that we are, you know, critically vulnerable to another country and say china in particular, i think that it creates a sense of insecurity that is destabilizing for the world economy and frankly for the world and the flip side, there are things -- there are things that we hold the choke points where, you know, where we flex, we are willing to choke and willing to press on those choke points that it creates anxiety and nervousness in other parts of the world. so where we are today in terms of resilience and diversification in our supply chains is not where we want to be. where we are today in terms of the clean transition, in terms of, you know, future proclimate economy and world is not where we know we need to be.

.. ..in the hands of the ability

to distort the market to take advantage of the dominance by jacking up prices whether it's shrink inflation or international context economic coercion if you think about it today is tomorrow they are ones we need to be able to manage not being faced with of the same risks over and over again.

>> i want to ask a question about traditional allies with developed economies whether it's the ua or those fields what is the role with respect to the trade policy if you look at an agreement there was a big focus that would bring together the way the regulations were set. >> they are still our partners and it's still important. when you talk about the evolution in the approach it's

what we undertake with our partners and you will see how much time i spend in brussels and the prioritization is still there. the 2021 was the first year that the tree of the track was introduced into its continued because we found it to be an important platform for those allies in particular we will say one of the topics that comes up

it is a very well-to-do group of economies that even in the g7 you see it's reflected in the g20 andn the wto how we partner with others in the developing world and templates for the trade and economic partnership i that is a an important part of what we try tot accomplish for whatat is the modern innovation

that breaks us further out of the patterns georgetown law school. thank you very much. wanting to turn to the sort of politicalex context the recent study finds four things. ba second it did not bring back any jobs into the protective sector in third the retaliation from china data because a significant s negative harm on e

farmers and forth, and this is theam one i want you to commentn what they did do is increase the political support for trump and the republican party. they kept all of the tariffs in place and i wonder where that leaves room for any maneuvering in the political context which we find ourselves. >> i'm not surprised you asked those questions or maybe even the study. something i want to be open about i think that reducing trade policy down to a conversation is unfair and not conducive to a robust appreciation for what the trade

policy really is. in many ways it's a red herring but i don't think it is r versus d politics i think it's a red herring that is a continually fostered by the traditional trade approach versus the need to evolve into a new trade approach so let me say more about that. what's important to appreciate is that there are tools that can be used and i know this is very much your background they are a tool for remedying. they call them trade defense

instruments. within the world of the wto are the used counterbalance unfair tradein like dumping and illegal subsidization. what i also want to reflect his trade policy and economic policy isn't just tariffs and this iso something i want to distinguish on behalf of the biden administration because we are focused on reinvigorating ensuring there is more opportunity in the economy that we can address the increasing sense of economic insecurity so we deployed a set of tools.

we have kept a lot of the tariffs because we see value in this exercise of building up the middle class and reinvigorating the american economy but we haven't stopped there. trade and tariffs are not the only tools you need to accomplish those goals and i want to highlight one of the pillars of the approach which is the investment starting with infrastructure, going to science and the inflation reduction act andct the clean technology investment incentives that president biden has accentuated against many people's expectations in the past three years so from our perspective it is if the economy doesn't make a distinction between the different silos in the way we approach it, then our approach

needs to break down the silos and take the tariffs as a tool and the investments as another tool to reinforce policies that support and empower our workerso and encourage partners to be supporting and empowering their workers and also promoting economic vitality through the enforcement of the competition laws that when taken together you can see what we are trying to accomplish and i would welcome anyone to do a study. you have to be looking at all these policy vectors as combined

as part of the economic policy family a significant injustice. >> let's go to a comment or question from the virtual audience. the former lead in the last couple years of this administration i thought you made points about how it has value and companies need to figure out how we will regulate as a result of the same language is often used by some of our partners as a justification for textbased rules that are the very smallest of companies that have high thresholds. if that ends up defining a small

group of companies that are almost exclusively and i wonder what you would say about that. do we need a nondiscrimination concern, can you say a little bit more about how the data value conversation should move forward multilaterally bringing together? >> sure. it's nice to hear your voice. and i love that you've identified yourself as a tax maven because some of these issues where they come together i can push back and say why didn't youwh make more progress. i do feel that way but i like you very much and i'm sort of just kidding. [laughter] it's one of the pillars on which the tradingch system is based ad so that is something we will always be looking at. the other piece of the puzzle is when you look at we are talking about data and technology when you look at the big tech players

they are almost all our companies and so i think that there is an important space we need to leave for other countries and other partners to regulate legitimatelyy in the public interest and not to be protecting their own market when looking at the biggest companies in the world that happen to be american companies. side note a question i've been asking and i think my colleagues are important to answering the question what is an american company if you talk about being headquartered here in the u.s. because from a tax perspective and again i just work near tax people all my life and have been told that trade is less important than tax but it's still a thing, how many of our

big tech companies are for tax purposes headquartered in other places and paying taxes there as opposed to here so if that is the definition of an american company i would ask you and others how many of these companies are really american companies and how does that inform the conversation? but what i really do want to enforce is we are looking at this issue of data and value and were have so many unanswered questions. i'm often asked if it is somehow some kindd of a surrender and a

surrender to the chinese approach to digital regulation control with respect to data flows the prc's approach is one that is informed by control. we know that the prc is going to be looking for a lot of room to restrict data to have the government tell where the data can flow and reside that it must be localized within their

border. we know it really doesn't reflect our values and if that is not what we want and i think we have a lot of consistency that isn't what we want. on the flip side when we take a look at ourselves and where we are right now whatever part of the political spectrum there's no privacy rights to their data here in the united states and they were trying to do something about it but in our system all of the data that is created is

captured and accessed by a small set of which companies. what we need to do is figure out from a tax perspective and regulatory perspective what is the place, where is the united states, what is our approach. if we are only leading this leaving thisconversation using d negotiations that is the tail wagging the dog that there are much bigger issues for our policy decision making and debate to raise old and address

first. thank you for your indulgence. >> the return for one second because the elephant in the room the proposal in the context of the electoral campaign would be not trade the defense or remedy but kind of a blanket unilateral increase when that feels so

attractiveat politically and its a retaliation risk as far as what other countries would do to the exports that are so real what do you think might be addressed? thank you. >> i think you described it as anas elephant in the room but i think it is a person you are talking about. challenge yourself and recognize that they are a tool. they can be emotional and hyper of dramatic and we've seen them that way in the past. whether it's coming from us or from others in the national

debate, take the time and use the trade expertise and interrogate what is being proposed and ask what is the objective and how we can use liberation to accomplish those goals and how does the trade liberalization and other tools harnessed to promote sustainability and resilience and more inclusive economic outcomes. but what is the goal that you're trying to accomplish and whether

or not you can articulate a coherent strategic approach and i think i will just bring it back to the way that we have approached to contextualize it around the overall goal of reinvigorating america's economy and how we can work with our partners on a constructive vision for how we do this together. what is the strategic

justification for keeping the sectors? >> we should ask him where he drew the line around strategic and nonstrategic i because in te concept there are things that may be we feel like are not strategic but that is a really important question and it's a hard one. to let that go wherever it was going to go and in the early days of the pandemic that hurt us a lot. so o they were told it is

politically v important. it was the textile industry what we still have that was able to repurpose the capability and step up and actually start producing some of these things

in 2019 with the confirmation

the overall goal of reinvigorating the american manufacturing economy with one additional item is 95% of the world's consumers outside of the borders and one is recognizing that we actually help the world's biggest importer in the second of all there's a limit to what you can sell abroad. i'm very pleased to have a robust reflection of the administration agencies and another member of the team and i think that as we adapt our approach to new realities to looking at sustainability both for the planet and for our people resilience and supply

chains and where things are produced and the diversification and i couldn't be more pleased to e be a member of the board ad to navigate all of these decisions and opportunities within agency. >> let me recognize the ambassador with all subsequent to look up to as a great role model on the board of directors. [applause]

electric grid including affordability and reliability issues. watch coverage of the house commerce committee on c-span three, c-span now, our free mobile app or online

it is my pleasure to welcome you to the inaugural democracy address a rebranded a series which has leaders at the defense industrial capability to discuss

issues arising at the intersection of the defensein ministries and industries that serve them. at today's event features the honorable assistant secretaryryf the air force for acquisition technology and logistics to deliver remarks and have a conversation about how the air force is working. i wouldn like to thank andrew ad the audience for joining us today for this discussion. i would like to disclose sustainable nonpartisan strategies for the most important security challenges facing the united states to honor the legacy of service and general brand scowcroft to the

cause of security, support the leadership incorporation with allies and partners and dedication to the mentorship of the next generation of leaders. within the center it generates ideas and connects the defense ecosystem to promote an advantage to the united states and its allies our work identifies the strategies, capabilities and resources the united states needs to detour. this afternoon's events exemplifies one of the ways we deliverede on this mission. at the air force is undergoing a significant transformation prioritizing speedy and its acquisition plans for a changing threat environment and new emerging technologies. it's a pivot in the acquisition

uiapproach to ensure the capabilities with innovation and recruitment of a highly skilled workforce to maintain u.s. strategic and operational advantages over its competitors. they are forces moving forward to fill the next generation platforms like the strike bomber and collaborative combat aircraft while also working to adopt software into digital services. it was the focus of the recently released commission on the adoption report that determines while the u.s. is a world leader in innovation it would have an adoption problem. the commission laid out recommendations to the military

services and the congress to consider to improve the acquisition technology and i'm pleased to say it will continue on software this year mr. hunter oversees air force research, development and acquisition reactivities for over 550 acquisition programs and services the principal adviser to the secretary of the air force and chief of staff for research and development, test production and modernization efforts. he previously served in the obama administration is the director of the joint acquisition where he led efforts to field intelligence reconnaissance capabilities and developedai innovative solutions

to neutralizing chemical weapons. at the director at the defense industrial initiative group at the center for strategic and international studies and earlier in his career was a professional staff member of the house armed services committee. quite a career. as a leader he's written on artificial intelligence and national security, defense investments and low-cost access to space to name a few topics. following the remarks, he will join the atlantic council senior fellow the directors of our democracy project. before turning things over to the assistant secretary, i would like to remind everyone this event is public and on the record. we encourage our online audience to visit to submit your questions to the moderator. be sure to identify your self and affiliation and we will

collect the questions as people peruse them. for the in person audience youso may ask your questions directly using the microphone in the studio. once we begin the q&a portion please queue up the microphones and then i'll we will also encourage our online audience to follow the conversation on x using the hashtag for independence. without further ado, thank you for joining us and thank you. [applause] thank you for moderating and hosting this event. it's an honor to be here at the scowcroft center. i had limited opportunity to interact directly, but certainly many of my mentors and employers over the years spent quality time with him and he is one of

those remarkable figures in the national security and the thinkers and doers and actors, so it's great to be here. i appreciate the invitation and i do want to talk about exactly the things that clementine previewed the air force initiatives that are currently underway. the imperatives that we believe are necessary and are driven directly from the national defense strategy, the department of the air force that includes the united states baseboards and also mostly in the air force because i have a colleague that manages the space force programs, but the strategy of course they are closely related end of the activities capabilities are related and we work in close concert to deliver on the capabilities that we believe are applied and necessary to fulfill the missions under the national defense strategy.

so our operational imperatives initiative has been out there for some time but it's closely related to the recent initiative that is optimizing for the great power competition. and i say they are closely related because it's been very bemuch focused on identifying te discrete modernization projects and programs that are necessary to accelerate them in a very rapid timeframe. the optimizing goes beyond just looking at modernization, beyond acquisition programs and looks at the entire department of the air force enterprise. all of our offices and structures to ask the question is a structure that we have today fit for purpose for the missions or are they perhaps

still in a structure burdened by the legacy of the previous strategies and national defenses focusespr for example or as the middle east and the global war on terror and theyhe do not alin properly with today's mission and where we see the mission going in the future. that part about the future is important. there's a lot of urgency of today and that very much is driving action for the department of the air force. but we also recognize thee competition part is incredibly important because it is not short-term.. it's long-term and our hope is that will be a mostly peaceful if not entirely peaceful competition. so we can't be exclusively focused on near-term threats we also have to understand the

long-term shape so no simple task but it's what we've undertaken with the sec. end of the chiefs optimization and initiative. i'm going to talk about why because the details of this are things you will hear a lot more about at the event that starts on monday of next week so stay tunedun for that. you will hear a lot more about the specific ands. discrete initiatives but i want to talk about why and some of the problems we are trying to solve

and how we can get after those problems using some examples of programs many of you are already familiar with that have been some of our guiding benchmarks to say we know what it looks like and it somehow made its way through the system even though it's not designed to support it. i talked about the operational imperatives that are driven by discrete missions they air force, and i will focus mostly on the air force but keep in mind we work closely with the space force and they have to be able to accomplish specific technical capabilities required to do that.

in some ways it is different from what we've had to do in the past and if you go back some decades when we had a long run competition in that case the cold war and soviet union we had to generate a strategic competition you could never rest oror relax the situation was always changing and we have them designed for that purpose. although it has its flaws for sure and its critics, the defense acquisition system was designed in that environmented o engage in the competition with a very competent and capable strategic competitor not unlike the situation that we find elourselves in today.

so what is the nature of that? one of the complex systems that works in close coordination we have the tanker aircraft that work in close coordination supplied with weapons with weapon experts and all these things have to work in an integrated fashion to be successful. we were able to leverage that over the last 20 plus years to do very but very modest scale and usually not at something you can leverage and ways to be

judicious then you've done it and you can rebuild and reset. but at the pace and scale with a huge necessity for integration. we stood up for the first time characterized so they run the acquisition programs and they are assigned a program and of the job is to deliver the program and there's kind of a

network to make sure they are leveraging each other'' capabilities but that is something that happened as a result of individuals and personalities and not that we are currently postured to do systematically. we a need to be able to do that again. we created and is the first step the general and his mandate is for command-and-control communications this is the

command and control across the entire force and ultimately with allies and partners as well. they know a thing or two it's the hardest job he's ever given anyone to do. that's an example of what i'm trying to talk about is the ability to do integration across the stovepipes and acquisitions community but also the operational community across the department to a much higher degree because the system enables it so that's a huge part of what we needed to accomplish and want to accomplish. the second thing i want to highlight is the need to take

science and technology and turn that into the field of the capability at a much more accelerated pace to turn the wheel faster and that we see as well because the national defense strategy talks about a pacing threat so if that's our pacing threat that's the pace we have to meet so we have to be bable to take technology from e phase and i would assert because there's a very good work happening and incredible in the private sector and commercial sector and abundant commercial investmentwe leverage from the department air force and the challenges finding a way to integrate and deliver it on a much faster pace.

if the example i would like to point to hear is the program to deliver the combat aircraft within the research laboratory called sky board how to apply intelligence to allow them to be partners. that's slated to be an acquisition program to deliver an affordable capability to partnerr with our aircraft fora wide variety of missions to include strike and other combat

missions. leveraging a lot of other foundational architectures that i will say more about in a minute and get on a path to deliver capability on a rapid timeframe. that is to make a routine way of doing business and more to come as i said on how we think we can accomplish that goal. thee third piece as was true in the past with of the long-running competition we need our partners and allies more than ever. with a partner in a allied piece of it has to be integrated.

in terms of what does it look like we have been working assiduously with our closest partners and allies to integrate them as well and certainly it's a highlight of the program to have them as early adopters and partners and enablers in that approach and iteration. so that is another element that is critical in our overall impulse for the great power competition. so i want to talk ae little bit now about how we see that we will likely do this, not the specific initiatives but more than nature of the kind of change we think we need.i i eluded earlier to the need to

work with industry so as pointed out. industry is the critical partner delivering those capabilities. we alone are going to be successful without substantial work and investment from industry that includes traditional defense industry an emerging defense industry those that committed themselves and they are looking to grow the capability and presence in the defense industry and then companies that are commercial looking to grow the defense space but are willing to do it if there's money to be made and if there is an inherent capabilitybi we need. we understand ultimately is a

critical source for the things i described both the core capabilities and the extensive expertise so we have to work at the close partnership to deliver the capabilities and what do i mean by partnership for those of you that watch the acquisitions base sometimes it's popular to talk about andar other times its not g popular. i'm trying to use partnership in a fairly specific way. what we want to partner on is a series of architectures that provide standards, interfaces andan abilities to link things together. you can imagine the kind of architectures and standards for wi-fi or bluetooth setting

process to the benefit of the department ofst the air force to ensure they can be integrated in a logical way and in a way we don't have to reinvent the wheel 1000 times over and it's not a static thing. we see the famous ones in the commercial world constantly involved in updated. we have to be able to involve evolve ourcapabilities and consy update them. what i'm talking about is partnering on core architectures the department of the air force architectures that enable us to

field that capability quickly, integrate it and evolve it rapidly over time. it's often very theoretical but we have a pretty concrete example of one with the mission systems and this is an architecture developed for plug and play that you could pull out a guidance system providing navigation and guidance from a different manufacturer we don't have to spend years and millions integrating it just plugs in and works so working closely with

industries the architecture has been developed and it works and we are implementing it on multiple o new build platforms. that's the example of the kind of thing we need to do and at thatthe partnership we need to d with contracts and traditional mechanisms and from time to time love that still true so we don't need to use the word partner like we are going to hug it out every time. there's this key element of partnership that for sure we know we need and we needed to share and we have been working and i'm pleased to say the partnership is going well.

it's how we designed them, what we call digital material management. the development of the software, how they are built and produced and ultimately to sustainment including the contractor logistics support that touches all of those and echoes deep into areas of the industry that has the vast majority of expertise. it's also in his life learned necessary to integrate with their core business systems and notd something the government s necessarily either does or wants to control so we have to work closely to set standards and interfaces and i think it's a major step forward on.

all of this comes together, the partnerships, the programs, it comes back to money. you've got to have the funding to pay for these things. it's not necessarily cheap or easy to develop a sophisticated architecture for things like integrating complex defense systems. so we have to be willing and dedicatede to making investmens in those areas and we've done that in the department of the air force. they've made h investments in te battle management if and when we get a budget request many of those investments will have the

funding to execute those things. some things are already ongoin'. we've been able to continue them under the continuing resolution the battle management is to some extent the collaborative combat aircraft is in the example of that. the 24 budget will allow us to accelerate our efforts and go beyond all those areas the critical investments to substantially accelerate our efforts and that's what the budget will allow f us to do to accelerate our efforts on all these things. the most important message that i can deliver today which is also the same message nothing can be more important than gettingti the fiscal year 24 budget so we can say hit the

accelerator on all these initiatives and move them from the idea phase to the implementation phase and do it as fast as possible. i'm looking forward to the conversation with steve and i will turn to that mall. [applause] >> that was as good an inaugural democracy address as i could have hoped for. we have rebranded what we used to call more clumsily i thought the defense industrial policy series, so i think it's a better brand and that was a great launch to the series got 40 minutes to do a couple things.

....even those asking questions i would ask that you identify yourself as it may be germane to your question. let me pick up right off where you left off even if it is a

random sampler of things. as to the possibility, the dire possibility that we would end up in a full-year continuing resolution, have you got a number on the dent, the dollar value of a dent that that would put in your 24 acquisition plans? >> i do. it will set us back for the good reason that congress would undoubtedly pass authorization act that demands pay raise. >> so raise raise has to happen? >> it's going up.

now you're at a lower number and that's a reduction. you get issue of the congress that puts in proviso that not all bills are enacted. you have 1% reduction. >> that's real money. correct, it's not a small budget. it's real money and then you have the effect of certain accounts will inevitable off the table, cuts, military pay is one of them and i would imagine some other benefits would be the case, priorities would be

protected. >> yeah. >> they have not yet fully recovered from the original sequestration a decade ago. and if we do it again the damage would be almost inconceivable to me. >> we would get to brighter things to talk about but there are a couple of programs that you can't start without a full year appropriation? >> yeah, there are. you know, i said i wasn't going to the talk about the space force because it's not in my job jar. i'm passionate of the capabilities because what i see they can't succeed unless the space force is planning to deliver. >> there's going to be some

satellite involved in that. >> satellite involved in targeting. satellite involved in communications, satellite involved in communication and timing. so almost every capability that i'm working to deliver depends upon a space capability that's related. and we have them. they are vulnerable. a number of investments are planned and partt of 2024 budget to improve resiliency of space architectures. i think not my job but i think it's almost every single one of those is on hold until we get that '24 budget. they saw a need for the capabilities and we need to get after that.

>> i have a question i had written down why number 1, pace and scale, why number 2, more quickly turn thing advanced technologies, science and technology investments into programs leveraging partners and then your discussion about industry drawing on the fermented experience you've had going back to the obama administration, is the acquisition management system, everything from practices to regulation and law, is that the toolbox you need to deliver against these four things we just mentioned? or do we also need -- is it a good enough toolbox? >> we are adding tools to our toolbox. i will talk a little bit about some of those. some are statutory. let me start just on the things we can do with an existing statute and within the existing

process. we have a lot of support from congress to do the right thing, a lot of support from senior leadership in the department. a lot of support to do the right thing and enable us to do the things we need to do. my broad answer is yes, we have what we need but we still need new tools because there are discrete problems we need better tools to solve and i think there are new approaches. when i talk about partnering with industry, the architecture itself is a tool. you can argue we've had those in the past, highly architected system that has stood up for a number of decades because of that. not without challenges. it has been a success. it is necessary but not sufficient. we've got to be able to work

with industry. i would point to our approach to collaborative combat aircraft. we have talked in recent weeks about the fact that we are working with five different vendors on the early stages of the collaborative aircraft. a classic program of the past, we would have already narrowed it down to two, even at this early stage, in part to save money, in part because of the complexity and only so many people can do the job. in part because it's hard to maintain competition. big requirements for the government to have expertise at the table evaluating and working with a wider range of industry partners. we are trying to take a next gen approach.

we've drawn some fire because we've named some programs gen, when are you coming up with a new name? aside from the fact that mgas is really great for tanker to airplane, next gen mean something about our approach to the program that we did not want to skinny down the space of suppliers to one or two and rely on them to get us everything we need. we want to open the aperture. mission systems providers deeply engaged readily with the air force from the get-go and continuously through the program. and not get to a point where it is one prime working with us and everything is that doo-wop a. -- that duopoly. you've got to have a nexgen model. what's the use of architecture when there's only one company building into it?

then it is just their architecture. our approach is enabled by this gen approach, a wide variety of vendors, traditional and nontraditional. and continuous competition through the program lifecycle. >> you alluded to the fact that in the past, a dominant reason why we haven't kept more competitors in the development of programs is money. is the reason we are able to do this, say on cca, because we have more money or is there something about the technology is, the marketplace or the processes we are using that allow us to do this and not simply pile more money early in the program? >> i would like to say we have more money but we don't. [laughter] >> which is why i asked. >> you have to prioritize something like architecture. you have to persuade generals in

the air force and the secretary and ultimately congressmen, senators, staffers, that investing in architecture is a good use of money. even when you're talking about tens and hundreds of millions of dollars. they say i can get an f-35 for that, what does architecture do for me? we can answer that question. i've tried to answer that question. it does require a commitment in the organization to really put resources against that. we have asked industry to pitch in their own money and help us develop the architecture. and several of them have been willing to do that. we have some new folks coming in who say this architecture approach really matches my business model, so there is an

advantage and i am willing to invest. to your answer, it does take money and we don't have new money so we have to make it a priority and we have done that. we've done that with our dominance families, and we are beginning support from capitol hill providing we can get a bill. >> let's stay with industry. i'm going to ask a broad question and you can answer anyway you want. from your seat, unlike your phrase what does right look like? what does right look like in our industry right now, and conversely, offer some that's called them challenges as opposed to what does wrong look like. no one contractor, but the industry as a resource to solve

and realize these ambitions you have. what are the strong muscles you see and which need further development in industry? >> let me circle back, it might be a little weird, digital material management, ultimately the foundation for delivering military capability in the future, i believe. you see it happening, the digital threat being adopted all over the place, tesla and spacex , and a number of companies have gone all in, traditional car manufacturers. we can see the benefits of it and other industrial endeavors. we certainly see the benefits of defense, i think it's even greater because of what is required for military systems, which i would argue is beyond what is required for commercial systems. i think there is even more advantage for us.

with additional material management, it is a huge investment on the part of industry because it's not just what they do for us, it's how they do their own in their company, inventory management, how the engineers work, the tools work, healthy accounting is done. every level, this is essentially part of one digital threat that has to work together. it is not one ring to rule them all. there are multiple tools. the best tools and there are more than one, in the commercial sector for doing digital design, this is enterprise systems, inventory control and management, there are a wide variety of commercial tools out there. it's never gonna be the case that every company is going to pick one. the different companies are not all going to pick the same one and the companies have to work together as part of an integrated supply chain and they all have to work together.

the vision has to encompass the ability to take the best state-of-the-art commercial tools and have them work together and in purpose built tools for defense purposes that work with the commercial tools and it is tools, plural. they have to come together. that's something we could never do on our own. we have to work with industry on that and industry has to be willing to invest for that to be troop you we've been on a journey with industry over the last maybe 10 years on how do we realize that? we are kind of growing it. i think of digital material management as the full realization that someone will replace me and maybe they will have a bigger vision. it's not just my vision, my military partner, this is a vision from air force material command and the secretary to do this together with industry. >> hearing that, on the needs development challenge side of the ledger as opposed to great

strong muscle. >> i think it looks like we have a suite of very powerful commercial tools we can and are adopting. we have industry investing, we have air force and other services -- we are also working with army and navy on this. we are working closely together on this. i'm going to say that's what right looks like. we have a lot more digital threat today than five years ago. >> i'm also hearing that if you and the defense industry, don't aim to and quickly get up to the standard of digital design, you will fall behind. you will not be able to answer what the air force needs from our companies. >> yeah. did you want me to get to the critique part? >> i thought that was the

critique part. [laughter] lay it on. >> what are the challenges? we've seen real gaps and deficiencies. supply chain disruption that came about as a result of covid. in and of itself is a problem but it also illustrated the fact there is a deeper problem, which is we don't have a robust enough industrial base, especially in certain very specific key capabilities, we are down to one , the worst case is zero. in many cases, one. >> in companies? >> the ability to generate a solid rocket motor of a specific type we need. the ability to generate specific kinds of sophisticated electronics that we need. sometimes we are at zero, sometimes we are at one, not too

often, sometimes at two, but not healthy. we can't search. it's weaknesses in the supply chain and the industrial base and a lack of ability to search. what covid did is it created a surge to which the system could not respond. >> compounded by the war in ukraine converting to test the system. >> parallel shocks to the system that show we have serious deficiencies in those areas. i do think the approach i'm describing is meant to help solve those problems, solve them overnight, but by having a wider pool of offenders, more continuous competition, i think we can substantially improve the health of the industrial base long-term. short-term we have to work these problems one by one. >> this is bringing me to

another thing i want to ask about, the defense strategy promulgated by ost about a month ago now. i think it's fair to say begged a lot of questions about how it was going to address in more practical form rather than rhetorical form the efficiencies you are repeating, and what you also see enunciated in the document. at least within the scheme of air force, what are we going to do? capitalize companies that don't exist, create incentives for prime contractors to motivate them? what does the air force do more practically than expressed in that strategy to fill these gaps or address these gaps? >> one of the biggest changes is if we -- is we have a national

defense strategy, which is worth reading. as you know, we have a government that is a little bit allergic to the idea of industrial policy. my own believe is you have an industrial policy whether you know it or not or whether you admit it or not. but you don't necessarily have a good industrial policy, and industrial policy that makes sense. you don't necessarily have a policy across multiple department of the government. or even multiple peo's. how do i do business with the department of defense? who buys things? theoretically i buy things but the reality is you need to see this peo, this peo. there are hundreds of buying entities. in theory and i'm afraid far to

often in practice, we might have hundreds of strategies across the department of defense i'm not saying we've arrived at nirvana and we have one strategy and everyone is following it but that is the desire. this will not all be identical but we want to go to a place where there is some consistency across the department and how we approach these things. i would argue we are doing that in some of what i've already described, working with the army and navy on management architecture, which we are doing. working particularly closely with the navy. for industry, they don't say i have to do a different way for the navy in a different way for the army and maybe completely differently for the marine corps. part of it is we are coalescing into a more common approach. there's work to be done in an

implementation plan, what are these discrete investments? some of them we already know because there's money in the budget we asked congress for, congress always comes through when you give them a discrete, obvious challenge. when we can give them a very discreet thing, they are often very supportive of it. we will have to do more work to identify the additional one by one set of started to emerge. many of them in electronics, castings and forgings, bad batteries. a lot of these are somewhat known, so still work to be done but i think we also have to remember the bigger picture piece, which to me comes across in flexible acquisition i think that gets to the next gen style of approach. we need these nexgen tools. we can do them under our current

statutes and policy that doesn't mean we know how to do them. we can write policy to make it so that everyone can do it that way as well. >> getting back perhaps to the first question, we don't need a lot of law and new regulation to realize this vision, we need to change some of our practices and propagate best cases. my hearing you right? >> with one exception, we are excited congress gave us what we are calling quickstart authority, this is something the secretary has been advocating for. he's said multiple times he's been advocating for it for decades. we included a request with our physical 24 bashar fiscal year 24 request. it's similar to the acquisition authority. when you jell down, it's focused

on requirements. i was all about meeting requirements, i firmly believe it is a wonderful and necessary thing, but will we didn't have something for the services to say i have something that is really important that i need to get after as soon as possible, not because people are dying in the near-term but because i have no time to lose. we said we'd like to get something that looks a lot like rapid authority that can be used at the service level. and congress was kind enough to provide us. we are working quite a bit to come up with what are the first really great ideas we can bring to the table for that authority? stay tuned for that. >> i get maybe seven more minutes and then we will take questions from the audience and i have a lot to squeeze in.

we will go a little bit lightning round unless you want to expand the first question. yesterday a bit of a blockbuster announcement about the army's decision to cancel its reconnaissance helicopter. one of the reasons was lessons learned from ukraine. while it is not a big air war by any means in ukraine, are there important things in air force is learning from ukraine that will turn up some aspect of those learnings that will turn up in changes to air force acquisition? >> i taken acquisition linens to it, i think there are tons of lessons from ukraine, many of them operational. to be fair, i think what i will be say with a broad brush is the lessons learned are things we kind of already knew but they've been brought home.

one thing we knew was dominance of the air is really important and really hard. you may not have it when you need it. that is just true, it's true going forward. it is increasingly challenging to obtain air dominance and it's not always achievable. the consequences of not having it are what we see happening in ukraine. the second thing, the importance of electronic warfare and the pace at which it moves. that's something we knew, but it has been demonstrated and it is a wake-up call. we had to do electronic warfare. this is a different scale and intensity and sophistication. and then the last thing is just the challenge of ramping and surging production. right? we did sort of understand that. but it's really been brought home.

>> ok. true lightning round here. i just want to knock down your big acquisition programs, any color commentary you might give us on them. let me start with, as it were torn from the headlines, b-21. seems like the aircraft is developing well. an earnings call recently, made known that they're going to have to absorb more costs than they had planned to. any other color commentary on b-21, but more specifically, do you worry about your prime contractors who have signed and they're not the only ones, boeing's a eating a lot of cost on the kc-46. to what degree does it concern him or herself with that? andrew: on b-21, right, program is executing from my perspective very well. we're very excited to be in flight test. we are excited to be on in terms of cost -- on track in terms of

cost and schedule in terms of baseline. this is what you're expected to deliver on track. executing very well. on the topic of what happens to industry when they have losses, i do care. absolutely, i do care. because as i mentioned at the front end, right, without industries' capabilities, we're never going to get to where we have to go. so we want our industry partners to be there for us in the long run and we do not want to undermine their long run viability by the way in which we approach programs. when i talked about kind of that nextgen approach, there's an element of that, right, i talk about continuous competition. so what do you see the dynamics of the past? the dynamics of the past are, if you lose the competition, you've

just lost 30 years of -- [indiscernible] -- and if you -- so you go all in to -- [talking simultaneously] then you find yourself in a situation where you've been very agrees -- you bid very aggressively and now maybe you're taking losses in early production on a program that you, you know, -- so it's a super high stakes environment. kind of the traditional way. one of the benefits of the nextgen approach is there's much lower stakes because you're not losing 30 years of business in any individual competition. you don't have to bid aggressively or nearly as aggressively. we hope people will still bid aggressively. but they don't have to bid super aggressively because they're worried they're going to lose multiple decades of business because that next competition is just around the corner in every case. steven: even in c. kr-frpt a., i don't -- c.c.a., you're not ashoing fixed price contracting.

andrew: we're not. that's been a tool from day one. it is the way commercial industry does it all the time everywhere. there's nothing wrong with fixed price contracts. right? but if we set up structures where we incentivize people to do things that they later regret, and then we regret, that's not good and we don't want to do that. steven: ok. andrew: we are going to enforce our contracts. [laughter] steven: speaking of kc-46, is there anything you can say that's not predecisional about the so-called bridge tanker, kc-135, nextgen, your nextgen tanker, actually, right? anything you'd like to say about that? andrew: there's so much goodness in the tanker world. [laughter] steven: we hardly have time, is that what you're saying? andrew: the quick version, so we are very focused on the nextgen air fueling system. it is important because the security environment, the threat to the tanker force is real and growing and we recognize that we

need a different approach as a result of that. so nextgen air filling is the destination. that's where we need to go. i always like to say, if you know where you're trying to go, it's a lot easier to figure out how to get there. that's where we're traying to go. there is -- we're trying to go. there is a gap between when we can reasonably expect a field and gas. and when we will complete the existing contract for kc-46. so that's where this idea of like a bridge comes in. so i can't announce to you today what our strategy or acquisition strategy is. for a bridge. but we're working hard on it. we know where we want to go. and what we're trying to do is have a path that gets us there. steven: maybe we will watch the space over the f.y. 2025 budget request. i don't want to infringe any more than i probably have on the opportunity for those of you who have come to ask questions. those of you in the audience who want to ask questions should stand at that microphone. that's how i know that you'll -- excellent. in the meantime, while they are

assembling, let me pull a good question here from online. retired admirable scott van buster wants to know, how is the air force addressing this growing drone threat and sophistication or for that matter even, is that an air force mission, counter unmanned aerial vehicles? what's up there? that's obviously big in the news these days. andrew: there's a lot of discussion about, you know, whose mission is it. i think the reality is it's everyone's mission. the nature and the scale of the threat is such that there's plenty of need for counter-u.a.s. across all of the season s*frs and multiple regimes and domains. but having said that, you know, we want to do things in an integrated way. so it may well make sense for someone to take on, you know, like an executive agent role or a lead service role on counter-u.a.s. i think still work to be done to define the parameters of what that will look like.

but u.s. air force is engaged, i think the army is deeply engaged and the navy brings a lot of game to it as well. the biggest thing that obviously stands out about counter-u.a.s. is not getting on the wrong side of a cost trade where you're spending a multimillion-dollar miss toll shoot down a -- missile to shoot down a much cheaper drone. you need systems so you can match weapon target pair to use air force terminology and so it's all in, right? everyone needs to come to the table. steven: ok. identify yourself, please. questioner: robbie with service capital management. so secretary hunter, you've eloquently laid out a few of the partnerships in the national security innovation base between government industry and even academia on the absentee front. but over the last decade, there's really been the growing emergence of the private capital

sector. and the air force has really been working with the venture world. where do you see the private equity world come in, especially when you're dealing with challenges like production and really scaleability where billions in the private equity world can come to bear and really foster and support the industrial base supply chain? thank you. steven: thank you. andrew: yeah, i think there's a number of companies that are entered. they explicitly targeted the defense space, that's the business they want to be in. it's not just ancillary to their other true business, it's core. and i think that's good. it's very positive. we welcome it. i would say one characteristic of these companies is they're very comfortable with fixed price contracting. in many cases they don't want to take on the infrastructure required to do cost-based contract accounting and therefore they like to -- there's one reason why we're not getting rid of fixed price contracts.

they're very valuable tools. i would point in particular, i don't have any favorites, i never do, an industry, but i would point out that a big company is one of the vendors on the c.c.a. that's a program that's about producing aircraft. it's not a demo. it's not a maybe we're going to produce something. the secretary of the air force has given us distinct and direct inventory objectives and timelines to get there and so now obviously it's a competition and may or may not end up moving to production of a system. but it's not theoretical that a company could be engaged on a major production program. steven: what about, if i may, the broad shouldered private equity firms that are sreufpbting in -- investing in, taking companies private, investing in ma taur companies. do they have a -- in mature companies. do they have a place in your -- are you interested in that

capital getting in the sector as well? andrew: well, they're in it, right? a huge number of defense companies are private equity-owned. i think it can be a good thing. a deep-pocketed private equity entity can provide that base of stability that most of our defense companies need. to work with us long-term. so it can be a positive thing. it can turn negative if you get a private equity investor who is just looking to, you know, make a lot of cash real quick and then exit real quick. that's not the kind of private equity investment i would prefer. steven: right. ok. there is a question here that takes us back to ukraine. ukrainian f-16's. this is from colby with the insider. the u.s. is leading sustainment for ukrainian f-16's. can you talk about those munitions sustainment requirements and the degree to

which the air force is getting, you know, again, if we could get a supplemental on emergency supplemental that the air force is poised to respond to? andrew: yeah. sustainment's a huge priority for us. again, we're going to have a lot more to say about readiness and its importance and what we think we need to do to up our game next week. it's a huge priority. we have to invest in it, right? there's definitely a money challenge there. there's also a process challenge, right, how do we identify or how do we give our system explicit direction and guidance prioritization to say what really makes a difference? is 5% more aircraft availability of a-10's what makes the difference? in our future fight? i would argue it's not. steven: is the u.s. air force going to do the sustainment for the ukrainian f-16's? andrew: yes. that is a role that the united states agreed to and our program manages f-16's, will be the

enabler. and our departmentos. steven: perfect. questioner: thank you. defense leadership forum. speaking to acquisition. can you tell us with regard to all the air force bases, many of them reaching back to world war ii, on islands that are now being rejuvenated and refacilitated, can you say whether they're going to be working with the army corps of engineers or others with the construction in the milcon side of that? andrew: there's a lot of work to be done to have the infrastructure in place in the parts of the world we know we need to be prepared to operate. to support our concept of operations. the term that we use a lot is agile combat employment. you're not tied to too many sets

of hangars or runways that can be easily targeted by a potential adversary that you're out of the game because you just can't get off the ground. and so it's a more distributerred approach -- distributed approach. the agile part of it is really challenging. but it definitely creates a demand signal, not just for infrastructure investment, which it does, and as you've noted, right, there are some recently announced projects to revamp air fields that have been in the pacific in the past and have been out of use. but it also creates a demand signal for support equipment, for fuel infrastructure, for the tools that allow us to turn aircraft around and to provide them with fuel, provide them with weapons. there's a huge investment there. and that's an investment that whether we get a 2024 budget, we'll be able to make substantial progress on. steven: thank you. let's take the next question at that microphone right there, please. questioner: craig sanders, thank you for the speech, from csis.

steven: get closer to the microphone, please. questioner: a question about government reference architectures. can you elaborate what you've been doing to bring in allies and partners in cooperation there and are there steps -- you mentioned industry investment, are there steps allies can take to win on ramps and the like? andrew: yeah, i'd be happy to talk about it. it can sound like somewhere there's a set of like blue paper with lines and drawings on it. it's much more concrete than that. in fact, it's mostly software-based and so we can, we have and we will share the necessary tools and the necessary code with partners and allies for them to participate actively in developing and

implementing these, a sentencingtures in their own system -- these architectures in their own systems. they can architect their own system to match the structure. it's the nature of the global defense industry that a lot of it resides in the united states, inevitably the vast majority of them are going to require capability from u.s. firms as part of their architecture. but they can design their own needs. they can also design things that we can adopt and we can adopt it pretty seamlessly if it's designed to our architecture. that's the beauty of this. it's how it enables interoperability and a whole range of advanced collaborations between partners and allies. that's a critical piece of our strategy. steven: for those of you watching online, we have a little bit of a late start. i'm going to run over, a couple, three minutes, in order to take two more questions before we wrap. questioner: thank you very much. i'm a member of the press with the asia today.

my quick question, the last two weeks, china was in the news on capitol hill and among the industries here. my question is that, how can you convince congress that chinese activities in the u.s. defense priorities and where you go to -- [indiscernible] -- and finally, if any of the u.s. department or industries -- defense industries are using any made in china parts? steven: get the last piece first. andrew: it does happen from time to time. china's a manufacturing powerhouse in the world and therefore there's a lot of, especially as you get to the lower level parts and components that are produced in china. it can be challenging from time to time to keep all of that out of our supply chains. but by and large we're not looking for contend from china -- content from china and we work actively to keep it out of our supply chains.

our efforts are not perfect. it does happen from time to time. but our intent and where we find that, we take it out. on the question of is it hard or is -- what is it like working with congress and articulating the china challenge, it is not hard. i would say the vast majority of members of congress are at least as focused on the china challenge as the department of defense is. there's a lot of folks in the department of defense, some more focused than others. the secretary of the air force is notoriously focused on that challenge. it would be hard to surpass him for focus. but -- impossible, in fact. but nonetheless, i find that congress is very aware of the challenge and we're working well with them in clarifying that. having said that, you know, it has to be said, the resource levels that the nation is willing to allocate to national defense need to reflect that understanding and if we're under

the levels of funding from the financial responsibility act, i see a disconnect. steven: thank you. we'll take one last question, please. questioner: thank you very much, secretary. my name is samuel chen, i'm the vice president of the george washington union's alexander hamilton society chapter. i wanted to ask a very quick question about the e-7 program. i know the u.s. air force have -- does this have to do with the f-35's increased capabilities and increased from satellites. are we going to be considering more options for increased aircraft with increased

effectiveness? thank you very much. andrew: excellent question. i'll try to give an answer that matches the sophistication of the question. you're correct. we're moving away from the idea of one to one replacements. it's also true for e-7 and e-3. so, yes. we are trying hard to look at all of the capabilities across the joint force, what they bring to the table and then not go buy something just because we need the same number of the new thing that we had of the old thing. but what is the number we actually need given the capabilities of the joint force. so there is a difference in number between the e-7 and the e-3. the exact, you know, difference in total number is still to be determined. ultimately. the way acquisition programs work. we have committed and we are engaged in a rapid prototyping program for e-7 which is two aircraft and we've talked about production quantities that we anticipate needing but as of

now, we're in contract for that prototyping program. i do expect a production program as well. and the capabilities of the e-7 are such that you wouldn't need one for one even if you were comparing e--p and e -- e-7 and e-3. we think you can cover things more adequately at a different number. having said that, we're wary of the dynamics of small fleets which can be really challenging for sustainment and just inherently make operational challenges because you don't have very many. so there is a floor, if you will, of knowing you've got to build at least a certain number to have a real viability capability -- viable capability. so we're looking for that. and yes, your question you reference that f-35, their space capabilities are those things that have gain in the command and control space. and that is definitely part of the mix. steven: thank you.

that excellent question and thorough answer is a good place to end. i'm going to thank you and then i'm going to give you the last word. my ambition, longstanding now, for that matter, for this series is to improve the public conversation about issues that are arising at intersection of, as i like to say, ministries and industry. but also to give the public a sense of who these policymakers are as people, how they think, what their temperament is, what they are willing to talk about, the depth at which they're able to answer questions or sometimes the shallowness with which they have to resort to. and this event could not have met those standards more perfectly. we learned a lot. i think we improved the already good public conversation about air force acquisition and we learned more than even i who has known andrew for a while knew about the temperament and the brain of the assistant secretary of the air force for acquisition technology and logistics. so thank you, andrew.

a final word? andrew: i just want to talk a little bit about the people that we have in air force acquisition. because they talk process, you can talk all the technical stuff and you can tend to gloss over the people. we have amazing professionals in air force acquisition. they blow my mind on a daily basis. and it's a tremendous honor to work for them and to lead them. we are going to talk about areas where we need more technical expertise in our force and we're going to get it. we're going to develop it. we're going to flurriture it. and we're going to make that happen -- flurriture it and we're going to make -- nurture it and we're going to make that happen. that's not to suggest that the existing work force isn't kpefrplary because they really are. when i came to the job i was wondering if i was going to have a lot of work to do and i came in the door and found that eye-watering work was already under way and being done. it was being led by air force professionals. having said that, we have it in pockets that are incredible. there are other parts of the

system that probably aren't at the same stage of advancement. so we're also going to make sure we spread that goodness from our pathfinder organizations out to the rest of the enterprise. but i couldn't be more pleased with the quality of the folks that you have working for you in your air force doing acquisition. steven: that's worth saying and shouldn't ever be taken for granted. thank you very much. [applause] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] [captions copyright national cable satellite corp. 2024]

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♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪ lisa welcome to the stage board member vice president of global government relations. >> bright light spread hi everyone, that was not very good applause are you all asleep after lunch? come on. [applause] welcome everyone. it is great to have you here. my honor to welcome you here to the policy summit my name is kristen i run global government

relations. i am very proud as well to serve on the board of directors. this is a great crowd we have here today i don't think everyone is all in from lunch everyone is chitchatting a little bit which is okay. we also have a lot of people online. over 1000 people registered to participate in this. which is awesome, very exciting that is testament and tech policy today. it's not a surprise or such interest concerning the level of speakers we have today. it's never a dull moment. there is no exception to that right now. this year is been a landmark year for innovation. the generative ai exploding onto the scene and grabbing everyone's attention much to some of our dismay here 10 congressional bills each year for the next 10 years.

it's an important inflection point men of the issues we are working on may truly determine the course of our future. it's a fitting we've taken advantage of the opportunity presented by state conference to bring together smart minds from all different backgrounds, professions and opinions to tackle these topics head on. so today we are going to be taking stock of some that majorr tech policy milestones that have transpired over the past year. we will the ai order known to some of us is the gift who never stops giving. the very people setting the vision for ai in the u.s. federal government. we will also get an update on how the chips in science act is impacting main streets across america. cybersecurity ai in particular stand at the forefront of today's digital landscape.

around the world the current state of cybersecurity reflects an ever-growing need for robust measures to safeguard our digital infrastructure. with cyber threats and increasingly sophisticated attacks continuing to pull over for a rate including the use of ai the imperative for collaboration viewed the public and private sector has never been more apparent. which is why it, someone has been the cybersecurity world for many years i will not admit how many infants very large audience. i am thrilled we will hear today from not just one, but two of the world's most for most security leaders this afternoon. i have the pleasure to meet one of them backstage a few moments ago the national cyber directorate harry coker will be taking the stage momentarily. i have been lucky to have had the opportunity to a tent and host many forms as have you and work with trade associations over the years and i can tell

you this event in this organization really do stand apart. iti is truly comprehensive on tech policy covering the full tech waterfront of policy issues. and truly global. with the tremendous benefit the other 979 member companies these member companies many of whom are with us here today and the room. great to see all of you here, welcome it. our veritable who's who of top tech talent from across the rope so welcome we are glad to have you all here. i want to give a special welcome europe, asia, australia, south america, or anywhere else we're really glad you're here with us today as well. of course this event would not have been possible without the generous support of our sponsors and member companies. let me give special thanks

cognizant ericsson, mastercard, meta, organization nielsen sage, salesforce. for their sponsorship of today's program. i will now ask you to silence earphones, turn off your ringers but do not put them away. we'll invite you to share the experience with your audiences. tweet, post, gauge on social media however you would like. as we move through today's program. you will find us on twitter iti underscore tech tweet. # intersect 2024 so go ahead and post away all day long please. will also be doing digital poles throughout the program you will need your phone to participate in those. you will see instruction showing up on the screen as we go.