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Fiscal Year 2003 Defense Budget Testimony – Senate Armed Services Committee (transcript)
As Delivered by Secretary of Defense Donald Rumsfeld, Chairman of Joint Chiefs of Staff Richard Myers, And Dov Zakhe, Before the Senate Armed Services Committee, Tuesday, February 05, 2002


The committee meets this morning to receive testimony from Secretary of Defense Donald Rumsfeld and Chairman of the Joint Chiefs of Staff General Richard Myers on the posture of the United States armed forces and on the president's proposed defense program for fiscal years 2003 to 2007.

We all know General Myers from many, many years, but this is your first opportunity, General, to testify before the committee as chairman of the Joint Chiefs. We give you a special welcome, but we welcome all of our witnesses today on this very important subject.

As we meet today, America's armed forces continue to risk their lives in and around Afghanistan and, of course, in other places around the world. Some have been injured in Afghanistan; others have given their lives. This nation is forever indebted to them and their families for their sacrifice.

Senator [John] Warner and I traveled to the Afghan theater to visit with our forces over Thanksgiving. Other members of the committee have since traveled to the region. And I know that my colleagues join me when I say that these men and women are nothing short of inspiring. They are performing a complex, challenging mission with extraordinary courage, skill and determination. They know their mission and they know that America appreciates and supports them.

The success of our forces has been remarkable. Osama bin Laden, if alive, is on the run and hiding. Many of his al Qaeda terrorists have been captured or killed. The Taliban regime that harbored them is no more. The Afghan people have been liberated from tyranny. And the interim government is in place in Kabul. And nations around the world have been put on notice: America is determined to protect itself from more attacks and to bring terrorists to justice.

The excellence behind that success wasn't built in months. Success of our forces in Afghanistan is a tribute to the recruitment, training and investments over many, many years. And it is a tribute to the leadership of the two witnesses that we have here today.

Secretary Rumsfeld, General Myers, the country is grateful for your leadership of our armed forces during this dangerous time for our nation.

This committee will look carefully at the conduct of the operations in Afghanistan as we work with the Defense Department to shape our forces for the future. On Thursday the committee will receive testimony from the commander of Operation Enduring Freedom, General Tommy Franks, in both open and closed session.

One of the lessons of this operation is that we enhance our security when we make common cause with other nations in pursuit of common goals. The path to a safer world and a more secure America rarely comes from a go-it-alone approach, but rather from working with allies, partners and other nations and from remaining engaged in critical regions of the world.

Future success on the battlefield will also depend on success in managing the Defense Department and on preparing our military for tomorrow's missions. The Department's budget request provides important funding for the war against terrorism and to improve the quality of life for our forces and their families by increasing pay and benefits -- especially health care. It includes funding for increased purchases of precision munitions and for unmanned aircraft, which proved so critical to the success of our military operations in Afghanistan. The administration is proposing the largest increase in military spending in two decades.

I do want to point out that this proposed increase comes without a comprehensive strategy or a detailed plan to guide that spending. The administration has not yet issued a national security strategy or a national military strategy, or detailed plans for the size, structure, shape, or transformation of our military.

We all appreciate the pressures on the department while it conducts a war. At the same time, I trust that Secretary Rumsfeld agrees that an overall strategy and clear plans are essential if we're to make wise decisions on the future of our armed forces.

We also continue to await a report on the steps that the department plans to take to ensure that taxpayers' money is spent wisely. The administration is requesting $48 billion above the fiscal year 2002 level. In his last testimony before this committee, seven months ago, Secretary Rumsfeld candidly stated that, quote, "I've never seen an organization that couldn't operate at something like 5 percent more efficiency if it had the freedom to do so," close quote. And he went on to say that the taxpayers have a right to demand that we spend their money wisely and further said that he could not tell the American people that we are doing that.

The committee will be interested to hear how much progress has been made on this front. I know that the secretary is active on many, many fronts indeed. Waging a war is number one, and some of these other needs and considerations have to be delayed. But I know as soon as the secretary is able to address these issues, that he is going to do so, while carrying on the other more pressing and more comprehensive responsibilities.

Finally, we look forward to the department's plan for carrying out what the Quadrennial Defense Review called the military's highest priority: homeland security. A new combatant command will apparently coordinate the department's role in homeland security. Congress awaits the decision on how the Pentagon intends to organize itself to oversee this mission. General Myers testified at his confirmation hearing in September that this whole issue of homeland defense or homeland security needs a lot more thought, in his words. The committee looks forward to specifics which Secretary Rumsfeld and General Myers could share with us this morning on that important mission.

America's armed forces are performing admirably in their fight against al Qaeda. This committee will do all in its power, as it has done down the years, to ensure that our forces have the resources, the tools, the technology, whatever they need, to prevail in that fight. We're determined to preserve a high quality of life for our forces, for their families, to sustain readiness, to transform the armed forces to meet the threats and challenges of tomorrow.

My partner, Secretary -- Secretary? -- Senator Warner.

SEN. JOHN WARNER (R-VA): Years ago. I'm proud of it.

Mr. Chairman, that was an excellent opening statement, and it parallels in large measure the statement that I was going to deliver. And therefore, to save time, I'll ask to put mine in the record, and just make a few heartfelt remarks of my own.

First, Mr. Secretary, we're privileged to have with us this morning your lovely wife. And I know she didn't wish to be singled out, but she does exemplify the spouses who stand behind the men and women of the armed forces and indeed those in the civilian service throughout the department. It's been a tremendous and arduous task for all of you here, particularly since 11 September. And I wish to commend her and all in like positions.

Mr. Secretary, as you and I reflected the other day, we go back a few years together and have seen quite a few incidents in this country, but I think in my judgment, never before has this nation been more strongly united behind its president and, most particularly, those who proudly wear the uniform, General Myers, of our nation. Since World War II, when this nation was united like never before in its history but has come back together again, in large measure that's because of the leadership of the president and yourself, Mr. Secretary, and General Myers, those in uniform under your supervision.

So this country's going to move forward and carry out, both here at home and abroad, the orders of the president to do everything we can to eliminate, not only for the United States but indeed the whole world, the threat posed by terrorism. And as you have pointed out -- and I wish to commend you Mr. Secretary, in the manner in which you have made yourself available to the nation's public, largely through the press and your visits, both abroad to the troops and here at home to military installations -- no matter how much we read and observe on television, your own means to communicate frankly, honestly and bluntly, and with a sense of humor here and there, that's terribly important, because those of us that remember Vietnam recall that the home front, for reasons, some very valid, were just not unified behind the men and women, and it was exceedingly difficult for those in uniform to carry out their missions.

The chairman mentioned the budget. We shall deal with that. We talked yesterday at lunch with you about that in some detail. It is the largest but it is, as I said yesterday -- if we're going to preserve our democracy, we have no choice as a nation but to move forward and back our president.

I frankly think, Mr. Secretary, you're going to see strong bipartisan support for this budget. We've got to make certain that as you have allocated with your colleague Tom Ridge the responsibilities of homeland defense, that those budget items are properly allocated between the two accounts. As you told us yesterday at lunch, you have worked together as partners, together with the director of the Central Intelligence Agency, in putting this budget together, because it is very significance in size.

And we also have the item of some 10 billion (dollars) in here, which I think is a wise, wise insertion in to the budget, without the specifics, because it gives the president and yourself the flexibility to move expeditiously if new challenges, new threats face our nation.

Congress has its oversight. We will have oversight on that. As I said yesterday, I think we'll have to fine-tune some means by which Congress reviews perhaps contemporaneously how you're going to make those particular expenditures in that budget item.

Also, I go back to a quote by our president. It was in September of 1999, and he said this at The Citadel: "We must as a nation renew the bond of trust between the American people and the American military, defend the American people against missiles and terror and begin creating the military of the next century." In my judgment, the budget request before us carries out that commitment he made to this nation well before September the 11th. It shows how he was looking into the future and making the plans for what none of us at that time or even now can fully comprehend the type of threat that struck this nation on 11 September.

But I again commend the president for his leadership. Yes, his polls are strong now, but that's really situations that change. But what won't change -- and he has repeatedly told this Congress -- is his strong commitment to carry forward this mission and deter terrorism against this country. There is no timetable, and both of you have repeatedly reminded the people of that, and I think they're prepared to accept that as we move forward.

Lastly, Mr. Secretary, as I look at this budget, and as I look at the military budgets worldwide and particularly those of our valued allies in NATO, they simply are not moving apace with their expenditures, calling on their citizens to reach into their pockets and provide for their respective armed forces in the same way that our president and, I think, this Congress will call on the citizens of this country.

I'm not sure what the solution is to that, but you and I and others have a burden to explain to the American people: Yes, we are the world leader, but terrorism is common to all of us, and therefore there should be a greater sharing of the financial burdens and the hardships as we move forward in this unified battle against terrorism. And I hope that you will touch on that in your comments to this committee.

With that, I conclude my brief remarks, and also saying that I strongly support the concept that we need a CINC for homeland defense, General. I'm not sure just how and when you'll go about formalizing that. You have the authority under existing law, but it may be well advised to involve the Congress, because in my consultation with the governors, they want to fully support our president on homeland defense, but their concern is exactly how these funds, considerable sums, are to be expended, and also the relationship between their Guard and the active forces that will be augmented to bring about this homeland defense command, the CINC for America, referred to now as CINCNORTH. And I think the greater involvement in Congress is going to strengthen and also, frankly, showcase the importance of how the president and yourselves are moving out, defend us here at home.

He mentioned in his Citadel -- his Citadel speech back there in September '99 the need to strengthen homeland defense, again showing our president's wisdom in looking into future and to the threats.

Good luck, and my very best to the men and women of the armed forces under your command.

SEN. LEVIN: Thank you, Senator Warner.

There's going to be a vote at 10:30. What my plan is, is that we will continue the hearing right through that vote, and hopefully enough of us can vote early, so that they can get back in time to pick up. After the opening statements of Secretary Rumsfeld and General Myers, there will be a first round of six minutes for each senator on the basis of the early bird rule.

Again, we give you a very warm welcome, Secretary Rumsfeld, to you, General Myers. And also, Dr. Zakheim, the comptroller of the Department of Defense, we welcome you here this morning.

Secretary Rumsfeld.

SEC. RUMSFELD: Thank you very much, Mr. Chairman and members of the committee. I certainly want to join the chairman and Senator Warner in expressing our appreciation to the men and women in the armed forces.

They are, as you said, doing an absolutely superb job. You can't travel anywhere in the world or in this country and visit with them and not come away with a great deal of energy and pride and confidence.

I also want to say that from the first day on September 11th, when you and Senator Warner arrived at the Pentagon, we recognized the very strong bipartisan support that this committee has given the Department of Defense. We recognize it, we appreciate it, we value it, and thank you.

I have submitted a fairly lengthy statement for the record, which I won't go through. I have some other remarks that I would like to deliver at this point.

SEN. LEVIN: Of course your entire statement will be made part of the record.

SEC. RUMSFELD: Thank you, sir.

The events of September 11th shattered many myths, among them the illusion that the post-Cold War world would be one of extended peace, where America could stand down, cut defense spending and focus our resources and attention on domestic and personal priorities. We learned on September 11th that that really is not the case. When the Cold War ended, a defense drawdown took place that went too far. It, in my view, overshot the mark. Many on this committee of both parties fought an uphill battle to provide the resources the department needed. With the benefit of 20-20 hindsight, the reality is that our county spent much of the 1990s living off the investments of the 1980s that the American people invested during the Cold War.

Now, through the prism of September 11th, we can see that our challenge today is not simply to fix the underfunding of the past, but it's to accomplish several difficult missions at once. One is to win the worldwide war on terror. Second is to restore the capabilities by making delayed investments in procurement, people and modernization. And third is to prepare for the the future by transforming the defense establishment to fit the 21st century.

There are some who say this may be too much to ask, that any one of these challenges is daunting, but the idea of tackling them all at once isn't a good idea. I disagree. I think we can do it and I think we must do it. Our adversaries are watching what we do. They're studying how we have been successfully attacked, how we are responding and how we may be vulnerable in the future. And we stand still at our peril.

For these reasons, President Bush has sent to Congress a 2003 defense budget request of $379 billion, a $48 billion increase from the 2002 budget. It includes $19.4 billion for the war on terrorism, a $10 billion contingency fund, but $9.4 billion for a variety of programs related to the war, a good portion of which goes to force protection here in the United States, which is at a totally different level than it had previously been.

It's a great deal of money, hard-earned tax dollars, but let me try to put it in context. Last year before this committee, I said that a decade of overuse and underfunding had left us in a hole sufficiently deep that the president's 2002 budget, which also had a significant increase, still left shortfalls in a number of critical areas, including infrastructure, procurement, operations and maintenance.

Moreover, I advise this committee that just to keep the Department going in 2003 on a straight-line basis with no improvements, simply covering the cost of inflation and realistic budgeting, we estimated that DOD would require a budget of $347 billion, or an $18.3 billion increase over 2002. Well, as high as it may have sounded then, it turned out that that estimate was a bit low. If you combine the cost of inflation plus the military health care, retirement benefits and pay increase plus realistic estimates for weapon costs, readiness and depot maintenance, the correct figure, just to have a straight line over 2002 is 300 -- $359.4 billion. When one adds that to the 19.4 billion (dollars) in this budget for the war on terrorism, the total comes to 378 billion (dollars) out of a request of 379 billion (dollars).

That's a significant investment. We are investing it differently. We're accelerating programs we consider transformational, and we've made program adjustments to achieve something in the neighborhood of $9.3 billion in proposed savings and adjustments to be used for transformation and other pressing requirements. At the same time, we're fully funding those areas that we must in order to continue trying to reverse years of underinvestment in people, readiness and modernization. The 2003 budget request before you was guided by the result of last year's Defense Strategy Review.

You know, given the questions that some people posed last year, I must say that it's really quite remarkable what the people in the Department of Defense have accomplished. In one year, 2001, the Department has developed and adopted a new defense strategy, replaced the decade-old, two-major-theater war construct for sizing our forces with a new approach much more appropriate to the 21st century. We've adopted a new approach for balancing risk -- war risk as opposed to people risk, balanced against modernization risk, the risk of not modernizing sufficiently and against the risks of not transforming -- it's not an easy thing to do, because we're comparing apples and oranges, but the Department has worked mightily to try to do a much better job of that than has been the case in the past -- reorganized and revitalized the missile-defense research and testing program.

We've reorganized the Department to better focus on space capabilities. Because of the nuclear posture review mandated by Congress, we've adopted a new approach to strategic deterrence that increases our security while allowing deep reductions in strategic nuclear weapons. And as you pointed out, Mr. Chairman and Senator

Warner, within a week or so, we'll present to the present a new unified command structure.

And all this was done where we had about half of our people during the first half of the year, and we had a war on terrorism since September 11th. I would say that that's not bad for a defense establishment -- military and civilian, public and private, executive and legislative -- that has a reputation for being impossibly resistant to change. I think that's quite a year. When I look back on that challenging year, I feel we've made good progress, thanks to the superb work of the men and women in the Department who put forth an enormous effort.

In the course of defense reviews, we identified six key transformational goals around which we'll focus our defense strategy. They are: first, to protect the homeland and forces overseas; second, to project and sustain power in distant theaters; third, to deny enemy sanctuary; fourth, to protect information networks from attack; fifth, to use information technology to link up U.S. forces so that they can truly fight jointly; and sixth, to maintain unhindered access to space to protect U.S. space capabilities from enemy attack. The president's 2003 budget requests advances in each of these six transformational goals.

With respect to protecting bases of operation and homeland defense: The president's budget funds a number of programs, including a refocused research and development testing program and the development of biological defenses.

It requests about $8 billion for programs to support defense of the homeland, $45 billion over the five-year, future-year defense plan, which is an increase of about 47 percent.

The second, denying enemy sanctuary, requests 3.2 billion (dollars) for programs to support these objectives and 16.9 billion (dollars) over the five years, an increase of 157 percent.

Projecting power in denied areas: Today, in many cases, U.S. forces depend on vulnerable foreign bases to operate, creating incentives for adversaries to develop access-denial capabilities to keep us out. The 2003 budget requests 7.4 billion (dollars) for programs to help ensure the ability to project power over long distances and 53 billion (dollars) over the five-year period, an increase of 21 percent.

Leveraging information technology: A key transformational goal is to leverage advances in information to seamlessly conduct -- connect U.S. forces in the air, on the sea and on the ground. The president's budget requests 2.5 billion (dollars) for programs that support this objective, or 18.6 billion (dollars) over the five years, an increase of 125 percent.

Conducting effective information operations: As information warfare takes an increasingly significant role in modern war, our ability to protect our networks and to attack and cripple those of an adversary will be critical. The president's 2003 budget requests 174 million (dollars) for programs to support this objective and 773 million (dollars) over the five-year period, an increase of 28 percent.

And last, strengthening space operations: From the dawn of time, the key has been -- to victory on the battlefield has been to control the high ground. Space is, indeed, the ultimate high ground. The president's 2003 budget requests about 200 million (dollars) to strengthen space capabilities and 1.5 billion (dollars) over the five- year period, an increase of 145 percent.

Of course, we cannot transform the military in one year or even in a decade -- nor would it be wise to do so. Rather, we intend to transform some relatively modest percentage of the force, turning it into the leading edge of change that will, over time, lead the rest of the force into the 21st century. Moreover, investments in transformation cannot be measured in numbers alone. Transformation is not about weapon systems particularly; it's -- it's more about thinking -- changing how we think about war. All the high-tech weapons in the world won't transform our armed forces unless we transform the way we think, the way we train, the way we exercise and the way we fight.

Modernization, procurement and readiness: As we've transformed from the threats we face, we also have to prepare our forces for conflicts that we may have to fight during this decade by improving readiness and increasing procurement and selective modernization. To deal with the backlog that resulted from the procurement holiday of the last decade, we've requested some $68.7 billion for procurement in the 2003 budget. That's an increase of about 10 percent over 2002. And procurement is projected to grow steadily over the five-year defense program, to more than 98 billion (dollars) in 2007. And it will increasingly fund transformation programs over the period of time.

We've requested 150 billion (dollars) for operations and maintenance accounts in '03, including substantial funding for the so- called readiness accounts of tank miles, steaming days and flying hours for the services.

If we're to win the war on terror and prepare for tomorrow, we have to take care of the Department's greatest asset: the men and women in uniform. We're competing with the private sector for the best young people our nation offers. And we can't simply count on their patriotism and willingness to sacrifice alone to attack them -- attract them. That's why the president's 2003 budget requests some $94 billion for military pay and allowances, including a $1.9 billion across-the-board, 4.1-percent pay increase and $300 million for targeted pay raises for the mid grade, particularly NCOs; $4.2 billion to improve military housing, putting the Department on track to eliminate most substandard housing by 2007; funds to lower out-of- pocket housing costs for those living off base, from 11.3 percent to 7.5 percent in 2003, putting us on the track to eliminate out-of- pocket housing costs for the men and women in uniform by 2005; and 10 billion (dollars) for education, training and recruitment, as well as a breathtaking $18.8 billion to cover the realistic cost of military health care.

Smart weapons are worthless, unless they are in the hands of smart, well-trained, highly-motivated soldiers, sailors, airmen and marines.

While this budget includes proposed increases in a number of areas, it also includes a number of savings. We are committed to pursuing what works, and stopping what does not. For example, we terminated the Navy's area missile defense program, because of delays, poor performance and cost overruns. We are proceeding towards a goal of a 15 percent average reduction in headquarters staff. And the Senior Executive Council of the department is seeking additional ways to ensure that we manage the department more efficiently.

We need to save more, but two things make it difficult. First was the decision not to make deep cuts in manpower. Now in the midst of a war on terror, whose final dimension is still unknown, we do not believe it is the time to be cutting manpower, to say nothing of the fact that we now have some 60,000 Guard and Reserve that have been called up, and another 10,000 who have been held in the service, for a total of 70,000 additional manpower. It's interesting to note that the largest theater for the United States is not Afghanistan today. It is in fact Salt Lake City and the environs, where we have people there for the Olympics. We literally have more people in the area around Salt Lake City for the Olympics than we do in Afghanistan.

Second, Congress's decision to put off base closures for a couple of years means that the department will have to continue supporting between 20 and 25 percent more infrastructure than we believe is needed for the force. And I know this committee was forceful in urging base closing, and we appreciate that. It is a fact, however, that with a two-year delay we have to continue providing force protection for the bases, even though we believe a substantial number of the bases -- something in the neighborhood of 20 to 22, or 23 percent -- are not currently needed.

I have another concern, Mr. Chairman, and it's a hard thing to specify, because no one of the earmarks is critical. Each one looks reasonable. But one looks at the changes made -- some 200 -- 2,022 individual programs and line items -- the effect of it overall means that a fairly substantial portion of the budget that we proposed last year was changed. I think it's something like 13 percent of all research, development, tests and evaluation programs, some 995 changes; 8.6 percent of all the procurement programs; and 436 individual changes; and 15 percent of all military construction, or 146 changes. Now, Congress clearly has the constitutional right to do that -- there is no question about that. And any one of these individual earmarks when looked at seems very reasonable. I do think, however, it's important for all of us to step back and look at them in the aggregate and ask what the effect of that is year after year, and if that is really the way we feel it is best to conduct our business.

After counting the cost of keeping the department moving on a straight line, the cost of the war and the savings generated, we are left with about $9.8 billion -- so-called free money -- to invest in transformational activities. It's a lot of money. But it requires us to make a lot of difficult trade-offs. And just to get it up on the table before we start, we were not able to meet our objective of lowering the average age of tactical aircraft. We are investing in unmanned aircraft, the F-22 and the Joint Strike Fighter, which require significant up-front investments, that will be coming on the line in future years. But in the current year the average age of aircraft will not be declining as we had hoped.

Second, while the budget funds faster growth in science and technology, we were not able to meet our goal of three percent of the overall budget, though we are slightly higher than the president's request from 2002.

And third, and most importantly, we clearly were not able to fund ship-building at replacement rates in 2003, and we must do that in the future. As with every department, the Department of the Navy had to make choices, and I know they will be up here next week to discuss the choices they made, where they decided to place more money in O&M and other accounts than in ship-building.

The fiscal '03 ship-building budget is 8.6 billion (dollars). It procures five ships. This is for several reasons. First, there are a number of problems, including contractor problems; but also past ship- building cost estimates were off, and they needed to be funding. So this year's ship-building budget is funding some of the cost increases that were not budgeted from prior years.

Second, the Navy made a calculation that in the short term we can maintain the desired Navy force level at the proposed procurement rate, because of the relatively young age of the fleet. A lot of the ships were purchased during the 1980s, and the average age of the Navy, I am told, is at or slightly better than the average age that is expected and targeted. It is more -- they felt it was more important now to deal with significant needs that had been underfunded in recent years, such as shortfalls in the munitions, spare parts and steaming hours, which are fully funded in this budget. Further, we are investing significant sums in SSGN conversions, which do not count in ship numbers, because while they give us new capabilities, they don't buy new ships as such. The Navy's four-year defense plan budgets five ships in 2004, seven in 2005, seven in 2006, and 10 in 2007.

Finally, the $379 billion that we are talking about here is a great deal of money. But if you consider that New York City's Comptroller's Office has estimated that the local economic cost of the September 11th attack in New York City alone will add up to about $100 billion, estimates of the cost to the national economy ranged about $170 billion last year, and estimates range as high as almost $250 billion a year in lost productivity, sales, jobs, airlines revenues, advertising and the like. And that is not to mention the loss in human lives, and the pain and suffering of so many thousands of Americans who lost husbands and wives, and fathers and mothers and son and daughters and sisters and brothers on that day.

The president's proposed defense budget amounts to about 3.3 percent of our gross domestic product. When I came to Washington in 1957, in the '60s, in the Eisenhower and Kennedy era, we were spending about 10 percent of our gross national product on defense. Today is it about 3.3 percent in this budget proposal. In those days we were spending over 50 percent of the federal budget on defense. Today this budget proposes that we spend I believe 16.9 percent of our federal budget on defense. I point that out because there's been a mistake repeated throughout history that free nations tend to recognize the need to invest in their armed forces after a crisis has already arrived. In 1950, it's interesting, just five years after the Allied victory in World War II, General Omar Bradley urged President Truman to spend about $18 billion on defense. The chiefs gave an even higher estimate to the Congress -- they said $23 billion. And the services estimate was still higher -- their original request $30 billion. The president concluded that the country couldn't afford anything more than $15 billion. The fact was that six months later we were at war in Korea. And just as suddenly we found that we could in fact afford not just $18 billion, but $48 billion was just fine -- a 300 percent increase because the war was on. We need to work together to see that our country makes the investments to deter war, not just to win wars. And let's do so with our experience of September 11th in mind, and with a renewed commitment to ensure that once the fires burn out, the war ends, and the nation rebuilds, that we won't forget the lessons learned at the cost of so many innocent lives. We won't go back to the old ways of doing things. Thank you, Mr. Chairman.

SEN. LEVIN: Thank you, Secretary Rumsfeld. General Myers.

GEN. MYERS: Well, Mr. Chairman, Senator Warner, other distinguished members of the committee, thank you very much for the opportunity to appear before you today. It is very much an honor to report on the state of our nation's armed forces.

We are a military force and a nation at war, and as the secretary said, the attacks of September 11th shattered the prism through which we all looked at the world. In a span of a few minutes, we confronted the historic reality that adversaries can strike at us anywhere in the world, even inside our own borders.

When President Bush came to the Pentagon the following days, the assembled troops told him, "We are ready, Mr. President," and they spoke for themselves and all the men and women of our services. And as we found, they were right.

Take the crew of the U.S.S. Enterprise, on their way home from a six-month deployment, when they learned of the attacks. Each man and woman felt the shudder as the rudder came hard over, and they increased the flank speed and came to a new heading to arrive off the Pakistani coast the next morning. Or take the young Marines of the 15th MEU aboard the U.S.S. Peleliu off the coast of Australia, as they began cleaning their weapons knowing that they could in short time be fired in combat.

Our bomber crews in receipt of alert orders began planning their strike missions a few days later, and our Army Rangers and Green Berets began to collect the detailed intelligence, as they received their orders to go fight in a place called Afghanistan. Yes, and they were all ready -- ready to defend our freedom, and to strike back against our nation's enemies.

Fighting together as a joint team they've achieved much in the first phase of this global war against international terrorism. Like many of you, I visited some of them, and I saw them working hard on the front lines, getting the mission done regardless of the formidable obstacles that they had to overcome. I saw them proudly wearing their country's flag on the sleeves of their desert BDUs and on their flight suits, and I saw in their eyes strength, courage and commitment. And I knew these young Americans would get the job done.

As I talked with them, one message came through loud and clear: this is truly a total force effort. Unless you ask, you don't know whether you are talking to someone from the reserve or active component. Many of our reservists and guardsmen didn't wait to be called up -- they volunteered. I heard about one Navy reservist who sold his business so he could serve without distraction. I think you'll agree that these American heroes are unmatched in the world, and we have every reason to be proud of them.

When I was a young fighter pilot, I never imagined that some day we would have to fly combat air patrols over Detroit, New York, and many other locations here at home. That, along with other defensive actions, is exactly what we have done in the five months since this war began. These actions on the homefront are called Operation Noble Eagle, and they include more than 13,000 combat air patrol sorties over the United States, flown by the National Guard, Reserves, active and NATO air crews. The Air Force alone, the U.S. Air Force alone has committed 260 planes and 1,200 airmen, flying almost 57,000 hours from 29 different bases. We have also established a homeland security joint task force to provide the command and control of our homeland security task. And, as you know, we are helping our busy Coast Guard by augmenting port security. We also have 7,200 National Guard troops at 444 airports, and we are protecting many critical infrastructure sites.

Our overseas offensive actions have included air, land and maritime operations, with three primary objectives: to disrupt and destroy global terrorist organizations, to eliminate safe havens for terrorists, and to prevent access to weapons of mass destruction by terrorist groups.

You know, Tommy Franks and his entire team have done a tremendous job in Afghanistan with Operation Enduring Freedom. And the results so far speak for themselves. Working closely with our coalition partners and Afghan opposition forces, we drove the Taliban from power, and severely degraded the al Qaeda network. The plan worked, and it continues to work. The Taliban were forced to surrender all major cities to opposition forces, and a number of Taliban and al Qaeda leadership personnel were either killed or captured. We destroyed their training camps and center, and their command and control sites. And for the first time we combined humanitarian operations with combat operations, as we airdropped rations, medical supplies and shelters, thus helping avert a humanitarian disaster of potentially extraordinary proportions. Our efforts have helped the Afghan people reclaim their lives.

These results have been achieved with about 60,000 deployed troops in the central command area, and about 4,000 on the ground in Afghanistan. Our success has been enabled by the following key factors: clear and well-established national security goals; the overwhelming support of the American people; outstanding leadership from the president and the secretary of Defense; great support from Congress and close interagency coordination; by patience in formulating our response to the attacks; by great support from our coalition partners and the anti-Taliban forces; by a good plan from central command that was well executed; by superb assistance from the services in supporting unified commands, particularly transformation command; and by flexibility and adaptability at the tactical level; but ultimately our great soldiers, sailors, airmen, Marines, and Coast Guardsman who have made it all happen.

But there remains much to do. And even as we continue the long- term effort to win this global war, we must also sustain other global commitments, such as Operations Northern Watch and Southern Watch, and other responsibilities in the Persian Gulf, the Balkans peacekeeping mission, and the defense of the Korean Peninsula. To fulfill our range of commitments and protect our global interests, we must make the investments necessary to maintain the quality of our force, while preparing for future challenges of the 21st

The best means of accomplishing these goals are to: one, improve our joint war-fighting capability, and two, to transform the armed forces into a 21st century force. With the help of Congress, we've come a long way in recent years toward improving our joint war-fighting capabilities. Serving the operations in Afghanistan are proof of our progress, but there is much more to be done.

To illustrate, let's consider the issue of interoperability. In recent years, we've gotten pretty good at making sure that our Legacy systems work well together. For example, we took a Cold War anti- submarine platform, the Navy's venerable P-3, put some different data links on it and some sensors, and used it in support of ground units to hunt for Taliban and al Qaeda in Afghanistan.

We also flew these P-3s in tandem with Air Force AC-130 gunships and the Joint STARS, the Marine Corps attack helicopters. That they all worked together is a tribute to the ingenuity of all the people involved. But we need to make sure that new systems are conceived, designed and produced with joint war-fighting requirements in mind.

To do that, we need to change our thinking, to look at new systems as interchangeable modules that can plug and play in any situation and in any command arrangement. We've put a lot of effort into our ability on the tactical level, like the modifications of the P-3 that I just described, but we must also concentrate on the operational level of warfare, where organizational and process improvements are just as important.

The area with the greatest potential payoff, I believe, and the current focus of our efforts, is in command, control, communications, computers, intelligence, surveillance and reconnaissance, or C4ISR for short. By improving our C4ISR, we can ensure our commanders have the best information available for rapid battlefield decision-making.

We've made progress in recent years, but stovepipes continue to cause gaps and seams between our combatant commands and the forces that are provided by the services. These gaps and seams must be eliminated. Close collaboration across the services, combatant commands and with other government departments is key to success in achieving our national security objectives.

Additionally, we're developing a command-and-control architecture in our unified commands that will lead to an improved ability to accept and employ forces. We call this architecture the Standing

Joint Force Headquarters. This headquarters will provide the combatant commanders the ability to employ an agile and lethal force using the integrated C4ISR network that I described earlier and further enhancing our joint war-fighting capabilities.

The second key to maintaining quality of our force and preparing for the future challenges is transformation. The secretary has already laid out for you our transformational goals for this 21st century. But I would like to follow through with a couple of points.

First, for me, transformation is simply fostering changes that result in a dramatic improvement over time in the way a combatant commander wages war. I'm convinced that our force structure requires better flexibility and adaptability to achieve our national security objectives in this new international security environment.

Such dramatic improvement requires not only technological change but also changes, and probably most importantly, in how we think and how we employ our capabilities to achieve more effective results in less time with fewer lives lost and with less cost. True transformation must include training and education, as the secretary said, changes in our doctrine and in our organizations.

The second point on transformation is that while sudden technical, organizational or doctrinal breakthroughs are possible and should be vigorously pursued, it's important to note that transformation often results from an accumulation of incremental improvements.

Let me give you an example. When I was flying F-4s in Vietnam, we lost a lot of airplanes to pilots trying to destroy single targets like bridges and anti-aircraft sites. We had to put a lot of people in harm's way to get the job done because our weapon systems weren't very accurate.

So we developed laser-guided bombs and found a way to steer them to the target. Nevertheless, we still had to have relatively good weather because you had to see the target to be able to put the laser- guided bomb on the target. Now, we still needed to put the aircraft in harm's way to keep the bombs on target, but we had achieved, I think, a significant improvement in bombing accuracy.

Now let's think about where we are today. We've got bombs that are impervious to the weather conditions, that steer themselves using satellite-generated global-position-system signals. Let me also point out that when the global positioning system was being developed and first deployed, no one was talking about using it for bombing. It was seen as a better navigational tool.

So essentially we've linked incremental improvements in several different technologies to achieve today our precision strike capability, with accuracy that I believe amounts to truly transformational change. But this transformation is not just about more accurate bombs. The real transformation is in the target set, where we have advanced from needing multiple sorties to strike one target to using one sortie to strike multiple targets.

There's also been a transformation in our thinking. Bombs are no longer regarded as solely area weapons. Instead they can be used like bullets from a rifle, aimed precisely and individually. The foundation of that breakthrough, laid over 30 years ago in Vietnam, was tactical innovation in the midst of war. And on that foundation we've built successive improvements to get where we are today. And, of course, we're laying that same foundation for future breakthroughs in the midst of today's war.

For example, the army of unmanned vehicles is a tactical innovation that we're just beginning to explore. We can't accurately foresee the future for sure, but I'm confident we're working on other capabilities that, when you couple them with the improvements of armed, unmanned vehicles, have the potential to change significantly the way we fight and perhaps even the nature of warfare itself. That and similar possibilities is why I believe the service recapitalization and modernization programs are so important to transformation.

Members of the committee, I'm pleased to say that our forces remain the most powerful and the best-trained in the world. Their excellence is due in no small part to your unwavering support of our troops. We've made tremendous strides in recent years, providing our people a comprehensive set of quality-of-life improvements, especially in the areas of pay and housing and health care. The quality of life also includes adequate training, modern equipment, modern infrastructure and adequate spare parts.

I ask that we continue to keep faith with both our active and reserve component members, as well as our retirees. Sustaining the quality of life of our people is crucial to recruiting, crucial to retention, and especially crucial to our readiness to fight.

But more important, it's the right thing to do for our heroes who, this very minute, are serving in harm's way, defending our freedom. They're the practitioners of joint war-fighting and the creators of transformation. They make things happen and should always be our top priority.

The men and women of your armed forces are committed to achieving victory, no matter how long it takes or no matter where it takes us. And they're counting on all of us to provide them the tools they need for success today and tomorrow. They certainly deserve our best effort.

Mr. Chairman, I welcome the opportunity to work with you and the committee as we continue to fight against global terrorism, and I thank you again for the opportunity to be here with you today, and I look forward to taking your questions.

SEN. LEVIN: General Myers, thank you for that powerful statement. And thank you both. The vote is scheduled to begin just about now, and again, we'll try to keep the hearing going right through the vote; some of us leaving early, coming back in time to pick up.

Secretary Rumsfeld, the 2003 budget request contains a contingency request for $10 billion. It is stated to fight the war on terrorism; stated very generally. Other than the extraordinary circumstances that prevailed immediately after September 11th last year, Congress has generally not appropriated money in advance for unspecified military activities or contingency operations.

My question is this: As requested, could those funds be used for any activities that the president or you decided to use them for? For instance, initiating military operations against any of the three countries specifically identified as terrorist states in the president's State of the Union message as states which threaten us. Could that $10 billion be used to initiate those military operations without further authorization or action of the Congress?

SEC. RUMSFELD: Mr. Chairman, the $10 billion contingency fund, as proposed by the president, clearly would not be spent if the United States were not engaged in the war on terrorism at the early part of 2003. Also, it's clear that it would have to be more in the event that we were engaged in it, because the amount of money that is included in the contingency, namely $10 billion, would only provide the current level of effort into the early months of 2003. It would not carry us through the year.

That being the case, if one assumed that we're in roughly the same circumstance we are today, still tracking down al Qaeda and Taliban pockets of resistance in Afghanistan and engaged in the kinds of activities we are at the present time elsewhere in the world, the dollars would be roughly what we're currently spending; I think it's about $1.8 billion or $1.9 billion a month.

So it would carry us through three or four or five months. And if you disaggregate what the cost of the war is, a good fraction of it, something less than 50 percent, but as I recall, something over 30 percent, is in the homeland defense category for the combat air patrols we're flying and for the assistance on the borders and assistance in the airports and the host of things, Olympics, Super Bowl support and the like.

My understanding is that the funds would be used for the war on terrorism that the president has announced. He's indicated that al Qaeda is in some 60 countries and that the task has to be to root out those terrorists. And I must say, I don't know that the -- I don't think there's anything in the budget that contemplates -- it is such a relatively small amount of money, given the current demands on us, that contemplates anything of the size that you're talking about.

SEN. LEVIN: General Myers, there's some confusion as to exactly what our forces will be doing in the Philippines. And I'd like you to address that issue. The Philippine army units are going out on patrol to find and capture or destroy terrorist elements in the Philippines. One of our commanders there has said that our forces will be going into dangerous places.

Can you tell us what the mission is of the forces which are being deployed to the Philippines? And will they be involved -- is it likely that they would be involved in what would normally be considered combat operations, along with those patrols seeking out those terrorist groups?

GEN. MYERS: Well, Mr. Chairman, I'd be glad to. And I know there's been some confusion over the role that -- what we call Joint Task Force 510 will play in the Philippines. They are really there to assist the Philippine government and the Philippine armed forces in their quest to rid their country of terrorist organizations; in this case, specifically the Abu Sayyaf group, which we know has some ties to the al Qaeda organization as well.

And what we hope to bring to them is some assistance and some training and some advice in the areas of command and control, of communications, of intelligence analysis and fusion of many sources of intelligence. And we'll do that, provide that advice and training, down to the battalion level. This is not an operation like you saw in Afghanistan. This is assistance. This is training.

To answer your other question, is it possible that our forces will come in harm's way -- and I think the answer to that has to be it's absolutely possible. This is a very dangerous group. They have kidnapped many people over time, and, in fact, they hold two Americans today, as I think we're all pretty well aware of. They have beheaded people.

And so it's a very dangerous group, and so I don't think we should think that our folks will not be in harm's way. But this is to assist and advise the Philippine armed forces so they can take the fight to the enemy with our assistance.

SEC. RUMSFELD: Mr. Chairman, may I comment on that?

SEN. LEVIN: Yeah. And also, if you would, while you're commenting, tell us, given that prospect, will the Congress be given notice, under the War Powers Act, of that prospect?

SEC. RUMSFELD: Let me just first elaborate briefly on General Myers' response. There are really two aspects to the existence of U.S. armed forces in the Philippines. One is, as the general indicated, training in the process that the some 4,000 or 5,000 Philippine troops are engaged in trying to deal with that terrorist group.

The other is, there may very well be some in the Philippines on an exercise, which is a separable thing. The reason I mention this is because there's been some sensitivity in the Philippines. They have a constitutional provision about foreign forces being in their country for combat purposes. And the president of the Philippines and the ministry of defense of the Philippines has been very careful to properly characterize what our role is.

What General Myers had reference to the dangers is that clearly there is always the problem of self-defense. And therefore, our troops that are involved with assisting and training -- with training, essentially -- do have rules of engagement that permit them to defend themselves, but they're not there in an active military role, as the president of the Philippines and the ministry of defense of the Philippines has indicated.

SEN. LEVIN: My time is up. We'll pick that up, because I think there's still some real difference as to the prospect of them engaging in what is normally called combat and what the very purpose of the patrols that they'll be joining is, unless you're saying they're not going out on those patrols; they're going to be limited to a battalion level. If that's what you're saying, that's different, because then they're not going out on the patrols that are seeking out to destroy the terrorist group.

GEN. MYERS: That's -- Mr. Chairman, the current plan is that they will advise, at this point, no lower than the battalion level. And so that -- I think your assumptions are correct.

SEN. LEVIN: Senator Hutchinson, you're next. And if you would, when you're done, if you could pass that along to the next person in line.

SEN. TIM HUTCHINSON (R-AR): Thank you, Mr. Chairman. Thank you for calling the hearing today. And I want to thank Secretary Rumsfeld and General Myers for the leadership you are providing our country in this war on global terrorism. And as I told you before the hearing, Mr. Secretary, I think our country is fortunate to have you and your team at this time of our nation's -- great crisis in our nation, the great challenges that we face, and I'm glad you're there. The sobering assessment that you have given in recent days in speeches that you have given and in briefings you have given, as well as the very strong and forceful language that the president appropriately used in the state of the union address, I think continues to keep us, not only as public policy makers but the American people on the alert and aware of the great challenges that we have ahead, and that this is not a short or easy prospect that we have. And I think the assessments you have given fully justify the kinds of budget requests that you've laid out before us today.

You mentioned in your prepared statement, Mr. Secretary, that $300 million to create a biological defense homeland security support program to improve U.S. capabilities to detect and respond to biological attack against the American people, and I'm pleased with that and I want to ask you about it. But the whole area of biological defense is something that I've been very involved in and concerned about. I have supported the administration in their desire for a national missile defense and its rationale -- that we must not leave our cities, we must not leave our citizens, the American people, our population defenseless against enemy attack. And yet when we look at the are of vaccine production, the American people -- the possibility of biological attack and what we saw with anthrax, the American people remain defenseless to a large extent against a threat that is arguably greater and more imminent than a missile attack.

General Myers, in your submitted testimony you state in view of today's security environment, we must develop an adequate vaccine production capability. Well, I'm very pleased with that recognition of that as an immediate priority. As we send out troops into combat around the globe, it is critical that they have adequate protection against biological weapons. And it seems to be that there has been a growing consensus that the department needs to establish an organic vaccine production capability, a GOCO if you will, as the key to our vaccine acquisition strategy. The Department of Defense recommended this approach twice, including a report that was issued last August. This approach has been endorsed by the Gilmore Commission on Combating Terrorism. The approach has been endorsed by the Institute of

Medicine at the National Academy of Sciences, and last year's defense authorization bill included the authority for the department to go forward with a GOCO.

So my question, Mr. Secretary and General Myers, is will the department be moving expeditiously on the planning, design and construction of a vaccine production facility?

SEC. RUMSFELD: My understanding of the current status is that the Department of Defense has been working with the Department of Health and Human Services closely, and that the decision as to whether to further fund a government owned-contractor operated GOCO, or a contractor owned-contractor operated -- I guess it's COCO -- production facility is pending, and that the analysis of the national requirement for bio-defense vaccines is what the pacing item is.

SEN. HUTCHINSON: General Myers, could you comment on that?

GEN. MYERS: The only thing I would say, Senator Hutchinson, is that the requirement to have some sort of facility, however it's organized, is, I think, pretty well document. And I think that the discussions and the process is going on to figure out the best way to do this. And -- but from my standpoint, the requirement is a valid requirement.

SEN. HUTCHINSON: I think, in fact, that the studies, as I quoted -- as I cited them, that the consensus has been GOCO. You know, COCO has kind of a funny sound to it. GOCO sounds -- (laughter) -- but the decisions on this, do we have any time frame on when we can expect those kinds of decisions on which direction we go on an acquisition strategy?

SEC. RUMSFELD: I don't know of a time frame on it. I could check.

SEN. HUTCHINSON: I would appreciate getting some guidance on that. I think it is a huge issue. And we all understand, I think, the vulnerability that our forces face, and indeed the vulnerability that the American people face to biological attack. It is a huge are of the weapons of mass destruction that we've got to face and address, without alarm and without panic, but expeditiously. There's been too much, I think, time that has passed already in a plethora of studies, when what we need is action.

Once again, I want to thank you. I just am very pleased with the kind of forceful and reassuring leadership that you have given our nation and the American people.

SEN. HUTCHINSON: Thank you, Mr. Chairman.

SEN. WARNER: Mr. Secretary, we had to go vote -- we apologize, but we wanted to keep the committee rolling and use the time.

You and I discussed yesterday at lunch the question of my concern, and indeed I think a lot here in America about the decline in the military spending by some of our principal allies, particularly NATO. And last week, Secretary Wolfowitz on your behalf attended the Wehrkunde conference, where the secretary-general of NATO, Lord Robertson, had the courage -- and we know him well -- we have a high respect for him, by the way. He was former chief of the defense for the British government. Robertson said, quote, "Europe has the status of a military pigmy -- strong words -- and has fallen far behind the United States in terms of military capabilities, the result of not investing enough in defense." Here we are, our president quite properly is asking for the largest defense spending in two decades, the last being under President Reagan, of that magnitude. Taxpayers are ready to, I think, assume it, bipartisan spirit in the Congress. And terrorism is common to all nations in terms of its potential threats.

What can you say to the American public here on this moment as we address this budget on that question?

SEC. RUMSFELD: Senator Warner, it's a question that we all think a lot about. And certainly as a former ambassador to NATO, I've thought about it a good deal in terms of the contributions over the decades. And I think it has to be said that during the period of the Cold War, our NATO allies were involved and did invest, and to varying degrees to be sure, and it did tend to ebb and flow over time. But thanks to the leadership of successive governments in both sides of the Atlantic, we were able to have the kinds of investments that enabled us to prevail in the Cold War. There's two pieces I would respond to with respect to today.

First, with respect to the war on terrorism, we are receiving assistance from a number of countries -- NATO countries as well as non-NATO countries -- and in terms of dollars, in terms of in-kind contributions, in terms of troops on the ground. And I think down at CENCom in Tampa, General Franks has something like 20-plus countries with liaison people there that are actively cooperating in intelligence sharing and over-flight rights, and basing rights, and troops, ships, aircraft, and there is a coalition that's functioning.

Second, with respect to Lord Robertson's comments, he is basically right that the -- well, for whatever reason, we're in a period in Europe where a lot of the governments have not been making the kinds of investments in defense that the NATO council continuously calls on them to do. What is the answer to that? I suppose -- I guess I don't know any better answer than anyone does. I suspect that -- that the thing that we understand in this country, to our great credit, is that all of our freedoms, all of our opportunities depend on having a relatively peaceful and relatively stable world. And it is the armed forces of the United States that enables us, along with diplomacy, and along with economic interaction, to contribute to peace and stability in the world, and to provide the kind of deterrent that prevents things from erupting into global conflicts. And, we have no choice. At this moment in history, we as a country have a leadership position. It is distinctive. On the other hand, there isn't any reason in the world why the European countries can't do more, and indeed could do more. No country has to do everything. Those countries are perfectly capable of selecting our areas where they can be particularly helpful, and some have -- there's no question about that.

SEN. WARNER: Well, if I could interrupt. You, I think quite properly in your testimony today, alluded to the tragic loss of life on 9/11, but also an extraordinary, severe impact to our nation's economy. And the figures that you relate today are staggering and should be considered not only here at home as we accept this request of our president for increased defense spending, but clearly abroad they have the same tall buildings, they have the same vulnerable targets, and it could be at their doorstep next. And I hope that those facts that you related distressingly this morning will be taken to heart by them.

Mr. Secretary, during the course of our visit to the region, we -- Senator Levin and I over Thanksgiving, including four Thanksgiving dinners, which was quite interesting -- (laughter) -- in 36 hours -- we met General Franks. We will have him here tomorrow before this committee. But as you know, General Myers and Secretary Rumsfeld, he's done a brilliant job.

SEC. RUMSFELD: Absolutely.

SEN. WARNER: It's extraordinary to have had him in place at this particular point in time. But I talked to him at length about the -- while I was in that region -- and visited a carrier myself, the importance of our naval ships which were able to bring platforms from which our aircraft could launch as close as possible, because of the waters in which they operated, to the targets. Even in that proximity, of as close as they could get, they still had hours -- some of those missions took four and five hours to get in on target, to be there just 30 minutes or so, and then come back out, with significant refuelings and the like. Which brings me, Mr. Secretary -- I think you're the first secretary in history to have been a naval aviator. Have you ever checked it out?

SEC. RUMSFELD: No sir, I haven't.

SEN. WARNER: Well, I think it's required history -- and having flown off those carriers yourself, I took note that your budget sort of slipped funding for the carrier that's been planned for a number of years. When you look at the funding profile, I think it's not one that will cause any question about the carrier program. But I just would like to have your reassurance that the carriers are still an integral part of our shipbuilding program, and that this slipping of one year to enable technology to catch up with the construction contracts is in no way to be construed as lessening of support in your department for the naval aviation component, and particularly those of carriers.

SEC. RUMSFELD: No sir. You've stated it exactly correctly. I believe it's a one year slide to the right --

GEN. MYERS: That's correct.

SEC. RUMSFELD: -- on the carrier. And there is no question but that the quadrennial defense review and the defense planning guidance that went out fully recognizes the importance of carriers in our capability.

SEN. WARNER: And that quadrennial review had 180 -- 108 active duty surface combatants and 55 attack submarines. And our shipbuilding today will not enable us to maintain those force structures unless we begin to see an increase. And I've so indicated to the secretary of the navy that, in my conversations with him yesterday, and he gave me the assurance that they are going to address it in the out years.

Precision-guided missiles, General Myers, in your written testimony you mentioned that over 17,000 precision and free-fall munitions were employed in the support of the operations in Afghanistan. You also mentioned the importance of maintaining sufficient industrial surge capacity to fill the need for these weapons during your sustained high-tempo operations. What percentage of the weapons used in Afghanistan were precision-guided? And does the fiscal year 2000 (sic) budget, which you're presenting today, restore and maintain sufficient inventory of these weapons?

GEN. MYERS: Well, Senator Warner, the good news is that both the supplemental for the war on terrorism in '02 and the '03 budget do exactly what we need to do in terms of preferred munitions, which in the most case are precision munitions. The problem we found ourselves in is we had some new munitions coming on board. We had not built up sufficient stocks to cover what all the unified commanders thought they needed for their war plans, but we were in the process of doing it. It was kind of the normal process, if you will. We have -- we have significantly increased the funding, again, in the '02 supplemental for the war, and in the '03 budget, to correct those deficiencies. One of the interesting things we are going to have to look at in the future, in the case of our joint direct attack munitions, that they became quickly the preferred munition. And, as I remarked in my oral statement, those were the global-positioning system-guided weapons that are particularly useful in any conflict, but particularly in this conflict. In fact, we were using almost

3,000 a month during this conflict. Laser-guided bombs as well -- about 1,700 a month for those. So they were the weapons of choice. They are both essentially built by one manufacturer each, and they have some common subcomponents that are common to both of them, with only one supplier. So we have potentially -- we have potentially an industrial base issue. But we have ramped up production. We think the '03 budget really supports that in all the services, the Air Force and the Navy in particular.

SEN. WARNER: Senator Kennedy, I believe you are next, but just to follow-up, do you see our allies moving ahead on that, guided weapons?

GEN. MYERS: Let me talk -- that's a key point. If I may talk, Senator Warner, I think you bring up a very good point. The practical aspect of underfunding defense with our allies and our partners is that as time goes on it becomes harder and harder for them to participate with U.S. forces. We get ahead of them in terms of precision-guided weapons -- so that's an issue for our allies for sure. We get ahead of them in our ability to provide the strategic lift, be it sea lift or airlift, to get our forces to spots in the world where we need them. That's another big shortfall with our allies and our partners around the world. And particularly in their ability to link with us -- I talked about the command and control, the C4ISR piece. The longer time goes on, the smaller the budgets, we are going to find it very, very difficult to continue to work with some of these countries.

Now, what the secretary has suggested is that they could specialize. You know, they could -- some nation could decide that we are going to -- strategic airlift could be their specialty, and they could help in that regard. But, regardless, this is an issue that is, as time goes on, will become more and more serious. And I think precision munitions is exactly one of those. We have transitioned our force -- I think in Desert Storm 10 percent of the munitions we dropped were precision munitions. And we have essentially flipped that in Afghanistan. We flipped those measures, where upwards of 90 percent of our munitions were precision munitions. And our allies need to come with us on this journey to provide, as the secretary said, the defense of freedom, so we don't have to fight these wars.

SEC. RUMSFELD: I think it's worth mentioning that the North Atlantic Treaty Organization invoked the article that provided for an attack against one is an attack against all. And as we sit here today, NATO AWACS are flying over the United States, assisting us with the homeland security aspect of our problem. So -- and we also don't want to lump all the allies together. I mean, there's no question but that the United Kingdom, for example, has been some very capable aspects of their armed services that have been contributing significantly in Enduring Freedom.

GEN. MYERS: Senator Warner, let me correct my number. It's a little greater than 60 percent precision munitions, not 90 percent, as I stated.

SEN. KENNEDY: Thank you very much, Mr. Chairman, and I join in welcoming the secretary and the chief to our committee. Certainly some things were done right over the period the last eight years, because our servicemen and women are performing so well, and we all take our hats off to them.

We have a limited period of time to ask questions. I am going to give you three, Mr. Secretary, and this isn't multiple choice; if you could comment on them, I'd appreciate it. And since your comptroller is there, we'll start with a more technical one. One of them is with regard to the science and technology. You have said we need the best trained, best led, and the best technology. And yet your science and technology budget -- I am not talking about the R&D budget -- I am talking about your science and technology budget, even with the increase is effectively flat. Why? Isn't this necessary in terms of where we are going in the future?

Secondly, if we compare in the ship-building -- and you have commented on it, we'll hear more about it -- but I took the ship- building program under the Clinton program for two, three and four -- years two, three and four, or three, four and five, yours three, four and five. They get up to 23 ships. You are at 17 ships. I know there's a difference in the -- not a great deal of difference in the ships, but a rather significant difference. Even with your increase in budget, the ship-building budget is really rather dramatically lower than it was even in the Clinton program which had a significantly lower defense budget. Perhaps you would want to make some comments. We'll hear more from the secretary.

Really the third item, and perhaps the one I'd hope that you might spend the most time addressing, is I had a chance to go out to Fort Detrick recently and see what the DOD is doing out there in terms of bioterrorism, both in terms of equipping our servicemen and women with the vaccines, and also what they are doing in terms of trying to make recommendations how to preserve not only the military men and women, but also civilians in bioterrorism. They talk there's a good deal of expertise out there in terms of understanding what the Russians are up to. A number of them have been over in the Soviet Union with counterparts in the Soviet Union. I'd be interested if you would comment about -- one, about your own sense about the effectiveness of the storage of the various bioterrorism materials in the Soviet Union, and how secure they are, as well as the scientists that have been working in those areas, as we are looking in the area in terms of prevention. What are we doing in terms of the budget on the cooperative threat reduction? That obviously applies to the nuclear, but it also can be used in terms of the bioterrorism. And in your budget, what addresses that? And perhaps you'd comment as to what you -- what is being done now, and what you think should be done.

SEC. RUMSFELD: Yes, sir, I'll start, and just make a brief comment on the S&T budget. You are right, it is not up to the level we are aiming for, which is about three percent. I think we are in

2003 at about 2.7 percent of the overall budget. It is a very important aspect of the budget. Trade-offs were made, choices were made, and that's where it came out. But I certainly agree with you that it's important.

The -- Dov, do you want to comment on the --

MR. ZAKHEIM: Sure. On the numbers, sir, we tend to look at what our request is compared to the immediately prior request, simply because there are a number of programs that the Congress chooses to add. And just to have an apples and apples comparison, we look at what we asked for the previous year. We are up by over a billion dollars relative to the previous year. We are actually slightly up, even if one includes the congressional add-ons that took place in fiscal year '02, although it's a small amount, something like $13 million.

But, more important in terms of the percentages, senator, is that even though our baseline is so much larger because of the increase, we are actually slightly above percentage-wise what we asked for a year ago. A year ago we were at 2.65 percent; now we are at 2.68 percent. So we are headed towards the three percent goal. We are maintaining that goal, even though the baseline is larger.

SEN. KENNEDY: Just quickly, because my time will be up -- I was looking at really the science and technology rather than the total R&D budget, which is the 53.9, just the science and technology, which is the advanced --

MR. ZAKHEIM: That's what I am referring to.

SEN. KENNEDY: -- as I understand it, you have gone from 8.8 to 9.9 (billion dollars) --

MR. ZAKHEIM: That's right --

SEN. KENNEDY: Effectively flat on this part here. But this is -- you I think have answered the question on it. It is I think sort of leads on into making sure we are going to have the cutting edge.

MR. ZAKHEIM: Yeah, but that is a billion dollars, sir, which is not really flat -- it's about -- over 8.8 billion -- it's quite a significant increase, when you are talking about 1.1 billion (dollars), sir.

SEN. KENNEDY: On the ships, Mr. Secretary --

SEC. RUMSFELD: Yes, sir. The -- as I mentioned in my opening remarks, and in the prepared statement, the United States Navy made some choices during this budget cycle that was based on their conclusion that because the average age of ships in the United States Navy is relatively young, because of the sizable number of purchases during the '80s, during the build-up period, that they were better off making choices that tilted their funds towards the O&M accounts and towards some aviation accounts.

Now, they recognized that we cannot sustain the current size of the Navy, if we are building ships at the rate that this current budget proposes -- and this budget is down, I believe about a billion dollars in ship-building. Therefore, if you look in the forward-year defense plan, we do get up to the 10 in the last year, and I believe six, seven or eight in the medium years, which will begin to correct the problem. There were bills from prior ship-building contracts that were much larger than had been programmed in that budget, and I believe that was something in excess of $600 million, that we are paying this year for ships that were being budgeted in prior years. So we are having to pay off these overruns that existed.

There were also -- oh, I guess the DDX is simply not ready. But do you want to comment additionally?

MR. ZAKHEIM: Yes, sir. On the prior-year contracts, senator, if you took what we put in in '02 for prior year ship-building, which was about 730 million, and you add what the secretary just mentioned, about 645 million, you could have bought at least one ship, and maybe today. And the decision was made that we really needed to clean up our past act first. And that I think goes to the heart of what we are trying to do with realistic budgeting, and to have a better baseline from which to build more ships. And as the secretary said, because we have a fleet that is about 16 years old on average, it gives us a little bit of time to do both: clean up the past and get ready for the future.

SEN. KENNEDY: Well, I appreciate it, and I know the time is running down. I think particularly where there is a number of the older ships, on the auxiliary ships and other resupply ships that are really old in terms of it. But I appreciate your comment. We'll have a chance to talk to the secretaries about it.

On the questions on the bioterrorism, Mr. Secretary?

SEC. RUMSFELD: Dov, why don't you respond?

MR. ZAKHEIM: Sure. Senator, you asked about the bioterrorism, the CTR program you referred to -- it's commonly called Nunn-Lugar. We are funding it at $416 million, which is roughly what we funded it at last year. As you know, not all the monies in the past have been expended, and there has been a considerable build-up of unexpended funds. And many people have argued for that reason that we shouldn't have put more money in. The administration felt -- the secretary felt that it was terribly, terribly important to keep funding CTR, to send a message that we were prepared to do exactly what you are talking about. And that's why we have maintained the level.

SEC. RUMSFELD: I would -- with respect to the last part of your question on that, Senator Kennedy, we have to worry about the biological weapons and capabilities of Russia, and how they are managed and how they are handled. And we clearly have to worry about the people that were involved in developing those capabilities, because they are available to other countries to assist, and it is a very serious problem.

SEN. KENNEDY: If I -- my time is up, but I'll send you just a brief note on that, if I could, about some of the observations we have made out there, for your whatever consideration you'd have. Thank you very much.

SEC. RUMSFELD: Good, thank you.

SEN. KENNEDY: Thank you very much.

SEN. WARNER: I think Senator Inhofe.

SEN. LEVIN: Senator Inhofe.

SEN. INHOFE: Thank you very much, Mr. Chairman. Let me first of all say that there's going to be some criticism as to the level of the defense budget. But there are a lot of us who feel that it is even what you have sent to us is still inadequate in many areas, as I think was pointed out by Senator Kennedy. And I have some of these areas that I am very much concerned about. I have to say that I just returned the last five from Ramstein, Aviano, Vincenzia, Camp Eagle in Bosnia, Camp Darby way down in the southern part of Italy, and the hospital at Landstuhl. And my reason was that, you know, back when Republicans were important -- I was the chairman of the Senate Armed Services Committee on Readiness for about six years. And so I have an orientation towards readiness. And I have to say in all cases we have a very high op tempo -- I think we all know that. We have a high level of dependency upon Guard and Reserves.

But I want to share with you, at the hospital at Landstuhl, for some of my members who may not be aware of it, that's where all of those that are injured in the Afghan effort are immediately transferred to. I talked to a number of the individuals, a number of the troops who are over there who are injured, who are really paying a high price. Specialist Justin Bingoule (ph) of the 10th Mountain Division was crushed in an earth-moving effort over there. Chief Warrant Officer Fred Palino (ph) of the 101st, along with Corporal Eldridge (ph) in the 101st, both in that helicopter accident, which is a very tragic thing. And lastly, Seaman Latoya (ph) Stennis -- oddly enough the same name, she was on the Stennis -- and she was an entry- level seaman, the one that all of you are aware of, but maybe some of my colleagues aren't -- who was swept off in a refueling accident from the Stennis in the Afghan theater. All four of these -- could you just imagine being swept off into the -- falling 66 feet into the water down, crushing both lungs -- all four of these said that their first concern was to get back with their unit. All four said, as did everyone else I talked to, and those who were injured, that they are going to be career. I mean, I just can't tell you how moving it is when we talked to these individuals -- I know that you have done that, both of you, General Myers and Secretary Rumsfeld have done that. But at the same time, while Senator Kennedy brought out some of the inadequacies of the budget, I see force structure as an inadequacy. These people are willing to do it now. But we know, and you have said many times -- and this is going to be a long and sustained effort. And we are using our Guard and Reserve to a point where we are losing some real critical MOSs. They don't want to leave, but they have to do it, because these people by the very nature are maintaining a career.

So I'd like -- since we were flat in our force structure, and I know that you would probably agree with me that we should be increasing it on the regular services -- I would like to have your comments on that. And if you don't feel we need to increase it, what we can do in terms of the problem that we are having with the Guard and Reserve -- they are doing a great job, but some of them just can't continue with these deployments.

SEC. RUMSFELD: Senator Inhofe, I share your feelings after visiting troops, and certainly thank you for your many visits to the troops. I know they are appreciated by the men and women you visit, as well as the rest of us. General Myers properly talked about the fact that this is a total force effort, and indeed it is. I mentioned that we have some 60,000 Guard and Reserve, and another 10,000 people that are being held in, for a total of 70,000 that in the normal order of things would not be involved in the activities of the U.S. armed forces, absent the war on terrorism.

We are doing a variety of things to deal with it. For one thing, every time we get a homeland security request for the use of Guard and Reserve, what we have done is we've required that there be an exit strategy, so that when they say they need men and women from the armed forces to go and handle the airport security, or go and handle border security, or INS, or Customs -- all of which are there -- in each instance we have said, Look, those are basically civilian responsibilities, and they should be handled by civilians. And we are willing to help at the outset, but we need an exit strategy. We need to be shown a plan where these organizations are going to establish training programs and get the right numbers of people that they need to do the jobs that need to be done. So we feel that at least a nontrivial portion of the total is a temporary situation.

Second, we are hopeful that we can reduce the demand on strip alerts and CAPs at some point in the period ahead, and it varies with the threat assessment.

The other thing I would say is that we -- I have been making an effort, and I must say it is not easy -- but making an effort to try to get some of the U.S. forces that are around the world, in places like Sinai and places like Iceland -- and we have been pulling down the number of troops along with our allies in Bosnia at a very responsible measured rate -- so that we can get others to back still behind us in some of those activities. And I agree with you, right now there is a very high op tempo, and first tempo, and we need to recognize the stress it puts on people.

SEN. INHOFE: Mr. Secretary, I really do appreciate that, that you folks recognize that, and I know that you are going to try to pull them in from other areas, and it's going to be necessary, and I agree with you. The week before I spent some time on all three of the ships that would be deployed with JFK when that time comes from the East Coast, and obviously I am talking about the U.S.S. Whitney, the U.S.S. Wasp, and the JFK. And one of the things that I found was that while they had a chance to train on Vieques on inert, and they all came to the conclusion, Yes, we have to have that type of training, obviously it was inert and not live.

Now, we passed in the Section 1049 of the 2002 authorization act language that says that we will continue our training on Vieques as it has been in the last 50 years, until such time as we get the certification of both the CNO and the Commandant, which has not happened. Now, let's keep in mind that all of those out there had come to the conclusion that we were lucky enough in this deployment to have training, even though it was inert training, and that we would not have had adequate training without that; and, number two, it would have been better, and our troops would have been better trained if we had live training. What are your plans in specifically addressing that section of the fiscal year '02 authorization bill?

SEC. RUMSFELD: I am going to ask that the secretary of the Navy and the chief of naval operations respond more fully. But I do note here that the decision to train the JFK off the East Coast rather than in Puerto Rico was made by the operational commander responsible for training Atlantic naval forces. And in response to the war on terrorism, we have had to modify the normal rhythms of deployment, upkeep and predeployment training.

Apparently CINCLANT Fleet decided to save transit time at sea by conducting the final training close to home port, and they used the saved days to focus on other predeployment issues facing the Kennedy.

SEN. INHOFE: Yeah, rather than have General Myers comment on that, General Myers, you stated --

SEN. KENNEDY: The senator's -- the senator's time has --

SEN. INHOFE: Mr. Chairman, in all respect, the last questioner went nine and a half minutes -- couldn't I get one more question in here -- is that all right? General Myers, you had stated that you had noted a negative impact on operational readiness caused by the usage, restrictions and shortages in training areas and ranges. That's exactly what we are talking about here. And if we were to lose this, this will have a domino effect on all ranges in all services -- not just Navy and Marine, as we are talking about right now. Are you concerned about these, as you state in your statement here? And don't you believe that this would have a negative effect on other ranges?

GEN. MYERS: Senator Inhofe, I think what I am most concerned about is when we deploy carrier battle groups that they be trained and ready. And I am worried about encroachment of training areas -- not only in the continental United States, but elsewhere in the world, because we have got to be trained to be a ready force.

In this particular case, like the secretary, I think this is primarily a Navy issue, and they are going to have to figure out if there are alternative ways to train. Any time we lose any training space, though -- I mean, there -- we are not getting more of it, so it's only going to be a negative -- it's only going to be a minus when we subtract something. But there are other ways we can hope to train. And, if I can tag onto that, just a little bit on the in-strength question, one of the things we are hoping to do -- and I know the services will come in with some in-strength requests -- I have not seen those yet, but we are all concerned about those. We spent a lot of resources for force protection, both here at home and abroad. And I think clearly that is an area that is susceptible to solving some of our issues with technology, and not being so manpower intensive. So I think that's one of the things we can look at in terms of in-strength.

There are also some transformational initiatives, going back to your earlier question, that I think will hopefully save us some manpower. So we have got to look for those efficiencies, at the same time as we look for legitimate requests for in-strength increases.

SEN. INHOFE: Yes, I would only ask that you do confer with those responsible for the training that was the non-unified training that was taking place, just to get their input. I think it's very important that you do that.

SEN. KENNEDY: Senator Byrd.

SEN. BYRD: Mr. Chairman, Mr. Secretary, I join in everything that has been said by all parties, expressing accolades to you, and in particular to our service men and women I join. I have been very impressed with your performance as secretary of Defense. I have seen a good many secretaries of Defense -- you are one of the best during my 50 years here in Congress. You have been forthright in your press conferences. I have viewed them with having been greatly impressed by your common-sense approach, by your frank and up-front responses to questions. I am fully supportive of what we are doing in the war on terrorism up to this point. I have lived a long time, and I have served half a century in this body at the completion of this year. I have been a hawk for 50 years here in Congress. When I first came to Congress, I was opposed at the entry of Red China into the United Nations. I fought it. I supported appropriations for the war in Vietnam. I was with General Chiang Kai-shek and the madame on their wedding anniversary in 1955 on the island of Formosa. We don't hear that name cast about much anymore.

I was the last hawk to leave Vietnam. As a Democratic whip in a Democratically-controlled Senate, I offered an amendment supporting the president, Mr. Nixon, in his efforts to bomb the Vietcong enclaves in Cambodia, because men were coming out of those enclaves and killing our men in Vietnam. I supported that against my then majority leader, his position, Mike Mansfield, the late Mike Mansfield. So, I think I have pretty good credentials. I join in the accolades, as I say.

I am concerned as to where we are going. I am concerned not just with today or tomorrow, but with a year from now, two years from now, three years from now, four years from now. I think that under our Constitution we have a duty to ask questions. The president said at the Citadel two years ago, Sending our military on vague, aimless and endless deployments is the swift solvent of morale. I will replace diffuse commitments with focused ones. I will replace uncertain missions with well-defined ones. We must be selective in the use of our military, precisely because America has other -- America has other great responsibilities that cannot be slighted or compromised.

Now, as a member of the United States Senate, as a senator from the state of West Virginia, as chairman of the Appropriations Committee in the Senate, I have a duty to look ahead and try to see where we are going. The president is a very popular man at this moment. So was his father in Desert Storm. Fame is a vapor. Popularity an accident. Riches take wings. Those who cheer today may curse tomorrow. I think we as senators have to keep these things in mind. We need to ask questions. We have other great responsibilities that cannot be slighted or compromised. I am thinking of the baby- boom generation. They are looking forward to Social Security program. They're looking forward to Medicare. Our aging population is looking forward to drug prescriptions. We have great problems out there. And yet we have, in this budget, only 2 percent increase for domestic discretionary programs, generally speaking.

Now, our time is very limited. I could ask many questions. Let me ask just two or three. I'll ask them all at once and give you an opportunity to answer, if you will.

We say that we're spending a billion dollars a month. We spent $7 billion in Vietnam in four months. We have a budget here that's going to spend over a billion dollars a day on defense. Defense is the first priority of any nation; security. I don't take a back seat on that. I've supported defense programs. Practically every weapon system that has ever been thought of, I've been a supporter of it. So you're not looking at a naysayer, Mr. Secretary.

But when we say we're going to bring these people to justice, we've already spent $7 billion. Whom have we brought to justice thus far? When we say we're going to go into the caves, we're going to run them out of the caves, we're going to keep them on the run and there's no place to hide until we win victory, my question is, what is victory? What is victory?

So let me ask two or three questions. What is our goal in the war on terrorism? Is it to topple regimes that support terrorism? How will we know when we're winning victory? How will we know?

You said just a few days ago that there will not be a signing ceremony on the USS Missouri to signal the end of the war on terrorism. But what will victory look like? How will I, as John Q. Citizen, know that I have accomplished my objective? What is the objective, beyond what has been said? "We'll keep them on the run; we'll run them down; they can't hide; we'll bring them to justice; victory will be ours." What is victory? What is going to be our standard of measurement?

Also, the president, in his State of the Union address, singled out Iran, Iraq and North Korea. And he said, "All nations should know America will do what is necessary to ensure our nation's security. We will be deliberate. Yet time is not on our side. I will not wait on events while dangers gather. I will not stand by as peril grows closer and closer."

Now, what does this mean? How about North Korea? The president included North Korea in his axis of evil. When does the president have authority to send U.S. troops into North Korea on the strength of the September 14 resolution?

These are questions which I would ask. Now, it may be that you will not be able to answer these today. Maybe you won't have the time. But the questions ought to be asked. I have a responsibility to ask these questions. And I hope that we senators will keep in mind this Constitution which I hold in my hand.

Yes, Mr. Bush is the commander-in-chief. But take a look at this Constitution and see what powers this Constitution gives a commander- in-chief. Take a look also at the congressional powers in Section 8. Let's not forget this Constitution. We're in a conflict now, and we intend to win. But when will we know when we have won?

How many more years will we be appropriating at the rate of a billion dollars a day, when we have the baby-boom generation looking at a -- we who are here are going to have to answer these questions. And it may be the popular thing today to say, "Me too, me too." And so I say, "Me too." But I also say that "me too" has a responsibility under this Constitution to look to other responsibilities to which the president referred in his speech at the Citadel; other great responsibilities.

So if I may just ask those two or three questions. Let me ask them again so that we'll be clear. What is our goal? What is our goal in the war on terrorism, number one? How will we know when we have achieved our goal? What will victory look like?

And finally, a specific question: How about Korea, North Korea, which the president included in his axis of evil? Do you believe that the president has the authority to send U.S. troops into North Korea on the strength of the September 14 resolution, for which I voted?

I thank you. I thank you.

SEC. RUMSFELD: Thank you, Senator Byrd, for your comments and your questions. There's no question but that the defense request is an enormous amount of money. And the fact, however, is that it is about 3.3 percent of our gross domestic product. It is a much smaller demand today than it has been during my adult lifetime in terms of use of funds for defense purposes as opposed to non-defense purposes.

As a percentage of the federal budget, it's down from over 50 percent down to about 16.9 percent. So it's demanding a smaller percentage, even though, as you point out, it is a much larger total number of dollars. And those questions are important questions, and I quite agree that it is appropriate for members of the House and the Senate to pose those and to pose them vigorously.

I'll do my best to respond to the first one as to what's the goal. The goal is to recognize that we're living in a dramatically different period than we did in my time in Washington dating back to the 1950s. We had a big margin for error in those days, when weapons had shorter reach, when weapons had less power. There were not multiple nations with weapons of mass destruction.

Today we have a very modest margin for error. An error today, with the existence of weapons of mass destruction, changes the effects dramatically. So we can't afford to make a mistake. And it seems to me the goal is to recognize that the nexus between weapons of mass destruction and terrorist states that have those weapons and that have relationship with terrorist networks is a particularly dangerous circumstance for the world. And you know well, and that was the essence of the president's remarks in his State of the Union address.

How will we know when we've won, so to speak? It's a very difficult thing to say, because there are not armies and navies and air forces arrayed against each other. Instead there are these terrorist networks that are hiding out there, and they exist. We know thousands and thousands were trained in these terrorist training camps in four, five, six, eight, 10 countries. And we know that they are well-trained, and we've seen the training manuals that taught them and we saw the skill that was demonstrated on September 11th.

The complexity about this problem and the difficulty of the problem is that we're putting pressure on them. You said we're chasing them; we're running them to ground; we're trying to root them out. That's true. And it's part of the law enforcement effort that's taking place all across the globe. People are being arrested. People are being interrogated. Intelligence information is being gathered. Intelligence information is being shared.

And the cumulative effect of the pressure that's being put on these -- bank accounts are being closed. We're chasing them out of Afghanistan. We've got other countries making arrests in country after country. Singapore just made a series of arrests that very likely stopped some very serious terrorist acts.

All of that pressure is making life very difficult for those people. They are not going to be as successful in terrorizing and killing innocent people as they would otherwise have been.

So how do we know when we've succeeded? I suppose we'll know when we've succeeded when our collective free-world intelligence- gathering apparatus tells us that, in fact, countries are no longer harboring terrorists, that the countries where these terrorists have found haven have decided it's not in their interest to do that and that countries like Iran and Iraq and Syria and Sudan and Somalia and all the others that have been on the terrorist list -- Libya -- that are all public -- everyone knows those countries -- that they're no longer harboring terrorists and that fewer people give money to terrorist organizations and fewer recruits are signed up by terrorist organizations and more people flee a terrorist organization and more people are functioning with a heightened degree of awareness and sensitivity, that people turn in people that, in fact, look like they may be engaged in terrorist acts. And we've had some good success there.

Is it as simple as World War II? No, it isn't. It's much more complex. And I appreciate your question with respect to North Korea. I don't know that I can answer that question effectively. Obviously these are judgments that the president of the United States makes.

We do know certain things about North Korea. We know that they've got probably 100,000 to 200,000 people in detention camps, that they're repressing their people, that they're starving their people. We know they have a very active weapon-of-mass-destruction program -- chemical, biological and nuclear. We know that of certain knowledge. We know that they will sell almost anything to anyone on the face of the earth for hard currency, and they do it. They do it every single day.

And I would submit that it's very likely the president's State of the Union message was to let the world know what I just said and that people best be careful about spreading weapons of mass destruction to terrorist networks, as the North Korean government has been wont to do.

SEN. BYRD: Mr. Chairman, Mr. Secretary, I've greatly overextended my time. Thank you very much.

SEC. RUMSFELD: Thank you, sir.

SEN. KENNEDY: I yield to Senator Sessions, and I'd ask that he be extended a similar amount of time. And then we'll let the chairman get us back on track in terms of time.

SEN. LEVIN: So I think that you're the beneficiary, then -- the sole beneficiary. (Laughter.)

SEN. JEFF SESSIONS (R-AL): Thank you, Senator Kennedy.

SEN. WARNER: He can use it, too. He knows.

SEN. SESSIONS: Well, I have to -- I serve under Senator Kennedy on the Sea Power Subcommittee, and we have some real interest in those issues, that I would like to join in his expression of concern. And I also appreciate -- I know Senator Kennedy does intend to try to take a look at where we are in sea power and what we can do to strengthen that.

Mr. Secretary, we have come a long way since September 11th. Our nation was in shock and in a state of really unease. President Bush, through his vigorous leadership, and your professional leadership, General Myers, and all the men and women in uniform, have really transformed that, helped us get off the mat, to have a good vision about where we need to go as a nation. I salute you for it.

I never thought that we could guarantee that Osama bin Laden would be captured, and you made that clear from day one. But one thing the president said and you said is nations and governments that harbor him are going to be in big trouble. And the Taliban, that government that harbored bin Laden and allowed him to operate and to plan his attack on the United States to kill innocent American citizens, has fallen. It no longer exists.

And that was an achievable goal, and I salute you for achieving that. I think that was very important as a signal to the world of the seriousness with which the United States takes these kind of activities. And I am hopeful other nations in the future will think twice if they were to consider allowing terrorists to operate within their countries or, in fact, support them directly. I say that with great appreciation for the leadership that you've given us.

I also was a strong supporter of your initial vision for defense, that we must transform our Defense Department. President Bush said there may be generations of technology that we could leap into the future. We never have enough money to do everything that we need to do. It's essential that we be as creative and as technologically advanced as possible.

So I am very appreciative of your commitment to transform our Defense Department, which was clear and unequivocal before September 11th. I'm sure that within the vast Defense Department and within the defense contracting crew and within the politicians here in the Congress, there was objections all along the way.

So my question to you is, after this military effort, after seeing at least this face of what a modern battlefield might look like, are you more or less convinced that we need to transform? And what are some of your ideas in that regard?

SEC. RUMSFELD: Well, thank you very much, Senator Sessions. There's no question but that the many hours that General Myers and I spend together with the chiefs and with the senior officials in the department, but that what has taken place in Afghanistan has underlined and underpinned the efforts that we have been engaged in with respect to transformation.

We have seen significant changes from the Desert Storm to Kosovo to Afghanistan, and it has pointed up the importance of information, the importance of battlefield and situational awareness. It's pointed up the importance of connectivity and interoperability, as General Myers said in his opening statement. It has, in my view, underlined the importance of seeing that we exercise and train like we fight. And we're taking steps to see that we do a better job of that.

I think that it's probably true of every war, every conflict, that you immediately begin the process of saying, "What are the lessons to be learned?" And we have started that already. We have -- even though we're far from finished in Afghanistan and we've got a lot more to do with respect to the war on terror, we have begun that process of trying to capture the important things that we've experienced already.

And I would say one thing about transformation. There's a tendency for all of us to think of it in terms of a weapon system or a new unique way of doing something. I think of it also in terms of people.

General Myers and General Pace and General Jumper of the Air Force, the three individuals that have been very recently placed in their posts by the president of the United States, all of us had discussions about transformation during the decision-making process, as to who should be the new chairman and who should be the vice chairman.

We now have six or eight or 10 combatant-commander openings coming up in the next 12 months; chiefs, vice chiefs. And I would hazard a guess that five years from now, looking back, we'll say that the single most transformational things we did were to select those people, that they will then fashion their staffs and their key people and they will be involved in the promotions of the people under them. And it'll affect the United States of America for the next decade and a half, those decisions that are going to be made in the next 12 months.

SEN. SESSIONS: Well, I think the American people have had an unusual opportunity to see you and your leadership style, and they have great confidence in you and your vision for our Defense Department. And I think there's a window of opportunity here. I hope that you will push it. And please know that I would like to support you in it.

There are a number of issues on sea power that I'm wrestling with. I'm not exactly sure what the right number of ships should be for our Navy, but we need to know pretty well that. We need to know whether or not we can use some aging ships. We are decommissioning ships with projected life spans of 10 years or more left. I'm not sure that's wise. We know that it takes three ships to keep one ship on station. Perhaps we can do a better job of forward-deploying, of forward-stationing ships that could increase our effective ship force structure in that regard. There's a number of things that we could do there.

And, Mr. Secretary, I would just ask if you're concerned about that, and if you are going to be looking at some of these potential changes that could effectively allow us to have more ships deployed than we do today without maybe building as many new ships as we'd like to build?

SEC. RUMSFELD: Senator Sessions, thank you so much for your support on transformation and your generous comments. There has been the beginning of an analysis of shipbuilding and the size of the navy that is coming close to being completed, I believe, Dov.

MR. ZAKHEIM: That's correct, sir.

SEC. RUMSFELD: It has not been presented to me, but it is -- it is addressing the issues that you've raised, and that Senator Collins has raised, and Senator Warner, and so many others who have such an active interest in shipbuilding and the importance of the navy and sea power.

I do not know the answer to your question as to reactivating ships. It is going to be a part of that study, and I expect to be briefed on that some time in the period right ahead. I do know that there isn't anyone involved in the navy that made the recommendations for this particular shipbuilding budget, which, as we've all agreed, is skinny, and everyone agrees that the number of ships, if you did a straight line projection using five ships a year, you're going to end up with an unacceptably small navy. There's just no question about that. We have no intention of doing that.

And as I believe came up in the discussion with Senator Warner, the fact is the average age of our ships is relatively young. I think it's 15 or 16 years, Dov said. And that being the case, we can afford to -- that is why the navy made the choice they made -- and we can afford for a year or two to be under-building, as long as we recognize that in the out years we simply must get back up to the 10, nine -- seven, eight, nine, 10 levels. And in the meantime, we have to do a good job, I think, with respect to the shipyards, of seeing that we recognize the importance of the industrial base, and that we find ways to balance the tasks that need to be done by the way of engineering and other aspects of shipbuilding, even though we're living in a period with relatively low number of total ships.

SEN. SESSIONS: Just briefly, would you -- do you believe that the importance of dominance in space, and that unmanned vehicles is adequately addressed in this budget? Have you provided increases for those two areas that I think are pretty clearly proven to be essential for the modern battlefield?

SEC. RUMSFELD: I am personally satisfied that we have addressed the space issue in a responsible way, and we have the kinds of increases there that are going to be necessary to assure that we do not persist over a sustained period of time with a high degree of vulnerability, which realistically a country that is that dependent on space has to face.

The second part of your question, with respect to unmanned aerial vehicles, or UAVs, the Department of Defense has fashioned a phrase "low density, high demand assets." And what that means is that there's a lot of demand for them and we didn't buy enough of them. It's kind of a euphemism for we didn't have our priorities exactly right. We are living in a period where that's a fact. We do not have -- we did not have our priorities quite right. We do not have enough of these aircraft. They have done a superb job in -- not just in Afghanistan but in a variety of other intelligence gathering activities. In this budget, we have substantially increased the funding for unmanned vehicle. And, life being what it is, it's going to take some time.

Right now, there isn't a week that goes by that General Myers and I are not confronted by a combatant commander in some part of the world who is asking for additional unmanned aerial vehicles, and in fact, we are forced to deny them because there simply are not enough to go around. And we're building them as rapidly as possible. And Dov, you may want to comment on the specific dollars here.

MR. ZAKHEIM: Certainly, sir. Senator, we're spending close to a billion dollars this year on unmanned vehicles, which is a significant ramp-up, as you well know, from where we were. A Global Hawk, which everyone has read about, the very long-range UAV, we'll be spending an excess of 600 million just on that. We're developing a new combat air vehicle which essentially is a pilotless attack plane, developed from the start that way. That's in excess of $140 million. Predator, which again everyone has heard about, is the UAV workhorse of Afghanistan, over 150 million just on that alone. So, you have a major commitment that I think is unprecedented in the DOD.

SEN. SESSIONS: Thank you.

SEC. RUMSFELD: It's not just for new aircraft, either. There's modernization taking place with respect to these. We've lost a number of predators because of weather and icing. And we lost a Global Hawk. We've lost some because of control difficulties. We have some of these vehicles that are not armed, of course, and we're looking at different ways to improve their capabilities. We're also looking at some different sensors with respect to these aircraft.

So, it is an important area. It's been underlined by the Afghan situation, and we're putting some beef behind it.

SEN. SESSIONS: Thank you. I think that's a good direction. Thank you, Mr. Chairman.

SEN. LEVIN: Thank you, Senator Sessions. Senator Dayton.

SEN. MARK DAYTON (D-MN): Thank you, Mr. Chairman. Mr. Secretary, General, I want to join with the others in paying tribute to you, to certainly the president and your military command, and then our women in the armed forces, for you very, very successful prosecution of this war in Afghanistan. I was, along with others in the Senate, in Afghanistan, Uzbekistan, and other countries in Central Asia in January. And General Myers, I had the same kind of reaction as you expressed in your testimony to learning of Reservists with whom I had lunch who had volunteered for that duty, whose morale was extraordinarily high. I think the degree of professionalism is extraordinary, and commitment. And obviously, as you outlined, both of you -- the superiority of the military operation and the advances that have made, even subsequent to the Gulf War, have been very impressive and have had the kind of devastating results that we want to demonstrate to the rest of the world will be a consequence of the kind of heinous acts that were perpetrated on the United States in September.

It's not my purpose here to want to debate the past, but I do want to note for the record here that given that success, I think the -- I would like the hearing record to not reflect, at least without some questioning, the aspersions that are -- have been cast upon the predecessor administration. References are made to a procurement holiday in the 1990s which, if I believe the record is accurate, Mr. Secretary, the procurement budget that your administration inherited for '01 was in excess of $55 billion. If, as you say, we lived in the 1990s off of the investments made in the 1980s, then it seems to me that you have to give some recognition to the fact that whatever level of preparedness and effectiveness we have today is at least in some part a result of investments that were made during the 1990s. That's no to say that more doesn't need to be done. I would not quarrel with your observation there, and I think you and the president deserve due credit for both last year and this year sending that message loud and clear. And as Senator Warner has indicated, there was bipartisan support last year, and I believe there will be strong bipartisan support this year to doing whatever must be done. But I think it would be unfair to -- not to realize or acknowledge that some of this technological and coordinated superiority that we've seen demonstrated was the result of the United States at least not being unprepared to exercise that military force as a result of the previous administration.

I also think it's important in a context that does pertain to the future because, as Senator Byrd and others have noted, we and the administration also have to make some very, very critical choices in terms of our allocation of resources that are going to have real and long-term consequences for this nation. President Clinton perhaps can be faulted if some choose for, as was said here, over-shooting the mark in terms of reducing defense expenditures overall, but he also succeeded in reversing years of deficit spending and bequeathed to the nation four years of budget surpluses. President Bush -- and I give him credit because what I can tell this budget that he presented, the long-term, 10-year budget, is very -- presented very forthrightly in terms of its assumptions and its dollars, and therefore I think he's done a service because he's set forth clearly the critical choices that he's made and that this Congress is going to stand to review.

The military increases that are being proposed, while they are necessary and probably even essential, and are unavoidable in the context of what occurred to us, this nation on September 11th, also have very real consequences for our nation's financial security. And I think it's in that context that I, you know, that this committee will have to be making its own decisions about this budget request. Last year, OMB projected an on-budget surpluses every year for the next 10 years, totaling $841 billion. Now, one year later, OMB is projecting on-budget deficits for the next 10 years of 1-point -- almost $1.5 billion. The unified budget, including the Social Security and Medicare trust funds, which I think is somewhat disingenuous -- what I call sort of the federal government's version of Enron accounting. Even there, the total unified surplus has dropped by $2.5 trillion over the next 10 years, down to a 1-point -- a $1 trillion level, which means then that the Social Security and Medicare trust fund surpluses are funding these on-budget expenditures, which include defense along with all of our other functions of government, to the amount of $1.5 trillion over this decade. That means $1.5 trillion that is not going to pay down our national debt. It means arguably that we, in 10 years, will be less financially secure as a nation as a result of these critical choices.

So -- and as we've learned today, what you're proposing to spend, the nation would spend on military preparedness is not enough to do everything that needs to be done. So I just want to emphasize what I believe are the need to make some very critical choices in terms of how much money can we afford to spend on military and still have that level of preparedness that we need, and recognize that those decisions, every dollar spent there is going to be one dollar less somewhere. It's going to be less either for other domestic programs or it's going to be one dollar, as we have it today, in drawing down our Social Security and Medicare trust fund surpluses, which are going to impact our long-term security.

So, I guess my preamble here has exhausted my time, and I will be respectful of my time. But I do want to just leave -- conclude then with one question, and picks up on something that senator Inhofe said about Reservists and National Guard. I'm very concerned that since Minnesota has a large contingent of reservists and now National Guard participating in the inequities in the treatment of their pay and benefits to the active services. And I wanted to just ask if, in general, and you could give me more specific information, I can be assured that these pay and other benefit improvements which I commend you for, and your recommendations will include also the Reserves and National Guard to the same degree as the active forces?

SEC. RUMSFELD: Mr. Chairman, I just would like to make a brief comment. What you say, Senator Dayton, is of course correct. The weapon systems that are invested in in one period take years to be procured, acquired, developed, built, tested and deployed. When I was secretary of defense in the 1970s, I was involved in the roll-out for the F-16 and we still have. I approved the M-1 tank. We still have one. The B-1 bomber was in its earliest days. Every administration, every president, every congress has available to them to contribute to peace and stability in the world not what they do during their time in office but only what was done by their predecessors, and not simply their predecessors of four years or eight years, but their predecessors of 20 and 25. In the case of B-52s, 30, 35 years. That is a truth. Therefore, it's particularly important -- and I would add that there is nothing -- there is practically nothing that this administration will ask the Congress to invest in that will benefit this president during this term. The lags are too long. The times are too great. And the legacy forces we're living with and we're dealing with were the result of decisions made by congresses, and presidents that go back two, three, four decades.

SEN. DAYTON: I agree with that. I don't think anyone can contest it.

SEN. LEVIN: Thank you very much. Senator Bunning.

SEN. JIM BUNNING (R-KY): Thank you, Mr. Chairman. I'd like to associate myself with Senator Sessions' remarks. I'm sorry he is going. But I'd also like to go back to our success in Afghanistan. We combined our forces with the in-country forces -- the Northern Alliance, the Southern Alliance -- in assisting to running out the Taliban, and we did that successfully. I would (?) say that is a major accomplishment for the U.S. military. The U.S. military is capable of doing a heck of a lot more than just that. But I look at the al Qaeda results and the terrorist results, other than the destruction of training camps, and I look at the main people that are in charge, and you can't tell me today whether they're alive, or dead, or where they're at. And if we're going to spend a billion-plus dollars a day, we ought to be able to do that. We ought to know one way or the other if Osama Bin Laden is in Somalia, or if he's in Iraq. Or we ought to know where his second of command is. Most, it seems like, al Qaeda leadership escaped, and now you're shaking your head, no, that isn't true. Maybe you know more than I do, because I -- no? Well, most of it seems to have escaped and left Afghanistan, and are in other countries, planning destruction again. And we ought to be able to centralize our forces with others to make sure that that doesn't happen. You have come to us to ask approval of almost $380 billion worth of expenditures. I'd like to have a little more assurance that you're going to finish the job that you started after September 11th.

Let me just give you one example that's in the budget that I have difficulty with. you said you were going to centralize aircraft, and the F-22 was going to be an aircraft that the army, navy and any other force could use. Now, you've requested in your budget additional aircraft for each and every service. And maybe you can help me out. Is it because it's available? Is it because the F-22 is down the road too far? Why are you requesting, when we were going to go and get a unified aircraft that all the services could use, why are you requesting money for additional planes, as you just discussed, even the unarmed -- or unmanned planes, you just talked about that. But I think we ought to have, in spite of the fact that we were successful with the Taliban -- tell us more. Where are we going?

SEC. RUMSFELD: Thank you, senator. I'll take a stab at it. I think it may be a little early to describe the situation in Afghanistan as a success in this sense. You are quite right the Taliban is no longer governing that country. But there are still pockets of Taliban there. There are still al Qaeda there. And there are still al Qaeda and Taliban over the borders of that country, and it is still a very dangerous situation. It has been I guess four months since September 11th, and it's been a month less since October 7th when General Tom Franks and the Central Command began the operation in Afghanistan. It is not over. I wish I could say it was over in Afghanistan --

SEN. BUNNING: I didn't say it was over. I just would like --

SEC. RUMSFELD: I wish I could say it is over. It isn't. And we have work to do still. The difficulty of -- first of all, the task in my view has been to put enough pressure on terrorists and countries that harbor terrorists that they have difficulty recruiting, financing, organizing and engaging in terrorist acts. Now, I don't doubt for a minute but that you are right that they are out there planning additional terrorist acts right now. I agree with that. I would say that the pressure that has been put -- not just by our country, but by countries across the globe, through law enforcement and through pressure on their bank accounts, and through the pressure in Afghanistan and in other places, is making life very difficult for them, and making it a lot more expensive for them to try to do their planning. And we have disrupted things.

With respect to the aircraft, the -- it is the Joint Strike Fighter that was to have the version for each of the services, and the F-22 is earlier in the queue and is an Air Force aircraft. Possibly General Myers would want to comment on it. But I think that we will find that when the Joint Strike Fighter moves through its paces and its tests and its funding, and is finally brought on line -- when is that supposed to be, the Joint Strike Fighter, do you recall?

MR. ZAKHEIM: We are only just getting started. I think it's about --

SEC. RUMSFELD: It's in the very early stages.

MR. ZAKHEIM: I think it's about 2010, sir.

SEC. RUMSFELD: Something like 2010 for the Joint Strike Fighter. That is the aircraft that would have a version for the --

SEN. BUNNING: Each individual services?

SEC. RUMSFELD: General Myers?

SEN. BUNNING: Let me -- no, I want to hold on with you, just because my time is almost expired. It was brought up before -- Iraq, Iran, North Korea. When do you act when you absolutely know that they have weapons of mass destruction, and they are capable of delivering them?

SEC. RUMSFELD: Senator, those are judgments for the president and the Congress. There is no question but that countries that have weapons of mass destruction and are capable of delivering them, and are active as a terrorist state so to speak, and have relationships with terrorist networks, there is no question but that they pose a threat to the world. And the president's State of the Union message and his comments I think underline that very clearly.

SEN. BUNNING: Thank you.

SEN. LEVIN: Thank you, Senator Bunning.

Senator Reed.

SEN. REED: Thank you, Mr. Chairman. Secretary Rumsfeld and Secretary Zakheim, Chairman Myers, thank you very much -- not only for your testimony this morning, but for your distinguished leadership in very difficult times, and leadership that is not only a function of the confidence, but also great character, and I thank you for that.

SEC. RUMSFELD: Thank you.

SEN. REED: Like many of my colleagues, I had the occasion to travel to the theater of operations to visit troops in Afghanistan. And, General Myers, I share the same, and Mr. Secretary, the same deep respect and profound regard for what they have done. I must say also I am particularly pleased at the leadership provided by some of my classmates. General Hildebrandt of the 10th Mountain Division and General Daley (ph) in the Special Operations Forces, and a near classmate, General Cody, in the 101st. Obviously the sorting system works very well in the Army -- they are commanding divisions, and I am here. (Laughter.)

But one concern I have is that we are reaching a critical set of decisions about the follow on to our very successful military operations. We have all pledged a long-term commitment to Afghanistan. But I think there is reluctance, perhaps caused by political aversion to the notion of nation-building and committing our forces, to detailed planning for a military transition. The military international force is scheduled for about six months. The British are commanding now; the Turks would like to take over. But my fear is at that point -- at some point in the near future, in a few months, we will run into a situation where we have not made effective transition. And I would say in that context any international force must rely upon the United States to participate -- perhaps not putting troops on the ground, but logistically, intelligence, coordination with Central Command.

And, Mr. Secretary, I guess the question comes down to this: Are you convinced that detailed planning is under way for a smooth transition, sot hat we won't find ourselves in a situation where forces are drawn down, international components refuse to cooperate, or we don't have effective coordination with those forces?

SEC. RUMSFELD: Senator Reed, thank you. The question is truly an important one. What we have done is the president and I and General Myers have asked Central Command to send a modest team in to do an assessment, with Fahim Khan, the interim defense minister, and with the Karzai interim government, to take a look at the proposals that are existing -- and they are plural at this stage -- for an Afghan military, a national military, as opposed to what we have now, where we have these different war lords with forces that are left over from the anti-Taliban effort. And that work is starting immediately. There are a variety of ways of approaching it. I don't know what will be decided or what will be recommended by this assessment team, but I do know that they are going to be coming back to General Franks, and then General Franks will be coming to General Myers and to me, and then ultimately we will go to the president.

We have every intention of trying to be very helpful in the development of a national Afghan army. It is -- it could be a big help to us if they had such a series of units that could then go out and help us track down the Taliban and al Qaeda pockets. They could do a better job on the borders. That could contribute to stability in the country. That's one piece of the answer to your question. The other piece is the international security force. And that is of course unnatural to have foreign forces in your country on a long-term basis. So the preference is to try to see that the Afghan government develops its own ability to provide for stability in the country, recognizing, as your question does, and as we do, that that's not likely fast, that there therefore is a need for the international security assistance force. You correctly point out that we are involved in it. We are assisting with intelligence, logistics, with quick-reaction force in the event there is a problem. We are already working with the United Kingdom as the lead during the interim period to develop the country that will become the lead when the U.K. steps out. I don't know over what period of time the U.K. will continue to lead, but they are a very responsible military and country. I have every reason to believe that they will manage the transition to the new leader, whoever it may be, whichever country it might be, in a proper way, and that we will be working with them to try to see that the requisite number of ISAF forces are available.

It is a very dangerous country. You -- many of you know -- you have been there. There's a lot of land mines, there's a lot of criminals, there's a lot of leftover Taliban and al Qaeda. There are people getting killed, and it requires a security force. And we are at the task that you have cited.

SEN. REED: Mr. Secretary, it seems to me that the tasks that you have indicated are not going to be accomplished within a few months -- perhaps not even a few years -- and that we have a situation where we are implicitly committing to a multi-year stay, but we only have an international force that has been stood up for about six months, and maybe a little beyond that. And I think that disconnect not only will cause operational problems down the road, but also it undercuts our statements that we are there for the long term. And I -- as long as you have a sort of a notion that you can make public of a consistent ongoing support for this international police force, or international military force, I think that would be helpful on two fronts.

And I notice -- I would like you to respond, but I notice my time has expired, and I will --

SEN. LEVIN: Could we get a brief response?

SEC. RUMSFELD: Yes, sir. I think when you use the phrase "we are there for the long term," I think we are as a relationship with the Afghan government. I would not want it thought that we are there from a military standpoint for the long term, because those are judgments that have to be made down the road, and obviously we have a good deal of other demands on our forces. And that's why we were so pleased that the Brits took up the International Security Assistance Force, and that the people are stepping forward now to develop their own force.

SEN. REED: Thank you, Mr. Secretary.

SEN. LEVIN: Thank you very much. Senator Allard.

SEN. ALLARD: Mr. Chairman, thank you. Mr. Secretary, I would like to compliment you on a very, what I would say a courageous budget. I know it's not easy to put together this kind of budget. We talk about flexibility and mobility in our armed forces, but we don't talk about flexibility and mobility perhaps in a more fundamental aspect of this process, and that's the budget, where you have to look at some older programs that perhaps don't serve us too well, and look at newer programs that perhaps there isn't much of a constituency in the Congress. So, on that basis, I think you have put forward a very courageous budget.

I have also noted that when the -- on the space commission report you talked about the vulnerability of U.S. space assets. At your nomination hearing you reiterated your concerns about it. And then again last week you again talked about protecting our space capabilities from enemy attack. And I think that's one of those areas that we have to be vitally concerned about. And I think that Senator Sessions in his question properly brought out that issue. And perhaps maybe you would like to elaborate a little more. I just want you to know that when we are talking about space-based radar that I would like to do whatever I can to help to make sure and support you in your efforts, because I view that as very, very important in moving forward with modernizing this country's defenses.

I do have a question also for General Myers. And I understand you are still in the process of modifying the unified command plan, and the new plan will include a Northern Command to address the military functions of homeland defense. Can you give us some insight into the new command, and especially in regard to those functions currently assigned to NORAD?

SEC. RUMSFELD: Given the fact that General Myers is the former commander, combatant commander of -- a CINC of Space Command, I think I may ask General Myers to answer both those questions.

GEN. MYERS: Senator Allard, good afternoon. You are right, what the secretary has done is implement a lot of the recommendations out of the space commission. And I think the '03 budget goes a long way to fixing some of the problems we had in some of our space systems. We were putting a significant amount of money into our surveillance capability, which is the first step in ensuring that we can protect the assets that we have in space. So that's part of the '03 budget that you have either seen or will see.

In terms of our space-based communications, as I think most everybody knows, we rely mostly on commercial communications capabilities in space for most of our needs. But for the 20 to 30 percent that we think must be indigenous to the Department of Defense, we have fully funded those programs, in programs like the advanced EHF program, the follow on to our so-called MILSTAR system; the Navy MULS (ph) program, a follow on to the UHF program -- have both been fully funded in '03 and in the outyears, so that we can deploy the appropriate constellations.

If my memory serves me right, there's just about 90 or 91 million dollars in the '03 budget for space-based radar, and that's to prove the technology and the cost effectiveness and the military utility of such a system. I think it's time we get on with that and demonstrate its capabilities, and see its military worth. This is a system that if it comes to fruition, as we think it will, will give us the kind of persistence that we have talked about, even in Afghanistan. One of the things that Predator gives us is persistence over the battle space -- we are able to stay on station for long periods of time, and surveil. What we want to see -- I can go back to my Vietnam days when we were -- we had our reconnaissance aircraft, and that was primarily how we got our intelligence. And the reconnaissance aircraft would -- they'd have a sortie in the morning, and they would have a sortie in the afternoon, and those were two snapshots in time. A lot of things happened before they got there and after they got there, and before they got there again and after they left. And with systems like space-based radar you have the potential of course to have this persistence. So I think this budget has gone a long ways to reiterating some of the concerns we have had in the past about some of our space assets.

In terms of the -- I'm sorry, on space-based radar, I said 91 million -- I think it's 48 million in '03 -- I was corrected by I think Dr. Zakheim. My memory didn't serve me right, as I thought it had, which is not the first time.

In terms of the unified command plan, anything we say has to be -- has to be modified with the fact this has not gone to the president yet, and so he has not approved this plan. But the basics are -- the basics of a new Northern Command, if you will, that would focus primarily on the defense of the continental United States and our neighbors would be this -- there are really three parts of it. One of the parts would be the NORAD piece. NORAD already does the air sovereignty piece, it does the space warning and so forth. It would be a piece of this new command. In fact, the proposal is that the new unified commander would be dual-hatted as commander in chief of NORAD as well. And, as you can imagine, we have started our discussions with our Canadian partners in this, and they understand that and are fine with that.

We blend two other things with this new command. One is the support that the Defense Department traditionally supplies in times of other natural disasters -- hurricanes, floods, forest fires. So that support right now goes to the secretary of Army, and that would be something else this new command would worry about. And the third piece is what we have already stood up, which is Joint Task Force for Civil Support. And these are people who are trained to respond to chemical, biological, nuclear or major explosive incidents in the United States, as support to the lead federal agency -- or maybe it's the lead city agency or state agency -- but as support to that. So those are the three main pieces: the NORAD piece, the natural disasters, and the response to chemical, biological, nuclear or explosive. And we will propose that to the president, and see how he disposes. And then we have about less than a year now, but we would like to stand this new command up on 1 October of '02. We have time to work through the implementation plan. And that's where we are.

SEN. ALLARD: Mr. Chairman, I would like just 30 minutes just to summarize --

SEN. LEVIN: Thirty seconds.

SEN. ALLARD: Thirty seconds -- just to summarize -- (laughter) -- I tried. (Laughter.) You know, I think Senator Byrd asked a very pertinent question, that with this defense, what is our world going to look like. I think that the answer is obvious if we phrase that question a little differently: What would this world look like if we don't move ahead with this budget? And I think the answer is very obvious. We know what it is going to look like, if we just look at New York. We know what it is going to look like if we look at the Pentagon. And we know what it is going to look like if we look at every American's life and the impact that the attack of September 11th has had on American lives. Thank you, Mr. Chairman.

SEN. LEVIN: Thank you, Senator Allard.

SEC. RUMSFELD: Senator Allard, thank you. I think that's a very important observation. I would add one thing on the unified command plan. Not only have we not presented it to the president, but until we get his okay, then we begin the process of discussing it with our NATO allies, because they are involved -- with Canada and various other parts of the world where the adjustments are going to be made. So it's going to be a process that is going to play out over a month or two I think.

SEN. WARNER: And you are going to consult with us. I saw you make that clear.

SEN. LEVIN: Senator Carnahan.

SEN. CARNAHAN: Thank you, Mr. Chairman. I recently returned from a visit to Central Asia, along with several of my colleagues on this committee, and we visited the theater of operations. And I was very impressed with the level of morale and the spirit of our troops. As one of them told me, We know why we are here. And I think what we see here is not only a testament to these young people, but also to our military leadership, and to you, Mr. Secretary, because you have given us the steadfast leadership, and you have had an innovative -- you have innovatively conducted this war, and we thank you for what you are doing for our country.

SEC. RUMSFELD: Thank you very much.

SEN. CARNAHAN: I am looking forward to working with you in funding and fighting and winning this war on terrorism.

There have been a number of questions asked today, so I will go to one that has not been addressed. I recently wrote you a letter, and I shared my concerns about the emerging threats to the United States in Central and Eastern and Southeastern Asia, as well as Eastern Africa. And I pointed out that Navy fighters and long-range bombers are the only aircraft that can reach these areas of concern easily. We all know that the FA-18C flew the bulk of the U.S. Navy strike missions in Afghanistan. And so I believe it's important that we sufficiently fund their maintenance, and continue to modernize their capabilities. The Navy is currently in a multi-year contract to procure the next generation of F-18s, the E-model Super Hornet. However, I was disturbed that the president's budget cut the number of Super Hornets to be purchased in the year 2003. Given our future needs for tactical aircraft, it would seem to me that we should be increasing our capabilities rather than cutting them. I was wondering what your rationale is for this and if you would comment on that.

SEC. RUMSFELD: Yes, indeed, Senator. The secretary of the Navy, of course, is going to be here next week, and he and the chief of naval operations will be delighted to discuss it in some detail. What took place was a decision that the F-18 is in full production until the joint strike fighter comes out. It's a program that is supported by the United States Navy.

You are correct, of course, that the numbers they're looking at are 44 instead of 48. On the other hand, the O&M accounts, the maintenance piece of it is, we believe, fully funded. And, like always, choices had to be made, and the Navy concluded that this was the appropriate thing for Fiscal Year '03. And it shouldn't in any way suggest any lack of support for the aircraft.

SEN. CARNAHAN: So you're saying there is not a possibility, then, that these other four would be built.

SEC. RUMSFELD: I think that at the moment it looks as though the Navy and the department have made their judgment, and the judgment is that they wanted to fully fund the maintenance accounts, and therefore this particular number, 44, is what fell out of all the choices that they had to make. And that's our recommendation.

SEN. CARNAHAN: Thank you.

SEN. LEVIN: All set? Thank you, Senator Carnahan. Senator Roberts.

SEN. PAT ROBERTS (R-KS): Yes, Senator Levin.

SEN. LEVIN: You are next.

SEN. ROBERTS: I thank the distinguished chairman. Mr. Secretary, in our war on terrorism, where do you see the DOD headed as far as something called preemption is concerned? If we're worried about the weapons of mass destruction and those states that would produce or develop that capability, use that capability, it would seem to me we would be prepared or we should be prepared to take preemptive action rather than risking absorbing the consequences in the attack that we've all seen.

So, within the limits of security in this session, do you see the need to increase our intelligence capability, our precision weapons -- pardon me -- our precision-weapons technology and the use of special forces to militarily preempt a potential attack on the U.S. using any weapon of mass destruction?

SEC. RUMSFELD: Senator, you asked where is the DOD going? I think the answer on preemption is really more where is the country or the president? And the DOD is going to go where we're told. And you're right; the problem of terrorism is a unique one. It's distinctly different in the sense that you cannot defend everywhere at every time against every technique.

Therefore, you have no choice, in the case of terrorist acts, particularly with powerful weapons, but to go after the terrorists where they are. And as the president has said, states that harbor terrorists and facilitate them and finance them are every bit as serious a problem.

We have increased, in this budget, intel. We have increased precision-guided munitions. We have increased, I believe, funds for the special forces.

SEN. ROBERTS: Special forces.

SEC. RUMSFELD: And we recognize, as you do in your question, their importance in the distinctly different kind of a world we're living in.

SEN. ROBERTS: We need an assistant secretary of Defense for special operations and low-intensity conflict. We've been saying that on the Emerging Threats Subcommittee since '99. Can we expect one in the near-future? We don't have a nominee for that important position. It's been about a year. I'm not complaining. You have to make the right choice; I understand that.

SEC. RUMSFELD: We had a -- as you know, the nomination process is a long and tortuous one, and we have had a couple of people move along the path part of the way and fall off, for a variety of reasons. We do intend to fill it, yes, sir.

SEN. ROBERTS: On the weapons of mass destruction, on the civil support teams, they used to be called (raid?) teams. Now they're CST teams. We tried to get an acronym with Senator Stevens and Senator Byrd involved so we could get it appropriated, but we couldn't come up with the right acronym. If you could suggest one, that might help. (Laughter.)

We have 22 full-time National Guard personnel, and now there are 32 of these teams authorized. Do you support establishing a team in every U.S. state and territory?

SEC. RUMSFELD: It's not a question I've personally addressed.

SEN. ROBERTS: That's one where you'd be four hours from anywhere, from any incident, regardless of what kind of threat would be involved to inform the team in Washington, albeit first responders, who would have the first responsibility, exactly what they're dealing with, and it to be highly-trained -- it would be a mission for the National Guard.

Are we going to examine whether or not the Russians, with their expertise with anthrax and other biological pathogens that they actually produce, can be tapped into by the CTR and the DOD programs to address our homeland defense needs?

SEC. RUMSFELD: With respect to the first question, Dr. Zakheim tells me we currently have 22 of those teams.


SEC. RUMSFELD: And your question is, are we going to go to 50?

SEN. ROBERTS: We have 22. They're authorized up to 32. We're going through the training. We had a GAO report that was not too kindly; one of those again. And so there has been an effort to say we need them in all 50 states. That was the goal; no special time frame.

GEN. MYERS: Senator Roberts, I just think that's one of those things that we need to look at as we start up our new command. That's one of those things in the implementation study.

SEN. ROBERTS: Do changes in the military transformation include the intelligence community and their ability to rapidly collect and analyze, in a very threat-rich environment? In view of the fact that many of the enemy combatants in the war on terrorism may be within our borders of our country, how will the military intelligence have to change to be able to receive information? And specifically I'm talking about FBI, CIA and the DIA; very strong relationship. Can we get some courses in our various military schools to get us updated on that?

SEC. RUMSFELD: Well, that's certainly a worthwhile suggestion, Senator. I have been heavily focused on the non-homeland security piece, and Deputy Secretary Wolfowitz has been very heavily focused on the homeland security piece, along with the secretary of the Army.

I have, however, observed, in an awful lot of meetings, the fact that you point out the importance of fusing the intelligence information among the various agencies. And I know for a fact that the Defense Intelligence and the Central Intelligence Agency has a relationship that I would characterize that's closer than I've ever seen in my experience.

I have watched the Department of Justice and the FBI improve their linkages with the Central Intelligence Agency and with the Defense Department. And I don't know that we've got the answers to this, because it is complex. And the FBI data tends to be decentralized out in the regions, as opposed to centralized, which makes it quite difficult to have the kind of fusing of intelligence and knowledge.

SEN. ROBERTS: Well, their mission has changed as well. I was suggesting some specific education for the military leaders that are service war colleges and the National Defense University.

I have one last question, if I can, Mr. Chairman, even though I've got the blue slip. Where are we going with NATO? We've had an excellent speech by Senator Lugar, pretty much saying that under the strategic concept of NATO that was adopted two years ago, my goodness, if we don't have terrorism in the laundry list of things that we ought to be worried about numero uno, what is going on?

We had a delegation that came back, some sparks there, some meaningful dialogue. I remember two years ago. NATO is now in charge of things like crime and drugs, ethnic cleansing, environment, economics. I even said, "Don't put gum in the water fountain." I got a little bit upset about that in terms of the original purpose of NATO. Now we see some hesitancy on the part of NATO; at least that's in the press.

Under Article 9, if NATO is not going to atrophy and if NATO is going to mean something, certainly we're going to have to have NATO take a very strong stance on terrorism, more especially with the terrorists within their countries. Where are we headed there? We're going to have NATO expansion coming up, and we're going to have a hearing on that here fairly quickly, and I'm very worried about it.

SEC. RUMSFELD: Senator --

SEN. LEVIN: Give us a brief answer on that, because we are over on that round.

SEC. RUMSFELD: Yes, sir, Senator. There's no question but that NATO is attentive and should be attentive to the problems of terrorism. It is something that they have addressed in each of the two meetings that I've been to at NATO. I'm aware that they have invoked the article of the NATO treaty involving -- it's Article 5 -- that attack against one -- and it was a terrorist attack -- is an attack against all. So I quite agree with you that they do need to focus on this, because that's part of the world we're living in.

SEN. ROBERTS: Okay. Thank you, Mr. Chairman.

SEN. LEVIN: Thank you, Senator Roberts. Thank you again for the leadership which you showed over the years in the Emerging Threats Subcommittee leadership.

Senator Nelson.

SEN. BILL NELSON (D-FL): Mr. Secretary, my compliments to you. You're talking about the renewed cooperation with all of the intelligence agencies and how you have put it together for highly- visible events such as the State of the Union or, this past weekend, the Super Bowl. My compliments to all of the agencies involved, which was a combination of state, local and federal.

A delegation from this committee was the first to go into Guantanamo. What I was intrigued to find out, that reporters from Europe, in the press conference afterwards, actually wanted to argue with my conclusions about the humanitarian treatment. And yet what I tried to say was that the most important purpose that I had there was to see if we were getting information from the detainees.

And I take this occasion to tell you that our codel had concluded that we were not getting that information quickly enough. Now, I know you followed our trip by a couple of days. They were just completing that wooden housing that was going to be air conditioning where two per structure could go through what they call the screening process.

But up to that point, they had not received that much information. And I expressed in the press conference that I thought that that would accelerate by virtue of these new facilities that they could move into. Would you comment briefly on that, what you observed and what you know now?

SEC. RUMSFELD: Yes, sir. I saw the screening rooms. They did have -- they were completed. They were air conditioned. They were planning to start the next day with individual detainees for discussions. I have a feeling that your trip down there urged them on.

I think that you're quite right. It's enormously important, if we're going to do everything humanly possible to protect this country and our deployed forces and our friends and allies from additional terrorist attack, going through that process of knowing what those detainees know is just enormously important and time-sensitive.

SEN. NELSON: Now, while I was there, we had our commanding officer stepping in for Pete Pace as the CINC Space; as I recall, a two-star general. And it's my understanding, earlier here today you were talking about the importance of the selection of the CINCs. Can we expect a four-star CINC to be appointed so that that's not a vacancy there, given your remarks earlier in this hearing?


SEN. NELSON: Good. Good. And the quality of that and what it means to Latin America, I mean, to have an officer like General Pace; you know, that was an excellent choice, and obviously you recognized that by bringing him up here.

SEC. RUMSFELD: (Laughs.) We did, indeed. And he's doing -- Dick Myers agrees -- he's doing a wonderful job for the country.

SEN. NELSON: I believe so, too. Earlier you said that you're talking about taking NORAD and putting it under the new CINC for homeland security. What does that do to CINC Space?

SEC. RUMSFELD: The details are still being worked out, and they have -- we've not fully briefed the Congress. We've not presented it to the president. We've not gone through discussions with Canada completely. I know you've talked to the chief of the defense staff, and I've mentioned it briefly to the minister of defense of Canada. But we want to tell them at least what the tentative --

GEN. MYERS: I think the theory here that the secretary asked us to drive on is to, as much as we can in the new unified command plan, to focus people on their primary mission. So what it does in the case of the Space Command is it doesn't dual-hat potentially the U.S. commander of U.S. Space Command any longer. He does not have the NORAD responsibility.

That will be the new NORTHCOM, supposedly. And so he'll be able to focus or he or she will be able to focus on the task at hand, and that is the space mission as that continues to grow and evolve. And so that's kind of the rationale behind it. That's where the secretary was pushing us.

That also occurs in Joint Forces Command, which is going to be our change agent for transformation, experimentation, joint training. The Joint Forces Command commander today has several hats. One of those is the responsibility for this Joint Task Force Civil Support, which would then again come under NORTHCOM; so, again, to focus Joint Forces Command on what we think the most important task is, and that's the rationale, sir.

SEN. LEVIN: If I could interrupt just for one second also, Mr. Secretary, to remind you that the Congress has got to be on that consultation list prior to the decision in this area.

SEC. RUMSFELD: Yes, indeed.

SEN. NELSON: And, Mr. Chairman, just -- I would conclude by suggesting to the secretary and the chairman that you may want to take a look at a budget that is not your budget, but it's going to have profound effects on you.

I believe, unwisely, that the NASA budget is being savaged. There is a 13 percent reduction in human space life. And the reason this is important to you, the proposal is to take the launch of the space shuttle down to four. That's almost cutting it in half. The inevitable result is that you get rid of a good part of that launch force.

And how this affects you, Mr. Secretary, is that if we were ever to have legitimate threats or be down on some of our expendable launch boosters and/or pads, your only assured access to space is the shuttle. You might crank that into your thinking, even though it's not your budget.

SEC. RUMSFELD: Thank you, Senator.

SEN. NELSON: Thank you, Mr. Chairman.

SEN. LEVIN: Thank you very much, Senator Nelson. Senator Collins, then Senator Cleland.

SEN. SUSAN COLLINS (R-ME): You saved the best for last, right? Mr. Secretary, I want to join with my colleagues in applauding your extraordinary leadership in the war against terrorism. And I thank you, General Myers and Secretary Zakheim, for being with us today.

Last month I was a member of the bipartisan delegation, that several of my colleagues have referred to, that journeyed to Central Asia. It was a wonderful opportunity not only to meet with the leaders of the countries involved in our coalition against the war on terrorism, but also to meet with our troops first-hand and hear their impressions. And I was so impressed with their high morale, their patriotism, their professionalism, their skills, their training. It truly was an inspiring trip for me.

I also learned a great deal more about the absolutely critical role that our Navy has played, particularly our carrier battle groups, in launching operations in the war in Afghanistan. I fully realize and understand that the administration has inherited very serious budget and program shortfalls affecting ship-building. But as you know, I share the concerns that many of my colleagues have mentioned today that the budget before us does not restore ship-building to the levels that will sustain a 310-ship fleet, nor our industrial base.

My concern is that there seems to be a pattern in which the department sincerely plans and hopes to increase ship construction rates in future years, but then ends up scaling back the plans when funding runs short.

So I'd like you to comment on the commitment of the department to maintaining an adequately-sized fleet. And I realize that there may be dispute about exactly what the numbers should be, but I think there's widespread agreement among the experts that we've been heading in the wrong direction in future years. And my concern is that if we don't start this year, and instead only proceed with five ships this year, that we're just going to fall further and further beyond.

SEC. RUMSFELD: Senator Collins, thank you so much. And I know -- I'm delighted that you have been, and I knew you were, out visiting the troops and how important it is to them, and we appreciate that.

The ship-building part of the budget is a real dilemma for me, because it's a matter of tough, tough choices that have been made in the Department of the Navy as to what they thought made the most sense. They all agree with what you said, that the straight-line projection, if you go at five or six, even seven ships a year, is going to take you to an unacceptable level of the Navy. Everyone agrees with that. Whether they think the Navy ought to be 280 or 300 or 340 or 360 ships, they all know it ought not to be down where it would go if we stayed at this particular level.

The task they had was to figure out where you get the funds to do these O&M accounts, which they think are enormously important, to deal with the aviation piece of the navy, to fully fund the overruns that -- from past shipbuilding that need to be added in for this year that were unexpected, of something in excess of $600 million, and still make a rational choice with respect to the number of ships. And the judgment they made, as I understand it -- and Dov was involved in the decision with them -- was that the average age of the navy's ships today is sufficiently low that we're not going to be dropping -- we're not going down on a straight line projection -- we're going to be able to go like this for a period.

Now, you then go off a cliff, as you suggest. And we've all seen that forward year projections tend to look better than reality. And all I can say is this year, '03 is an awful lot better than the forward year for projections from three or four years ago. So, I don't -- I have confidence that these forward year projections for '04, '05, '06 and '07 are going to play out and that there is a very broad and deep feeling in the department and in the administration that you're exactly right, that we simply have to increase the number of ships in those out years, and we plan to do it.

SEN. WARNER: Senator, will you yield me two seconds --

SEN. COLLINS: Certainly.

SEN. WARNER: -- because I've been in this shipbuilding business I guess about as long as anybody in the room. Look at the R&D for the DV, former 21, now DVX. It's almost $1 billion each fiscal year for the next three fiscal years. Now while that's not in the shipbuilding count, as such you cannot lose sight of that, and that's a contract, I think, you will have a great deal of interest in, as you had in the past and the future.

SEN. COLLINS: You're certainly correct about my great interest in that contract. And I see the R&D for that account as benefitting now a whole family of ships, given the change in direction.

General Myers, I visited the U.S.S. Theodore Roosevelt as part of my journey. And the battle group had been at sea for 113 consecutive days when we visited the aircraft carrier, and that was because of security and mission requirements. I'm told that normally they would be going into port every 14 days. So, this obviously has caused a lot of strain. But again, morale was very high. But the operational tempo, the briefing that we got was truly extraordinary. Could you comment further on the heavy use of our naval platforms in the war against terrorism, and the impact of increased deployments on our naval forces?

GEN. MYERS: You bet, Senator. I also visited Roosevelt, and I think as of today, they are over 135 days deployed, because, as I mentioned in my opening statement, we are a nation at war, so we are asking an awful lot of our -- all our people, and our sailors are included in that group. But I too came away from my visit with -- it was just before yours, perhaps -- in fact, it was in December, so it had to be before yours, I believe -- of the high morale. They understood what they were doing. They understood the importance of it. There is nothing that the joint chiefs of staff or the secretary care more about than trying to maintain the operational tempo and the personnel tempo at acceptable levels, realizing that we are at war. So, this will be more difficult, perhaps, than in peacetime for sure, and that's part of what we're seeing.

What we're trying to do in terms of carrier deployments, though, is to stay on the global force presence policy that we currently have today, that they rotate on the schedules that the chief of naval operations has set up, and that we don't disturb that so we can have our naval assets ready for whatever comes next. And, so we will continue to press that very hard. It's very high on our list. It's something we talk about among the joint chiefs quite regularly.

SEN. COLLINS: Thank you, Mr. Chairman.

SEN. WARNER: Senior Democrat aboard, do you want to call on yourself there?

SEN. MARK DAYTON (D-MN): Thank you very much, Mr. Chairman. Mr. Secretary, General Myers, Doctor, thank you very much for your service to our country. I was just sitting here thinking for the last five- and-a-half years, I've been through two attacks on Saddam Hussein, the war in Bosnia, the war in Kosovo, and now the war in Afghanistan. I think one of the threats that certainly runs through our military engagements is the use of air power, particularly the use of high- precision weapons, and the evolution on the battlefield of unmanned vehicles for reconnaissance and surveillance, and also as valuable assets are AWACS and the J-STARS surveillance and intelligence and reconnaissance capability. And I've seen that increased to a very fine level.

And I appreciate your budget, Mr. Secretary, continuing to add to our capability in terms of battlefield intelligence and in terms of particularly our high-use of precision weapons. I do think that the combination thereof saves lives on the battlefield in our last two engagements -- in Kosovo and now in Afghanistan. I think we can be very proud as an American military that we've kept our casualties so low and our effectiveness has been very high.

Also, I see that your budget does another thing that tracks with the way we go to war, and that's the increased use of special operations and special forces. I think that this war in Afghanistan has in effect combined all three -- massive use of intelligence, unmanned vehicles to seek out that intelligence, tremendous use of precision weapons, and now a combination working with all that, the use of special operations and special forces.

Mr. Secretary, is there any doubt in your mind, since your budget certainly funds this to an increased level, these efforts to increased level, that this is the way we go to war now, and increasingly so?

SEC. RUMSFELD: Trying to look into the future isn't easy. I think there's a -- certainly a likelihood that you're right. I think that, however, we have to appreciate that the reasons that we have not been faced with large armies, navies or air forces is because we have such capable armies, navies and air forces, and the deterrent effect is what drives people towards these asymmetrical activities that we need to deal with. I think that the -- you're correct that the future is more likely than not to have -- no repeats of Afghanistan, but unusual situations -- let's put it that way. And we certainly cannot forget that North Korea has a massive army and is a country that is just terribly repressive to its people, and doing what it's doing with weapons of mass destruction. And there's no question but that Iraq has large conventional capabilities as well as an appetite for weapons of mass destruction.

So, I think what we have to do is what our new strategy suggests, and that's to look less at specific threats and more at the kinds of capabilities that are likely to come at us. And certainly when one does that, they're driven in the direction that your question suggests.

SEN. DAYTON: In terms -- thank you very much -- in terms of changes and transformation of the American military to a new world and a new environment, the leaner, meaner, more impactful and more mobile, may I say congratulations on the budget having money within it to being the transformation or conversion of some Trident submarines from a strategic role in the Cold War, which was role that provided for nuclear retaliatory response, to the conversion of some Trident submarines as tremendous platforms, stealth vehicles as they might be called, for more conventional use of high-level precision weapons -- cruise missiles, insertion of special forces and the like. I think that conversion of those Tridents really fits in with where we're headed.

Again, General Myers, thank you very much for your service. And may I just say, as chairman of the subcommittee on personnel, I'm pleased your budget includes a nice pay increase for the troops out there that are doing a tremendous job around the world. General Myers, every time I see you now I think about our moment together on the morning of September 11th, where we were together in my office at the very moment that the Pentagon itself was hit. And you've done a tremendous job. You came in under tremendous pressure, and congratulate you for your service, and thank you all very much.

Thank you, Mr. Chairman.

GEN. MYERS: Thank you, sir.

SEN. WARNER: Thank you, Senator. And we all remember your advances last year on behalf of the GI bill. I'm privileged to join you on that. It took four or five years, but I think it's going to be a retention asset.

If I might just say a few words before my chairman takes over, I noticed with great interest, Secretary Rumsfeld, that you listed among the threats to this nation is cyber-terrorism. And indeed, when I was privileged to be chairman, I started a modest program buried down in the sinews of your system whereby in return for educational benefits for young people who are willing to devote their lives at a university level in studying that subject, they would return to the federal service, presumably either your department or other departments and devote several years of obligated. That program that I started has slight growth, and maybe you might want to take a look to see if it couldn't be augmented a bit. I think it's going to work out quite successfully for you.

Also on the subject of spectrum policy, I'm privileged to have a number of high-tech operations in my state that are carefully following this issue. I had the federal -- the chairman of the Federal Communications Commission, Mr. Powell, up -- Mr. Powell, Chairman Powell, the other day. We went over it, and in due course, your administration in the Department of Defense will be working with the Commerce Department and other relevant agencies and departments in reviewing those allocations. But I know that you will of course have the emphasis on national security, but I do hope that there can be some flexibility for the private sector, which is really in desperate need of some additional spectrum.

And lastly, on the question of missile defense funding, I think we have an appropriate budget this time. Even though that risk seems to be de minimis in the minds of some, in my judgment, it would only take one to cause devastation of just unacceptable proportions to the United States, be it an accidental firing or one done in anger or by virtue of terrorism. So, I think you've stepped out very well on that.

Lastly, the military commissions -- it's interesting, you've got a study going on on the president's order of November 13th, and I hope that that comes out. I think we should go back and look at how that was done under our former chairman, Senator Nunn. Maybe at the time it was the right thing to do as these young men and women graduate from the academies, but I think it's something that should be looked at very carefully.

And thank you again. It's been a very good hearing this morning. I commend you, the chairman, and Mr. Zakheim. Job well done, gentlemen.

MR. ZAHKEIM: Thank you very much, Senator Warner.

SEN. LEVIN: Thank you, Senator Warner. Just a few questions to close up. First, on the proposal that will be forthcoming to establish a new unified combatant command for homeland security, do you think it is likely that you will be seeking a change in the posse comitatus law?

SEC. RUMSFELD: No sir. At the moment it looks as though the role for the U.S. military would be a supporting role. And we would -- we're involved in some very temporary activities that we have, as I indicated earlier, a way to move out of and exit. So, at the moment that is not something that the administration has thought necessary.

SEN. LEVIN: Let me go back, General, to the Philippines issue, just for a moment. One of the reports quoted or stated that the U.S. special forces commander, Colonel -- is it Friedrich -- am I pronouncing his name correctly? Well, the commander there said that U.S. soldiers would, quote, "take operational instructions from Filipino commanders." Do you know whether -- that is a quote -- is that accurate? Is that our policy?

GEN. MYERS: Senator Levin, I don't know if the quote is accurate, but it's not -- it's not the instructions that they've been given, that the command and control of U.S. forces will stay in a U.S. chain --

SEN. LEVIN: Including tactical control?

GEN. MYERS: Absolutely.

SEN. LEVIN: And the other -- which is not a quote, but a summary of what he said, is that if a U.S. soldier were captured, U.S. forces would defer to Philippine authorities before mounting a rescue operation. Is that accurate?

GEN. MYERS: Well, again, I can't talk to the veracity of the quote. I think on those kinds of tactical situations, we'd have to evaluate it. As the secretary said, the rules of engagement are the -- give you the right to self-defense. And I think we -- we probably shouldn't speculate on what would actually happen, but it doesn't sound totally accurate to me.

SEN. LEVIN: All right. On the -- the question has been raised about the status of detainees at Guantanamo Bay, and I want to ask about that issue. Am I correct that the president has not yet made a decision as to whether or not the Geneva Conventions apply to those detainees or has he made that decision?

SEC. RUMSFELD: I think the correct way to state it is that the United States, the president, I, have made a statement that we would apply the -- that the detainees would be treated as if it did apply, and they have been in the past, they are currently be treated such, and they will be in the future. The technical, legal question as to whether the president as a matter of law has decided is something that is being considered in the White House at the present time.

SEN. LEVIN: All right. Now, has, in this interim period until that decision is made, has the regulation of the Department of Defense, relative to enemy prisoners of war or retained personnel, civilian internees and other detainees, has that regulation been applied during this interim period?

SEC. RUMSFELD: I don't know that I follow the question precisely, but as I say, we have been treating -- we are now and we will in the future, regardless of what decision is made in the White House as to whether or not the Geneva Convention applies as a matter of law -- we have had a policy in the Department of Defense that we would behave and treat detainees that way. And they have been treated that way since the beginning and they are being treated that way today.

SEN. LEVIN: All right. The specific question, which maybe you'll need to answer for the record is the following question. We have an army regulation, 190-8, which says the following -- that if any doubt arises as to whether a person, having committed a belligerent act and having been taken into custody by U.S. armed forces, belongs to any of the categories enumerated in Article 4 of the Geneva Conventions, such persons shall enjoy the protection of the present convention -- and here's the critical language here -- until such time as their status has been determined by a competent tribunal. Then it says that a competent tribunal shall determine the status of any person not appearing to be entitled to prisoner of war status, who has committed a belligerent act or engaged in hostile activities, and who asserts that he or she is entitled to treatment as a prisoner of war, or concerning whom any doubt of a like nature exists so that under our regulations there's got to be a competent tribunal. And I'm not talking about the military tribunal --

SEC. RUMSFELD: No, no. I understand.

SEN. LEVIN: This is a different issue. And my question is, have -- is this tribunal been convened for any of the prisoners so -- any of the detainees so far?

SEC. RUMSFELD: My recollection of the details of the convention is that there is a very little definition as to the phrase "tribunal" as you're using it in this context. And --

SEN. LEVIN: In what sense, little definition?

SEC. RUMSFELD: That is to say there is no formal prescription as to exactly what would constitute such a tribunal.

SEN. LEVIN: No, no. It's very -- it's laid out procedures, the membership's laid out.

SEC. RUMSFELD: In the --

SEN. LEVIN: That's why maybe you better answer this for the record. But it sets forth the procedures. Members of the tribunal, the recorder shall be sworn; who the president is; a written record should be made of the proceedings; they shall be open except for deliberation; who the officers are. It goes through great details. And that's why, Mr. Secretary, rather, perhaps, than trying to answer this here now, if you could, if you feel better doing it -- if you could take a look at this regulation 190-8 and let us know for the record as to if it's being applied, and if not, why not. I think that may be a short way to do it.

SEC. RUMSFELD: Good. We'll do that for the record.

SEN. LEVIN: Is that okay? I don't mean to cut you short either.

SEC. RUMSFELD: No, that's fine.

SEN. LEVIN: Okay. The --

SEC. RUMSFELD: My comment, just for clarification, is when I said my recollection is reading the convention, not the army reg, is that the convention is quite open as to what that is, and that what we have been doing, so that the record will be clear, we have had a -- teams of people who interview these detainees and make a judgment about them. And there has not been doubt, in the sense that the convention would raise it, about these people, that I know of, and they have been then categorized as detainees as opposed to prisoners of war. I don't know that there's anyone who believes that they merit the standing of prisoner of war -- anyone in the administration or anyone I've talked to.

SEN. LEVIN: In other words that the -- oh, because I thought that the president was deciding whether or not they are prisoners of war legally.

SEC. RUMSFELD: No, let me clarify that. This is an enormously complex issue, for me anyway. The Geneva Convention we believe in very strongly. It's important, it provides protection for our soldiers, because our soldiers behave as soldiers -- they don't go around without uniforms or hiding their weapons or killing innocent people intentionally. The convention is a -- was designed among countries to deal with conflicts between nations, as you know.

The situation that we are in is that there is a technical question, a legal question, as to whether or not the United States should say that as a matter of law we believe the convention -- we interpret the convention to apply in the case of, for example, al Qaeda, which is of course not a nation -- it is a terrorist organization. It wasn't a party to these conventions in any sense. And the problem with doing that is that it could cause precedence that would be conceivably unfortunate. And it's sufficiently complex that the administration is taking its time to look at it. In the event that the convention were to apply, then one would look at lawful combatants and non-combatants and unlawful combatants. And they are very different. Non-combatants are civilians. And unlawful combatants don't merit being treated as prisoners of war. And lawful combatants, like U.S. soldiers or the soldiers of any other country, do merit being treated as prisoners of war. And in this instance it is very clear that these were unlawful combatants, and as a result there has not been much debate that I have heard that these people would rise to the standing of prisoners of war. That is not to say that the Geneva Convention doesn't apply. It could still apply as a matter of law. And that's the issue being discussed. There's three ways it could be tackled. One is the administration could say that they believe as a matter of law that the Geneva Convention applies. They could secondly say as a matter of law they decided it does not, or does not with respect to al Qaeda, or it does not with respect to Taliban. Or, third, they could say they don't need to address it, because we have decided to apply -- we have decided to treat the detainees as if it did apply, and we are not going to create a precedent by making a judgment. And it's those three options that are currently being considered by the White House, none of which would change their status as detainees. Nor would it change in any way the way they are being treated, because we are already treating them as if it does apply.

SEN. LEVIN: The question then for the record would be under our regulations that if there is a doubt that certain tribunals have -- a tribunal must be triggered. And that has been the question if this does not apply, let us know why it does not apply.


SEN. LEVIN: Because the stakes here are great, as you point out, but also for our own personnel.


SEN. LEVIN: I mean, we have got people who are not in uniform who are captured, and we want to make sure that they are treated properly as well. So how we treat people and how we are perceived as treating people, because those can be different at times. It becomes important in that regard too to protect our own people in circumstances where they may be captured not in uniform.

We thank you. Senator Grams.

SEN. GRAMS: Thank you, Mr. Chairman. Two questions, and then because of the hour I will be glad to take replies in writing for the record, or condense it now, whatever you prefer. The first goes back again to the reservists and National Guardsmen and women. As you indicated, Mr. Secretary, in your testimony, I believe some 70,000 reservists and National Guard have been called up because of the war in Afghanistan. I think they have been called up for longer periods of time as well. So the financial sacrifices which they are making become obviously exacerbated by those increasing lengths of time. So in terms -- and, again, I commend you for what you are doing to increase military pay and benefits. I just would like to know specifically what is being -- how will that apply to reserves and National Guardsmen and women?

SEC. RUMSFELD: I am advised that the pay increase applies to all. And just so the record will be very clear, the total number is 70,000. My understanding is -- my recollection is that it is something like plus or minus 60,000 Guard and Reserve, and it's a plus or minus 10,000 that are being retained in the service past their normal discharge date.

SEN. GRAMS: So here's -- your testimony implies that there is a targeted pay raise, 4.1 percent I guess is across the board that has been targeted for certain categories. Is there any targeting for the National Guard and Reservists? And also particularly given the fact that some of the housing and the other benefits would not apply?

SEC. RUMSFELD: I don't believe there is any targeting that would particularly apply to the Guard and Reserve, except what would apply to everybody. And my recollection is on the targeted you are right, it is 4.1 percent across the board. And my recollection is it is plus or minus two percent for certain targeted pay grades that are particularly in short supply and where we need to improve retention.

SEN. GRAMS: Thank you. And then, Mr. Chairman, one last question. After some meetings with actually the spouses of National Guardsmen and women in Minnesota and the spouses, presumably those were called up to provide the airport security, and because of the posse comitatus provision the president I think properly, from what I am told -- not a lawyer -- asked the governors to call up these Guards people so that for that purpose. So then we learned that because of that technicality they were not eligible both for some of the pay and benefits, as well they were not given protections that are afforded those who are called up by the president, particularly being evicted from rental or mortgage property, cancellation of life insurance, some other protections I won't go into them. Senator Wellstone and I introduced an amendment to the defense appropriations bill which was adopted in the Senate that would have addressed this. The Department of Defense at the time had concerns about that -- we were doing this in the last minutes obviously or hours of it. The House did not concur with that, so it was dropped in the conference report. I would just -- if you have any comments, fine. Otherwise, I would -- if the department has specific objections to those remedies for the next go- around, I would certainly like to work with you and -- but otherwise it seems to me there are no costs and just taking care of some basically inequities, and I'd ask if you would take another look at that please.

SEC. RUMSFELD: Senator, certainly the interest is a fair one. The decisions as to whether or not a guard is called up by the state or by the federal government is based on the function that they are to perform. And when the states call them up for state functions as opposed to federal functions, we have always felt, and continue to feel, that that therefore is a state responsibility, and that the state legislation would be the proper place to change those circumstances. It does appear externally to look like an anomaly. If we are called up by the federal system, they are treated X, and if they are called up by the state they are treated Y. But there is good reason for that: it's because they are basically fulfilling a state function.

SEN. GRAMS: I would agree, Mr. Secretary, and typically that's the case. I don't know if there's a lesson. This may have just been an aberration, this circumstance. But given the length of time they have been called up not, to the extent those inequities apply, to where there's essentially service at the request of the president or the urging of the president, it might be something to look at that is another one of these inequities that perhaps could be addressed, because the financial penalties they paid for their service have been very significant. Thank you. Thank you, Mr. Chairman.

SEC. RUMSFELD: And they've done a terrific job.

SEN. LEVIN: Let me thank our witnesses. Among your many extraordinary qualities is staying power, and we will stand adjourned. The record will be kept open for 48 hours. Thank you. (Sounds gavel.)