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DoD News Briefing - Rear Admiral Craig R. Quigley, DASD PA

Presenters: Rear Admiral Craig R. Quigley, DASD PA
April 24, 2001 2:00 PM EDT

Tuesday, April 24, 2001 -- 2:00 p.m. EDT

Quigley: Good afternoon, ladies and gentlemen. I apologize for being a few minutes late. As Charlie knows very well, I am not fond of doing that.

I have a few announcements to make and will be glad to take your questions. First, on the flooding in the Midwest, more than 600 National Guardsmen on state active duty in five states are hauling sandbags, patrolling dikes and levees and evacuating residents to help recovery from severe flooding in the Mississippi River regions, extending from Minnesota to Mississippi.

The Army Corps of Engineers has constructed temporary levees to protect the towns of Wahpeton, North Dakota and Breckenridge, Minnesota. These levees combined are about eight miles long and have prevented about $30 million in damage to the two cities. Also, the Corps' 150 people have issued more than 4.8 million sandbags, 1,325 rolls of polyethylene sheeting, and 104 pumps to Minnesota, North Dakota, Wisconsin, Iowa and Illinois, and authorized expenditures of $6.3 million for advanced measures and flood-fighting and emergency operations.

The Coast Guard is enforcing river closures, conducting air operations for damage assessment, and providing disaster response units to get food to stranded livestock and respond to other marine emergencies.

And finally, about 100 volunteers from Grand Forks Air Force Base, North Dakota, responded to the cities' call for volunteers in preparing sandbags there as well.

Second, last Friday the government of Japan announced a $50 million package to buy out, shut down, and dismantle the Envirotech incinerator adjacent to the Naval Air Facility in Atsugi, Japan. Yesterday, Secretary Rumsfeld sent a letter to his Japanese counterpart, Defense Minister Saito, expressing his appreciation for the government of Japan taking this major step. As the secretary has said, this action will make an important contribution to the local environment and to protecting the health and safety of the U.S. personnel and Japanese citizens who live and work in the surrounding area.

Third, a memorial service will be held tomorrow, April 25th, at 9:00 in the morning in the Memorial Chapel at Fort Myer for the seven American service members and their nine Vietnamese colleagues who were killed April 7th in a helicopter crash in Vietnam. Deputy Secretary Wolfowitz will be a featured speaker, along with the deputy chief of mission of the Embassy of Vietnam and the commander of Joint Task Force Full Accounting, Brigadier General Harry Axson. Media coverage is invited and a press advisory with further details is available from DDI.

Fourth, tomorrow at 10:00, here in the briefing room, the Employer Support for the Guard and Reserve program will be announcing its 2001 public service announcement campaign. This is part of an overall communication program to keep our nation's employers and citizens informed about how civilian employer support is critical to the capability of the National Guard and Reserve Forces to perform their national defense missions. And for more information, we have a press advisory on that.

And finally, we are pleased to welcome 11 public affairs and information specialists from the Colombian military and their Southern Command escorts. These officers are here as a follow-on to a SouthCom-sponsored public affairs exchange with PAOs from South American nations. They are here to learn more about the role of government spokespersons and to observe our briefing. While in the Washington, D.C. area, they will also visit the Defense Information School and the State Department. Welcome to all of you.

With that, I'll take your questions.

Charlie?

Q: Craig, is the U.S.-Taiwan meeting now over at the NDU [National Defense University]? Could you tell us if the full U.S. offer was presented and what the tone of the meeting was? And what incentive does Taiwan have to buy Kidd class destroyers if they have the prospect of buying Aegis within a year or two?

Quigley: Well, the meetings with the -- this was General Huoh -- H-U-O-H is the correct spelling -- he is the vice chief of their defense staff -- went from about 9:00 to noon today. They were held over at the National Defense University on Fort McNair.

And what these exchanges of information are -- we need to be clear here. This is an expression of the United States' willingness to approve these systems, this list of systems, if the Taiwanese wish to purchase them. And the way ahead from here is that the Taiwanese will take this list back home and they will discuss it within their government, within their military, in the weeks and months ahead, and make an assessment as to whether or not the individual items on the list are affordable; is this a system that fits into their overall blueprint and architecture for their defense capabilities in the years ahead; will I have training systems, maintenance systems in place, or can I hire those out? How will I support these systems once I have them in my inventory?

And it's entirely conceivable and, in truth, many times in past years that an item that we say will be approved, should the Taiwanese ask for it, the Taiwanese never ask.

And after further assessment on their part they determine that it's not affordable or not desirable for some reason or another and just simply never ask.

But if there's an item on the list that they do wish to pursue, then it's a separate and individual exchange of letters; it's a request for a sale and it goes through the normal process that you are more familiar with, I think, in our normal discourse between nations, where you ultimately have the notification of the Congress and the whole bit.

So this is the first step, really, in this process that will go on for another year. It's an additive process, of course. The sales of equipments from prior years all go into the assessment that we do to try to determine the legitimate defensive needs of Taiwan.

Q: Just a brief follow up: Again, what incentive do the Taiwanese have to buy Kidds if you're still holding out the prospect of aegis? And how do you respond to Chinese charges that submarines are offensive weapons and not defensive weapons?

Quigley: Well, if you -- to the first question, Charlie, the next step from here would, once we have expressed our willingness to approve the sale or transfer of the four Kidd-class destroyers, the Taiwanese then take that back and they say, "Okay, do we want four, do we want a number different than four, how would we man them, how would we train our sailors to operate them, how would they fit into our overall defense architecture?" And it's possible that they would not ask for those four Kidd-class destroyers to be made available to them. That's entirely possible. So that the next step from here is them to take this list back home and to go through it item by item, look at it holistically: "How does it improve my defense capabilities, is it affordable, is it maintainable?" -- and things of that sort.

So the answer to your first question at this point, really, rests with the Taiwanese.

Q: And again -- and again, excuse me --

(Cross talk.)

How about the charge by the Chinese that submarines are offensive weapons -- and we don't build diesel-class subs -- how would that be handled?

Quigley: Well, I don't know the answer to the "how it would be handled" yet. I mean, we're just not to that -- first things first. And first, the Taiwanese would have to express their interest in pursuing the acquisition of diesel electric submarines, and that there are a variety of designs available in the world today. But we just have to take that one step at a time, and we're not that far yet.

Q: But the Chinese say they are offensive weapons.

Quigley: Well, I would disagree with that and say that the purposes that -- the spirit in which -- that we would pre-approve them for sale to the Taiwanese was -- excuse me -- as a system that would meet the legitimate defense needs of Taiwan.

Q: Are you raising the possibility of building diesel submarines for Taiwan?

Quigley: I don't know the answer to that one yet, Pat. Like I say, first things first. There are a variety of good diesel electric submarine designs available today. You could manufacture them in several different places.

You could do licensing agreements. Just don't know which way that would go.

Q: Craig --

Q: A German diesel submarine --

Quigley: The Germans have a good design. The Dutch have a good design. I believe the Italians -- there are good designs for diesel electric submarines out there.

Q: They would build them, and we would supply them to Taiwan?

Quigley: Don't know that step.

Q: Craig, the Germans and the Dutch are the two main manufacturers of private subs, and both of their governments said today that they haven't even been approached or sounded out on the issue of licenses.

Quigley: Right. That's because we're not to that step yet. The next step, as I've said, is the Taiwanese to express their interest in pursuing this. This is our willingness to approve their request in advance, pre-approval, if you will, should they so desire.

Now there's no requirement for them to -- they take this back. They assess this. They could ask for a smaller number. They could ask for the same number, with particular design details in mind. We just don't know. We're just not to that point.

Q: Well, how do you phrase the offer to them of submarines?

Quigley: Diesel electric submarines, no particular design.

Q: Why are we offering them something that we don't have? Why is the U.S. even inserted into that process? If they want them, why don't they just go directly to manufacturers of them? Why are we involved?

Quigley: Well, let me just -- if the Taiwanese choose to come to us --

Q: Right.

Quigley: -- and ask for the acquisition of diesel electric submarines, we're saying that we would say yes to that request.

Q: But we don't have them.

Quigley: And much homework would then be required after that step.

Q: So I just -- could you please explain, because I think a lot of people don't understand, why the United States is giving permission for them to purchase from us or from someone else a weapon that we don't have to give them?

Quigley: Well, I think you have to take it one step at a time. I don't have all the details, Pam. I'm sorry.

Q: Oh, I'm not asking for the details, I'm asking for the arrangement that we have with Taiwan. Why are we giving them permission to buy or lease or get a weapons system that we don't have at the moment?

Quigley: We would help them find a way if that is something they wish to pursue.

Q: And why wouldn't they just turn to someone else who has it and get it directly from them?

Quigley: Can't answer that one. I don't know.

Q: Can I follow up on that, Craig?

Quigley: Yes.

Q: Okay. Is this list made up somewhat from the Taiwanese giving some input to some of the things they're interested in? Does that go into making up this list?

Quigley: It is an element of that, yes. But it's also an individual U.S. assessment every year as to trying to determine the most pressing and legitimate of their defense needs. So it is a combination of that.

Dale?

Q: How did the submarines get on our list in the first place? I mean, somebody had to say, "Well, I wonder if they'd be interested in diesel-electric submarines?" How did that get on our list of things that we'd be willing to sell them?

Quigley: I don't know the derivation of that.

John?

Q: The White House spokesman today said that there would not have been an offer to provide diesel submarines to the Taiwanese if the United States was not reasonably certain it could make good on that offer, suggesting that some groundwork has already been done on this. This isn't just sort of out of mid-air. Can you describe any kind of preparation work that the Pentagon has done to see that this deal can go down? Or are you saying that no preparation work whatsoever has been done by the Pentagon to look into seeing whether these submarines can be provided?

Quigley: We are reasonably sure that if the Taiwanese wish to come through us to obtain submarines, then, going back to Pam's question, we will find a way to make that work. But to the best of my knowledge, no advance prep work -- because those of you who have been rapid to pick up the phone and call the Dutch and the German governments have found that there has been no interaction with their governments because it's premature to do so at this point. But if they express that interest, we are confident that we can find a way to make that happen.

Q: Craig, on this point of the Taiwanese interest in specific weapons, isn't it true that they in fact did come to the U.S. government and say, "Here is what we want" --

Quigley: Yes.

Q: -- including submarines?

Quigley: I don't know that submarines or any other element was on that list. I know they come to us with a list of what they consider to be -- they think that they'd like us to consider. We take that as an element and then we do an independent assessment of what we feel their legitimate defensive needs are, in accordance with the law.

Q: So you don't know --

Quigley: And from that you end up with this list that was discussed with the Taiwanese this morning.

Q: You don't know what -- (inaudible) -- is on that original list?

Quigley: No, I don't.

Chris?

Q: Is there a precedent with Egypt and U.S. companies being in involved in a diesel-electric submarine of European origin? Isn't that working its way through the process?

Quigley: News to me. Let me take that. It's the first I've heard of that. [In September 2000, Egypt signed a letter of intent with a consortium of Lockheed Martin Undersea, Ingalls and RDM (a Dutch company) to build two Dutch "Moray" class submarines. The subs will be built at the Ingalls facility in Mississippi. Egypt requested a waiver to use foreign military financing (FMF) grant funds to build these submarines and the Defense Security Cooperation Agency (DSCA) approved the waiver in principle.]

Q: If Taiwan accepts everything that the United States has offered, what's the total value of --

Quigley: I have no idea.

Q: And how soon would the Kidd class destroyers be able to be delivered?

Quigley: Well --

Q: (Off mike) -- tomorrow, would they have them a year from now?

Quigley: No, it would be a couple of years, at best, to bring them out of mothballs, test them, train up crews, set up some sort of a maintenance system, the logistics support mechanism within Taiwan to support them. A couple of years is a good estimate, but that's just that, at this point.

It's not at all clear to me that the capabilities of the ships, as they would be turned over to the Taiwanese, would be identical to the capabilities as they left active service in the United States Navy. Don't know that.

Q: Could you go over the other things in the package, like the P-3s, when they would be available?

Quigley: No idea.

Q: Craig, what else was approved for sale, besides the P-3s, the destroyers and the submarines?

Quigley: I think I'll not go farther than Ari did.

Q: No weaponry? No --

Quigley: There were other items on the list.

John?

Q: The list seemed to include -- and even your remark about the destroyer seems to imply a certain level of training by the U.S. --

Quigley: Sure.

Q: -- that would go to the Taiwanese. The Chinese have been worried about this, about an increased military-to-military relationship with the U.S. and the Taiwanese. Is that envisioned in this package, and is there going to be a sharp increase in the amount of military-to-military?

Quigley: I don't know if I'd go "sharp" because the timing is very much up at the discretion of the Taiwanese. When they have assessed as to whether or not these items will fit into their overall architecture, they are then free to come to us at a timing that is completely their discretion. So they could do one at a time over several months, or something, or two at a time or something like that -- whatever they think is digestible, if you will, by their system.

But there is never a system that the United States would sell or make available to any other government that does not come with some sort of crew training, maintenance training. That's just always the case, John. You just never say, "Here you go. Good luck." And there is training that comes along with the ownership of that system. So we have done that for many years. I don't think this would be more or less than other sorts of arms sales to Taiwan in years past, or any other country, for that matter.

Dale?

Q: The United States buys nuclear submarines now from Newport News and Electric Boat.

Quigley: Right.

Q: Would the Pentagon have an objection if one or both of those companies wanted to produce submarines for Taiwan?

Quigley: I don't know as if any option is off the table, if the Taiwanese choose to exercise that option.

Yes, sir?

Q: Yeah, Admiral, yesterday the Chinese embassy here in town said that this particular sale would be destabilizing to U.S.-China relations. I'm wondering, in his recommendation to the president, did Secretary Rumsfeld take into account China's reaction to the arms sale?

Quigley: I'm sure that every member of the president's national security team looked at this from their particular area of expertise, made their individual recommendations known to the president, and ultimately he made his decision as to which way he was going to go. But as you know, the secretary does not publicly share his advice to the president, and, you know, only the secretary knows what his advice is to the president on any given issue. And that's something he does not share publicly.

Q: Aside from what you told John about normal training on exchange or weapons, is the United States now preparing to increase its military-to-military ties with Taiwan, such as -- in areas such as command and control and other areas?

Quigley: No, not that I know of. I think that it's pretty much the provision of the defensive systems that we offered to approve in the briefing that we offered them today at NDU.

Chris?

Q: Craig, when you say that the capability of the Kidd class as delivered, if they choose to take them, would not be the same, do you mean that they will be dumbed down or they will be upgraded?

Quigley: I don't know. Both I guess are possible. They've been out of commission now for several years; technology has moved on. They had a variety of weapons systems. They're very capable ships. Would the Taiwanese see that every system on board is necessary for them to operate that ship and how it would fit into their architecture of their defensive capabilities, they could choose to not exercise or not use a given system.

For instance, the ships carried the LAMPS [Light Airborne Multipurpose System] helicopter, okay? And if the Taiwanese should say, "I like everything on the ship except we don't intend to operate LAMPS helicopters," well, then, I cut out the cost and the maintenance and the fuel and the people to run, maintain, refuel, rearm LAMPS helicopters. And I therefore have cut down my crew size, I've cut down my costs. Maybe that'll be the most important element of the ship's capabilities to them. We just don't know that. Those are details we don't know yet.

Q: Would it sell --

Quigley: John?

Q: Was there an effort by the Pentagon to try to low-key this meeting today? Was there a photo op and various things?

Quigley: There is typically -- I don't know if there's ever been a photo op over the years. These meetings are private, and we have done it that way as far as I can remember.

Q: Government to government, or government to entity, or whatever Taiwan is? So there was an effort to downplay the publicity of this in a way.

Quigley: Mmm-hmm.

Q: Yes?

Quigley: Mmm-hmm.

Q: And why?

Quigley: Because it's an agreement between Taiwan and our government of many years that this is not a -- the exchanges of letters and of information and agreements is not publicly divulged. Now, ultimately, if Taiwan chooses to come back from one or more items from this list and purchase them from the United States, then that would be handled in a publicly visible way, as all weapon sales are.

Q: Craig --

Quigley: Yes, Jim.

Q: The most pressing threat that's been pointed to in China is the missile buildup across the Taiwan Strait. But what in this weapons package addresses that? It seems like -- at least the weapons systems that have been mentioned so far seem to be mainly for fleet defense and anti-submarine warfare. Is there anything in this package that would help the Taiwanese counter that missile threat?

Quigley: I'm going through the list in my head. I can't give you an accurate answer. I would say it's a robust package, heavily oriented towards maritime capabilities. I don't know if there is anything in there -- I just don't remember, Jim, if there is anything -- none of the items that we've discussed publicly, as you've seen this morning, the P-3 aircraft, the Kidd destroyers and the submarines, those are all very maritime in their focus, with a sea control and an anti-submarine warfare capability; more so than missile defense, certainly.

Q: So, for example, did Taiwan express an interest in buying the latest PAC-3 version of the Patriot missile, and was there a conscious decision not to make that system available?

Quigley: Again, I will go no further than Mr. Fleischer has gone earlier in the day in describing the systems.

Q: (Off mike) -- was there a background briefing from the Taiwanese on the PAC-3?

Quigley: I don't know.

Q: Also, could you say, in the case of the Kidd class, one of its capabilities is to launch Tomahawk cruise missiles. Was that --

Quigley: No, actually it is not capable of doing that, yeah. That was -- those ships were designed before Tomahawk had been invented, if you will, except it was in its very, very early stages. And with as much weight as high as you are in the ship -- if you recall, Jim, in the early days of the Tomahawk program we put these armored box launchers on the topside of the ships. That really did bad things to the weight and moment of that ship, and you just could not do that.

So, short of ripping out the entire missile -- surface to air missile launcher and magazine system and putting in a vertical launch system, which is what you have in Ticonderoga-class cruisers -- kind of the next step up -- which would have been astronomically expensive, they just said no, for these four ships we will not give it Tomahawk capability.

It had Harpoon anti-ship missiles, but those were much smaller, much lighter; did not do the bad things to the weight and moment of those ships.

Pam?

Q: I understand that there are both political and military reasons for not offering the Aegis destroyer system. Could you explain, from a military point of view, what the concern is about Taiwan not being able to absorb Aegis? What does that mean? What's the danger if you give a military a capability that they can't absorb? What could happen?

Quigley: I think you try to make your decision based on what a country or an entity can effectively use. Other than to say that a variety of inputs went into the president's decision, that being one of them, I can't rank them for you --

Q: Oh, no, I don't want you to. I'm just saying like, is it -- is the problem like if you give them Aegis and it can take on 100 targets at once, it's going to start shooting the wrong people out of the sky because they can't operate it? What's the danger?

Quigley: One of the concerns might be to devote so much of a defense budget to a particular system that other capabilities atrophy over time that you also feel are important to have a comprehensive, well-rounded defensive capability.

Aegis is a demanding system technologically, training-wise, maintenance-wise. It's very good when it's full up and running, but it is not cheap to operate. And if you would devote so much of your resources to that particular system, let's say, there is a possibility that other elements of your defense capability might atrophy to the point where you find yourself in a serious imbalance, and we would not think that a good thing.

Chris?

Q: You mentioned that the Kidd class might be sold, or I think you said "transferred". I'm guessing these would be -- even if they were sold, it would be a much smaller price tag associated with that than the billion that an Arleigh Burke would cost.

Quigley: Oh, yes, yeah.

Q: Can you give us a rough idea?

Quigley: No. Have no idea. We're not to that step yet. I mean, the sales of former U.S. ships have varied widely in price over the years, depending on how many years service they are judged to have left, how sophisticated they are. It's an element of Foreign Military Sales. If the U.S. thinks its own national interests are increased by having a friend or an ally in one part of the world have a very capable sort of a system, whether it's a ship or another one, there could be discounts or something given to the actual cost and the transfer. So it's all over the map.

It's an individual decision.

Q: (Off mike) -- right? They just have to pay, for example, for the marginal costs of getting it out of mothballs and getting it ready, rather than having to pay for the whole platform itself?

Quigley: I think we need to have step two take place first, and that's an expression by the Taiwanese of their interest in such a system.

Dale?

Q: Well, just to follow that, I mean, have you all given the Taiwanese a range of costs here? It looks like to me they'd have to know what they're going to have to pay in order to help them decide what they're interested in buying.

Quigley: If they're at all interested in one or more of the elements from the list, Dale, they would come back to us and say, "Let's talk in more depth on this item," and then we would go to the next step, which would be more --

When you would receive a letter of request, it would -- then that letter typically asks for a detailed cost and maintenance and logistic support and things of that sort, all as part of the package. And typically, these are exchanges that take many months to accomplish.

Q: So as of now we haven't even given Taiwan a ballpark figure or a range of figures? For example, the Kidds might cost between x and x. We don't --

Quigley: Not that I'm aware of, no. Not that I'm aware of. They're very aware of the capabilities of the ship type. You can pick up a copy of Jane's and get a very good description of what those ships are capable of doing. But to the best of my knowledge, there's been no exchange of cost information yet or the numbers of people required to maintain or repair, things of that sort.

Q: New subject?

Q: One more?

Quigley: Sure.

Q: At today's meeting, did the Taiwanese indicate how long they want to mull over this, and when they decide what they want, what kind of an announcement will be made? Will it be a public announcement of, We want x, y, and z?

Quigley: The answer to the first part is no, and the answer to the second part is when they make a request of the United States, then that would be handled like a normal weapons sale to another government, and that would ultimately be worked here, within the State Department, other elements in the interagency process, and finally put forward to the Congress for them to approve or disapprove. And then it's completely public.

Otto?

Q: Change of subject. The secretary was given the Osprey Commission report this morning. What's in it has been known since last Wednesday. Has he had any reaction initially to it, that you know of?

Quigley: Actually, he was not. The deputy secretary took the brief this morning, and I don't know the way ahead from here.

Pam?

Q: On the Peruvian shoot-down, can you explain about the plane that the CIA folks were flying and did it have a U.S., like, flag on it or a tail number? I understand it was owned by the military, and could you explain the CIA was flying a plane owned by the military?

Quigley: I don't think that we have publicly stated the ownership of the plane, other than to say it was owned by the government of the United States.

Q: Is it owned by the military?

Quigley: I'll stick with "the government of the United Sates."

Hunter?

Q: Well, wait a second, Craig. That's not exactly accurate. Senior U.S. government officials continually told reporters over the weekend that this [aircraft is] owned by the Defense Department, and that statement has not ever been challenged by anyone in the administration. So it is apparently true, and could you please explain why the Defense Department bought these planes and turned them over to the CIA to run in the drug war?

Quigley: I won't say that what you were told over the weekend is wrong. I'm saying that I believe that as far as I'm going to go from the podium today is to acknowledge that the planes are owned by the government of the United States.

Hunter?

Q: Yes, sir. The -- just to return to the V-22 report, can you just give us the breakout of what happened precisely today --

Quigley: Sure.

Q: -- what was said to the deputy secretary, and --

Quigley: Largely a repeat of the public meeting from a week ago. It lasted an hour, and it was General Dailey and the entire panel giving -- again, it's my understanding that it was a verbatim presentation. Now, it didn't take four hours like last week did. This was condensed into one hour. So there were probably fewer slides used. I did not -- I was not in attendance last week; I was today. So it was a fairly short number of slides that were used in the presentation. But the recommendations were all in there, the findings, the opinions, the same as the public saw a week or so ago. My sense is that Deputy Secretary Wolfowitz will take that today, think about it for a while, and like I say, I have not had a chance to discuss with him the way ahead from here.

Q: Well, Craig, would they -- do you expect that there will be a separate decision on the future of the V-22 program before the defense review is finished, or --

Quigley: I have the same question myself. I don't know yet, Rick. You can -- a couple options here. I mean, you could -- the deputy could make the decision, he could recommend to the secretary, or everything gets put on hold until the defense reviews are more mature. I don't know which it will be.

Q: Can you give us the rationale for why the Defense Department wouldn't acknowledge ownership of the aircraft that was involved? I mean, what --

Quigley: We said that the ownership of the -- the specific ownership of the aircraft is a classified issue.

Pat?

Q: Could you give us an update on Secretary Rumsfeld's divestitures? Has he divested all his investments in defense-related companies or companies considered major defense contractors?

Quigley: He has -- as you know, he signed an ethics agreement on the 18th, I believe it was, of January saying that within 90 days from his installation in office, from having taken the oath of office he would take actions to divest himself of all of the defense-related holdings and to cease his association with non-government organizations. The vast majority of those were completed within days after his having been sworn in, but there are several of the non-public holdings that, despite his efforts and that of his financial advisers and his attorneys, have not found a buyer in that 90 days.

So he has requested an additional 90-day extension from the Office of Government Ethics and the Senate Armed Services Committee, the same entities that agreed in the first place for the 90-day window of time. He sent that letter to them on the 16th of April, eight days ago, and has not yet received a response yet.

So he still does not -- all the divestitures are not yet complete. It's not for lack of trying.

Q: Are we talking about divestitures in defense-related industries?

Quigley: All of the items that he agreed to take the actions to divest himself of, anything that either in truth or in perception could have some sort of an impact on defense-related issues, that was what he agreed to take the action to divest himself of, and it is not yet done.

Q: How much has not been completed, dollar volume?

Quigley: The items that you saw redacted from his ethics agreement, all of those are still undone. None of those have been completed since the release of the redacted version. And I have no idea what's --

Q: Every -- (inaudible) -- been divested?

Quigley: Yes, sir.

Q: So --

Quigley: And his affiliation with organizations, that is all complete. And if you see it in the ethics agreement and it has not been redacted, that divestiture is complete as well.

Q: So what he retains, he still retains a secret list of investments?

Quigley: I wouldn't put it that way.

Q: You just said it was redacted. I looked at it; you couldn't see what the investments were in.

Quigley: That's redacting.

Q: That's secret, I mean it's not a public record --

Quigley: Your word, not mine.

Q: All right. So we don't know where these investments continue and what --

Quigley: I will tell you they do continue. He has not divested himself of those yet.

Q: How much money involved?

Quigley: I have no idea.

Q: Is it around $100 million?

Quigley: There is no market value, you see, that's the problem. It is not a -- if you want to buy a share of Boeing today, I could tell you right now what a Boeing share goes for, and I could sell it or I could buy it at that amount. But these are not publicly traded interests and there is no public market for them, it is a private market. And so you are largely at the mercy of a private entity to come in and make a bid. If no bids, then how am I supposed to divest? That's the problem.

Q: Well, he gives them charity or -- that's what David Packard did.

Q: You advertise them, tell people what they are.

Quigley: Well, that's not the choice that he chose to do, Pat. Instead, he asked for a 90-day extension on the window of time to complete the divestiture.

Q: If you tell me what these companies are, I will put them in my newspaper and you'll get buyers that way.

Q: Yeah!

Quigley: Well, that's -- I think there are lots of market people who would tell you that's probably not a very wise thing to do.

Q: Sir, if I can follow up on that, as I understand it, these are partnerships that he has invested in and he can simply walk away from. He may not want to because it's a significant loss of money, but if a buyer can't be found, at some point he just loses the investment. And is he asking for another 90 days to try to find more buyers? And how long will he continue to do that?

Quigley: There are a variety of ways, other than walking away, to complete the divestiture, and he hopes that within 90 more days he can find a way to accomplish that.

Q: Has the office responded to his request?

Quigley: No. Same answer just a minute ago. No.

Q: You haven't heard any estimated valuation of these unlisted investments?

Quigley: No. No.

Q: Because I saw one, it was almost $100 million.

Quigley: No, I have not.

Q: Craig, going back to the Peruvian airplane for a moment, what's the wisdom of confirming it's a U.S. government airplane, but saying the specific governmental entity that operates it is classified?

Quigley: The agreements -- when the classified particulars of the program were put in place, that that was determined to be the level of detail that we would provide and --

Q: And who was that struck with, the host country?

Quigley: Various agencies within the federal government.

Q: Craig, same topic?

Quigley: Yeah.

Q: The Defense Authorization Act for FY '95, I think, is the law that authorizes this activity, right, the provision of --

Quigley: I don't know.

Q: Well, what can you tell us about this? This is a public law. What can you tell us about the Defense Department role in interdiction in South America? This is part of a public law; it's authorized by the president, et cetera.

Quigley: Good grief! The Defense Department has a wide variety of things it does in drug interdiction in South America.

Q: But specifically focused on the aviation aspect of it and the fleet of aircraft.

Quigley: Other than to acknowledge that the federal government owns this particular plane, I will not divulge any details of that.

Yes?

Q: About the Greeneville accident, is the secretary satisfied at what Admiral Fargo has concluded yesterday? Was it a proper decision?

Quigley: The secretary is satisfied that the Uniform Code of Military Justice has been properly applied. And we'll leave it at that.

Bob?

Q: What happens to the civilian visitation program now?

Quigley: It's my understanding that Admiral Fargo has recommended to the CNO that that program be reviewed, at least Navy- wide. And I would assume the CNO would see that and consider that recommendation and take action as he sees fit.

Q: What about the rest of the military?

Quigley: It has already started, Bob, and it started some weeks ago, really, with the secretary's memorandum that put the embargo in place on civilian guests actually operating equipment, actually firing crew-served weapons and things of that sort. In that memo he also asked that the services use this as a foundation to review their programs. And the services started right off doing that. And I think the Army was the first one that, at least that I saw, to more precisely define the activities that guests could conduct when they visited Army units in the field. I think the Marines were next. The Navy started the review, and I think felt that since it was Admiral Fargo's tasking to the Court of Inquiry to specifically look at this, they were going to stop on the Navy-wide until they got that input. Now they have, and they'll probably proceed from here. The Air Force, I just can't think of it at the moment. But all the services I think are well down that road to do just that. They don't have the same impetus, perhaps, but the principles are the same.

Q: So the secretary doesn't intend to lay down any kind of across-the-board guidelines for this throughout the Department of Defense, he's going to let each service take care of this as it sees fit.

Quigley: We did lay down guidelines. Our office, Public Affairs Office, put out the policy guideline shortly after the secretary's memorandum. I think we've made a copy of that message available before; we can certainly do it again. It's not classified or anything. You're welcome to a copy.

Q: Is that moratorium still in effect?

Quigley: It is. Mm-hmm.

Barbara. Be right back. Barbara.

Q: Slightly different subject. Do you have any information that would lend credence to the stories that the U.S. and China are planning an Internet war against each other the first week in May? Does the Pentagon have concerns about this?

Quigley: Oh, sure, I guess we always do. But I've seen the same stories that you have, I'm sure, Barbara. I mean, we have -- we're perhaps unique in the sense that the Defense Department has a full-time organization that is looking at hack attacks -- viruses, worms, you name it -- any sort of an intrusion on our computer systems 24 hours a day. Space Command has the overall tasking. The Joint Task Force for Computer Network Operations is looking. We're very much aware of it, although I'll tell you, we have not gone to a higher alert level. These are people that are already on alert all the time.

Q: Do you have anything that tells you that this Internet war threat is real?

Quigley: No.

Q: Okay.

Quigley: We've seen the stories over the past two-three days, two, three, four days, but beyond that, no. So we'll be watching. But, I mean, no more, no less at this point than we do any other day.

Yes.

Q: Yes, on Vieques. The legislature of Puerto Rico adopted noise control legislation designed to prevent Navy training in Vieques, particularly the Enterprise battle group scheduled to train this weekend. The governor is set to sign it, and also the attorney general of Puerto Rico has the injunction already drafted. So as soon as the government signs it, it will go to court to issue the injunction to prevent Navy training. Do you still believe that the legislation and the injunction are in the spirit of the agreement, or will, in effect, be able to delay Navy training?

Quigley: I don't know. We'll have to see what the final language of the legislation says and have our lawyers take a look at it and see what their advice is on the way ahead.

Q: Do you intend to proceed with the training scheduled for this weekend?

Quigley: Our intentions are to train starting as early as the 27th, yes.

Q: Okay. Other -- last week from this podium you confirmed that a Navy team had gone down to Puerto Rico for talks with the security personnel in Puerto Rico to make sure everybody was on the same page, agreeing on the measures to be taken. There have been increased threats for -- by protesters that they are going to try to trespass and invade the range to prevent training. Has the plan been agreed upon? Are they considering blockading the island, or at least the inner range of Vieques, to --

Quigley: A plan has been agreed upon. I think it's a good plan. I think it meets all the anticipated security needs of the training that is scheduled to start as early as Friday, yeah.

Q: And can you share any details of the plan with us?

Quigley: No.

Q: Okay. Another follow-up. Because of the legislation and the steps that the government of Puerto Rico has been taking in the last couple days and weeks, Senator Inhofe, Congressman Stump, Congressman Hansen have stated publicly that they don't believe that the land transfer scheduled for May 1st should take place because of Puerto Rico's actions in violation of the agreement. Does the department still intend to proceed with the land transfer of the western part of Vieques? Are you --

Quigley: We intend to comply with the law.

Yeah.

Q: Just to back up to your answer a minute ago about the security arrangement, does that still call for a role by the local authorities in terms of maintaining the perimeter, et cetera?

Quigley: Yes, it does.

Q: That -- their involvement remains as it has been?

Quigley: Yes. Yes. Local law enforcement will play a role in the security.

Q: Thank you.

Quigley: You bet.

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