>> you know what the initial cost was supposed to be, general? >> oh, i do. ws >> all right. >> i was the head of aviation. >> was that fact wrong? >> that was pretty close. >> and there's $150 billion overrun. >> i can't comment on that. >> you don't know what the cost overrun has been? >> well -- sir, this is not a single point in time. i have noticed the program go. i went through the technical base line review last year. $4.5 billion. >> let me interrupt you again. do you argue the fact that there's been 1$150 billion additional cost since the $238 billion? >> i can't comment on that. i can't tell you whether it's $150 billion. i know it's significant. a. >> so for the record, you don't know how much the cost overrun has been for the f-35? >> not precisely. >> roughly?

do you know roughly what the cost overrun has been? >> no, i don't.w/ >> it's remarkable.w/ so we continue to have 500 million -- $500 million cost overruns on additional 32 aircraft that are 50% complete. does that mean, mr. secretary, that we will have a billion dollar cost overrun since the aircraft are 50% complete on block 4 aircraft? >> senator, i don't know if you can make that extraplation or not./ >> well, all i can say is that i have been watching this aircraft since 2001, and i have watched the cost overruns now and i

don't believe that it's inaccurate to sate there's been roughly $150 billion additional costs and we are now still in the early stages of what was planned to be 246,000 aircraft planned. what is your assessment, mr. secretary, of the situation as regards the f-35 now? >> the situation for the navy and marine corps as regards the f-35 is because of the -- some of the issues you have identified with concurrency and with the readiness of the aircraft, we have reduced the number of planes that we are going to buy, but we have remained constant in the number of total aircraft that we will buy in the program.

680 aircraft total for the department of the navy. that's 420 for the marine corps including 360 bs and 80 cs for the marines, the remainder "c" variant for the navy. it's a capability that we need. it's a capability that the marine corps does not have a backup plan for. you correctly pointed out that we have bought the carriers from the british then we they retired their carrier. we did that to extend the life of the harrier to make sure we p landing capabilities in place until the arrival in sufficient numbers of the f-35-b. >> thank you. mr. secretary, gerald r. ford cost overruns are $1 billion and i'm not sure how much it is

complete. will the navy be asking for legislative relief from the cost cap of $600 billion? >> senator, not this year, but i'm certain we will be asking next year. >> is it accurate that there is at least $1 billion cost overrun on the gerald r. ford? >> i think it's accurate that it's at least $1 billion over the original estimate. and i think it's important to note what we have done to contain these costs. when i took office, we -- since i have taken office, we have recovered back the fee almost completely from the ship builder. that is building this carrier. so there whatever monies they get from now will simply cover

their cost. secondly, for some of the government furnished equipment from other vendors, we have capped the amounts that we're going to pay for those. and the ship remains on track to be in the fleet in 2015. but third, and perhaps most importantly, one thing you mentioned in your opening statement. this is the lead ship of the class. you and i have discussed how much new technology was put on this. previously. and how the risk went up and how that risk -- the downside of that risk came true. but the one thing that we are absolutely committed to and the one thing that we will not go forward, we will take the lessons learned here. we will have a firm price and we will not come back to the senate

to ask for our congress to ask for raising the cost cap on the follow-on ship, the john f. kennedy. >> mr. secretary, your pledge of $170 million as a navy share of a $510 million effort to construct or retrofit biofuel refineries. where's the authorization for that action? >> comes from the defense production act and from appropriation made. >> authorization? appropriation. i'd be glad to know where it is in that act. by the way, if i can just mention, mr. chairman, last year the navy entered in 2000 -- in 2009 they paid 424 a gallon for

world record at the time 330 million gallons per year of alternative 50% of the alternative sources by 2020. with no -- at no price or cost there. i don't believe this is a job of the navy to be involved in building and involved in new technologies. maybe this will be a solyndra situation. i don't believe it's a job of the united states navy to do that. i believe it's the energy department who should be doing that and obviously i will seek to act on amendments on the floor to try to prevent this kind of waste of the taxpayers' dollars where they paid for algae fuels. i don't think we can afford it.

>> i think we should -- you want to take a moment to -- >> if i could. >> if you wish. >> yes. the place that -- the authority that's being used here is a defense production act which has been in place since the early 1950s which says that if there is an industry that defense needs, but does not exist in the united states, a defense not only can but should invest in that industry, energy is specifically mentioned in the defense production act as something that defense should look at. and in terms of moving toward biofuels, the numbers that we bought small test amounts was

high. it's come down dramatically since then, even with the small test amounts we have been buying. and i think that we cannot afford not to do this. we can't afford to be dependent on foreign sources of fuel. we cannot afford to be dependent on a worldwide commodity that has the price spikes and the price shocks that we have. as i said in my opening statement the only place i have to go to get money when the price of fuel goes up is out of operations accounts. i don't think that is something we can afford. >> okay. thank you. now senator lieberman. >> thanks, mr. chairman. thanks to you three for your service and leadership. i want to ask you contemporary questions before i get to the budget and particularly you general amos about the marines in afghanistan. the first we're going through a difficult time, beginning with

some acts of violence by afghan national security forces against our troops and now we have had a couple of bad situations involving our forces. give us a sense if you can of what you're hearing from our marines in afghanistan about their relationship with the afghan national security forces and if it's relevant with people of afghanistan that they're interacting with. what kind of level of trust interaction do they have? >> senator, the -- i can probably sum it up with just a recap of an e-mail i got. we turned over the leadership of the marines in helmand province. the command was given to general gainous. the night before was a huge dinner and i'm confident that you have met them on your many

visits in there. at that dinner at that night with all the commanders and the leadership there, there was -- there was much discussion, almost to the point of tears, as general me lieu recanted the last 13 months of general tullen's time in afghanistan in the helmand province. so they talked about how the marines saved the lives of his soldiers. how marines died saving the lives trying to retrieve a drowning afghan soldier. we have not seen the level of violence in helmand that we have seen in other places. my sense is that it's a result of strong relationships, a level of confidence. doesn't mean they're not going to be things that are going to happen, senator, you know this. but i will tell you that there is a great amount of confidence between the afghan security forces, the provincial governor,

the leadership, the prt teams from the u.k. there is a real sense of brotherhood and bonding there that gives me a sense of encourage. >> thanks. that's certainly been my impression. obviously when individuals on either side, afghan or american, of course we have been dealing with cumulatively hundreds of thousands of people in service and afghanistan go awry that it attracts the attention. my impression is what you have conveyed. on the ground the relationship between the american an afghan forces is deep, it's full of trust and it should give us confidence as we go forward in our mission at afghanistan and certainly discourage anybody from going into a panic mode about picking up and running. i want to ask you a contemporary

question. yesterday or this morning in the news, much has been made about the fact that the marines who met with secretary panetta yesterday were asked to leave their arms outside of the meeting area. frankly i don't know why the media are writing about it, if it's a good thing or a bad thing, but i you can explain that decision. >> senator, it is my understanding, i don't have any more facts than what you had. not because of that issue, but on another matter i went to talk to the commander on the ground. but we were exactly in the seam of the turnover. general tullen had left, we've got brand new commander on the ground. he wants -- you have secretary of defense there. it's my understanding that the senior leadership, sergeant major made a decision, okay, we don't have the afghans in here with their weapons. we don't -- so marines can stack their arms. we don't typically do that.

i wouldn't make any more out of it. i think it was a decision that was made. i don't think anybody should be read into it. >> good. it's good to know. thank you. admiral greenert, in your prepared testimony you have a part that says you refer to the history which shows us that conflict is unlikely to occur in the form of the scenarios for which we traditionally plan and you make reference to the contemporary cases of iran and north korea and then you say in the budget submission, we shifted readiness funds towards sensors and tactical training that can be rapidly fielded to the fleet including demonstrators on prototype. since we're so focused on iran and the threats presented by iran particularly in the maritime context, i wonder if you can tell us in a bit more

detail what the navy is asking this committee to authorize for fiscal year '13 that will specifically increase our >> se, senator.efend against any after i took the watch, one week into the job i went to japan, korea and then to bahrain to see my counterparts and sit down and talk to admiral fox and then i subsequently talked to general mattus. i went through the straight of hormuz on the uss stennis and it was a nice, clear day. i have a nice view of the nav navnaval units that come out to monitor it. in between all of those i came to the conclusion we could do better setting the theater. i wanted to be sure as i said in the testimony that we are ready. that our folks are proficient, confident. they're good at what they do in case called upon. i wanted to be sure that the theater was set. we request to

improve our mine warfare capabilities in the theater, we are moving four more mine sweeps that will make eight. we are moving airborne ll take theater. then that -- those working with the british mine sweeps there, which we exercise with frequently sets us up a bit there. i want to improve underwater mine neutralization. there are systems that were available and had proven to be subsequently good. i want t sure we had counterswarm capability. that's involving the gatling guns andelectrooptimal and as we go through the day, we can see and we have a good view of that. you know, you go through the strait of hormuz with a carrier you have a hunting rifle and you may need a sawed off shotgun. some people use that as a matter of context. and there's submarine and

torpedo improvements and i'll roll it up to $213 million in '13 that i'm requests and it's 758. >> thanks. that's a very encouraging report. i can't help but senator mccain incorrectly questioned about the overbudget. give me a response to one that not overbudget and that's the procurement of virginia class of tech submarines. >> we took to california three months ago, eight months early and several hundred million dollars under budget -- i'm sorry, $100 million under bu.hat we have with those two vendors. >> thanks mr. chairman. >> thank you, mr. hankliou, mr.. i wish i had more t getting int thing that was brought up by

both -- primarily by senator mccain. on the mandated changes in your 50/50 program on the field that you would be purchasing, just a minute ago in -- mr. secretary, you said that any time the cost goes up a dollar, it cost the department $30 million in extra fuel costs. years '12 alone in large part deue to the politica unrest -- well, if you do the math on this thing it appears to me senator mccain mentioned the purchase of 20,000 gallons of the algae fuel that was gallon. now, i assume that's all behind us now and that was an experiment and that's gone. but what we are doing now is talking about the cost of the 50/50 blend. the 50/50 blend as i understand it, and i'm taking the figures from you guys, would be 26 -- it

would be $15 a gallon. now, your jp-5 as i know from my own purchases is between $4 and $5 a gallon. so you're talking about an increase of $10 a gallon. is my math off here? >> no sir, it's a test amount. it's to do a demonstration at the rim of the pacific exercise in july off the coast of hawaii. using surface ships and aircraft off our carrier there. but the whole point of this is to establish a competitive industry and the navy will not be buying commercial quantities of biofuels or anything else that is not commercially

competitive in price. but it takes a little while to get there and one of the things the navy can bring is a market for these fuels. of. >> but the figure that i have heard, i thought it was a quote from you that eventually you'll need 330 million gallons a year of alternative fuels to meet your goal of 50%. is that correct? >> yes, sir. >> so you'd be talking about 660 million gallons. you apply your $10 to that. this is a huge amount. >> i'm not going to apply the $10 to that because when we get to that level, it will have to be the alternative fuel will have to be competitively priced with the fossil fuel that is being blended with. >> okay. not to get into that right now, but for the record i want you to send me what you just now said and show the documentation

that's not the way i read it. but that's all right. will you do that? >> yes, i'll be happy to do that. >> all right. on tricare, we had the army in here last week and i kind of pursued this a little bit. i look at some of the changes that are taking place. i know during the bush administration they were talking about making incremental changes in copay at that time for '07, '08, '09, '10. we put a hold on it in congress. maybe we shouldn't have done that because i know the cost of healthcare have doubled since 2001. the budget that you were talking about right now seeks to save $1.8 billion in 2013 and $12.9 billion over the period of the fta. so my thinking here when you calculate this, it's my understanding that the enrollment fees are going to be increased depending on what rank you are similar between 94% and

345%. i had sent the -- some stuff in for the record when the army was in here. the administration official said that one goal of the increased fees is to force military retirees to reduce their involvement in tricare and eventually opt out of the program in favor of alternatives established by the 2010 patients -- obamacare. you want to about this? you think that's somebody's goal here? >> well, i will comment about what we have requested in the budget. as you correctly pointed out, healthcare costs are going up dramatically. personally they're the fastest growing cost of our budget and something had to be done to get that under control. the item that's been recommended in terms of tricare is that for

working-age retirees from the military that their premiums for tricare do go up because in most cases they have access to other health care. but even if they want to keep on tricare, the largest increase which would be for senior officers would go up to about $2,400 a year for healthcare. that represents less than half of what you would pay as a federal employee or as a civilian out in the work force for health care. so tricare would still be significantly less expensive than a competing commercial policy. >> have you done any kind of a study and answer if this for the record because it would be a long answer. as to the number of people who are retiring, who might not be able to afford this because that range that i mentioned i think is still -- is still accurate. i wanted to get to one other thing and that is what's

happening right now with over in africom. i know the obligations that you have and i got back from the horn of africa and i talked to admiral losi and others and we're concerned about the activity over there. we know that the increased activity in somalia and along the east coast but we know more recently the activity is on the west coast. and i know the times you have had 64 incidents of piracy that were reported in nine countries off the gulf of guinea. i was there and talking to some of the people that they don't seem to have any resources over there. i wonder how thin you're getting spread down there. are you able to do all this stuff that you had not anticipated would happen two years ago? >> we're able to do what we're

asked to do in the global force management plan. what we need to do in the future to get better is we need to coordinate and synchronize with our partners. what i mean by that, we had an international symposium and got together with the nigerian and the guinea navy and all those who operate in the gulf of guinea. we show up and there's two of us there and nobody there for a period of time. so i'm meeting in fact next week with the chief of the french navy. that's one of the things we're going to sit down and do, senator. we need to synchronize what we're bringing forward and o our -- for us as we move into the future when we bring on the joint high speed vessel we'll have a better opportunity to patrol in that area, with a ship that resonates better. >> yeah. i direct this at both you and general amos. i was in liberia and met with the navy and with the marines there and a lot of what they're

doing the increased activity in the western part of africa, the 1206 and the programs have been helpful. would you comment as to that? >> senator, it's been a year and a half ips i was over there on the liberia side. previous contractor had been done, was unsatisfactory with the government. my sense in talking with both the president and the american ambassador there and the chief of defense was at that time they had been very happy. all my reports have been very favorable. >> admiral, do you agree with that? >> i do agree. it's a very worthwhile fund. >> all right. thank you, mr. chairman. >> thank you. senator hagen? >> thank you, mr. chairman. general amos, i wanted to ask one question on the camp lejeune water situation. in a recent statement made immediately after the airing of

the semper fi issue, the commander of the marine corps said we are committed to finding a responsible solution to this challenging situation. i understand that the agency for toxic substance and disease registry has the lead in studying the contanl natimm nat. is there anything that congress can do to expedite the care for the families and the service members for those who have contaminat contaminated? i know that's one question. can you talk about the progress that the marine corps has made to find those who lived on the base during that period? >> senator, i read the same comment from gerald kessler and we have spent $30 million in an try to bring science

into this. there are allegations out there, i read them, i spent an awful lot of time and effort. i'm committed to be faithful, to take care of my marines. that's not just the ones on active duty, but all those who have gone before. the truth of the matter is today's science has not proven with regard to the camp lejeune water and the affiliation with cancer. that's the job of the national academy of sciences. we have gone out, we spent $30 million. we have a website. i know you're familiar with. i published a new book, put ittiit back on the website. with facts and communication tips. just in the last three years we have -- we're sitting at 179 folks who have registered that we provide information to and

they can get it off the website. the key is to give them as much information as soon as we know scientifically what the relationship is. we're committed to that, senator. and short of congress specifically going to a marine or marine family and authoriz g authorizing, you know, on a unique basis care for that individual, i can't think of anything else short of waiting for the science. >> well, i appreciate the efforts you and the secretary mabus are putting towards this. i wanted to ask general amos about the joint strike fighter which is essential to operate and operate and move seamlessly from the sea to the air. i don't need to tell you about the aircraft capability of short takeoff and vertical landing because we know that that is key to preserving the strategic value of the