Defense Strategic Guidance Media Roundtable at the Pentagon

 Note: This event followed a Defense Strategic Guidance Briefing presented by President Obama, Defense Secretary Panetta, and Chairman of the Joint Chiefs of Staff General Dempsey. 

                DOUG WILSON, ASSISTANT SECRETARY OF DEFENSE FOR PUBLIC AFFAIRS:  As you know, there are our Defense officials here who are going to be speaking.  This is on the record and attributable to Deputy Secretary of Defense Ash Carter; and he is flanked by the Vice Chairman of the Joint Chiefs of Staff, Admiral James Winnefeld, and the Undersecretary of Defense for Policy, Michèle Flournoy.  

                And Deputy Secretary Carter will begin, and he will field questions.  

                DEPUTY SECRETARY OF DEFENSE ASHTON CARTER:  Good afternoon.  Is this mic on?  It is.  Excellent.  Well, we're here to answer your questions.  And let me start things off just by anticipating a question I'm sure you're going to ask, which is:  What's new here? And let me just touch on the main points.  

                What's new in the circumstances that led to this strategic guidance is, as the secretary said, as the president said, as the chairman said, the pivotal moment we find ourselves in, where we would need to take a thorough and careful look at our defense even if we didn't have a budget crunch.  And then, of course, we do have a budget crunch, which is another, second reason for the review that has been -- that has led to this strategic guidance.  

                What's new in the strategic guidance is the clear priorities it sets for us as we finalize the budget.  Quite simply, the strategic guidance was the compass by which we steered the budget review leading to the president's budget for fiscal year '13 and the years thereafter that'll be released in a few weeks after final decisions have been made.  

                What's new specifically in the strategic guidance is, first, to rebalance our force structure and investments towards the Asia-Pacific area, where there are several potential challenges to stability, and to the Middle East, where challenges persist, and towards advanced capabilities to maintain access and power projection which are relevant globally.  

                Second:  to take a different approach to force size and structure.  Obviously, our forces will be somewhat smaller under a smaller budget, but what's important is their shape -- a different shape.  And the guidance tells us two additional ways to change that shape.  For one thing, we will not retain force structure in the ground forces for large and prolonged stability operations such of -- such as have been required in Iraq and Afghanistan.  This does not mean abandoning COIN [counter insurgency operations] or any such thing, but we do not see the U.S. conducting such operations on its own as likely in the future.  And in any event, we will preserve the know-how and capability to regenerate forces if such a need does arise.  

                Wherever we can, we are making provision for such reversibility, as we call it, or readjustment in our plans, since, as Chairman Dempsey said, we're at the beginning of what may be a many -- which will be a many-year transition in an uncertain world.  

                Next, while our forces will still be capable of prevailing in more than one conflict at the same time -- and I want to make clear that this is not changing -- we are continuing to evolve our approach to this capability, since the nature of those conflicts has changed, since we will be able to apply to them advanced and agile new kinds of forces, and since in some cases we can best meet our objectives and deny the aggressors' objectives in ways other than by land invasion and occupation.  

                And third, while obviously many parts of our budget will have to suffer deep cuts, this guidance tells us to preserve investment, and even in some cases to increase our capabilities in key areas that are clearly important to the future -- special forces in counterterrorism, countering weapons of mass destruction, building partner capacity, cyber, and aspects of our science and technology investments -- making sure that we don't simply revert to yesterday's pre-9/11 force structure under the pressure of budget cuts.  

                And importantly, I'd like to add that this includes critical investments in wounded warrior care and other aspects of taking care of our troops who are the heart of our whole defense.  

                So that's a recap of the main points of the guidance.  And now, to your questions.  And what I'll do is recognize questioners.  

                Q:  I'd like to start with what you were just talking about with COIN.  The U.S. didn't choose either of the two counterinsurgency battles it just had in Afghanistan or Iraq; it found itself in situations where those tactics were needed.  Why is what you're proposing now different from what the military did after Vietnam, where it pushed a lot of COIN sort of resources to the reserves and focused on, you know, major combat operations?  I mean, it seems -- why are you -- it seems like the military is turning its back on these skills to a certain degree.  How can you be sure that you're not going to need them?  

                DR. CARTER:  No, it's different in two respects.  The first is that we're being careful to preserve the know-how and some of the specialized capabilities that have proven so useful and that we have learned so much about over the last 10 years.  We are not retaining the large force structure necessary to sustain long, large-scale stability operations.  And that doesn't mean that we can't regenerate them if we need them in time to conduct such operations if in the future that becomes necessary.  

                It's about forces in being, and we do not need to keep forces in being of that kind on the scale in which we've used them over the last two decades.  

                So we're doing to keep the trade craft, and we're going to keep the option to reconstitute, but we're not going to keep the large force structure in being.  

                Q:  Thanks.  I wonder if you'd clarify something the president said about the top line.  I think I heard him correctly in saying that the budget numbers may actually go up.  Is that correct?  And if so, is that adjusted for inflation?  Is it for the number we'll see?  And I assume it's the top line on the base budget.  And I have a follow- up, if I --  

                DR. CARTER:  That's the -- at the top line on the base budget, yeah.  

                Q:  Real or for -- inflation-adjusted numbers?  

                DR. CARTER:  In nominal dollars.  

                Q:  Great, so if spending is actually going up, I think it's a fair question to ask why is it that the 450-plus [billion dollar] cuts now on the table are as far as you think you can go?  The secretary said anything above that could be disastrous.  It sounds like the defense budget is going up.  

                DR. CARTER:  Four hundred and eighty-nine billion dollars is the amount -- almost half a trillion dollars is the amount that we are going to need to take out of our plans over the next 10 years, about 263 [billion dollars] of that out of the next five years.  And that is -- you've just been talking about the base budget.  That is on top of a reduction in the overseas contingency operation spending.  You put those two things together, and you have over the next four years a reduction in total defense spending as rapid as any we experienced after Vietnam or after the Cold War.  

                Now, that's natural because these wars are coming to an end and so forth.  But that's what creates the pivotal moment that was the reason for carrying out the strategic review that we did.  Four hundred eighty-nine billion dollars is a lot of money.  And you'll see in two and a half weeks when we described (sic) our -- the budget plans that we've had to make with that reality how significant that those changes in plans are.  

                And we couldn't do that responsively without the kind of guidance that we got from the president and the secretary and the chairman.  

                Right.  

                Q:  Secretary Carter, on -- just to sort of follow on that line of questioning, do you think that what you've prepared now in the strategic review and the budget that comes behind it will be enough to convince Congress to act to avoid the sequester -- the sequestration option that is sort of hanging like a sword of Damocles over --   

                DR. CARTER:  My view -- and I'm going to ask Michèle to comment on this also, but my view is that when members of Congress, when you, when citizens see the magnitude of that task that we've had to undertake to meet the $487 billion target, you'll understand why we give the harsh warnings we do about sequestration.  We're going very, very far with $489 billion.  As the secretary said, we're looking at things that we haven't had to look at in this department for a decade. He's made us put everything on the table and undergo a very thorough process.  We've had -- we've undergone the strategy exercise first, so we wouldn't make our budget changes without having a strategy behind them, the strategic insight behind them.  

                So I think when you see what $489 million is, people are going to easily understand why sequester would be so disastrous.    

                Let me just ask Michèle if she has anything to add to that.  

                UNDER SECRETARY OF DEFENSE FOR POLICY MICHèLE FLOURNOY:  No, I would just -- I would just add that the secretary's repeatedly used the phrase "hard but manageable" choices. When we roll out the budget details, you will understand the hard part, because there are a lot of hard choices, both in terms of trade- offs but also in terms of people stepping up to the plate and making tough political decisions to do the right thing for the nation's defense.  

                Every strategy does have risks.  We think that we've managed this in a way that the risks associated with this are acceptable.  But I think there is a point at which if you went too far down the road of further cuts, that statement would no longer be true.  And we would, frankly, have to go back to the drawing board to rethink our strategy anew in order to manage additional -- additional reductions and additional risk.  

                DR. CARTER:  Admiral Winnefeld.  

                VICE CHAIRMAN OF THE JOINT CHIEFS OF STAFF ADMIRAL JAMES WINNEFELD:  If I could add one thing, and I think one thing that's very important to point it, and it's the reason why we're doing this the way we are today, and that is, this was all driven by strategy.  Sometimes the behavior of the department when it's had to tighten its belt a little bit has been to simply hand out proportional cuts, look and see what the services come back with, and then try to build a strategy out of the ashes.    

                In this case -- if you pardon the pun -- in this case we've chosen deliberately to assess the geopolitical environment, what kind of technical change is out there, how is warfare changing in the 21st century, and the fiscal environment we're in, which is clearly changing.  And we've crafted a strategy that now can guide our budget decisions, and that's what you'll see in three weeks.  And that is a terribly important cultural change for the department.  

                Q:  Dr. Carter, can you talk a little bit about where the F-35, the Pentagon's most expensive weapons program, fits in the strategy? And if strategy drives the budget, does this strategy justify keeping the quantities, the 2,500-plus quantities of aircraft?    

                And for Ms. Flournoy a separate question.  In the Pacific, do you envision setting up -- does the Pentagon envision setting up a phased adaptive approach for missile defense comparable what it has set up in the Middle East over the next couple -- over the last couple years? Sir?  

                DR. CARTER:  Tony, I'm going to save the answer on the Joint Strike Fighter for a couple of weeks.  I'll just give you a general answer about strategic --  

                Q:  Do you think it's worth it?  

                DR. CARTER:  Well, strategically, as we said many times about the Joint Strike Fighter, it is our fifth-generation fighter.  We want it. We want it to succeed.  That's why we're working so intensively on it managerially.  

                But you know, as you ask about any particular program or any particular activity, I'd take you back to the point that Sandy Winnefeld just made.  What the strategy has told us is areas where we don't want to cut, where we want to preserve capability and where, in fact, we even want to increase capability, like cyber, because we don't want to just give everything a haircut.  That means some other areas that are not emphasized in the priority, in the strategy, are going to have to take more than their share of these cuts.  So the things that are part of the future take less than their share of the cuts.  That's why having the strategy has been so valuable to us as we've made the cuts, because we haven't wanted to go right across the board.  

                Q:  OK, fair enough.  

                MS. FLOURNOY:  You know, as the -- as the president's announcements in Australia made clear, we continue to evolve our presence and posture in the Asia-Pacific region both to deal with challenges that are emerging and opportunities.  We already have very robust cooperation on ballistic missile defense development with our Japanese partners.  They're partners in research and development of systems with us.  And we continue to discuss ballistic missile defense with our various partners and allies there.  

                I think this is an evolving conversation.  There is -- I don't think there's a concrete set of plans that define an end point at this point, but we -- it is a matter of discussion with our allies, and we will continue to work with them on these issues.  

                Q:  Dr. Carter, I'd like to ask you about the nuclear arsenal. The strategy document says that it's impossible that our deterrence goals can be achieved with a smaller nuclear force.  Could you elaborate on that?  And is it still an open whether the department wants to preserve all legs of the nuclear triad?  

                DR. CARTER:  Surely you can.  I'm going to ask Michèle to elaborate on that.  

                MS. FLOURNOY:  So I mean, I think the strategy is very clear, that we will continue to field a safe and secure and effective deterrent, but -- and that we will continue to modernize and recapitalize as necessary.  I do think it's that -- our judgment than we -- that we can maintain deterrence at lower levels of forces, but I will defer any discussion of specific programmatic details to the budget when it rolls out.  

                Q:  The budget -- so we can expect to hear more on that when the budget rolls out?  

                MS. FLOURNOY:  Yes.  

                Q:  Thank you, Secretary Carter.  I'd like to ask a follow-up to an earlier question about COIN.  And then I've got another question as well.  But specific to the COIN insurgency forces, is that just relative to the ground forces?  You built small fleets of minor air forces to do the ISR [intelligence, surveillance and reconnaissance] that have helped out COIN.  Do we expect to keep those, to retire those, sell them off?  

                DR. CARTER:  Many of those -- good question, and yes, the remarks as I made them were mostly oriented towards ground forces.  And you're right that there are lots of capabilities that were developed over the course of the last decade that reflect modern technology and modern warfare, not just COIN warfare, that we want to make part of our -- of the future.  So when I talked about us -- we're not going to keep the large structure in being, but the critical skills, the critical enablers, the novel things that war over the last decade has taught us we do want to keep and include in our force structure.  

                And you'll see examples of that in a couple of weeks, very deliberate ones in which we're building in some of the things that you see in -- you saw in Iraq, you're seeing in Afghanistan, and describing or designing how they will fit into the force structure in the long run.  

                Let me ask Admiral Winnefeld to add to that.  

                ADM. WINNEFELD:  Yeah, I'll just make a quick point.  We learned an awful lot over the last 10 years in these two fights in Iraq and Afghanistan.  And I think it's sometimes important to tease out the difference between COIN and counterterrorism.  And we're doing an awful lot of counterterrorism work right now using a lot of those tools.  

                One of the interesting things for me has been that we -- a lot of what we've learned in the COIN business transcends the COIN business and is applicable to a lot of the other things that we could find ourselves doing in the world.  And by the same token, a lot of the things that we've built, that we've added to the force technically to -- and it's not just ISR platforms; it's networked approaches to warfare and the like -- are applicable to those other forms as well -- of warfare as well.  

                So we're not going to throw the baby out with the bath water there.  We're going to take the lessons, take the technologies that we've developed over the next 10 years and apply them to the future.  

                Q:  OK, and then my question -- my second question, on reversibility, this concept of reversibility is -- was thrown out there with regard to being able to reverse our position on what our forces might be and also seemed as though it was associated to industrial base.  Can you outline what that --  

                DR. CARTER:  There are couple different dimensions to it.  Reversibility just means that as we make these momentous changes, these $487 billion worth of changes, they are causing us, of necessity, to have to stop certain things, pause certain things, slow down certain things.  And in each case, we want to, to the extent we can do so, preserve the ability to change course.  

                So for example, in the ground forces, as we reduce the ground forces, we'll do that in such a way that we keep the midgrade officers that would be necessary to support a larger force in the future if we decided to reverse course.  Now, we can't afford to do that comprehensively, but we can afford to do some of that.  

                The industrial base -- same thing.  

                As we make program changes, we want to make sure that 10 years, 15 years from now, we still have an industrial base that supports our key weapon systems even if we're not able to buy in those areas at the rates or in the volume that we had planned before we were handed this $487 billion cut.    

                Another example, science and technology and innovation, because that's the seed corn of the future.  We want to make sure we don't eat the seed corn.  So in each of the -- reversibility is the concept that we've used to remind ourselves that we want to act in such a way that we, to the extent we can with a $487 million cut, preserve options for the future.  

                Michèle, do you have anything to add to that?  

                ADM. WINNEFELD:  I'd call our focus on reversibility avoiding departmental hubris, because it's entirely possible -- and Secretary Gates was fond of pointing this out -- that we could get this wrong. And so we're going to remain alert as this progresses.  You know, the chairman referred to, you know, four budget cycles going out to 2020 and the like, and we will be alert to the need to either change course or shift course a little bit as we -- as the world shifts beyond our control in many ways.  But we did have to make very difficult choices with $487 billion of cuts, and we think we've got a pretty good pathway forward that would allow us to change course if we have to.  

                DR. CARTER:  Why don't we take about two more questions.  Sir?  

                Q:  Secretary Panetta mentioned that the department would need to start using some, he said, innovative methods to sustain its presence in Latin America and in Africa.  Does this mean in any way a smaller footprint in either of those places?  And could you elaborate on what those innovative methods are?    

                (Cross talk.)  

                DR. CARTER:  (Inaudible) -- both of you, if you don't mind -- (inaudible) -- have a lot to say on that -- (inaudible) -- chance.  

                MS. FLOURNOY:  The truth is, in the last 10 years we've been so focused in Iraq and Afghanistan there haven't been a lot of forces available in some of these other areas to be available for engagement and so forth.  

                That said, that has forced us to pioneer some fairly innovative approaches:  the use of small teams to, SOF [special operations forces] teams, for example, to go in and do advising and training and build partner capacity on a rotational basis; a very strategic use of senior leader engagements, of exercises, of our foreign military sales, our foreign military assistance and so forth.  

                And I think some of the work that's come out of that -- we are going to continue to apply those insights and those innovative approaches to ensure that even as we put an emphasis on Asia and the Middle East, we're not abandoning every other region of the world.  We are a global power with global interests.  We're going to stay engaged.  We're going to keep investing in those relationships.  We're going to keep investing in building the partner capacity in those nations.  But we're going to do it in creative and different ways.  

                ADM. WINNEFELD:  Yeah, and I would -- I would build on what Ms. Flournoy said in that, you know, we've invested an awful lot in our special operations forces over the last decade, and they've been doing remarkable work.  And a lot -- the lion's share of what they've been doing has in fact been contributing to the COIN fight, the high-end elements of the COIN fight, and they're very, very adept at that.  

                But these are very agile and flexible forces, small units, as Michèle pointed out, that are also very good at working with partners. And these -- as the -- as the wars start to draw down -- Iraq is down, Afghanistan coming down -- we're going to retain those forces and leverage them into other missions, to include the types of things that you asked about.  That could include working with partner nations in other continents.  

                I would also point out another example of the innovation in -- there's this little program called the State Partnership Program that the National Guard has.  It's a very high-leverage program where individual states will partner with another nation in Europe or Africa or Asia or where -- what have you, and it's proven to be a very, very valuable high-leverage tool for us.  And so we plan to build on things like that to help us on these innovative approaches to other parts of the world.  

                DR. CARTER:  Chris, last question.  

                Q:  Dr. Secretary, to what extent do you end up killing any major acquisition programs, without getting into all the details?  Did you -- did you have to do that?  

                DR. CARTER:  Oh, we have had to make major changes in every category of the budget in order to meet this $487 billion target. That includes modernization.  And I think, as Admiral Winnefeld was saying earlier, what we get from having this strategy that we -- the president and the secretary and the -- and the chairman have given us is the ability to -- we are obviously going to have less modernization than if we had $487 billion more.    

                But we're -- we get -- we figure out where to focus that to best strategic effect.  That's the value of having this document.  And so I think you'll see that where we invest and how intensively we invest will -- is shaped by this.  And it just gets back to the old -- the same point Sandy made earlier, which is this is not going to -- a haircut.  We are trying to change the shape and not just the size of each and every piece of our budget activity.  

                And with that, let me thank you all for being here.