it's modeled on the national counterterrorism center created after 9/11 to foster sharing of terrorism related intelligence. white house cybersecurity and counterterror and terrorism adviser lisa monaco discussed the agency at the woodrow wilson center in washington d.c.. this is an hour. >> good afternoon. we have an overflow audience inside this room. obviously lots of cameras

beaming this offense to places far and wide and we have an overflow room as well because the wilson center is truly honored to host this event. i am welcoming some of our nearest and dearest supporters pretty thank representative jim himes of connecticut will be here or is here. i am jane harman the president and ceo of the wilson center. 15 years ago a disgruntled australian contractor hacked a sewage control system in queensland spilling millions of gallons of waste onto public lands it into public waters. all it took him then was a laptop and the a radio. today our infrastructure is increasingly networked rail switches water mains power grids. americans lives are more vulnerable than ever to digital disruption. the hacker black market has flourished. you can buy zero days for a song

song. a would be cyberterrorist who aren't limited in resources anymore. it's creativity. crafting a secure internet in securing america's place in cyberspace is a huge technical and leadership challenge. it's our digital apollo program. here at the wilson center we have invested intellectually and cyber. we think ahead of the new cycle to focus on the digital security risks posed by nonstate actors. we are attracting key scholars to study the challenge from all angles. we are regular hosting off the record dialogues and we are very grateful to hear today from one of this administration's senior leaders on cybersecurity issues. i often say if you want to get the job done right put a woman in charge. while this case let's give a shout-out to three. number one caroline krinsky who came to us from the basement of the white house. she had to adjust to the fact

that we had when does with real sunlight coming in. number two to ned king who is my right hand woman and ahead of our cyberinitiative at the wilson center and building our capacity and enormously and number three is lisa monaco security adviser to the president who is here to discuss the administration's cyber cyberstrategy. lisa has the worst job in washington and one of the most essential. we are glad to give her an hour's escape today at the wilson center. people pay lip service to the cyber challenge. lisa livesay. before this job lisa was the first assistant attorney general for national security who happens to be a woman. she clearly got excellent training for her various positions at the start of her career as an intern with the wilson quarterly.

from our point of view this is a homecoming and it comes as both the white house and congress are seeing where they can have a significant impact on the enormous cyber challenge. obviously the administration has a crucial role to play directing the department of homeland security to partner with the private sector. there is some real progress there. shaping standards and using the bully pulpit to build trust between key cyber constituencies. the white house has tried to move forward in the absence of congressional action by issuing executive orders and lisa is here today to announce a new center similar to the ones we have for counterterrorism and counter proliferation. the hack of anthem insurance last week highlighted how urgent these efforts are. anthem joins a long list of high-profile hacking victims sony target, jpmorgan and

even the background check contractors for the department of homeland security are lead agency on cybersecurity. so once again we are thrilled to have the main man in the white house on these issues, lisa monaco. she is a rosen center alum and homeland security adviser to president obama counterterror man -- counterterrorism adviser, both. it takes a woman to get the job done right. please welcome lisa monaco. [applause] >> thank you very much jane for the very kind words. it is very nice to be back. as jane mentioned my first job in washington post college was here at the wilson center when it was a paper quarterly. now of course like everything it

has gone digital. before i get to my main topic today though with your permission jane i would like to say a few words about the very sad news of this morning. it is with deep sadness that we have confirmed the death of kayla gene mueller. today our hearts go out to her family in my thoughts in particular are with her parents carl and marcia mueller who have shown such grace and strength and dignity over many difficult months. my thoughts are with carl and marcia kayla's brother eric and the rest of her family because kayla represented the best of us us. her generous. and her legacy of compassion and her selfless works for those in need should serve as an inspiration to all of us.

so thank you again jane for having me and i want to thank those of the wilson center for hosting me. the job that i hold as jane i think rightly observed is one that normally keeps me in the basement of the white house. i say usually it's nice to get out because i get to see the sunlight but they didn't have any windows in this room. as the president's homeland security and counterterrorism adviser i briefed him every morning on the most significant destructive and frankly horrific threats facing the american people. i'm oftentimes asked the president reminds me the bearer of bad news. since i began this job two years ago i can tell you an increasing share of the bad news that

deliver is unfortunately on cyber threats. in just the last nine months we have seen a growing list of high-profile targets. home depot, jpmorgan chase target sony pictures centcom and the u.s. postal service to name just a few. we are at a transformational moment in the evolution of the cyber threat. the actions we take today and those we failed to take will determine whether cyberspace remains a great national asset or increasingly becomes a strategic liability and economic and national security strength or a source of vulnerability. so today i want to talk about the threat we face and the administration's approach to countering it, drawing on counterterrorism lessons learned from the last decade of war. and let me start with the facts.

according to a recent united states government assessment cyber threats to our national security and economic security are increasing in their frequency, in their scale, their sophistication and the severity of their impact. the range of cyber threat actors methods of attacks targeted systems and victims are expanding at an unprecedented clip. the pace of cyber intrusions have also ticked up substantially. annual reports of data breaches have increased roughly fivefold since 2009 and the seriousness of those breaches is causing significant economic damage. no one it seems is immune from health care companies as jane mentioned and universities to the tech industry critical infrastructure and the entertainment structure.

just last week as has been noted anthem, one of the nations largest health insurance providers announced hackers had breached the database containing the personal information of 80 million customers and employees. inside the united states government we know that states and nonstate actors, terrorists, hackers and criminals are probing our networks every day seeking to steal, to spy, to manipulate and to destroy data. at the state level threats are coming from nations with highly sophisticated cyber programs including china and russia and nations with less technical capacity for greater disruptive intent like iran and north korea. several nations regularly conducts cyber economic espionage for the commercial gain of their companies and politically motivated attacks are growing and they are a

growing reality as we saw with north korea attack on south korea and its banks and media outlets last year. as for nonstate actors originating from profit motivating criminals so-called hackers for hire, those who would steal your information and sell it on line to the highest bidder. transnational criminals use cyber as investors for-profit and there are of course the ideologically motivated hackers and terrorists. we have groups like anonymous that thrive on creating disruptions on company's web site and leaking personal information on line. you have groups like the so-called syrian electronic army which conducts cyber attacks in support of the brutal regime in syria and then there is isil, which has harnessed social media for propaganda machine that is

radicalizing and recruiting young people to their hateful message around the world. most concerning on the cyber front perhaps is the increasingly destructive and malicious nature of cyber attacks as we saw with sony pictures entertainment last fall fall. this attack stole large amounts of data and rendered inoperable thousands of sony's computers and servers. it was a game-changer because it wasn't about profit. it was about a dictator trying to impose censorship and to prevent the exercise of free expression. at bottom it was about coercion which the united states believes is unacceptable and which is why we took the extraordinary step of publicly identifying north korea is responsible for the attack and responding swiftly,

imposing additional sanctions on kim jong un's regime. in short, the threat is becoming more diverse, more sophisticated and more dangerous. and i worry that malicious attacks like the ones on sony pictures will increasingly become the norm unless we adapt quickly and take a comprehensive approach just as we have in other contexts which brings me to the counterterrorism model. now to be sure there are many differences that make it difficult to apply all of the lessons learned from the counterterrorism experience to the cyber round. for one the private sector plays a more central role in spotting and responding to cyber incidents than it does in the counterterrorism realm where the government largely takes the lead. but having observed the nation's response to terrorism from 9/11

to three different purchase and united states government as the fbi as the assistant attorney general for national security at the department of justice and now the white house i can tell you that there are structural organizational and cultural shifts that were made in our government in the counterterrorism round that also apply to cyber. we need to develop the same members in the government response to cyber threat as we have for terrorist incidents. structurally since 9/11 our government has done the very hard work of breaking down walls in our counterterrorism agency and bringing people together to share information so that we get the best possible assessment of the threats. whenever possible we are bringing partners together to share information and to extend our operational reach. this model has made our counterterrorism mission against

an evolving enemy more effective and more sustainable. like counterterrorism meeting cyberthreats requires a whole of government approach one that uses all the appropriate tools available to us including global diplomacy, our economic clout, our intelligence resources, our law enforcement expertise, our competitive technological edge and when necessary our military capability. those who would do us harm should know that they can be found and they will be held to account. in the cyber context we need to share threat information more broadly and to coordinate our actions so that we are all working to achieve the same goals and we have to do so consistent with fundamental values and in a manner that includes appropriate protections

for privacy and civil liberties. we need to sync up our intelligence with their operations and respond quickly to threats against our citizens, our companies and our nation. make no mistake over the last few years we have developed new and better ways to collaborate across all levels of our government and with our partners in the private sector including at the operational hubs in our our government that are charged with monitoring threats, issuing warnings, sharing information and protecting our critical infrastructure. at the white house we have taken steps to improve our policy response. last summer following a wider number of breaches and intrusions to public and private networks, we created what is called the cyberresponse group or the cr g.. we know it's official because it

has an acronym. the crt is modeled on the very effective, highly effective and long-standing counterterrorism security group. like its terrorism and log, the cr g. contains the interagency and pools knowledge about ongoing threats and attacks and coordinates all elements of our government's response at the highest level. but despite this step and other steps on the progress we have made it has become clear that we can do more as the government to quickly consolidate and analyze and provide assessment of fast-moving threats or cyber attacks. as president obama said during a state of the union last month we will make sure our government integrates intelligence to combat cyber threats just as we have done to combat terrorism. so today i am pleased to announce that we will establish

a new cyber threat intelligence integration center under the auspices of the director of national intelligence. now currently no single government entity is responsible for producing coordinated cyber threat assessments ensuring information is shared rapidly among existing centers and elements of our government supporting the work of operators and policymakers with timely intelligence about cyber threats and threat actors. it is intended to fill these gaps. in this vein, it will serve a similar function for cyber as anand national counterterrorism center does for terrorism. integrating intelligence about cyber that's providing all source analysis to policymakers and operators and supporting the work of existing federal cyber centers network defenders, law

enforcement communities. the cpic will not collect intelligence. it will analyze and integrate information already collected under existing authorities. nor will the cpic perform functions assigned to other centers. it is intended to enable them to do their jobs more effectively and as a result make the federal government more effective as a whole and responding to cyber threats. cpic will job on the existing cybervendors to integrate their expertise and information to improve our collective response to cyber threats. now responding to today's threat is only part of the task. the real challenge is getting ahead of where the thread is trending. that is why the president's national security strategy identified cyber as a critical focus area to ensure we meet the

challenges of today and prepare for the threats we will face tomorrow. the president's budget backs up this commitment with $14 billion to protect our critical infrastructure, government networks and other systems. and later this week at stanford university president obama and i and several cabinet members will join hundreds of experts academics and private sector representatives for a first of its kind white house summit to discuss how we can improve trust trust, enhance cooperation and strengthen america's on line consumer protections and cyberdefenses. but to truly safeguard americans on line and enhance the security of what has become a vast cyber ecosystem we are going to have to work in lockstep with the private sector. the private sector cannot and should not rely on the

government to solve all of its cybersecurity problems. at the same time i want to emphasize that the federal government won't leave the private sector to fend for itself. partnership is a precondition of success. there is simply no other way to tackle such a complicated problem. it requires daily collaboration to identify and analyze threats, address vulnerabilities and then work together to respond jointly. to the private sector we have made it clear that we will work together. we are not going to bottle up intelligence. if we have got information about a significant threat to a business we are going to do our utmost to share it. in fact within 24 hours of learning about the sony pictures entertainment attack the u.s. government pushed out information and malware signatures to the private sector to update their cyber defenses so they could take action.

we want this flow of information to go both ways. the private sector has vital information we don't always get unless they shared with us and the government has unique capacity to integrate information about threats including with non-cyber sources to create the best possible picture to secure all of our networks. when companies share information with us about a major cyber intrusion or potentially debilitating denial-of-service attacks they expect us to respond quickly. we will provide as much information as possible as much information as we can about the threat to assist companies in protecting their networks and their critical information. we will coordinate coordinated quick and unified response from government decks her -- experts including those of the department of homeland security and the fbi. we will look to determine who the actor is and to hold them to

account and as we respond to attacks we will bring to bear all of the tools available to us and draw on the full range of government resources to disrupt threats. i want to commend companies that have shown strong leadership by coming forward as soon as they identify breaches and seeking assistance so we can work together to address threats more rapidly. this is good for the company it's good for the consumer and it's good for the governor -- government. across-the-board we are tearing down silos, increasing communication and developing flexibility and agility to respond to cyber threats of the 21st century just as we have done in the counterterrorism world. moving forward as our lives become more and more dependent on the internet and the amount of territory we have to defend keeps expanding our strategy will focus on four key elements.

first, we need to improve our defenses period. in particular actively using the cybersecurity framework that was announced last year we have enabled every organization to manage cyber risks more effectively. even just employing basic cyber hygiene could stop a large percentage of the intrusions we face so we have got to start by getting the basics right. second we need to improve our ability to disrupt respond to and recover from cyber threats. that means using the full strength of the united states government not just our cyber tools, to raise the cost for bad actors and deter malicious actors. third, we need to enhance international cooperation including between our law enforcement agencies so that when criminals anywhere in the world target innocent users on

line we can hold them accountable just as we do when people commit crimes in the physical world. and fourth, we need to make cyberspace intrinsically more secure replacing passwords with more secure technology building more resilient networks and enhancing consumer protections on line. president obama will continue to do everything within his authority to harden our cyber defenses but executive actions alone won't be enough. we need durable, long-term solutions codified in law that bolster the nation's cyber defenses. this is not and should not be a partisan issue. the future security of the united states depends on a strong bipartisan consensus that respond to a growing national security concern.

everyone shares responsibility here including congress. in december congress passed important bills to modernize how that government protects its systems and to clarify the government's authority to carry out its cyber missions. today we need the congress to build on that progress by passing the baggage of cybersecurity measures that president obama announced just last month that encourage greater information sharing sets a national standard for companies to report data breaches and provide law enforcement with updated tools to combat cyber crimes. and we look to congress to pass a budget with critical funding for cybersecurity including at the department of homeland security. the administration is ready to work with congress to pass these measures as quickly as possible. cybersecurity is and will remain

a defining challenge of the 21st century with more than 3 billion internet users around the world and as many as 10 billion internet connected devices. there is simply no putting this genie back in the bottle. we have got to get this right. our prosperity and security depend upon the internet being secured against threats reliable and our ability to access information, open to all who seek to harness the opportunities in the internet age and interoperable to ensure the free flow of information across networks and nations. we are at a crossroads and the clock is ticking. the choices we make today will define the threat environment we face tomorrow. all of us have a responsibility to act to practice better cyber hygiene to build greater resilience of our network so we can bounce back from attacks, to

break down silos and improve information sharing as well as the integration and analysis of threats to pass cybersecurity legislation to ensure that we take a comprehensive poll of government approach to respond to cyber attacks just as we do other contexts. these are hard and very complicated issues but i am confident that working together government industry advocacy groups the public and the congress, our networks can be safer privacy protected and our future more secure. i look forward to tackling these threats with all of you. thanks very much. [applause] >> we so thank you for a very comprehensive remarks. i'm going to ask a few questions and have a conversation and then

we will open to a conversation from his room and from the overflow room. i hope somebody will give me questions from others that are outside of this room. first of all i know this is a recovering politician you're gentle pitch to congress on a bipartisan basis and i hope congress is listening it has occurred to me for years that the terrorists won't check our party registration before they blow us up. this is obviously chair in the cyber realm as well. the attacks on all of the infrastructure that you have listed not just the private sector but the postal service and so forth didn't target democrats or republicans, did it? >> no it did not. >> i hope everyone congress is tuning in and realizing there is more to do to you name the list of things that congress has to do, more information sharing,

standard settings and tools in law enforcement but you didn't mention community. is that adequately dealt with or does moore didn't have to be done there and can you explain to this audience? >> is a central feature of the package of measures that president obama announced last month and it goes directly to the heart of the first on the list that was reported there information sharing. the president's legislation he announced last month makes it clear and proposes to provide liability protection for sharing from the private sector with the government to the department of homeland security and in order to incentivize the private sector to provide that critical information that is talked about in my speech. >> not everybody is a lawyer so why would someone be liable for sharing information. >> i am a recovering lawyer as you know, as it's been noted but

as we have heard from industry across-the-board small medium and large businesses that they face real choices and concerns about sharing information about breaches or hacks or intrusions into their networks. they want to share information with the government about the origins and what they found out about those breaches but in doing so there are concerns that the information they provide could include consumer information or they could be sued for seeming to include consumer information. so what the president's proposal does it says straight out provide liability protections targeted and narrowed liability protection for the purpose of a corporation, providing that computer security and private security information to the government after taking reasonable steps to remove

private information, consumer information so the government can get that information and look at it, compare it and analyze it along with all the other sources that the government has and return that information to the public sector, to the private sector, state and local government and the private sector holders of a huge approaching 85% of the cyber --. >> i was going to go there but let me ask one follow-up question so everyone understands what you are saying. the reason they should tell the government about this is what in the information will be used how? >> we may have seen exactly that signature, that set of 120 that a particular malicious cyberactor uses to do its destructive denial of service or

other attack that goes to the integrity of data so we made once we looked at it and put it together with all the other intelligence information we had the may say we know who this is we know what it is and we know how it's going to vector system and most importantly we want to tell everybody else. we want to tell the company that provided us and provided that information to us is a power plant producer or owner, we want to get it out to the rest of the sector. >> so when company axe comes forward and is protected in a limited way for doing so company x benefits. >> company x benefits. >> in addition to company axe being patriotic to help the rest of the internet great. >> this is why talk about an ecosystem. we are all intertwined as you noted in your remarks.

one person's vulnerability frankly is everybody's vulnerability. so that is why it's so critical that we are working together. >> i don't think there is a lot of pushback from congress on the immunity issue so why isn't congress doing something? >> this is what we are really hoping we can galvanize the congress to act because once you compare the liability protection in the way we have described with reasonable privacy protections this ought to be the kind of thing that we can get behind on a bipartisan basis. >> the other thing i want to draw you out about and again i don't think there is a lot of public understanding of it is the portion of critical infrastructure in the private sector. people should be aware that there is.mil an intersection --

a system for the military.gout system for our government and then there is dot.com. how many people here have some sort of an internet account that ends in.com back? how many of you are clueless? clueless people don't come to the wilson center. lisa can you talk about the percentage, let's start with critical infrastructure and widely being the private sector with inadequate tools exposes all of us? >> you know like most statistics they are all over the place but by any measure there are references to 85% of critical infrastructure and the backbone on which we ride whether you are power plant, a financial company, whether you are a shopping center. all of that the vast majority

that resides in the private sector. and local government or privately-owned. that means that the dot gout piece or the dot.mil that is controlling united states government is a small portion and so we are incredibly reliant for all the services we rely on that are critical in many instances to our life and sustenance whether it's a hospital or financial bank account you are vulnerable if you are hooked up to the internet. >> in my brilliant introduction i referred to rails, water mains and power grids. what percentage of this is in the private sector? >> all of it. >> did everyone hear that? >> privately-owned. it's not the federal government responsibility. it doesn't come under the control of the federal

government and in any event if you are hooked up to the internet you are vulnerable. my former boss and somebody you know well jane former director of the fbi robert mueller said it has been quoted often there are only two types of company owners those who have been hacked and those who will be hacked. >> the wilson center has been hacked and we are pretty careful about things. we are taking precautions every day. has anybody here ever had an experience being hacked or has anybody here not know someone who has been hacked? all right yes one person. we are going to call on you later and so you can explain how you are so lucky. moving along something we brag about at the wilson center is how good our people are and that is of course we are in this think tank in new york.

my question is about how good are the people the government can hire to work on cyber issues and i ask this because i'm well aware and i know everyone here is that the private sector pays much richer salaries. >> we have the same i should say greater recruiting and retaining challenges that the private sector has. now we can offer something jane that the private sector not all the private sector can and that is obviously a tremendous sense of mission but we have got to do more to be able to hire top-notch cyber talent. we have got tremendously talented people working in the nsa, the fbi and the department of homeland security and in the defense defense department. these folks are top notch but they also can be hired away for

vast sums. >> so what do we have to do to get these people to come and stay and by the way is that the nsa recently been briefed on some aspects of our programs and they said really good kids coming out of college are turning down much bigger salaries because they are patriotic and they want to protect our country. >> we have a sense of mission that we can offer and that is a huge recruiting tool but we need the funds and the authorities and the flexibility and particularly the department of homeland security to be able to do that extra hiring. this is the wave of the future. >> is another obstacle to hiring some of these kids are clearance system? >> well look there are always ways we can do better to streamline the security clearance system. as the president's counterterrorism and homeland security adviser you are never going to hear me say anything that would seem like we are scrimping on security but there

is more that we can do to streamline that process and to get people in who are patriotic, who have huge skill sets in who we can put to work. >> obviously we are not encouraging any more edward snowden's to apply, we all got that message but what about a kid that incorrectly downloaded music for free which is not okay okay on one of his systems? >> not having recently gone through my security clearance although i've had many, i didn't have that question but look what i would encourage those who are patriotic the first thing is to be honest on your security clearance form but something that is a crime is something we have to talk about.

>> the last question for me and we will have 20 minutes for audience questions is about the only criticism i have heard since news you have heard here that was printed in the newspaper this morning. that's okay, as long as you came here to deliver the speech we are very happy that the criticism is that you are building in a necessary prerequisite with cttic. what is your answer to that? >> my answer to that is look, if they laid out in the speech this is filling a critical gap. the and ctc, the national terrorism -- counterterrorism center did nothing to take away the mission role or responsibility of cia's counterterrorism center of fbi's joint terrorism task forces or siop which is its operational hub. those are operational arms and centers that have clear

responsibilities into their mission. what we need and the gap that cttic fills is critical coordinated intelligence to seek those operations. i think what we have seen with and ctc in the terrorism realm is operators and policymakers are very well served in facing an evolving threat by having a source of rapid integrated intelligence at their disposal. >> expressing my personal opinion i was there when the terrorist threat integration center was set up by president bush and that it was renamed and ctc and then congress codified and ctc as part of the 2004 intelligence reform law and i think and ctc is terrific. a shout-out to the people who work there. if you're building something comparable to that is going to work as well is that my own view is you are on the right track.

>> will thank you we think so. >> all right folks 18 minutes and 40 seconds. please identify yourself and ask a question. do not give a speech. right here. where is the microphone? >> thank you. pete with energy wire. can you elaborate on the second of your core action points? how can the government use all of its capabilities more effectively to disrupt serious threats to critical infrastructure before they occur? >> is a very good question. what i meant by that and the reference of the speeches using all of our tools. again the terrorism model is instructive. we get around, literally get around this situation. our diplomats are intelligence community are military or law enforcement officials and we discussed what is the best way

to deter this to determine how to adjust the threat. you see us using all of those tools, diplomacy in trying to work with other governments to establish cyber norms and behavior on the military side on the intelligence side and the law enforcement side. as last spring the department of justice, the national security division something i know a little something about, brought an indictment against five members of the people's liberation army in china for conducting cyber economic espionage in this country. that is an effort to say we will take account of these actions and determine who has committed cyber actions and go after them.

we see that in a response to the action in north korea. the idea is you are going to look at all of your cyber tools and look at all of your tools including your cyber tools in determining which is the best one. >> it's your policy not to do economic espionage. could you explain the basis for that? >> sure in the president has been quite clear about this. we are not conducting and will not conduct economic espionage for the benefit of our company full stop. that is what the president said and that is what the intelligence community is going to do. >> a question on the side. >> day from politico. can you discuss where the personnel for the center are coming from? is a coming from existing agencies or are you simply cannibalize and federal

authorities for federal capabilities? >> the answer to that is no to the cannibalization. >> the government doesn't cannibalize. >> the idea here is as jane referenced we have got authorities and this is the reference in the parallel to the and ctc. the director of national intelligence has authorities under the terrorism reform intervention act that was passed after 9/11 to create intelligent centers specifically for this mission to integrate and bring all sources of intelligence together. so yes as and ctc does cttic withdrawn expertise in intelligence and analysts from other centers and from other government agencies who have the national security responsibility in the cyber responsibility.

>> we actually promoted that idea is part of intelligence reform because it brings people broader experience and they are able instead of being a silo where they don't see the whole picture and to do a more whole of government response which is something i would assume you are trying to achieve. >> that's exactly right it's a really good point. in the intelligence community and analyst someone who serves in the intelligence community to get promoted you have to have done something called joint duty. this is tremendously smart innovation. you have to serve another agencies and see what your partners in the intelligence community do and this can be part of that. >> by the way is also a strategy for the military. goldwater-nichols was passed in the 1980s created the joint structure we have with the chairman of the joint chiefs and the whole notion is pulling people together you have a better chance of bringing the best capabilities together.

rightup here in the third row. >> claire casey. i designed to comment on the december attack. is this the beginning of a new beginning of the new arab cyber attack which is causing damage to particular people and does that change the game and do we have the right tools for that. >> you are onto something and i spoke critically to in my speech speech. the north korea attack on sony entertainment was a game-changer because it was both destructive and coercive. we saw in 2012 and attack, a destructive attack on saudi aramco a large oil facility. 30,000 computers turned into bricks basically. this is incredibly destructive. obviously and it has a huge impact on an economy's bottom line.

that is the thing as i said in my speech that is probably the most concerning to me, that and what i would say is another element of destructive cyberbehavior. it manipulates leaving an impact that makes us question the integrity of data when you don't know what is has really happened so you lose trust in saving the data that is fair. >> right in the center here. >> as you mentioned the -- for an international corporation. are there any plans at the white house has? >> is a great question and president obama has spoken to this when he talked about the sony pictures attack trade we

have got to do more work quite frankly on galvanizing international cyber norms, things like getting the international community to sign on to the fact that we are not going to commit a cyber attack on critical infrastructure another country state's critical infrastructure. this is something we can sign onto. >> this site on the aisle. >> steve come independent consultant. he said the fourth pillar was making the internet more intrinsically secure yet on the counterterror side law enforcement reaction to the default encryption from apple and google as well as secure messaging platforms for law enforcement here in the u.k. has been less than enthusiastic so how far does that pillar extend for intrinsically secure?

>> you use the word default encryption. please explain that other other people. >> with their latest release from google and apple on the iphone platform they have implemented strong encryption by default so that if the phone is compromised physically nobody can obtain data so your data is inherently secure and apple has no easy way or law enforcement has no easy way to recover it so that would support intrinsic security of our information interaction to law enforcement not having a backdoor into the security system has been very negative. >> erased two very important issues and i will take the consumer protection peace second because it's something we will be talking about later this week in stanford. on the first issue you raise referring to comments that director comey and others have have made and that president obama spoke about this recently

in his press conference with prime minister cameron. there's an incredible value from strong encryption, enhancing privacy protections that we all want. by the same token there is a real concern if we cannot have a legal effect to court orders that would allow law enforcement to have access to information or evidence that stopped a terrorist attack that stopped a malicious cyberattack that stops crying. we have got to have a dialogue about this. we have got to have an informed discussion. that is what director comey has called for and that is what the president has called for so i think you raise an important point about a dialogue that we do need to have. on the consumer protection peace which are quite obviously related these are one of the things we are talking about in tampa in a few days. talking specifically about consumer protection on line.

what are the new and next generations of payment systems that would move us past the password to multifactor authentication. other secure forms of payment whether it biometrics or using additional things that move us beyond the password until we get to more inherently secure payment system. >> let's go in the middle. your hand is still up sir and by the way of their questions from the overflow room someone needs to hand them to me in the near future. >> christian vector from the center for homeland security at georgetown university. you mentioned the key between the role of the cyprus not as a

collector or analyst of cybermax threads how are you envisioning cttic been different in terms of how it's organized and staffed and so on? >> the distinction i was trying to draw is obviously in the terrorism realm and the homeland security space we have this ethos, see something, say something which is tremendously important and that is geared at the public sector. it goes to the issue which is because so much of our critical infrastructure and are the structure is in private-sector hands we are relying in large measure, in significant measure on about vulnerabilities and attacks that happen in the private sector. so that has a state at least under a proposal that the president announced last month

which is to say if you are a company and you find that you have been hacked or there has been a breach provide information to the department of homeland security to its national communication cybersecurity center, the nccic who is set up to be a network defender and to engage physically with the private sector, get that information. that will then be shared appropriately with the rest of the federal government cybersecurity apparatus to include the new system. cttic can compare their private-sector information along with codified intelligence and other information that we in the government uniquely have so the idea is to get a two-way street going where the private sector brings in information, we use it and put it back out. >> i assume you will as soon as you have thing up communicate how to be in touch with it. what safeguards do you have

against people putting this information to the system? >> this is the type of thing we are talking about in the proposal that the president announced last month which was to say you are private corporation we wanted to provide that information. we want you to take reasonable steps to ensure that you are not a giving the government private personally identifying information and you are not providing malicious information. so there is a responsibility also to take those privacy enhancing steps. >> i get that. you work for target and you're trying to indicate the right information. what if you don't work for target and you pretend you do and you are communicating information? >> that is why we want that information to come into the department of homeland security to set up to ensure that we are not going to be propagating

malware or malicious code so we don't have a vicious cycle. >> and one more question while we are on the subject. the black market for malware is growing. please do not tell us precisely what you are doing about it because people will work around that but can you ensure is that you were doing all the right things in finding and getting rid of the exploits in the malware that is available for sale for cheap on the black-market? >> as you said this is something we are very focused on. this hacker for higher approach are the criminal networks that can and are behind a lot of this malicious cyber activity is something we are very focused on and it's not something people should be addressing. >> we will take to last questions together together because we are out of time. one is back there, the blue shirt. stand up. >> thanks.

forbes.com today as saying its web site was hacked by apparently chinese hackers who are targeting financial services firm of forbes.com as well as u.s. defense contractors. what can you tell us about that particular event in the mite of done it in the technique of hitting third-party web sites with an eye towards capturing the eyeballs of going to that web site. >> hold that thought. >> my name is tender with the european parliament liaison office and i continue to hear about the need for international cooperation but i have yet to hear a realistic framework. what is the response or how can you detail at? >> this issue of having norms and garnering international support is something something the president and prime minister

cameron talked about in terms of enacting a cyberworking group to address particularly hacks and breaches into the financial sector so those types of partnerships and garnering international support for a set of norms is something that i think it's something we really do need to focus on. with respect to the gentleman's question in the back i can't tell you anything about the breach of which you refer. i would say though it sounds like not having been briefed yet on that it, it sounds like exactly the type of thing that we are going to continue to be concerned about and we are going to see more and more of which is exactly why we need c. -- something like cttic to bring in that information. rapidly and say saves the something we have seen before and get that information back out for the benefit of the private sector as well as united states government. ..

and again, thank you for the analysis. >> thank you for your service. [applause] [inaudible conversations] >> next on c-span2 the white house and congress reacts to react to the killing of american hostage kayla mueller. the senate armed services committee holds a hearing on global security threats and white house advisor discusses the creation of a knew agency focused on defending against cyber attacks. >> representative martha mcfaul he member of the

armed services she will discuss the president's request for the use of military force against isis and the conflict in eastern ukraine. then more about the president's request founder and cochair of the congressional ukrainian carcass to talk about her groups call for military -- military assistance to ukraine. later historical black colleges and universities continues with president of morehouse college in atlanta live every morning at 7:00 o'clock eastern on c-span2. you can join the conversation with phone calls and comments on facebook and twitter. >> here are some of our featured programs for this presidents' day weekend.

they worked with kayla and her short life. life.

somebody a dedicated her life to serving others. not to serving other people, but serving those who were in crisis situations and faced dire circumstances and were relying on the generosity of fellow human beings to meet their needs. a young woman he was willing to put herself in harms way to try to offer that release. as a way to honor the guy that she worshiped. indicate that i was personally moved by her comments that she saw god in the eyes of people who are dealing with terrible crises a particularly profound statement from such a young woman but i think it goes to the character and generosity of spirit that she embodied. over the weekend kayla's parents received a private message from her captors

with additional information about her death. that information was shared with the intelligence community. they conducted a review and analysis and after that analysis was completed they concluded that kayla has died. the information they review did not allow them to arrive at a conclusion about her precise cause of death but it did allow them to conclude that she had in fact died. >> any information about when she died? >> that is a good question. i do not believe they were able to arrive at any conclusion about the timing precise timing of the death. >> whether she was killed.

>> those claims. again, the intelligence community to not have a specific assessment about the cause of death. >> this is something that military officials have communicated as well. the air strike that was out by the royal jordanian air force was against an isa weapons compound that group maintained your syria. a facility that had been struck on previous occasions and was not unusual. >> the facility had been damaged. it is not unusual for sex like this to be carried out. the information that we have is that -- and we have this information because the airstrike was coordinated with the united states military. there is no evidence that civilians in the target area prior to the coalition strike taking place.

>> regardless of her cause of death they are responsible. the organization that was holding her against her will they are responsible for safety and well-being and therefore are responsible for her death. >> the house speaker issued a statement saying the tragic death underscores the brutal nature of the enemy we face. a group of terrorist ties that has brought medieval savagery to the 21st century. the senators the senators from her home state of arizona spoke about her killing. you those comments. >> taking this opportunity to express sorrow.

the people of arizona, the news news that one of our own has died at the hands of iso-. age of 26 dedicated to the service of others. when she was taken hostage in 2,013 she was leaving a doctors without borders hospital. she she had been in the region working with syrian refugees. she once said that what inspired her work was that she found god in the eyes -- god in the suffering eyes reflected. regardless of the exact circumstances the fact remains that had militants not kidnap the sparkling and woman she was still be with

us today. her death can and should be laid squarely at their feet and is yet another example that this group's mindless, alarming savagery. the best thing congress cannot do is authorize the mission and let our allies and adversaries know that we mean business and that we are united in our resolve. we should remember her not for her death but for her life and for her devotion to the highest calling dedication to the service of others. our deepest heartfelt condolences go to her family and loved ones. i rise today to mourn the tragic death of 26-year-old 26 -year-old humanitarian aid worker kayla g mueller of prescott, arizona who have been held by terrorists in syria since august of 2,013.

lee and i are heartbroken for the mueller family at the loss of the beautiful, beloved kayla. thoughts and. thoughts and prayers are with the people of the home state of arizona, the country, and the civilized world. i i want to take the time today to share a bit of her story. the best of us a remarkable impact on the lives of so many people who never have the honor of meeting her. her story will forever be an inspiration to us. attended high school at tri-city college prep. received the presence award for academic excellence and 2,007. the community foundation 2,005 and the gold presents

a volunteer award of 2,007 for her volunteer efforts with youth count, americorps america's finest, opened end end for troubled youth, big brothers big sisters and other organizations. after graduating from northern arizona university kayla committed her life to helping people in need around the world. world. first in india, then israel, the palestinian territories and back home where she volunteered at an hiv aids clinic and a woman shelter. but it was a conflict in syria. sparked her desire to help those in need. a youtube video she made in october 2,011, the syrian civil war was just beginning

i am in solidarity with the syrian people. i reject the brutality and the killing that the syrian authorities are committing against the syrian people. i declared my participation in the syrian sit in on youtube. december 2012 travel to the turkish syrian border where she worked for months helping of thousands of syrian refugees whose lives were torn apart by the humanitarian catastrophe created by bishara al-assad and the syrian civil war. according to her family kayla found this work heartbreaking but compelling extremely devoted to the people of syria and their struggle. the struggle. she explained to her family a call to service in this way. she said, i find god in the suffering eyes reflected in

my. if this is how you are revealed to me this is how i will forever seeking. i will always see god. some people some people find out in church. some people find god in nature. some people find god and love. i find god and suffering. suffering. i have known for some time what my life's work is. using my hands as tools to relieve suffering. kayla travel back home to visit her family in arizona in may 2013 and spoke about her experiences at the club where her father was a member. after recalling helping a syrian man and his wife had been murdered to reunite with the six-year-old relative he was desperately searching for after the refugee camp was bombed kayla said, the story is a

reality for syrians to one half years on. when they here i am an american they ask, ask where is the world? all i can do is cry with them because i don't know. after spending after spending time with the refugees kayla told the club that she was totally john and and that she can't do enough to help. she recalled stories of children being hurt by unexploded bombs women forced in the early marriages, elementary schools targeted for bombing by the syrian regime and people living in caves syrians are dying by the thousands for the rights that we have. as long as i live i will not let the suffering be normal

something we just accept. it is important to stop and realize what we have know why we have it she described to describe your work helping the syrian children and the refugee camps including trying, painting, and playing with the children from many of whom were badly scarred physically and psychologically. she said we give and get joy from playing with these children. half of the one and a half million refugees that the un is registered or children. in the chaos of waking up in the middle of the night we're hearing a more children being separated by the -- separated from their families by accident. the refugees that are known

to americans our nation would be more heavily engaged today the family released a letter written to them by kayla in the spring of 2,014. i want to read a bit of it to get a a sense of this young woman whose deep faith in god and profound love for family and her remarkable strength in the face of grave danger. danger. she wrote, i remember mom always telling me that all in all the only one you really have is god. i have come to a place and experience were in every

sense of the word i have i have surrendered myself to our creator because naturally there was no one else and by god and by your prayers i have felt tenderly cradled shown in darkness light and have learned that even in prison one can be free. i am grateful. i have come to see that there is good in every situation, sometimes we just have to look for. i pray each day that if nothing else we have felt a certain closeness and surrender to god and have formed love and support amongst one another. i i miss you all as if it had been a decade of for separation. she closed with these words. the thought of your pain is the source of my own simultaneously the hope of our reunion is the source of my strength. please be patient. give your give your pain to god. i know you would want me to remain strong. that is exactly what i'm doing.

do not fear for me. continue to pray as will i and by god's will we we will be together soon reflected on her life the commitment to work every day to honor her legacy. a compassionate and devoted humanitarian to dedicated the whole of her young life to helping those in need of freedom, justice, and peace. john to help those displaced by the syrian civil war. she 1st travel to turkey in december 2012 2012 to provide human terry and eight to syrian refugees.

she lived with purpose, and we will work every day to honor her legacy. our hearts are breaking but we we will continue on in piece, dignity and love for the people of arizona in the united states congress i want to express the deepest condolences to her parents the loving family and many friends. kayla devoted her young life to helping people in need around the world to healing the sick and bringing light to some of the darkest and most desperate places on earth. she will never be forgotten. mr. pres. i ask unanimous consent that a letter written by kayla from her

imprisonment to her family be included as part of the record. >> tomorrow intelligence and counterterrorism officials testify about the threat from homegrown terrorists and foreign fighters and a hearing of the house homeland security committee. live coverage at at 10:00 a.m. eastern on c-span three and c-span.org.

>> since a quorum is now present i asked the community to consider the nomination of doctor ashton b carter to be secretary of defense. if a roll call's requested we would be glad to have a rollcall. if not, is there a motion -- anyone who would like a rollcall vote? >> i don't know if we needed. >> we don't need it. >> i would like to be recorded. >> the clerk we will call the role. [inaudible conversations] [roll call]

[roll call] >> twenty-five yes to one no instruction.

>> the motion will be reported favorably. doctor carter's nomination to the effective after the senate hopefully we can get a vote perhaps as early as tomorrow. we will leave it open for senator sullivan to make his wishes known. i am sure that this committee meets today to receive testimony on our nation's nation's defense budget and priorities from bipartisan national defense panel. this group of former military leaders, members of congress and pentagon officials who served under republican and democratic presidents released their unanimous recommendations and report on our nation's defense strategy last year. we have we have with us today to distinguish members of the national defense panel which of whom served

as undersecretary of defense for policy. we are grateful for you to appear before us today. we would also like to thank the panel's cochairman for they're lead. the national defense panel bipartisan and consensus report is a compelling statement of the daunting strategic realities america faces in the 21st century. the. the rules -based international order that is further global prosperity and security is not self-sustaining and the challenges multiply around the world, there is no substitute for robust american engagement to ensure its preservation. though america has many effective tools of of global influence in clement -- including diplomacy and economic engagement the panel reminds us that all of

these are critical and are intertwined with an dependent upon the perceived strength, presence, and commitment of us armed forces. if you're a combination of self-inflicted wounds and dangerous geopolitical and technological trends american military strength is the strategic foundation undergirding our global lead is eroding. 487 billion in cuts to our national defense and billions more under sequestration constitutes a strategic misstep. these deep cuts have sharply reduced military readiness lead to dangerous shortfalls in present and future capabilities and prompted our allies and adversaries to question commitment and resolve. these cuts are not the product of any strategic assessment of the threats we face at a time of global upheaval. china's rapid military modernization is tilting the

balance of power in the asia-pacific. russia's aggression threatens europe regional security. iran and north korea continue the pursuit and development of tactical weapons, weapons, and violent islamist extremists are destabilizing large swaths of the middle east and north africa while plotting attacks against the united states and our allies in addition regional threats and structural trends like the diffusion of certain advanced military technologies pose new operation challenges to america's armed forces. in in the security environment of the future the panel's report predicts conflicts are likely to unfold more rapidly battlefields will be more lethal, operational sanctuary will be scarce and often fleeting asymmetric conflict we will be the norm the panel echoed secretary hegel who has said american

dominance can no longer be taken for granted. the panel remains the budget control x immediate repeal and return to at least the funding baseline proposed a secretary gates fiscal year 2012 defense budget. that budget represents the last time the department was permitted to engage in the standard process of analyzing threats estimating needs and proposing a resource baseline that would permit it to carry out the national military strategy.

the budget request and hundred and 12 billion more than the budget's. it's it's also worth remembering that secretary gates suggested this minimum level before russia's invasion before the rise of isis and the further spread of violent extremism across north africa and the middle east before china's coercive behavior in the east and south china seas have become dangerously commonplace. it is unacceptable to continue to ask the men and women of our military to put their lives at risk around the world will be cut back on training and equipment to sell domestic political scores. therefore the overriding priority of this committee in congress must be to return to a strategy driven budget and i look forward to the testimony by witnesses today as to what

the budget like. >> thank you very much. i also want to welcome our witnesses. the initiation of hostilities. they contend with the challenge of an unproductive of unpredictable and costly shifting nature of the world. we have seldom predicted where i went. however, the department of defense requirement to conduct planning. the national security interest. each qtr has had to make strategic or resource trade-offs. the work of the current national defense panel

provides an independent consideration of the department's assessment it's defense strategy and identification of the capabilities necessary. in essence the panel found that the 2014 quadrennial defense review and defense strategy makes a reasonable strategic assessment. the panel largely echoes the qtr strategic assessment and highlights the challenges the nation faces with emphasis on china, russia ukraine proliferation and north korea, iran, insurgency in iraq civil iraq, civil war in syria and instability throughout the middle east and africa. also in hours of the qtr cause the capabilities and capacities to address the challenges we face today. however the panel knows those capabilities and capacities clearly exceed the budget resources available and therefore undermine a strategy. it is no surprise that the

panel's overarching funding and regular of regulation regulation endangers the national security and calls for its repeal. the panel may increase defending, personnel costs and more budget predictability. in addition to the risks of sequestration our be interested to here the witness's assessment of other risks to our national security as well as risk * military and their families. after nearly 20 years of recurring questions last year's national defense authorization act modified the requirement for this periodic defense review now called the defense strategy of you. these changes include the development of the national defense strategy across the

near, med and far term and focuses and streamlines the elements of strategy congress considers essential to accompany answer defense review. i was interested i was interested to no the witnesses views and a prospect a prospect for more timely, relevant, and useful national defense strategy. >> welcome the witnesses secretary. >> thank you for giving my colleague an opportunity to come for you to talk about the work. the prepared statement that we have submitted in the hopes that it we will be printed for the record. >> without objection. >> i will just make a general introductory comment and in turn the floor of. and we began our work with the panel in august of 2013 one of our cochairman and general john abbott said

said that as we started our deliberation he believed the nation was running what he called accumulating strategic risk. and i think all of the members of the panel assented to that at the time as you pointed out in your opening statement that was before he had invaded in the next crimea and destabilized eastern ukraine before the collapse in its approach to baghdad. and so as we went through our deliberations i think the panel became more and more convinced that the accumulating strategic risk that the general was describing at the outset was accumulating at a faster and faster pace. as you have heard as a community from previous

witnesses at other hearings sec. schultz, my my former boss, secretary kissinger, secretary albright, the united states probably faces the most volatile and complex security environment that we face as a nation and a very long time if ever. and it struck us as a panel that given those growing challenges to stay on the path of the budget control act made no sense. i have the experience of having been on the previous independent panel to review the 2010 qtr planned in that report looking at the budget trajectory, the trajectory the cuts that were already being taken out of defense in 2010 the growing cost of keeping servicemen and women in the field over time and

other retirement costs built into the budget we predicted the nation was facing a train wreck on defense and that was before the budget control like past and before the department had to cope with sequestration. one of the things that i think we were very focused on on and i want to draw some attention to is the charge that sec. hegel give us as a panel at the outset of our deliberations. he said that as we discussed future capabilities because many of these challenges that we as a panel were talking about china and its very rapid growth of military power the long struggle that we faced with

the islamic extremism the extremism, the rise of new nuclear powers like north korea and iran all of these things are challenges that as pres. president eisenhower said were for the long haul and we have to think now about how we're going to deal with these challenges 20 years out. that is one of the mandates of the qtr process itself. it is supposed to be a 20 year outlook at the nation's defense needs. and so secretary hegel raise the issue with us the concern that the program we are going to need 20 years down the road, starting now to produce the weapons that 20 years from now we we will be needing. many of us were mindful of the fact that over the last decade we have been essentially eating the seed corn that was way down in the car reagan defense buildup of the late 1970s and early 80s.

so we so we need to be thinking now what capabilities we can provide good service men and women who we will be called upon in the future. and so i wanted to mention the specific areas that as a panel in keeping with sec. hegel's charge that we concluded we ought to be looking at down the road for the future. i i hope that you and the members of the community will be bearing some of those things in mind as you consider the program budget review. armed intelligence surveillance and reconnaissance, space because of our critical dependence, cyberspace, maintenance of maintenance of air superiority, joint and coalition command and control because of the partnerships we have. the long-awaited strike and electric and directed energy weapons. weapons. these are areas that we felt it not been given sufficient attention by the department

and need a further look in the future. happy to turn it over to michelle. >> i would just like to say how pleased and honored i am to discuss the findings and recommendations of the national defense panel. this hearing this hearing cannot the more critical time. the international the international security environment is more complex volatile. i would emphasize it's only going to get more challenging in the future. protect national interest sustain the order and address the most pressing challenges that you outline. it could not be a more of a premium right now.

it is also a time that investment to ensure that we retain a strong and agile military to shape the international environment to deter and defeat aggression when we must and reassure allies and partners and to ensure that this president and future presidents have the options that they need for an increasingly dangerous world. and yet and yet we see a time where defense budget cuts and sequestration are undermining the department's ability to maintain a robust and ready force to retain the best and brightest people and to invest in the capabilities that are going to be necessary to keep our technological edge and military superiority in a more challenging future. in this context i just want to emphasize four points. first is our number one appeal to this committee and the congress more broadly much a to work to repeal the bca and in sequestration.

this is absolutely imperative. we cannot restore readiness and investment technological edge unless we do some. sequestration not only sets budget levels too low it denies the secretary of defense the ability to protect resources for the highest priorities and puts dod in a constant state of budget uncertainty that prevents more strategic planning and investment for the future. deficit reduction and getting our fiscal house in order are essential to us national security sequestration is the wrong way to go about it. we we recommend restoring defense spending to fy 20 12 12 levels and funding the president's budget request is at least a 1st step in that direction. second, we would we would urge the congress to take immediate steps to restore readiness. the service chiefs have testified before this committee as to growing readiness problems.

only half of the marine corps home station units are at acceptable readiness levels less than half of the combat units in the air force are fully ready for they're mission. maybe deployments have been canceled. only canceled. only a 3rd of the contingency forces ready to the.. the list goes on. these impacts are real. i recommended they recommended that the congress make an immediate and special appropriation above and beyond the current budget levels to correct these readiness shortfalls. as amb. aleman emphasize the ndp ndp calls for protecting investment in future capabilities. our technological edge has long been an advantage but it is not a given.

the cutting edge technology off-the-shelf, dod has to have a smart and determine investment strategy to maintain its edge. i personally apply the department's efforts, but we have to have the investment dollars to pursue. the ambassador has laid out a number of key areas with the ndp lastly i would add they also argue that we need to pursue an aggressive reform agenda inside dod. we can and should reduce the cost of doing business. we know compensation reform and applauded the work of the compensation committee. many issues need to be addressed. some of them need to be fundamentally reframed, and i will give you an example. health care rather than debating whether we should reduce benefits and increase co-pays would need to be

debating how we get better health outcomes and reduce costs. for another to take down the 20 percent access infrastructure and to rightsizing the civilian workforce contractor career, and so forth so that we can have the workforce renewed by the future. let me conclude by saying i think this report lays out an agenda, a very clear agenda for action that has drawn bipartisan and military support across the panel. the risks of not pursuing this course are simply an acceptable. i would look to this committee and the plot your lead in this area working with your colleagues to try to convince them that the time to act on these

recommendations is now. >> i i think both the witnesses and would.out to my colleagues that both witnesses have worked for both republican and democrat administrations holding positions of responsibility in both. there certainly is total nonpartisanship in the reports. in my view that makes it even more credible because of your many years of outstanding and dedicated service. i won't take much time except to.out one of the problems were trying to highlight is as you just mentioned on acquisition reform. delayed programs. it harms our credibility and it we will be one of the am not

confident. i only have one additional question secretary gates fiscal year 2012 budget levels as the baseline for your recommendations? >> mr. chairman as i mentioned in the 2010 panel we spoke to secretary gates about what he thought the department needed to recapitalize after ten years of war. he told us that he believed he needed about one and a half to two and half percent real growth. i think the 2010 panel believed that that was a minimum and that it might actually be a higher number.

tried to wrestle with this and had a smaller panel this time. we concluded that recurring to sec. gates's top line made sense because it was the last time the department had been trying to define its knees on the basis of approaching a strategy as opposed to being given an arbitrary number the budget control act's. there were differences of view as to how high the top line ought to go, but there was consensus that the level , 1 i have to have percent real growth from the fy 11 and fy 12 levels was the minimum. >> and unless we do something the nation

security is at risk. >> i would say so, and and i think all the members of the panel believe that. >> i think we talked about the force being a a substantial risk in the near term and sequestration was not lifted and higher budget levels not restored. >> thank you. >> thank you very much. thank you ambassador, madam secretary for your thoughtful testimony in the work of your colleagues. you were obviously tasked with focusing on the needs and responsibilities for the department of defense. military forces don't operate alone and are part of the spectrum of national security efforts. if their is not a sufficient state department presence

and capacity building at local communities that our military efforts would dissipate quickly when we change or shift responsibility. can i assume or just ask that we will we talk about reviewing we also have to be conscious of the state department homeland security, every agency the government essentially protects the security of the united states. >> i think that is certainly fair. although we really are more focused on the department specifically in the 2010 panel we actually had a chapter about the need for a better whole of government effort along the lines you are discussing. you are right. solving the department of

defense problem is crucial and i would say a necessary condition for almost everything else but it is not sufficient because we have other instruments of power that we don't want to see withering on the vine without adequate funding. >> comments. >> i would agree. in just about every operation we conduct, every problem we try to solve there has to be an integrated balance interagency approach. one instrument is well-funded and the other is on life-support it does not work. our intention was to talk about the instruments of national security more broadly. >> let me shift to another topic that you talked about, cyber operations. it just from afar looking at some of the recent operations the russians, the crimea, etc., cyber seems cyber seems to be the 1st act of any sort of military operation today. the line between cyber and a

military operation your comments generally. in this touches the whole spectrum. everything is days. >> sen., i am at at something of a disadvantage because i have trouble booting up my computer. i am very reliant upon my younger sons to get me out of trouble. but the reality is a reliant military forces extensively on cyber and not only encrypted systems but on the opennet. that is a huge problem for us whenever we are involved in operation of any kind and i think i think we're all painfully aware of the vulnerabilities. we do site cyber is one of the capabilities that needs further attention and a lot

more work. my colleague may have more recent experience with this. here d relies on the open internet and yet it does not really have responsibility for defending it. the whole of government has to be involved particularly for dod. >> the expertise needed within the government, government, figuring out how we will organize ourselves beyond across the whole of government given the different agencies have different authorities. how we will work with the private sector which now

holds so much of our critical infrastructure and the legislative framework that deals with questions of liability and others that would enable the public-private partnership needed to be effective. >> thank you for your great work. >> thank you. when you are my age you we will be depending on your grandchildren's advice not just to children. in the 20 years i've been on this committee warheads 30 40 years old may be 50 years old and then the icbms in the nuclear submarines. we talked we talked about this for a long time.

i'm looking at the new situation, the knew threat that you have talked about as well as our panel now in light of the knew threat should more attention be given to this that we have in the past? the areas that have not been given proper attention. >> senator, as undersecretary i was very concerned throughout my tenure about the state of our aging. we have not built a nuclear weapon as 1990 there are

lots of ways we maintain the safety and surety of the stockpile, but as time goes on and particularly not only as inevitable corrosion and degradation of components goes on but also the loss of human capital because we are not able to get the best and brightest minds in the field the way we used to be able to, to, it is a matter of really increasing concern. they already have north korea testing nuclear weapons. iran is moving very close to being a nuclear threshold state. hopefully there we will be in agreement to constrain that. that. if their is not or if iran maintains near breakout capacity as a a prospect that may get others to the

growing stockpile in pakistan and india, china's stockpile is going in terms of weapons, although more slowly. and russia is modernizing its nuclear force. i do applaud the administration for the good work it has done, the b 61 modernization one modernization effort, but i think there is much more that needs to be done. >> ambassador, that gets into what i was going to talk about. ever since our unclassified intelligence came out in 2,007 talking about when they would have the capabilities which is where we are right now and i'm concerned about the activities.

barak, syria, lebanon. i don't think we can assume that our concern should be strictly with iran and this is my concern me about for a long time. serious problems and when you look at countries like saudi arabia and turkey and others, if they see what our capabilities are then you know i would assume there going to be involved and we we will have another arms race coming. does that concern the two of you? >> i think our strategic nuclear forces have been one of our huge strategic comparative advantages since 1945.

i think we cannot afford to let that advantage go by the wayside. extended deterrence of our allies in asia europe and now increasingly in the middle east has always been a difficult proposition the stockpile an inventory of nuclear weapons to make our willingness to use those weapons in defense of our allies, a very difficult proposition to convince people of. it's still going to be a difficult a difficult proposition to convince people about. ..