Tuesday, March 4, 2014

Defense Budget Perspectives: As Our Enemies Advance, What Should the United States Do?



Defense Budget Perspectives: As Our Enemies Advance, What Should the United States Do?

by PETER HUESSY February 27, 2014



The FY '14 budget request for the Department of Defense is at a challenging time with a diverse set of escalating threats and continued financial constraints, it's more important than ever that we try to get the situation on a sound path.  In evaluating the present budget, I've found the most troubling aspect to be the treatment of sequestration.

For the second straight year the impact of sequestration has been really hidden from Congress and the American people.   It's not been fully understood and surely the claims being made for the president's budget, that his budget replaces sequestration, but it really - he says he has a plan to get around it, but it's not a realistic plan.  It's not going to work.  That's the problem.

So we've got to get some certainly in the Defense Department.  We hear that all the time from the private defense contracting world to the Defense Department.  Everybody is worried about that.  And uncertainty has been too much of our problem in recent months.  So this is clearly seen looking at this chart.

We have a chart that the last four Department of Defense budget requests for 2014 spending levels.  So if you would look at that, and the president's budget in 2011 called for $598 billion in 2014.  In 2012 his budget dropped to $586.  His budget in 2013 called for $534 (billion).  And his budget for 2014 now calls for $527 (billion).

That's a big drop right there.  But that doesn't count the sequester, does it?  So sequester is another $50 billion that we've got to wrestle with there.  We've had a pretty serious erosion.

Let's go to chart two.  And 50 years ago the United States spent 46 percent of our budget on defense.  Under the president's budget this year, just 17 percent of federal spending will go to defense.  That's a pretty major reduction and alteration in the nature of the federal government that people have seen in this decade.

Now how about number three?  People complain that the deficit we're suffering in America is a result of the wars in Iraq and Afghanistan. Both wars, Iraq and Afghanistan, over 10 years now amounted to $1.4 trillion.

In one year we had a budget deficit of $1.3 trillion.  We've been averaging a trillion dollars a year for the last four years, and we'll be about $600 billion-plus deficit this year.  So it's an improvement, but this is really a factor that we need to know.  And the base defense budget has only been growing about three percent a year for the last three or four years, whereas food stamps have gone from $20 billion to $80 billion - four times.

Whereas Medicare, Medicaid, Social Security are increasing at five and six-plus percent; and those are the ones that are on an unsustainable course.  You can't have an economy growing at two percent a year and have your spending increase at six percent a year.  That's the very definition of an unsustainable debt course - financial course.

How about the next one, Joe?  That's the percentage of defense and the percentage of GDP.  Many of you are familiar with that.

From '46 to 2000, post World War II, we spent seven percent of GDP on defense.  2001 through 2013, four percent.  2014 to 2013, we're projected to be at three percent.  And the number continues to decline.  We'll be hitting in 2023, an all time World War II low of 2.4 percent of GDP.  And so our commitment is below the commitment we've asked the Europeans to make, below our commitment - certainly our historical level.  So we're trying to deal with the BCA and the sequester.

And we have another chart.  This gives a further perspective.  Under full sequestration the defense budget will actually shrink in inflation-adjusted dollars by 11 percent, whereas non-defense spending will increase 44 percent.  One half of the sequester cuts are falling on one-sixth of the budget, the defense budget.  It takes one half of it.  And the non-defense budget is able to supplement their cuts and reduce the cuts they take by getting two percent of the non-defense cuts out of Medicare.  In fact, the other government programs that we fund don't take as much of a reduction.

And let me tell you what's a really tough deal.  In 2011, in August, we hit the debt ceiling again. That became the focal point of a national discussion about how to deal with our unsustainable debt course.  And it was a national debate, a healthy national debate.

The conventional wisdom was this was horrible. You had a discussion about spending and you couldn't reach an agreement until the last minute and the country is going to sink into the ocean.  But we made it out of the discussion, and there was a big disagreement.  So what came out of it?

They agreed to raise the debt ceiling $2.1 trillion, which we've already hit again.  So in August of 2011 we added that much to the debt already and we're already padding it to continue it a little longer.  And we agreed to reduce spending over 10 years by $2.1 trillion - reduce the growth of spending by $2.1 trillion.

So we were spending $3.7 trillion a year at that time.  So over 10, that would be $37 (trillion)[with no increase-editor].  We were projected to go to $47 trillion over 10.  This cut the increase to $45 trillion instead of $47 trillion.  So that's the perspective we're in.

They put in this committee that was supposed to find the cuts, but if they didn't have the cuts the sequestration would take place.  And that was aimed at, I guess the Republicans.  You guys - we don't care about defense, you guys care about defense - I guess is what they were basically saying.  You'll have to agree because if you don't agree we'll cut defense, and you won't like that.

That's kind of the approach Jack Lew forced in there, and our guys agreed to it because they thought the committee would probably reach an agreement.  And I remember being shocked as the Budget Ranking Member, to see that in there.  And that was one of the reasons I didn't vote for the bill.  You know, the committee will reach an agreement, don't worry, was the mentality.

And it passed, and so right now it's beginning to bite and we're beginning to feel it.  So we had a Budget Committee hearing last week and General Dempsey and Secretary Hagel were there.  And they were telling us the problems and we were commiserating with them.

I did tell him, I said gentlemen, you've been sharing this with Congress for some time.  You have a lot of sympathy over here.  But if you have the phone number of 1600 Pennsylvania Avenue, I suggest you make a phone call to the commander in chief.

Because what he's saying is we'll take no more cuts anywhere else in the budget to smooth out the reductions and reduce the pressure on the defense cuts.  The only thing they're demanding is more taxes.  And they just got $600 billion in more taxes in January.

And this agreement that he signed in August of 2011 simply reduced the growth of spending by $2.1 trillion.  It had no tax cuts, no tax increases, in it.  So I think the president owes us a response.  Are you just going to have it all fall on defense, as this chart shows, half of it on one-sixth of the budget?  Or, as commander in chief, are you going to help us find some other reductions in areas that receive no cuts?

So you have no authorizations except the two percent on Medicare, and there's probably some other things that could be done there.  No changes in Medicaid, which is surging at six or so plus percent a year.  No changes in food stamps.  No changes in a lot of other programs that could be altered and help balance the scales so we have a more logical way to reduce our growth of spending a little bit -- that I mentioned to you - and not do damage.

So I think the commander in chief owes it to the men and women he deploys in harm's way to do more than just say I'm not doing anything but raising taxes.  That's the only way we're going to do this, because I don't think it's going to reach an agreement.

So, the problem is, you see the intensity of this disagreement.  It's very real and it's very likely not to be settled by raising taxes.  And the Republicans believe that they had an agreement to reduce spending without raising taxes.  And they've been proposing other ideas about where we could spread the cuts around the government and make it more palatable, and we've gotten nowhere with that.

So I guess the White House just says, well, we've got a plan, raise taxes.  But we're not together on that.  And I'm afraid we may not get together.

So this is a really big problem and a lot of you understand it.  But I wanted to share with you the intensity of the issue.

Mitch McConnell recently said it's a question of fidelity, I believe was the word, to the American people.  We said we were going to cut spending $2.1 trillion.  So when you eliminate the sequester and replace it with tax increases, you've increased spending.  You eliminated the spending cuts that we proudly announced we had achieved.

So I don't have a problem with spreading them around the different agencies.  I really think that we absolutely should do that.  But to replace that and increase spending over the modest reduction that we had, I think it would be very, very difficult to achieve and I'm not prepared to support that.

So that's where we are.  And I hope that all of you will be thinking about it.  And I guess if you were a diabolical political "guru," and you were part of the "cut defense gang," and you could get defense cut and blame it on the Republicans, that would be a winner, wouldn't it?  Wouldn't that be brilliant?  It's too close to being the reality today.

So, four years ago on missile defense issues Senator Lieberman and I wrote Secretary Gates expressing concern about GMD cuts that were being proposed in the 2010 budget.  And GMD suffered a 35 percent reduction from fiscal year 2009 levels.  The deployments of GBIs, if you remember, were cut back from 44 in Alaska to 30.  And I objected to that. And for good measure they cancelled the multi-kill vehicle, MKV.

So thanks to the efforts of Secretary Gates some of that GMD funding was replaced and restored.  But for the most part GMD remained mostly on life support during the last four years and we're seeing some consequences today.  Because threats advanced quicker than were expected, Secretary Hagel, I'm pleased to say, did reverse that decision and decided to restore the 14 GBIs we would emplace.

And, of course, they'll be more costly now because we didn't keep the program on pace.  Admiral Syring is now on Capitol Hill with a briefing talking about the need to improve our radar discrimination capabilities for GMD, including a discussion of the X-band radar.  And that is something that I certainly think we can do.  And I think I would say to you we had a very good discussion in the Armed Services Committee, and have bipartisan support for doing a third site for a missile deployment on the East [coast]and with as many as 20 interceptors.

So I think that was good.  But we did vote out the X-Band radar system.  That was done.  And we did not vote explicitly to advance the new site

But without the European site we really need an East Coast American site pretty surely.  So we talked about it in committee and I felt pretty good about that.  So it was a bipartisan group.

Now the House, the HASC version, includes $140 million for a third site.  That's good for conference purposes.  The House Appropriations Committee has $70 million in it.  We put $30 million in, in our bill.  So I think there are prospects for advancing that in the committee.

Everybody seemed to be understanding the need for a third site.  The only question is in a tight budget time what can we do about it?  We don't have enough money, they say, and that's true.

But if you look at what happened in the fiscal year 2012 to 2016 five year projections for Missile Defense Agency, we were projected to spend $43 billion over five years.  The five year spending projections in this year's budget for 2014 is only $37.6 billion.  So it's really a net drop of $5.9 billion in MDA funding over the next five years.

And that's what's putting us in a fix.  If we had that money we could complete the third site pretty easily.  Admiral Syring's spending power has declined by about a $1 billion a year before taking into account the sequestration.

Quickly, modernization.  The Armed Services Committee fully funded the president's request for NNSA weapons activities.  Unfortunately,  the president's request fell short of the New START commitments that he made, rather significantly.  To secure Senate support for New START, the president committed to increase funding for NNSA nuclear weapons activities by $4.1 billion between fiscal year '12 and fiscal year '16.

We need to do this.  Everybody understands the need for it.  Taking into account Congressional actions, sequester cuts and shortfalls, that increase will be scaled back by about $1.4 billion, or 34 percent.

In fiscal year '12, $385 million was cut by Congress.  In fiscal year '13 the administration request fell short by $343 million, while an additional $600 million was cut due to the sequester.  The fiscal year '14 request fell $285 million short.  So this begins to add up over time and puts you in a position where it's difficult to accomplish what we've committed to do.

The life extension program for the B-61 nuclear bomb, which has got to be done, was delayed by two years in the fiscal year '13 request, and is now likely to be delayed another six to 12 months, pushing it back beyond 2019, which creates risks associated with a component in the bomb that is reaching the end of its life.  So we've got to get that fixed.

The FY13 request: we were told in that request that we had a three year slip in the life extension program for the W-78 and W-88 bombs, the interoperable warheads. According to the FY14 stockpile stewardship management plan, the date for the W-78/88 interoperable warhead has slipped another year.

The nuclear triad.  Ohio-class nuclear ballistic missile submarine replacement has been delayed by two years, leaving the Navy with no margin for further schedule slip.  As a result of this delay, our SSBN force structure will decrease, it appears, below the operational requirement of 10 SSBNs at about 2031.  Both Navy and StratCom believe there is moderate operational risk associated with this plan.

And the long-range standoff missile - a replacement for the 1980, 30-years plus missile, air-launched nuclear missile - has been delayed two years.  The contractor award on that has been delayed.  After three years of study, the next generation of bomber does appear to be ready to move forward with development, with the FY '13 [NDAA] requiring that the bomber be nuclear certified within two years after initial deployment.  And the administration is conducting an analysis of alternatives for a follow-on ICBM.

So the gap continues to grow between what was committed to as part of the New START process, and where we're actually going to end up, and I'm worried about that.  I was particularly uneasy about the president's announcement.  We got an advance call about it.

But in Berlin the president said this, "So today I'm announcing additional steps forward.  After a comprehensive review I have determined that we can assure the security of America and our allies and maintain a strong deterrent while reducing our nuclear weapons by up to one-third.  And I intend to seek negotiated cuts with Russia to move beyond Cold War nuclear postures.  At the same time, we'll work with our NATO allies to seek bold reductions in U.S. and Russian tactical weapons and forge a new international framework for peaceful nuclear power and reject the nuclear weaponization that North Korea and Iran may be seeking."

That's a big change, with 1,550 weapons today, and we've been reducing rather dramatically.  And now we've just had our president announce that we're going to have another third reduced.  And it causes me concern.

And I believe it's going to cause Congress concern because fundamentally this is not driven, it seems to me, primarily by a goal of reaching a level that's safe for America.  But it seems to be more driven by an ideological vision of the president of a world without nuclear weapons.

And George Bush said, I think we can get to 1,500 nuclear weapons and I believe we can still defend America.  That's one thing.  But when you've got a commander in chief who's repeated, stated goal is a world without nuclear weapons - and we have very little analysis, it seems to me of this - and announce a further one-third reduction, I believe that has destabilizing effects worldwide.  I believe it's likely to be misinterpreted worldwide.  I think it's a dangerous policy.  I see no need for us to take that big a reduction in our nuclear arsenal at this time.

For example, Senator Hagel - Secretary Hagel, signed on with a small group of folks - [for a] Global Zero report - to have zero nuclear weapons.  And they agreed to pursue an aggressive nuclear disarmament regime.  They proposed reducing 1,550 weapons to 900.  Well, this will take us to about 1,000, almost what they asked for.

Of the remaining 900 total nuclear weapons, the Hagel report, Global Zero, said 450 would be deployed, 450 would be placed in reserve.  That's only half actually deployed.  Deployed weapons would be de-alerted, requiring 24 to 72 hours to launch.  That was in their plan - the man chosen to be Secretary of Defense.

Our reserve warheads would require weeks and months to be placed in a launch ready position.  Under their plan all land-based ICBMs would be eliminated.  All tactical nuclear weapons would be eliminated.

The strategic bomber force would be reduced to 18.  All B-52s would be decommissioned.  They would re-structure or downsize nuclear modernization programs.  [OHIO class] submarines would go from 14 to 10.

So this is the atmosphere in which we are operating.  The Schlesinger-Perry report came nowhere close to recommending such a plan.  And during the writing of their report it was quite clear that our allies around the world are very uneasy about us now.  And so if your goal is to avoid nuclear proliferation, aren't you likely to incentivize many of our allies who have felt safe under the U.S. nuclear umbrella, to feel like they've got to have nuclear weapons now?  And does anybody imagine that Iran or North Korea are going to see the example of the United States going to zero nuclear weapons and somehow that's going to cause them to not develop nuclear weapons?  Unlikely.

I had an opportunity to meet with some Russian officials and individuals, and one shared with me, when I asked about their plans, and he said we're never giving up nuclear weapons.  And we're far outnumbered in tactical nuclear weapons.  So the Russians are willing to discuss the reduction of strategic nuclear weapons, but they have a massive lead in tactical nuclear weapons and won't discuss that.  Yet apparently our Secretary of Defense in his report is prepared to consider the elimination of all tactical nuclear weapons in the United States.

So I would say to you sophisticated observers of the American scene, I really think we've got to be careful about this.  I think this has ramifications far more than just a political dispute.  We're talking about a fundamental alteration of the posture of the United States with regard to nuclear weapons.  We haven't sufficiently talked about it.  And to the extent to which it's based on a presidential goal and a Secretary of Defense goal to eliminate all nuclear weapons, I am deeply troubled by it, because I don't think that's realistic.

I can't imagine the world will be heading that way.  What we've got to do is be mature, careful, responsible managers of our nuclear arsenal in a way that advances peace.  I would suggest to you this kind of policy could endanger peace far more than maintaining a sufficient arsenal and being consistent and firm and clear in how we intend to use them.

Some of the things that are said about it, really, is it seems that nonproliferation and disarmament, rather than nuclear deterrence, now are the guiding powers and forces in our theory of nuclear weapons.  Think about that.  That seems to be it, pretty much.

So the number and the role of nuclear weapons is being reduced.  And the president made clear the U.S. will not develop new nuclear warheads or pursue nuclear missions.  And in Japan, not long ago, or South Korea - he goes to South Korea and says in March of last year, "As president I changed our nuclear posture to reduce the number and role of nuclear weapons in our national security.  I made it clear that the United States will not develop new nuclear warheads and we will not pursue new military missions for nuclear weapons.  We've narrowed the range of contingencies under which we would ever use or threaten to use nuclear weapons." Well I don't know how that made the South Koreans feel, or the Japanese, facing concerns that they face around their neighborhood.  How could it make them feel more confident in the United States' reliability as a partner ?  So that is an issue of significance.

I'm sorry to run on so long, Peter.  Do you have time for questions?  I'd be glad to try to answer any questions that you have.  Thank you for your interest in American defense policy.  It's important that we talk about these issues publicly.  We can agree on a lot of things.

You know, last year our defense Armed Services bill was unanimous.  This year we had almost unanimous, the no votes being basically on the concern over the sequester, I think, and how much money - whether we should mark to this full amount or current law.  And so I think we shouldn't over-emphasize the disagreements.  Senator Levin has done a good job, and Senator Inhofe, of keeping us on a pretty good bipartisan course.



MR. SYDNEY FRIEDBERG:  Senator,  Sydney Friedberg from Breaking Defense News.  I certainly agree with you that the Senators - the president's budget request is basically dead - (off mic).  But I would say equally that the Senate and House budget resolutions are a fantasy - that the SASC and HASC have marked up - are fantasy.

If numbers are imaginary, this would make up negative one.  And it seems like everybody is hand-waving and nobody is leaning towards compromises in this bicameral, bipartisan executive-legislative branch problem.  Is there any island of reality and how do we get there?  How do we paddle over the water there ?

SEN. SESSIONS:  I was just telling you, I'm worried about it.


And it is difficult to justify marking up to a number that is not likely to be the number we're going to appropriate.  I voted for the bill in committee.  Secretary Hagel has promised that he'll submit us a report on how he can manage these reductions better.  That's supposed to be coming shortly.

But I'm uneasy about it.  I made a floor speech that night saying that I was not going to be able to vote for a bill that didn't comply with the Budget Control Act, and part of which is the sequester, as a total number of cuts; and favored and advocated in that speech, as I did to you, that there are other places we can find savings.  So I think we're in a very grim position.

MR. RICHARD WEISS:  Richard Weiss, Hudson Institute.  One of the issues that has come up recently is that the administration has reached an agreement finally on what to do with the Nunn-Lugar program in Russia.  But the details  (haven't been ?) leaked to the media.  I don't know if you had any insights about the program?

SEN. SESSIONS:  I do not.  I should know, but Nunn-Lugar has done a lot of great work.  And where we are in that, I don't know.  We'll have a dispute, when we talk about Russia, over the power of the president to reduce nuclear weapons.  We may have a floor vote and debate over whether it should be done by treaty or can it be done by executive negotiations.  So the matter of the reduction of weapons is not firmly settled at this point.

MR. KEN FLEISHER:  Kenny Fleisher with Nuclear Weapons and Materials Monitor.  Given what you were saying earlier about the president backing away from commitments on modernization, is there anything he can do at this point to regain the trust of Republicans and show that he's willing to work with you?  Or, has the well already been too poisoned to (set his teeth ?) on that?

SEN. SESSIONS:  Well, I think we can definitely get that program back on track, and would like to see it so.  I've made clear I was prepared to see if we couldn't do it in a more cost-effective way.  The proposal to build two buildings at $12 billion - to build two buildings?  I mean, I thought that was a bit excessive.  That is a bit excessive.

And they built one of the biggest steel mills in the world in Mobile, Alabama - north of Mobile - in about two years time.  And the whole plant and everything in it was $5.7.  I can't imagine a physical plant to make weapons have got to cost that much money.  I don't believe anybody else in the world is coming close to spending that much money.

So we've got to look at the budget.  And I am concerned that Energy has less intensity of interest in containing cost than they need, because they just get the money and produce the weapons.  And we say we want the weapons, and they say we need so much money.  Somebody needs to say, you're going to produce the dad-gum weapons and you're not going to get that much money, it seems to me.

But it's hard to determine exactly what it takes.  I'm not a nuclear engineer.  So it is hard to know exactly, and it takes a lot of money to maintain and modernize nuclear weapons.

And I'm prepared to work with the president to try and do that in the most cost-effective way.  We do not need to allow this issue to doddle without being put on a course that we can see completion at an appropriate time. And that's what's scaring a lot of us now.

MR. RICHARD BAINEY :  Senator Session, I'm Richard Bainey with American Company.  You've expressed some concern of what our allies might do potentially in Europe or Asia if we reduce our nuclear capability.  This question is not directed to what Iran or North Korea might do, that's a separate issues.  But is there any specific policy directives that have come out of either Europe or Asia that have shown a change in their defense posture because they are concerned about a reduction on the American side, any specific policy initiatives or developments?

SEN. SESSIONS:  Well Japan has certainly begun to talk more openly about changing their historic policy, and you could see more of that.  The Soviets are definitely advancing - the Russians are definitely advancing their capabilities for nuclear weapons.  We're the only country in the world that has nuclear weapons that doesn't have an ongoing production capability.  So it's an odd position we find ourselves in.

I think it has been going on so long that we can't wait much longer.  We've got to alter that and have more clear policy so the whole world knows where we are.  That stability, that constancy of purpose and clarity of purpose, bipartisan, that has been maintained for so long, I think has been a positive force for peace in the world.  Others can disagree, but I don't think it's disputable.  And I think altering that in a significant way, which I'm afraid the president's policies are doing, is likely to create more risk rather than less risk.  That's what I'm concerned about.

MR. ROD KEEFER:  Rod Keefer, I'm with Northrop Grumman.  Unsaid in the president's announcement about the one-third cut in nuclear weapons was, what are the level of platforms?  And by platforms I mean the Navy submarines, the Air Force bombers and the silo-based ICBMs.  So what's your thoughts about maintaining the resilience, the stability, the nuclear deterrence capability of the nation as we go to lower warhead numbers; again, (unsaid were the platform numbers ?)?

SEN. SESSIONS:  Well I've been worried that there's a subtle plan to, you know, alter the triad significantly.  So I've supported - was it two years ago, Peter Huessy, we got language that the Defense Department has to notify Congress before any change in the triad occurs.  That may have been why we got a preliminary call before this speech in Berlin.

You're right, if you just keep squeezing it down then you can crumble the triad without ever having to say I've eliminated this leg or that leg.  It's a historic part of our defense posture that I think should be only changed with great care so the whole world knows if we were to make a change that we've got alternatives that would work just as well and effectively.  I don't see us at that point yet.  And the budget and policies could lead us to crumbling the triad, if not altering it, whether we want to or not, whether it's smart or not.

MR. HUESSY:  Senator Sessions, let me ask you a question that one of our previous speakers, Clark Murdock from the Center for Strategic and International Studies said, that a survey of their group of left to right analysts  concluded that further reductions in U.S. and Russian nuclear weapons is not going to be beneficial with respect to dealing with Iran, North Korea and other proliferators.  You mentioned the Koreans and Japanese have said they think seriously about their own nuclear deterrent, which would increase proliferation.  What's your sense as to the views of the Armed Services Committee and defense-minded Senators as to whether or not we should be pursuing further cuts in U.S.-Russian nuclear weapons, or whether we should be concentrating on dealing with the proliferation problem?

SEN. SESSIONS:  Peter, I think that's an odd thing that we're doing.  And implicit in your question is that we seem to think the only thing that's important is our relation with Russia.  Well, we hope we're in a relationship with Russia that nuclear weapons aren't totally the dominant factor anymore.

And so, it's odd that you would think that somehow if we negotiate with the Russians this is going to set an example.  And they use the word example frequently in their zero nuclear weapons theory, that this will send an example.  To who?

Is it going to alter Pakistan's view, India's view, China's view, North Korea or Iran's view?  I don't see it.  I mean, it's baffling, to me.

It's a pretty serious weakness in their theory of this.  But it's a theory of the left, you know, that somehow we've just got to get rid of nuclear weapons.  And I wish we all could.  Don't we all?  But, maybe not, some would say.

Ronald Reagan said the same thing, you know?  But I think we need to be prudent and responsible and ask ourselves very seriously, is this really going to help maintain peace in the world if the United States' nuclear capabilities are no greater than half a dozen countries in the world?  And how many countries could get them and we'd cut again?

I mean, this is not the last reduction.  The president's goal is to go to zero.  So will he be promoting more cuts in the next year or two?

And at what point does it become rather easy for a potential adversary to say, we can be a peer competitor to the United States.  We can build that many weapons.  They won't push us around anymore.  So they've got a big army, we've got a big bunch of nuclear weapons.  We don't have to take anything.

You know, you can just see how the mentality could get into people's minds.  It would be destabilizing, not peace enhancing, but danger enhancing actually, it seems to me.

One more and I'll wrap up.

MR. NICK CRAMER   Senator, Nick Cramer with GAO.  You talked about the need for increases in missile defense and nuclear spending.  Are there any areas you see that are ripe for cuts in missions or are we kind of (at the bare bones where we need to be?)?

SEN. SESSIONS:  Well, that's a good question.  As I indicated, the budget has been slipping substantially for a long time.  And you've got this huge long-term investment in missile defense that it would be a tragedy not to complete.  In other words, we've spent all this research and development, we now can hit bullet-to-bullet and collide.  We've proven it time and again.  We'll continue to do so.

So if we had to go from 44 in Alaska and add 20 more and another site, I don't think that's too great a cost - out of the $500 billion that we spend on defense every year.  And you've got it and you've got the ability to look one of these adversaries in the eye and say, if you launch a missile up here we're going to knock it out of the sky.  We're not intimidated by you.

It enhances the power of the president to be confident in negotiations and the American people to be confident that we don't have to go, oh gosh, if the president says no to this country or that country they can lob a missile into Los Angeles.  We need that confidence.   And if it takes a little more than we're currently spending to get there, I think it's worth it.

But, on this, I don't think it's likely the end of the sequester is going to involve complete restoration of the entire amount.  So you've got the $50 billion hit the Defense Department has taken, the $500 (billion) over 10 (years), and you've got this one, too.  So there will still be some additional squeezing of the Defense Department and you'll have to continue to make more cuts.

And I think the Senate, bipartisan, is going to be far more intensely interested in managing contracts, containing cost over-runs.  And GAO is a big part of helping us do that.  It's critical in that process.

Thank you.


MR.  DAVIS:  I once had a boss who said a problem well stated is a problem half solved.  And while we may not be walking out the door this morning with these massive problems solved, they have been well framed.  Thank you very much.  We also have an ROA coin.  It's less than $20 so you can accept it.

SEN. SESSIONS:  Maybe the ROA forgot when I was in the Army Reserves and I became a lifetime member, then they quit sending me - do I have to pay another $20?


MR.  :  I've got it, Senator.  Those were the days before computers.

SEN. SESSIONS:  Thank you.

MR.  :  Thank you, sir.


MR. HUESSY:  We are having a small break and then we'll have from 9:30 to 11 the Army War College will be here.  Please stay here if you would like to attend.  And also remember, Frank Rose is meeting with us tomorrow.  Senator Sessions, thank you for your remarks.  Thank you for your service.  Good luck and God's speed in what you're trying to do.

SEN. SESSIONS:  Thank you.





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