welcome to "this week in defense news," i'm vago muradian. the united states coast guard is america's multi-function maritime security force charged with protecting the world's largest exclusive economic zone. from inland waterways at home to the far reaches of the pacific and the world's frigid poles, the coast guard and its 42,000 active and 8000 reserve coast guardsmen execute 11 statutory missions, including maritime law enforcement, environmental and fisheries protection, marine safety, drug and migrant interdiction and search and rescue. despite universal admiles an hour etion for its capabilities and can-do spirit, it's a force that's been underbudgeted at the best of times, much less when all government spending faces cuts.

ron oroark every the congressional resource service, one of america's top naval analysts in a recent report warns that even with 244 cutters, 800 boats and 200 aircraft, the air force has only 60% of the equipment it needs to do its legally- mandated missions. america's oldest continuously sea going force has been working to modernize its fleet of 90 large, medium and small cutters with new ships, but replacements have been more costly than expected and are being fielded more slowly on a fixed budget. here to talk about the future of his 221-year-old force is the 24th comdapt of the united states coast guard, admirable robert pat. welcome to the show. >> vago, great to be back. >> congratulations for coast guard alaska. that's really a great program and lets people know what you guys are doing in the reaches of america. >> stay tuned, coast guard florida is coming next. >> outstanding. that'll be obviously less search and rescue and a little

bit more interdiction. to that end, sir, the coast guard, you know, talking a little bit about ron's report which was really eye opening, you've always said past comdants have put a level of coast guard investment that's going to be needed in order to modernize the force. this year you're going to be about $800 million, you know, $2 billion is the number you've set, it's $1.2 billion in acquisition funding this year. in the best case you get up to $1.7 billion over time. and the question then becomes, you know, since you're always going to be below this number, at what point do you cease to be a viable force or really have to shed mission? >> i'm not sure exactly when. i know we're not there yet. but what i've told everybody in all of my congressional testimony, i've said for years before i became comdant and i say now is the coast guard has never, never in our history been resourced to do 100% of the jobs that are given to us. so what we do is we train leaders who make decisions on what the highest priorities are on a day-to-day basis and they

attack those missions first. we use whatever we have left over to get to the lower priority missions and then when disaster strikes, everything falls aside and we respond to that. >> every military service has historically been vague about the puts and takes when budget cuts really get tough. what is it going to be able to do and what is it not going to be able to do, but at the naifily league show earlier this year, at the conference part of the show, you really went beyond what most folks said which is to describe the kinds of tradeoffsoffs you'll have to makement one of those is when the drilling begins on the north slope, you'll do less on the pacific coast in order to transfer assets up there. how far away are you from being able to fully perform all of those 11 statutory missions that you have? >> we're not able to perform 100% on all those 11 statutory missions. but, you know, people have a hard time wrapping their hands around 11 statutory missions, even when we say multi mission, people don't understand that. so what i've come to do is when

i'm speaking to laymen, even when i'm speaking to people in government, i say what we do in the coast guard, we protect the nation from threats in the sea, we protect the sea itself. we are responsible for the safety, security and stewardship of america's waters. america's waters are vast, 3.3 million square miles in our exclusive economic zone which may grow if we acede to the law of sea treaty because it will extend the outer continental shelf. right at the 14 it charges u.s. coast guard of enforcing laws on our u.s. waters for foreign vessels and u.s. vessels. so that's a pretty broad job and what we do is we tykify night resources and apply them to the priority of resources everyday. >> given where the spending patterns are going and given where the size of the force has been going, obviously you can live with a smaller force as you get better command and control, you're aiming your resources better in order to do that, some of the assets themselves are actually better and superior assets, but at the

end of the day, it is a numbers game given the amount of real estate you guys have to cover. if you don't have the capacity to perform all of these missions, at what point do we need to start transferring missions to other government agencies or just dropping them entirely? >> i think that's a specis argument. we've looked at that ourselves. for instance, the u.s. lighthouse service came into the coast guard in 1939, aids to navigation for our country. people always suggest, well, you can either privatize that or transfer it to somebody else. it's still going to cost the government money. if you transfer that to another agency in the government, that budget authority will go with it. a similar situation happened with our ice breakers about six years ago. we decided okay, the national science foundation is the customer for these, the money for operating them was transferred to the national science foundation. they started leasing foreign ice breakers, we lost the money to support the ice breakers that we have and they started deteriorating and now we find oufers ourselves in a woaful

condition for polar ice breaking. i think what would have to happen is the government says we're not going to do something anymore because if the government continues to do it, some budget authority is going to go to somebody and i would make the case if it's going to come to somebody, the coast guard will get the best job done for every dollar that it's given. >> the whole town is buzzing with an array of ideas of how to be able to do more with not more, as some would say, or to to be able to do as much as you with can -- you can with less. what are some ideas to get the most out of the budget? >> right now we're at a tipping point. it's going to be interesting over the next couple of years, because i would contend right now we are at the mere basics of trying to balance between frontline expectations, what the american people expect of us operationally and recapitalizing. on the recapitalizing side, we're at the bare minimum, the minimum order quantities in almost every project that we are doing to keep them alive. what that does is it expands

the time period which you replace everything and ultimately costs you more because you're doing it over a longer time period >> and you're keeping older assets which are costly. >> which are more costly and comes out of your operating funds as well. we're really at that tipping point right now. i don't know when that time will occur, but at least for right now i think we're keeping the proper balance. >> let me take you to the top question which everybody is asking in washington which is sequestration. obviously there -- obviously there's a danger of that happening. there are folks meeting with ideas on the table of how to potentially avoid it. the administration has said it might be able to shelter military personnel accounts if that happens. it's a multipart question for you, first, if it happens, what's the sequestration impact on the coast guard? we tend to think of what happens at the pentagon and you're at the department of homeland security. what are you preparing to do for it and can your personnel accounts be sheltered? >> we're hopeful that the personnel accounts can be sheltered because we fall under the defense authorization act in terms of military pay and

benefits. but many of our missions, as you know, unless they are defense related are performed on the domestic side of the government's budget. so we're running through various scenarios. it's really premature for me at this point to start saying what i would do because we're looking at a lot of different options. i certainly have some things in mind, but all my senior leadership is engaged right now coming up with the various options and presenting them to me in that eventuality. >> how devastating an impact is it going to be on you guys if you get nail snd >> it's going to be very, very significant. you either have to eat into your operations that you're performing or your long-term plans for recapitalization or what i don't want to do is what i really reluctant to do is what we did in the late '90s when the coast guard was being reduced because we cut away our support structure. we let go engineers, comptrollers and acquisition experts, acquisition being very important because when the money starts flowing after 2001

to rebuild the coast guard, rebuild more ships, we didn't have the acquisition or the work force to do it and the project, quite frankly, we stubbed our toe in the beginning and had some major screwups. we have corrected that. we've got a great acquisition force now, but i want to keep that acquisition force and our engineers and our comptrollers. >> we'll be back with more with admirable robert pat, the comdant of the united states

we are back with the coast

guard commandant robert papp. sir, the coast guard had planned to replace 12 of its large hamilton class cutters with four national security cutters. some look like they're in pretty good shape, under contract or soon to be, but all funding for numbers seven and eight which are critical to your plan were dropped from the 2013 five-year capitalization plan, capital investment plan. can you make do with six cutters and what's going on in order to be able to get those ships back in your budget. >> i don't think we'll have to make do with six. there are a couple of options ki deal with there. the first thing which i prefer to look at from an optimistic standpoint is they weren't dropped. they are still the program of record. secretary napolitano has testified to that in front of the house and senate. yes, in the five-year capital investment plan they were zeroed out in terms of funding. there's also a caveat on there that the department of homeland security will work with the department of drves to make sure we -- department of of defense to make sure we are not building redundant fleets and the navy needs what it's

building and the coast guard needs what it is building as well. so i think that is an unresolved question at this point. clearly we're talking with the navy and admirable greenan and i meet frequently and speak often and we're going to continue to work through that. i'm focused right now in try to go get the full funding for number six in the fy '13 budget and we'll start tackle fy '14 budget after that. >> what are the consequences of interrupting the production list? >> rough estimate as you push these ships out a year it's roughly about $50 million. the contractor, the ship builder has to take into consideration the fact that how long am i going to have to keep this work force, how much are the parts going to cost if i have to buy them a year later, and so we've used the figure of about $50 million. >> is it possible to do an end sea light as some suggested to strip of its combat system and strip it of its sensors and build them back later? >> we're looking at that.

we're taking a lesson going back to before world war ii, coming out of the great depression, the administration and the congress decided to build a new class of cutters for the coast guard, the 327- foot secretary class cutters. >> the legendary class. >> and they lasted us -- the last one was decommissioned over 50 years of age, the gingham which is in key west right now. but they've left space weight reservation so that they could adapt to missions and things as they went along and they went through world war ii, korea and vietnam. so i would envision something like that for the national security cutter if we were to build one light. and folks can go up to baltimore and see the tawny as well which is a little bit more local. looking at the budget, there are those who get the sense that the two cutters were dropped in favor of the new heavy ice breaker that was funded. were the cutters sacrificed for the ice breakers? >> not to my knowledge. clearly you could probably deduce that or think that because we did have the money for the ice breaker in there, but i've been asking for an ice breaker as long as i've been

commandant. my immediate two predecessors have asked for an ice breaker. so the good news is money has been put in the plan to build a new ice breaker which this country desperately needs. but i go back to saying that the secretary has testified eight national security cutters is the program of record. she's stated that and she has been working to help us out. and what we need to do is continue our negotiations with the navy to come up with a study that demonstrates that both fleets are needed. >> let's look at the ice breaker since you mentioned that. obviously you guys have been studying this for very many years. what are the requirements for this new ship and what are the kind of national security capabilities do you want it to have? >> well, we've been identifying the need for an ice breaker for many years. polar sea and polar star are both over 30 years old and because of the budget situation over the last decade, one was laid up for a significant amount of time and we're restoring polar star right now and we'll be decommissioning polar sea by the end of this

year. the whole form, the -- hull form, the propulsion, things like that are pretty easy to come up with requirements for, but we also have to look at the department of defense, department of interior, the national science foundation and come up with their requirements and incorporate that. so in the budget that's up on the hill right now, we got $8 million to start detailed requirements and design and i suspect it'll look something very much like the polar class that we have now, but probably different accommodations, updated equipment that doesn't require such a large crew and accommodations for scientists. >> six-foot continuous ice- breaking capabilities. >> we need to have the ice breaker, yes. >> and how many do you need? >> well, you know, it depends. in unconstrained studies people say we need six heavy breakers and three medium -- or six heavy and six medium. right now all i've got is one ice breaker.

so i'll be heam to get that additional -- happy to get that additional one. >> let me put two questions in the next minute we got in this seg: you guys put the rfp out for the new offshore patrol cutter. what are the attributes and capabilities you want in that ship and what are the lessons you learned from the fast response cutter that are going to be shaping that program? >> the lessons we learned from the fast response cutter are that we need to go with a parent craft design. there are plenty of good designs out there i think companies in the u.s. can buy the rights for and adapt to what we're looking for. and we've set some goals in terms of the requirements, speed, sea keeping, sea keeping is very important for us because with fewer national security cutters, we are going to need ships that are able to operate in the bearing sea in the western pacific. so long legs, good fuel economy and ability to operate in weather. and probably the most important thing is affordability, within the draft request we've put in

affordability figure of about $276 million per ship. that's what we're shooting for right now. >> and very quickly air force wants to get rid of the c-27js. are they going to find a home in the united states coast guard? >> if they want to give them away, i'll be happy to take them because it will help with up front costs and make room in the acquisition budget. >> but if you have to pay for them, it'll be tough. >> there's no formal offer at this point. if the air force does give them up, i figure it will be a transfer at no cost. we'll have to put in some unique sensors and things. it will be a good deal for the coast guard. k, and i was trapped.

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we are he back with admirable robert papp, the 24th commandant of the united states coast guard. sir, the coast guard is universeally loved, admired for its people and its capabilities, combatant commanders have told me how important it is having a coast

guardsman on their staff is, especially with the relationship with china because you guys have a much closer relationship that exists on the mill mill side to be able to open doors, avoid crisis, open dialogue as the case is. at a time is when natural resources in the sea, whether it's fisheries or oil is so important, why is it so hard to make the national security case or the national case for the coast guard and resourcing it adequately? is it a message problem, it a -- is it a mess ger problem? is it the can-do spirit of the service? >> that's a much larger issue. in this country, many times it's hard to convince people we are a maritime nation. we bring in 95% of our foreign trade comes in ships. that is $700 billion in gross domestic product and $51 jobs. and i've always contended that a measure of a great nation is reflected in the resources that it provides for the safe and

secure approaches to its shore. our country's prosperity depends upon maritime trade. the coast guard facilitates that by providing safety, security and stewardship for our waters. we set age navigation to get ships here safely. we protect, we respond to marine disasters and we provide security for our nation. so it's trying to get people to understand that concept that going back to the earliest days of our country, 236 years ago, it depended upon maritime trade and we help. >> when we started the interview, one of things you said is it's been a historic problem of underresourcing. is the can-do spirit of the service where you don't get more but manage to do a lot actually work in your disadvantage in order to make the resource argument sometimes? >> as i've said many times, it's our greatest strength and our greatest weakness. on the other hand, i would never tell my people that we should stop performing at the levels that the country has been accustomed too because we do, we bring smiles to people's

faces. when i walk up and talk to appropriators on the hill, they say that we know when we give you dollars they're going to be well spent. the challenges i think across the government, though, there's no one getting all they need to do all the jobs they're tasked with. so we just have to continue doing the best we can. and what i'm trying to do is indemnify my leaders by saying, okay, we're going to set priorities. there are some things we're not going to be able to get done and i will articulate those things to the administration, to the congress, to the people of the nation. >> the navy is in the process of rewriting its portion of the maritime strategy. you guys were involved in it, you were involved last time. this time there's an indication that the navy wants to focus on high-end warfare and a little less on the low end. what does that mean for the coast guard and does that mean you'll be assuming more of the lower end mission? >> it'll be difficult for us to assume more missions that perhaps the navy is sacrificing. what i can do is, for instance, with the swing to the pacific and the national defense strategy, clearly the chief of

naval operations is going to have to devote a lot of his resources in that direction and towards central command. the combatant commander for southern command, however, is probably going to get fewer resources, the friggets that are sent down there to help with drug interdiction are going away by fy '18. to is becomes the defacto fleet for south com migrant missions. >> law of the sea treaty, why is it important? >> it's important because me than any other service chief deal with a full range of maritime issues. every time we either negotiate a bilateral agreement for drug interdiction or when i go to the national maritime organization in london, i get lectured constantly of why hasn't the united states who espouses belief in the rule of law and working peacefully with other countries, why haven't you signed on, and it delays

and protracts our negotiations because we're not operating from a common framework. >> sir, thanks so much [ male announcer ] olympic tennis players bob and mike bryan

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no way. yes way. well let me chip in. [ male announcer ] send money from one bank account to another, with citibank popmoney. easier banking. every step of the way. if elected, republican presidential hopeful mitt romney promises to reverse last year's defense spending cuts and actually increase military spending by pegging his pentagon's budget to 4% of gross domestic product. if the economy grows as robustly as romney claims it will under his watch, that could take defense spending to as much as $900 billion by 2021, nearly $300 billion more than current levels. that may sound sweet to pentagon officials and contractors, but it's highly unlikely to happen no matter who wins the election in november. this is a math problem even with economic growth. the nation has more than $15 trillion in federal debt that has to be reduced. meanwhile, romney wants to cut taxes, raise defense spending

and tackle the debt which experts say is impossible unless he also makes deep cuts to medicare, medicaid and virtually all other discretionary spending. even romney insiders admit today's budget realities could prohibit a big boost in defense spending, saying increases would have to be gradually if they can be achieved at all. complicating notions of paying for defense by cutting entitlements or polls that americans prefer deeper defense spending cuts to military spending increases. history is our best guide here. in constant dollar terms over the past four boom-and-bust cycles, defense spending has peaked at just over $500 billion and bottomed out at about $360 billion. with the obama administration seeking $525 billion in 2013, it's wiser to assume and start planning for a leaner future than hoping for a fatter one. thanks for joining us for "this week in defense news." i'm vago muradian. aisle he be back next week at the same time. until then, have a