Thursday, Dec. 12, 1996 - 10:15 a.m.
(Also participating in this briefing are Deputy Secretary of Defense John White, General John M. Shalikashvili, Chairman, JCS and Mr. Kenneth H. Bacon, ASD[PA].)
Mr. Bacon: Good morning. Welcome to our press conference on the Quadrennial Defense Review.
We'll start with opening remarks by Secretary Perry, followed by remarks by General Shalikashvili and then by Deputy Secretary White. After that, there will be time for questions.
I turn it over to you, Secretary Perry.
Secretary Perry: The debate on national defense issues sometimes focuses on needs -- that is, requirement for military forces. Other times, it's focusing on how best to meet those needs.
The Bottom-Up Review, which was started just a little less than four years ago, considered both needs and how to meet the needs, but it did something else. It also considered how to connect the needs with how to meet them.
It said if this is your assessment of needs, and it made that; then it went on to say here are the resources that are required to fulfill these needs. If you decrease the resources, then you have to reassess the requirements. That is to say, it connected requirements and resources with an iron logic. That was the really unique contribution of the Bottom-Up Review. It was the iron logic which connected requirements and resources.
That iron logic has framed the defense debate for these last four years. Not everyone agreed with our statement of requirements. All through the four years, including today, there are still debates as to whether two major regional conflicts is the proper way of stating the needs. Not everyone has agreed with the way we have allocated resources to meet those needs.
First of all, in our reduction, further reduction of end strength which four years ago was set to be 25 percent reduction from the peak of the Cold War and we carried it to 33 percent as a result of the analysis of the Bottom-Up Review.
We also put a first priority on readiness, stated it clearly in the fiscal guidance to the services, and that resulted in a higher allocation of resources to items like training. Training was a big beneficiary of the judgment that was made in the Bottom-Up Review.
We also made the judgment that quality of life was an indispensable element of readiness, and that led to a greater allocation of resources to such things as compensation, housing, health care.
So we had debates on each of these elements. But nearly everyone accepted, or nearly everyone accepted the connection that we made between them. In that sense I believe the Bottom-Up Review was successful -- it was successful in framing the debate, and it provided the intellectual core that enabled us to stick with our commitment to readiness. All of this in the face of a significant drawdown that was going on which made the Department otherwise very hard to manage.
This has paid off, I believe, in very important ways. The major evidence is in the performance of our forces on their major overseas deployments -- in Haiti, the Persian Gulf, Bosnia, and even in smaller deployments like Liberia. The performance, I believe, was outstanding, and that reflected the emphasis we put -- and stuck with -- on readiness, on training, on quality of forces.
Therefore, we have decided, and the Congress has also decided, that we should repeat this process, this Bottom-Up Review process, every four years. So we have instituted and have already begun the Quadrennial Defense Review. There will be, as a part of this Quadrennial Defense Review, a national defense panel. That will be appointed in the very near future and it will be appointed in full consultation with the Congress.
I want to emphasize to you and to the public that the Quadrennial Defense Review is not just a budget review. We have a budget review going on in parallel with the Quadrennial Defense Review, but in the QDR, we are assessing these fundamental issues which I've described to you -- the threats, the response to the threats, and the strategy. All of that defines the question of needs.
It will look at how we can meet those needs better, and there it will focus on technology, tactics, and training. And of course, how do we pay for it? How do we allocate resources? In that line it will focus also on what are the ways that we can manage the Defense Department more efficiently so there will be more resources available for the needs that are specified in this requirement, so that we can have the resources freed up, for example, from overhead, that will allow us to put more resources for personnel, for training, for modernization.
The essence of the QDR is a blueprint which distills the thinking of the Department on resources, requirements, and how they are connected.
I'd like to now ask General Shali to make his comments.
General Shalikashvili: Thank you very much, Mr. Secretary.
The first point I would like to make with all of you is that the Quadrennial Defense Review is an inclusive, collaborative effort involving not only the Office of the Secretary of Defense, the Joint Staff, but the services and our joint commanders out in the field as well.
You also know that in addition to my participation in this review itself, the legislation that mandates the QDR also calls on me to conduct an independent assessment of this review which will then be part of the final report that will be submitted to Congress and I, obviously, in my role as the Chairman, am prepared to do so.
In preparation for the QDR we have completed two efforts that I believe will be very helpful as we begin this review. We, the Joint Staff, the Services, and the CINCs, have completed Joint Vision 2010 which, I believe, will serve as a conceptual template for understanding our future military operations and the capabilities that we will need in the years ahead to remain dominant across the full spectrum of conflict and operations. In turn, the QDR will provide one of the many steps towards implementing Joint Vision 2010.
We have also completed a comprehensive review of our military strategy which at the beginning of this review would improve our understanding of the future security environment and enable us to assess the continuing relevance of our existing strategy.
At the end of the Cold War, as you so well know, we evolved from a force oriented on global war against a super power adversary to today, when we have a force that is oriented on deterring and combating two near simultaneous regional conflicts. But as Secretary Perry already stated, in the last three years we have learned that in addition to being able to engage in two near simultaneous regional conflicts, our very busy force is playing an important role in shaping the international environment through peace time engagement, to prevent conflict from taking place, and to be prepared to respond to crises, all of which seeks to resolve crises at the very lowest level.
In short, the QDR is about our military capabilities that this nation will need to further and to protect our interests in the years ahead.
But I'd like to stress that the QDR is not about protecting today's force. It is, rather, about shaping tomorrow's force. And I would also like to remind you that the measure of success will not be just how innovative we are. The right measure will be how well we go about protecting America's security interests.
With that, thank you very much, and let me turn it over to Secretary White.
Secretary White: Thank you, General Shali.
Let me make some more extensive comments building on the comments made by the Secretary and by the Chairman.
First of all, as the Secretary indicated, from our point of view, this is the time to do this. It's not only an issue of it being every four years, but it's also time, we think, in terms of building on the BUR experience and building on the experience we have had with the force and with our own policies over the last several years to take stock, to reexamine our assumptions, and to do a longer term assessment.
As has been said, from our point of view, everything is on the table. We are not holding sacrosanct any particular end strength, any particular platform size, any particular structure. We are going to look at everything. In addition to that, we are going to stress innovative approaches to what it is we're doing. We're going to stress joint approaches to what it is we're doing. And we are going to stress concrete options with respect to what it is we need to develop going into the future.
So it is important for us that everybody be involved, that it be directed in a way that we look at, in all of the various issues. I'll talk in a moment about the various panels. And that in doing that, we not only have assessments that are developed by the various institutions, the services and the CINCs, but also from the Secretary's guidance, my guidance, and the Steering Committee system that we have, that in fact we will provide guidance from the senior leadership of the Department as we shape and examine these various issues.
With respect to the fiscal environment, we think we have to be realistic. As we look out at the world, having just gone through an election and the debates that are ongoing, the commitment of the Administration to a balanced budget by the year 2002, we do not anticipate that there is more money out there for the Department of Defense. So it is realistic, as far as we are concerned, to deal with these issues in the context of the overall budget guidance that we already have.
Let me make a couple of comments about the structure of the process here. Obviously, the Secretary and the Chairman, in terms of their separate but related roles, are at the top of this. We then have a Steering Group that is chaired by General Ralston and myself. We then have under that, an Integration Group which represents people from all across the Department, led by people from policy, from PA&E, Bill Lynn in particular here from PA&E, and also from the Joint Staff and from A&P. So we have a full array of people across the Department, and Ted Warner and Bill are here this morning to answer questions later. So that's the structure.
The objective of the Integration Group is just what it says -- that is, to take all this massive amount of information that will be delivered up by the various panels, and make sure that it's integrated across the total so that we have an understanding and come out with a useful, composite set of information that will guide us as we go forward into the future.
The Strategy Panel is what you think it would be. It is the issue of what is the world we live in; how in the context of that world do we have a strategy that allows us to shape and have an impact on that environment, and at the same time respond to crises if they occur. We will be looking at ways to experiment and examine different ways of dealing with strategy because we are concerned here that we have, throughout this, innovations of various sorts.
Secondly, we have a Force Structure Panel, which again, is what it looks to be. It's an issue of the tension that we have in the sense that we must create a large, capable, responsive force, but we have to do that in a context that allows us enough resources to build for the next and the next force through our modernization programs.
There will be a particular emphasis here in terms of force structure with respect to execution, joint execution of various capabilities, because we think in the world we live in and the world we are facing, joint capability is very, very important. As I said earlier, everything is on the table here.
Modernization is critically important. We have, we think, a strong modernization program. We would like to see that modernization program be substantially stronger. There is obviously a tension between what resources we spend currently on current operations and what resources we spend on investment, and the issue here is what ought that modernization program look like, and how large should it be as we go into the future.
There is an emphasis here in terms of the revolution in military affairs and how, in fact, that gets translated and manifested in terms of the modernization program. What exactly are we doing in terms of the implementation and utilization of advanced technologies in terms of communications, in terms of stealth and precision and so on. That's a particularly important emphasis for us.
As the Secretary mentioned, infrastructure is important not only because it is critical to providing to the warfighter the capability that is needed, but also because we think there are opportunities here, while protecting the core capability that is necessary, to find substantial economies. So in the infrastructure we will be looking for those economies all the time, making sure that we have the capability necessary.
So if you think here about a revolution in military affairs, we think here also about a revolution in business affairs, in the way we conduct our business. We are going to be pushing here, also, for innovation in the way that is done in logistics, in supply, in maintenance, and so on.
Readiness is and will remain a high priority -- the number one priority for our force. We will continue to assure that that's the case. At the same time, we have to worry about that in terms of the quality of the force, in terms of OpTempo and PersTempo, and make sure while ready, they're able to do both crises response and also deal with major contingencies if that becomes necessary.
Finally, the Human Resource Panel, of course, is concerned with the issues of quality of life, the quality of our men and women, that we are providing them with the wherewithal not only in terms of compensation and housing and related very important attributes, but also in terms of their professional training, in terms of the environment in which they work and live and in terms of the support they need while they are conducting military operations.
So we have what we think is a very complete and comprehensive structure that will look at all of these various issues. The biggest problem from my point of view is we are going to have so much data we need to make sure as we go along we stay on schedule and that we, in fact, get the relevant necessary data that we need in order to do the integration, in order to at the end have a product which is valuable in terms of the future planning for the Department. Let me turn now briefly to the schedule.
There are two schedules displayed on this panel. One of them has to do with our own Department of Defense QDR schedule, and the other one has to do with the National Defense Panel called for in the authorizing bill last year.
We have launched the QDR already. As the Chairman mentioned, he has the responsibility for a report that goes to the Congress on May 15th. From our point of view, effectively May 15th is the end date in terms of the development, the internal development of the QDR. If we're not finished by May 15th not only isn't it responsive to this schedule, but it isn't responsive, more importantly, to our larger resource allocation and planning schedule for the rest of the term.
The National Defense Panel has a requirement to make a report at the same time, and then there is an opportunity at the end of this period for SecDef comments on the panel.
The panel itself is not yet formed, but will be this month. We're in consultations now. We've developed a list of people with respect to options. We are consulting, of course, with the Congress and having discussions, but I think we will be able to complete that by the first of the year.
I did not mention the fact that they have an input that's due to us on March 15th, 14th, which will be valuable to us, because we then will be about 75 percent done as we go into the May period. Then, of course, as I did indicate, we're going to have a critique in May. Then they have the responsibility for the alternative force structure on December 1st, and then their activities are terminated as of the end of the year.
I believe you know this is a panel of nine individuals who are private citizens, and who have to be knowledgeable with respect to the affairs of the Department.
Those are the fundamental comments I wanted to make. At the end of the day our emphasis on making sure we look at everything, making sure we deal in terms of the new environment in which we live, being concerned that in fact we explicitly deal with these various tensions with respect to structure, with respect to readiness, with respect to modernization, and that we deal with them with enough specificity so that in fact we can provide guidance concerning policy priorities as we then subsequently go into the next round of our resource allocation and budget process.
As the Secretary said, this is decidedly not a budget process. This is a planning exercise so we can get above the budget and look at this in a much more long term fashion.
With that, I'd be happy to try to answer any of your questions.
Q: Secretary White, although you say that this is a strategy process rather than a budget process, the Secretary pointed out right away that there's an iron connection between the two; and you've talked about future budget cuts. Given the fact that you have very expensive programs underway like the F- 22, the Joint Strike Fighter, and you're cutting the budget at the same time, is it reasonable to believe that you can continue this two-war strategy and still have those programs? Isn't something at risk here?
A: I think fundamentally, we are operating within this budget constraint, and in that budget constraint we're going to have to examine what we can do effectively. And in doing that, there will be tradeoffs. We don't know yet what those tradeoffs will be. But inherently, we think there will be tradeoffs.
Q: Aren't you handicapping the National Defense Panel? You're supposed to have formed them by December 1st. You obviously missed that deadline. They've got a deadline, their first report, earlier than yours, and they won't be formed, they won't be staffed, they won't have done the preliminary work that the JCS has done. You're really putting them behind the eight- ball on this.
A: I don't think so. We've talked a lot about that, and the urgency with respect to that panel. We are in the very early stages of what it is we're doing. There is not a lot there yet in terms of information that they will need in order to assess what they need to do. So I'm perfectly comfortable, as long as we get it set up very soon, that we have not handicapped them. That is not our intention. We're going to provide them with the resources and the capabilities they need.
Q: Will defense agencies come under your review? And if so, which study panel would handle that?
A: The answer is yes, they will, but when you think about what the nature of this review is, they will really enter in in terms of their support for whatever it is in terms of strategy, modernization, readiness, and so on. So their inclusion will be in terms of the issues under the various panels, depending on which functions they perform.
Q: Are you giving the people who are going to do this review an assumption of how much money there's going to be in hand, like say $250 billion plus inflation? And secondly, on that same point, if so, and this is the way Senator Grassley and others have said it should be done, but I'm not trying to give a proposal on what you should do -- just trying to understand what your guidance is going to be. It would be different, would it not, from when Secretary McNamara came in and he said my mandate from the President is to find out what we need and then cost it out, as opposed to how much we're going to have to spend on defense and then go from there. Which are you going to do, and do you have a figure of guidance?
A: We're going to do the former. That is to say we're going to operate in the President's budget guidance to us which... $250 to $260 billion...
Q: For the next five years, is that the assumption?
A: In real terms, yes. That's correct.
Q: So we're talking about roughly $250 plus inflation.
A: That's correct. So we're talking about basically current program size plus inflation.
Q: If you have to give up the two war strategy because it doesn't fit in that ceiling, so be it?
A: We're going to look at everything, and then we're going to decide what fits and what doesn't, but more importantly, what's important and fundamental in terms of the requirements that we have to meet in terms of our national security. And out of that, as I said earlier, there will have to be some choices made.
Q: What's going to ensure that this just doesn't come up with fiddling around the edges and just a smaller version of what you've got already? What kind of people are you looking for for this outside critique, and what kind of guidance are you giving people? How far can they push the envelope on what they're going to look at doing?
A: Let me answer the second first. This has to be a more fundamental review because, as I indicated earlier, based on our experience, one, the world has changed and is changing, and we have to be responsive; and two, we have the tensions which you all are familiar with of the choices that have to be made year after year between readiness and quality of life and force modernization. We have to settle on, in the larger sense of our priorities, how we're going to deal with those tensions.
I have, this week, been spending a substantial amount of time dealing with the senior leadership in each of the services in private meetings -- I've done two, the Navy and the Air Force so far, I'll do the Army tomorrow -- in which my message is -- effectively the same message I've given you here today, with obviously some more detail to it -- and the emphasis on the requirement that we be realistic and be collegial in terms of making and adjusting to the changes that we have to make, and then answering their questions and being responsive.
With respect to the panel, this is an enormous task these people have. They have a limited amount of time. So we are looking for people who are knowledgeable with respect to defense concerns; we're looking for people who in our judgment will be questioning, people who in fact will not take as given what it is we say, but in fact are intelligent and experienced and ask penetrating questions and will be pushing the envelope from our point of view to make sure that we do everything necessary to make this a successful review.
Q: Will the QDR consider more base closure rounds?
A: The QDR will consider base structure. Maybe we ought to put that other chart back up. The infrastructure will consider the structure we have and whether or not it's the structure we need.
Q: Can you talk a little bit about the ability of this panel to challenge policy that is outside this building? Your missions are driven by policy that is laid down by the rest of the government. Will this panel be able to say, 'well gee, maybe we shouldn't do as much in the Persian Gulf', and that would totally change your commitments of force, for example. Will you challenge any of America's commitments as a way of getting at some of your...
A: A two-part answer. First of all, no, this is a DoD National Security Panel. We are not going to be challenging larger presidential policies with respect to, for example, what you mentioned or force deployments in the Far East and things of that sort.
Secondly, we will have involved in this people from the National Security Council, people from OMB and so on. We have invited the rest of the government, the relevant agencies to come and sit with us so that they can give inputs and also we can have a dialogue with them.
Q: What about structure? For example, the Secretaries of the various services. Will you look at structure? In your past incarnation, you guys decided not to really go after, or to look deeply into that issue. Will you be doing those kinds of...
A: We will be looking at structure, yes. And in addition to that, parallel to this effort we have ongoing now, an OSD study which is a lot more than structure but does include the structure of the Office of the Secretary, yes.
Q: When will the recommendations be implemented?
A: Most recommendations around here, most of them will be implemented in the subsequent program process. That's the way we do things, and that's the appropriate way to do things. So this will be a front end to program and budget reviews into the future.
Q: If it gets bogged down, it will then hurt the future...
A: Absolutely. That's why A, we not only have to do it right, we have to do it on time.
Q: When will the National Defense Panel be appointed: Or have you already got the names?
A: My plan is that we'll have it done by the end of this month.
Q: Is this finally acknowledgment on the part of the Defense Department of what outside critics have called a train wreck between future requirements and future resources?
A: Not at all.
Q: Are the current plans affordable?
A: I don't think it's a train wreck at all. As the Secretary said, we think in terms of the BUR strategy and what was developed four years ago, it served us very well. The world has changed. It's time for us to reassess.
Q: Where do nuclear weapons fit in on this? Is there going to be a new nuclear posture review?
A: There will be, as an element of this total study, a strategic review, just as there will be on other issues. So it is not separate in this regard from where we are, it will be part of this review, yes.
Q: All the services have set up offices to tell their story and to protect their piece of the pie, and it's most elementary here. To what extent will this ten divisions of the Army versus 18 active Air Force wings versus 300-some-odd Navy vessels...
A: I don't know the answer to that question or any other specific allocation or choice questions at this stage. What we want to make sure is that everything is there and we want to debate the various structures, sizes of various forces, numbers of platforms, etc., in this process, and things will change as they fall out.
Q: But traditional budget shares, the 30/30/25...
A: I don't know how that's going to come out. I literally don't know. We are not locking that in.
Q: Do you think this will be able to affect the FY98 budget?
A: No. We're going to submit the FY98 budget substantially before we're finished with this.
Q: Right. I just wondered if you think Congress will be able to have time...
A: That may be. This may be part, as we get back into the back end of this, in terms of the debate on the Hill it may affect the final outcome from the Congress, but in terms of the President's budget, it will not affect it.
Q: What will be the affect of the transition in leadership in OSD on the QDR?
A: Effectively we don't see any real change. That is to say, we are on a schedule, we have to stay on that schedule or we can't meet it. I have talked with Senator Cohen about that. He understands that. He obviously cannot be involved in this process until he is confirmed and sworn in as Secretary. So he will have to, we'll make that adjustment once we make that change.
Q: Will that slow it down, or...
A: It will not slow it down. We can't afford to slow it down and meet our schedule.
Q: Will there be room for minority reports? What I have in mind is supposing in this review there is one school of thought that says we'd be better off going to a one war strategy or something less than the two MRC...
A: The answer is yes.
Q: Will the President get the two opinions?
A: The answer is yes, there is, but my own view is that most of that will come out of the NDP, out of this panel. That's why that panel was set up, to assure that there would be alternative perspectives. So you have the Chairman giving a report in addition to what we create corporately as a Department, and then you have the NDP giving a critique on that. So I think you can be assured you'll get minority reports.
Q: . ..split opinions. They want to stick to the two MRCs; your civilians want to go one. Would the President get the benefit of both reports?
A: I think at the end of the day the Department will come together with one report. If there's such a split, I suspect you all will know about it.
Q: You mentioned that the world changed since '93 when the BUR was done. I thought maybe you could tell us how it's changed, if it's changed all that much. A second question is, how much involvement will there be in this process from U.S. allies? Obviously they're thrown into this equation of two MRCs. Will they be consulted in... I guess the question is, is some of their force structure looked at too, to see...
A: I expect not with respect to the latter. We've talked to a number of the allies about this. We've told them we will keep them informed of this process. Obviously they have comments and suggestions and they are welcome, but we will not have a formal process by which they will be included.
On your first question, just very briefly, if you look, for example, at the number of crises and various contingencies that have either been at least proposed or in fact executed on, I think you will find that it's more than would have been anticipated. Secondly, if you look at the issues around OpTempo, we are very concerned about that. There is continually upward pressure with respect to OpTempo because we live in, obviously, a very dangerous and changing world. Thirdly, I think people today, even on this short period, are more aware of the interconnectivity of the world we live in. Fourth, we look around the world and we see substantial changes in terms of the changes in the character of various governments, if we look at Eastern Europe, if we look at Latin America and so on. So I think there's a whole set of areas where the changes have been substantial.
Q: Secretary Perry has said this is going to be a review of the threats and response to threats. Is that also going to include such threats as terrorism on the military forces? And what is your opinion about the Air Force's review that finds the Air Force is not responsible for Saudi Arabia...
A: First of all, it will absolutely include the full spectrum -- all the way from terrorism on the one end to weapons of mass destruction on the other end. So that is critical to doing this. We have recently put an increasing amount of emphasis in the Department on force protection and terrorism on the one hand, and on counterproliferation and weapons of mass destruction on the other hand, and that will be reflected in this report.
Secondly, I'm not going to comment on newspaper reports with respect to the Air Force review. The Air Force has not transmitted forward to me or to the Secretary a formal report with respect to its review, so I won't comment until they do.
Q: Will the review be the last word, or would you...
A: I have not seen the report.
Q: Aside from the newspaper reports on the Saudi Arabia bombing and whether or not the United States might be targeting Iranian targets on a contingency... Has the United States determined, made a final determination on whether or not there's blame to be laid in the Khobar Towers blast? Has a final determination been made?
A: Mr. Freeh is involved, and I've talked to him as recently as last week in the continuing investigation with respect to Khobar Towers. He certainly has not completed that review, and therefore, he's not made his report to the President, and therefore, we don't know what those results will be or exactly when they will come out.
Thank you all very much.
Press: Thank you.