SEC. GATES: Thank you all for being here this morning, although I've been around long enough to know that probably not all of you volunteered.
June 30th marks the end of my four and a half year tenure as secretary of defense and will mark just about two months shy of 45 years since I entered government service.
As the introduction said, I began my government career in the Air Force. I was commissioned on January 4th, 1967. And so I wanted to make a special point of visiting with airmen on one of last trips as secretary.
As a former airman, I've been committed to maintaining our military's uncontested dominance of the skies. So while pushing to get more UAVs and preparing for high-end -- (inaudible) -- I've also been committed to modernizing and preparing for high-end air threats. That includes new radar capabilities for the F-15E, modernization of the F-22, and restructuring the F-35 program to ensure that we get this new fifth-generation aircraft in a timely and affordable manner.
The Air Force -- you -- are playing a critical role in the fight in Afghanistan, as you have in Iraq. Almost all of you are either just back from a deployment or are headed there soon. So I wanted to come here and thank you for your service, for your sacrifice, and also to ask you to -- each of you to thank your families for their support to you. Only their support makes possible your service.
Last year there were 37,000 close-air support missions in Afghanistan, 9,700 medical extractions. There are a lot of people on the ground in Afghanistan today who are alive because of airmen like you and those who support those pilots.
Nor have I forgotten that I was in the White House as deputy national security adviser when the first President Bush sent the Air Force to war in Iraq in January of 1991. So for all practical purposes, the United States Air Force has been at war for 20 years.
I've had no greater honor in my life than to serve and to lead the men and women of the United States armed forces. And I will tell you it's about the only part of the job I'll miss.
I also want to thank the opportunity to thank the members of the wider Goldsboro community for the strong support that they've given to you and to your families.
And with that, I'd be happy to take some questions or hear any concerns that you have. And then we'll get some pictures and hand out some coins. So there are some microphones around, and we'll open it up and see who the first courageous soul is to ask a question. Right here.
Q: Good morning, Mr. Secretary. Sergeant Seabrook (sp) with the 4th Operations Group Intelligence. With the lack of involvement of our Southwest Asia partners with the location and capture of Osama bin Laden, has it called into question their commitment to the level of support we're providing and the level of support they provide to our mission there? And is it going to reduce the -- or affect the president's decision as to whether we reduce forces?
SEC. GATES: Well, I think in terms of the impact of the killing of Osama bin Laden, in terms of the situation in Afghanistan, I think that there is a possibility that it could be a game changer. Bin Laden and Mullah Omar had a very close personal relationship. And there are others in the Taliban who have felt betrayed by al-Qaida, that it was because of al-Qaida's attack on the United States that the Taliban got thrown out of Afghanistan. So we'll have to see what that relationship looks like.
Frankly, I think it's too early to make a judgment in terms of the impact inside Afghanistan, but I think in six months or so we'll probably know if it's made a difference.
You know, our relationships with a number of countries out there are what I would gently refer to as complex. And just to take Pakistan as an example, if you had told me two and a half years ago that Pakistan would have 140,000 troops in the west, pulled from the Indian border, that they would have suffered thousands of casualties in the war in the FATA (Pakistan Federally Administered Tribal Areas) and elsewhere, that they would have driven the Taliban and al-Qaida out of South Waziristan and Swat, I'd have said that's not going to happen. But it has.
They allow our -- huge percentage of our support and sustenance comes through Pakistan, both ground and air. And those have -- those lines of communication have stayed open. They tinker with them every now and then just to get our attention, but they've really stayed open. And even with the development of the Northern Distribution Network, they're still vital to us.
At the same time, there's no question that they hedge their bets. Their view is that we have abandoned them four times in the last 45 years. And they're still not sure we're going to stay in the region. They saw us leave after the Soviets were thrown out of Afghanistan in 1989, 1988. And they're not confident we won't leave again when we've accomplished our mission in Afghanistan.
So we just have to keep working at it, and on both sides. I will tell you that the relationship cross border in terms of going after people has gotten steadily better in terms of being the hammer and the anvil with the Pakistanis being active on one side and our forces and the Afghan forces on the other.
So I would say it's a relationship we just have to keep working at.
Q: Thank you, Mr. Secretary, for your frank answer.
Q: Mr. Secretary, Captain Jennifer Morton from the 336th Fighter Squadron here at Seymour.
Now that we're pulling out of Afghanistan starting in July, do you see our focus in the military moving to any other area of operation? And if so, where?
SEC. GATES: Well, I think it remains to be seen, first of all, whether we will have a continuing presence in Iraq after the end of December. I think there's a general feeling among many Iraqi leaders that a continued presence is necessary. But at the same time, it's a heavy political lift for them. And whether they can come together and get agreement on a new agreement with us that would keep some of us there for training and for counterterrorism and providing air defense and so on, I think we just -- we just have to wait and see.
We will begin the drawdown in Afghanistan in July. But at the same time, we recognize -- and it was recognized at the NATO summit last fall in Lisbon that we don't expect the transition to Afghan security lead to be completed until the end of 2014. So we will still have a robust presence in Afghanistan for at least the next three years. And the president has been clear that the pace of the drawdown will be conditions-based.
So I think that while we will see some gradual drawdowns and -- beginning in July, I think that how fast those drawdowns go will depend largely on the situation on the ground.
In terms of other places, you know, we have -- since Vietnam, we have an absolutely perfect record in forecasting where we will use military force next. We have never once gotten it right. Whether it was Grenada or Panama or Haiti or the Balkans, we've never predicted it more than -- even six months before.
So if there is -- if there is any lesson, it seems to me, over the last 35 years, it is that we can't predict where problems will require the engagement of the United States military. If you -- you know, again, if you had told me in December that we would be significantly involved in a military operation against Gadhafi in Libya, I'd have taken that bet.
So we just -- we just don't know, to tell you the truth. And that's why we have to be prepared. And the argument that I make to our own folks as well as to the president and the Congress is as we look at what we buy and the capabilities we have, particularly in a period of constrained budgets, we have to buy capabilities that have the maximum possible flexibility for the broadest possible range of conflict, because we just don't know where trouble spots will occur.
I remember, in the fall of 2008, Secretary of State Condi Rice telling me that -- she kind of did like this, and said: Piracy? Piracy, for God's sake? The last American secretary of defense that dealt with piracy was Thomas Jefferson. (Laughter.)
So these problems just keep cropping up. And one of my arguments, in terms of being very cautious about significant cuts in the defense budget, is that four times in the last century after a war we have significantly reduced our military capabilities, thinking that the world had changed, that challenges had gone away, that -- as one so-called scholar said after the end of the Cold War that -- the end of history. Human nature hasn't changed. There will always be despots out there. There will always be aggressors. There will always be tyrants. And so we'd better keep our military capabilities strong as we look to the future, because we can't tell what the future holds for us.
Q: Secretary Gates -- sir, right here -- good morning. Major Egger (sp), from the 4th Maintenance Group.
First of all, Mr. Secretary, thank you, thank you, thank you for giving us the resources to kill bin Laden. Thank you for your role in that, sir. (Applause.)
And my question with respect to resources is, do you think the current budget crisis is a threat to our national security? And if so, are the people who are charged with solving the budget crisis -- our congressmen, our senators -- by extension, are they a threat to our national security? (Laughter.) I know that's kind of a trap, but -- (laughter) --
SEC. GATES: (Laughs.) Ya think? (Laughter.)
Q: Well, they can't fire you, so -- (laughter) --
SEC. GATES: That is a -- that is a seriously loaded question. (Laughter.)
First of all, in the long term, there is no question in my mind that our nation's fiscal condition is a threat to our national security. Never before have I traveled in an official position and not had behind me the most economically dynamic, richest, resource-intense, powerful country and government in the world. It still is all those things, but the crisis is just over the horizon. And to mix my metaphors, unfortunately, people have just been kicking this can down the road for years. Everybody knows it's been coming, and it just gets a little worse.
Before Christmas, I gave -- I had just finished a new biography of George Washington by an author named Ron Chernow. And I gave President Obama a copy of it. And I copied out in handwritten -- handwriting, a passage from that book. And it is a passage that George Washington wrote in 1778 on the Congress. And he talks about how they seem preoccupied with their petty quarrels and disputes, and the nation's finances are in ruin, we're in debt, we can't pay our bills, and they act like the problem -- they behave as though the problem will never come to our doorstep. So, some things never change.
I might say from the Washington -- Washington's time as president, one other thing that doesn't change is the way procurement gets done. When he asked Henry Knox, his first secretary of war -- our first secretary of war -- to build six frigates to fight these pirates, the only way they got the funding from Congress was to build the six frigates in six different shipyards in six different states. (Laughter.)
I think, you know, the reality is, as I look back on the decades that I've been involved in government, it is characteristic of democracies that they only deal with major problems when confronted with a crisis. It really requires -- you know, all through our history, people will try and put off dealing with a crisis for as long as they can, until there's just no way to avoid it any longer.
I think if there's a consensus in Washington on one thing, it is that we cannot put off dealing with this crisis any longer. And that gives me confidence that although the whole thing will probably end up looking like "The Perils of Pauline," they ultimately will reach an agreement and will be able to move forward.
I think the key thing here for us is the part that defense plays in that. And regardless of -- and we cannot have a strong defense without a strong economy. There are just no two ways about it. And so I think there are some savings that we can realize. I think there are some things that we can do, and I think we will have to do those.
But what I've been trying to do, in dealing both with the Congress and with the White House, is say let's not do this as math, as opposed to strategy. Let's take a look at our capabilities. Let's look -- take a look at our scenario-based force planning and where can we take additional risk. And I want to try and create a decision process that provides the president and the Congress with options; that says: Okay, if you want to reduce defense by this much, this is what -- these are the changes and assumptions you have to make, and here is the added risk that you face if you head in that direction, but here are the changes in force structure that we can make if you're prepared to take that additional risk. But I want -- I want this to be a risk-based assessment of where we go over the next 10 or 12 years, rather than just sitting down and doing math.
So I think that it's hard to say how this process will unfold, but I think if we have time to do this and can plan for it and deal with it intelligently, that we can do our part without weakening our national security.
Q: Sergeant Kemp (sp), out at EMS Ammo. I was just wondering, as your -- more of a personal question -- as your time closes as secretary of defense, what do you feel has been your biggest accomplishment and your brightest highlight as your tenure as secretary of defense?
SEC. GATES: Well, I think that the thing that I have given the highest priority to, after the wars themselves, has been to try and get our men and women in uniform whatever it is they need to be successful in their mission, to come home safely, and when they come home wounded, to ensure that they have the best possible care.
And I think that we have been able to do that, and that is the thing that perhaps I'm the proudest of, of all the things over the past four and a half years -- whether it's the MRAPs or dramatically increased ISR to support our troops; the part you guys have played a big role in, the -- assuring the "golden hour" medevac in Afghanistan that has made such a huge difference, taking care of our wounded warriors -- I think -- I think these are the things that have mattered the most to me. (Applause.)
Q: Good morning. Good morning, Mr. Secretary. Master Sergeant Carla Sanders with the 916th Maintenance Group. Going back to your statement regarding the risk-based assessment for cutting defense, has -- is it a concern that with all the fronts that we're on right now and the humanitarian efforts that we're making, that the military right now is stretched thinly?
And if it's a concern, why is it even a discussion that they would cut the defense budget? I mean, we're a volunteer force, and we're here willingly, but it's to the point where we're stretched so thinly that it's almost impossible to -- or it feels impossible that we're trying to do so much right now.
SEC. GATES: Well, there's no question that our military is stretched thin. And people have had, like many in this room have had, multiple rotations in both Iraq and Afghanistan, probably now also Libya. And that's clearly going to continue for at least a couple of more years. Our military forces have been at war for 10 years just about. And there is no question that our force is also tired.
We're going to require significant resources for reset. When the Army comes home, they're going to need a lot of new equipment just to replace the stuff that's been lost or damaged in Iraq and Afghanistan. So reset is going to be a big bill. China and Russia are already working on 5th-generation aircraft. And we must go forward with our 5th-generation aircraft, the F-35. We have to have a new tanker. It's unavoidable.
And so we've got some must-pay bills out there that, I think, the country -- that for our national security have to be paid. Many of the surface ships that were built in the Reagan administration under President Reagan are beginning to age out and will age out by the end of this decade. And do we really want that small a Navy, to go down to 230, 240, 250 ships? Will that enable us to meet the missions that are -- that are being given to us?
So what I'm trying to do is -- again, going back to the earlier answer, what I'm trying to do is put these facts on the table, at the same -- and in terms of risk and capability, as opposed to just kind of what makes the math work in terms of reducing the deficit.
My point, quite frankly, is that if you cut the defense budget in FY '12 by -- or in FY '11 by 10 percent, which in my judgment in the short term would be catastrophic, that would be roughly $53 billion. That's on a $1.4 trillion deficit. I do not believe we are part of the problem when it comes to the annual deficits.
Longer term, we have to do our part in terms of reducing the national debt and getting the budget back in balance. But people need to understand that defense has not -- the base budget in defense is not the cause of this problem as far as I'm concerned.
But we will do our part, and I -- and I think that the whole -- the whole process has to be one of looking at how we can -- if we have to reduce, how we can do so without hollowing out the military as we did in the 1970s and the 1990s. I mean, we've been here before. We know how this works. And the worst of all possible outcomes, in my view, would be an across-the-board percentage cut across the services. My view is, that's basically managerial cowardice.
We're going to have to make choices and decisions. And if we have to be smaller, I still want us to be superb. I still want us to be the best in the world. And that means enough flying hours, enough steaming days, enough tank miles so that our forces still have the resources and the capabilities to be able to do the kinds of thing that just happened last Sunday and the kind of thing you all do every day.
So we're looking at several different pathways of analysis. One is, what more can we do in terms of efficiencies? The defense budget almost doubled in the 19 -- in the 2000s, between 2000 and 2010. A lot of that was inexorable things, like the cost of retiree health care. Our military health care budget has gone from $19 billion in 2000 to $53 billion this year. We're being eaten alive by the thing. It's 10 percent of our budget at this point.
So -- and -- but I think in that 10 years, there's also been a growth in overhead and infrastructure that we can take another hard look at and see some more savings -- by consolidating headquarters, by reducing the number of contractors we depend on, particularly for management services and professional services, not when it comes to maintenance and things like that.
A second category is marginal missions and marginal capabilities; what missions do we have that we can tell the country we don't think we need to do these, we should stop doing these things.
The third and hardest category strategically is what I was talking about earlier, how do you -- how do you change your assumptions about how you are going to fight in the future in a way that minimizes risk but also points toward where you can have reduced capabilities.
And I'll just give you one example. The assumption behind most of our military planning for the last -- ever since the end of the Cold War has been having the capability to fight two major regional wars simultaneously. Well, what if you told yourself, I actually don't think we're going to have two wars simultaneously, and so if they're not going to be fought simultaneously, but sequentially, perhaps, then what are the implications of that for force structure, and what are the risks? Because you're making an assumption that it won't happen; and unfortunately, the enemy always has a vote.
So -- and then the third -- or the fourth bin, if you will, are what I call third-rail issues: base closures, military health care. And again, we're not talking about the active force, we're talking about working-age retirees, we're talking about military retirement.
Now, just so everybody will know, I think it is politically impossible to change military retirement without essentially grandfathering everybody who's already in the service. So relax. (Laughter.) I just think politically it would never pass.
But some of these issues are going to have to be tackled as we look out the next 10 years or 12 years. And so those are the four avenues that we're looking at.
But I want to do this in a thoughtful and sensible way that protects our national security while doing what we need to do to help deal with this budget problem.
Q: (Off mic.)
SEC. GATES: I think you get the last question.
Q: (Off mic) -- and considering that you've been in the intelligence community for basically the majority of your career, if not all of it, you've been there for some of our major failures, such as the Khobar Towers and 9/11. Now, considering the restructuring as well as the organizations that you've stood up, do you believe that the intelligence community is sufficient at this moment to deal with these issues of national security, or do you think there's more that we can do in order to improve that in our department?
SEC. GATES: Well, intelligence is always a work in progress. I will tell you that what happened last Sunday could not have happened without brilliant intelligence work by CIA and by the military.
I think that one of the things we have seen since 9/11 is an extraordinary coming together, particularly of CIA and the military, in working together and fusing intelligence and operations in a way that just, I think, is unique in anybody's history. I think it's part of a revolutionary -- a revolution in military affairs, if you will.
When I was on the Iraq Study Group in -- well, let me say, after Vietnam, the military and CIA grew apart. With the end of the draft -- when I joined CIA, virtually every guy in CIA had served in the military. After the end of the draft and after the end of Vietnam, the two cultures drifted apart. And military came to feel that they got no support in operations from CIA.
And so when I became director in '91, I decided to try and fix that. And working with Colin Powell, who was then chairman of the Joint Chiefs, I appointed a two-star as the number-three person in the clandestine service at CIA. And this is an effort that all of my successors sustained and built on.
So when I was in Iraq with the Iraq Study Group in September of 2006, I met with the chief of station for a couple of hours. And at one point in the conversation I said, so, how's it going between CIA and the military? He said, oh, sir, it's so much better than when you were director. (Laughter.)
I think we have capabilities that we've never had before. We've learned so much in Afghanistan and Iraq about the use of UAVs and about the importance of full-motion video and all the things that have been formed -- the operations that we've had on the ground. I think that, overall, the quality of intelligence is probably as good as it's ever been and I think, in some areas, better than it's ever been, particularly in support of military operations.
But it is one of those things where people need to keep working together and need to keep at it. And this is another area where a lot of investments have been made over the past 10 years and we have to make sure -- you know, along with the military, we particularly in the early '90s and in the late '70s, went a long way towards dismantling our intelligence capabilities as well. So we just have to avoid these kinds of mistakes, I think, in the future, or we will lose a lot of the progress that we've made.
But I would say that -- well, I would just -- I would just leave it at the fact that I'm really -- coming back into government four and a half years ago, I was impressed at how much progress has been made. And since then, I think there has been even more progress in both working together but also in the tools that are available. And so I'm actually fairly optimistic about the intelligence world.
So with that, I'll go over here in front of the plane, and we'll take some pictures and hand out some coins. But thank you again. Thanks, first of all, for your patience this morning; and second, thanks again for your service.