SECRETARY OF DEFENSE CHUCK HAGEL:  Thank you.

 

(Applause.)

 

It's pretty damn good when you get that many sergeant majors to stand up for a buck sergeant.

 

(Laughter.)

 

But, you know, you trained me.  So I want to first thank you.  Thank you for an opportunity this morning to say hello and take a few minutes to share some thoughts about what you're doing and what we're all doing, the future of our country.  How important your leadership has been, how important your leadership is going to be.

 

First, I want to thank Sergeant Major Defreese for the introduction and for his guiding hand of this institution, which is important an institution in our military establishment as any one institution.

 

You all know well that the enlisted corps of our military is often referenced as the backbone.  It's a lot of appendages, it's a lot of pieces.  But without that enlisted corps, without the sophistication and the commitment, and the discipline and the focus, and I not intentionally leave out humanity, but the humanity of it is important as well, and I want to address that part of your responsibilities here in a moment.

 

But to be in this institution at this time is a great privilege for me.

 

I want to also thank General Twitty for his leadership.  I know the general's very comfortable with all these sergeant majors here in the room.  And I appreciate you giving him a visa to come -- (Laughter.) -- and sit in with you.

 

So, thank you, general, for what you continue to do for our country in your important leadership.

 

Congressman O'Rourke, thank you very much for what you do and your commitment to these tremendous men and women and their families who serve this country.

 

I know we have representatives here from Senators Heinrich's office and Udall's office, so thank you as well for what you do.

 

And the mayor of El Paso, Mayor Leeser, thank you.  We are grateful for your leadership.

 

And I know Mr. Dayoub is here from the Chamber of Commerce.  Thank you for what you do to continue to enhance this community and also look out for our men and women who are assigned here.

 

I recall my days here well.  And I think all of you who have served here in any capacity at any time recall that as you go into the summer, in the desert, it's -- and especially basis training -- a very enriching experience.

 

(Laughter.)

 

I might say enlightening.  When you are referenced not by your name, but by other superlatives in those days -- I know we don't do that anymore, but drill sergeants in 1967 were not as humane as I know all of you are.

 

(Laughter.)

 

And it's -- it's enlightening and enhancing and educational when you are often asked how dumb are you? How could you be so stupid?

 

(Laughter.)

 

And that's a hard one to answer, actually, when you try to --(Laughter) -- work your way through that.

 

But the experience I had here in basic training, and my brother Tom was four weeks behind me, really was a defining time.  And the rest of my service in the Army did very much define me.  And I don't know anyone who -- who isn't defined by service in uniform.

 

It's not the only service, and you all know that and appreciate that.  There are many ways to serve this country, and thank goodness we have many people who do serve in many different capacities.

 

But serving your country in uniform is a pretty special endeavor, and it's a particularly special commitment.  And a couple of things I wanted to share this morning with you, mainly based on what I have learned as a result of my time associated with our military and their leaders, men and women who serve this country, that began, as I said, 48 years ago, right here, when I arrived by train at 6 o'clock in the morning in late April of 1967.

 

And then the things that have happened to me in the last 48 years and the opportunities I've had to serve in different capacities, really did begin here, as I worked through different courses and then ultimately in Vietnam in 1968 for a year and then was out of the Army.

 

But I've never been too far from the Army.  Never been far from veterans.  And always have been able, the last 40 years, to be fortunate enough to be connected in some way to our service men and women and their families and -- and veterans.  And that has given me dimensions of personal satisfaction and gratification that I have never known in any other -- any other way.

 

This institution, this academy, as I noted, and you all know, represents so much of who we are.  In fact, it's the entire enterprise of the defense enterprise, and each service has its own, I know, chiefs and sergeant majors academy, as it should be.

 

But embodied here is a special spirit.  And leadership is one of those great things that you can write volume and volumes about, what do you learn at leadership institutions and how do you become a sergeant major, a command sergeant major, how you become a general.  

 

You can't really teach that.  You know that.

 

And I've always thought that as the volumes and volumes and hundreds of thousands of documents, essays and books and interviews, millions, over the years, have been written and spoken about leadership, it really comes down to a couple of things, in my opinion.

 

One is responsibility.  And two is judgment.

 

Now, you -- you have to have knowledge.  You have to be aware.  You have to know what you're doing.  That's a pretty foundational component of anything.  But in the end, what you're called upon to do ultimately,
in these critically important positions, is to exercise responsibility and good judgment.

 

You can't teach that.  That's at least my opinion after 48 years of doing a lot of things.  It's an accumulation of experiences, of knowledge, of commitment, of what you want to do, starting with who you are and what you believe, and your willingness to commit yourself to those standards that you set, first, for yourself and then the institution sets standards for you.

 

And if you're willing to comply and attempt at fulfilling those high standards, first for yourself and then, second, for the institution, and then you'll have something to offer others.  You'll have something to say.

 

And that's really the beginning of responsibility.  And then that develops into judgment.  So many -- so many line calls, all the time.  And you can't go to a textbook, you can't go to a former instructor -- you can ask for advice, but in the end, it's your responsibility to make the call, to make the judgment.  And that is an accumulation of many, many things.

 

Those are the two essentials, in my opinion, that define leadership.  That's particularly important, I believe, today, at the beginning of 2015, because we are living at a very defining time in the world.

 

Every day is different, every year is different, every day defines something.  Yesterday is gone, we can't do anything about yesterday.  We can't do a hell of a lot about today, actually.  We can do something about tomorrow.

 

And how we define tomorrow, how we define our institutions, how do we define everything that we know is right and we believe in, and how do we prepare our institutions and the next class and the next class and the next group of sergeants majors, those who will have responsibilities that will come after you, how you prepare them, that also is part of responsibility.  And that also feeds into judgment, because that, ultimately, is one of the greatest responsibilities of leadership is preparing an institution for the future.

 

We have been trying to do that the last couple of years in Washington, since I have been secretary of defense, not only in the technological edge of assuring that our technical capabilities do not erode as we have had to deal with severe budget issues over the last couple of years, which you all have been part of and had to maneuver and engage and navigate, and you've done it incredibly well, but also other demands and factors and defining dynamics in a world that is now partly intimidated by the -- by the immediacy of everything.  The immediacy of judgments.  The immediacy of we want an answer now.

 

And there's where judgment especially comes into play.  I have believed, and as I worked my way along the last 48 years in different jobs, that especially today, but I think it's probably been true through history, that sometimes there are not immediate answers to problems.

 

We Americans contest that, we fight that:  Well, of course there's an answer to the problem.  We'll fix it.  Let's go to war.  Let's commit troops.  Or let's present a policy to address that problem.  There's an answer to it.

 

Many times, we find that the problem, the challenge, the issue, can only be solved through an evolving process of solutions, ultimately getting to the high ground of resolution.

 

That's -- that's the kind of world we're living in.

 

Look at the Middle East today.  The Middle East is captive to being now in the grips of historical differences, tribal, religious, ethnic.  That's not the only challenge and that's not the only force that's driving Islamic fundamentalism and terrorism in these -- these ideologies that have nothing to do with religion --that are brutal, murderous, irresponsible.

 

That's not religion.  But yet, the divisions and the lines of those divisions as to how they started and how they perpetuate, much rooted in religious or ethnic differences.

 

There's not one answer to that.  I think there are evolving solutions, which we are helping play a role in that, but we can't fix that.  The United States of America can't fix that problem.  No country outside that region can fix that problem.  It will be the people themselves who will ultimately have to come to some resolution through a process of evolving solutions to fix it.

 

The world will be presented more and more with those kinds of issues, where responsible leadership will always end up having to rely on responsible judgment, and how do we deal with these problems?

 

We are the one nation on Earth that has commitments not only to our own security, as every nation's first priority is its own security, but we have obligations, responsibilities to treaty partners, to institutions around the world.  Certainly, it is in our interest.

 

But that's a burden -- that's a heavy burden to carry, and I have noted before -- when I was in the Senate, I talked about this issue -- that this is an issue that the American people are going to have to deal with on -- on the basis of how much burden they want to carry, why it's important, if it's important.

 

And I have come to conclusion that as unfair as some of this is to the United States, because we carry the burden, we pay the highest price, we could have a different world.  That's right.  But when you think of it in terms of your children and your grandchildren, do they want a world where America is weaker and the next great powers will not be near as judicious and responsible with its power as America has been with her power.

 

That does not at all escape the reality that America has made mistakes.  Every nation makes mistakes.  Individuals make mistakes.  But we have blundered when we have tried to force issues and tried to force answers on other people with the virtue, always, of trying to help -- we can help you, we can fix the problem.

 

So that's my point about not every problem has an immediate answer.  We have to be smart about that, especially in this kind of a world that is so hair-triggered, where there's very little margin of error.  There is little time, and we've got to be smart in how we use the time to make the kinds of decisions that will last.

 

Decisions, as we all know, have consequences.  Actions have consequences.  Inaction, doing nothing, has consequences.

 

And that's a tough balance to maintain in a complicated world of seven billion people.  And as I have noted before, demographers say we will be at nine billion in the next 25 years.  And when we think of the new complications that will present to our world, it's especially important now that we have leaders, as I have noted, as we go through this very defining time, because I think we are building a new world order in this defining time.

 

We've not seen disruptions in the world order like we are seeing today since World War II.  World War II, a new world order was built after World War II.  We led that effort.  It's worked pretty well.

 

And we look at the troubled spots in the world today, those are areas that were left behind after World War II.  They did not benefit from human dignity, respect, freedom, opportunities, education, market economies.

 

And consequently, those parts of the world are engaged in intense conflict today.

 

So, at the same time, we should not eliminate or overlook or disregard or underappreciate the good that's come out of that world order after World War II:  no World War III, no nuclear exchange.  Pretty remarkable, quite frankly.  A time of -- of the last 70 years when there has been relatively considerable stability in the world.

 

Now, we've had Vietnam.  We've had crises.  We've had ups and downs.  Absolutely.  But we have always been able -- we being the United States with our partners -- to contain it enough.  Not fix the problems -- some problems have been fixed -- but to contain enough.

 

We are living now at a time coming at the end of that post-World War II world order.  Technology has driven a tremendous amount of that, but it probably started with the implosion of the Soviet Union.

 

When the Soviet Union blew apart finally in 1991, that changed the entire equation of balance of power in geopolitics in the world.  From that moment on, things started to change and shift.  We are now at, I think, that second inflection point since World War II.

 

So what we're doing today, what is coming -- and it isn't going to be just in 2015 or 2014 or 2013, the last two years -- but these next few years will define a world order.

 

That world order I think will be up and down.  It will be inconsistent.  It won't be like what we saw in the '50s and the '60s and the '70s, I don't believe.  That means we have to prepare this institution in ways we have never had to prepare it, and much of that will fall on you in your command positions, as you take your new responsibilities.

 

I want to just mention in closing, because I -- I want to get some questions, in my office in Washington, hanging behind my desk -- and I have asked the last six secretaries of defense if those pictures, those paintings were there when they were there, and they were -- paintings of two individuals:  Dwight Eisenhower and George Marshall.

 

I think through seven secretaries of defense, no one has dared touch those paintings.  Lightning would strike if -- if we did.

 

But it reminds me everyday of the kind of insightful, responsible leadership and judgment that this country was fortunate enough to have after World War II.  It helped shape this new world order, those -- those two individuals.

 

There were many others, of course, and many others came from this institution, our military enterprise.  But those two in particular had a tremendous, tremendous reach into the future and could see what kind of institution we were going to need and what kind of people -- because people run it all.

 

I mean, we can have the technological edge and the partner capabilities that we're building, have been building, innovations and initiatives that I started in the last two years, and reviews of our nuclear enterprise, our military health care system reviews.  All those things need to constantly be reviewed and processed and updated.

 

And I'm very proud of the -- the work that we've done over the last two years in order to do that, put some of these things back on track, move in the right direction and change many of the things that needed change.

 

But these two individuals really were, I think, the -- the anchors for this country the last 70 years as we refer back to them.  Curriculum at West Point, here, curriculum everywhere refer back to Marshall and Eisenhower.

 

Now, I want to just read you very, very briefly a quote.  I know you have heard this, but -- but it's a quote from Eisenhower that I had hanging in my office in Washington when I was in the United States Senate for 12 years.

 

And it comes back and really ties my opinion together, the points that I've made here in the last few minutes about responsibility, that -- that the essence of leadership is responsibility and judgment.

 

And this is a quote -- and you all know -- which was never used -- thank goodness -- handwritten note that Dwight Eisenhower had written and put in his pocket in the event of a failure at Normandy.  I know you have all heard it.  It's probably taught in all of our military classrooms.

 

But he wrote this note, put it in his pocket, and was prepared to release it in the event that the landings in Normandy had failed.  And this is a quote.  "Our landings have failed.  And I have withdrawn the troops.  My decision to attack at this time and place was based upon the best information available.  The troops, the Air and the Navy did all that bravery and devotion to duty could do.  If any blame or any fault attaches to this effort, it is mine alone."

 

Now, that's -- that's responsible leadership.  And I think what Eisenhower did and said and was prepared to release immediately, if Normandy had failed, is a guiding principle of leadership for all of us in every institution and in our lives.  Responsibility and judgment.  And in both cases, Eisenhower did exactly what great leaders do.  And I know you all value responsible leadership and judgment.  And you have seen it. You know the difference.

 

You all started, I suspect, as E-1s.  And when you start, as General Twitty started as an O-1.  And when you start at those levels, as you should -- because you're not worthy of command unless you understand every step of the way and you've lived every step of the way -- then you start to appreciate, as you develop leaders, and you see leaders, you know leaders -- you know why you respect them, and you know how you want to emulate the good ones, and even the great ones -- and you have been role models to a lot of people.  And you're going to continue to be role models for a lot of people.  That, too, carries a heavy burden.  Maybe as heavy as anything, as being role models to people -- others who will come in behind you and look to you as examples of the kind of leaders that they want to be.

 

Well, I thank you.  I thank you for your service.  I thank you for your commitment to this country.  And I want to thank in particular your families.  I know the sacrifices that families make is very, very significant and difficult. And families deserve a tremendous amount of acknowledgment and recognition and thanks for what they have to endure so that you can do the things that you do that are so important for this country.

 

I'm very proud of you.  I'm very proud to have been part of this institution.  So, I thank you.

 

Sergeant major, I'd be very happy to take some questions -- whatever -- whatever you want to do.

 

Q:  Mr. Secretary, Sergeant Major Lamberson, from the time you started your career here in 1967 until now, how have you not only seen the Army, but the military transform?

 

SEC. HAGEL:  I have always believed -- and I believe it as much today, after two years as secretary of defense, as I did before I got here -- that this institution has been on the cutting edge of social change in this country more than any other institution.  And it is a result, in my opinion -- your question about changing -- is that we have the capacity in this community -- the military community, the military establishment, the military enterprise -- we have the capacity that no other enterprise has.  And we have the environment and the capabilities and the commitment to assure that each individual soldier, airman, Marine, Coast Guardsman, sailor is treated the same, in the sense that you rely on each other -- starting there.  Because if one of you doesn't do your job, then the mission may well fail.  It probably will.  So, the jobs are important.

 

The reliance on -- on each other is important.  There's no other establishment in the world like that.  So, that's where you start as to see change.  And I've seen, the last 48 years, astounding change.  I mean, you go through the social changes in -- in our military that has led the way in the United States.  Things that we're doing now -- sexual assault.  And I'm -- I'm proud of the efforts that you all have made, that we're making to deal with this crime.  It's a crime to start with, but it's worse for the military, I think, because it's a disrespect of each other.  When you rely on someone in combat, or any other phase of your job, you respect -- you may not like the person necessarily.  You don't have to go on vacation with them.  But you rely on them.  You respect them for the job they do.  And why should that change in a social environment?  It shouldn't.  So, we really fail our own people.  We fail each other.

 

We're taking this on, for example -- sexual assault -- far better, far more -- more significant than any other institution in America.  Because partly, we have the capability to do it.  And we are committed to do it.  We are doing it.  And we have the cohesiveness to do it.  Just like everything else the military does.  And gets to your point about how has it changed.

 

I think, too, that has come also as a result, of -- as -- as institutions should -- better trained -- our military today -- better trained than ever before in the history of the world.  Our soldiers are better trained than any soldier on earth today.  And I suspect -- I wasn't around for the last 5,000 years, but I suspect better trained than -- than any army ever in the history of man.

 

They're better led.  They're better educated.  They're better informed.  They're more committed.  They have a technological edge in every way, as they -- they do their jobs, carry out their missions every day.

 

Now, when you combine all that -- I mean, that -- that's a pretty significant and powerful dynamic that has given us, the military, I think, an appropriate recognition by the American people, an appreciation.  It doesn't mean that always lasts.  Nothing ever lasts unless you pay attention to it.

 

Why do you pay -- why do you pull maintenance on your platforms?  Because you can't just run them.  It's the same thing about human beings.  You all need breaks.  Everybody needs breaks.  You got to take care of yourself.  Why do you get checkups?  You'll break.

 

Thirteen years of constant war has broken parts of our force and put tremendous strains, on especially our Army and our Marines. Longest duration of wars this country has ever been in.  We have to pay attention to that.  That's health of the force that I've seen that change.  I've seen more emphasis on health of the force. Taking care of the problems that, 20 years -- maybe even 10 years ago -- we didn't pay as much attention to.

 

I saw it coming out of Vietnam with PTSD.  I was a deputy administrator of the VA.  In fact, I resigned, because I didn't think the administration was doing enough to recognize PTSD and Agent Orange.  All that, I -- I was there '80 -- '81 and '82 at the VA.  Look at where the VA is today, where recognition of these -- these kinds of consequences of war are.

 

So, we've made tremendous progress.  Those are just a couple of the changes that I've seen.

 

Thank you.

 

Q:  Thanks, Mr. Secretary.

 

Q:  G'day, Mr. Secretary.  Darren Murch from the Australian Army.

 

The U.S. is rebalancing to the Pacific will draw on existing alliances, and perhaps requiring new commitments.  A recent article in the Australian Strategic Policy Institute regarding surveillance cooperation between the U.S. and Australia introduced the notion that alliances will be able to fill the gaps that remain in the U.S.'s coverage of the region.  Can you provide your thoughts on these possible gaps, and what you expect of the regional Pacific partners to contribute?

 

SEC. HAGEL:  Thank you.  And thank you for being here.  We're very proud of our partnership and friendship and alliance with the Australians.  I was just in Australia a few months ago.  Matter of fact, I spent my 22nd birthday in Australia on R&R.  (Laughter.)

 

I don't think there are any arrest warrants out still standing, but -- (Laughter) -- I had an R&R from Vietnam and went to Australia.

 

My father was in Australia in World War II, in the Army Air Corps, and all over the South Pacific.

 

Love your country, love your people.  Great allies.  I still correspond with some friends from Australia.

 

Your question is an important one.  First, I have -- in the two years I've served as secretary of defense, been to Asia-Pacific region six times.  I've spent considerable time there to reflect, certainly, the seriousness and the commitment of that rebalance to the Asia Pacific.

 

You think of what we have done over the last two, three, four years, to define that.  Our new Marine relationship in Australia.  The new relationships our rotational assignments and exercises in the Philippines and the new agreements that we have there.  Our LCS assignments and ships in Singapore.

 

Five of our seven treaty obligations are in the Asia Pacific.  We'll continue to build with resources, capabilities, focus, Marines, especially, as we get the Marines back to their expeditionary roots, as we build that back up.

 

That commitment is solid.  It is going to be there for a long time.  It doesn't mean that we are retreating from any other part of the world.  We're not.  I mean, look at what we're doing with our NATO partners, and especially in Eastern Europe as a result of Russia's irresponsible and dangerous behavior.  What we're doing with 60 of our coalition partners, including Australia, in the Middle East.

 

So, we're not going to retreat from any part of the world, but clearly because the United States has been a Pacific power since the beginning of this country, and we have built much of our future around that relationship with that region of the world, as economies expand, as opportunities expand, for all countries. We have a lot of interest and will continue to have a lot of interest.

 

So that -- that's a commitment that President Obama has made.  I think most of the Congress has supported that.  I won't speak for Congressman O'Rourke or the senators' representatives.  They can -- they'll figure that out on their own, as to what they're -- how they want to handle it, but I'm certainly a strong proponent of that rebalance.

 

Q:  Thanks, sir.

 

SEC. HAGEL:  Thank you.

 

Q:  Mr. Secretary, Senior Master Sergeant Sundeen.  You've been committed to reforming our nuclear enterprise.  And the Air Force has taken recent measures to change the culture of the nuclear force.  Do you see those changes improving our nuclear readiness and capabilities?

 

SEC. HAGEL:  I do.  And I think, as I look at my last two years, I think that's one of the most important things that we've done is taken a hard look at that -- that nuclear enterprise.  And we went in hard, and shook the tree hard, as you know, to figure out how do we get this thing back on track.

 

We've let the nuclear enterprise and every component of it drift over the last few years.  For many reasons, but, one, we have been intensely committed to two long land wars.  It has consumed a tremendous amount of our resources, our thinking, our strategy, our time, our leadership.

 

And I think, too, in the world that we live in today, so many people in this generation give very little thought to what about the danger of a nuclear exchange.  And probably North Korea has put that back up on the scope more than any one -- not just one country, but one thing.

 

Two weeks I think after I was sworn in as secretary of defense, February of 2013, the North Koreans lifted off with some very, very dangerous missile launches.  And I recall from the first month of being secretary of defense, I was very much consumed with that, with the White House, what we were going to do, how we were going to handle that, with our allies, the Japanese, the Australians, the South Koreans, in that part of the world.

 

So we've had to pay attention to this.  We are getting back to it.  We're committing more resources.  We're upgrading the structures.  In particular, we're upgrading the promotion potential for our people who are assigned to the nuclear enterprise effort.

 

I was just in Whiteman, at Whiteman Air Force Base in Missouri, in the last three days.  I've been at all the bases in the Midwest, the ground launch bases.  Kings Bay, Georgia, our sea launch.

 

So I've spent a lot of time on this.  And the nuclear deterrent probably has done more than any one thing to deter a world war III.  It's been an accumulation of everything, but that is still an important deterrent, especially as we have nations out there, Iran, where we're trying to, as you know, work through a responsible position for the world community and Iran to have Iran not go forward with any kind of development of a nuclear weapon, the capacity to deliver that weapon.

 

The Russians, the Chinese have that capability now, other nuclear powers.  We don't want to see more powers -- more nuclear powers.  That's for sure.  It's in the interest of the world.

 

So the deterrence of our nuclear triad becomes critically important to the optics of and the belief that our adversaries have to have that we have the capability and we'll use any kind of capability if we're attacked, if we -- if we -- if we have to use the capabilities that we have if America is threatened.

 

We don't want to do that, obviously.  That's not our option.

 

But unless you have the deterrent, and that the whole point of deterrents, the deterrence is to assure that you don't go to war, is to deter war, to deter any country from being so insane to attack this country.

 

So I think that has been one of the most important areas that we have gotten into, explored.  Secretary James is very committed to this, she's -- as is Chief of Staff of the Air Force General Welsh.   We're going to get this turned around.  We're going to upgrade positions.  Potential resources.  We're doing the things that we need do to.

 

And it's going to be also, reflected in the budget that we present to the Congress here in the next month.

 

But, thank you.

 

Q:  Thank you.

 

Q:  Mr. Secretary, Master Sergeant Donohue.  What do you see as the biggest challenge facing the military, as we move towards 2015?

 

SEC. HAGEL:  I think the biggest challenge is the uncertainty of our budgets.  You know, the technological edge that we have today, all the platforms across the services, as everyone in this room knows, didn't just appear as a result of efforts and commitments two years ago or three years ago.

 

These are -- these are 10-year investments.  And when you have sequestration and uncertainty of budgets, and the abrupt, large cuts in our Defense Department.  And if sequestration continues to be the law of the land, as it is now, over a 10-year period, we'll look, the Department of Defense, at taking almost a trillion dollars in cuts.

 

And, by the way, the threats aren't getting any less.  A year ago at this time, ISIL was not controlling a good part of Iraq and Syria.  There was no Ebola outbreak in Western Africa.  The Russians hadn't invaded Crimea.  And all of the other dangerous components that are there continue to be out there and in some areas will become more sophisticated.

 

So, our demands aren't getting any less.  And I don't think the demands on the Department of Defense will be less over the next few years, I think they'll be more.  I don't see us getting into -- into long land wars over the next few years, but that doesn't mean that we are not going to be pressed to do -- to do an awful lot.

 

Well, if that's the case, it has been, certainly, in the last year, couple of years, then we're not going to be able to at all fulfill the defense strategic needs and the kind of resource commitments required to assure the American people of their security, if we continue to take these kind of cuts.

 

So I think that's the biggest challenge that we face, because as I said, in platforms and our technology, our readiness, any component of our services -- you all know what you went through in 2013 when -- when we had to shut all of our exercises down, our training down, our sailing down, our flying down.

 

Government was shut down for 16 days.  We had to furlough people.  Now we're coming back on some higher ground, but sequestration comes right back in FY 2016.

 

The other thing that gets -- I mentioned here in my first part of my answer -- gets very little attention, though, is yes, the numbers, the dollars themselves, but the planning -- our planners can't commit, because of the uncertainty of their budgets, because not knowing what they're going to have to commit.

 

So we're having to pull back our -- our commitments on new platforms, on our research.  I've tried, in the two years I've been there -- and -- and we've so far done a pretty good job with it -- to protect research, to protect as much of this as we can, and I -- as I have cyber.  We've actually increased.

 

Cyber is probably as big and new a threat to the national security of this country as there -- there is out there. I mean, that's real, you know what's been going on in the last few weeks.

 

But the next set of leaders in the military are going to be faced with a reality, if sequestration holds, of having to make these cuts across the board.  And -- and no one is going to escape the cuts.  And this is -- this is not in the interest of the security of this country.

 

So I see that is the biggest threat for our military the next 10 years, but also for this country.  Because we have one job.  That's the security of this country.  We have no other job.

 

Our job is not to make policy; our job is to implement policy.  Some people get confused with that.  That's not our job.  That is not our job.

 

We know how to do it better than anybody else in the world.  But if -- if you're going -- if America's going to ask us to do this, then we have to have the resources to do it.

 

Thank you.

 

One more?  Okay.

 

Q:  Mr. Secretary Master Sgt.(inaudible) -- with regards to sequestration, what has been the biggest challenge in running the Department of Defense.

 

SEC. HAGEL:  Well, the Department of Defense -- as you all know, because you're all a big part of it -- is the largest enterprise in the world.  It's the most complicated.

 

When you look at the -- at the vast dimensions of the Department of Defense, what does -- what does the Defense Department consist of?

 

Well, you've got the four services, each their own culture, each their own missions, their own structures, their own leadership.  Then you've got all the other components of DOD -- research and development, acquisitions, and you know all the departments.

 

We have more Senate-confirmed civilian leaders than any other department.  Nobody's even -- even close.

 

The numbers are staggering.  When you look at how many uniformed military we have, including reserves, National Guard, civilian employees, contractors, partners around the world.  So you start there.

 

And -- and I've always thought the smartest leaders are the ones that will let people manage.  You cannot micromanage or even attempt to micromanage this -- this department.  You have to rely on the leaders of each department.

 

Now, you, as secretary of defense, and my team, have responsibility of assuring that we have the right leaders.  But if you think you've got the right leaders, then let them do their job.

 

Now, there're reports back.  You know what's going on.  I -- I meet with our leaders all the time, all the time -- our chiefs, our senior enlisted, our secretaries, our undersecretaries.  I'm constantly, constantly meeting.

 

I have a private lunch with junior enlisted every month and junior officers every month, because I need to know not just what the generals are thinking and the -- and the masters, sergeants, chiefs -- and the sergeants majors.  I -- I need to know that, but I need to know what the guys at the bottom are thinking too. So do you guys, and you know that too, and you do it all the time.

 

I need to know.  I need to know this E5's thinking.  If you got a smart E5 out there and that E5's concerned about his family or her family and "I'm not sure this is the right career," we got to be very careful here, because we'll lose quality people.  We cannot lose quality people.  Quality people are everything in any institution.

 

So I think it's the juggling and the balance, the time -- you've only got so much time.  Like each of you, you got so much time.  Where does the secretary of defense employ his time?  Where -- where -- where do you use that time most efficiently, most effectively?

 

Now, you always build in some margin for crises.  That's happening all the time.  You got to travel, you got to pay attention to world leaders, you have to pay attention to your counterparts, but you have to pay attention to each of your services, the leaders of those services.  You have to travel around -- at least I think it's critically important you go to the bases, and I meet at town hall meetings every time I'm out -- and I'm out a lot -- with the troops.

 

Let them get connected to you.  Let the leaders get connected to you.  Let the leaders know who you are.

 

So I think the biggest challenge that any secretary would have, but certainly that I have found, is -- is -- is how do you use your time and make sure every minute of that time counts -- make sure every minute counts?

 

And it's imperfect.  Sometimes you'll be drawn over here because of events.  The Congress hearings -- I mean, there's so many components.

 

Secretary of Defense has 535 boards of directors, 535 members of Congress -- 100 senators, 435 -- and I get calls -- called up to testify, our senior leaders do, I have to answer that.  President of the United States, national security adviser, interagency -- that's another component of this job -- work with the secretary of state.

 

So it's -- it's a job, by the way, that I think is spectacular.  I think -- I -- I love the job.  I've loved the job.

 

But it -- it's -- it's a job that is as consuming as any other -- I don't know a job that would be so all-consuming. President of the United States has got the toughest job, because he's got it all.

 

But secretary of defense has got -- and I think, then, last point I'd make, always remembering that you have -- as I've already said, you all know it -- you've got one bottom-line responsibility.  That's the security of this country.  And you live with that every day, every day, every day.

 

So no matter what happens, like Eisenhower's note, you're responsible.  It happened on your watch, so if it's sexual assault, anything else, you're the secretary of defense.  You're responsible.

 

But it's -- it's a great privilege.  It's the greatest privilege on Earth to have this job and serve with you.

 

Thank you.  Thank you all very much.

 

(Applause.)