MR. KING: Mr. Secretary, thank you for your time.
Let's start with the bold challenge you've laid out since you're not looking outside the building, you're looking inside the building and inside the culture. You have an annual budget that's just shy of $700 billion. When you talk about come to me with serious significant savings, what's the number you're looking for?
SEC. GATES: Well, the key is to be able to sustain our force structure, the number of Army brigades, Marine regiments, Air Force aircraft and Navy ships, we need between two (percent) and three percent real growth above inflation every year. We will get just under two percent in Fiscal Year '11, but we'll be under one percent for the next four years and we'll be lucky if we go ahead and get what has been laid out.
So I want to shift enough money from the overhead and bureaucracy if you will to the tooth part of the military, to the forces that the forces and our investments in future weapon systems will meet that two (percent) to three percent standard.
We haven't really run the numbers in any detail at this point, but it's probably on the order of $10 (billion) to $15 billion in FY '12, something like that and doing it just these onetime haircuts of two or three or four percent is not what I'm after. We need to change the way we do business in a way that these savings can be sustained over time and plowed into the business end of the Department of Defense.
MR. KING: In doing that, you're asking people in a culture that is resistant to change, as you well know, to essentially give up, my word, not yours, they're fiefdoms. So when we come back in a year and you say here's my proof that I meant what I said, are we going to see fewer commands in Europe? Are we going to see maybe a reassessment of whether we need an African command? Do we need a European naval command?
SEC. GATES: Well, I think everything is on the table, frankly. I'm willing to look at everything that there is, that's the only way we can do it. As I said in my speech, this has been tried before. I think there are a couple of things that are different this time, one is I'm going to try and do this in a way that incentivizes the services themselves, in other words, if you cut in the past often when they've been asked to cut their overhead, the Department of Defense has taken that money away from.
What I want to try and do is structure this in a way that for the most part, money that they save on the overhead side, they get to spend on their own weapons and on their own forces. So they see the benefit to themselves that these things are very hard for the services to do on their own because of all the different conflicting interests and everything else.
So with pressure from above, from me, I think it gives them the top cover, the leadership of the services to be able to make those transfers.
The other thing that's changed is that, you know, in the past, particularly after 9/11 with the supplementals, the Department never had a great deal of discipline in fiscal matters, but discipline really went out the window with the supplementals.
And so I think that there's been a lot of growth in this bureaucracy over the last 10 years that makes for what I would call a target rich environment.
MR. KING: Target rich environment. So when you're telling the Army if you find the money, you get to keep it; maybe you find the money and you get to keep it. Do you have a personal code from the president in that regard? Because he's looking now at a deficit situation that's pretty alarming and so as he's looking across the government, if you come to the table and say, hey, I found $10 billion, there will be pressure at OMB or elsewhere to say we need that money for the health-care bill or we need that money for something else.
Do you have the president's commitment that what you find, you keep?
SEC. GATES: Well, I wouldn't have given this speech or undertaken this initiative without talking to both the president and the director of OMB to make sure that that would be the case. What I am saying is that we will do this within the top line numbers that they've given us for the next five years and that's my commitment to them.
MR. KING: And you believe you can do that without any impact of what you need to do today -- (inaudible) -- Iraq and Afghanistan at the moment but could be asked of you tomorrow wherever that might be in the world?
SEC. GATES: Sure. Because activities like Iraq and Afghanistan are paid for through the overseas contingency operations fundings or supplementals. So that really covers most of the costs associated with the war and now there are some things associated with wounded warriors, family support, resetting the force after the war and so on that will have to come out of the base budget. But most of the war funding is separate.
MR. KING: So what you're asking for the bigger, expensive things as you know politically gets interesting. You have a Congress that sends you things you don't want anymore. You have a Congress that in the goodness of its heart has ticked up pay for men and women in the military a little bit more than you would like, that has not listened when you have said we need to maybe control, the growing in your own health-care budget. Do you think you can get a commitment from the Congress to listen to you in those regards?
SEC. GATES: Well, I think that's the big unknown and I certainly hope so. I think there are those on the Hill who will be helpful and supportive in this effort. I think in principle most members of Congress will be supportive of trying to reduce bureaucracy and overhead and change that, convert that money to spending on troops and our forces. The question will be when it comes down to specific programs that may impact their own district and that's always a fight, although I must say for Fiscal Year '10, we sent, we made thirty-some tough decisions and Congress supported us on 30 of them, cutting a lot of very big programs. So I guess I'm hopeful.
MR. KING: It's a challenge of your personal credibility to say you're going to do this within the building. You know how the budget cycle works and this was something I was going to ask at the end, but I'm going to add it now because it raises the question of how long you're on the job, that if you're going to do this in the next budget cycle, to really know if you succeeded, we have to have a conversation about this time or a little bit later next year and you've told the president you would stay through Christmas, through the end of this year. Are you now prepared to stay for a significant amount of period longer to say, I told you I was going to do this, here it is, I've done it?
SEC. GATES: Well, the president and I agreed that I would stay for at least another year, that was last January and we'll just see. As the old saying goes, the cemeteries are full of indispensable men. So I think if we get this thing started and underway and structured in the proper way, that provides some opportunity.
MR. KING: Do you think you'll be able to know the answer to that question by the end of the year or would you have to stay on at least for a decent period until the next year?
SEC. GATES: Well, we'll just see how fast I can make progress. It gives me an incentive to hurry.
MR. KING: Let's look at some of the other challenges in the world and the Times Square bombing has not come across your desk in a major way, it's my understanding, but I want your sense as how you see it as a reflection of the changing threat, that you have a naturalized American citizen who went to Pakistan, received training of some sort and still try to sort some of that out.
What does it tell you about the diversity of the threat, if you will, the diversity of the challenge?
SEC. GATES: Well, I think what we've seen, there are two developments that I think are of concern, one is as we saw in the Christmas bomber and in this case, you're seeing individuals who have been radicalized and who hold American citizenship who have been willing to undertake these missions against us. And it's pretty clear that people like al Awlaki in Yemen and others see any kind of an attack inside the United States even if it's a small scale attack compared to, say, the World Trade Center towers who see that as a success for them.
So that makes the challenge for the FBI and the intelligence agencies and the Department of Justice and local police that much tougher because you may not have a big complex plot involving a lot of people that might be easier to detect.
So I think that kind of threat where the threat of large-scale harm is reduced, but the likelihood of some kind of an attack being successful is increased and I think that's a concern.
The other concern we have really affects what's going on in Afghanistan and Pakistan and that is the creation of the syndicate of terrorist organizations that are working with each other, al Qaeda, the Taliban in Pakistan, the Taliban in Afghanistan, the Haqqani Network. There are five or six of these groups that are now really working together and a success for one is a success for all. And they're looking at destabilizing the whole region and overthrowing, not only the Afghan government, but the Pakistani government and so on.
And so this problem has become more complex as these groups have gotten closer and cooperated operationally in a way that we really haven't seen, I think, significantly before 2007, 2006.
MR. KING: And has that changed your challenge and the challenges you present to your counterparts, let's start in Pakistan for the moment. Will you go to them and say we need you to deal with this? Is it a more fractured, more intelligence on an organization environment, organization like organized crime in the sense that less military, more intelligence?
SEC. GATES: Well, where it actually has been helpful is that as Pakistan has seen these bombings on its own territory it clearly has seen a greater incentive to go after these guys. And so the Pakistanis have sent a number of brigades to the western part of the country and frankly, 18 months ago, I wouldn't have believed that they would be active in South Waziristan and Swat and these other places.
So the Pakistanis because these groups are working together and because they, Pakistan itself in their cross-hairs now, the Pakistanis have been much more cooperative and much more helpful with us operating independently, but coordinating better on both sides of the border.
MR. KING: And what about in terms of the things you need to do up in that area? I know it's a sensitive subject, but there are Special Forces operations from time to time, the drone operations, do you need more of that?
SEC. GATES: Well, I think we're doing what we need -- I would just say we're doing what we need to do.
MR. KING: You mentioned that you're surprised in some ways. In terms of grading the relationship now as opposed to, say, if we're having this conversation a year ago, in a way that just the average American watching understands the tangible results they're getting.
SEC. GATES: Sure. I would say and this is kind of a foolish thing, but on a scale of ten, I would have put the relationship at about a three two years ago. And I think it's probably at a six or a seven now. I mean, there's been a significant improvement in the partnering and in the cooperation.
MR. KING: And what keeps it from getting to an eight or a nine? Is that still some relations in the Pakistani government, in the security services with the bad guys?
SEC. GATES: Well, no, I think, first of all, it's more the Pakistanis themselves are stretched fairly thinly at this point in terms of the number of troops they have and their civilian capacity to come in behind their operations with development and aid and so on. They also are very sensitive to the size of the American footprint, the number of Americans on the ground in a training capacity or whatever. They're also extremely sensitive about their sovereignty and we have to respect those things.
So I think those are things that we're working our way through, but frankly as I've just indicated I think the relationship has been improving significantly and I expect it to continue.
MR. KING: How many Faisal Shahzads might there be in the United States? Is there any way to quantify it?
SEC. GATES: There's no way to know that. In the intelligence business we always used to divide everything we wanted to know into two categories, secrets and mysteries. Secrets were the things that were ultimately knowable. Mysteries were the things you couldn't know. The number of those guys is unknowable.
MR. KING: Unknowable. Let's move from Pakistan across the border to the Afghan challenge. President Karzai is on his way here and correct me if you don't like my description of this, but if you look at how that relationship has played out over the last several months, there are some bad cops in the administration, you have said pretty harsh things about him and there are some good cops who have said, you know, we don't like a lot of this, we wish things would move better, would move faster, would move in certain ways, they're not moving right now, but we can't kick him all the time. And you're usually put in with the good cops.
As he comes to the United States, again, what's your test of success of are we getting closer to where we need to be?
SEC. GATES: Well, I think that the big part of the visit next week is really about the longer term relationship between Afghanistan and the United States. One of the challenges we face with both Afghanistan and Pakistan is their suspicion that we're not in this for the long haul, that if we're successful, we will turn our backs on both of them and walk away as we did in 1988 and again in 1992 with the Pakistanis.
And so I think that part of the fundamental agenda for this coming week is for us to talk about what does the strategic relationship between the United States and Pakistan and Afghanistan look like going forward three years, five years, 10 years and so on and to give the Afghans a sense of confidence that we're really in this with them and we see them as a long-term partner.
MR. KING: In terms of on the ground, would you prefer, say, after this meeting they're going to schedule the jirga. Would you prefer that President Karzai wait a while before he engaged, especially at a more senior level with the Taliban until General McChrystal has more time to do this work?
SEC. GATES: Well, I think that's up to President Karzai. I think our view certainly is that any negotiations need the efforts of efforts at reconciliation need to be from a position of strength. We think that we are in the process of blunting the momentum that the Taliban had in Afghanistan and beginning to reverse that momentum. I think with each passing day, the position of the Afghan government becomes stronger in terms of being able to conduct those negotiations.
MR. KING: Is it fair to extrapolate from that if you had a couple more months, that President Karzai would be in a much stronger position than he might be in a couple of weeks?
SEC. GATES: Well, I think over time he will be in an increasingly strong position. But that doesn't mean he can't start having consultations and doing the kinds of things that I have the impression he's trying to do with the peace jirga.
MR. KING: Where do you draw the line in terms of the level of Taliban that you're comfortable with him talking to about reconciliation? Is it -- could you imagine a conversation with Mullah Omar, somebody at that level?
SEC. GATES: Well, just speaking personally, I think having that conversation with Mullah Omar would be pretty tough. But I think that -- that's certainly from my personal standpoint, that's kind of the list.
MR. KING: As you grow in Afghanistan, some of those not directly, but some of those numbers are coming out of Iraq, 96 (thousand), 94,000, somewhere in that ballpark right now, 50,000 is the target on the calendar, September 1st, but with all the uncertainty after the election, do you think it is reasonable now because you're still at it, 96 (thousand) to get to 50 (thousand) by September 1st? Could you possibly even move them that fast if you were prepared to do it and with the uncertainty right now and I know General Odierno is not in a hurry to do that.
SEC. GATES: Well, I think, yes, we are on track to be at the 50,000 and that certainly continues to be our plan. Should I just start my answer over?
MR. KING: Yeah. Just so that they tell me they're okay. Are you okay?
SEC. GATES: We are still on track to meet the August timeframe for 50,000 troops. I think while the election, post-election negotiations and government formation are stretching out, the truth is we expected it to take several months. So this is not an unexpected development at all from our standpoint. And I think one of the things that's the most significant compared with 2006 is that these guys aren't shooting at each other. The debate, the dispute if you will is political, politics as the vice president likes to say, politics has broken out in Iraq and we've had some tremendous successes in recent weeks against the al Qaeda leaders that we've been searching for a long time in Iraq.
So they can still do these isolated bombings and so on, but the fact that the different sectarian groups have not started after each other and so on I think is a hugely positive sign.
MR. KING: And that you would be under 96,000 and General Odierno didn't want to hold the pause button just a little bit longer just because of this uncertainty.
At what point, at what point in the calendar might you need an extra month or an extra six weeks to get down to the 50 (thousand) level if he just needs a little bit more time to get his comfort level there?
SEC. GATES: Well, the Pentagon plans for everything. But our intent, our policy direction, and our plans are all to be down to 50,000 on -- in August, as the president has directed and as we've told the Iraqis. And right now there's nothing on the table that tells us that we are not going to be able to make that.
MR. KING: You gave great hope to a lot of people in the gay community in America when you embraced the president's promise of ending "Don't ask, don't tell." Now there's a bit of a backlash because of the letter you sent to Congress saying we need time, we need to survey our troops. You have to give us until this survey is done; let us get feedback from the men and women in the military, then we will move forward. A lot of people think you're trying to stall or push this off. Maybe you have some idea of delaying it till after the election where there might be less support to do it in the Congress. What do you say to those critics?
SEC. GATES: Well, first of all, I said at the very time I first testified on this that we were going to conduct this review and how long it would take. I know there are some that are suspicious that this is some kind of effort to slow roll this process. But as I said in that testimony, I've led several huge public institutions and I've led change in every one of them and there's a smart way to do change and there's a stupid way to do change. This one has to be done smart. And I think it's only fair as we get ready to make this change, that we give our force the opportunity to tell us how they feel about it, for us to find out their concerns, for us to identify the challenges we're going to face if Congress does change the law and how we will go about doing that and how we will mitigate negative consequences by what we hear from the force.
And so I've said this is not about whether, but about how, and that continues to be our position. But I have also said to Chairman Skelton in the House Armed Services Committee that, frankly, I believe to legislate before this review is done would send a very negative signal to men and women in uniform that their views on this and how it should be done don't matter. And I think that's a very bad signal. I want to do this right. I want to do it in a way that makes as little impact on the readiness and capability of our forces as possible in the middle of two wars. So I really feel very strongly about this review process and about doing this change smart.
MR. KING: Did the politics ever come up in the conversation with the president about this where he says, I got it, Bob, I understand, I completely respect the process you're going there and I suspect he thinks it's the right process, but he's getting hammered from the left on this. Has that ever come up at all?
SEC. GATES: No. And my position with everybody on this has been very clear from the very beginning, with the Congress, with the president and so on. I support this change, but it needs to be done in a way that has the least possible impact on our military.
MR. KING: Another promise the president made that has been put on hold is closing Gitmo. Where are we in that process? And is this now something on your desk or is this more of a decision that's on the plate of Congress because it has refused to allocate the money for an alternative site.
SEC. GATES: I think really is in the Congress' hands at this point and the president. We have money, a proposal in the budget that we've sent to the Congress to close Guantanamo and to fund the military part of another prison here in the U.S. and we're waiting for Congress at this point.
MR. KING: Then if Congress doesn't give the money, then does Gitmo stay open indefinitely or is there some plan C?
SEC. GATES: Well, I think we really haven't explored what the alternative would be if the Congress decided not to fund this.
MR. KING: Where do you come in the political argument about the trials in terms of now there's KSM and the others are going to come to New York and there's an uproar. The mayor now says they can't afford it. Many in Congress say it's the wrong to do to leave them in the military system? And there's a debate about which helps the terrorists, the enemy more. Some people putting them on trial in a federal court, showing the American system, that's the right way to do it. Others say it gives them a propaganda platform.
SEC. GATES: Well, in a way, this is really a false debate. We have put terrorists on trial in this country for decades and put them in jail and they're still in jail. And the Congress has given us the military commissions as an alternative. I think having that choice of which venue that you use for a trial is a positive thing, and I think it’s basically up to the Department of Justice, quite frankly, to determine on a case-by-case basis which venue an Article III regular U.S. civilian court or the military commissions is the best place to prosecute a terrorist. And I think arguing that you can't do this in a civilian court simply flies in the face of facts of what we have been doing for decades.
MR. KING: What's happening in Iran? Around the time of the elections we saw the students in the streets. There was some hope that maybe something dramatic was happening and now it seems like that has been quashed down somewhat and things are back to where they were and we're back in the debate now about sanctions.
Has the regime clenched its fist? Is it back at full power? And when you look at the sanctions debate, the simple question, will it ever end? Will we get to a decision point in that debate?
SEC. GATES: Well, I think, first of all, I think the regime has been able to repress the opposition through the use of brute force, but they haven't solved any of the problems and those peoples' resentment and anger has not gone away.
I think the lingering impact of what happened in the election is a significant de-legitimization of the Islamic government in Iran with its own people. So things may be calm on the surface, but underneath, I think there are now serious divisions inside Iran, that they'll be able to keep the lid on for some period of time, but all experience suggests not indefinitely.
I think the sanctions have had impact. New sanctions will have more impact. We have the ability to target specific front companies and other things run by the IRGC and others that I think will help us be more effective.
MR. KING: So should there be a conversation for months and months more about trying to fine-tune them or should there be a decision as soon as possible on let's get the best package of sanctions we can get, let's put it in place, maybe it's not perfect but it's now.
SEC. GATES: Well, my personal view is the latter, because I think that we can get the resolution, first of all, the value -- the principal value of these resolutions is that they isolate Iran. And if it didn't matter for Iran, then I don't think they'd be working as hard as they are around the world to try and prevent this resolution from being passed. So it has a great political impact. But it also provides a legal platform for individual countries then to take much more severe actions with respect to Iran, and I'd like to get that legal platform in place and then let the individual countries get on with their own efforts.
MR. KING: A new question on the president coming from Congress and elsewhere to have the United States sign on to the land mine ban treaty. Good idea or bad idea?
SEC. GATES: Well, I think we need to look at it again. I went through this in 2007. We are in the process of replacing our inventory, if you will. We've gotten rid of a lot of land mines, but we are replacing them and there's a deadline for that, I've forgotten what it is, but in a year or two to have replaced them all with land mines that self -- they turn themselves off after a certain period of time, they basically self-destruct or make themselves inoperative so that you don't have the problem of mines strewn around as is the case in Afghanistan where innocent people get hurt.
MR. KING: Ask you lastly a political question -- (inaudible) -- politics more than anything else. It's fascinating whether it is a big security challenge and the administration wants to send out its lead voices and it sends out the Defense Secretary who is a holdover from the Bush administration and the Secretary of State who was the president's chief rival in the primaries and it's a fascinating political theater.
What is that relationship like? And in the green room conversations between yourself and Secretary Clinton, does that irony ever come up?
SEC. GATES: No, it really doesn't, but Secretary Clinton and I have a great working relationship and I think we see eye-to-eye on a lot of big issues, and frankly, I think the president has assembled a good team and I think the word team needs to be underscored because it's Jim Jones and it's people like Steven Chu at Energy and so on. I think it is a good team and I enjoy working with Secretary Clinton.
MR. KING: You don’t find that at all odd?
SEC. GATES: Well, I find my own situation to be a little odd just in terms of, you know, although I think there is value in sitting in the Situation Room and to be able to say, well, you know, we tried that in 2007 and it didn't work then and it's probably not going to work now or we should have tried it in 2007, but now maybe it will work. So I think maybe in that respect having some continuity brings some value.
MR. KING: Mr. Secretary, thanks for your time.
SEC. GATES: Thanks a lot.
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