ``more'' closures would be announced until at least 
February. Is DOD currently considering additional base or function 
closures or realignments that would affect Virginia? If so, what are 
the metrics and process being used in that review?
    Secretary Lynn, Secretary Carter, and General Cartwright. As part 
of our ongoing effort to improve the effectiveness and efficiency of 
the Department, DOD will consider all options in how we perform our 
missions. There are currently no firm recommendations regarding any 
future disestablishments or realignments.
    Mr. Forbes. 26. If the Secretary and the military departments are 
considering additional closures and realignments, does DOD believe that 
another round of the BRAC process is necessary? Have specific locations 
outside of Hampton Roads been identified to host any JFCOM mission that 
will remain intact after the proposed disestablishment of JFCOM?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Department of Defense is not currently seeking authority to undertake 
another round of closures and realignments under the Defense Base 
Closure and Realignment Act of 1990, as amended. The Secretary of 
Defense has asked the Secretaries of the Military Departments to 
examine their organizations for efficiencies. If the Secretaries of the 
Military Departments identify any actions that could involve the 
closure or realignment of a military installation, those actions will 
only be undertaken in accordance with law.
    The vast majority of retained Hampton Roads located functions will 
remain in Hampton Roads. The intent for retained, re-assigned elements 
of JFCOM that are located outside the Hampton Roads area is for them to 
remain in their current locations. This includes: Joint Warfare 
Analysis Center (JWAC) in Dahlgren, VA; Joint Personnel Recovery Agency 
(JPRA) in Ft Belvoir, VA and Spokane, WA; Joint Communications Support 
Element (JCSE) in Tampa, FL; Joint Fires Interoperability and 
Integration Team (JFIIT) at Eglin AFB, FL; and the NATO School in 
Oberammergau, GE.
    Mr. Forbes. 27. Has DOD considered moving a new mission to backfill 
the sudden loss of this Command in the Hampton Roads region? For 
example, has DOD considered moving AFRICOM or other functions to the 
region? Which locations are being considered to host AFRICOM?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Department considered a range of options. That said, the Hampton Roads 
region will be included in any future evaluation of options to relocate 
AFRICOM's headquarters.
    Mr. Forbes. 28. What specific JFCOM functions will remain in 
Suffolk and Norfolk? What are the estimated civilian, uniformed, and 
contract job positions at each location? Are these personnel assigned 
to specific billets at each location?
    Secretary Lynn, Secretary Carter, and General Cartwright. Specific 
functional reconfiguration is on-going and will be codified in a 
detailed Implementation Plan. In general, essential joint force 
providing, joint training, doctrine and concept development, lessons-
learned, command and control integration as well as key Combat Command 
support enablers are planned to remain in Hampton Roads. Approximately 
1,300 military, civilian and contractor positions remain in Suffolk and 
500 remain in Norfolk. Personnel alignment to retained positions will 
continue over the next 6-12 months.
    Mr. Forbes. 29. What is the DOD plan for use of leased space in 
Suffolk? Will the leases be terminated and what are the termination 
fees?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
Department is pursuing both alternative occupants for the vacated 
spaces as well as potential transition from lease arrangements to 
Department ownership of one or more of the Suffolk properties. Lease 
costs programmed into the budget through FY12 allow the Department 
ample opportunity to develop those alternatives and avoid lease 
termination fees.
    Mr. Forbes. 30. If similar functions to JFCOM exist within the 
Joint Chiefs of Staff and other organizations, did DOD consider 
consolidation of those functions to JFCOM, rather than 
disestablishment? Should alternatives, such as expanding or 
strengthening the JFCOM function, have been considered instead of 
selecting the JFCOM closure option?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
decision to recommend the disestablishment of JFCOM was based on 
several factors including improving operational effectiveness by 
eliminating a redundant layer in our command and control processes for 
training joint forces and providing them to the other combatant 
commanders to use operationally.
    Mr. Forbes. 31. For those activities that DOD determines should 
continue to exist, what process will DOD use to determine whether they 
should remain in place or move elsewhere? Was there consideration given 
to simply reducing the number of contractors and eliminating the 
duplication of missions versus eliminating the entire command?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
intent for the vast majority of retained, re-assigned elements of JFCOM 
that are located in Hampton Roads is for them to remain in Hampton 
Roads. Due to the significant investment in supporting technologies and 
workforce, further analysis led to the recommendation for those 
retained functions to remain in the Hampton Roads area. The intent for 
retained, re-assigned elements of JFCOM that are located outside 
Hampton Roads is for them to remain in their current locations due to 
the same business case analysis rationale.
    The decision to recommend the disestablishment of JFCOM was based 
on several factors including improving operational effectiveness by 
eliminating a redundant layer in our command and control processes for 
training joint forces and providing them to the other combatant 
commanders to use operationally.
    Mr. Forbes. 32. Has DOD calculated the extreme economic costs to 
Virginia of the contractor reduction; and what is the estimate? Where 
are the displaced contractor functions going to be performed? Will the 
JFCOM closure make the region eligible for base closure assistance, 
including OEA grants, from the federal government?
    Secretary Lynn, Secretary Carter, and General Cartwright. DOD has 
not calculated costs to local areas of any of the efficiency 
initiatives, including the disestablishment of JFCOM.
    While all sectors of the JFCOM workforce are being scaled back, the 
mission functions that are retained in Virginia will continue to be 
performed by the remaining military, civil servants, and contractors or 
some combination of these workforce groups.
    In January 2011, the Office of Economic Adjustment (OEA) approved a 
$472,180 award to provide economic adjustment assistance to the 
Commonwealth of Virginia in response to the disestablishment of JFCOM. 
(Please note: OEA's program of assistance to Virginia for the 
disestablishment of JFCOM is ``economic adjustment assistance,'' not 
``base closure assistance'' as the question indicates.)
    Mr. Forbes. 33. Will the JFCOM closure result in an increase of 
personnel in the National Capital Region?
    Secretary Lynn, Secretary Carter, and General Cartwright. We do not 
anticipate JFCOM disestablishment will have a discernable impact on the 
National Capital Region workforce numbers.
    Mr. Forbes. 34. What costs, and savings, are associated with the 
use of defense contractor personnel at JFCOM? What costs, and savings, 
are associated with the use of defense contractor personnel in the 
National Capital Region? How will DOD decide which defense contractors 
and contracts to cut or eliminate in order to achieve the announced 
reduction?
    Secretary Lynn, Secretary Carter, and General Cartwright. DOD does 
not inventory contractor personnel or expenditures by geographical 
region. Contractor/contracts that support those missions/functions that 
are redundant will be eliminated. Those that support unique and 
critical missions/functions will be retained.
    JFCOM's FY11 estimated ``historical'' contract cost is $550M in 
active contract instruments and funds obligated, subject to reduction 
as a result of functions ending and transferring and the associated 
ending or scaling of supporting contract instruments.
    Mr. Forbes. 35. What studies has DOD conducted on both the short- 
and long-term real cost savings by reducing the use of defense 
contractors? Please include any existing examples where reducing the 
use of defense contractors--either by using uniformed personnel or by 
insourcing--has actually reduced costs to DOD. If the Department is 
looking for efficiencies, why was the decision made to cut the 
government contracting services sector rather than finding efficiencies 
through the streamlining of administrative operations?
    Secretary Lynn, Secretary Carter, and General Cartwright. The DOD, 
Congress, and GAO have observed a significant increase in the 
Department's spending for contracted services, as evidenced by the 
doubling of the dollars DOD has budgeted/obligated for contracted 
services, to approximately $250B in FY10. While the reduction in 
contracted spending as a result of in-sourcing was $900M in FY10, the 
net growth in contracted services from FY09 to FY10 was still more than 
$5 billion. While in-sourcing decisions may result in savings, in half 
of all decisions to in-source a contracted service to date, cost has 
not been the deciding factor. While at the organizational level, DOD 
components are finding that they can generate savings or efficiencies 
through in-sourcing certain types of previously contracted services or 
functions, these savings are generally not visible at a macro level and 
materialize in the form of resource realignment at the field/command 
level to other priorities or requirements.
    As part of improving the way DOD conducts business, DOD is ensuring 
adequate in-house capability and capacity to perform inherently 
governmental functions, closely associated with inherently governmental 
functions, and other critical work (including increased acquisition 
capabilities and contract oversight and other critical acquisition 
functions that will help mitigate risk, build internal capacity, and 
help meet readiness needs).
    While in-sourcing these critical or necessary services may not 
always generate direct savings, the overall benefits to the taxpayer 
are realized through:
          improved oversight of contracted service performance;
          maximizing use of competitive processes for contracted 
        services;
          improved tradecraft in services acquisition
          implementing more efficient and timely acquisition 
        processes;
          reducing fraud, waste, and abuse;
          improved performance of critical cost-saving acquisition 
        functions to include systems engineering, contracting, cost 
        estimating, test;
          contract pricing.
    A major tenet of the Secretary's Efficiencies Initiative is to 
streamline administrative operations. Sometimes this means eliminating 
associated support that has been obtained by contract. OSD (including 
the defense agencies and field activities) and the Combatant Commands 
conducted a functional review and identified low-priority functions for 
potential elimination as well as other opportunities to lower operating 
costs and improve performance and agility. In addition, the Department 
reduced funding for administrative support services that have 
previously been obtained by contract. The Department recognizes that 
the private sector is, and will continue to be, a vital source of 
expertise, innovation, and support to the Department.
    Mr. Forbes. 36. Upon what basis or analysis was the decision made 
to reduce the use of defense contractors by a total of 30% over the 
next three (3) years? Please provide a copy of any analysis conducted 
by DOD that forms the basis of this action.
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
reduction is in the use of a specific subset of contractors--service 
support contractors. These are contracted personnel that perform staff 
and administrative functions.
    The goal of the Secretary's Efficiencies Initiative is to protect 
current and future operational capability by streamlining overhead 
functions and shifting those savings toward investments in 
capabilities. The functions performed by service support contractors 
typically fall into the category of overhead and therefore should 
either be eliminated or performed by existing government personnel.
    Mr. Forbes. 37. What universe of service will the reduction affect? 
Will it be an across-the-board? If not, which categories of service 
will be targeted?
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
reduction is in the use of a specific subset of contractors--service 
support contractors. These are contracted personnel that perform staff 
and administrative functions.
    As the result of a Department-wide survey that concluded in October 
2010, the Department determined that about $4B was spent on service 
support contracts. This is roughly 3 percent of the value of all 
service contracts. We used this baseline to calculate the 10 percent 
annual reductions.
    Mr. Forbes. 38. Will the reduction in the use of defense 
contractors be spread equally throughout the country or will any such 
reduction be confined to a specific region, such as the National 
Capital Region of Northern Virginia, which appears to be hit extremely 
hard by this decision.
    Secretary Lynn, Secretary Carter, and General Cartwright. The 
reduction applies to all DOD world-wide components and its magnitude 
will be a function of each component's existing use of service support 
contract personnel.
    Mr. Forbes. 39. Please provide a list, by position, of every 
individual involved in any capacity in the JFCOM decision and 
disestablishment that have been required to sign a non-disclosure 
agreement.
    Secretary Lynn, Secretary Carter, and General Cartwright. The non-
disclosure agreement was originally signed by 15 members of the JFCOM 
Disestablishment Transition Planning Team, who did not make final 
decisions affecting the disestablishment of JFCOM or the realignment of 
its functions or workforce.
    Mr. Forbes. 40. Describe in detail in the internal and external 
actions being taken to disestablish JFCOM.
    Secretary Lynn, Secretary Carter, and General Cartwright. A 
detailed implementation plan has been developed to disestablish US 
Joint Force Command along both functional and organizational lines. The 
cornerstones of this plan include:
        1)   Transfer streamlined, relevant joint functions to 
        appropriate DOD entities;
        2)   Revert forces currently assigned to JFCOM back to their 
        appropriate Service;
        3)   Eliminate unnecessary or redundant functions;
    Additional focus is being placed on ensuring the Department 
sustains the momentum and gains in Jointness it has worked so hard to 
achieve since the passage of the Goldwater-Nichols Act, while causing 
no harm to critical interaction with NATO and other multi-national 
partners.
    General Odierno, JFCOM Commander, and his senior staff are 
consistently engaged with Governor McDonnell and the Virginia 
Congressional Delegation in an effort to effectively communicate JFCOM 
disestablishment plans and be responsive to requests for information.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. BISHOP

    Mr. Bishop. Dr. Carter, I have been informed recently that cuts and 
reductions in cruise missile procurement and R&D programs may force 
private industry to disband its design teams with this highly 
specialized expertise. Is the small defense turbo fan engine industrial 
base something that your office has specifically identified as a 
defense industrial base concern?
    Secretary Carter. Yes, the Department has specifically identified 
the small turbo fan industry as an industrial base issue. My Industrial 
Policy office has been actively engaged with this issue over the last 6 
months and is seeking alternative strategies.
    Mr. Bishop. Dr. Carter, what can we expect to see out of your 
office and the DOD in the way of specific actions in the near future to 
address the small turbine engine industrial base concern?
    Secretary Carter. The Military Services are exploring new next 
generation weapons programs that will use small turbo fan engine 
technologies. To ensure these technologies are available, the 
Department is actively considering the realities of the small turbo fan 
industry viability on these new program timelines. DOD is investigating 
ways to bridge these industrial capabilities until they are required.
    Mr. Bishop. Dr. Carter, with Russia and India having announced last 
year that they have jointly fielded a supersonic cruise missile, is it 
wise for this Administration to pull back any further R&D funding for a 
supersonic variant?
    Secretary Carter. As the Department plans its next generation 
systems, DOD needs to perform the appropriate analysis to determine 
which capabilities and associated propulsion technologies will be 
required to meet our future national security requirements and 
establish the investment plans to develop and mature those 
technologies.
                                 ______
                                 
              QUESTION SUBMITTED BY MRS. McMORRIS RODGERS

    Mrs. McMorris Rodgers. I, like many of my colleagues, applaud the 
Department of Defense's proactive approach to reduce unneeded 
bureaucracy, rein in wasteful spending, and I concur with Chairman 
Skelton and Ranking Member McKeon that now is not the time to cut the 
defense budget.
    However, in light of Secretary Gates's announced plans to eliminate 
the U.S. Joint Forces Command, I am concerned the critical mission of 
the Joint Personnel Recovery Agency, a subordinate command of the U.S. 
Joint Forces command, may be adversely affected if reshuffled or 
reassigned to a different outpost.
    Spokane, Washington, has served as the Joint Personnel Recovery 
Agency home since its 1999 inception, to the end, what are the DOD's 
plans with regard to the Joint Personnel Recovery Agency? Does the DOD 
efficiency initiative result in closing the ``White Bluff'' Joint 
Personnel Recovery Agency facility located in Spokane, Washington?
    Secretary Lynn. A review of all U.S. Joint Forces Command (JFCOM) 
functions is ongoing. For functions that will be retained, several 
courses of action are being analyzed with respect to their future 
organizational alignment, location and resources. The disposition of 
the Joint Personnel Recovery Agency will be determined as the JFCOM 
disestablishment plan is completed.
                                 ______
                                 
                   QUESTION SUBMITTED BY MR. CONAWAY

    Mr. Conaway. Secretary Lynn, you indicated in your testimony that 
the elimination of the Business Transformation Agency would not 
negatively impact the Department's ability to improve its business 
processes and prepare for financial audits, and that the savings from 
the elimination of BTA would only be in the form of duplicative staff 
and overhead functions. As we look to ensure that there is no 
degradation of these important functional capabilities currently 
provided by BTA, please identify what, if any, specific non-overhead 
BTA functions/personnel will be eliminated as part of the shutdown. For 
each of these positions, please identify how they are duplicative in 
nature and no longer necessary.
    Secretary Lynn. BTA's mission is to guide transformation of 
business operations throughout the Department and to deliver 
Enterprise-level capabilities aligned to warfighter needs. This mission 
remains valid. However, with the establishment of the position of the 
DCMO as an Under Secretary of Defense-level official in the Office of 
the Secretary of Defense, duplication was created. It was determined 
the benefits provided by BTA could be more effectively realized through 
its disestablishment and incorporation of appropriate functionality 
into the Office of the DCMO. While a number of potential courses of 
action are under consideration, and all aspects of the organization, 
including programs, are under review, elimination of the BTA will meet 
the Secretary's guidance to eliminate redundancy and reduce cost.
    Efficiency will be found through elimination of overhead functions 
that, while necessary in a Defense Agency regardless of size, can more 
cost-effectively be provided to the DCMO through existing support 
organizations within the Office of the Secretary of Defense. 
Additionally, organizations that currently exist within the Office of 
the DCMO and BTA, that perform similar or complementary functions will 
be combined and streamlined. This consolidation will enable more agile 
management of Departmental business transformation functions and the 
ability to more effectively carry out the mission. Other functions, 
that were part of BTA, but not directly related to its mission, may 
transfer to other organizations within the Department or be eliminated 
entirely.
    We are still in the process of determining exactly which BTA 
functions/personnel will be eliminated and which will be transferred. 
We expect to have more information on the details of the BTA 
disestablishment by January.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. WITTMAN

    Mr. Wittman. Deputy Secretary Lynn, what quantitative and 
qualitative analysis, and what data, underlie the decision to eliminate 
JFCOM? Please provide the cost/benefit assessments and projected 
savings with regard to keeping or eliminating JFCOM and its functions 
and responsibilities.
    Secretary Lynn. The decision to disestablish JFCOM was based on 
improving operational effectiveness: JFCOM today is a redundant layer 
in our processes for training joint forces and providing them to the 
other combatant commanders to use operationally. The Secretary 
considered a detailed breakdown of JFCOM's UCP missions and how they 
are executed within DOD including interactions between JFCOM and other 
commands. His examination of the range of functions carried out by 
JFCOM concluded that many are duplicative; some are obsolete or of 
questionable value; and others can be carried out just as effectively 
by other existing DOD organizations.
    Mr. Wittman. Deputy Secretary Lynn, who will insure the progress 
made to date will continue in Joint training, doctrine, capabilities, 
and operations, particularly with regard to assessing Joint lessons 
learned and adapting Joint doctrine, developing integrated joint 
capability solutions, and preparing the Joint force for future threats? 
Will these remain command responsibilities or become staff functions of 
the Chairman, the Services, the COCOM's or some other entity?
    Secretary Lynn. Since Goldwater-Nichols passed in 1986, the 
Department of Defense, including Services and Combatant Commands, has 
diligently pursued jointness. The U.S. Joint Forces Command (JFCOM) was 
established to standardize training, develop doctrine, deliver Joint 
capabilities and improve jointness in operations and warfighting. JFCOM 
has been successful in helping define, establish and compel a Joint 
culture throughout the U.S. Military.
    The Secretary's recommendation that the President approve the 
disestablishment of U.S. Joint Forces Command (JFCOM) is based on a 
review of the missions assigned to JFCOM in the Unified Command Plan 
and the determination that these missions can be accomplished 
effectively and more efficiently, elsewhere within the Department.
    Fundamentally, the principal purpose for the creation of JFCOM in 
1999--to force a reluctant service-centric military culture to embrace 
joint operations and doctrine--has largely been achieved. Jointness is 
a cultural and behavioral principle that is evolutionary and not easily 
measured; however, there is little debate that today the United States 
military has doctrinally, operationally and culturally embraced 
jointness as a matter of practice and necessity. The on-going 
assessment of JFCOM's functions will identify those functions which 
need to endure, and will recommend the appropriate location of former 
JFCOM functions and responsibilities as well as the appropriate level 
of leadership to ensure our joint capabilities are sustained and 
improved upon to meet current and future threats.
    Mr. Wittman. Deputy Secretary Lynn, Allied Command Transformation 
(ACT) and NATO have built strong ties to JFCOM in areas of training, 
capability development, experimentation, and coalition forces 
integration. How will this progress be sustained and which U.S. 
commander and staff will assume counterpart responsibilities to ACT's 
NATO Four-Star commander?
    Secretary Lynn. We will sustain interagency and coalition 
relationships. On September 7, NATO Secretary General stated that ACT 
will remain in Norfolk, VA even if JFCOM is disestablished.
    Mr. Wittman. Deputy Secretary Lynn, in the transfer of JFCOM 
functions to Washington or elsewhere, was the cost of labor, living, 
and operations factored into the analysis particularly in comparison to 
Hampton Roads? For those functions retained and either transferred or 
retained in place, what cost savings factored into the estimates of 
cost savings from JFCOM closure?
    Secretary Lynn. The Secretary did not recommend disestablishing 
JFCOM to save money. His decision was based on improving operational 
effectiveness. JFCOM today is a redundant layer in our processes for 
training joint forces and providing them to the other combatant 
commanders to use operationally. We are still working on a detailed 
implementation plan. Cost savings estimates will not be available until 
a more detailed implementation plan is completed.
    Mr. Wittman. Deputy Secretary Lynn, with the announced intent to 
reduce the growth of Pentagon overhead (support staffs, senior 
positions, staffing layers), how do you foresee organizing and 
supervising JFCOM functions that revert to the Joint Staff without 
significant increase in staff size and space requirements? What 
statutory authorities will you be requesting to increase the size of 
the Joint Staff?
    Secretary Lynn. A review of the functions performed by U.S. Joint 
Forces Command (JFCOM), in support of its Unified Command Plan (UCP) 
assigned missions, concluded that several functions are needlessly 
duplicative, while others are obsolete or of questionable value. It was 
also determined that the functions still required to meet UCP missions 
can be accomplished effectively and more efficiently elsewhere within 
the Department.
    These latter functions will be transferred either to the CJCS or to 
a Combatant Commander or Service Chief. To accomplish these transfers, 
there will be a determination of what resources will be required by the 
receiving organization to perform the functions into the future. A 
final decision on the location of these functions and associated 
manpower has not yet been made.
    Mr. Wittman. Deputy Secretary Lynn, are there statutes that prevent 
the CJCS from executing certain functions currently being done by JFCOM 
in support of the COCOMs? Which commander will be assigned the missions 
specifically assigned to JFCOM in the Unified Command Plan IAW the 
provisions of Goldwater-Nichols?
    Secretary Lynn. Chapter 5 of title 10, United States Code, 
addresses the Joint Chiefs of Staff and in particular addresses the 
functions of the Chairman of the Joint Chiefs of Staff. A key 
limitation on assigning functions to the Chairman is that he may not 
exercise military command over the Joint Chiefs of Staff or any of the 
armed forces (10 U.S.C. 152(c)). In addition, the Chairman may neither 
organize nor use the Joint Staff, which is under the authority, 
direction and control of the Chairman, as an overall Armed Forces 
General Staff nor may the Joint Staff exercise any executive authority 
(10 U.S.C. 155(e)). The Department of Defense is considering how best 
to address the missions currently assigned to United States Joint 
Forces Command by the President in the Unified Command Plan, if the 
President disestablishes that Command.

                                  
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