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Opening Summary -- Senate Appropriations Committee-Defense (Budget Request)

Mr. Chairman, thank you; Vice Chairman Durbin, members of the committee, thank you for inviting me here today. And Mr. Chairman, I want to especially recognize the sense of civility and courtesy with which you conduct all you do, including the leadership of this Committee. It doesn’t go unnoticed, least of all by me, and is much appreciated. And Vice Chairman, I will make sure that we get to the issues you raised – both in our private conversation and just now – in the course of this, and thank you for your leadership. And thank you all for thanking my friend and shipmate, Marty Dempsey, for his wonderful service. I’m gonna miss him.

I know all of you on this committee share the same devotion that I do to the finest fighting force the world has ever known, and to the great – the defense of our great country. And I hope that my tenure as Secretary of Defense will be marked by partnership with you on their behalf.

I am gratified that this committee, as well as the three other defense committees, recognize the urgent need to halt the decline in defense spending imposed by the Budget Control Act. President Obama and I deeply share in that recognition. And indeed, I want to commend you and your colleagues for both recognizing, and saying, that sequestration threatens our military’s readiness, the size of our warfighting forces, the presence and capabilities of our air and naval fleets, our future technological security, and ultimately, the lives of our men and women in uniform. The Joint Chiefs have said the same – and they have specified the kinds of cuts that their services would have to make if sequester returns.

Over the past three fiscal years, the Defense Department has taken over three quarters of a trillion dollars in cuts to its future years defense spending. The magnitude of these cuts would stress the most capable planners and programmers. But the stresses have been made even greater because of the frequently sudden and unpredictable timing and nature of the cuts – as well as continued uncertainty over sequestration. And as a result, DoD has been forced to make a series of incremental, inefficient decisions – often made well into a fiscal year after prolonged continuing resolutions are finally resolved. Moreover, even as budgets have dropped precipitously, our forces have been responding to unexpectedly high demand from a tumultuous world. As a result, I believe our defense program is now unbalanced. We’ve been forced to prioritize force structure and readiness over modernization – taking on risks in capabilities and infrastructure that are far too great.

This is a serious problem. High demands on smaller force structure mean the equipment and capabilities of too many components of the military are growing too old, too fast – from our nuclear deterrent to our tactical forces.

Meanwhile, in each of the past several years, painful but necessary reforms proposed by DoD – including many significant reforms like eliminating overhead and unneeded infrastructure, retiring older force structure, and making reasonable adjustments in compensation – have been denied by Congress at the same time that sequestration looms. And we are starting to see this double whammy once again in markups of legislation this year.

If confronted with sequestration-level budgets and continued obstacles to reform, I do not believe that we can simply keep making incremental cuts. As I’ve said before, we would have to change the shape, and not just the size, of our military – significantly affecting parts of our defense strategy.

In recent weeks, some in Congress have tried to provide DoD with its full budget request for Fiscal Year 2016 by transferring funds from the base budget into our accounts for Overseas Contingency Operations, or OCO, meant to fund the incremental, temporary costs of overseas conflicts in Afghanistan, Iraq, and elsewhere. While this approach clearly recognizes that the budget total we’ve requested is needed, the avenue it takes is just as clearly a road to nowhere. I say this because President Obama has already made clear that he won’t accept a budget that locks in sequestration going forward – as this approach does – and he won’t accept a budget that severs the link between our national security and our economic security. Legislation that implements this budget framework will therefore be subject to veto. So if we don’t come together and find a different path by fall, when a budget’s needed, it will put our department and our troops in an all too familiar and very difficult position. We will yet again have to make very hasty and drastic decisions to adjust to the failure to have an adequate DoD budget – decisions that none of us wants to make. The Joint Chiefs and I are concerned that if our Congressional committees continue to advance this idea and don’t explore alternatives, then we’ll be left holding the bag.

That’s not where I want to be in six months, but since OCO – the OCO funding approach is not the kind of widely-shared budget agreement that is needed, we can see now that it won’t succeed.

Moreover, the one-year OCO approach does nothing to reduce the deficit. It risks undermining support for a mechanism, OCO, which is meant, as I said, to fund incremental costs of overseas conflicts in Afghanistan, Iraq, and elsewhere. Most importantly, because it doesn’t provide a stable, multi-year budget horizon, this one-year approach is managerially unsound, and also unfairly dispiriting to our force. Our military personnel and their families deserve to know their future more than just one year at a time. And not just them. Our defense industry partners, too, need stability and longer-term plans – not end-of-year crises or short-term fixes – if they are to be efficient and cutting-edge as we need them to be. Last, and fundamentally, as a nation we need to base our defense budgeting on our long-term military strategy, and that’s not a one-year project.

This funding approach also reflects a narrow way of looking at our national security – one that ignores the vital contributions made by State Department, Justice Department, Treasury Department, Homeland Security Department, and disregards the enduring long-term connection between our nation’s security and many other factors: factors like scientific R&D to keep our technological edge, education of a future all-volunteer military force, and the general economic strength of our country.

Finally, I’m also concerned that how we deal with the budget is being watched by the rest of the world – by our friends and potential foes alike. It could give a misleadingly diminished picture of America’s great strength and resolve.

For all these reasons, we need a better solution than the one now being considered. Two years ago we saw members of Congress come together and reach a two-year agreement through the Murray-Ryan Bipartisan Budget Act. Although we preferred a longer-term solution to sequestration, that deal was able to provide DoD a measure of stability needed to plan for more than just one year.

Today, I hope we can come together for a longer-term, multi-year agreement that provides the budget stability we need by locking in defense and non-defense budget levels consistent with the President’s request. I pledge my personal support to this effort, as well as the support of the entire staff of the Department of Defense, and I would like to work with each of you, as well as other leaders and members of Congress, to this end.

If we’re successful, I’m confident we can build a force of the future that’s powerful enough to underwrite our strategy and to show resolve to friends and potential foes alike. A force that’s equipped with bold new technology and ideas, able to lead in cutting-edge capabilities in cyber and space. A force that’s lean and efficient throughout the enterprise; that continues to attract and inspire new generations of Americans to contribute to this great mission. That’s the vision for the force of the future I’ve been pursuing since I took office 11 weeks ago, and I hope to continue doing so, in partnership with all of you.

Mr. Chairman, this is a time for coming together and problem-solving, which we’ve come to know well from members of this committee. Much like in December 2013, our only choice is to come together to find a real solution that reflects our strength and security as a nation. I look to this committee, and the many leaders who sit on it, to help us get on the right path out of this wilderness.

Thank you.