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Department of Defense Press Briefing on the State of the Air Force

SECRETARY OF THE AIR FORCE DEBORAH JAMES: Thanks to all of you for joining us and spending some time this afternoon.

I have now been on the job as the 23rd secretary of the Air Force for about seven months, and during that seven month period, I have divided my time. Obviously, some of it here in Washington, focused on working with Congress, working on budget matters, a variety of policy issues, and the other part of my time, I have focused on getting out and around and seeing our Air Force in action.

And I have seen all of our five core missions at work now, including at 39 different bases across the United States in 22 of our states, and I've been overseas now twice, to include Afghanistan, Kuwait, the United Arab Emirates, Qatar, the United Kingdom, and Germany.

Now, when I took over as secretary of the Air Force, I did establish right from the beginning three priorities. They're critical for all of us as we go forward to accomplish all of our missions. And these three priorities, just as a reminder, are taking care of people, number two, striking the right balance between the readiness of today and providing for our readiness and modernization tomorrow, and number three -- very importantly, in this very tight budget environment -- we need to make sure that we make every dollar count. Because the taxpayer dollar is precious, and we have to spend all of those dollars wisely.

So, today, what I'd like to do -- I'd like to give you sort of my take -- my update on how I think we're doing against all three of these priorities.

So, beginning with taking care of people -- obviously, critically important. And there are many, many elements to the people's story in the Air Force. But I will tell you, my take, after seven months, is, we are very blessed in the Air Force, because we have really, really impressive airmen. They are smart, they are dedicated, they are motivated. They're really pumped is the way I would put it.

We have been very, very fortunate to have -- and continue to have -- solid recruiting and retention. And for the most part across our Air Force, morale is high. So, all of that is very, very good news.

But I will tell you this. I do feel that our airmen are feeling some strains. And the biggest reason for this -- the biggest issue on the minds of our airmen -- and I know this because I do all calls everywhere I go -- is the uncertainty that they are facing because of the downsizing and the uncertainties of budgets, and where are we going with our Air Force.

So, now, General Welsh, when I yield to him in a few minutes, is going to give you an update on that downsizing and on our force management processes. But one thing I would just say for now -- and I know we -- I speak for both of us -- our mutual desire is to get where we need to go as quickly as we can, to get it over with as quickly as we can, and then to move on to the future of our Air Force.

Now, beyond that, there's two special topics that I'd like to just pick out. Many topics in personnel, but there's two others that I'd like to touch upon. And the first one is sexual assault -- very, very important topic. And everywhere I go, each and every installation, I always ask -- and I have, in fact, met privately with our Sexual Assault Response Coordinators -- again, around the country and around the world. I do meet with them in private. I ask them to give me the utmost candor. And the bottom-line question that I'm always looking for is, do you think we're on the right path? Are we making progress in stamping out this crime?

And my take on this, after seven months in all of my discussions, plus my discussions with other leaders -- General Grosso, and so forth -- is that we are making good progress. Our reporting is up. Our -- we had increased reports in F.Y. '13, and also the preliminary reports for F.Y. '14 are up. And I think that's good news, because that means, to me at least -- I believe it means that our victims are feeling more confident. They're feeling more comfortable in coming forward and explaining what has happened to them.

Now, we don't yet have our prevalence data. That will be coming later in the year, so we don't yet know the progress that we have made or not made when it comes to prevalence, but we will know later this year.

I'm also hearing from the field that they believe that the commanders are on top of this, that they are taking it seriously -- this is a serious matter across our Air Force, and it is viewed as such.

I'm hearing that our training has been improved. I've gone through some of the training myself. I thought it was terrific training. So, the training has been improved over the last year or two. And we're also constantly looking at the care that we give to victims. To tweak it this way or tweak it that way, to try to make it the absolute most supportive that we can.

And as I think you all know, we have as a general proposition rededicated ourselves over the last few months to what we call our core values, which is important across all parts of the Air Force. And the core values, of course, are integrity, service before self, and excellence.

So, all of these things to me add up to what I say we are making progress in this front. But progress is, of course, not good enough. What we have to do is, we have to keep on it. And so, it means persistent focus, persistent leadership, and persistent action for pretty much forever. That's what we just have to keep on. And the chief and I are fully committed to doing just that.

The second topic on personnel is our total force, which, of course, to us means our active duty, our National Guard, our reserve, and our civilian workforce. And everywhere I have been, I have seen a terrific total force team in action.

Now, when it comes to the active duty, the Guard and reserve, you're probably aware that we have made the commitment over the next several months really through the end of this calendar year. We are going to be assessing on a mission by mission basis our force to see what additional capability might we put in the future into the Guard and Reserve, and we believe we'll have 80 percent of that -- of our entire force looked at between now and the end of the year.

So, of course we don't know how that will turn out, but I would expect that out of that, we will come up with additional missions, additional capabilities, that we would ask our Guard and Reserve to assume in the future, and so I see the future of our people program to be more reliant, not less reliant, on our National Guard and Reserve.

All right. Shifting now to the balance between readiness of today and our modernization, meaning our readiness of tomorrow. Coming off of 13 years of war and most recently, coming off of sequestration, I will say in my opinion we are not where we need to be or want to be in the Air Force when it comes to our full spectrum of readiness.

And certainly, if you look back over the last month or two, it has been an extremely volatile world, which makes me concentrate even more on our readiness. So I'm talking about the Ukraine and Russia, and we're talking about the situation in Iraq with ISIL, and then there's Libya. And you could go on and on. It's a volatile world, and readiness is key, because at any time we could be asked to step up to the plate and conduct some dangerous missions.

And so that's precisely why we chose to pump more money into our F.Y. '15 budget proposal to get those readiness levels up in our Air Force, full spectrum readiness. So, this includes investment in training and range infrastructure, and munitions, and maintenance. All of these things play into readiness.

Now, as you know, tight budgets, we had to figure out how to pay for this sort of an initiative, and among other things, we did suggest retiring some older aircraft to pay for this priority as well as tomorrow's modernization, and it has been difficult to get some of these proposals approved through the Congress. It's not done yet, but it's been a difficult road. It also appears, at least as it stands now, that we will not be provided with the authority to do another round of base closures.

So, basically the message that General Welsh and I keep taking to Congress at every stage that we can is -- obviously is Congress's constitutional prerogative to rearrange priorities, but in so doing, please do not carve money out of our readiness accounts, as these priorities need to be paid for, because readiness is key, and we need to get those levels up. And by the way, please Congress, lift sequestration in F.Y. '16. Because if these difficult choices in F.Y. '15 were troublesome, hold on to your hats, because it's going to get worse and even more difficult in F.Y. '16. So, this is a message that I wanted to repeat today. I think it's very important. We need to get full spectrum readiness up.

And now that I talked about today's readiness, let me shift to the future, tomorrow's readiness. What's our Air Force going to look like 10, 20, 30 years from now? Well, I also told you, I already told you, I think we'll have greater reliance on our Guard and Reserve, because obviously you know our numbers have been coming down. We're going to leverage the Guard and Reserve more, I would predict. But we have to maintain that technological edge. We have to be -- remain ready, with top notch people, as we have today. And we need to become more agile, more quick, at everything that we do.

So, what does all that mean? Well, it means a lot of things. So, for one thing we need to keep working diligently on our top three programs, the new fighter, the new tanker, the new bomber, and General Welsh is going to give you some updates on those three in a few moments. There's other technical investments as well.

We're going to need to invest more, in my opinion, in space and cyber as we go forward. And you guys have heard me say it again, say it before, and I'll say it again. We also need to continue and invest more in the number one mission, which is the nuclear enterprise in the Air Force. Obviously, we need to keep the focus on readiness and people going forward.

Now, all of this is tricky business because we're back to that story of the budget, which is likely to remain flat, I think, if we're lucky. It could be going down if it's sequestration. Which brings me to that third priority, and that is make every dollar count.

I'm certainly focused, as is General Welsh, on getting the absolute best value for the taxpayer, the most capability at the least cost. And so to help us achieve this goal, we have to do a number of things. We have to keep our programs on track and delivering and on schedule and not over-running to the very best of our ability. We have to build affordability, right from the beginning, into our new programs, whenever we have the opportunity to do so. And by the way, that's what we did with the long range strike bomber, that's what we did with the combat rescue helicopter. We need to keep that up.

We have to attack headquarters spending. And you all saw we just announced that we're going to reduce 20 percent in one year, not five, so we're aggressively going after that. We're aggressively going to go after contract spending as well: spending on contractors. This has already been happening, and we want to take a fresh look at that and see if we can do better. And then we're bubbling up ideas from the field. We've invited our airmen to come in and give us ideas of what they see from their work environment of ways that we can do things differently, save money, save time. And that's our make every dollar count campaign, and we've gotten thousands of ideas from our airmen. As you can imagine, not every idea is implementable, but we're reviewing the ideas, and we're implementing some, and we're projecting about $76 million in savings from the ideas that we've already approved. But this is our way of getting everybody involved with making every dollar count.

Now, before I wrap and yield to General Welsh, just a few more words about the Air Force of the future. Today, we are rolling out a new strategic framework, and we're calling it "A Call to the Future," which represents a roadmap to help guide our long-range planning efforts, and we'll also help us, this is very important, make smart money and policy choices going forward. It's very important you not only have a strategy, but then you need to follow through with the money choices and the policy choices.

Now, as I was going through my confirmation process on Capitol Hill, and I would do my courtesy calls with senators, I frequently heard that they felt that the Air Force seemed to lack consistency in our policy choices, our resource choices. One year we would say this, another year, we would say that. That was the perception that I heard on Capitol Hill. Well, this kind of a framework, if we follow through with it, should certainly help us attain better results in that consistency department.

Now, the document is a third in what you might call a trilogy. The first, our vision document, kinda tells who we are. It's a lot about our airmen. The second one, "Global Vigilance, Global Power, Global Reach," this is a document that talks about our five core missions. It tells the what we do story. And the third one, the one that we're rolling out today, talks about where are we going. So, we've got the who, the what, and the where.

And as you go through it, you'll see it's not a warfighting document, it's not a new national security strategy, it doesn't replace current doctrine, it's not any of those things, but rather what it is, it's a framework which is intended to help guide us in our Title X responsibilities for our Air Force, which is organizing and training and equipping, going forward.

So, the basic premise is that we never ever seem to accurately predict the future. We never get it right. And so therefore we're going to have to continue to be able to step up to the plate and do a range of missions and also that we need to get ahead of the curve when it comes to the enormous and very rapid change that we're seeing in our world. And I'm talking about changes in technology, changes in different nations and groups acquiring weapons, changes in how we communicate with one another. Who ever saw Facebook and Twitter 10 years ago? These are all enormous changes in a short period of time. Geopolitical instability changes as well.

So, these are the hallmarks of the strategic environment that we're going to face, and so therefore, instead of focusing on a specific threat, we're trying to focus and recognize this quick pace of change, and we have to recognize in ourselves the imperative that we be able to change more quickly as well.

Strategic agility is what we're shooting for. So, this phrase, "strategic agility," should allow us to rapidly adjust to evolving threat environments faster than our potential adversaries, and help us counter some of this great uncertainty.

Now, this whole concept is going to take time, obviously, to instill into a big institution like the Air Force, because I don't know that we're known for being, you know, enormously agile at the moment. But you have to start somewhere, and so this is where we're going to get started. And by the way, we just reorganized our headquarters Air Force staff in order to take these -- these points, and ultimately over time, make those resource decisions and policy decisions to make this strategy real.

So, as we move forward, I would predict that you will see us embed this concept of strategic agility into a lot of key areas that we're going to be working on. So, when it comes to people and training, which is a Title X responsibility, you'll see us embed into policies and decisions and whatnot, the concepts of more empowerment for our Air Force airmen, our members; more continuum of service, the flow between active, guard and reserve and back in a more seamless way; more live virtual constructive training so that we can train in different ways than we train today; diversity of thought, critical thinking skills for airmen.

These are all the things that you can expect to see us work on when it comes to people and training.

In acquisitions, design agility into our requirements across processes to build in more frequent pivot points, which will mean opportunities to modify or abandon pieces or technologies within programs and be able to harness rapid prototyping to bring a design idea into service more quickly.

You're going to see us continue to elevate affordability in new programs, as well as exportability. Think through in the beginning. We want allies. We want interoperability. What types of things could we export and build in those requirements from the get-go?

When it comes to investments, I think you can continue to see us talk about some that you are aware of, but maybe some less so. We have got to invest more in our nuclear deterrence. I've said that repeatedly. We've started and we're going to continue on that. ISR will continue to be extremely important and we will continue to invest.

Stand-off and long-range weapons. I already mentioned the importance of space and cyberspace. And then there are key technologies which could be game-changers. We don't know yet, but they could be -- things like hypersonics, directed energy, to name just a few.

And the last point I will give you about this strategic framework is we talk about a multi-domain approach. And so this is the idea that we have really three domains that we operate in. We operate in the air. We operate in space. And we operate in cyberspace.

And for any new challenge that we might encounter, it maybe is not the correct answer that it requires a new plane or a new munition to go on a new plane. Maybe there are ways to leverage space. Maybe there are ways to leverage cyber in order to address that problem. We don't know, but we have to open up our minds much, much more to what we're calling the multi-domain approach.

So as I conclude, the bottom line that I would give you -- my bottom line after my first seven months on the job, our Air Force is in good shape today, but we're feeling some strains. The future depends I think in large part on how well we plan and execute some of the things that we've talked about today and how well we do that consistently over the years.

And we certainly hope and we expect and we will continue to work with Congress to help us in this regard, to support us in this regard. Very importantly, we are going to continue to talk about lifting sequestration and protecting readiness. And again, I want to thank you for your time today that you're spending with us.

And let me yield now to General Welsh.


Good afternoon, everybody, and thanks for taking the time to be here.

It's a fascinating time to be in the U.S. military and it is always a great time to be an American airman. Our Air Force supports military operations all over the world, all day, every day, whether it's ongoing operations in Afghanistan, counterterrorism activities in Africa, training with and assuring friends during exercises in eastern Europe, sitting nuclear alert in the American Midwest, conducting ISR partnership building and missile defense in the Pacific, standing the watch in Korea, or sitting here defense alert here at home.

Our job is to provide combatant commanders with air power options to handle any contingency they may face. And like you guys, we're pretty good at our job.

In order to continue doing all of this, we have a responsibility to our airmen to maintain the balance between being ready to do the job today and being able to do it 10 years from now. That's not an easy task in the best of financial times, but these days under sequestration it's getting increasingly difficult.

So we prioritized three acquisition programs this past year: the F-35, the KC-46, and the long-range strike bomber because we believe they are operational imperatives for the joint force of 2025 and beyond. If we expect to remain the world's leading air power nation, a distinction that gives us an undeniable asymmetric advantage today, we must recapitalize our aging legacy fleet.

So, let me start with that fighter fleet. The F-35 is the answer, the only answer that will ensure future air campaigns are not a fair fight. And there's good news to report on this program. We're reaching important F-35 milestones. Eglin Air Force Base just took delivery of the 26 F-35A in May, so the 58th Fighter Squadron at Eglin now has its full complement of aircraft.

That's a major milestone on the flight path to initial operational capability for the Air Force in late 2016. Aircraft production costs are tracking down now well-understood, predictable price curves and both test and training programs are moving forward steadily. The recent engine fire has gotten a lot of attention. It slowed our flight activity as we worked both aircraft and engine manufacturers to completely understand the root cause.

We've implemented a restricted flight envelope which you've read about which will remain in effect until we understand that root cause completely, we've identified it and we've corrected it. I do think it's important to remember, though, that engine fires happen when you fly a high-performance aircraft. This isn't the first aircraft that's had one and it won't be the last.

I also think it's important to keep this particular fire in context. The F-35 has now flown about 8,700 sorties and over 14,000 flight hours. This is the first time we've had a major engine fire. We inspected every other engine in our fleet and we didn't find any with the same level of wear and tear in the area that failed in the mishap engine. I'm confident that the program will remain on track and that we'll reach IOC by December 2016. This fire is not going to affect that.

Our Air Force refueling fleet is the lifeblood of U.S. military global response capability. It's also older than almost everyone in this room. The KC-46 Pegasus is another top operational imperative for the joint force. The 179 aircraft we will fill between 2016 and 2028 will bring more refueling capacity, improved efficiency, increased cargo and air medical evacuation capability to both our Air Force and to the joint warfighting team.

The first test aircraft is schedule to fly this fall. Boeing continues to live up to the terms they committed to. They've met every contractual requirement to date. Those of you who follow the program saw Boeing's recent announcement of a change -- excuse me -- a charge against the program to correct a deficiency in the wiring system. The contractor will cover those costs. There is no additional cost to the government.

We remain on track for all major program milestones and we will continue to work very closely with the company to bring this great new airplane online. Global reach is fundamental to our warfighting success in the United States of America and Pegasus will make it reality for the next 40 years.

The long-range strike bomber is the third of our major must-have programs. It will give our country the ability to hold any target on earth at risk. It also gives us the ability to conduct extended air campaigns and provides operational flexibility across a wide range of military operations. LRSB will be a long-range, air-refuelable, highly survivable aircraft with significant nuclear and conventional standoff and direct attack weapons payloads.

We plan to field 80 to 100 of them with initial operational capability in the mid-2020s. It will be an adaptable and highly capable system based upon mature technology. As I think you know, we've established an achievable and stable set of requirements with a realistic target cost for this airplane. We recently released a request for proposals and we expect a pretty robust competition. Contract award is expected in spring of next year.

And while these acquisition programs are critical to our success in the coming years, there's nothing more critical to our success than the airmen who power this great Air Force. This is a tough time for some of those airmen. We're asking great men and women who've done everything their nation asked of them in some pretty tough places to involuntarily leave our Air Force. There is nothing good or easy about this.

Both Secretary James and I have a responsibility to balance our force to a size that we can afford to train and operate. And we need to do it before we return to sequester levels of funding in F.Y. '16 if the existing law continues to take us there. We submitted an F.Y. '15 budget that reduces the number of active duty airmen from 330,000 this year to just 307,000 within five years.

Our force management actions that have been held during the course of this year have already approved about 13,400 airmen for voluntary separation and over 6,000 for involuntary separation. These airmen will leave our Air Force by the spring of next year.

Air Force budget proposals are still being debated by the Congress. And so we're not sure whether or not we'll be allowed to divest force structure next year. Those force structure decisions have personnel implications. So our final decisions can't be made until those final decisions are made by the Congress. So it's difficult to tell exactly where we will end up in the short term.

But as we promised our airmen, we have done and are doing everything we can to maximize voluntary separation programs prior to implementing involuntary measures, but that won't make it any easier for those chosen under the involuntary process. We will do everything in our power to ease the transition back into civilian life for those airmen and their families and we thank them for their service.

I'd like to finish by saying that our airmen will meet the challenges we face head-on and they'll overcome them. They're really magic. They will continue to be the best in the world at what they do and they inspire Secretary James and I every day to try and do the same.

Thanks again for being here and we'd love to take your questions.

Q: Thank you. Question for either of you about the strategic framework document you're publishing today.

In the section where it discusses deterrence, it says that the nuclear weapons infrastructure must be recapitalized where necessary, and should be modernized when needed. And that just strikes me as a sort of a non-committal statement. I'm wondering whether you actually feel it's necessary and needed, and how will you afford it?

SEC. JAMES: So, I'll start, and then maybe, Chief, you jump in. But I think we do need to modernize it. It's a question of when. And we are doing (inaudible) of that ourselves within the Air Force Budget. Of course, we're, you know, going through the next POM cycle -- the beginnings of it.

We're also in discussions with OSD. Both the secretary, the deputy secretary -- they're extremely interested in this area, as well. And a point that I continue to make -- and I believe there's agreement on this point -- that this is a national asset. So, it's not just an Air Force issue per se, it's a national asset. And, therefore, it's an issue for all of it -- for all of us. And so, I think, as you see, when we work through this process -- obviously, we'll have more to share in the months to come -- but I would suspect, you are going to see more money put into modernization.

Q: And a follow-up? When you mention it's a "national mission," are you saying that the Air Force should have a bigger piece of the pie -- the budget pie, as a result of that?

SEC. JAMES: So, what -- what we're doing, of course, is, we're trying to explain the total picture of our Air Force and some of the strains that I talked to you about. So, this will all get figured out in the next several months. But we do feel that additional monies could well be in order, because this is such an important national asset.

GEN. WELSH: Ma'am, if I could add -- about the -- the document that we're releasing today is part A, if you will, of three documents that will form our overall Air Force Strategy. This is the call to the future piece, the one that keeps us moving forward, that pulls us in a -- a direction of those principles, that conduct, that behavior that we think we have to have to be successful as an institution.

The next piece is the Air Force Master Plan. So, we will take the 12 existing core function master plans, consolidate them into a single master plan. That master plan should have the detail you're looking for. And their work will be driven by the words you just read, that say if we're going to have this as a mission, we need to make sure the infrastructure is capable of doing the job, and supports the airmen who are conducting the mission. That should show up in the Master Plan.

The third piece of this is a 10-year balanced budget that we will renew every year so that we can actually over time create consistency across mission areas from a call to the future that we update every four years, a -- a master plan that is resource-bound at a 20-year rate, 'cause we spend things for 20 years. And then a 10-year balanced budget. And each year, we hope that will provide consistency in message, consistency in funding, and over time, build trust with the people we have to have trust with to get consistent, dependable investment in those programs that have to be maintained, upgraded, recapitalized, like our nuclear infrastructure.

Does that make sense?

Q: Thank you.

GEN. WELSH: Yes, sir.

Yes, sir?

Q: Yeah, hi, sir. James Drew, Inside the Air Force

You -- you're wanting to start the nuclear enterprise at 100 percent, and -- and pump a lot more money into it. How do you -- how do you say to one section of your force that you can be staffed at 100 percent, whereas those same staffing requirements are needed probably across the enterprise?

GEN. WELSH: Mm-hmm.

SEC. JAMES: So -- so, my answer to that is, we can't do everything. And, therefore, we have to have some clear priorities. And nuclear is number one. And people need to understand that. And so, that is precisely why we're shifting resources and we're shifting personnel. The personnel aren't all there on station yet, but they'll be coming. And there are eight what we consider critical specialties within the career field, and they have got to be staffed at 100 percent. So, that -- that is the decision.

I will tell you also, in our Air Force, we staff at 100 percent level our overseas forces. So, that's also very critical, because, again, they're tip of the spear, and the nuclear is considered tip of the spear, as well.

GEN. WELSH: Part of this also has to be a very hard look in the mirror at how we do business -- and every mission area, to include the nuclear business. Because if the requirement for people can be reduced by getting smarter about how we do the job without putting the mission or safety or security at risk, we can actually free up resources to use in other places again. That's a part of this process that's ongoing now.

Q: And could I just follow up with that?

GEN. WELSH: Mm-hmm.

Q: Just on the actual technology side -- you mentioned hypersonics. And I know you've had a briefing on this recently. How important will that technology be in feeding into a possible replacement for the minuteman?

GEN. WELSH: Hypersonic the kind of the big picture for me is speed compresses kill chains. Real speed really compresses kill chains and reduces the enemy's decision time. For our warfighting force, that's an important concept. Anything we can do to speed up the effects we want to create is a good thing, whatever domain we operate in. I don't think hypersonics in the near term will impact the ICBM modernization that we're looking at. My personal opinion.

SEC. JAMES: Yeah, and I was going to simply say, I think it's too early to tell.


Q: Thank you very much.

I'd like to ask you about propulsion, so please bear with me as I get to the question. As a result of the situation in Russia, there has been sort of a systemwide reaction to some of the decisions that were made that led us to the RD-180 situation now. Some people in the national security framework say, you know, we should have implemented some of the contingencies that were on the table.

Now, however, you've got an F-35 situation with one engine and this far into development, where we're told we're doing very well in flight testing, we're halfway through development on flight testing, you've got a fleet grounded. So, how do you reconcile the lesson from RD-180, which granted, was not performance, it's supply, with the challenges that could be faced with having one engine for an entire allied Air Force?

SEC. JAMES: Take a first cut at that.

GEN. WELSH: Would you say your last sentence again?

Q: Probably not verbatim, but yes. So, how do you rectify the lessons from the RD-180 experience, which realizes that's not a performance issue, it's a supply issue, but essentially, you could be cut off, with the situation you now face with F-35, which whether it's a performance issue or a supply issue, right now you're facing a performance issue: the entire fleet's grounded. You're going to have 10, 11 Allied nations relying on this propulsion system. Is there a lesson from RD-180 that should be put on F-35.

SEC. JAMES: So, OK, I think I understand a little bit better, so maybe I'll take the first cut.


SEC. JAMES: If that's all right.

GEN. WELSH: Have at it boss.


SEC. JAMES: OK. So -- so first of all, maybe just big picture. Bear with me while I hopefully get to the -- answer your question, but sort of the big picture on Russia.

Obviously, you know, we, the United States, we are standing firm with NATO. We're working with our allies. I was just over there in the U.K., so this was extremely important topic that I talked with a number of people about, so people are monitoring the situation with Russia, receiving -- it's receiving attention at the highest levels. There's diplomatic overtures and sanctions, and you're all aware of that.

I think everybody is aware that we have proposed, as part of the European -- what we call the European Reassurance Initiative, additional monies for additional rotational forces, exercises, and different, I'll say engagement activities so that our presence, the presence of our NATO allies, is very much felt there. So, all of that is going forward.

Now, with respect to the RD-180, as you said, at the moment, we're heavily reliant on it for our space launch program, and our desire is to get off of that reliance, as soon as we can. Right now there has been no interruption in the supply, despite tweets to the contrary at one point. And we do have a two year stockpile. So, what we're doing is we're working through our options on how we will get off of that reliance, and we've got, you know, near term and long term things that -- that we're looking at, depending on how world conditions go.

So, for example, you know, speeding up the purchase of the Delta. So, that is an American-produced engine. It happens to be more expensive, but that certainly is an option for us. We're working to get the -- the new entrants. One new entrant at the moment is getting close, and we're working diligently, putting our resources, our money, our people against that certification process. So, that's coming along.

And we're trying to figure out how we would do a new -- a new engine. So, you know, could it be a public-private partnership, is it a full up government program? We're working through all of that, and would expect to have, you know, more to say on that in the -- in the coming months.

Now, with respect to the engine in the F-35, the entire fleet is -- is not grounded. The fleet is flying again. It's got limitations. I think we expect those limitations will gradually be eased up. It's not unusual in a development program to have something like this happen. It's happened before. I think we're all very optimistic that we will be working through it, and so I do not see, and the chief said the same thing I believe, that this is in any way a show-stopper. It's -- it was unfortunate that it happened, but they're going through and trying to narrow down the root cause, and we will work through it.

So, that would be the way I -- I don't see the two as particularly similar, and I think we're going to work through both. It's just going to take us a little bit longer.

GEN. WELSH: Yeah, I think it would be a little alarmist to assume we have a problem with the F-35 engine. Pratt & Whitney's been making pretty darn good engines for single engine airplanes for a long time for the United States Air Force. I've got a lot of time myself using them and flying in airplanes that have them. And I think what we found in the program so far with these, you know, almost 9,000 sorties now is this engine works pretty well, too. That day, it didn't, and we have to figure out why.

Q: And if I may ask a follow up, do you feel that the decision to get rid of the F-136 was premature? Would you like to have an alternative engine if you could?

GEN. WELSH: I would like to have 1,763 F-35s with an engine that works really well every single day. That's the goal.

Let's go in the back.

Q: Thank you.


So, looking at this document, there's about a paragraph dedicated to unmanned systems. Spending on unmanned systems was out in the most recent budget, but what's odd is that spending on armed drones around the world is actually up. There's very few countries right now that have them, but according to RAND, there's 23 countries that currently have a program in developing armed drones.

So, in thinking about the Air Force of the year 2025 and beyond, how do you respond to criticism from like Michael Horowitz and other scholars who say the U.S. is over investing on very expensive manned systems while the rest of the world is getting more bang for their buck out of next generation, more autonomous, more lethal, unmanned systems?

GEN. WELSH: I'll give you a personal opinion on this one. First of all, in -- when you're talking about being in battle space, where people are fighting and dying, there is a sensor we haven't figured out how to replicate yet, and that's the one that sits on your shoulders. And the situational awareness it gives you to conduct activity in that battle space is unlike anything else we have been able to cobble together up to this point.

If we are ever able to replicate that, I think the game changes. Until we are, I think you have to put unmanned systems in the mission areas where it makes sense to have unmanned systems, because they're better at that job. I don't think, at this point in time, they're better at every job.

You know, we still have less than 10 percent of our total fleet is remotely piloted aircraft, so it's not like they're taking over at the moment, and we've got to be very careful going forward not to assume that they will in every mission area. We will continue to expand this mission area. We'll continue to use it where it makes sense, but we've got to take it a little bit slow and not get our ideas way out ahead of the technology we have.

By the way, one of the guys who makes sure we don't do that, I just noticed that David was sitting here in the room. Master Sergeant David Keirns just sitting in the back row, he is the 2014 Air Force Times airman of the year, so I just wanted to point him out to you and ask you to say hi if you get a chance. He's a great airman stationed at Rota Air Force Base. He's a C-17 engine guy. Maybe he could build a new launch platform for something. He can probably build anything.

Yes sir, John?

Q: Yes sir.

Your title here is "Strategic Agility," and you talk in here about taking advantage of pivot points. The lesson though of acquisition programs in the last few years seems to be don't change the requirements, because that causes a lot of expense. So, how do you reconcile the two? Are you going to have more frequent overhauls of the program? How do you take advantage of new technologies as they come along without changing the requirements, changing the technology insertion?

SEC. JAMES: Our best opportunity for this, of course, are in the new programs, the existing programs. They are what they are, and we have to do the best that we can do with the architectures and whatnot that have been developed over the years. But when it comes to the new programs, to the extent we build in modularity, open architectures and the like, this is ways that we can, I'll say plug in different types of capability, different types of technology, as technology changes through the years.

So, that's the idea. The idea is more to inform some of our future programs. We'll just simply need to do, you know, the best that we can do with the strategies that have been created for the existing programs in the past.

GEN. WELSH: It's also within existing programs, I think, you look for pivot points. So we -- we're talking about propulsion. Let me use an example there. If the advanced engine technology demonstrator program proves that you can in fact create systems that save you anywhere between 30 and 45 percent of fuel costs, then we should be building into every fleet we have decision points for implementing that new technology in engine competitions to replace existing engines, because it will pay for itself very quickly. I just think we have to be able to take advantage of things as they change. It may not be a major mission area change overnight, but we should look for it at every level of our activity.

Q: If I could follow up, what's coming up that you can work your new paradigm on? What kind of programs are coming up that will reflect these new -- new ideas?

SEC. JAMES: So, we have a JSTARS replacement, we have a new trainer that will be coming up upon us within the next few years. So, those two definitely leap to mind.

Yes, Luis.

Q: Luis Martinez with ABC News. Can I ask about the recent incident in Africa, (inaudible) Ramstein, with the C-130 that returned from a tour there? Do you have any new developments on the stowaway, and did that incident raise red flags to both of you about the security for your aircraft when they're seasoned? Does this go toward the readiness issue that you're both talking about?

GEN. WELSH: Yeah, I think it raised security flags for everybody involved. U.S. Africa Command has command and control and responsibility for that airplane while it's in the AOR. U.S. European Command obviously has the crew, wants to make sure the crews are trained properly in how to do this.

The latest I've heard about the incident itself is that U.S. European Command now -- now has told us that the young man died of asphyxiation, and that they believe there are indications that he boarded, entered, I don't know how you would phrase this, but he got on the plane in Mali. I don't know if he is from Mali or not. All we know is that they think -- believe he got on board the airplane in Mali.

The only other thing is that he was discovered on a post-mission inspection, which is a little more detailed inspection of the airplane than a routine post-flight or through flight as an airplane lands, gets gas, and turns. The crew chiefs would go out and check inside the wheel well et cetera. He was not in a position he could be seen from there. In fact, they had to remove an outside fuselage panel to remove his body.

And so, how he got in there is a huge question mark, and U.S. Africa Command and the EUCOM will conduct this investigation when we have facts as they find them, we'll share them. But we don't know anything more right now.

Q: And to go as far as the readiness issue, I mean, is this one of the things you're talking about full spectrum, that there might be shortfalls across the board?

SEC. JAMES: Well, I would say it's full-spectrum security. As the chief said, it's the question of what was the security, what are the standard protocols for this sort of thing, because obviously whatever happened here, something fell through the cracks that his boy was able to gain access to the aircraft.


Q: Andrea Shalal with Reuters.

I wanted to sort of pick up on Amy's question and your point about the pivot points, and being able to be more agile in your decisionmaking. I mean, I guess there's no point in asking about water under the bridge, but do you now, looking back on it, think that it was a mistake to create and put so much faith into a program like the F-35 that has three variants, three, you know, very complex challenges?

And to what extent are you able to, going forward, create opportunities for more -- to insert more competition both in sustainment and, you know, potentially a new engine, I mean, you know, all those things as they go along, because you're going to be flying this for so many years?

I mean, so I guess this is sort of, like, you know, looking back, looking forward question.

GEN. WELSH: I think what's important at the end of any program is you can start to feel the program. You should learn everything you can learn from the process that got you from the idea to the actual production line. I think we've learned an awful lot from F-35. We've learned some good lessons, and we've learned some things that we might consider doing differently in the future, and the important thing, I think, is to not look back and be critical. It's to figure out what does it mean about the way forward?

And I think this idea of strategic agility in everything we do is one of the lessons we are learning from this.

The problem on the acquisition side of the house is that we aren't the only ones involved in the process, and the process has to become more agile. I think all of us would agree with that. Everybody involved would agree with that, but how you get there from here is the problem. That's why this is a 30-year document. This isn't going to change overnight, but this is something that should, in everything we do in our master plan, as we look at how we move forward with acquisitions process, acquisition strategy, and development of programs, we should consider this idea of how to become more agile consistently and constantly over time, and it's got to include all the partners to do this with us.

Q: Can I just follow up?

GEN. WELSH: Yes ma'am.

Q: One of the big criticisms early on was the way that this incident was handled, and the inability of some of the key players, i.e. the JPO and the engine manufacturer to actually get access to the aircraft and to be able to start that process quicker.

You know, do you -- are you -- what are you doing about that to sort of save that from -- or prevent that from happening again?

GEN. WELSH: Yeah, I have a little bit different view of that, just so you know. The problem with an accident scene is someone has to be accountable instantly for making sure you control the evidence. That's really important in any kind of major safety investigation. That's the first responsibility of the interim safety board president, who is appointed as soon as the incident occurred. They taped off the area, they began isolating evidence fields so they wouldn't be destroyed, pieces wouldn't be lost. So, the evidence that would help you determine the problem isn't affected in a negative way.

It takes about a day-and-a-half to get the full-time board president on-board at the site and then have experts start to show up to help form the board. That's actually very fast. And it happened about that quickly this time. In fact, something happened that normally doesn't happen this time, and that is on the morning of the second day, General Rand at AETC approved for the interim safety board president to have the flight recorders removed from the airplane before the safety board arrived.

Because until that data is available, trying to piece together what happened is virtually impossible unless there's just some very clear visual evidence of exactly what the root cause was. And so that was actually removed from the airplane and sent to the contractor the second day, which is way, way ahead of a normal timeline.

The confusion got to be what we had not done is put together among the three services and the Department of Defense an agreement that if we had a serious incident, we were going to bring representatives from all the right places together to be part of the process so everyone would have access to the key data quickly so they could make flights or, you know, air-worthy certification decisions so the engine company could have the data to start working the root cause analysis so that the JPO could have the information to know exactly how it affected their test program.

People from all those organizations were there at Eglin. They're there all the time. And they were actually there with the interim safety board, but nobody really knew who was officially the connection to the Navy or the Marine Corps or the JPO. And so we have to put together an MOU. We're working it now among the services and in the department. So next time this happens, there's a very quick response and everybody knows exactly who is authorized, who can get information, how quickly, how are we going to manage it.

We'll fix it. This won't happen again.

Yes, ma'am?

Oh, I'm sorry.

SEC. JAMES: No, you go ahead.

GEN. WELSH: Yes, ma'am?

Q: A year ago, we were being told about the problems in the readiness of the Air Force; half the combat force was not ready to fly. And so it was a big crisis at the time. Now, Secretary James, you said now Congress is potentially going to eat into your -- take money out of your readiness account to pay for these other programs and potentially sequestration is going to be back in 2016.

So are we going to be back to that place where half the force was not going to be ready to fly? Or what kind of measures are you taking now to prevent that and what options do you have?

SEC. JAMES: So, of course, Congress hasn't completed its work yet. And so the message that we are putting forth to Congress, and there are people who are, you know, very, very interested in this, so please don't misunderstand what I'm saying. But as Congress shifts priorities and decides that, yes, this will happen, or no, that won't happen, they are working with the same topline numbers under the Budget Control Act that of course we had to budget against.

So as they are doing this, what we're saying is please don't carve money out of readiness, because readiness is too important to us and we need to recapture some of that lost readiness, which by the way one year won't allow us to recapture all of it.

I would also say certainly something that I have learned and have a much greater appreciation for now seven months into my job is that there -- there -- I'll just take flying as an example. There's flying and there's flying. Flying is not quite like riding a bicycle. You can't stand down for three months and totally get back into the cockpit and be able to do all of the same capabilities with the same level of efficiencies.

You might be able to get back into the cockpit and fly the plane, but there are very, very difficult maneuvers. This is very high-technology equipment, which is why we put an emphasis on the full spectrum of readiness training. This is the high-end difficult type of flying against simulated threats that we could face in some of the most difficult parts of the world.

And so it's particularly that type of flying that we -- that we feel like we've got to have more of, we've got to focus on that. And so these are the messages that we're putting forth to Congress continually.

Q: So are we going to have another crisis in a few months when sequestration hits again? Is that going to be another half the force can't fly unless you get the money from Congress? I mean, what are the -- what's your prediction of what might happen?

SEC. JAMES: So, of course, the law of the land right now says that the so-called sequestration level budget will return in F.Y. '16. So we know what that means for defense. But we're in discussions and it is quite possible that the president's budget request that goes to Capitol Hill could be higher. We're not sure yet, but it could be.

And so in the most recent years, what we have done is we have created several versions of budgets. That's what we did this past year, as you will recall. We have a president's budget level and then we have a lower level. And so I would predict we'll go through something like that again for the next budget submission. We'll put forth what we feel we really need and then we'll put forth if we had to live with it, here's how we would manage under sequestration.

I saw Julian before.

Q: Thank you, Madam Secretary.

Julian Barnes, Wall Street Journal. A question for you, Secretary James, and a question for the general.

Secretary James, in your answer on the RD-180, it sounded like you had a solution there: spend down the stockpile, build more deltas, use SpaceX while you're developing a replacement engine. Is that correct? Are you ready to do that? And why not do it now in order to put more pressure on the Russians?

And for the general, in your framework document, when you think about agility, in your mind, is it more important for future airframes to build them and design them more quickly -- build, design and field more quickly? Or design platforms that can evolve over time and last 60 years? What -- what's the future in your mind?

SEC. JAMES: So, on RD-180, there is no solutions yet. In my earlier answer, I was trying to paint the picture of some of the options that are on the table. And I was also trying to paint the picture that the situation with Russia is serious. We are, you know, quite reliant on the RD-180, but we're not exclusively reliant.

And so -- so we have options here. And so we're taking some time, not a huge amount of time, but some time to think through the way forward. But if there's one underpinning that there is great agreement on is we don't want to have this kind of reliance going forward on Russian engines. So we do need to develop these alternatives.

GEN. WELSH: I believe two things, Julian. I think both are true. It depends on what you're building and designing. But for example, platforms that we are -- have proven that we're going to keep for long periods of time because they cost a lot of money, we should design for longer life; insist on things like open architectures; and be able to grow them over time, whether that's tankers, bombers, fighters that are going to last 50 years, whatever it might be.

There's other things that we should look at -- more rapid acquisition programs, things like weapons, things that have a shorter shelf-life that we know are going to change and that we'll be looking for different solutions for. I think it's a combination of the two. That's where the agility comes in. We don't need to have the same process for everything.

STAFF: Last question.

Q: Any update on the A-10?

GEN. WELSH: Any update? No, sir, we're just -- Congress has the inputs. They're doing their work.

Q: (inaudible) the A-10 (inaudible) effective platform against terrorism? You were a former A-10 driver.

GEN. WELSH: It's a great platform against lots of things. So are the other ones we have.

Q: And do you think terrorism will go away in the next 10 years?

GEN. WELSH: No, but the A-10 issue is not about the A-10. It's about balancing an Air Force to provide the spectrum of missions we provide to a combatant commander. If I asked the combatant commanders today, because I've done it, if you had $4 billion to spend, would you prefer to keep the A-10 and have more CAS capability? Or would you prefer to buy more ISR or other things? I now have a list of 15 things they'd prefer us to spend the money on.

We don't buy our -- we don't make up our requirements. We build and support the joint fight. The combatant commanders create the requirement and we buy capability to support it.

Q: (inaudible) vital platform for CAS and in fact units are fighting over in Afghanistan right now, and we're probably going to be in these areas.

And Madam Secretary, there are critics who say we're not withdrawing from war. You've said we're coming off 13 years of war. You said you couldn't -- we couldn't predict Facebook. How do we know what the next 10, 20 years are going to be like? And will we still be engaged in war around the world? If you look at Iraq, you look at Ukraine, look all over the world, we're still going to be in these battles and more that's going to come.

SEC. JAMES: So, and so my answer to that would be it is possible we will need, after we wind down the combat operations in Afghanistan, it is possible. As you say, we can't predict. It's possible we could get into something else where we would need higher levels of close air support in the next year or two or three.

And if that is the case, we've got it. We've got the F-16. We've got the F-15E. The -- and there's other platforms as well. Additionally, with respect to the A-10, this was designed to be a five-year gradual retirement plan. So it's not as though we ever suggested that the A-10 go away overnight. It was a more gradual thing.

So the close air support mission is a sacred mission. And we got it.

GEN. WELSH: Could we have one more question? We have a very patient gentleman in the front row. But I want to add one more comment here on the A-10.

The question is what do you want to give up instead. Sequestration is the issue. We have to come up with a plan that is $20 billion less per year than the plan we had three years ago when we last did our last full budget -- $20 billion a year. So if anyone else has got a solution that balances Air Force capabilities across the mission areas we are responsible to the combatant commanders for, we'd love to hear it. But we sure haven't found it yet.

Yes, sir? And thanks for your patience.

Q: Thank you. Sean Lyngaas, Federal Computer Week.

Can you -- either of you elaborate on what this strategic framework says about the services aspirations in cyberspace? What capabilities or technologies are you lacking now that you might like to acquire in the next -- over the next months and years? And as a corollary, what the -- the Air Force recently put out a RFP, or a request for -- for papers on the moving target defense command and control capability. I'm wondering what that says about your goals in cyberspace, too.

SEC. JAMES: Can you do it?

GEN. WELSH: Yes, ma'am.

Let me go to the bigger piece. Let me answer the second part first, because I don't know anything about it. I -- I don't know what it means about our goals. I'm not familiar with the details of the papers we put out the request for, other than I know we put out a white papers asking for information on it. That didn't come through my office. I don't know what we're looking for exactly. But we can find out more about that, and I'll see if I can give you a better answer, and we'll get it back to you.

On the -- what -- as far as the framework document goes, what it really calls for is for us to get our act together, and how -- what we're going to do in the cyber domain in the future.

We are making a big change in cyber from an Air Force perspective, from a group of technologies that grew up supporting very focused -- very narrowly focused technical support to human operations. That's where cyber began. And there's lot of organizations in our government who do that. They do it very well.

The Air Force and air component commanders are worried about big effects on big battlefields, because our job is to fight the big fight. So, how do we reshape our thinking in the Air Force to think about executing the five core missions that are our only job? There's only five of them. How do we get to doing more of those jobs in the multiple domains that the secretary mentioned? How do we do more ISR in and through the cyber domain -- more command and control, more strike of different types? What kind of targets now open up to us, and what effects can we now produce that we couldn't before? That's the change the Air Force needs to make in the cyber domain.

Make it mainstream to the five core missions of our Air Force, as opposed to a kind of a niche capability with really talented people doing it behind the green door. That's what this is calling us to figure out how to do.

Q: And a quick follow-up then. With your budget constraints, are you fighting hard to preserve that -- some funding for cyber, in particular?

GEN. WELSH: I think -- I think the funding that we have in there now is pretty stable. There's no intent to pull it out of that domain. And so, we have to become experts in that domain, just like I believe we've become experts in the other two.

SEC. JAMES: And if you remember, one of the things I said -- this is a framework that is designed to inform us and guide us when we're making our money and policy choices. So, as we go forward, if there are suggestions to cut cyber, I think we have a pretty good reason not to.

Thank you all very much.

GEN. WELSH: Thank you.

STAFF: Thank you. And any follow-ups, you can contact the Air Force press desk. We'd be more than happy to help.

Q: Thank you.

GEN. WELSH: Thank you.



The Strategy document is available here.