John [Hamre, President and Chief Executive Officer of the Center for Strategic International Studies and former Deputy Secretary of Defense], thank you very much. By now, I think most of you are familiar that I am often handed a speech shortly before I walk up to the platform. And take a look. It’s 25 pages long. And I say that even I cannot inflict this kind of cruel and unusual punishment upon you late this afternoon. [Laughter.]
I do thank John Hamre for inviting me. I’ve known John a long time. We worked together many, many years on Capitol Hill and then over in the Secretary of Defense’s office. And I know that you at CSIS have come to appreciate not only his intellect, but his great insight and especially his humor. On many occasions, when things seemed to be getting a little bit too heavy and the problems seemed to be a bit complex, John would lighten things up by saying, "This is like putting socks on an octopus." [Laughter.] Or, "This is like putting panty hose on a mountain lion."
And inevitably he was correct in diagnosing the difficulty of achieving any goal. But I must say that he was always very straightforward. He was blunt, honest, candid. And if you asked him to be anything but that, I would say it would be like trying to get an elephant to do needlepoint. [Laughter.]
In any event, I thank you for inviting me, John, and I hope that I will be able to contribute. Kurt [Campbell, former Deputy Assistant Secretary of Defense for Asia & Pacific Affairs], good to see you over here as well. Kurt Campbell did so much for us in the department in our relations with Asia. Great to see you over here, Kurt.
But John asked me to sort of paint my vision of the future in a broad presentation. He said, "It doesn’t have to be that deep. It could be sort of a light version of Jacques Barzun’s From Dawn to Decadence: 500 Years of Western Culture. And, of course, I hadn’t read it, so it sent me scurrying over the weekend to pick up a copy of the book. And I came across an interesting quote, John, in Barzun’s book. He said, "There are a great number of noblemen among you that are themselves as idle as drones, that subsist on other men’s labor, on the labor of their tenants, whom, to raise their own resources, they pare to the quick. Besides this, they carry about with them a great number of idle fellows who never learn any trade by which they may gain a living, and then, as soon as their lord dies, have turned out of doors. Those turned out of doors grow keen, and they rob no less keenly, for what else can they do?"
Now, I’m not sure why that caught my eye. [Laughter.] But as I look toward my departure from the Secretary of Defense’s position, perhaps [as] the traveler who was talking to [Sir Thomas] More [author of the previous quote] in Utopia, it had more than a subliminal message for me.
It has been said that whom the gods destroy, they first make prophetic. And I will try not to tempt that destruction aspect of it at least, but try to at least look at where we have been in the Defense Department and where we are today and where we’re likely to go tomorrow. I think it’s a fair statement for me to say that in terms of training and technology, versatility, mobility, lethality, education, and leadership, there is no peer, there is no peer to the United States military. And there is unlikely to be a peer to the U.S. military for the foreseeable future.
We have the best officer and noncommissioned officer corps. We have put the premium on our people, recognizing that even as we celebrate the capability of our technology, that that technology is rather useless unless we have the people who are capable of understanding it and utilizing it in the most effective and efficient fashion. So we focused upon our people. And as all of you know, it’s a very hard market out there for us to either recruit and then to retain the very best and the brightest in our society because of the strength of our economy and the fact that that private sector looks to the Department of Defense for some of its very best talent.
And so when John was Deputy Secretary of Defense, we decided that we had to do whatever we could to increase pay. And as you know, we increased pay with the largest pay raise in the past generation. We changed the retirement benefits from 40 percent to 50 percent. We changed the so-called pay table reforms so we could target additional pay raises to those in their mid-career level to make sure that we did everything that we could to provide the kind of incentives for the best and the brightest to stay.
And we achieved the goal that was set out for us a few years ago. Perhaps Pat Towell [senior writer for Congressional Quarterly] recalls from covering so many Senate hearings – [recalls the challenge] of achieving $60 billion in procurement. When I took over about three and a half years ago, we were down around $43 billion in procurement, and the goal had always been this elusive $60 billion. I made a pledge when I was sworn in that we would arrive at that $60 billion mark by 2001, which we have, in fact, done. And we’ll increase the procurement budget in the next four years up to $70 billion. In all likelihood, it will have to go even higher.
So we have done a good deal to focus on the quality of our personnel, understanding that we’re in a very competitive situation. It went without much notoriety, I might say, that last week we held a major press conference, supported by the Secretary of the Army [Louis Caldera], and pointed out for the first time in the past three years all three services met their recruitment goals. I don’t think any of you saw that in the Washington press. I think it appeared in one of the Texas newspapers [laughter] but it did not appear in any other publication that I’m aware of.
But that was big news. That was big news because we had been reading about the fact that we have been unable to meet our recruitment goals. Well, we’ve met them this year, for a variety of reasons. We met them because we decided to really put an emphasis on recruitment, to put our best people out in the field, to change our advertising techniques and to really make an effort to get out there and compete with the private sector for these young people. So that was good news, and I think there’ll be more good news in terms of our retention efforts yielding good dividends as well.
But there’s a mantra that you’ve heard me repeat so many times—shape, respond, prepare. The key has been the preparation. And I recall reading that George Marshall, when he was General Marshall, used to go out and ride a large chestnut horse on the banks of the Potomac. And you would think that he would do that for relaxation, to get away from the demands of his office. And when he was asked what he should call the horse, he said, "Call it Prepare." And that’s precisely what we in the Pentagon have had to do in terms of looking at our readiness and reform programs.
Readiness and reform are not something that achieves any static state of perfection. We are always in the process of trying to get ready, and also trying to reform ourselves, to stay contemporary and future-leaning. It requires constant attention.
The Navy, for example, is making great strides with its Fleet Battle Experiments. The Marines have been engaged in their exercises involving urban warfare. The Air Force, as you know, has restructured itself into an air expeditionary force in order to get more planning and more stability in their forces as far as predicting where they will be and when they will go. And, of course, the Army is in the midst of its transformation efforts to become lighter, more lethal, and at the same time remain survivable.
We’ve also seen the integration of the Guard and Reserve into the Total Force. I can tell you it wasn’t there three years ago. I can tell you that there was a point when the Guard would not even meet with our military, saying that, "We are treated as second cousins or less." And now they are an integral part of the Total Force.
So we’ve made great strides during the past three and a half years. Just a few years ago there was no lead agency for experimentation and development of joint doctrine and training. We now have a Joint Forces Command. Thanks to the leadership of John Hamre, we have something called the DRI [Defense Reform Initiative]. And as a result of that DRI, we are reforming our institutions and we have a Joint Electronic Commerce Program Office [to ensure electronic commerce in the Defense Department].
We’re changing the way in which we do business as well. We now are acquiring things electronically. We’re moving toward paperless systems. We have put an emphasis on jointness. We have a Joint Task Force for Civil Support [to advise and assist cities and communities in the event of a chemical or biological attacks on U.S. soil]. Some of you may recall it became somewhat controversial when it was suggested that perhaps we needed a CINC [Commander-in-Chief; a military combatant commander] for homeland defense, a commander-in-chief for homeland defense. And immediately there were questions being raised as to whether or not this would intrude upon the constitutional prohibitions of getting our military involved in domestic affairs as such.
And so we have a Joint Task Force for Civil Support for dealing with weapons of mass destruction, something that I want to talk about in just a moment. We have a Defense Threat Reduction Agency consolidating some of our agencies to make them much more efficient and effective [in our counter-proliferation efforts]. We have focused on cyber warfare, and we have that integrated approach now at Space Command. All of that has been designed to transform the military, stepping away from the 20th Century into the 21st. And I think we've made tremendous strides in that effort.
Last year had a chance to listen to a professor by the name of Clayton Christensen. Most of you have probably heard of him. He wrote an interesting book called, The Innovator's Dilemma: When New Technologies Cause Great Firms To Fail. And he talked at length in this book and in that presentation about disruptive technologies and pointed historically to the case where you take some of the major companies in this country of ours who are doing everything right. They had top personnel. They had great leadership. They had great flow of revenue. They were investing in research and development. They were trying to anticipate what their customers wanted. And yet they failed. And he talked about the need to anticipate how new technology or how disruptive technology can come in, not at the top end, but at the low end of the marketplace. And suddenly you have companies like Honda or Intel or Sony, when it first started out, suddenly taking over and dominating the marketplace.
And I thought this was important. This was an important book and an important presentation, and so I invited him to come to the Pentagon. We sat down with the members of the Joint Chiefs [of Staff], service secretaries and other policy people, and we spent three hours, almost four hours together, as he made a presentation. And I think that that was very instructive for all of the military leadership because we have to think forward [and] look into the future and say, "Who is it who’s going to challenge us directly? Should we be looking for some disruptive technologies, looking for somebody to come in at the low end of things to take the United States on?"
In terms of looking at the Internet, it may come as a surprise, but the Pentagon has something to do with the Internet. [Laughter.] But if you think about the Internet, it’s mostly English in content today. But one year from now, the number of Asians will surpass all of the Americans online. What does that mean in terms of the implication for a technological lead? So we’re trying to peer into that opaque window into the future. We take great pride in our superiority as far as technology is concerned, but we have to take care that that pride doesn’t become or turn into a sense of triumphalism or that we succumb to what I would say is the gravitational pull of the status quo.
I think of Desert Storm and Kosovo, two of the most recent battles in which we were clearly triumphant. We overwhelmed the Iraqi opposition in Desert Storm. We were enormously successful during Kosovo, where we had a 78-day air campaign with over 38,000 sorties that were flown, with two planes lost and no pilots lost in battle, a remarkable display of technology and professionalism.
But at the same time, we should not be complacent. If you think about the fact that we fought Desert Storm on an open, flat desert plain, as such, and that we fought Kosovo in a mountainous and largely rural area. But if you take a look at the demographics, by 2020, 60 to 70 percent of the world’s population will live in urban areas. And seven out of 10 of all of those urban areas will be on our coastlines or shores. That will change the nature of warfare and conflict in the future.
All of which brings me to the subject matter that John Hamre, I think, wanted me to talk about. I think, looking at our military today, again, we’re the best in the world. We certainly have some more challenges we have to address. You’ve heard the Joint Chiefs testify up on Capitol Hill in terms of where the shortages are. But you have to take into account where we were just three and a half years ago, when I became secretary of Defense.
I was handed a budget, and the highest number [for defense spending] that was agreed between the president and the Congress was $250 billion. And I was told, "This is what you’re likely to have for the foreseeable future, and you’ll have to make it work." And we tried to make it work. And then 18 months later, I said, "We can’t continue to carry out our responsibilities unless we have a substantial increase." The chiefs indicated that they needed roughly $148 [billion], $154 billion, if you include national missile defense and some of the other intelligence matters. And at the minimum, we said we needed at least $112 [billion]. And the president agreed to an increase of $112 billion over the future years defense budget.
So we started a very major swing up. And over that period of time, between Congress and the executive branch, we actually went up to about $170 [billion], $180 [billion]. So we have had a major increase in our defense spending, and so we are now at $296 billion, three and a half years later. So we have come from a level of defense spending that needed to go up, that has had the support of the president to go up, and we need to go even further, and we will. Whoever takes over the White House, there will be increases coming in the future.
But what I thought I would talk about just very briefly this afternoon—I said briefly, [but] I’m already 20 minutes into my presentation and I haven’t gotten to the point that I wanted to make yet. That’s my senatorial training. [Laughter.] Russia, China, and weapons of mass destruction.
I think the biggest challenges facing the next administration and the administration after that, in terms of foreign policy and defense policy—and the two should, of course, be coherent and integrated—will be this: how we deal with Russia as a major power to contend with; not necessarily as a superpower, but as a country of great size, of great natural resources, that covers 11 time zones. We will have to contend with [Russia] and [decide] how we manage that relationship with them and what we will do in terms of continuing our relationship to reduce the level of nuclear weapons.
We have something called the Cooperative Threat Reduction Program, the so-called Nunn-Lugar program. And yet I always find it somewhat stressing, or distressing, I should say, to hear it asked, "Why is it only the United States that’s concerned about reducing the nuclear weapons with Russia? Why haven’t other countries, other nuclear powers, volunteered to share in that effort to help Russia dismantle and dispose of their large stocks of nuclear weapons under the START I and START II treaties?"
We seem to be the only ones who are prepared to step forward to do that. And while other countries have complained about national missile defense in terms of the United States seeking to protect itself against a proliferation of weapons of mass destruction, it seems the United States has been left to largely bear the burden as far as dismantling and getting rid of nuclear weapons. But how we manage that relationship with Russia is going to be very important and very challenging, whoever is elected to the White House.
There is China. I just returned from China this July. And after a year hiatus in our relationship for -- as what they said, obvious reasons -- China wants to get back on a solid track with the United States. I had a very good meeting with the Chinese leadership, and they want to establish good military-to-military relations. And it’s important for us that we do this.
It’s also important how we manage the situation in Taiwan. Going back over history, many of you are familiar with Patrick Tyler’s book, no doubt, about a Great Wall and how every president since Richard Nixon has had to contend with the Chinese leadership over the issue of Taiwan. And it still remains a major subject of debate. They are intensely interested in the subject matter. I can tell you, if someone asked me, "What was on the agenda?" I would say, "Three items: Taiwan, Taiwan and Taiwan." That’s exaggerating a bit, but it is something that they feel passionately about. And we have to deal with that issue and will continue to deal with that, hopefully in a constructive way.
I will tell you that I saw a change in both the tonality and also what was said during my visit to China. A year ago or less, China was talking about the possibility of their resorting to warfare, using arms, setting a deadline in terms of when these negotiations or discussions would be completed or else they may be forced to use military force. When I was there in July, they said something that was different. They said that they did not give up the right to use force, but they had no intent to use force. Now, some may say that’s a distinction without a distinction, without much of a difference, but I think it was quite a significant difference in both the tone and the content of that message.
Secondly, I found that if you look at what is being said in China and Taiwan, the Chinese leadership will say, "It’s one China, two systems." And if you listen to the new Taiwanese president, he has said, "One China, two interpretations." Somehow there is a way to breach that difference if people of good will and creativity take advantage of the opportunity to find ways of bridging that peacefully. In the meantime, we maintain our posture. We have a one-China policy. We believe in the Three [Communiques], and support the Three Communiques. But we also support the Taiwan Relations Act. That’s hard for the Chinese leadership to reconcile, because, on the one hand, we’re supporting the one-China policy. On the other, they believe that by supporting Taiwan or the Taiwan Relations Act, we’re undercutting the policy. But nonetheless, we’ve tried to make it very clear that we expect those tensions to be resolved peacefully and not through the use of arms and force. And that will continue to be our policy.
With regard to weapons of mass destruction, we are now seeing at least 20, 24 countries—let’s call it two dozen countries—who either have developed or are in the process of developing weapons of mass destruction. That’s a word that doesn’t mean a lot, I suppose, to most people who hear it. And that’s the reason why, when I went on television a couple of years ago, I held up that five-pound bag of sugar, because it loses its meaning when you use that phraseology.
If you take a five-pound bag of sugar and you say, assuming this were filled with, let’s say, anthrax instead of sugar and you spread that with the right kind of temperatures and right kind of wind over a city the size of Washington DC, you could wipe out almost 70 percent of the population just with five pounds. There are tons of anthrax in existence. There are tons that have been manufactured. And so this is just one element that we have to contend with for the future. How do we gain control over these weapons of mass destruction, which are proliferating and will continue to proliferate? If you recall the words of the poet Auden, he talked about a "man clutching a little case who walks out briskly to infect a city whose terrible future may have just arrived."
Those are the kinds of challenges that we will have to face in the future, as well as the threat of cyber-terrorism. We have a number of countries who are now not turning to amateurs or teenagers and hackers, but dedicated professional cells, who are training in ways to disrupt our financial systems, our communication systems, our infrastructure, our power system.
You saw the fear that we had during the Y2K turnover. Thanks to John Hamre, by the way, there were no tragedies. Some in the media asked, what was the big fuss all about? Why did we spend all of that money? And you can imagine what would have happened if one plane went down or if we had any kind of a tragedy involving multiple casualties, where the fingers would have been pointing. But John Hamre, working with the executive branch, I would say, largely took that issue in hand. And we were able to make that transition with no casualties.
So that is something that we have to be worried about for the future in terms of whether a country or group can shut down or cause Wall Street to certainly crash, whether you suddenly pick up your stock portfolio and find it says, "Zero. Thank you very much, but [your investment] is somewhere in the Bahamas" or the Cayman Islands or maybe in a Swiss bank, but you don’t have it anymore. Those are the kinds of critical infrastructure that we will have to protect. And again, John was in the forefront of our effort to protect the critical infrastructure of this country.
So those are, I think, the major challenges, in addition to reforming our military to make it more agile, flexible, easily deployable, more rapidly deployable, and survivable. Doing all of that takes some time, but I think that we have passed that point where we are now reaching sort of a critical mass of innovation where we now have really integrated and ingrained jointness in our training and our doctrine. And you will now see that start to multiply with, I think, greater and greater efficiency.
Let me conclude here, because now I have exceeded my time allotment, and we’re going to have some questions, if not answers. [Laughter.]
I will tell you a story that has always stayed in my mind because I read it many years ago. It is in a book written by Stuart Alsop, and it was called Stay of Execution. In that account of Alsop’s battle with cancer, he talked about a meeting he had with Winston Churchill. They had dined together that evening. And they had consumed, I assume, considerable amounts of good wine, perhaps some brandy as well, and [were] enjoying cigars at the end of the evening.
And Churchill looked over at Alsop and he said, "America, America, a good and strong country, like a workhorse pulling the rest of the world up out of the slough of despond and despair." And then he looked very accusingly at Alsop and he said, "But will America stay the course? Will it stay the course?"
I am here to say that, more than 50 years later, we have certainly stayed the course. And with the continued leadership that we have had in the Pentagon, with people like John, Dave Abshire [President, Center for the Study of the Presidency; former President; CSIS] and so many of you who are here, we will continue to stay the course. Thank you. [Applause.]
And I would like unanimous consent to insert my original text as if it appeared in the record as being fully read. [Laughter.]