heads of state. a meeting organized for the secretary general of the united nations. they came in in enormous numbers to sign. 180 countries signed the agreement the first day it was open. we've never had that. the previous high water mark for any agreement was 70 nations. 180 countries said yes, it matters, i'm going to play and send my that's a huge shift in the politics. that's lead please to be much more optimistic. >> now i will turn to the audience for questions. there is one in the back. if you could please state your name and affiliation. >> thank you. francis bouchard hamilton. thank you for your remarks. you mentioned resilience. there is an immense amount happening in that. g7 work under the germans, vulnerable 20, even in the

private sector, soak tors coming together in the insurance development. i wonder if you could talk about the u.s. priorities in the resilience space, but also, a little bit about the role of the private sector you see. are they stepping in? reluctant? ahead of the curve, behind? >> i think they fall into a couple of different categories. on the u.s. and internationally, there a lot of work being run out of the quality that's really pushing on the insurance fund, on the resilience front. one of the things we're trying do is develop better mapping tools to elevate our understanding of what kind of damages we see already. what kind of damages we might anticipate seeing over the course of the next decade or so. that's involved all the agencies, the president has committed as a government to try to build resilience, its own infrastructure and to support communities as they build their own domestic internal infrastructu infrastructure.

there are resources made available by all the agencies for different vectors. u.s. department of agriculture has farming community. noaa is doing coastal and weather information, risk maps and potentials. department of commerce has been deeply engaged with medium and small enterprise. the interior department has a whole series of departments managing land and land structures, the corps of engineers, looking at the flood zone mapping and how it does deployment that they are responsible for. that whole suite of things is underway. here, ultimately, it will end up being largely private driven. we're seeing a mixed story here. it is much less evident that people have begun to make the investments required to build adequate resilience. it is a little slow. people tend to react after the fact. will we change some of the laws we have to change to modify the

structure. so for example, fema will provide you with insurance that will pick up the damage costs for various kinds of weather disasters. you know what they pick up, exactly what you had. they don't actually pick up the cost of the improvements to make it more resilient. there is good reason for that. the idea was not to have the federal government to defray your fancy new space, but the problem is that now in this new world, you want to make these improvements on an ongoing basis and we haven't put those systems in place. the other end, the private sector, interesting things happening. i'm struck by some of the largest companies, walmart as an example, duke power. i'm seeing real change in the way they're making their own deployments of their own assets to build into their infrastructures. walmart is doing it for logistics, things being cut off by storms, power sector, building new capacity forecast tal intakes of water, heat

stress. those things are beginning to be rolled into the flanning structure. on the international side, it is not any easier, but more diverse community. there is a lot of work underway being run by uside. we've got a series of what will ka called national adaptation, paris deal has between 2 and $3 million per country per developing country to help them put in place a series of national plans. and organizations like usaid actively, and design to make them more robust. others, germany, uk, japan, all supports these endeavors. we're seeing an increasing level of attention and focus on that. the idea ultimately is to think about a balance between the adaptation that's provided in order to address exactly this problem. coral mentioned there are a

small number of countries responsible for the emissions. 75 to 80% of emissions. you have another 180 countries that didn't do much, but that's been a concern that you see in the process in a negotiation, in the convention discussions, and that's the community that needs this kind of support to help them out this bind. >> great. next question, there is one right here in front. >> thank you. >> again, don't forget your name and affiliation. >> yes, albert nahas, thank you very much. great moderation. excellent speech. i note there were a little feel of chagrin and despair that there is a very strong anti-fossil full balance, which i understand. but the u.s. has reduced its greenhouse gas emissions after

key oi kyo kyoto. natural gas is well poised to help developing countries afford cleaner, less emitting until the development of renewables. you mentioned saudi arabia, but two gulf countries have already imported u.s. base natural gas. is there going to be any effort at 22 to put natural gas in a different basket where the other fossil fuels as one that is actually reducing emissions, while maintaining current levels of electric power generation? >> so the answer is no. but for some what different reasons than perhaps you might think. it is not so much a function, and i hope i did not come across as being anti-fossil fuel. i want to come across as

anti-carbon. it plays out in a series of different solutions. one of which is to move yourself from high emitting sources to low emitting sources. in that transition, clearly for the united states, it has played an absolutely central role. there is no way we would be down as far as we are if we didn't have gas in the mix. if we weren't in fact phasing coal out and replacing it in many cases. the price is clearly competitive and has declined sharply from a we were at $13 and we're now less than $4. the structure, economics and emissions work hand in hand in this regard. approximate if i look at 2050, gas will have to be captured and stored. to me, it isn't whether gas is good, it is whether carbon is good and how i manage that part of the equation. so for me, capture and storage become ans essential technology. one of the thngsings i worked os to generate that kind of capacity.

i also see a variety of needs for backstop technology. at the moment, we have a supply requirement -- supply generation in terms of wind and solar. what's the model or quick ramping up electricity, the single best choice is gas. no other turbines work that great, and how do you marry these questions in a much more complicated system going forward. that's the exploration that we have to do, that's the kind of model that we have. in all cases, if you have a high carbon footprint and that footprint will get smaller and smaller and smaller over time. it will not work. it won't solve the problem only with gas. we'll save wicarbonzation. >> time for one more question. there is one here. >> chris holly for the energy daily. jonathan, i wonder if you could

give us a sense from the u.s. perspective what is the best realistic outcome of amercash conference. >> i think there will be three buckets to which i put the discussion. the first one is going to be a recognition of the things, because of the first political meeting on the climate side since this whole suite of outcomes. since montreal, since the kigali and so what does that mean? come together and reflect on that new world dynamic. the second, paris itself has a priority of explicit obligations that it incorporates. we are now, by the first meeting of the parties, a series of technical tasks, they wouldn't be done by this meeting, but there will be an accelerated timetable and a degree of urgency. people will be sitting down and doing the negotiations. and the third is a structured set of discussions on what the

moroccoians are calling action agenda. they'll have discussions on everything from energy, which gas will certainly play, but so will renewable and efficiency and a variety of other sources. theme day on water and agriculture, theme day on forest, theme day on finance, theme day on adaptation. a series of these where senior figures around the world with expertise in each area will begin moving us away on the discussion on implementation. it is a big shift. paris was negotiation. morocco started phase two, the implementation phase. >> i'm going to grant myself the privilege of one final question. do you anticipate a morocco document, where this will be ascribed. it sounds like, you are describing discussions. >> i don't know yet. that's a good question. it remains to be seen.

i could see some of the pieces coming out in the standard form that we've always had from these agreements. so you have to have a decision with a timetable. you have a decision with the program of work. you have a decision recognizing conclusions that have been reached that will be captured by parties for the paris a greechlt th -- agreement. will the first decision, cp1, that comes out of morocco, be a political statement. i think it will be. how much will be in it. i think that's going to be a function of these discussions. how do you recognize progress we've made but don't rest on your laurels and demand the next stage. historically, the host country has wanted a document. the paris agreement, the lima accord, the dava in south africa. even one has its own structure. i think that's something they would want, this is what

happened at our conference. we can look back at pride as the host and endorse that effort. >> great. thank you so much. we're out of time. great conversation. really appreciate it. [ applause ] i want to thank jonathan and coral for this incredible discussion. great moderation and great questions from the audience. thank you all for being here, and we look forward to your coming the next time on our next program. once again, let's give a round of applause for jonathan. [ applause ] tonight, hillary clinton is

going to make her first public appearance after losing the presidential election. it gets underway live at 8:00 p.m. eastern on c-span 2. also tonight, the national book awards taking place in new york city and hosted by comedian, larry wilmore. our cameras are there and we'll show you the event on c-span 2, book tv. this weekend on america history tv. saturday night at 8:00 eastern, lectures in history. >> the only essential difference between nazi mob hunting down jews, is one is actually encouraged by its national government and one is just tolerated by its national government. >> gettysburg and its impact on

civil rights. then at 10:00, real mark, 1968 film on the black panthers auto years ago. >> and so it is very apparent that the police only enact unity. not for our security, but for the security of the business owners and the community, and also to see that the status quo is kept intact. >> sunday afternoon, about 4:30 eastern, dean snow on his findings while excavating the revolutionary war battlefield sarah towing ga in new york, and inspiration, 1777, tipping point at saratoga. >> what was the little old lady doing out there. at the time she died, she was five feet tall, and a battle casualty at saratoga. what is going on here. >> at 6:00 eastern, american artifacts. >> they put you in a little thing with the wings cut down. your second training flight, they give you more wing and a

bigger engine and you would literally hop up and down the field. when you're ready for the big day, talk to your instructor, who had been talking to you on the ground, he would pat you on the shoulder and go bonshaunce. >> pilot, robert boom powell, tour of the aviation museum, world war one and two aircraft. aviation technology during those wars. for a complete american history tv schedule, go to c-span.org. i've always been a grid of america, a student of american history. particularly, the history of its african descendent people. >> sunday night on q & a, talking about his memoire, never look an american in the eye,

flying turtles and the making of a nigerian american. >> my uncle formed this impression from watching siand would never understood what he was saying, but at one point, they would tear each other down and start shooting. so my uncle formed that impression, that's what americans would do to you, shoot you, if you looked them in the eye. >> sunday night at 8:00 eastern on c-span's q & a. sunday night on afterwards, auth other sebastian mallaby, former federal reserve, alan greenspan, brookings institute, senior fellow of economic studies. >> alan greenspan an unusual upbringing, raised in the 1930s,

the child of a single mom. his father left his mother when alan was only 3, and then this sort of distant figure, unrely able, sometimes see his son and not show up. i think that reenforced a tendency that alan had that to live inside his own head. >> go to book tv.org for the complete schedule. defense and intelligence leaders took part in a recent panel discussion on defense innovation. speakers included joint chiefs of staff, vice chair, paul silva, robert work, and principle deputy director of national intelligence, stephanie o sullivan. third offset strategy, an initiative which seeks to identify techologies and capabilities in the military. this is an hour.

good morningstar, everyone. welcome to csis, and to the third offset conference that we are holding today to talk about what the third offset is, assessing its progress to date. the challenges to going forward. and what maybe in store for this issue set that the third offset raises into the future. i'm so pleased to have opening the conference, the three of the architects, if you will, of the third offset and implementation. collectively, they constitute something you may not have ever heard of called the advance capability and deterrence panel. and so i get to be the moderator of the advance capability and

deterrence panel, speaking about defining the third offset. let me begin brief introductions and have each of the panelists speak and then a little conversation on how it is defined and how to think about it in terms of how it shapes government activity. all the way to my left is the honorable robert work, deputy secretary of defense. to his right is general paul silva, general vice chairman of the joint chiefs of staff. and then to my immediate left, stephanie o sullivan for national intelligence. let's begin with the main architect, deputy secretary work, i wonder if you could talk to us a little bit about what, you know, when you first conceived of framing this issue set around third offset, what is the issue you were seeking, and how do you see third offset as a

frame being helpful in implementing department's activity as soon as. >> well, first of all, i would like to think csis and dr. henry kapp for hosting us today. i can't take credit for it. i traced the thinking back to 2012, when secretary carter, who was then the deputy secretary of defense, established what is called the strategic capabilities office. and it was motivated by the exact same thinking of what i'll talk about. that was followed by a very important presentation that secretary carter gave to the national security council on the growing threats and vulnerabilities to our space constellation. and so when i came in, the job of the deputy secretary, the primary job is to fashion a defense program that is in concert with the secretary's strategic vision.

that's what we do. paul and i chair what's called the deputy action management group and we try to make a cohesive program. let me tell you what the third offset is all about in tagging a defense program. it is not a unified field period. it is focused on one thing and one thing only. conventional deterrence. it is designed to strengthen u.s. conventional deterrence to hopefully avoid ever any major confrontation with any major state. its focused at what we call the operational level of war. think of this as the theater level or campaign level. it is not focused on tactics. it isn't focused on specific exchange ratios. it is really focused on having an advantage at the operational level. from a historical perspective, since world war ii, having that advantage is the surest way to

underwrite. people always ask us, offfet for what? we'll talk about that, i'm sure in the question and answer period, but the first place you start with is your pacing competitors. the competitors who are developing advance capabilities, and you want to start your conventional deterrence approach focused on those pacing competitors. the pacing competitors, not adversaries, the pacing competitors are russia and china. they're developing an awful lot of advance capabilities that potentially worries us. now, what are we trying to offset. in a case where we are projecting power across the -- across the oceans, most of the combat power of the united states is now resident on c-- s territory, continental

territory. that's different than the cold war, when we had a lot of horses forward and the theaters they were expected to fight. the second thing is offset strategies. always happen when are potential competitors reach parody with us, and they have in what we would determine battle networks. theater wide battle networks. it is a censor grid that looks and sees what is happening at theater, command control, communications and computers, an intelligence grid that tries to make sense of what's happening and what type of effects would we like to achieve. and then an effects grid which tries to achieve and then a logistics and support grid that keeps the whole thing running. so both china and russia now have battle networks, theater wide battle networks that are

approaching parody with us. we want to make sure that we can extend our advantage in that particular area. the third thing is, both our advance pacing competitors have put a lot of money in counter network operations. because they know how powerful our battle networks are. they spend a lot of money on cyber capabilities, on electronic warfare capabilities, and on counter space capabilities, because our space constellation is an important part of our ability to put these battle networks together. when you hear those three things, not a lot of forces in the theaters, they might be expected to fight, guided munitions and battle networks parody and counter network operations, the shorthand for that, we refer to in the pentagon is a2ad, it is the shorthand.

for those three objective facts on the ground. and so what is the offset then, that's what we're trying to offset. we're trying time prove conventional deterrence and wha we believe is the best way to go about this on the initial vector. the initial vector. the third offset doesn't have a destination. this is as the vice chairman always says, this is a journey. our initial vector is to exploit all of the advances and artificial intelligence, and insert them into our battle networks to achieve a step increase in performance that we believe will strengthen conventional deterrence. it is not about technology, however. it is about operational and organizational constructs based on doctrine. based on training. based on exercises that allows the joint force to operate with

these type of technologies to achieve an advantage. it is also an institutional strategy, secretary carter will talk about that a lot in his presentation about how we're organizing the entire department of defense to compete in this new dynamic environment. so i think that is where i'll stop. because i want to get to your questions. but again, the third offset is not a unified field theory. it is folk isscused on one thin. strengthening to make sure wars don't happen. >> thank you, i wanted to get your perspective from the operational and joint combat side in terms of third offset and its value as a frame. >> you bet. so just to make a couple of points to expand on what the secretary has already said. first, the third offset isn't an answer. it's a question. it questions our ability to be able to offset advantages we see

emerging in potential competitors forces. i always describe it as a journey, not a destination. if it were a fixed point in space we could navigate, i would drive them into the oversight council, mandate them in every acquisition program that exists in the department and i would impose them through the chairman on all of the services. except it is not an answer. it is a question. and by asking the question, and repeatedly asking the question, what are the advantages that our adversaries are accruing over time what, threats do they pose to our field forces and can addressing those threats strengthen conventional deterrence. i think we're asking the right question. the way you take it and turn them into doctrine is through operational experimentation. that begins with designing concepts, testing them at war games and ultimately testing

them in exercises. so from an operational perspective, the journey we're on has the potential to vastly increase the effectiveness of our conventional forces. but we have to ask the right questions. we have to experiment, to our partners, our allies and friends, and figure out how to offset this capability that all of our competitors are bringing to the conventional battle space. which is in simple terms, long-range precision strike at volume. in space, in cyberspace, in the air, on land and at sea. now, we can sit back and say we invented long-range precision strike, and that would be true. but everyone who wishes to compete with us has read our

doctrine. they've watched us in battle. they've analyzed our strengths to find a ssymmetrieasymmetries. i'm really interested in your questions, so i'll stop there. >> so if one thing is not like the other on this panel, you are not a department of defense employee. you represent the intelligence community. i would love to get your perspective about how you all have come to be partnered with the defense department and how you think about third offset. >> so from the moment that the department started talking about third offset, it deeply resonated in the intelligence community. we share a world in which the threats are changing. and which counter measures are always advancing as well. eroding collectively our national security advantage. so from the time that we can --

we doe ploy a new capability and increasingly with cyber, from the time we conceive of a new capability, our competitors, i had adversaries, i changed it, our competitors are working to counter that new capability. so in my view, from the ic, and for the ic, if we are not changing, if we're not driving our own offsets, we are seeding ground. we are losing our ability to inform policymakers from the oval office to war fighters and oval shaped fossils if you will. so i just don't believe for the intelligence community and support of the department or any of the policymakers we support that not changing is an option that we have. >> great, thanks very much. well, let me, if i can, hope to evoke a little conversation among you on this topic. again, you all see each other

probably in various venues, but we don't get to hear the dialogue that we help to get a piece of today. secretary work, if i could start with you, one of the things some people will say about third offset is all well and good to look at russia and china, but there are a lot of other issues going on. the american public is concerned by isis, homeland security. there are many, you know, in other words many operational challenges out there. what are your response to that in terms of the third offset plays within the broader defense strategy? >> well, i knew this question was going to come. i didn't know whether it would come from cap or the audience. this is a question we constantly receive. i have a couple of slides. no. >> always good to be the straight man. >> okay, so i would like you to look at the top part first. when we say we're injecting ai,

autonomy into the grids, we're looking at five different things. autonomous learning systems, learning machines that can crunch big data and can see patterns that humans simply cannot see. and they can reveal those patterns to the humans, and they affect the ic, i'm sure stephanie can talk about that but they will increasingly impact operations. human machine collaborative decision-making is providing fused information, advanced visualization, coupled with machine to machine communications with humans being in it that allow humans to make more timely relevant decisions. we refer to that as human machine collaborative decision-making, with human at the beginning. it is not machine/human collaboration. it is human machines. machines using humans to allow them to make better decision. assisted human operations, this

is providing as much information to the individual in the battle network as possible. that they can pull this information to allow them to make better decisions at every level. it also is some physical assistance, such exco skeletons, disposal right off the soldier. that's what we mean by assisted human operations. advanced human machine combat teaming, you see this all over the place with manned and unmanned systems working together. the final network enabled autonomous weapons and high speed weapons, like directed energy, electro magnet guns and hydro sonic. all of those things will be injected into the censor grid, into the c 4 i grid, and the logistics and support grid allowing a big performance

impact. again, it is not about the technology per se. it is how paul goes from the process saying here are the requirements to the doctrine developers, who say this is how we will use this to exercises in the field to train our forces to fight in a new way. that is what we are talking about on the third offset. so people always say, yeah, just like cat said, why are you focused. we're fighting isil on a day-to-day base. why wouldn't you focus there. i have the yankee slide. this is a white board, this a white board writing, the bottom lower right, you'll see ya 1, code name yankee 1. came off a mission in 2003. he stacked up his special operators on a specific target and he said, look, i need to bring the entire power of the

battle network to me at this point in time to accomplish this effect on the battlefield. and he sketched out, this is what i need. i need flair forward looking infrared. i need imet, i need it all connected and i need it connected to me. the five areas that we are doing, battle networks are scaleable, from micro to the operational level of war. this is completely transferrable across the full range of military operations. let me give you a concrete example. now what, this is a learning machine that was trained to look across all social media, i mean all social media. and that is the story of the mh17 shootdown. on the lower left, there a twitter shot of mh1 taking off.

the next one is paris match.com. the picture of the russian sa11 launcher, with a serial number, date and time stamp, near the village where the shoot down occurred. then on belling cat.com, exact serial number in the very same location. then there is a twitter shot of a con trail of a missile riding at the time of the shoot down. then a rebel leader takes credit for the shoot down on bk.com, immediately taken down by the way. and finally, on youtube, a picture of the same sa-11 with a missile rail going back into russia. learning machines did this without any human interaction. if we had had this capability at the time of the mh-11 shoot down, we would have been able to prove in my view this truly was

a russian missile provided to the separatists in eastern ukraine and they were responsible for the shoot down. this type of stuff will allow us new indications and warning in gray zone operations, the little green men. learning machines can say there is an influence operation going on. we don't know who's doing it, but here are the key themes. so there will be new means of inw, new means of going after terrorists, new means of operating against regional policies, new ways of great state powers. this is totally transferrable across the range of operations. >> anyone else want to comment on that? >> let me give you a simple question. because everybody pushes back on this notion of ai and algorithms helping us do what we do better. it is not a military example. i'm a horrible guitar player. but i play my guitar every night

for an hour. you know there is an app that can take an algorithm and decode a song and give you the cord progressions, and let you play along with the band. so my wife's new favorite party trick is to pull the app out, hand me my guitar, pick the title of a song i've never heard before, and ask me to play it for dinner guests. which is a little bit of torture for them. it is always a surprise for me, but what's interesting is this algorithm is 90% accurate at picking out the core progressions on any song you put into your computer. it makes me better at what i do. all of you, sometime today, will interact with the piece of artificial intelligence that makes you do something a little faster, a little better, a little more efficiently.

we have not to this point harnessed the capability of that part of our i.t. inventive and innovative community and applied it to broad military problems. we have in very narrow spaces. and part of what we're trying to do with this question that we're asking about the potential for third offset is to simply plant that question in the minds of the people that work for us. is there a better way. if there is a better way, can you assist that operation by taking your intellectual effort and putting it where it is most value added and letting machines do the rudimentary work for you. i think there is great promise in that space, but we have to be willing to take that step. >> so as they pointed out and you just illustrated, we're all

swimming in a sea of information, and our analysts in the ic are charged with pulling out from that sea of information. indications and warning in a world that has -- pervasive instability has become the norm. and what these learning machines and capabilities allow us to do is to see patterns to do sense making, movement and imaginary, to pull out triage documents or things in foreign languages so you can rapidly pull out the key pieces of information or to see patterns that weren't there before in all sorts of information, when you add it all up. above all, it would allow us to enhance our trade craft, look at hypothesis, so we pursue that intelligence holy grail of not having bias in the analysis and assessments we present.

>> i think one of the other things that often comes up is this idea of the a kbchille's h, our strengths and weaknesses, tragedy, the more we are informati information enabled, we've had recent cases where the ic has come together to say, for instance, in this one most recent case, the russians are responsible for hacking, we had korean hacking, things like that before. obviously, operator in the battle space, this is a real concern that the military deals with routinely. how do you deal with this, to the degree to which you can leverage artificial intelligence to enable everything you do. >> well, i have a technology

background and one thing i've known from the beginning, when i first started working in the intelligence community, all technology is a double edge sword. it is both an opportunity and a challenge. all of these things that we're talking about can present new operations. we've been talking a lot about biology, answers in biology. the fact that that could make huge advances for human kind, it also poses unscrupulous hands immense challenges for societies. basically, what is really hard for us in a business of learning about threats and what's going to happen in the world, is that technology is changing so fast that it's challenging and stressing governments and our societies ability to adapt to the changes it is bringing. that's part of what is driving the pervasive instability i was talking about. when we look at every single new capability, it is with both

sides. here is how you can use this technology to advance our capabilities and here is what it is going to mean as a challenge, whether it is a direct confrontation by competitors, or just what it needs to government's ability to handle the change. >> secretary work, you wanted to comment. >> from an operational perspective, we worry about this all the time, too. the best example i have, in war gaming, over a long period of time, kind of two schools of thought develop. one school of thought says, look, your adversary will try to break up your network, sever the connections within the network, try to blind the network. and so we take that as a fact. all of our exercises now are starting to inject what happens if you lose global prepositioning data, gps data. what happens if your communications links are severed. what do you do. we're training on this all the time.

but there were two schools of thought that developed. one was, look, you have to fight to keep your network intact. you have to try to keep all the connections there, and you know, you really have to work on the network. then there was another school that says fool's game. the network will dissemable. with thin line communication, you need to operate, with thin connections between the force. and so that second school of thought is the way that animates us operationally. that's why we're training the force. and i know we'll get there, but that's one of our key advantages. our assumption is that a young man or woman who grows up in a democracy will have an inherent advantage over young men and women who grow up in an authoritarian regime. we expect and rely on our people

under mission type command to continue to operate. that's how we train the force from top to bottom. so we believe this is say very, very big advantage. >> let me give you a current operational example. two forces use the same kind of data links to do two different things. in western military forces, generally, we use data links to network the force and allow people to see across that network what everybody else sees. so that broadview of the battle space allows our forces to collaborate and maneuver together. in a country that shall not be named, data links are used to issue orders to individuals. so central leadership believing that they have the best view of the battle space issues individual orders to individual portions of the maneuver element, using a similar system

of data links. so in the case of the western network, it actually degrades gracefully. in the case of the competitor network, if you can shut down the network, their forces don't know what do. because they are conditioned to react to orders. so when you talk about the networks that we might build into the future and the dependencies on vast arrays of data that move through those net works, we have to tend to the resill yen see of the network and the resiliency of the force that subscribes to the network. so when we exercise without the precision navigation and timing of gps, or without the connectivity of the network element to element, we're ex exercising the maneuver elements within that force. typically that does not happen

in thauthoritarian organization that believe that central command is an absolute. now, can they adapt? of course they can. we better adapt faster than they do. part of the requirement that we see going into the future for these networks is both ack -- accessibility and the third part of that discussion is in the absence of the network that resilient force has to actually disassemble and continue to operate. so we're going to work that. >> general silva, you hit on something that has come up in secretary works' comments as well, how you institutionalize this. the department has a rich history, some very good examples, some maybe that didn't seem to pan out in terms of trying to drive-in novation, particularly from the center. and then examples of course of

innovation arising if you will from the bottom up. what is your assessment of how well the department today is organized and culturalated as a challenge for the future? if there are areas where the department could do better, it would be great to hear about that. >> as a general principle, i would suggest we're fought organized for innovation. >> yeah. >> now i'm going to refute that proposition a little bit. so where our organization, the entire organization, and that is, every part of the government that reacts to national security threats, is in fact organized to innovative. is when we see a compelling threat. when we see a change in the dynamic between the competitors who might become adversaries, and our current state of play. and we have identified that a

threat to our ability to prevail in the battle space that threatens the stability of conventional deterrence. we've already talked about it, long-range precision, strike at volume. countries that would counter our ability to project power in an effort to preserve their view of their influence over their -- that means holding us out of the pacific, it means moving us to the far reaches of western europe. so that we can't defend our nato allies. and those are conditions we cannot allow to come to pass. so when we see a common threat, we all move to figure out how to defeat it. and so in that respect, we are in fact organized to innovative. what we don't do is innovation on a micro scale. innovation on a micro scale happens in industry everyday. it is healthy. it is how industry makes step

function changes in the services and the capabilities that they bring to us in the commercial market. i've used that nalis underbrush. it fertilizes the ground and good things sprout and grow. it's something important as national defense and national security. innovation is treated like a forest fire. we bring out the fire brigades and we put it out because innovation on a micro level tends to threaten institutions. part of what we've been able to do, the three of us, the advanced concepts of deterrence panel, is reach very deep down into the services and find common cause in this particular thread. and we have all of the doctrine development centers and all of the war gaming laboratories in the services spending a portion of their energy trying to decompose this problem and come

up with new ideas. and we've even put money behind it, so we have a war gaming incentive fund and we have a war fighting laboratory innovation incentive fund and we provide grants to the services when they're ready to do experiments and when they're ready to do innovative war games. i think we have organized to innovate, but i will continue with my pitch that at a micro level innovation can be a little bit unsettling for us, but at a macro level, at a strategy level when we're looking out into the future, our military has shown, our defense enterprise has shown, we're incredibly innovative. >> i want to give a shout-out to my uniformed battle buddy here. the third offset is all about operational organization.

in 1975, the u.s. army said we are going to own the night. we are going to complete the entire transition of our force to operate 24/7, 365 to maintain a operational tempo and press the enemy 24 hours a day. 1975 anybody could have bought night vision goggles. they were kind of clunky, heavy. they weren't all that great. it was all the tactics, techniques, and procedures to allow the squad leaders to control a squad quietly at night. it was the company commanders and battalion commanders, and in ten years the army owned the night. so the innovation i look for in the third offset is not how fast again someone can get a specific innovation into the fight. that's easy.

but having the operators trust that innovation and knowing how to employ it is the key, and that is where we really do, i think, are pretty darn good at operational and organizational innovation. >> so i completely agree. it's not just technology. it's also how you operate things. so you could argue that for the intelligence community one of the first offsets was the overhead constellation and the tremendous insight that that brought to our policymakers and war fighters having that initial capability in constellation set up. we involved a way of tasking the satellite that was very much based on how precious they were, and we competed and we had much debated targeting decks. but what technology is giving us today and the new tactic we need to embrace is how we can do tipping and queueing via

automated talking between -- across the constellation, and we can get much more capacity out of that which we already have than we do today, but we need to embrace the change and the way we allocate those resources which is a cultural and a bit of a challenging change for us. >> what i'd like to do now is open it up to the audience for some questions. let me give you some rules of the road. there'll be a microphone that comes around. when we call on you, we'd like to hear your name and affiliation if you have one. the first it should be a question, not a statement. and the second is it should be on topic. we purposely pulled this day together to have a focus on third offset and the issues around it. and i'm just going to move to the next question if it is on a different topic. with that, please raise your hands if you have a question you'd like to ask. i have one right here.

>> i'm a partner at a law firm. first of all, let me congratulate you all on the dii and the focus on particularly bringing technology to the war fighter, which i think has been well overdue at the department. one of the key premises is technology has proliferated and eroded our prior offsets. in that context, what is the basis to assert that autonomy, a technology that hoolooks to me e it is going to be pretty ubiquitous is going to be the basis of our next offset? i don't mean to be glib, but i understand how autonomy would be one element of a future force. but what's the basis when giving a sustained overmatch based on that? >> well, first i'll start with your last point. we are not arguing that we will

have a sustainable overmatch. this is a very dynamic environment. two examples. the rifle, telegraph, railroad revolution, and war. ai and autonomy are very much like railroads and telegraphs. they were being driven by the commercial sector. it changed our society, and as a result it inevitably changed the character, not the nature of war. ai and autonomy is changing all of our lives. as the vice chairman said, at an astounding rate. it's happening so fast that sometimes we don't even notice it. this is going to be a world of fast followers. what we have said, jeff, again is it's not so much ai and autonomy. it's injecting it into our battle networks and allowing our battle nets to work better than our potential competitors. and we believe we do have an advantage in ai and autonomy on

the operational level of war at this time. we think we might be able to have an advantage for sometime if we move to operational or organizational constructs, but we're organizing it ourselves temporarily. we may only have an advantage for five years. so you better be thinking about the advantage you want to create in the next five years and the years after that. we're thinking like a competitive business where the market is constantly changing and you're having to adapt. again, we know that ai, and autonomy will vastly improve the power of our battle networks. we know that our competitors will probably conclude the same thing. in a world of fast followers, as long as you're a fast leader you have an advantage, but you always have to be thinking about what happens when we achieve parity and what's the next step. >> i also think we need a broader view of what autonomy

is, just to pick on your point of cars that can drive themselves. that's interesting, but it barely scratches the surface of what could happen if every car was part of a network. if every vehicle on the road subscribed to a network that optimized our traffic, my guys wouldn't have had to go to lights and sirens to get here on time. >> i will say washington traffic is the best anti-access area ne network in the work. >> having spent a lot of time with people who think critically about artificial intelligence and autonomous automation, every one of them would tell you that we are barely scratching the surface. we are now only beginning to learn the promise of these potential technologies for the future, and that's why i say this is a question, not an answer. if we locked into systems that

are not adaptive, that can't continue to bring in new information and new networks, if we don't truly build resilient open architectures, what we'll doom ourselves to is a fleet of singular autonomous things. and we won't be able to adapt. so at the heart of your question is of course autonomy is going to evolve over time and we have to evolve with it. the current advantage we have in the battle space is born of technologies that are 40 years old, born of concepts, tactics, and procedures that while they have evolved are largely 40 years old. we're not going to be able to sustain any kind of advantage over potential competitors in an environment where software applications and machines allow organizations to adapt quickly, so we really have to get to the

heart of your question and sort out how deeply we're going to look into this problem, how far we're going to predict our capabilities are going to be, and how adaptive we're going to make the architecture. i can't tell you how many times i've asked the following question. will your widget subscribe to an open architecture? answer is always, yes, sir, of course. we built an open architecture. i say wonderful. here's an application i would like you to put into your widget to make it more useful to the military, to the service that ordered it. oh, sir. we can't do that. it is an open architecture, but only inside of our company. or only inside of our proprietary ip that's in the system. we really have to unlock the potential, and the only we can do that for ai and autonomy is to find a resilient open

architecture to which all of our systems can subscribe, and we've only scratched the surface on that as well. >> i'd just reinforce that by saying that asking that question is like asking the question the way that machine first came out. this is kind of interesting, but what is this going to do for us? we're right at the beginning, and we can't see all the possibly places that it could take us, but we need to remove the barrbarriers to allow it to explored. >> next question. i have one right here in the middle. there's a mike coming hopefully.

>> thank you. my question is the first offset basically benefitted from the national security act of 47, the second from goldwater's nickel reform. what's the statutory reform coming that will help realize all the advantages in the third offset? >> i don't think we have to reorg to do this. i would challenge your premise. i would hate to do that in a group this bright because i'm not the brightest guy in the room, but those offsets were not just the product of changing our national security policy apparat apparatus. the american peop i would suggest to you the big part of the first offset is we found a relatively inexpensive way to miniaturize nuclear weapons. that posed some very serious

questions for our national security leadership. in the mid 70s, we realized that precision would get us to a different equation in that same battle space. by the way, some of our competitors say we create nuclear effects with conventional weapons because of our precision. that is so wrong. we create the operational outcomes with precision munitions that our competitors ascribe to nuclear weapons. there's a huge difference in the way you say that and what it means. that means we don't have to deploy all that fire power in the battle space in that configuration. by the way, it wasn't just precision. it was stealth, precision, and a sensor network that gave us indications and warning to make that capacity useful in the b t battle space and we reorganized

around it. those were the seeds of airline battle. we reorganized concepts around it. we didn't reorganize our services around it. the compelling issue with goldwater nickels was we had these services that were very, very capable of working together, but we didn't have an organizational construct to encourage that. so goldwater nickels was born. i don't think we're making that big a shift in what we're doing that causes us to have to reorganize the national security apparatus of the nation. are there places where we can trim and tweak on the edges? yes, but last night i find myself describing the defense department as a diamond. it's already been cut. if you polish it, it's only going to make it brighter. and what we're doing right now is polishing the diamond. >> okay. i have a question right here.

>> first of all, thanks to csis for arranging this discussion. where do allies and partners fit into this equation? >> i will just free advertise to say we have a whole panel on allies and partners say. we welcome your guidance to that panel. >> we have many of our close allies here, norway, united kingdom, japan. there are many others, and this is what we would say. the first advantage we believe we have, the competitive advantage, going back to the ai question in this world is we believe our people within the framework of what we're trying to accomplish provide us an enormous advantage. second thing was talked to by paul. jointness. jointness is hard. it takes all of the western armies and our armed forces to a

greater or lesser degree are going more towards joint solutions. why? because your battle network, if you have discreet functional networks, it will never operate as well as a cohesive joint network, so we're very -- 30 years since goldwater nickels, so we have -- and our competitors are trying to copy us in this regard. the third thing you hit on is our allies. we believe in our national security strategies that alliances are absolutely central to not only our security and our partners' security but to global security. if you compare us with our potential pacing competitors, they don't have a lot of allies. we do. so from the very beginning, we have been talking with our partners and our allies about how we work this together and the way we describe the third offset is very coalition friendly. the second offset the coin to the realm was a mechanized

infantry battalion or an armored division or a heavy artillery battalion. now anybody can come up with an application on ai and autonomy in any one of the domains and it improves the power of the entire network. so this is very coalition friendly. we're thinking of it from the very beginning as interoperable, exchanging data from machine to machine, discussion to discussion. so far all of our discussions have been very fruitful. >> well, clearly, we're in the midst of what director clapper brought to the ic, which is integration. and i would argue that that's our current concept. ingratie i intergrating all the pieces we have, fully leveraging what we have, and working deep with our

partners is foundational to the advantage we've gained, that we can pool together what we already know. as far as the risks involved, sure, but it requires the additional work to think about what we're sharing. it's not an open kimono everything. that's foolish. but it's opening and engaging and how can we best leverage and help each other. and we're doing all this structural work to make that possible. i won't go into the details, but it's largely in the way we're structuring our i.t. systems. it's tagged and labeled so we can more easily share it. >> okay. more questions. all the way over here. there's a young lady in the second row back, yes. >> good morning. thank you again to the panel. so there are a lot of pieces o

to the puzzle you're putting together in regard to innovations in the defense department. some of the resources i have observed is how you articulate your return on investment to doing better or to doing faster or an increased level of fidelity with the data points you have. how do you articulate return on investment now and how do you keep kind of the wind at your back when the pentagon doesn't actually have a competitor where the war fighter can go for a different level of service if they're not getting what they need? >> i think you'll hear from secretary carter in just a few minutes on how he has tackled this partner as far as the entire innovation agenda within the department. but let me just say the way we'll determine return on investment is through the operators. the second offset took life when the army and the air force got together and conceived a battle,

which employed the technologies. and within a very short period of time, by 1984, the soviet general staff said this has completely unhinged the way we were thinking about the fight. so what we will do, paul talked about a war gaming incentive fund, where we look to incentivize new concepts to bring in technologically operational constructs. then we incentivize the concept developers and the doctrine developers to develop it further. then we do exercises. it will be the feedback from this loop on how it improves the performance of the joint force that will tell us the return on investment to tell us we really should go this way. we are making modest investments, a lot of levers, a lot of tests, a lot of

demonstratio demonstrations. i've stole paul's line. this is a journey. it's not a destination. so the return on investment for us is going to be when the army, the marines, the navy, the air force, and our allies come back to us and say this is the real deal. that's where we'll really start to pour our money. >> this is about the force taking ownership of the question. i'm very, very, very suspect of hard objective criteria that we can advertise as success. and i'll just make up an example and you can push back if you want. ddg 1,000 is an incredible ship. she's stealthy. she's smart. she's networked. she's resilient. and she's ten times more lethal than any competitor's ship of the same class, to which somebody who just crunches numbers for a living would say you wanted 20, so 2 will do.

we have a history in the department in the services of taking the subject of outcomes of war games before the services have taken ownership of the tactics, techniques, procedures, and doctrine and advertised them as success and it hasn't been fruitful. so my view is i think the same as the secretary's. when i have soldiers, sailers, airmen, and marines echoing back to me in their work spaces, in their units, in their maneuver elements they're seeing the benefit of this kind of thinking, then we win. and that's where the return on investment comes from because we can experiment and knit things together in different ways. it'll be viewed as a bright idea unless it makes a difference on the deck plates and that's where

we have to go. so i would use the same measure when we have articles in our professional journals, when we have commanders responding, when we have the war centers putting in the exercises and bringing us the ideas of the young men and women in uniform. that's the return on investment. >> we would not have gps today had the creators listened to what was called c.a.p.e. someone said the return on gps is hard to calculate and therefore you want to kill it. bill perry was in a helicopter and he was in the middle of a kind of really dicey whiteout/brownout situation. that helicopter just happened to have an experimental what was then called -- it wasn't called gps at the time.

the pilot landed and perry said i did it all by gps. what is the return on investment being able to time sync an entire battle? it is hard for us to tell you. when we get into operations like desert storm and say whoa being able to time sync everybody and being able to do guided munitions attack 24/7 through the weather, the return on investment is as paul said, when the commanders come to us and say this is how we will win in the future. we have to be careful not to say i don't know if you're going to get a six by return on investment by this. >> i'm afraid we're going to have to make that the last word. this has been an incredibly interesting and helpful panel. we do have secretary carter following this.

after i thank the panel form formally, i will ask everyone to stay where they are and not get up and get coffee. i do want to thank our panelists for taking time out of their very busy calendars today to come here and help frame up for us what we hope will be a very fruitful discussion about the third offset. please join me in a round of applause for our panel. [ applause ] tonight, hillary clinton is scheduled to make her first

public appearance since losing last week's presidential election. she's being honored by the children's defense fund and that gets under way live at 8:00 eastern on our companion network c-span 2. also tonight it's the national book awards taking place in new york city and hosted by comedian larry willmore. our cameras are there and we'll show you the event sunday at 10:00 p.m. eastern on c-span 2's book tv. c-span where history unfolds daily. in 1969, c-span was created as a public service by america's television companies and is brought to you today by your cable or satellite tv provider. members of donald trump's presidential transition team took questions at the wall street journal's annual ceo

council meeting earlier this week. this is about an hour and 40 minutes. thank you very much, ladies and gentlemen. i hope you enjoyed dinner. we're going to get straight into the real meat of the evening, and i can't imagine a better way to start than to have someone who is very familiar to all of you, someone who's played an extraordinary role in this nation's history, america's mayor as he was known, someone who has played an extremely important role in the trump campaign, so without further ad ado, let's get to it. let's welcome mayor rudolph giuliani. [ applause ]

>> so to start, mr. mayor, i can still call you mr. mayor for a few more weeks -- >> sure. forever i can still do weddings. >> in a few more weeks, we'll have to change the address to mr. giuliani or mr. secretary. >> one never knows. >> i want to comment on that and some of the interesting possibilities in the trump administration, but let me start by saying i'd like you to give us a sense of what the immediate agenda is for the trump presidency. we've seen this fascinating election campaign in which president-elect trump won in large part by expressing, by

tapping into this, very populist sentiment. you have a republican house and a republican senate. how is that going to play itself out? how is the populist moment, the populist insurgency, that that has driven president trump going to drive policies we're going to see? >> i analogize this election to the election of 1824 with andrew jackson and the revolutionary americans. all of a sudden, the american people had enough of this elite core and decided we needed

somebody who represented us and represented us meaning the people. so i think that's what happened here. i think the people revolted against what was the elite that was trying to force down on them a group of policies, a group of decisions, either they didn't agree with or wasn't doing very much to help them or didn't address what they were concerned about. and donald trump from the very beginning had an instinct and then his campaign helped with it, but a lot of it was his own instinct about what was really troubling the american people. i think that's the small revolution that's going to happen now. and now you have to institutionalize that. now you have to -- when i won electi election of amayor, i won by 3%.

he said next time we don't want to have an ulcer while waiting for the election returns. we want to win by 10%. here's how you're going to do it. here's how you're going to consolidate power. here's how you can take it through eight years instead of four. i think that's what president-elect trump has to do. he has to take his agenda and we're a three part government. the other part is congress for his purpose right now, so you have to get it through the congress. it's no good to have all these ideas if you can't get them passed. >> what are those key elements? because throughout the campaign, donald trump talked about -- he channelled this populism. he talked about -- he fought trade. he said free trade was not -- he opposed nafta. he said nafta needs to be renegotiated. he opposed ttp. he talked about limiting immigration, aggressive moves on

immigration. he channelled this pop eulism, national populism. he said imposing taxes on companies that lay off workers. this is a populist message. at the same time, he seems to stand for a pretty conventional republican position, deregulation, lower taxes, something that would actually -- that a lot of business people i think in this room would favor, but there's a tension here, isn't there, between this populism and this traditional conservative pro business strategy? how is that going to resolve itself? >> first of all, the art here -- i hate to go too much back to jackson, but jackson's election led to the beginning of the democratic party. >> sure. >> so he turned it into -- he actually turned it into a really first vital political party. now what he's got to do is

accomplish most of his agenda and turn it into something where the republican party becomes a majority party. i think we already are the majority party in this country, but the majority party at the presidential level, which we haven't been since -- really since reagan we haven't been the majority party at the presidential level, and i think it's going to mean a combination of both of those things. being practical. there are certain things he has to deliver on because he promised them sort of the way bush said read my lips. he has to deliver on -- >> which he famously didn't deliver on. >> you're right. >> that's not the best precedent. >> and that cost him the presidency. so he has to deliver on securing the borders. three years from now, we have to be a country that doesn't have wide open borders, dangerous people, criminals who are kept

here committing crimes. he's got to show tremendous progress in that area. i think he has to lower taxes. he has to lower taxes on everybody so everybody gets a little more money in their pocket so they can spend it. and he particularly has to lower the corporate tax, which i think could be one of the biggest things he could do to really ignite our economy, get it down from 35% to 15%. then i think he has to work on repatriation of money by having a low bar of 10%. you do that and within two, three years you're going to see an economy that's growing at numbers where we can sustain a lot of the other things we have to do. and i think on trade part of it could be the rhetoric of a campaign. part of it can be the misinterpretation of the media. but you're not talking about a man who is against free trade.

i think you're a man who's against unfair deals, which i think he regards as the deal with mexico, nafta, as unfair. >> do you think that would address the concerns of people in ohio, pennsylvania, and wisconsin who feel really upset and angry about what they see as the loss of jobs because of trade deals with mexico and china? >> i think the things i've outlined including readjusting nafta -- we rebuild a car in mexico. we send that car to mexico and they put an 18% tax on it. they build the car in mexico and send it back to america and we don't put anything on it. how about we kind of even it out a little bit? i think that's what he's trying to do. he's trying to make these fair deals so we can both make progress on either side of the border. if you combine that with his

general tax cut, his corporate tax cut, his repatriation tax cut, and fairer free trade de s deals, i think you're going to see a large job increase in places where he won like michigan, like ohio, like wisconsin, what we call unfortunately the rustbelt. >> the anti-wall street sentiment some of which donald trump tapped into and the pro conservative business deregulation context, that couldn't be better reflected than the announcement we had yesterday of these two first appointments for the administration. reince priebus as the chief of staff and steve bannon as chief strategist. >> yeah, i love it. >> but you know them both extremely well. >> i know them really well. >> and you know what different views they have. bannon is an aggressive populist flame thrower.

he thinks globalism is destroying national identity and he thinks what he would like to see done is an administration that takes on the globalist, corporatist, capitalist entities. reince priebus is a traditional conservative republican. who is going to win that fight? >> donald trump. i love that. that's exactly what i did when i became mayor of new york. i surrounded myself with people who disagreed with each other. i always thought it was a really bad idea to surround myself with people who completely agreed with each other because i'd never hear the other side of the argument. i think exposing him to different viewpoints is the very best thing we can do. it's exactly what obama didn't do, although he said he was going to do it because he had

read a team of rivals. he was going to put all his rivals in. all he did was put in a bunch of people who never had a job before and got no advice from business. i know some of the people on his business council who used to complain to me we only met once. we met one time and they quit. so i think instead you're going to see a president who exposes himself in the case of reince and steve. of course, they have somewhat different viewpoints, but i saw them work for three months on the campaign as complete teammates. sometimes different views, but willing to talk them out. ultimately, if they have a disagreement, you know who decides it. the president of the united states. i worked for ronald reagan and it used to be the third ranking

official in the justice department. besides a lot of cabinet meetings which there were very big debates between caspa, wi wineberger, and state. there was only one vote. it was like the cabinet of abraham lincoln. they voted unanimously against something and he voted for it. one of the cabinet members said i thought this was majority rules. he said, it is. the president rules. >> there's been a lot of concern expressed today about some of the things that he's associated with, breitbart of course the organization he runs has got a -- how do i put this? a reputation for some slightly robust -- a slightly robust approach to news in ways frankly of which a lot of people are offended. you were mayor of new york city. you had to deal with these

issues of racial tension. is the way bannon and breitbart approach it? >> i've seen a very, very smart, very bright man, very worldly man. >> i've seen a very, very smart, very bright man, very worldly man. and i also think something happens to you when the election is over. the day i woke up after being elected mayor i was like, oh, i have to do stuff now. it's not that you change your positions, but you begin to realize i've got to bring in more people. i've got to listen to more opinions. i've got to broaden my horizons. i don't think that just happens to the president. i think that happens to the chief of staff, the policy advis

adviser, the secretary of defense, secretary attorney general, secretary of state. when you're out there just criticizing, it's one thing. when you actually get on the inside, there's a certain weight of responsibility to the american people that is on your soldiers and i think steve bannon is the kind of guy who gets that. he's a patriot. he's a patriot. he loves america. he may have a different view of america than you do, but he loves america as much as you or i do. and i think he will give donald trump his best advice and ultimately it's the president who makes the decisions. >> that change you talk about, the realization that you're now the president or the mayor, have you seen that in donald trump in the last week? >> everybody has. i think the whole world has seen it. >> in what way has he changed? >> from the moment he went to see barack obama, the way in which they dealt with each other, the way in which he's conducting himself, his attempt to try as best he can to bring

america together. i think all these protests i don't think take them as seriously as some people do. i think they're going to go away. they're going to happen for a while because some people are disappointed and angry and a little bit disorganized. but i think that's going to go away. i think what we're going to find is a much more worldly and expansive president than we ever realized we were electing. >> let me quickly ask you about a couple specific corporate things. then i want to get on to some foreign policy issues, which are increasingly interesting to you. one of the things i've heard a lot -- and i spent some time

with president-elect trump and steve bannon and others. there's again this concern about big business. again, it's channelling this populist instinct about big business, big companies. this is the mother lode of big companies, mr. mayor. is there going to be an assumption that this is going to be an administration that is going to take on some of these big business issues? there's a big merger that's been announced between at&t and time warner. are these big mergers going to be opposed by the trump administration? >> well, first of all, i won't be attorney general. >> you won't be attorney general. >> i want have to decide that one. >> made that clear. >> i can escape that one. >> i should ask jeff sessions that question, should i? >> wouldn't be a bad idea, but i don't know who is going to be attorney general.

i was the third ranking official in the justice department under ronald reagan, but i ran the criminal side of the justice department. although i have litigated three or four anti-trust cases for at&t way back when there was the big, big at&t. i think you'll see pretty much a conservative approach to anti-trust law. if it's predatory pricing, where there are alternatives, you'll probably see a challenge to it. if it's a situation in which there's no alternative, but a large conglomerate, i think you'll see the justice department passing on that. i think what you'll see is pretty much the traditional republican approach to the anti-trust division like we had under reagan and bush. i don't think you're going to see --

>> that's pretty accommodating. >> the last thing in the world you're going to see is an anti-business administration. donald trump realizes that he got elected to a very large extent on something he said in so many speeches. jobs, jobs, jobs. i understood this as mayor of new york. the only way i get jobs is by having businesses. if i throw businesses out of my country, i'm not going to have jobs. so being pro business is being pro jobs, and i think one of the big changes that is going to happen immediately is instead of having in washington an administration that is anti-business, which the obama administration was aggressively anti-business, you're going to have one that is aggressively pro business. that doesn't mean there won't be a necessary level of regulation, but i'll tell you one thing that president-elect trump told me as we traveled. he said one of the things i

learned running for president, when i began, i thought the biggest concern businesses had was taxes. he said it's true they are concerned about taxes, particularly our highest tax rate in the world, 35%. ireland being only 12%. he said what i learned is what they tell me is their biggest concern is regulation. and i'm going to cut those damn regulations in half. and i bet you anything you want that within three months you're going to see that regulatory burd burden -- being a lawyer in law practice, that is not good for law firms. we love those laws and regulations because we make a lot of money on them. but that was killing job creation in america more than anything else. epa pretending it was congress. other agencies of government

legislating rules and dodd-frank. dodd-frank, excuse me, but we're now allowed to talk in politically incorrect terms, right? that's part of the revolution. we can now talk politically incorrectly. dodd-frank has nothing to do with the recession it has to do with a bunch of liberal ideas that two of the original guys, dodd and frank -- i mean, frank was the guy who was protecting fannie and freddie when clinton wanted to reform it. frank stopped bush from reforming it. i think it's the biggest irony in history that we name the legislation to solve our 07 crash over the people who

probably had the most to do with it. and everything in it is largely irrelevant to why it happened in the first place. >> we have elizabeth warren here tomorrow. >> we'd be very happy to run against her in four years. >> that's a very interesting tip there. during the campaign, president-elect trump said that he would appoint a special prosecutor to investigate and possibly prosecute hillary clinton over the e-mails and clinton foundation stuff. is he going to? >> i think that's a decision -- i've always told him this. i think that's a decision he should make when he appoints an attorney general. the attorney general should sit down and study it and give him a very reasoned balance of two things. one -- and they're both important. i don't want to minimize either one. one is the idea that we don't want to become a country where

we have political vindictiveness after an election. number two, we also don't want to be a country of unequal protection of the law. and a lot of that has to do with what i don't know, which is how bad are the things involved in the clinton foundation investigation, how beyond the pale are they. i think that's going to fall to a large extent on the attorney general. if the attorney general decides they're not that far beyond the pale, maybe we just put it behind us. if the attorney general decides they have to be investigated, then it shouldn't be donald trump's attorney general. it should be an independent counsel who investigates it, but i think that has to be a very detailed reasoned study of the fbi investigation that i believe is in the new york office of the fbi. >> okay. foreign policy. for those not familiar with it, the "wall street journal" reported earlier this afternoon that the choice for secretary of

state in a trump administration is down to rudolph giuliani and john bolton. we don't have john bolton here tonight, so i'm going to ask you a few questions -- >> john bolton would be a very good choice. >> is there anyone better? >> me, i don't know. >> let me channel what some of these confirmation hearings would be like. let's start with iran. president-elect trump said the iran deal that president obama struck was a disaster. i think he described it as the worst deal possibly he'd ever seen in his life and certainly the worst deal ever constructed on a government basis. he's going to be president on january 20th. this deal is still in place. iran still continues to do what it's doing. what would you do about that? >> first of all, the president has a lot of options because president obama didn't do what

he should have done really under the constitution. he should have submitted that to the united states senate. that's a treaty. there's no way of escaping the fact that that's a treaty. if you'd like to go to sleep early tonight, get the federalist papers and read federalist papers 75 written by hamilton who is now a broadway star. and if you want the quintessential definition of a treaty, it's the iran agreement. it binds with more than one president. it binds us for a significant number of years. it should have been submitted to the congress senate for a 2/3 vote. he never did it. what that means is that deal is over with with the present president. the next president can disavow it as a matter of law like that. >> should he? >> well, either he should or he

should use that power to renegotiate it, letting them know i don't have to live by any of this. none of this is binding on me because he never got the vote. he actually -- obama had even a second way he could have done it. he could have done it as an agreement in which case he only would have had to get a majority vote in the house and senate, but he knew he couldn't get it. >> but it was negotiated with the russians, the chinese. >> i think you have to set priorities. so if the priority let's eliminate isis, maybe you put that off a little bit and you get rid of isis first. then you go back to that because isis short term, i believe, is our greatest danger.

and not because of isis in iraq and in syria, but because isis did something al qaeda never did. isis was able to spread itself around the world, so there are 32 countries that have isis cells. the director of the fbi says there are 1,000 investigations in the u.s. so they've created a danger that al qaeda never presented to us in terms of their ability to strike smaller strikes, but still very devastating like orlando and paris and san bernardino and the priest whose head was chopped off in nice, which is one that i can't even think about. >> isis seems to be on the run in the region? mosul is under -- >> i think if you eliminate where they are, they lose a lot of power in their ability -- one

of the values -- and there were a lot of disadvantages, but one of our values in having a lot of troops in iraq and afghanistan is we kept them on the run. from september 11 until the attack at ft. hood, there was no islamic extremist domestic attack in the united states. one of the reasons for that was it's hard to plan an attack when you're being shot at and you're in a cave. computers don't work really well in a cave and al qaeda wasn't particularly good at using computers. this new group isis is different. a lot of them are recruited from us. they come from england. they come from germany. they come from france. they come from america. they understand us. they understand how to use the internet as well as our children do. and in that sense, that's got to be priority number one. we have to eliminate that threat

because we don't want to live with the threat as we have under obama of what's the next city they're going to hit. are they going to hit st. louis? are they going to hit chicago? are they going to go back to paris? i think once you get that under control you can start working on the second which may be long-term problem, which is a great fear of mine, which is an iranian shiite kingdom because now -- now, to be honest, you would have to say that iraq is a client state of iran, and we delivered it to them. could be the worst mistake in american -- yeah, probably the worst mistake in american -- >> to invade iraq was the worst decision in american history. do you agree with that? >> no, i think the way we exited iraq was the worst decision we made in american history, which

meant we turned them over to iran. in turning them over to iran, we turned syria over to iran. then we weren't there when isis began to develop. so what you have -- if you're not careful, what you have developing is i call it almost a north-south middle east. you have iran, iraq, syria with the backing of russia, yemen right below saudi arabia, so it isn't quite north-south, then you have saudi arabia, the emirates, qatar, oman, egypt, israel, jordan, sunni, the south. that's a war that's going to happen if we don't figure out how to contain iran and stop them from being nuclear. >> russia, as you just mentioned, is playing an

important role. there's been a lot of focus on russia and president-elect trump's view on russia. in your view is russia a friend or an adversary? >> both. it's both. or could be both. right now it's adversary because we made it that way. it could be both just like ch a china. what i'd like to see china is to be an economic competitor as opposed to a military competitor. russia thinks it's a military competitor. it really isn't. if you compare the size of our military and theirs, it's our unwillingness under obama to even threaten the use of our military that makes russia so powerful. >> but would that change what they've done now in crimea or what they may conceivably want to do elsewhere?

>> i believe it could contain them if we do what donald trump talked about in his military agenda, which is we take our military up to 550,000 troops. we were going down to 420,000. we take our navy up to 350 ships. we were going down to 247. now that's really critical, even for china because at 247 we can't fight a two ocean war. we gave up the pacific. at 350 china can't match us in the pacific. it becomes very different. he's going to take our marines from about 28 battalions to 36, and he's going to take our air force from about 900 fighters that need parts that we have to get from museums -- >> but what are they all going to do because he also seems to be very much against -- he was against the iraq war.

he says he's against the u.s. -- very critical of what the u.s. did in libya. what are you going to do with all this additional armed for s forces? >> he used a phrase of which he borrowed from ronald reagan, which ronald reagan probably borrowed from george washington, which is peace through strength. if you face them with a military that is modern, gigantic, overwhelming, and unbelievably good at symmetrical and asymmetrical warfare -- they may challenge it, but i doubt it. gorbachev gave the president the ability to win. he wrote, ronald reagan spent us into oblivion. >> do you think china could be somehow -- >> i will tell you what happened with china, and i believe this

completely and i've spent a little bit of time in china. i think a lot of people here know china. i think you have in china a tension not unlike -- let's cal them the hawks and the doves. the hawks are, military power can help us grow economically. the doves say, hey, we're so powerful, we're so big, we have so many poor people we have to bring out of poverty, 700 million, that let's become an economic competitor, not a military competitor. so if our navy is that much bigger than theirs, right, the doves win that war, because the hawks can't get the money they need to come and catch us. but if obama takes our navy down here, and you can kind of catch us, you kind of encourage them. now, if we take our navy up here, they're not going to be

able to catch us. and here's what i believe and know about the chinese. whatever else you think, they are enormously practical people. and they also realize they have two things to overcome that stand in the way of being a great world power. one is the enormous amount of poverty that they have. they are a first world country and a third world country combined, right? half one, half the other. >> second largest country in the world. >> that second part, someday, if it isn't already, they're going to be a big problem. second, they've developed such a large middle class. you cannot sustain the oppression, you can't sustain the authoritarianism that they have. that's going to crack at some point. the chinese are great at all sorts of plans except innovative

ones. they have thought their way through that yet. >> our participants, a couple of questions, please put your hand up if you have a question. i think we've got a microphone next to you. could you identify yourself, it's a little dark. >> yes, alexandra leventhal, mayor giuliani, i hope you recall my family, for nine decades this month, has been helping to finance our cities and states through municipal bonds. i've been ceo of my company for 15 years. i have dozens of employees in new york, in atlanta, in chicago. and i have always taken care of them. they are my family. and so many of them have expressed to me over the last week how scared they are. and there's a point at which as a ceo, i can't take care of them anymore. i can't tell them everything is going to be okay. my question to you, and i say it with great respect, is when will president-elect trump come out and denounce the very scary

things that have already happened, that have affected some of my african-american employees. i need to go back to them tomorrow and tell them that everything is going to be okay. >> what are they afraid of? >> they're afraid of having swastikas painted on the wall. i have african-american employees who are truly afraid to be african-american. they are all scared. they've seen what's gone on in the last week. and they're terrified. and i'm terrified for them, because again, i can't take care of them. i can't tell them it's going to be okay. >> okay. you can tell them they're going to be okay. >> how? >> i'll tell you why they're going to be okay. they're going to be okay because number one, they have a president of the united states that not only doesn't have a prejudiced bone in his body, and he doesn't, i know him for 28 years, but who has a real commitment to trying to help the african-american community. he didn't begin saying for four

straight months in every single speech that he gave that he is very concerned about the condition of the african-american community in our inner cities, and that he believes that they should take a look at another alternative to their success than what democrats have done for them. in every city you can mention except maybe mine that had the intervention of a republican and a somewhat republican mayor for a while, that's michael bloomberg, those cities have completely deteriorated under democrats, because the democratic policy to the african-american community is, make them dependent, make them dependent on welfare and food stamps, and don't do a damn thing for them. so what donald trump said, let me give you the ladder to success, and here is the ladder

to success in america. number one, a safe community. you can't live in a community like a lot of chicago -- >> can you answer my question? >> what? >> can you answer my question? >> i'm trying to answer your question. >> you're not answering my question. when is he going to denounce what has already happened? when is he going to do that? when? >> what -- >> when? okay. >> to be fair, do you mean -- again, to be fair -- >> do you see what has happened in this country? >> he went on "60 minutes" last night and said stop it. >> of course he did. >> didn't he? he told people to stop. >> he told people to stop doing what they're doing. he has no more control over them than president obama or hillary clinton have over the goons and thugs that are in my city that are destroying property, that

are taking over streets, and that are yelling and screaming at donald trump. so go ask president obama when is he going to tell them to stop it and when is that going to be effective. he has no more control over it than the goons and thugs in los angeles who are destroying property because donald trump was elected. so let's be fair about things. now, if there are crazy people who have come to crazy conclusions about donald trump's election, all i can do is tell them to stop it. at least he's done that. i haven't heard barack obama say cut it out, stop demonstrating, stop taking over fifth avenue on the streets, it doesn't belong to you. when i was mayor of new york, nobody, nobody took my streets. you can take my sidewalks, you can demonstrate all you want on my sidewalks, but my mayor now

allows people to block fifth avenue. that is dangerous. if you block fifth avenue, people die. you can't get them to the hospital on time to get them saved from heart attacks. you can't get to a fire on time. so if you want to say donald trump should stop the crazy people from doing the stupid things that they're doing, then you've got to say to barack obama and hillary clinton, you stop the much larger group of people who are doing crazy things in los angeles, in chicago, and in new york, that are doing serious damage. >> let's move to another question. please tell me, by the way, that the president is going to live in washington and isn't going to -- is fifth avenue going to be a traffic nightmare for the next four years? >> the president is going to live in washington. and new york hopefully will have a new mayor next year.

>> more questions, please. >> how to keep it a civil city. >> yes, here in front. >> all right. i'm nick pynchon from snap on tools. congratulations on winning the factory workers and people in shops in peoria and places like that. we like to see the experts confounded sometimes. it's the american underdog in terms of elections. but look. i think this is a reasonable question. it has to do with where he's going to live. if you watched donald trump during the campaign, at least from a distance, it looked like he was very hands-on, shaping the message himself, working on it on a regular basis. and in fact defining what his message would be. when he becomes president, it's generally been said that you have a constant barrage of questions that cannot be decided on the facts.

do you believe he's going to handle that the same way he did his campaign, in other words immerse himself in it or delegate? that's one question. can he actually immerse himself as other presidents have? and secondly, when he confronts those questions that can't be decided on the facts that you just can't look at the arithmetic associated with it, what will be his guiding stars? will it be jobs or -- >> very good question. first of all, you probably discount somewhat, because you don't know him and maybe a bit of this is his style, just how reflective and how much he can delve into issues and things. the things he talked about are things he thought a lot about. they're not just things that -- he spent a great deal of time thinking about the policies that he thought were necessary for the american people. that's the reason he won. not to relitigate the election,

but hillary clinton gave very little attention to the policies she would put into effect when she was president. he gave a great deal of attention to the policies he would put into effect when he became president. he talked about immigration. he talked about taxes. he talked about about trade. he talked about foreign relations, the iranian agreement. she didn't talk about any of that. so i think you're giving him a little less credit for the amount of thought that went into what he was saying and what he was doing. i've seen him in many meetings with four, five, six, seven, eight people, whether away talking about foreign policy, military policy, or domestic policy, absorb what people were saying. i told you about his change of opinion on what was more important to american business, taxes or regulation. and he came to the conclusion that regulation was more