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China Aerospace Studies Institute

Good morning everybody.  It's really a great pleasure for me to be here today.  I see a lot of familiar faces.  I have a little bit of a sore throat, so I'll be drinking water a little as I talk.  But it's really, really a great thing to be included in an impressive array of speakers that we have lined up today. 

 And so I'd like to start by commending the Air Force for standing up this important organization.  I think this institute has exactly the right focus at exactly the right time.  It supports both President Obama's rebalance to the Pacific as well as the Department of Defense's Defense Innovation Initiative, both of which are top priorities for both Secretary Carter and myself.  More generally, it's an exemplar of what we need to do to prepare for the future.

Now let's face it, in my view, we are at an extremely pivotal moment in the post-Cold War world.  The last 25 years has represented a remarkable period in our nation's history, if not the entire Westphalian era.  Throughout, the United States reigned unchallenged as the world's only world great power, and the sole military superpower. 

That was a singularly unique, beautiful moment, which as you now know, is coming to an end.  While the United States will maintain enormous absolute power as far into the future as we can see, unquestionably, our relative power will decline as we enter a more multi-colored world, and a world in which our leadership will be increasingly challenged.

Now, the most significant challenge to U.S. global leadership, and the one in my view that promises to be the most difficult to manage, primarily because we have forgotten about how to do it, is the possible reemergence of great power competitions.  Now, there are many interpretations of the term "great power," but as a national security executive, I subscribe to John Mearsheimer's definition, which is a state having sufficient military assets to put up a serious fight in a conventional war against the most powerful state in the world and which possesses a nuclear deterrent that can survive a nuclear strike against it.

By that narrow definition, if Russia and China are not great powers now, they certainly have the potential to be.  And under any circumstances, they are going to provide us with an enduring and very difficult military challenge, which will stress us.  Now, the first part, after factions in Crimea and Eastern Ukraine, its nuclear saber rattling, and its provocative and aggressively -- overtly aggressive actions from the Baltic states all the way to our airspace in our far north, Russia represents a clear and present danger.  This development is largely unexpected, coming after 25 years of working very, very hard to include Russia within the European community and cooperate with it on a wide variety of subjects and global issues.

And we still seek both of these outcomes.  However, after modernizing both its nuclear and its conventional military capabilities, and updating its warfighting doctrine, it is actively seeking to undermine NATO.  It's actively seeking to dominate the Arctic.  And it's actively trying to challenge many of America's broader global aims.

As a result of this, as you know, we're working closely with NATO to block further Russian aggression in Ukraine and to deter future Russian intimidation or military action against its neighbors and our NATO.  This will require an expenditure of resources we quite frankly were not expecting to make, and in a constrained top line that makes it even more difficult.

But let's turn our attention to China, which is the subject of this institute, and also the subject of today's conference.  It's a rising power and a growing economy and impressive weight in military technical capabilities.  And it's going to present a more significant and perhaps enduring strategic challenge to our nation over the next 25 years, if not beyond, and one the DOD has to be particularly focused on. 

This does not mean to suggest I think that we are doomed to have an overtly hostile relationship.  Indeed, our future relationship, the way we see it, will have elements of cooperation and competition and not open hostility.  Accordingly, DOD continues to pursue military-to-military cooperation, confidence-building measures with China.  In order to increase transparency on both of our sides, expand our dialog on a wide variety of security issues, to improve crisis stability, and reduce the risk of military miscalculation in the Western Pacific.

But at the same time, DOD cannot overlook the competitive aspects of our relationship, especially in the realm of military capabilities: an area which China continues to improve at a very impressive rate.  We must also be aware of historic precedents.  A Harvard study has shown that in 15 cases where a rising power interacts with the established power, 10 have ended in war.  Now, China itself is very keenly aware of this historical dynamic.  In its new military strategy, it states "international competition for the redistribution of power, rights, and interests is tending to intensify."

DOD must therefore hedge against this international competition turning more heated.  Now, for the longest time we've always felt that the best way to hedge against an overt military competition or even unexpected clashes with any large state power, is for the United States to have a strong nuclear and conventional deterrent posture. 

And this posture demands three things: first, we have to overmatch any potential competitor in the military technical realm.  Second, we have to maintain the ability to project power across transoceanic distances and defeat any competitor's attempt to project power over intra or inter-theater ranges.  And third, we have to routinely demonstrate both our technical capabilities, as well as our operational capabilities.  Now, without these three fundamental things, our conventional deterrence posture will be less effective, our overseas alliances and partnerships will be weakened, and crisis stability will be undermined.

Unquestionably, after the last 25 years, we need to spend more time thinking about strengthening each of these three pillars of our conventional deterrence posture.  Let's take it one by one.

Since the end of World War II we have relied upon our technological superiority.  Why?  To provide a conventional overmatch to overcome an adversary's advantages in time, space, and size of forces, because generally we are moving across oceans to meet them.  This was particularly true in the last 25 years, when the United States enjoyed remarkable and unparalleled conventional dominance across the spectrum.  It was truly a delight-some spot for the Department of Defense and our military services.

We could generally count on unimpeded access on the land, in the air, and in the sea.  We were probably most impeded in the aerospace domain.  But generally, we could overcome those type of defenses by virtue of our well-trained all volunteer force, and because we were first and early and aggressive mover on the guided munitions battle network regime, we enjoyed a substantial technical, operational, and tactical overmatch against all potential regional adversaries. 

Our global command and control network was without peer, deep, and largely unthreatened.  Our space assets, which underwrote our global command and control (C2) also provided us with the ability to set up theater-wide guided munitions battle networks operating in a virtual sanctuary.

Now however, all of this is changing.  And the margin of technological superiority upon which we have become so accustomed to is steadily eroding.  This is something that Secretary Carter, myself, and Frank Kendall, our Under Secretary of Defense for Acquisition, Technology, and Logistics (AT&L), have been talking about consistently.

Now, this erosion results from a combination of two factors: the first is the last 14 years, we've been rightly focused on our operations in the Middle East.  And now, our post-war budget cuts are limited in the amount of investments that we can make in both material and research and development.

Meanwhile, Russia and China are pursuing levels of advanced weapons development that we haven't seen since the mid-1980s, near the peak of Soviet Union surge in Cold War defense spending.

So addressing this particular problem in my view, as the Chief Operating Officer (COO) of the Department and the one who spends the most time trying to contemplate the character of our defense portfolio, this is one of the most important strategic tasks and risks that are facing our Department.  Because if we allow our technical superiority to erode too much, again, it will undermine our conventional deterrence.  It will greatly raise the cost -- the potential cost of any intervention overseas, and will contribute to crisis instability.

Now, to restore this, you've probably heard that we are starting a new Long-Range Research and Development Planning Program, or LRRDPP.  It's under the direction of Under Secretary of Defense Frank Kendall.  Now this follows a solution model based loosely on the LRDPP that we established in the 1970s.  And after a serious amount of work, it concluded that the combination of guided conventional munitions, informationalized battle networks, and stealth would be able to off-set the Soviets' advantage in numerical forces.

Now this next iteration of the LRDPP, in the same way aims to identify promising technologies that can be moved into development within the next five years, as well as long-range science and technology investments that we can make now and have a big payoff in 10 to 20 years.  The initial results of these efforts, this will be a continuing effort, but the initial results are going to be reported to the Secretary of Defense Carter next month.  And they will be used to provide me and the vice chairman of the Joint Chiefs of Staff strategic guidance on how to approach the strategic portfolio in the FY17 budget preparation and submission.

Now, the LRDPP is a longer-range view.  We also have the Strategic Capabilities Office (SCO), which was set up by Secretary Carter, that is looking at weapons and systems and platforms that are either in production now, or in the field now, or programmed now, and how to use them in a different way than they were intended to provide us with an unexpected operational or tactical advantage.

So the LRDPP again, a continuing program, as well as the SCO, both seek to restore a comfortable margin of technological superiority.  I want to make sure that everyone understands we are not trying to reduplicate the margin of technical superiority we enjoyed in 1995.  That would be unreasonable under any number of circumstances.  But we want to have a margin of technological superiority that provides us confidence when we employ our forces that we will have a technological advantage and be able to defeat, again, power projection, an adversary's power projection across intra or inter-theater ranges.

 Now this has long been a strong suit of our joint force, but as guided munitions and battle networking technologies have proliferated globally, fighting such away games are going to be vastly more difficult.  You hear this term all the time, A2/AD, anti-access and area denial.  They will use these weapons first to deny us access into a theater, and then if we are successful in getting into a theater, will use these things to deny us freedom of maneuver and action in all domains once there.

All of our global command and control and space capabilities are under increasing threat.  And in an unclassified environment, I can't speak too deeply about this, but let me just say that it is very concerning.  Our potential adversaries are pursuing a wide range of cyber and kinetic attack capabilities, and we are going to have to expend a lot of effort to maintain our C2 network and our space capabilities in any future fight.

And that is why we are exploring offset strategies: new combinations of technologies, operational concepts, organizational constructs that will maintain our ability to project combat power into a theater in a place and time of our own choosing.

Such new strategies will require us to leverage commercial innovation, which quite frankly is leading -- is in the leading edge of the types of technologies that we need to consider, and to greatly accelerate the refresh cycle of our new weapons and systems.  This is a much more competitive world than we had in the 1970s, and that is moving much faster.  And we have a wider range of potential competitors.  And we have a wider range of commercial technologies that can be used in interesting ways that will surprise us.

 In fact, the next 25 years, one of the things we must be prepared for is technological surprise.  Now, the Air Force's Rapid Capabilities Office, or RCO, is a good organizational example of the type of innovation and speed to market that we need to sustain and advance our military superiority.  It has a streamlined chain of command.  It focuses on stable requirements and funding stability and early and prominent involvement of warfighters.  And the combination of all of these things truly reduces cycle times.  It demonstrates the magic that occurs when we marry up the operational and acquisition personnel and turn them on to a problem and tell them to solve it quickly.

That's why I'm encouraging all of the other services to set up their own RCO-type organizations.  Hopefully, we'll be able to convince the Navy to stand up theirs soon, and then the Army soon thereafter.

Now regardless of the offset strategy that ultimately we elect to pursue, one thing is absolutely certain.  It's going to invest heavily and rely heavily on strong aerospace capabilities. All of our previous offset strategies have done so, and there's no reason to think that the future will be any different.  Aerospace power has always been and will always be fundamental to our ability to project power across trans-oceanic distances, to conduct theater entry operations, and to mount joint combined arms operations.  And because of its rapid global mobility, air power will likely be the first on the scene in any unexpected crisis in the future.

Now for all of these reasons, as I take a look at the defense portfolio, the thing that bothers me the most is that in 2001, the United States Air Force had 88 tactical fighter squadrons.  Today, and primarily due to intense budget pressures, they have 54, and we are moving to 49.

If you compare that with our ground forces, before and after the war and the program we have now, and we will have approximately a million men and women in our ground forces, plus or minus.  The Navy had 316 ships in 2001, and under the current program, it will have about 306.  So if you just take a look at the defense portfolio, comparing forces before and after the war, not at the wartime surge, but before and after the war, we're about the same place where we are in ground forces.  We're about the same place we are in naval forces.  But in aerospace capacity and capability, we have dropped significantly.

And the demand for the Air Force and the aerospace capabilities hasn't gone down, as you all know.  Endless deployments have caused a readiness challenge in the U.S. Air Force in trying to get back to full spectrum combat readiness.  Still, under the most optimistic budget scenario, which is the president's budget's level, the Air Force will not get back to full spectrum capability or readiness capability until 2023.

So we need to be seriously thinking about how we reconstitute aerospace capabilities in an era of tight budgets and increasing strategic threats.  Now part of the answer of course is to keep the new generation of things going.  The F-35 Lightning II Joint Strike Fighter, the new Long Range Bomber, and our new tanker capability, as well as other Intelligence, Surveillance and Reconnaissance (ISR) improvements that we are pursuing.

But part of the answer is to start thinking about their replacements right now.  That is why one of the LRRDPP lines of effort is looking at the next generation of air dominance and exploring ways to regenerate aerospace mass affordably using combinations of both manned and unmanned systems.  It is complemented by our new Aerospace Innovation Initiative (AII), which will develop prototypes for sixth generation air systems.  This initiative will help us preserve our high-performance aeronautical design teams, and hopefully help us reduce lead times in the future from our next generation of capability. 

But I want to emphasize this, because I'm accused of this all the time.  Preserving our aerospace dominance and preserving our overall military dominance is not all about technology.  It's more about thinking about the future, looking at the challenges that we might face, conceiving of the right technological approaches with innovative operational concepts and flat, agile organizational constructs that play to our strengths, exploit enemy weaknesses, and preserve our own advantage.

And that is where CASI comes in.  Without question, China is mounting a serious aerospace challenge against the United States.  They are intent on closing the gap between their aerospace forces and our own, and they're also trying to build an aerospace R&D design and industrial capacity that is equal to ours.  As a result, they are quickly closing the technological gaps in a wide variety of areas.  As you know, they are developing various stealth aircraft, a wide variety of ISR and battle management platforms, advanced air to air and air to surface missiles, and top of the line electronic warfare equipment.

They already have and are improving one of the world's densest and most capable air defense networks.  The PLA Second Artillery Corps, both some of the finest missileers and missiles on the planet, and they are pursuing a range of counter-space capabilities while at the same time improving their own space capabilities because they are obviously thinking that they will have to fight to maintain space superiority in the future.

Now at the same time, the subject of this conference today is they are moving to do more realistic training across the board under what they call actual combat or wartime conditions.  They are also trying to improve their readiness.

So CASI needs to help us think on how we respond to this challenge.  It's a serious one, and one that we have to take seriously.

So the first order of business is help us figure out how we operate in an age of guided munitions parity.  Now, the Air Force, of all of the services, should have the big advantage in trying to help us think this through, because they've been thinking about this since Vietnam.  And as I mentioned earlier, we dominated the guided munitions warfare regime for the past 25 years.  There's no question about it: we have.

But now big state powers like China and Russia are rapidly catching up.  So this is going to require a fundamental rethinking of the way the joint force operates, and I believe an organization like CASI can be one of the leading voices in helping us understand this.

So the first component of any offset strategy, it's going to be a one-two punch.  The first thing on any offset strategy is to have a demonstrated capability to win the emerging guided munitions salvo competition.  That is job number one.  This demonstrated ability to win this competition will underwrite our conventional deterrence in the 21st century.  And if we don't have it, we are going to be faced with a lot of problems that we do not want to face.

And this is much easier said than done.  We're on the wrong end of the cost equation in this competition right now.  We have been for some time.  Using multi-billion -- excuse me, million dollar missiles…millions just don't mean too much to me anymore.  To defend surface ships and fixed bases against relatively cheap ballistic and cruise missiles.  So we need to identify raid-breaking technologies.  If we had assault-breaker in the early 1970s, now we need to have raid-breaker.  And that is looking at lower-cost counters to enemy salvos, to include non-kinetic list of launch approaches, as well as kinetic capabilities with lower cost per shot, such as directed energy weapons, electromagnetic rail guns, or hyper -- hyper velocity projectiles (HVP) fired from powder guns.

Now, if these capabilities allow us to confidently dominate the salvo competition, then our ability to break into a theater will remain assured and conventional deterrence will be strengthened.  But we can't stop there.  Again, the offset strategy, just being able to win that competition is just kind of the cost for entering.  But once we get there, we have to figure out how to do joint combined arms campaigns on battlefields swept by guided munitions or precision artillery or however you want to call it.

In other words, we have to think about the nature and character of AirLand battle 2.0: another thing where CASI, I believe, will be central to our thinking.  Now, we're not entirely sure what our concepts for air dominance in the future or AirLand battle 2.0 will be at this point in time.  But the LRDPP's initial findings suggest, and I don't think this will be a surprise to anyone who follows aerospace capabilities, you're going to have ubiquitous standalone intelligence systems.  Perhaps they'll be the first line of our cyber defense. 

In a strategic cyber attack, having men in the loop at that point, we will lose the initial salvo.  Machines will have to blunt that attack and move to counter it, essentially in micro-seconds.  You'll also have a high degree of human-machine collaboration, like free-style chess, in which machines, using big data analytics and advanced computing, will inform human decision makers on the battlefield to make better decisions than humans can do alone or machines can do alone.

You're going to have routine manned and unmanned teaming.  You're going to have increasingly capable autonomous unmanned systems.  You are going to have all of this.  So the future of combat, we believe, is going to be characterized by a very high degree of human-machine symbiosis, such as crude platforms controlling swarms of unmanned, inexpensive unmanned systems that can be flexibly combined and fielded in greater numbers.

And again, we're perhaps closer to this vision in the aerospace domain than any other domain, because of the advantages in communications that we have and the advantages in mobility that we have.  One of the hardest things to do is create an unmanned ground system.  Just moving over rocky terrain is an extremely difficult problem.

Now, you are all familiar with the close manned and unmanned teaming we have in our global campaign against terrorism.  This was kind of the leading edge of this type of thinking.  Just last week, I was out at the Naval Post Graduate School and saw the impressive work being done at the Advanced Robotic Systems Engineering Laboratory, or ARSENL.  They flew a swarm of autonomous, 20 autonomous unmanned aerial vehicles (UAVs).  It was a leader-follower swarm, but it set the world record: 20 operating together.  They're now working on demonstrating a 50 UAV swarm, and then they'll move to a 50v50 swarm fight.  Meanwhile, just last week, during Exercise Northern Edge in Alaska, the SCO demonstrated innovative tactical uses of large numbers of micro UAVs. 

Now fully understanding the all-important human dimension of this form of warfare will demand that organizations like CASI, talking with the operators, backed up by our entire professional military education system, help us develop the human capital which undermines this type of combat.

And I would say that this is an enduring advantage for a democratic state.  We look for people, we encourage innovation, we encourage initiative.  This is not something that authoritarian states automatically do or seek.  If we get this right, this will be an enduring advantage for us for the next several decades.  So, we have to continue to prepare our people not only to be comfortable with working in this giant just soup of manned and unmanned systems, but we have to prepare them for uncertainty and friction and encourage them in creativity at all levels, tactical through strategic.

When uncertainty increases, we must provide them with the tools to think through these problems, with an approach to professional military education that is worthy of these challenging times.  Nobody does this better than the U.S. military, and I have great hopes that CASI will be able to help us in the future.

So in closing, let me congratulate the U.S. Air Force for standing up CASI.  I think the Air Force, with its Rapid Capabilities Office and CASI are kind of showing us a way to go forward.  It reflects the Air Force's commitment to better understanding the future challenges we face and how to counter them.  I hope that CASI, along with many organizations like it, are going to help us maintain an unfair competitive aerospace advantage far into the future, because that is the surest means to underwrite conventional deterrence, contribute to crisis stability, and safeguard our nation's interests.

Thank you, and I look forward to your questions.