-- in mali. it is not like we are growing a piece to fit in -- a peace dividend. they had changed in some ways, but they're still great and require a very thoughtful and competence of response to protect the national security interest of this country. isthe same time, our budget a mess. hard to know how much money you're going have from year to year. i will disagree slightly with the chairman on the fact that somehow the president's budget is what is reflective of that challenge. sequestration. the president signed it. all free, house, senate, and the president, have to come together so that we can give not

just the department of defense but the entire government some to the house some idea month-to-month how much money they will have. your ability to plan is gone. we hope we will fix sequestration before it hits, we don't. now we're here in april wondering if it's going to continue into 2014. i don't think it's any one party is pulte. but all threelt, need to come together and recognize absented decision we're having a devastating impact on many parts of our government but certainly our national security which is supposed to be paramount. you cannot plan strategy when you do not know how much money will have month-to-month. i applaud the chairman for urging the reconciliation to come together and i look forward to finding a solution to that.

i look forward to hearing from the witnesses. thus challenging as all of this is, we will deal with it. we will make the decisions. we have certainly faced tougher times in the past and have come through it. it is a challenge that we will meet. i look for to hearing from witnesses today. thank you, mr. chair. >> mr. secretary. >> chairman, ranking member smith, members of the committee , thank you for this opportunity to discuss the president's fiscal year 2014 budget request for the department of defense. allow me to express my appreciation also to this committee for its continued support of our men and women in uniform and our entire civilian workforce. these people are doing tremendous work. there are making great sacrifices along with their families, as the have for more

than 11 years. 11 years our nation has been at war. whether they are fighting in afghanistan, patrolling the lanes of the sea, standing on the career and as a look, supplying troops, or supporting civil authority when disaster strikes, they are of advancing our nation's interests at home and abroad. this is the foundation of our military strength. as we discussed numbers, budgets, and strategic priorities, we will not lose sight of these men and women serving across the globe. as you all know so very well, their well-being depend on the decisions that we'll make here in washington. today, the department of defense faces the challenge of conducting long term planning and budgeting at a time of considerable uncertainty. both in terms of security challenges we face around world and the levels of defense

spending we can expect here at home. even as the military merges and recovers from more than one decade of sustained conflict in a iraq and afghanistan of, they have an array of risks and including the persistence of in the middleism east and north dr. koop. the proliferation of dangerous materials. the rise of new powers competing for influence. the rise of regional conflict which could rise in the united states. faceless, nameless, silent cyber attacks. the debilitating cursive human despair and poverty, as well as the uncertain implications of environmental degradation. meanwhile, the frenetic pace of change and the spread of advanced military technology to state and non-state actors posed a challenge to the military.

this is the strategic environment facing the defense department as it enters its third year of flat or declining budgets. the onset of these resource constraints of already led to significant an ongoing belt- tightening in the military. military modernization, force structure, and overhead expenditures. it has also given us an opportunity to reshape the military and reform defense institutions to better reflect 21st century realities as i outlined at my speech at the national defense university. it began under the leadership of secretary gates the cancelled or curtailed 30 modernization programs and trimmed across the defense enterprise. these efforts reduced the top line by $78 billion over a five- year time, as detailed in the fiscal year 2012 budget plan.

the realignment continued undersecretary panetta who worked closely with the president and the joint chiefs to craft new strategic guidance and a fiscal year 2013 budget plan which reduced the budget $487 billion or with the course of a decade. of president's request $526.60 billion for the department of defense's basin implement theto president's strategic guidance and enhances the department's efforts of institutional reform. most critically, it sustains the all-volunteer force and the care we provide our service members and their families dot which, again, as you know underpins everything that we do in this organization. the particulars of this request allow me to address the profound budget problems facing the department in fiscal year of3 and beyond as a result

the sequester. these challenges harlot significantly disrupted operations for the current fiscal year and greatly complicated efforts planned for the future. the congress and the department of defense have the responsibility and absolute obligation to work together to find these answers because we have come all of us, a shared responsibility, as the chairman and ranking member have noted, to protect our national security. we're going to need the help of this committee and congress to manage through this uncertainty. the appropriations bill enacted the needs of these urgent problems by allocating funding more closely in line with the president's budget request giving the department authority to start new programs and allowing us to proceed with important military cash portion projects. nonetheless, the bill still left

in place of deep and abrupt cuts associated with the sequester, as much as $41 billion in spending reductions, military pay and benefits exempt from the sequester, and we made a decision to shift to the impact of the sequester away from those serving in harm's way. that means the cuts fall heavily on dod operation's modernization, and accounts we used to train and equip those who will deploy in the future. furthermore, the military is experiencing higher operating tempos and higher costs than expected when it was formulated more than one year ago. are now facing a shortfall in operating and maintenance accounts for fiscal 2013 and at least $22 billion in the base budget for active forces. in response, the department has produced official travel, shot

back sharply on the facilities maintenance, imposed a hiring freezes, and halted many other important galore priority activities. important important, activities. however, this will require we continue to consider the furlough for civilian personnel. it will fall heavily on maintenance and training for the rerouting the readiness of the force that will be costly to regain in the future. i know general dempsey will address some of this in particular. as the service chiefs have said, we are consuming meanwhile they're not spare damage as we also take indiscriminate cuts across the areas of this budget. we will continue to need a strong partnership of this committee to help us address these shortfalls. but the sequester-related

provisions of the budget control act are not changed, fiscal 2014 funding for national defense programs will be subject we steeply reduced cap which would further cut funding by roughly $52 billion. and, if there is no action by the congress and the president, roughly $500 billion in reductions would be required over the next nine years. as an alternative, the president's budget proposes $150 billion in additional defense savings. these cuts are part of a cuts that aret of largely by colluded mainly in the years after fiscal year 2018 giving the department time to plan and implement wisely and responsibly. it is anchored by the defense strategic guidance. president's and $526.60

billion fiscal year 2014 request is supporting troops very much of a war in afghanistan cover protecting readiness, modernizing the aging weapons inventory in keeping with the president's strategic guidance, and sustaining the quality of the all-volunteer force. it also requests a place holder for overseas contingent operations, oco, at the fiscal year 2013 level. this does not include a former a formal request because they were delayed in order to provide commanders enough time to do such requirements. we will soon be submitting a budget amendment with a revised spending level and accountable detail. the following are the major components of the fiscal year 2014, $526.60 base budget

request. military pay and benefits including tricare and retirement 32% of$170 representing the total base budget. operating costs including $77.30 billion for civilian pay, total $180.10 billion resenting 34% of the total budget. acquisitions and other investments, procurement, research, development, testing, evaluation, new facilities construction, representing 33% of the budget at $176.30 billion. the budget presented today at its most basic level consists of a series of choices that reinforce each a the following complementary goals. use ofa more disciplined defense resources, this budget continues the department's approach over the last several

years to target growing costs in areas of support, acquisition of, pay, and benefits. this is before cutting capability and a core structure. in order to maintain readiness, we must be able to eliminate excess infrastructure as we ought to eliminate force structure. the judy has been shredding infrastructure a lawyer for several years and we are undertaking a review of our european footprint this year, but we also need to look at our domestic footprint. is clear 2014s budget is allowing for one line of brac which is a comprehensive and fair tool which allows communities to look property andhe provide we development assistance. it is imperfect. it is an imperfect process. .here are upfront costs

the future your defense program adds $2.40 billion to pay for those costs, but in the long term, there are significant savings. the previous five rounds are sitting $12 billion annually. those savings will continue. we're also taking other important steps to cut back on support costs and we will institute a study of our military treatment facilities including many hospitals and clinics that are currently underutilized. by the end of the year, we'll have a plan in place to suggest how to reduce the underutilization while still providing high-quality medical forces andl of our their families. this restructuring covered with brac other changes will allow us to plan for a cut in the civilian work force complying with congressional direction. we're also continuing successful

efforts to hold down military health costs with the proposed tricare benefit changes, the projected cost for 2014 as 4% lower than those costs in fiscal year 2012, a significant turnaround compared to health- care trends over the last decade. another important initiative is the effort to improve the financial management and achieve audible financial statements. i strongly support this initiative and i will do everything i can to fulfil the commitment and promises we have made to the congress and the american taxpayer. these and many other changes led to total savings of about $34 billion in fiscal year 2014-2018 including $5.50 billion in 2014. however, we are concerned these savings and a more disciplined use of resources could be eroded by sequester, as we're forced to make an efficient choices and drive up costs.

today, for example, we're forced to engage in shorter and less efficient contract and sharp cuts in units by side as that will increase the unit costs. in this budget, the department has achieved $8.20 billion in savings from weapons programs terminations and restructuring. by revising the acquisition structure for the ground combat vehicle, the department will save over $2 billion in development costs. in other cases, the department used evolutionary processes instead of relying on a leap ahead gains in technology. on defensehe impact procurement, the department is requesting an additional $36 million in support of the defense industry adjustment program. the department is continuing to take steps to tighten contract terms and reduce risks in the

largest acquisition program, the f 35 joint strike fighter. the budget request includes $8.40 billion for the joint strike fighter program. the cost of military pay and benefits is another significant a spending growth that must be addressed in the current fiscal environment. the department is submitting a new package of military compensation proposals to take into consideration congressional concerns addressed from fiscal year 2013. these changes save about $1.40 billion in 2014 and a total of $12.80 billion in 2014-2018. slowingludes a modest in the growth of military pay by implementing a 1% pay raise for service members in 2014. the department is seeking additional changes to the tricare program in 2014 to

bring beneficiary's cost share closer to the levels envisioned when the program was implemented, particularly for working-age retirees. today, military retirees contribute less than 11% of their total health-care costs compared to an average of 27% when tricare was first fully implemented in 1996. survivors of military members who died on active duty or medically retired members would be excluded from all tricare increases. evenfter the proposed increase in fees, tricare will remain, still come a substantial benefit. these adjustments to pay and benefit were among the most carefully considered and difficult choices in this budget. they were made with the strong support of the joint chiefs of staff and senior enlisted leadership in recognition that in order to sustain is important benefits over the long term

without dramatically reducing the size or readiness of the costs neede rising to be broader their control. spending reductions on the scale of the current drawdown cannot be implemented through just improving efficiency and and the lowering overhead. cost and changes to force structure and modernization programs also be required. the strategic guidance in january 2012 said the priorities and parameters to inform those choices and the fiscal year 2014 budget further implements budget alignment. the new strategy calls for a stronger and leaner force. last year, we propose reductions of about 100,000 in military strength between 2012- 2017. most of those reductions occur in ground forces and are consistent with the decision not to size forces to establish

prolong operations about maintaining adequate capability should activities began required. by the end of 2014, we will have completed two-thirds of the drawdown and should be fully complete by fiscal year 2017. increased emphasis on the asian pacific and middle least represents another key tenant of the defense strategic guidance. if they continue to put a premium on rapidly deployable, self sustaining forces, such as submarines, long-range bombers, carrier strikers that can project power over great distances and carry out a variety of missions as part of the balance to the asian pacific, we are expanding the marine corps presence in the region including rotational deployments of marine units to australia. we continue to develop a gorman s a strategic -- develop guam

as a strategic presence. we will stage the most capable forces in the region including a squadron of f-22's in japan. literal has deployed a combat ship to singapore and is increasing and more widely distributing in the western pacific. this new strategy not only recognizes the changing character of the conflicts in which the u.s. must prevail, but it leverages new concept of operation enabled by advances in space, cyberspace, special operations, global mobility, precision's strike, missile defense, and other capabilities. by making difficult trade-offs, the fiscal year 2014 budget protect or increases can investments in these critical capabilities. the high quality of our all- volunteer force continues to be

the foundation of our military strength. the budget request includes $137.10 billion for military personnel as well as $49.40 billion for military medical care. together, these make up roughly one-third of the base budget. this budget seeks to ensure that our troops receive the training and equipment they need for military readiness and a world class support programs day, and their families, have earned. however, as in other areas of the budget, the steep an abrupt cuts of the sequester will harm these programs. even with flat and declining , this is from a counterinsurgency a ready force to a force ready of operating across a full range of operations across the globe. the service budgets all fund initiatives to seek to full spectrum training for missions

beyond current operations in afghanistan. the department continues its work to quantify readiness activities as we seek to maximize our preparedness for real-world emissions. we do not yet know the costs of fixing the readiness of the force following the six months of sequester cuts to training in this fiscal year. therefore, these costs are not included in the fiscal year 2014 budget. budgetartment's submission makes it clear that people are central to everything that we do. sequester cuts would county many of these initiatives, especially for the civilian work force, they remain an important statement of the budget. we continue to support key programs to support service members and their families spending $8.50 billion on initiatives to include transition assistance and veterans employment assurance, behavioral health, family

readiness, suicide prevention, sexual assault prevention and response. the fiscal year 2014 budget is a reflection of the dod's best budget to match and is come always coming and means -- ends, ways, and means. it would address some of the structural costs in internal budget imbalances while implementing the president's defense strategic guidance in keeping faith with our men and women in uniform and their families. it is obvious that significant changes to the top line spending would require changes to this budget plan. the department must plan for any additional reductions to the defense budget that may result from congress and the administration agree and on a deficit reduction plan. it must be prepared in the event that sequester-level cut persist for another year or over the long term. as a result, i directed a

strategic choice and management review in order to assess the potential impact of further reductions up to the level of a full sequester. the purpose of this review is to reassess the basic assumptions that drive the department's investment and force structure decisions. the review will identify strategic choices and for the restitution all reforms that may be required including those reforms which should be pursued regardless of fiscal pressures. it is designed to help understand the challenges, articulate risk, and looked for opportunities and efficiencies presented by constraints. everything will be on the table during this review, roles in missions, planning, business practices, force structure, personnel and compensation, acquisition, modernization investment, how we operate, how we measure and maintain readiness. we have no choice.

it is being conducted by deputy secretary carter working with general dempsey. secretaries a of a service chiefs, office of the defense secretary principals and combat commanders are serving as central participants in this review. our aim is to include this review by may 31st. the results will inform our fiscal year 2015 budget request and will be the foundation for the quadrennial defense review due in february of next year. it is already clear to me that achieving significant and additional budget changes without risks and national security will require not just tweaking large shipping away at existing structure issues but, if necessary, rationing entirely new ones to better reflect the 21st century reality that will require the partnership of

congress. the f y 2014 budget and was before it have made our decisions. modest changes to restructure acquisition programs meeting fierce political resistance, and they were not implemented. we are now in a different fiscal environment in dealing with new realities that will force us to more fully confront these tough, painful choices and make the reforms we need to put this department on a path to sustain our military's strength for the 21st century. in order to do that, we need flexibility, time, and budget certainty. we will also need to fund the military capabilities necessary for the complex security threats of the 21st century. i believe the president's budget does that and with the partnership of the congress and the defense department, we can find ways to operate more

efficiently and effectively. multiple reviews and analyses show additional major cuts, on the scale and timeline of sequestration, would require core reductions for the scope of our activities from the world. at the executive and legislative branches of government, we have a shared responsibility to ensure that we protect our national security of american strategic interests. doing so requires we make every decision on the basis of enduring national interest and make sure that every policy is worthy of the service and sacrifice of our service members and their families. mr. chairman, thank you. >> think you, mr. secretary. general dempsey. >> distinguished members of the committee, i welcome this opportunity to update you on the united states armed forces and to comment on the budget proposal for fiscal year 2014.

comes at, this hearing a time of extraordinary uncertainty as resources decline come risks to national security are rising. it is in this context of how we can work together in a peerless joint force. our men and women in uniform are steadfast in their devotion to duty. i saw it recently in their eyes in afghanistan and when i have the honor of reenlisting 10 of them in bagram airfield. our forces are simultaneously fighting, transitioning, and redeploying. the afghan military will soon take operational lead for security across the country. as they gain confidence, so, too, did the afghan people. we transition to a sustainable presence beyond 2014. at every point along the way, we must make sure force levels match the mission. the joint force has been

vigilant elsewhere as well. we deter aggression and ensure our allies in the face of provocation, by both north korea and iran. we're working with our interagency partners to defend against cyber attacks. we're working towards a new normal in africa and the middle east. we want to keep the syrian conflict from destabilizing the region. we're ready with options military force is called for an withoutsecure interest making the situation worse. we must be ready for options for an uncertain and dangerous future. this was built to keep our nation immune from convergent. it aims to restore versatility to a more affordable joint force in support of our defense

strategy. however, let me be clear on what it does not do. this budget does not reflect full sequestration. and it givese less us more time. uncertainty persists about what the top line will be for this or any other budget. nor does this include funding to restore lost funding. we do not know how much it will take to recover from the readiness shortfalls we are expecting. we have already curtailed or cancel training for many and across all services, for those not preparing to deploy. we know from experience that it is more expensive to restore readiness than to keep it. recovery costs will compete now with the cost of building the joint force in the future. this budget does, however, invest in our priorities keeping the force in balance. upholds funding for emerging

capabilities, such as fiber. it funded the conventional and nuclear capabilities that are so critical and have proven capable in our defense. it lowers manpower costs, reduces excess infrastructure, and that makes health care more affordable. it is a real decisive advantage in our people. it treats being the best trained and the best equipped force as the non-negotiable imperative. never has tarnation sustained such a lengthy war solely through the service of an all- volunteer force. we must honor commitments to them and to their families. for many veterans, returning home is a new front line in the struggles of wounds seen and unseen. we must continue to invest in combat stress and traumatic brain injury. and share responsibility to address the urgent issue of suicide was the same devotion we

have shown protecting our soldiers, sailors, airmen and marines in combat. this must not include sexual assault that betrays the trust, the very trust, on which our profession is founded. every option to drive this crime from our ranks. this is a defining moment for the military. isr warrior's will to win unmatched. we have an opportunity, an obligation, with this and any future budget to restore confidence. we had it within us to stay strong as a global leader and as a reliable partner. the joint forces are looking to us to lead through this period of historical fiscal correction, but we cannot do it alone, as i have said before, and the secretary just said.

we need budget certainty, time, and flexibility. this means the time to deliberately evaluate tradeoffs in force structure, modernization, readiness and it means the full flexibility to keep the force in balance. thank you for all you have done to support our men and women in uniform. i only ask that you continue to irresponsible investment and i look forward to your questions. >> thank you very much. anyink we will not have votes on the floor before 1:00. it is my intention to get in as many questions as we can, but to take a brief break at around noon. critical aspects of the transition in afghanistan and negotiation of the bilateral security agreement with the government of afghanistan, i'm concerned with the progress in

these negotiations and the failure to reach an agreement that will put at risk of vital national security interests in afghanistan and the region. this will create a vacuum that regional state and non-state actors to abuse. we would be a willing partner and president karzai's public statements have been erratic, at best. a bad agreement is worse than no agreement, but i'm convinced that not only is an agreement imperative, but we need to secure it this spring to allow our nato allies time to agreementsimilar with the strongest signal possible that we will not abandon afghanistan. i was there not too long ago. everyone in afghanistan is asking, when are you leaving? we need to counter the

telegram's narrative and reversed the crisis of confidence i have seen in afghan partners resulting from our accelerated redeployment and ambiguity about the residual force. to that end, i strongly believe that an announcement about are residual force, or at least an announcement of a narrow range two levels is necessary in getting a bilateral service agreement. in iraq, we did not come up with a number sufficient that the iraqi leadership would expand the political capital to do what is necessary to make an agreement possible. by sitting on the announcement, all parties with a stake in the outcome, and neighbors, allies, members of congress, they will be reluctant to spend the political capital necessary. the politics becomes a vivid and

more complicated as it gets caught up in the afghan and presidential election and campaigns for the midterm congressional elections arrive. karzai will only become more challenging to deal with as his term comes to an end. these will become a self- fulfilling prophecies. nevertheless, chairman down sikkimese data this week that panning down force levels is not . matter of urgency >> let me align myself with your assessment that it is confidence in the

center of gravity that will allow this mission to succeed and indoor. secondly, let me align myself with your suggestion that bilateral security of agreements should be achieved as soon as possible. the reason i said it was not important to nail down the exact number is that we already have a nato mission in which we are the lead, clearly, but we are a part of the nato mission. nato has declared that the range of trainers, advisers posted 2014 will be between 8000- 12,000. i think we can go with the bilateral support agreement on that basis because it should inform the number of bases we might need to retain and what authorities we might need. there are also some of physics involved. weevil be of $34 and in the middle of february.

toget burned 34,000 down 2014,2,000 to the end of we can do the math. tactically, i do not need the exact number because i have a range available to me and i know what it takes to retrogradine down. i know when i spoke to general allan and when i spoke to general done founford, they d talked about an additional 6,000 nato troops allowign advisors down to the batallion level. even if we did, but they ran as they feel comfortable with in the negotiations, i think that

would be helpful. you want your military to do? another $1ive you out of the budget. that we and testify more cuts, we would have to go back and adjust our strategy. that is what secretary asked for, i believe, a few weeks ago. the strategy would have had to build the world is not getting a more stable. nonetheless, the president has suggested taking an additional

$120 billion depending on how you measure the cut. he offers no proposal to rectify the $53 billion in fiscal year to thousand 15. did the dod conduct an analysis-- in fiscal year 2015. if not, who proposed it? did omb or the white house ask for the analysis? what commissions have recommended we eliminate? what changes to last year strategy will you endorse? of budgets, and i think you know this as painfully about ae, as they take year to prepare. we have been working on this for one year. sequestration kicked in on march 1st. they do not have an effect on

this five-year defense plan we have submitted. this is why the secretary of defense has taken us on the path towards a strategic review. as billetica not only the president's budget proposal but full sequestration, we have to understand what it will do to the force. most of those cuts are back loaded. about $6 billion or so in 2014, but that is the reason i can state with confidence as before. i want to drill down on the budget question just a bit. frequently we act like if you cut one penny on defense that it

is unsustainable and security falls completely apart. that's obviously ridiculous. the problem we have right now is sequestration. it is across the world -- board, deep, mindless. the problems described in your testimony are being caused by snappedation and by the changer have to make on existing budgets. the best thing we can do is to stop sequestration as soon as possible. it is the classic gift that keeps on giving. 2016.4, 2015, if you looked at the cuts in the president's budget, 2017 and beyond, roughly $119 billion,

but the other problem we have is other places we can cut that will not affect security that congress stops you from doing. i want to explore two of those. personnel costs and base closures. mentioned thel tricare share has gone from 27% to 11%. there are areas to find savings. 't it true that doesn affect the plans? if you're going to give us less, tell us what less. we have seen dramatic improveme

nts in acquisition programs. not one more penny can come out of defense, that is dead wrong. it is just a matter of efficiency. forget them have a deficit that's eating us alive, a massive deficit in infrastructure in this country. the implication for taxes, on down on. these will help the budget pictures. just to c talk a little tbrac fee,s,t brac, tricare whichever of you wants to take a stab at it. >> i'll respond and then i'll ask general dempsey. you mentioned the comptroller. he may want to respond as well. let me address the larger

question in the context. fact, we are basing the welity that we are facing, are going have to plan, and just come review, and take a pretty hard look at everything. riding the chairman's comments in his testimony matching resources with the mission, is a particularly important comment. we cannot put our military and all of those who support our military it in a position where they are under resources, and byn there's an expectation the people of this country than they are secure and we are guaranteeing their security.

as the chairman and mr. smith noted in your comments, it is the highest order, the highest for the possibility of a government, the security of a nation. require someo tough choices across the board. inenerally hit some of those my testimony. brac is an area that we do have to look out, i believe, but there is not one answer. there is everything, every component of the budget including tricare, compensation, budgets. don't have to engage in this body can of this progress, on the issue of social security. i doubt if there are many people in this country who do not understand that unless we do something that actually, it is not sustainable. it is the same in the military.

we have to manage this, but we have to also protect as well as we can with our strategic priorities and our national interests. how'd we do this. -- how do we do this? the reality of sequestration is that it is not theory. it is law. the congress passed, the president sign the budget act. >> i would be remiss if i did taxesint out that we cut for $7 trillino in the face of the baby boomers retiring and this war. straightforwarda question? can money be cut over the next 10 years that will not negatively impact our ability to protect national security?

but my answer is that it is going to be cut. >> i am getting at the larger point here. when you make those cuts coming here from the other side that we had this strategy coming to cut the money and that is -- forgive me, ridiculous. clearly we can cut money that would not jeopardize national security. i'm wondering if you agree. >> as you said in your opening comments, i don't know of an institution that cannot find some somewhere. back to an important point that general dempsey made dummy deal with this every day for the department of defense what our parties are. what do you expect? what does the american people expect those people to do? how are we going to resource those?

this is where you have to start. you can find savings. they have done a very good job finding the savings, acquisitions, and others. yes, it's possible, but we do not have a choice. >> that more or less answers the question. if you have something else, that the great. -- that would be great. >> we're still trying to figure of where to find $487 billion. this does not start from a stable platform. even with the sequestration, this would not be the deepest cut the military has ephors butered -- ever suffered, ins by far the steepest. needs to be taken in the context of what we're facing now. what would these cuts do before they are imposed? >> make no mistake.

sequestration and the drop-off is ridiculous. when you put together a 10-year plan, you can find savings, i do believe. you have done an admirable job. i yield back. thank you, mr. chairman. savingsnk we can find of across government. the point is that we have taken a 50% of the savings out of defense when it is only 18% of the savings. i think we need to be more rational in the whole approach. thank you, mr. chairman. mr. secretary, in your speech at aboutst weekend talking strategic choices and management review you said, "the goal is not to assume more tactically except that the cuts, such as those imposed by the sequester, will endure." then in the next paragraph you said it is also about matching missions with resources.

we'll have a longstanding discussion on this committee about what comes first. you have a dollar amount and then figure out what they can do with? are you figure out what it takes to defend the country and then talk about what resources are required to do that mission? as you know, there is a widespread view that you were brought into the pentagon to cut defense. who werehe people concerned about that are pointing to the fact that the cost assessment and program evaluation people are playing a key role in this strategic review. they're one of the green eyeshade people. on a broader level, it seems to me, more than anyone else in the government, the secretary of defense have to be the one who says this is what it takes to

defend the country and to fight for that, publicly but also internally in the administration. i guess i would just be interested in how you see your role. is it to manage the decline? or is it to be explicit but the dangers in the world and what it takes? and that of the more political part of the government, congress and the president, have to accept the consequences of the decision. >> congressman, thank you. first, have been in this job six weeks. beforeuts occurred long i ever got here. much to doink i had with the cuts to defense spending. as the responsibilities, you some thatd accurately

i leave it and preside over the want institution in this country charged with only one mission, the security of this country. i have no other job. i work with the congress as an .gent part of my job is to make sure that the department of defense is managed effectively within the laws but the congress passes in the directives that congress gives us. also, my role is to be an advocate for our men and women in uniform and the jobs that we do. a have done that. i intend to do that. i do not think i take a back seat to anyone. the get my entire life, my career. i have not done now as much as most of you in the congress here, or certainly as much as

general dempsey has dawned, -- has done, but i have devoted my entire life to people in the military. , but i alsocate have to be realistic, congressmen, in what we're dealing with sequestration is the law. it is not debatable for me. this is what is on the books now. the house and senate budget thatution as were passed are pretty closed with the president's budget is. now, i have to deal with that reality. i have to manage and lead with that reality. the last point about accepting

these kinds of things, as you noted in the ndu, whether i accepted or not is one thing. we do not want to accept it. we're up here explaining in our testimony and in interviews i sequestration in some specificity is doing and , but intinue to do cannot leave my institution into a swamp of the night fighting -- knife fighting over what's already in place. i think the general has made it clear in his testimony. i think i did if you want to go deeper and to many programs with the comptroller about how difficult this is going to be. it is a combination of everything you have said, the way i see my job.

the president did not instruct me many asked me to consider doing this job and many asked me to do this job, to go over and cut the heart out of the pentagon. thank you. thank you. ms. sanchez. >> thank you for being before us today. there are many of us in the room when secretary gates was before us and you spoke about how the u.s. debt and deficit was one of the biggest concerns with respect to national security. what so manyto do across america is b-- believes is correct. i believe everyone needs to put something on the table, entitlements, defense,

discretionary programs that so many people like to cut all the time. the congress, because supercommittee was not able to come up with a list of cuts, .his is where we are i do not think you were brought in to cut defense. i think you're brought in to try to best advise us if we need to change course of action, how to doing, and why. my question to you today, i might add that in the 17 years i our been on this committee, defense budget was about been little bit under $300 billion per year. , ite went into two wars rose to about $800 billion per

year. i do not think there has been a single department to has seen that. we're getting out of the second war and we're coming back. i think there are cuts to be made. secretary come over the next five years when i looked at this budget, there is a transfer of theions of dollars to cover cost of escalation in existing programs and increasing requirement. as you know, i sat as a ranking member on strategic forces subcommittee so we look at this quite a bit. increased over a sign that they're doing with wrote -- with respect to the but i wonder why we see raises in the nuclear program and i see nothing with respect to nuclear non-proliferation programs. that would be my first question to you. 14second one is about the

ground-based interceptors in alaska. as we move to do this, of the department of defense move to do the department's commitment to make sure that the interceptors are successfully operational and realistically tested before we deploy them since gbi's had not been successfully flight tested since 2008? >> thank you. the ground-nd to based interceptors question. when i made the announcement gbirding increasing our 30 inventory to 44, and as you new ones will be

located at fort greely and vandenberg. did have at we problem in one of the last tests with the guidance system. question ifsked the you would put the new interceptors in, still with some uncertainty, but until that problem was resolved, i said no. testing, we will continue to test, and we will not employ any new interceptors anywhere until we are completely satisfied that they are operational and we have complete confidence in their ability. as to the non-proliferation does not have responsibility for funding non- proliferation programs. our responsibility is funding

and maintaining, securing the nuclear stockpile. we will continue to do that. the non-proliferation programs which we work with state on specifically, also energy, and we participated that process, but the funding doesn't come from dod. miss thet want to opportunity to point out that although iraq and afghanistan the world weown, are inheriting here is far less stable than the one that existed when you entered the congress of the united states. i would ask you not to make any direct correlation between the end of the conflict in afghanistan and where you think our budget should end up. >> and to clarify the record so people don't think we have had a budget of $800 billion a year

for the past 10 years, we had one budget over $700 billion. >> thank you. it's good to see you again, general dempsey. mr. secretary, you were saying in your comments what the american people want. what they want is a smart, efficient foreign policy. i don't think we have had a foreign policy that's made a helluva lot of sense going back to george bush. not being critical of the president, but general dempsey, i taught to the inspector general for reconstruction two days ago. and yet we continue to spend money in those countries. today, i had jake gardner in my office for an hour-and-a-half. he is of the firm belief that the next year to three years, there will be a civil war in iraq. secretary, that you

and general dempsey, how can america continue to police the world, keep all of these bases overseas open, and that i hear you in your testimony, and i agree, we are in a financial collapse. i saw an army corporal on tuesday of this week for my district who has lost a leg, three fingers, and brain injury. he has a wife and four children. he lives in north carolina and i don't know -- somebody has to wake up this country. yes, we have to have a strong military. strong buthave a that, but they deserve better than what they get from an administration and congress that wants to send abroad a world and change the culture of countries that could care less about freedom. if they are a threat to us, i will vote every time to make sure we defend the american

people. but i hope, mr. secretary, that you will be a leader with this had a say walk carefully and make sure it is we failed inause iraq. was never justified. i hope that you bring it to work through these problems, and my friends on both sides certainly articulated and have agreed, but how in the world can we continue to play the game? --ave this analogy recently everybody in my neighborhood knows i'm broke. i still drive a fancy car. i call my neighbors and to let me take you to dinner. and they say what a fool. he can't even pay his bill that he wants to take me to dinner? somebody has got to bring some sanity to this program and rebuild the military and i will support you and your leadership

to make it more efficient and streamlined. changeain, we need to the way we get involved with these four wars with no end to it. if you want to comment on that, you don't have to, but if you want to, i appreciate it. >> thank you. good to see you again. theand i have had over years many conversations about this issue. i am grateful that you over many years, in difficult situations, have spoken up and made clear your thoughts on what you just talked about and other issues. i would respond this way very briefly -- if you recall the last sentence of my testimony, the last sentence of my testimony was any decision we ofe should always be worthy

the service and sacrifices of our men and women and their families. i believe that. i will do that as secretary of defense. the day i think that is not being done, i will do everything i can to make sure it is done. but if that day would ever come, i would have to resign because it is the essence of who we are as americans. we are bigger point, all in this country, certainly those responsible for foreign policy and our national security and the connecting dynamics that flow into it, our economics, and as they analyze what

we went through the last 12 years, and i'm not here to importantt, but it is that we review what we did, why we did it, where we are, and we have some new opportunities here to restructure and take that review and hopefully put america may be on a path where andan do more with allies it is central to everything we do. that comment i made in my testimony, general dempsey noted it. it's not all bad sometimes to have these situations when each of us and our personal lives or government lives are confronted with the uncontrollable things coming down on us because it forces us to take stock of what we're doing and why we're doing it. that is essentially what is going on.

there is an opportunity. i wish you'd come in a different way. but it is what it is. we have to be smart how we use this opportunity to restructure and rethink. foreign policy guides everything because it's our national interest. i know that is not the purview of this committee, but you are not disconnected from it. nor are we. i serve on the president paused national security team. there is no discussion the general has with the president or that i have that does not include all of these parts. what you're saying and i appreciate your comments. >> thank you. thank you to each of you for your service to our country. i have just 3 questions and if you could just answer that yes or no. f-35possible delays in the

procurement, do you believe the navy and air force have budgeted sufficient funds to maintain the necessary strike fighter inventory to meet the national military requirements? >> yes, i do. to the national guard, in your opinion, given the restrained budget atmosphere we are in, can we continue to adequately resource have to quit the national guard and reserve component as an operational force or do you feel you will be in a position where you have to revert back to the strategic reserve model? >> i think the national guard and reserves are key components of our military force structure and will continue to be. that has become quite obvious in the last few years. without going into a long oration on this, and marty dempsey can handle it, i don't

think we can have the projected force structure we have now counting on the assets we have and adequately managing those assets. without a strong national guard and reserves. if for no other reason than the professional is asian -- that hasnalization occurred in our guard units in the last 12 years. we have a member of the joint chiefs of staff who is a national guard representative. that tells you something. i am a strong supporter of our national guard and reserves. my third question is in two parts, but to the extent you can clarify the need to -- to north korea and iran possesses the capability to reach the united

states with long-range missiles? with a conventional warhead or with a wmd warhead? >> of want to be careful with this answer because it might be up to some intelligence year, but i don't believe either of those countries has that capacity right now. havethat mean they won't it or can't have it or are not working on it? no. that's why this is a very dangerous situation. add and i would ask general dempsey for his thoughts, this company is capable of dealing with any threat and an action by any country, including iran or north korea. >> i have nothing to add. no to bothwer is

questions? they did not possess the capability to reach the u.s. with a conventional warhead or wmd warhead? >> yes, but we have to be mindful of uncertainty of any what youan't accept are never sure of. right now: i don't think we believe they have that capacity but i qualify that answer as i did. you, mr. chairman. mr. chairman. mr. secretary, i'm going to duplicate the request from my good friend from north carolina as the be as a sink as possible. i believe the impact of this administration pause this will cuts to our national security are unwise and will have long- lasting repercussions. but i also believe this

administration's attack on the face, religious freedom and religious liberty and our military are unwise and will have long-lasting repercussions. from the pentagon, we had an order issued that you do not have a copy of, but i'm sure you are familiar with -- our commanders can no longer even for those under his or her command of approved programs in the chaplain's office. in addition, we have an order from the pentagon where a patch from the air force had to be removed and we were told that it was because of the legal department had said you could not use got even if it was in a non-religious context. we have your approval given by the assistant secretary of defense to allow individuals to march in uniform in a san diego gay pride parade which was a political parade, using their uniform it. then we have an order from the department of a deeper debate

bibles from being used at walter reed hospital. these are just a few of the items, because i only have five minutes. as i'm sure you are familiar recently, we have had a training program which i have given you a copy of where we list evangelicalism -- evangelical christians, catholics, and mormons as the same category of religious extremas them as we do al qaeda. i don't expect you to know all of those things are keep your hands of all of them, but because of those, we have a provision put in the national defense authorization act last the, section 533, for protection of the rights and conscience of the armed forces and chaplains. it's as our service people could not have their beliefs on the basis -- they could not have any assignmentsonal based on their religious beliefs. it's as our chaplains, no member

of the armed forces could require chaplains to perform any right coverage will force our money contrary to the conscience, moral principles or beliefs of the chaplain or discriminate or take any action against the chaplet including to route --omotion to comply with the requirement. my question is -- this is a big issue. we get statement after statement sent to us almost on a weekly basis about these issues. 75% of the house and 85% of the senate who voted for that authorization bill with that provision because they thought was necessary. do you believe that those rights and provisions of section 533 are necessary and will advise? about alli don't know

the specifics of the information you presented. will find out about it and i will get back to you. second, obviously we will ndaay with all of the directive spirit protection of religious rights is fundamental to this country. >> my time is running out. my only question is do you think that provision is a necessary provision that will advise? >> it is in the ndaa. >> do you feel it was necessary and will advise? >> i haven't seen it. >> i will try to follow up. let me just ask you to come back to me and let me know the status of the regulations that are supposed to be passed to ensure that is done.

i take it you are not aware of those today? >> unless i had it in a friend of me, i don't know. i'm well aware of the directives -- >> the final thing i would ask in the last 20 seconds i have is i can't understand why the department is issuing orders prohibiting people in the chain of command from talking about chaplain's programs supporting phase, but they're not robbing people and a chain of command for making anti-faced statements and giving anti-based training. faith statements. >> that should not be happening and i can say that without seeing anything. i will get back to you and find out about it. thank you. you, mr. secretary general, thank you for your service to our country and please convey to the men and women you represent how proud we

are of them and the great job they do for our country every day. it is my understanding that because of sequestration, that nine fighter squadrons and three bomber squadrons have been grounded. is that correct? >> i think nine is the accurate number. >> if congress were able to reach an agreement where we could swap out the sequester cuts for some other "-- the other cuts in various parts of the budget and perhaps have some revenue in there as well, if the sequester were not in effect today, with the planes be flying? >> i assume that they would be, yes. >> what are the consequences both in terms of readiness and in terms of our technical capability of those airplanes stop flying? >> fundamentally, we are meeting near-term requirements

at the expense of downstream ready s. basketball season just ended. downstream readiness. them together as a team and scrimmage. eventually get into the season. what we're doing now is we're not scrimmaging and we're limiting the number of collective trills and focusing on individual skills because that's where the budget situation has taken us. they won't be ready to play. >> if the congress doesn't reach the kind of agreement i just talked about and we have a second year or the first full year of sequestration, what kind of other changes which you have to make in the defense posture of the country? >> we will have to continue to effectively cut into our readiness and the grounding of wings is a good example of that.

we are doing the same thing in the navy. not sailing. some of our ships remain at dock. so it is across the board. it's not just one service. >> in the president's budget proposal, he does propose the replacement of sequestration. he also suggests there would be $150 billion in cuts to defense, not the 550 billion we have had otherwise. what kinds of things which you do to hit the 150 billion guard -- $150 billion target in the president's budget? the reasons i of directed the strategic priorities and management review. to ask those kinds of questions of our cheese and combatant commanders and other leaders in

the defense department. what are those options? that's first. if you just look at the numbers, $550 billion over 10 years verses $150 billion over 10 years, i know what side i will take on that if i'm looking for resources for our department. the other part of that is the president's $150 billion in savings through the department of defense comes mostly at the back end of that 10 years. >> so there would be time to transition? >> that's exactly right. it gives us time as the general noted, time, flexibility of certainty. >> i don't mean this as a rhetorical question. i mean it as a real question. my assumption is we will have significantly fewer troops in afghanistan audit september 30 13, right?mber 30 of

>> yes. we are continuing to draw down. >> why is the overseas account theest $87.2 billion for present fiscal year and $88.5 billion for the 14 fiscal year? if we're having that size drawdown, why is that not reflected in the reduction in the request? >> it is a place holder. as i said in my testimony, we have not sent a budget up yet. we will be doing that shortly. a placeou refer to as holder, knowing we will be coming back with something probably in that range. lower ifuldn't it be the number of troops is significantly lower? >> because we have to bring about in large numbers. that means equipment. we have billions of dollars in equipment in afghanistan that we need to get out and it's very dangerous. we'll have two ways out. other than fly everything out,

that's prohibited. we're flying things out now. the southern route down through pakistan and out through the karachi port. you know what's happening in pakistan. >> i do. >> up to the north, bad roads, different countries, variables -- that expense of just getting our troops out on a timely basis and the material that goes with it is costing us a lot of money. >> thank you. thank you, mr. chairman. >> we have been chewing up the equipment for 10 years and there's no reset which we are going to be facing. >> thank you for being here today. i was happy to join with nearly 50 of my colleagues, bipartisan, a unique situation of bipartisan concern. defensertment of creating a distinguished warfare

battle, which we appreciate to recognize the extraordinary service of our personnel. issuer chile, there is an wasrecedents and the dwn placed above the bronze star and purple heart. this is of great concern to veterans and military families. >> thank you. it is a concern to me and a concern to anybody in the military or any veteran. but to get straight to the answer, you know i asked the chiefs and the secretaries to go back and take another look. i will make a decision on this early next week and i will make that announcement on where i take we should go next on that. >> as a fellow veteran, i appreciate you looking into that. it is important. additionally, in regard to the military health-care system, there is a proposal increase for

try care fees to begin. , andefense health program the last two years, there has been a surplus of $709 million. there has been a surplus and additionally, it has been claimed the health care costs are eating the budget alive when in fact, is an increase of less than 1% in fiscal year 13 at 14. there has actually been a decrease of $650 million in private-sector cost. is ancern is we know this great program. people are very satisfied. military families appreciate this benefit. commitments have been made to our veterans and military families. why would we be increasing the fees with the program is working well? >> thank you. theprogram is what --

program is working well and as i we have my testimony, seen as costs go down, and i mentioned this in my testimony. as more and more people, and to that system and more demand and sustainability we have to look at how we're going to continue to commit and pay for those that befell those commitments, as we have analyzed this in some detail, we think it would be wise -- these are not significant increases, by the way, but it would be wise to in fees,hese increases recognizing this is the beginning of debate as it should be laid out and let's look at everything on this issue.

significantt increases. we're looking at long-term sustainability. it's a good program. it has worked. it is the issue of the affordability of the program. there's about a billion dollars worth of savings associated with it the fiscal 14 budget. if we don't do it, we would have to take it out of readiness or modernization. i think there's a strong feeling with the secretary and joint chiefs -- theould you speak more into microphones? >> we save about a billion dollars from the tri care fees and copays. if we don't do it, we have to take at of readiness and modernization. there's a strong feeling from the secretary, cheese and chairman at the right thing to do is a balanced approach to meeting our defense needs. >> but the experience is very

clear -- there are not increases of any significant about -- less than 1%. have been a --es i'm not sure with the new windstar, an increase of 365% -- and not sure what the new ones are. know it was not projected that the health care costs would go down. that was a pleasant surprise. i would rather that we look at the pleasant surprise and be positive. i hope you wouldn't look at the fee increases to -- do impact military families. i appreciate your time. >> thank you, mr. chairman and mr. secretary. i look forward to working to you -- to working with you. secretary hagel, understand the department of the defense has restarted tuition assistance as of april might.

tuition assistance and very much support education for our troops, continuing education, yet i understand this is going to put some pressure on our services to try to go along with this because it means in many cases they have spent some of those dollars and they will have to look for other areas in which to backfill those dollars as well. could comment on that. a lesson for all of on record we go supporting a change when it comes about. certainly when we look at the budget, the pentagon requests one thing and we do something different. mr.understand that

secretary. how are we doing with that right now and is this not a problem for the services because they have to find the dollars to fund not just an unlimited amount of assistance going forward from this point. >> thank you. let me respond that i'm going to specifichairman for a response because you noted in your question some of the services are struggling with this more than others. first, we are following the thector and what appropriations bill instructed us to do. you are correct that prior to that, we had to make some tough choices on where they were going to prioritize their funds. as i noted in my comments, readiness, protecting the war moster, where are

important assignments are, when you are at war in the nation, those are priorities. we had to balance those priorities with those resources. the services were in a tough spot on this. each service has a different standard. to fulfill their commitment, but let me asked the chairman. wheres important to know those dollars are coming from. >> thank you. it goes back to what congressman wilson talked about. i find myself in the difficult position of standing in front of soldiers, sailors, airmen and as we look to absorber cuts of whenever magnitude, we have to include all of the various factors of this giant enterprise in order to keep the force in balance.

might be on my blog complaining about the fact we've had to suspend tuition assistance or revise the program, but that answer is unless we look across the board at all the levers we have to pull, whether it's infrastructure, health care, pay compensation, tuition assistance, we will have an extraordinarily well compensated force that will be sitting at fort hood taxes or camp lejeune unable to train. we will be putting them at risk. i tell young men and women if this is an inconvenience, what would be dangerous is if we don't keep this thing at equilibrium. we have to look at everything. >> i think my concern is whether or not we are cutting into a, cutting into ready this by having an unlimited stream of money. something we would all support -- >> the answer is yes but not uniquely because of tuition

assistance. tuition assistance was about $200 million for the rest of this fiscal year which may sound like an inconsequential amount $525ney in the context of billion budget, but it's probably three or four brigade training exercises in california. >> did you want to comment on that? >> i think the secretary and chairman said it right. we are complying with what we thought was the intent of the law and it is causing some difficult decisions. >> thank you. >> thank you. mr. bishop. >> thank you, mr. chairman. 'fter congressman forbes question, it's good to have the on the correct side of capitol hill.

i have about five questions and i'm going to get them through come hell or high water. the first one comes from a requested your budget. appears that roughly $1.4 million is put in there to conduct an environmental impact study regarding the icbm missile wing. a i understand this was inserted by your office and not by that of air force leadership. three questions dealing with this -- is that a correct statement? no. 2, was the object of the effort? number three, if it is to close down and icbm we were a squadron, which one is being studied for potential closure? i ask the comptroller first of all is that a correct statement. and what that was about. i'm going to ask him to answer the question because it is correct and what he reminded me of was the missile wing is a component of the larger context.

let me ask him -- >> i don't remember who put it in. we are studying all three wings and -- >> what is the purpose for the effort? >> all missions and activities are on the table. we need to understand the environmental impact would be regarding icbm. wings're dealing with all and squadrons? >> yes. >> the next question goes to the faa's actions recently. they closed a number of contract hours, far in excess of what they needed to meet their sequestration goal. a few of those are mere air force bases. airve one at ogden hinckley force base. congressman hinckley has won an barksdale. number one, did the faa contacted defense department in any way to coordinate what they were doing when they made the decision to close these towers

down? ahead and answer that one. >> i don't know. >> if you could find out -- >> we will find out and get back to you. >> in the past, when they decided to change it, and had a negative impact on what it cost to do missile defense and there had been no coordination between those two agencies. i would like to know if there has been any contact. since these areas overlap as far as air space, the collision potential and pilot safety and potential impact on mission readiness or training, testing activity, do you consider this to be a problem in these few situations and if so, what are you doing about it? >> i understand exactly your point. the reasons you mentioned -- as i said, i will bind out and get

better acquainted with it. it seems to me based on what he said, it could be a potential problem. beyond that, i would have to find out. starting with your question, did they contact us, what did we say, what are the vulnerabilities? i will get back to you. towers andt of bases, but there are a couple of which i know. i would appreciate that kind of return and i will give you back a minute. this is one of the few times i haven't used it all. >> i just used it all. >> thank you for your comments. a careery started after of vietnam on this side of the capital in 1971 as chief of staff to a congressman. >> why did you go over to the

dark side? >> i'm still going to confession. >> thank you. have time, you could ask a question about why we don't do environmental impact on the result of somebody hitting us with a missile. >> thank you. i want to thank you all for appearing today. in particular, i would like to congratulate you on your confirmation. i look forward to working with you as we navigate some very challenging times. i would like to try to get in to questions -- one on cyber and one that directed at energy. let me start with secretary hagel. in your first foreign-policy address on april 3, you

asserted the cyber threat our nation faces today is a security challenge with potential adversaries seeking the ability to strike at american infrastructure. i spent quite a bit of time on this. it is a particular interest of mine, dealing with cyberspace and how we better protect the nation. budget, are we resources to adequately to operate within the cyber domain and ensure our national therests and does department require additional authority to educate, tracked, and retain the very best cyber operators? appreciateu and i your comments. the cyber is one of the areas where we have proposed increases in the budget.

that begins with some understanding at least on our side of the threats and responsibilities we have in this domain. they are going to continue to multiplied. i do know of your longstanding involvement in this area and i look forward to working with you. we continue to enhance our role in this effort. we are not the only agency that has some responsibility here. the department of homeland security has a lot of authority on this. we're working closely on injured-agency groups as we connect better and be need more ofthat connection online authority, definitions of responsibility. as you know, our to primary nsa and cyber command.

they are critical components of our command and we are going to continue to spend a lot of time on it. it is overall as big a threat to this country as anyone threat. >> thank you. to the issue of energy and may be free of time will come back to cyber. i would like to congratulate the navy. they just completed a successful test of a shipboard laser that shot down a drone. i see this as game changing technology. both for hour standoff as well , ballistic defense missile defense. about a year-and-a-half ago, the center of strategic assessment came out the report that said the directive energy is maturing

at a faster pace than anyone realized. can you tell me where you stand on getting this out of the lab and with practical blowing this type of technology? >> yes. noted, we have a high priority on this. recited a couple of examples. we have a platform ship involved in some of this testing right now. we will continue to be very and we and the engaged will ensure the prioritization of the resources we need to continue to carry it out. let me touch on a couple of operational aspects of anti- access and area denial environment. be a it's likely to premium against technology and

competency in the asia-pacific region where there's a proliferation of submarines and advanced tactical fighters and ballistic missiles and electronic warfare challenges. general dempsey, can you speak to how the resources and trading and investing in research and development in order to meet those challenges with regards to directed energy, undersea warfare, and that fast warfare? >> -- and advanced techniques -- >> the gentleman's time has expired. you could submit that to the record. -- thank you for being here. we appreciate the dialogue today. i want to start by thanking both of you to looking into sexual assault and the military. general dempsey, you have had exemplary dedication to this issue and we appreciate your voice as we try to change the

culture at look at the rules and regulations. thank you for your position on addressing article 60 after we had the incident of general franklin overturning a conviction of sexual assault. of the sexual but basalt conference and myself recently received a presentation from the air force and we appreciate their dedication on this issue. we look forward to working with you on the language because there are a number of considerations you referenced in your letter. we have some issues that should be addressed. we will be working with both of you on that as we proceed. i want toration, relate the commander of wright- patterson air force base related her concern that so many times and our discussion of the affect of sequestration, we missed the personal effect this is having on the work force, both men and

women in uniform and the civilian workforce. 13,000 people are facing furloughs, those are the people who get up every day to protect our national security. please pass on that members of congress are concerned about the personal effects of people with kids in college, vacations that will be postponed and real-life hardships this is going to result in. question for secretary hegel and general dempsey. my first is about our ability to maintain, responding to to conflicts and my question to general m. sue will be about missile defense and look shoot look as we talk about iran. -- question to general dempsey. as he is about to leave to the munich conference he made the statement -- we will make sure

we can confront and the aggression from any adversary at any time and the place. it's essential we are able to deal of more than one adversary at a time and i believe we have shaped a force that would give us the capability. we have coming up in nato, a joint training exercise currently scheduled in poland. that's important to members of congress because we know how sensitive our relationship is with poland as the administration has walked away from commitments to missile defense. really sure this has the full support of the department of defense. ability as weour look at sequestration and defense cuts to give our allies the assurance we can do to conflicts with a tilt to the pacific. nato is obviously nervous and i would like your comments on that. there is apsey, concern to do look-shoot-look -- we are behind the ball with

north korea and the missile defense program we should have there as we look to the rise of iran. this committee placed language for an east coast site that would augment our missiles in alaska add to give us that shoot-look-shoot. i would like your thoughts of that -- he said an east coast site would give us that increased battle space -- your thoughts on the shoot-look- shoot dr. opportunity? >> thank you. ,n nato, and those exercises and are complete and full support of our continued alliance and relationships. absolutely. and will stayed committed to those exercises and our allies, to the entire framework, the objective and from work of nato. i don't know if you are aware,

but the last four years i've been chairman of the atlantic council. i have given many speeches on this specific issue all over the country and all over the world. relationship we have with nato, they are certainly not a collective security arrangement. it's bigger than just a security arrangement. it is the one anchor that secures interest based on human rights, based on the same value of each of the 28 members. that is a significant starting point. it can't fix every problem. it should not be expected to. to maintain, build and stress that alliance is absolutely critical. it will certainly be reflected andis reflected in current

former relationships. your comment about walking away from the relationship with poland, the missile defense issue. let me comment on that. polls and ourhe nato allies about the decision we made it based on the ground based initiative and i think you know we continue to stay committed and the president said that. one through three, we're looking at for for a lot of reasons and there is some of phase 4 that we think is too expensive and probably doesn't do the job. the polls are in compliance with us and they agree. we're not taking anything out of there. we're continuing to fulfil the commitments and poland as well as to nato. i just want to give you my take

on it. furtheru have anything on that? havet me -- since you taken out phase 4, which was the only portion that would protect -- >> the gentleman's time has expired. >> thank you, mr. chairman. first off, i want to thank the secretary and the department for putting in the budget the hangar and the pization to replace 3's. as we are looking at the budget near term and long term, something that tends to be a feast or famine proposition is the investment we make in electronic warfare. guide, we area headed into famine on electronic

warfare. i hope we can break that cycle. a few questions here -- the secretary has made clear securing and removing of hon. fissile material is a top priority. -- fissile material. an agreement agreed to transfer dollars to support nuclear- weapons programs. these funds are not available to support non-proliferation programs and securing and removing of hon. fissile materials. why is that the case? -- of the hon. fissile material. >> as i address part of that our specific

responsibility with nuclear- weapons is deterrence. the non-proliferation peace is -- has always resided in other agencies, specifically state. we are part of that and cooperate with that. start treaty issues and so on. weparticipate in that, but don't have responsibility for that. as we're looking at these relationships and the agency relationship you're talking about, it is not in the budget because our budget line of responsibility -- >> i would just note -- we're looking at non proliferations and not refer to stove piping when it comes to non proliferation writ large, which

includes a nuclear-weapons program but also includes investment in specific non- puller of ration programs. proliferation programs. >> the comptroller wanted to add something. programis a national and we don't have funding responsibility. we do provide some funding which would be about $500 million. some of that goes to nuclear non-proliferation and support of other agencies' efforts. >> the second question -- last year, we had your predecessor for the first time here to testify on the part of the fed's and dmv cooperation. are you going to continue the efforts mr. panetta put forward to cooperate with the va? especially when it comes to electronic healthcare and the

tracking of these records from the time they enter service and will be on? >> yes. we are committed to continue to work with the va. i just spoke with secretary shinseki yesterday. we have had a number of meetings and that we have a responsibility. we produce the veterans. shouldnot near where we be, but yes, absolutely, we will stay committed and work as a partner and do everything we seamlesslfill a network. >> i think the department needs to be sure that the folks working underneath you are stepping up to that commitment as well. >> one of the first things i did when i got over there was to get into this. 1981 andinistrator in

did -- and 1982. i had a little something to do with getting their system on track. >> on going to lunch one more question at you. are you in favor of closing guantanamo and do you have any authority to transfer any detainees for any reason, whether judicial, medical or military? >> i support the president's position. have ality is we responsibility for get mode now. there are 166 prisoners there. -- responsible for guantanamo now. that's where we are. as secretary of defense, i have to assure the facility of that -- the security of that facility at all the responsibilities that go with the detention facility, including the people we have down there. that's my responsibility.

>> for the record, if we could get an answer to the second question -- to transfer anyone for any reason, at -- thank you, mr. chairman. from mr.l hear now klein and at the end of your questioning, we will take a five-minute recess. >> thank you, mr. chairman. thank you, a gentleman for being here. i have a question that's a little bit off the budget and i don't want to be guilty of ambition you with this. but i want to talk for a minute and ask a question about the medical evaluation board backlog. i don't know if this is something you are on top of, so i'm happy to take the answer for the record. problem outwful there affecting our soldiers. the minnesota national guard now has 100th 68 of these medical evaluation board cases pending

-- has 168 of these medical evaluation boards spending. cases and5269 open the average education time for minnesota cases is currently four and half years. from the date of injury. that's about the national average. that the awful situation and for the reserve component, for the guard, these soldiers have to travel to a base where there is an active duty surgeon dr. that can make the determination. it'sa blow to morale, incredible we have allowed this system to deteriorate in this way. my question is, what are you doing about it and what can we do to help? i would be happy to take it for the record, but i don't want to let it slip by. it's something we have to address and it -- i'm astonished it could have gone to this point

where you have soldiers almost literally being jerked around as they have to travel halfway across the country to go and be evaluated, to come back and it takes years to get the question answered. this affects their ability to be retained and it's an important part of the process. on another subject, because we are in an awful budget package which we have talked about. we have seen the president's or the i wonder if you joint chiefs -- either one of you -- have taken a serious look at the possibility of consolidating any part or all of 16 at the farm and defense agencies or looked at combining the mantid commands -- combining combatant commands? at that timericom

with a lot of money and recruits, without even having headquarters in africa, and these headquarters take not only for start generals, but the appropriate number of a lesser generals and staff. then everyone has to have their own intelligence center. it seems now was the time to look at that. i would be interested in any thoughts you have about that possibility. >> on your first question, that is unacceptable. i was not affair of the specifics that you mentioned. i will be become aware of them, we will get back to you. we will give you a complete answer on what we're doing about it. >> thank you. >> on the second question, i'm not aware of any serious consideration of consolidation of commands or any of those structures. i'm going to ask general dempsey

to respond. i would say as we get deeper into this strategic priorities and management review, i don't know whether your specific questions would be addressed exactly you added them merging some of the commands that we have now. certainly, pieces of those will be reviewed in this review. so let me now use any more of your time with me on this because the chairman will have a better answer. >> we're looking at the fourth estate, which is the defense support agency wearns looking at the commands and not only them but the component commands are reside under them. we're looking at it in its entirety. >> thank you. i appreciate you sharing on the commands and you going forward. i appreciate the answer from

both of you and i yield back, mr. chairman. >> mr. secretary, when you respond to the gentleman can you give that to the committee i think all of us are having the same problem in all our districts. >> i will. >> the committee will stand in recess and we'll reconvene at 12:15. >> the meeting will come to order.

>> thank you very much, mr. secretary. i would like to welcome ecretary hagel, germ defercy and under secretary hale. the 11 years i've been in wanted qualm better known and i did not think it would be under these circumstances. i want to thank you for your leadership in the current north korean threats and your willingness to reposition a missile position on guam. that is assuring news. i appreciate the department's continued commitment for the marines.nt funding for i think the f.y. 2014 builds off

this progredge. mr. secretary, i read in your atement that the f.y. 2014 budget protects or increases key investments in missile defense at a cost of $9.2 billion. one aspect of this defense is to threats.gainst now the e.i.s. for the guam re-alignment called for a personal negligent missile defense system on guan. given the unpredictability of the varies you actors in our region, can we expect the reconveniently deployed remain on guam permanently, which is consist went the e.i.s.? >> congresswoman thank you. i appreciate your comments. i'm going to make a brief comment in response then ask

general dempsey to be more specific. you ended your statement with the observation, which is correct of the uncertainty and the unpredict ability in our part of the world right now. that's what we have to factor in all of our decisions as we prioritize where are the threats, where are they coming from and where will they may continue coming from. our decisions on all our platforms are always evaluated on that basis. it is specifically addresses your area in guam. with that, let me ask general dempsey to be more specific to answer your question. >> when we deployed it we did so with the fact that we would

review the decision in 90 days. we have another one in training and another one that will come on after that. it would be prudent to wait to decide whether to leave it there permanent until we see how the rest of the world evolves in terms of missile threats. right now guam is protected by the sea. e're not going to leave guam unprotected. is may or may not stay there permanently. >> general and secretary, i would respectfully request that we have something there permanently. my second question is as the ranking member of the sub committee, reductions made to military forces and those requested to the d.o. document do not draw a parallel to the current threats facing our dation. would like you to -- nation i

would like to describe how you will meet five years. how will you know that the farce is not ready? what are the triggers or the metricings that make such a situation evident? >> thank you. first, as you know so well, readiness is our first priority. i will begin with some of the conversation we've had this morning on the whole point behind the strategic choices and management review that i directed about a month and half ago, which deputy secretary carter and general dempsey are leading. it focuses on the key question, readiness, when and how, when will we know. that's why we're doing this.

that's why we're looking at everything. we're factoring in every budget reality, ma what may happen, what may not happen. at is the essence of what we do and our main responsibility. having the capability to be ready to respond, take issues, agile, flexible, capable with the fore structure and everything has to support that. >> can i ask one further small question? >> no. the time has expired. mr. rogers. >> thank you mr. chairman and hank you for your service. represent alabama and several warriors sacrifice their lives. the department sent furlough

notices across the civilian work force. my question is when it comes to the depo and several maintenance facilities like it that are funded through the defense working capital fund, which is fully funded ands has carried over into next year, why are they be issued furlough notices? >> i don't believe we've sent any furlough notices out? >> you've notified the congress about the possibility of furloughs but we have not sonet sent ividual notices -- out individual notes. >> would that may have to conclude insulations funded bies the defense capital fund that is fully funded for this fiscal year? >> we're going to have to exempt some civilians for safety,

security, the areas that are the highest priority. as to your specific question -- >> yes, it could. we have not made a final decision. you say fully funded but we're having terrible cash problems in the depot because of the reduction in the work load given what has happened to the budgets that have paid for them. we have not made a final decision but it could include. >> under what basis, the money is there. they have carry on work well into next year that is funded. >> it has to break even by a cash basis by law and we have a cash crisis because the work load is being drawn down in many of them. we have not made a final decision either way but i can't sit here and tell you no chance there would be any furloughs of

depo workers. >> if, in fact, it happens i would like to have a more detailed conversation with you about how that could arise but thank you. >> excuse me, congressman, if i may get to your point -- your request. yes, we will. we obviously, if we have to do that and make any of these tough choices on furloughs, which as you know we've been talking about, hopefully we don't have to or at least minimize it as we move from 21 to 14. we would let the congress know of our actions. >> thank you. >> mr. secretary, your predecessor, secretary panetta stated that he believed the treaty route with confirmation by the senate was the only appropriate way to compromise with nuclear sises in another

state. do you concur with that assessment? >> generally, that is the route russia, sovieten union. treaties are important, i've always supported -- >> there was something under the bush administration it was criticized for trying to get around the senate and it would not be verifiable. i hope you still feel that will you did when you were a senator that the senate would have to ratify any nuclear arms agreements. >> i think all of those treaties are important, that route, that process for no other reason for what you just noted. it brings the american people into it and it brings the congress who represent the american people into that process. now, there may well be as we get

into complicated pieces down the road some variables can we do something better this way than a treaty. i don't know. but you look at all the options, you look at all the ways to accomplish the purpose and the end mean. verall i have not changed my opponent as i sit here. >> thank you. general dempsey do you believe such an agreement would be verifiable? >> that is a policy decision. what i've said that the military advisors that any further reduction should be part as a negotiation and not unilateral. >> thank you both and for your service again. i yield back. >> thank you. > thank you to the witnesses for your endurs this morning. stance. -- endure

-- have been pushing for this committee and i hope you will continue that effort as we're dealing with budget issues we have to see what we're doing in waste and doneably case. it is there, we know it. i did get your letter and i want to thank you that expressed your commitment to that. secondly, on expert controls, the department moved forward to simplify lie the defense controls for manufacturing and things like valves and helicopter parts and engine parts that are restricted because of outdated regulations. again, good progress recently and i hope under your leadership that will continue. the budget document tries to frame back in the context of the budget control act.

2021 is the time frame of the budget control act. someone who has spent seven years on the sub committee no prior back is able to do that in less than six years. that is just a case that doesn't work. there might be other reasons that people want it but doing it in the context of the budget control act, frankly, who have spent a lot of time on it doesn't work. you made your vifert to afghanistan and i compliment you on the elegant response when you were asked about the situation there and described it as complicated. would just say as someone who 's a district we lost a marine a fewn, their funeral was weeks ago.

are you going to come to us with your own thoughts now that you've had some opportunity to digest the situation over there about -- between now and then, what is the pace? is there, again, more feedback to us in terms of what your thoughts are on this conflict, cho should be our number one priority in this committee with 66,000 troops in harm's way. >> thank you. thank you for your first two comments and we'll continue to work together on those. on your question regarding afghanistan. first, you're exactly right. it is our first priority. we're at war, we have 66,000 americans there. we've been there 12 years and there's no higher priority. we'll continue to do everything to support that mission and make that the highest priority. universe of rger

thoughts on -- my thoughts regarding drawn down times and so on. when i was in the senate i went to afghanistan many times. in matter of fact, i was the first delegation that landed here and i landed in 1:00 in the morning an january of 2002. that does not mean i'm an expert on it. be i've been back many times since. i support the current process draw down time. ow we're doing it responsibly, i think it is critically that we do it responsible. i think the first question i had that this morning