happened? we will not be able to make the strategic investments where we need to make it. >> i'll take the easy one and pass it to them. in the last ten years of war and how we can better integrate emerging capabilities and the three e mention are isr. phenomenonly better in terms of high definition, all the things that have happened on your iphone have happened to us. the second one, of course, is the special operating forces. we're going to grow them by

3,000 in this budget. eventually 8,000. that will allow us to get back to the high end direct action activities but building partner activities across the globe. and the last one is cyber. that's the third of those three capabilities, i think, that we have to account for now. >> the problem is it will impact every area of the defense budget. but the investments we're making will be undercut. instead of having the weaponry and technology that we need. the equipment, the training and support system that we need, all of that will be undercut by sequester. so cower not only hitting the main elements of the defense

system, and the structures there. you're hitting the investment system. so important to the future. >> and how do you view -- there's a lot of talk about giving special operations greater flexibility, even outside the combatant commanders. and what is your view of how that is going to evolve? >> well, first and foremost, i'm a big spother of special operations, particularly in my last year. i had a great relationship. worked very closely together. they are looking at ways to see how to expand their roles. but we're in the process of considering some recommendations. we haven't made any final decisions. but i can tell you this, special forces will play a large role in the future. >> thank you.

>> thank you, mr. chairman. i want to thank the three of you for being here today. you come here with unique qualifications to be here today. general several see, your record is exemplary. i want to congratulations you on having children that follow you in service. what you talk about prior with three years of trillion-dollar deficits. it's a concern and i appreciate you bringing that up. he said another factor involves the element of time. we, you and i and our government must avoid the impulse to live only for today.

we want democracy to survive for all general tragss to become, not to become the inkol vent so phantom of tomorrow. there's a wonderful warning to all of us regarding trillion dollar deficits. you've sat in these chairs. you know the challenges that we face. back in 1977, you were one of the first people to introduce a biannual budget bill. do you still support that concept? >> i always felt that it made sense to cry to extend -- because we were fighting a budget battle every year, and frankly we would have been better off establishing a two-year process in which woe would have said it would give us some planning for the future. it would allow us to look not just at the moment, but what we need for the next year.

so the answer is, yes, i still support the biannual. hopefully i can finish what you started several decades ago. how would that affect military planning to have a two-year budget cycle? >> we could have a much more stable approach if we knew we didn't have to fight the battle over funding every year. >> do you feel it would enhance oversight? zbli i think it would. my view and the point behind the legislation i introduced was no allow one year through the budget process and frankly one year for better oversight. i represent northeast wisconsin, where the fine shipbuilders are

building our combat vessels. >> yeah. >> and i'm just wondering how the decision process was made for reduction at lcs? >> obviously the navy made the recommendations on it because i think they were trying to emphasize other elements if the fleet they thought they would need for the flexibility and agility that we needed. but i can't give you a specific answer. >> it goes back to the chairman's comment about are we giving up on a particular number as the goal for the size of the fleet. and i think what the cno is doing is taking a look at future threats, taking a look at a new fiscal environment, which we all acknowledge, and determining how best to manage the fleet, so it provides as much versatility as possible. and anything we do now has to be

multi-role. that's one of the characteristics of the decision that we made in the budget. you'll see the things that had a single role in the past have been -- we're letting them go, so we can have as much multirole capability as possible. >> thank you for that answer by the way. could you expound a little bit on what we might be able to do to encourage nations like germany and france and other things in europe to -- i think there's a sense we're pulling more of their weight than they are. >> i always answer by pointing out if we go to war tomorrow the folks to ask to go with us are still traditional partners. so we need to stay committed to them as they do to us. thing a regrat is quite large. p $300 billion in defense in the

aggregate. your point is the absolutely correct one, which is how can we best harmonize their capabilities with ours? there are things we need to investment. sr, tankers. things that are typically on which they rely on us. and they have an initiative. nato smart defense. and we're trying to articulate what that means so it produces the outcome you just described? >> thank you. i yield back. >> i may i briefly say a word? it didn't work before because we never got the appropriation. if you're going to push it. >> point taken. >> thank you, mr. chairman. secretary panetta, thank you for your service.

and thank you also general dempsey. i'm a bit embarrassed. you know, all the way from the academy to the head of the seventh army to here. knowing your record very specifically as to why are you recommending that we cut the missile defense funding for israel from 120 million to $106 million? that message -- only a small part of the budget, isn't it? when we end the day of pandering, mr. general on our side of the table here, and then we'll really get some action in the middle east.

israel is one of our strongest allies. we doubled the money, as you pointed out. so it's really beyond that. it wastes our time as to who is more concerned about israel. we are committed to that country. period. so i apologize if what you're asked. the reality of the situation that we live in, where we need to provide the resources if our military and keep us secure at all times. in previous years the changes were tough to make. even though they don't request unneeded weapon systems. like alternative engine.

this year i got to salute the other side. i want to give the folks on the other side credit. we were allowed to take a vote. individually. on some of these unneeded weapons systems, like the f-35. this unnecessary program was kept alive for years. how many money we did west when you go back in the years when there are attempts to change things? now that it's been eliminated we're going to save $3 billion. mr. secretary, can you talk about the other changes that are included in this budget, and how they will save the taxpayers money moving the forward? before you answer that question, mr. secretary, if you would, my time will run out, on the matter of traumatic brain zwrur, we have a long way to go to live up

to what this congress and past congresses have attempted to do for our soldiers who have not been responded to when they come off the signature injury of traumatic brain injury and post-traumatic stress disorder. i would like you to address that. can't do it today. at least address the first question. >> briefly on traumatic brain injury. this is an area of tremendous concern. even though they may not display the symptoms of it, when they're back this the communities, it's clear that they've had that kind of injury, and also for those who have gone through ieds, traumatic brain injury is something that we see all the type. they are able to regain their

capability. soinss and medical sciences doing wonderful things. but we need to do much more to ensure that they're protected. with regards to procurement, this is an area in particular where we have to do everything possible to try to achieve savings. yoif pointed out some of the decisions that we have made with regards to the procurement area in order to ensure that we don't go ahead in the weapons system until we know it's tested and fully capable. and the longer it drags on, the more changes are made, the more expensive it is. by the time it comes out, it's already dated. we have to begin by looking at the changes made up front and go into production sooner rather

than later. also we have to do more competitive bidding with regards to the weapons systems. we have to require industry itself to cut costs where it can, instead of sometimes going ahead and doing things on their side that build in additional costs in the system. so there's a series of steps that we are taking that are part of our efficiencies to improve procurement reform. >> thank you. >> thank you, mr. chairman. secretary panetta and general dempsey, thank you for your service. i want to let you know there are several of us in this congress that have your back when it comes to the sequester. we have your back when it comes to supporting uniform military men and women. we also have your back when it comes to not balancing the budget on the backs of the uniform military. what you do is the number one responsibility of the united states government in this document. one of the quotes that you said, mr. secretary, was that this budget and this strategy have no

margin for error. what keeps you awake at night with respect to this budget and this strategy? the second quote comes for general dempsey. we have an increasingly competitive security environment. in light of those two quotes, what keeps you guys awake at night? >> i worry all the time about the fact that we are going to wake up and we'll be subject to a crisis or a cyber attack that we have no idea where it came from and it's crippled our country. and i worry a great deal about that. there's a hell of a lot to worry about in the world that we're in.

i worry about what can happen with iran. i worry about north korea. i worry a great deal about what can happen in the middle east. syria, yemen, bahrain, other places. egypt. those are concerns. first and foremost the unexpected attack that yooer not prepared to deal with. >> keep it short for me. >> i do. >> i like your style. that's my style. >> well, i worry about the kids. if we don't ensure that they're the best, and the other thing is the world needs america to be a stabilizing global power. the world needs america. and if we reduce our defense

capabiliti capabilities a and we maintain our aspiration, that puts the kids at risk. >> i would like to put this up. this is where i want to go. you obviously have, you've had quotes talking about the security environment that we have. you have a quote about no margin for error. this defense spending is a percentage of gdp. the long orange line represents where we have been historically. the lines to the right represent different outcomes. the bottom line is the sequester. which we're going to fight to keep that from happening. spending less gdp, the lowest number in recent history, probably ever in the history of this country, bothers me in

light of your quotes. i would ask you this. in light of your earlier quotes about security engagement. what should defense spending be as a percentage of gdp. assuming we're not trying to recapitalize the force out. planning over the long term. the answer is really what is our capability. and do we have a strong capability to be able to respond to anied a ver care. more than one adversary at a time and not only confront them, but defeat them? that's the challenge. the budget we presented, we feel confident we can be able to take on anied a ver care, confront and defeat them. that has to be the fundamental question.

i think we're comfortable, even though it's been a difficult process. we're comfortable with this budget strategy that we've presented here that we can protect america. >> let's get into the weeds for a second. let's talk about joint strike fighter for instance. i've actually sat in the joint strike fighter, and you're right, it does have amazing capabcap capabilitie capabilities. i'm worrying about reforming it so it defedefers. when you do that, the cost goes up. what happens to the cost? what happens to the foreign buyers? if we slow down, they're going to slow down. what happens though -- >> that's time. >> okay. >> can i give an answer? i mean, we have three variants on the jsf fighter, and just by vir chu of having three, we have

to make sure every one of them works. we've been testing each of just took the marine version off of a delay of probation because it hadn't met the test. we want to do this right. it is a complicated effort, but the time we have to test it will guarantee that ultimately when we go to production, we'll have a better plan. >> mr. chairman, mr. secretary and general dempsey, thank you so much for your testimony and thank you so much for your service. i'm appreciating the unsebl level of our national security. thank you for making proposals that will implement efficiencies while keeping our military strong and our nation safe.

i wanted to ask you about overseas contingency operations, the budget includes $44.2 billion per year from 2014 through 2022 as place holders for future war costs. now mr. secretary and general dempsey, you have said that forces are on track to take the lead responsibility for afghanistan's security, and you have talked about that today, at the end of 2014. assuming that that timeline holds, is it possible that we could have significantly fewer deployed troops in 2015 and beyond and could our costs be less than the $44.2 million in those upcoming years? >> there's no question, we're running i don't know how much

per year for the war? >> about $88 billion. >> $88 billion. there's no question that we're going to achieve savings. the president's made clear that we'll have an enduring presence in afghanistan, but it will be at a level i think will help support them. >> that -- the costs of this conflict are fully encumbered. some of that cost is training to deploy, some of it is executed in-country. but we also have this huge bubble of reconstitution. if we win today, the next two years will be resetting a force. so i can't predict what those costs will be outside that far and i think the place holder is

important. >> i want to take this opportunity to make a suggestion for some of those costs. i wanted to talk about health care costs, the affordable care act adopted a number of measures to begin reducing the cost across the board and the cost containment measures reduces military personnel in accrual costs. so as some advocate for the cost savings of the affordable care act to be eliminated. how will this impact those cost savings to the budget. >> we're looking at that all the time, it's a very complicated question. i think i would like to take that for the record in terms of

getting our experts answer. there's not a real simple answer. >> mr. secretary, thank you for being here today, all you gentlemen thank you for being here today. recognize that we're in a difficult position, we're here trying to perform a balancing as as you are. i need your help, please, to help me understand -- i need slide number 12 please. why we are where we are. and if we don't have slide number 12, it's going to be difficult. we're looking at a national defense outlays that are roughly 25% above where they were in the late 1980s, when the soviet union was still around.

70% above where they were as recentry as the late 1990s. i hear-if i can go to the second slide. >> this is 126789. >> that's slide number 4. i i'm. >> that was a different power point we did this morning. >> even with the 487 which you gentlemen are looking at. the sequester, which mr. secretary you have described variously ---it's a 9% cut, but it's a 9% cut off off a number that's increased 70% since the year 2000. why is it so hard?

i want to accomplish the same things you want to accomplish, but why is it so hard to cut 9% from a budget that's up over 30% from last year. >> we have never cut the defense budget by half a trillion dollars, so inns a very significant cut that the congress gave us to reduce the defense budget by. and to do it at a time when we're facing the threats that we're facing in the world, i think that has to be taken into consideration. if you continue to come back at defense and continue to cut it, the margin of error that i talked about is there because it will weaken us in our ability to address the number of threats that are out there. if we were coming out of world war ii, where the threat suceded

to nothing, it would be different. we have a huge amount of threats out there that confront this country. >> i do recognize that it's half a -- >> am i understanding correctly that you have not made plan force the sequestration? >> that's correct. >> and in all fairness, mr. secretary, that's just as much the law right now as the $487 billion, isn't it. >> it's the law, but it doesn't take effect until january 2013. >> what am i supposed to tell my folks back home that the -- >> i think it's totally irresponsible for the congress to allow a sequester to take place that will weaken our military. >> you're preaching to the

choir, i voted against the budget -- >> but it's a law that frankly doesn't require -- it basically provides a formula that cuts defense across the board. there isn't a whole lot of planning i can do that deal with that kind of approach of cutting the approach. i share the worries about cyberalacybera l cyberala cyberalack -- i don't question in terms of what the role is, my question is how are we going to pay for it? do you remember those words? >> yes, i do. >> we're just trying to do the same thing you tried to do in

1992. >> and i'm with you on that, i think it has to be paid for. >> mr. honda. >> thank you mr. chairman and welcome. it's good to see a local boy. mr. secretary and general dempsey, i just want to thank you for appearing before us today. the end of our presence in iraq, the expedited drawdown on afghanistan will go down in history. the chalgts up -- the challenge of drawing up new this