politician who would go in the right direction, probably [unintelligible] , who is living in her house under threat of murder every time she goes out her front door. your question -- what i worry about worst is a coup from within the military in which there is a reincarnation of the pakistani general who was a committed jihadist. in 1980, such a man came to power. we were fortunately able to point him in the to point him in the direction of atheistic communism. we have the highlights of this. the problem is that the soviet union is not around anymore. is it possible? i think i have given me the name

of a corps commander who i think is very realistic. he smells like a committed jihadist to me. he is just been promoted again. are there others like him? one of the is the be the next leaders. >> what advice would you give? >> i think of this point, it is

not simply a wide range for violent extremist movements. it does manufacture missiles. they are doing it in a climate where you are holding up on both sides. it is a little unique. they have to lie about it.

they are our main nuclear weapons that are not adequately tested are characterized. they are our main them on missiles. they are a long way away. new have interests that go beyond the whole picture of any kind of nuclear confrontation. this is a very dangerous issue. >> should we worry about china and pakistan? he mentioned that we might threaten them and citing more with india. -- and citing war with india.

is this a credible threat? >> it is a threat we make. we made a remarkable scene recently with the minister of defense -- most of you do not know who he is because pakistan is being the minister of defense and the government is being the least important job -- he came back and said we will give china a naval base. there is an embarrassed silence. we really do not want a naval base. it may be a lot. i am not a china expert. i cannot tell you the chinese part of this. from the chinese point of this, and they see -- and the pakistani point, they see china as their all their friends --

they are all whether -- theor friends.ather i think they are more complicated allied then they want us to believe. i would also have this. they are moving them closer to the pakistanis as a source of reliable military manpower. pakistan has alternatives to us. it likes to exaggerate the size of these alternatives, but they do have them. >> there is another side of

this. that is simply trade logistics. there has been a lot of talk. pakistan is not a particularly attractive structure for china. it is not a particularly good group for pipelines and roads unless you believe it is completely secure and you have real reason to move from the indian ocean north. when you look at what china is doing, is not financing a major road through pakistan but one through to run -- tehran. that is a massive investment for china. the other is for obvious economic reasons you have funding for east/west communication lines.

you have a rather peculiar subculture of people who are fascinated by afghanistan and pakistan. on the other hand, you have it on the map. they are moving east, west, in north. >> you mentioned the arab spring. is a possible to see this popular uprising? is it possible to see it in pakistan? you have a lawyer movement. it fizzled out. could there be a demonstration? >> if there is a lesson, it is do not rule out possibilities in the future for the risk of looking foolish very quickly after the roll them i'll.

i will not rule anything out. -- after you rule them out. i will not draw out anything. you had a citizen during that asked for the rule of law. the ast for accountability. they wanted the system to be reformed. they succeeded. maybe it would have turned up a whole lot of adulbetter if theye not been murdered. the problems are much more in depth than that. this is their fourth time that the deal with the democratic system. i give them a lot of credit for

persistence, for inspiring to be a modern democratic state. if you have to believe in the triumph of hope over experience to believe it will succeed. it will not be there as long as the dominant political player, the army, it is so relentlessly focused on competition with india that it demands an exorbitant part of the national budget for its command and demands total control over national security or be held solely in the hands of the army. it is an army and church and the state in many ways of today. that is a political problem not

easily resolved through the kind of political demonstrations of people that we have. they are more likely to go back to military dictatorship. afraid of theen words "air of the spring -- arab springs." recently a heard one described it as what you do not in the west understand is that it is intensely hot and filled with sand stunt. it is more realistic than some of the descriptions we have held elsewhere. we have much more an option as you did in egypt between a militaryletelite and the

structure. the whole group of separatists has different movements. they do not have reasons to produce some type of unified process of change. you may see a power struggle. that is not the same thing even as the egyptian case was. in general, we need to remember that the only thing that we do have been competition is that none of them are like -- in common is that none of them are alike. >> the military as parts of the problem. should we think about putting greater conditions on the military aid?

they are under greater pressure. ? >> it gives people the freedom. let's be real. we want is to maintain the lines of communication with out more trouble and not have more problems and occasionally have them do something useful. we are pushing them hard enough. it is not a good idea to discover that we suddenly need one. today's contact that is going out in washington. with this shift the center of gravity? how do you do this? >> traditionally, pakistan's strong this promoter inside the

united states government has been the cia. they argue that the relationship with the isi produced results. that was the argument back in and through most of the first half of this decade. the formula there would repeat is that the isi's most important ally in the world is outcry debt as well as the most difficult ally in the world -- is al qaeda as well as the most difficult ally in the world. this change. this has changed in the last the

year. it has certainly changed with the raymond davis of fair. my former colleagues are spending even more time than i am answering my questions. they need more up close and personal questions. if that advocates changes as it has, this is arguing the case that we need them for the supply line. i have a drink last night. he is an ok guy. the departure that he will bring

with them is also bad news. the principal defender has the engagement with pakistan. they argue in favor of the engagement with everybody. that is what they are supposed to do. the track record iis pretty sli. they have nothing inside of it. my reading is that not only does it prevent this on the ground and it will get worse. all this said, at the highest

level of this administration, they never had delusions' of pakistan. they understand it is a proper place. they are getting in place with it. in gear is not a solution. solutions are not very good. nger is not a solution. solutions are not very good. >> is there any strategic plan that could work in pakistan? >> i do not think it is hopeless. one of our great problems is the idea that somehow, you find the message and to keep repeating it.

if there is any place that has worked since the start of the second pushed administration, i would love to do it. if you really want to communicate to people, you have to communicate with them. you have people in the military who are very real. what you do not have is a matching set the media. the extent of the media. the other problem is is that it address aan common the cannot be realistic about us. it did not matter that much if

they wear angry at the united states. what does matter is the inability to focus on water and infrastructure. what people actually need and the threat that is posed by religion and extremist group. it is not directed toward us or anyone on the outside. it is caused by problems on the inside. >> you have been very patient. we have about 25 minutes for questions. please state your name and affiliation. go ahead. >> a simple question.

there will be a deal cut with government and the caliban. -- and the taliban. has that changed the equation? >> when you cut this kind of deal, are you cutting its air around us or with us? -- with its own around us are with us? today except a political role or is this simply a cosmetic device for them to try to manipulate the situation. omar? om it is always possible in politics. the idea is not something that

strikes me as immediately possible. he had the problem of how it fits into this structure. the other thing to remember it is we are still fighting a tactical war to try to transform afghanistan into a state with a more effective government and popular support. the caliban -- taliban is fighting a war of political attrition. they will do what they need to win if the afghan government remains weak and something they can exploit. the problem with most of these deals is until they can be firmly convinced that they can be moved, they can be an

extension of an insurgency. it is compound it by the fact that there are a number of countries that want out under any form possible. the pressure is not simply pressure that affects the key negotiating parties. it is pressure within nato. this the better part of ours. >> i just want to add one thing. i agree with all of that.

i am in favor of the political process behind deeply skeptical. i am deeply skeptical that it could produce the outcomes you want. there is the fear that the political process will lead to the collapse of the northern alliance. they say we are not interested in the political process the people we regard as our mortal enemy. i want to put an inconvenient fact there. there is a great hope that certain circles here that the taliban can be split. these and not necessarily bound together.

they will put out a eulogy and bemoan what has come to the islamic world. as a defender of afghanistan, everything he would not want ay he can dismissed as propaganda. they find a lot more communication before osama bin laden and caliban.

taliban commanders. >> i get a lot of weird e-mails. >> i share your frustration. we could drive it into the orbit, they can continue proliferating its parent i wonder if a marriage of convenience is a possibility.

>> i do not think there advocating divorce. we are not in the business of saying let's answer a relationship. it is realistic. we are always small and looks smaller it than they did two years ago. i think we have to deal with this reality. there are all kinds of negatives. there were a true believer of long as they took control, the

fifth largest country in terms of population parent what america strategy would you deal with? they are not likely interested in gauging us. are we going to contain them? containment is always this. should we invade pakistan? i know your reaction is that he is not. mr. elevated their airspace.

there are 180 million people. they are not ready to be won over by the american way of life. it can get much worse. we are not advocating that. we are not in favor of it. it is getting worse. >> i'm going to have to try to get away from it. where is he when we really need it? sometimes these fantasies will bomb them out of nuclear weapons.

or we will send and special forces. we also have to recognize when we talk about transitioning out , there is the question when we leave to put the structure together for a while. it sustained this through 2020 and beyond. that is the plan if you want to hold together. do we maintain the capability? what do we have to pay them?

what do have to give them? we have $107 billion. if this $7 billion worth of additional money she did with a metal costs -- to deal with the medical cost of the war. are we ever going to sustain even a fraction of that? what is our idea in this region? what is our policy?

we have an interest in latin america. we have to be much more careful about how we allocate it than we have in the past. these are all very hard choices. what they all warn you of is focusing only on the present as one country of particular interest. we spent the last decade without a strategy toward anybody. with cannot afford to have a pakistan-centric static dream -- strategy.

>> what makes you think that pakistan can become a jihadists country if they do not trust the united states but they are being killed by a the jihadists? when we talk about political negotiations, where are we in regard to the belief that one day the u.s. will leave pakistan to deal with the situation? how do we look at the relationship and their wish to have a major role the it is in

bed with part of this. the complexity, the contradictions, and it is these complexities that make it such an important problem to deal with. isn't it eminent? is it inevitable? no. is a possible? certainly. outcome? most likely i do not think so. usually your nightmares are not the most likely thing that happened to you the next day.

you ought to pay attention. it is in a future process. countries do not have a right to be involved with the political process of their neighbors with out this. the problem for them is said they proceed to have invited themselves and. if you think my delfts in the dealings with afghanistan are extreme, you should talk to the former head of the afghan intelligence. he is a very interesting case.

osama bin laden is not hiding in a cave. he is hiding in the heartland of pakistan. it is probably protected by the isi. he was right. if i may turn their. -- there. >> karzai has either change the constitution are he is done. no one has it under karzai as a strong and confident leader. many of us have met it. they have good reasons to be extremely cautious about what comes next. you now considers the

statements? how separate visit from the northern pressure? how does it work again? is it still real? how much is the central government involves in it? it is just in the areas where they can now provide the security. what is the status of the northern thing in afghanistan? having had two failed elections, won for parliament's

in having created the legislative body that has no clear function, even if it is properly elected, what actually evolves? we cannot answer a simple one of those questions. it is more than anyone should have articulated in afghanistan or the administration. i would suggest that we need to look beyond this as quickly as possible. it is something people forget again and again. for us to act we need money. we are already drafting the

budget. this will fund the transition here. if we do this as we now are, of we present a lot of problems that we could potentially avoid. this is the kind of reality we face. >> said the girl had time for one or two more. -- i feel we have time for one or two more. >> i hope the afghan children. we have been working in afghanistan and pakistan. my question is that how often

afghans are actually engaged or involved in the decisions that are made for afghans in afghanistan? at least their opinions are considered. >> i think the answer is which. yet had to elections. we certainly notice on the outside. you do have a government that is being steadily strengthens. it vastly exceeds the capacity of them to spend it much less spend it wisely. they cannot execute the budget.

when you talk about civil society, we have moved money. they read this as district governors. they try to empower it through the process. i am not sure it is in the afghan process queue has asserted it so much. you look at what is actually happened, people say we should control the money. then you look at what happens when you give it. frankly, we have already

exceeded this to deal with it. you are not going to put this in there. you are reforming the contract in process. the whole idea is to get away from the process that has major subcontractors. this would solve some of the other issues.

you have responded. and there is security. they also wanted to have government services and corruption. this is very much a matter for afghans to solve. it can sometimes help but it does start reform society. it is not imminent anywhere i know of. we can help people help themselves.

>> the final question? please join me in thanking them. 3d him. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> up next, a discussion on the u.s. manufacturing sector. it is followed by the announcement of a new white house initiative. later, president obama's defense. our road to the white house covers covers this sunday. they talk about the federal deficit and abortion. what road to the white house sunday at 9:30 p.m. eastern. >> this weekend on american history television, more than 20 years after the cold war, a panel reflex on ronald reagan.

restoring civil war. to get the complete weekend schedule. press feeler button to gets this. >> the nomination is confirmed. >> the senate confirmed the deputy counsel to exceed justice elena kagan as general. they are discussing its in 1994. he is one of the 100,000 people you can search and watch for free in a time online at our c- span video library.

>> from "washington journal" this is almost 30 minutes. host: jay timmons, president and ceo of the national association of manufacturers. thanks for being here. first questn, what is the condition of manufacturing and america? est: manufacturing has had a bit of a rebound in the course of the past few months. we have added about a quarter of a million new jobs, and that is good news but you have to take that into context because we lost 2.2 million jobs in the recession. there is still a long way to go. our concern is perhaps some policies in washington are making it more difficult to see the reissance we think it is ready to bloom. host: a couple of policies that in place that are not working or new ones you would like to see in place? guest: is 18% more expensive to manufacture in the united

states than anywhere else in the world. the three most relative factors our tax policies, energy pocies, and our regulatory burden. host: the pne numbers are on the bottom of the screen for our guests, jay timmons. we will take calls from republicans, democrats, and independents. i wanted to talk about the presidential event yesterday. here is of the washington times -- he said -- >> last year, we brought

together the major companies and community lleges to launch a new campaign led by business leaders from across the country called "skills for america." we could match up schools and businesses, which could create pipelines are right from the classroom to the office or the faculty flo. this would help workers find better jobs and would help companies find the highly educated and trained people that they need in order to prosper and to remainompetitive. today's , we are announcing several new commitments by the private ctor, colleges and the national association of manufacturers, to help make these partnerships a reality. through these efforts, we are going to make it possible for 500,000 community college students to get industry accepted credentials for

manufacturing jobs that companies across america are looking to fill. because even though a lot of folks are looking for work, there are a lot of companies that are looking for skilled workers. there is a mismatch. we can close it. host: tell us more about this idea that he speaks of. guest: one of the issues -- i mention problems that manufacturers face. another problem that manufacturers have, ironically, we still have a number of manufacturers that cannot find the skilled workers that they need to fill vacancies that they may have in their facility. our goal is to credential 500,000 potential manufacturing workers in the next five years so they are prepared and have the skillsecessary to be able to start a job in a facility right away.

right now, there is a pretty big pool. there is a some retraining going on and some new entrants into the workforce of those looking for skills. we are workingargely with community colleges across the country to develop these programs that will help train and provide the technical skills that are necessary. host: the first call for our guest, cleveland, an independent. good morning. host: start over again if you could. caller: high and may stay at home mom who stumbled on an idea for a product. when we got to the manufacturing point of the product, i checked here at home in the u.s. and to manufacture, it cost three times more for me to go to a plastics manufacturer here than in china,

and the price per piece was passed in china than it was here. how are accidental entrepreneurs supposed to manufacture products in the united states? guest: that is a great question. i am glad to have and my first question comes from my home state of ohio. the issues i talked about earlier are exactly the problem that you face and many manufacturers and face when they are making decisions on where to do busess in the world. we are a global economy. manufacturers that are making decisions about where to produce products have to decide where the best or the most efficient cost of doing business exists. there are three issues that i mentioned before that are so critical to determining the cost of doing business. first, our tax policies. we have the highest corporate tax rate in the world right now.

it is really startling when you think about how 20 or 30 years ago we were constantly evaluating where we stood in the world in regard to our corporate tax rate to decide how mpetitive we could be. on energy policy, we are not developing our own natural resources. we are highly dependent on unstable sources of energy around the world. the cost we face are largely because we are not taking advantage of our own resources. the regulatory burden -- some regulations are good. most, if not all, are well intentioned. it is how they are executed that drive up the cost of doing business. we want to bring down that 18% cost differential of doing business here in the united states. host: what actions have you encouraged? guest: with this current congress, the new regulations or

new cost pressures. we have been working with congress and we have a lot of folks on both sides of the aisle as well as the president who has been talking about reducing the corporate tax rate. this is probably going to happen in the context of more comprehensive tax reform overall that will include more tha just the corporate tax rate. also talked with members of congress about a comprehensive energy strategy, and we have seen some members ierested in opening up new areas for exploration and development. the administration has at least givean indication that they would like to see that as well, although the permitting process has slowed down our ability to do that. on the regulatory front, have stopped some bad things in congress from happening. a few years ago, legislation

would have created a regime to cap caon and put a price on carbon, and we did in independent analysis to show that that would cost 300 million jobs in the long term. now the question is how do we roll back some of those things that have been so harmful? we are pleased the administration has asked agencies to evaluate all regulations to see what their cost benefits are for the american economy. unfortunately, that executive order does not extend to independent agencies like the epa or some of the most egregious and most costly regulations are being promulgated. host: a quick thumbnail sketch on nam. the largest industrial trade association. it represents manufacturing in

every industrial sector in 50 states. at 11,000 manufactung companies across the country are represented. that is almost 12 million workers. how has that number changed? guest: it is dropped off 2.2 million. we have regained about a quarter of a million of those that were lost during the recession. there is still a lot of capacity outhere. host: can you get that back up to 12 million? guest: we would love to go beyond 12 million. so many opportunities in this country have been lost because of policies here in washington. we want to be able to print as opportunities back to the united states. we have a manufacturing strategy we have outlined, and we have three major goals. we think the u.s. has to be the best country in the world in order to had quarter a business

or attract investment. we believe the united states has to be the best country in the world to innovate. third, we think the united states has to be the best country in the world to manufacture anin. also, to serve as an export platform for the rest of the world. 95% of potential custome reside outside of the united states. host: back to calls. pennsylvania, ralph, good morning. caller: good morning, sir. how are you? why is it ok for companies to be so unionized and yet so against the workers to be unionized? guest: i think one of the great freedoms that we have in this

country is the ability to form a union. the relationship between a company and its workers is really unique to each company. some companies or some work forces decide they do not want to unionize because they prefer the relationship that theyave with the management of the company. some decided that they want to unionize. some states have the right to allow individuals t decide not to join that union. those are all individual to states and companies. how do we ensure that the workers of this country are protected ainst policies that harm our ability to compete in the world and our ability as manufacturers to insure that we can keep our work force here and

keep them employed and make sure they have the right benefits. i'd go right back to the policies that we talked about, making sure washington has a reasonable tax bden, making sure washington has a reasonable regulatory burden and allows us to take advantage of our domestic energy resources to drug and the cost of energy in this country so we can invt here, notnly in expanding facilities in this country, but insuring that workers continue to enjoy the best quality of life. host: the republican line from los angeles. caer: biance had one of the -- host: independent caller, curtis. caller: i do not know if i can top that last caller about beyonce. go buckeyes.

one of the things that has always bothered me is we have a huge manufacturing base from the 1950's to the 1980's, and it contind on. can we ever get back to that level where we can get back to the big manufacturing base? i have always thought this. if we start producing our own oil and energy, wouldn't that cause a world crisis on the market for oil and energy because we will not be buying as much on the world markets? i will hang up and listen to your answer. guest: thank you, curtis. i think most people uld be surprised and i am always surprised about how many people say to me do we really manufacture anything in this country anymore. manufacturing, if it was its own country, would be one of the top 10 countries in the world

economically. our manufacturing base is strong and robust, but at the same time most people understand and policy makers understand, because everybo is talking about the importae of manufacturing, most understand that manufacturing is key to a strong economy and economic growth. we want to see the manufacturing sector grow and be even stronger in this country. one of those costs i have mentioned is affordable energy in this country. if we were developing oil and natural gas resources in this country, the effect it would have on the world economy would be quite positive. as we are a large consumer of energy in this country and manufacturers' consumer the percentage of output in our country, other countries around

the world are growing. their appetite for energy is growing along with that. the more that countries like china develop economically, the more energy they are going to consume and the less resources and there are for the rest of the world. that is why energy prices are that is why energy prices are going up and that is why we need to develop more natural resources. we have got to not only take advantage of our own will and natural gas resources, but we have to develop nuclear and alternatives, and make sure we are investing in clean coal technology because we have an abundance of technology in this country. we need to take advantage of that so we are growing our own economy. host: the financial times tells us that china has become the leading user of energy now in the world.

host: exxon on fling -- unveiling big finds in the gulf. they were previously looking for more exotic locations. the springfield, va., elise, good morni. caller: i want to thank you for allowing me to have the chance to speak to you. want to make a couple of statements and then i have a question for you. i listen to what you said about the global economy and also the excessive tax burden that this country has for manufacturers. after watching "60 minutes" expos day on corporate taxation and

having essentially paying no taxes, and then there are states that have invited foreign corporations to build cars there where the communities have actually pai for really write- off, so we are essentially giving them a negative net tax burden -- i just find that when i hear that and i know there are so many things written off and so many loopholes, and we keep hearing this mantra about excessive taxation. what i want to say to you is before the philosophy of the global economy became the predominant belief in the world, the united states is manufactured a great many products, so many of which were of high quality. for those of us who do not shop in wal-mart, who shop in other

stores, we are seeing nothing but chinese-made goods that are completelynferior and not cheap at all. materials that lose their colors after being washed. things that fall apart as if theyere from a dollar store. yet we have manufacturers flocking to these countries who claim they are giving us this great bargain. it is not a great bargain. as an organization, you are not really giving us a great product. americans have done things better, and the quality has always been so far superior, and yet the only benefit is the manufacturers are making a windfall in profits. as far as i am concerned, your

organization is nothing but another union. host: jay timmons. guest: thank you for that comment. everywhere i go, everybody says that the made in america label is really a show of pride. everywhere around the world. everybody wants something made from america, including americans. our challenge is to bring manufacturing back or to retain the manufacturing we have in this country and to bring it back in this country where it makes sense. sometimes, it does not make sense to manufacture a large equipment product in this country if it is going to be shipped to india or another developing country because of the transportation costs. one of the ways that we bring manufacturing back and to make sure the manufacturing that is here stays here is to ensure that we are able to compete with

the rest of the world. a couple of points that you made. one is the statutory tax burden. i can tell you that many companies paid nearly that amount. it causes them a very difficult -- it is a very difficult impediment for them to be able to compete with other manufacturers around the world. the companies that have lower tax burdens or simply paying the tax rates that are available to them via the tax rate today, and manufacturers in total would like to see the lowering of the tax burden by getting rid of some of the preferences that ist out there. the lower the statutory tax rate in the effective tax rate, the more competitive they will be in this country and the more able they will be able to hire workers. at the second int he made i at the second int he made i think is a very good one. i used to work for aovernor in

virginia. every state has the ability to create incentives and attract businesses to their state. businesses to their state. jobs are a good thing. they are good for the community and good for our tax base. they are good for local schools, local firefighters, and all the other amenities and services that we expect. the united states does not have the ability to have that same competitive edge. we cannot provide incentives to say we are going to eliminate the corporate tax rate. other countries have that ability. we all lose business to companies like, say, singapore or thailand when they can compete and say we are going to eliminate your corporate tax rate for 10 years, we are going

to give you incentives to locate a facility at this particular location. i am not saying we want to do that at the federal level. host: we have time for a couple of more calls. in manufacturing summit will be here next week. guest: thank you for mentioning that. host: what will be the purpose? guest: of the goals are for our manufacturers to have mtings with our members of congress, real people in the real world struggling to keep a business and employees employed in the companies. we will be talking about those three issues. fair tax rates for this country for corporations, energy supply, and our regulatory burden and the fact that it is 18% more expensive to do business in this country.

host: in november, you are going to host a presidential candidates in iowa. guest: our chairman is the ceo of a manufacturing company in iowa. iowa is a rather busy area when it comes to presidential campaigns. on november 1, all presidential candidates are invited. host: one last call, brian from north carolina. hey there. caller kudos to the previous caller by the way. quick question. the govement knows of this tax burden that is so vicious to gain in manufacturing jobs -- what is taking so long to bring it down to par? the second one is more of a statement of what obama had to

say. he wants to educate 500,000 people for theork force. you are asking a bunch of people to go to schools to takelasses for a job that might not even come. thank you so much. guest: thank you, brian. we do have a shortage of skilled workers in manufacturing. that is the strange paradox right now. there are facilities across the country that cannot find the workers that they need to possess the technical skills necessary for the jobs th they have open. this will help people transition very quickly into jobs available around the country. the more people that are trained, obviously, the more competitivthey will be in the job market. it to your first point, on the tax burden and why it is taking so long, i cannot answer that but to say that washington is kind of a broken right now.

republicans and democrats cannot seem to work together in a bipartisan way to tackle the major problems that this country faces. i do not think there is one person or one appointee in the obama administration who would not say th're creating more jobs in this country is our number one priory. getting agreement on how to do that has been extremely difficult even though most folks say our corporate tax burden should not be the highest in the world. we are very hopeful that congress will get serious about the corporate tax burden and do some things that they're going to h help us compe defense

secretary. [captioning performed by national captioning institute]

[captions copyright national cable tellite corp. 2011] >> good morning, everybody. -- overmittee meets to so the course of this long and distinguished career in public- service, we welcome you to the committee today and we thank you, mr. panetta for your decades of dedicated service to our nation and your willingness to enter the call once again. we know your wife is not able to be here with you today. she has made her own sacrifices over the last 50 years, supported your efforts in the public and private sectors. i know that i speak for the committee when i say that we love to think her in person for the sacrifices that she has made. please let your wife know of the

committees gratitude for her support and your sacrifice. if confirmed, director panetta will replace secretary robert gates at the helm of the department of defense. he was asked to stay on. it provided a welcome continuity in our defense leadership. director panetta's nomination represent change and brings an impressive level of continuity as well. the next secretary of defense will face a complex set of demands on our armed forces. for most of the ongoing war in afghanistan andraq. we continue to have proximately 150,000 troops deployed. in addition, even after the

extraordinary raid that killed osama bin laden, terrorist threats against our homeland did seem to emanate from pakistan, yemen, somalia, and elsewhere. the risk of a terrorist organization getting theirands on and detonating an improvised nuclear device or other weapon of mass destruction remains one of the grast threats to the united states. the defense department is working with the departments of state, energy, of insecurity, and other u.s. government agencies to prevent the proliferation of nuclear weapons and dangerous technologies. a number o key national security decision will have to be made in the coming weeks and months, even as the drama of some kind ofaq -- continuing u.s. military presence beyond the december 31

which role does not agree to by president bush and prime minister maliki in the security agreement between our countries. another key decision point is looming in afghanistan. regarding reductions in u.s forces starting in july. president obama said the other day that, "it is now time to recognize that we have accomplished a big chunk of our mission and that it is time for afghans to take more responsibility." the president has also said that th reductions starting in july to will besignificant -- will be "signicant and i just a token gesture -- and not just a token gesture." to assume security responsible

for all of afghanistan. i support the so-called transition strategy, which calls r afghan security forces to take more and more of the lead in providing for their countries security. the mor that afghan security forces do that, the better the chances of success, because the taliban's biggest nightmare is a large effective afghan army, an enormous party perspective of the afghan people and control of afghanian security. having security forces in the lead would deprive the taliban of the biggest propaganda target, the claim that foreign troops are occupiers of afghanistan. there is nothing inconsistent between transitioni secury responsibility to afghan security forces and long term

strategic relationship with afghanistan, which is also important to sustain a successful outcome. another major issue facing the department is the stress on our armed rces after 10 years of nonstop war. the repeated applause ofour military has resulted in many of our service men and women being away from their families and homes for two, three, or four torours. military families are also stress. our men and women in uniform can t to answer the call. the next secretary of defense will be required to juggle the competing demands on our forces while washington struggles with an extremely challenging physical environment. the defense budget will not and should not be exempt fm cuts.

this will require congress working with the next secretary of defse to scrub every program and expenditure in the defense budget and to make tough choices and trade-offs between the requirements of art were fighters today in preparation for the threats of tomorrow. the administration i february submitted a defense budget for fiscal year 2012 which included some efficiency savings. in april, president obama announced he wanted to reduce secuty spending by foreign billion dollars over 12 years -- by $400 billion over the next 12 years. including the departments of state and homeland security. we have asked the a ministration what parts of the $400 billion reduction to the recommend the

pentagon cuts and how many of those for fy 2012? so far we've done no answer. hopefully say we'll get mr. panetta's understanding on that matter. his service is invaluable because he understands the into workings of the budget process and because he shaped the decision that helped achieve the budget surpluses of the late 1990's. fort lee, director panetta brings a compelling record of achievement and experience as well suited to the demands of the position for which he has been nominated. leon panetta has repeatedly demonstrated an ability to work across party lines. since entering public service, he worked on the staff for the republican whip in the u.s. senate, headed the office of

civil rights in the nixon administration. he served eight terms and became chairman of the house budget committee. leon panetta has been indicted by a clear compass. he has said, "in politics, there has to be a line beyond which you do not go. too often people don't know where the line is. my family, how was arrays, my education all reinforce my being able to see that line." leon panetta has been involved in the most pressing national security issues of our time during his tenure as president obama's director of the cia. this includes overseeing the manhunt for osama bin laden and the impressive operation that

brought an end to al qaeda's murderous leader. this operation epitomizes the way in which the cia and the defense department are finally working together to support each other in the counterteorism operations. the assault on bin laden's hideout is the first significant instance, i believe, of an operation that could have been conducted under defense department authorities, but that was instead executed under the authorities of title 50, with the director of the cia exercising operational control over our elite militar force. then the conclude by expressing on behalf of this committeeur gratitude and are a deep admiration for the man whose shoes director panetta's has been nominated to fill, secretary robert gates. service to thes'

country has been extraordinary. he worked under the administration of eight presidents. he filed a long career in government and served his country again in the critical post of president bush's secretary of defense a difficult time in our history. to route his tenure, -- throughout his tenure, his leadership and kantor have earned him the trust and respect of all who have worked with them. secretary gates has combine business with the toughest and cleric and courageous, a firm decision making. secretary gates is devils a direct and open relationship with congress -- secretary gates developed a direct and open relationship with congress.

his time has been exceptional. senator mccain. >> let me welcome director panetta. i am grateful for its remarkable career of public svice and is a lotus to serve in this n and important capacity. i am appreciative of your family and the support they have given to you. i also welcome my colleague from california who was wrote underscore your important qualifications to assume the position of secretary of defense. your successor as director of the cia over the past two years, and have been many, or credit to you at the men and women of the intelligence committee. you and i know the director would be the first to limit that he has big shoes to fill if confirmed in a person of robert gates. i have seen many secretaries of defense and i believe history

will long remember secretary gates as one of america's finest, most effective and most impact all secretaries of defense. one of the key criteria that we should be looking for in the next secretary of defense is continuity. the county was of the wise decision making that characterized secretary gates' leadership at the department of defense. things to is -- thanks to the good work of this team, the next secretary of defense will take all this with a good deal of positive momentum. many challenges remain. our countries faces decisions that will echo for decades to come, this is a double determine whether it would remain the world's leading global military power able to meet our many commitments worldwide, or what we will begin abandoning that role. will have perhs the most

impact on this outcome is the stated goal of cutting $400 billion in defense spending on top of the $178 billion in reductions that secretary gates already announced. this cuts into the muscle of our military capabilities. defense spending is not what is sinking this country into a fiscal crisis. if the congress and president akbar that flawed assumption, they will create a situation that is truly an affordable, the decline of the u.s. military power. i know there will be cuts to defense spending and some reductions are no doubt necessary to improve the efficiency of the department of defense. but also remembe -- more rubber

when the former chief of staff of the army warned in 1980 aer cuts were made and testify before this committee that we have had a hollow army. that is not an experience that we should repeat in the years to come. we must learn the lessons of history. how the proposal could be implemented. another major decision involving how we achieve our objectives in the three conflicts in which u.s. forces are now engaged -- iraq, afghanistan, libya. in iraq, the key question is whether forces will remain in iraq beyond the end of this year to support their continued need in our in our national interests. i believe such a presence is necessary, as secretary gates has argued.

in afghanistan, the main question is the size and scope of the drawdown. i would agree with secretary gates that any drawdown should be modest celesta maximize our ability to lock in the gains of our troops during the next fighting season. in libya, there are signs that muammar gaddafi may be starting to crack. the odds of a stop remained far too high. i believe u.s. treasury to be to reduce those odds as much as possible and quickly force muammar gaddafi to leave power. another significant challenge department defense pa -- secretary gates has made some courageous decisions to get major weapons to kermit project's contractor is similar focus is brought to of the

defense department chooses to buy billions of doars in services to maintain the highest degree of readiness. as best in this budget a farmer, it will be important to continue to limit weapons programs that are over cost, behind schedule, and not providing improvements in combat power and capability. we must continue to eliminate every dollar and wasteful spending that siphons reserves away from our most vital need, enabling our trooped to succeed in combat. director panetta, you are nominated to lead our armed forces. this has placed a major strain on our armed forces and our families. our military is performing better today tn at anytime in our history. this is things to the thousands of brave young americans in uniform who are writing a new chapter in history of our great country. they have shown themselves to

be the equals of the greatest generations before them. a: all + + enter is to be equal and for ever faithful to the sacrifices of these amazing americans. we have a quick 10 second comment. >> thank you. i have an unavoidable conflict. i have served with mr. panetta and i consider him to be a close friend. but for to support his confirmation and serve it with him in is the capacitor think you for the opportunity. >> thank you, senator mccain. our two colleaes from california are here to introduce mr. panetta. it is a treat the you're with us. senator feinstein, the chair of

the intelligence committee. she has a lot of direct experience long before then with director panetta. >> thank you, mr. chairman and members of the committee. it is distinct pleasure for me to introduce the director of the central intelligence agency and distinguish california, leon panetta, who was nomined by president obama on april 28 to be the 23rd secretary of defense. as members of this committee will know, it is 47 years of public service, director panetta ha held positions of congressman, chairman of the house budget comttee, director of the office of management and budget, chief of staff to the white house, co-director with his wife of th leon and sylvia panetta institute for public policy, which i've had the pleasure of speaking before, a member of the iraq study group,

a secondof the caia, and first lt. as an intelligence officer. trusted adviser to the president and respected member of his national security team. in the course of two years, he has mastered the intelligence field, led the cia three very tumultuous time, restored badly maged relationships with congress, and wit the director of national intelligence, and carry out president obama's personal instruction to him to find osama bin laden. i have no doubt that his past experience and is capabilities prepared leon panetta to meet the major challenges before the department of defense. with knowledge of cia operations and analysis, he will come to

the pentagon with a thorough understanding of the situation in afghanistan as well as the aggravating factors of our relationship with pakistan. through cia analysis, he has also well aware of the other contingencies around the globe, where the united states military may be called to deploy. director panetta is also well positioned t guide the department to the cstrained budget environment which the chairman spoke of along with the rest of government. he possesses the credentials and experience to make cuts are needed and were prudent. i am confident that he will do so in a way that keeps the military strong and capable, and in a way that maintains the cohesion of the department's and its services. finally, let me recognize the

there many officials in government with the intellect and management skills to do this job. leon brings something more. he has an interesting leadership style, with a deft personal touch that matters to the people in his charge and that really benefits the oversht responsibilities that we in congress have. then give you an example. it was early in his tenure at the cia in 2009 when director panetta requested an urgent meeting with the intelligence committee to brief us on a program he had just learned of and that he had learned had never before been briefed to congress. he found that unacceptable and we very much appreciated his position. in the two years since, he has never declined to answer a question or provided with this -- or provide us with this candid views.

i believe center chambliss can testify to this -- i believe senator chambliss can testify to this. let me conclude -- a national public group into the last week with secretary gates noted that the health care budget of the department of defense was bigger than the entire budget of the cia and that no other position could fully prepare someone to be secretary of defense. i have great respect for secretary gates and praise him for a service to this country beyond all reasonable expectations. he has been in debt stemming secretary of defense. but i would suggest to you that leon panetta, who has served honorably and successfully in congress, at omb, at the white house, and of the ca, is

prepared and uniquely qualified to be another outstanng secretary of defense in this very challenging tim i think the committee. -- i thank the committee. >> senator boxer. >> i appreciate every word my colleagues about my friend, leon panetta. i will try to add more of a peonal side because i've known this man and work with them since 1982. he became onof my mentors. eventually, i served on the budget committee or he was the chairman, and i watched him very carefully reach out across every kind of line that would divide us. republican, democratic liberal, coervative, moderate. we were facing a lot of new, complex issues.

one was the eighth crisis -- one was the aids crisis. i remember saying there was a new disease and we have not done anything about it. he said, what do you hold some hearings and bring in the republicans, and we did. we were able to get the first funding for aids research. was ready to listen. he gets it. we have seen that in every single job that he has fulfilled. this is a man who has dedicated himself to public service, and we're so grateful to him. i won't go through every job he has held. it would take too much time. senator feinstein highlighted

anye many of those -- so mn of those. to be someone who could be such a trusted advisor that two presents have chosen him. i could go on the about leon. let me say what is meant to the people of california. he has recognized the importance of our resources in our sta te, namely our coa and our ocean. he said it this is an economic issue for us. he preserved the coast. he is a vionary. we saw the move into the cia and the rk he did and the latest issue and he can talk about does not do that much in terms of making sure that osama bin laden

was finally taken out. this was a bra mission by our military. leon panetta was a part of the decision making. i think at this time were york in gazed around the world and so many difficult conflicts, so many difficult conflicts, he is bringing out the intelligence perspective to the job. i would ask unanimous consent that my formal -- i want to turn to leon as a senator from california and say thanks so much for everything you have done throughout your career for this country. i know your origins. i know how proud your family is. i think we'll sure that pride in nyou. good luck and help the committee does as quickly -- good luck and i hope the committee does this quickly.

to stay.e both welcomed tuesda >> we have a bill on the floor. i will be going to the floor. >> you never miss a point to point.ur linda colorado mr. panetta -- let me call on mr. panetta. thank you again for your service to correct thinking, chairman -- think you for your service. >> thank you. i am deeply honored and humbled e as the e at new-paragraph hers

president's nominee. i thank my fellow californians who are dear friends and it dear colleagues for the role of secretary of defense, without question, it involves a very large responsibility in size alone. still, in a very basic way, it is the similar to the role of the cia director in that our first and foremost mission is to protect the country. if confirmed, my number one job will be to insure that america continues to have the best trained, the best equipped, and the strongest military and the world. in order to make sure that we

protect our country. as many of you know, i had devoted my career to public service. it began a long time ago when i served as an intelligence officer in the united states army. i was proud to wear the uniform of our country. my respect and admiration for our nation's armed forces has only grown the decade cents. my youngest son, jim, served in afghanistan and received the bronze star. i have personally -- i personally witnessed the tradition of service and sacrifice that drives each generation to fulfil a fundamental duty to our country. in addition to respecting that great tradition of duty, i have done a number of things to try

and prepare for this very difficult an challenging job. first, in the weeks since my nomination, i spent aumber of hours with bob gates. he is a dear friend. when he and i first got to know each other as we were building our careers in public service, we also served together, as you know, on the iraq study group. we ctinued to serve together as members of the president's national security team. we share a common belief that the national security of this country is the responsibility of all americans regardless of party. i, too, believe he will be remembered as one of the greatest secretaries of the defense and our nation's history for the way he led the department during a time of war

and for the crucial reforms he has tried to put in place in the way the pentagon does business. the are reforms that i intend to carry on. second, i talked with our service secretaries and a service chiefs. i believe it is important to have a candid, open line of communication between the secretary an all the service chiefs. they are the ones who are out there leading each of one of their services. i need to know what th're thinking. i need to know what is important in terms of serving the interests of the troops that they directly lead. one of those chiefs told me -- for our troops, there has been no shortage of war. indeed, we are a nation at war. our volunteer force has been stretched by combat that has

lasted nearly a decade. we owe it to them. oh to their families to insure that they have the best leadership, e best tining, the best equipment, the best benefits, the best health care that we can give them. i pledge t them and i pledge to you that every deployment decision that i make will be mindful of the stresses on our men and women in uniform and on their families. third, i have reached out to former secretaries of defense both democrat d republican. i ask for their advice. to a person, they impressed upon me how important it was to stay focused on the management of the pentagon. this is the biggest enterprise in our government. it requires focus and handsn management. which is the only way i know

how to do business. fourth, i sat down with many of you and have known many of you throughout my career. because i really do believe that congress has to be a partner in this role in the protection of our country, i am a creature of the congress. i believe that the pentagon is made stronger by your oversight and buy your guidance. as a young legislative assistant a long time ago here in the senate, i had the honor of seeing firsthand the bipartisanship of leaders le dick russell and henry jackson and barry goldwater. as a memberf the congress, i saw that tradition carried on by other great leaders. i believe deeply in the tradition of strong, bipartisan

national security leadership. you, mr. chairman, and you senator mccain, have carried on that tradition and i thank you for that. this is a time of historic change. unlike the cold war, when we had one main adversary, we face a multitude of challenges. al qaeda and other global terrorist networks, in places like yemen, somalia, north africa, not just fataa in pakistan. dangerous enemy spread out across the world. we face insurgents and militants who cross borders to conduct attacks. we placed the proliferation of dangous weapons in the hands of terrorists and in the hands of rogue nations. we face cyber attackers, a whole new arena of warfare that can

take last not only now but in the future. that is something we have to pay attention to. we face the challenge of rising and changing powers, in nations in turmoil particularly in the middle east undergoing enormous political transformation. we are no longer in the cold war. this is more like a blizzard war. it is a blizzard of challenges that draws speed and intensity from terrorism, from rapidly developing technologies and the rising number of powers in the world stage. despite the times we live in, there is reason to be confident. the operation that killed osama bin laden, in my view, has not only made clear to the world

that we will do what we have to do but it is also -- it has also given us the greatest chance cents 9/11 to disrupt, dismantle, and to defeat al qaeda. to do that, to be able to finish the job, we have got to keep our pressure up. if confirmed, my first task at dod will to ensure that we prevail in the conflicts we're engaged in. in afghanistan, we must continue to degrade the taliban. we got to trade security forces. we've got to help the government take ownership of their country so that they can govern and protect their country. in iraq, we must assure that iraqi military and security forces are prepared to safeguard

their nation. so that it can become a stable democrac in a very important region of the world. as we do that, i am very aware that we must be highly disciplined in how we spend the taxpayers' precious resources. this committee well knows that the days of large growth, on limited defense budgets are over. our challenge will be to design budgets that eliminate wasteful and duplicative spending. while proteing the core elements that we absolutely need for our nation's defense. i do not believe, based on my long experience in government and working with budgets, that we have to choose between strong fiscal discipline and a strong national defense. i don't deny that there will be

tough decisions that have to be made and tough choices that have to be made. we owe to our citizens to provide both strong fiscal discipline and a strong national defense. finally and most importantly, it is the job of secretary of defense to be a tireless advocate for our troops and for their families. it is their sacrifice and their dedication that have earned the respect of a grateful nation and inspired a new generation to volunteer to wear the uniform of our country. they put their lives on the line to fight for america. i will just as surely fight for them and for the families that support and sustain them. as director of the cia, i had no more solemn duty than sending

young people into harm's way with their lives on the line. after we lost seven of our colleagues in afghanistan in december of 2009, i had to do what my colleagues in the military do all too often -- visit the wounded at bethesda, attend the ramp ceremony at dover, offer a prayer at the site of an arlington cemetery graveside. a patriot who left this world to yawn. not one day will pass where i don' thi of the brave souls who have fought and died and those whoight today for our freedom. as secretary gates emphasized in his last trip to the troops, there will always be, in my thoughts, and prayer. if confirmed, i pledge to you

that i will always keep our troops for must in my mind and i will be a careful and accountable steward of our nati's precious resources and that we will have the strongest national defense in the world and that you will always have my best and most candid advice and that i will always, always seek yours. as you know, i am the son of italian immigrants. my father used to say to me -- i -- that to be free, we have to be secur that is the pledge that i make to you. i will do everything i can to keep america secure so that it can be free. i will do that if i am confirmed as secretary of defense. thank you. >> thank you so much. thank you for a powerful,

moving, and straightforward statement. we have standard questions which we ask of nominees. before we take turns asking our own questions, i will put those questions to you now. have you adhere to applicable laws and conflicts of interest? >> yes i have. >> when asked to give your personal use even of those views differ from the administration in power? >> yes i will. >> had assumed any duties are actions which would appear to present the outcome of the confirmation process? >> no, i have not. >> way we ensure that your staff composite deadlines esblished for requested communications including questions for the records in hearings. >> yes i will. >> will you providing cooperating wh witnesses. >> yes i will. >> wl these witnesses be protected from their reprisal? >> yes they will.

>> when you testified -- lee testified before this committee? >> yes i will. >> will you provide documents including copies of electronic forms of communication in a timely manner when requested by a duly constituted committee or to consult with the committee regarding the basis for any good faith delay or denial in providing such documents? >> yes, i will. >> thank you. we will be here all morning. we will then have a break for lunch and we will go into a classified session for this afternoon. minutestart with a seven- first round for questions. director panetta, you said that you support the july, 2011 date set by president obama for the beginning of a process of transferring increasing responsibility for afghanistan security to the afghan security

forces and drawing down u.s. forces from afghanistan. president obama recently said that the size of u.s. troop reductions from afghanistan will be significant. director panetta, do you agree that the u.s. reductions from afghanistan beginning in july should be significant? >> i agree with the president. there are approximately 100,000 more afghan police than the work in 2009. the nato training mission in afghanistan is ahead of schedule in meeting the target of 305,000 afghan security forces by this fall. in addition, a new target of 352,000 afghan security forces by 2012 has been set to ensure that these forces have the specialized skills needed to sustain these units are the long term. i very much support that decision. do you agree that training and

part offering with the afghan army and police in getting those forces as a lead and operations is key to the success of our counter insurgency strategy and afghanistan? >> yes, i do. >> pakistani leaders deny being aware of the presence of osama bin laden bin abbottabad. it is counterintuitive to believe that none of their leaders know it but nonetheless that is not my question. the pakistan leaders are well aware and acknowledge their awareness of the sanctuaries in pakistan by the hikani network and the afghan taliban it quetta. they a attacking our troops across the border in afghanistan and they go back to their sanctuaries its pakistan. a recent defense depart report called the extremist network the

most significant threat in eastern afghanistan. yet, the ikanis continue to enjoy open six border cross the border in pakistan. i think this is total unacceptable. i'm wondering if you agree and which should be done. >> senator, i share your coern with regards to the safe haven in pakistan. , particularly as it relates to groups like the akanis./ i strongly urge those in pakistan to take steps to do whatever they can to prevent these kind of cross border attacks and to prevent the safe havens that exist on the pakistani side of the rder.

this is a difficult challenge, the relaonship with pakistan is that the same time one of the most critical and yet one of the most compliced and frustrating relationships we have. it is extremely critical in that we're conducting a war against our primary enemy in their country. it is critical because of vital supply lines go through their country. it is critical because they are a nuclear power. there is the danger that those nukes could wind up in the wrong hands. at the same time, it is very complicated by the fact that they maintain relationships with certain terrorist groups, that they continue not to take aggrsive action with regards to these safe havens, and they

are concerned about the sovereignty results and criticisms of the united states when in fact my view is that the teorists in their country are probably the greatest threat to their sovereignty. having said all that, we have to maintain the relationship to do everything we can to try to spread -- strengthen their relationships so that both of us can work to defend both of our countries. >> director panetta, the president has called for $400 billion in reductions to national security spending over the next 12 years. do you have any understanding or a proposed breakdown of that $400 billion as to how mu he is proposing for reductions in pentagon spending? how much o that is intelligence spending? how much is he proposing to reduce in the home less curity

department? >> no, i do not. >> can you try to find that out for us? if you give us an estimate for the record -- >> i will certainly ask whether or not that decision has been made. >> do you know whether we will receive a budget andment for the fiscal 2012 dod budget? >> i don't know the answer to that ban on the question of torture, and your answers to the committee said the following -- i will insure that all interrogations' conducted by the department of defense personnel are conducted consistent with the army field manual and in accord with the geneva conventions. is water boarding consistent with the army field manual? >> i have taken the same position as president of united states. i think water board crossed the

line with regards to interrogations'. the president outlawed the use of that plus other enhanced interrogation techniques. in an executive order he issued when he first came to the presidency. >> recently, i don't want to switch gears to much because time requires that we do that -- as senator web and i recently went to zero canal, guam, and center web was in korea before that, senator mccain and senator web and -- centre mccarren obviously has a great personal experience in this area -- we proposed changes to basing plants on okinawa and guam. we issued a review of the plants in korea because we believe that the current plans are unrealistic, unworkable, and affordable.

independently, the gao concluded the cost of these military realignments were higher than expected. in many cases, there were largely unknown. in a highly critical gao report of this direcon that we are currently moving. i am wondering whether you are familiar with this issue and it confirmed in any of and whether you are familiar with these issues are not whether you will agree to review this matter and work with us to find a solution that hps advance our strategic objectives in the reason. we had strategic objectives and the reason and if they are currently on affordable, they are unknown in terms of cost and whether you be willing to review this matter and work with us?

>> yes, i will. you discussed this with me when i -- when i metith you and also center web discussed his concerns about that area. i agree with you that is a very important strategic area for the united states. we have to maintain a presence there. there are many issues that have to be resolved and worked on. i look forward to working with you, senator mccain, centre wave -- center web and others to find out what the most cost-effective approach would be. >> thank you. >> thank you very much. what is your assessment of the battlefield situation in afghanistan cents we inaugurated the surge? >> the assessment is that we have made progress with regards

to security in that country. it is fragile and reversible. i nevertheless believe that progress has been made to try to advance security. we also have made good progress in training the forces there in afghanistan both police and military force. i think the area we are -- where greater progress means to be made as a government side. we want to make sure they improve our government so they can ultimately take responsibility for the country. >> and so, would you agree - when you point out is fragile and reversible, i think that is absolutely accurate. would you agree with secretary gates repeated a strict statements that the withdrawal should be modest? >> i agree they should be

conditions-based variable live up to secretary dates and general petraeus and president to provide with that number should be. >> if you or the secretary of defense when that decision is ma, obviously, you will have significant influence. he just came from a position where you have a good assessment of the military situation. i think it is not inappropriate for you to answer when asked if you agree with secretary gates and his assessment that the withdrawal should be modest. >> senator, if i am confirmed, i will have to obviously arrived at a decision myself. i will have to ultimately present that to the president and i am not position -- in that position now and tha decision rests with general petraeus and secretary gates and the president. obviously, i have tremendous admiration for secretary gates. i pretty much what the and and and and these issues. with regards to specific numbers,

>> i wasn't asking for specific numbers. on the subject of iraq, if the afghan government and all its elements agree there should be a residual u.s. military presence in iraq particularly in three areas, air defenses, intelligence capability, and security in the areas around kirkuk in iraq where there have been signifint tensions, do you agree that would be wise thing for us to do? >> i believe the prime minister of maliki and the iraqi government request that we maintain a presence there that that should be to seriously considered by the president. >> do you think it would be in our interest to do that?

>> there are 1000 al qaeda that are still in iraq. we saw the attack was made the other day. it, too, continues to be fragile situation. i believe we should take whatever steps are necessary to make sure that we protect whatever progress we have made their. >> do you know of anyone authority orn the congress or the administration who believes we should send ground troops into libya? >> i have not met anybody at who supports that. >> i have not either. i think all of us -- would be a great mistake. do believe is the proper role congress to restrict the powers of the president ofnited states to act? we were around when there is a

vote of cut off of funds. right or wrong, that was the appropriatrole of congress. does it rry you if the congress begins to tell the commander in chief as to exactly what he can and cannot do? >> i believe very strongly that the president has the constitutional power as commander in chief to take steps he believes are necessary to protect this country and protect our national interests. obviously, i think it is important for presidents to consult and have the aes of congress but in the end, i believe he has the constitutional power to do what he has to do to protect this country. >> i agree. in 2007, the last time we went through a very serious crisis that was concerning whether we

should withdraw from iraq or not, i see some parallels. we're getting it rising war weariness in american people. and one thing we did at that time was set up some benchmarks th we expected to be met by both the iraqis and the united states which i recall, there were 13 or a number of those. over time, most of those benchmarks were met. do you think it would be appropriate for us to do the same thing as far as afghanistan is concerned? we can measure progress by certain metrics. i think it would be important in order to gain or keep the confidence of thamerican people that we should set up some benchmarks for progress both in afghanistan and as far

as pakistan is concerned since we're sending billions of dollars of taxpayer money to pakistan. >> i think we all know what the fundamental goal is he which is to develop a stable enough afghanistan that will never again become a safe haven for al-qaeda or -- >> my specific question the ---. >> working with the president and establishing some of those areas where we need to make progress

the ira nuclear ambitions and to end them however, as president obama has said, all options have to remain on the table. i want to ask you whether as secretary of defense, you'll consider it to be one of your responsibilities to have credible milary plans to strike and destroy the iran nuclear facilities if the prident as commander-in-chief dedes that it is necessary to use that option. >> in line with the president's statement that we should keep all options on the table. >> let me approach afghanistan this way -- i thought the

correct andade a courageous decision in 2009 in deciding to raise the number of our forces in afghanistan by 30,000 +, a so-called afghanistan surge. at the time, a statement was made that we would begin to draw those troops down around july of this year, 2011. there was a lot of anxiety in the region, particularly in afghanistan and pakistan about whether that was the beginning of a kind of early withdrawal and a retreat from the region. discussions were had particular between us and the afghans and present obama settles with president karzai on a plan that will begin the transition around july of this year but the goal

is to remove affectively all of our forces unless there is a mutual agreement to the contrary before then by the end of 2014. u.s. said today and in your prepared answers that you thought we were making measurable progress in afghanistan. but that the progress was reversible. rather than asking you to adopt an adjective that smaltz has put sayhat, is it fair to sai that the standard you apply to the drawdown of american forces that would begin of july this year, that it not be so great as to risk the gains we have made which you have said are reversible? >> there is no question that we

should not take any steps that risk the gains that have been made. i have great confidence that general petraeus and secretary gates and the president will make the right decision in a transition that will take place going towards 2014. >> is it fair to say that if you are confirmed that the goal here that you see is to turn responsibility for security of afghanistan over to the afghans at the end of 2014 and not to jeopardize our capacity to do that before then? >> that is absolutely correct. at the lisbon conference, 48 nations plus president karzai made the decision that there would be a transition going toward 2014. it would be then that hopefully we would be able to transfer responsibility. we should do nothi that

jeerson -- jeopardize is that pat. >> i appreciate that the love me brief you -- but let me read do something from secretary gates. "once you have committed, the success of the mission to override everything else because the most colleges -- cost a thing of all would be to fail." did you agree with that? >> absolutely. >> i appreciate your answers to those questions. let me move to another part of the world. at the endf the last century, if you ask most people up here and the defense and state department and ciaould be our focus in this century, they probably would have said that the asia-pacific region would be the strategic center of gravity of the 21st century. we were necessarily distracted by the attack on us on 9/11 and i ink we responded with remarkable courage and

effectiveness. i think that the asia-pacific remains the strategic center of gravity for the 21st century. we have found that there is an anxiety among our friends from asia about china's growing military capabilities and america's staying power and commitment to the region. wanted to give you an opportunity to speak to that anxiety, that if confirmed as secretary of defense, not withstanding the budget pressures on the u.s. government, would ourtrategic involvement in the asia-pacific region in your opinion continue to be a national security

priority? >> absolutely, i think that region is very important to us from atrategic point of view. we have to maintain a presence in the pacific are a breed that and i think in line with that, we have to maintain a relationship with china. we want to build that kind of relationship for the 21st century. i think it is extremely important. there are concerns about some of the things they are doing in modernizing their military. at the same time, i think we have to be able to work with them in terms of scale and transparency so that we are working together and not in opposition to one another in order to make sure that we protect the security of that region. >> on your watch as secretary of defense, you don't anticipate any withdrawal or retreat of america's commitment to the asia-pacific?

>> not at all. >> thank you very much. >> centre chambliss. >> thank you for yr willingness to continue to exhibit great public service. you and i have had the privilege of working together for many years since i was a freshman member of thhouse. you were a member of the clinton administration and i don't need to talk to you about how many years that has been. i respect your service and value our friendship. i would say that i know you will be the first to credit the many hard-working, very professional men and women in the intelligence and military community that led to the successful takedown of osama bin laden and you would be right to do that. without strong leadership at the top, that mission would not have been successful and i get a lot of that credit of that mission to you and it is well deserved. you and i had the opportunity to talk about the issue of rising health-care costs in the

department of defense budget when we visited a couple of weeks ago. i notice you had sever questions on the issue in your policy questions and i appreciate your responses. i don't have a question on this but as the chairman said earlier, y will have a very difficult job when it comes to trying to find savings and become more efficient at the department of defense. there is no bigger expense, at least from the standpoint of increasing annual late, the health-care costs. i want to reemphasize the fact that this an extremely important issue and we need to g our arms around it and i look forward to working with you. i encourage you to think creatively. i want to go back to the line that senator mccain was addressing on afghanistan.

regarding the troop withdrawals, i think it is clear that any operational perspective that the withdrawal makes no sense. it may make sense from a domestic political perspective. may make some level of see in terms of waking up the afghans. the fact that we will not be there forever and that that they have to set up to the plight but i am concerned that a significant withdrawal of u.s. forces will reverse the progress that we made in afghanistan and that the afghans have made. i am glad to see you say you support a response will conditions-based withdrawal. however, i would prefer their to be no withdrawal until it is clear that the gains we have made will not be reversed. my question for you is as we withdraw troops from afghanistan, if it becomes clear from an operational perspective that the withdrawal

is negatively affecting progress and stability, will you advise the president that the withdrawal should be stopped and, if necessary, additional u.s. forces be sent back to afghistan? said and as the president has said and the secretary has emphasize, this has to be a conditions test based withdraw. that meansou look at the conditions on the ground. we need to do everything we can to try to call police stay on target with regard to the 2014 date. it is conditions based and based on what changes take place, the president and secretary would ve to make adjustments. >> i would hope for my conditions-based standpoint, leon, that you would give strong consideration to the safety and security of our soldiers. i know they are of #one

importance to you. if withdrawal of troops puts our men and women in gridder harm's way, -- in greater arms way, i would hope that we would cease the withdrawal. i hope that would be your recommendation to the president. >another issue i want to bring up that we have discussed is the issue of tactical aircraft and this generation fighters. -- and fifth generation fighters. secretary gates argued that f-35 ma the airplane of the future. however,t a recent hearing, last month, the secretary indicated that dod has taken money out of that program to buy fourth generation fighters. not only are these fourth generation fighters costing billions of dollars but they

will be in the inventory for probably 20-30 years. we will be paying to maintain and even at a greater cost. there utility is greatly limited against any kind of modern threat. in my view, this is not a very good way to spend taxpayer dollars. what is your pspective on this issue? if confirmed, will you be committed to preserving u.s. supremacy in air dominance and ensuring our resources are spent most wisely toward that end? >> obviously, i want to make sure that we have the very best in terms of our fighter planes. 35 is being35he f- developed as the next-generation fighter but there are substantial costs associated with that. i think weave to watch it very carefully.

i want to assure you th one of my responsibilities in line with what senator mccain said is to take a very hard look at all weapon systems to make sure they are cost-effective and they are providing the very best equipment our forces need. >> what concerns me about where we are with that program is exactly what senator mccai alluded to and that is that we st seem to be out of control. we keep moving the goalposts with contracto and blaming contractors for an increase in costs when frankly part of it is due to our inefficient management of the system. if we are going to spend the kind of money that we are committed to spe on that fifth generation fighter because -- that is where we are headed. we all know that. we've got to have that airplane in the inventory. the decisions that will have to be made by u.s. secretary of

defense relative to procurement, to acquisition, as well as the testing of that airplane will be crital. you bring a wealth of knowledge from that perspective from your years at omb and where youre today. again, we look forward to dialogue with you and this committee on that issue as well as our other acquisition issues that are going to be before you. let mesk you one other matter lative to libya. i notice that you agree that the gaddafi regime must go. how're we going to do that? >> as the president has said,

that is the objective. it has to be done by a number of means. number one, we are bringing strong economic sanctions against them. we are also bring strong diplomatic pressure against them. we have implemented embargo and more importantly, the work that nato is doing pursuant to the un resolution and the nato forces that are there. are bring tremendous pressure, i believe, on them not only fighting to protect civilians but to implement the no-fly zone and in addition to that, target the command and control elements of the regime. i think all those factors have to continue in order to put pressure on gaddafi. frankly, i think there are games that have been made. we have seen the regime weaken significantly. we have seen the opposition make gains both in the east and west.

i think there are some signs that if we continue the pressure and stick with it that ultimately that gaddafi will step down. >> thank you for this service and i look forward to continue to working with you. >> senator reid. >> thank you f your extraordiny public service and particularly in the last few months, you're decive and courageous advice to the president was led to the successful raid against osama bin laden. it would not have been a successful or affected without your participation. thank you personally for your friendship over many years. let me return to the topic of afghanistan. we're looking at a decision shortly that will be based on nditions on the ground but strikes me and implicit in what you say it your testimony, those conditions on the ground might be more relevant according to

pakistan and afghanistan. as long as the government of pakistan at least appears to see some of these groups, these terrorist groups and their soil as strategic assets a liabilities, our operations in afghanistan are going to be very, very difficult. going to the real conditions on the ground, your comment on whether those conditions are really more about pakistan, our focus has to be there as much as afghanistan. i would include in this context some type of regional dialogue including pakistan, afghanistan, and india. what are your comments? >> i would agree with that. it is pretty clear that we cannot succeed in afghanistan if we are not succeeding in pakistan in terms of controlng

the safe havens and the cross border operations. we've got to work at both in order to ensure that we are able to stay on path with what we would like tochieve in afghanistan. in addition to that, i agree that this is a regional issue and to the extent that the countries in the region can work gether and relate to each other instead of being suspicious of each other, creating the kind of dymic that frankly has not been very helpful. i think it would be in the interest of peace in that region if we could get all three to continue to work together to advance the se goals. >> one of the points i believe your predecessor made and we are recommending an for example reservists -- one of the challenges you have is following an extraordinarily talented, successful, and decent human being.

you have a challenge. secretary gates pointed out that -- how important non- dod agricultural operations are. we're also getting into the spectrum of these violent climate esodes throughout the globe. there is a real danger here that those budgets might suffer. infghanistan, my colleagues in the foreign afirs committee has released a report criticizing the bill stage of the operation. can you comment upon that partnership and how critical it is? when we look at the conditions on the ground, we could be successful interdicting terrorist groups, seizing caches

of weapons and even interdicting transmission from pakistan. if there is no political capacity or governmental capacity on health care education or anything, we will still have a population that is disgruntled and probably destructive towards us. >> i agree with what you said. it has to be the whole government approach. as we deal with these issues. the state department place an important role in providing assistance to individuals to insure that an area remains secure. aid, the education area, the justice department provides assistance. the area of agriculture also provides some important assistance. i know the department of defense is our primary military weapon in terms of securing ars.

if we do not follow it up with these other important assets, we will never be able to fully secure these countries. >> let me change topics for a moment. it strikes me that -- this is not particularly a great insight -- i am old enough to remember when there were three dimensions of conflict, air, land, and say. see. there's a whole new dimension, cyber. i don't think we know enough yet to be fully converse of what can you comment briefly on the strategy that you will try to develop? i assume that strategy will provide some deterrence. i assume it will do pre-emption, offense/defense and as was just indicated, the policy within the context of the rules of war,

what would constitute some type of attack. you are stepping in at a critical moment where we are just beginning to develop a strategy for new -- for a new dimension of warfare that we have not confronteyet and your leadership will be critical. >> there is no question that the whole arena of cyber attacks, developing technologies, in the information area, represents a potential battle front for the future. i have often said that there's a strong likelihood that the next pearl harbor that we confront could very well be a cyber attack that cripples our power system or our great, perhaps our security systems, our financial systems, our governmental systems. this is a real possibility in today's world.

as a result, i think we have to aggressively be able to counter that. it will take both defensive measures as well as aggressive measures. most importantly, there has to be a comprehensive approach in government to make sure that those attacks don't take place. i have a huge responsibility of being confirmed in his new positionn dealing with the cyber area. my goal would be to work closely with them and others to develop not only the capabilities but also the law but i think we need to havin order to determine how we appach this challenge in the future? >> just one final topic -- there is an acquisitio bywave coming as he recapitalize. that has been pushed off a bit

and that is -- it has been deferred a bit but it is coming. one aspect is that it is not simply the sheer number of systems that we have to buy, land, sea, and air and others, is the price tag on each of these systems. i know secretary carter has en working hard to make affordabilitpart of th design. all those efforts will be necessary because there will be no room with even -- within even a generous budget that h to do everything we have done. what your comments again? >> in the briefings that i have had, it is obvious that this is an area we have to pay a lot of attention to. \ because of the efficiencies and competition and the nature

of expanding contracts that have taken place there. we have seen these weapons systems grow in cost. it takes an extraordinary amount of time from theeginning of moving the kind of weapon system to the time is finally developed, finallyeployed, it almost becomes outdated. we've got to improve the process. i know congress has taken steps in that arena. i look forward to working with you and the members of this committee toake greater steps in order to insure that we are looking at every possible efficiency in the procurement to read that in order notnly to save dollars but make sure that we are getting better and equipment. >> senator brown. >> thank you. good to see you again sir. i look forward to voting to confirm you.

thank you for holding this hearing, mr. chairman. i echo lot of the same thoughts my colleagues do regarding the cross border operation -- cross border operations. the tremendous amount of aid we give to pakistan which is over $4 billion, gives me deep concern that if we try to move forward with completing our mission and bringing our men and women home in afghanistan, that we're having these areas where you have the safe havens yet we are giving them billions of dollars in aid. are you with us or not? what is your position with regard to carryinthe message to people like me and others in people like me in congress are getting frustrated with that complicity. >> secretary clinton, chairman

mike mullen and myself, my deputy, who was just here, have all made the same point. we need to have their cooperation. we need to have their partnership in confronting what is a common enemy. terrorism is not just our problem. it is their problem. they are the subject of attacks every day from terrorist. s. it i in their interest to take action to control terrorism within their borders. in a relationship and a partnership, we expect a two-way street. it has to be two ways to protect both of our countries. >> the fact that bin laden was

there -- if they did not know he was there, i do not believe it. i am hopeful that message can continue. when i went over there, i conveyed that same message as well. when you are walking down a hallway and a media group grabs you and says, what is the mission in afghanistan? what should i convey to the people in massachusetts now that we have made progress there? what should i can they? what do you can they in your everyday conversations? what is the mission in afghanistan right now? >> the fundamental mission in afghanistan is to provide stability so that that country does not become a safe haven for al qaeda. >> your plan for achieving that mission by setting benchmarks

that will hopefully be attained so we can set back and bring our men and women home -- let me ask you that first. >> the president has made clear that there are goals that we are continuing to work on. we need to weaken the taliban. we need to delop the structure in afghanistan and in the army so they can assume these responsibilities. we can develop the government so they can provide greater stability for the fure. each of these areas need to be focused on so that we can arrive at our goal. >> is it your opinion that there are people in the government to do that? can they be self-sufficient? >> i think there is. in the discussions i have had, i think they want their country to succeed. it is not always easy.

this is a tribal society. >> there is very little interaction with the central government. >> it is difficult. they understand that, ultimately, this is eir country. they are going to have to provide the security. >> i am also deeply concerned. i keep hearing reports that money we are providing is going out to terrorists. is that something you have a comment on? >> we havto continually over see th to make sure that does not happen. i do not deny that there has been corruption in that country. we have to ensure that one of their responsibilities as a government is to make sure that does not happen. >> just to shift giears a

shift-- gear a little bits. . people are hopeful they can share in the privileges that people in our country have. there is deep concern about what is left after these transitional periods. we have given billions of dollars in military equipment. in egypt, they will have upcoming elections. depending on who is in power, they are still receiving a bg. -- aid. i am concerned about israel and their safety and security. i am concerned about that region. what are your thoughts on our relationship with israel and the transition going on in the middle et? >> we will and have to continue

to maintain a strong relationship with israel and that part of the world. we have to reach out to other nations in that part the worldf we are going to preser peace in that region. this is an area that is in great turmoil. a lot of countries areoing through turmoil -- tunisia, egypt, bahrain, yemen. there are a number of countries that are dealing with uncertainty. the united states has to work with each of these countries to ensure that they reduced violence, to ensure that they are recognizing some degree of human universal rights, and that they are implementing economic reforms. it is not easy. there are tremendous changes going on. we have to play a role in what is developing in the so-called

arab spring. as the spoke to that. if we do not, there are other countries in that region like iran that will try to influence what will happen. we cannot afford to let that happen. >> thank you senator brown. senator akaka. >> thank you, mr. chairman. i would like to say aloha and welcome to director panetta, who is a dear friend and a former collgue. there are so many things we can talk about. i want to tell you that i was impressed with your opening statement. what else can i say as we consider a person who was nominated by the president to be secretary of defense, who would be a tireless advocate oour

military, and who will bring about support and sustain them. ? this will be in your thoughts and prayers. having a free country, a country that is skilled and you will continue to bring strong discipline and national defence for our count. with all of this, i want to wish you well. you certainly have my support. you will face significant challenges if confirmed. the men and women of the armed forces are involved in two major conflicts that are taking a tremendous toll on our armed forces. we must do al we can to care

for them. fulfilling our sacred obligation is dependent on department of defense cooperation. you stated in your response that you would ensure that the department of defense continues to work closely with the veterans administration to support members of their family. we talked about working on the collaboratio between the department of defense and the veterans administration. as we carry on into the position of secretary, you certainly have my support. if confirmed, what will be your top priorities as you look to care for men and women in uniform and their families?

>> sator, my first and foremost priority is to protect thisountry. i cannot do it unless we have good fighting men and women who are willing to put their lives on the line in order to defend this country. i think we owe it to them as a result of that, and we owe it to their families, to make sure we are doing everything possible to meet their needs. providing the kind of health care, the benefits, the counseling that is necessary, particularly for woued warriors, making sure they can transition to the vetan's administration in a seamless way -- these are areas i have to pay attention to.

i have seen it firsthand. these kids are out there and they are putting their lives on the line. we have asked them to go their time and time again. we have got to make sure they know they are fully supported in this effort. it is going to be my job if confirmed as secretary of defense to ensure we are providing those benefits. i want to work with people like yourself who have been working with this for a long time to make sure we are covering all of the bases. >> i am impressed. you told us by steps of what you are planning to do. social reforms. i thought it was unique what you wanted to achieve. the secretaries who work

together and share their concerns as well -- you want to work on a pentagon establishment. this is important to regard congress as a partner and to deal with the challenges of natis that are rising and changing, as you mentioned. the chief financial officers act of 1990 required the department of defense to prepare financial statements, which were found to be ultimately unreliable. in 2010, the department was required to provide auditable

financial statements by 2017. i believe in accountability. we want to complete and accurate financial information from the pentagon. this would allow the pentagon leaders to make better informed a limitedin environment. if confirmed, what will you do to insure the department meets these requirements? >> senator, i was concerned in finding out that the department would not be able to achieve full aitability until 2017. i understand how areas of the budget develop. the american people should know that there is auditing that does

go on in each of these areas. a department, we should be able to audit that department. if i am confirmed, one of the first things i will do is to see if we cannot take steps to improve on that timetable so that we can say to the american taxpayer that what we are spending on national defense is being fully audited. >> d.o.d. is one of the few departments that has recognized the importance of maintaining its language and cultural awareness capability. they lead the national language service corps and have activities with other federal agencies. what are your thoughts on the importance of cultural and foreign language capabilities within the department of

defense? >> i am a big believer in language training and in getting our people equipped with the ability, not only to speak the language, but to understand the culture of the countries we are dealing with. it is good for each individual to have that capility. it is important to our national defense to have that capability. at the cia, i have developed a requirement for analysts and operations officers to have language capabilities. it makes them better individuals and better intelligence officers to have that capability. at the defense department, we need to also encourage greater language training so that they understand the language and the culture of the countries they are involved with. having that capality makes us much better at doing our job.

>> thank you. >> thank you senator akaka. >> thank you, mr. panetta, for your leadership and service to our country. cutpresident's proposal to $400 billion, do you agree with that proposal? it a realistic number in terms of our national security, preserving our national security? >> obviously, i agree with the commitment of the president to try to take action to reduce the deficits. . i do want to say that there is a comprehensive review that is going on that the president himself stated would take place. that comprehensive review is looking at a number of issues

related to the defense department in order to determine what are theight areas, what is the right transition in order to achieve that savings. i look forward to the results of that comprehensive review. >> as a follow-up, you expressed your admiration for secretary gates. i share that admiration for his service to our country. you made recent statements expressing concern over the $400 billion proposal. you said it cut in the meat in terms of the muscle up our defense. do you disagree with him on that front? >> no. i share his concerns about the possibility of calling out our forces -- hoowing out our forces and implementing some

kind of formulaic approach in cutting defense. we have to look at each area to determine where we will achieve savings. obviously, i share those concerns. i want to lo at that comprehensive review to ke sure none of the concerns secretary gates has raised or that i am concernedbout take place in seeking those reductions. >> in conducting that review when you get into the position of secretary of defense, if you disagree that $400 billion is a reasonable number ancould jeopardize our national security, would you express your opposition to the president on that? >> if the end result of that comprehensive review were to come to that conclusion, i would share those concerns. i do not think it will. if there were something that indicated that our national

defense would be impacted, i would sharehat with the president. >> i wanted to ask you about the cia and interrogation. does the cia currently condu interrogations' of high-value targets -- interrogations of high-value targets? >> when a high-value target is captured, there is a high value interrogation team that comes together that involves the army, the fbi, and the cia working together as 18. they will go -- working as a team. they will go and do the interrogation as a team. >> does the cia do the interrogations themselves?

as i understand, while the dissipating in the haight, they have not been doing -- while participating in the hague, they have not been doing the interrogatns. >> they will share with each other what questions should be asked. it could be the fbi or the cia. everyone's in a while, the cia asks qstions. >> is there anything keeping the cia from conducting interrogations? >> if intelligence is the primary objective, the cia individual becomes central to the questions being asked. that is the way it works now.

if there is an emphasis on that, that is one case. if it is a military case or an individual that could involve follow on the military, they would take the lead. they work as a team and they do it on a case by case basis. >> nothing prohibits the cia from being the lead in conducting investigations? to your knowledge, does it happen now? i understand it is a team. >> it is not the direct interrogation that used to take place early on in this decade. it is much more of a team approach. that is the way it works. >> i wanted to follow up with respect to the detainee

treatment act. do you agree with all of the provisions of the detainee treatment act, including the provisions to provide legal authority for terrogations'? -- interrogations? >> i honestly, i agree with t law. >> you talked about your view on waterboarding. do you think all enhance interrogation techniques crossed the line? >> i do not have the same you with regard to all of the other enhanced techniques, but i do with regard to waterboarding. >> right now, under the president's executive order, interrogations is limited -- are limited to the army field manual.

there are some interrogation techniques that do not cross the line and are not involved in the manual. >> it is primarily the army field manual that is the primary diet to interrogations. >> to the extent that some of those techniques may be permitted, would you necessarily disagree with the law contained in the detainee treatment at? >> it is permitted under the army field manual, i would support that. >> my time is up. i appreciate you answering my questions. >> thank you, senator a lot -- senatorsayotte. -- senator ayotte.

>> mr. panetta, you will inherit two wars. you will be passed -- tasked with reshaping the department of defense and taking care of military filies. with respect to afghanistan, there has been quite a bit of discussion about the need for behmarks to do assessments for where we are in the transition to the afghanistan capability of defending itself so that it can govern itself ing forward. have been a prime supporter of the benchmarks with regard to iraq and with respect to afghanistan as well.

i am introducing legislation today that will require benchmarks to evaluate progress being made toward the transition, security responsibilities to the government of afghanistan. the bill would call for benchmarks on transition to be included as part of the already established provisions for afghanistan. i think it was being -- was the 1230 and 1231 reports. i am impressed with your support of evaluation methods so that we are not in a gray area with regard to whether we are winning or losing. this is an opportunity to describe what level of progress we have made.

i am encouraged by many of my colleagues on both sides of the aisle talking about the benchmarks as well. if we intend to transfer security responsibility to the afghan government by 2014, it is important to mark our progress. do you have any preliminary thoughts as to the kinds of things you might look as as part of benchmarking to help you evaluate conditions on the ground as to whether we are making satisfactory progress to say we are 25% there, 50% there or whether we have 50% left to go? >> to establish any mrics or guideposts, it is important that general petraeus and our

diplomatic leaders and the administration participate in trying to line did the five those areas that are important. clrly, levs of violence is an important area to look at. a district assessment that looks at each district and tries to determine disability in ch of those areas, -- determine the stability in each of those areas, developing the afghan army and police and how they are performing. that is an important element. obviously, the government responsibilities within afghanistan. those are all key elements that need to be evaluated. >> in your view -- it is a unique view as the director of cia -- can you give us some idea of the impact the death of

osama bin laden might have on the campaign going forward in afghanistan and keeping it from a safe haven for future al qaeda operations? >> with regd to specific intelligence on that, it is probably appropriate in another forum. it is enough to say that the death of osama bin laden -- there is no question it pacted al qaeda. he was their leader and it impacted their capability. obviously, there are a number of operations that were impacted under their control and command operations. having said that, they still remain dangerous. they are dangerous with regar to the efforts they continue to work at in pakistan. one of the concerns i will share

with you is that i think we have to pay attention to these notes that a developing. al qae has moved some of its operations to places like yemen, somalia, north africa. those are areas we have to continue to focus on. yes, it has had an impact. it has weakened them. they still remain dangerous and we have to go after them. >> i agree with you and i appreciate that view. we have had a touchy situation developing with respect to pakistan in terms of what level of support osama bin laden may have had from anyone involved in the pakistani government. it is a complicated relationship. we understand. the american people are quite coerned about double-dealing.

you cannot have your friend be your enemy at e same time and have your friend working against you. do you think the relationship with pakistan is transparent enough at the present time? is there something we can do so that the american public can make a better determination of that relationship that we share with the government of pakistan? >> we have to continually work at that. we have to work at developing a relationship of trust with the pakistanis. i not know if we are totally there yet. there are areas where we have good discussions and good communications. there are a number of areas where we do not have that level of trust or communication capability. we have to work at that.

we have to develop it. it is in the interest of both countries to have a trusting relationship. terrorism is an enemy not just of the united states. it is an enemy for pakistan. >> do you think an internal investigation with some level of transparency within their governnt to try to determine responsibility for anyone who may have had involvement in trying to protect the presence of bin laden in their country -- that that will be fruitful? if it is through the fall, that it will be looked at as credible by our government and by the american people? >> at this point, we do not have any intelligence to indicate there was any relationship here. having said that, i do believe that the pakistanis are

conducting several investigations at different levels to try to investigate what took place. it would be important to see what the results of those investigations are. >> thank you. good luck in your new position, which you are about to achieve. >> thank you senator nelson. senator gramm? senator graham? >> thank you. i think the president has put together a top-notch security team. you are an important part of that. now for the tough questions. there is no place you can go to protect you from the justice of the american people. my general belief is that this

war is more complicated than killing terrorist. do you agree with that? >> yes. >> we have to fight the terrorist in their own backyard. don't you agree that takes more time? >> it absolutely does take more time. >> do you agree that the payoff is more enormous if we can get it right? >> that is right. >> what happens if we lose in afghanistan? >> if we lose in afghanistan, we not only create another safe haven for al qaeda and for their militant allies, but the world becomes a much more threatened place because of that loss, particularly in that region. >> i cannot agree with you more.

what do i tell a famil in south carolina that has lost a son or daughter in afghanistan to an i.e.d. that we cannot do anything about? what do i tell them? >> that is one of those situations that is frustrating and enduring -- and angering. we have got to say to that family that we are not just walking away from that responsibility. we are continuing to put pressure on those countries and about. >> i could not agree with you more. i trust you and general petraeus to deliver that message. on behalf of the people of south carolina and most members of this committee, if you are

living in pakistan, you need to choose. it is in your interest to fight the people who would undermine afghanistan and pakistan. i amll four winning in afghanistan. pakistan needs to get with the program one way or another. the pentagon itself. do you agree that the system we have to provide weapons -- the more time it takes to develop a weapon, the more money the contractor makes. isn't that kind of stupid? it really is. i do not blame the contractor. i blame us. what if we said to the contractors, you are welcome to bid on major weapons systems, why don't you share 25% of the development costs? if there are any overruns, you share in the overruns. >> i think that is a suggestion worth looking at.

>> one thing i would like you to do is go back in the past. how much money would we have saved in the last 20 years if we had had that arrangement? it is a way to save money and get weans done quicker. when it comes to iraq, ifhe iraqis asked us to provide some troops in 2012, secretary gates said he thinks that would be smart. do you think that would be smart to say yes >> yes. >> do you think secretary gates has a pretty good view of what is going on in the world? if he said 5000 makes sense when it comes to do live with trawl, withdrawal, do

you agree with that number? >> would you consider that request? position petraeus' and the president also position -- all that should be considered. they have a pretty good view. >> when it comes to libya, if gaddafi stays, what does that mean to our national security interests? >> it impacts on our national security interests if that happens. it sends a terrible signal to other countries. >> do you think it tells the iranians that you do not have to fear america when it comes to developing nuclear weapons? >> it tells them our word is not

much if we cannot stick to it. >> when it comes to detainee's, if we captors someone tomorrow -- when it comes to detainees, if we captured someone tomorrow , a high-value target, do we put them in jail? can i tell you with admiral mullen said when asked him that question? he did n have an answer to that question. do you thi that is a smart policy to be a nation without a jail in the war on terror? >> we need to provide for detainnt of these individuals. >> guantanamo bay is a good candidate. it is the only one left. am interested in making sure

afghanistan never becomes a failed state. secretary gates said today and in february when i asked him this question that he bieves that joint basing past 2014 where you would have american air power left behind in afghanistan in a joint in climate in training in counterterrorism if the afghans requested would be a good policy for us. do you generally agree with him? >> the president has made clear that we have to make a long-term commitment to stability in that region. >> i will read what secretary gates said to my question. "a security agreement with afghanistan and some kind of joint facility and training for

counterterrorism beyon2014 would be in our interest." do you think that is a reasonable statement? >> i think is worth looking at. >> you are taking over at a time when the budget for the nation has never been more out of whack. you have got a big agenda to fulfil. what would you tell the american people in terms of thettitude we need to take as a country? address their war weariness and tell them why we should stay behind in iraq and why we should consider a long-term relationship with afghanistan. why is it so important that we continue to stay in the fight after 10 years? >> it goes back to myather's

statement. if you want to be free, you have to be able to establish some kind of peaceful solution to these challenges abroad. >> tha you, a senatorgraha -- thank you, senator graham. senator mccaskill. >> thank you. part of our mission is to secure and stabilize and enhance the infrastructure. i want to commend to you and ask you to direct the folks who work with you to pay attention to some of the findings on the commission on wartime contacting. they issued a report last friday. it is full of basic information that seems to be escaping us in the area of contacting and contingency operations.

that is two important factors. one is security and whether or not security is available and appropriate to support the building of projects we have put a lot of money in. we saw this in iraq over and over again. we would build a power plant. we would work on an oil refiner we and two months later, it would be -- and oil refinery and two months later, it would be blown up. the second one -- this report came out on friday and it was an important report -- that is sustainability. we have white elephants all over this part of the world brought to you courtesy of the american taxpayer. the the sustainability part is

-- i will read you one part of the report. a project carefully planned, well executed, and economical. it will be wasteful if the host nation cannot provide a trained staff, provide fuel for necessary maintenance or produce the intended outcomes. we have one of these white elephants we spent $300 million on in kabul. they made a commitment to us that they would fuel it and now they say they cannot afford the fuel. this makes it complicated in terms of the tenology. now it is used as a backup for buying electricity from other countries. this is a great example. it can be replicated over and over again. i understand the mentality. i respect general petraeus an

his strategies in terms of counteriurgency. there is this myopic focus. if we can build this project and put people to work, this is good. this is what counterinsurgency is all about. they do not think what it does point to look like in three or four years. especially -- what is going to look like in three or four years. this is not a nation that is ready to take over anything, including some of these projects we are building. i think if we do not begin analyzing sustainability at the front end -- i will make a formal request to you that every project being built right now whether it is a road or a health care center or a school -- every project be analyzed right now for sustainability. if it is obvious it will not be sustained, we have to pull the

plug. this is tens of billions of dollars that have gone down a rat hole because w did not think about what happens when we are finished building. it is really important. this is the hardest question. you and i talked about this. what are the conversations that are ongoing? what arehe plans about how afghanistan, with their meager tmp, how do they afford what we are building them in the projects and his army we are building for them? it is difficult for me to figure out what happens to this ar when we leave? they cannot afford it. >> on your first point, i want you to know that if i am

confirmed, i really do want to work with youlosely with regard to the contacting issue and sustainability. i share your concerns. i know how that has developed. at the same time, we have not paid enough attention to that issue. i would like to work with you in trying to improve that aspect. with regard to the issue of afghanistan, i share your concern about where they are going to draw the resources they need to sustain the army and the police force and to be a untry, to be able t carry on their responsibilities. that will be the governance challenge we will face their, to ensure that as a nation, they will develop the revenues they need to govern the country. that will be part of it. otherwise, it will not work.

>> is there a plan in place for short-term and long-term? is there a plan that we will be contributing $13 billion to this year? what is the plan for four or five years from now? will we spent $5 billion or $6 billion per year? we are building them an army with a size and scope -- they have never had an army. this is new. is there planning going on that would indicateow this will look badears down the line in terms of what we have built -- like like four years down the line in terms of what we have built? >> let me get into that.

if i am confirmed, i would like to give you a better answer. >> thank you. the wartime contacting commission has done some great wo. it is like many other commissions. it is not getting enough attention. where it needs to be front and center will be under your purview. i hope you make sure your immediate stafis aware of its work and takes it to heart. we have a lot of lessons learned that we have never learned. it is really important as we try to do things with less money. the only other issue i would like to bring up today is getting your commitment and your comments about what needs to be done and should be done as it relates to problems of sexual

assault of men in the military. they have had difficulty accessing some sense of justice. >> we talked about that together in your office. i totally share your concerns. we have to have zero tolerance for any kind of sexual assaults in the military. we have to give the victims of sexual assault the ability to complain and have those complaints listen to and to be able to establish those cases. there are steps that need to be taken. i look forward to working with you and others in the department to make sure we protect women who have served so well in the military these days. >> thank you for your time here today. thank you for loving your country so much that you are willing to take on this important responsibility. thank you, mr. chairman. >> thank you, senator mccaskill.

>> mr. chairman, thank you. i think most americans would find it shocking that the department of defense is unable to produce accurate and complete information to support management decisions. as we also discussed, the law of the land requires the department of defense to be able to complete a clean audit by 2017. i think that would be shocking to most people. i appreciate your response on page 74 of the chances you submitted to our questions. you said achieving audits would be one of your top priorities. you have the capabilities to

complete that requirement of law. the marine corps is actually doing relatively good compared to other services in this area. they are experiencing a 3 to 1 return on every dollar they spend. they are getting a good return on that investment. it may be the attitude and the strong institutional resistance of the department of defense in believing their main job is to fight the nation's wars. we all know the budgetary pressures the department will be under as we deal with the unsustainable debt and these huge deficits. it is important to me an important to you to make financial management reform one of your important prioritie having said that, i would ask

you a straight up question. do you agree with secretary gates when he said the defense budget, and no matter how large it may be, it is not because of the country's fiscal woes? >> i agree with that. it is by no means the cause of the huge deficits we are encouraging. >> the question has requested a $671 billion budget for 2012. there is going to be room for the department to share in some of the budget and cuts that will be on the table. as you and i discussed, i hope this is not seen as an opportunity for those who want to whack the pentagon budget in a way that will impair the

ability of us to defend ourselves. i am sure you share that concern. >> yes, sir. >> you have the benefit of great experience. that also means you have a record i want to ask you about. you were president's clinton chief of staff and director of the omb before that. he played a role in the budgets and oversaw a 4% decline in fiscal year 1994. some have called that a fiscal holiday. others said we were catching a peace dividend. -- cashing a peace dividend. i want to give you an opportunity to explain your role in those cuts and whether you

think they were deeper than they should have been. give us the benefit of your perspective. i hope we do not try to cash a peace dividend in 2012 as we are engaged in two and half wars. >> as the director of omb, i was given the responsibility of the president to try to achieve significant savings as part of the economic plan that was adopted by the congres we reduced the deficit by almost $500 billion. i think that plus other agreements that were made in the bush administration and with the republican congress all contributeto our ability to achieve a balanced budget. with regard to the defense area, my responsibility as omb director was to provide a number to the defense secretary and

allow the defense secretary and those in the defense department to determine how best to achieve those savings. i understand that was part of what they proposed. looking at it in hindsight, it might not have been the best way to achieve those savings. it was a decision that was made at the defense department. >> turning to afghanistan, i know there is a lot of -- are a lo of favorable cments. you deserve credit for your part in taking down osama bin laden. congratulations to you and the president's national security team for that accomplishment. i get the sense that people were prematurely declaring that the fight is over because we have degraded al qaeda in afghanistan. i am glad toear you point out that they metastasized to other

parts of north africa and the region. i want to ask you in particular -- there are other groups that may not be asamiliar to .mericans as al qaeda - could you talk about the islamic jihadist groups that are out there and could easily more for -- easily morph into a threat as dangerous as al qaeda >> there are other groups out there. al qaeda is the one we are principally concerned aut because they attacked this country. they continue to attack this country. there are interlationships they have with other groups. there is a group that has relations with al qaeda.

they are conducting attacks in afghanistan. there is a group called ttp that has relationships with al qaeda that conducts a tax -- planned attacks against us and they have conducted al qaeda attacked as well. there is a group that conducts attacks largely in india. they have been known to discuss attacks elsewhere. if you move to the area of yemen, there is a man associated with al qaeda. he is computer oriented and does represent the potential to try to urge others in this country

to conduct attacked here. that is a concern. we have somalia, where el shabab operates in somalia. we have intelligence that indicates that they are looking at california -- looking at targets beyond somalia. if you look at has a lot and hamas -- hezbollah and hamas you will see that there are a lot of groups we have on our plate. >> the threat to american citizens extends beyond al qaeda. thank you for your answer. i look forward to working with you. >> thank you. senator gillibrand. >> thank you, mr. panetta, for your extraordinary service to

our country. i want to explore a little more on pakistan and go to a little bit of cyber warfare. chairman mullins stated that it is well known -- chairman mullen stated that it is well known that pakistan agree to go after the terrorist group. how do you judge pakistan's commitment to that effort? >> i think there is a simple test, which is whether or not they are continuing to go into afghanistan and attacking our forces. they have an influence over them, they could urge them to cease fire and stop those kinds

of attacks. >> i appreciate your testimony earlier about the nature of al qaeda and that it has metastasized. many believe a guy in the arabian peninsula is more dangerous. -- many believe al qaeda in the arabian peninsulis more dangerous. it works in a diffuse way. the greek terrorist attempts on our homeland since 9/11, one came out of pakistan and one k -- out of -- the >> i support your view that we have to take these threats head on and make them very much a part of our mission. i want to understand why, in yemen, our approach is so much different than afghanistan and

perhaps talk about what your long-term strategies are to deal with the fact that al-qaeda has changed so much. >> with regard to specific operations, i would have to do that in another forum. generally, our approachas been that because of these nodes that have developed, our approach has been to develop operations in each of these areas that will contain al-qaeda and go after them so they have no place to escape, so that we are doing that in yemen. it is obviously a dangerous and uncertain situation, but we continue to work with elements there to try to develop counter- terrorism. same thing is true for somia and with regards to aqim in north africa, we are working

with both the spanish and the french to develop approhes there that will contain them, as well. at the cia, we have tried to develop a more comprehensive strategy to kind of looked at all those nodes, look at all of those threats, and not just focus on pakistan. >> obviously, we do not know whether the government survives or not, but do we have strategies in place to make sure that if there is a transition, that we are very knowledgeable about what military assets are there, what will happen to them, and you have -- have you engaged the saudis or any other potential allies on what we can do there to protect against future growth of terrorism? >> with regards to specific operations, i really have to scuss that in another forum. as you know, it is a very uncertain situation.

it has been destabilized, and yet, we are continuing to work with those individuals in their government to try to go after aqap and we are continuing to receive operation from them. at this point in time, i would have to say that while it is obviously a scary answer -- scary situation, we continue our operations. >> lastly, if i still have me, mr. chairman, i appreciate the testimony about cyber terrorism, cyber attacks, cyber warfare. i appreciate the fact that the statement was made that a cyber attack could be a declaration of war. we had a chance to talk about this in some respect. can you share with us any of your vision, design, goals with regard to how we create a

greater platform for a cyber security and cyber defense? in particular, i have worked with senator hatch on creating international protocol to create alliances and working relationships with allies and non-allies on how to begin to have the ability to enforce laws against cyber attacks, a cyber criminal cyber terrorists and any other form of cyberiss chief. >> senator, as we discussed in your office, this is an area of great concern for me. i think -- what i have witnessed at the cia and elsewhere is that we are now the target of increasing attacks that go after our systems and it is extremely important for us to everything we can -- to do everything we can confront that threat. i have great resources at nsa

that has tremendous expertise and knowledge in this area. i would likeo develop it to be an even more effective force to be able to confront cyber terrorism and i would like to work with you on the effort to try to develop those kind of relationships, n only here but abroad, so that other countries could work with us in this effort. you know, we talk about nuclear. we talk about conventional warfare. we do not spend enough time talking about the threat of cyber war. >> thank you. last, i want to thank you for your testimony today about your priority to look out for the men and women serving in our armed services and your families. not only must that be one of your primary responsibilities, but i appreciate that is at the forefront of your mind. my time is expired. i hope you continue that focus and particularly focus on the issue of housing. issue of housing.