someone had said nato would be operating an air campaign over north africa, they would have been sent to an asylum, but that indeed happen in the following year over libya. so with those two principles in mind, even though they create some complications, i think it's really important to think after 2014, what could nato's priority missions be? there's a lot of things nato does, but what should really be the focus areas? and i'm going to pose three as suggestive and would love to hear from you in the discussions about whether these three are about right. and in no particular order, i think, first, nato's going to have to engage in some form or fashion in what i call the greater middle east. this is an area that's going to be unstable for generations to come, and i don't think we can have the entire underside of eurasia in turmoil.

and expect it not to demand the attention of the world's foremost alliance which is right next door. i think this will be a priority, really the top priority, whether we wish it to be or not. pivoting to asia would be wonderful, but i don't think the middle east will be willing to accommodate. i think there are potential roles on a steady state basis for nato or nato members, and certainly also in crises, which i think unfortunately will demand nato's attention. second, i think russia looms, at least as importantly, and i think here nato has to think about a hedge against russian futures. and the russian future that i worry most about is a declining russia, and this is in part due to the shale gas revolution, which is dropping the price of energy, which i think in essence is going to bankrupt russia's state business model. and then there's also some very daunting demographic factors that are going to, i think, really create some new

challenges for russia. and i worry about a russian leader trying to distract a very restive and unhappy domestic population by launching some sort of coercion or aggression in the area. so that's sort of the russia that i worry about, and there's things that can be deterred in those scenarios. third, i think, perhaps the third nato mission is preparing for the unexpected. this one's tough. this is the one that's most likely, as we've proven, so i think what this means is we need to take a portfolio approach. now i'll go through each of these sort of in turn in terms of the specific deterrence issues that i think are important. for the middle east, i think it's a bit problematic for the alliance to highlight this clearly and explicitly due to political constraints on nato planning for contingencies in the middle east, but we know that threats from this region can directly affect some nato

member nations, such as turkey, and we know that potential broader challenges loom. despite president rouhani's magnificent charm offensive, and i do think it's an important opportunity for our negotiations are iran, those negotiations ultimately may not bear fruit, as happened with north korea in the 1990s. north korea now has roughly a dozen nuclear weapons, and we cannot rule that out, although it would be a really very, very challenging and consequential future, we cannot rule that out. if that happens, we've heard saudi arabia may acquire nuclear weapons. this is a major disequilibrium next to the alliance that nato members would have to be attentive to, even though it's really difficult to deal with. we also can't rule out an unstable pakistan, which would have very significant implications for nato in particular because of wmd armed elements getting ahold of these

weapons and using them in ways that would be very dangerous for us. so that's just a couple thoughts on the middle east. in terms of russia, i think we also have some constraints on our deterrence and certainly the russian is felt more by northern members by nato, including the united states government, which i would state rather clearly places russia as a defense problem in a pretty low -- at a pretty low level priority. i think we just need to state that clearly. and i think russian challenges may come in more sophisticated forms than we saw during the cold war. we're talking more about energy coercion, about cyber, which we'll hear about covert operations, about arctic contingencies, which i think are newly important for obvious reasons, about softer things like russia funding prorussia mayoral campaigns in the baltic regions, so i think these are questions we should parse through.

these are serious challenges. nato is going to have to get more nuanced to deal with those types of security issues. and then in terms of sort of preparing for the unexpected, there are other obvious difficulties in this area, but here we take a portfolio approach. asia looms very large, as fred kempe said, this is where economic power is shifting and defense budgets across asia are rising very rapidly, and we can talk about some of the statistics, but there's also challenges associated with non-state actors, as i said, individuals and groups. and i worry in particular about bioterrorism these days with a very significant expansion of the proliferation of centers of biological expertise, unfortunately, i think it's much more likely we'll see bioterrorism, and i think nato publics could be better informed and more resilient to these types of threats. so there are elements of the deterrence and assurance approaches even in dealing with nonstate actors, which we could talk about more.

and even in asia, i think, there are nato members that have territory on the pacific ocean, for instance, if the north korean icbm hits guam, that's an article 5 pacific contingency. we should talk about sort of what that means for nato and nato planning and nato responses, but i don't think there's any getting around that essential fact. now, in terms of the tools that we have, because i wanted to address tools before i pass to my other panelists, i think there's sort of three categories of those types of tools that we can use to underwrite the deterrence approaches that i just talked about. the first category is traditional areas. we'll hear about some of them later today as the ddpr also discussed, and i think you all know that list pretty well. there's also some emerging areas, and i would put cyber and space still in the emerging areas. let me focus on space, because we'll hear about cyber, but i think space is an area nato is sorely behind in.

russia calls for taking out nato's access to critical space assets in the early days or hours of any conflict or contingency and nato's approach is, well, i'm not sure anyone knows nato's approach, but it seems not to really address it, for a couple reasons some of us know. so it's really important in terms of all the areas where we should be erecting deterrence efforts and where there is demand and challenges that might be associated with these domains, space might be the one where supply just doesn't come close to demand. and i think it's important to note that weaknesses in space deterrence can undermine general deterrence, because nato and the u.s. in particular are the most reliant on space assets for our military operations. there are some good stuff in iran study in terms of how to address space deterrence. just very quickly, international norms, enhancing collective space security capabilities, enhancing the resilience of

space architecture, which involves sort of redundancy and potentially using some new technologies where we don't have these very expensive satellites that have everything in them, we can put up a constellation and more of a network approach. and i also think we need to have a deterrence policy, a declaratory policy for space that people actually understand and that adversaries and allies alike understand that includes concepts of proportionate escalation that are not just limited to space. and then thirdly, new areas that i think are worth considering, as the world is changing so quickly for deterrence tools. one is energy. it's possible we'll see a crisis in the future in the pacific, maybe in the european area, where there's some sort of blockade or some sort of energy coercion. and with the new shale gas revolution, with other new energy developments going on, i think it's possible we could use energy supply as a tool for

reassurance and potentially also deterrence. and then secondly, juan zarate has a new book out called "treasuries war" that looks at financial instruments, how they play a role in deterrence. i think they could be better integrated into nato's deterrence approach. and so with the atlantic council here, we're looking at a lot of these tools and trying to look at how to better integrate them in terms of deterrence in asia and in this conversation, deterrence in europe. let me just end by saying, i think everything i just said sort of has four implications for the portfolio approach we need to take to nato's deterrent. number one, i think nato has to really greatly differentiate its partnerships in the middle east and in asia, for the reasons that are quite obvious in terms of what's going on in the world. number two, i think the alliance's challenge advantages

-- technology advantages are in danger of being lost. there's so many pacing, competitive activities under way in china, in russia, among individuals in niche areas. i think it takes a lot more concerted effort for the alliance to retain its technology advantages in key areas. third, i think strategic foresight should be practiced at nato, and that is looking more at these longer term trends, but coming back to the present, what do these things mean for our current planning, for our contingency planning, for our strategic concept, et cetera. i think this is a new, but important element to be added. and lastly, i think many of you in this audience can help us, i think a lot of nonstate actors, private sector actors, need to be brought more into nato's efforts, be they energy companies, be they financial companies, technological companies, because if we're really moving to a world that i

call west fall -- think we really need much more strongly leveraged the assets, knowledge, and capabilities that such companies can bring to nato's deterrence approach. so if i had to summarize everything i just said, i would sort of basically call it the cross approach, which is for nato's deterrent, i think, it needs to be cross domain, i think it needs to be cross regional, and i think it needs to be cross actor. thanks very much. >> terrific. thank you very much, barry, to take the time to lay out that concept. i want to pivot from the american perspective and come to svein first before picking up jay and stefano. barry's just laid out this concept of an alliance, thinking about an engagement and prepare for the greater middle east, which i hope you'll get into, as well. hedging against russia, preparing for the unexpected. he's talking about bioterrorism, space, energy, these new tools. and yet in our conversations in our last event, there was a sense among some of our european participants weary of a decade-plus of battle in afghanistan, leery of future

commitments, and where you saw commitments as in libya, an effort to try to minimize the engagement of the alliance. so i want to turn to you, svein, this impetus among some that we hear in our european colleagues of hunker down, back to core article 5, there's a crisis in capabilities, because there's a crisis in defense spending. how do you reconcile what barry has just laid out with how you as a european defense planner think about where the alliance is going, where it needs to go in terms of deterrence, please, over to you. >> thank you very much, damon, and thank you very much for the atlantic council for its tireless efforts to keep this transatlantic dialogue going and interesting people in the u.s., so it's very impressive to have all these high ranking americans present to discuss these issues. what barry pavel said about preparing for the unexpected -- >> pardon me.

>> i don't have to repeat that, i suppose? >> no, i think you're fine. >> what barry said about preparing for the unexpected is very much what i will talk about, and as you said, damon, also, it is to some extent returning to the basics. but i think this is a very timely initiative, because the operation is coming to an end and we are preparing for the summit next fall. in my intervention today, i will focus on what i believe is necessary in order to implement the strategic concept from 2010. we in nato have been quite good in creating new slogans, in creating new programs, but we have failed to a large extent to implement it, in my view. and i think those who know nato really well, and i see there are some here, know that the state

of the structures in nato is not always what we want it to be. and i believe, therefore, that correcting some of these things is absolutely the best thing we can do in order to prepare for the unexpected. i'll try to be a little bit more concrete. as we approach the next summit, we need to make sure that nato remains relevant, as you said, and effective. next year, we have an opportunity, because we are going to update the political guidance, used to be called ministerial guidance, and that is the document in which you set the real priorities and the programs for what we need to do with nato's defense capabilities and defense structures. and that is the most important document, in addition to the strategic concept. i think we need to take a hard

look at that one, and i will suggest in order to be brief, only six points, that i think we should look at that. one, we should change our level of ambition. today, the level of ambition is that we should be able to conduct two major and six small operations at the same time. we've had that ambition for a long time, and since we started with that ambition, our resources have decreased tremendously. and we are totally in a different situation today. in my view, we should change that level of ambition dramatically. and i would not change it by saying one plus two or something, but rather describe it in a totally different way. for example, saying that we need to be able to deter and defend the territories of the member countries and we need to be able

to deploy military capability to do crisis management at a certain distance. we need to be able to hedge against cyber attacks, space attacks, perhaps, but we should take a totally new look, in my view, at the level of ambition. secondly, i believe we need to incorporate cyber operations in nato's planning. we talk about cyber, but it is to me at least almost inconceivable that there will be a future military conflict in which cyber doesn't play a prominent role, and i don't think we have really incorporated that into the planning mechanism in nato. my third point is, i think we should establish a general framework for contingency planning in nato so that national defense plans can be attached to and linked to the vital nato operational planning. i'm sorry to say that there is no common policy for contingency

or operational planning in nato today. we had it during the cold war, after that, we had some aspects of contingency planning, but we don't have a general policy covering it. and as we do our national planning in norway, we really do need something to attach it to. one of the unique features of nato is its command structure. we all believe, at least the small countries in nato believe, that in case of a serious crisis, we would ask nato to take the lead and take the command of operations. we are seeing time and again that the nato command structure, as it is today, is not fully capable and ready to take on such tasks. one of many example is the conflict in libya. if we had to send big reenforcements to the air command in italy in order to take on that task to do the targeting business, and i think

we cannot afford to have such a big command structure as we had, say, 20 years ago. so i think the best way to fix this is to create a pool of qualified personnel in the member states so that they can be deployed and support different operational commands if a conflict is arising. this is a cheap, i think, way to reenforce nato's credibility in the command structure. one thing which is also relevant to this regard is to establish an educational certification program for officers in nato jobs. we are now 28 nations. with very different structures and backgrounds, and i think the command transformation do a very, very useful job in training and qualifying

officers, and for that matter, civilians, to take on nato jobs. my last point is that i think we should establish a policy for training and exercises to ensure ability to participate in joint and combined operations. and this policy should cover all elements of our core structure. nato has focused on very narrow categories, like the nrf, for example, but that is only a very, very small proportion of nato's structures. so if we could create a common policy for training and exercises to do that job, i think that would greatly increase cohesion in the military system in nato, its defense capability, and thereby also deterrence.

nato strategic concept entails three core tasks, collective defense, crisis management, and cooperative security, which basically is partnerships. and i firmly believe that collective defense is the basis for the alliance, as described in the atlantic treaty and our credibility in relation to collective defense is for public support in many countries and also for nato's relevance and ability to take on tasks such as crisis management and cooperative security. in other words, it is not possibility to do the other two if you don't do the first task right. that's my point. but i think also when we talk about collective defense, it is very important, as i said, to incorporate new aspects of this, like cyber, but also missile defense and space, policy for space. so it is -- it needs to be

updated in relation to the technological development. there's a lot of critical shortfalls in nato, of course, joint reconnaissance, intelligence, special forces, air refuelling and so on and so forth, but still, i believe that what really makes nato attractive and credible and unique is that it has a permanent decision making machinery. it has a permanent command structure. there's a common force planning and a common operational planning. this builds the credibility, the cohesion of the alliance and the terms. often says that nato is changing from deployed to prepared, and you posed a question, prepared for what? in my view, we must be prepared for collective defense and for international crisis management, both of them.

and i fully agree with what you said about the middle east. we need to also have a situational surveillance, which has been lacking to a large extent in nato. one of our initiatives point directly at the situational awareness and as the norwegian air force was planning to participate in libya, we have to admit we didn't know very much about libya or the surrounding areas. later, we got quite a bit of information from italy and france, but nato as such had also very little knowledge. and definitely nato needs to have a situational awareness for the mediterranean, for the middle east, so that it can make recommendations to the political level if nato can use its forces and policies in a relevant way to solve crises in that region, and the same goes for eastern europe. i think i'll stop there, because

i think i used my time. >> terrific, svein, let me ask you one quick follow up. to dramatically change the ambition of the alliance and for many out there it may sound like a technical issue, but it's an incredibly inordinately political issue, as well. for many it's the alliance looking at itself and saying we are incapable of doing what we said we would do to defend our populations and we need to ratchett back our ambition and expectations of what the alliance can deliver. how do you navigate the shoals? i'm going to turn to an ambassador who had to deal with the politics of this next, but let me ask you real quick, how do you deal with the criticism that this would be an admission of defeat for the alliance in some respect? >> frankly speaking, i think it was never realistic that nato should do six plus two operations almost at the same time. and i don't think many would be

very disappointed if that level of ambition was changed a little bit, because we are not going to do two plus six operations at the same time anyway. it's not credible, and it's undermining our credibility. that's my short answer. >> all right, thank you, svein. let me turn to your left. i'll come back to you, jay, to wrap up with cyber, but let me turn to ambassador stefano, who unlike norway, who had to find its way information about italy, intimately familiar with your neighbors to the south and the instability the alliance is facing from that region. from your perspective, italy is a stalwart member of the alliance but also trying to balance the financial challenges that we've been seeing throughout the euro zone, combined with the reality of instability to your south, something that's quite palpable, obviously, for your country. how does it sound when you're hearing about the concept that

barry's laid out, hedging against russia while still planning for greater ambition in the middle east, preparing for the unprepared, when you have deal with the constraints of budgets and what your populations will support? give us the perspective from the south. >> thank you, damon. it's good to be here. and it's good to be next to norway. i must say, surprisingly, norway being one of the countries i worked the most closely in my time at nato. one from the north, one from the south, and together we sort of match the perspective of, say, european nato. before i get into answering your question, let me just touch on something which was i tried to focus for this panel, which is the relationship between deterrence and collective defense. and i have come to mediterranean, obviously, close

to my heart. i was feeling a bit rusty, you know, five months after leaving foreign service, three years, i left nato immediately after that. completely affirmative in december 2010, we had no clue, no idea that there might be operation, to a point, i was asked, because some might may remember, qaddafi just made a state visit in italy that august. and the agreement with libya could be somewhat, and was, at odds with our nato commitment. but when the question we asked ourselves at the time, could that be a problem? and the answer was, why should ever nato have anything to do with libya? that was just eight months before the operations. so that shows that that kind of unpredictability that you outline.

so feeling a bit rusty, i need some help, i found some help in a young diplomat, who took my seat in the audience, aleczandro. he has a nato-ized embassy here with the former secretary general, who's actually ambassador claudio sitting in the first row. but alexander's help wasn't enough, so i went a bit further in dealing with new tools and new challenges. i got a bit of old wisdom in order, and i found what i think is one of the best definition of deterrence in a phrase from mackiavelli. >> i might just say, he walked in today, i appreciate the pin

you have on your lapel, and indeed, it is a pin of mackiavelli. i thought it might fit into your remarks. >> mackavelli says fear preserves you by a punishment which never fears. that's deterrence. there are guys which there's no punishment. they don't fear a punishment. two sub categories, if you wish. either because they think they will not be caught, that's the case possibility cyber defense, or because they -- the punishment doesn't -- typical, the terrorist is not being punishable. so i think the issue is whether or not the new challenges

there's also new tools, there's a bit less so and issues whether or not deterrence is part of this new tools. i think it is, but it has to be a combination that you imply talking about a portfolio. has to be a combination of cannot be only military deterrence, has to use political, diplomatic, and economic means. that calls, in my view, more reliance on article 4, more reliance on our partners, and what i call engagement. obviously, when i say engagement, it's very much with russia on my mind. the point about -- very briefly, russia, which you mentioned, i

like very much the way you, barry, you pointed out about the issue of hedging against russia when you said you americans' main concern is about a declining russia, which, obviously, is not going to be deterred purely by a military hedge, but with sort of an array of means and on one hand sort of credible, clear-cut military capability. on the other hand, a political outreach to russia. even if the president at the moment, the circumstances are not the most favorable. the issue -- so my take on the relationship between deterrence and collective defense would be we should deter when we can.