    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

                              [H.A.S.C. No. 112-6]

                                    HEARING

                                       ON

                       NATIONAL DEFENSE AUTHORIZATION ACT

                              FOR FISCAL YEAR 2012

                                      AND

                  OVERSIGHT OF PREVIOUSLY AUTHORIZED PROGRAMS

                                   BEFORE THE

                          COMMITTEE ON ARMED SERVICES

                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                             FULL COMMITTEE HEARING

                                       ON

                 BUDGET REQUEST FROM THE DEPARTMENT OF DEFENSE

                                   __________

                                  HEARING HELD

                               FEBRUARY 16, 2011

    [GRAPHIC] [TIFF OMITTED] CONGRESS.#13

                       HOUSE COMMITTEE ON ARMED SERVICES

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                          One Hundred Twelfth Congress

                HOWARD P. ``BUCK'' McKEON, California, Chairman
    ROSCOE G. BARTLETT, Maryland         ADAM SMITH, Washington
    MAC THORNBERRY, Texas                SILVESTRE REYES, Texas
    WALTER B. JONES, North Carolina      LORETTA SANCHEZ, California
    W. TODD AKIN, Missouri               MIKE McINTYRE, North Carolina
    J. RANDY FORBES, Virginia            ROBERT A. BRADY, Pennsylvania
    JEFF MILLER, Florida                 ROBERT ANDREWS, New Jersey
    JOE WILSON, South Carolina           SUSAN A. DAVIS, California
    FRANK A. LoBIONDO, New Jersey        JAMES R. LANGEVIN, Rhode Island
    MICHAEL TURNER, Ohio                 RICK LARSEN, Washington
    JOHN KLINE, Minnesota                JIM COOPER, Tennessee
    MIKE ROGERS, Alabama                 MADELEINE Z. BORDALLO, Guam
    TRENT FRANKS, Arizona                JOE COURTNEY, Connecticut
    BILL SHUSTER, Pennsylvania           DAVE LOEBSACK, Iowa
    K. MICHAEL CONAWAY, Texas            GABRIELLE GIFFORDS, Arizona
    DOUG LAMBORN, Colorado               NIKI TSONGAS, Massachusetts
    ROB WITTMAN, Virginia                CHELLIE PINGREE, Maine
    DUNCAN HUNTER, California            LARRY KISSELL, North Carolina
    JOHN C. FLEMING, M.D., Louisiana     MARTIN HEINRICH, New Mexico
    MIKE COFFMAN, Colorado               BILL OWENS, New York
    TOM ROONEY, Florida                  JOHN R. GARAMENDI, California
    TODD RUSSELL PLATTS, Pennsylvania    MARK S. CRITZ, Pennsylvania
    SCOTT RIGELL, Virginia               TIM RYAN, Ohio
    CHRIS GIBSON, New York               C.A. DUTCH RUPPERSBERGER, Maryland
    VICKY HARTZLER, Missouri             HANK JOHNSON, Georgia
    JOE HECK, Nevada                     KATHY CASTOR, Florida
    BOBBY SCHILLING, Illinois            BETTY SUTTON, Ohio
    JON RUNYAN, New Jersey               COLLEEN HANABUSA, Hawaii
    AUSTIN SCOTT, Georgia
    TIM GRIFFIN, Arkansas
    STEVEN PALAZZO, Mississippi
    ALLEN B. WEST, Florida
    MARTHA ROBY, Alabama
    MO BROOKS, Alabama
    TODD YOUNG, Indiana
                      Robert L. Simmons II, Staff Director
                   Jenness Simler, Professional Staff Member
                    Michael Casey, Professional Staff Member
                         Megan Howard, Staff Assistant

                                C O N T E N T S

                                  ----------

                         CHRONOLOGICAL LIST OF HEARINGS
                                      2011

                                                                       Page

    Hearing:

    Wednesday, February 16, 2011, Fiscal Year 2012 National Defense
      Authorization Budget Request from the Department of Defense....     1

    Appendix:

    Wednesday, February 16, 2011.....................................    57
                                  ----------

                          WEDNESDAY, FEBRUARY 16, 2011
    FISCAL YEAR 2012 NATIONAL DEFENSE AUTHORIZATION BUDGET REQUEST FROM THE
                             DEPARTMENT OF DEFENSE
                  STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

    McKeon, Hon. Howard P. ``Buck,'' a Representative from
      California, Chairman, Committee on Armed Services..............     1
    Smith, Hon. Adam, a Representative from Washington, Ranking
      Member, Committee on Armed Services............................     2

                                   WITNESSES

    Gates, Hon. Robert M., Secretary of Defense, U.S. Department of
      Defense; accompanied by Robert F. Hale, Under Secretary of
      Defense (Comptroller) and Chief Financial Officer, U.S.
      Department of Defense..........................................     4
    Mullen, ADM Michael G., USN, Chairman, Joint Chiefs of Staff.....     8

                                    APPENDIX

    Prepared Statements:

        Gates, Hon. Robert M.........................................    65
        McKeon, Hon. Howard P. ``Buck''..............................    61
        Mullen, ADM Michael G........................................    75
        Smith, Hon. Adam.............................................    63

    Documents Submitted for the Record:

        [There were no Documents submitted.]

    Witness Responses to Questions Asked During the Hearing:

        [The information was not available at the time of printing.]

    Questions Submitted by Members Post Hearing:

        Mr. Bartlett.................................................   100
        Ms. Bordallo.................................................   104
        Mr. Coffman..................................................   112
        Mr. Conaway..................................................   111
        Mr. Franks...................................................   109
        Mr. Griffin..................................................   112
        Mr. Heinrich.................................................   105
        Mr. Johnson..................................................   108
        Mr. Kline....................................................   108
        Mr. McKeon...................................................    99
        Mr. Miller...................................................   105
        Mr. Palazzo..................................................   112
        Mr. Ruppersberger............................................   106
        Mr. Shuster..................................................   110
        Mr. Smith....................................................    99
        Mr. Smith on behalf of Ms. Giffords..........................   100
        Ms. Sutton...................................................   109
        Mr. Turner...................................................   106
        Mr. Wilson...................................................   106
        Mr. Young....................................................   113

    FISCAL YEAR 2012 NATIONAL DEFENSE AUTHORIZATION BUDGET REQUEST FROM THE
                             DEPARTMENT OF DEFENSE

                                  ----------

                              House of Representatives,
                                   Committee on Armed Services,
                          Washington, DC, Wednesday, February 16, 2011.
        The committee met, pursuant to call, at 10 a.m., in room
    2118, Rayburn House Office Building, Hon. Howard P. ``Buck''
    McKeon (chairman of the committee) presiding.

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

        The Chairman. Good morning, ladies and gentlemen. Thank you
    for joining us today as we consider the President's fiscal year
    2012 budget request for the Department of Defense.
        On Monday I had the opportunity to sit down with Secretary
    Gates to discuss this request. Based on the information I
    received, I am pleased to see that the budget continues to
    support our military men and women fighting in Iraq,
    Afghanistan and elsewhere. The budget provides much needed
    increases in several key areas such as military personnel and
    missile defense.
        I am also pleased that the Department is taking our
    Nation's financial position into account and has identified
    savings from lower priority programs and efficiencies that can
    be reinvested into force structure and modernization. As
    chairman, I, too, am concerned that every dollar be invested in
    core missions of the Department. Now it will be up to us, the
    members of the Armed Services Committee, to take up this
    proposal and scrutinize it with a fine-tooth comb.
        We must ensure that every dollar is spent on the right
    equipment, training and support needed by our troops, their
    families and the Nation's defense. Understandably, there will
    be winners and losers in this process. Tough choices must be
    made, but I will not support initiatives that will leave our
    military less capable and less ready to fight.
        In the request before us, most concerning is the reduction
    of an additional $78 billion from the Department's funding top
    line, including a $13 billion cut in 2012, ultimately leading
    to zero percent real growth in the outyears. Much of this
    savings appears to be generated with the reductions to Army and
    Marine Corps end strength in the 2015 to 2016 timeframe. The
    decision to reduce end strength seems premature given the
    uncertainty in predicting the full range of force and manpower
    requirements in Afghanistan after 2014.
        Furthermore, while some claim the reductions are not
    budget-driven, I note that the savings from these reductions
    were included in the Future Years Defense Plan even before the
    Marine Corps completed its force structure review and before
    the Army had even begun one. Both services have borne the brunt
    of two wars for the past decade, and neither has reached its
    objectives for Active Component dwell time of 1 to 3. I cannot
    in good conscience ask them to do more with less.
        There are additional proposals that immediately warrant
    special scrutiny, like the Expeditionary Fighting Vehicle, for
    which an unfulfilled requirement remains. We must understand in
    greater detail how the Department proposes to address this
    capability gap before we can support abandoning a $4 billion
    investment we have already made.
        On a slightly different note, I would be remiss if I did
    not acknowledge that the new Congress must finish work on
    defense appropriations legislation that was left unfinished in
    the 111th Congress. I have concerns about the implications to
    our troops of funding the Department of Defense at fiscal year
    2010 funding levels in a yearlong continuing resolution [CR].
    Therefore, I am pleased that the House has taken up a defense
    appropriation for fiscal year 2011 this week. While I am
    disappointed there were not higher funding levels for defense
    in this legislation, I support all efforts by this Congress to
    avoid crippling the Department with a continuing resolution.
        I would like to conclude by welcoming our witnesses, the
    Honorable Robert M. Gates, Secretary of Defense; and Admiral
    Michael G. Mullen, Chairman of the Joint Chiefs of Staff.
        I look forward to continuing an open dialogue with you on
    these issues.
        [The prepared statement of Mr. McKeon can be found in the
    Appendix on page 61.]
        The Chairman. Now I will turn to my colleague and good
    friend Ranking Member Smith for his opening statement.

    STATEMENT OF HON. ADAM SMITH, A REPRESENTATIVE FROM WASHINGTON,
              RANKING MEMBER, COMMITTEE ON ARMED SERVICES

        Mr. Smith. Thank you, Mr. Chairman.
        Welcome Admiral Mullen, Secretary Gates, Secretary Hale. I
    appreciate you being here.
        And I want to begin by echoing the chairman's last comment
    there about the need to pass a 2011 defense appropriations
    bill. You all have done an excellent job of explaining to us
    just how hamstrung you are by having to live with the CR for
    the last, I guess it has been, almost 5 months now, the impact
    that has. And I would urge all Members here to talk with folks
    at the Department of Defense to get a full understanding of
    just how that undermines our ability to carry out our national
    security requirements, and how it even reaches over and
    potentially impacts what our troops are doing in Afghanistan
    and Iraq. A critical issue to get an appropriations bill done
    so we are not operating with the CR.
        And on this budget I want to congratulate the Secretary and
    the Department of Defense for again, you know, making sure that
    they provide our troops with the equipment and the support they
    need to do the missions that we all have asked them to do. And
    compliments to this committee as well. Through the years they
    have also stepped up to that task, particularly as the wars in
    Iraq and Afghanistan required much greater speed in meeting
    those needs. This budget, I think, again reflects that top
    priority: Make sure our troops get the equipment and support
    that they need.
        I also feel that this budget does a good job of trying to
    confront the budget realities that we are all aware of. I took
    a very hard and close look at the Department of Defense across
    the board to try to find savings and efficiencies, places where
    we can do better with less money. We absolutely can do that.
        And I think that is the most critical point that I want to
    make. Simply spending money doesn't make us safer. We have to
    make sure that that money is spent well and efficiently, and I
    don't think there is anyone who would disagree, looking back at
    the last 15 years and some of the decisions that have been
    made, with the notion that we can do better, that we can get
    more for the money that we are spending, particularly when you
    look at the acquisition and the procurement process.
        Again, I want to compliment this Secretary of Defense and
    his team for really taking a hard look at some of the lessons
    that we have learned through systems like Future Combat
    Systems, the F-35, other programs that have been more expensive
    than we would have liked. I think we have learned a lot, and I
    think we are moving forward in a very positive direction.
        And we also have to remember, as we look at this budget,
    two other important factors. The defense budget has grown
    enormously: 2001, in current dollars, it was $316 billion; it
    went all the way up to 708-. So we have had enormous growth,
    and we now need to figure out how to manage that.
        And we also need to be mindful of the fact that a strong
    national economy is critical also to our national security. An
    out-of-control deficit jeopardizes that economy. So we have to
    try to make sure that we can live within our means and do the
    job that we all have been asked to do. And I appreciate the
    hard work that has been done on that.
        I want to just add one specific comment before I close.
    That is the importance going forward of stability operations
    and understanding sort of our broad national security
    interests. I think we have learned in Iraq and Afghanistan that
    development programs can be every little bit as important as
    military programs in creating a stable and secure environment
    that protects our interests. And I know the Secretary has
    spoken out strongly about the need not just to have a strong
    military, but also to have a strong State Department and a
    strong whole-of-government approach as we go forward and try to
    figure out some of these stability operations. So I appreciate
    your leadership on that and believe that those two will be
    important issues.
        With that, I look forward to your testimony.
        Thank you, Mr. Chairman.
        The Chairman. Thank you.
        [The prepared statement of Mr. Smith can be found in the
    Appendix on page 63.]
        The Chairman. Before we begin, let me comment that we do
    have a full crowd here today, and I notice there are people out
    in the hallway that would like to be in here, so I would
    request that anyone who disrupts this hearing be removed by the
    Capitol Police. This includes outbursts and holding signs.
        This is a very important hearing and the decorum should be
    maintained, and I would appreciate that that be held that way.
    We will have no--I have a very low tolerance level.
        Let me, Mr. Secretary and Admiral, Chairman, let me thank
    you, to begin with, for your many years of service, both of
    you, to the country, and we all appreciate greatly the efforts
    and the things that you are doing. I know that you are in a
    very, very tough job, and I just want to, at the outset, let
    you know how much every member of this committee appreciates
    your service to the Nation.
        Mr. Secretary.

     STATEMENT OF HON. ROBERT M. GATES, SECRETARY OF DEFENSE, U.S.
      DEPARTMENT OF DEFENSE; ACCOMPANIED BY ROBERT F. HALE, UNDER
    SECRETARY OF DEFENSE (COMPTROLLER) AND CHIEF FINANCIAL OFFICER,
                       U.S. DEPARTMENT OF DEFENSE

        Secretary Gates. Mr. Chairman, Mr. Smith, members of the
    committee--he doesn't get to talk very much anyway.
        Mr. Chairman, Mr. Smith, members of the committee, I would
    like to start with a few words about Congresswoman Giffords,
    who, of course, should be with us today were it not for the
    tragic and senseless attack in Tucson last month.
        I have enjoyed working with Congresswoman Giffords in her
    capacity as a member this committee. She is a strong supporter
    of the national defense and cares deeply about our troops and
    their families, and she has pursued her oversight
    responsibilities with dedication.
        Our thoughts and condolences continue to be with the
    families and victims of that attack. We send our best to the
    Congresswoman's husband, Navy Captain Mark Kelly, for his
    upcoming space shuttle mission and as he helps Mrs. Giffords
    through her recovery. We will miss Representative Giffords'
    contributions today and in the weeks and months ahead, and we,
    in the Department of Defense, wish her a speedy and full
    rehabilitation.
        I appreciate the opportunity to appear before you to
    discuss the President's budget request for the Department of
    Defense for fiscal year 2012, my fifth and final budget
    testimony for the Department of Defense before this committee.
        I want to thank the members of this committee for your
    support of men and women in uniform serving in a time of war. I
    know you join me in doing everything to ensure that they have
    all they need to accomplish their mission and come home safely.
        The budget request for the Department of Defense today
    includes a base budget request of $553 billion and an Overseas
    Contingency Operations request of $117.8 billion. These budget
    decisions took place in the context of a nearly 2-year effort
    by this Department to reduce overhead, cull troubled and excess
    programs, and rein in personnel and contractor costs, all for
    the purpose of preserving the global reach and fighting
    strength of America's military in a time of fiscal stress for
    our country.
        In all, these budget requests, if enacted by Congress, will
    continue our efforts to reform the way the Department does
    business, fund modernization programs needed to prepare for
    future conflicts, reaffirm and strengthen the Nation's
    commitment to care for the All-Volunteer Force, and ensure that
    are our troops and commanders on the front lines have the
    resources and support they need to accomplish their mission.
        My submitted statement includes more details of this
    request, but I want to take this opportunity to address several
    issues that I know have been a subject of debate and concern
    since I announced the outlines of our budget proposal last
    month: First, the serious damage our military will suffer by
    operating under a continuing resolution or receiving a
    significant funding cut during fiscal year 2011; second, the
    recommended termination of the extra engine for the Joint
    Strike Fighter; third, the projected slowing and eventual
    flattening of the growth of the defense budget over the next 5
    years; fourth, the planned future reductions in the size of the
    ground forces; and, fifth, the proposed reform and savings to
    the TRICARE program for working-age retirees.
        I want to start by making it quite clear that the
    Department of Defense will face a crisis if we end up with a
    yearlong continuing resolution or a significant funding cut for
    2011. The President's defense budget request for 2011 was $549
    billion. A full-year continuing resolution would fund the
    Department at about $526 billion, a cut of $23 billion. The
    damage done across the force from such reductions would be
    further magnified as they would come halfway through the fiscal
    year.
        Let me be clear, operating under a yearlong continuing
    resolution or significantly reduced funding, with severe
    shortfalls that entails, would damage procurement and research
    programs, causing delays, rising costs, no new program starts,
    and serious disruptions in the production of some of our most
    high-demand assets, including UAVs [unmanned aerial vehicles].
    Cuts in maintenance could force parts of our aircraft fleet to
    be grounded and delay needed facilities improvements. Cuts in
    operations would mean fewer flying hours, fewer steaming days,
    and cutbacks in training for home-stationed forces, all of
    which directly impacts readiness.
        Similarly, some of the appropriations proposals under
    debate in Congress contemplate reductions of up to $15 billion
    from the President's original fiscal year 2011 request. I
    recognize that given the current political and fiscal
    environment, it is unlikely that the Defense Department will
    receive the full fiscal year 2011 request.
        Based on a number of factors, including policy changes that
    led to lower personnel costs and reduced activity forced by the
    continuing resolution, I believe the Department can get by with
    a lower number. However, it is my judgment that the Department
    of Defense needs an appropriation of at least $540 billion for
    fiscal year 2011 for the U.S. military to properly carry out
    its mission, maintain readiness and prepare for the future.
        At this point I would like to address the ongoing debate
    over the JSF [Joint Strike Fighter] extra engine. As most of
    you know, the President and I, and the previous President and
    his Secretary of Defense, as well as the Department's senior
    military leadership have consistently and firmly expressed our
    opposition to continuing this costly program. We consider it an
    unnecessary and extravagant expense, particularly during a
    period of fiscal contraction. Congress has not spoken with one
    voice on this matter, and the Department has been operating
    this fiscal year under ambiguous guidance at best.
        Under those circumstances, I decided to continue funding
    the JSF extra engine effort on a month-to-month basis. I did
    this not because we had to, but because we chose to give
    Congress the opportunity to resolve this matter as a part of
    its ongoing debate on the budget. However, this also means the
    American taxpayers are spending $28 million a month for an
    excess and unjustified program that is slated for termination.
        The President, the military services and I continue to
    oppose this extra engine, and when the current CR expires, I
    will look at all available legal options to close down this
    program. It would be a waste of nearly $3 billion in a time of
    economic distress, and the money is needed for higher-priority
    defense efforts.
        Which brings me to this proposed $78 billion reduction in
    the defense budget top line over the next 5 years. To begin
    with, this so-called cut is, in fact, to the rate of predicted
    growth. The size of the base defense budget is still projected
    to increase in real inflation-adjusted dollars before
    eventually flattening out over the next 5 years.
        More significantly, as a result of the efficiencies and
    reforms undertaken over the past year, we have protected
    programs that support military people, readiness and
    modernization. These efforts have made it possible for the
    Department to absorb lower projected growth in the defense
    budget without, as Chairman McKeon warned last month, leaving
    our military less capable and less able to fight. In fact, the
    savings identified by the services have allowed our military to
    add some $70 billion toward priority needs and new
    capabilities.
        And of the $78 billion in proposed reductions to the 5-year
    defense budget plan, about $68 billion comes from a combination
    of shedding excess overhead, improving business practices,
    reducing personnel costs, and from changes to economic
    assumptions. So in reality only $10 billion of that 5-year
    total is directly related to military combat capability. Four
    billion of that 10- comes from restructuring the Joint Strike
    Fighter program, a step driven by this program's development
    and testing schedule that would have taken place irrespective
    of the budget top line. And so the rest, about $6 billion out
    of 78-, results from the proposed decrease in the end strength
    of the Army and the Marine Corps starting in fiscal year 2015.
        Just over 4 years ago, one of my first acts as Defense
    Secretary was to increase the permanent end strength of our
    ground forces, the Army by 65,000 for a total of 547,000 and
    the Marine Corps by 27,000 to 202,000. At the time the increase
    was needed to relieve the severe stress on the force from the
    Iraq war as the surge was getting under way. To support the
    later plus-up of troops in Afghanistan, I subsequently
    authorized a temporary further increase in the Army of some
    22,000, an increase always planned to end in fiscal year 2013.
    The objective was to reduce stress on the force, limit and
    eventually end the practice of stop-loss, and to increase troop
    home dwell time.
        As we end the U.S. presence in Iraq this year, according to
    our agreement with the Iraqi Government, the overall deployment
    demands on our force are decreasing significantly. Just 3 years
    ago we had 190,000 troops combined in Iraq and Afghanistan. By
    the end of this calendar year, we expect there to be less than
    100,000 troops deployed in both of the major post-9/11 combat
    theaters, virtually all of those forces in Afghanistan. That is
    why we believe that beginning in fiscal year 2015 the U.S. can,
    with minimal risk, begin reducing Army Active Duty end strength
    by 27,000, and the Marine Corps by somewhere between 15- and
    20,000. These projections assume that the number of troops in
    Afghanistan will be significantly reduced by the end of 2014 in
    accordance with the President's and NATO's [North Atlantic
    Treaty Organization] strategy. If our assumptions prove
    incorrect, or world conditions change for the worse, there is
    plenty of time to adjust the size and schedule of this change.
        It is important to remember that even after the planned
    reductions, the Active Army end strength would continue to be
    larger by nearly 40,000 soldiers than it was when I became
    Defense Secretary 4 years ago. I should also note that these
    reductions are also supported by both the Army and Marine Corps
    leadership.
        Finally, as you know, sharply rising health care costs are
    consuming an ever larger share of this Department's budget,
    growing from $19 billion in 2001 to $52.5 billion in this
    request. Among other reforms, this fiscal year 2012 budget
    includes modest increases to TRICARE enrollment fees, later
    indexed to Medicare premium increases for working-age retirees,
    most of whom are employed while receiving full pensions. All
    six members of the Joint Chiefs of Staff have strongly endorsed
    these and other cost-saving TRICARE reforms in a letter to
    Congress.
        I understand that any change to these kinds of benefits
    prompts vigorous political opposition. But let us be clear, the
    current TRICARE arrangement, one in which fees have not
    increased for 15 years, is simply unsustainable, and, if
    allowed to continue, the Defense Department risks the fate of
    other corporate and government bureaucracies that were
    ultimately crippled by personnel costs, in particular their
    retiree benefit packages.
        All told, the cumulative effect of the Department's savings
    and reforms, combined with a host of new investments, will make
    it possible to protect the military's combat power despite the
    declining rate of growth and eventual flattening of the defense
    budget over the next 5 years.
        As a result of the savings identified and reinvested by the
    services, our military will be able to meet unforeseen
    expenses, refurbish war-worn equipment, buy new ships and
    fighters, begin development of a new long-range bomber, boost
    our cyberwarfare capability, strengthen missile defense, and
    buy more of the most advanced UAVs. But I should note this will
    only be possible if the efficiencies, reforms and savings are
    followed through to completion.
        In closing, I want to address the calls from some quarters
    for deeper cuts in defense spending to address this country's
    fiscal challenges. I would remind them that over the last two
    defense budgets submitted by President Obama, we have curtailed
    or canceled troubled or excess programs that would have cost
    more than $330 billion if seen through to completion.
    Additionally, total defense spending, including war costs, will
    decline further as the U.S. military withdraws from Iraq.
        We still live in a very dangerous and very unstable world.
    Our military must remain strong and agile enough to face a
    diverse range of threats from nonstate actors attempting to
    acquire and use weapons of mass destruction and sophisticated
    missiles to the more traditional threats of other states both
    building up their conventional forces and developing new
    capabilities that target our traditional strengths.
        We shrink from our global security responsibilities at our
    peril. Retrenchment brought about by shortsighted cuts could
    well lead to costlier and more tragic consequences later,
    indeed as they always have in the past. Surely we should learn
    from our national experience since World War I that drastic
    reductions in the size and strength of the U.S. military make
    armed conflict all the more likely, with an unacceptably high
    cost in American blood and treasure.
        Mr. Chairman, I look forward to working through this next
    phase of the President's defense reform effort with you in the
    weeks and months ahead to do what is right for our Armed Forces
    and to do what is right for our country. Thank you.
        The Chairman. Thank you.
        [The prepared statement of Secretary Gates can be found in
    the Appendix on page 65.]
        The Chairman. Mr. Chairman.

    STATEMENT OF ADM MICHAEL G. MULLEN, USN, CHAIRMAN, JOINT CHIEFS
                                OF STAFF

        Admiral Mullen. Thank you, Mr. Chairman, Mr. Smith, and
    distinguished members of this committee. I am honored to appear
    before you today to discuss the President's fiscal year 2012
    defense budget. Before I do, however, let me echo Secretary
    Gates' comments about the very real dangers inherent in failing
    to pass this year's budget.
        The fiscal year 2011 continuing resolution, if carried
    forward, would not only reduce our account by $23 billion, it
    would deprive us of the flexibility we need to support our
    troops and their families. The services have already taken
    disruptive and in some cases irreversible steps to live within
    the confines of the CR, steps that ultimately make us less
    effective at what we are supposed to do for the Nation.
        The Navy did not procure, as planned, a second Virginia
    class submarine by the end of last month, nor was it able to
    buy government-furnished equipment for another Arleigh Burke
    class destroyer. The Army and the Marine Corps have curtailed
    or altogether frozen civilian hiring, and all the services are
    now prevented from issuing contracts for new major military
    construction projects.
        Some programs may take years to recover if the CR is
    extended through the end of September. So I urge you to pass
    the fiscal year 2011 defense bill immediately. Even at a
    reduced top line, it will provide us the tools we need to
    accomplish the bulk of the missions we have been assigned.
        Accomplishing those missions into the future demands as
    well support of the President's fiscal year 2012 proposal. As
    the Secretary laid out, this budget, combined with the
    efficiencies effort he led, provides for the well-being of our
    troops and families, fully funds current operations in
    Afghanistan and Iraq, and helps balance global risk through
    streamlined organization, smarter acquisition and prudent
    modernization.
        The Army, for instance, will cancel procurement of a
    surface-to-air missile in the non-line-of-sight launch system,
    but it will continue production of the Joint Light Tactical
    Vehicle and spearhead the development of a whole new family of
    armored vehicles.
        The Navy will give up its Second Fleet headquarters, reduce
    its manpower ashore, and increase its use of multiyear
    procurement for ships and aircraft, allowing it to continue
    development of the next-generation ballistic missile submarine,
    purchase 40 new F-18s, 4 littoral combat ships and another LPD-
    17.
        The Marines will cancel the Expeditionary Fighting Vehicle
    [EFV] and, like the Army, reduce their end strength starting in
    2015, but they will reinvest the EFV savings to sustain and
    modernize the Amphibious Assault Vehicle and the Light-Armored
    Vehicle, even as they advance a new concept of operations and
    restore much of their naval expeditionary skills.
        And the Air Force will be able to continue development of
    the next tanker, a new bomber, and modernize its aging fleet of
    F-15 fighters, all the while finding savings of more than $33
    billion through reorganization, consolidation and reduced
    facilities requirements.
        None of this balancing will come on the backs of our
    deployed troops. We are asking for more than $84 billion for
    readiness and training, nearly $5 billion for increased ISR
    [intelligence, surveillance, and reconnaissance] capabilities,
    and more than $10 billion to recapitalize our rotary aircraft
    fleet.
        These funds, plus those we are requesting to help build
    partner capacity in places like Afghanistan, Pakistan, Iraq and
    Yemen, all speak to the emphasis we are placing on giving our
    troops and their partners in the field everything they need to
    do the difficult jobs we have asked of them.
        We must also give them and their families everything they
    need to cope with the stress and strain of 10 years at war.
    That is why I am so pleased with the funds devoted in this
    proposal, almost three-quarters as much as the $200 billion
    budgeted for operations and maintenance, to personnel, housing
    and health care issues.
        As you may know, the Chiefs and I penned a rare 24-star
    letter to the Senate Armed Services Committee this week
    expressing our unqualified support for the military health care
    program changes included in this budget. We have sought equity
    across all health care programs, with beneficiaries and health
    care delivery providers having the same benefits as equivalent
    payment systems regardless of where they live or work. That, in
    turn, led us to propose increases in TRICARE enrollment fees
    for working-age retirees. These increases are modest and
    manageable and leave fees well below inflation-adjusted out-of-
    pocket costs set in 1995 when the current fees were
    established. We sincerely hope you will see fit to pass them.
        Please know that we will continue to invest wisely in
    critical care areas to include research; diagnosis and
    treatment of mental health issues and traumatic brain injury;
    enhanced access to health services and new battlefield
    technologies. We understand that changes to health care
    benefits cause concern among the people we serve and the
    communities from which we receive care, but we also understand
    and hold sacred our obligation to care completely for those who
    have borne the brunt of these wars, as well as those for whom
    the war never ends.
        I am convinced that we haven't even begun to understand the
    toll in dollars and in dreams that war extracts from people. As
    the grandsons and granddaughters of the World War II vets still
    struggle to comprehend the full scope of the horror those men
    yet conceal, so, too, will our grandchildren have to come to
    grips with the wounds unseen and the grief unspoken unless, of
    course, we get it right.
        And I believe the investments we are making in wounded care
    and family readiness will pay off in that regard, but it will
    take time and patience and money, three things we seem so
    rarely to possess in this town.
        That brings me back to this particular budget request. With
    limited resources and two wars in progress, we should be
    prudent in defining our priorities, in slaking our thirst for
    more and better systems, and in controlling costs.
        We should also be clear about what the joint force can and
    cannot do, just as we should be clear about what we expect from
    our interagency and our international partners. Our global
    commitments have not shrunk. If anything, they have grown, and
    the world is a lot less predictable now than we could have ever
    imagined. You need look no further than Tahrir Square to see
    the truth in that.
        Foolhardy would it be for us to make hasty judgments about
    the benefits, tangible and intangible, that are about to be
    derived from forging strong military relationships overseas,
    such as the one we enjoy with Egypt. Changes to those
    relationships in either aid or assistance ought to be
    considered only with an abundance of caution and a thorough
    appreciation for the long view, rather than in the flush of
    public passion and the urgency to save a buck. The $1.3 billion
    we provide the Egyptian military each year has helped them
    become the capable, professional force they are, and, in that
    regard, has been of incalculable value.
        Of equal or greater value is increased appropriations for
    the State Department and our request in this budget for
    something called the Global Security Contingency Fund, a 3-year
    pooled fund between the Pentagon and State that will be used to
    build partner capacity, prevent conflicts and prepare for
    emerging threats. The request is modest, an initial $50 million
    appropriation, along with a request for authority to reprogram
    an additional $450 million if needed. But what it will buy us
    is an agile and cost-effective way to better respond to
    unforeseen needs and take advantage of emerging opportunities
    for partners to secure their own territories and regions.
        We must get more efficient, yes, but we also must get more
    pragmatic about the world we live in. We can no longer afford
    bloated programs or unnecessary organizations without
    sacrificing fighting power. And we can no longer afford to put
    off investments in future capabilities or relationships that
    preserve that power across the spectrum of conflicts.
        I have long said we must not be exempt in the Defense
    Department from belt tightening, but in truth there is little
    discretionary about the security we provide our fellow
    citizens. Cuts can reasonably only go so far without hollowing
    the force. In my view, then, this proposed budget builds on the
    balance we started to achieve last year and represents the best
    of both fiscal responsibility and sound national security.
        Now, I don't know what sorts of questions Representative
    Giffords would ask me if she were sitting here today, but I do
    know she wouldn't let me leave until I lauded the incredible
    effort of our troops overseas as they finish one war in Iraq
    and begin to turn corners in Afghanistan. I know you share my
    pride in them and their families, and I know you will keep them
    foremost in mind as you consider the elements of this proposal.
        I thank you for your continued support of our men and women
    in uniform and their families, and I look forward to your
    questions.
        The Chairman. Thank you very much.
        [The prepared statement of Admiral Mullen can be found in
    the Appendix on page 75.]
        The Chairman. Mr. Secretary, Mr. Chairman, as I stated
    earlier, I think everyone on this committee strongly supports
    your request for an appropriation bill that will take care of
    the work that should have been done last year, but if it had
    been done last year by Congress and the administration, we
    wouldn't even be having this argument, this fight, the thing
    that we are trying to resolve right now on the floor.
        So I am hopeful that we can wrap this up just as quickly as
    possible, and I know that all of the defense industry, all of
    the men and women who wear the uniform, and all of your
    colleagues in the Department are strongly behind that, as are
    all of the members on the committee. So I hope we can get that
    done quickly.
        The $78 billion that--you know, that we are talking about
    as a cut, I understand that it is not a cut as we would propose
    something being cut this year from last year's budget. But last
    year, when we were holding these hearings, and you projected
    out the budget for the 5 years, the $78 billion was included in
    it.
        Now, I commend you for what you have asked the services to
    do to find efficiencies and save that $100 billion that they
    will be able to mostly reinvest into more important items going
    forward. And I guess we will continue to talk about the
    outgoing years in outgoing years, but we all understand we are
    in a tough financial situation in the country, and I think we
    all need to work together to make sure that whatever reductions
    in future spending, we all work together to make sure that it
    doesn't cut into our men and women serving in harm's way and
    their families.
        One of the concerns I have had, as we have gone through the
    QDR [Quadrennial Defense Review] and hearings last year and
    this year, it seems to me that the budgets are not driven by so
    much defense needs--or procurement and the things that we are
    talking about spending aren't driven by threat needs, they are
    driven more by budgetary concerns. And as I indicated in my
    opening statement, reductions to the Army and the Marine Corps
    end strength, I can remember when you came, Mr. Secretary, and
    how hard it was to increase the size of the force. And I
    understand that even with these reductions, there still will be
    a larger force than when you became Secretary 4 years ago. But
    as I look around the world and see what is happening, the
    recent events in Egypt, Yemen, Asia and other threats around
    the world, I have great concern about cutting the end strength.
        And so my question is revolving around that. Is a reduction
    in end strength conditions-based? If so, what metrics will the
    Department use to reevaluate this decision going forward? At
    what point will we decide and what measurement will we use to
    decide if this is the correct number to decrease our strength,
    and when will that decision be made?
        What was the 2016 end strength presumed by the QDR and
    during development of the National Military Strategy? And,
    finally, how will this reduction in end strength affect the
    objective of 1-to-3 dwell time for the Active Force?
        Secretary Gates. Let me start and then ask the chairman to
    add in.
        First of all, I would say that it is conditions-based. And
    as I said in my opening statement, if our assumptions about,
    for example, the drawdown in Iraq prove incorrect, then I think
    we will be in a position to change this decision and add to end
    strength further, well before 2015, or at least find other ways
    to deal with the dollar so that there isn't a reduction in end
    strength.
        I would say the key metric is, and the most predictable
    variable is, in fact, the drawdown in Afghanistan. A big
    assumption in this is that we have a very much smaller presence
    in Afghanistan at the end of 2014 than we do now, and I think
    you will know as early as the end of 2012, beginning of 2013
    whether that is going to happen, which allows plenty of time to
    alter these decisions.
        The good thing about this approach is that because you
    don't start to cut anything until 2015, you don't have to go
    out and recruit anybody; all you have to do is find other
    sources of the money. And, you know, what was described to me a
    long time ago about the outyears, the outyears are where
    everybody's dreams come true.
        And so just as an example, when I took this job, the
    forecast, the projected budget for fiscal year 2012 in the 2007
    Bush budget was $519 billion. Our submission is for 553-. So
    these things do change over time, and there is a lot of
    flexibility.
        But I will say this about the Marine Corps. The Marine
    Corps actually came forward with their proposal, and it was
    really unrelated to the budget. Both the previous Commandant
    and the current Commandant believe that when the Marines are
    out of Afghanistan, that the Marine Corps is both too large and
    too heavy to fulfill its traditional missions going forward.
    And so they were talking about reductions in Marine Corps end
    strength a year or two ago, and so that--they tie that very
    much to their mission. And, as I say, we can revisit the
    Army's--you can revisit the Army's end strength depending on
    the conditions in 2013 or 2014.
        Admiral Mullen. Mr. Chairman, all of us in the leadership,
    in leadership positions in the military believe that we live in
    a time of what we call persistent conflicts. It is very
    difficult to know, obviously, what is going to happen in 2015,
    2016 timeframe. But to your point and to the Secretary's
    answer, I think this really is conditions-based per se.
        And in addition to the metric of certainly Afghanistan and
    Iraq, and, you know, we will be in a position there in 2015,
    2016, where our force is substantially reduced, and to include
    in that the 25,000 marines or so who are there now. I would
    just echo what the Secretary said with Jim Conway, who was the
    previous Commandant; Jim Amos, the current Commandant. They had
    been planning to get smaller and lighter. They are too heavy.
    They are the Nation's second land force, which is not what they
    want to be, and they have got to get back to some degree as we
    move ahead to their roots, which is lighter and smaller.
        With respect to the Army in particular, we have looked out
    through the QDR at how many brigades would we have out there.
    And the answer is, we are not sure. We planned around 6 to 10
    or some number like that. We don't know where to look prudently
    at the future as actually the Army has become much more
    expeditionary. And that is where we are headed, and I am very
    comfortable with that.
        Each of the service chiefs--all of us, but each of the
    service chiefs, depending on which service you are talking
    about, some 60 to 70 percent--when you add civilians, direct
    support contractors, 60 to 70 percent of our budget goes to
    people.
        And so and as the Secretary said in his statement, you
    know, we are on a way, on our way of becoming almost
    immobilized by just what it costs in terms of our people. The
    health care piece is just--it is not an insignificant part of
    it, but it is an example. So we have tried to achieve balance.
        Probably the metric I would use is the one you suggested,
    which is dwell time. We are now in this budget, as we look out
    a few years, we will get to about in the 2015 timeframe where
    we are, 1 and 2. I think the Commandant would sit here and say
    that is probably about where he wants to be in terms of
    rotating his force. I think the Chief of the Army would say 1
    and 3. And obviously that will then depend on what the
    obligations will be.
        But you can see now, in various examples, where we have our
    troops home a lot longer than we used to, starting to be
    significantly longer than they were deployed. We are just in
    the beginning of that. We have got to get out to 1 to 2 and
    then in the case look at really decisions around getting to 1
    to 3 with respect to the Army.
        So I am comfortable that we have time, we can look at it.
    And certainly the service chiefs would come in and change their
    recommendation, if you will, based on what I know about them,
    if the conditions warranted it.
        The Chairman. Thank you very much.
        Ranking Member Smith.
        Mr. Smith. Thank you, Mr. Chairman. Actually, I have two
    sets of questions.
        Congresswoman Giffords' staff has submitted to me some
    questions that she has, and I thank both of you for your kind
    words on her behalf. And they focus on Department of Defense
    energy issues, something that Congresswoman Giffords has worked
    a great deal on, and basically using efficiencies and
    alternative to deal with our energy needs and reduce our energy
    consumption.
        She had introduced a bill, the Department of Defense Energy
    Security Act, in 2010. Many of those provisions were contained
    in our fiscal year 2011 NDAA [National Defense Authorization
    Act], and I wanted to follow up on that. And then specifically
    there is a program that the Marine Corps is using at a forward-
    operating base in Afghanistan to use solar as a way to reduce
    their fuel consumption.
        And I think the biggest point here to make is this isn't
    just about saving money or dealing with the energy challenges,
    this also does save lives. And the specific example there is
    that because they used solar, they were able to significantly
    reduce their fuel consumption, as I understand it, from like 20
    gallons a day down to 2.5. And that reduction means that fewer
    convoys have to come and go and bring fuel in, which means that
    fewer people are exposed to the IED [improvised explosive
    device] threat. So there are very specific implications of this
    policy.
        And going forward, I want to know, first of all, how the
    Department of Defense is doing implementing these programs,
    finding efficiencies, reducing our energy consumption through
    the use of efficiencies and alternatives; and then, second of
    all, what more we in Congress legislatively need to do or can
    do to help you.
        And if you could on those two questions, I would like to
    hear some brief comments from you, but submit the answers for
    the record to both Congresswoman Giffords' office and to mine.
    But if you could take a stab at that now, that would be great.
        Admiral Mullen. I think that the example that you actually
    give of the Marines in Afghanistan is a terrific example, and
    it does exactly what you just described. And, actually, Marines
    in Anbar Province several years ago started that, looking at
    the length of their convoys, the number of people that were
    actually put in harm's way because of the logistics and
    transportation requirements. That has kicked in over to the
    Army and actually across all the services.
        So I think the efforts with respect to improving and
    reducing energy dependency are significant. The Secretary stood
    up a very, very strong office to oversee this to both integrate
    the efforts, the investments are there. The Air Force has, from
    my perspective, led the way with respect to synthetic fuel, use
    of synthetic fuels in aircraft. The Navy has picked up on that.
    So there is a significant effort across the board.
        There are green investments taking place in the Marine
    Corps out in Twentynine Palms, for instance, just straight,
    solar energy. The reductions that that base commander is seeing
    are significant as well. That is also starting to be put in
    place in other bases around the country.
        So we are sharing the ideas. We know that we have got to
    reduce our dependence significantly, and the leaders are
    focused on that. We have seen some of the results, but we have
    expectations they will be significantly greater in the future.
        Mr. Smith. I think--Mr. Secretary, go ahead.
        Secretary Gates. I was just going to make two quick
    comments. First I think credit needs to be given particularly
    to the Secretary of the Navy, Ray Mabus, because I think the
    Navy has a really aggressive program in terms of reducing
    energy use.
        Second, I would just note that I read just a few days ago
    that the C-17 was just certified for use of synthetic fuels.
        Mr. Smith. And that is why--just two points in closing on
    this issue before asking another question--is, number one, how
    much difference this can make. I think there is generally in
    the energy field I feel like, well, yes, they are talking about
    this and that and the other thing, but when is it ever going to
    happen? It is happening. And I think the military is out front.
    Every base that I visit, and there are many, they always talk
    about how they are doing this, that, or the other thing on
    energy, and how much they have reduced their energy
    consumption, and how much more efficient it is.
        And then I think the challenge really is to get it to
    scale. As all these experiments are happening, sort of quickly
    find out, okay, here are the three things that just work the
    best. Let us get them servicewide and get them implemented. So
    I think you are making enormous progress then.
        And we thank you, and like I said, if you could submit a
    more detailed answer to Congresswoman Giffords' office and
    mine, that would be great. I would appreciate it.
        Just two quick areas I want to ask about. One, as I
    mentioned in my opening remarks, you know, development
    assistance is becoming a greater part of our national security.
    Stability is the goal here. You know, our enemies now prey on
    ungoverned or ungovernable spaces. They find openings, places.
    It has certainly happened in Afghanistan. It is happening in
    Pakistan, Somalia and Yemen to some extent.
        So figuring out how to do stability is going to be
    critical. And I know of necessity the Department of Defense has
    taken on a lot of responsibility in this area through CERP
    [Commander's Emergency Response Program] funds, through 1206,
    1208. And part of the problem there is these are
    responsibilities better done by, in some cases, the State
    Department or Department of Agriculture or other areas that
    know more about those.
        But you guys have the money, and you have got--you know,
    you were the forward-leading folks. You are out there in the
    field having to figure this out. And, you know, frankly, there
    was not sufficient support elsewhere, so you had to do it.
        The question is how do we begin to transition that
    responsibility, because it is not a core responsibility of the
    military in many instances. It is a core responsibility of
    folks in other agencies. But how do you make that work? How do
    we make sure those other agencies have the support they need?
    How do we transfer the funds? How do you envision that playing
    out?
        Secretary Gates. Well, we have been advocating for much
    greater civilian involvement in these kinds of activities, not
    only in Iraq and Afghanistan, but in global stability
    operations, at least since I gave the Landon Lecture at Kansas
    State in 2007.
        The biggest part of the problem, quite frankly, is
    jurisdictions here on the Hill, and it is the difficulty the
    State Department has in getting their appropriations and
    getting the money they need to do their job.
        If you took every Foreign Service officer in the State
    Department, you would not have a large enough number to crew a
    single aircraft carrier. So finding the resources for the State
    Department--because many of these areas, what we have done is
    worked with you, and you have been very helpful to us in
    developing some work-arounds.
        So on 1206, for example, we have dual-key arrangements. We
    basically leave the initiative up to the State Department in
    terms of what we should do on some of those, and then we fund
    it, and we partner with them. By rights that money should
    probably be in the State Department to start with.
        And so, I think this is an area where legislation, but
    especially appropriations, are really important, because these
    stability operations--and there is a military component to it
    because it is developing partner security capability so that
    they can take care of the security in their own countries so we
    don't have to send American troops to do it.
        And you can just tell from the costs in Iraq and
    Afghanistan the differential in cost between our training
    somebody else to do it and the State Department then providing
    the civilian support in terms of governance and various other
    kinds of assistance compared with having to use U.S. troops. So
    it is a challenge.
        I think we have developed, over the last several years,
    very close working relationships between State and Defense in
    these work-arounds and in these jerry-rigged operations. But a
    long-term solution is the kind of global fund that Admiral
    Mullen was talking about and so on.
        Mr. Smith. Thank you, and you are absolutely right. I mean,
    security has to be a key component of any sort of development
    going forward. You don't have security, you can't do that. And
    I think, you know, the Philippines is an excellent example of
    where a very small number of our forces trained the local
    security forces. And, you know, you don't hear much about what
    is going on in the Philippines, and that is a good thing, and
    then you look at Iraq and Afghanistan, and you can see the
    alternative is just so much more costly, it is beyond
    imagination.
        Just one final comment. When we are trying to figure out
    going forward dealing with the difficult budget environment
    that we have and trying to anticipate threats, you know, trying
    to make sure that we are ready for whatever comes next, I just
    want to make sure that people are aware of the fact that you
    cannot be ready for everything. You know, from my earliest days
    on this committee, one of the things that struck me was every
    day we would come and talk about some threat, and then we would
    talk about how we are not doing enough to be ready for it, and
    I get that.
        But if you were to look out at the world and imagine every
    possible threat and say the job of this committee, or your job,
    is to make sure that we spend enough money to be ready for any
    and all contingencies, the defense budget--well, it might not
    be infinite, but it would be darn close. So we have to
    prioritize those threats going forward with the budget, and we
    can't walk too far down the road that if we can imagine a
    threat, we have to spend whatever we possibly can to make sure
    that we are protected against it, because that sinks us in a
    different way.
        We really have to prioritize. And towards that end I think
    that the key going forward to get the right budget is to really
    look at the requirements. I mean, it starts with the QDR. Once
    we decide that there is a requirement, we then have to fund it.
    If we don't fund it, we are not giving our troops the support
    that they need to do the job that we, by definition, have asked
    them to do.
        But I would like to think that we can also go back to the
    start of that process, not just the end, not just the end, and
    say, gosh, we have to fund this; but go back to the start and
    say, well, is that really a requirement, or is that something
    we developed 10 or 15 years ago that is no longer appropriate?
    So getting there I think we need to move in that direction.
        Secretary Gates. Let me make just two quick comments about
    that. First of all, if you look back to every time we have
    engaged in a military operation since the Vietnam war, we have
    a perfect record. Six months to a year before we engaged in
    that operation, nobody had any idea we were going to do it.
        And so the mantra for the Department that I have tried to
    inculcate is in the current budget environment, we have to be
    exceptionally careful about buying niche capabilities, very
    expensive weapons systems that have application in only one
    scenario. There may be some of those that we need, but we need
    to be extremely judicious about those investments.
        But our overall approach ought to be the broadest--the most
    flexible range of capabilities to cover the broadest range of
    conflict so that, you know, a C-17 is going to be applicable
    whether we are dealing with a near peer or whether we are
    taking aid into Pakistan. So, having capabilities that can form
    many missions is where we need to focus most of our procurement
    dollars for the very reason you cited.
        Admiral Mullen. Sir, can I just make one comment? I think
    one of the ways you do protect against the unknowns is to make
    sure that your S&T [science and technology] and what I would
    call pure R&D [research and development] budgets are both
    comprehensive and broad and not--and sometimes those become
    very easy targets. You need the innovation, you need the kind
    of investment for the capabilities of the future that really
    starts there, and the Secretary has led this.
        There has been a, you know, very focused effort to make
    sure that is sustained. And in the totality of the budget, it
    is not a huge amount of money, but its long-term leverage is
    just, you know, almost off the charts.
        Mr. Smith. Thank you, Mr. Chairman. Thanks to both
    witnesses. You are doing an outstanding job for our country. We
    appreciate it.
        The Chairman. Thank you.
        Mr. Bartlett.
        Mr. Bartlett. Thank you.
        Mr. Secretary, I want to put my comments in context. To the
    best of my knowledge, the only interest in the engine for the
    F-35 in the district I have the honor to represent is an
    interest in the 135. As far as I know there is no interest in
    the 136.
        The Weapon Systems Acquisition Reform Act of 2009 requires
    that you ensure that the acquisition strategy for each major
    defense acquisition program includes measures to ensure
    competition or the option of competition at both the prime
    contract level and the subcontract level of such program
    throughout the life cycle of such program as a means to improve
    contractor performance.
        The current F-35 acquisition strategy states, and I quote,
    ``To preclude excessive reliance on a single engine supplier,
    an alternative engine program was established,'' unquote. The
    F-35 could represent up to 95 percent of the entire U.S.
    fighter fleet in the future. Use of a single engine could
    result in grounding of essentially all of the fighters in all
    of the services.
        The 2010 Hadley-Perry Quadrennial Defense Review Panel
    endorsed dual-procurement competition, and I quote, ``as the
    only way to control program costs.''
        The senior Pentagon procurement official cited competition
    as the cornerstone of defense acquisition. The Pentagon's last
    update of the F-35 alternative engine business case indicated
    the competitive engine is at the break-even point in net
    present value. After having opposed dual-source procurement for
    the littoral combat ship [LCS] as not being, quote, ``real
    competition,'' unquote, the Pentagon signed a dual-source
    procurement contract at the end of last year with the two
    bidders for the LCS.
        Sir, for the past 2 days, two papers have been circulated
    to Congress here, one of them on Monday, one of them on
    Tuesday. They are unsigned and undated. It simply says,
    ``Prepared by the Department of Defense.'' The Office of the
    Secretary of Defense for Legislative Affairs has refused to
    respond over the past 3 days to why these papers are not dated
    or why they were not provided to the Armed Services Committee.
        Sir, when I was a little boy, my mother impressed on me
    that an intent to deceive was the same thing as a lie. In each
    of these papers, there is a statement, the F-136 alternate
    engine is currently 3 to 4 years behind in development compared
    to the current engine program, and yesterday's paper said, and
    the F-136 engine is already 3 to 4 years behind in its
    development phase.
        Sir, the second engine, as you know, was started 4 years
    after the first engine. As you know, the first engine is now
    about 24 months behind in its development. I understand that
    the second engine is just 2 to 3 months behind in its
    development cycle. So in reality, had they both been started at
    the same time, the second engine would now be well ahead of the
    first engine.
        Sir, are you comfortable that these two missiles that have
    gone through Congress for the last couple of days do not
    constitute a violation of the statute that prohibits the
    Pentagon from lobbying Congress?
        Secretary Gates. I am not in the slightest aware of either
    one of those documents. The only document that I am aware of is
    a letter that I sent to Representative Rooney, I think,
    yesterday or the day before, and I can assure you it was both
    signed and dated.
        I will just tell you--well, that was your question.
        Mr. Bartlett. Sir, these two papers are circulated. I will
    have them bring copies down to you. They are unsigned and
    undated, and the Office of the Secretary of Defense for
    Legislative Affairs refused to respond over the last 3 days as
    to why these papers are not signed or why they were not
    provided. They were provided to everybody else in the Congress
    except the Armed Services Committee is my understanding.
        Are you comfortable, sir, that this does not constitute a
    violation of the statute that says that the Pentagon cannot
    lobby Congress?
        Secretary Gates. Let me see the papers and find out the
    background before I make a judgment on them.
        The Chairman. Thank you. After you have a chance to peruse
    those, if you would please respond to the gentleman in writing,
    we would appreciate that.
        [The information referred to was not available at the time
    of printing.]
        The Chairman. Mr. Reyes.
        Mr. Reyes. Thank you, Mr. Chairman.
        Gentlemen, welcome, and thank you for your service.
        Let me add my concern to the issue of the reductions in end
    strength for both the Army and the Marines, given some of the
    challenges that we know we are going to have in the next few
    years in the Horn of Africa and other areas. So I do hope we
    are careful with those reductions, because in the final
    analysis, the ones that pay the price are the service men and
    women and their families. And most recently we have learned
    over the last 8 years in activating and using the Reserve
    forces, a lot of unintended negative consequences impacted
    those families. So I also want to urge caution there.
        The other concern that I have is yesterday it became a
    national story about a lawsuit filed by former veteran women
    that are alleging what I think is a hostile work environment,
    and sexual harassment and other things. I know you are probably
    not in a position to comment on that, Mr. Secretary, but I
    would like to work with your office to better understand
    exactly the circumstances that led to this lawsuit.
        Secretary Gates. If I may, let me just say--and obviously
    what I can say is limited by the fact of the lawsuit, but let
    me just say a couple of things, because this is a matter of
    grave concern, I suspect, to everybody in the room.
        First of all, I have zero tolerance for sexual assault. And
    I worked with Chairman Mullen and the Joint Chiefs and the
    service secretaries to see if we are doing all we can to
    prevent and respond to sexual assaults. I have had multiple
    meetings with the senior leadership of the Department on this
    issue over the past 4 years.
        I have established four critical areas of departmental
    focus: reducing stigma associated with reporting, ensuring
    sufficient commander training, ensuring investigator training
    and resources, and ensuring trial counsel training and
    resourcing.
        We have hired dozen more investigators, field instructors,
    prosecutors and lab examiners. We have spent close to $2
    million over the last 2 years to train our prosecutors so that
    they are better able to be successful. We have expanded the
    Sexual Assault Response Coordinator and Victim Advocates
    tenfold from 300 to 3,000, and we now have those advocates at
    every base and installation in the world, including in Iraq and
    Afghanistan. The court martial percentages have increased from
    30 percent to 52 percent.
        So we are making headway. The fact is we aren't where we
    should be. It is a matter of grave concern, and we will keep
    working at it.
        Mr. Reyes. Yes.
        Admiral Mullen. Sir, I would certainly more than just echo
    what the Secretary said in terms of zero tolerance. This has
    been an issue actually over the course of the last 6 or 7
    years. It has been an issue of great focus. And it is
    unacceptable that we haven't gotten where we need to be on
    this.
        We know this is an extraordinarily difficult issue, and I
    know, both as a former service chief as well as knowing the
    current service chief, it is an area of focus. It wasn't that
    long ago it was a significant area both in the combat zone in
    Iraq. There still is enough anecdotal information coming out of
    both Iraq and particularly in Afghanistan to certainly be of
    concern.
        What the Secretary said in terms of the investments in
    terms of improvements in education, focus on leadership is
    exactly right, but we also have, I think--we still have
    significant work to do, and the leadership is focused on that.
        Mr. Reyes. Thank you.
        Let me just mention quickly two other things. First of all,
    I represent Fort Bliss, who in the area of green energy is
    hoping to be off the grid by the 2015-2016 timeframe. That is a
    huge compliment to the work that you are both supporting in
    terms of alternative energy.
        And then the last thing is I would urge you, Mr. Secretary,
    to work closely with the Secretary of Veterans Affairs to find
    a way to computerize as service men and women come out of
    Active Duty into the Veterans Administration jurisdiction, that
    there be a way of doing a better job through automation.
        Thank you very much. Thank you, Mr. Chairman.
        The Chairman. Thank you.
        Mr. Thornberry.
        Mr. Thornberry. Thank you, Mr. Chairman.
        Mr. Secretary, I thought that the sentence you added
    towards the close of your statement, that retrenchment brought
    about by short-sighted cuts could well lead to costlier, more
    tragic consequences later, indeed as they always have in the
    past, is a very powerful statement to me. I think it is a
    warning to all of us somewhat related to the conversation you
    were having with Mr. Smith about 6 months out, we never know
    what we are about to get into. And I guess it is that feeling
    that really you express better than I could that leads me to be
    concerned about not just end strength, but force structure in
    the future.
        I notice that the independent panel of the QDR, chaired by
    Steve Hadley and former Secretary Perry, with all these people
    you know well on it, expressed their concern about a growing
    gap between our interests and our military capability to
    protect those interests in a complex, challenging security
    environment. That is along the very same lines you were talking
    about with our diverse, complicated, difficult threats. And
    their conclusion was that they believe the current size and
    current end strengths of the Army and Marine Corps should be
    retained.
        And I heard what both of you said, that this is conditions-
    based, and we will see how it goes, and we can change our mind,
    but I am under the impression that the end strength and force
    structure is not something that you can just flip a switch and
    say on/off, that it is the kind of thing that you have got to
    plan ahead for, both in budgets and equipment, in the personnel
    pipeline for training. It is something that has to be planned
    for.
        And so I guess I would appreciate a little more--especially
    since this is, as you say, your last appearance before us--a
    little more of your thoughts about not just end strength, but
    the force structure moving ahead with the kinds of threats that
    at least we understand are on the horizon, failed states,
    trouble in the Middle East, the kinds of stability operations
    that you all were talking about from a financial standpoint.
    But all of that is very manpower-intensive. And so I would
    appreciate your thoughts about how we on this committee can
    best prepare us to deal with those kinds of challenges ahead,
    even if we don't know exactly what they are.
        Secretary Gates. Well, first of all, as I look ahead, I
    think, as I say, and as both the chairman and I have said, the
    end strength that I approved in 2007 for both services will
    remain in place at least until 2015, and those plans could be
    altered depending on circumstances.
        As I look around the world--and we were talking about
    stability operations--one of the areas where we have had a
    significant expansion of capabilities over the last few years
    has been in our Special Operations Forces. And they often play
    the training role that Mr. Smith was talking about in these
    stability operations. And one of the big moves we have made
    that has not been noticed very much is that this increase in
    soft capabilities over the last 2 or 3 years has been moved out
    of the supplementals and into the base budget so that those
    soft capabilities that we will use in a lot of these unstable
    conditions that we look around the world and see will be
    sustained even once we stop getting overseas contingency
    appropriations and so on.
        I will tell you the areas of force structure that worry me
    a lot, and they are areas that this committee in the years to
    come is going to have to address. For example, the number of
    our surface ships, the number--a number of the Navy ships that
    were built during the Reagan years will basically reach the end
    of their planned life in the 2020s. And where the money comes
    from to replace those surface ships or to get to 313, which is
    the Navy's goal from the 287 we have now, I think is going to
    be a challenge. And especially if you put it alongside for the
    Navy acquiring a new ballistic missile submarine for the Air
    Force, is the Air Force, in fact, in 2020 or 2025 going to be
    able to afford a new tanker, an F-35, and a new penetrating
    bomber?
        So there are some tough choices in terms of big
    capabilities that are coming down the road. They are not facing
    us right now, and what we have been able to do is to give
    future Congresses and future Presidents choices because we are
    making investments in things like the SSBN-X [next-generation
    ballistic missile submarine], like the new bomber and so on.
    But down the road when procurement starts, there are going to
    be some very tough decisions that are going to have to be made.
        The Chairman. Thank you.
        Ms. Sanchez.
        Ms. Sanchez. Thank you, Mr. Chairman.
        And thank you, Admiral and Secretary, for being before us
    again today.
        And, Secretary Gates, I just would like to thank you for
    your service because you, obviously serving under two
    Presidents just have been really wonderful to work with. And I
    think so many of us here who have been on this committee for a
    long time really appreciate your candor and your desire to work
    with us to make things better at the Pentagon. So thank you for
    that.
        You know, we find ourselves in two wars, and it has been, I
    don't know--I am losing track--maybe about 8 years. And when
    you are in a time of war, there is always the, you know, fog of
    war, and you want to fund, you want to make sure you win, you
    want to make sure your soldiers and airmen and seamen and
    marines and Coast Guard and all are taken care of and have what
    they need when they are on the front lines. So I think what we
    have seen is really an increase in monies, at least over the 14
    years, now 15 years, that I have been on this committee.
        But, you know, just in January, the Department of Defense
    came out with the report stating that in the past 3 years, the
    Pentagon had awarded $285 billion to companies that were
    defrauding the Pentagon; $285 billion in 3 years. And I know
    when I looked through your budgets, and I have talked to you,
    and we have worked through that you are taking extensive
    initiatives to bring efficiency and savings to the Department.
    And I know we set up the task force with Mr. Andrews on this
    committee to do acquisition in a different manner, and we
    believe that we will find some of this fraud, and we will
    contract in a different way, and we will begin to see some
    savings from that.
        But when something like $285 billion over 3 years occurs,
    it really is working against all the hard work that you and
    others and some in this Congress have done in terms of getting
    rid of the waste in the Department. And what really concerns me
    is that Senator Sanders requested that investigation. If he had
    not, we would have never seen that $285 billion report.
        So my question is, what is in place for the Department of
    Defense to catch those types of things? Were they not in place?
    Do we have new guidelines now that we have seen that that came
    forward? And what can you do, and what can we do together, to
    ensure that these types of companies never get a contract again
    from the Federal Government?
        Secretary Gates. Well, I am not familiar with the study
    that you cite, but I will tell you that there have been a
    number of changes made over the last year or so in terms of our
    approach to acquisition, beginning with the legislation that
    the Congress passed on acquisition reform. The one exception
    that I have made to the freeze on civilian hiring for the next
    5 years in the Department is, in fact, in the acquisition area
    and in hiring professional--building up our own professional
    cadre of acquisition experts. Part of the reason for that is we
    have had too many instances where we have contractors letting
    contracts to contractors instead of people who have the
    interests of the Department of Defense and the U.S. taxpayer at
    heart. So professionalizing our acquisition workforce is a very
    high priority.
        We have really changed a lot in the last year or so in
    terms of our procedures and our processes, first of all, just
    in negotiating smarter contracts, and we have seen some real
    benefits from that. And the example was used in another context
    of the littoral combat ship. Being able to get these two into a
    real competition got the price down far enough that we were
    actually able to buy more ships because of that.
        So I think we have a lot of efforts underway. We have
    thousands of auditors. We have about 10,000 lawyers. And so the
    key is, I think, having the acquisition professionals who can
    discern these bad behaviors and, first of all, prevent them
    from happening in the first place, but then be quicker and more
    effective in catching them.
        Ms. Sanchez. Thank you. My time is over. We will make sure
    we get that Department of Defense report to you so you can take
    a look at that. And I have some other questions, but I will
    submit them for the record because of the time. Thank you, Mr.
    Secretary.
        The Chairman. Thank you.
        Mr. Akin.
        Mr. Akin. Thank you.
        Mr. Secretary, I want to start by saying I really respect
    your decisiveness. Nobody could say that you are afraid to wade
    in and make the tough decisions, and certainly we need that
    kind of leadership.
        I don't always appreciate the communication strategy of
    letting us know. You say that sometimes you don't know for 6
    months before whether you are going to be into a conflict.
    Sometimes we don't know whether a program is going or not, and
    it is a matter of about a day or so that we find out. So
    sometimes on this committee, it would be helpful if you worked
    on the communications and give some of us a heads-up as to what
    you are thinking and where we are going because we are trying
    to play as a team with you.
        Particularly in that regard, I have shifted over, I am now
    on the Budget Committee and trying to help people to understand
    the difference in growth of entitlements and what has happened
    to the defense budget as a percent of GDP [gross domestic
    product]. As you know, the defense budget has gone very much
    down since 1965, and the entitlements are, whatever it is, 6-
    or 700 percent increase. But we need to make the case to make
    sure that you are not so pinched on money that you can't get
    the job done.
        So I hope that you look at us as partners and helpers. If
    you are going to all of a sudden, for instance, going to whack
    the Expeditionary Fighting Vehicle [EFV], which happens to be
    in our committee, it would be helpful to have some idea that
    you are thinking about that as we move from full speed ahead to
    all stop. You know, it is a little helpful to have a heads-up
    on it.
        I was interested to hear you reflect on where you were
    concerned about where we are overall. I also am concerned about
    the number of ships. I had a chance to spend 3 hours in one of
    those situation rooms that was designed to give us a picture
    from ``Hail Britannia, Ruler of the Seas,'' and all through our
    history. And one of the big lessons from that was you fight the
    war with the ships that you have, or at least the ones you have
    on the waves. You can't design a new ship and build it because
    the war will be over by the time you get there.
        My concern was we were talking about a 313-ship Navy. We
    are down to 287, and as you pointed out, when you put the
    ballistic missile submarine or something in there, boy, that
    budget just blows up. So I certainly hope we can work on
    whatever we can do to try to continue on the building.
        The other thing, the Expeditionary Fighting Vehicle, I
    don't really give a rip what particular platforms we have, but
    it seems to be nonnegotiable that marines have to get from the
    ocean to the land, and they have to get there quick enough, and
    not seasick enough, and not full of diesel fumes enough that
    they can actually fight when they get to shore. And I am not
    convinced that we have an adequate strategy without having that
    vehicle or something to fill that gap. So it is something we
    are going to take a look at, but I would hope that you would at
    least allow us to go through that and be flexible with us in
    saying if we don't have a good strategy, let us make sure we
    have a good one, because I think the Brits decided they weren't
    going to do that capability, and then they got in the Falkland
    Island war and just about lost it because they hadn't planned
    to be able to get their marines on the shore.
        So I just wanted to allow you to respond to my rambling
    here a little bit. But we want to work with a team. That is my
    main point with you. But we need a little bit of a heads-up
    before you make your decisive moves. Thank you, sir.
        Secretary Gates. First of all, on the EFV, let me just say
    publicly and for the record, the Department of Defense totally
    supports the Marine Corps in a firm requirement for an
    amphibious assault capability for the Marines. We just don't
    want to spend $15 billion, which is virtually all of the Marine
    Corps' ground vehicle procurement budget, for enough vehicles
    to take 4,000 out of 202,000 Marines from ship to shore.
        Now, I think the Commandant--and it should be clear, this
    was a recommendation from the Commandant to the Secretary of
    the Navy, and from them to me. And I think we should also
    understand the Commandant does have an alternative plan in
    terms of first accelerating the Marine personnel carrier;
    second, upgrading part of the existing amphibious assault
    vehicle fleet; and then third, designing a new assault--
    amphibious assault vehicle, but one without the expensive
    exquisite capabilities of the EFV. So there is a commitment to
    this, and there is money in the fiscal year 2012 budget to
    begin pursuing this.
        And with respect to your first observation, I would just
    say that, first of all, I think that most of the members of
    this committee believe that I have been pretty honest, pretty
    forthcoming, and candid and transparent ever since taking this
    job, and I fully recognize the constitutional role of Congress
    with respect to our military forces. And, in fact, in my first
    commencement address at the Naval Academy, I spoke to the
    midshipmen about that very fact and the importance of Congress
    and for them to stay apolitical, among other things.
        But at the same time, I have to have a disciplined decision
    process inside the Department of Defense. And to tell you the
    truth, until a few years ago, the place leaked like a sieve,
    and I couldn't make an internal decision without it being in
    the newspapers or that process being in the newspapers. And so
    I have tried to instill some discipline in the Department, and
    the truth is that by going out on January 6th with what we have
    in mind for the fiscal year 2012 budget, this committee and its
    counterpart in the Senate got a 6-week head start in evaluating
    the fiscal year 2012 budget over every other committee in
    Congress and every other part of the President's budget. And I
    got the President's approval to go ahead and do that.
        The same thing happened in the spring of 2009 when I came
    up. I made a lot of decisions in the spring of 2009 on
    programs. Thirty-three of them came up here, all of the major
    ones, And in every single one of those, Congress had an
    opportunity to evaluate it and decide whether to go forward or
    not. Right now, 32 of the 33 are in law.
        So I think that I absolutely agree with you, we need to do
    this as a team. But I also have to have a disciplined decision
    process inside the Department of Defense so that I can get
    everybody's point of view, people can speak up in meetings, can
    disagree, and we can work things out before making a decision.
        Mr. Akin. Thank you, Mr. Chairman.
        The Chairman. Mr. Andrews.
        Mr. Andrews. Thank you, Mr. Chairman.
        Thank you, gentlemen, for your service. The highest
    compliment I can pay you is that you reflect the same level of
    excellence of the men and women that you lead, and we
    appreciate all three of your service to our country.
        I apologize for not being personally present for your
    testimony, but I have read it. And, Mr. Secretary, I wanted to
    direct your attention to page 4 of your written testimony,
    which goes into a list of the savings that you are proposing.
        First let me thank you for proposing them. I think too
    often the debate here has been trivialized by people who, I
    think incorrectly, say our military budget is just too large
    because it looks too large without being able to talk about the
    needs the country has, and then others who would look at any
    reduction as somehow a threat to national security without real
    and fair analysis. I cannot think of a person better suited to
    lead us to a mature discussion of this than you, and I thank
    you for taking that leadership role.
        I want to ask you a couple of questions. You talk about $11
    billion over the, I guess, the 5-year window from resetting
    missions, priorities, functions for defense agencies and OSD
    [Office of the Secretary of Defense]. What does that mean more
    specifically?
        Secretary Gates. Let me answer quickly and then ask Mr.
    Hale to elaborate.
        What we have asked every defense agency and every part of
    the Office of the Secretary of Defense to do is to what we call
    rebaseline their activities; just start with a clean sheet of
    paper, what are you doing, what should you be doing, and how
    many people does it take to do that. And so this is one of the
    areas in which we are able to shed staff contractors, in which
    we are able to reduce the number of people that are working in
    these areas. We are consolidating some activities. We are
    eliminating other activities. And so it really has to do on the
    civilian side of the Department how do we make the defense
    agencies and OSD itself more efficient and find savings. So
    that is the basic umbrella.
        Mr. Andrews. If I may, this goes to your premise of your
    earlier arguments, which I understand as being finding ways to
    make more efficient what we do in our logistical operations so
    that we can become more effective in our actual defense
    activities. Is that a fair summary of what you are trying to
    do?
        Secretary Gates. Yes, sir. And the defense agencies have a
    lot of people and a lot of money, and they have grown a lot
    over the last decade. And frankly, we thought that it was time
    to take a fresh look at all of this, and I think it has been a
    long time since anybody has really gone into this in the way we
    have.
        Mr. Andrews. Because I am one who would be eager to try to
    work with you to find more savings in these and other areas.
    And, in fact, I think you will find that there are members of
    both parties willing to do that.
        Secretary Gates. I think there are two areas where we have
    not realized the opportunities that we have. After all, we came
    up with $178 billion worth of structural changes, overhead
    changes, economic changes in the space of about 6 or 8 months.
    There are two areas, for example, where I think we have the
    opportunity to save a great deal more money. One is in
    acquisitions, which we have just been talking about, but in
    negotiating smarter, better contracts. And we have seen this
    already on the SSBN-X, on the LCS, on several different
    programs, on space satellites.
        The other, though, is in information technology. And we
    have got to start on that in this effort, but it is just
    complex enough that we haven't gotten as far as we would like.
        But I think those are just two areas where we could do a
    lot more.
        Mr. Andrews. Many of us, Mr. Secretary, are eager to be
    your partner in that effort.
        I want to thank Secretary Hale in particular for being very
    accessible and very precise whenever we need to speak to him.
        Let me say one thing that I would leave you with that I
    would take some personal responsibility for and hope that some
    of our colleagues would. You have a billion dollars for
    eliminating unnecessary studies and internal reports. A lot of
    them emanate from us. And there is a tendency when we want to
    try to change the law to settle for, well, we will just put a
    provision in and ask the Pentagon to do a report. As someone
    who has violated that rule myself, I would be willing to try to
    not do that in the future and try to urge our colleagues to do
    the same thing.
        Secretary Gates. We will give you some ammunition. From now
    on all reports, whether they are internally commissioned or
    externally commissioned, will on the front page have what it
    costs to prepare the report.
        Mr. Andrews. You should also put the name of the person who
    asked for it.
        Thank you, Mr. Secretary.
        The Chairman. Thank you.
        Mr. Forbes.
        Mr. Forbes. Thank you, Mr. Chairman.
        And, Mr. Secretary, thank you for being here today. And I
    want to just say how much we respect your office. And I hope
    that you won't conclude that it is disrespectful if we try to
    get your answers concise enough to fit into the 5 minutes we
    have, but it is just oftentimes so difficult for many of us, at
    least on this side, to get information from the Department of
    Defense.
        One of the things that we saw on January the 26th when your
    Deputy Secretary Mr. Lynn was here, he testified that the
    Department had failed to comply with the law requiring audited
    financial statements be filed annually in the years 2007, 2008,
    2009, 2010, all years, of course, that you were Secretary of
    Defense. And my first question is, for any of those years,
    2007, 2008, 2009 or 2010, were you unaware that the law
    required that DOD [Department of Defense] file audited
    financial statements?
        Secretary Gates. I certainly did not--was not aware that we
    were in violation of the law.
        Mr. Forbes. So you did not know that you were in violation
    of the law.
        The second question. Mr. Lynn further testified that no
    such statements would be filed this year, but he said that it
    was a priority of the Department of Defense that you get in
    compliance, and that you had a plan to do it. Has that always
    been a priority of yours since you have been Secretary of
    Defense?
        Secretary Gates. Yes, it has. And, in fact, I think if you
    go back to testimony 4 years ago, the person who had the job
    before Mr. Hale had begun the planning and execution of getting
    us to a position where we could comply with the CFO [Chief
    Financial Officer] law----
        Mr. Forbes. Mr. Secretary, if I could--I don't know if we
    have the opportunity to put it up on the screen, but hopefully
    we will, and on the monitors; but if not, there is a chart
    right over here--and there it is. It might be hard to see, but
    you can see this screen over here, and I am wondering if you
    recognize that Web site at all. And the reason I say--just to
    refresh your memory, there is a copy of it here. I know it is
    hard to see. But this is your Web site, and this is live. This
    is not something on the screen that we made a copy of. This is
    what you would have seen at that testimony you are talking
    about in 2007, or if we had done it in 2008, 2009, 2010, or if
    anybody were to go to it today. And it says, this Web site is
    designed to provide all the information you need to understand
    the budget and financial management policy of the Department of
    Defense.
        Mr. Secretary, what it clearly states on there, if we had
    had that testimony then, is that the Department of Defense
    would have been in 100 percent compliance and given 100 percent
    audited financial statements by the year 2010. But in point of
    fact, according to what Mr. Lynn testified, the Department was
    off 100 percent. Is that not accurate in that we have filed no
    audited financial statements?
        Secretary Gates. We certainly have not filed clean audits.
    That is for sure.
        Mr. Forbes. And, Mr. Secretary, the question I would have
    for you is would you authorize--you have been given by the
    taxpayers of this country $2.5 trillion essentially since you
    have been Secretary of Defense. Would you authorize the
    expenditures of these sums if you were not convinced there were
    adequate accounting systems in place to note where they were
    being spent?
        Secretary Gates. Mr. Forbes, I am confident that we have
    the financial processes, all of which were, by the way,
    designed for budgetary planning and which the Congress has
    relied on for a long time, that give me confidence that we know
    where the money is going. Can we do the kind of audits that are
    required by the CFO? No. But we are spending between 200- and
    $300 million a year to get in compliance. We have a short-term
    and a long-term plan to get there, which I would be happy to
    share with the committee.
        So we understand our obligation to get to this, but the
    reality is we do have systems in place to deal with fraud, to
    deal with other issues, and that provide us with the tools to
    do financial management.
        Mr. Forbes. Mr. Secretary, I don't want to cut you off, but
    I only have about 40 seconds left. And the reality is this: You
    were 100 percent off. And I want to be kind, and I want to be
    respectful, but the reality is that taxpayers have entrusted
    your Department with $2.5 trillion. And here is the way we
    basically repay them with the accounting. You call it
    disciplined decisionmaking, but we have issued gag orders to
    stop people from the Pentagon in talking to Members of Congress
    about where those dollars are; didn't get a shipbuilding plan
    in the year it was required by law; didn't get the aviation
    plan in the year it was required by law; haven't had the
    audited financial statements required by law; and the cuts that
    you give us, Mr. Secretary, we only get backfilled information.
        And, Mr. Chairman, I know my time is up, so I will yield
    back.
        The Chairman. Thank you very much.
        Mrs. Davis.
        Mrs. Davis. Thank you, Mr. Chairman.
        And, Secretary Gates and Chairman Mullen, I think we all
    applaud you for your extraordinary service, and I certainly
    want to add my voice as well.
        Since you said, Secretary Gates, that this is your last
    budget, I believe also, Chairman Mullen, is this your last
    budget as well?
        Admiral Mullen. As far as I know.
        Mrs. Davis. Given that, several of my colleagues have asked
    some questions, I think, that have asked you to kind of take
    out of your notes and what is it that concerns you the most,
    whether it is in the budget or outside the budget? And I wonder
    if you could speak just a bit to any disconnect that you see
    between what the needs are and what the budget actually
    reflects? It is a little bit of the ``what keeps you up at
    night'' question, but I would hope that as this is your final,
    if there is anything in particular that you would like to focus
    our attention on that may not have been stated.
        Admiral Mullen. I will take a crack at it. As I look at the
    future, there has been a discussion today about force
    structure, and I worry in the longer run. I think we are okay
    right now, but I worry in the longer run that we align our
    force structure with the national security requirements we have
    as a country. And at some point in time, with the force
    structure we have, we are going to have to start saying there
    is going to be some stuff we are going to need to stop doing.
        I worry about resetting from these wars. And it is going to
    take us--we will get 2 years of dwell time here in the next few
    years, but we are not really reset for 2 years as opposed to
    instantaneously when that starts. And so I worry about properly
    resetting during a time where the challenges in the world
    continue to grow. There is no better example than just the last
    couple of weeks, and I think that will continue. You track
    crises back over the course of the time the Secretary has been
    here and I have been in this job, they continue to grow.
        I am comfortable that we have the best military we have
    ever had, our young men and women, and we just need to make
    sure that we sustain that over the long term.
        We will talk a lot about equipment in these hearings. If we
    get it right for our people and our families, we will be fine;
    and if we don't, it will be a real struggle.
        And then in two specific areas, not that we don't have
    challenges, as have been mentioned, but two specific areas that
    are of great concern to me. One is space, and the other is
    cyber. And those are areas that are what I would call too often
    niche areas. They are not anymore. They are domains without
    boundaries, without rules. We have international players as
    well as individuals, particularly on the cyber side; extremely
    dangerous in both realms, particularly in cyber. We have
    invested in that heavily. We have stood up a command. Those are
    initial steps. We have got a long way to go.
        Mrs. Davis. Mr. Secretary, did you want to respond to that?
        Secretary Gates. Since this is my last hearing, I will be
    bold and tell you two things that worry me, and they both have
    to do with Congress. One is the disconnect between the roles
    and missions that have been given to the military by Congress
    and the President, and the discussion of the defense budget now
    and in the future here on the Hill, where it is treated more
    often than not as a math problem.
        You have 18.9 percent of Federal outlays, which, I might
    add, is the lowest percentage of Federal outlays for defense
    other than the late 1990s, early 2000s, since before World War
    II, and yet because we have a half a trillion dollars, then we
    must be part of the problem in terms of the Nation's debt and
    the deficit. I would tell you that on a $1.6 trillion deficit,
    if you cut the Defense Department by 10 percent, which
    operationally would be catastrophic, that is $50 billion. You
    haven't gotten very far toward dealing with the deficit.
        The second thing that I worry about is that what we have
    found in the executive branch is that the elements of the
    different parts of the executive branch are increasingly
    integrated in the way they deal with problems, the State
    Department and the Defense Department and AID [Agency for
    International Development], and yet the jurisdictional lines
    here on the Hill are such that you don't get to see the overall
    national security picture that we see in the situation room or
    that the President sees that brings intelligence, and the State
    Department, and Defense and these different elements together
    and integrate those. And I think it is a challenge because this
    is becoming more and more the case in the problems that the
    Nation is dealing with in national security, and yet Congress
    continues to have essentially a stovepipe approach to dealing
    with these issues. And this is one of the reasons the State
    Department doesn't get enough money.
        So as you all think about the future, those are two things
    that concern me.
        Mrs. Davis. Thank you.
        Thank you, Mr. Chairman. I will submit other questions for
    the record. Thank you.
        The Chairman. Thank you.
        We are going to turn to Mr. Wilson, and then we are going
    to take a 5-minute short break.
        Mr. Wilson.
        Mr. Wilson. Thank you, Mr. Chairman.
        And, Admiral, Mr. Secretary, Mr. Secretary, thank you for
    being here today. In particular, Admiral and Secretary Gates, I
    want to thank you for your service as you highlight the
    conclusion of your careers in the military, serving our service
    members.
        I do have the same concern of our chairman. It is a
    bipartisan concern, I was listening to Congressman Reyes, and
    that is with the drawdown, with the force reduction in the Army
    and Marine Corps, I am very concerned on the effect on dwell
    time. I am very concerned about the effect on morale, morale of
    the service members, on their families, the consequence of them
    not feeling secure as to their military futures, of people who
    have been so dedicated to our country.
        With that in mind--and it has been stated that it is going
    to be conditions-based--Mr. Secretary, what flexibility will
    there be for the service chiefs in terms of the conditions? And
    it is my view that the conditions have even changed in the last
    month with the instability in the Middle East, the potential
    facing an asymmetric enemy on a broader scale that would
    require more boots on the ground.
        Secretary Gates. Well, I think that your concern about an
    asymmetric threat is correct, and I would tell you that I think
    that those who will face this asymmetric threat to the greatest
    extent are, in fact, the Air Force and the Navy, particularly
    as we look at capabilities that China and others are
    developing, the kinds of activities that the Iranians are
    engaged in, and the North Koreans and so on. That is why we put
    a freeze on--both the Air Force and the Navy in 2007 were
    drawing down their personnel, and we stopped that. So there are
    no drawdowns planned for the Air Force and the Navy.
        As I have said earlier, the Marine Corps, this is their
    idea, and I think you need to talk to General Amos and get his
    thinking and his logic in terms of why the Marine Corps ought
    to be smaller and lighter, assuming we come out of Afghanistan.
        And I would tell you the kinds of instability that we are
    seeing in the Middle East now, it is difficult for me to
    imagine circumstances in which we would send U.S. ground forces
    in any of those situations. Those are problems that are
    emanating from within those countries, and it is primarily a
    diplomatic challenge for us, although I would say if you ever
    wanted proof of the value--as the chairman said in his opening
    statement, of the value of our military assistance to Egypt
    over the past 30 years, it has been in the behavior of the
    Egyptian Army over the past 3 weeks and their professionalism
    in dealing with the kinds of situations they have.
        But, look, 2015 is a long way away, and I think that the
    Department--and we are talking about $6 billion. So I think
    that the service chiefs have a lot of flexibility in terms of--
    if they determine in 2013, 2014, thereabouts that drawing down
    from 547,000 or from 187,000 in the case of the Marine Corps
    is--or 202,000, rather, then they can obviously make that
    pitch.
        I would tell you, though, a lot is going to depend on who
    is the Secretary of Defense and who is the President, because
    there had been opposition within the Department of Defense to
    increasing end strength when I arrived, and that is why it
    hasn't happened. The previous chairman of this committee had
    been a strong advocate of increasing end strength, and many of
    you had been as well, but it didn't happen until you had a
    different Secretary of Defense. So that will matter, too, as
    well as the service chiefs.
        Mr. Wilson. And I do want to commend the surge, I think
    successful, in Afghanistan. I am very grateful that so many of
    the Army personnel were trained at Fort Jackson, and I
    represent Parris Island Marines, making such a difference.
        Also in regard, Secretary, to the National Guard, what is
    the status of our equipping of the National Guard for their
    domestic and foreign capabilities?
        Secretary Gates. This is a real success story. This is
    something that I am pretty proud of. When I came to this job,
    the equipment on hand across the Nation on average for the
    National Guard was about 40 percent. It is now in the mid-70s.
    The historical equipment on hand for the Guard is about 70
    percent. So we are well above that. But more importantly than
    that is that they are getting first-line equipment. They are
    not getting hand-me-downs from the Active Force. They are
    getting the same high-quality, high-tech equipment that the
    Active Force is.
        Mr. Wilson. Thank you very much.
        The Chairman. The committee will take a 5-minute recess and
    reconvene at 10 minutes to 12:00.
        [Recess.]
        The Chairman. The committee will come to order. Mr. Larsen.
        Mr. Larsen. Thank you, Mr. Chairman.
        Mr. Gates, the first question is for you. Do you have a
    date for the tanker decision? Sorry. Secretary Gates. Do you
    have a date for the tanker decision?
        Secretary Gates. Sorry?
        Mr. Larsen. Do you have a date for the tanker decision?
        Secretary Gates. No. But I would say within the next 2 to 3
    weeks, something like that.
        Mr. Larsen. Okay. Thanks.
        Admiral Mullen, your written testimony discussed the pooled
    resources idea. Your oral testimony actually gave a title, and
    that is about as much right now as we have. You both have
    testified even today about the need to combine State and
    Defense activities. Can you talk a little bit more about how
    you envision this collaborative full resource idea and when we
    can expect to see actual language?
        Admiral Mullen. From my perspective, I think what has
    worked with State--between State and DOD is what I would call
    this dual-key capability that assigns responsibilities to the
    Secretary of Defense, Secretary of State to both agree that we
    are going to spend the money a certain way. And I think that is
    reflective of the requirements which continue to emerge. I
    mean, it gets focused on Iraq and, to some degree, in
    Afghanistan, but it is really the preventive aspect of this,
    the investment ahead of time so we are not in conflict. In
    great part, to the Special Forces, for us, for example, is one
    area. But we can't do it all, and that is really what this
    speaks to.
        I think in terms of the, you know, level of detail and
    proposal, I mean, I think we can get that to you, you know,
    relatively quickly. The language is there right now, as I said.
    It is $50 million initially with the language we would like,
    language which would allow us to reprogram an additional 450-,
    you know, out of our money as needs emerge. Often times this is
    a speed issue, I mean, as opposed to we need to do it now as
    these emerge, as opposed to take months or maybe even a year.
        Mr. Larsen. Do you envision that you need additional
    authorities, or do you just need reprogramming authority?
        Admiral Mullen. I think we need both. We will need
    authorities for the $50 million and then reprogramming money on
    top of that. Authorities. Sorry.
        Mr. Larsen. And then authorities for a decision structure
    as well?
        Admiral Mullen. Right. Yeah. And support for a decision
    structure.
        Secretary Gates. So you can influence your colleagues and
    the other committee, the $50 million is the State Department
    contribution. The larger number is ours.
        Mr. Larsen. That was the next question. I think it is
    important that both agencies have skin in the game, if you
    will, to make this work, and I think probably for it to work
    around here, it is going to have to look that way as well.
        So I will look forward to some actual language and help
    from you all on that.
        The continuing resolution on the floor today and the next
    day includes a hit to the Department of Energy's [DOE] budget
    on nonproliferation of about $600 million, if I am not
    mistaken, below the 2011 request. This is for nuclear
    nonproliferation. And this is the loose nuclear materials
    piece, in addition to some other things, which is something
    that is in our jurisdiction as well.
        Can you talk about or have you looked at what the impact of
    that hit will be on our ability?
        Admiral Mullen. No, I have not.
        Mr. Larsen. Okay. Can you--well, we only have a couple of
    days. I won't ask you to get back to me in the next 2 days on
    that one because we are voting, presumably tomorrow, on that
    one. Yeah.
        Can you speak, though, to the 2012 request for the
    Department of Energy's nuclear non--the nonproliferation budget
    request as it applies to our jurisdiction?
        Secretary Gates. To be honest, Mr. Larsen, the only part of
    the energy budget that I have any familiarity with is for the
    NNSA [National Nuclear Security Administration] stuff on the
    nuclear weapons. I am just not familiar.
        Mr. Larsen. Well, pieces of that is in NNSA. Okay. That is
    fine.
        Can you then finally discuss the budget request perhaps,
    Secretary Gates, here in the last couple of seconds, about the
    budget request for the phased adaptive approach [PAA] for
    missile defense, supporting not only phase 1, which started
    implementation this year, but what the budget request looks
    like for PAA on phases 2 through 4, what kind of dollars are in
    there to continue moving this along?
        Secretary Gates. I can't parse the specific elements of it.
    I do know that the overall budget for missile defense is going
    from $10.2- to $10.7 billion. So we are putting another half a
    billion dollars into it. And there is money for more Aegis
    ships, more of the transportable radars like we have in Egypt,
    like we have in Israel and Japan right now. And then there are
    also continuing investments in the Ground-Based Interceptor
    [GBI] system. So there is money--as well as some of the high-
    level technologies like high-energy lasers and precision
    tracking from space. So there is a significant increase in
    missile defense, including being able to go forward with the
    phased adaptive array defense in Europe.
        The Chairman. Mr. Turner.
        Mr. Turner. Thank you, Mr. Chairman.
        Mr. Secretary, thank you. Thank you for your letter
    yesterday in which you announced your support for a Federal
    uniform standard of custody protection for our men and women in
    uniform. I get to thank you on behalf of myself; this
    committee; the staff of this committee; and Eva Slusher from
    Kentucky, who had lost her daughter in a custody battle as a
    result of a family law court judge using her time of service
    against her in a custody battle that she ultimately won and got
    her daughter back.
        I know that you know that unfortunately throughout our
    country, there are family law courts where the judge will use
    the time away that someone has been deployed, or even the
    threat of deployment, as a sole factor for determining custody,
    resulting in our men and women who should be being honored for
    their service actually being disadvantaged for their service.
        I know that you know that this House has passed this in
    legislation form five times, four as part of the National
    Defense Authorization Act and once as part of a stand-alone
    bill. Your letter indicates that you will be assigning your
    staff with the responsibility to negotiate language that can
    ultimately be enacted in legislation to provide that
    protection.
        This is a battle that has been going on for 5 years now in
    legislation, and I know that you know this doesn't just affect
    our service members who are currently in custody battles--and
    we are not asking for them to be advantaged; we just don't want
    them to be disadvantaged--but it also affects our service
    members who have the stress of the concern that they may be
    subject to a custody battle and don't have a national standard
    of which they can have confidence.
        Many of these custody battles involve three States; the
    State in which the original custody order was issued, the State
    where the service member is currently assigned, and the State
    in which the child currently lives. So the national standard is
    going to be so important to provide them that confidence.
        So my first question to you--and I have two other topics I
    want to get to--is I believe that this should not wait for the
    National Defense Authorization Act this year. This House has
    passed it as a stand-alone bill. It has passed it on suspension
    on the House floor. We passed it four other times as part of
    the National Defense Authorization Act. If we roll up our
    sleeves, we can get this done and pass this very quickly
    through the House. I would like to have your support for us to
    get to work on this right away.
        Secretary Gates. We certainly will do that. Whether you can
    get it through the House or not in a hurry, I guess, is up to
    you all.
        Mr. Turner. That would be excellent.
        The second thing I want to talk to you about is the issue
    of sexual assault. In my district we had a woman, Maria
    Lauterbach, who was tragically murdered after making
    allegations of sexual assault. I have worked with Jane Harman
    and Representative Tsongas on provisions that we have gotten
    enacted over the past several years that addressed the issue of
    sexual assault.
        A New York Times article, in reporting the lawsuit that has
    been filed, identifies that the legislative accomplishments so
    far are modest. We actually had in this last National Defense
    Authorization Act provisions that went to the issue of sexual
    assault, one of which would have provided a mechanism for
    expedited consideration and priority for base transfers for
    those who have been subject to sexual assault, another
    providing privileged communication between a victim and an
    assigned victim advocate.
        All of those did not make it into the final bill. I just
    want to bring them to your attention and hope that we would
    have DOD's support as we move to try to place those provisions
    in the National Defense Authorization Act this year.
        And then my third topic is NNSA. I am chairman of the
    Strategic Forces Subcommittee. One of the things that I have
    been concerned about with this continuing resolution process
    and then the upcoming fiscal year 2012 budget is that NNSA,
    being part of DOE, has not been recognized as really being part
    of the defense infrastructure. So when people talk about
    cutting everything that is non-security-related, so many times
    they are missed and actually subject to a cut.
        As we look to the importance of NNSA and the additional
    funding that they need to respond to supporting our nuclear
    infrastructure, I would appreciate your comments on certainly
    both their importance, the importance of this funding, and also
    the characterization that should be made that NNSA is certainly
    part of our national security infrastructure and certainly does
    very important defense work.
        Secretary Gates. Well, I simply can endorse the last two
    statements. I mean, it is incredibly important, and it clearly
    is intimately tied to our national security and should be
    regarded as part of the security component.
        Secretary Hale. I would just add one point from a budgetary
    standpoint. From 2013 to 2016, we actually have some money in
    the defense budget, which on an annual basis will be
    transferred. And in NNSA the desire was to emphasize the
    partnership between our two organizations. As the Secretary
    said, they are very important to meeting our nuclear needs.
        Mr. Turner. Excellent. Thank you both.
        Mr. Chairman.
        The Chairman. Thank you.
        Ms. Bordallo.
        Ms. Bordallo. Thank you very much, Mr. Chairman, Mr.
    Secretary and Admiral Mullen. Thank you for appearing today and
    providing us with your testimony as well as your service.
        First, I just have one simple question. I guess it would be
    an up-and-down answer. I want to thank you for your support of
    H.R. 44, the Guam war claims bill that was introduced last
    Congress. This proposed legislation is very important to the
    Chamorros on Guam, who survived the brutal enemy occupation
    during World War II. Although we were unsuccessful last
    Congress in the Senate, I have reintroduced the compromise
    version of H.R. 44, which eliminates the payment of claims to
    descendants of those that suffered personal injury during the
    occupation.
        Now, can we expect the same level of support from the
    Department of Defense as we did in the 111th Congress? The
    people of Guam, Mr. Secretary, are being asked to provide
    additional land for firing ranges and the main base area for
    the current buildup. And resolution of Guam war claims is going
    to be critical to overcoming historical injustices.
        Secretary Gates. Well, as Deputy Secretary Lynn testified,
    we continue to support the Department of Justice position on
    this.
        Ms. Bordallo. So I guess the answer would be yes.
        Secretary Gates. Yes.
        Ms. Bordallo. My second question. I am encouraged to see
    the administration continuing to support the so-called Guam
    International Agreement with military construction funding for
    the realignment of the Marines from Okinawa to Guam. I am also
    encouraged by the funding of civilian infrastructure needs in
    Guam.
        My question is for Secretary Gates. Given the strategic
    importance of Guam and our Nation's ongoing efforts to reshape
    our military presence in the Pacific theater, can you tell me
    what the status is of the Department of Defense's roadmap for
    realigning U.S. forces in Japan? Specifically, how is the
    reconfiguration of Camp Schwab facilities and the adjacent
    water surface areas to accommodate the Futenma replacement
    facility project proceeding? And when can we expect to see
    tangible progress on Okinawa for a Futenma replacement
    facility?
        Secretary Gates. My hope is--well, I discussed this when I
    was in Japan just a few weeks ago. I feel like the Japanese
    Government is making a serious effort to resolve the Futenma
    issue. My hope is that we will get resolution, particularly on
    the configuration of the airfield or the runways, perhaps later
    this spring, and that would then allow us to go forward with
    our planning.
        Until we get the Futenma replacement facility issue
    settled, we really are not in a position to go forward. Without
    resolution of that issue, troops don't leave Okinawa; lands
    don't get returned to the Japanese, to the Okinawans. So these
    are points that I made both publicly and privately when I was
    in Tokyo.
        And so my hope is that we will get resolution of this to a
    sufficient point by sometime later this spring, and we then can
    go forward and work with this committee in terms of that
    planning. And just to clarify a statement that I made to Mr.
    Thornberry, I expect to be around for some months to be able to
    work with you on that.
        Ms. Bordallo. Well, good. That is good. All right.
        My third question is for either Secretary Gates or Chairman
    Mullen. I was pleased to see about $200 million in research and
    development for a next-generation bomber, and I think this is a
    key platform in maintaining a robust long-range strike
    capability.
        Can you explain the rationale behind your decision to build
    a long-range manned bomber with the ability to penetrate
    defended air space? And why is stand-off insufficient to meet
    future combatant command requirements? What are the inherent
    limitations within our existing legacy bomber fleet?
        Admiral Mullen. Actually you almost, ma'am, said it in your
    question. We actually went through a very, very vigorous
    debate, review and analysis to get to the conclusion that this
    should be--that we should invest in a new penetrating stealth
    bomber, and we think that capability is vital for the future.
    We certainly--there is great focus, obviously, on this with
    respect to the Pacific.
        But in a lot of these capabilities that we have developed
    over the years, oftentimes even the area of focus that we might
    use it in changes. So we think it is actually broader than
    that.
        And it was reviewed for both its ability to be developed
    from evolving technology, so it goes to--I think there is a
    very smart acquisition strategy associated with this. This
    isn't going to be exquisite in every way. It is bounded in cost
    and, we think, terrific capabilities that, when combined in the
    platform, will actually result in a revolutionary capability,
    not just overall in terms of our requirements.
        Ms. Bordallo. Thank you very much, Mr. Chairman. I have a
    couple of other questions, but I will enter them into the
    record.
        The Chairman. Thank you very much.
        The Chairman. Mr. Conaway.
        Mr. Conaway. Thank you, Mr. Chairman. Thank you gentlemen
    for your service, for being here, et cetera, et cetera, adding
    on.
        At the risk of a 15-yard penalty for piling on, I am going
    to go back to the audit issue that Mr. Forbes brought up. It is
    not going to happen. I mean, neither one of you gentlemen--
    well, actually none of the three of you will be in place when
    this gets done. That is inherent with the system that we have
    in place where no one is there, and that helps explain somewhat
    why we are not there is because unless it is a key component of
    what you want to get done, it is not going to get done.
        I wish we had the same kind of commitment to auditing this
    Department of Defense's financial statements and/or--or just
    the statement of receipts and disbursements that we have to
    greening the military. I don't think greening the military is a
    core competency of the fight. But yet we all heard testimony
    this morning about all the wonderful things that were done with
    respect to that, and you can't tell us what the differential in
    cost is between doing it that way versus what the standard way
    of doing it, what did it cost us? Do we get a cost benefit for,
    as Mr. Reyes said, taking Fort Bliss off the grid? We don't
    know what that costs and those differentials.
        The story in the Washington Post that Ms. Sanchez mentioned
    where folks who have defrauded the government have been awarded
    additional contracts for some $285 billion, that is an internal
    control issue. Internal controls are an integral part of a good
    financial system that allows you to know where your money is
    going and know where your money is not going. So every time we
    have these kinds of stories, it adds to the confusion in the
    area.
        I go home to folks in west Texas, and when they find out
    the Department of Defense can't be audited, they are stunned.
    It has been on the books a long, long time. And, you know, Mr.
    Gates, your revelation that you've got thousands of auditors
    and 10,000 lawyers was kind of eye-opening for those of us on
    this side of the deal.
        I want to brag on the Marine Corps. They got very close
    this year--let me step back. Secretary Hale and I and his team
    and others, I have had extensive conversations with them,
    briefings. I have been over to the Pentagon and talked to them.
    They get it. They are working really hard, but as Petraeus said
    last year, hard is not impossible. And as Keith Alexander says,
    nothing is impossible for those who don't have to do it, and I
    am one of those who don't have to do it, but you do. So I want
    to brag on the guys that are working. The Marine Corps is
    getting close.
        But the question is, how do you leave a legacy--which
    everybody wants to leave good legacies--how do you leave a
    legacy in place that keeps this process moving, that you hand
    off, you get it so systemically ingrained into the team that
    this is important? We need to know where the money is going. We
    need to be able to have the, quote/unquote, ``Good Housekeeping
    Seal of Approval'' so that the general public gains additional
    confidence in the one entity of government that the general
    public generally has great confidence in, and that is in the
    Department of Defense. So how do you leave that legacy in place
    to make sure of this, we don't lose ground because you are not
    going to be responsible when 2017 rolls around and it is not
    done?
        Secretary Gates. Well, first of all, I think that Mr. Hale
    and I have talked about this. He has asked for my support in
    terms of communicating to the rest of the Department that this
    is a high priority, and I have provided that support.
        But to answer your question of how I know that this will
    continue after I am gone, that is because Mr. Hale will not be
    gone, and he will continue in this, and he is committed to
    this, and I think he has the plan in place, as I have mentioned
    earlier, both short term and longer term, in terms of getting
    us to a point where we are in compliance by 2017.
        Mr. Conaway. Well, we are going to keep tracking it. I hope
    to be able to get the matrix in place so that you can measure
    progress against that timeline, and we can see it as well. But
    it also begs the question you have got $100 billion of
    reprogramming money; in effect, dollars you say your team has
    come together and said we don't need to do $100 billion worth
    of this, we would rather do $100 billion worth of that over
    that timeframe. How are you going to track that? How are you
    going to make sure that that $100 billion of reprogramming
    doesn't morph into the $78 billion--the commitment to save the
    $78 billion over these next timeframes? Because I can see very
    easily where you would wind up with--you fulfill the 78- number
    by siphoning off numbers, monies that would have otherwise been
    reprogrammed within the Department of Defense.
        Secretary Hale. Mr. Conaway, I would like to offer a
    defense of the defense financial management system that may be
    unpopular. First, I am fully committed to audits. I understand
    we need them for public confidence. But the fact that we can't
    pass commercial audit standards does not mean we have no idea
    where we are spending the money that you send us.
        We have got 55,000 people in the defense community, the
    financial community. They are well trained, and that is one of
    their prime jobs, as is the job of many others. We have several
    thousand auditors watching us. And I note if we had no idea
    what we were doing with the money, we would have rampant
    Antideficiency Act [ADA] violations.
        Over the last 5 years, about two-tenths of our budget has
    been associated with ADAs. That is more than I would like, but
    it is pretty small, and it is smaller, I might add, than the
    percentages of the nondefense agencies, all of whom have clean
    audit opinions.
        So I think we do know what we are doing with the money you
    give us, and we can account for it. We can't pass commercial
    audit standards, and we need to do that to reassure the public
    we are good stewards of their money, and I am committed to
    doing it, and I am working hard.
        Mr. Conaway. Thank you, Mr. Chairman.
        The Chairman. Mr. Courtney.
        Mr. Courtney. Thank you, Mr. Chairman. And I want to thank
    the witnesses for their testimony today.
        I was at the first hearing after you were appointed
    Secretary. I was a brand-new Member of Congress, remember well
    the fact you walked in and announced we were going to increase
    end strength, which has been referred to here this morning.
        I also just would note that that was also the hearing where
    you announced that we were going to make a commitment to MRAP
    [Mine Resistant Ambush Protected vehicle] deployment in Iraq
    and Afghanistan, which only a handful, relatively speaking,
    were in theater.
        I just want to share with you that last Easter there was a
    Connecticut National Guard unit that was riding in an MRAP in
    Laghman Province, that unfortunately a 200-pound IED was
    detonated. It lifted the MRAP many feet in the air, came
    crashing down. Everyone survived. There were some pretty bad
    injuries, but everyone is alive. There was no question that if
    a flat-bottom Humvee had been part of that type of event, it
    wouldn't have been the case.
        I am friends with one of the mothers of one of those
    soldiers who, you know, is a lawyer in practice in the New
    Haven area, and, you know, she said to me she didn't know what
    an MRAP was to M&M. But she said whoever was responsible for
    making sure that those types of units were in the theater, just
    thank them for her. And I am doing that publicly, and to you,
    too, Admiral Mullen, because you were a part of that
    extraordinary effort to finally get those things over there to
    protect our troops. So thank you.
        I want to just touch on two quick things that people talk a
    little bit about in Connecticut. The alternate engine, that was
    part of the debate last night. And one of the comments that was
    made by Admiral Roughead last year when this issue came up was
    that aside from, you know, the claims that the up-front
    production costs of a second engine would pay off over time, I
    mean, he pointed out the fact that on aircraft carriers, there
    is just no space capacity to deal with repairing and
    maintaining two separate engine systems.
        Obviously we have an admiral here who knows these ships
    quite well. And I just wonder if you could sort of comment on
    the, I think, overstated claims of savings when you think about
    the operational headaches that a second engine would create.
        Admiral Mullen. One of the things we do in this town is we
    focus on getting stuff out the door, as opposed to what it
    costs for a life cycle. And it certainly applies on aircraft
    carriers, but it applies actually in all three services. This
    is two separate lines, two separate training, two separate
    maintenance manuals, two separate supply sources, all those
    kinds of things, and they lag each other significantly.
        I mean, I have been doing money a long time. I cannot make
    sense out of this second engine. It is 2 to 3 years behind. It
    is not going to compete, quite frankly.
        We cannot afford to buy the second engine, I mean, from my
    perspective, and there have been multiple airplanes that are
    single-engine airplanes that are single-sourced. So I don't
    accept that 95 percent of the fleet is going to go down at
    once. It just doesn't happen. We are better than that.
        You know, the first engine will be, I think, more than
    adequate to meet the needs that we have for that airplane. And
    if I thought any different, I would, you know, be encouraging
    this engine, the second engine.
        I just categorically can't see that it is going to make any
    difference. It is going to cost us a lot of money not just to
    get it out of the door, but over the life of its--over the life
    cycle.
        Mr. Courtney. And for the proponents who keep bringing up
    the F-16, I mean, the fact is we are in a different world than
    25 years ago as far as testing these engines, right? I mean,
    the risk level is just not what it was.
        Admiral Mullen. Absolutely.
        Mr. Courtney. I just wanted to at least get your statement
    on the record on that.
        Secretary Gates. It is worth noting that not only the F-16
    have a single source, but also the F-22--or the F-18, rather,
    have a single source, but also the F-22. And the F-135 engine
    is a derivative of the F-22 engine. So the likelihood of any
    kind of a serious design failure is very small.
        Mr. Courtney. Thank you.
        Real quick. I have only got a minute left, but I just want
    to at least note for the record again, a year ago we were
    talking about a $7 billion SSBN submarine. Obviously, we were
    at milestone A. We have now brought that figure down to $4.9
    billion. Congratulations.
        It is still, as you point out, going to be a long-term
    challenge for the shipbuilding budget. Admiral Roughead makes
    the argument that it should be treated as a national strategic
    asset, which--I see you smiling because I think you smiled last
    time I asked you about this.
        But the fact is, you know, there is precedent with missile
    defense for treating it outside of a normal defense budget. And
    I just--that is a solution, isn't it, if we could figure out a
    way to make it happen?
        Admiral Mullen. It is a third of the shipbuilding budget. I
    mean, if the shipbuilding budget has to absorb that, that is
    this year, it would break the shipbuilding budget.
        And to the Secretary's point earlier about building other
    capabilities, that solution that you describe has been talked
    about for years. But what it boils down to is obviously
    resourcing this, resourcing a shipbuilding plan which is going
    to get us to 313 and beyond, and with the SSBN arrival, that is
    not going to happen.
        So how you resource it is the question. One way to do it is
    literally at the national level as opposed to inside the
    service budget, but it is a huge challenge just because of the
    money that we are going to have to devote to it.
        The Chairman. Mr. Wittman.
        Mr. Wittman. Thank you, Mr. Chairman.
        Secretary Gates, Chairman Mullen, thank you so much for
    joining us. Thank you for your service.
        I want to begin with Chairman Mullen and follow up on my
    colleague's question concerning shipbuilding. As you know, if
    you go back to 2006, the shipbuilding plan there said 313
    ships, and we have heard that number year after year after
    year. We find ourselves today with 286 ships. We find ourselves
    with an aging class of Perry frigates that are going to be
    phasing out. We find ourselves with six Los Angeles class
    submarines that are 30 years or older. We find ourselves in an
    environment with a very, very high ops tempo putting ships to
    sea, pushing maintenance schedules, pushing life cycle
    capability management elements.
        My question is this: Is it anywhere in the spectrum of
    reality that we will have a 313-ship Navy, and, if so, how are
    we going to integrate these older ships that are coming to the
    end of their service lives and making sure that we are building
    at a pace where we are building more ships than what we are
    retiring? And as you know now, we are at a pace where we are
    retiring more ships than what we are bringing into the fleet.
    And I just wanted to get your perspective on that.
        Admiral Mullen. Well, actually this budget, which is, I
    think, 10 ships and $15 billion is not insignificant compared
    to where we were a few years ago.
        Secondly, I have been someone that I believe we have to get
    ships to their service life. That is an easy thing to say. It
    is hard to do, because you have to make that investment over
    the course of a ship's service life, and oftentimes the Navy
    hasn't done that specifically.
        What gets lost in this discussion about the number of ships
    that we have, and I actually, as a CNO [Chief of Naval
    Operations], did the analysis that created the minimum level
    for the Navy of 313 ships, but it was my belief back then we
    were on a glide slope to get to 220 or 230 or 240 because it
    was just out of control going down because of the cost and lots
    of other things, the number of ships that we were going to have
    to decommission. So it is not at 313, but it actually has
    grown, and I think we have to just keep heading in that
    direction. That is key; a number of ways to do that.
        So, and as the Secretary has spoken--and he and I have
    talked about this many times--you know, as these wars wind
    down, we are going to, I think, have to depend more and more on
    our Air Force and our Navy in the world that we are living in.
    And so how do we make those investments? Because what gets lost
    in the discussion here is their op tempo has been pretty high.
    And we talk about the op tempo for the Army and the Marine
    Corps and the Special Forces. That is at the top, I understand
    that. That is the toughest op tempo. But if you look at the op
    tempo of the Air Force and the Navy since 9/11, it is up as
    well. They weren't sitting back at that point in time. So we
    are wearing them out, and we have to focus on those
    modernization programs. They provide an enormous strategic
    capability for us, given the world that we are living in, and
    we have to invest in it as well.
        Mr. Wittman. Are you in the position to make the commitment
    to make sure that on life cycle management that you are doing
    everything, including the inspection programs to make sure they
    are robust and the financial commitment to make sure these
    ships get to the yard on time? Because as you know, any little
    glitch in the schedule there really affects a sub-zero.
        Is the commitment there to make sure that we are going to
    get to the end of the service life of these ships to make sure
    that we are getting that, or have some chance of getting to the
    313?
        Secretary Gates. Before the chairman answers that question,
    may I say that if we end up with a yearlong continuing
    resolution, those ships are not going to make it into
    maintenance.
        Mr. Wittman. Okay.
        Admiral Mullen. I also, actually, just to the CR, I was
    struck that you lost a DDG [guided missile destroyer] and a
    submarine. We worked for years to get to two submarines a year,
    and literally within a few months it falls out. You are not
    going to get that back certainly in this budget. This is a
    really a discussion better had by Admiral Roughead
    specifically.
        I know the Navy has invested more in terms of its
    maintenance in order to sustain or get to extended life. That
    said, he has also made a decision to decommission some ships
    before that so that he can invest in some of the ships that he
    thinks he needs for the future.
        Mr. Wittman. Secretary, I want to follow up quickly with
    you. We talk about the QDR being the issue in the National
    Military Strategy. In their current projections, do they keep
    in mind where end strength may be with your projections about
    reducing end strength for both the Marine Corps and the Army in
    how the QDR estimates that in National Military Strategy?
        Admiral Mullen. Yes, they do.
        Mr. Wittman. They do.
        Thank you, Mr. Chairman. I yield back.
        The Chairman. Thank you.
        Gentlemen, we have a very strong agreement on the CR. We
    have a very strong disagreement on the second engine. In my
    district, it doesn't matter, so I don't have a parochial
    interest in this, but I do have a strong opinion.
        But I would like to ask you, you both said this is your
    last hearing. I could probably say with great certainty that
    none of us, none of the three of us, will be here in 10 years.
    How long are we going to be buying the engine for the F-35?
        Admiral Mullen. Oh, I would say over the course of 2 to 3
    decades.
        The Chairman. Okay. So 20, 30 years.
        Admiral Mullen. Right.
        The Chairman. Ten years from now if we have decided on the
    one engine, if, for whatever reason, the company comes to us
    and says, I have to raise my costs substantially, what do you
    do?
        Admiral Mullen. Actually I look at it--I mean, you are
    getting at the competition piece, and I understand.
        The Chairman. I am.
        Admiral Mullen. But as I look--and let me shift quickly--F-
    18Es, you get rate and you get savings by production levels.
    That is how you create it.
        The Chairman. Do we have a fixed cost on this, or will
    they, being a sole-source engine, be able to raise their prices
    10 years out?
        Admiral Mullen. I actually think that with the kind of
    production line we are talking about, they will come down.
        The Chairman. We hope.
        Admiral Mullen. Sir.
        The Chairman. Ms. Tsongas.
        Ms. Tsongas. Thank you, Mr. Chairman. And thank you both
    for your testimony and your very thorough responses to our many
    diverse questions.
        I would like to come back again to the issue of sexual
    assault in the military. It is obviously one that is much in
    the news today, but really has been a long-standing issue, and
    I think, as Representative Turner mentioned, something that
    this committee has worked hard to deal with and find a way
    forward. But despite that, despite--and we have heard testimony
    from the various services as to all their efforts, but despite
    that, in 2010, there were 3,230 reported sexual assaults in the
    military. But by the Pentagon's own estimate, as few as 10
    percent of sexual assaults were reported. And the VA
    [Department of Veterans Affairs] estimates that one in three
    women veterans report experiencing some form of military sexual
    trauma.
        I can remember several years ago meeting with some people
    active in the VA in the State of Massachusetts and having a
    gentleman comment and say that that was one of their dominant
    issues that they had to deal with.
        The fiscal year 2011 Defense Authorization Act required
    that the Department look into the feasibility of providing a
    military lawyer to all victims of sexual assault. While this is
    a good first step, I was disappointed that provisions which
    guarantee all victims the right to legal counsel and protect
    the confidentiality of conversations between victims and victim
    advocates were not included in the final version of the 2011
    NDAA, though they were in the House version.
        We would be shocked if conversations between their client
    or advocate were not privileged in the civilian world, and
    similar rights must be afforded to service members who may be
    the victim of a crime. Why would the Department resist such a
    commonsense measure? And I ask this of Secretary Gates.
        Secretary Gates. I hadn't realized the Department had
    resisted it, and I must say, along with Mr. Turner's comments,
    these things sound to me like reasonable actions. And so I will
    take out of this hearing the charge to look into whether--why--
    if we opposed it, why we opposed it, and why we should not go
    forward on our own, even without legislation.
        Ms. Tsongas. And I would appreciate, once you do that, of
    getting back to me in some form so that I and others who felt
    this was very important.
        I mean, one of the things we have found is that despite all
    the good efforts on the part of the services, that the follow-
    up procedures, legally, do not support--undermine all of the
    efforts you have made around sort of preventing this in the
    first place, providing access to medical care. But if the
    follow-up legal processes do not sufficiently protect a victim,
    make them feel comfortable in coming forward, that it
    undermines all the good work you have done. They become suspect
    of the entire process, feel very much at risk. And this was one
    very commonsense way, going forward in a legal process alone,
    that we felt we could better protect victims as they try to
    assert their rights.
        Secretary Gates. This is one of the reasons why we have
    invested, as I mentioned earlier, over the last couple of years
    almost $2 million in training our prosecutors. We found, when I
    started looking into this several years ago, that the
    defendants hire lawyers who are specialized in this area, and
    our prosecutors tended to be--not have that specialty. And it
    is complex law, and it is difficult to prosecute successfully,
    particularly if you don't have the right training.
        And so that is one of the reasons we have undertaken that.
    And, as I say, we have expanded the Victim Advocate Program
    dramatically from about 300 to 3,000 around the world over the
    last few years in every base and installation. And I will press
    on the question of why we cannot assure confidentiality.
        Ms. Tsongas. And the other issue we have learned, too, is
    as all the services have dealt with this, each has done it in
    its own way reflective of its culture and different processes.
    That becomes very difficult to oversee as a Member of Congress.
    So in the defense authorization bill we ask for a comprehensive
    approach across all of the services, and I know that the
    Defense Department is working on that, and we look forward to
    what you come up with.
        So thank you both.
        The Chairman. Thank you.
        Mr. Coffman.
        Mr. Coffman. Thank you, Mr. Chairman.
        First of all, thank you so much for the great job that both
    of you have done on behalf of our country.
        Let me first thank you for standing firm on the issue about
    the second engine for the F-35. I just think that we have got
    to make some tough decisions with limited resources, and that
    is certainly one of them that I think is wasteful that I
    certainly support you on.
        Also, in your position on the Combined Forces Command,
    Joint Forces Command, I think that its time has gone, and I
    certainly support you in that effort.
        But in terms of looking at the--I am concerned about still
    the top-heavy nature of the Department of Defense. And I noted
    that right now I think we have 268 ships, if that is the proper
    number. I believe it is. We have 253 admirals right now. That
    is almost one admiral per ship, and I think that the Navy is
    authorized to go to 283 admirals.
        And so can you tell me, give me some more visibility as to
    what could be done to try and streamline the military?
        Secretary Gates. One of the things that we have done as
    part of the efficiencies efforts is we have eliminated--out of
    900 flag-rank officers in the military, we will eliminate 100
    general officer positions over the next couple of years, and
    that includes admirals. And we also will be eliminating
    somewhere over 200 senior civilian executive positions. So I
    was asked earlier about the $11 billion for rebaselining OSD
    and the defense agencies and so on. That is where a lot of
    those positions are coming from.
        But we are also downgrading positions. We are not only
    eliminating positions, we are downgrading a number. For
    example, the component commanders in Europe will be downgraded
    from four stars to three stars, except for the Navy because
    there is a NATO connection on that side, so that will take
    longer.
        But we are trying to come at it both from the standpoint of
    is the level of flag-rank officer for the job right, given
    passage of history, and can we get rid of these positions? And
    we have done so on both civilian and the uniform side.
        Mr. Coffman. Thank you.
        Admiral Mullen. Well, thank you.
        If I could just briefly, and this is inside baseball, but I
    think it is one of the things I told the Secretary when we
    started to review this. You know, when budgets get tight,
    people start taking shots at how many admirals and generals
    there are. That is historic.
        What the Secretary led was a very thorough review--and
    actually the services did this--a very thorough review of need,
    what level for what job. And that will continue to go on.
        There is also, at least over the course of the last 15
    years for me, all of which I have been an admiral--far beyond
    anything I ever expected, believe me--there is also just a
    growing complexity that requires some level of senior civilian
    and uniformed leadership in the world that we are living in.
        So I am all for the reductions that make sense, but too
    often it is also a very easy target. And I just would like--as
    we have tried to be careful about it.
        Mr. Coffman. Well, thank you. It is an easy target, and I
    certainly think it is one we are willing to take.
        Let me talk about what is the Department of Defense doing
    in terms of reexamining our foreign basing commitments or our
    forward presence in terms of whether or not it is necessary?
        And let me refer, right now we have 28,500 U.S. personnel,
    I believe, on the Korean Peninsula in South Korea. It seems
    that when the North Koreans get upset, it is when we do the
    major joint military exercises. And when we look at our allies
    across the globe, can't we better demonstrate our support for
    our commitments with them by doing periodic joint military
    exercises? For instance, four brigade combat teams in Europe at
    this point in time, is that really necessary?
        So I am wondering if there has been an ongoing analysis to
    determine the cost-effectiveness of redeploying those forces
    back to the United States.
        Secretary Gates. We have spent a lot of time on this. We
    have just completed a global posture review examining our
    positioning in Europe, our position in the Pacific and also in
    the Middle East. It is now being discussed in the interagency
    because obviously there are political implications for any
    changes.
        But I would tell you that we have examined this very
    closely, and we will probably make some adjustments. I think I
    mentioned in a speech that our force structure, as well as our
    rank structure in Europe, is still a legacy from the Cold War.
        But that said, I am a firm believer that our forward
    posture in Europe, in Asia, is fundamental to our alliance
    relationships. It provides them with the assurance that, in
    fact, we will be there, and we will support them, and I think
    dramatic changes in our overseas posture would be very
    destabilizing to a lot of these relationships.
        And I think that one of the reasons that, for example,
    South Korea and Japan have not tried to develop nuclear weapons
    of their own is because of their confidence that our presence
    in their country provides a trip wire and a guarantee that if
    they are attacked, the United States will support them.
        The Chairman. Thank you.
        Ms. Pingree.
        Ms. Pingree. Thank you, Mr. Chairman.
        Thank you for your testimony today and for your service. I
    appreciate it. And a couple of things, I also want to tell you
    I appreciate your stand on the second engine, and also was glad
    to hear your explanation and your thoughtful remarks about the
    continuing resolution. Coming from the State of Maine where
    people pay a lot of attention to the construction of DDGs, we
    are very interested in what is going to happen there, so I
    appreciate your bringing all of our attention to the importance
    of the challenges of a continuing resolution.
        And I also want to thank you for your remarks to
    Representative Tsongas. I, too, am very concerned about some of
    the issues around sexual harassment and am concerned that we
    haven't moved far enough. So I am glad you have taken her
    charge and think particularly, now that we have increased
    dependence on women in the military, we have to be very
    respectful of the issues that they are raising and the fact
    that it hasn't changed sufficiently to make women comfortable
    at serving their country.
        But my question is somewhat different. You brought this up
    earlier, and I want to talk about TRICARE. As you know and you
    stated, the U.S. Family Health Care Plan designed by Congress
    in 1996 provides the full TRICARE Prime benefit for military
    beneficiaries in 16 States and D.C. for over 115,000
    beneficiaries. Beneficiaries are highly satisfied with this
    option.
        I come from Maine, as I said. In Maine it is administered
    by Martin's Point Health Care, and they have a customer
    satisfaction rating of 93 percent. I have visited their
    facility. They stress preventive care. It is exactly the model
    that we want for health care in this country.
        As you have already mentioned, the President's budget
    request has a huge proposed change that would preclude
    enrollment in U.S. Family Health Plan for beneficiaries who
    reach 65 years of age, and if we enact that, it would
    immediately force over 3,000 military beneficiaries to
    disenroll from the plan they have chosen.
        First, I think this recommendation contradicts President
    Obama's position regarding health care reform, that you should
    be able to keep the plan you have if you are happy with it. But
    perhaps a greater concern, you mentioned a cost savings. This
    proposal would have a cost saving for DOD, but it really just
    shifts the costs to the Department of Health and Human
    Services. So I don't see how overall we are anticipating a cost
    savings as a whole, and I think it is going to be very
    detrimental to the beneficiaries.
        So can you address my concerns on this?
        Secretary Hale. Let me respond. First, there would be some
    net savings of government because we are paying these hospitals
    at significantly higher than Medicare rates. And part of the
    goal of this overall effort is that we treat all the hospitals
    similarly in terms of the rate paying.
        I also want to clarify, yes, we would--as people reached
    age 65, they would need to join TRICARE For Life. They could
    stay at the hospital where they were being treated. They
    wouldn't be required to leave that; they could use that as
    their primary provider. But they would need to do what every
    other retiree does in the Department of Defense when they reach
    age 65, and that is join the TRICARE For Life program.
        So we are trying to treat everybody the same. Yes, there
    would be savings, modest, to the government. And you are right,
    there are some costs shifted to Medicare. But there is a net
    savings because we would now be paying Medicare rates, and we
    are paying much higher.
        I also want to work with the hospitals involved. We are not
    looking to reduce the quality of care. We are phasing this in
    very slowly. It would be everybody in the program now is
    grandfathered, grandmothered. It is only as you come into the
    programs, so there would be very gradual change, and our goal
    is to be sure these hospitals, that their care is not harmed.
        Ms. Pingree. So just to follow up, it is my understanding
    that Public Law 104-201, section 726(b), which I am sure you
    are well aware of, mandates that government cannot pay more for
    the care of U.S. Family Health Care Plan enrollees than it
    would if a beneficiary were receiving care from other
    government programs.
        So it seems to me that we should already be paying
    equivalent of what Medicare costs are. And, again, I would just
    stress, based on observing my own TRICARE program--and I don't
    have any particular stake in it--but having been very involved
    in the health care debate, knowing how important preventative
    care is, knowing that there is very high customer satisfaction
    with that, but also it is a different model of care, I am just
    greatly concerned with shifting people out of that model if it
    doesn't really result in cost savings and if it is only a cost
    shift.
        I mean, for us, I know you have to look at your budget, but
    we have to look at the overall costs here. And if it is just
    going over to Medicare, and it is not a significant savings,
    and it goes back to an old model of care, not a new
    preventative model of care, I don't think we have improved care
    for these families.
        Secretary Hale. Well, we need to get with you. I am not
    familiar with the details of the provisions. I do know that
    there are some requirements we are not meeting in the sole
    community hospitals with regard to Medicare rates. And that may
    be that we are also proposing to move toward that, toward
    Medicare rates. So we need to get back to you on the details.
        [The information referred to was not available at the time
    of printing.]
        Secretary Hale. There would be some modest net savings to
    the government. We work carefully with OMB [Office of
    Management and Budget], and they fully support this proposal in
    terms of shifting the funds.
        Ms. Pingree. Thank you. I would be happy to follow up with
    you on that, so thanks.
        The Chairman. Thank you.
        Mr. Hunter.
        Mr. Hunter. Thank you, Mr. Chairman.
        Admiral, Mr. Secretary, sorry that I missed the last hour
    of testimony. I had to vote in markup.
        First question is this. Mr. Secretary, Mrs. Davis, my
    colleague from San Diego, when you were answering her
    questions, you talked about the defense budget. You talked
    about the total layouts and how this is the lowest point since
    the 1990s, since before World War II, where we are at the low
    part where we are at now, where there is so little being spent
    on defense.
        And I would argue and ask your opinion of this: If you
    don't give us a top line, if you don't ask for what it would
    cost to erase all risk, literally, or as much risk as possible,
    then we have no baseline to cut defense from or to add to
    really, because the numbers that we are using are limbo numbers
    really. Because if you were to fully fund defense--this is my
    question. If you were to fully fund defense and take away 100
    percent as best as you could, 100 percent of risk, using your
    own threat assessment tools and analysis, what would that
    funding be? What would you ask for?
        Secretary Gates. I have only half jokingly said in meetings
    in the Department that if we had a trillion dollar budget, I
    would still have unfunded requirements.
        Mr. Hunter. Yes, that is right.
        Secretary Gates. The services would still be able to come
    up with a list of things that they really need.
        I think that the budget that we have provided at $553
    billion for fiscal year 2012 mitigates risk to the extent that
    I think is reasonably possible, and I think that we have--we
    are investing in new capabilities. The $70 billion that the
    services are going to be able to invest from their savings in
    new capabilities or in added numbers, I think, help mitigate
    that risk.
        You can never reach a point--just as there is no such thing
    as perfect security, there is no such thing as eliminating
    risk.
        Mr. Hunter. Mr. Secretary, if I may, I am going to run out
    of time, and I have one more totally separate question. If you
    got to that highest point that you could where you start
    getting diminished rate of return, what would that number be,
    roughly?
        Secretary Gates. I think that we are at a point with the
    553- where we can do that.
        Mr. Hunter. Okay. So fully funding defense in every
    requirement is at 553-?
        Secretary Gates. We will never fund every request----
        Mr. Hunter. But if you did, sir, what I am asking is what
    that number might be.
        Secretary Gates. I have no idea how much it would be.
        Mr. Hunter. You haven't thought about what it would cost to
    really satisfy the requirements of all the different services?
        Secretary Gates. Nobody lives in that world.
        Mr. Hunter. No. But what you are supposed to do is tell us
    how we get to zero threat, and Congress then decides what to
    fund.
        Secretary Gates. And I am telling you, you are never going
    to get to zero threat.
        Mr. Hunter. Well, we could try.
        Secretary Gates. You could spend $2 trillion, and you will
    never get to zero threat.
        Mr. Hunter. But that is what we would like to hear from
    you, Mr. Secretary, is that if it cost $2 trillion, and we
    could cut that by 75 percent, and here we are at the 550-.
        All right. On a totally separate note, let us talk about
    Iraq for a minute. If the status of forces agreement is not
    changed, and/or the Iraqis don't ask for our help and ask us to
    stay, what is our plan for 2012? At the end of this year, what
    is going to happen?
        Secretary Gates. We will have all of our forces out of
    Iraq. We will have an Office of Security Cooperation for Iraq
    that will have probably on the order of 150 to 160 Department
    of Defense employees and several hundred contractors who are
    working FMS [Foreign Military Sales] cases.
        Mr. Hunter. Do you think that that represents the correct
    approach for this country after the blood and treasure that we
    have spent in Iraq, my own personal time of two tours in Iraq?
    There is going to be fewer people there than, that 150, than
    there are in Egypt right now, somewhere around 6-, 700 of those
    same types of folks in Egypt.
        How can we maintain all of these gains that we have made
    through so much effort if we only have 150 people, and we don't
    have any military there whatsoever? We would have more military
    in Western European countries at that point than we have in
    Iraq, one of the most central states, as everybody knows, in
    the Middle East.
        Secretary Gates. Well, I think that there is certainly, on
    our part, an interest in having an additional presence, and the
    truth of the matter is the Iraqis are going to have some
    problems that they are going to have to deal with if we are not
    there in some numbers. They will not be able to do the kind of
    job in intelligence fusion, they won't be able to protect their
    own airspace, they will not--they will have problems with
    logistics and maintenance.
        But it is their country, it is a sovereign country. This is
    the agreement that was signed by President Bush and the Iraqi
    Government, and we will abide by the agreement unless the
    Iraqis ask us to have additional people there.
        The Chairman. Thank you.
        Mr. Garamendi.
        Mr. Garamendi. Thank you, Mr. Chairman, Mr. Secretary and
    Admiral Mullen. Thank you so very much for your forthright and
    very compelling arguments.
        First I want to compliment you on going green. The Navy is
    doing extraordinary things, as are the other forces, and it is
    very, very important for your energy programs. I hope you
    continue that. I encourage you to do so, and many of us around
    here will do everything we can around here to support that
    effort.
        My question, though, goes to the Afghanistan war and
    Pakistan, and the question is this: Does our war in Afghanistan
    destabilize Pakistan; and, if so, what should we be doing about
    that problem in Pakistan?
        Secretary Gates. I don't believe that the war in
    Afghanistan is destabilizing to Pakistan. I think that what is
    destabilizing to Pakistan, among other things, is a group of
    terrorist--several terrorist organizations in the western part,
    northwestern part of Pakistan that are intent on destabilizing
    Pakistan and overthrowing its government. And I think our
    efforts, combined with the Pakistani efforts on both sides of
    the border, in fact, help reduce that terrorist risk to the
    Pakistanis.
        I think that extreme economic problems are a huge factor in
    Pakistan. So I don't think our presence in Afghanistan is
    destabilizing. In fact, I think it helps the Pakistanis long
    term.
        Mr. Garamendi. I will let it go at that. I am certainly not
    going to place my knowledge in intelligence ahead of yours, but
    there seems to be considerable others who would question that
    conclusion.
        Admiral.
        Admiral Mullen. Sir, I would say this is not a very stable
    region. I mean, that is part of the problem we have. Al Qaeda
    lives there, leadership lives there. They are still trying to
    kill as many Americans and Western citizens as they can.
        There are multiple terrorist organizations--I call it the
    epicenter of terrorism in the world--that are now working much
    more closely together than they have historically.
        So from my perspective, I try to talk about this as a
    region as opposed to one country or another. They are very much
    integrated in ways that sometimes they don't even like, but
    clearly they are.
        And so I think we have to have, and we seek, you know, a
    strategic partnership with both these countries, really the
    region, to look at long-term stability there. That is, from my
    perspective, whether we are at war at the level we are at right
    now or in the future when we have far fewer troops in the area,
    can we support stability in a way that doesn't endanger us in
    the long run, in addition to the citizens of those two
    countries?
        Mr. Garamendi. I thank you. I don't want to engage in a
    debate with you, so I will let it go at that and thank you for
    that information.
        My final question has to do with missile defense, which is
    significantly augmented in the budget. Why?
        Secretary Gates. Part of the half-billion dollar increase
    is to implement the phased adaptive array missile defense that
    we have agreed to in Europe; but also, frankly, to increase our
    ability to defend our ships and our troops against theater-
    level threats, missile threats.
        Hezbollah alone has 40,000 rockets and missiles at this
    point, including anti-ship cruise missiles that have a range of
    65 miles. So we are putting more money into Aegis-capable
    ships. We will have 41 of these by the end of 2016, 28 by the
    end of 2012. They defend our ships. They defend, have the
    potential to defend, our ground troops. We are developing
    additional generations of the Standard Missile-3 that have
    enhanced capabilities to deal with Iranian, North Korean and
    other kinds of missiles. And we are making baseline--continuing
    to make baseline investments in the Ground-Based Interceptor
    program, which protects the continental United States.
        So I think all of these are contributing to our own
    security, but also help protect our allies as well.
        Mr. Garamendi. Thank you.
        The Chairman. Thank you.
        Mr. Rigell.
        Mr. Rigell. Thank you, Mr. Chairman.
        Good afternoon, Secretary Gates, Secretary Hale and Admiral
    Mullen. In your chain of command, many, many levels down is my
    son. And I just want you to know on behalf of the Second
    District of Virginia, if it is, in fact, your last testimony
    before the House Armed Services Committee, that we are just
    really deeply, deeply grateful for your service. I know you
    have sacrificed a lot, and your families have, to allow you to
    serve in the way you have. I know that you are doing everything
    you can to accomplish the mission and to protect our young
    people. I thank you for that.
        I come from a private-sector background, and I have learned
    in life that communication is extraordinarily difficult and it
    is absolutely essential for an organization to succeed. And I
    don't speak for the committee, but just for myself. It sure
    seems to me that communication between the DOD and HASC is
    lacking, it is poor. I regret that I have to rate it that way.
        It is acute in our own district, in the Second District of
    Virginia, with respect to the disestablishment of JFCOM [Joint
    Forces Command]. Even today I have yet to receive the detailed
    analysis, the supporting documents, that would help me,
    representing the Second District, to properly understand and
    respond to the disestablishment of JFCOM, and that is
    disappointing to me. And I trust that we will move forward both
    on the House side and on the Pentagon side to improve, sharply,
    communication.
        One area that I would like to shift to here is TRICARE, and
    it is widely understood when someone enlists in the military
    that health care is for life, it is free. I have asked many
    people, I served in the Marine Corps Reserve myself, and just
    it is widely understood.
        And so as tempting as it is to look at that area as an area
    for cost savings, I truly believe, and I don't use these words
    lightly, that it is a breach of trust to change the deal
    because maybe we don't like the deal, or the government doesn't
    like the deal.
        Mr. Chairman, Admiral Mullen, what initiative, if any, is
    being undertaken to ensure or make a more full disclosure to
    those who are considering a military career with respect to
    benefits that may be offered at their retirement?
        Admiral Mullen. Honestly, when young people come in the
    military, they are 20-something, 17, 18, 19 years old. And
    certainly while the material is available, and recruiters may
    use this as something in terms of, you know, a health care
    plan, and I have talked about it to our young people forever, I
    think that the military health care plan is the gold standard
    in the country, quite frankly.
        But it is not something, at least I have found in those on
    Active Duty, they have focused heavily on, more so recently
    than in the past. But it is not something they focus on when
    they are that young. I didn't, and many others haven't.
        Mr. Rigell. Admiral, with all due respect, my time is so
    short.
        Secretary Gates. There is a larger point, so let me respond
    to this. Congress actually settled this issue in 1995, that it
    wasn't free for life. They imposed fees, and they imposed a fee
    of $460 a year. So the issue of whether it was free or not was
    settled by Congress in 1995.
        Once you have acknowledged that there is going to be a fee,
    the notion that the fee would never change is certainly nowhere
    in the legislation.
        Mr. Rigell. Well, Mr. Secretary, my question was what
    initiative, if any, was undertaken to ensure a full disclosure
    of those who are entering the service? I believe in full
    disclosure; I know we all do. And I am submitting to you today
    that, in countless conversations with our veterans, that there
    is a disconnect between what is being told by the recruiter and
    what reality is. And I just respectfully, as one American to
    another, am asking that that be addressed within the commands.
    It is not an expensive initiative. It would just be to ensure
    better disclosure.
        You know, as we look--and I will close with this. As we
    look at the profound challenges that are facing our military
    that you have discussed today and the shortage of funds for
    ship repair, for shipbuilding, the reduction in end strength,
    troop levels, it is just stunning to me--and, I think, a
    misplaced priority--that we are still talking about sending a
    carrier to Mayport, which is a risk that is minimal and could
    be mitigated with far less funds than it takes to move that
    carrier to Mayport. And I would ask you to reconsider that,
    respectfully.
        Thank you.
        The Chairman. Mrs. Hanabusa.
        Mrs. Hanabusa. Thank you, Mr. Chairman.
        Thank you, Mr. Secretary, and thank you, Admiral, for being
    here.
        I have a basic question regarding the budget. I read, I
    thought I read it correctly in the budget documents from the
    President, that the total amount of outlay was about $700
    billion. And I do know that 553- is the base budget, and Mr.
    Secretary has said that. And the Overseas Contingency Operation
    budget of about 117-, plus or minus, I think, is not included
    in the base, if I am reading that correctly. But I am still
    short about $30 billion. So do you know where that $30 billion
    is?
        Secretary Hale. I need to get with you and see where the
    numbers are. There are various ways of adding up the budgets.
    The figures we are discussing here are 051. You could be
    including the National Nuclear Security Administration figures
    in there, which is something called function 050.
        I don't know if we want to take a lot of time here, but I
    would be glad to get with you, and we will sort out the numbers
    for you.
        Mrs. Hanabusa. Please do. But the 553- and the 117- is
    correct, though. We are not just really talking about 553----
        Secretary Hale. Yes. That is the DOD portion of the budget.
    But as I say, there are various ways of adding this up.
        Mrs. Hanabusa. Thank you very much.
        Mr. Secretary, Congresswoman Bordallo has left, but I am
    also very curious about the position with Okinawa. And I have
    read what was given to us beginning on page 15 and continuing
    on to page 16.
        There seems to not be a firm statement about what Japan's
    position is, and I think one of the things that is pointed out
    is that the $472 million for Guam was not included in, I guess,
    the Japanese budget.
        So how critical is their contribution to what happens? And
    I kind of would like to know, as best as I can, what is the
    bottom line? Are they going to move from Okinawa? Are they not
    going to move? It looks like a reduction of about 10,000 troops
    from Okinawa. So what do we plan to do?
        Secretary Gates. First of all, the Japanese actually have
    fulfilled all their commitments to date. They have given us, I
    think, a little over $700 million for infrastructure. When I
    was there, they told me they were putting together a program
    that will include something on the same order of further
    infrastructure investments.
        And as I mentioned earlier, we really can't go forward on
    Guam. In fact, the Congress has withheld money for going
    forward on Guam until we have greater clarity on what happens
    on Okinawa.
        My hope is, based on my conversations in Japan, that we
    will have some resolution of this by later this spring or early
    this summer, and then we will be able to come to you with our
    plans. But absent--absent resolution of the Futenma replacement
    facility issue, our troops aren't coming out of Okinawa, land
    is not being returned to the Okinawans, and we have to sort of
    start all over again.
        But I do believe we will find some positive resolution to
    the Futenma issue.
        Mrs. Hanabusa. So when you say the Futenma issue and the
    resolution of where the troops are going to go, are you talking
    about within Okinawa itself or some variation of Okinawa and
    Guam?
        Secretary Gates. On Okinawa itself.
        Mrs. Hanabusa. On Okinawa itself?
        And finally, this whole concept of end strength, I want to
    know whether that is some kind of a magical number into the
    future, to a time specific, or is that something that we are
    looking at given the information that we have today?
        Secretary Gates. It is basically looking at the information
    that we have today.
        And, as I have said, the end strength in 2015 and 2016
    will, at the end of the day, be determined by the conditions in
    the world and, above all, have we come out of Afghanistan, by
    and large, by the end of 2014. That would enable us to have a
    lower end strength.
        Now, as we have talked about in this hearing, the Marine
    Corps believes that it needs to come down about 15,000 because
    they think they have gotten too big and too heavy in terms of
    their equipment. So this is a proposal that actually is
    divorced from the budget and is more based on the Marine Corps'
    own view of their force structure and what they need to
    complete their mission going forward.
        Mrs. Hanabusa. And how about the other services? Do they
    share----
        Secretary Gates. The only other service affected at this
    point is the Army. And, again, depending on the circumstances,
    the Army leadership supports this proposal, but the Army
    leadership is also fully aware that they will have the
    opportunity to revisit this decision if conditions in the world
    change.
        Mrs. Hanabusa. Thank you.
        The Chairman. We have one, two, three, four, five Members
    that have been waiting patiently now for 3 hours, and we just
    got the first series of votes called, and I am concerned that
    they will go for 45 minutes or an hour. And I know, Mr.
    Secretary, you said that you had until 1:30. I appreciate that
    you have given us that time, but I think we only have time
    probably for one more.
        Mr. Gibson.
        Mr. Gibson. Thank you, Chairman, and I thank the
    distinguished panelists for their leadership and for being here
    today. And I also want to express my admiration for all the men
    and women that you lead and for their families on what they do
    on behalf of our freedom.
        I also would like to express my appreciation for the budget
    submission, not easy work, and I have some experience in it,
    and I know it has been challenging for the team, especially in
    relation to the last decade with regard to prioritization. I
    look forward to being supportive going forward.
        My concern has been touched on here today, but I would like
    to address it more directly, and it has to do with, generally,
    requirements and resources, but, more broadly, with the
    prefacing discussion of what kind of country we are, what
    interests we have, or what commitments we think are appropriate
    for a republic.
        You know, I think on this committee there would be wide
    agreement and beyond that we need to protect our cherished way
    of life, and that we need the world's best military to do that,
    but I think there is a wide variety of views and opinions as to
    precisely what that means. Some believe that we should embrace
    some kind of isolationism; others, perhaps, a near endless
    global commitment strategy.
        I reject the extremes of both sides. I personally think
    that we are overcommitted and that we ask too much of our
    military, but it is a debatable point. Which gets to my point.
    We have processes, NDP, the QDR, primarily for internal or D.C.
    consumption, when I think it really needs to be more of a
    national conversation.
        I know you both travel widely and you speak. I am curious
    to know, does this topic come up when you are with the American
    people, and what ideas that you have, if you agree, that this
    should be more of a national discussion going forward?
        Admiral Mullen. Well, I have traveled fairly extensively
    over the course of the last year, and I have found, and I worry
    about, the sort of growing disconnect between the American
    people and the military. And I don't mean that--I mean, they
    are enormously supportive of our men and women and their
    families. They know we are in two wars. They know we are
    sacrificing enormously as well.
        More and more, we come from 40 percent fewer places. I
    mean, we are 40 percent smaller than we were in 1989. We have
    BRACed [Base Realignment and Closure] out of many parts of the
    country. And so our day-to-day connections are significantly
    reduced from what they used to be. And it is the breadth and
    the depth of understanding of who we are and what we are doing,
    the number of deployments, sacrifices of the family, the
    changes that have occurred over the course of the last decade.
        So it is not going to happen overnight, but it is a long-
    term concern that I have. And particularly when you overlay
    that with the enormous fiscal challenges that the country has
    right now, it is one of the reasons I have talked about--I
    actually do think the debt is a huge issue for national
    security, because we are going to be affected by that. You can
    see it in this budget. It is going to continue to happen.
        So that is probably the worry, and having a conversation
    with America about those challenges, and particularly
    individuals who serve, then go on to return to communities
    throughout the country, the veterans issues. I mean, we see an
    increasing homeless population in our veterans, increasing
    number of female homeless veterans, for example. How do they
    return to--you pick the area. They are enormously capable
    people. They are wired to serve in the future. They will make a
    big difference. They are 20-something. But how do we invest
    just a little bit in them so that, taking advantage of the GI
    bill, they will then take off and make a huge difference in the
    future? And I think they will. That connection is something
    that I think is really important.
        Secretary Gates. But at the end of the day, Mr. Gibson,
    from our perspective, the dialogue, the conversation that you
    are describing is a dialogue that needs to take place between
    the executive branch and the legislative branch. You represent
    the American people. You have your finger on the pulse of the
    people in your district better than any of us ever could. And
    so, as was intended by the Founders, we basically rely on you
    as the surrogates for the American people in terms of that
    dialogue.
        Mr. Gibson. I appreciate the comments, and I do believe
    that it is an area that we are going to need to address. And I
    look forward to working with the DOD and also the chairman and
    the committee moving forward.
        And I yield back.
        The Chairman. Thank you very much.
        Mr. Secretary, Admiral, thank you again for being here, for
    your service. And this committee stands adjourned.
        [Whereupon, at 1:12 p.m., the committee was adjourned.]

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                                A P P E N D I X

                               February 16, 2011

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                  QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                               February 16, 2011

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                       QUESTIONS SUBMITTED BY MR. MCKEON

        The Chairman. On January 6th you stated that this budget request,
    ``Represents, in my view, the minimum level of defense spending that is
    necessary given the complex and unpredictable array of security
    challenges the United States faces around the globe.'' You went on to
    explain why further cuts to force structure would be calamitous.
        However, last year you indicated that given topline real growth of
    approximately 1%, force structure and modernization accounts need to
    grow by 2-3% beyond 2015 to prevent cuts to force structure. The budget
    request before us does not achieve that level of topline growth.
          How will you maintain the level of modernization you
    believe is necessary to protect our national security?
          Does this budget request guarantee cuts to force
    structure beyond 2015, as you predicted might happen?
        Secretary Gates. [The information was not available at the time of
    printing.]
        The Chairman. What was the 2016 end strength for the Army and the
    Marine Corps presumed by the QDR and during development of the national
    military strategy?
          Going forward, what specific metrics will the Department
    use to evaluate the decision to reduce Army and Marine Corps end
    strength?
          How will this reduction in end strength affect the
    objective of 1:3 dwell time for the active force?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                        QUESTIONS SUBMITTED BY MR. SMITH
        Mr. Smith. The US Family Health Plan designed by Congress in 1996
    provides the full TRICARE Prime benefit for military beneficiaries in
    16 states and the District of Columbia for over 115 thousand
    beneficiaries. Beneficiaries are highly satisfied with this health care
    option. In fact, the Committee understands that in 2010 over 91% of US
    Family Health Plan beneficiaries were highly satisfied with the care
    they received, making it the highest rated health care plan in the
    military health system.
          The FY 12 President's Budget Request includes a proposed
    legislative provision that future enrollees in US Family Health Plan
    would not remain in the plan upon reaching age 65. Do you realize that
    this proposal would eliminate access for our beneficiaries who are
    elderly and in the most need of health care from the highest rated
    health care plan in the military?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Smith. Public Law 104-201 Sec 726(b)) mandates the Government
    cannot pay more for the care of a US Family Health Plan enrollee than
    it would if that beneficiary were receiving care from other government
    programs. Is DOD in compliance with that provision? If you are not in
    compliance with the law or disagree with the above, please explain. Is
    the proposal simply to shift cost to Medicare?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Smith. The US Family Health Plan provides prevention and
    wellness programs as well as effective disease and care management
    programs designed to care for beneficiaries' health care needs over
    their lifespan. Given the longitudinal approach of the program in
    managing the health care needs of the US Family Health Plan
    beneficiaries, and the Department's interest in the medical home model,
    why would you not consider expanding such innovative techniques in
    health care delivery?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Smith. The proposed legislation, if enacted, would force future
    enrollees to disenroll from this effective and well managed program
    upon reaching age 65. The remaining beneficiaries would be at risk
    because the ability to sustain disease management and prevention
    programs would be compromised, effectively removing the option of
    continued participation in this plan. Is this consistent with the DOD's
    stated priorities of population health, improved health management and
    continuity of care?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

           QUESTIONS SUBMITTED BY MR. SMITH ON BEHALF OF MS. GIFFORDS
        Mr. Smith. DOD Operational Energy Strategy
          As a follow-up to the 29 Sept 2010 letter (attached)
    issued by the Committee (to Sec Gates) last year, how is the Department
    achieving efficiencies in Operational Energy, saving lives and taxpayer
    dollars by saving fuel?
          In his 1 Nov 2010 response (attached) Secretary Gates
    stated he would be releasing the Department of Defense's Operational
    Energy Strategy. What is the status of this report and anticipated date
    of release?
        Secretary Gates and Admiral Mullen. [The information was not
    available at the time of printing.]
        Mr. Smith. Operational Renewable Electricity
          Following the impressive success of the USMC's
    Afghanistan Experimental Forward Operating Base (ExFOB), what steps is
    the Department taking to increase the use of renewable energy sources
    in the battlefield?
          How much does the ExFOB cost?
          What advantage do portable renewable energy sources add
    to mission effectiveness?
          Is the rest of the expeditionary force doing something
    similar?
          What are the barriers to successful wide-spread
    deployment of ExFOB-like technologies?
          What is the strategy, cost, and timeline of such a
    deployment?
        Secretary Gates and Admiral Mullen. [The information was not
    available at the time of printing.]
        Mr. Smith. Renewable Electricity Goals
          The National Defense Authorization Act (NDAA) of 2007
    directed DOD to produce or procure 25% of all electricity consumed by
    the Department from renewable energy sources by 2025. What is the
    Department's strategy for achieving this goal? What impediments does
    the Department foresee to achieving this goal?
        Secretary Gates and Admiral Mullen. [The information was not
    available at the time of printing.]
        Mr. Smith. Energy Research and Development
          What is the Department of Defense's energy investment
    strategy for R&D? Specifically:
            o  implementing high efficiency drive technologies, such as
            hybrid drive, into tactical vehicles;
            o  increasing the energy efficiency of facilities in garrison
            and in theater; and
            o  developing alternative fuels.
          How does the Department coordinate R&D efforts between
    each of the Services, DOD agencies such as DARPA, and independent
    Service research labs such as the Office of Naval Research and the Air
    Force Research Lab? And, how do they coordinate investments with DOE to
    avoid duplication--particularly under the auspices of the DOD/DOE MOU?
        Secretary Gates and Admiral Mullen. [The information was not
    available at the time of printing.]
                                     ______

                      QUESTIONS SUBMITTED BY MR. BARTLETT
        Mr. Bartlett. After your appearance before the committee, your
    public affairs office sent the following email on February 16,
    regarding the subject of the undated, unsigned, and unsolicited
    documents on the subject of the JSF alternate engine sent by your
    legislative affairs office to select Members of Congress on February 14
    and 15: ``The Department, through its office of Legislative Affairs,
    routinely provides papers to members of Congress and their staffs, to
    inform them of the Department's position on important issues. Because
    of the nature of those documents (fact sheets and information papers),
    they are not normally signed or dated. While the Secretary may not be
    aware of these routine communications, the documents themselves
    represent the Secretary's and Department's position. His, and our,
    opposition to the F-35 extra engine is well-known and a matter of
    record. These documents are not inconsistent with our previous public
    statements.''
          Please provide the committee a list of all unsolicited,
    undated and unsigned background or information papers provided by your
    Department to select members of Congress during 2010 and 2011. Please
    provide the subject matter, the approximate date, and the members'
    names, and to whom the information papers were sent.
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Bartlett. In your testimony, in responding to a question
    regarding the F-35 alternate engine, you made a statement that the F-18
    and F-22 engines come from a single source. Also, a Department of
    Defense (DoD) information paper provided to select members of Congress
    the day before the House of Representatives voted on an amendment to
    strike funding for the F-35 competitive engine stated: ``A single
    engine is not a new approach and does not create unacceptable levels of
    risk. The Department maintains two current tactical aircraft programs,
    the F-22 and the F/A-18/F, which both utilize a single engine
    provider.''
        The F-22 and F/A-18 are twin engine aircraft. The F-35 is a single
    engine aircraft. As you are aware, there are significant differences in
    design and operational requirements for engines intended to power
    single engine aircraft from those that are designed to power multi-
    engine aircraft. We understand that engines designed to power single
    engine aircraft require component and software redundancies; increased
    component reliability; higher production quality standards; and larger
    air start envelope requirements.
        Also, as we understand it, only two U.S. military operational
    aircraft are single engine aircraft: the Air Force F-16 and the Marine
    Corps AV-8B. The F-16 was the first aircraft to use an alternate
    engine, beginning in the mid-80s and still does so today. According to
    DOD information, accident rates for the F-16 have trended from 14
    mishaps/100,000 flight hours in 1980 with the Pratt & Whitney engine,
    when the alternate engine program was first funded, to less than 2
    mishaps/100,000 flight hours in 2009 for both the Pratt & Whitney and
    GE engines. A review of DOD AV-8B accident data last year by the
    committee indicated an accident rate (FY 05-09) six times that of the
    other Navy fighter aircraft (F-18) and over 3 and \1/2\ times the rate
    of the F-16 (FY 04-08). The AV-8B will be replaced by the F-35B. It
    will not be operational until at least 2016. The Institutes for Defense
    Analysis estimated in 2007 that up to 95 percent of the U.S. fighter
    fleet could be composed of F-35 aircraft by 2035.
        No fighter aircraft engine has ever been required to do what the F-
    35 engine is required to do--provide powered flight and also power a
    lift fan for the short takeoff and vertical landing F-35B. You have
    indicated that you have placed the F-35B on ``probation,'' requiring
    redesign of the F-35B unique engine components. The current estimate to
    complete development of the F135 primary engine has been extended
    several years and the estimated cost to complete the development
    program is 450 percent above the February 2008 estimated completion
    cost. Five months into fiscal year 2011, the fiscal year 2010 engine
    contract has yet to be signed. The F-35 primary engine has, as of the
    end of 2010, 680 total flight test hours and has 90 percent of its
    flight testing to go.
          What were the planned initial operational capability
    dates for the F-35A, B, and C when you testified before our committee
    last year? What were the planned initial operational capability dates
    for the F-35A, B, and C as of July 2010? What are the current planned
    initial operational capability dates for the F-35A, B, and C?
          Do you believe your testimony and the DOD information
    paper provide a balanced representation of the risks in programs costs
    as well as operational risks to DOD of dependence on a single engine
    source for the F-35 aircraft for up to 95 percent of the future U.S.
    fighter fleet?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Bartlett. In your testimony, in responding to a question
    regarding the F-35 F135 alternate engine, you made a point that the F-
    35 primary engine is a derivative of the F-22 F119 engine.
        We understand the Systems Development and Demonstration (SDD) for
    the F-35 F135 engine was to have been completed in FY 08 and still has
    several years to go to complete development. We also understand SDD for
    the F135 primary engine is now 70 percent over the original 2001
    estimated cost, been slipped several years, and is 450 percent over the
    estimated cost to complete since the FY10-to complete estimate of
    February of 2008.
          When the F119/F135 engine entered Systems Development and
    Demonstration (SDD) were any of the ground or flight test requirements
    waived because the F135 ``is a derivative of the F-22 engine?''
          Dr. Carter directed an Integrated Manufacturing Readiness
    Review of the F135 contractor in 2009 because of concerns over
    escalating costs and parts production productivity. If the F135 is a
    derivative of the F119 why do you believe the review team discovered
    several of the major components for the F135 with manufacturing
    readiness levels of 3 and 4, when low rate initial production of the
    engine had begun in fiscal year 2007?
          If the F135 is a derivative of the F-22 engine, why do
    you believe the completion of testing has been delayed and costs have
    continued to increase for development?
          What was the planned development time period for the
    F135? How long has the F135 been in development and how many more years
    of development are required?
          What was the original estimate for the cost of F135
    development and what is the current FY12 -to-complete, development?
          Is the Department able to segment planned and actual
    development costs for the F135 and those solely associated with the
    lift fan and associated components? If so, please provide that
    information to the committee.
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Bartlett. In testimony before the Senate Armed Services
    Committee on February 17, 2011, you were quoted as stating: ``The Air
    Force version flew twice as many flight tests as had been originally
    planned.''
        My understanding from DOD sources is that the F-35A flew 171
    flights in 2010 versus a planned 112 flights, 53 percent more than
    planned, not 100 percent more than planned, as you are quoted as
    saying.
          Could you provide the committee the correct information
    on the issue of planned versus actual flight tests sorties flown by the
    F-35A test aircraft in 2010?
          Under the FY 2007 F-35 flight test schedule, when DOD
    requested funds to initiate F-35 production, how many flights should
    have been flown from the beginning of the F-35 test program through
    December 2010 and what were the actual number of flight tests flown
    (please show AA-1 separately)?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Bartlett. A Department of Defense (DoD) information paper
    provided to select members of Congress the day before the House of
    Representatives voted on an amendment to strike funding for the F-35
    competitive engine stated: ``. . . the F136 engine is already three to
    four behind in its development phase.''
        The last information provided to the committee, in April 2010,
    indicated the F136 engine was two to three months behind its originally
    planned development schedule, not three to four years.
        We understand the original acquisition strategy for the F-35 engine
    was to award two separate sole source engine contracts, four years
    apart, using a leader-follower acquisition strategy, the first contract
    being awarded to P&W for the F135 in 2001; the second contract being
    awarded to GE for the F136 in 2005, 46 months apart.
        The November 8, 2000 DOD F-35 acquisition strategy stated: ``The
    contract strategy for the JSF119 [now F135] propulsion system entails a
    single, sole source contract to P&W. P&W will complete propulsion
    system development in FY08.'' JSF Acquisition Strategy, 8 November
    2000. The acquisition strategy document also stated: ``The contract
    strategy for the alternate JSF F120 [now F136] propulsion system
    entails awarding a single, sole source contract . . . in FY 05 . . . ''
    JSF Acquisition Strategy, 8 November 2000. Finally the acquisition
    strategy stated: ``This competitive engine environment will ensure
    long-term industrial base support with two production lines and will
    keep JSF engine costs down and reliability up.''
        An April 12, 2010, response to question for the record, March 24,
    2010, Hearing before the Air and Land Forces and Seapower subcommittees
    of the House Committee on Armed Services stated: ``The original F135
    contract signed 26 October 2001 had an initial service release set for
    November 2007.'' That objective was met 24 months late: ``The current
    F135 program has achieved conventional takeoff and landing ISR the 1st
    quarter FY2010 [October-December 2009] and short takeoff and vertical
    landing ISR is planned for 4th quarter FY2010 . . . The F136 is 2-3
    months behind schedule to the original plan.''
        The current estimate to complete development of the F135 primary
    engine has been extended several years and the estimated cost to
    complete the development program is 450 percent above the February 2008
    estimated completion cost.
        Five months into fiscal year 2011, the fiscal year 2010 engine
    contract has yet to be signed.
        The F-35 primary engine has, as of the end of 2010, 680 total
    flight test hours and has 90 percent of its flight testing to go.
        What has been the level of funding obligated, including other
    government costs, for the F136 development from FY 07 to date, by
    fiscal year, and what was the level of funding determined by the F-35
    Joint Program Office as being required, including other government
    costs, by fiscal year, to maintain the F136 development schedule.
          Do you believe the DOD information paper provides a
    balanced representation of the F-35 acquisition strategy and F136 and
    F135 development schedules?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Bartlett. A Department of Defense (DoD) information paper
    provided to select members of Congress two days before the House of
    Representatives voted on an amendment to strike funding for the F-35
    competitive engine stated: ``A 2010 update of the 2007 cost benefit
    analysis concluded, through very optimistic assumptions, that the
    second engine is currently at the breakeven point in net present
    value.''
        In testimony before the Air and Land Forces and Seapower
    Subcommittees of the House Committee on Armed Services on March 24,
    2010, the Honorable Christine Fox, Director of the Cost Assessment and
    Program Evaluation Office [CAPE], Office of the Secretary of Defense,
    was asked by Representative Jim Marshall regarding her testimony that
    the DOD 2007 cost benefit analysis on the F-35 engine program used
    ``optimistic assumptions'': ``So back in 2007, were you trying to prove
    a case or were you just trying to do a study?'' Ms. Fox responded: ``We
    were trying to do a study, sir.'' In addition, the 2007 DOD engine cost
    benefit analysis cites six sources that it indicates were
    methodologically consistent with the 2007 DOD study, including RAND,
    the Institute for Defense Analysis, The Analytical Services
    Corporation, and the Defense Systems Management College.
        The GAO has noted that key assumptions in the Pentagon's estimate
    of the $2.9 billion six year cost to complete the F136 competitive
    engine and prepare for competition were unnecessarily pessimistic based
    on historic experience with the original alternate engine program.
    ``Those assumptions were (1) 4 years of noncompetitive procurements of
    both engines would be needed to allow the alternate engine contractor
    sufficient time to gain production experience and complete
    developmental qualification of the engine, and (2) the government would
    need to fund quality and reliability improvements for engine
    components. Past studies and historical data we examined indicate that
    it may take less than 4 years of noncompetitive procurements and that
    competition may obviate the need for the government to fund component
    improvement programs. If these conditions hold true for the alternate
    engine, the funding projection for the alternate engine could be lower
    than DOD's projection.''
          Do you believe the DOD information paper provides a
    balanced representation of the F-35 engine acquisition strategy and
    F136 and F135 development schedules?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Bartlett. In your testimony, in responding to a question
    regarding the F-35 alternate engine, you stated the F-35 alternate
    engine is ``two to three years behind [the primary engine].''
        The last information provided to the committee by DOD, in April
    2010, indicated the F136 engine was two-to-three months behind its
    originally planned development schedule, not ``two to three years
    behind.''
        We understand that the original acquisition strategy for the F-35
    engine was to award two separate sole source engine contracts, four
    years apart, using a leader-follower acquisition strategy, the first
    contract being awarded to P&W for the F135 in 2001; the second contract
    being awarded to GE for the F136 in 2005, 46 months apart.
        The November 8, 2000 DOD F-35 acquisition strategy stated: ``The
    contract strategy for the JSF119 [now F135] propulsion system entails a
    single, sole source contract to P&W. P&W will complete propulsion
    system development in FY08.'' JSF Acquisition Strategy, 8 November
    2000. The acquisition strategy document also stated: ``The contract
    strategy for the alternate JSF F120 [now F136] propulsion system
    entails awarding a single, sole source contract . . . in FY 05 . . .''
    JSF Acquisition Strategy, 8 November 2000. Finally, the acquisition
    strategy stated: ``This competitive engine environment will ensure
    long-term industrial base support with two production lines and will
    keep JSF engine costs down and reliability up.''
        An April 12, 2010, response to question for the record, March 24,
    2010, Hearing before the Air and Land Forces and Seapower subcommittees
    of the House Committee on Armed Services stated: ``The original F135
    contract signed 26 October 2001 had an initial service release set for
    November 2007.'' That objective was met 24 months late: ``The current
    F135 program has achieved conventional takeoff and landing ISR the 1st
    quarter FY2010 [October-December 2009] and short takeoff and vertical
    landing ISR is planned for 4th quarter FY2010 . . . The F136 is 2-3
    months behind schedule to the original plan.''
        The current estimate to complete development of the F135 primary
    engine has been extended several years and the estimated cost to
    complete the development program is 450 percent above the February 2008
    estimated completion cost.
        Five months into fiscal year 2011, the fiscal year 2010 engine
    contract has yet to be signed.
        The F-35 primary engine has, as of the end of 2010, 680 total
    flight test hours and has 90 percent of its flight testing to go.
        What has been the level of funding obligated, including other
    government costs, for the F136 development from FY 07 to date, by
    fiscal year, and what was the level of funding determined by the F-35
    Joint Program Office as to be required, including other government
    costs, to maintain the F136 development schedule.
          Do you believe your testimony before the committee
    provided a balanced representation of the F-35 engine acquisition
    strategy and F136 and F135 development schedules?
        Admiral Mullen. [The information was not available at the time of
    printing.]
        Mr. Bartlett. In responding to the question on the F-35 alternate
    engine, you said ``there have been multiple airplanes that are single-
    engine airplanes that are single source.''
        The F-22 and F/A-18 are twin engine aircraft. The F-35 is a single
    engine aircraft. We understand that only two U.S. military operational
    aircraft are single engine aircraft: the Air Force F-16 and the Marine
    Corps AV-8B. The F-16 was the first aircraft to use an alternate
    engine, beginning in the mid-80s and still does so today. DOD
    information indicates accident rates have trended from 14 mishaps/
    100,000 flight hours in 1980 with the Pratt & Whitney engine, when the
    alternate engine program was first funded, to less than 2 mishaps/
    100,000 flight hours in 2009 for both the Pratt & Whitney and GE
    engines. A review of the AV-8B DOD accident data last year indicated an
    accident rate (FY 05-09) six times that of the other Navy fighter
    aircraft (F-18) and over 3 and \1/2\ times the rate of the F-16 (FY 04-
    08). The AV-8B will be replaced by the F-35B. The F-35 is a single
    engine aircraft. It will not be operational until at least 2016. The
    Institutes for Defense Analysis estimated in 2007 that up to 95 percent
    of the U.S. fighter fleet could be composed of F-35 aircraft by 2035.
        No fighter aircraft engine has ever been required to do what the F-
    35 engine is required to do--provide powered flight and also power a
    lift fan for the short takeoff and vertical landing F-35B. Secretary
    Gates placed the F-35B on ``probation,'' requiring redesign of the F-
    35B unique engine components. The current estimate to complete
    development of the F135 primary engine has been extended several years
    and the estimated cost to complete the development program is 450
    percent above the February 2008 estimated completion cost. Five months
    into fiscal year 2011, the fiscal year 2010 engine contract has yet to
    be signed. The F-35 primary engine has, as of the end of 2010, 680
    total flight test hours and has 90 percent of its flight testing to go.
          Do you believe your testimony provides a balanced
    representation of the risks in programs costs as well as operational
    risks to DOD of dependence on a single engine source for the F-35 for
    up to 95 percent of the future U.S. fighter fleet?
          How many single engine fighter aircraft, by type and
    quantity, are there in the U.S. inventory at present and what percent
    of the primary active and total active inventory do they represent of
    the total fighter force?
          Please provide the major/Class A accident rates for these
    aircraft for the past five and ten years through FY 10 or CY2010. Also,
    please provide the major/Class A accident rates for these aircraft for
    the past five and ten years, with the primary cause being the engine,
    through FY/CY 10. Finally, please provide what the experience has been
    with the DOD single engine aircraft with regard to groundings related
    to the engine of more than one aircraft at a time?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                      QUESTIONS SUBMITTED BY MS. BORDALLO
        Ms. Bordallo. I have re-introduced the compromise version of H.R.
    44 which eliminates the payment of claims to descendants of those that
    suffered personal injury during the occupation. Can we expect the same
    level of support from the Department of Defense as we did in the 111th
    Congress? The people of Guam are being asked to provide additional land
    for a firing range and the main base area and resolution of Guam war
    claims is going to be critical to overcoming historical injustices.
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Bordallo. U.S. Force Realignment in Japan
          Given the strategic importance of Guam and our nation's
    on-going efforts to re-shape our military presence in the Pacific
    theater, can you tell me what the status is of the Department of
    Defense's roadmap for realigning U.S. forces in Japan?
          Specifically, how is the reconfiguration of the Camp
    Schwab facilities and the adjacent water surface areas to accommodate
    the Futenma Replacement Facility project proceeding?
          When can we expect to see tangible progress on Okinawa
    for a Futenma Replacement Facility?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Bordallo. I was pleased to see about $200 million in research
    and development for a next generation bomber. I think this is a key
    platform to maintaining a robust long range strike capability.
          Can you explain the rationale behind your decision to
    build a long range manned bomber with the ability to penetrate defended
    air space?
          Why is standoff insufficient to meet future Combatant
    Command requirements?
          What are the inherent limitations within our existing
    legacy bomber fleet?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Bordallo. Army & Marine Corps Equipment Reset
          Please put the Fiscal Year 2012 budget request for
    equipment reset for the Army and Marine Corps in context with the
    Fiscal Year 2011 President's budget request and the continuing
    resolution being discussed today, or if the Department were forced to
    continue with a year-long Continuing Resolution at Fiscal Year 2010
    funding levels.
          Please discuss the movement of depot maintenance funding
    from Overseas Contingency Operations to the base budget.
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Bordallo. What guidance were the services given to distinguish
    between base and O-C-O budget reset?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Bordallo. Given the high level of attention the CENTCOM theater
    continues to receive due to on-going combat operations, I am concerned
    that we may have inadvertently created unnecessary risk in our Pacific
    Theater readiness, capabilities, and particularly in our I-S-R capacity
    because of a CENTCOM focus.
          Given the number of threats in the Pacific area of
    operations what are we doing to address these risks?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. MILLER
        Mr. Miller. Affordable F-35 recapitalization is dependent on
    capturing economies of commonality and scale as quickly as possible.
    Yet, basic economics tells us that if you continue to reduce the number
    of aircraft, unit costs will grow. This does concern me.
          What actions will the Department take to help ensure that
    this critical 5th generation aircraft does not quickly become another
    B-2 or F-22?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Miller. You expressed the Department's support for an
    amphibious assault capability for the Marine Corps, and suggested that
    a plan exists to fill that capability gap; however, we have been asked
    to cancel the EFV without seeing a detailed plan for replacing the 40+
    year old AAV. The Marine Personnel Carrier does not offer a ship-to-
    shore capability, and the obsolete AAV is incapable of providing the
    swift, over the horizon delivery needed to conduct amphibious
    operations in the face of modern threats.
          When will we see a detailed plan for an AAV replacement?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                      QUESTIONS SUBMITTED BY MR. HEINRICH
        Mr. Heinrich. I was pleased to see the FY12 budget reflect the
    Administration's commitment to modernizing the nuclear weapon
    infrastructure.
        The $1.2 billion increase over FY10 will make the necessary
    investments to ensure our laboratories have the resources they need to
    maintain our nuclear deterrent while helping secure loose nuclear
    material around the world.
        This is in stark contrast to the Continuing Resolution which
    includes a $325M cut to weapons activities and a $647M cut to nuclear
    nonproliferation.
          How would the funding levels included in the CR impact
    NNSA's modernization plans and our ability to meet our obligations
    under the New START Treaty?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Heinrich. I also have serious concerns about how the CR will
    impact civilian assistance on the ground in Afghanistan.
        The State Department and the U.S. Agency for International
    Development would face over a 20 percent reduction when compared to the
    President's FY11 request.
          How would the funding levels in the CR impact the front
    lines in Iraq, Afghanistan and Pakistan where our civilians are working
    side by side with our military?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. WILSON
        Mr. Wilson. Your proposal includes several measures aimed at
    reducing the cost of providing health care to our service members and
    their families and military retirees. While I appreciate that your plan
    is a more comprehensive approach than previous cost cutting efforts,
    the challenge here is finding the balance between fiscal responsibility
    while maintaining a viable and robust military health system. We must
    be sure to remember these proposals have complex implications and go
    `beyond beneficiaries.' They also will affect the people such as
    pharmacists, hospital employees and vendors who support the defense
    health system. The military health system has a robust acquisition
    workforce within the TRICARE Management Activity that appears to
    replicate the acquisition expertise in other Defense agencies such as
    the Defense Acquisition, Technology and Logistics and Defense Logistic
    Agencies.
          Why does the military health system need its own
    acquisition workforce?
          How much money would you save by embedding medical
    expertise in existing Defense acquisition agencies?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                    QUESTIONS SUBMITTED BY MR. RUPPERSBERGER
        Mr. Ruppersberger. Regarding the cancellation of the F-22, given
    the recent Chinese developments, please discuss the recent developments
    in 5th generation technologies and the need to invest in 5th gen
    aircraft.
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Ruppersberger. F-35 is slated to ramp up production to over 20
    aircraft a month. Given that the Independent Manufacturing Review Team
    you chartered came to the conclusions that the industry team is
    currently capable of producing between 48 and 60 aircraft per year and
    that a production ramp up of 1.5X per year is optimum, please discuss
    the decision to produce only approximately 32 aircraft for three
    straight years?
         Does this achieve production efficiency?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. TURNER
        Mr. Turner. Though the National Nuclear Security Administration
    (NNSA) falls under the Department of Energy and it's largely non-
    security budget, can you please discuss NNSA's role in meeting our
    nation's national security needs?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. In your preface to the April 2010 Nuclear Posture
    Review, you ``asked for nearly $5 billion to be transferred from the
    Department of Defense to the Department of Energy over the next several
    years.'' Can you discuss why this was necessary and how you prioritize
    this investment?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. As stated in the April 2010 Nuclear Posture Review,
    President Obama ``has directed a review of potential future reductions
    in U.S. nuclear weapons below New START levels.''
          Have you received such direction?
          What conditions would the Department of Defense need to
    see met in order to consider further reductions beyond New START
    levels?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. When the White House announced the Phased Adaptive
    Approach (PAA) to missile defense in Europe last September, it said the
    new approach was based upon an assumption that the long-range missile
    threat was ``slower to develop.'' However, in comments last month, you
    both expressed concern about the pace of North Korea's ICBM and nuclear
    developments.
          Do you have a similar assessment of Iran's missile and
    nuclear programs?
          Also, as discussed in the Ballistic Missile Defense
    Review, what hedging strategy will you pursue to defend the U.S.
    homeland in case the threat comes earlier or the new Next Generation
    Aegis Missile has technical problems?
          At what point would the Department make a decision to
    employ the hedge?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. In 2006, the Director of National Intelligence issued a
    five-year strategic human capital plan that pointed to a number of gaps
    in mission-critical areas of analysis and human intelligence. Among the
    recommendations, the report called on looking at the needs of the
    ``total force''--including civilians, military members, contractors,
    and international and academic partners.
          What is the Defense Department doing to meet the growing
    demands for trained military, civilian, and contractor workers who
    perform intelligence analysis?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. Research and development, testing, and training for
    Unmanned Aerial Systems to meet national defense needs have been
    hampered for many years by lack of special use airspace. Of course, the
    safety of our airspace is paramount. But there is a growing feeling
    that national defense needs are being compromised by this impasse.
          What is the Department of Defense doing to expedite the
    integration of UAS into the National Airspace?
          Do you recommend any changes in regulation, statute, or
    agreements between the Defense Department and the FAA in order to
    expedite the process--to meet both safety and national defense needs?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. The National Defense Authorization Act of 2008 required
    that a flexible personnel practice available to one defense laboratory
    under the Laboratory Personnel Demonstration Project should be
    available for use at any other laboratory.
          Can you tell us how many defense laboratories have taken
    advantage of this provision?
          How can the Department better implement this authority to
    improve the flexibility of personnel practices in Defense laboratories?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. Recent Department of Defense reports indicate an
    increase in sexual assaults in the Armed Services and Military
    Academies. This increase highlights an urgent need for improvements to
    the way Defense Department officials respond to sexual assault cases.
    Below is a list of improvements that I feel are necessary to safeguard
    against military sexual assault and protect its victims.
          What is the Department's position on providing the
    following rights to victims of sexual assault (please explain):
            o  Victim Access to Judge Advocate General (JAG) and privileged
            communication with a Victim Advocate.
            o  Professionalize and standardize sexual assault programs
            based on what we have already learned from the success of Equal
            Employment Opportunity program at the DOD.
            o  Require a Sexual Assault training module at each level of
            Professional Military Education (PME).
            o  Provide a mechanism for expedited consideration and priority
            for base transfers.
            o  Provide a system of data collection on sexual assaults,
            reported assaults, and for the ongoing quality of performance
            of victims after the assault.
            o  Giving a victim advocate more independence from the victim's
            chain of command.
            o  Adopt measures that truly create separation between the
            victim and the alleged perpetrator at the base level, and not
            merely accept separation ``on paper.''
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Turner. As stated in the April 2010 Nuclear Posture Review,
    President Obama ``has directed a review of potential future reductions
    in U.S. nuclear weapons below New START levels.''
          Have you received such direction?
          What conditions would the Department of Defense need to
    see met in order to consider further reductions beyond New START
    levels?
        Admiral Mullen. [The information was not available at the time of
    printing.]
        Mr. Turner. When the White House announced the Phased Adaptive
    Approach (PAA) to missile defense in Europe last September, it said the
    new approach was based upon an assumption that the long-range missile
    threat was ``slower to develop.'' However, in comments last month, you
    both expressed concern about the pace of North Korea's ICBM and nuclear
    developments.
          Do you have a similar assessment of Iran's missile and
    nuclear programs?
          Also, as discussed in the Ballistic Missile Defense
    Review, what hedging strategy will you pursue to defend the U.S.
    homeland in case the threat comes earlier or the new Next Generation
    Aegis Missile has technical problems?
          At what point would the Department make a decision to
    employ the hedge?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. JOHNSON
        Mr. Johnson. Do you believe your successor should commit to
    following the recent efficiency initiative with further efficiency
    drives to maintain momentum in cost-cutting and reform of the
    Department of Defense?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Johnson. Do you anticipate that any U.S. forces will remain in
    Afghanistan in 2017? If you do not explicitly answer in the
    affirmative, I will presume that the Department of Defense plans and
    anticipates to remove all U.S. forces from Afghanistan by 2017.
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Johnson. I am aware you have outlined several criteria for
    reconciliation of Taliban and anti-government forces in Afghanistan,
    including renunciation of al Qaeda, acceptance of the Afghan national
    constitution, and renunciation of violence.
          Can you provide detailed information regarding specific
    reconciliation outreach efforts to Taliban fighters for each ISAF
    Regional Command?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Johnson. Can your end force strength goals for the middle of
    the next decade be reconciled with your commitment to fairer dwell
    times for our men and women in uniform?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Johnson. Do you assess that cancelling the F-35 second engine
    program would pose any operational risk in the event the primary engine
    were stricken by unforeseen, widespread failures?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Johnson. When will DDG-1000 hulls #2 and #3 be put under
    contract?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Johnson. Why will full ship shock trials of the Littoral Combat
    Ship not be conducted on hulls #1 or #2, in light of persistent
    questions raised by the Department of Operational Testing & Evaluation
    regarding whether LCS meets its Level 1 Survivability requirements?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Johnson. General Spencer on January 14, 2011, stated the
    importance of securing the ``global commons'' as a defense priority of
    the U.S., signaling our continued commitment as the world's primary
    defender of key trade routes.
          How can we share this burden among our allies and
    emerging powers to spare the U.S. taxpayer from footing the full bill
    for global security?
        Admiral Mullen. [The information was not available at the time of
    printing.]
        Mr. Johnson. Is less than 200 F-22s adequate to ensure U.S. air
    superiority for the next three decades?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                        QUESTIONS SUBMITTED BY MR. KLINE
        Mr. Kline. The United States Government has been operating from the
    same NRO Charter for 46 years. I understand the Department intends to
    produce a Directive rather than a Charter as required. We began this
    process over 2 years ago. The Charter was not delivered by the February
    1, 2010 deadline. In last year's Armed Services Committee defense
    posture hearing (February 3, 2010), I asked you when the Department
    intended to complete the Charter. I am concerned that it has been more
    than a year, and a Charter has still not been delivered in accordance
    with legislative requirements. Our committee has received conflicting
    information from the Department as to whether we will receive the
    Charter, a DOD Directive in place of the Charter, or no additional
    product whatsoever because the MOA essentially serves as the Charter.
    The law requires a Charter, not an MOA or Directive.
          The FY10 NDAA required the Department of Defense and the
    DNI to submit a revised NRO charter by Feb 1, 2010 to the Committee on
    Armed Services. It is now 2011, where is the Charter?
          If the Department intends to comply with the law, when
    will the actual Charter be delivered to the Committee?
          If the Department will issue a product other than the
    Charter, please provide that intent in writing as well as details on
    when the Committee should expect to receive such a product.
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MS. SUTTON
        Ms. Sutton. I'd like to hear from you about funding levels for the
    DOD Office of Corrosion Policy and Oversight and how the budget
    reflects the importance of this issue. A key component of modernizing
    our infrastructure, preserving our military assets, and saving money in
    the process is adopting a robust corrosion prevention and mitigation
    strategy. It is not a glamorous topic, but it's one that is worth our
    time and attention, especially given the potential savings if we
    address it in a smart and appropriate way.
          Given the demonstrated successes of this corrosion
    office, how do you foresee the proposed funding level supporting the
    future role of this office, and what are the intentions for the
    evolution of this work within DOD in the future?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Sutton. The Navy estimates that executing the 30-year
    shipbuilding plan would require an average of $15.9 billion per year,
    however a May 2010 Congressional Budget Office (CBO) report estimates
    that figure to be an average of $19 billion per year--or about 18% more
    than the Navy estimates. The CBO report states that if the Navy
    receives an average of about $15 billion a year in 2010 dollars in the
    next 30 years--it will not be able to afford all the purchases in the
    2011 shipbuilding plan.
          Given the proposals for minimal to no real budget growth
    in the upcoming years, are you concerned with the Navy's ability to
    reach its required force structure? How will this affect the Navy's
    shipbuilding plan?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Sutton. I believe that one of our priorities should be to
    consider how our decisions and policies impact the welfare of service
    members and their families. Reduced dwell time and stop loss are two
    situations that have caused much strain for our military. One of the
    proposals is the reduction of the permanent end strength of the Active
    Army and Marine Corps.
          Do you anticipate that these cuts will reduce the amount
    of dwell time for our soldiers or risk a return to the utilization of
    the stop-loss for our soldiers?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Ms. Sutton. I believe that one of our priorities should be to
    consider how our decisions and policies impact the welfare of service
    members and their families. Reduced dwell time and stop loss are two
    situations that have caused much strain for our military. One of the
    proposals is the reduction of the permanent end strength of the Active
    Army and Marine Corps.
          Do you anticipate that these cuts will reduce the amount
    of dwell time for our soldiers or risk a return to the utilization of
    the stop-loss for our soldiers?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. FRANKS
        Mr. Franks. When the Phased Adaptive Approach was first introduced,
    deadlines for each phase were set under the impression that long-range
    missile threats were ``slow to develop.'' Recently you made remarks
    that suggest North Korea's ICBM and nuclear developments are proceeding
    faster than expected. This raises concerns that the PAA will not be
    available to defend against long-range ICBMs before North Korea
    develops this capability.
          In the interim, there must be a hedging strategy. Please
    identify the hedging strategy you will pursue to defend our Nation's
    Homeland in the event that North Korea or another rogue nation acquires
    ICBM capability earlier than expected or if the new Next Generation
    Aegis Missile has technical problems.
            o  Particularly, does the GMD two stage interceptor remain a
            realistic and flexible hedge against these advancing threats?
            o  Also, what is the timeline for a decision on this strategy?
          Furthermore, do you have an assessment of other nations'
    timeline of achieving ICBM and nuclear capabilities able to threaten
    our homeland, particularly Iran's program.
            o  If not, what is being done to make an accurate assessment of
            their developments?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Franks. Concerns about whether the New START Treaty limited
    missile defense figured prominently in the Senate's debate on the
    Treaty. You both continue to engage in missile defense discussions with
    your Russian counterparts.
          Please describe the nature of those discussions and what
    you see as areas of concern.
            o  Particularly, do you find the lack of agreement in the
            interpretation of the preamble as having unforeseen
            consequences for a Missile Defense Capabilities?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Franks. The Ground-based Midcourse Defense (GMD) system in
    Alaska and California is currently the only missile defense system that
    protects the United States homeland from long-range ballistic missile
    attacks. However, the last two flight intercept tests of the GMD system
    failed to achieve intercept.
          What actions and/or investments do you believe are
    necessary to ensure GMD is a reliable and operationally effective
    system to protect the U.S. homeland against evolving threats?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Franks. Have you seen any changes among our allies in Europe or
    elsewhere on their view of U.S. extended deterrence and the role the
    U.S. nuclear weapons in providing that extended deterrence guarantee?
    If so, please discuss these changes.
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Franks. Concerns about whether the New START Treaty limited
    missile defense figured prominently in the Senate's debate on the
    Treaty. You both continue to engage in missile defense discussions with
    your Russian counterparts.
          Please describe the nature of those discussions and what
    you see as areas of concern.
            o  Particularly, do you find the lack of agreement in the
            interpretation of the preamble as having unforeseen
            consequences for a Missile Defense Capabilities?
        Admiral Mullen. [The information was not available at the time of
    printing.]
        Mr. Franks. The Ground-based Midcourse Defense (GMD) system in
    Alaska and California is currently the only missile defense system that
    protects the United States homeland from long-range ballistic missile
    attacks. However, the last two flight intercept tests of the GMD system
    failed to achieve intercept.
          What actions and/or investments do you believe are
    necessary to ensure GMD is a reliable and operationally effective
    system to protect the U.S. homeland against evolving threats?
        Admiral Mullen. [The information was not available at the time of
    printing.]
        Mr. Franks. Have you seen any changes among our allies in Europe or
    elsewhere on their view of U.S. extended deterrence and the role the
    U.S. nuclear weapons in providing that extended deterrence guarantee?
    If so, please discuss these changes.
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. SHUSTER
        Mr. Shuster. I applaud you for your decision not to proceed to
    procurement of the MEADS missile defense system. As noted in the DOD
    memo, the program is substantially over budget and behind schedule. It
    would take an additional $974M just to complete the Design and
    Development of the program. It does not make sense to continue to waste
    $800 hundred million on a system we are not going to procure.
          Will DOD go back to the drawing board and try to find a
    way to ring out some additional savings out of this $800M for MEADS?
    Will you ask your team to brief me on what this $800M is for, and if we
    can least find some more substantial savings?
          The DOD memo indicates that it will be necessary to
    allocate funds for Patriot upgrades. At a minimum, will DOD work to
    reallocate funds for Design and Development for upgrades to the Patriot
    system?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Shuster. In the Memo accompanying your recent decision not to
    proceed to procurement of MEADS, you specifically highlighted the
    Army's inability to afford to procure MEADS and make required Patriot
    upgrades as rationale for the decision. I agree wholeheartedly with
    that assessment and commend you on your decision. It is vital that we
    continue to upgrade the Patriot system, which can provide added
    capability much sooner and at a fraction of the cost.
          In light of your decision and the vital importance of air
    and missile defense; can you please provide any insight on accelerating
    Patriot modernization?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Shuster. Azerbaijan is an important partner of the United
    States and Israel in the region. It has contributed troops and
    resources to our missions in Afghanistan, Iraq and Kosovo; and the
    country is a key component of the Northern Distribution Network.
    Azerbaijan was first to open Caspian energy resources to U.S. companies
    and has emerged as a key partner for diversifying European energy
    markets. Azerbaijan also cooperates closely with the United States in
    the areas of intelligence sharing, counterterrorism, non-proliferation
    of weapons of mass destruction, and counternarcotics trafficking. The
    importance of Azerbaijan will only continue to grow, particularly given
    rising tensions with Iran.
          How would you describe the current level of military
    cooperation between the United States and Azerbaijan, as well as your
    future expectations for that cooperation? What steps must the United
    States and Azerbaijan take to further strengthen this relationship?
          Section 907 of Freedom Support Act of 1992 limits the
    U.S. Government's ability to provide direct assistance to the
    Government of Azerbaijan. In what ways does this interfere with the
    Department of Defense's long-term planning regarding Azerbaijan and its
    efforts to deepen bilateral relations with respect to security and
    defense matters?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. CONAWAY
        Mr. Conaway. Regarding the F-35 alternate engine, both the
    Pentagon's F-35 acquisition strategy documents, one completed 10 years
    ago and an update completed 2 years ago noted:
            ``to preclude excessive reliance on a single engine supplier,
            an alternate engine program was established.''
        The F-35 acquisition strategy document published in December 2008,
    nearly three years after the Pentagon quit requesting funding for the
    F136 stated that:
            ``dependent on F136 propulsion system maturity and funding
            availability . . . the goal is to reach full competition
            between Pratt & Whitney and GE in FY12 or 13''
        In addition, the most recent business case analysis completed by
    the Department of Defense indicated the competitive engine is at the
    breakeven point in net present value.
          Given the Department's acquisition strategy documents'
    concerns on excessive reliance on a single contractor to provide the F-
    35 engine, the stated goal of reaching full competition between the two
    manufacturers, and the business case analysis stating it was no more
    expensive to have a competitive engine, why are you so opposed to the
    alternate engine?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Conaway. In January, you announced a significant reduction in
    the original order for F-35s for the FYDP. According to your statement,
    a reduction of 124 F-35s, bringing the total to 325, will pay for the
    $4.6 billion needed to extend the development period and adding
    additional flight tests. You further stated that an additional $4
    billion from this reduction will be used for other purposes, such as
    acquiring more F/A-18s, one of the planes the F-35 is supposed to
    replace. Furthermore, you have stated the impact of removing 124 F-35 A
    & C variants from the FYDP will have little impact to unit cost over
    the life of the program. I am concerned about the impact to unit cost
    this reduction will have to the remaining A and C variants throughout
    the FYDP.
          Given the information about the progress of the Chinese
    stealth fighter aircraft technology, what is the justification for
    cutting 124 fifth generation F-35s and buying 41 additional obsolete
    fourth generation aircraft?
          Please comment on the immediate or near term cost impacts
    of the reduction?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Conaway. In the recent restructuring of the F-35 program, the
    F-35B, was put on a two year probation. It is my understanding that the
    technical issues on this variant appear to be typical at this stage in
    a development program.
          Would you remove the F-35B variant from probation before
    the FY13 budget submission if the aircraft's performance improves?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Conaway. The requirement for the ship to shore distance for the
    Expeditionary Fighting Vehicle was 25 miles. Now, the Marine Corps and
    the Navy have stated the requirement now is more like 12 to 25 miles.
          Can you please elaborate for the committee what the new
    ship to shore requirement will be for a potential New Amphibious
    Vehicle?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. COFFMAN
        Mr. Coffman. What steps is the Department of Defense taking to
    eliminate our military's dependence on China for critical rare earth
    elements? How is the Department of Defense helping to reestablish a
    viable domestic supply chain?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Coffman. The FY2011 National Defense Authorization Act required
    a report that evaluates supply options, determines aggregate defense
    demand, and establishes a plan to address vulnerabilities in the area
    of rare earth elements. The Defense Logistics Agency (DLA) Strategic
    Materials Stockpile--formerly the national stockpile center--has a
    successful program that can easily include stockpiling critical rare
    earth metals and alloys.
          What thought have you given to this?
          Do you agree that the DLA office has a key role to play
    in the required report and plan?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Coffman. In November 2010, I was informed by senior Department
    of Defense officials that our reliance on China for rare earth oxides,
    metals, alloys, and magnets did not constitute a national security
    threat. Officials from the Office of Industrial Policy noted that the
    Department of Defense was a small user and that they could not
    aggregate the Department's demand and usage of these materials.
          If the Department of Defense uses 7% of total rare earth
    demand, as noted by senior officials, aren't you still concerned if you
    cannot access that 7%?
          DoD representatives noted that new sources of supply for
    rare earth elements will be coming online in late 2011 and 2012. Has
    the Office of Industrial Policy taken note that the majority of this
    new supply is committed to non-U.S. sources such as Japan, who may not
    provide this material to the U.S. defense supply-chain, instead opting
    to supply the larger commercial market?
          If so, how can you conclude there is no national security
    risk if you cannot guarantee access to the rare earth oxides, metals,
    alloys, and magnets needed by the Department of Defense?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Coffman. Given that we are engaged in two protracted wars, how
    would you characterize the performance and practicality of the all-
    volunteer force?
          Do you have any concerns regarding the future of the all-
    volunteer force?
        Secretary Gates. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. GRIFFIN
        Mr. Griffin. Section 1243 of the Ike Skelton National Defense
    Authorization Act for FY11 states: ``The Secretary of Defense shall
    develop a strategy to be known as the `National Military Strategy to
    Counter Iran.' '' Among other requirements, the NDAA mandates that this
    strategy ``undertake a review of the ability of the Department of
    Defense to counter threats to the United States, its forces, allies,
    and interests from Iran,'' and specifically requires the Secretary to
    brief Congress within 180 days of the NDAA's enactment ``regarding any
    resources, capabilities, or changes to current law'' he believes are
    necessary to address any gave identified in the strategy.
          Is the Joint Staff currently preparing this strategy,
    which will be a high priority for this committee and receive as much or
    greater attention as any military report we receive?
          Will we receive this report within the mandated 180 day?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                       QUESTIONS SUBMITTED BY MR. PALAZZO
        Mr. Palazzo. The Navy estimates that its average annual
    shipbuilding requirement is $15 billion per year to attain its minimum
    floor of 313 battle-force ships. However the Congressional Budget
    Office (CBO) estimates that the Navy will require, on average, $19
    billion per year to attain its minimum floor of 313 ships.
          Given that there will be minimal to no real budget growth
    in the upcoming years, are you concerned with the Navy's ability to
    reach its required force structure?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Palazzo. As you know, the Chief Financial Officers Act of 1990
    requires that all Federal Agencies perform a financial audit each year.
    The DOD has not complied and even the Government Accountability Office
    (GAO) has labeled the DOD's books as ``unauditable'' because of the
    complexity of this problem. Many people view this as a complete lack of
    accountability and transparency in one of our Government's largest
    agencies. Now colleagues of mine have even introduced legislation to
    cut portions of the DOD budget until the audits are complete.
          Has there been any recent attempt to correct this
    problem, change the accounting systems or develop a course of action to
    get this problem fixed? Is it reasonable to expect a full audit in the
    foreseeable future?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Palazzo. The role of the US military in recent years has had an
    increased focus on humanitarian response missions such as earthquake
    response in Haiti and response to the Indonesian tsunami. These
    contingency efforts, particularly by the Navy and Marine Corps due to
    their specific strengths and mobility, are changing the role of the
    force.
          Given these new requirements, what do you see as the
    future of the Navy and Marine Corps?
          Does this new focus on humanitarian missions weaken the
    force and our capability to respond to emerging threats such as China?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Palazzo. It is no secret that our National Guard has played an
    extremely important role in our military operations over the last
    decade, and as a national guardsman, I believe in the importance of
    thanking my fellow citizen soldiers and the families that make
    sacrifices every day to protect our great nation. In the past,
    proposals have been introduced to add a representative of the National
    Guard to the Joint Chiefs.
          Do you believe that this is a feasible and logical
    addition?
          How do you believe that adding a representative to the
    Joint Chiefs will affect the service chiefs and the role of the
    National Guard?
          Do you foresee any additional costs associated with this
    change?
        Admiral Mullen. [The information was not available at the time of
    printing.]
        Mr. Palazzo. The role of the US military in recent years has had an
    increased focus on humanitarian response missions such as earthquake
    response in Haiti and response to the Indonesian tsunami. These
    contingency efforts, particularly by the Navy and Marine Corps due to
    their specific strengths and mobility, are changing the role of the
    force.
          Given these new requirements, what do you see as the
    future of the Navy and Marine Corps?
          Does this new focus on humanitarian missions weaken the
    force and our capability to respond to emerging threats such as China?
        Admiral Mullen. [The information was not available at the time of
    printing.]
                                     ______

                        QUESTIONS SUBMITTED BY MR. YOUNG
        Mr. Young. Our budget constraints are significant. ADM Mullen has
    described our debt as our nation's ``greatest national security
    challenge.''
        Within this environment, President Obama has proposed an increase
    in our defense budget--albeit a slight increase--over FY10 enacted
    levels. This comes on top of a doubling of defense expenditures over
    the last 12 years, in real inflation-adjusted dollars.
        Meanwhile, ADM Mullen's comments indicated that we ``must face the
    reality of less spending by our partners.'' Essentially, our allies are
    cutting spending and, one might say, free-riding off of our military
    investments.
        We, understandably, don't want to use our military to do more
    without more, or even ask it to do more with less.
          In light of our growing fiscal challenges and steady
    investments in defense, and steady disinvestment in defense by our
    allies, how do you respond to those who argue that our ambitions now
    outstrip our capacities to fund them at home and abroad?
          Aside from creating conditions for more robust economic
    growth, including reforming our nation's entitlement programs, might we
    also address the gap between our ambitions and capacities by scaling
    back our global commitments--i.e., by setting priorities among missions
    rather than by layering additional missions on top of existing missions
    (as we have done in recent history)?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Young. Regarding the alternate engine of the F-35, the Joint
    Strike Fighter (JSF), how do you refute the findings of the GAO study
    (GAO-09-711T, May 20, 2009) that savings generated from having a
    competitive engine would recoup or exceed investment costs across the
    life cycle of the engine, and that its non-financial benefits were
    enough to continue the program, even if considering only marginal
    financial benefits?
        Secretary Gates. [The information was not available at the time of
    printing.]
        Mr. Young. Considering that 95 percent of our fighter force is
    projected to be comprised of F-35s within the next 25 years, how do you
    answer to concerns that our operational capabilities could be
    drastically compromised, as we would have very little redundancy in our
    fighter force, as we would be dependent upon one engine and vulnerable
    to a fleet-wide grounding?
        Secretary Gates. [The information was not available at the time of
    printing.]