[Senate Hearing 115-]
[From the U.S. Government Publishing Office]



 
       DEPARTMENT OF DEFENSE APPROPRIATIONS FOR FISCAL YEAR 2019

                              ----------                              


                        TUESDAY, APRIL 24, 2018

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:00 a.m. in room SD-192, Dirksen 
Senate Office Building, Hon. Richard Shelby (chairman) 
presiding.
    Present: Senators Shelby, Collins, Murkowski, Blunt, 
Daines, Hoeven, Durbin, Murray, Reed, Tester, Schatz, and 
Baldwin.

                         DEPARTMENT OF DEFENSE

                         Department of the Navy

                        Office of the Secretary

STATEMENT OF THE HON. RICHARD V. SPENCER, SECRETARY


             opening statement of senator richard c. shelby


    Senator Shelby. The committee will come to order. Today I'm 
pleased to welcome Secretary Spencer, Admiral Richardson, and 
General Neller to the committee for an update on U.S. naval 
operations and to review the fiscal year 2019 budget request 
for the Navy and Marine Corps.
    For fiscal year 2019, the Navy and Marine Corps are 
requesting $194.1 billion, which is an increase of about $4.5 
billion over amounts appropriated in 2018, and it's consistent 
with the 2-year budget deal passed earlier this year. The 
funding level in this request is still below what the Navy had 
projected for the upcoming year before the Budget Control was 
passed in 2011.
    Secretary Mattis has warned, and I'll quote, that ``failure 
to modernize our military risks leaving us with a force that 
could dominate the last war, but be irrelevant to tomorrow's 
security.''
    The increase is a necessary first step to reverse the harm 
to our military by 5 years of sequestration budgets. Today, 
there are over 100,000 sailors and Marines and more than 100 
ships forward deployed, including three aircraft carriers and 
three amphibious assault ships.
    Our Nation has tasked our Navy and Marine Corps with 
assuring access to the world's oceans and far-away regions 
while defending our interests in those areas, protecting U.S. 
citizens across the globe, and preventing the adversaries from 
using the world's oceans against us.
    Gentlemen, we look forward to your testimony and working 
with you during this appropriation process to meet the needs of 
the Department of the Navy in an increasingly complex strategic 
environment.
    [The statement follows:]
            Prepared Statement of Senator Richard C. Shelby
    Good morning, the Subcommittee will come to order.
    I am pleased to welcome Secretary Spencer, Admiral Richardson and 
General Neller to the committee for an update of U.S. Naval operations, 
and to review the fiscal year 2019 budget request for the Navy and 
Marine Corps.
    For fiscal year 2019, the Navy and Marine Corps are requesting 
$194.1 billion, which is an increase of about $4.5 billion over amounts 
appropriated for fiscal year 2018, and is consistent with the 2-year 
budget deal passed earlier this year. However, the funding level in 
this request is still below what the Navy had projected for the 
upcoming year before the Budget Control Act was passed in 2011.
    Secretary Mattis has warned that ``failure to modernize our 
military risks leaving us with a force that could dominate the last 
war, but be irrelevant to tomorrow's security.''
    This increase is a necessary first step to reverse the harm to our 
military by 5 years of sequestration budgets.
    Today there are over 100,000 sailors and Marines and more than 100 
ships forward deployed--including three aircraft carriers and three 
Amphibious Assault Ships.
    Our Nation has tasked our Navy and Marine Corps with assuring 
access to the world's oceans and far-away regions, while defending our 
interests in those areas, protecting U.S. citizens across the globe, 
and preventing adversaries from using the worlds' oceans against the 
United States.
    Gentlemen, we look forward to your testimony and working with you 
during the appropriations process to meet the needs of the Department 
of the Navy in an increasingly complex strategic environment.
    Now I turn to the Vice Chairman, Senator Durbin, for his opening 
remarks.
    Senator Shelby. Senator Durbin.

                 STATEMENT OF SENATOR RICHARD J. DURBIN

    Senator Durbin. Thank you very much, Mr. Chairman.
    And thanks to the witnesses who are appearing today. I want 
to thank Secretary Spencer, Admiral Richardson, and General 
Neller.
    Last year, the Navy lost the lives of 17 sailors in fatal 
accidents involving the USS Fitzgerald and the USS John S. 
McCain. Petty Officer Second Class Stephen Palmer, of 
Harristown, Illinois, a 23-year-old interior communications 
electrician, was among those lost on the McCain. The incident 
investigations concluded both collisions happened because of 
human error aboard the ships at unacceptable readiness levels. 
This was an embarrassment for the Navy and for our Nation. 
These incidents should never have happened, but they did. The 
Navy and the Nation collectively took our eyes off the ball.
    Admiral Richardson, you immediately accepted responsibility 
for these tragedies. That's important. You undertook serious 
efforts to get to the bottom of what happened with the 
Comprehensive Review.
    Secretary Spencer, you also completed a separate review of 
the Navy's overall readiness.
    Collectively, these reviews recommended over 80 corrective 
actions for the Navy to implement to restore safety and 
readiness. It's not going to be easy, it will take some time 
and resources and leadership, and the recent omnibus provided 
several funding increases to tackle these problems. We're ready 
to do more if needed. During today's hearing, I look forward to 
learning more about the progress that we've made to date and 
what's in the Navy's fiscal year 2019 request to accomplish the 
extensive list of reforms.
    Looking forward, the Navy is seeking to grow its 
capabilities. Last year, the NDAA (National Defense 
Authorization Act) set the goal of a 355-ship Navy, adding 
scores of ships to the Navy while working to fix these systemic 
readiness problems. That's a significant challenge.
    General Neller, the Marine Corps is called upon to do an 
awful lot with limited financial resources and many aging 
vehicles and weapons. I understand your priority is 
modernization, but we also want to hear about your efforts to 
recruit and retain the very best Marines that America has to 
offer. This committee and today's panel needs to have a candid 
discussion about Marine Corps readiness and additional 
resources we need to provide.
    Finally, let me say--I mentioned this to each of you on an 
individual basis--it's a shame that you have to deal with 
Congress sometimes--I know you think that privately-- and the 
appropriations process, and the fits and starts and the ups and 
downs. Compared to the fiscal year 2017, last fiscal year, 
enacted budget of $174.1 billion, we have a virtual increase in 
2018 of almost 10 percent in 1 year. We're projecting an 
increase of 2 percent next year. And then the year 2020 we 
can't even tell you what will be given by Congress or whether 
it will be an increase or held steady or even a cut. It's very 
difficult for anyone, a family, a company, certainly the United 
States Navy and Marine Corps, to budget with that uncertainty 
in the future and not to make serious mistakes, over-investing 
in some areas, under-investing in others. I'd like to have a 
little time during the course of this hearing to ask your 
thoughts on that challenge that lies ahead.
    Thank you, Mr. Chairman.
    Senator Shelby. We welcome again all of you to the 
committee today.
    Mr. Secretary, we will start with you. All of your written 
testimony will be made part of the record in its totality. You 
can proceed.

              SUMMARY STATEMENT OF HON. RICHARD V. SPENCER

    Secretary Spencer. Yes, sir.
    Chairman Shelby, Vice Chairman Durbin, distinguished 
members, I want to thank you for the opportunity to come here 
today and present to you the posture of the Department of the 
Navy. It truly is a pleasure for me to be sitting here with 
Admiral Richardson and General Neller, who, over the past 9 
months, truly have become my business partners as we address 
the Title 10 issues facing the Department of the Navy.
    I also want to say that on behalf of the Navy and the 
Marine Corps, I want to thank you for the effort put forth by 
Congress and your colleagues addressing the bipartisan 
agreement to support the President's budget. We are completely 
cognizant of the fact that it puts some people into the far 
extent of their comfort zones, we're aware of that, and we are 
greatly appreciative. Know that we will spend these resources 
in the most responsible manner that we can. We look forward to 
receiving those funds and those resources as soon as possible 
to enhance the readiness and lethality of your team, all the 
while expending them focused on the National Defense Strategy.
    Today, 94,000 sailors and Marines are forward deployed, 
stationed around the globe, using the maritime commons as their 
medium of maneuver, ensuring the maritime lanes of commerce 
remain free and open, assuring access to overseas regions, 
defending key interests in those areas, protecting United 
States citizens abroad, and preventing adversaries from 
leveraging the world's oceans against us, and they're doing 
this 24 hours a day, 365 days a year.
    Our budget request enhances readiness and continues 
increasing the capability and capacity of the Navy-Marine Corps 
team. As directed in a 2018 National Defense Strategy, our 
budget submission supports a more lethal, resilient, and agile 
force, able to deter and defeat aggression by pure competitors 
and other adversaries in all domains across the conflict 
spectrum.
    My priorities for the Department center on three 
categories: people, capabilities, and process. The ability to 
accomplish our mission relies on our people. 800,000 sailors 
and Marines, active duty, reserve, civilian teammates and their 
families comprise this team. We are building a more lethal, 
agile, talented, and rapidly innovating workforce as we speak. 
The ability to accomplish our mission relies on having 
capabilities necessary to fight tonight, challenge competitors, 
deter our rivals, and win. We are investing in the 
modernization of key capabilities and new technologies to keep 
that goal in sight.
    Lastly, the ability to accomplish our mission relies on 
having efficient processes in place that will speed value and 
ability to support our warfighters in a more effective and 
efficient manner. We're creating a continuous improvement 
mindset in both our culture and our management systems to 
deliver performance with ability and speed.
    I deliver to you a plan today with a sense of urgency. We 
cannot and will not allow our competitive advantage to erode. 
With your guidance, these planned investments will--I beg your 
pardon--provide combat-credible, maritime forces for the 
future. We will ensure that we are good stewards, and we will 
drive efficiency across the Department to maximize every 
dollar, invest smartly, to leverage the return on our 
investments. I look forward to your questions.
    [The statement follows:]
             Prepared Statement of Hon. Richard V. Spencer
    Chairman Shelby, Vice Chairman Durbin, distinguished members of the 
Committee, thank you for the opportunity to appear before you today to 
testify regarding the Department of the Navy (DON) 2019 President's 
Budget request (PB19).
    First, on behalf of our Sailors and Marines, I would like to 
express gratitude for the efforts put forth by Congress addressing the 
President's Budget request. We are very aware that this process has 
stretched members to their limits on many fronts. Please know that the 
resources we receive will be expended in focused alignment with the 
National Security Strategy (NSS) and National Defense Strategy (NDS) 
building our combat credible force.
    Our Nation supports maritime operations worldwide. Forward-deployed 
and forward-stationed naval forces use the global maritime commons as a 
medium of maneuver, ensuring the maritime levels of commerce remain 
free and open, assuring access to overseas regions, defending key 
interests in those areas, protecting U.S. citizens abroad, and 
preventing adversaries from leveraging the world's oceans against the 
United States. The ability to sustain operations in international 
waters far from U.S. shores constitutes a distinct advantage for the 
United States--a Western Hemisphere nation separated from many of its 
strategic interests by vast oceans. Maintaining this advantage in an 
interconnected global community that depends on the oceans remains an 
imperative for the Sea Services and the Nation.
    Our PB19 request enhances readiness and begins increasing the 
capability and capacity of the Navy and Marine Corps team. As directed 
within the 2018 National Defense Strategy (NDS), the PB19 budget 
submission will support the building of a more lethal, resilient, and 
agile force to deter and defeat aggression by peer competitors and 
other adversaries in all domains and across the conflict spectrum. 
Ultimately, our budget submission reflects the DON's efforts to protect 
the homeland and preserve America's strategic influence around the 
world. The Navy's overarching plan--the Navy the Nation Needs (NNN)--
consists of six dimensions: Readiness, Capability, Capacity, Manning, 
Networks, and Agility. The Marine Corps' plan--Modernizing for the 
Future Force--focuses on investments in Modernization, Readiness, and 
Manpower; further increasing its competitive advantage and lethality 
resulting in a Next Generation Marine Corps. The resourcing of both 
services aligns with the NDS, ready to fight and win across the range 
of military operations (ROMO).
    The strategic environment is rapidly changing and the Navy and 
Marine Corps is engaged in a competition that they have not faced in 
over 20 years. To meet the objectives of the NDS, and as part of the 
Joint Force, the Navy and Marine Corps' primary force contributors are 
Carrier Strike Groups (CSG) and Amphibious Ready Groups/Marine 
Expeditionary Units (ARG/MEU), and ballistic missile submarines--the 
most survivable leg of the nuclear triad. These units remain forward at 
all times, while additional CSGs and ARG/MEUs are ready to surge in 
support of Operational Plans. Our PB19 budget continues to make strides 
in achieving that requirement to once again re-establish the standard 
that has ensured preeminence. This will be imperative to winning peer-
on-peer competition, as we move forward to deliver enhanced distributed 
lethality.
    The Department is committed to follow reform guidance and has 
identified savings of over $1 billion in fiscal year 2019 and $5 
billion over the Future Years Defense Program (FYDP) which will be 
reinvested in force structure and readiness. Savings were achieved 
through reform efforts focused on improving organizational 
effectiveness; eliminating, restructuring, or merging activities; and 
workforce management. One specific fiscal reform effort has been the 
Department's focus on improving the expenditure of funds through an 
emphasis on the quality of our obligations. Leadership is committed to 
ensure that a dollar appropriated to the Department is expended by the 
Department to achieve the direction laid out by the NDS. Additionally, 
the Department has also reviewed duplicative programs or programs that 
are no longer mission essential. This has resulted in the divestiture 
of legacy F/A-18 Hornets, the transition of the HH-60H reserve squadron 
from legacy aircraft to newer MH-60S aircraft, and a review of Marine 
Corps training munitions. Representative investments resulting from the 
reform initiative include an additional DDG-51, one additional F/A-18 
E/F, increased procurement of Rolling Air Frame missiles and MK48 
torpedoes, and funding afloat readiness to maximum executable levels. 
Moreover, the Department is focused on improving business processes 
heightened through the audit of our financial statements.
    As we continue to look forward to the PB19 budget, our priorities 
center on people, capabilities, and processes, and will be achieved by 
our focus on speed, value, results, and partnerships. Readiness, 
lethality, and modernization are the requirements driving these 
priorities.
                                 people
    The ability to accomplish our mission successfully relies on the 
Navy and Marine Corps team--800,000 Sailors and Marines, active duty 
and reserve, our civilian teammates and families. We rely on their 
superior talent, recruiting the most promising workforce for the 
future, and making strategic investments in training and retention 
initiatives.
    Our forward-deployed forces suffered tragic mishaps in 2017, both 
on the sea and in the air. We will never forget those we lost and we 
stand by our fellow Sailors and Marines along with their families in 
solidarity.
    We do not take these losses lightly; both the Comprehensive and 
Strategic Readiness Reviews have examined the factors that led to the 
series of incidents on the sea and provided recommendations we are now 
implementing. The Strategic Readiness Review found that institutional 
deficiencies were the cumulative result of well-intended decisions 
developed over decades. Accepting deviations from our standards 
translated into the acceptance of higher risk, which then gradually 
became normalized, thereby compounding the accumulating risks. The 
entire Department of Navy leadership is committed to addressing these 
issues across the Force. The action plan, well underway, commands my 
full support and oversight and while we operate with a sense of 
urgency, we are steadfast in ensuring this is addressed correctly the 
first time.
    Good order and discipline are key ingredients to unit cohesion and 
lethality. Sexual assault is a cancer effecting the aforementioned. The 
Department of the Navy has come a long way in addressing sexual 
assault, but until we get to zero, there is still work to be done. As 
with any cultural change in an organization, our challenge involves 
sustaining positive momentum. We continue to resource and monitor our 
progress and address preventing sexual assault along with prosecution. 
My commitment is enduring and fundamental, and my position of 
intolerance for sexual assault anywhere is unequivocal.
    While the Navy and Marine Corps are achieving overall military 
recruiting objectives, the Department faces ongoing challenges from an 
increasingly competitive marketplace and a decline in the propensity 
for military service among young people as our accession goals are 
modestly increasing. The Department continues to explore systematic 
improvements to support recruitment and retention, to include programs 
which maintain the health and resilience of the force, and maximize 
professional, personal, and family readiness. Our success in sustaining 
maritime dominance relies on our ability to attract America's best. We 
will continue to recruit superior talent and invest in long-term 
measures to retain it, while fostering an environment where our 
Sailors, Marines, and civilians are provided the opportunities and 
resources they need to thrive and be successful. Aligned with our Core 
Values of Honor, Courage, and Commitment, we continue to strengthen our 
investment in the ethical development of our Sailors, Marines, and 
civilian employees. While competition for talent with the private 
sector continues to increase, I believe we are resourced and positioned 
to overcome our manning and retention challenges.
                              capabilities
    As we build our lethal capabilities to fight tonight and challenge 
rivals, we must respond on all fronts, to include research and 
development, rapid prototyping, accelerated learning, and partnership 
with industry. These efforts and partnerships will be built on shared 
risks and shared benefits. We are now working with industry in a true 
partnership to achieve a sustainable acquisition process that will 
provide us solutions to problems we face in order to remain ahead of 
the competition.
    The Department of the Navy has an overarching plan to meet 
warfighting requirements in support of the NDS. For example, the long 
range ship acquisition plan:
  --Establishes acquisition profiles to grow the force at a steady, 
        sustainable rate. This includes sustainment of the industrial 
        base at a level that supports more affordable acquisition while 
        growing an experienced workforce to support more aggressive 
        growth if additional resources become available.
  --Implements Service Life Extensions (SLE) based upon return on 
        investment--we will modernize rather than replace when 
        appropriate as good stewards of taxpayer dollars.
  --Provides options for aggressive growth as resources and industrial 
        capacity permit. PB19 includes four additional DDG 51 Flight 
        IIIs over the FYDP, for a total of 14 Flight III ships and 
        three additional fleet oilers across the FYDP. New ship 
        construction totals have increased since last year's plan, with 
        three additional ships (1 DDG 51 Flight III, 1 Expeditionary 
        Sea Base, and 1 fleet oiler) added in this request for fiscal 
        year 2019. Throughout the FYDP, the Department added a net 
        total of 11 battle force ships.
    With sustained funding and SLEs, PB19 puts the Navy on a path to 
355 ships while we are simultaneously increasing our capabilities. By 
setting the conditions for an enduring industrial base as one of our 
priorities, the Navy is postured to take advantage of additional 
funding that may be provided through reform initiatives in future 
years. This can be achieved without threatening the long-term 
competitive posture of a balanced warfighting investment plan while 
retaining an option to accelerate a targeted portfolio of weapons 
systems.
    The Navy is aggressively pursuing cost reduction opportunities to 
deliver fully capable assets at the most efficient possible cost. The 
Ford Class Aircraft Carrier program refined the ship construction 
process for CVN 79 by, capitalizing on technological improvements, and 
enhancing shipbuilder facilities to drive towards the targeted 18 
percent reduction in labor hours from CVN 78. The Navy is also 
executing advance procurement and negotiating long-lead time material 
for CVN 80, and full funding for CVN 81 begins in fiscal year 2023.
    Naval Aviation continues to operate forward, fully prepared for 
conflict across the ROMO while managing near-term service life 
extensions, mid-term procurement and modernization, and long-term 
investment in research and development. With the support of Congress, 
the U.S. Navy and Marine Corps are implementing our ``Vision for Naval 
Aviation 2020.'' The Department has initiated a Next Generation Air 
Dominance Analysis of Alternatives (AoA) study that is investigating 
technology and program investment requirements to recapitalize Navy F/
A-18E/F and EA-18G tactical aviation platforms. The future of DON 
tactical aircraft relies on a combination of F-35B and F-35C 5th 
generation aircraft. Continued investment in capability upgrades for 
both platforms is required to improve the lethality of the CSG and ARG/
MEU. We will see our first operational deployment of F-35Bs later this 
year with our ARG/MEUs in the Pacific.
    The MV-22B Osprey's unique combination of vertical flight and 
fixed-wing capabilities continues to enable effective execution of 
missions that were previously unachievable. Marine Corps MV-22B's 
continue to extend operational reach, revolutionizing our ability to 
operate from the sea, austere locations, and previously damaged 
airfields within a contested environment. The DON begins procurement of 
the Navy CMV-22B variant in support of the Carrier On-Board Delivery 
mission in fiscal year 2018.
    Navy and Marine Corps Expeditionary Forces will soon receive the 
next generation protected mobility. The Joint Light Tactical Vehicle 
begins fielding in 2019. In fiscal year 2019, the Marine Corps is set 
to receive the first Amphibious Combat Vehicle Low Rate Initial 
Production units in preparation for Operational Test and Initial 
Operational Capability in 2020. These capabilities are vital for our 
continued efforts to adapt and modernize our expeditionary forces with 
the requisite protected mobility. As we work through the programmatic 
schedule with these vehicles, we are continually looking at ways to 
improve their ability to counter ever changing threats from potential 
engagement with peer adversaries.
    The Department of the Navy is determined to lead the way in the 
development and responsible integration of cyber metrics and artificial 
intelligence, establishing aggressive goals for the acceleration of 
integrating these unmanned systems. One of these future systems is the 
Snakehead Large Displacement Unmanned Underwater Vehicle which is 
designated as a Maritime Accelerated Capability Office program to fast- 
track this capability. Surface operations will be augmented through an 
integrated team of manned and unmanned enhancing capabilities and 
capacity. Investments in autonomous platforms and mine countermeasure 
technology will reduce the threat of mines in contested waters while 
reducing risk to our Sailors conducting this dangerous mission.
    Steady progress will continue in developing and fielding unmanned 
aviation assets. Today the MQ-4C Triton Unmanned Aircraft System 
enhances awareness of the operational environment and shortens the 
sensor-to-shooter kill chain. The Navy is committed to future unmanned 
carrier aviation with the MQ-25 Carrier Based Unmanned Aerial System 
that will deliver an unmanned tanker. The Marine Corps continues 
development of the unique Marine Unmanned Expeditionary (MUX) system to 
further increase lethality and resilience of the fleet while also 
enhancing aggregate ISR capability.
    We are also investing in strike weapons as well as theater and high 
value target multi-layer area defense weapons for the Fleet. 
Investments are enhancing warfighting capability and increasing 
magazine depth. Along these lines, the Marine Corps is pursuing ground 
based fires to restrict freedom of movement along sea lanes while 
requesting the integration of Vertical Launch Systems to amphibious 
shipping.
    Efficiently operating Navy and Marine Corps installations are 
essential in generating naval forces. Over the last decade the DON has 
taken risk by underfunding infrastructure capital investments and 
installation operations to fund other warfighting, readiness, and 
modernization requirements. Under-investment has created a backlog of 
maintenance and repair requirements and reduced facility effectiveness. 
The DON's fiscal year 2019 budget request acknowledges and begins to 
address these installation investment challenges. The budget funds 
infrastructure that supports new platforms and an increase in 
infrastructure sustainment funding; begins to address the significant 
requirement to recapitalize our naval shipyards; and recapitalizes 
critical enabling infrastructure.
                               processes
    The Department is actively reforming business processes and driving 
efficiencies to increase speed, value, and support to the warfighter, 
while concurrently enhancing lethality and increasing readiness. We are 
identifying and clearing constraints caused by burdensome policies and 
regulations, and are increasing adoption of agile business models and 
technologies to support our need for urgency. Layers of overhead are 
being removed and organizations are being flattened to return 
decisionmaking authority further down the command structure. We are 
also demonstrating progress in the area of data-driven decisionmaking 
and problem solving. The Department of the Navy's fiscal year 2019 
budget request reflects extensive use of modeled campaign and mission 
level outcomes to evaluate capabilities and force structure and 
maximize naval power. We stood up a Digital Warfare Office to harness 
the power of data by executing digital pilot projects that informed 
decisions on operational effectiveness and readiness. Moving forward, 
the fiscal year 2020 Navy budget features additional force level 
analytic tools, developed at our federally Funded Research and 
Development Centers and in conjunction with industry that will further 
assist us in integrating valuation and capability assessments to 
optimize the Navy's budget for the highest warfighting return on 
investment.
    Growing the Fleet requires a strong and integrated relationship 
with our private sector partners. We are working closely with our prime 
contractors to ensure suppliers are prepared to support the increasing 
demand of building a larger Fleet. We need industry to provide 
solutions and capabilities at the speed of relevance and at an 
affordable value. As the same time we also need to be a better 
customer. Industry needs predictable and stable programs, which require 
a stable budget. If we are effective at long-range planning, we can 
increase our buying power by using all of our tools to provide stable 
commitments to our industrial partners. We appreciate the much needed 2 
year budget deal and look forward to working with you to produce stable 
and flexible funding that will drive improved productivity, efficiency, 
and competitiveness across the supplier base.
    We continue to pursue acquisition reforms contained in recent 
legislation, with emphasis on provisions that increase Service 
acquisition oversight and the role of the Service Chiefs in the 
process, along with those that provide opportunities to accelerate the 
fielding of critical capabilities. We are employing new constructs, to 
include the Maritime Accelerated Capabilities, the Marine Corps Rapid 
Capability Office, and an Accelerated Acquisition Board of Directors. 
These solutions will improve innovation, speed, and agility through 
strategy-driven investments addressing our highest priorities.
    The DON is undergoing its first full audit of all financial 
statements, which will help us gain a clearer picture of the 
effectiveness and an opportunity to improve our processes and internal 
controls. The Marine Corps was the first from our Department to 
complete the Full Financial Statement Audit for fiscal year 2017, 
sharing lessons learned across the Department. As our data quality 
improves, we will be able to harvest savings generated through process 
reform and reinvest in lethality. We are committed to full 
accountability for every dollar.
                               conclusion
    I deliver you today a plan with a sense of urgency. The fiscal year 
2019 President's Budget request seeks to provide sustained and 
predictable investments to modernize and increase the readiness of our 
Navy and Marine Corps team. We cannot and will not allow our 
competitive advantage to erode.
    These planned investments will provide combat-credible maritime 
forces for the future. I commit to you that we will not just look 
forward but will lean forward. I will focus the Departments support to 
the NSS and NDS. We will gain efficiencies and effectiveness through 
business reforms at my level while supporting both the Chief of Naval 
Operations and the Commandant of the Marine Corps' programmatic efforts 
to fulfil their needs to meet the challenges our Nation faces in the 
evolving strategic environment and maritime domain. We are grateful to 
Congress for their support and efforts. We will ensure we are good 
stewards of the provided resources, drive efficiency across the 
department to maximize every dollar, and invest smartly to leverage the 
return on our investments.
    I appreciate this opportunity to present our plan and will continue 
to work with the Congress to provide our Nation the Navy and Marine 
Corps team it requires.

STATEMENT OF ADMIRAL JOHN M. RICHARDSON, CHIEF OF NAVAL 
            OPERATIONS
    Admiral Richardson. Thank you, Mr. Chairman, Vice Chairman 
Durbin, and distinguished members of the committee for the 
opportunity to testify today to discuss your Navy. And I'm also 
honored to be here with Secretary Spencer and General Neller, 
two great leaders with whom I'm working to increase the 
warfighting lethality and readiness of your Navy-Marine Corps 
team.
    Mr. Chairman, you and the Secretary have described in vivid 
terms our Navy deployed around the world today, and a strong 
and responsive Navy matters to America now more than ever. As 
our National Defense Strategy makes clear, more naval power is 
essential in this new era of great power competition. With a 
rising China and a resurgent Russia, America no longer enjoys a 
monopoly on sea power or sea control. And meanwhile, regimes 
like Iran and North Korea threaten global stability.
    Given these challenges, we must increase naval power with a 
sense of urgency. Every day we must earn our place as the 
world's best Navy. To do that, we must take a balanced approach 
to build the Navy that the Nation Needs.
    The Navy the Nation Needs requires a bigger fleet, more 
ships, submarines, aircraft, and special operations forces. 
Congress agreed with the conclusions of several thoughtful 
studies, and a 355-ship Navy is now the law of the land. This 
will increase our Navy's ability to protect our homeland and 
our allies, to expand our influence as America's global 
maneuvering force, and to support American prosperity by 
safeguarding access to critical waterways. And while there will 
always be a debate about the eventual number of ships to build, 
we can all agree on one thing now, the Navy must get bigger and 
we must start building now.
    The Navy the Nation Needs requires a better fleet, more 
capability achieved through modernization, networking, and 
agile operating concepts. The Navy the Nation Needs requires a 
ready fleet, time at sea, more flying, better maintenance, and 
more weapons of increased lethality that go faster and farther. 
All of this demands a talented force of sailors and civilians 
with officers of confidence and character to lead them.
    Thanks to the efforts of this committee and the Congress, 
the readiness funds in 2017, and the enactment of the fiscal 
year 2018 budget has put us on a strong trajectory towards 
increasing American naval power in a balanced way. And as we 
discuss the 2019 budget request today that will help us achieve 
a bigger, better, and ready fleet, I commit that your Navy will 
be good stewards of every previous taxpayer dollar.
    This budget request enables your Navy to continue down a 
good course, and I look forward to the pleasure of navigating 
that course with Congress to building the Navy the Nation 
Needs, a Navy that's lethal to our enemies, committed to our 
partners, and safe for our sailors.
    Thank you. And I look forward to your questions.
    [The statement follows:]
            Prepared Statement of Admiral John M. Richardson
    Chairman Shelby, Vice Chairman Durbin, and distinguished members of 
the committee, thank you for the opportunity to testify today on the 
Navy's fiscal year 2019 budget.
    This hearing comes at a critical time in our Navy's and our 
Nation's history as we confront a dynamic security environment. The 
maritime domain--which I define as the sea floor to the stars--is 
indisputably more complex than it was when I took my oath in 1978. 
Within the past quarter century, global waterways have become more 
congested, with maritime traffic increasing by a factor of four. On the 
seabed, transoceanic cables carry 99 percent of all information, and 
new technologies are making undersea resources more accessible. The 
polar ice caps are receding, opening new trade routes, exposing new 
resources, and redrawing continental maps. People are migrating to 
megacities dotting the coastlines. Rapid technological advancements in 
cyberspace, artificial intelligence, robotics, and directed energy are 
changing the face of naval warfare. There can be no doubt that 
stability and economic prosperity both here in the United States and 
around the world are inherently linked to freedom of movement and 
security on, below, and above the world's oceans.
    But just as we have come to depend on this rules-based security 
order, there are those who would seek to turn the tide and upend it. 
For the first time since the fall of the Soviet Union, we are 
experiencing a return to great power competition. With a rising China 
and a resurgent Russia, the U.S. does not enjoy a monopoly on sea power 
or sea control. Rogue regimes like North Korea and Iran persist in 
taking actions that threaten regional and global stability. Given these 
challenges, a balanced strategic approach is more important than ever.
    Our priorities have been clearly defined by the President's 
National Security Strategy, which directs our Navy to protect the 
American homeland, promote American economic prosperity, and advance 
American influence throughout the world. The National Defense Strategy 
(NDS) operationalizes these imperatives and articulates our plan to 
compete, deter and win in the new competitive security environment of 
our time.
    The maritime expression of the NDS--what we are calling Navy the 
Nation Needs--articulates the Navy's role as part of the broader 
military joint force across three lines of effort. First, we must 
restore readiness while building a more lethal joint force--the prime 
objective of the Navy's fiscal year 2019 budget submission. Next, we 
must strengthen traditional alliances while building new partnerships 
to expand American influence and fortify global resolve. And finally, 
we must reform the Department to achieve greater performance through 
agile acquisition processes, early engagement with industry, capability 
iterations that ride the technological curve, and thoughtful 
stewardship of America's tax dollars.
    As the NDS makes clear, unstable funding over the past decade has 
contributed to ``erosion of military advantage,'' and recent action by 
Congress to restore stable and predictable funding demonstrates that 
you share this viewpoint. The recent passage of the Bipartisan Budget 
Act of 2018 (BBA-18) and the fiscal year 2018 defense appropriations 
are major steps in the right direction, underscoring our shared 
responsibility to provide, maintain, and operate a global Navy. The 
importance of stable and predictable funding cannot be overstated. It 
facilitates more planning time, productivity, and purchasing power; 
restores readiness through planned and precise resource allocation; 
sharpens perishable warfighting skills by steaming ships and flying 
planes; stabilizes the industrial base--especially shipbuilding--so 
that it is efficient, agile, postured to respond; enables us to mature 
technologies on a thoughtful path; and allows us to maximize every 
taxpayer dollar spent.
    In fiscal year 2017 we arrested readiness decline with the Request 
for Additional Appropriations, and the fiscal year 2018 enacted 
appropriations and fiscal year 2019 budget request further restore 
readiness while beginning to increase warfighting capacity and 
capability. The fiscal year 2019 budget submission is strategy-based, 
seeking a $2.4 billion increase for the Navy over fiscal year 2018 
enacted levels. The single most effective way to maintain the strategic 
momentum started in fiscal year 2017 and fiscal year 2018 is to enact 
the fiscal year 2019 President's Budget by the start of the fiscal 
year. This funding will help us fulfill our responsibilities in the NDS 
by building the Navy the Nation Needs. Everything we do must contribute 
to increasing America's naval power, which must be balanced in six 
specific dimensions to achieve needed wholeness.
    To increase America's naval power, we'll build a bigger fleet--more 
platforms like ships, submarines, aircraft, and more special operations 
forces. Congress made a 355-ship Navy the law of the land, and this 
increased capacity will strengthen our ability to prevail in any 
warfighting contingencies, meet demand signals from Combatant 
Commanders, expand global influence, and support American prosperity by 
safeguarding access to critical markets, waterways, and chokepoints. In 
fiscal year 2019, this budget requests over $55 billion in procurement 
accounts, funds a 299-ship deployable battle force, procures 10 new 
ships and submarines, and buys 120 fixed and rotary wing, manned and 
unmanned aircraft for the Navy and Marine Corps. Expanded across the 
Future Years Defense Program (FYDP), PB-19 funds construction of 54 
battle force ships--11 more than the PB-18 baseline--and extends the 
service life of six guided missile cruisers, four mine countermeasure 
ships, and one attack submarine to further increase the size of the 
fleet. And just as they have every day since the early 1960s, our 
ballistic missile submarines continue to patrol the deep as the only 
survivable leg of our nuclear triad. PB-19 includes $3 billion in ship 
construction (SCN) funds to ensure lead COLUMBIA-class ship 
construction commences on time in fiscal year 2021, guaranteeing 
defense of the homeland into the 2080s. Additionally, our Annual Long 
Range Plan for Construction of Naval Vessels, which accompanies the 
budget request, outlines a path to reach the Navy the Nation Needs. 
While there will always be debate about the final number of ships for 
our Navy, we can all agree on one thing. The Navy must get bigger, and 
we must start building NOW.
    To increase America's naval power, we'll build a better fleet--more 
capability across all our naval platforms. This means fielding state-
of-the-art systems and continually modernizing legacy ones. Keeping 
pace with advances in technology demands consistent, unwavering, and 
aligned financial, programmatic, and operational commitments. To that 
end, the fiscal year 2019 budget includes almost $18 billion for 
research and development in addition to other modernization efforts. 
For example, PB-19 includes $276 million for guided missile cruiser 
modernization and $79 million to upgrade eight cruisers to AEGIS 
Baseline 9, enabling them to perform critical Integrated Air and 
Missile Defense (IAMD) and Ballistic Missile Defense (BMD) operations 
simultaneously. By the end of fiscal year 2019, the Navy will have 41 
ships modified for BMD missions to defend our ships and the homeland. 
PB-19 also invests over $2 billion per year over the FYDP in land- and 
carrier-based aviation modernization and training to include improved 
radars, common avionics, structural enhancements, sensor upgrades, and 
refreshed mission computers. The budget maintains fiscal year 2018 
enacted funding levels for acoustic superiority modernization to 
improve large vertical arrays, advanced hull coating, and ship 
machinery quieting technology. The budget also requests $420 million 
for Surface Electronic Warfare Improvement Program (SEWIP), which will 
enhance shipboard electronic support capabilities and continue delivery 
of Block 2 systems currently in full rate production. We are also 
leveraging accelerated acquisition and rapid prototyping--for directed 
energy, lasers, STANDARD Missile (SM)-2/6 weapons, MQ-25 Stingray, and 
Unmanned Underwater Vehicle capabilities, just to name a few--to 
deliver capability faster.
    To increase America's naval power, we'll build a networked fleet--
allowing our fleet and the broader joint force to connect and combine 
in rapidly adaptable ways. History is replete with examples where 
networked forces that shared information executed more efficiently and 
effectively. The fiscal year 2019 budget builds on the progress made in 
fiscal year 2018 by requesting an additional almost $500 million 
investment in command, control, communications, computers; 
intelligence, surveillance, and reconnaissance; and cyber resiliency. 
By establishing and requesting $27 million to fund the Digital Warfare 
Office under the Deputy Chief of Naval Operations for Information 
Dominance (N2/N6), we continue to centralize our efforts to identify 
material and non-material solutions to mitigate warfighting gaps. 
Finally, critical upgrades to our E-2D Hawkeyes, F/A-18 E/F Super 
Hornets, and EA-18G Growlers will improve Naval Integrated Fire 
Control-Counter Air (NIFC-CA) architecture and introduce sensor netting 
and Cooperative Engagement Mode, allowing air- and seaborne units to 
optimize sensing, tracking, shooting, and controlling functions.
    To increase America's naval power, we'll build an agile fleet--more 
innovative concepts of operating to increase our competitive advantage. 
This past year alone, we leveraged the global maneuver power that is 
inherent in our Navy through concepts like Distributed Maritime 
Operations, in which fleet commanders are able to distribute but still 
maneuver forces across an entire theater of operations as an integrated 
weapon system, leveraging multi-domain capabilities and harnessing the 
power of the fleet tactical grid; Third Fleet Forward, during which our 
San Diego-based numbered fleet commander retained command and control 
for forces operating west of the International Date Line; and 
electromagnetic spectrum management, which safeguards our units and 
preserves our capabilities. Over the past year, we also established the 
Navy Analytic Office to better integrate the results of wargames, fleet 
exercises, and experimentation and continually learn and improve our 
technical and tactical operations at sea. And we are focusing four 
global wargames--facilitated through the Naval War College but 
sponsored by the Commanders of the Pacific Fleet and Naval Forces 
Europe--on peer competitors and high-end warfare. Finally, we are 
sharpening our focus on countering unmanned threats through programs 
such as the Surface Navy Laser Weapons System, as well as targeted 
experimentation, wargames, and innovation competitions to more rapidly 
integrate capability against these continuously emerging threats. In 
fiscal year 2019, we are investing over $300 million in research and 
development to develop and field laser weapon systems which include 
advanced capabilities to destroy unmanned threats. Additionally, our 
fiscal year 2019 budget requests $60 million to improve existing 
systems and other equipment to be able to identify and destroy unmanned 
aerial systems.
    To increase America's naval power we'll build a talented fleet--
more recruiting, training, education and retention. America's sons and 
daughters have always been our greatest source of strength. But make no 
mistake, we're in a competition for talent. So the fiscal year 2019 
budget requests an additional $1.6 billion for military personnel, 
which will increase the size of the active force by 7,500 billets, thus 
providing more accessions and support personnel to meet projected 
shipbuilding and special operations forces growth. Additionally, our 
Sailor 2025 initiative seeks to maximize all authorities and non-
monetary incentives to attract and retain skilled teammates in all 
warfare disciplines. We are transforming Manpower, Personnel, Training, 
and Education by investing in user-friendly systems and by updating our 
personnel detailing and assignment processes. Finally, while we remain 
on track for mandatory headquarters reductions, the fiscal year 2019 
budget adds about 1,400 critical civilian billets above current fiscal 
year 2018 estimates for ship depot maintenance, base security, 
intelligence, contracting, and training.
    To increase America's naval power, we'll build a ready fleet--more 
at-sea time, more flying, more ammunition and parts, more maintenance. 
Readiness--both materiel and practice time --transforms our Navy from 
potential power to actual power. The fiscal year 2019 budget continues 
the readiness and wholeness commitments we made in fiscal year 2017 and 
fiscal year 2018 by funding ship operations to 100 percent of the 
requirement and ship depot maintenance to 100 percent of executable 
capacity. It also funds flying hours to the maximum executable 
requirement and increases aviation depot maintenance funding to 92 
percent (the maximum executable capacity) as we grow capacity on our 
flight lines. In addition, $1.9 billion requested in fiscal year 2019 
for military construction will fund 33 Navy projects--the largest such 
request in over a decade. Recognizing the inherent link between 
readiness and lethality, the budget also increases procurement of high-
end ship-, sub-, and air-launched munitions over the FYDP, including 
Long-Range Anti-Ship Missile (LRASM), SM-2/6, Rolling Airframe Missile 
(RAM) Block II, Evolved Sea Sparrow Missile (ESSM) Block II, Advanced 
Lightweight torpedo, and Advanced Anti-Radiation Guided Missile 
(AARGM). And because the element of time is unforgiving, still other 
investments over the FYDP accelerate the delivery of critical 
capabilities and capacities into our magazines and launchers, such as 
multi-mission Maritime Strike Tomahawk ($239 million), Mark-48 
Heavyweight torpedoes ($184 million), and Littoral Combat Ship Over-
the-Horizon (LCS OTH) missile system ($177 million). Finally, we 
continue to work to stabilize and incentivize the industrial base. The 
fiscal year 2019 budget also includes 12.7 percent capital investment 
in public shipyard depot facilities, exceeding the 6 percent 
legislative requirement, underscoring our commitment to increase our 
capacity to maintain and modernize our fleet.
    As part of building readiness, we are also making immediate 
readiness improvements by funding the recommendations in our recent 
Comprehensive Review (CR) and Strategic Readiness Review (SRR). Across 
all appropriations categories, the budget requests $79 million in 
fiscal year 2019 and continues to invest an average of $130 million 
each year across the FYDP to address the individual and unit training, 
navigation equipment, command and control, and manning issues 
identified in the reports. We are also committed to improving the 
quality and duration of our training--both at sea and in realistic, 
shore-based simulators. The fiscal year 2019 requests $81.9 million 
over the FYDP to upgrade and integrate navigation, seamanship, and 
shiphandling trainers in Fleet Concentration Areas. We are already 
seeing progress: as just one example, a U.S.-based guided missile 
destroyer today has at least 30 more crew members onboard during the 
training phase before they are scheduled to deploy than a similar ship 
had in 2012 while on deployment. Additionally, we restored funded 
billets for our US- and overseas-based destroyer squadrons across the 
FYDP from 64 percent to 100 percent of the validated requirement, an 
increase of 306 total billets. This will add more experience in 
critical waterfront positions, improve the quality of our assessments, 
and ensure our units sail over the horizon ready to meet any challenge 
they may encounter. We are exploring ways to adjust assignment policies 
and expand incentives because our commitment to prioritize manning for 
our deploying units--particularly those ships, submarines, squadrons, 
and platoons based in Guam, Japan, and Spain--remains steadfast.
    A fundamental tenet of our budget request is that naval power is 
about maintaining balance across all six dimensions of naval power. 
Naval power is not a choice between increased capacity or better 
capability--it is a combination of both. Naval power is not a choice 
between readiness and modernization--it requires a balance of both. 
Naval power is not a choice between more complex stand-alone 
technologies or networked systems--it is achieved through both. The 
talent to operate and sustain a larger and more lethal force is not a 
choice between more people or better training--it must draw on 
components from both. Optimizing this balance ensures the fleet can 
maneuver as desired, respond when directed, and win in a short or 
prolonged fight.
    Of course, no number of ships, no new technologies, and no crews of 
talented Sailors are, by themselves, sufficient to respond to today's 
complex challenges without commanders of competence and character to 
lead them--they are the glue that binds our Navy team together. Just as 
we have done throughout our history, we will continue to develop and 
empower leaders who are obsessed with building teams that win.
    From the Black Sea to the Bab el Mandeb, from the North Atlantic to 
the South China Sea, and from the Indian Ocean to the waters off the 
Korean Peninsula, the stakes are high. And as we have learned from 
history, war at sea--whether lasting a day or a decade--is unforgiving: 
the winners sail away and the losers sink to the bottom of the ocean.
    Let there be no doubt: America is a maritime nation and a maritime 
power, and our way of life and our economic prosperity have always been 
linked to the sea. For 242 years, in rough seas and calm, America's 
Navy has operated around the world protecting our homeland from attack, 
ensuring common domains remain open, and advancing our interests to 
include defending our allies from military aggression.
    In the competitive environment we face now and in the future, we 
must increase naval power in a balanced approach to meet our national 
strategic objectives. I am grateful to this committee and to your 
colleagues in the Congress for starting this important work, and we 
look forward to sailing alongside you to build the Navy the Nation 
Needs--a lethal Navy for our enemies, a steadfast Navy for our allies 
and partners, and a safe Navy for our Sailors.

STATEMENT OF GENERAL ROBERT B. NELLER, COMMANDANT, 
            U.S. MARINE CORPS
    General Neller. Chairman Shelby, Vice Chairman Durbin, 
distinguished members of the committee, thank you for the 
opportunity to appear before you today. I know this committee, 
the Congress, and the American people have high expectations of 
their Marines. As our Nation's expeditionary force in 
readiness, you expect your Marines to operate forward with our 
Navy shipmates, reassure our partners, deter our rivals, and 
respond to crisis. And when called to fight, you expect us to 
win. You expect a lot of your Marines, and you should.
    As we hold this hearing, approximately 34,000 Marines along 
with their shipmates are forward deployed, some in harm's way, 
all engaged doing just what you expect them to be doing. Your 
Marines are an integral part of the new Defense Strategy, and 
rest assured we're doing our best to increase our competitive 
advantage against our strategic competitors.
    That said, we continue to face challenges, some as a 
consequence of rival adaptations, unpredictive funding, or our 
adjustment to the new strategic environment. I support what our 
Secretary and the CNO (Chief of Naval Operations) have said. 
Since the fall of the Soviet Union, the sea services of the 
United States have enjoyed well-earned, uncontested global 
dominance. Those days are over. Your Marine Corps, however, 
remains capable, along with our Navy shipmates, but that 
competitive edge has eroded in almost every domain of warfare. 
We must modernize and address great power competition or risk 
falling further behind.
    As we look ahead to the 2019 budget, developing your next-
generation Marine Corps requires the modernization of our 
Corps, the continued recovery of current readiness, and further 
investment in resourcing the next generation of Marines. These 
priorities, coupled with adaptations to our global posture, 
will provide our Nation's leaders the right capabilities at the 
right places to create decisionmaking space necessary for the 
Nation to compete, and if necessary, fight at the lowest cost 
and resources possible.
    Despite the challenges facing us today in today's strategic 
environment, our Marine Corps remains the Nation's forward-
deployed, agile expeditionary force in readiness as part of 
that Navy-Marine Corps team. To preserve that role and sustain 
the readiness it entails, we continue to require sustained, 
adequate, and predictable funding to develop the right mix of 
advanced capabilities and ensure a ready and relevant force. 
With the Congress' support and sustained commitment, we can 
begin to restore our competitive naval advantage, enhance 
global deterrence, and ensure that we send our sons and 
daughters into the next fight with every advantage our Nation 
can provide.
    I look forward to your questions.
    [The statement follows:]
             Prepared Statement of General Robert B. Neller
                 marines--vital to our nation's defense
    As set forth by the 82nd Congress and reaffirmed by the 114th, the 
purpose of our Corps is to provide maritime expeditionary combined arms 
air-ground task forces that are ``most ready, when the Nation is least 
ready.'' We are a naval force whose mission requires us to be ready--a 
fight-tonight, forward deployed, Next Generation force--able to respond 
immediately to emergent crises around the globe either from the sea, 
forward bases, or home station. While our organization, training, and 
equipment must continually adapt to meet changes in the operational 
environment, this fundamental purpose is unchanging. Our adaptation 
requires consistent, predictable funding--a reality we haven't 
witnessed in 9 years. Your Corps continues to be responsible stewards 
of our Nation's resources, innovating to meet new challenges and 
leverage new opportunities to further increase the lethality of our 
Marines. As our annual requirement to meet before this body and report 
our status, this statement aims to do three things: Broadly describe 
how your Marine Corps is adapting to increase its competitive advantage 
against pacing threats; explain our budget priorities for the 
President's Budget fiscal year 2019 (PB19) submission; and describe how 
continued support from Congress will result in a more lethal force, 
postured to prevent conflict, yet ready to prevail in the next fight.
Our Contribution to National Defense
    Combatant Commander (CCDR) demand for Marines and tailored Marine 
Air-Ground Task Forces (MAGTFs) continues to drive an aggressive 
operational tempo. We consistently maintain about 35,000, or one-third, 
of our operating forces forward deployed across the globe. Of those 
forward deployed forces, more than 11,000 served aboard Navy warships 
last year. Furthermore, our current posture encompasses several global 
tasks: Marines supporting multiple CCDRs with offensive air support and 
strikes from our Amphibious Ready Groups/Marine Expeditionary Units 
(ARG/MEU) afloat; building partner capacity in both Iraqi and Afghan 
Armies confronting Islamic State and Taliban fighters; providing 
critical fixed-wing and artillery fire support to coalition-enabled 
Syrian Democratic Forces as they fought to clear the Islamic State from 
Raqqa, Syria; providing tailored military combat-skills training and 
advisor support to foreign forces as part of Marine Corps Forces 
Special Operation Command (MARSOC); deterring aggressive behavior in 
the East and South China Seas through the forward posturing of 5th 
Generation aircraft within the Pacific; providing immediate disaster 
response from our ARG/MEU and Special Purpose Marine Air-Ground Task 
Force (SPMAGTF) to Americans in the wake of four hurricanes; supporting 
continued efforts to ensure freedom of navigation through the Bab al-
Mandab strait; and enabling full spectrum cyberspace operations while 
supporting Joint and Coalition Forces as part of Marine Forces Cyber 
Command (MARFORCYBER).
    Marines continue to foster and strengthen relationships with our 
allies and partners, executing 62 joint, bilateral, and multinational 
exercises last year. Exercises like Balikatan in the Philippines, Eager 
Lion in Jordan, and Joint Viking in Norway, increase our effectiveness 
and help us to gain an understanding of how to best complement one 
another's strengths. The Marine Corps also maintains a vital 
relationship with the State Department, providing security at our 
Embassies and Consulates worldwide. Today, Marines routinely serve at 
178 Embassies and Consulates in 148 countries around the globe. Marine 
Security Guard Security Augmentation Unit teams deployed 36 times last 
year at the request of the State Department, executing 17 Embassy/
Consulate and 18 VIP (POTUS/VPOTUS/SECSTATE) security missions. In 
short, as the Nation's ``911 force,'' we are forward postured across 
the Geographic Combatant Commands (GCCs), engaged daily in deterrence 
and security cooperation efforts, all while remaining capable of 
rapidly aggregating Marines from adjacent GCCs and the homeland to 
effectively respond to national crises.
             adapting to increase our competitive advantage
    The strategic environment continues to be complex, uncertain, 
technologically charged, and dangerous. The proliferation of modern 
conventional and cyber weapons to a broader range of state and non-
state entities, along with the erosion of our competitive advantage in 
areas where we have long enjoyed relative superiority, is likely to 
continue as rival states and organizations attempt to contest our 
influence. Competition for natural resources, violent extremism, 
natural disasters, social unrest, cyber-attacks, regional conflict, and 
the proliferation of advanced weaponry and weapons of mass destruction 
create a wide range of challenges for a globally responsive force. 
Further, complex terrain, technology proliferation, information as a 
weapon, the battle of signatures, and contested domains are driving 
change across the strategic environment. Through the lens of these 
drivers, your Marines look for ways to adapt and modernize to increase 
our competitive advantage against pacing threats.
    The ascendant threats posed by revisionist powers and rogue states 
require change--we must become more lethal, resilient and as a 
consequence, a more capable deterrent. The Navy-Marine Corps team can 
no longer rely on concepts and capabilities premised on uncontested sea 
control. We have begun to re-evaluate our capabilities to operate in 
all domains and conduct sea control, power projection, maritime 
security, and deterrence knowing that we must consider the tactical and 
operational details of a contingency--and how our contributions could 
shape the strategic environment to prevent conflict. Modern sensors and 
precision weapons with expanding ranges and lethality are redefining 
how we assess our posture and relative combat power. Advanced defensive 
networks are forcing us to re-consider the methods of power projection 
required to compete against rising peers.
    We have focused on preventing and deterring conflict by providing 
combined-arms task forces to theaters either already in crisis or at 
the risk of crisis to meet the Congress' mandate to be `` . . . ready 
to suppress or contain international disturbances short of large-scale 
war.'' We remain poised to quickly respond within the Contact Layer 
should deterrence fail to keep local disturbances from cascading into 
larger contingencies requiring the attention and resources of the 
larger Joint Force. As stated within the recently released National 
Defense Strategy (NDS), we must re-posture in a manner consistent with 
being the Nation's sentinels--preventing large-scale war and managing 
crises as an extension of the naval force. Steady-state requirements 
have degraded our readiness to support naval campaigns and degraded our 
combined-arms training necessary to create credible combat deterrent 
forces. Two challenges must be addressed to remedy these problems--(1) 
the resilience of our posture and (2) the pace of our naval force's 
availability and modernization. We require Congress' assistance with 
aspects of each.
    First, our global posture must adapt. To best adapt we must 
increase our strategic flexibility and freedom of action. The NDS 
introduces a Global Operating Model consisting of four layers--Contact, 
Blunt, Surge, and Homeland Defense--and apportions a combination of 
U.S.-based forces and theater-based ready forces to provide a method to 
mitigate the challenges outlined above. Your Marine Corps operates 
regularly within three of the four layers--Contact, Blunt, and Surge. 
ARG/MEUs, allocated forces, MARSOC, and MARFORCYBER are part of the 
Nation's Contact Layer--that competitive space where the military 
element of national power preserves the alignment of shared interests 
with our partners and allies. When competition escalates to conflict, 
these forces must be able to rapidly transition to combat operations. 
They are more often than not operating within the maritime domain, an 
area proving to be increasingly contested, compounding the challenges 
presented by the strategic environment. We must do so while 
simultaneously preparing to conduct challenging naval campaigns against 
adaptive competitors such as China and Russia. Despite being 
responsible and prudent with our Nation's resources, the cost of war 
and war readiness today is higher than ever. We have been innovative in 
meeting past challenges and leveraging emergent opportunities, yet we 
face ever growing threats from rising peers and irregular foes that 
require us to take a hard look at our global disposition.
    The development and acquisition of long-range precision weapons by 
our Nation's chief competitors and threats--China, Russia, North Korea, 
Iran, and Violent Extremist Organizations (VEO)--have placed many of 
our forward deployed forces within the effective range of their weapons 
systems, or ``threat rings.'' Forward deployed and stationed Marines 
are now vulnerable to attacks in ways we have not considered for 
decades. To operate within the Contact and Blunt Layers, Marine forces 
must be combat-credible and oriented on warfighting to provide credible 
deterrence. Marines who are stationed at and rotate through III Marine 
Expeditionary Force (MEF) in the Pacific are forward postured, 
providing expeditionary forward presence. The Blunt Layer requires a 
resilient, dispersed basing posture with sufficient forward stockpiles 
of logistics items and a reliable command and control (C2) network to 
delay, degrade, and deny aggression. Conversely, most of our forward 
bases and stations lack sufficient resilience against long-range 
kinetic and non-kinetic attacks; thus, jeopardizing our ability to 
prepare, project, and sustain combat power. Efficiencies in the 
construction and configuration of these bases made possible by relative 
security now pose as risks; however, there are remedies to these 
problems. We need additional hardening of our facilities to include 
aircraft hangars and command posts, the capability to rapidly repair 
damage to our air stations, and counter- precision guided munitions and 
advanced air-defense capabilities.
    From our current posture, rapidly aggregating Surge Forces will 
prove challenging. Responding to global contingencies against peer 
rivals in an expeditious manner may be contested every step of the 
way--we are going to have to fight to get to the fight. Surge Forces 
are those war- winning forces that deliver capable mass to the fight, 
primarily from the Continental United States, but also from across 
GCCs. They are highly ready and able to fight in all domains, degrading 
and penetrating anti-access area denial (A2AD) networks, as well as 
assuring access and projecting power with C2, fires, maneuver, and 
logistics. The rapid aggregation of Surge Forces is a problem that is 
not unique to the Marine Corps. Sea control has become more important 
now than in past decades, and the Marine Corps must further develop and 
integrate force capabilities in support of the Navy. This will require 
measured shifts from a focus on a near symmetric land-based enemy to an 
asymmetric view in which Marine forces ashore threaten enemy naval and 
air forces from expeditionary advance bases. There are elements of 
naval security cooperation concerning maritime security, all domain 
access, and power projection that could be assumed by the Marine Corps 
to alleviate pressure on our over-stressed fleets, particularly in the 
Pacific.
    Secondly, the operationally available inventory of amphibious 
warships and connectors is well below the requirement to satisfy a 
competitive global strategy. This is forcing CCDRs to rely on shore-
based MAGTFs that lack the advantages resident in shipborne formations. 
38 L-Class Amphibious warships are required to meet a 2.0 MEB Joint 
Forcible Entry requirement, and upwards of 50 would be needed to meet 
CCDR demand. Maritime Prepositioning Force (MPF) and Expeditionary-
class ships offer cost effective alternative platform options to help 
mitigate a lack of warship capacity and for low-end, low-risk missions 
in an uncontested maritime domain; however, they do not supplant our L-
Class warship requirement.
    Ships acting within a networked fleet must contribute to the 
lethality of the fleet with the ability to protect themselves from air, 
surface, and sub-surface attack, while also possessing organic ship-to- 
ship and ship-to-shore strike weapons. Current amphibious ships lack 
these capabilities and therefore must rely on support from other 
combatants to perform sea control and power projection missions. This 
could be remedied by upgrading command and control suites, introducing 
vertical launch systems and organic air defense, decreasing ship 
signatures to become less targetable, and installing the ability to 
launch and capture the MAGTF's growing arrangements of unmanned aerial 
systems (UAS). Incorporating these capabilities, with the help of 
Congress, would increase the lethality of our ARG/MEUs and the entire 
Joint Force while supporting operations throughout the Range of 
Military Operations (ROMO).
Increasing the Lethality of Our Corps
    Your Marines continue to innovate and build a Next Generation 
Marine Corps--a lethal, adaptive, and resilient Corps that implements 
combined arms as a means to conduct maneuver warfare across all 
domains, no matter the challenge--directly supporting the NDS, ready to 
fight and win across the ROMO. This transformation began in 2016 with 
the implementation of the Marine Corps Operating Concept (MOC). The MOC 
represents our institutional vision for how the Marine Corps will 
operate, fight, and win despite the challenges described above. As 
mentioned at the outset of this statement, while the Corps' fundamental 
purpose does not change, our concepts--and the organization, training, 
and equipment changes they drive--must adapt to effectively accomplish 
it. The MOC provides the foundation and context for subordinate 
operating and functional concepts--like Littoral Operations in a 
Contested Environment and Expeditionary Advanced Base Operations 
(EABO)--and it guides our analysis, wargaming, and experimentation. 
Further, the MOC drives the evolution of our Service doctrine, 
organization, training, materiel, leadership and education, personnel, 
and facilities (DOTMLPF) through a detailed and thorough Capabilities 
Based Requirements System.
    Whereas the MOC provides the concept for how Marines will fight and 
win, it is through extensive experimentation and wargaming that we 
validate our capability development choices and inform our investment 
strategies. Our experimentation and wargaming focuses on designing a 
balanced MAGTF, optimized for the future that incorporates Marines 
capable of leveraging cyber, information, and artificial intelligence 
capabilities. As a driver of innovation to identify these future 
capabilities, our Marine Corps Warfighting Lab (MCWL) completed the 
first phase of our long-range experimentation plan called Sea Dragon 
2025, which focused on augmenting an infantry battalion with 
experimental equipment, developing an analytically-based wargaming 
process, and leveraging commercial technological advances through our 
Advanced Naval Technical Experiment series. Phase two of Sea Dragon 
2025 is underway, initiating our Experiment Campaign Plan. This plan 
spans 3 years, focusing on MAGTF hybrid logistics, operations in the 
information environment, and EABO. Through these efforts, the Marine 
Corps will continue to adapt and refine our capability development, 
force structure, and investment strategy that modernizes the force.
                            our 2019 budget
    Our overall theme for PB19, Modernizing for the Future Force, 
focuses on three key budget priorities--modernization, readiness, and 
manpower--directly aligning with the Secretary of Defense's guidance to 
improve warfighting readiness, achieve program balance, and increase 
lethality. Driven by Marine Corps Force 2025 (MCF 2025), the capability 
investment strategy which modernizes the force toward implementing the 
MOC, we plan to rebuild a more lethal, maneuverable, and resilient 
force able to operate in the emerging strategic environment. To 
accomplish this goal, we require a budget that is delivered on-time, 
with consistency--adequate, sustained, and predictable funding is 
needed to properly plan for and resource a ready, capable force. That 
said, your Marine Corps remains committed to building the most ready 
force our Nation can afford, allocating $40.4 billion to our ground and 
aviation baseline budget, and an additional $3.1 billion in Overseas 
Contingency Operations funding as part of the PB19 submission--a 7 
percent increase over last year's submission. We plan to use the 
resources to increase our lethality to maintain our military advantage 
in a fiscally prudent and executable manner, addressing critical 
modernization requirements and investing in key warfighting 
capabilities without sacrificing near term readiness. Additionally, we 
plan to resource our infrastructure reset, Indo-Pacific strategy, new 
structure, materiel, munitions, maintenance and training requirements 
that together generate the right capability and capacity required. 
Allocating money across our budget priorities supports Department of 
Defense (DoD) guidance to restore military readiness and provide 
solutions that proactively shape the strategic environment.
    The Marine Corps is committed to audit readiness and business 
reform, viewing both as critical enablers to Warfighter readiness. The 
Marine Corps recently completed the Full Financial Statement Audit for 
Fiscal Year 2017, the first within the DoD. Although a disclaimer was 
issued for this first-year effort, the Marine Corps continues to push 
forward as the lead military service for a full audit of its financial 
statements. The Marine Corps has a commitment to achieve and sustain 
favorable audit opinions regarding the presentation of its annual 
financial statements. The transparency afforded with auditable 
financial statements demonstrates our commitment to the prudent 
management of taxpayer provided resources. Efficiencies gained through 
audit efforts enhance the overall support to the Warfighter and ensure 
the effective use of funds received. Progress will be measured not by 
the auditor's opinion in 2017, but by the velocity of corrective action 
as we continue to improve financial processes, systems, internal 
controls and accountability of equipment to achieve a clean financial 
opinion in the years to come. As the rest of the military services 
commence their full financial statement audits in fiscal year 2018, the 
Marine Corps continues to share our lessons learned across the 
Department.
    As part of ongoing business reform initiatives, the Marine Corps 
has identified more than $3.6 billion in savings and cost avoidance, 
$567 million in fiscal year 2019 alone, to provide for reinvestment in 
warfighting readiness. We continue to make strategic choices in the 
divestiture of certain programs to reallocate funds toward building a 
more lethal, modern, multi-domain, expeditionary force. This has 
included reducing depot level maintenance for the legacy Light Armored 
Vehicle (LAV) and Assault Amphibious Vehicle (AAV) as we look to 
accelerate the replacement of each vehicle. Similarly, the Marine 
Corps' Infrastructure Reset Strategy seeks to improve infrastructure 
lifecycle management and ensure infrastructure investments are aligned 
with Marine Corps installations that are capable, adaptive, and 
economically sustainable platforms from which to generate readiness and 
project combat power in a fiscally constrained environment. 
Implementation of this strategy consolidates and appropriately resets 
the infrastructure footprint within existing installations to improve 
operational readiness and generate resources for reinvestment.
    Marine Corps business reform initiatives have also included the 
more effective use of operating resources and force restructuring 
throughout our military and civilian manpower. An in-depth 
organizational structure and design review of Marine Corps Systems 
Command, for instance, led to a reorganization to enhance MAGTF 
alignment across product lines, maximizing economy of force by reducing 
overall program office structure, achieving better rank and 
responsibility alignment, and optimizing alignment with key 
stakeholders. In another example, a review of our ground conventional 
ammunition portfolio led to training requirements refinement; the use 
of new, less-expensive training munitions; and the elimination of 
duplicative munition requirements. We are focused on continuing 
business reforms in fiscal year 2019 that foster effective resource 
management and streamline the requirements and acquisition process.
    Modernization--The Foundation of Our Future Readiness
    Our Marine Corps must be modernized to meet the demands of the 
strategic environment. Given this urgency, we appreciate the 
Congressional action to improve acquisition through the National 
Defense Authorization Acts of fiscal year 2016 and fiscal year 2017, 
and we continue to leverage the opportunities provided by this 
legislation. While we are leveraging technology to advance promising 
capabilities in a range of information related areas, funding stability 
and flexibility must be increased to enable us to keep up with the 
rapid pace at which technology evolves. What we desire to achieve is a 
Corps capable of exploiting, penetrating, and destroying advanced 
adversary defenses in all domains in support of naval or Joint Force 
operations. That modernized force would deter adversaries, prevent 
conflict, and provide capabilities required to `` . . . suppress or 
contain international disturbances short of large-scale war;'' thus, 
preventing the consumption of readiness from the larger Joint Force. To 
do that, we must be afforded the flexibility to experiment with new 
technologies available on the market, determining what will work best 
in the future operating environment, and then delivering those 
capabilities to the force quickly to mitigate the rapid rate of 
technological change. Our newly chartered Marine Corps Rapid 
Capabilities Office (MCRCO) accomplishes that end, seeking emergent and 
disruptive technologies to increase our lethality and resiliency. The 
MCRCO leverages fiscal year 2016 and fiscal year 2017 NDAA provisions 
and partnerships to accelerate the acquisition process--with the 
consistent and steadfast support of Congress--we will continue to fund 
this office. Accelerated modernization is the most effective remedy to 
our long-term readiness problems and we must abstain from burying our 
modernization efforts under cumbersome acquisition processes--we have 
to get this right.
    PB19 provides $13.8 billion towards our investment accounts, nearly 
32 percent of our total request to modernize the force. This represents 
a 19 percent increase in investment funding over our fiscal year 2018 
budget submission. The PB19 investment approach is synched with the 
implementation of MCF 2025, specifically investing in areas such as: 
Information Warfare (IW), long range precision fires, air defense, C2 
in a degraded environment, and protected mobility/enhanced maneuver. 
These capability areas support building a Next Generation Marine Corps 
across the Active and Reserve components of the force. This approach 
includes changes to the structure of our Tables of Equipment into 
equipment sets that balance affordability with the need for a 
networked, mobile, and expeditionary force. Over the past decade and a 
half, fiscal instability, funding decreases, and operational demand 
increases have forced us to take risk in modernization to preserve 
readiness, deferring critical future aviation and ground programs. PB19 
continues the efforts started by the fiscal year 2017 Request for 
Additional Appropriations and PB18 to reverse this trend by investing 
in, and in some cases accelerating, our modernization programs that 
directly correlate to improved readiness by reducing unit costs, 
increasing efficiencies, and providing needed operational capabilities 
sooner.
    PB19 invests in our C2 capabilities needed to build a Next 
Generation Marine Corps that will dominate the information domain. This 
requires transforming MAGTF C2 through a unified network environment 
that is ready, responsive, and resilient, with initiatives that 
integrate Navy and Marine Corps systems. Enhanced C2 and digitally 
interoperable protected networks are modern capabilities that will 
facilitate improved battlefield awareness to and from small, dispersed 
tactical units--achieving this end is my top acquisition priority. Such 
programs as Tactical Communication Modernization (TCM), Common Aviation 
Command and Control Systems (CAC2S), and Networking On-the-Move (NOTM) 
provide significantly increased capabilities associated with maneuver 
and fires across the battlespace. As warfare evolves into a battle of 
signatures and detection, these information capabilities are vital to 
maximize the lethality, maneuverability, resilience, and effectiveness 
of our multi-domain, naval expeditionary forces.
    We continue to prioritize the integration of information 
capabilities throughout the MAGTF. Within the Command Element, 
investments in the Marine Intelligence Program allowed the formation of 
the MEF Information Group (MIG) to establish IW coordination centers 
for MAGTF Commanders, filling the IW gap at the operational level. 
Additionally, we have increased funding to MARFORCYBER to man, train, 
and equip cyber forces and conduct full-spectrum cyberspace operations. 
The coordination, integration, and employment of information and cyber 
capabilities will enable the MAGTF Commander to facilitate friendly 
forces maneuver and deny the enemy freedom of action in the information 
environment.
    The Ground Combat Element (GCE) is likewise being adapted to 
operate and fight more effectively in the strategic environment through 
the incorporation of information-related capabilities and the overall 
modernization of its ground formations. PB19 continues to invest in key 
ground systems like the ACV 1.1, Ground/Air Task Oriented Radar (G/
ATOR), High Mobility Artillery Rocket System (HIMARS), and Increment 1 
of the Joint Light Tactical Vehicle (JLTV). Furthermore, investments 
are being made to ensure more technological advances are being 
incorporated into our infantry units. We continue to increase the 
maneuverability, lethality, and resiliency of our infantry by 
decreasing loads, enhancing Company Level Operations and Intelligence 
Centers, increasing small UAS capacity and unmanned teaming with 
robots, adding engineering capacity to provide direct support to every 
infantry battalion, and increasing long range fires capacity. It is in 
areas like these that we need to garner flexibility within our 
acquisition process to assist in the streamlining of our modernization 
efforts. We must be able to outfit the individual Marine with the most 
modern technology and gear as soon as it becomes available. The 
investments being made across the GCE will result in a more lethal 
fighting force able to better support the Joint Force across the ROMO.
    PB19 invests in our aviation systems to modernize the Aviation 
Combat Element (ACE) by funding increases in the procurement of 5th 
Generation aircraft. The Marine Corps is challenged to replace aging 
aviation platforms that have reached the end of their service lives or 
suffered accelerated wear in ongoing combat operations. Our aviation 
modernization plan is a phased multi-year approach to modernization 
that encompasses aircraft transitions, aircraft inventory shortfalls, 
manpower challenges, safety and fiscal requirements. Our modern 
expeditionary force requires fixed-wing aircraft capable of flexible 
basing ashore or at sea in support of our Marine units. A top priority 
is the F-35B/C and its future sustainment. This aircraft is not just a 
replacement for three aging platforms; it provides transformational 
electronic and information warfighting capabilities for the future 
naval and Joint Force. Maximizing the potential of this aircraft 
requires further analysis of our joint training ranges to ensure our 
aircrews are able to train to its full capability. Other priorities for 
aviation include investing in lethal, persistent, multi-role 
intelligence, surveillance, and reconnaissance (ISR) Vertical Take-Off 
and Landing (VTOL) UAS like our MAGTF Unmanned Expeditionary (MUX) 
program; supporting capabilities such as electronic attack; 
implementing robust strike weapons programs; creating manned-unmanned 
teaming capabilities; and pursuing other sustainable modern aviation 
platforms ultimately increasing our competitive advantage against 
current rivals. Additionally, the CH-53K (Heavy Lift Replacement) 
remains a critical replacement to the CH-53E, as it has triple the lift 
capacity and is the only maritime, heavy-lift helicopter capable of 
supporting current and future warfighting concepts. Much like the MV-22 
Osprey, this helicopter will change the scope of our amphibious 
operations through its increased lift and load capacity.
    The Next Generation Logistics Combat Element will optimize tactical 
distribution with unmanned platforms, flatten the supply chain through 
additive manufacturing (AM), and enhance preventive and predictive 
supply/maintenance with sense and respond logistics. Further, state-of-
the- art logistics C2/Information Technology, enabled by artificial 
intelligence, will extend the operational reach of the MAGTF. Our MCWL 
and Next Generation Logistics (NexLog) organizations continue to stay 
at the cutting edge of military innovation. Marines are at the 
forefront of this effort, optimizing the potential of AM in garrison 
and overseas in austere environments. Our Marines are the world's 
military leaders in the realm of 3D printed tactical level unmanned 
aerial vehicles and using AM to produce time and mission critical 
components. We have more than 70 3D printers throughout the Marine 
Corps, and are fostering innovation through the establishment of 
``makerspaces'' (areas where 3D printers are made available for use by 
Marines) in the operating forces and supporting establishment. Once 
fully integrated, this capability will enable our Marines to create 
custom solutions to tactical problems, enhancing flexibility and speed, 
while fundamentally altering the supply chain and wartime logistics. We 
are experimenting with various unmanned aerial and surface platforms to 
increase our ISR and logistical capacity and capability on the modern 
battlefield. Lastly, we are conducting a series of innovation 
symposiums and challenges to harness the creative energy of all Marines 
in the development of Next Generation warfare capabilities for this 
century's five domain warfighting environment. This is the future and 
your Marines are working to change the way we conduct logistics in 
combat.
Readiness--The Core of Our Ethos
    The Marine Corps is unique among the Armed Services because your 
expectations require Marines to be a fight-tonight, forward deployed 
force, ready and capable of acting with minimal preparatory time--we 
should therefore be resourced accordingly. Our ability to rapidly 
deploy Marines to support missions across the spectrum of conflict is 
incompatible with tiered readiness. Marines do not get ready when a 
crisis occurs; we must be forward deployed and ready to respond 
immediately from within our rival's threat rings. PB19 provides $13.1 
billion towards our operation and maintenance accounts, over 30 percent 
of our total request, enabling us to meet all of our steady state and 
contingency requirements within established timelines, while balancing 
efforts across the force to meet operational demands.
    The Marine Corps is committed to building the most ready force ``to 
suppress and contain international disturbances short of large-scale 
war,'' and one capable of gaining and maintaining sea control as 
required by the larger naval force. Readiness, however, is the product 
of two metrics. The first is the ability of the force to execute its 
mission with ready people, ready equipment, and the right training. The 
second metric compares the force against potential adversaries in 
various circumstances. Within the context of global competition against 
rising peers, the scope of the second metric grows dramatically. For 
instance, if our units are ready (near-term readiness levels), then by 
the first metric we are ready. If, however, the force is outranged or 
outpaced by potential adversary capabilities (long- term capability 
modernization), then by the second metric we are not ready. We either 
assume risk to mission or modernize our capabilities to mitigate 
against the second metric.
    The Marine Corps is ready to execute missions assigned with 
deployed and next-to-deploy forces, but maintaining this readiness has 
come at the expense of the readiness of non-deployed forces, 
modernization, and infrastructure sustainment. This shortfall in 
readiness of our non-deployed forces limits our ability to respond to 
unexpected crises or major contingencies. In the event of a major 
contingency, degraded units could either be called upon to deploy 
immediately at increased risk to the force and the mission or require 
additional time to prepare, thus incurring increased risk to mission by 
surrendering the initiative to our adversaries. The fiscal year 2017 
RAA provided the investment needed to arrest this decline, and the PB18 
and PB19 budget submissions provide the resources needed to accelerate 
our readiness recovery.
    Another aspect of our readiness for major combat operations 
involves the capacity of our War Reserve Materiel to enable and sustain 
large-scale force mobilizations for major contingencies against rising 
peers. Historically, readiness of deployed and next-to-deploy forces 
also takes precedence over War Reserve Materiel, increasing risk and 
cost in the event of a major contingency. PB19 invests in our War 
Reserves in such areas as munitions and emerging starter stocks, 
maintenance modernization, and our MPF fleet; all vital parts of our 
Surge Forces. It also invests in our prepositioning programs in Norway, 
which includes the maintenance of our prepositioned equipment. The 
security threats to our Nation, as articulated by the Secretary of 
Defense and Chairman of the Joint Chiefs of Staff, demand that America 
has a globally responsive, truly expeditionary, consistently ready, 
forward-postured naval force. This is beyond dispute. To deliver on 
that requirement, there are four primary challenge areas within 
readiness that the fiscal year 2019 budget addresses: aviation; 
amphibious, maritime, and expeditionary ships; deployment-to-dwell; and 
infrastructure.
            Aviation
    Our most acute readiness issues are in aviation units. A 
combination of aging aircraft, a lack of ready basic aircraft, an 
unresponsive supply of parts and spares, and maintenance backlogs at 
the depots contribute to high over-utilization rates of available 
aircraft needed for training and certifications. This in turn hastens 
the induction of these aircraft into maintenance cycles. Lack of 
predictable and stable funding affects industry. Often when funding 
becomes available late in the year through Continuing Resolutions, the 
industrial base is not energized to meet demand. This negatively 
influences training and certification opportunities for our maintainers 
and aircrew.
    Our priority remains building aviation readiness for combat by 
balancing modernization with readiness recovery. PB19 works to assist 
with this by providing support to our comprehensive aviation recovery 
plan that, if sufficiently resourced and supported by our industrial 
base, recovers the force to an acceptable readiness level by fiscal 
year 2020 with a ready bench by fiscal year 2022. Further, PB19 plans 
to fund aviation readiness accounts at maximum levels and spares at 93 
percent of the requirement across both legacy and Next Generation 
platforms. We are also continuing to fund and support readiness 
initiatives to the F/A-18, CH-53E, and MV-22B. Budget challenges, 
production delays, and increasing sustainment costs for aging aircraft 
place the recovery plan in a fragile state--this readiness goal has 
already been delayed once. While aviation readiness recovery remains a 
priority--the introduction of the F-35B/C and accelerated modernization 
of our Next Generation ACE is just as important. Furthermore, the 
continued funding of legacy aircraft is a necessary bridge to the 
future as we continue to increase the size of our Next Generation fleet 
of aircraft.
            Amphibious, Maritime, and Expeditionary Ships
    The Joint Force must maintain access to and the ability to maneuver 
through the global commons, project power, and defeat a competitor 
attempting to deny freedom of action via the employment of A2AD 
capabilities. To meet these challenges, the naval force must be 
distributable, resilient, and tailorable, as well as employed in 
sufficient scale and for ample duration. Due to existing shortfalls 
within our amphibious, maritime, and expeditionary ship capacity, the 
naval force currently struggles to satisfy these basic requirements--an 
issue that will only grow worse over time if we cannot remedy our 
current budgetary issues. PB19 puts us on a path to address these 
issues, but we need Congress to act on this in a timely manner, 
consistent with a return to the regular order of business.
    The naval services must have optimally trained and equipped 
amphibious forces tailored to each theater and threat and ready to 
deploy with a suitable quantity of forces, on the designated timeline, 
and with the reservoir of non-deployed yet ready forces that can surge 
to meet the demands of large-scale operations or unplanned 
contingencies. The operational availability of the existing amphibious 
fleet is insufficient to meet global demands, negatively impacts the 
unit training necessary to recover full spectrum readiness, and does 
not support CCDR requirements for power projection. Consequently, the 
strategic risk to the larger Joint Force and mission is increased. The 
Navy possessed 62 amphibious ships in 1990, yet possesses only 32 
today. Of the 32 amphibious ships, 18 are available to support current 
or contingency operations. The stated requirement of 38 amphibious 
warships is the minimum number to fulfill our Title 10 obligation. 
Resourcing to a lower number puts CCDRs requirements and contingency 
response timelines at risk. The Navy and Marine Corps are currently 
operating below the minimum acceptable level and will continue to do so 
until fiscal year 2033 when we reach the minimum amphibious ship 
requirement of 38 per the fiscal year 2017 30-year shipbuilding plan. 
That said, we recommend exploring the acceleration of LHA-9--a project 
that can begin within the out years of the FYDP, bringing continuity to 
our industrial base and directly increasing the lethality of our Navy 
and Marine Corps team.
    While some ships in the amphibious inventory have undergone 
upgrades to support the F-35B and are fundamentally more capable 
platforms than those they replaced, the naval force lacks the capacity 
necessary to conduct requisite training to build total force amphibious 
readiness and simultaneously prevent conflict. The Marine Corps, in 
coordination with the Navy, is exploring innovative ways to employ 
alternative platforms for amphibious operations in more permissive 
environments in order to provide more global coverage in the most 
resource-appropriate manner. These alternatives are by no means 
replacements for amphibious warships, but instead provide cheaper, 
additive alternatives in certain environments. Tailored MAGTFs afloat 
on these vessels would replace those on shore due to limited shipping. 
Regardless of the ship, whether an LHD equipped with F-35Bs and MV-22s 
or an Expeditionary Sea Base with embarked crisis response forces, 
Marines require additional maritime expeditionary shipping to satisfy 
current requirements and the NDS. Congress could help remedy this by 
supporting the PB19 request.
    Ship-to-shore connectors move personnel, equipment and supplies, 
maneuvering from a sea base to the shoreline. These are critical 
enablers for any naval force. Modern aerial connectors, such as the MV-
22 Osprey and CH-53K, extend operational reach and lift capacity, 
revolutionizing our ability to operate from the sea, austere locations, 
and previously damaged airfields within a contested environment. Aerial 
connectors alone do not suffice; the Navy is in the process of 
modernizing the surface connector fleet by replacing the aging Landing 
Craft Air Cushion (LCAC) and the 50-year-old fleet of Landing Craft 
Utility (LCU). This system of surface and aerial connectors would 
enable the Joint Force to establish a web of sensor, strike, decoy, and 
sustainment locations based on land and sea that would complicate the 
strategic and operational decisionmaking of our most advanced rivals, 
thus attacking their A2AD strategies. Continued funding of the 
modernization, maintenance, and service life extension programs of our 
existing fleet of connectors is critical to enabling our success in 
future security environments.
    Mine Countermeasure (MCM) capabilities are consistently 
underfunded, affecting the Joint Force's ability to operate in the 
littorals. The assault element of an amphibious task force, as well as 
any amphibious force maneuvering to establish expeditionary advanced 
bases, requires assured maneuver through very shallow water, surf 
zones, and beach zones to inland objectives. The Naval force has a 
deficiency in MCM capability and capacity in these areas, which has a 
direct effect on options available to fleet commanders within contested 
seas. Naval MCM is in a transitional period where legacy systems are 
reaching the end of service life. Although PB19 extends the service 
life of four MCM systems, we must accelerate future capability to 
ensure continuous MCM coverage during the shift from legacy to future 
MCM systems. Future MCM systems could provide solutions to identified 
gaps in detection and neutralization in very shallow water, the surf 
and beach zones. Sufficient, sustained, and focused resourcing for this 
transition is needed to provide required capabilities and capacities--a 
critical capability to support amphibious operations. If the naval 
force possessed the capability to easily overcome layered mine defense 
in contested near-seas, such as the South and East China Seas, through 
a more robust MCM capability, then we would in effect be attacking the 
adversary's A2AD strategy. This would demonstrate our ability to 
penetrate their defenses at a time and place of our choosing, and force 
them to revalidate assumptions, change decisions, and invest in other 
more costly capabilities. Assured naval surface access and assured sea 
control cannot be achieved without an acceleration of our MCM 
capabilities.
            Deployment to Dwell
    The rate by which Marines deploy largely depends upon what unit 
they are assigned to and the operational demand for those units. 
Currently, that rate is favorable for Marines assigned to many of our 
headquarters elements; however, a majority of the Active Force is 
experiencing a deployment to dwell (D2D) ratio that is unsustainable. 
We confront this challenge daily. While these demands are clear and 
unmistakable evidence of the continued relevance of Marines, this tempo 
is not sustainable as it limits time to train to our full naval mission 
sets. We must return to a 1:3 D2D force to have the time required to 
train for the high-end fight and achieve balance with our Marines and 
their families at home. Continued high operational tempo is affecting 
our ability to retain Marines and we need to ensure we are doing what 
we can to sustain our career force.
    There are three types of Marines in our Corps: those who are 
deployed, those getting ready to deploy, and those who just returned. 
PB19 supports an 186,100 Active and 38,500 Reserve component end-
strength force while maintaining an approximate 1:2 D2D ratio in the 
aggregate. Funding at a 1:2 D2D ratio, although not sustainable, is a 
conscious, short-term decision we must make to balance modernization 
while meeting current demand and simultaneously recovering our 
readiness.We owe our Marines and their families the necessary time to 
reset and train for the next deployment or contingency. Historically, 
Marines have benefited from being a 1:3 D2D force. The Marines that 
were not deployed, had adequate time to prepare across the full 
spectrum of conflict and could be counted on to be ready when called 
upon to reinforce their teammates if a major contingency happened. This 
would require a substantive increase in supply or decrease in demand--
we are not asking for the former in this year's budget. Consequently, a 
temporary reduction of our operational tasking is required to improve 
our D2D ratio. Although accepted in the short-term for the reasons 
outlined above, we must not accept a 1:2 D2D as the new normal. We 
routinely talk about our readiness--fixing these dwell challenges will 
help to better our readiness.
            Infrastructure
    We must prioritize Infrastructure Reset--we must improve 
infrastructure lifecycle management and ensure infrastructure 
investments are aligned with Marine Corps capability-based requirements 
to support the warfighting mission and contribute directly to current 
and future Force readiness. PB19 funds the Infrastructure Reset 
Strategy with realized long-term cost savings through a reduction of 
1056 failing structures (14 million square feet) during the Future 
Years Defense Program (FYDP) and yield savings in Facilities 
Sustainment, Restoration and Modernization (FSRM) accounts. Our 
installations provide three critical force enabling functions. First, 
they are deployment platforms from which our expeditionary forces fight 
and win our Nation's battles; second, they are where our MAGTFs train 
and hone their combat readiness; and third, they house our Marines and 
families.
    The Marine Corps has historically taken risk in facilities funding 
to protect near-term readiness and service-level training. While 
proposed investments in FSRM will allow our facilities to maintain an 
average condition, if long term underfunding of FSRM requirements 
continue, the progressive degradation of our infrastructure will 
result, potentially creating a bow wave of long-term costs and in a 
manner inconsistent with the National Security Strategy (NSS), NDS, or 
National Military Strategy (NMS). PB19 begins the work to ensure our 
infrastructure is resilient against not only long-range precision 
strike, but also cyber-attacks. The greatest need of enhanced 
resilience exists on our strategically significant overseas bases in 
the Pacific on Okinawa and Guam. These locations are vital to 
reassuring partners and allies in the region.
Manpower--Growing and Sustaining Our High Quality People
    Our people--Marines, civilians, and their families--are the 
foundation of all that we do; they are our center of gravity. PB19 
provides $15.7 billion towards our manpower accounts, over 36 percent 
of our total request as it begins to implement MCF 2025. It also 
supports building a more experienced, better trained, and more capable 
force by increasing the number of Marines we have with special skills 
like MARSOC; those required for intelligence operations; and 
electronic, information, and cyber warfare. Our manning requires 
leaders with the grade, experience, and technical and tactical 
qualifications associated with their billets, which is essential to the 
Marine Corps as a ``fight tonight'' force. The resources we dedicate to 
recruiting, retaining, and developing our people directly contribute to 
the success of our institution. Our commitment to our Marines, their 
families--and the civilians who support them at bases, stations, and 
depots across the globe--must never waiver.
    Marine recruiters consistently meet our recruiting goals by finding 
motivated and qualified men and women within our Nation who are willing 
to raise their hands and volunteer to wear the Eagle, Globe, and 
Anchor. These men and women are smarter and more capable than past 
generations and we continue to effectively lead them, both at home and 
in combat. Devoted to upholding our values of honor, courage, and 
commitment, we are dedicated to holding ourselves to the highest 
standard of personal conduct. To this end, we have taken an 
introspective look at our culture in light of social media 
controversies and have created a task force and permanent office to 
examine and correct conditions that enable disrespect or misconduct to 
exist. We are committed to ensuring Marines treat each other with 
dignity and respect. As issues arise, our commanders take necessary 
action to ensure we maintain an organization that values the 
contributions of all Marines based on their individual merit and 
commitment to warfighting excellence.
    Increasing the effectiveness of our Marines requires constant 
reflection on how we conduct training; training to prepare for combat 
and training that sustains the transformation of Marines into resilient 
leaders who are mentally, morally, and physically fit. That 
transformation begins with entry- level training, whether it be recruit 
training or Officer Candidate School, and continues throughout a 
Marine's service--whether it be a single enlistment or 40 years. We 
believe in returning quality citizens to society when they leave the 
Marine Corps--entry-level training is where that begins.
    Over the last year, we have examined how we conduct recruit 
training and made adjustments, while strictly maintaining the standards 
necessary to ensure all Marines are proficient in the skills required 
of our Nation's premier warfighting force. We have integrated a 
majority of the recruit training phases at Marine Corps Recruit Depot 
Parris Island. Additionally, the Recruit Depots have redesigned the 
last 11 days of entry-level training--as a new, fourth phase--to 
enhance a recruit's new identity as a Marine. The training focuses on 
mentorship and leader-led instruction aiming to better prepare the new 
Marines for the transition to follow-on training and the operating 
forces. The newly created Transformation Enhancement Program (TEP) 
improves our existing curriculum at our Formal Schools--reinforcing the 
values and principles emphasized during the Fourth Phase of recruit 
training. The TEP has been implemented at our combat training 
battalions and Schools of Infantry with plans to continue 
implementation into all formal schools over the next year.
    Our Marines want to deploy, serve our Nation, and protect our 
country from threats overseas. As Marines, we pride ourselves on being 
ready and on training for combat in conditions that are as close to 
reality as possible to enable success when called to fight. To ensure 
their success in future conflicts, we continue to build upon our 
lethality as we adapt our training, driving changes in our programs. 
Conducting combined arms in multiple domains, counter-unmanned aerial 
systems, managing signatures, and increasing integration of simulation 
technologies are all part of the new training regimen. Innovation 
remains a critical aspect of our Corps as Marines continue learning 
through the testing and evaluation of new methodologies and 
technologies to gain advantage over our rivals. Cyber operations, 
information and electronic warfare, more capable command and control, 
intelligence, engineering, civil-military operations, manned-unmanned 
teaming, robotics, AM, and the leveraging of artificial intelligence 
are critical skills we need for the future fight. Accordingly, we are 
updating course materials and developing new programs of instruction to 
ensure the Marine Corps remains a step ahead of our rivals.
    Taking care of our Marines, civilians, and their families is a key 
element of overall readiness, combat effectiveness, and warfighting. 
Today's requirements mandate that we not only provide equipment, but 
also focus on other important aspects of readiness, such as family 
stability, housing, spousal support, behavioral health, education, 
professional development, transition assistance, financial literacy, 
and wounded warrior support. Deployment Readiness Coordinators help 
ensure our families get the support needed before, during, and after 
their Marines deploy. Additionally, our comprehensive packages of 
services (Sexual Assault Prevention and Response; Suicide Prevention 
and Response; Behavioral Health; Wounded Warrior Regiment; Personal and 
Professional Development; and Transition Assistance) support the 
complete fitness and readiness of our Marines and their families. The 
Marine Corps remains focused on solutions to reduce destructive 
behaviors, particularly sexual assault, suicide, hazing, and excessive 
alcohol consumption. The abuse of alcohol is a known factor and 
contributor across the spectrum of force preservation issues and 
negatively impacts the readiness of our force. We are keenly focused on 
dramatically reducing these destructive behaviors.
                               conclusion
    Today, the Marine Corps faces many challenges; some as a 
consequence of rival adaptations, and some as a result of unpredictable 
funding. Years of sustained operations ashore in Iraq and Afghanistan 
have increased the divide between the Marine Corps and the Navy. For 
years, the Marine Corps and Navy have taken presumptive sea control for 
granted, despite warnings. We have focused on power projection and 
assured access, assuming sea control would remain uncontested. Since 
the fall of the Soviet Union, the Sea Services have enjoyed well-
earned, uncontested global dominance. Those days are over. We need to 
modernize and address peer competition or risk falling further behind. 
Our budget priorities, coupled with the evolution of our global 
posture, will provide our Nation's leaders the right instruments of 
power and the right places to create the decisionmaking space necessary 
for competition and contingency at the lowest cost in resources 
possible.
    The Marine Corps will adapt its global posture. As a naval force, 
deployed Marines predominately reside aboard ship, fully integrated 
with the Navy and expanding the competitive space and advantage of the 
Joint Force. The ocean provides flexibility, freedom of maneuver, 
survivability, and agility. Despite being the subject of competitor 
tracking, hitting a moving target is much more difficult than one that 
has been in the same position year after year, and thus affords much 
greater unpredictability--imposing a cost on any competitor. In recent 
history, we have found our forces tied to fixed locations in special 
arrangements to support necessary requirements during times of 
increased instability throughout specific regions of the globe. We must 
put these forces back on ship, whether on upgraded amphibious warships 
postured to respond to conflict or on alternative platforms. This 
postures us to assure partners and allies, compete with rivals, and 
defeat VEOs. We recognize the continued issues with our amphibious, 
maritime, and expeditionary ship inventory; however, we must focus on 
increasing the capabilities of the ships we do have, while developing 
cheaper alternatives for more permissive environments.
    We will continue to foster and strengthen our partnerships and 
alliances as today's strategic environment requires strong global 
partners. When our adversaries choose to test our will or capabilities, 
we must be ready with our allies to act with the appropriate force to 
overcome those hostile acts with such speed and decisiveness as to 
prevent further acts of aggression. We will prioritize those joint, 
multinational and bilateral exercises that offer the greatest return on 
investment as measured in readiness gains with select partners. These 
exercises increase our lethality as we gain an understanding of where 
we can strengthen each other's weaknesses.
    Despite the challenges facing us in today's strategic environment, 
our Marine Corps remains the Nation's forward deployed, agile, 
Expeditionary Force in Readiness. As the service with unique readiness 
requirements, we require sustained, adequate, and predictable funding 
to develop the correct mix of advanced capabilities and ensure a ready 
force. As we look ahead to the 2019 budget, we have prioritized the 
modernization of our Corps, the recovery of our current readiness, and 
investments to resource the next generation of Marines. The continued 
investment in these priorities will ensure Marines are capable as a 
high-end, conventional combat deterrent, able to respond to immediate 
contingencies and conduct crisis response across the continuum of 
conflict. With the Congress' support and sustained commitment, we can 
begin to restore our competitive naval advantage, enhance global 
deterrence, and ensure that we send our sons and daughters into the 
next fight with every advantage our Nation can provide.

                 FISCAL RESPONSIBILITIES AND READINESS

    Senator Shelby. Secretary Spencer, the 2-year budget deal 
for the fiscal years 2018 and 2019 provides additional 
appropriations for the Department of Defense and of course, the 
Navy. With the steep increase in funding that we've alluded to 
already compared to previous years, can you explain to the 
committee here today how the Navy is maximizing your 
opportunity here to use every dollar to make sure that 
taxpayers' dollars don't go to waste but go to national 
security?
    Secretary Spencer. Thank you, Mr. Chairman. We do have a 
plan front and center that we started actually at the turn of 
the calendar year in hope that we might get the great gift that 
you have given us. As an example, for the budgeting offices, we 
have had the practice out in place to start monitoring 
obligations as they go forward. Those offices that find 
themselves challenged to actually deploy funds that they've 
been allocated are to put the hand up early and say, one, ``Can 
we use BTR relief that you have given us to reapply the funds 
to different areas within their purview and/or hand it up into 
the Department level so we can make sure that they can be 
reallocated by notifying you all?'' The whole goal here is to 
spend those funds--one, to allocate those funds where needed in 
a maximum effort and a responsible effort.
    Senator Shelby. Mr. Secretary, because we all know that the 
2-year budget deal ends after 2019, and the budget caps created 
by sequestration remain in effect for the years 2020 and 2021. 
What impact would return to sequestration have on the Navy?
    Secretary Spencer. Massively detrimental, Mr. Chairman. We 
would hope, and I know hope is not a strategy, we would pray 
that it does not happen, and that you all can rectify the 
situation. Sequestration, as you've heard me say before, and 
continuing resolutions have cost the Navy about $4 billion in 
wasted dollars.
    Senator Shelby. Also could cost you readiness, too, could 
it not?
    Secretary Spencer. Exactly.
    Senator Shelby. Thank you.

                        GREAT POWER COMPETITION

    Admiral Richardson, great power competition, which we have. 
In your submitted testimony, you say that the U.S. does not 
enjoy a monopoly on sea power or sea control, and that we're 
experiencing a return to great power competition with a rising 
China and a resurgent Russia. Could you describe what you can 
here in open hearing today what the Navy is doing to improve 
its defensive and offensive capabilities to address these 
challenges?
    Admiral Richardson. Sir, that is exactly the Navy the 
Nation Needs, and so we're----
    Senator Shelby. It's what you're about, isn't it?
    Admiral Richardson. Pardon me, sir?
    Senator Shelby. I said that's what you're about.
    Admiral Richardson. That--that is--you described my job, 
sir.
    Senator Shelby. Yes.
    Admiral Richardson. That's what I do. And so not only a 
bigger fleet, more ships, this budget request has a request 
for, you know, 10 ships, dozens of aircraft. This is lethal 
power. But not only the capacity of the Navy, the number of 
ships, but also, what is the capability of each of those ships? 
And so we've got an aggressive approach to take a look at 
modernization with leaning into the future with directed energy 
weapons and those sorts of capabilities that will really 
maintain our superior edge over those emerging navies.
    Finally, as competitive as anywhere else is the competition 
for talent. And none of this works without our talented sailors 
and civilians. And so we've got competition in that area as 
well.
    Senator Shelby. Do you believe that a lot of the great 
power competition that is China and perhaps Russia is occurring 
or will occur in the Pacific?
    Admiral Richardson. Sir, the Pacific is the central 
priority there.
    Senator Shelby. It is.
    Admiral Richardson. Absolutely.
    Senator Shelby. It's our biggest lake, isn't it?
    Admiral Richardson. Yes, sir.
    Senator Shelby. Thank you.
    Admiral Richardson, and I'll also direct this to General 
Neller, too, rogue regimes like North Korea and Iran are acting 
to threaten regional and global stability. Do the Navy and 
Marine Corps have the ability to respond if called upon in a 
real crisis there?
    Admiral Richardson. Mr. Chairman, we do.
    Senator Shelby. General?
    General Neller. Yes, sir, we do.
    Senator Shelby. Admiral Richardson, in December of 2016, 
you completed a force structure assessment to determine the 
correct balance and mix of platforms needed to address the 
Navy's responsibilities to the Nation. You concluded that you 
need 355 ships. Can you explain how this budget request 
supports the Navy's requirement to get to that goal?
    Admiral Richardson. Sir, this budget request is very 
supportive of our requirement to get to that goal. The 
combination of new acquisitions, service life extensions, you 
know, the combination of those will allow us to reach that 355 
goal as quickly as we can, right now projected in the 2030s. So 
we see a quickly building ramp in terms of growing the Navy.

                  COMPETITION AND THE MARITIME DOMAIN

    Senator Shelby. Could you speak to how important that a 
healthy and robust industrial base is to the shipyards and 
vendors and everything that goes with it? In other words, you 
just can't create a Navy overnight, can you?
    Admiral Richardson. You cannot. And our shipbuilding and 
really Navy industrial base is an absolute strategic jewel in 
the Nation's crown. It's something that must be preserved at 
every cost.
    Senator Shelby. About 90 percent of the world's trade is 
carried by sea. New trade routes are opening up, and there is 
competition, as we all know, for undersea resources. In other 
words, the maritime security environment is becoming ever more 
complex.
    I'll address this to you, General Neller, and also to the 
Admiral. What does this mean for how we train and equip our 
sailors and Marines because this is more competition, more 
risk? General?
    General Neller. Chairman, the United States is a maritime 
nation. We rely upon the sea lines of communication for 
commerce and to move trade. We are traders; that's what we do. 
And your Navy, your naval force, your Navy-Marine Corps team, 
has to make sure those sea lines of communication are open and 
unrestricted. So for us, for our training, it's not ops normal 
because the capabilities of our potential adversaries are much 
more capable. They're getting longer range, their submarines 
are getting better, their aircraft, and their missiles. So 
we've got to up our game, not just in the capabilities we have, 
but in the training that we do. We've been at war in our 
counterinsurgency stability operations, at least for your 
Marine Corps, for the last 17 years, and we're in the process 
of changing our training regimen to focus, as we did back in 
the '80s, against the Soviet Union, against a peer adversary.
    So we've got to change how we train our force. There are 
certain capabilities in the force that we need that we didn't 
need to the degree in the past, such as information operations, 
cyber, electronic warfare, and other capabilities, more long-
range precision strike. So all of that is in this budget, and 
we're looking forward to getting after it. But those are the 
things that we're doing to adjust to the new environment.
    Senator Shelby. To both of you, my last question here, we 
all hope that there are going to be some diplomatic 
breakthroughs dealing with Korea, North Korea, and so forth, 
but if there's not, does the Navy and the Marines stand in 
readiness to do whatever we have to do to protect our national 
security?
    Admiral Richardson. Mr. Chairman, I'll start. As you know, 
it's a diplomatic and economic campaign at this point with the 
military and support.
    Senator Shelby. Number one.
    Admiral Richardson. Right, yes, sir. And we are providing 
firm and credible military options to back that up.
    Senator Shelby. General.
    General Neller. Our job is to provide for the decision-
makers and the leaders of this country, decisions base--based 
on the capabilities that we have as a military. So we're 
continuing to look at all possible contingencies and what may 
be required to support those diplomatic options.
    Senator Shelby. Senator Durbin.

                        SURFACE FORCE READINESS

    Senator Durbin. Thanks, Mr. Chairman.
    And thanks again to the panel that's gathered today for 
your service to our country.
    The incidents involving the Antietam, Champlain, 
Fitzgerald, and McCain were wakeup calls. As a result of those 
incidents, we initiated a Comprehensive Review and a Strategic 
Readiness Review. The finding in those two--the findings in 
those two reviews are sobering. Among the observations that 
were made, the Fitzgerald, not operating at a safe speed, the 
crew did not use radar properly, they failed to use the GPS 
(Global Positioning System) system, poorly communicated 
situational awareness, and the crew was fatigued. The command 
leadership failed to foster a culture of critical self-
assessment and was not aware that daily performance standards 
had degraded to an unacceptable level. Crewmembers did not 
attend the navigation brief and lacked basic knowledge and 
proficiency in steering and propulsion.
    The Strategic Readiness Review found that within the Navy 
a, quote, normalization of deviation took root in the culture 
of the fleet. The review concluded that the Navy came to accept 
a lower standard performance until that lowered standard became 
the new norm. As an example, the GAO (Government Accountability 
Office) report found that the number of expired certifications 
among forward-deployed naval forces in Japan skyrocketed from 6 
percent in 2015 to nearly 40 percent in 2017. I note that most 
of the testimony from the Secretary and the Admiral have noted 
the need for increasing the size of the fleet, a bigger fleet.
    I have a question for you. Were the Antietam, Champlain, 
Fitzgerald, and McCain experiences outliers or are they tragic 
revelations of an unacceptable safety culture in our Navy?
    Admiral Richardson. Sir, there were definitely some 
problems, as you noted, on those ships. And I think that my 
culture and the culture of the Navy is that we don't take 
anything for granted when we see those sorts of indications. 
And so we did thorough investigations into the individual 
circumstances surrounding each of those individual events. 
That's--you know, we did four separate investigations, and you 
quoted from those for the Fitzgerald.
    When you see incidents like that, multiple incidents, it, I 
think, is incumbent upon leadership to back up and at least 
explore the question as to whether we've got a systemic issue. 
And that's what the Comprehensive Review and the Strategic 
Readiness Review were about. Anytime you dive in and take a 
look at something like that, you're going to find something. We 
did, and we put a comprehensive recovery plan in----
    Senator Durbin. That goes to the heart of it, Admiral. Was 
this isolated? Were these outliers? Or was the Strategic 
Readiness Review finding that the Navy has accepted a 
normalization of deviation as the culture of the fleet?
    Admiral Richardson. Not the entire Navy, sir. And as a 
counterexample, we can point to the strikes just last--recently 
in Syria. The continued strikes executed safely and effectively 
in the fight against ISIS (Islamic State of Iraq and al-Sham), 
the strikes into Syria last year, the vast majority of your 
Navy is performing its mission effectively and safely. However, 
every chance we get to improve, every chance we get to correct 
deficiencies, we're going to leap on those with an aggressive 
stance and fix them.
    Senator Durbin. I guess--I pray you're right, and I hope 
you're right, and I have no reason to believe you're not 
correct in what you've just said, but the point I was trying to 
make in this question was I would think before you give us 
testimony about building a larger fleet, we talk about the men 
and women who serve the United States Navy and our Nation and 
making certain that they're doing their job effectively, that 
they're not fatigued, that they are prepared, and when called 
on, will perform their responsibilities safely and come home 
safely.
    Admiral Richardson. Senator, we talked about a balanced 
approach, which included not only capacity, but also readiness, 
increased time at sea to get--you know, practice those skills 
and to strike that balance. And so that's what I hope to convey 
with our budget request.

                            WOMEN IN COMBAT

    Senator Durbin. General Neller, recent articles have been 
written about the training of women in the Marine Corps for 
combat. Has there been any change under your watch with the 
Marines in terms of training women for combat service?
    General Neller. Senator, women have been in combat in the 
Marine Corps since we've had women Marines, so what's changed 
is the assignment of women to ground combat units and to 
specific MOSs. So----
    Senator Durbin. Is it not true that the assignment of women 
for combat training has been diversified now, that they're now 
being trained on the West Coast, too?
    General Neller. Women--women Marines are all trained at 
Parris Island right now. And they had previously all--all 
Marines, when they graduate from boot camp, regardless of their 
MOS, go to what we call Marine Combat Training, which is basic 
infantry training, for 28 days. Up until a few months ago, all 
the women from Parris Island went to our training School of 
Infantry on the East Coast. But you are correct, we have 
decided, particularly based on where those Marines might have 
their follow-on training or where they were recruited from, 
that it was more cost effective and efficient to send them to 
School of Infantry on the West Coast. So, yes, sir.
    Senator Durbin. Are you familiar with the article written 
by Kate Germano, who served for 20 years in the Marine Corps 
and retired as a lieutenant colonel, about the training of 
women in the Marine Corps for combat?
    General Neller. I have read some of Colonel Germano's 
writing; yes, sir.
    Senator Durbin. And what do you make of it?
    General Neller. I think Colonel Germano was trying to up 
the requirement for female recruits and the training for them 
to become Marines, and I would say based on my observation and 
what we've implemented, a great number of the things that she 
expressed concern with have been implemented and are currently 
taking place today at Parris Island, South Carolina.
    Senator Durbin. Thank you very much.
    Thanks, Mr. Chairman.
    Senator Shelby. Senator Collins.

                              SHIPBUILDING

    Senator Collins. Thank you, Mr. Chairman.
    Secretary Spencer, let me begin by thanking you for coming 
to Maine and visiting Bath Iron Works. I can't tell you how 
well received your visit was by the hardworking shipbuilders at 
BIW (Bath Iron Works). And I very much appreciate your coming 
to visit.
    In the fiscal year omnibus bill, Congress decided to 
authorize the DDG-51 multiyear despite some reservations that 
GAO and others had brought up. It is, therefore, critical that 
the Navy carefully manage this multiyear procurement so that 
both large surface-combatant shipyards have stable and a 
balanced program workload to sustain the industrial base. In 
fact, we included some report language as we authorized the 
multiyear that included a requirement that the Navy report on 
how the multiyear Acquisition Strategy addresses workload 
balance, stability, and viability for both DDG-51 shipbuilders. 
Is the Navy, in fact, taking steps to ensure that the DDG-51 
multiyear will sustain both yards?
    Secretary Spencer. Senator, in February of 2018, we put the 
RFP (request for proposal) out for the Flight 3, as you know. 
It is a continual concern of mine and something that I monitor 
regularly, which is the health of the industrial base across my 
portfolio, but know that when it comes to the large 
shipbuilders for DDG in particular, we are specifically 
looking--constantly looking at workload balance in that regard.
    But I want to--I want to punctuate that because my 
fiduciary responsibility--while we're partners in this with our 
suppliers, my fiduciary responsibility is to get the best value 
for the taxpayer. We have to work as a team, whether it be the 
DDG program, whether it be the submarine program, across the 
board, the workers are out there doing their best, management 
of their workers has to lean in, too, to make sure that they 
are providing the best for the team to produce at their optimum 
capacity, and that's another thing that we will ensure going 
forward, Senator.
    Senator Collins. Thank you.
    Admiral Richardson, nice to see you again. I always want to 
remind you of your graduating from Kittery High School and your 
strong ties to the State of Maine.
    You recently outlined your vision for the next generation 
surface combatant acquisition to replace the Navy's aging 
cruisers, which included looking at existing hull forms as a 
base for a future combatant. How might the Zumwalt's unique 
capabilities, such as excess power capacity, inform the Navy's 
thinking about the next class of large surface combatant ships?
    Admiral Richardson. Ma'am, thank you very much. And it's--
it's great to see you again as well. You've hit exactly on a 
centerpiece of the strategy going forward, which is to garner 
as many of the lessons learned and roll those into the new ship 
as quickly as possible. I will tell you, we are learning more 
lessons from Zumwalt every single day about the capability that 
ship brings, whether it be power generation, the role of 
stealth, the volume that the ship brings, the capability of the 
ship to bring down, you know, very sensitive communications, et 
cetera. And so that's exactly the types of lessons that I would 
look forward to rolling into the next ship.
    Senator Collins. As the Navy begins planning for this next 
generation of large surface combatants, how can the Navy ensure 
a smooth transition? As you know, there were some disruptions 
in workload and difficulties in going from the DDG-51s to the 
DDG-1000s and then back with the restart of the DDG-51s. What 
lessons have we learned from that?
    Admiral Richardson. If there is one word I think that 
describes the major takeaway, it's ``stability.'' And so we 
would ask and hope for stability in terms of funding and a 
return to normal order so that that part is there. On my part, 
it's stability of requirements and stability of design that 
allows us to put together a program that meets the Nation's 
needs, that is stable and predictable, and then can be executed 
in a way that is smooth and sails right through.
    Senator Collins. Thank you, Mr. Chairman.
    Thank you all for your service.
    Senator Shelby. Senator from Hawaii.
    Senator Schatz. Thank you, Mr. Chairman. Thank you all for 
being here.
    Secretary Spencer, I wanted to follow up on Senator 
Durbin's line of questioning around the Comprehensive and 
Strategic Readiness Reviews. My question is quite 
straightforward. A lot of the recommendations have to do with 
changes within the organization. And I'm wondering where we 
find the resourcing and the sort of budget ``money where your 
mouth is'' behind the Readiness Review in the coming budget 
request.
    Secretary Spencer. Senator, you hit the nail on the head. 
If you divide out the recommendations from the Strategic 
Readiness Review and the Comprehensive Review, the Strategic 
Readiness Review is primarily more management oriented and 
don't really have that many dollars attached to it. The 
Comprehensive Review, addressing everything from common bridge 
components to training to bricks and mortars. If I'm not 
mistaken, we're somewhere around the $600 million range for 
that needed for funding to address the Comprehensive Review 
issues.

                 OPERATIONS IN THE ASIA-PACIFIC REGION

    Senator Schatz. Thank you.
    Admiral Richardson, I want to talk to you a little bit 
about freedom of navigation operations. Obviously, the Navy 
plays an essential role in challenging unlawful claims around 
the world, and I won't ask you to talk about current or future 
FONOPS (Freedom of navigation operation), but I just have a 
basic question about how we approach these, and I don't mean to 
be pejorative, but the only way I can frame it is whether or 
not you have a sort of a comprehensive strategy as it relates 
to FONOPS or if your strategy--and this may be the right way to 
do it--is to be somewhat more reactive to incursions, to 
unlawful claims, to inappropriate actions from some of our peer 
adversaries.
    So the question is, Do we sort of monitor the situation and 
respond as necessary, or do you have a schedule or a theory of 
the case that you implement regardless of circumstances, or is 
it a blend?
    Admiral Richardson. I would say your last comment hits it 
on the head, sir. It's a blend. And so strategically we're out 
there to advocate for the normal rules and norms that govern 
commerce and free flow of trade in the global commons. And so 
that's why we are there. We are present wherever international 
law allows us to sail and fly, and we'll continue to do so to 
advocate not only for us, but for everybody else. Having said 
that, there are--we've got to be like foxes, we've got to be 
responsive to opportunities as they present themselves inside 
that strategic framework. And so that's how we approach it.
    Senator Schatz. What new partnerships with other countries 
give you the most optimism? And who do you want to kind of move 
from neutral to leaning away to our side of the ledger?
    Admiral Richardson. Sir, there are all sorts of dynamism in 
that regard in the Pacific theater, and so we've got our 
staunch allies: Japan, South Korea, Australia, those sort of 
folks. But we're seeing great opportunities with partners like 
India, partners like Vietnam even. And so there is an emerging 
dynamic----
    Senator Schatz. Indonesia?
    Admiral Richardson. Indonesia.
    Senator Schatz. Malaysia?
    Admiral Richardson. Malaysia. That entire region is----
    Senator Schatz. Where do you see the Philippines in that?
    Admiral Richardson. The Philippines is a traditional strong 
ally of the United States.
    Senator Schatz. Still?
    Admiral Richardson. Still.
    Senator Schatz. Good.
    General Neller, Guam, I'd like to talk to you about Guam, 
as usual. What is the status of building training ranges at 
CNMI (Commonwealth of the Northern Mariana Islands)?
    General Neller. Senator, there are still some environmental 
impact issues with those training ranges, specifically on 
Tinian, and there are some other legal issues with ancestral 
homeland on Pagan. The training on Guam proper, those ranges I 
think are not going to be an issue. So there is construction 
going. We're still committed to the entire DPRI IP plan, reduce 
the number of Marines on Okinawa, moving out of Futenma to the 
Futenma Replacement Facility, and Marines are going to go to 
Guam. So--but we need to be able to train and we need to be 
able to move off that island.
    Senator Schatz. So I'm hearing that you think you're on 
track, but if you fall off track, I assume that impacts unit-
level readiness?
    General Neller. We've always stated, the Marine Corps has 
always stated, that for us to go to Guam, those units that go 
there have got to be able to maintain their readiness.
    Senator Schatz. And what's your level of confidence right 
now about staying on track with respect to construction?
    General Neller. I'm not going to speculate. We're operating 
on the assumption that these things are going to get resolved 
and we're going to be able to train there.
    Senator Schatz. Okay.
    And, Secretary Spencer, I'll take this one for the record. 
There is strong support from PACOM and PACFLT for the 
University of Hawaii's application to establish a Navy ROTC 
program. And can you please follow up for the record with a 
definitive answer about what the Navy would need in order to 
support the University of Hawaii's Navy ROTC application?
    Secretary Spencer. Senator, just to--duly noted, and to let 
you know that--you might have seen it in the press--that we are 
doing a benchmark review of all our educational institutions, 
and we're going to actually address the ROTC issue there. So 
duly noted, and I will respond.
    Senator Schatz. Thank you.
    Senator Shelby. Senator Blunt.

                             NAVAL AVIATION

    Senator Blunt. Thank you, Chairman.
    Thank all of you for being here.
    Admiral Richardson, Senator Durbin and I and members of 
this committee generally always are very engaged in the 
discussion about the F/A-18 Super Hornet production. I think 
we've--generally that's been sort of at the top of the unfunded 
list. I believe this budget has fully funded the line for the 
coming year. And mostly I just didn't want to fail to mention 
this once again, that this is an item we care about a lot. The 
question I have for you, though, is the competition for the new 
aerial unmanned refueling asset and how that's going and how 
you see that unmanned refueling as an important part of the 
future of the Navy.
    Admiral Richardson. Senator, thanks. And I just want to 
double down on the importance of the F/A-18 Super Hornet as a 
current and continuing part of our future naval air wing, and 
so we're completely behind you on that.
    With respect to the MQ-25, the unmanned aerial tanker, this 
is a signature program for the Navy that is not only going to 
fulfill a critical readiness and capability gap, the ability to 
fuel strike fighters, which will liberate additional strike 
fighters to go do a strike-and-fighter mission, which are 
currently tanking. And so this will not only extend the range 
of the air wing, but also reap benefits in terms of increasing 
the striking power of the air wing as well.
    We brought in industry very, very quickly on that. Early on 
in the problem, we leveraged the technology that had been 
developed to date so that we could move quickly to production 
on this. Competition is going very well. We are currently in 
the evaluation of that, and we expect award of contract later 
this year.
    Senator Blunt. Later this year?
    Admiral Richardson. Yes, sir.
    Senator Blunt. Okay, thank you, Admiral.

                           FORT LEONARD WOOD

    General Neller, as you know, I think there are more Marines 
at Fort Leonard Wood because of the schoolhouse that is run 
there than there are at any other non-Marine base in the 
country. We're certainly glad to have those Marines. I know 
you're looking at the feasibility of moving the civilian law 
enforcement training to Fort Leonard Wood, where other military 
police training goes on. And I'm wondering if you could discuss 
the benefits of potentially unifying that training at one 
location.
    General Neller. Well, Senator, you're correct. I visited 
Fort Leonard Wood about 6 months ago, and I--you would think 
after being in the Marine Corps this long, I would know where 
all the Marines were. I was--there are a lot of Marines there. 
We've got our Motor Transport School and we've got our 
Chemical, Biological, Radiological and Nuclear Defense School 
there. And we also train our military police Marines. And I 
believe there's a study ongoing now to take a look at whether 
civilian law enforcement go there. Obviously, if you can 
consolidate any training and achieve economies of scale, 
particularly where you have a school for military police, that 
there's going to be advantage to that. So we're still waiting 
for the final results of that. And I would ask that I can give 
you the results of that when we get the final readout on that 
report.
    Senator Blunt. That would be great. I hope you continue to 
look at the feasibility of that. And I know you're encouraging 
them to get to a final conclusion soon and hope to be updated 
on that.

                               READINESS

    And Secretary Spencer, my question for you is, As we talk 
about continuing to add to the equipment, add ships to the 
Navy, how does that compete with the readiness concerns that 
we've seen, and I know you have? You're adding more ships in an 
environment where we've had a hard time keeping all the ships 
we currently have ready. And just your thoughts on how we do a 
better job of balancing those things.
    Secretary Spencer. Senator, to frame an answer for you, to 
grow the fleet is one bar in the chart. And there are two other 
bars that need to be acknowledged, and that's the manpower 
needed to support the ships and the actual maintenance needed 
to keep them going. That is the full life-cycle cost of the 
platform. We are analyzing that as we go forward.
    When it comes down to the actual tactical measures we're 
doing, we are actually starting to see the needle move when it 
comes to ship maintenance. There are some efforts underway that 
we're reaching out to the private sector to take some best 
practices from them. We're learning some lessons already that 
we're indoctrinating into both depot-level aircraft maintenance 
and ship availabilities. We're taking this all into effect 
because as we grow the fleet, we have the responsibility in 
spending the resources to make sure they're put forward to make 
it a more efficient and effective team.
    Senator Blunt. Well, I think we all know we've been asking 
too few people to do too many things with equipment that wasn't 
where we'd want it to be, and I know that's an important 
priority for you, and I'd suggest it is for the committee as 
well. So hopefully we can work together to make it a priority.
    Secretary Spencer. I look forward to it.
    Senator Blunt. Thank you, Chairman.
    Senator Shelby. Senator Reed.

                       SUBMARINE INDUSTRIAL BASE

    Senator Reed. Thank you, Mr. Chairman. And also let me 
thank you and the Vice Chairman, Senator Durbin, for your 
support of $225 million to expand funding for the submarine 
industrial base supply chain. It's deeply appreciated. Thank 
you, sir.
    And with that, Mr. Secretary and Admiral Richardson, the 
supply chain for submarine construction is absolutely critical 
as we try to continue to build the Virginia-class and put the 
first Columbia-class in the water. Can you comment on where we 
are in the supply chain? And do you need additional resources 
this budget cycle to continue to make improvements?
    Secretary Spencer. Senator, the supply chain is--it's 
coming forward over the last 5 years. It is an absolutely 
critical topic that we discussed, and it was not readily 
apparent to many people going forward as to the importance of 
it. We are looking at this with a fine-toothed comb, both the 
Navy in partnership with our suppliers, because that is what 
puts the whole ship together. And when it comes to the 
Virginia-class and the Columbia, and I will also put in there 
also our carrier efforts, it is a combined, in many cases, an 
overlapping, supply chain.
    Our integrated plan working with both our suppliers and the 
Navy are combing through the supply base. We've done it. We 
have joint efforts going on. How can we make a supplier a 
better supplier? What do they need? The questions are being 
asked now when we approach contracting is, Fine, what are 
benefits that you can provide us? And they might come back and 
say a 10 percent savings. Our immediate response is, ``What can 
we do for you to get to 20 percent savings?'' as an example. 
That is how we're working with the supply base because it's 
going to be critical to get both the Columbia on-station, 
Virginia payload mod, and the carriers.
    Senator Reed. Admiral?
    Admiral Richardson. Senator, let me just pile onto that.
    Senator Reed. Yes, sir.
    Admiral Richardson. One, I concur with everything that the 
Secretary said. And as you know, some of the second- and third-
tier suppliers have really been hanging on by the skin of their 
teeth here as we've worked through some of the continuing 
resolutions and Budget Control Act sequestration levels of 
discussions. And so they are breathing a cautious sigh of 
relief with these new funding levels. So we're taking a very 
integrated approach to this problem, making sure that we 
continue to ensure the viability of the second- and third-tier 
suppliers as well.
    Senator Reed. Let me raise another issue related to the 
supply chain. Reports that we've heard periodically, in fact, I 
think when Secretary Kendall was here, he indicated that a 
great number of unclassified components were basically in the 
hands, either physically or virtually, of our adversaries, 
which goes to the whole issue of the security of the supply 
chain as well as their ability to produce material. So any 
comments about that? Is that part of your focus, too?
    Secretary Spencer. Senator, it is. In my previous 
testimony, as you might have me heard, that we were about to 
let a contract to a company that provided digital modeling for 
the Navy and were going to put some MSC (Military Sealift 
Command) ships in there so we could do predictive maintenance, 
et cetera. We found out that the division of the prime that was 
providing the company was--actually had a joint venture with 
Huawei. We raised our hand and said, ``Let's get the company on 
the phone, find out what this is all about.'' We were told, 
``No problem, we're not using Huawei software or hardware.'' We 
asked, ``Fine, can we see the governance documents for the 
joint venture?'' and all of a sudden the phone line got kind of 
quiet, to be very frank with you. We have responded by putting 
prophylactic language in there that will protect us. We've yet 
to see the response from the prime yet. We await that.
    This is a continuing issue. We have an office inside the 
Department of Defense called OCEA, the Office of Commercial and 
Economic Activity, that the Navy and the Air Force have been 
funding on a pilot basis, that is specifically rooting this 
out, because what we're finding when we drill down is if you go 
two and three layers of holding companies, all of a sudden 
China, Inc., is the owner, and we have to start paying 
attention to this, and we are.
    Senator Reed. Thank you, Mr. Secretary. Thank you very 
much.
    Just let me raise an issue that we've talked about before, 
Mr. Secretary, and this is one that is not exclusive to the 
Navy, but important, and that is in Newport. The Navy base is a 
key asset of not just the Navy, but national security with the 
War College and everything else. But it's also been a way in 
which we've been able to support Coast Guard activities, and 
it's been a collaborative effort. And again, with the help of 
the chairman, we've been supporting NOAA's (National Oceanic 
and Atmospheric Administration) activities in terms of planning 
to provide a basically new pier operation there that could be 
used by the Navy in times of need, but also something that 
would add again quality and capacity to the base. And again I 
would like your help and support as we go forward, if we could.
    Secretary Spencer. Most definitely, Senator. We talked 
about this. The logistics of incorporating a whole-of-
government solution, shall we say, we're totally open to that. 
It goes to speak to, if I could use this as a moment to keeping 
our infrastructure in place, that infrastructure really is a 
key component of readiness.
    Senator Reed. Thank you. Now, my real concern is about 
investment in certain athletic fields in the State of Maryland, 
but I will not push that issue. Thank you.

                           HYPERSONIC WEAPONS

    Senator Shelby. I'll direct this question to the admiral 
and to you, too, Mr. Secretary. I don't know what you can get 
into here in this committee, but in the area of super 
development and deployment of hypersonic weapons, our 
adversaries or would-be adversaries, maybe our competitors in 
the world, are certainly developing a strong weapons system in 
the area of hypersonic.
    Admiral Richardson, are we still on the cutting edge? Are 
we trying to catch up? Or do you feel fairly good about that? 
Because they could be a huge threat to our fleets, could they 
not?
    Admiral Richardson. Mr. Chairman, you've got that exactly 
right, and I don't get paid to feel good about anything, and so 
I approach it all with a sense of urgency. We're moving out 
urgently in the area of hypersonics. The Navy is going to be 
appointed the lead--has been appointed the lead service to lead 
the Department's effort in hypersonics. We look forward to 
following through, laying in the investment of the program to--
--
    Senator Shelby. Should we get into that program a little 
bit in a classified area?
    Admiral Richardson. I look forward to giving you a brief on 
that; yes, sir.
    Senator Shelby. Thank you.
    Mr. Secretary.
    Secretary Spencer. If I could put a punctuation on that, 
Mr. Chairman, as Secretary Mattis says, too, the service 
secretaries were not paid to be patient. Hypersonics is one of 
the 10 bins that Mike Griffin and RD&A (Research, Development 
and Acquisition) are totally focused on. As the admiral just 
said, we are the lead in this thing, but the three--Dr. Esper 
and Dr. Wilson and I speak about this with some regularity on 
how we can combine our dollars and do the fastest, best based 
research going forward, and then take each weapon to each 
service.
    Senator Shelby. Was that what Mr. Putin was referring to 
when he was talking about all the advanced weapons and what 
they could do to our shield and so forth? Was he alluding maybe 
or maybe not to hypersonic weapons or what? What do you think? 
I know it's speculation.
    Secretary Spencer. Speculation is yes, sir.
    Senator Shelby. Okay. Admiral Richardson, do you agree?
    Admiral Richardson. It's difficult. With cartoon drawings 
and everything else, it was difficult to figure out----
    Senator Shelby. Thank you.
    Admiral Richardson [continuing]. But I think we've got that 
situation covered; yes, sir.
    Senator Shelby. Thank you very much.
    Senator Murkowski.

                             ARCTIC ISSUES

    Senator Murkowski. Thank you, Mr. Chairman. Mr. Chairman, I 
want to thank you for the hearing today.
    Gentlemen, thank you for your leadership.
    I want to talk about Arctic and Arctic issues. It might 
have a little bit to do with the Chairman's favorite subject 
when we discuss appropriations, and that's icebreakers and the 
need for them.
    Let me start with you, Admiral. Just the importance of 
working with our partners and our allies as we project power in 
the Arctic. In November, NATO (North Atlantic Treaty 
Organization) Secretary-General Stoltenberg announced plans to 
create an Atlantic Command, which will cover the Arctic. Do you 
think that this counterbalances Russia's Joint Artic Command?
    Admiral Richardson. Ma'am, there is no question that with 
the dynamism in the Arctic, the receding ice cap, the opening 
of strategic waterways, the uncovering of continental shelves 
with their attendant resources, that there is an increasing 
strategic urgency in the Arctic. That effort plus the efforts 
that we're working with the Coast Guard, including their 
effort, the Coast Guard's effort, to get started again building 
icebreakers are all part of us addressing this emergent 
strategic opening.
    Senator Murkowski. Well, I appreciate your focus on it and 
recognizing that as we deal with an area that has really for 
some kind of been off the map, off of people's radar screen, 
that we recognize that in order to play, we've got to have the 
requisite infrastructure, and infrastructure includes, most 
specifically, the icebreakers. It's my understanding that NATO 
inventories on icebreakers include one for the U.S., eight in 
Canada, with six Navy icebreakers planned, Norway has one. And 
by 2022, NATO is going to be looking at a total of 16 
icebreakers while Russia has close to 50. Canada is obviously 
moving ahead with procurement on a much larger scale. But you 
mentioned the connect, with working with the Coast Guard in 
producing dedicated icebreakers. But I'm looking at this and 
saying one icebreaker does not a fleet make. And we recognize 
that the Strategy calls for six. But do you think that we 
should be more aggressive in this area, perhaps following 
Canada's lead in procuring icebreakers, not only for the Coast 
Guard, but also dedicated icebreakers for the naval fleet?
    Admiral Richardson. Ma'am, it's a timely question regarding 
activity in the Arctic because we just rolled out this year's 
ICEX (Ice Exercise).
    Senator Murkowski. Right.
    Admiral Richardson. We've been dedicated to going up there 
with our submarine force every other year for decades now. This 
time we went up with two U.S. submarines and a British 
submarine. And so we--it has not been off our radar I guess is 
my bottom line.
    With respect to the icebreakers, that is a historic and 
very well-defined Coast Guard mission. The Navy looks forward 
to supporting the Coast Guard in every way to build the number 
of icebreakers that we need.
    Senator Murkowski. Well, know that I'm going to continue to 
be aggressive in my push for not just one, but for meeting the 
needs that we have as an Arctic nation.

                         EXERCISE NORTHERN EDGE

    Secretary Spencer, I want to talk about Northern Edge, the 
exercise in Alaska. It's obviously a very important exercise 
for the military and for the communities, the coastal 
communities that support it. Thank you for the outreach that 
the Navy played last year around the gulf after the 2017 
exercise to communicate with the affected communities to give a 
little bit of a debrief and to really have that public 
engagement.
    As you know, I've been kind of outspoken on behalf of these 
communities in urging a greater openness. One of my big 
concerns about the exercises in the past has been the potential 
for impact on our fisheries. This is our number private 
employer. Making sure that we have good, strong, sustainable 
fisheries is key.
    The decision to do the 2017 exercise in May caused a lot of 
consternation among the fishing fleet concerned about impact to 
the salmon migration, given the timing. We've got 2019 that is 
in the planning. And what I would ask of you is that you engage 
with communities around the Gulf of Alaska to collaboratively 
determine a time for the exercises to take place that will have 
the least possible risk for negative effect and conflict with 
the fisheries. So I would ask for your commitment to work with 
my office, to work with the impacted communities, to ensure 
that the concerns that the fishing communities have are 
addressed before we finalize a date for the next Northern Edge.
    Secretary Spencer. Senator, you have my commitment, and as 
you know, the last cycle, we did have good communications. We 
are acutely aware of our responsibility as a Navy, doing our 
training both environmentally and community-wise. You will see 
that we had the conversations that no more SINKEX (Sink 
Exercise) and minimal use, especially in certain grounds of 
explosives. We are talking, but this is a fine example. We look 
forward to going forward and making sure that all communities 
have input and we balance out the outcome.
    Senator Murkowski. Good. Well, I appreciate that. I look 
forward to working with you. Know that Alaskans are very proud 
of the fact that we have superlative training areas in the air, 
on the land, and in the sea, but making sure that we have good 
strong relationships with our military as you move forward in 
these is I think key to the ongoing goodwill that is created on 
both sides.
    Secretary Spencer. Sustainability is our key.
    Senator Murkowski. Thank you, sir.
    Thank you, Mr. Chairman.
    Senator Shelby. Senator Hoeven.
    Senator Hoeven. Thank you, Mr. Chairman.
    I'd like to thank all three of our witnesses for being here 
today and for your service to our country.

                            NUCLEAR POSTURE

    And Mr. Secretary, to you or to the Chief of Naval 
Operations, how long will it take for the Navy to integrate a 
low-yield warhead into the Trident ballistic missile, as 
envisioned in the most recent Nuclear Posture Review?
    Secretary Spencer. Senator, if you look at how we're going 
to get to a low-yield path, you have the W76-1 is our prime. We 
believe there is an ability to--a path off of that with a -2 
model that would be an immediate path to a low-yield. And then 
we also have to put money in PB18--I beg your pardon, 19--to 
look forward to an outward-looking weapon to do the exact same 
thing. So we have a near-term fix and long-term research.
    Senator Hoeven. Are you on your schedule?
    Secretary Spencer. That I'll get back to you, sir.
    Admiral Richardson. We're just getting started, sir.
    Secretary Spencer. Yes.
    Admiral Richardson. The Nuclear Posture Review just came 
out. So by definition, yes, starting line, and we'll look 
forward to staying----
    Senator Hoeven. So when you look at the 2018 and 2019 
budgets, you realistically feel that you're--you'll be on the 
schedule you've at least charted at this point?
    Admiral Richardson. We'll deliver this thing on the 
schedule the Nation needs; yes, sir.
    Senator Hoeven. And how does that timing sync with the 
Columbia-class going from the Ohio boomers to the Columbia-
class? Or will this update beyond the Ohio's or will it await 
the Columbia-class?
    Admiral Richardson. We anticipate that this will be used on 
the current Trident-class, Ohio-class submarine, and they will 
also transition to Columbia-class.
    Senator Hoeven. How about are there synergies? Because the 
Air Force is doing the same thing, it's upgrading its ballistic 
missile fleet long-range standoff, as you're aware, as well as 
upgrades to the Minuteman III. Are there synergies in the 
programs both in terms of, for example, the LRSO (Long Range 
Stand Off) in the Air Force case, and ICBM (intercontinental 
ballistic missile) versus the SLBM (submarine-launched 
ballistic missile) and the upgrades to the missile----
    Admiral Richardson. Yes, sir. Senator, as you know, we've 
sort of time-phased the upgrade to the D5 missile program so 
that we don't create a gigantic funding mountain trying to 
upgrade everything at once. And so following the Columbia-class 
introduction into the fleet, that's when we'll address the 
upgrades to the D5. I think there are tremendous opportunities 
for commonality between the two services as we do that.
    Senator Hoeven. Well, that's what I'm wondering. In terms 
of the nuclear triad, the bombers, ICBMs, you know, part of 
that's working together to maintain that triad. As we do these 
upgrades, which are expensive and take time, but which we need 
to do, and we need to bring in on the timelines we talk about 
so we stay ahead of any defensive systems, you know, is there 
an active effort to synchronize and share research, share 
costs, and so forth, and make sure we hit these timelines that 
we've laid out both in terms of funding and getting the 
programs done?
    Secretary Spencer. Senator, most definitely. If you look at 
the arrival of Mike Griffin at DOD (Department of Defense), one 
of his charges is to align the services to make sure that R&D 
and S&T dollars are being spent to the priorities of the 
National Defense Strategy. We're binning those already. The 
dollars for this are aligned.
    What you're seeing also is the services now communicating 
quite rapidly amongst themselves when it comes to S&T and R&D 
dollars to ensure that we are aligning the dollars in the most 
effective, responsible manner.
    Senator Hoeven. Yes, again, doing that with programs like 
the F-35 and so forth, it seems to me we need to be looking to 
do the same thing.
    Secretary Spencer. Most definitely.
    Senator Hoeven. And again I want to commend you both on the 
operation in Syria. Unbelievable professionalism and I just 
can't say enough how much we appreciate it and commend you, and 
the men and women obviously in uniform carrying it out. 
Unbelievable.
    Admiral Richardson. It's really them that did it, sir. It's 
the--those men and women deployed around the world.
    Senator Hoeven. Absolutely.
    Admiral Richardson. That's what they do.
    Senator Hoeven. Absolutely. And so we need to continue to 
make sure they have the technology to stay ahead of our 
adversaries.

                           MILITARY MANPOWER

    General Neller, manpower levels. Talk about where you 
feel--talk about, do we have enough manpower in the Marine 
Corps and are we able to recruit to it? Just give me your sense 
of that.
    General Neller. The answer, Senator, is yes and yes. I'll 
take recruiting. We've been--our recruiters work really, really 
hard, and we're running 99.9 percent high school grads. We're 
in the highest categories. We start each month, even in the--
the hardest time to recruit is in the winter. Now as we get 
into June, we'll start, you know, looking if people are going 
to be prospective high school seniors, and we're shipping 
people that have been in the delayed entry program. So we never 
take that for granted, just like we never take making Marines 
for granted at the recruit depots.
    As far as the size of the Marine Corps, a couple of years 
ago, we were looking at going to 182 or possibly lower. This 
budget that we've been afforded allows us to go to 186.1. I 
would like to get our dep-to-dwell down, but I'm more concerned 
now that we have the right capabilities within the 186. The 
Marine Corps we're going to see in the future is going to be a 
little bit older. We've always been the youngest force, running 
about 62 percent of the Marine Corps 25 years old or less, but 
the capabilities we need in the future are going to be 
individuals that have gone to school for a while, have had more 
extensive training in the areas of electronic warfare, cyber, 
information ops. So advising, there are a number of things that 
we have ongoing that are going to make the Marine Corps a 
little bit older and make us a little bit more expensive.
    So we don't need right now more infantry battalions, we 
need these other capabilities. So I am focused right now on 
modernizing the force that we have and getting ready for the 
future fight and making sure that we have people trained to 
operate the capabilities we're going to need, not just 
tomorrow, but 5, 10 years from now. So I think we're in a good 
place.
    Senator Hoeven. Thank you.
    And again thank you to the men and women in uniform. Just 
amazing what they do for us around the globe.
    Thank you very much.
    Senator Shelby. Senator Baldwin.
    Senator Baldwin. Thank you, Mr. Chairman.

                          LITTORAL COMBAT SHIP

    Secretary Spencer, I'd like to discuss the littoral combat 
ship, both in the terms of the fiscal year 2019 budget request 
of only one ship and in terms of the fiscal year 2018 and 2019 
Acquisition Strategy.
    First I'd like to say that I really appreciate your taking 
the time to have a couple of recent conversations about these 
issues and our shared belief in the importance of our 
shipbuilding industrial base. It's the industrial base, 
specifically the LCS shipyard in my home State of Wisconsin, 
that I'm concerned will be hurt by this budget request and the 
Acquisition Strategy, neither of which meet the standards set 
by President Trump to support U.S. manufacturing and the 
American workers and build a 355-ship Navy.
    Navy officials have consistently noted the importance of 
avoided--avoiding a production gap and layoffs at the LCS 
shipyards as the Navy transitions to the frigate. Admiral 
Neagley testified last year that three LCS ships per year is 
the optimal number of ships to maintain the workforce and 
maximize efficiency at the shipyards. And last month, Assistant 
Secretary Geurts said that, ``obviously not operating at 
optimal production rates will cause some concerns to workers 
and we'll have to spin that workforce back up as soon as we 
make that transition.''
    Put simply, one LCS in fiscal year 2019 will result in 
shipyard layoffs, and that's a highly skilled workforce that 
can't simply be spun back up. On the contrary, two LCSs in 
fiscal year 2019, one shipped to each yard, will result in the 
minimum sustaining rate needed to maintain the workforce and 
effectively compete for the frigate, competition which is 
needed to ensure the best value to the Navy and to our 
taxpayers.
    Similarly, I am concerned that the Navy's fiscal year 2018 
and 2019 Acquisition Strategy, which is based on a lowest price 
competition, and which we talked extensively about, would harm 
the Wisconsin shipyard because it fails to consider the unique 
capabilities, cost structures, and workforces of each LCS 
variant. Indeed, for complex defense programs like LCS where 
innovation and capability are prized, lowest priced contracting 
methods are inappropriate because they fail to provide the best 
value to the Navy.
    So, Mr. Secretary, will you ensure that the Navy's LCS 
acquisition strategy, number one, follows an equitable and best 
value approach; number two, takes into account the differences 
between the LCS variants regarding capabilities, service life, 
and total life-cycle cost; and three, considers the negative 
impacts of potential workforce layoffs to the Navy and 
industry?
    And as I noted in my recent letter to you, allow me to 
preface your response with my belief that the Saudi ships that 
we discussed, which cannot be accelerated without injecting 
unacceptable risk into the program, are not, in my opinion, a 
substitute for LCS, and that the previous ship backlog at 
Marinette yard is now clear and therefore, will also not 
provide the sufficient work for the shipyard.

                          LITTORAL COMBAT SHIP

    Secretary Spencer. Senator, I appreciate your comments. 
Your first three requirements of me I can agree to because we 
do that across contracts no matter what.
    When it comes to price and value, I do want to address 
that. We have an amazing working force out there at all our 
shipyards, and they are owned by companies. And I believe that 
when I talk about the partnership of our suppliers, everybody 
has to get on board. I would say there is probably room at the 
owner of--of the LCS operation up there to be competitive, and 
they should sit down with us and address those abilities to 
become competitive.
    We will watch everything we can do to make sure that the 
workers--that the skilled workers we have do have work. While I 
say that, we are not in it for corporate welfare, to be very 
frank with you, and everybody has to get on board with the 
program, both the suppliers and the Department of Defense, and 
we will work forward in earnest to attain that goal.
    Senator Baldwin. Well, just as a quick follow-up to that, 
obviously, we want the greatest efficiencies we can extract and 
build in, but I hope you acknowledge that there are differences 
between the variants in terms of their capabilities, their 
service life, and total life-cycle costs, and I hope----
    Secretary Spencer. I totally agree with that.
    Senator Baldwin. Okay.
    Secretary Spencer. I totally agree with that. My addressing 
is not the operation of the ship at all. I'm addressing our 
suppliers' management.
    Senator Shelby. Senator Daines.
    Senator Daines. Thank you, Mr. Chairman.
    Thank you, gentlemen, for appearing before this committee 
today.
    Montana is proud to claim one of the highest per capita 
rates in military service in the Nation. As the son of a Marine 
myself, I'm not a Marine, General, but I was raised by one. I'm 
mindful of those serving abroad on the seven seas and around 
the world.
    In particular, I want to recognize the sailors and the 
Marines who train at Montana's two Navy Operational Reserve 
Centers in Billings as well as Helena, supporting worldwide 
missions while also pursuing careers, raising families, and 
being leaders in their communities. Thank you for your 
continued service to them as well as to our Nation.

                     CHINESE TECHNOLOGICAL ADVANCES

    I recently returned from a trip to China. I take a trip 
there every year. I brought along four other Senators with me 
here 3 weeks ago. We met with industry leaders across China. We 
were in Shenzhen, Hangzhou, Beijing, and Shenyang, in fact, 
went down to Dandong, and had a shot across the Yalu River 
there. And my father--after we left China, I was able to text 
my dad in South Korea. My dad just reminded me about the 
tremendous price that was paid there and about some great 
Marines as well as other members that lost their lives.
    But we were really in an innovation deep dive while we were 
there in China. As we can see, the Chinese are leaning forward 
in advanced technology to gain momentum ahead of others. Their 
decision cycle between development and production is faster, 
frankly, than what the DOD is able to do. They are now rivals 
in artificial intelligence, in quantum computing, in 
biotechnology. Having spent 28 years in business, 12 years in 
the cloud computing industry, the innovation ecosystem that 
they are building right now as we speak is something that I 
hope we open our eyes to. I know you all see that, but I 
believe complacency is one of our greatest challenges right now 
in our Nation regarding the potential, not only where they're 
at today, but where they will be here in the not too distant 
future.
    So this is a question for the panel. How is the Department 
of the Navy keeping pace to stay ahead in these technological 
advances that we see? And what can we in Congress do to help 
you in that endeavor?
    Secretary Spencer. Senator, those are great observations. 
Let me preface it by saying besides the comments I made about 
OCEA, the Office of Commercial and Economic Activity, that the 
DOD has underway to look at China's impact on the Department of 
Defense and Navy when it comes to production, I can tell you 
that complacency starts at our country level. The education 
being derived by Chinese from our own educational institutions 
and then retreating back to China, their wanton disregard for 
appreciation of intellectual property, all has to be taken into 
account because we are at competition with them, hand and foot 
competition.
    That being said, what are we doing? If you look at what 
we're doing as far as rapid prototyping, our abilities to sit 
down and focus and align our research and development and S&T 
dollars that coordinate to the support of the National Defense 
Strategy, it's becoming much more focused. The dollars are 
being aligned for a greater output and a more efficient output 
and a speedier output. That is how I would like to frame the 
answer. And I turn it over to the CNO and the General.
    Admiral Richardson. Senator, thanks. I'll just pick up 
where the Secretary left off. Our budget request includes a 
request for what we call accelerated acquisition programs, and 
these are programs and unmanned programs in directed energy, a 
number of programs, where we have put them on a fast lane. And 
I would really advocate the money is moving faster, obligations 
are faster than traditionally done because we are speeding this 
up. We are--you know, we are trying to fight that sense of 
complacency. We are moving out with a sense of urgency. We're 
looking at more mature products and prototyping than we have 
historically done. So I would--I would really ask for the 
committee's support for these programs as we move forward. This 
is what's going to allow us to compete at speed.

                            BUDGET STABILITY

    Senator Daines. Yes, and I'll let the General have the next 
comment, but I remember when we were in the race in our 
startup, and we grew to a large business around the world, but 
our competitive differential was we could run faster than 
anybody else. It was about speed in the innovation cycle no 
doubt.
    Admiral Richardson. That's the key.
    Senator Daines. Yes.
    Admiral Richardson. That's the key.
    Senator Daines. General.
    General Neller. Senator, I, like you, we've been watching 
this for years.
    I assure you that there is no complacency within your 
Marine Corps or your Navy on what's going on. They're--they're 
the pacing threat. The National Defense Strategy tells the 
naval force that, not at the exception of the other potential 
threats out there, but that's the pacing threat.
    So I think to go faster, we all want to go faster, the one 
thing, I hate to say that funding not just the quantity, but 
consistent, sustainable, plannable funding is going to allow us 
to go faster because if someone is going to do business with 
us, we know that the commercial world is now the source of 
innovation as opposed to the government, but they've got to be 
able to work with us, and we've got to be able to say that we 
can provide resources to them. And just like we need our--our 
suppliers out there to know that there's going to be a 
business, and if we start and stop, CR (continuing resolution), 
no CR, they've got to feed their families, they've got to pay 
their payroll.
    The other thing I would say is that we're in competition 
not just technologically, but we're in competition politically 
and policy and for influence around the world. We should always 
be aware of human rights and the actions of other nations, but 
we need to make it easy--easier for others to be our friend. We 
need to be the country of choice for partnership in not just 
the Pacific region, the Indo-Pacific region, but around the 
world. And yes, we should hold those countries accountable, but 
we can't--on a mil-to-mil basis, we can't have generations of 
military officers like we've had in places like Pakistan and 
Indonesia, for good and valid reasons, not be able to come to 
our schools, not to be able to engage with us, not to come to 
this country and become our partners and develop those 
relationships and see what--the way it's supposed to work.
    Senator Daines. Thank you for the comments.
    Mr. Chairman, thank you for your new leadership in the 
Appropriations Committee. As we can hear from our distinguished 
panelists, we can play a significant role here through your 
leadership and trying to get away from the CR nonsense and 
getting back to regular work, which I know you are trying 
desperately to move us in that direction.
    Voice. Hear, hear.
    Senator Shelby. Senator Murray.

                       MILITARY SPOUSE EMPLOYMENT

    Senator Murray. Mr. Chairman, thank you very much. And let 
me just start by saying employment and opportunities for 
spouses of our military is incredibly important. A sailor or a 
Marine's readiness depends on their family being well situated 
as much as it does to their own training. We know that military 
spouses are unemployed or underemployed at rates that are much 
higher than their civilian counterparts and face the additional 
obstacles of having to relocate frequently, transferring 
licenses and credentials, and it's very difficult. I believe we 
can't afford to lose good people who want to serve, but get out 
because their spouse can't find work, and staying in doesn't 
make financial sense to them.
    Perhaps most concerning, I heard recently from military 
spouses in my home State of Washington about challenges they 
look for in facing employment, and they told me that they 
stopped putting on-base addresses or that they are military 
spouses actually on their resume, they just stopped doing it, 
because employers wouldn't call them back if they knew the 
spouse was military affiliated.
    So my question to you today, Admiral Richardson, General 
Neller, are you working with the private sector to overcome 
that type of bias and ensure that they see military spouses as 
an asset?
    And Admiral Richardson, I'll start with you.
    Admiral Richardson. Ma'am, I'll be happy to address that. I 
signed out just recently a framework to get after increasing 
the strength and support to our families. And the bottom line 
of that framework is that a stronger family equals a stronger 
fleet, just as you said. And so we're looking at ways that the 
Navy can support the families directly, which includes going 
out to the private sector, the communities in which we reside, 
our neighbors, and look for employment opportunities. And there 
are a number of also good news stories out there of those 
employers that are opening their doors to the amazing talent 
that we have in our families and our spouses.
    Senator Murray. Okay. Well, I think we have to take 
specific direction on this.
    And General, let me ask you what you're doing.
    General Neller. Last week, Senator, Senator Tillis and 
Senator Kaine had a meeting with some of our senior spouses to 
talk about this very issue. And I think there's some 
legislation being considered to at least emphasize to the 
civilian sector the talent and capability that are there with 
the servicemembers' spouses.
    So it's a difficult problem. And you're right, we recruit 
the individual, we retain the family. So--and the demographics 
are different than they were when I joined 40 years ago. So we 
are looking at a number of things, to include keeping people 
someplace longer. I'm concerned we have a lot of families that 
don't move because the spouse has a job and they've got a 
house, and then we end up with a lot of geographical bachelors 
or bachelorettes around the service, which is not good because 
you want families to stay together.
    So it's a complicated problem. We are looking forward to 
this legislation. A lot of our bases and stations are overseas, 
and their credentials and the things that they bring with them 
are not recognized by the foreign government. A lot of the 
places are in more or less populated areas, so the job 
opportunities just aren't there. But we do everything we can on 
bases and stations to try to afford spouses employment 
opportunities, at least on the base. If they're a government 
employee, they can transfer that. If they come overseas or they 
move, they get certain exceptions to hiring. But it is a 
problem and we're aware of it, and we appreciate the Senate, 
Senator Tillis and Senator Kaine, stepping up to try to help us 
find a solution.
    Senator Murray. Okay, good. I'm happy to work with them, 
and----
    Secretary Spencer. Senator, if I could just weigh in 
because I'm living this. This is an issue my wife has taken on 
while taking her role as wife of the Secretary of the Navy. But 
a month--I believe it was last month, you might be aware that 
the three service secretaries signed out a letter to all the 
Governors in the country when they were here for their retreat 
addressing this exact issue. And therein lies some of the 
issues because they are State and local issues, not so much 
Federal issues.
    That being said, I would actually like to give a shout-out 
to the State of New Mexico, where the Governor there has taken 
this issue by the horns and is addressing it spot on with 
action and goals.
    Senator Murray. With the private sector.
    Secretary Spencer. With the private sector, exactly.
    Senator Murray. Right. I appreciate the on-base jobs, but 
in many of our communities, it's the off-base jobs that count. 
And if they don't want to write that they're a military spouse 
on their resume that is pretty telling. So, all right, we look 
forward to working with all of you on that.

                       GROUND WATER CONTAMINATION

    I also wanted to ask, Secretary Spencer, in my home State 
of Washington, there was a significant amount of groundwater 
contamination as a result of military use of firefighting foam. 
I know you know the issue well. Recently, the Navy agreed to 
install a filtration system for the town of Coupeville to make 
sure they have safe drinking water, but I hear a lot from my 
constituents who are very concerned about their health. This 
committee provided more than 42 million to the Navy for cleanup 
of those chemicals and to make sure there is safe drinking 
water, which is in addition to tens of millions to others, the 
other services, and to OSD (Office of the Secretary of Defense) 
for cleanup and research.
    I just want to really impress on you it is imperative the 
Navy acts quickly and decisively. And can you just tell us what 
your next steps are in addressing this contamination?
    Secretary Spencer. Senator, we've made the statement, and 
we mean it, that the Navy takes its responsibilities, both for 
protection of this country and our responsibilities for the 
environment, very, very seriously. It has to be sustainable for 
us to be impactful going forward.
    I'm aware of the issue that you're talking about. We are a 
neighbor, we remain to be a neighbor, and we're a responsible 
neighbor. We are putting forth the best that we can do with the 
sciences that we know are available now. And I can commit to 
you that that is how we're going to go going forward.
    Senator Murray. Okay. Thank you.
    Mr. Chairman, I have other questions. I will submit them 
for the record. And I appreciate it very much.
    Senator Shelby. Without objection.

                          TECHNOLOGY TRANSFER

    Mr. Secretary, you alluded to our competition with China, 
and I think you're spot on, but it seems to me that there has 
been, say, in the last 30, 35 years, a huge transfer of 
technology, that is, engineering and science, and the ability 
to--and manufacturing and everything that goes with that, from 
the west, especially us, but Europe, too, to China, that in 
modern history no one has ever seen. So they've not only taken 
a few steps, as you've mentioned, big steps, to educate some of 
their best and brightest, having been doing it nearly 40 years, 
100- and maybe 200,000 a year in U.S., and they're going back. 
That's going to--it's already posing a threat to us 
economically. It could pose a threat to us down the road 
militarily, could it not?
    Secretary Spencer. Yes, sir.
    Senator Shelby. And is that one of your concerns, and it 
better be a wakeup call for all of us?
    Secretary Spencer. It is a tremendous concern, Senator, and 
it's not just within the DOD, I think it's in the corporate 
boardrooms around America.
    Senator Shelby. Yes. Well, you referenced buying companies 
and so forth. And of course, we have the CFIUS (Committee on 
Foreign Investment in the United States) issue we're familiar 
with on another life in the Banking Committee, I've worked on 
that.
    I think it's very important for us not to sell things or 
help other companies, foreign companies, control things that we 
deem are important to our national security. Do you agree with 
that?
    Secretary Spencer. I could not agree more, Senator.
    Senator Shelby. Do you agree with that, Admiral?
    Admiral Richardson. I do; yes, sir.
    Senator Shelby. General.
    General Neller. Yes, Senator.
    Senator Shelby. Thank you.
    Senator Baldwin, do you have any other questions?

                      JOINT LIGHT TACTICAL VEHICLE

    Senator Baldwin. Thank you, Mr. Chairman.
    General Neller, you've previously commented that you want 
to field the Joint Light Tactical Vehicle as quickly as 
possible. Bless you. I've also seen reports that the Marine 
Corps may be looking to increase the JLTV acquisition objective 
from 5,500 vehicles to more than 9,000. Given this posture, 
which I support, I'm concerned that the President's last two 
budget requests don't seem to support that same goal. For 
example, the fiscal year 2019 budget request seeks to buy 214 
fewer JLTVs than was anticipated in the fiscal year 2018 
request.
    Similarly, the fiscal year 2018 budget requested only 527 
vehicles when the prior year budget had planned for more than 
1,150. If JLTV procurement gets pushed to the right, the 
program will have to compete for resources with future larger 
scale modernization programs, which would probably put 
increasing--incredible pressure actually on the Marine Corps 
budget.
    General Neller, could you comment and do you think 
restoring 214 JLTVs to your fiscal year 2019 acquisition plans 
would help the Marine Corps fielding schedule stay on track?
    General Neller. Senator, as we discussed before, we want to 
field this vehicle as quick as we can. And the acquisition 
objective originally was 5,500, and somewhere now it's around 
9,000. And so it's a good vehicle. We want to get it. Our 
Humvees are old and need to be replaced. The drawdown or the 
reduction of 214 vehicles in the budgets was based on other 
trades where we just simply put other things at a higher 
priority. The total price of those vehicles is about $60, $65 
million.
    So if that money were restored, obviously, we would want to 
do that. But we had to make some trades on things that we 
thought were of higher priority, like long-range artillery, 
rockets, and things like that, and so that's--that's where we 
ended up. It has nothing to do with us not wanting to field 
that vehicle faster.
    Senator Baldwin. All right. Thank you.
    Thank you, Mr. Chairman.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Shelby. This hearing and subcommittee will 
reconvene on April the 26th at 10:00 a.m. to receive testimony 
on the Defense Health Program. Senators that were not here and 
some that were here may submit additional questions for the 
record, and we would hope you would answer within 30 days of 
receiving them.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
             Questions Submitted to Hon. Richard V. Spencer
            Questions Submitted by Senator Susan M. Collins
    navy unfunded priorities list--shipyard investment acceleration
    Question. The Navy's Unfunded Priorities List includes an 
additional $176 million for ``Shipyard Investment Acceleration'' to 
speed procurement of industrial plant equipment at the public 
shipyards, which is badly needed. How would this additional funding aid 
in the Navy's shipyard modernization efforts and increase productivity 
at the yards even further?
    Answer. The Navy estimates that additional fiscal year 2019 funding 
of $176 million will shorten the capital equipment modernization period 
by 1 year. Attached is a list of Capital Investment Program Other 
Procurement Navy requirements that can be accelerated into fiscal year 
2019. This list reflects priorities documented in Appendix H of the 
Navy's February 2018 Shipyard Infrastructure Optimization Plan and only 
includes out-year projects that are mature enough to accelerate into 
fiscal year 2019. Priorities are based on the formalized evaluation of 
each project including return on investment and improvement to depot 
maintenance throughput.
    [The list follows:]
    
    
    
    
             Question Submitted by Senator Susan M. Collins
                    shipyard apprenticeship programs
    Question. Apprenticeship programs are crucial in helping our 
workforce develop the highly technical skills, including nuclear, to 
sustain our fleet. Portsmouth Naval Shipyard uses the Trades 
Apprenticeship Program and the Worker Skills Progression Program (WSPP) 
to train applicants in various skilled trades. The Shipyard has a 
Memorandum of Understanding with York County Community College and 
Great Bay Community College, providing employees the opportunity to 
earn credits towards associate's degrees at both institutions. I 
understand that these apprenticeship programs are very important to the 
other three public shipyards as well. How can the Navy and Congress 
better support these programs to ensure that we are fully developing 
and supporting our skilled workforce?
    Answer. Development of our workforce is crucial to ensuring we have 
the highly technical skills required to sustain our fleet. Challenges 
and recommendations for addressing the them include:
  --Current hiring process for apprentices takes an average of 6-8 
        months and results in considerable attrition of high quality 
        candidates. Examples for causes of delays include the Advanced 
        Fingerprint Report requirement (Federal Bureau of 
        Investigation), security clearance processing (Office of 
        Personnel Management), under staffing of Naval Health Clinics 
        delaying physical examinations and base access requirements.
    Recommendation: The Navy will work to streamline processes that are 
        under our control. Request congressional support for 
        streamlining hiring processes to allow for expedited 
        recruitment, selection and onboarding of highly qualified 
        candidates while meeting all administrative requirements.
  --Trade jobs and apprenticeships are not widely recognized as a 
        viable post-secondary pathway to meaningful and lucrative 
        careers. Additionally, current efforts at expanding 
        apprenticeships are geared towards the private sector.
    Recommendation: Request congressional support to revitalize skilled 
        trades training in secondary schools (through shop classes and 
        vocational training) so students and parents see trades and 
        apprenticeships as a viable alternative to pursuing college 
        degrees. Request congressional support for funding the 
        expansion of apprenticeship programs in the public sector as 
        well as the private sector.
  --Difficulty in hiring qualified instructors with technical 
        experience to teach trades and other technical topics.
    Recommendation: Request congressional support for modifications to 
        hiring laws to allow direct transition of military journey man 
        level workers and other qualified candidates into shipyard 
        instructor programs to create pathways for military technicians 
        to transition to GS-11 instructor positions.
  --Many of our apprentices are young parents with child care issues.
    Recommendation: Request congressional support to provide funding so 
        that communities have better child care options, including 
        earlier start times, infant care and later closing times.
  --Increase outreach and education promoting science, technology, 
        engineering and math (STEM).
    Recommendation: Request congressional support for Federal grants 
        for STEM programs.
                                 ______
                                 
              Questions Submitted by Senator Brian Schatz
    Question. There is strong support from PACOM and PACFLT for UH's 
application to establish a Navy ROTC program. It makes good sense and 
would let the Navy harness Hawaii's diversity, including the unique 
cultural and language skills these cadets would bring to the fleet. But 
we have heard mixed reasons for why the Navy cannot do this--from a 
lack of funding, to a cap on the number of ROTC units that the Navy is 
allotted at one time.
    Can you please provide me a definitive answer about what the Navy 
would need to support UH's Navy ROTC application?
    Answer. We agree that University of Hawaii has high potential as a 
NROTC unit, and we look forward to working with you on making it a 
reality. Given our program's current excess capacity, it would be 
essential to disestablish some under-performing units to better align 
capacity with the true officer commissioning requirement, and to serve 
as a funding offset for consideration of any new units. Toward that 
end, we would request your assistance with gaining statutory relief 
from the prohibition in recent Department of Defense Appropriations 
Acts against planning for and executing Senior ROTC unit 
disestablishments as a path for establishing a new unit at the 
University of Hawaii.
    Question. Can you explain the role of Navy civilians in achieving 
your readiness recovery goals?
    Answer. Civilians are vital in all areas of readiness recovery. To 
improve the readiness of our ships and align the workforce to the 
projected workload, we are adding nearly 1900 civilian Full-Time 
Equivalents (FTEs) to our Naval Shipyards over fiscal years 2018 and 
2019, continuing our ramp to 36,100 FTEs in the shipyards by fiscal 
year 2020. This increase in the workforce, possessing the right talent, 
will help us to meet scheduled ship maintenance, support additional 
ships, and reduce the backlog that has accumulated from over a decade 
of increased operational tempo. To support naval aviation readiness, 
our 2019 budget request provides funding for an additional 258 
civilians including artisans, engineers and logisticians at our Fleet 
Readiness Centers (FRCs). This growth in the FRC workforce, building 
off past budgets that added funding for civilians will increase the 
throughput of aircraft and components, helping to restore aviation 
readiness by getting more mission capable aircraft back to the 
flightline and fleet sooner where they are needed to support both 
training and operational demands. Training and retaining the new 
workforce is critical to sustaining readiness improvements. It will 
take time--historically 2 to 4 years--for the newly hired personnel to 
develop the skill level necessary to drive the improvement in 
productivity we need to achieve our goals. The Navy is exploring ways 
to train and educate new workers to make them productive more quickly.
    Question. Is there a link between years of directed reductions to 
the Navy civilian workforce and the current state of readiness in the 
Navy?
    Answer. The link between directed reductions and readiness is less 
about the overall numbers of civilian personnel and more about the loss 
of talent and capability. The Department of the Navy maintains an 
integrated workforce comprised of civilians, contractors, Sailors and 
Marines with a mission to protect the American way of life. Skilled 
civilians which include welders, engineers, scientists, information 
technology and acquisition specialists--many with critical 
certifications and advanced degrees--man our shipyards, monitor 
situations across the globe, develop tomorrow's technological 
advancements, and provide cyber support. Congressionally-mandated 
reductions have resulted in highly trained personnel in these critical 
occupations leaving the Department. On top of mandated reductions, 
Government shutdowns and furloughs have discouraged potential employees 
from seeking jobs in the Navy, creating holes in workforce continuity. 
Knowledge and capability gaps increase the time required to get vital 
assets repaired and operational.
    Question. How can the Navy generate readiness for the force while 
facing reductions to its civilian workforce?
    Answer. The Navy continues implementing the 25 percent headquarters 
reduction required by Congress and is committed to achieving a more 
efficient and effective Department. More important than the overall 
size of the workforce however, is the capability and talent that the 
civilian workforce brings to the Navy and to the generation of force 
readiness. The Navy continually reviews its requirements and carefully 
manages its civilian workforce in order to support readiness and 
efficiently and effectively achieve the Navy mission. The Navy will 
continue to recruit superior talent and invest in long-term measures to 
retain it. The fiscal year 2019 budget request funds the civilian work 
force required to support the programmed force structure, meet 
strategic guidance, and build the Navy the Nation Needs. It sustains 
efforts in critical areas such as cyber defense, equipment maintenance, 
logistical services at home and abroad, engineering services and 
research and development at our labs and warfare centers to generate 
technology that results in more capable and lethal equipment and weapon 
systems. Where the Navy civilian workforce is growing amidst 
Congressionally mandated reductions, increases are focused on those 
areas that restore and improve readiness and increase the lethality, 
capability, and capacity of our military force. To accomplish this, the 
budget reflects civilian workforce growth in ship and aircraft 
maintenance to address backlogs, meet scheduled maintenance and 
increase throughput, growth in the warfare centers focused on 
increasing our air, surface and undersea capabilities, and growth in 
base operating support, fleet support, intelligence and cyber.
    In order to recover readiness fully, the Navy must have the ability 
to retain the best while recruiting new talent in an increasingly 
competitive marketplace. The Navy's 2019 budget adds funding for 
civilians in several key areas. To improve the readiness of our ships 
and align the workforce to the workload, we are adding nearly 1900 
civilians (2017-2019) to our public shipyards. To support naval 
aviation readiness, we are adding over 250 artisans, engineers and 
logisticians at our Fleet Readiness Centers to increase aircraft 
throughput and numbers of mission-capable aircraft on the flightline. 
At our warfare centers and labs, we are adding additional personnel to 
support increased air, surface and undersea capabilities, and at our 
installations, we are adding personnel to address security and incident 
response at installations. This additional workforce, armed with the 
right skills and training, is necessary to sustain readiness.
    Question. Would the Navy's capability and lethality be improved if 
you were able to grow the civilian workforce?
    Answer. More important than the overall size of the civilian 
workforce is the talent and capability that the workforce brings to the 
Navy and to the execution of our mission. The Department of the Navy's 
(DON) civilian workforce is essential to DON's mission and is directly 
linked to the success of the Navy and Marine Corps team and the ability 
to operate and fight decisively around the globe. DON civilians operate 
across a broad spectrum of occupations from world-class researchers and 
scientists that develop cutting-edge equipment and weapons, to those 
that provide day-to-day technical, operational and management 
capability to the Department. We are committed to preserving this 
exceptionally capable and vital workforce, while carefully managing it 
in order to ensure a more efficient and effective Department. The 2019 
budget funds the civilian workforce required to support the programmed 
Navy force structure, meet strategic guidance and build the Navy the 
Nation Needs. Modest growth in the civilian workforce in the 2019 
budget is focused on building a more capable and lethal force. At the 
Navy's warfare centers, we are adding nearly 1300 civilian personnel to 
support increased air, surface and undersea capabilities. Much of the 
warfare center growth is focused on engineering and support of expanded 
platforms including; the payload module added to all future VIRGINIA-
Class submarines; communication and weapons systems; enhanced 
electronic warfare capabilities; and nuclear deterrence capabilities. 
We are also adding 58 civilian personnel to accelerate and enhance 
offensive and defensive cyberspace operations. At our installations, we 
are adding 365 civilians to address security and incident response. We 
are adding 190 fleet support personnel in order to expand operations in 
the Pacific including standing up a Littoral Combat Ship squadron, 
growth at the Naval Expeditionary Combat Enterprise and the Fleet 
Maritime Operations Center. And finally, we are adding nearly 1900 
civilians (2017-2019) to our public shipyard workforce and over 250 
artisans, engineers and logisticians at our Fleet Readiness Centers in 
order to reduce backlogs and increasing throughput to get our ships 
back to the fleet on time and mission capable aircraft back to the 
flightline.
                                 ______
                                 
           Questions Submitted to Admiral John M. Richardson
               Questions Submitted by Senator Jon Tester
                          sealift capabilities
    Question. Are we exploring all options to re-capitalize our sealift 
capability and get newer, younger, ships into the Ready Reserve Force?
    Answer. Yes. The Report to Congress, Sealift That The Nation Needs, 
submitted by the Secretary of the Navy on 2 March 2018, reflects a 
three phased approach to the recapitalization of the sealift capacity 
provided by the Ready Reserve Force (RRF). The plan is to extend the 
service life of selected vessels, acquire used vessels from the 
commercial market, and resource and implement a new construction 
program.
    Question. What can be done to get more U.S. built, and U.S. flag 
vessels sailing and into the Maritime Security Program?
    Answer. In coordination with the Maritime Administration, 
considerations have been identified as ways to expand the numbers of 
vessels in the Maritime Security Program (MSP). These considerations 
include: increasing cargo preference requirements to improve the 
competitiveness of U.S.-flag shipping, expand the U.S.-flag share of 
trade through bi-lateral trade agreements, and reduce the costs of 
operating ships under U.S. flag through other tax and regulatory 
initiatives. Navy will continue to support MARAD initiatives to 
strengthen MSP as these ships provide a major source of merchant 
mariners that are utilized to crew surge sealift capability.

                          SUBCOMMITTEE RECESS

    Senator Shelby. This committee is adjourned, recessed.
    [Whereupon, at 11:30 a.m., Tuesday, April 24, the 
subcommittee was recessed, to reconvene at 10:00 a.m., 
Thursday, April 26.]