This is a program--the
Nunn/Lugar program or the cooperative threat reduction program
-- which has been under some criticism by some members of the Congress,
and I want to specifically call it out then. The purpose of this program
is to reduce the nuclear threat to the United States. This has been
challenged as being a non-defense program. I refute that challenge.
I call it defense, but defense by other means.
This program has
funded and assisted in the dismantling of 2,000 nuclear warheads which
formerly were targeted at the United States. A very significant achievement
in that regard.
In addition to
the dismantling of nuclear weapons, it assists in the safety factor
of these weapons and also assists in our non-proliferation means by
controlling -- helping the Russians control and safeguard -- both their
weapons and the fissile material that's associated with those. We regard
this program as a crucial program to our defense.
The last component
of this program is perhaps under the most criticism. This has to do
with the support of reducing the infrastructure which supports the Russian
and the Ukrainian nuclear program. We believe that is equally important,
and I will defend this vigorously to the Congress as being very much
in the national interest of the United States and very much a defense
program.
If you noticed,
there was a slight decrease in funding for the Nunn/Lugar program
from $400 million down to about $380, I think the number was. That does
not reflect a decreased emphasis. It's just the details of the program
as you go from year to year. There's different emphasis on different
aspects of the program.
Now I want to go
to the part of our challenge: managing the drawdown in the post-Cold
War era, which affects most directly and in larger scale, our budget
planning. The first is to maintain the force structure; the second,
protecting readiness; the third one is ensuring the quality of life;
and the fourth, the plans for recapitalization. I'm going to be talking
about each of these, and each of these really represents a key challenge
as we went through the budget in allocating resources to maintain each
of these objectives at a reasonable level.
This is the force
structure that this budget will support for '96. I compare that with
the Cold War force structure, the force structure which was projected
by Secretary Cheney in the base force, the goal which was called for
in the Bottom-Up Review. I have several points I would like to make
about this.
The first is that
the drawdown that's been going on in the force is nearly complete with
the '96 budget. You observed that the Army's active divisions in '96
will be down to the ten divisions which the goals call for; that the
Air Force will be down to the 20 wings called for; the Navy will be
down to the 11 carriers called for in the Bottom-Up Review. They will
still have 19 more ships to go. Also, the Reserve component still has
some brigades to go down, but essentially, the drawdown is complete
in terms of force structure. It is also nearly complete in terms of
personnel. That's a very important point, because it has been very difficult
managing the turbulence that comes from the very large scale reductions
that we've had underway, and those are nearly behind us now.
This chart represents
the fact that the personnel turbulence reduction is nearly over. From
FY94 to FY95, we have the following changes in personnel, and you'll
see that they total 88,000 personnel -- a fairly substantial reduction.
That is underway right now as we speak.
In '96, there will
still be some reduction, but you can see it is less than half of the
reduction in '95. So with the '96 budget [inaudible] as we see in the
'96 budget-- the worst part of the drawdown will be over. I would also
point out that in '96, in most of the areas, we will have completed
the drawdown. The Army has 495,000 personnel by the end of '96 and that
is the goal. The Air Force has 388,000 -- very, very close to their
goal. The Marine Corps, right on their goal. The Navy still has a few
percent more to be reduced. So the active duty drawdown is essentially
winding up in FY96.
On the other hand,
the civilian drawdown will continue. You'll see that in FY96 we're planning
a reduction of 38,000 personnel. That continues. We will have a total
of 829,000 personnel. We still have to get down to 728,000.
To summarize the
personnel situation, we are decreasing about 32 percent for both active
duty and civilian. We started the active duty drawdown earlier and it
is nearly complete now. The civilian drawdown started later. We accelerated
that in this Administration, but even with that acceleration, it will
have to go on for another few years beyond that before the civilian
drawdown is completed.
This is a very
important charge which has to do with our current readiness. This has
been, as you know, a subject of debate and controversy. I'm going to
make two major points on readiness. The first is that our current readiness
is in good condition; and second, I will talk to you about what our
budget is doing to sustain those high levels of readiness.
Why do I believe
that the current readiness is high? First of all, and I list here the
factors I have to guide me on that. First is a report from the Commanders
in Chief. I get every quarter a very detailed report from all of our
CINCs in the field. This is one of the important ways of monitoring
readiness. It ignores the statistics and gets down to the commander's
judgment about the readiness of his forces to perform his mission.
I met last week
with each of the Commanders in Chief, and [of] each one of them we asked
the question. " What is your readiness to perform your mission?" Each
one of them reported to me they are ready to perform their mission.
That is the bottom line and the most important bottom line in the whole
picture.
I might say that
they have demonstrated that readiness in the deployments to Haiti, the
deployments to Iraq, and the deployments to Rwanda last year. Anyone
that looks in detail at the skill -- the professional skill with which
those deployments were executed -- would agree that the CINCs were right
when they said they had the readiness to conduct their mission.
We have, also,
voluminous statistical reporting on readiness. We could bring in stacks
of data to show you on this. Some of those are very revealing, some
of them sort of obscure the issue. But if you aggregate them, what they
show is that the early deploying units -- the units that we have either
in the field in a forward deployment area, or we have in the continental
United States alerted to go on early deployment, all of those are not
only at high states of readiness,[but] that high state of readiness
is essentially constant over the last decade. So the statistical reporting
backs this up.
I would make one
other point about this current readiness: that the area of problem which
I reported last fall, namely in three Army divisions being at a lower
state of readiness, these were, first of all, not the forward units
-- not the high ready units -- they were the late deploying units. Nevertheless,
that problem will be fixed by April or May of this year, based on the
application of the supplemental which we got last October, but based
on the application of the training program for these divisions.
Now I want to project
forward to future readiness. This budget does protect that readiness.
The reason it does is in the guidance which I gave to the services when
they prepared the budget : I stated clearly and explicitly on the first
page of the guidance to the services, [that] maintaining the readiness
of the force is your first priority, and you may trade off any other
objective which I give you in order to achieve that readiness. That
was a very clear and unambiguous direction. The services followed that
direction.
On top of that,
the President added $25 billion, at our request, late last year to enhance
readiness and to enhance quality of life, about which I will say more
later.
When I reviewed
this '96 budget with the Service Chiefs, I asked each of them the question,
"Does this budget, as you have submitted it and as we are approving
it, sustain your readiness?" The answer from each of them was, " yes,
but..." And I'll get to the "but" in a minute.
In particular,
they confirmed that they had fully funded all of their requirements
for operational training and had fully funded the depot maintenance
that was required to maintain two major regional conflicts simultaneously.
The "but" that
they gave me was that the funds were there in the budget to do that,
but if there were contingency operations during the year which diverted
those funds, then that would obviously upset those plans. So therefore,
we need not only to have the funds in the budget, but we have to have
a way of dealing with the historical diversion of funds for unplanned
contingencies.
I want to remind
you that our budget trains and sustains the forces. We have nothing
in the budget for using the forces, for sending them out into an operation,
for a contingency operation. So any time we go into contingency operations
we have to seek supplemental funds for that.
We are dealing
with that problem this year -- so we will not repeat the problems we
had last year -- in two different ways. First of all, by requesting
an emergency supplemental of $2.6 billion. That $2.6 billion is sufficient
to fund all of the contingency operations which are already underway
and which we project will be in operation through FY95. Therefore, if
that supplemental is granted, we do not anticipate any diversion of
funds from the '95 budget which would cause these readiness problems
to recur.
Secondly, we are
going to request the Congress for new authority. This requires a legislative
change which we're calling the readiness preservation authority. The
supplemental will deal with the contingencies already underway, and
therefore, are predictable. We still have to contend with the possibility
that we will have unexpected contingencies in the fourth quarter of
the year, for example. When that happens, we're down now to almost the
end of our O&M budget. We have the contingency. We have to fund
it immediately; and therefore, it comes out of the only place it can
come out -- which is our training accounts. At the same time, we don't
have time to get a supplemental through and approved by the Congress.
So we are asking the Congress for authority to divert money from other
accounts to deal with a problem like that under the very special circumstances
which will be defined in this Act. Namely, we have this unexpected,
last-minute contingency operation [that] comes up. I hope and I believe
we will get the support from the Congress for that.
These two things,
then, will solve the readiness problems we've had in the past. The first
is fully funding the account, and the second is providing a safeguard
of protection against the diversion of those funds.
All of this that
I've described, there's still a certain uncertainty and confusion about
anything as complex as trying to maintain the readiness of 1.5 million
personnel in the field and all the complex equipment. Therefore, we
have to watch it very, very closely. We have established the Senior
Readiness Oversight Council specifically for that purpose. The Deputy
Secretary is the chairman of this. It meets once a month. The services
and the Chiefs bring in problems. The purpose of that commission is
not just to hear the problems and comment about them, but to act to
fix them. We have in this committee all of the people who have the authority
to act to fix the problems just as they occur.
Finally, we have
something which I have called many times MBWA -- management by walking
around. Going out to the bases and sitting down and talking with people
and asking them about their problems. I do that every month. The Chief
does it frequently. The Deputy Secretary does it. Most importantly,
we have in the building our senior enlisted personnel who spend nearly
all of their time out at the bases talking with people, getting an assessment
of problems. I meet with them frequently to get their assessment of
the problems.
These are the set
of actions we have taken to give me the confidence to say we not only
have high readiness today, but we're going to be able to maintain it
in the future.
Let me give you
this one little example of what is in the budget. I'm not talking about
dollars now, I'm talking about the things funded by the budget. This
budget will fund 800 annual tank miles; it will fund 14.5 flying hours
per crew per month for helicopters; 24 flying hours per crew per month
for the Navy; and just under 20 flying hours per crew per month for
the Air Force. These are the operational training rates which each of
the services believe is adequate to maintain a high rate of proficiency
in their training. Every time I go out to one of our operational units
-- to go to a training base -- and see these training exercises being
conducted and see the skill with which our military personnel are conducting
these, I am impressed that this is exactly the program we need. All
we have to do then is be sure that we do not divert funds from these
programs in the last quarter or so, and we will maintain a very high
rate of proficiency.
All of this comes
down to the fact that this budget, as we have said before, puts people
as a first priority. That's not for any sentimental reason. That's because
they are our most important asset in being able to carry out our national
security objectives. This chart is just one way of making that point
clear to you.
We talk all the
time about investments. Investments in tanks, investment in ships, investment
in buildings and so on. Here, this chart talks about investing in people
and why it is important.
It takes 16 years
to develop an aircraft maintenance supervisor. It takes 22 years to
develop a battalion commander/sergeant major; 28 years to develop an
armored division commander. My military assistant, General Kern, has
been in the Army 27-1/2 years. His next post will probably be as an
armored division commander. He has had just the right level of training
to do that. The key is keeping these qualified, experienced people in
and keeping them trained. That is exactly what we're trying to do with
this program.
Every time I go
out on trips, I not only visit our own troops but I visit other troops.
And I see the comparison between the very high morale -- the very high
readiness of our forces -- and compare that with the other military
forces. I have met and talked with Russian forces I've met and talked
with the military forces of other countries. None of them has this level
of competence that we have. The biggest reason for it is they do not
maintain the professional non-commissioned officers corps that we have.
That takes years and years of training. It takes keeping people in and
motivated, and keeping them well trained.
In short, keeping
quality people -- which is the key to our success I believe-- involves
first of all, that we train them realistically. Our budget has the funds,
for example, for 12 brigade rotations per year at the National Training
Center -- a very key part of this.
Incidentally, one
of the things we lost at the end of last year when we ran out of funds
at the end of the year, we had to cancel one of these rotations. That's
precisely the thing we want to avoid. Nothing is better training than
this similar combat training we have going on at the National Training
Center for the Army, and at Nellis Air Force Base for the Air Force.
That's the RED FLAG exercise, a comparable kind of training for the
Air Force. These are key. Then our field exercises, the BRIGHT STAR
and the ROVING SAND are just a few of the current field exercises being
planned. These are key to maintaining the competence of our personnel
and our units.
In addition to
that, there's been some discussion that if we send people out on missions
it detracts from readiness. I think that's a lot of baloney. These missions
help in readiness to the very great extent.
On VIGILANT WARRIOR,
we had the best exercise we could have had for that brigade at Fort
Stewart: on going over there, joining up with their equipment in Kuwait,
taking it down to the field. They could not have planned a better exercise
than we actually did in VIGILANT WARRIOR.
UPHOLD DEMOCRACY,
we have civil/military units of the special operations forces out all
over Haiti conducting operations. They could not find a better training
exercise than what they're doing now. At some level, after some period
of time, that begins to lose its effectiveness as a training device.
And therefore, we have to rotate people. That's why we rotated people
in Haiti after just a few months of the operation there. We took the
10th Infantry Division out and replaced it with the 25th Infantry Division
so that we would not lose the training edge by having people on deployed
sites too long.
Finally, this last
point here. This is just a catch phrase. We have to reenlist families.
If we want to keep this highly qualified NCO corps in for 15, 20, 25
years, they have to have the incentive to reenlist. Part of that incentive
comes from the pride and their professionalism that comes from this
training. Part of it comes from the excitement of being on real missions.
But we also have to reenlist the families -- it's not just reenlisting
the person in the military service. That's why we are emphasizing this
quality of life initiative. We understand that we not only have to provide
good working conditions for the people in the military service; we have
to provide reasonable living conditions for their families as well.
These are the three
primary components of the quality of life program we have underway,
and I've given you the reason why I think it is important.
Compensation. This
budget, not just for FY96 but beyond FY96, fully funds the maximum legal
pay raise. This is the first time, I believe, in the history of the
defense budget where we have projected -- committed to that -- for full
funding for the legal pay raise for a five-year period of time.
Secondly, it protects
the medical benefits. These are very important to people. I could not
have achieved this had I not gotten President Clinton to authorize the
$25 billion increment in the future years defense program.
The community and
family support programs. These were key in the quality of life initiative.
These are just two examples of things that are covered by them that
make a big difference. Every time I go out to bases and talk with families
and find out what their issues are, these two come out very, very high
on the list.
Finally, what comes
out number one on everybody's list is housing. We just have inadequate
housing at our bases all around the world. And that is a big problem
for people, and it's one of the biggest disincentives to people staying
in the services. The quality of life initiative does have a 13 percent
increase in housing dollars per active duty personnel. That is not enough.
We have to do something beyond that. I do not think I can solve that
problem just by increasing the budget, but we are looking at a housing
initiative which will have off-budget ways of getting more housing on
bases as well.
All of these issues
are being considered and considered in considerable detail by a new
quality of life task force which was set up under the chairmanship of
Jack Marsh who was formerly the Secretary of the Army, and who is going
to bring some real wisdom and experience to this problem.
Now we're down
to the modernization and the recapitalization program. This is important
for the readiness -- not this year or next year, but five years or ten
years from now.
The first point
I would make about that is we have had a reprieve, in a sense, in the
modernization program -- permitted because of the drawdown that was
going on. Without going into a lot of detail on that, let me simply
point out that if we go from 18 divisions to 10 divisions, we have correspondingly
fewer tanks-- fewer armored personnel in the division. Therefore, we
can decommission many of these tanks. The ones we decommission are,
quite obviously, the older tanks. So the process of reducing the size
of the force means we lower the average age of the equipment in the
force. Therefore, the cost of recapitalizing -- the need for recapitalizing
-- can be delayed for a few years because of that factor. So that is
the first point to make.
When I testify
to the Congress I will present the statistics to them which show that,
in spite of the slowdown in modernization the last few years, the average
age of the equipment in the field has not increased. In fact, in most
categories it has continued to decrease.
That is, I think
you will appreciate, though, a short term reprieve. We have to get on
with that because the drawdown is essentially over now, so we will now
have to start getting that modernization ramped up again. We will have
to increase it over the longer term. I will describe to you briefly
how we're going to do that. But I will point out that it will not require
a one-for-one replacement. We do believe that our technology will find
ways of doing things better and smarter -- not only so that we will
get by in some cases with fewer equipment, but that we can sustain our
equipment in the field for longer periods of time simply by upgrading
or modernizing the new technology.
Some of our carriers,
for example, have been in the field already more than 30 years. One
of them as much as 40 years. These carriers are just as capable as the
newer ones because we upgrade them with new electronics and with new
weapon systems. So the question here then is, we do not have to replace
every platform on a one-for-one basis, as long as we have a modernization
program that keeps the electronics and the weapon systems in them modern.
But we do have to make an increase in our modernization program... I'm
going to describe that to you, but the basis of that increase falls
in three areas. We do have an acquisition reform program which I have
talked with this group about several times before. We are counting on
that acquisition reform program for bringing more efficiency into our
system so that we can buy our weapon systems for lower unit costs, number
one; and number two, so that we can sustain them in the force at a lower
cost per year. In other words, the life cycle costs will be decreased.
That's the benefit we expect from the acquisition reform.
Secondly, we are
reducing the infrastructure. The base closing is a primary example,
but not the only example of that. Relative to base closing, we expect
that the savings that we will generate from base closing by the end
of the decade will be about $4 billion a year -- for the bases already
closed, not counting the ones that are being considered in the '95 base
closings. That's the good news about base closings. The bad news is,
it's costing us money this year and it costs money next year. So in
the '96 budget, we have a cost incurred for the '88, '91 and '93 base
closings. There's nothing to do but to bear that cost until we can get
the savings downstream. We are counting on the savings downstream to
help us fund this increase in modernization.
Finally, we'll
have a real budget growth in the out years. Let me show you... First
of all, I'll make the point about the fact that our procurement is down
to basically historical lows. We are only procuring seven ships, 106
aircraft, and, in the tanks, there's not even 100 new tanks. These are
100 upgrades in the tanks. So we are at a low, and that's a low from
which we will be building.
Let me describe,
then, the last point that I made and where we're going to get the resources
for bringing the modernization up. One of them is we will have to have
an increase in the defense budget. Through that increase, we'll bring
this up from its low of this year. Secondly, as I said, we expect more
efficiency through the acquisition reform to allow us to do better both
on unit costs and on life cycle costs.
This, finally,
after all the qualitative discussion, gets down to what the budget will
be. We're projecting a budget of $246 billion for '96, which is a $6
billion decrease over the '95 budget. One qualifying point about all
of these figures here: these are all the budgets for the fiscal year
without anticipating any supplementals. The '95 figure, which is here
by comparison, anticipates the $2.6 billion supplemental will be added
to it. So that's what the asterisk here stands for.
This shows that
we are still in the defense drawdown from a budget point of view this
year, and we're projecting one more year. From that point, the budget
stabilizes. This represents a real change in budgets. Then, in the last
two years of the future years defense program, it actually increases.
What happens in
the out years relative to modernization is we not only get the benefit
of this increase for modernization, but this is also the time by which
the savings from our base closings cut in and we start to gain that
investment.
There's one other
benefit that we get of shifting resources over to modernization. The
defense drawdown of personnel is costing us money too, because we have
certain expenses associated with retirement of people from the active
duty forces, and those expenses will not be sustained in these out year
periods.
This is a chart
you've seen before, and it just shows the defense budget as a percent
of the federal budget. It shows that during the Korean War it was 57
percent; during the Vietnam War, 43 percent; during the peak of the
Reagan buildup it was 27 percent. This year, FY96, we're projecting
it to be 15.5 percent. In the five-year plan -- the future years defense
plan I showed you -- it goes as low as 13 percent of the federal budget.
This is the same
as a percentage of gross domestic product. The key figure here in FY96
is 3.4 percent of the budget -- compared to the Reagan buildup era of
6.3 percent and even higher figures during the two war periods.
This is just the
bottom line.
This may sound
like motherhood: DoD funded: readiness is the highest priority; people
come first. It is not. We based the budget on that. We acted on that
judgment, and it profoundly affected the allocation of resources in
this budget, and it is working. It is, we believe, the right force structure,
and we believe it is the right strategy. I've described to you the recapitalization...
We have a reprieve in recapitalization, but we have to have an increase
in the out years and this budget does plan for that.
With that, I'll
be happy to take your questions and comments.
Secretary Perry:
John pointed out to me that one of our charts had a typo. I used the
right word when I talked to you but the chart was wrong. It said "restores
nuclear deterrence." The word I used was "retains." "Retains" is the
right word. (Laughter)
Q: As you know,
many Republicans in Congress are asking for higher defense spending,
and you yourself in your comments cited what you call uncertainty and
confusion, one assumes over everything from whether inflation will change
to whether Iran will get nuclear weapons. With defense so close to the
bone, what gives you the greatest cause for concern about the defense
budget?
A: First of all,
Charlie, I have very high confidence that this budget does maintain
high readiness. I said that many times in this briefing, and I truly
believe it. I am not concerned on that point. I think that is a false
argument, and I would hope to, with the Congress, get that argument
off the table and get down to discussing other issues which are more
important. I think anybody can raise a concern as to whether we will
be able to fund this modernization program in the out years. That depends
on three things happening.
It depends on the
out year funding being achieved. We have an increase in out-year funding.
That has to be achieved. It's just projected at this stage. It depends
on the savings from the base closings being achieved. We have $4 billion
a year which we are projecting, which we are planning to divert into
modernization from the savings from the base closings. And it also projects
that we will have success in our acquisition reform. Those, I think,
are all reasonable projections, but it's also reasonable for people
to question whether they will happen as soon as we forecast, or to the
extent that we forecast. I think those are reasonable debating points
for anybody to have.
Q: You've emphasized
several times, and just now answering Charlie, the importance of savings
in base closures, but you've also announced your slowing down the base
closure program for the next round. You haven't announced any plans
to ask for another round of BRAC. There seems to be a contradiction
in the middle of your strategy. Why?
A: There's no contradiction.
I said that we were projecting $4 billion a year savings from base closings.
That $4 billion a year is on the '88, '91, and '93. It makes no assumptions
about any closings in 1995. We will be submitting our base closing,
and there will be a substantial number of bases closed. What I announced
in a talk, a week or two ago, is that that list will not be as large
as the '93. It will still be a significant list, it will still be painful.
There still will be savings. None of those savings will be available
to us in the period of this defense program. It will be mostly costs
associated. I don't have the exact figures in my head, but over the
period of the future years defense program, the '95 base closing will
probably net out to about a net wash. It will cost in the early years,
and savings only coming in the tail end. So there's nothing in the '95
base closings that will affect either negatively or positively this
over the whole period. It will be a negative effect in the first few
years.
Q: Do you want
to ask for authority for another round of BRAC after '95?
A: I would like
to have authority for another round of BRAC after '95. I'm not optimistic
that I will get that authority.
Q: What, if any
changes did you make in this budget in anticipation that Republicans
in Congress may have different plans for the budget?
A: We considered
that very carefully. The answer to your question, though, is we did
not change it. What we decided, instead, was that we obviously have
a very challenging job of presenting our rationale or reasons for this.
What I have covered with you today will be the foundation, the basis
of our rationale to the Congress. We'll obviously have to go into much
more detail and cover some of the issues they're concerned about. I
hope, first of all, to be able to convince them that the readiness is
high and this budget funds it. That will take one of the arguments off
the table.
We will have a
substantial discussion, I believe, on what some of them are calling
non-defense programs. I will be presenting to them that among these
things they call non-defense programs, the bulk of those are programs
which are very important to our defense and I call defense programs.
So I will have the challenge of trying to defend the value and importance
of these programs to our defense.
Another increment
of them that are truly non-defense programs, are generally programs
that have been added to the budget by the Congress. They're not ones
we submit. There's nothing in this... We have about a billion dollars
of programs in '95 that we're doing that I would call non-defense. They're
good programs, they're important programs, but they're not defense.
They more appropriately, perhaps, should be in other budgets than ours.
But in the '96 budget, none of those programs are there.
So I'm prepared
to defend programs like the Nunn/Lugar, this comprehensive threat
reduction program which I believe is vital to our defense. I'm prepared
to defend the technology reinvestment program which I think is vital
to our defense. It probably would have been politically easier to take
some of those programs off and avoid the argument. We considered that,
but we decided to stick with our guns, because we think we're right.
Q: You cited the
problems caused by the lack of emergency supplementals and how you plan
to deal with that in the future, particularly what you call the readiness
preservation authority. But many Republicans in Congress feel the problem
is not the supplemental funding, but too many missions. Can you state
the case, or how are you going to make the case that this preservation
authority is not simply a slush fund for missions of questionable national
interest, as many Republicans seem to view it?
A: We will have
to, obviously, make that case to the Congress that it is not a slush
fund, and I believe we will be quite capable of doing it. The program
as we will be proposing it to them fully protects the constitutional
prerogatives of the Congress, as well as the constitutional prerogatives
of the President. It is only an emergency fund to be used in the last
quarter or two of the year, and it is only to be used on certain contingency
items. And we have to come in, the program requires us to come to the
Congress for a supplemental, it just gives more time for us to get the
supplemental, and it allows us to draw on other accounts until such
time as that supplemental gets approved.
Q: How confident
are you that the technology reinvestment program will survive this year?
A: I'm basically
an optimist, and I think I'm right. So I will go in and make a strong
case. I would point out that I think there has been misunderstanding
about the program, some thought that this is some kind of a relief program
for industry. It is not. It is a program which funds very high priority,
very high quality technology of value to defense. It happens to also
be of value in non-defense programs. It's dual use. But that should
not prejudice its use in terms of defense programs.
I think it may
be confused with some of the so-called earmarked programs which are
earmarked for constituency interests. All of these TRP programs are
competitive programs. We don't select any of them that aren't competitive,
so there's a rigorous competition that goes on before these are selected.
Also, all of them are 50 percent funded by industry. So it's not a grant
program for industry -- they're putting up half the funding. So this
program, from my point of view, is a good deal for the Defense Department,
and I will defend it very enthusiastically to Congress, and I hope and
I believe that I will prevail in that defense.
Q: Mr. Secretary,
you mentioned that you hoped that the supplemental request and the new
authority will prevent the problems with O&M money being diverted
to pay for operations late in the year. But in the last several years,
individual commanders in the field have diverted money from those budgets
and the base operations because those accounts weren't fully funded.
What can you do to prevent that from happening, and from letting those
individual units, as they did in Europe, run down?
A: Two things.
First of all, and most importantly, be sure that the budget reflects
the funding to do the programs they think they need to do. The reason
they diverted funding was because they didn't have enough budget to
begin with. Sometimes that was because there wasn't enough budgeted.
Sometimes it was because it was diverted. So if we can do these two
things, full funding in the first place and prevent diversion, then
there will be no incentive for the commanders in the field to divert
the funds that way. To anticipate your question a little bit, I do not
anticipate setting up a rigorous program to check on them or to reduce
their authority. I think in general their judgment will be very good
on how they use these monies and I'd like to leave them in the position
to exercise that judgment.
Q: You're providing
the maximum allowed by law in terms of pay raises, but as I understand
it, that's still less than the rise in the cost of living.
A: It is.
Q: In a budget
that puts people first, did you consider trying to get the ceiling raised?
A: Yes, we considered
it and rejected it for this budget submission. The difference, by the
way, is one-half a percent. The law allows us to budget for inflation
minus one-half percent. The law is set up to put a little bit of a dampening
factor in inflation.
As a consequence
of the cumulative effect of that law, the military pay has fallen farther
and farther behind comparable civilian pay. Therefore, what we considered
instead of approaching that law was we considered the possibility...
Well, we have something called a quadrennial compensation review. It
happens it's coming up this year. What it does is look at this whole
comparability issue. We will get from them recommendations as to the
extent to which they think it is not sufficiently comparable, and whether
we should make one-time adjustments in it. The adjustments will not
necessarily be in pay if they recommend it. It might be in benefits
instead of in pay. They'll be looking at the whole package. So we simply
deferred any action until we get the recommendations from that quadrennial
group. But the actions will not necessarily be pay actions. They would
be overall compensation related.
Q: Mr. Secretary,
with the U.S. Army predominantly CONUS based in America, and with the
difficulty of moving divisions overseas as quickly as you'd like to
because of strategic lift questions now, do you really need all those
National Guard brigades?
A: Yes. The National
Guard brigades, particularly the 15 high readiness brigades, are a key
part of all of our war plans. Every time that I review in some detail
the war plan for Korea or the war plan for two MRCs, we see the Guards
playing an intimate role in it, involving hundreds of thousands of Guards
being called up in all of this war planning that we have. Of particular
importance are these 15 high readiness brigades. They are going to be
called up early on, and most of the contingencies we're looking at,
the peak need for personnel is in the early months, rather than the
later months.
In addition to
that, we are developing more and more ways of using the Guard to relieve
the too high personnel tempo in some of our deployed units. When I was
in Germany I talked with many of the units over there, and selected
units are simply being deployed at much higher rates than is appropriate
for good personnel policy. And we're starting to experiment now with
bringing Guard units over to take over, to relieve them of some of that
burden. This is a double win. It not only relieves the active duty unit
of too high an operating tempo, but it's also excellent training for
the Guards, much better than the simulated missions they would have
gone on in the Guard training.
I have a very,
very high regard for the effectiveness of our Guard units and we're
making more and more use of them in our planning. The total force involves
both of them.
Q: I'm wondering
what you consider more likely and worrisome over the near term or the
next several years. First, either that the GOP and Congress will force
upon you increases which you do not feel are necessary in your bottom
line; or that balanced budgets, taxes and other pressures will force
drastic reductions in the defense budget?
A: I do not believe
I will have the problem of having money forced on the Defense Department
beyond what I've asked for. I know that's an expectation on the part
of some people. I have never believed that was going to be a problem.
All of the events since the Congress has started meeting now have convinced
me that that judgment is right. I do not expect to have that problem.
If the balanced
budget amendment becomes law, I do expect to have the problem of the
iron logic of that amendment forcing the reduction in defense spending,
and that that logic will dictate what the defense spending will be,
rather than an objective consideration of national security needs.
I have made that
point to the Congress, I've testified on that a number of times. But
all one has to do is go through the calculation and the arithmetic of
the levels of reduction in government spending that was required, and
contemplate how much of the discretionary government spending is defense,
to realize that this has to be a very substantial input in defense.
I am very concerned about that.
Q: How about more
B-2s? Any chance? (Laughter)
A: Thank you.
-END-
